/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/091009.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, October 9, 2009, Vol. 13, No. 279 Headlines 1031 TAX: Settlements-Based Ch. 11 Plan Gets Approval 945 DEVELOPMENT GROUP: Voluntary Chapter 11 Case Summary ABITIBIBOWATER INC: Mill Production Cuts to Affect 1,500 Jobs ABITIBIBOWATER INC: Paul Weiss Charges $3.3MM for 3.5 Months' Work ABITIBIBOWATER INC: Sierra Liquidity Buys $21,000 Claims ACCURIDE CORP: Files Chapter 11 with Restructuring Plan AEP INDUSTRIES: Moody's Upgrades Corporate Family Rating to 'B1' AIRTRAN HOLDINGS: S&P Assigns 'CCC-' Rating on $75 Mil. Notes ALASKA LODGES: Fishing Lodge to Be Sold to Pay KeyBank AMAPOLA ORANGE: Voluntary Chapter 11 Case Summary AMERICAN COMMUNITY: Chapter 11 Case Dismissed by Judge AMERICAN REPROGRAPHICS: S&P Affirms 'BB-' Corporate Credit Rating AMERICAN TREE CO: Voluntary Chapter 11 Case Summary AMERITYRE CORP: Auditors Express Going Concern Opinion ANGIOTECH PHARMACEUTICALS: S&P Raises Corp. Credit Rating to 'CCC' ASARCO LLC: Parent Renews Request for Stay of SCC Reimbursement ASARCO LLC: Plan Solicitation Deadline Moved to Dec. 31 ASARCO LLC: Sterlite, Union Oppose Recommendation on Grupo Plan AURA SYSTEMS INC: Case Summary & 20 Largest Unsecured Creditors AVIS BUDGET: Offers $300MM of 3.50% Convertible Senior Notes BABUSKI LLC: Trustee May be Appointed to Liquidate Assets BARZEL INDUSTRIES: Auction of Assets to Proceed October 28 BARZEL INDUSTRIES: Wins Final Approval of $30MM DIP Financing BARZEL INDUSTRIES: U.S. Trustee Forms Three-Member Committee BASSADOUR BUTLER: Files for Chapter 7 Bankruptcy Protection BATTLE CREEK MUTUAL: A.M. Best Affirmed FSR of 'C++' BEACH PHAM LLC: Chapter 11 Case Summary & Unsecured Creditor BENJAMIN BRASHEN: Case Summary & 7 Largest Unsecured Creditors BERNARD MADOFF: Sterling Didn't Lose Money, May be Clawback Target BLOCKBUSTER INC: Lonestar Partners Discloses 6.0% Equity Stake BOSQUE POWER: Moody's Downgrades Rating to 'B3' From 'B2' BOWMAN INC: Case Summary & 20 Largest Unsecured Creditors BRENT THEODORE BARKER: Case Summary & 10 Largest Unsec. Creditors BRUCE ALLEN: Case Summary & 12 Largest Unsecured Creditors BUILDING MATERIALS: Plan Outline Hearing Moved to Oct. 22 CALIFORNIA COASTAL: KeyBank Agrees to Forbear Until Nov. 1 CALYPTE BIOMEDICAL: Posts $829,000 Net Loss in 2009 Second Quarter CANWEST GLOBAL: Releases Financial Projections CANWEST GLOBAL: Says It Won't Liquidate Assets CANWEST GLOBAL: Wants Canada as Site of Main Bankr. Proceedings CANYON RIVER CENTER: Case Summary & 2 Largest Unsec. Creditors CAPMARK FINANCIAL: Contributes $600MM of Capital to Bank Unit CARIBE MEDIA: S&P Junks Corporate Credit Rating From 'B' CASCADE GRAIN: Ethanol Plant Will be Sold Off to Pay for Debts CHEROKEES OF ALABAMA: Chief Denies Bankruptcy Rumors CHIPOLA RIVER LLC: Case Summary & 8 Largest Unsecured Creditors CHRYSLER LLC: Amends Complaint against Daimler AG CHRYSLER LLC: Anchor Group Drops Claims vs. New Chrysler CHRYSLER LLC: U.S. DOL OKs Transfer of Note Stock to VEBA CHRYSLER LLC: Won't Oppose Dealer Direct Appeals Certification CIENA CORP: S&P Puts 'B+' Corp. Rating on CreditWatch Negative CIRCUIT CITY: To Present Liquidating Plan for Confirmation Nov. 23 CIRCUIT CITY: Douglas County Objects to Confirmation of Plan CIRCUIT CITY: Proposes Settlement Agreement With PBGC CIRCUIT CITY: Proposes to Reject Safeco Surety Bonds CIRCUIT CITY: Objection to Employees' Time Off Claims Overruled CITIGROUP INC: Execs Reshuffling May Be Needed, Says Egon Zehnder CLARIENT INC: Deloitte Replaces KPMG as Outside Auditors CLEAR CHANNEL: Denies Loan Restructuring Talks with Banks CLEARPOINT BUSINESS: ComVest Appointees to Serve Until Dec. 27 COLLINS & AIKMAN: Visteon Reliance on Lawyer Not Excusable Neglect COMSTOCK RESOURCES: Moody's Assigns 'B2' Rating on $200 Mil. Notes COMSTOCK RESOURCES: S&P Assigns 'B' Rating on $200 Mil. Notes CONVERGYS CORPORATION: Fitch Assigns ' BB+' Rating on Junior Bonds CONVERGYS CORP: S&P Assigns 'BB-' Rating on $125 Mil. Junior Notes COOPER-STANDARD: Cooper Tire Allowed to Sue Applicant in U.S. COOPER-STANDARD: Cooper Tire Amends Suit to Include Canadian Unit COOPER-STANDARD: CS Automotive's Schedules of Assets & Debts COOPER-STANDARD: CS Automotive's Statement of Fin'l Affairs CORUS BANKSHARES: Starwood/TPG's $2.77-Bid Wins Assets Auction CR NEVADA ASSOCIATES-AVE: Voluntary Chapter 11 Case Summary CRYOPORT INC: Expects to Raise $8.8MM by Issuing Common Shares CRYOPORT INC: Restructures Obligations to Debenture Holders CYNERGY DATA: Lenders Balk At $21M Transfer to Harris DAN KOOSH: Case Summary & 10 Largest Unsecured Creditors DANA HOLDING: Achieves Full Compliance with NYSE Listing Standards DANA HOLDING: Goldman Sachs Picks Option to Purchase Shares DANIEL FLORES: Voluntary Chapter 11 Case Summary DEL FRISCO: S&P Changes Outlook to Stable, Affirms 'B-' Rating DELAMORE ELIZABETH: Files Chapter 11 in Dayton, Ohio DELPHI CORP: Businesses Split Into 3 After Emergence DELPHI CORP: Ace American Sues for Scope of Coverage for Claims DELPHI CORP: Renames Steering Biz as Nexteer Automotive DELPHI CORP: 2nd Amendment to ERISA Settlement Has Interim Nod DENNIS WILLIAMS: Case Summary & 4 Largest Unsecured Creditors DEVELOPERS DIVERSIFIED: Fitch Affirms 'BB' Issuer Default Rating EDGE PETROLEUM: Disclosure Statement Hearing on Nov. 10 EDGE PETROLEUM: Gets Approval on All "First-Day Motions" EDGE PETROLEUM: Case Summary & 30 Largest Unsecured Creditors EMPIRE RESORTS: Special Stockholders' Meeting on November 10 ENERGY FUTURE: Has $4-Bil. 'Distressed Exchange' Offer ENRON CORP: Two Ex-Merrill Execs Set for Retrial in February ERIK BRIONES: Case Summary & 20 Largest Unsecured Creditors EXCO RESOURCES: S&P Raises Corporate Credit Rating to 'BB-' EXTENDED STAY: Opposes $1.03 Mil. Fees of McKenna Long EZ LUBE: Creditors Want to Probe Bruckmann for LBO Role FANNIE MAE: Preparing Program to Aid Mortgage Banks FIRST BANCORP: Fitch Downgrades Issuer Default Rating to 'B-' FLORIDA PLANT: Case Summary & 20 Largest Unsecured Creditors FLYING J: Denies Rumors on Truck Stop Sale, Restaurant Closing FONAR CORPORATION: Marcum LLP Raises Going Concern Doubt FREDDIE TARVER: Case Summary & 5 Largest Unsec. Creditors FREEDOM COMMUNICATIONS: Committee Balks Bid to Use Cash Collateral FREEDOM COMMUNICATIONS: Has Until November 16 to Files Schedules FREEDOM COMMUNICATIONS: U.S. Trustee Forms Five-Member Committee FREEDOM COMMUNICATIONS: Creditors Blast Houlihan Lokey Involvement GARY MCDOUGAL: Voluntary Chapter 11 Case Summary GENTA INC: Amends Lease Agreement with Connell Company GENERAL MOTORS: Penske Ends Talks to Buy Saturn Brand GREEN WAY DEVELOPERS: Case Summary & 4 Largest Unsecured Creditors GREENWOOD ENTERPRISES: Case Summary & 12 Largest Unsec. Creditors GROUND & POUND LLC: Voluntary Chapter 11 Case Summary GTC BIOTHERAPEUTICS: Board Appoints Four New Directors HATTIE CRANE SCHERBACK: Voluntary Chapter 11 Case Summary HAYES LEMMERZ: Creditors Try to Shred Chapter 11 Plan HERTZ CORP: Audit Integrity Wants SEC to Probe Hertz HOVNANIAN ENTERPRISES: Fitch Affirms 'CCC' Issuer Default Rating INNOVATIER INC: Emerges From Chapter 11; Creditor Recovery at 100% INSIGNIA SOLUTIONS: Files DollarDays' Business Presentation INTERDENT SERVICE: Loan Maturity Won't Move Moody's 'Caa2' Rating IRIDIUM COMMUNICATIONS: S&P Assigns 'B' Corporate Credit Rating IRON HORSE GROUP: Voluntary Chapter 11 Case Summary ISOLAGEN INC: Reorganizes as Fibrocell Science J.D II INC: Case Summary & 10 Largest Unsecured Creditors JAMES GLENN HARDY: Voluntary Chapter 11 Case Summary JOSEPH ZAPATA: Case Summary & 20 Largest Unsecured Creditors JUPITER FAMILY: Case Summary & 20 Largest Unsecured Creditors KANSAS CITY SOUTHERN: S&P Gives Stable Outlook, Affirms 'B' Rating KENT ALAN GARDELLA: Case Summary & 20 Largest Unsecured Creditors KOCH GROUP: Owner Fighting Suit, Tries to Take Co. Out of Ch 11 LAURIE SOLLER D.D.S.: Case Summary & 2 Largest Unsecured Creditors LE TAP OF ST. GEORGE: Voluntary Chapter 11 Case Summary LEAR CORP: Judge Opens Door to Patent Suit Against Firm LEWIS EQUIPMENT: Taps Munsch Hardt as General Bankruptcy Counsel LIGHTHOUSE FINANCIAL: Files List of 20 Largest Unsecured Creditors LOCAL INSIGHT: Projected Weak Credit Cues S&P's Junk Ratings LPATH INC: Extends ASONEP(TM) Collaboration with Merck Serono LYONDELL CHEMICAL: Trustee Joins Calls for Chapter 11 Examiner MACLOVIO MARTINEZ: Case Summary & 3 Largest Unsecured Creditors MARGAUX WESTOVER: Case Summary & 17 Largest Unsecured Creditors MERISANT WORLDWIDE: Seeks Approval of Newport Global Agreements MICHAEL WRAY: Files for Chapter 11 Bankruptcy Protection MIDWEST HOTEL: Case Summary & 2 Largest Unsecured Creditors MOSHE SEGEV: Case Summary & 20 Largest Unsecured Creditors NATIONAL DATACOMPUTER: Berens Resigns; Bucacci Assumes CEO Post NATIONAL PROCESSING: S&P Raises Corporate Credit Rating to 'B' NBC ACQUISITION: Moody's Gives Stable Outlook; Affirms 'B1' Rating NEWPAGE CORP: Completes $1.7BB 11.375% Sr. Secured Notes Offering NEXT 1: Posts $985,000 Net Loss in First Quarter Ended May 31 NORTEL NETWORKS: Ciena Signs $521MM Deal to Buy Ethernet Assets NORTEL NETWORKS: Has Interim Resolution With IRS on $3BB Tax Claim NORTHEAST NEUROSURGERY LLC: Voluntary Chapter 11 Case Summary NOVA CHEMICALS: S&P Puts 'B-' Ratings on CreditWatch Positive PARKLANE INC: Voluntary Chapter 11 Case Summary PARMALAT SPA: Bondi to Appeal Dismissal of Suit vs. Grant, Banks PARMALAT SPA: Completes $100 Mil. Settlement With BofA PARMALAT SPA: Irish High Court OKs deal With Eurofood IFSC PARLUX FRAGRANCES: Reports 8% Increase in Q2 Net Sales PARRISH STROUD: Voluntary Chapter 11 Case Summary PEANUT CORP: Ron Simon to File 55 Claims for Compensation PENN TREATY: May Need $1.3 Bil. for Reserves for Claims PENSKE AUTOMOTIVE: S&P Affirms Corporate Credit Rating at 'B+' PETROQUEST ENERGY: Moody's Retains 'B3' Corporate Family Rating PETRORIG: Sells Two Rigs for $950 Mil. to Diamond Offshore PILGRIM'S PRIDE: Argo Partners, et al., Buy $1.59MM in Claims PILGRIM'S PRIDE: To Open 150 New Jobs in Suwannee County PLAINFIELD APARTMENTS: Hearing on PMUA Claim Moved to Oct. 6 PLIANT CORP: Judge Approves Apollo-Backed Chapter 11 Plan PRESSTEK INC: Lender Group Forbears Until November 30 PROMETRIC INC: Moody's Gives Positive Outlook, Affirms 'B2' Rating PTC ALLIANCE: Gets Nod to Use $5-Mil. DIP Loan from Black Diamond PTC ALLIANCE: Wants to Hire Messana Rosner as Del. Special Counsel PTC ALLIANCE: Wins Approval of 'First Day' Motions QUIKSILVER INC: Moody's Downgrades Rating on Senior Note to 'Caa2' RAFAEL ALMONTE RAMIREZ: Case Summary & 20 Largest Unsec. Creditors RANCHO PACIFIC: Case Summary & 20 Largest Unsecured Creditors RAPTOR PHARMACEUTICAL: To Issue Up to $30,000,000 in Securities RAWHIDE OPERATING: Case Summary & 20 Largest Unsecured Creditors RESERVE PRIMARY: WilmerHale Withdraws Representation in SEC Suit ROCKWOOD SPECIALTIES: Fitch Affirms Issuer Default Rating at 'B' RONALD EBBERTS: Case Summary & 5 Largest Unsecured Creditors ROYAL HAWAIIAN: Case Summary & 20 Largest Unsecured Creditors RPM INTERNATIONAL: Moody's Assigns 'Ba1' Subordinate Shelf Rating RRI ENERGY: Increases Size of Cash Tender Offer SJT VENTURES LLC: Voluntary Chapter 11 Case Summary SMURFIT-STONE: Appoints Tom Gibson as VP of Sheet Feeder Region SMURFIT-STONE: Asks Court to Allow Insurer to Pay Defense Costs SMURFIT-STONE: Canada Hearing on Finance II Interests on Oct. 7 SMURFIT-STONE: CCAA Stay for SSC Canada Extended to Dec. 24 SPANSION INC: Apple Serves Notice to Retain Rights to Spansion IP SPANSION INC: Gets Nod to Continue Ernst & Young's Services SPANSION INC: Giles Delfassy, Director, Acquires Stock SPANSION INC: Jefferies Leveraged Buy Claims SPECTRUM BRANDS: Moody's Assigns Corporate Family Rating at 'B3' STALLION OILFIELD: Reaches Deal in Principle With Working Group STALLION OILFIELD: To File Chapter 11 with Plan to Cut $515MM Debt STANDARD MOTOR: Registration of Securities Declared Effective STANT CORP: Manufacturing Plant May be Sold Next Week STELOR PRODUCTIONS: Case Summary & 20 Largest Unsecured Creditors STEPHEN JOSEPH MAZZERA: Case Summary & 10 Largest Unsec. Creditors SUNBRIDGE PATIO VILLAS: Case Summary & 20 Largest Unsec. Creditors SUN-TIMES MEDIA: Court Approves Sale of Assets to Tyree SUN-TIMES MEDIA: Ritchie Capital Gives Way for Union/Tyree Deal TANA SEYBERT: Proposes to Sell Certain Assets to Unimac Tana TERRI LYNN POLHERT: Case Summary & 20 Largest Unsecured Creditors TETON ENERGY: Forbearance Pact Extended to October 16 THERMOENERGY CORP: Kemp & Company Raises Going Concern Doubt THERMOENERGY CORP: Auditor Raised Going Concern in 2008 Results THORNBURG MORTGAGE: Seeks to Recover Funds From 2 Former Officials TRUE TEMPER: Files Prepackaged Chapter 11 Plan TRUMP ENTERTAINMENT: Competing Plans to Be Sent to Creditors U.S. DEVELOPMENT LAND: Voluntary Chapter 11 Case Summary UAL CORP: Inks Common Stock Underwriting Deal with JPMorgan, et al UAL CORP: Says EETC Offering to Generate $90MM in New Liquidity UTGR INC: Seeks February 28 Extension for Plan Filing UVRP LLC: Files to Reorganize in Reno VALCOM INC: Posts Revised Net Loss of $1.3MM 3rd Quarter VELOCITY EXPRESS: U.S. Trustee Forms Three-Member Committee VERASUN ENERGY: Gets Court Nod to Assign Pact to RBF Acquisition VERASUN ENERGY: Gets Court Nod to Solicit Votes on Plan VERASUN ENERGY: Motion to Approve Sourcegas & Valero Settlement VERTEBRON INC: Cardo Medical Acquires All Assets for $1.3 Million VIASYSTEMS INC: Merix Corp. Deal Won't Affect Moody's 'B3' Rating VIASYSTEMS GROUP: Merix Corp. Deal Won't Affect S&P's B+ Ratings VYTERIS INC: Has Restructuring Deal with Spencer Trask VYTERIS INC: Inks Settlement and Release with Landlord WABASH NATIONAL: Cautiously Optimistic About 2010 Demand Recovery WARNER CHILCOTT: S&P Withdraws 'B+' Rating on $450 Mil. Notes WASHINGTON MUTUAL: Gets Court Nod for Bingham as Tax Counsel WASHINGTON MUTUAL: JPMorgan Gets OK to Intervene in FDIC Suit WATER PIK: Moody's Upgrades Corporate Family Ratings to 'B2' WEATHERSFIELD: Case Summary & 20 Largest Unsecured Creditors WEST CORPORATION: Public Offering Won't Affect Moody's Ratings WESTFALL TOWNSHIP: Board of Supervisors Block 1% Income Tax WOODY HARRELL MEDLOCK: Case Summary & 11 Largest Unsec. Creditors YOURDAY INC: Case Summary & 16 Largest Unsecured Creditors ZUPEK'S INC: Case Summary & 20 Largest Unsecured Creditors * Bank Failures Drive Record Mortgage-Related Closings * Debt-Market Paralysis Deepens Credit Drought * Fed Scrutinizes Effects of Commercial Real Estate Downturn * SEC Says Frank's Derivatives Plan May Leave "Regulatory Gaps" * Clear Thinking Group LLC Partner Resigns * Goldman Sachs Assistant Gen. Counsel Joins Chadbourne & Parke * Sage Holdings Acquires Donlin Recano * SecondMarket Acquires InsideVenture * Thomas Walper Rejoins Munger, Tolles & Olson Bankruptcy Group * BOOK REVIEW: Unique Value: The Secret of All Great Business Strategies ********* 1031 TAX: Settlements-Based Ch. 11 Plan Gets Approval ----------------------------------------------------- The Bankruptcy Court approved the Chapter 11 plan for 1031 Tax Group LLC and, according to the Chapter 11 trustee, distributions of $50 million could being by year's end, Law360 reports. The Bankruptcy Court held a hearing on October 7 to consider approval of the Plan, proposed by Gerard A. McHale, the Chapter 11 trustee. The Plan is built around five groups of settlements with insurers, former 1031 attorneys, former owners of 1031 intermediaries and Wachovia Bank NA, which will provide a total of $92 million in funding for 1031 Tax's Chapter 11 plan. As reported by the TCR on Sept. 4, 2009, under the Plan, holders of general unsecured claims aggregating $150 million will recover 35% of their claims. Holders of these claims identified as "exchangers" will recover up to 44% after giving effect to a class action agreement. Creditors that have higher rank to unsecured creditors will receiver full recovery. Holders of equity interests won't get anything. On the effective date, a liquidating trust will be formed to implement the settlement agreements, and to pursue causes of action. The projected cash balance of the Liquidation Trust as of the effective date is $78,970,000. This amount will be funded by the $70,277,500 collectively payable under the settlement agreements plus cash on hand of $5,897,000 and an anticipated tax refund of $2,800,000. The Plan is being co-proposed by debtor IPofA Shreveport Industrial Park, LLC. The Plan also provides for the reorganization of IPofA Shreveport, which owns the Mineral Servitude (the below-ground rights to exploit the shale gas deposits in a property in Shreveport, LA). The Liquidating Trustee will be the sole member of IpofA Shreveport. Reorganized IPofA Shreveport's activities will relate solely to maximizing any revenues that may be potentially generated or derived from the Mineral Servitude. The Chapter 11 trustee said in its plan that it has pending lawsuits against, or possible settlements with, JPS NH LLC, Boulder Capital LLC, WH Hialeah Investors V, LLC, and Citibank, N.A. The Chapter 11 trustee has also commenced an action against Mr. Okun seeking a judgment in the amount of $150 million. A copy of the August 12 Plan and Disclosure Statement is available for free at http://bankrupt.com/misc/1031_Tax_DS_Plan.pdf About 1031 Tax Group Headquartered in Richmond, Virginia, The 1031 Tax Group LLC -- http://www.ixg1031.com/-- was a privately held consolidated group of qualified intermediaries created to service real property exchanges under Section 1031 of the Internal Revenue Code. The Company and 15 of its affiliates filed for Chapter 11 protection on May 14, 2007 (Bankr. S.D.N.Y. Case No. 07-11447 through 07-11462). Gerard A. McHale, Jr., was appointed Chapter 11 trustee. Jonathan L. Flaxer, Esq., and David J. Eisenman, Esq., at Golenbock Eiseman Assor Bell & Peskoe LLP, represent the Chapter 11 trustee. Kurtzman Carson Consultants LLC acts as claims and notice agent. Thomas J. Weber, Esq., Melanie L. Cyganowski, Esq., and Allen G. Kadish, Esq., at Greenberg Traurig, LLP, represent the Official Committee of Unsecured Creditors. As of Sept. 30, 2007, the Debtors had total assets of $164,231,012 and total liabilities of $168,126,294, resulting in a total stockholders' deficit of $3,895,282. Former CEO Edward H. Okun is in federal prison at Northern Neck Regional Jail in Warsaw, Virginia, after being convicted of mail fraud, among other charges. Mr. Okun allegedly engaged in several misappropriations of funds of 1031 Tax Group and other entities. The funds were used for Mr. Okun's lavish lifestyle including acquiring properties and luxury asset. 945 DEVELOPMENT GROUP: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: 945 Development Group LLC 11000 N Scottsdale Rd Suite 270 Scottsdale, AZ 85254 Bankruptcy Case No.: 09-25101 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- IDG Innovative Development Group LLC 09-25104 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Charles G. Case II Debtor's Counsel: Stanford E. Lerch, Esq. Lerch & Deprima PLC 4000 N Scottsdale Rd, Suite 107 Scottsdale, AZ 85251 Tel: (480) 212-0700 Fax: (480) 212-0705 Email: slerch@ldlawaz.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 Michael A. Lanning, president of the Company. ABITIBIBOWATER INC: Mill Production Cuts to Affect 1,500 Jobs ------------------------------------------------------------- AbitibiBowater related mid-September that it will "suspend production indefinitely" at three Canadian mills and four other mills, including one in the United States, affecting 1,500 Canadian workers, Tara Brautigam of the Canadian Press reported. The cuts, which will begin on October 31, are part of the corporate streamlining implemented by AbitibiBowater, in its restructuring efforts under the bankruptcy protection laws in Canada and the United States, according to the report. Specifically, AbitibiBowater will completely shut down operations at (i) a digital printing paper plant in Beaupre, Quebec, leaving 340 workers without jobs, (ii) one of two newsprint machines in Clermont, Quebec, laying off 120 workers, and (iii) a commercial printing paper machine in Fort Frances, Ontario, rendering 75 people jobless. The Company will also cut half of its production at a newsprint plant in Brooklyn, Nova Scotia, which will result in reduced work hours for 300 employees. Production will also be interrupted in Coosa Pines, Alabama, where the Company will lay off 85 workers, the report further specified. Dave Coles, president of the Communications, Energy and Paperworkers Union of Canada said the closures were preventable and union members were "angry with the company and cynical about their governments," noting that the cuts are "disasters of historical proportions for communities that have been a mainstay of the Canadian forest industry." "The Canadian government had only to put in place a program of loan guarantees for forest companies forced into CCAA protection because of the credit crisis. But clearly, when it comes to our forest industry, nothing is too large to fail, and no economic disaster is too large for government to ignore," Mr. Coles said in a statement, according to The Canadian Press. Pierre Choquette, a spokesman for the AbitibiBowater, attributed the production cuts to "lessening demand." He specified, among other things, that there had been a 30% drop in demand in newsprint since the beginning of the year. Mr. Choquette told the newspaper that it is unclear when the operations would resume. About AbitibiBowater Inc. Headquartered in Montreal, Canada, AbitibiBowater Inc. -- http://www.abitibibowater.com/ -- produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 23 pulp and paper facilities and 29 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade over-the-counter on the Pink Sheets and on the OTC Bulletin Board under the stock symbol ABWTQ. The Company and several of its affiliates filed for protection under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr. D. Del. Lead Case No. 09-11296). Judge Kevin J. Carey presides over the case. The Company and its Canadian affiliates commenced parallel restructuring proceedings under the Companies' Creditors Arrangement Act before the Quebec Superior Court Commercial Division the next day. Alex F. Morrison at Ernst & Young, Inc., was appointed CCAA monitor. Paul, Weiss, Rifkind, Wharton & Garrison LLP, serves as the Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acts as the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serves as the Debtors' co-counsel, while Troutman Sanders LLP in New York, serves as the Debtors' conflicts counsel in the Chapter 11 proceedings. The Debtors' financial advisors are Advisory Services LP, and their noticing and claims agent is Epiq Bankruptcy Solutions LLC. The CCAA Monitor's counsel is Thornton, Grout & Finnigan LLP, in Toronto, Ontario. Abitibi-Consolidated Inc. and various Canadian subsidiaries filed for protection under Chapter 15 of the U.S. Bankruptcy Code on April 17, 2009 (Bankr. D. Del. 09-11348). Judge Carey also handles the Chapter 15 case. Pauline K. Morgan, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, represent the Chapter 15 Debtors. As of Sept. 30, 2008, the Company had $9,937,000,000 in total assets and $8,783,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes AbitibiBowater Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings and parallel proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Abitibibowater Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). ABITIBIBOWATER INC: Paul Weiss Charges $3.3MM for 3.5 Months' Work ------------------------------------------------------------------ Ten professionals retained by AbitibiBowater Inc. and its affiliates filed with the Court their interim quarterly requests for the allowance of fees and reimbursement of expenses for services rendered in these Chapter 11 cases for April through July 2009: Professional Fee Period Fees Expenses ------------ ---------- -------- -------- Paul, Weiss, Rifkind, 4/16/09 to $3,314,539 $183,216 Wharton & Garrison LLP 7/31/09 Blackstone Advisory 4/16/09 to 1,574,000 21,023 Services L.P. 6/30/09 Deloitte Tax LLP 4/16/09 to 726,986 33,647 7/31/09 Huron Consulting LLC 4/16/09 to 715,602 144,724 7/31/09 Troutman Sanders LLP 4/16/09 to 520,639 21,118 7/31/09 Ernst & Young LLP 4/16/09 to 359,174 4,776 6/30/09 PricewaterhouseCoopers 5/11/09 to 305,992 0 LLP, U.S. 7/31/09 Young Conaway Stargatt 4/16/09 to 339,619 90,181 & Taylor, LLP 7/31/09 Hogan Hartson LLP 7/14/09 to 55,325 63 7/31/09 Direct Fee Review LLC 7/14/09 to 2,590 2,072 7/31/09 The Court will consider approval of the Quarterly Fee Applications on November 24, 2009. Objections, if any, must be filed by October 5. About AbitibiBowater Inc. Headquartered in Montreal, Canada, AbitibiBowater Inc. -- http://www.abitibibowater.com/ -- produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 23 pulp and paper facilities and 29 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade over-the-counter on the Pink Sheets and on the OTC Bulletin Board under the stock symbol ABWTQ. The Company and several of its affiliates filed for protection under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr. D. Del. Lead Case No. 09-11296). Judge Kevin J. Carey presides over the case. The Company and its Canadian affiliates commenced parallel restructuring proceedings under the Companies' Creditors Arrangement Act before the Quebec Superior Court Commercial Division the next day. Alex F. Morrison at Ernst & Young, Inc., was appointed CCAA monitor. Paul, Weiss, Rifkind, Wharton & Garrison LLP, serves as the Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acts as the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serves as the Debtors' co-counsel, while Troutman Sanders LLP in New York, serves as the Debtors' conflicts counsel in the Chapter 11 proceedings. The Debtors' financial advisors are Advisory Services LP, and their noticing and claims agent is Epiq Bankruptcy Solutions LLC. The CCAA Monitor's counsel is Thornton, Grout & Finnigan LLP, in Toronto, Ontario. Abitibi-Consolidated Inc. and various Canadian subsidiaries filed for protection under Chapter 15 of the U.S. Bankruptcy Code on April 17, 2009 (Bankr. D. Del. 09-11348). Judge Carey also handles the Chapter 15 case. Pauline K. Morgan, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, represent the Chapter 15 Debtors. As of Sept. 30, 2008, the Company had $9,937,000,000 in total assets and $8,783,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes AbitibiBowater Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings and parallel proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Abitibibowater Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). ABITIBIBOWATER INC: Sierra Liquidity Buys $21,000 Claims -------------------------------------------------------- In separate statements, these entities notified the Court and parties-in-interest that for the period from May 7, 2009 to August 18, 2009, they absolutely and unconditionally sold, conveyed and transferred all their right, title, benefit and interest in these claims, totaling $21,292, to Sierra Liquidity Fund LLC: Claim Transferor Claim No. Amount ---------- --------- ------ Ceramic and Metal Coatings Company undisclosed $14,598 Hach Company undisclosed 1,212 Hach Company undisclosed 1,553 Hach Company undisclosed 1,935 Hach Company undisclosed 26 Industrial Components Co. undisclosed 2,118 Piney Creek Logging undisclosed 4,781 Piney Creek Logging undisclosed 3,549 Ridge Line Timber, Inc. undisclosed 698 Valwood Corporation undisclosed 822 About AbitibiBowater Inc. Headquartered in Montreal, Canada, AbitibiBowater Inc. -- http://www.abitibibowater.com/-- produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 23 pulp and paper facilities and 29 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade over-the-counter on the Pink Sheets and on the OTC Bulletin Board under the stock symbol ABWTQ. The Company and several of its affiliates filed for protection under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr. D. Del. Lead Case No. 09-11296). Judge Kevin J. Carey presides over the case. The Company and its Canadian affiliates commenced parallel restructuring proceedings under the Companies' Creditors Arrangement Act before the Quebec Superior Court Commercial Division the next day. Alex F. Morrison at Ernst & Young, Inc., was appointed CCAA monitor. Paul, Weiss, Rifkind, Wharton & Garrison LLP, serves as the Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acts as the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serves as the Debtors' co-counsel, while Troutman Sanders LLP in New York, serves as the Debtors' conflicts counsel in the Chapter 11 proceedings. The Debtors' financial advisors are Advisory Services LP, and their noticing and claims agent is Epiq Bankruptcy Solutions LLC. The CCAA Monitor's counsel is Thornton, Grout & Finnigan LLP, in Toronto, Ontario. Abitibi-Consolidated Inc. and various Canadian subsidiaries filed for protection under Chapter 15 of the U.S. Bankruptcy Code on April 17, 2009 (Bankr. D. Del. 09-11348). Judge Carey also handles the Chapter 15 case. Pauline K. Morgan, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, represent the Chapter 15 Debtors. As of Sept. 30, 2008, the Company had $9,937,000,000 in total assets and $8,783,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes AbitibiBowater Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings and parallel proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Abitibibowater Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). ACCURIDE CORP: Files Chapter 11 with Restructuring Plan ------------------------------------------------------- Accuride Corporation on October 8 said it has agreed to a balance sheet restructuring with the ad hoc committee of holders of its 8-1/2 percent senior subordinated notes and the steering committee of senior lenders under its credit agreement. In the proposed debt restructuring transaction: * Accuride will amend its existing credit agreement to modify certain financial covenants and extend its maturity through June 30, 2013. * The Notes will be cancelled and noteholders will receive 98% of the common stock of the reorganized Accuride, subject to dilution, including dilution for stock issued upon conversion of the new notes and warrants described below. * The reorganized Accuride will complete a $140 million rights offering of new senior unsecured convertible notes to current noteholders. The rights offering is fully backstopped by certain current Noteholders. The new notes will be convertible into 60 percent of the common stock of the reorganized Accuride. A portion of the proceeds from the rights offering will be used to repay the "last-out" term loan currently held by an affiliate of Sun Capital Partners, with the remainder to provide on-going liquidity for Accuride's business. * Unsecured trade creditors will be unimpaired and their claims will be paid in full. * Current stockholders will receive 2 percent of the common stock of the reorganized Accuride and two-year warrants exercisable for 15 percent of the common stock of the reorganized Accuride, subject to dilution, including dilution for stock issued upon conversion of the new notes. The warrants provide the opportunity for an additional recovery to the prepetition equity holders in the event that the Company reaches certain equity value targets during the two years following the warrants' issue. To complete the proposed restructuring, Accuride's U.S. entities filed a voluntary petition for protection under Chapter 11 of the U.S. Bankruptcy Code and are seeking approval for the proposed plan of reorganization. Accuride's Canadian and Mexican subsidiaries are not included in the bankruptcy filing. All operations will continue to operate "business as usual." With the prearranged agreement Accuride is hopeful that it will be able to emerge from bankruptcy on an expedited basis with a confirmed plan of reorganization. To ensure that Accuride will continue conducting its business in the ordinary course without interruption, the Company has secured a $50 million "debtor-in-possession" credit facility to be provided by certain of its senior lenders and noteholders. The financing will provide peace of mind to Accuride's customers and suppliers and allow the Company to maintain or restore normal trade terms with suppliers. "Accuride's debt restructuring efforts are designed to create a sustainable capital structure that will support greater profitability and solidify the Company's position as the market leader in its product categories," said Bill Lasky, Accuride's President, CEO, and Chairman of the Board. "Accuride expects to quickly emerge from Chapter 11 having rationalized its capital structure and de-levered its balance sheet. I believe this restructuring transaction maximizes our financial flexibility and positions Accuride for future growth." About Accuride Corp. Accuride Corporation (OTCBB: AURD) -- http://www.accuridecorp.com/ -- is one of the largest and most diversified manufacturers and suppliers of commercial vehicle components in North America. Accuride's products include commercial vehicle wheels, wheel-end components and assemblies, truck body and chassis parts, seating assemblies and other commercial vehicle components. Accuride's products are marketed under its brand names, which include Accuride, Gunite, Imperial, Bostrom, Fabco, Brillion, and Highway Original. As of June 30, 2009, the Company had $704.7 million in total assets; $732.0 million in total current liabilities and $114.0 million in other liabilities; and $141.4 million in stockholders' deficiency. As reported by the TCR on September 7, 2009, Moody's Investors Service lowered Accuride's Probability of Default Rating and Corporate Family Rating to Ca\LD and Ca, respectively. Moody's believes that the company's continued financial difficulties increase the likelihood of a distressed exchange or a bankruptcy filing as the company seeks to restructure its business AEP INDUSTRIES: Moody's Upgrades Corporate Family Rating to 'B1' ---------------------------------------------------------------- Moody's Investors Service upgraded the corporate family rating of AEP Industries Inc to B1 from B2 and revised the rating outlook to stable from negative. Other instrument ratings are detailed below. The upgrade reflects the significant improvement in operating performance, credit metrics and liquidity over the last twelve months. AEP has successfully integrated the Atlantis acquisition, cut costs and executed in a challenging competitive environment. The dedication of free cash flow to debt reduction has returned debt to the pre-acquisition level while cash flow continues to benefit from incremental sales and synergies from the acquisition. The repayment of revolver borrowings used to finance the acquisition has significantly improved liquidity as well. While continued softness may drag on operating performance over the near term, the company's low leverage and strong interest coverage, free cash flow and liquidity provide some cushion to the rating. Additionally, AEP's continuing focus on rational pricing, cost cutting and debt reduction also support the rating. The rating on the $160 million senior secured notes due 2013 is sensitive to an increase in the borrowing base under the asset based revolver (not rated by Moody's). Any increase in the borrowing base beyond the modeled amount could cause the instrument to be notched down to B3 according to the Loss Given Default methodology. Moody's took these rating actions for AEP: * Upgrade $160 million senior notes, due 2013, B2 (LGD 5, 75%) from B3 (LGD 5, 76%) * Upgrade corporate family rating, B1 from B2 * Upgrade probability of default rating, B1 from B2 The ratings outlook is revised to stable from negative. Moody's last rating action on AEP occurred on January 22, 2009 when Moody's downgraded the corporate family rating to B2 from B1 and revised the outlook to negative from stable. AEP Industries Inc is a producer of polyethylene, polyvinyl chloride and polypropylene flexible packaging products for transportation, food and beverage, automotive, pharmaceutical, chemical, electronics, construction, agriculture and textile industries. Headquartered in South Hackensack, N.J., AEP had consolidated revenues of approximately $753 million in the twelve months ended July 31, 2009. AIRTRAN HOLDINGS: S&P Assigns 'CCC-' Rating on $75 Mil. Notes ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'CCC-' rating to senior to Orlando, Florida-based AirTran Holdings Inc.'s (CCC+/Positive/--) $75 million convertible senior notes due 2016. S&P also assigned its '6' recovery rating, indicating negligible (0-10%) recovery in a payment default to the notes. At the same time, S&P affirmed its 'CCC+' long-term corporate credit rating on AirTran and revised the outlook to positive from stable. "The outlook revision reflects improved liquidity and continuing satisfactory operating performance in a difficult airline industry environment," said Standard & Poor's credit analyst Philip Baggaley. "The notes and a concurrent offering of nine million shares of common stock (about $45 million) provide a material boost to AirTran's liquidity (unrestricted cash and short-term investments were $387 million as of June 30, 2009)," he continued. The ratings on AirTran reflect a modest competitive position in the U.S. airline industry and a highly leveraged financial profile. The ratings on AirTran also incorporate benefits of its relatively low operating costs. Continued profitability that results in funds flow to total debt consistently above 10% could result in a modest upgrade over the next year. If unrestricted cash and credit line availability decline to below $250 million, or if S&P believes that earnings and the cash flow outlook are likely to lead to such a result, S&P could lower the ratings. S&P would consider a stable outlook if operating results lead to funds flow to debt in the mid-single- digit percent range. ALASKA LODGES: Fishing Lodge to Be Sold to Pay KeyBank ------------------------------------------------------ James Thorner at St. Petersburg Times reports that Alaska Lodges Inc.'s Merrill Wood has proposed selling an Alaskan fishing lodge property to fend off bankruptcy creditors. Mr. Wood bought Fishing Unlimited Lodge in Port Alsworth, Alaska, in 2000. He suggested clearing more than $1 million in debts to Alaska's KeyBank by selling off his nine-cabin lodge 160 miles southwest of Anchorage, St. Petersburg Times states. St. Petersburg, Florida-based Alaska Lodges, Inc., dba Alaska's Fishing Unlimited Lodge filed for Chapter 11 bankruptcy protection on July 13, 2009 (Bankr. M.D. Fla. Case No. 09-14966). Camille J. Iurillo, Esq., at Iurillo & Associates PA, assists the Company in its restructuring efforts. The Company listed $3,146,712 in assets and $1,732,462 in liabilities. AMAPOLA ORANGE: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Amapola Orange, LLC 317 Mahogany St. Hemet, CA 92543 Bankruptcy Case No.: 09-28798 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtor's Counsel: Charles M. Damus, Esq. Damus & Associates 624 S 6th St Las Vegas, NV 89101 Tel: (702) 382-5034 Fax: (702) 384-9289 Email: c.damus@damuslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $6,793,264, and total debts of $5,000,000. The Company says it does not have unsecured creditors who are non insiders when it filed its petition. The petition was signed by Edith Cserni, managing member of the Company. AMERICAN COMMUNITY: Chapter 11 Case Dismissed by Judge ------------------------------------------------------ According to Michael Bathon at Bloomberg News, the Bankruptcy Court Judge Kevin Carey has ordered the dismissal of the Chapter 11 cases of American Community Newspapers LLC, after creditors said there was no possibility of rehabilitation. The Bank of Montreal, Chicago Branch, has objected to the request to dismiss American Community's Chapter 11 bankruptcy case. Bank of Montreal argued that dismissal of the Chapter 11 case is not in the best interests of the approximately 3% of remaining general unsecured creditors, who would benefit more from "conversion rather than dismissal" of the Debtor's case. As reported by the TCR on August 6, 2009, the official committee of unsecured creditors of American Community Newspapers has asked the Bankruptcy Court to dismiss the Chapter 11 case. The Committee argues that "the [D]ebtors' cases were never commenced with the intention or purpose of pursuing a Chapter 11 plan process." American Community had earlier asked the Court to convert its bankruptcy case to a liquidation under Chapter 7. The Debtor says that it has no funds to maintain its Chapter 11 case. American Community sold its assets in June. The secured lenders, owed $107 million on a term loan and revolving credit, acquired the assets for a $32 million credit against the loan. They also agreed to pay the cost of curing defaults on contracts they took over plus whatever was outstanding on the $5 million credit for Chapter 11 case that required a quick sale. Headquartered in Addison, Texas, American Community Newspapers LLC -- http://www.americancommunitynewspapers.com/-- had 86 newspapers, 14 other publications, and 85 Web sites serving Minneapolis-St. Paul, Dallas, suburban Washington and Columbus, Ohio. The Company's award winning group of 86 newspapers and fourteen niche publications reached approximately 1.4 million households in the suburban communities surrounding these major cities and enjoys market leading circulation penetration in all of its markets. The Company and four of its affiliates filed for Chapter 11 protection on April 28, 2009 (Bankr. D. Del. Lead Case No. 09-11446). Landis Rath & Cobb LLC and Lowenstein Sandler PC represents the Debtors in their restructuring efforts. The Debtors proposed Carl Marks & Co. Inc. as financial advisor, and Graubard Miller as special corporate counsel. When the Debtors filed for protection from their creditors, they listed assets between $50 million and $100 million, and debts between $100 million and $500 million. AMERICAN REPROGRAPHICS: S&P Affirms 'BB-' Corporate Credit Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings, including its 'BB-' corporate credit rating, on Walnut Creek, California- based American Reprographics LLC, the largest U.S. provider of outsourced reprographics and related business services. The rating outlook remains negative. The ratings affirmation follows the company's announcement yesterday that it had successfully negotiated an amendment to its senior secured credit facility, which included several provisions that, in S&P's view, moderately improve ARC's credit profile. The company also announced that it has revised its 2009 earnings per share guidance downward to the range of $0.27 to $0.33 (excluding one-time charges related to the amendment) from a range of $0.50 to $0.70. Management suggested that the revised earnings guidance points to a 2009 revenue range of $485 million to $495 million, which is somewhat worse than S&P's previous expectation of about $520 million. Given trends this year and Standard & Poor's economists' expectations for nonresidential construction spending to decline by another 17% in 2010, S&P has revised its estimates and now expect American Reprographics' revenue to decline by about 30% (from S&P's previous expectation of about 25%) in 2009, and in the low-teens percentage area next year. "Despite S&P's lowered expectations for 2009 and 2010 performance, S&P anticipate that credit measures will remain in line with the 'BB-' rating," said Standard & Poor's credit analyst Liz Fairbanks. "We expect that EBITDA declines will be limited to the high-30% area in 2009 and the mid-teens area in 2010, due to successful cost-cutting measures that the company has already implemented." The company prepaid $35 million of its term loan in conjunction with the amendment announced yesterday, and S&P expects ARC to continue to use free cash flow to repay debt as long as the operating environment continues to be weak. For the 12 months ended June 2009, S&P's measure of total lease-adjusted debt to EBITDA was 3.0x. With about $55 million of total debt repayment expected this year, which includes the $35 million prepayment and about $20 million of scheduled amortization, S&P expects leverage to increase to the low- to mid-3x area by December and to peak in the mid-3x area in 2010. With the announced 200-basis-point increase in interest costs, partially offset by the lower debt balances, S&P expects its measure of adjusted coverage to remain in the mid- to high-3x area over the intermediate term. AMERICAN TREE CO: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: American Tree Co., Inc. 663 St. Rt. 149 PO Box 786 Lake George, NY 12845 Bankruptcy Case No.: 09-13753 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Northern District of New York (Albany) Judge: Chief Judge Robert E. Littlefield Jr. Debtor's Counsel: Christian H. Dribusch, Esq. Patroon Building 5 Clinton Square Albany, NY 12207 Tel: (518) 436-1662 Fax: (518) 432-1996 Email: cdribusch@nycap.rr.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of $2,668,173, and total debts of $1,362,390. The Company says it does not have unsecured creditors who are non insiders when they filed their petition. The petition was signed by Daniel Stranahan, president of the Company. AMERITYRE CORP: Auditors Express Going Concern Opinion ------------------------------------------------------ Amerityre Corporation said on Oct. 5, as required by Nasdaq Marketplace Rule 5250(b)(2), its previously filed consolidated financial statements for the fiscal year ended June 30, 2009, included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on September 28, 2009, contained a going concern qualification from its independent registered public accounting firm. Nasdaq Marketplace Rule 5250(b)(2) requires separate public disclosure of a previously issued audit opinion that contains a going concern qualification. Amerityre Corporation (Nasdaq: AMTY) -- http://www.amerityre.com/ -- is engaged in the research and development of technologies related to the formulation of polyurethane compounds and the manufacturing process for producing tires from polyurethane. The Company's polyurethane material technology is based on two formulations: the closed-cell polyurethane foam, which is a lightweight material with high load-bearing capabilities for light-use applications, and Elastothane, a polyurethane elastomer with high load-bearing capabilities suitable for heavy-use applications. The Company is developing tires and treads for tires using Elastothane for a range of applications. In March 2008, the Company acquired molds and models from a manufacturer of polyurethane foam tires, Kik Technology, Inc. ANGIOTECH PHARMACEUTICALS: S&P Raises Corp. Credit Rating to 'CCC' ------------------------------------------------------------------ Standard & Poor's Ratings Services said it raised its long-term corporate credit rating on Vancouver-based Angiotech Pharmaceuticals Inc. by two notches to 'CCC' from 'CC'. The outlook is negative. At the same time, S&P raised its rating on the company's US$325 million senior unsecured notes two notches to 'CCC' (the same as the corporate credit rating on Angiotech) from 'CC'. The recovery rating on the unsecured notes is unchanged at '4', indicating S&P's expectation of average (30%-50%) recovery in a default scenario. Furthermore, S&P raised its rating on the company's US$250 million senior subordinated notes to 'CC' (two notches below the corporate credit rating) from 'C'. The recovery rating on the subordinated notes is unchanged at '6', indicating S&P's expectation of negligible (0%-10%) recovery in a default scenario. Finally, S&P removed all the ratings from CreditWatch with positive implications, where they were placed June 25, 2009. "The upgrade reflects what S&P considers to be Angiotech's reduced risk of default in the near term because of the improvement in its liquidity position, which has enabled the company to continue operations," said Standard & Poor's credit analyst Lori Harris. Earlier this year, Angiotech received US$25 million as consideration for the Amended and Restated Distribution and License Agreement with Baxter International Inc. (A+/Positive/A- 1). In addition, the company obtained a new US$25 million revolving credit facility due 2013. As a result, Angiotech had US$52 million in cash/short-term investments and no drawings under the revolving credit facility at June 30, 2009. Still, despite management's efforts to cut costs, the company remained cash flow negative for the 12 months ended June 30. "The ratings on Angiotech reflect S&P's view of the company's limited financial flexibility, highly leveraged capital structure, tightening financial covenants, and uncertainty regarding the timing and extent of revenue growth from new products," Ms. Harris added. Angiotech is a specialty pharmaceutical company whose core strength is adding pharmaceutical compounds to medical devices used by surgeons. The company's business is largely broken down into two segments: medical products and pharmaceutical technologies. The negative outlook reflects Standard & Poor's expectation that Angiotech's financial flexibility and credit ratios will remain weak in the next year, driven by elevated debt levels and negative free cash flow. S&P could lower the ratings if the company's liquidity position weakens or if it does not comply with its financial covenants and is unable to obtain an amendment or waiver to rectify the situation. Conversely, S&P could revise the outlook to stable if the contribution from new products or divestment of assets leads to an improvement in free cash flow generation. ASARCO LLC: Parent Renews Request for Stay of SCC Reimbursement --------------------------------------------------------------- Americas Mining Corporation and Asarco Incorporated further renew their request to stay, pending appeal, the order entered on April 15, 2009, by the U.S. District Court for the Southern District of Texas, Brownsville Division, approving the expense reimbursement in connection with the auction and proposed sale in favor of ASARCO LLC, in the litigation against AMC relating to shares of Southern Peru Copper Company, now known as Southern Copper Corporation. On September 17, 2009, the District Court ruled "that all appellate briefing is stayed pending entry of a Final Confirmation Order" in the Debtors' bankruptcy cases. The Parent now requests that the stay of the Reimbursement Order be extended through the pendency of its appeal of the Reimbursement Order -- as originally contemplated in the Original Stay Motion. In the alternative, the Parent seeks that the stay be extended pending entry of a Final Confirmation Order. Charles A. Beckham, Jr., Esq., at Haynes and Boone, LLP, in Houston, Texas, relates that since the Original Stay Motion was approved, Judge Schmidt has entered reports all recommending that the District Court enter a Final Confirmation Order confirming the Parent's Plan. For the same reasons that the Bankruptcy Court entered the initial Stay Order and the renewed Stay Order, a further stay of the Reimbursement Order is warranted, Mr. Beckham contends. "Such a stay would be consistent with the District Court's order staying all appellate briefing pending entry of a Final Confirmation Order," he points out. 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. 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). 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) ASARCO LLC: Plan Solicitation Deadline Moved to Dec. 31 ------------------------------------------------------- Judge Richard Schmidt has granted an extension of the exclusive period to solicit acceptances of plans of reorganization for Asarco LLC through December 31, 2009. The exclusive period will continue as to ASARCO LLC, Grupo Mexico's Asarco Incorporated and Americas Mining Corporation, and Harbinger Capital Partners Master Fund I, Ltd., to allow them to pursue confirmation of their competing plans and solicit acceptances of those plans. Bankruptcy Judge Favors Grupo Plan As reported by the TCR on Sept. 25, 2009, Bankruptcy Judge Richard Schmidt stuck with his original decision that ASARCO LLC should emerge from bankruptcy with Grupo Mexico LLC's proposed Chapter 11 plan and bid to regain control of its unit. On August 31, Judge Schmidt issued a decision that Grupo's Mexico offer was superior to Asarco LLC's plan, which was built around a sale of the business to Sterlite Industries (India) Ltd., a unit of India's Vedanta Resources Plc. But after Judge Schmidt entered an decision recommending to District Court Judge Andrew S. Hanen to recommend Grupo's plan, Sterlite beefed up its offer for the business and stated that it would release Grupo from a $8 billion liability in connection with the $9.13 billion judgement against Grupo in connection with the suit that it forced its unit to sell shares in Southern Peru Copper Company, now known as Southern Copper Corporation. In a September 24 ruling, Judge Schmidt, however, rejected Sterlite's request that its bid, made after he made his Aug. 31 decision, should be considered by the federal judge who will decide which company gets Asarco. Letting Sterlite revise its bid would be "fundamentally unfair," he said. Judge Schmidt also said that Grupo's failure to reach an agreement with the United Steel Workers does not render its plan unfeasible. He said that the risk of a union strike is overstated. Grupo Mexico and Sterlite have filed full-payment plans, each promising to return full principal and interest to the creditors. ASARCO LLC's plan sells the assets to Sterlite for $1.44 billion in cash plus $722 million to monetize the SCC Litigation Trust. In its plan, Grupo Mexico will contribute to the Debtor $2.2 billion cash. A copy of Judge Schmidt's latest recommendation to the District Court is available for free at: http://bankrupt.com/misc/Asarco_Schmidt_Amended_Order.pdf District Judge Hanen is expected to rule on the Plan in November 2009. The Debtors are expected to emerge from bankruptcy by the end of 2009 should Judge Hanen accept the Bankruptcy Court's recommendation, Grupo Mexico SAB said. About ASARCO LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. 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. 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). 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) ASARCO LLC: Sterlite, Union Oppose Recommendation on Grupo Plan --------------------------------------------------------------- Several key parties of the Debtors' bankruptcy cases filed separate supplemental objections against Judge Richard S. Schmidt's report and recommendation to District Court Judge Andrew S. Hanen (i) not to consider the Post-Recommendation Plan of Reorganization filed by the Debtors on September 10, 2009, or (ii) in the alternative, if the District Court considers the Post- Recommendation Plan, to confirm the Plan proposed by Asarco Incorporated and Americas Mining Corporation. The objecting parties are: -- ASARCO LLC and its Subsidiary Debtors; -- Sterlite (USA), Inc., and Sterlite Industries (India) Ltd.; -- the state of Arizona; and -- the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union AFL-CIO. As previously reported, Judge Schmidt has recommended the confirmation of the Parent Plan saying that it achieves good objective consequences because it provides a cash recovery in full satisfaction of creditor's claims, the greatest immediate recovery to various constituencies, and certainty of funding. The Parent's Plan, valued at $3.6 billion, complies with all of the requirements of the Bankruptcy Code and should be confirmed, Judge Schmidt opined in a 137-page report and recommendation dated August 31, 2009. Certain parties supporting the Debtors' Plan have filed objections to the original recommendation. The Debtors eventually filed their Post-Recommendation Plan on September 10, 2009, to further compete with the Parent Plan. Full-text copies of the objections are available for free at: * http://bankrupt.com/misc/ASARCO_Obj_2ndReport_Debtors.pdf * http://bankrupt.com/misc/ASARCO_Obj_2ndReport_Sterlite.pdf * http://bankrupt.com/misc/ASARCO_Obj_2ndReport_Arizona.pdf * http://bankrupt.com/misc/ASARCO_Obj_2ndReport_USW.pdf Supplemental Objections A. Debtors Although Sterlite made its proposal to give the U.S. Bankruptcy Court for the Southern District of Texas and creditors the benefit of additional consideration after Judge Schmidt's Original Recommendation, ASARCO LLC and its debtor affiliates say the District Court should still consider the ASARCO-Sterlite Post- Recommendation Plan. The competition in these bankruptcy cases has led to the proposal of two full payment plans filed by the Debtors and the Parent, Jack L. Kinzie, Esq., at Baker Botts L.L.P., in Dallas, Texas, notes. That continued competition, he asserts, will best assure that both Plans remain for the District Court to consider and that the Plan chosen by the District Court actually closes. In this light, the Debtors object to the Bankruptcy Court's Second Recommendation and urge the District Court to consider their Post- Recommendation Plan. Aside from providing greater immediate cash recoveries to certain creditors, the Post-Recommendation Plan also ensures the continued viability of the Sterlite option not to terminate the New Plan Sponsor Purchase and Sale Agreement under the Debtors' Plan if the District Court does not adopt the Bankruptcy Court's recommendation, or if the Parent fails to close its Plan if confirmed, Mr. Kinzie points out. The filing of the Post-Recommendation Plan serves a necessary purpose and is not a product of gamesmanship, Mr. Kinzie contends. The Post-Recommendation Plan will not cause delay for the Debtors do not seek to reopen the evidence, otherwise alter the schedule for review by the District Court, or delay resolution of the bankruptcy cases, he maintains. B. Sterlite Entities Douglas P. Bartner, Esq., at Shearman & Sterling LLP, in New York, tells Judge Schmidt that Sterlite and the Debtors submitted the Post-Recommendation Plan for further review by the District Court with the aim of clarifying and resolving a limited set of errors and disputes regarding the consideration provided under the Debtors' Original Plan. Similarly, he adds, the stipulations made by Sterlite in its supplemental brief are intended to further minimize disputed issues and to eliminate potential delays in the confirmation process. Accordingly, Mr. Bartner asserts, the Stipulations and the Post- Recommendation Plan will facilitate the District Court's decision- making process and will expedite confirmation by resolving factual disputes that were not addressed by the Bankruptcy Court, and doing so in a manner that is not prejudicial to any party involved. Consideration of the Stipulations and the Post-Recommendation Plan is permitted under applicable law and is in the best interests of the Debtors' creditors and other stakeholders, Mr. Bartner argues. He adds that the consideration will conserve judicial resources by narrowing the disputes truly at issue at this point to a pair of critical legal questions: (1) Can the Parent's Plan be confirmed notwithstanding the Parent's failure to negotiate an agreement with the United Steel Workers and in light of the plain language and clear intent of the Special Successorship Clause, which require the Parent to have done so? (2) Does the Bankruptcy Code provide that a bid supported by an equity holder must be confirmed if the bid provides for payment of allowed claims of creditors in full, notwithstanding that the creditors overwhelmingly prefer an alternative bid that provides them superior economic and non-economic treatment? Mr. Bartner further argues that the Post-Recommendation Plan should be considered because it was submitted to address errors, will not result in delay, and is permitted under the plain language of Section 1127(a) of the Bankruptcy Code. It should also be considered along with the Stipulations to expedite the confirmation process and eliminate judicial errors, he adds. C. USW The United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union AFL-CIO adopts by reference the supplements to the objections filed by the Debtors, Sterlite (USA), Inc., Sterlite Industries (India) Ltd., and the state of Arizona. The USW says it recognizes the Bankruptcy Court's obvious concern with an expeditious exit from bankruptcy, often expressed as a concern regarding a delay in confirmation of the Parent's Plan. However, the USW argues that as the Supreme Court has warned, while "[o]ne can easily sympathize with the desire of a Court to terminate bankruptcy reorganization proceedings, for they are frequently protracted," the "need for expedition" is "not a justification for abandoning proper standards," citing Protective Comm. for Indep. Stockholders of TMT Trailer Ferry, Inc. v. Anderson, 390 U.S. 414, 450 (1968). A philosophical view as to whether ASARCO's employees have been treated equitably, or whether the Parent has offered to pay a sufficient amount to recompense for its misdeeds, is not a substitute for conclusions mandated by an appropriate analysis of the facts and controlling law, Patrick M. Flynn, Esq., in Houston, Texas, contends. He points out that USW's objection raise several issues, including the concern that the Parent Plan cannot be confirmed because it is in violation of the Special Successorship Clause of the 2007 collective bargaining agreement between the USW and the Debtors, which constitutes the law of the case. The facts and law mandate that the District Court honor the requirements of the SSC, confirm that Debtors' Plan, and thereby bring about a successful culmination of the bankruptcy that is both expeditious and consistent with the law, Mr. Flynn asserts. D. State of Arizona The state of Arizona alleges that in coming to his findings, Judge Schmidt did not adequately consider the long-term feasibility of Parent's Plan and its ability to successfully carry out ASARCO's operations without returning to the shelter of the Bankruptcy Court. Arizona insists that the Debtors' Plan provides the greatest opportunity for long-term financial success of the new operating company. At Arizona's behest, Judge Hanen has allowed the State to file a late objection to the Bankruptcy Court's Recommendation. Rick Zeise, Esq., of the Office of the Arizona Attorney General, in Phoenix, Arizona, asserts that the Bankruptcy Court must consider whether confirmation of a plan is likely to be followed by the need for further financial reorganization of the debtor. He argues that the capital structure under the Parent's Plan proposes a capital structure that saddles the Reorganized ASARCO with a $1.3 billion borrowing, which will require quarterly payments of $45 million beginning six months after closing, increasing to $98 million per quarter beginning one year after closing. The Parent's Plan also overloads Reorganized ASARCO with the repayment of the $280 million Asbestos Note within one year after closing, Mr. Zeise contends. He cites that the Parent's Plan leaves Grupo Mexico and AMC highly leveraged; there is no certainty that either will be able to fund the $200 million working capital facility or fund the employees' pension and retirees' medical benefits as the amounts become due in the future. "The proposed Capital Structure saddles the reorganized Debtor with obligations requiring it to upstream dividends and sale proceeds to the Parent to pay off the borrowing facility used to fund the Plan," Mr. Zeise tells Judge Schmidt. "The Debtor would also be responsible to insure that all creditors are paid in full," he adds, among other things. The District Court will commence a hearing on October 19, 2009, to consider the objections. Judge Hanen says that anyone who wishes to be heard with respect to the confirmation of the Plans must be in court because the District Court will not allow telephonic participation. Parent Responds ASARCO Incorporated and Americas Mining Corporation submitted to the Court a 63-page brief in support of, and in response to the objections filed to, Judge Schmidt's Report and Recommendations favoring the Parent's Plan. The Parent asserts that the issues in the matter are whether the District Court should: (i) adopt the Bankruptcy Court's recommended findings of fact and conclusions of law; (ii) overrule objections to the Bankruptcy Court's Recommendation, and (iii) reject the Debtors' Plan and confirm the Parent's Plan. Based on the law and evidence, and extensive supplemental briefing and argument invited by the Bankruptcy Court, Judge Schmidt has now twice recommended confirmation of the Parent's Plan, which will pay all creditors in full in cash, including postpetition interest, and allow the current equity holder to retain its interest in ASARCO, relates Charles A. Beckham, Jr., Esq., at Haynes and Boone, LLP, in Houston, Texas. He notes that in recommending the Parent's Plan for confirmation, the Bankruptcy Court provided extensive findings and conclusions, explaining the reasons for preferring the Parent Plan over the Debtors' Plan. Specifically, the Bankruptcy Court found that the Parent's Plan is feasible and proposed in good faith, and that the Parent has demonstrated its full commitment to consummating the Parent's Plan by, among other things, transferring cash and securities with a value of $2.9 billion into a forfeitable escrow account to support its funding obligations, Mr. Beckham contends. Most importantly, he asserts, the Bankruptcy Court concluded that the Parent Plan is superior to the Debtors' Plan, and that the confirmation of the Parent Plan, "will culminate perhaps the most successful major bankruptcy reorganization in history." The Parent, hence, asks the District Court to adopt the findings of fact and conclusions of law contained in Judge Schmidt's Recommendation, confirming the Parent's Plan and denying confirmation of the various iterations of the Plan filed by the Debtors, at least one of which was filed after the closing of the Confirmation Hearing trial. "The Bankruptcy Court's recommended findings of fact should be reviewed only for 'clear error,'" Mr. Beckham tells the District Court. "The Bankruptcy Court is entitled to great deference in judging the credibility of witnesses, and in interpreting the meaning and intent of its own orders." Mr. Beckham argues that none of the Objecting Parties has identified any new issues of law or fact that were not before the Bankruptcy Court prior to the issuance of the Plan Recommendation, and none of the evidentiary complaints undermine the Bankruptcy Court's findings, based on the substantial evidence presented at the Confirmation Hearing, in support of confirmation of the Parent's Plan. Instead, he alleges, the Objecting Parties attempt to rehash arguments the Bankruptcy Court already has rejected in two separate recommendations and ask the District Court to substitute their views of the record and the law for the Bankruptcy Court's sound judgment. In doing so, Mr. Beckham contends, the Objecting Parties ignore direct evidence and reasonable inferences that support the Bankruptcy Court's extensive findings and conclusions in favor of the confirmation of the Parent's Plan, and the standards by which the Recommendation should be reviewed. He argues that the Objections are meritless, and the District Court should not allow the Objecting Parties to thwart the successful confirmation and consummation of the Parent's Plan. "Ironically, of the few remaining [Objecting Parties], the most persistent appears to be Sterlite, a disgruntled third party bidder and a stranger to these Chapter 11 cases that is not a 'party in interest' and has no standing to object to confirmation of the Parent's Plan," Mr. Beckham points out. "Sterlite's objections should not be considered." Mr. Beckham notes that despite the Bankruptcy Court's Recommendation that the untimely Debtors' Post-Recommendation Plan should not be considered and that it remains inferior to the Parent's Plan, certain of the Objecting Parties now attempt an end-run around the Bankruptcy Court's clear rulings and ask the Bankruptcy Court to consider the Post-Recommendation Plan, despite the fact that it was not subject to discovery or other testing before the Bankruptcy Court. Mr. Beckham maintains that Judge Schmidt thoroughly reviewed the Post-Recommendation Plan and the circumstances of its submission, and found no legal authority or reason to consider that Plan. Mr. Beckham reiterates that the Bankruptcy Court noted that consideration of the Debtors' Post-Recommendation Plan, filed after the Debtors' Plan had been rejected as inferior and inconsistent with the objectives of the Bankruptcy Code, would require reopening the confirmation trial to afford the Parent due process, and would threaten to delay or derail the orderly confirmation process that the District Court envisioned and to which the Parent, the Debtors, and Sterlite agreed. He adds that the Bankruptcy Court found that even if the Post-Recommendation Plan were considered, the Parent's Plan remains the superior plan and should be confirmed. Accordingly, the Parent asks the District Court to adopt the Bankruptcy Court's Recommendation, and to confirm the Parent's Plan to bring the Debtors' bankruptcy cases to a prompt conclusion. Bankruptcy Judge Favors Grupo Plan As reported by the TCR on Sept. 25, 2009, Bankruptcy Judge Richard Schmidt stuck with his original decision that ASARCO LLC should emerge from bankruptcy with Grupo Mexico LLC's proposed Chapter 11 plan and bid to regain control of its unit. On August 31, Judge Schmidt issued a decision that Grupo's Mexico offer was superior to Asarco LLC's plan, which was built around a sale of the business to Sterlite Industries (India) Ltd., a unit of India's Vedanta Resources Plc. But after Judge Schmidt entered an decision recommending to District Court Judge Andrew S. Hanen to recommend Grupo's plan, Sterlite beefed up its offer for the business and stated that it would release Grupo from a $8 billion liability in connection with the $9.13 billion judgement against Grupo in connection with the suit that it forced its unit to sell shares in Southern Peru Copper Company, now known as Southern Copper Corporation. In a September 24 ruling, Judge Schmidt, however, rejected Sterlite's request that its bid, made after he made his Aug. 31 decision, should be considered by the federal judge who will decide which company gets Asarco. Letting Sterlite revise its bid would be "fundamentally unfair," he said. Judge Schmidt also said that Grupo's failure to reach an agreement with the United Steel Workers does not render its plan unfeasible. He said that the risk of a union strike is overstated. Grupo Mexico and Sterlite have filed full-payment plans, each promising to return full principal and interest to the creditors. ASARCO LLC's plan sells the assets to Sterlite for $1.44 billion in cash plus $722 million to monetize the SCC Litigation Trust. In its plan, Grupo Mexico will contribute to the Debtor $2.2 billion cash. A copy of Judge Schmidt's latest recommendation to the District Court is available for free at: http://bankrupt.com/misc/Asarco_Schmidt_Amended_Order.pdf District Judge Hanen is expected to rule on the Plan in November 2009. The Debtors are expected to emerge from bankruptcy by the end of 2009 should Judge Hanen accept the Bankruptcy Court's recommendation, Grupo Mexico SAB said. About ASARCO LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. 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. 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). 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) AURA SYSTEMS INC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Aura Systems Inc. 2345 E. Garfield Ave. Decatur, IL 62526 Bankruptcy Case No.: 09-72982 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Central District of Illinois (Springfield) Judge: Mary P. Gorman Debtor's Counsel: Andrew Bourey, Esq. 101 S Main, St. #501 Decatur, IL 62523 Tel: (217) 422-2400 Email: bkmail@boureylaw.com Estimated Assets: $50,001 to $100,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of $94,722, and total debts of $1,258,804. 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/ilcb09-72982.pdf The petition was signed by Mark L. Sadorus, president of the Company. AVIS BUDGET: Offers $300MM of 3.50% Convertible Senior Notes ------------------------------------------------------------ Avis Budget Group, Inc., intends to offer $300 million aggregate principal amount of 3.50% convertible senior notes due 2014. The notes were offered and sold solely to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The offering is expected to close on October 13, 2009. Avis Budget has also granted the initial purchasers of the notes the right to purchase up to an additional $45 million aggregate principal amount of notes solely to cover over-allotments. In an earlier release, Avis Budget Group said it intended to offer $250 million aggregate principal amount of convertible senior notes; and grant the initial purchasers of the notes the right to purchase up to an additional $37.5 million aggregate principal amount of notes to cover overallotments. The initial conversion rate for the notes is 61.5385 shares of common stock per $1,000 principal amount of the notes, which is equal to an initial conversion price of approximately $16.25 per share, representing a 30% conversion premium above the October 7 closing price of Avis Budget's common stock of $12.50 per share. The notes mature October 1, 2014. Avis Budget will settle any conversion of the notes through the delivery of shares of its common stock. Avis Budget intends to simultaneously enter into a warrant transaction and to purchase a convertible note hedge. The Company intends to use approximately 10% of the net proceeds from the offering to pay the cost of the convertible note hedge (after such cost is partially offset by the proceeds from the warrant transaction) and to use the balance for general corporate purposes, including the repayment of debt. The effect of the convertible note hedge and warrant transaction, or "call spread", will be to increase the effective conversion premium of the notes from the Company's perspective to 80% above today's closing price of Avis Budget's common stock. Avis Budget has been advised by the counterparties to the call spread that they intend to hedge their exposure under the call spread by entering into various derivative transactions concurrently with pricing of the offering, which may have an effect on the market price of Avis Budget's common stock. About Avis Budget Group Avis Budget Group (NYSE: CAR) -- http://www.avisbudgetgroup.com/ -- provides vehicle rental services, with operations in more than 70 countries. Through its Avis and Budget brands, the Company is a general-use vehicle rental company in each of North America, Australia, New Zealand and certain other regions based on published airport statistics. Avis Budget Group is headquartered in Parsippany, N.J. and has roughly 24,000 employees. * * * As reported by the Troubled Company Reporter on April 30, 2009, Standard & Poor's Ratings Services assigned a '6' recovery rating to Avis Budget Car Rental LLC's (CCC+/Developing/--) unsecured notes, indicating expectations of negligible (0%-10%) recovery of principal in the event of a payment default. Avis Budget Car Rental LLC is a subsidiary of Avis Budget Group Inc. (CCC+/Developing/--). BABUSKI LLC: Trustee May be Appointed to Liquidate Assets --------------------------------------------------------- Steve Green at Las Vegas Sun reports that U.S. Bankruptcy Judge Linda Riegel said that she might appoint a trustee to liquidate Jean Marc El Jwaidi's Babuski LLC. According to Las Vegas Sun, Judge Riegel has set an October 22 evidentiary hearing on competing appraisals that may determine whether creditors other than Vestin Mortgage -- which is seeking to foreclose on land Babuski holds at Russell Road -- have any stake in the land. Las Vegas Sun states that Judge also set an October 14 hearing on her own motion that Babuski show cause why the Chapter 11 case should not be converted to a Chapter 7 liquidation in which the Company assets would be sold by a trustee. Las Vegas, Nevada-based Babuski LLC is one of real estate investment companies owned by Jean Marc El Jwaidi. It filed for Chapter 11 on June 29, 2009 (Bank. D. Nev. Case No. 09-21360). In its petition, the Debtor said it has assets and debts ranging from $10 million to $50 million. The Company filed for bankruptcy in order to block foreclosure proceedings by creditor Vestin Mortgage involving land Babuski said it is developing at Russell Road and the 215 Beltway. BARZEL INDUSTRIES: Auction of Assets to Proceed October 28 ---------------------------------------------------------- The Bankruptcy Court has approved Barzel Industries Inc.'s request to sell its assets at an auction where Chriscott USA Inc. is lead bidder, despite objections by some parties. Chriscott will buy the assets absent higher and better bids at the auction or absent any competing bids. The Court rejected objections to the terms of the auction and sale. The Official Committee of Unsecured Creditors had sought to delay the auction by a month. The Committee asserted, "the timeline of the sale, the proposed bid protections, and the terms of the debtors' postpetition financing together yield cases that are set up to fail." Both the Creditors Committee and the U.S. trustee administering the Chapter 11 bankruptcy case had sought to eliminate a breakup fee proposed for the stalking bidder. The Committee proposed the bid protections to be limited to an expense reimbursement of up to $750,000. Despite the objections, the Court approved the break-up fee equal to 3% of the cash portion of the purchase price and expense reimbursement of up to $750,000. Barzel Industries and substantially all of its U.S. and Canadian subsidiaries have an Asset Purchase Agreement with Chriscott USA Inc. and 4513614 Canada Inc. pursuant to which the Buyer will purchase substantially all of the assets of the Sellers for $65.0 million in cash, subject to certain adjustments, and assume certain liabilities from the Sellers associated with the purchased assets. The deal is subject to approval by both U.S. and Canadian Courts. According to the order signed by the Court, competing bids are due October 26. An auction will be held on October 28 if competing bids in addition to Chriscott's will be received by the bid deadline. The Debtors intend to apply all proceeds of the Asset Purchase to repay amounts owed under a DIP Credit Agreement with JPMorgan Chase, the Prepetition notes and, to the extent applicable, the Prepetition secured loan agreement. The Company's stockholders will not receive any proceeds from the Asset Purchase. The sale of Barzel to Chriscott would constitute a sale to an insider. Barzel acquired all of the stock of Barzel Industries canada Inc., formerly Novamerican Steel Canada Inc., and formerly Novamerican steel on November 2007. The controlling shareholder of Chriscott was the majority owner of Novamerican Steel Inc. The Committee also filed an objection to Barzel Industries' motion to obtain post-petition financing. The Committee asserts, "The DIP Lenders and the prepetition Lenders are attempting to improve their lien position, charge the estates significant interest and fees and leave the estates with nothing to distribute to other creditors." About Barzel Industries Norwood, Massachusetts-based Barzel Industries, Inc., processes and distributes steel. The Company manufactures steel for the construction and industrial manufacturing industries, and produces finished commercial racking products. Barzel recorded assets of $370,145,000 against debts of $375,412,000 as of May 30, 2009. Barzel Industries -- aka Novamerican Steel Inc. and Symmetry Holdings Inc. -- and seven affiliates filed for Chapter 11 on September 15, 2009 (Bankr. D. Del. Case No. 09-13204). On the same day, the Company filed applications for relief under the Canadian Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice -- Commercial List. Judge Christopher S. Sontchi presides over the Chapter 11 cases. J. Kate Stickles, Esq., at Cole, Schotz, Meisel, Forman & Leonard, in Wilmington, Delaware, and Karen M. McKinley, Esq., and Norman L. Pernick, Esq., at Cole Scholtz Meisel Forman Leonard, P.A., in Wilmington, Delaware, serve as legal counsel. Logan & Company serves as claims and notice agent. Houihan Lokey Howard & Zukin Capital, Inc., has been tapped to help the Debtors with the sale process. BARZEL INDUSTRIES: Wins Final Approval of $30MM DIP Financing ------------------------------------------------------------- The Bankruptcy Court has granted final approval to Barzel Industries Inc.'s request to obtain financing for its U.S. and Canadian units from lenders led by JP Morgan Chase N.A., as administrative agent. The DIP Lenders have agreed to provide financing in an amount no to exceed $30,000,000 at any one time outstanding. The loans will be divided between the Debtors and Barzel Canada. The JPMorgan led-lenders were the same lenders that provide the Debtors with $175,000,000 in revolving loans prepetition. Only $18,439,000 of those loans are outstanding as of the Petition Date. The prepetition obligations will be rolled up in to the DIP facility. About $2,250,000 of the DIP financing is budgeted for the winding- down of the Debtors' estate following the sale of substantially all its assets under 11 U.S.C. Sec. 363. Up to $500,000 of the wind-up amount can be spent for any key employee incentive plan or related severance to participants in the plan. The DIP financing requires the Debtors to complete the sale of their assets within two months form the Petition Date. The Committee filed an objection to Barzel Industries' motion to obtain post-petition financing. The Committee asserts, "The DIP Lenders and the prepetition Lenders are attempting to improve their lien position, charge the estates significant interest and fees and leave the estates with nothing to distribute to other creditors." About Barzel Industries Norwood, Massachusetts-based Barzel Industries, Inc., processes and distributes steel. The Company manufactures steel for the construction and industrial manufacturing industries, and produces finished commercial racking products. Barzel recorded assets of $370,145,000 against debts of $375,412,000 as of May 30, 2009. Barzel Industries -- aka Novamerican Steel Inc. and Symmetry Holdings Inc. -- and seven affiliates filed for Chapter 11 on September 15, 2009 (Bankr. D. Del. Case No. 09-13204). On the same day, the Company filed applications for relief under the Canadian Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice -- Commercial List. Judge Christopher S. Sontchi presides over the Chapter 11 cases. J. Kate Stickles, Esq., at Cole, Schotz, Meisel, Forman & Leonard, in Wilmington, Delaware, and Karen M. McKinley, Esq., and Norman L. Pernick, Esq., at Cole Scholtz Meisel Forman Leonard, P.A., in Wilmington, Delaware, serve as legal counsel. Logan & Company serves as claims and notice agent. Houihan Lokey Howard & Zukin Capital, Inc., has been tapped to help the Debtors with the sale process. BARZEL INDUSTRIES: U.S. Trustee Forms Three-Member Committee ------------------------------------------------------------ Roberta A. DeAngelis, United States Trustee for Region 3, appointed three creditors to serve on the Official Committee of Unsecured Creditors for Barzel Industries Inc. and its debtor- affiliates. The members of the Committee: a) Severstal Sparrows Point LLC Attn: Dawn A. Hlavaty 14661 Rotunda Dearborn, MI 48121 Tel: (313) 310-6374 Fax: (313) 337-9362 b) Northstar Bluescope Steel Attn: Joesph Budion 6767 County Road #9 Delta, OH 43560 Tel: (419) 822-2205 Fax: (419) 822-2276 c) Ansonia Copper & Brass, Inc. Attn: Stephen Turner 725 Bank Street Waterbury, CT 06708 Tel: (203) 755-6057 x 107 Fax: (203) 756-1330 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 Barzel Industries Norwood, Massachusetts-based Barzel Industries, Inc., processes and distributes steel. The Company manufactures steel for the construction and industrial manufacturing industries, and produces finished commercial racking products. Barzel recorded assets of $370,145,000 against debts of $375,412,000 as of May 30, 2009. Barzel Industries -- aka Novamerican Steel Inc. and Symmetry Holdings Inc. -- and seven affiliates filed for Chapter 11 on September 15, 2009 (Bankr. D. Del. Case No. 09-13204). On the same day, the Company filed applications for relief under the Canadian Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice -- Commercial List. Judge Christopher S. Sontchi presides over the Chapter 11 cases. J. Kate Stickles, Esq., at Cole, Schotz, Meisel, Forman & Leonard, in Wilmington, Delaware, and Karen M. McKinley, Esq., and Norman L. Pernick, Esq., at Cole Scholtz Meisel Forman Leonard, P.A., in Wilmington, Delaware, serve as legal counsel. Logan & Company serves as claims and notice agent. Houihan Lokey Howard & Zukin Capital, Inc., has been tapped to help the Debtors with the sale process. BASSADOUR BUTLER: Files for Chapter 7 Bankruptcy Protection ----------------------------------------------------------- David Bracken at News & Observer reports that Bassadour Butler & Eugene has filed for Chapter 7 bankruptcy protection. Bassadour Butler & Eugene is a Raleigh-based real estate development company. BB&E started in 1994. The Company provided design, construction, and consulting services to residential and commercial projects. BATTLE CREEK MUTUAL: A.M. Best Affirmed FSR of 'C++' ---------------------------------------------------- A.M. Best Co. has affirmed the financial strength rating (FSR) of C++ (Marginal) and issuer credit rating (ICR) of "b" of Battle Creek Mutual Insurance Company (Battle Creek) (Battle Creek, NE). The outlook for both ratings is negative. Concurrently, A.M. Best has withdrawn the ratings and assigned a category NR-4 to the FSR and an "nr" to the ICR. These rating actions reflect Battle Creek's decision to withdraw from A.M. Best's interactive rating process. The ratings reflect Battle Creek's unfavorable operating performance and deteriorating level of surplus, which negatively impacted its risk-adjusted capitalization. Offsetting these negative rating factors is Battle Creek's longstanding local market presence and management's strategies designed to improve operating performance. BEACH PHAM LLC: Chapter 11 Case Summary & Unsecured Creditor ------------------------------------------------------------ Debtor: Beach Pham LLC 1738 44th Avenue San Francisco, CA 94122 Bankruptcy Case No.: 09-20761 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Central District of California (Santa Ana) Judge: Theodor Albert Debtor's Counsel: Jeffrey B. Smith, Esq. 301 E Ocean Blvd, Suite 1700 Long Beach, CA 90802 Tel: (562) 624-1177 Fax: (562) 624-1178 Email: jsmith@cgsattys.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor identified SunAmerica Life Insurance Company with a bank loan debt claim for $2,850,000 (Collateral: $6,500,000; Unsecured: $0) as its largest unsecured creditor. A full-text copy of the Debtor's petition, including a list of its largest unsecured creditor, is available for free at: http://bankrupt.com/misc/cacb09-20761.pdf The petition was signed by Phuong Pham. BENJAMIN BRASHEN: Case Summary & 7 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Benjamin D. Brashen 930 1st St. S. Kirkland, WA 98033 Bankruptcy Case No.: 09-20406 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Thomas T. Glover Debtor's Counsel: Christina Latta Henry, Esq. Seattle Debt Law LLC 705 2nd Ave, Suite 501 Seattle, WA 98104 Tel: (206) 324-6677 Email: chenry@seattledebtlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of $1,342,807, and total debts of $1,558,120. A full-text copy of Mr. Brashen's petition, including a list of his 7 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/wawb09-20406.pdf The petition was signed by Mr. Brashen. BERNARD MADOFF: Sterling Didn't Lose Money, May be Clawback Target ------------------------------------------------------------------ Sterling Equities didn't lose money from the Bernard Madoff fraud and was able to withdraw $50 million over what it invested with the Madoff firm, Anthony M. Destefano at Newsday reports, citing people familiar with the matter. Newsday relates that the court-appointed trustee recovering assets for Bernard Madoff's fraud victims, could seek to claw back money from Sterling or others took out in excess of deposits, but Mr. Picard seems to be going after high rollers like Jeffry Picower, who is being sued for $7.2 billion. Irving H. Picard, the trustee liquidating Bernard L. Madoff Investment Securities LLC, has already sued a number of investors, including hedge funds and investment firms that "knew or should have known" that Mr. Madoff was engaged in fraud. Mr. Picard is pursuing avoidance actions or clawback suits against clients, which included charities, that profited from the fraud at BLMIS, even if they weren't aware of the $65 billion Ponzi scheme. Mr. Picard has identified 2,336 account holders at BLMIS that suffered net losses of more than $13 billion. Mr. Picard has received 15,870 claims in total from victims of the fraud. About Bernard Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On 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. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Case No. 08-01789) (Lifland, J.). Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.). BLOCKBUSTER INC: Lonestar Partners Discloses 6.0% Equity Stake -------------------------------------------------------------- Lonestar Partners, L.P., Lonestar Capital Management LLC, Peter Levinson, Jerome L. Simon, and Yedi Wong disclose holding 4,331,900 shares or roughly 6.0% of the common stock of Blockbuster Inc. Lonestar Capital Management is the investment adviser to and general partner of Lonestar, with respect to the Shares held by Lonestar. Mr. Simon and Mr. Levinson are managing members of LCM. Mr. Wong is the chief financial officer of LCM. About Blockbuster Blockbuster, Inc., headquartered in Dallas, Texas, is a leading global provider of in-home movie and game entertainment with roughly 7,400 stores throughout the Americas, Europe, Asia, and Australia. Revenues are about $5.3 billion. As reported by the Troubled Company Reporter, Sept. 18, 2009, Standard & Poor's Ratings Services raised its corporate credit rating on Blockbuster to 'B-' from 'CCC'. The outlook is stable. The TCR on Oct. 6, 2009, said Moody's Investors Service upgraded Blockbuster's long term ratings, including its probability of default rating to 'Caa1' from 'Caa3' and its corporate family rating to 'Caa1' from 'Caa2'. The rating outlook is stable. BOSQUE POWER: Moody's Downgrades Rating to 'B3' From 'B2' --------------------------------------------------------- Moody's Investors Service has downgraded the rating of Bosque Power Company, LLC, to B3 from B2. The outlook remains negative. The downgrade reflects the company's failure to achieve substantial completion on its combined cycle expansion project. Construction and start up delays now exceed six months. As a result of these delays, the project's cash flows and level of debt repayment this year are now expected to be even further below initial forecasts than was anticipated when the project's rating was downgraded to B2 and the outlook revised to negative last fall. The downgrade also incorporates the implications for the project's future cash flows of the requirement that it extend its existing energy hedge and enter into an additional hedge by the middle of January 2010 in the midst of a very weak market. The negative outlook considers the possibility that the project could face a default under its financial covenants when its third quarter financial results are published. Furthermore, it is possible that Bosque may be required to make a payment to its EPC contractor depending on the outcome of the upcoming arbitration procedure to resolve the dispute between the two parties, each of which has lodged claims against the other in regards to the construction delays and associated costs. The project consists of one 1x1 combined cycle generating unit and two simple cycle combustion turbines which are in the process of being converted to a 2x1 combined cycle unit. Construction is being undertaken by Lauren Engineers & Constructors pursuant to a fixed-price, date-certain EPC contract. The steam turbine and the heat recovery steam generators were separately procured in the grey-market and were included in the facility's acquisition price when it was purchased from a subsidiary of LS Power. If Lauren is at fault for the delay in completion, it must pay liquidated damages up to 5% of the contract price. However, the level of operating performance of the converted units is not guaranteed, exposing the project to a degree of operating risk. Substantial completion was originally scheduled for March 30, 2009 and was guaranteed by April 22, 2009, but the project has encountered repeated delays. Most recently, substantial completion was expected to be achieved on September 30, 2009. However, the project failed the last remaining portion of the acceptance test. It is not yet clear when the project will be ready to complete the final portion of the test, but even in a best case scenario it will be a minimum of one to two weeks. The project asserts the delays are the fault of the EPC contractor. As a result, it has been assessing delay liquidated damages and other backcharges against Lauren, some of which have been withheld as offsets from payments due to the contractor. Based upon these withholdings, the project remains within budget. However, the project and Lauren are disputing responsibility for the delays and various cost overruns, as well as the EPC Contractor's claims that it was required to perform work outside the scope of its contract. The two parties are expected to go to arbitration in December. Depending upon the outcome of the arbitration, the project may either be required to make a payment to or entitled to receive payment from Lauren. However, there may not be sufficient operating cash flows to make such a payment if one is required. Additional equity could potentially be provided, but it is uncertain if the sponsor would be willing or able to provide further support. Moody's notes the project has benefited from strong sponsor support in the past, evidenced by two equity cures totaling $15 million and the capitalization of the replacement hedge counterparty at a cost of $33 million last year, in addition to a sizeable initial equity contribution. At a total of less than $1 million, operating cash flows during the first and second quarter this year were insufficient to pay debt service even net of capitalized interest on the $203 million construction loan sub-amount. Instead, the project relied on an $11.5 million equity cure it made after the fourth quarter last year in order to avoid a financial covenant default together with proceeds from the May sale of its $49 million claim against Lehman Brothers for an undisclosed amount. The rest of the proceeds were used to repay a draw on the revolver and replenish the debt service reserve fund, the balance of which currently stands at $20.3 million, slightly below the target level of nine months of debt service, which is currently equal to approximately $21 million. Third quarter results have not been published, but capitalized interest was initially expected to be fully expended in May, which would cause a significant increase in the project's net interest expense. If there was not an offsetting increase in operating cash flows, the project may have been forced to rely on some of the proceeds of a $10 million draw it made on its revolver (as a result of which the revolver is now fully drawn) in July, which would leave it with very little liquidity going into the fourth quarter. In addition, the project faces the prospect of a potential default under its financial covenants when its third quarter financial results are published and no further equity cures are permitted until the fourth quarter according to the credit agreement. Third quarter cash flows are expected to have been well below previous expectations with the new unit unavailable to be dispatched during the peak summer season due to the construction delays. This risk is heightened by the current weakness in the ERCOT market coupled with extremely low gas prices and possible limits on the simple cycle units' availability due to ongoing construction. However, management asserts that it benefited from some price spikes and Moody's notes that thanks to the loose covenants the project does not need to have generated a significant level of cash flow to avoid a default. In the sponsor base case from the time of financing, the project was projected to have repaid $55 million by the end of 2009, leaving it with just $267 million funded debt outstanding. Including draws on the revolver, however, the project had $335 million outstanding as of June 30, approximately $10 million more than it had when the transaction closed. With limited cash flows likely to be generated during the fourth quarter even if the substantial completion is achieved in a timely manner, and the remaining revolver balance drawn in July, this figure is unlikely to decline significantly by the end of the year in Moody's view. Per the credit agreement, the project is required to extend the hedge on its existing 1x1 combined cycle unit for another year and put in place a new hedge for 50% of the capacity of the new 2x1 CCGT for a term of at least four years within 24 months of financial close, or mid-January 2010. Management has indicated that its efforts are currently focused on achieving substantial completion and it has not yet begun detailed negotiations with any potential counterparties. This will force it to negotiate an agreement on short notice in a down market, which limits its flexibility to obtain favorable terms. In light of the current market conditions, the terms of any new hedge agreements are likely to be considerably poorer than originally anticipated. Combined with the lower than anticipated debt paydown, this is expected to result in significantly weaker financial metrics than initially forecast. Given the negative outlook, the rating is unlikely to be upgraded in the near to medium term. However, the outlook could be revised to stable if the project successfully achieves substantial completion without significant further delay, avoids a default under its financial covenants, prevails in its dispute with its EPC contractor, and enters into new hedging agreements prior to the deadline in January on terms that will enable it to service its debt. The rating will face downward pressure if the project is unable to achieve substantial completion or defaults under its financial covenants, if the arbitrators rule against it in its dispute with its EPC Contractor, or if payments under its new hedge agreements are not sufficient to allow the project to support its debt. The last rating action on the company was on November 7, 2008, when it was downgraded to B2 and its outlook was revised to negative. Bosque Power Company, LLC, is a special purpose entity whose sole asset is the Bosque generating facility, which is located in Laguna Park, Texas, and dispatches into the ERCOT North zone. The existing generation facility consists of two simple cycle GE 7FA CT units totaling 325 MW (Units 1 & 2) and one GE 7FA unit with an output of 245 MW in 1x1 combined cycle configuration (Unit 3). The simple cycle units are currently being converted into a nominal 557 MW 2x1 combined cycle facility. Bosque is 97.85% owned by Arcapita, a private equity firm, and its affiliates and 2.15% by Fulcrum Power Services, an energy services and investment company that also serves as asset and energy manager for the project. BOWMAN INC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Bowman, Inc. dba Bowman Lumber Co. P.O. Box 54270 Lubbock, TX 79453 Bankruptcy Case No.: 09-50468 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of Texas (Lubbock) Judge: Robert L. Jones Debtor's Counsel: Robert W. St. Clair, Esq. Harding, Bass, Fargason, Booth et al P.O. Box 5950 Lubbock, TX 79408-5950 Tel: (806) 744-1100 Email: rstclair@hardlaw.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 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/txnb09-50468.pdf The petition was signed by Donald L. Smith Jr., president of the Company. BRENT THEODORE BARKER: Case Summary & 10 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Brent Theodore Barker 13035 E Turquoise Ave Scottsdale, AZ 85259 Bankruptcy Case No.: 09-25107 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtor's Counsel: Nasser U. Abujbarah, Esq. The Law Offices Of Nasser U. Abujbarah 10654 N. 32nd St Phoenix, AZ 85028 Tel: (602) 493-2586 Fax: (602) 923-3458 Email: NUALegal@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $1,012,750, and total debts of $2,470,483. A full-text copy of Mr. Barker's petition, including a list of his 10 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/azb09-25107.pdf The petition was signed by Mr. Barker. BRUCE ALLEN: Case Summary & 12 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Bruce Lee Allen dba Bruce Allen Construction PO Box 3609 Hailey, ID 83333-3609 Bankruptcy Case No.: 09-41567 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Idaho [LIVE] (Twin Falls) Judge: Jim D. Pappas Debtor's Counsel: Brent T. Robinson, Esq. POB 396 Rupert, ID 83350 Tel: (208) 436-4717 Email: btr@idlawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of Mr. Allen's petition, including a list of his 12 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/idb09-41567.pdf The petition was signed by Mr. Allen. BUILDING MATERIALS: Plan Outline Hearing Moved to Oct. 22 --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has moved to October 22 the hearing to consider the adequacy of the disclosure statement explaining the proposed Chapter 11 plan of Building Materials Holding Corp. The official committee of unsecured creditors sought the continuance of the hearing saying that it didn't have time to evaluate the latest changes to the Plan as the second amendments to the Plan and Disclosure Statement were filed three business days prior to the hearing scheduled for October 7. The creditors' panel sought a November 22 continuance. The Second Amended Plan provides for BMHC's secured lenders to convert debt into equity, becoming majority owners of the Company upon emergence. BMHC has secured a commitment for $83.5 million of exit financing that will be available to the Company upon its emergence from Chapter 11 to help meet its operating needs and grow its business. The agreement includes an option to expand the facility by up to $20 million, for a total of $103.5 million, subject to certain conditions. The facility will be provided by a group of lenders led by Wells Fargo. BMHC expects to emerge from Chapter 11 before the end of the year. BMHC notes that in a hypothetical Chapter 7 liquidation unsecured creditors won't receive any distributions. However, if they vote for the Second Amended Plan, they will receive their pro rata share from the $5 million allocated for the unsecured cash fund and the proceeds from the sale of insurance policies. They are expected to recover 13.1% of their claims under this scenario. Any unsecured creditor class that rejects the Plan won't receive distributions. BMHC's existing common shares held by shareholders will be extinguished and these shareholders will not receive any distributions. Under the Second Amended Plan, the Debtors are projected to emerge from Chapter 11 with approximately $131 million of net debt, which will be reduced to $62 million by December 12. Copies of the Second Amended Plan and Disclosure Statement are available free of charge at: http://bankrupt.com/misc/BMHC_Amended_DS.pdf http://bankrupt.com/misc/BMHC_AmendedPlan.pdf About Building Materials Building Materials Holding Corporation -- http://www.bmhc.com/-- is one of the largest providers of building materials and residential construction services in the United States. BMHC serves the homebuilding industry through two recognized brands: as BMC West, it distributes building materials and manufacture building components for professional builders and contractors in the western and southern states; as SelectBuild, it provides construction services to high-volume production homebuilders in key markets across the country. BMHC and 11 affiliates filed for bankruptcy on June 16, 2009 (Bankr. D. Del. Lead Case No. 09-12074). Judge Kevin J. Carey handles the case. Michael A. Rosenthal, Esq., and Matthew K. Kelsey, Esq., at Gibson, Dunn & Crutcher LLP; and Sean M. Beach, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as bankruptcy counsel. Paul Croci, at Peter J. Solomon Company, serves as financial advisor. Joseph Spano at Alvarez & Marsal North America, LLC, serves as restructuring advisor. The Debtors' tax consultant is KPMG LLP; tax advisor is PricewaterhouseCoopers LLP; and claims and notice agent is The Garden City Group, Inc. As of March 31, 2009, the Debtors had total assets of $480,148,000 and total debts of $481,314,000. CALIFORNIA COASTAL: KeyBank Agrees to Forbear Until Nov. 1 ---------------------------------------------------------- California Coastal Communities, Inc., said in a regulatory filing that on October 1, 2009, it entered into: (i) a Senior Secured Revolving Loan Forbearance Agreement with KeyBank National Association as a lender and as syndication agent under that certain Senior Secured Revolving Credit Agreement dated as of September 15, 2006 as amended from time to time; and (ii) a Senior Secured Term Loan Forbearance Agreement with KeyBank as a lender and as syndication agent under that certain Senior Secured Term Loan Agreement dated as of September 15, 2006 as amended from time to time. KeyBank has advised the Company that it has received the consent of various other lenders, who together with KeyBank hold over 66.66% of the principal amount outstanding under each of the Loan Agreements, to enter into the forbearance contained in the Forbearance Agreements. The Forbearance Agreements terminate on November 1, 2009 or upon such earlier date as any further defaults may occur. On September 28, 2009, the Company received a notice of an event of default from KeyBank with respect to the loan-to-value covenant of the Revolving Loan Agreement which, but for the Forbearance Agreements, would give rise to the right to accelerate the indebtedness under each of the Loan Agreements. As of September 30, 2009, approximately $81.7 million of principal was outstanding under the Revolving Loan Agreement and approximately $99.8 million of principal was outstanding under the Term Loan Agreement. On October 1, 2009, the Company received a notice of an event of default from KeyBank with respect to the Company's nonpayment of approximately $1.7 million of principal that was due on September 30, 2009, under the terms of the Revolving Loan Agreement which, but for the Forbearance Agreements, would give rise to the right to accelerate the indebtedness under each of the Loan Agreements. As a result of not having received a waiver from, or an amendment by, all of the lenders under the Revolving Loan Agreement with respect to the Company's nonpayment of $1.7 million of principal that was due on September 30, 2009, a triggering event has occurred which could give rise to the immediate acceleration of the payment of all outstanding principal and accrued interest under both of the Loan Agreements. The Forbearance Agreements provide that the Agent and Lenders will not seek to enforce any remedies with regard to this payment default during the forbearance period ending November 1, 2009. The Company believes that any efforts to enforce such payment obligations, or otherwise accelerate the indebtedness under either of the Loan Agreements, would be automatically stayed under Chapter 11 of the United States Bankruptcy Code in the event that the Company elected to file for protection under such laws. The Company intends to use the forbearance period to negotiate a restructuring of its obligations under the Loan Agreements. Copies of the Forbearance Agreements are available for free at: http://researcharchives.com/t/s?4671 http://researcharchives.com/t/s?4672 Home Sales Update During the quarter ended September 30, 2009 the Company's Brightwater project in Huntington Beach, California generated 15 net new sales orders compared with six net new orders in the comparable quarter of 2008, 11 net new orders in the second quarter of 2009 and five net new orders in the first quarter of 2009. Ten of the 15 net new orders during the quarter were generated over the last five weeks. The Company delivered seven and 21 homes at Brightwater in the third quarter of 2009 and the first nine months of 2009, respectively, compared with the delivery of seven and 16 homes during the comparable periods of 2008. The Company has 17 Brightwater homes in backlog with an aggregate sales value of $21.4 million as of September 30, 2009. About California Coastal California Coastal Communities, Inc. is a residential land development and homebuilding company with properties owned or controlled primarily in Orange County, California, and also in two other Southern California counties (Los Angeles and Riverside). The Company's principal activities include obtaining zoning and other entitlements for land that it owns; improving the land for residential development, and designing, constructing and selling single-family homes in Southern California. The Company's primary asset is a 356-home luxury coastal community known as Brightwater. The Company's homebuilding operations include projects in the Huntington Beach, the Inland Empire (Beaumont), and Lancaster areas of Southern California. During the year ended December 31, 2008, the Company delivered 55 homes. Its homebuilding subsidiary, Hearthside Homes, Inc., has delivered over 2,100 homes to families throughout Southern California. CALYPTE BIOMEDICAL: Posts $829,000 Net Loss in 2009 Second Quarter ------------------------------------------------------------------ Calypte Biomedical Corporation reported a net loss of $829,000 on sales of $202,000 for the the second quarter ended June 30, 2009, compared with a net loss of $3,460,000 on sales of $95,000 in the same period of 2008. Sales of AwareTMBED Incidence Test accounted for 92% of sales in the second quarter of 2009, compared with 73% in the second quarter of 2008. Revenue from the sales of the AwareTMBED Incidence Test increased by 170% in 2009 compared with 2008. Sales of AwareTM HIV-1/2 rapid tests accounted for 7% and 27% of sales in the second quarter of 2009 and 2008, respectively. Second quarter 2009 revenues from the sale of rapid tests decreased by 46% compared with rapid test revenues in the second quarter of 2008. Selling, general and administrative costs decreased by $1,926,000, or 77%, from $2,501,000 in the second quarter of 2008 to $575,000 in the second quarter of 2009. Loss from operations for the second quarter of 2009, at $484,000, reflects a reduction of 83% compared with the loss of $2,853,000 reported for the second quarter of 2008. The Company recorded interest expense of $456,000 for the second quarter of 2009 compared with $607,000 of net interest expense in the second quarter of 2008. At June 30, 2009, the Company's consolidated balance sheet showed $6,003,000 in total assets and $19,754,000 in total liabilities, resulting in a $13,751,000 stockholders' deficit. The Company's consolidated balance sheet at June 30, 2009, also showed strained liquidity with $711,000 in total current assets available to pay $16,369,000 in total current liabilities. Full-text copies of the Company's consolidated financial statements for the quarter ended June 30, 2009, are available for free at http://researcharchives.com/t/s?4695 Going Concern Doubt As reported in the TCR on August 26, 2009, Odenberg, Ullakko, Muranishi & Co. LLP, in San Francisco, California, expressed substantial doubt about Calypte Biomedical Corporation's ability to continue as a going concern after auditing the Company's financial statements fro the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted that the Company suffered recurring operating losses and negative cash flows from operations, and management believes that the Company's cash resources will not be sufficient to sustain its operations through 2009 without additional financing. Based in Portland, Oregon, Calypte Biomedical Corporation (OTCBB: CMBC) develops, manufactures, and distributes in vitro diagnostic tests, primarily for the diagnosis of Human Immunodeficiency Virus ("HIV") infection. Through its 51%-owned joint ventures, the Company has manufacturing and marketing operations in Beijing, China. CANWEST GLOBAL: Releases Financial Projections ---------------------------------------------- In June 2009, Canwest Global Communications Corp. and Canwest Media Inc. entered into confidentiality, non-disclosure and non- use agreements with certain members of an ad hoc committee of holders of 8% senior subordinated notes of CMI in order to facilitate the discussion of a possible recapitalization transaction. The Confidentiality Agreements require Canwest to now disclose publicly certain of the Non-Public Information. According to Canwest's projections, it expects total receipts of C$124.7 million for three months ended Nov. 30, 2009, and C$127 million for three months ended Feb. 28, 2010. It sees a positive net cash flow of C$144.6 million for the November quarter while a negative cash flow of C$11.88 million in the February quarter. The projections contemplate Canwest's emergence from CCAA on Feb. 28, 2010. It expects unrestricted cash at C$11.4 million and proceeds from equity of C$65 million at that time. Canwest projects revenues of C$557.7 million for fiscal year ending August 31, 2010, and C$565.5 million in the following fiscal year. About Canwest Global Canwest Global Communications Corp. (TSX: CGS and CGS.A,) -- http://www.canwest.com/-- is Canada's largest media company. In addition to owning the Global Television Network and 23 industry- leading specialty channels, Canwest is Canada's largest publisher of English language paid daily newspapers and owns and operates more than 80 online properties. Canwest Global Communications Corp., and affiliates, including Canwest Media Inc., voluntarily entered into, and successfully obtained an Order from the Ontario Superior Court of Justice (Commercial Division) commencing proceedings under the Companies' Creditors Arrangement Act. The CMI Entities' commencement of these proceedings was undertaken in furtherance of a proposed recapitalization transaction that is supported by over 70% of holders of the 8% senior subordinated notes issued by CMI. FTI Consulting Canada Inc., is serving as the Court-appointed Monitor in the CCAA proceedings to oversee the operations of the CMI Entities and report to the Court during the recapitalization. At May 31, 2009, Canwest Media had C$4,847,020,000 in total assets and C$5,826,522,000 in total liabilities. Bankruptcy Creditors' Service, Inc., publishes Canwest Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 15 proceedings and the proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Canwest Global Communications Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). CANWEST GLOBAL: Says It Won't Liquidate Assets ---------------------------------------------- Harold (Hap) Stephen, chief restructuring advisor to Canwest Global Communications Corp., issued a statement in response to media commentary suggesting that the financial restructuring of certain businesses of Canwest involves a liquidation of assets. According to Mr. Stephen, "The goal of the financial restructuring is to create a recapitalized Canwest that will be a stronger industry competitor with a renewed financial outlook by means of a recapitalization transaction involving a conversion of debt to equity. This recapitalization is supported by the members of the ad hoc committee of 8% senior subordinated notes of Canwest Media Inc. holding more than 70% of the outstanding amount of 8% notes. This pre-packaged financial restructuring is intended to minimize business disruption and preserve the value of these business operations which will continue uninterrupted during the recapitalization process." Canwest also confirmed that the businesses included in the october 6 filing for creditor protection are made up of Canwest Global Communications Corp., Canwest Media Inc., Canwest Television Limited Partnership including Global Television, MovieTime, DejaView and Fox Sports World as well as The National Post Company. Collectively, these businesses account for approximately 30% of the Company's revenues. Excluded from the filing are the CW Media stable of specialty channels, TVtropolis, Mystery TV and Men TV. Canwest Limited Partnership - the Canadian publishing and associated online and mobile operations - is also excluded as it continues to work with its senior lenders on its own financial restructuring. The recapitalization of the CMI group of companies may include the transfer of the National Post to Canwest Limited Partnership if an agreement with its senior lenders can be reached. About Canwest Global Canwest Global Communications Corp. (TSX: CGS and CGS.A,) -- http://www.canwest.com/-- is Canada's largest media company. In addition to owning the Global Television Network and 23 industry- leading specialty channels, Canwest is Canada's largest publisher of English language paid daily newspapers and owns and operates more than 80 online properties. Canwest Global Communications Corp., and affiliates, including Canwest Media Inc., voluntarily entered into, and successfully obtained an Order from the Ontario Superior Court of Justice (Commercial Division) commencing proceedings under the Companies' Creditors Arrangement Act. The CMI Entities' commencement of these proceedings was undertaken in furtherance of a proposed recapitalization transaction that is supported by over 70% of holders of the 8% senior subordinated notes issued by CMI. FTI Consulting Canada Inc., is serving as the Court-appointed Monitor in the CCAA proceedings to oversee the operations of the CMI Entities and report to the Court during the recapitalization. At May 31, 2009, Canwest Media had C$4,847,020,000 in total assets and C$5,826,522,000 in total liabilities. Bankruptcy Creditors' Service, Inc., publishes Canwest Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 15 proceedings and the proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Canwest Global Communications Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). CANWEST GLOBAL: Wants Canada as Site of Main Bankr. Proceedings --------------------------------------------------------------- Canwest Global Communications Corp. said FTI Consulting Canada Inc., the Canadian Court-appointed Monitor in the proceedings commenced yesterday by the Company and certain of its subsidiaries under Canada's Companies' Creditors Arrangement Act), sought protection yesterday in the United States Bankruptcy Court for the Southern District of New York under Chapter 15 of the United States Bankruptcy Code for certain of the entities involved in Canwest's television business that filed for protection under the CCAA, including Canwest, Canwest Media Inc. and Canwest Global Broadcasting Inc./Radiodiffusion Canwest Global Inc. The Monitor also obtained an immediate temporary restraining order from the United States Bankruptcy Court to protect Canwest and Canwest Television Limited Partnership, one of Canwest's principal broadcasting subsidiaries. Canwest's day-to-day operations and television programming are expected to continue without interruption during its restructuring. Hearings before the United States Bankruptcy Court to continue the temporary restraining order and to recognize the Chapter 15 Application are scheduled for October 15, 2009, and November 3, 2009, respectively. On Tuesday, Canwest, along with certain of its subsidiaries, filed for creditor protection under the CCAA with the intention of reorganizing. At the initial hearing before the Ontario Superior Court of Justice (Commercial List) at Toronto, which is overseeing Canwest's CCAA proceedings, FTI was appointed as Monitor and foreign representative for Canwest. FTI was also authorized by the Canadian Court to file the Chapter 15 cases to protect Canwest's interests and assets in the United States. Through the Chapter 15 cases, the Monitor is requesting that the United States Bankruptcy Court recognize the Canadian CCAA cases in the United States with respect to certain of the Canwest entities and provide limited aid to the CCAA proceedings, including a stay of proceedings and actions in the United States against the entities included in the Chapter 15 proceedings. The Monitor is also asking for a preliminary injunction to prevent television studios and other television content providers from interfering with Canwest's broadcasting rights to its many popular American hit shows. "We've taken action now to ensure the long-term viability of Canwest's operations," said Leonard Asper, President and CEO of Canwest. "Our goal is to complete the restructuring process in Canada as quickly as possible." He added, "The commencement of the Chapter 15 cases will protect Canwest's CCAA proceedings so that Canwest can emerge from CCAA a financially stable company that is ready to take advantage of the Canadian economy as it begins to improve." Conrad Black Blames Financing According to Bloomberg News, Conrad Black, who sold his newspapers to CanWest Global Communications for C$3.2 billion in 2000, said he isn't responsible for the bankruptcy filing of the media company. "I had nothing to do with the CanWest problems," Mr. Black wrote October 7 in an e-mail from a federal prison outside Orlando, Florida, where he is serving a 6 1/2-year sentence for fraud. "The acquisition from us was not financed properly." About Canwest Global Canwest Global Communications Corp. (TSX: CGS and CGS.A,) -- http://www.canwest.com/-- is Canada's largest media company. In addition to owning the Global Television Network and 23 industry- leading specialty channels, Canwest is Canada's largest publisher of English language paid daily newspapers and owns and operates more than 80 online properties. Canwest Global Communications Corp., and affiliates, including Canwest Media Inc., voluntarily entered into, and successfully obtained an Order from the Ontario Superior Court of Justice (Commercial Division) commencing proceedings under the Companies' Creditors Arrangement Act. The CMI Entities' commencement of these proceedings was undertaken in furtherance of a proposed recapitalization transaction that is supported by over 70% of holders of the 8% senior subordinated notes issued by CMI. FTI Consulting Canada Inc., is serving as the Court-appointed Monitor in the CCAA proceedings to oversee the operations of the CMI Entities and report to the Court during the recapitalization. At May 31, 2009, Canwest Media had C$4,847,020,000 in total assets and C$5,826,522,000 in total liabilities. Bankruptcy Creditors' Service, Inc., publishes Canwest Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 15 proceedings and the proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Canwest Global Communications Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). CANYON RIVER CENTER: Case Summary & 2 Largest Unsec. Creditors -------------------------------------------------------------- Debtor: Canyon River Center, LC 727 North 1550 East, Suite 400 Orem, UT 84097 Bankruptcy Case No.: 09-30944 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: R. Kimball Mosier Debtor's Counsel: Charles W. Hanna, Esq. 727 North 1550 East, Suite 490 Orem, UT 84097 Tel: (801) 868-3838 Fax: (801) 868-3842 Email: c.hannalaw@gmail.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 2 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/utb09-30944.pdf The petition was signed by L. Wayne Ross, manager of the Company. CAPMARK FINANCIAL: Contributes $600MM of Capital to Bank Unit ------------------------------------------------------------- Capmark Bank, the wholly-owned Utah industrial bank subsidiary of Capmark Financial Group Inc., agreed with each of the Federal Deposit Insurance Corporation and the Utah Department of Financial Institutions to the entry of Orders to Cease and Desist, dated and effective October 2, 2009. The Orders require Capmark Bank to maintain a Tier 1 leverage ratio of at least 8% and a Total Risk-Based Capital ratio of at least 10%. Within 45 days of the issuance of the Orders, Capmark Bank must submit a capital plan to the FDIC and UDFI. In addition, without the prior written consent of the FDIC and UDFI, Capmark Bank may not make any extensions of credit to the Company or any of its affiliates, declare or pay dividends or increase the amount of its brokered CDs in excess of the amount held on the date of the Orders. Under applicable regulations, the inclusion of a capital requirement in the FDIC Order will require Capmark Bank to obtain the approval of the FDIC for the issuance of brokered CDs. In order to support the capital position of Capmark Bank, the Company made a capital contribution in the amount of $600.0 million to Capmark Bank on September 30, 2009. The capital contribution consisted of $494.2 million in cash and $105.8 million in servicing advances. Capmark Bank and the Company are working with the FDIC and the UDFI to satisfy all of the requirements of the Orders. The Company does not expect the Orders to have a material impact on its existing lending commitments and deposits or its ability to conduct trust services and intends to continue to serve its customers. Capmark Bank's deposits remain insured by the FDIC to the maximum limits allowed by law. The Orders did not impose any monetary penalties. Restructuring Capmark Financial on September 2 reported a net loss of $1.6 billion for the quarter ended June 30, 2009 compared with a net income of $11.5 million for the quarter ended June 30, 2008. Capmark said September it has been in discussions with its lenders and the representatives of a number of senior noteholders regarding a restructuring of its primary debt obligations. As part of a longer-term restructuring, Capmark has been exploring strategic alternatives for all of its businesses. Capmark said restructuring efforts may include a reorganization under Chapter 11 of the U.S. Bankruptcy Code, the sale of certain additional businesses and/or a material contribution of cash and/or assets into Capmark Bank, Capmark's wholly-owned industrial bank subsidiary chartered by the State of Utah. Capmark has entered into an asset-put agreement with Warren Buffett's Berkshire Hathaway Inc. that gives it the right to sell its North American servicing and mortgage-banking businesses. About Capmark Financial Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- is a diversified company that provides a broad range of financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. * * * In September 2009, Fitch Ratings downgraded the long-term Issuer Default Ratings of Capmark Financial Group to 'C' from 'B-' and Capmark Bank to 'CC' from 'B-'. An IDR of 'C' indicates that default of some kind appears imminent or inevitable. Standard & Poor's Ratings Services also lowered its ratings on Capmark, including lowering the local-currency, long-term corporate credit rating on the company to 'CC' from 'B-'. Capmark Financial carries a 'Caa1' rating from Moody's. Capmark has total assets of $20 billion against total debts of $21 billion as of June 30, 2009. CARIBE MEDIA: S&P Junks Corporate Credit Rating From 'B' -------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and issue-level ratings on Caribe Media Inc. to 'CCC+' from 'B' and removed them from CreditWatch, where they were placed with negative implications Sept. 9, 2009. The rating outlook is negative. The recovery rating on the company's senior secured credit facilities remains at '3', indicating S&P's expectation of meaningful (50% to 70%) recovery for lenders in the event of a payment default. The ratings on Caribe are based on the consolidated credit quality of the Local Insight Media family of companies. Caribe is indirectly owned by Local Insight Media Holdings L.P., which, in turn, is owned by certain funds of Welsh, Carson, Anderson & Stowe, Spectrum Equity Investors, and certain members of management. LIMH, along with other WCAS funds, owns Local Insight Media Holdings Inc. Holdings indirectly owns Local Insight Regatta Holdings Inc. and the whole business securitization, consisting of ACS Media (the incumbent yellow page publisher in Alaska), CBD Media (the incumbent yellow page publisher in Cincinnati), and HYP Media (the incumbent yellow page publisher in Hawaii). Given the strategic relationships between, and common management and ownership of, the various operating entities, S&P view the rating of each individual entity based on a global view of the creditworthiness of all other entities. S&P expects decisions in support of the owners' operating and financial strategies to be made with a view toward the collective group of companies. Caribe owns 60% of the incumbent directory publisher in Puerto Rico (Axesa), 100% of the incumbent directory publisher in the Dominican Republic, and the right to receive a directory publishing rights payment from Puerto Rico Telephone Co. This payment is based on the core print directory advertising revenues generated at Axesa. "The ratings downgrade of Caribe reflects S&P's belief that credit measures of the consolidated group of Local Insight Media companies will continue to weaken over the intermediate term, as S&P does not expect that EBITDA generation will be sufficient to reduce leverage," said Standard & Poor's credit analyst Ariel Silverberg. "This stems from a combination of cyclical and what S&P believes are secular trends affecting the yellow page directory business." On the cyclical side, S&P expects that pressure on small businesses, including increased bankruptcies, will continue to reduce advertising budgets for the next several quarters. On the secular side, S&P believes that consumer preferences will continue to shift toward online local search tools and away from print- based directories. S&P believes the digital search market is more highly competitive and, therefore, S&P does not expect any increase in revenue from the sale of digital products to be sufficient to offset print revenue declines over the next several quarters. As a result of these factors -- and notwithstanding reductions to LIM's cost structure that management has already achieved -- S&P believes that, over the rating horizon, credit measures will deteriorate at a more rapid pace than S&P had previously expected. CASCADE GRAIN: Ethanol Plant Will be Sold Off to Pay for Debts -------------------------------------------------------------- Cascade Grain Products LLC's ethanol plant near Clatskanie will be sold off to pay the Company's debts, Erik Olson at The Daily News Online reports, citing JH Kelly, a Longview contractor that built the plant and is one of the Company's largest creditors. JH Kelly President Mason Evans said in a statement that interested buyers have approached JH Kelly about buying the plant at auction, and it could restart in 2010. According to TDN, Cascade Grain took out a $20 million loan from the Oregon Department of Energy to help construct the $200 million plant. Citing Cascade Grain's lawyer, TDN relates that the Company owes the state and other lenders $124 million. According to the report, JH Kelly claims that it's owed as much as $33 million for construction of the plant, though Cascade Grain disputes part of that claim. Cascade Grain, court documents say, owes at least $3.6 million to 20 other creditors. Cascade Grain Products LLC -- http://www.cascadegrain.com/-- is a member of a family of companies ultimately controlled by Berggruen Holdings Ltd. Cascade Grain Products has a 113.4-million gallon ethanol plant in Oregon. Cascade Grain Products filed for Chapter 11 on January 28, 2009 (Bankr. D. Ore. Case No. 09-30508). Douglas R. Pahl, Esq., at Perkins Coie LLP, represents the Debtor. The petition says that assets and debts range $100 million to $500 million. The U.S. Bankruptcy Court for the District of Oregon converted Cascade Grain's Chapter 11 reorganization case to Chapter 7 liquidation. CHEROKEES OF ALABAMA: Chief Denies Bankruptcy Rumors ---------------------------------------------------- Andy Powell at the Gadsden Times reports that Bobby Sterling, chief of The Cherokees of Alabama, has denied rumors that the tribe is going bankrupt. Citing Mr. Sterling, Gadsden Times relates that the Cherokees hasn't made a payment on the River Trace Golf Course that was due October 1 to the First Jackson Bank of Stevenson, but that group has assured that it will be paid. According to the report, Mr. Sterling said that an interest payment of $178,000 is due and the group owes $2.35 million on the note it assumed when it bought the 103-acre property in May 2009 for $13.1 million from the shareholders of River Trace Golf Course. "We're going to try to pay the whole thing, and transfer the note to somewhere else," the report quoted Mr. Sterling as saying. According to Gadsden Times, Mr. Sterling said that the Cherokees could borrow against the value of the property, which is $14 million, and there have been talks with other investors. The Cherokees will start paying River Trace shareholders by the first of the year, the report states, citing Mr. Sterling. The Cherokees of Alabama bought the River Trace Golf Course in May 2009. CHIPOLA RIVER LLC: Case Summary & 8 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Chipola River, LLC 10086 Griffin Road Fort Lauderdale, FL 33328 Bankruptcy Case No.: 09-50689 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Northern District of Florida (Panama City) Debtor's Counsel: Thomas B. Woodward, Esq. P.O. Box 10058 Tallahassee, FL 32302 Tel: (850) 222-4818 Fax: (850) 561-3456 Email: woodylaw@embarqmail.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of $2,100,000, and total debts of $1,298,761. 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/flnb09-50689.pdf The petition was signed by Doug Mitchell, CEO of the Company. CHRYSLER LLC: Amends Complaint against Daimler AG ------------------------------------------------- Chrysler Group LLC and Old Carco LLC file with the Court an amended complaint against Daimler AG. Gregory P. Joseph, Esq., at Gregory P. Joseph Law Offices LLC, in New York, contends that a controversy exists between the parties with respect to: -- their rights and obligations under the Court's previous orders, including the bidding procedures order and sale order in connection with the sale of the Debtors' assets to Fiat S.p.A.; -- Section 365 of the Bankruptcy Code; -- the assumed and assigned prepetition agreement dated April 17, 2009, that settled a number of disputes between Daimler and Old Chrysler; and -- Old Chrysler and Daimler's contracts for the development and supply of OM 651 diesel engines. Mr. Joseph argues that Daimler continues to seek EUR55 million from Chrysler in volume shortfall payments relating to the OM 651 diesel engines, despite the fact that those shortfall payments (i) were expressly waived and eliminated in the April Settlement Agreement, and (ii) are impermissible cure costs that are barred by the Bidding Procedures Order, Sale Order and Section 365. Daimler has improperly threatened to suspend negotiations for, and the continued supply of, key parts and has refused to assure the performance of its contractual obligations unless Chrysler accedes to Daimler's impermissible demand that Chrysler pay volume shortfall payments for OM 651 engines, thereby threatening Chrysler's production, Mr. Joseph alleges. As a result, Old Chrysler and Chrysler seek a judicial declaration from the Court that: (a) Daimler has no entitlement to volume shortfall payments under the OM 651 Contracts, having waived any right to those payments in Section 6 of the April Settlement Agreement; (b) the Section 365 cure amount with respect to the OM 651 Contracts is $0; and (c) pursuant to the Sale Order and other Orders applying to the assumption and assignment of the contracts entered by the Court, Daimler is barred from, directly or indirectly, attempting to recoup these waived volume shortfall payments or cure costs in, or in connection with, any current or future parts supply agreement. Chrysler intends to seek an order permitting an expedited trial, subject to the Court's availability, because Daimler's actions threaten harm to Chrysler and the Court's carefully structured bankruptcy plan, Mr. Joseph also says. About Chrysler LLC Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Mopar(R) and Global Electric Motors (GEM) brand vehicles and products. With the resources, technology and worldwide distribution network required to compete on a global scale, the alliance builds on Chrysler's culture of innovation -- first established by Walter P. Chrysler in 1925 -- and Fiat's complementary technology -- from a company whose heritage dates back to 1899. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Dodge Ram. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: Anchor Group Drops Claims vs. New Chrysler -------------------------------------------------------- In a Bankruptcy Court-approved stipulation, Anchor Tool & Die Co., doing business as Anchor Manufacturing Group, Inc., Chrysler Group LLC and Old Carco LLC, formerly known as Chrysler LLC, have agreed to settle and voluntarily dismiss with prejudice all claims asserted by Anchor against New Chrysler, and all claims and counterclaims asserted by New Chrysler and Old Chrysler against Anchor upon the execution of the "Settlement Transaction Documents," which are composed of a certain Asset Purchase Agreement, a certain Secured Loan Agreement, a certain Operating and Maintenance Agreement, a certain Landlord Consent and Acknowledgment, and all exhibits, schedules and addendums. The parties have executed the Settlement Transaction Documents, and hence, they agreed that all claims asserted by Anchor against New Chrysler will be dismissed without costs and with prejudice, pursuant to Rule 41(a)(1)(A)(ii) of the Federal Rules of Civil Procedure, as made applicable by Rule 7041 of the Federal Rules of Bankruptcy Procedure. All claims, including counterclaims, asserted by New Chrysler and Old Chrysler will be dismissed without costs and with prejudice, pursuant to Rules 41(a)(1)(A)(ii) and 41(c). The stipulation signed by the parties relate to a lawsuit was filed by Anchor Tool in the U.S. District Court for the Northern District of Ohio. The suit sought an order in favor of its decision to terminate its agreements, in the form of purchase orders, with Chrysler Group LLC. The lawsuit, however, was transferred to the New York Bankruptcy Court on July 28, 2009, upon request by Chrysler Group on grounds that it is related to the bankruptcy case of its predecessor, Chrysler LLC. After the case was transferred to the NY Bankruptcy Court, Judge Gonzalez issued a ruling directing Anchor Tool to continue supplying parts to Chrysler Group LLC under the purchased orders until September 30, 2009. About Chrysler LLC Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Mopar(R) and Global Electric Motors (GEM) brand vehicles and products. With the resources, technology and worldwide distribution network required to compete on a global scale, the alliance builds on Chrysler's culture of innovation -- first established by Walter P. Chrysler in 1925 -- and Fiat's complementary technology -- from a company whose heritage dates back to 1899. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Dodge Ram. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: U.S. DOL OKs Transfer of Note Stock to VEBA --------------------------------------------------------- The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) announced a proposed exemption that, if granted, would allow the New Chrysler Corp. to transfer approximately $4.59 billion promissory note and company securities to a Voluntary Employees Benefit Association (VEBA) Plan established to provide health benefits for the company's retirees. The retiree health plan would cover about 120,000 retirees and dependents when it becomes effective on Jan. 1, 2010. New Chrysler requested an exemption under the Employee Retirement Income Security Act (ERISA) to allow the VEBA plan to hold stock and debt of New Chrysler in order to facilitate the sale of the company to Fiat North America LLC. ERISA prohibits certain plans from holding large percentages of plan assets in the form of employer securities. The law gives the department authority, however, to grant exemptions that protect the interests of plan participants and beneficiaries. On May 31, 2009, the bankruptcy court issued an opinion allowing old Chrysler to sell substantially all of its assets to New Chrysler. New Chrysler is headquartered in Auburn Hills, Mich., and employs 55,000 employees. New Chrysler is owned by the Canadian Government, the U.S. Treasury, Fiat and the VEBA plan. The exemption would allow the securities transfer, permit New Chrysler and its health plans to reimburse each other for benefit payments mistakenly paid by the wrong entity during the transition to the new plan, and permit the automaker to recover mistaken deposits to the plan. The assets of the VEBA plan will be held by the same trust that holds the assets of the plans established by Ford and General Motors for their respective retirees. There will be separate accounting for each plan maintained by the three companies that are now funded through a single trust. The primary condition of the proposal is the appointment of an independent fiduciary to represent the plan with regard to New Chrysler securities transactions. The independent fiduciary will determine in advance of taking any action regarding the securities that the action is in the interests of the plan and its participants and beneficiaries. The proposed exemption also requires the review of benefit payments by an independent third party administrator and auditor for each of the plans and an objective dispute resolution process. In addition, the proposal sets time limits for the return of mistaken deposits and an objective dispute resolution process. About Chrysler LLC Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Mopar(R) and Global Electric Motors (GEM) brand vehicles and products. With the resources, technology and worldwide distribution network required to compete on a global scale, the alliance builds on Chrysler's culture of innovation -- first established by Walter P. Chrysler in 1925 -- and Fiat's complementary technology -- from a company whose heritage dates back to 1899. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Dodge Ram. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: Won't Oppose Dealer Direct Appeals Certification -------------------------------------------------------------- Several dealers whose contracts were not assigned to Fiat S.p.A.- owned Chrysler Group LLC ask Bankruptcy Judge Arthur Gonzalez to immediately certify their appeal from Judge Gonzalez's ruling enforcing automatic stay on certain of the Debtors' dealers to the United States Court of Appeals for the Second Circuit. The Affected Dealers are: -- Boucher Imports, Inc.; -- Braeger Chrysler Jeep; -- Quaden Motors, Inc., also known as Quaden Dodge, Inc.; -- Johnson Motors of St. Croix Falls, Inc.; -- Mueller Chrysler, Inc.; -- Wolf's Motor Car Company, Inc.; and -- Lakeland Pontiac-GMC-Jeep, Inc., also known as Lakeland Oldsmobile-Pontiac-GMC; Another appellant, Crain CDJ LLC, previously asked the Court for the same certification. Paul R. Norman, Esq., at Boardman, Suhr, Curry & Field LLP, in Madison, Wisconsin, relates that the Appeal presents (i) the question of the extent of a bankruptcy court's power to enjoin actions between non-debtor parties when those actions have no tangible effect on a debtor's bankruptcy estate, (ii) due-process issues relating to the extent of notice required when a bankruptcy court clarifies an ambiguous order to enjoin an action between two non-debtor parties, and (iii) the issue whether a bankruptcy court can clarify a prior ambiguous order in a manner that is beyond the scope of the Bankruptcy Code. The Appeal will materially advance the progress of the bankruptcy cases, Mr. Norman asserts. He points out that resolution of the Appeal will determine whether the Affected Dealers can enforce New Chrysler's obligations under Wisconsin law. Although the Affected Dealers dismissed their legal action commenced against New Chrysler in the Dane County Circuit Court, state of Wisconsin, and their administrative complaint against New Chrysler filed with the Division of Hearings and Appeals, state of Wisconsin, to enforce New Chrysler's obligation to continue their franchises under Section 218.0116(1)(i)2 of the Wisconsin Statutes, Mr. Norman reveals that the Affected Dealers intend to refile the Wisconsin Actions if the resolution of the Appeal does not prohibit them from doing so. The prompt resolution of the Appeal would prevent further irreparable harm to the Affected Dealers by expediting their ability to pursue preliminary injunctions by refiling the Wisconsin Actions, Mr. Norman further contends. Given the substantial likelihood that the Appeal will ultimately be brought to the Second Circuit Court of Appeals, immediate certification would promote judicial efficiency, he adds. Mr. Norman notes that since the Crain CDJ Appeal and this Appeal involve similar facts and issues, if either appeal is certified, both should be certified so that they may be consolidated to further promote judicial efficiency. Chrysler Responds Old Carco LLC, formerly known as Chrysler LLC, and New Chrysler jointly argue that the Appellants' stated grounds for seeking certification are inaccurate or overstated. The Court's Enforcement Order is a straightforward application of settled law and the Court's prior orders, Corinne Ball, Esq., at Jones Day, in New York, contends. "There are no unsettled questions or exigent circumstances that require certification of the Appellants' appeals of the Enforcement Order," Ms. Ball tells Judge Gonzalez. "Although certification may promote judicial economy by eliminating one step in the appellate process, the weight of that factor also depends on the Appellants' intentions with regard to any subsequent appeals," she points out. The weight of that factor is for the Bankruptcy Court to determine, Ms. Ball says. Accordingly, the Debtors and New Chrysler defer to the Bankruptcy Court as to whether certification is appropriate, and they inform Judge Gonzalez that they neither request nor oppose certification. In the event that the Court elects to certify the Appeals, the Debtors and New Chrysler object to the Appellants' proposed orders since the orders contain proposed findings that are both inaccurate and prejudicial on the merits, Ms. Ball asserts. She insists that nothing in any certification order should decide the merits or prejudice any party with regard to the merits. About Chrysler LLC Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Mopar(R) and Global Electric Motors (GEM) brand vehicles and products. With the resources, technology and worldwide distribution network required to compete on a global scale, the alliance builds on Chrysler's culture of innovation -- first established by Walter P. Chrysler in 1925 -- and Fiat's complementary technology -- from a company whose heritage dates back to 1899. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Dodge Ram. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CIENA CORP: S&P Puts 'B+' Corp. Rating on CreditWatch Negative -------------------------------------------------------------- Standard & Poor's Ratings Services said it placed its 'B+' corporate credit and senior unsecured ratings on Linthicum, Maryland-based Ciena Corp. on CreditWatch with negative implications. "The rating action reflects S&P's concerns that liquidity will be significantly depleted over the next 12 months," said Standard & Poor's credit analyst Lucy Patricola. S&P expects the acquisition and integration costs to be $570 million. Further, it remains uncertain if the structure of the transaction, whereby Ciena has agreed to extend offers to at least 2,000 Nortel employees and enter into transition services agreements for about $100 million annually, eliminates or reduces historical operating losses that were generated when Nortel owned the assets. CIRCUIT CITY: To Present Liquidating Plan for Confirmation Nov. 23 ------------------------------------------------------------------ Judge Kevin Huennekens of the U.S. Bankruptcy Court for the Eastern District of Virginia issued an official order on September 24, 2009, approving the disclosure statement explaining the First Amended Joint Plan of Liquidation filed by Circuit City Stores, Inc., its affiliated debtors, and its Official Committee of Unsecured Creditors. To recall, the Court approved the Debtors' Disclosure Statement at a hearing held September 22, 2009, noting that "a proposed order approving disclosure statement" is to be submitted by the Debtors' counsel. In his Sept. 24 order, Judge Huennekens held that the Disclosure Statement complies with the requirements of the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure, and contains adequate information as the term is defined in Section 1125 of the Bankruptcy Code. The Plan Proponents also filed on September 24, 2009, clean and final version of their Disclosure Statement and First Amended Plan, a full-text copy of which is available at no charge at: http://bankrupt.com/misc/CC_DS&1stAmPlan_092409.pdf The hearing to consider confirmation of the First Amended Joint Plan of Liquidation of the Debtors and the Official Committee of Unsecured Creditors, as may be further modified or amended, will commence on November 23, 2009. The deadline for filing objections to the confirmation of the Plan is November 16, 2009, at 4:00 p.m., Eastern Time. A full-text copy of the Disclosure Statement Order, including exhibits, is available at no charge at: http://bankrupt.com/misc/CC_OrdDisclosureStatement092409.pdf Confirmation Schedule In an order dated September 24, 2009, Judge Kevin Huennekens approved the Plan Proponents' proposed solicitation, voting and tabulation procedures. The Court approved the establishment of: September 22, 2009 Voting Record Date September 30, 2009 Solicitation Mailing Date September 30, 2009 Deadline to Publish Confirmation Hearing Notice October 20, 2009 Deadline for Debtors to Object to Claims For Voting Purposes November 5, 2009 Exhibit Filing Deadline November 10, 2009 Voting Deadline November 10, 2009 Rule 3018(a) Motion Deadline November 16, 2009 Confirmation Objection Deadline November 23, 2009 Confirmation Hearing The Plan Proponents will give supplemental publication notice of the Confirmation Hearing by causing the Confirmation Hearing Notice to be published before, or as soon as practicable after September 30, 2009, but in any event not fewer than 25 days before the Confirmation Hearing in the Wall Street Journal (Global Edition), the New York Times and the Richmond Times Dispatch. Kurtzman Carson Consultants, LLC is authorized to be Debtors' solicitation and noticing agent to assist the Plan Proponents in mailing Solicitation Packages and notices, receiving and tabulating Ballots cast on the Plan, and certifying to the Court the results of balloting. The Plan Proponents will file all exhibits and schedules to the Plan and appendices to the Disclosure Statement with the Court on or before November 5, 2009. The Liquidating Plan The Plan provides for the orderly liquidation of the remaining assets of the Debtors and the distribution of the proceeds of the liquidation of the Debtors' assets according to the priorities set forth under the Bankruptcy Code. Under the Debtors' Joint Plan of Liquidation, all claims against the Debtors -- other than administrative claims and priority tax claims, which will be paid in full -- are classified into eight classes: Estimated Estimated Aggregate Amount Class Description Recovery of Allowed Claims ----- ----------- --------- ----------------- 1 Miscellaneous Secured Claims 100% $5 mil.-$20 mil. 2 Non-Tax Priority Claims 100% $35 mil.-$95 mil. 3 Convenience Claims 10% unknown 4 General Unsecured Claims 0%-13.5% $1.8 bil.-$2 bil. 5 Intercompany Claims 0% $0 6 Subordinated 510(c) Claims 0% $0 7 Subordinated 510(b) Claims 0% $0 8 Interests 0% - A Liquidating Trust will be established on the Plan Effective Date. All Distributions to the Holders of allowed claims will be from the Liquidating Trust. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or215/945-7000). CIRCUIT CITY: Douglas County Objects to Confirmation of Plan ------------------------------------------------------------ Sharon K. Jones, treasurer of Douglas County, Colorado, objects to confirmation of Circuit City Stores Inc.'s Joint Plan of Liquidation because: (a) the Plan ignores the priority of Douglas County's statutory property tax lien, which is senior to all other liens; and (b) the Plan fails to pay interest on Douglas County's statutory tax claim, as required by Sections 506(b) and 511(a) of the Bankruptcy Code. Ms. Jones asserts that the Plan should provide that (i) in the event there is insufficient available cash to pay all Allowed Miscellaneous Secured Claims in full, Allowed Miscellaneous Secured Claims will be paid in the order of their lien priorities, and (ii) interest will be paid on all property tax claims at the rate determined under applicable non-bankruptcy law until the property tax claims are paid in full. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or215/945-7000). CIRCUIT CITY: Proposes Settlement Agreement With PBGC ----------------------------------------------------- Pursuant to Sections 105 and 363 of the Bankruptcy Code and Rule 9019 of the Federal Rules of Bankruptcy Procedure, the Debtors ask the Court to approve the settlement agreement and stipulation with Pension Benefit Guaranty Corporation. The Debtors previously maintained the Retirement Plan of Circuit City Stores, Inc., as amended, to provide retirement benefits for certain of its employees. On March 31, 2009, the Pension Plan was terminated and PBGC was appointed statutory trustee of the Pension Plan pursuant to Section 1342 of the Labor Code. As a result, PBGC assumed the assets and liabilities of the Pension Plan and is responsible for paying benefits under the Pension Plan, up to the levels permitted by law, Douglas M. Foley, Esq., at McGuireWoods LLP, in Richmond, Virginia, the Debtors' counsel, relates. The Pension Plan had approximately 22,000 participants on the Termination Date. No due and unpaid contributions were owed to the Pension Plan, but PBGC estimated that the difference between the present value of the Pension Plan assets on March 31, 2009, and the value of benefit liabilities under the plan as determined under Title IV of ERISA as of March 31, 2009, was $36,900,000, according to Mr. Foley. PBGC Claims On January 30, 2009, PBGC filed three proofs of claim, which claims it later amended, in each of the Debtors' cases -- the PBGC Claims. Specifically, the PBGC filed amended proofs of claim number (i) 14470 -- Minimum Funding Claim, (ii) 14491 -- Unfunded Benefit Liabilities Claim, and (iii) 14471 -- Premium Claim. The PBGC also contends that the Debtors are jointly and severally liable for all of the PBGC Claims, according to Mr. Foley. The Minimum Funding Claim was filed on account of minimum contributions allegedly due, but unpaid, under the Pension Plan. The PBGC filed that Claim in the amount of $0, but reserved its right to further amend the proof of claim. The Unfunded Benefit Liabilities Claim asserts liability for the Pension Plan's alleged Unfunded Benefit Liabilities measured as of March 31, 2009. Based on PBGC's calculation under ERISA and its accompanying regulations, PBGC alleges that the Pension Plan's Unfunded Benefit Liabilities are $36,900,000. The Premium Claim was bifurcated into two claims -- the Annual Premium Claim and the Termination Premium Claim. The Annual Premium Claim was filed as an administrative expense and seeks payment of annual flat rate and variable-rate premiums allegedly arising under Section 1306(a)(3) of the Labor Code after the Petition Date. The flat-rate premium is a flat dollar amount per participant per year, which is currently $33. The variable-rate premium is $9 for each $1,000 of the plan's unfunded vested benefits each year. PBGC asserts that the total amount of unpaid flat-rate and variable-rate premiums for the Pension Plan equals $159,076. The Termination Premium Claim was filed on account of termination premiums allegedly due under Section 1306(a)(7) of the Labor Code. Termination Premiums total $1,250 for each participant in a pension plan immediately before the plan termination, and are due for a period of three years. In the case of the Pension Plan, there were approximately 22,000 participants before its termination. Based on these figures, PBGC asserts that the Debtors are liable for Termination Premiums totaling $82,091,250. The Debtors assert that each of the PBGC Claims should be disallowed, reclassified as a general unsecured claim, or allowed in a significantly reduced amount pursuant to applicable law. Settlement Agreement Rather than engage in protracted litigation with PBGC and in light of the costs, risks and delays associated with litigating the outstanding disputes between the parties, the Debtors determined to settle the disputes with PBGC. After arm's-length negotiations, the Debtors and PBGC have agreed to resolve their disputes in accordance with the terms of the Settlement Agreement, which include: (a) PBGC will have an allowed claim equal to $33,500,000 in Case No. 08-35653, which will be paid in the full amount. (b) PBGC will neither vote to accept nor reject the First Amended Joint Plan of Liquidation of the Debtors and the Official Committee of Unsecured Creditors, which was filed on September 29, 2009. (c) The Debtors will add certain language to the Plan with respect to PBGC. PBGC also provides certain release to the Debtors. (d) Except with regard to any preserved claim, upon payment of the Settlement Payment, the PBGC Claims, together with any other claims obligations, suits, judgments, damages, demands, debts, rights, causes of action, and liabilities against the Debtors held by PBGC, will be deemed fully and finally satisfied. A copy of the Settlement Agreement is available at no charge at http://bankrupt.com/misc/CC_PBGCsettlement100509.pdf In a separate filing, the Debtors ask the Court to approve shortened and limited notice of the Motion. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or215/945-7000). CIRCUIT CITY: Proposes to Reject Safeco Surety Bonds ---------------------------------------------------- Circuit City Stores Inc. and its affiliates, pursuant to Sections 105(a), 362(d)(1), and 365(a) of the Bankruptcy Code, Rules 4001 and 6006 of the Federal Rules of Bankruptcy Procedure, and Rule 4001 of the Local Bankruptcy Rules for the United States Bankruptcy Court for the Eastern District of Virginia, ask the Court (i) for authority to reject certain surety bonds, (ii) to modify the automatic stay for the limited purpose of allowing Safeco Insurance Company of America to commence cancellation of surety bonds, and (iii) to establish a surety bond claim deadline. Circuit City Stores, Inc., executed an agreement dated July 9, 1992, pursuant to which it, as principal, agreed to indemnify Safeco, as surety, from all losses and expenses in connection with any surety bonds for which Safeco agreed to become a surety. Safeco issued numerous Surety Bonds on behalf of the Debtors after Circuit City executed the General Indemnity Agreement, Douglas M. Foley, Esq., at McGuireWoods LLP, in Richmond, Virginia, relates. To secure their obligations under the General Indemnity Agreement, the Debtors arranged for a letter of credit in favor of Safeco through Bank of America, N.A. The Safeco LC was scheduled to expire on July 11, 2009, and Bank of America was unwilling to extend the Safeco LC. As a result, on June 16, 2009, Safeco drew down the remaining amount of the Safeco LC in the amount of $4,700,000, which it is currently holding or has used to pay Surety Bond Claims, according to Mr. Foley. The Debtors are principals, and Safeco is surety to more than 100 Surety Bonds at present. A list of the Debtors' outstanding Surety Bonds is available at no charge at: http://bankrupt.com/misc/CC_SuretyBonds092509.pdf Mr. Foley relates that the Surety Bonds were issued for "myriad purposes, including but not limited to, securing the payment of utility services, taxes, importer duties, various state licenses and fees, and pursuant to various statutes." Under the Surety Bonds, the Debtors and Safeco have potential joint or several liability in excess of $5,000,000. In addition, pursuant to the General Indemnity Agreement, the Debtors may also be liable to Safeco for other amounts, Mr. Foley informs the Court. He says that since the Petition Date, Safeco has received over 40 prepetition claims and several postpetition claims against the Debtors' outstanding Surety Bonds. The aggregate amount of the Surety Bond Claims is, presently, in excess of $1,000,000. Because the Debtors are in the process of liquidating their assets for the benefit of their creditors, and the Debtors have closed and vacated the premises of all of their retail stores, the Surety Bonds are no longer necessary for the Debtors to carry on their businesses and they are burdensome to the Debtors' bankruptcy estates, Mr. Foley tells the Court. The Debtors also wish to exercise their rights and abilities to cancel many, if not all, of the Surety Bonds. Many of the Surety Bonds authorize Safeco, either pursuant to the terms of the Surety Bonds, or by relevant statute or regulation, to provide a notice of the cancellation of the Surety Bonds to the applicable Surety Bond's obligees effective as of a certain date. The Debtors and Safeco have agreed to cooperate in the process of canceling the Surety Bonds, whether it is by the Debtors' actions or Safeco's actions. Although the Debtors believe that they are permitted to cancel the Surety Bonds without violating the automatic stay, out of an abundance of caution and to ensure that Safeco does not run afoul of the automatic stay, the Debtors and Safeco have determined that modifying the automatic stay would be prudent before any cancellations are commenced. Once the stay is modified, either the Debtors or Safeco, or both, will take all necessary and appropriate actions to cancel the Surety Bonds, according to Mr. Foley. Cancellation Procedures To streamline the claims process, the Debtors propose these procedures: (a) To commence cancellation of any Surety Bond, Safeco will provide a written notice to the Debtors of its intent to take actions to cancel one or more specific Surety Bonds. The Debtors may provide their written consent to Safeco within 10 business days after receipt of the notice. The Debtors' failure to respond within 10 business days will be deemed to be the Debtors' written objection, in which case Safeco will not be permitted to take any further action without either the Debtors' subsequent written consent or pursuant to a subsequent Court order. (b) In the event they consent to Safeco's cancellation of any Surety Bond, the Debtors will file a notice with the Court of Safeco's intent to cancel certain Surety Bonds. The date set forth in the Cancellation Notice as the date the Surety Bond will be deemed canceled is the Cancellation Effective Date. The Cancellation Effective Date will occur 60 days after the Cancellation Notice is filed with the Court. In the event a Surety Bond, by its terms, requires more than 60 days' notice before cancellation will be effective, the last day of the term prescribed by the Surety Bond will be its Cancellation Effective Date. The Debtors request that the Court establish a Surety Bond Claim deadline of no later than 60 days after the applicable Cancellation Effective Date for each Surety Bond Obligee to file a Surety Bond Claim with Safeco on account of any and all claims arising from or related to its canceled Surety Bond. The failure of a Surety Bond Obligee to file a Claim will release and discharge the Debtors and Safeco from any Surety Bond Claim that could have been made by the Obligee, and any Surety Bond Claim will be barred against the Debtors and Safeco forever by Court order. In the event any Surety Bond Claim is less than the total penal sum of the applicable canceled Surety Bond, the Debtors request that any order entered direct Safeco to return a portion of the Safeco LC, which portion will be equal to the total penal sum of the canceled Surety Bond less any Surety Bond Claim made against the Surety Bond. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. Bankruptcy Creditors' Service, Inc., publishes Circuit City Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Circuit City Stores Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or215/945-7000). CIRCUIT CITY: Objection to Employees' Time Off Claims Overruled --------------------------------------------------------------- The Bankruptcy Court has overruled Circuit City Stores Inc.'s attempts to discard former employees' claims for payment of accrued time off. In their 25th Omnibus Claims Objection, the Debtors sought to disallow 500 claims, aggregating $534,423, asserted by former employees of the Debtors for paid time off under a corporate policy that was amended prepetition. The Debtors related that they have amended the Paid Time Off Policy on the Petition Date, eliminating the accrual of Paid Time Off. The Debtors tell the Court that the employees were no longer entitled to Paid Time Off, under the new policy, at the termination of their employment. The employees have been advised of the change, according to the Debtors. A list of the Paid Time Off Claims is available for free at http://bankrupt.com/misc/CC_Omni25Claims.pdf These creditors responded to the Objection: Kenneth Robert Porter; Jose A. Garcia; Amy Fiaa; Joseph M. Stroh; Hillsborough County, Florida; Ann M. Karr; Deborah J. Koeneman; Joshua G. Bowden; Robert Conat; Kevin J. Stephens; Suzanne Laxson; Bryan Seymour; Jason L. Binkley; George H. Burns; Mary A. Garza; Wendy T. Housden; David M. Anderson; Andrew F. Belovich; Thomas Fox; John L. Morrison II; John W. Walker; Robert M. Sayen; Joshua L. Adams; Christopher E. Gibson; Sheila Lewis; Terrell A. Woods; Mayda Racines; and James P. Moran. In accordance with the Memorandum Opinion dated October 6, 2009, the Court found that the Debtors failed to effectively communicate their policy change regarding Paid Time Off to their employees. The Court has concluded that those Claimants who timely responded to Debtors' Twenty-fifth Omnibus Objection are entitled to assert a priority claim in accordance with Section 507(a)(4)(A) of the Bankruptcy Code. The Debtors' Objection is overruled with respect to the Responding Claimants and their claims will be allowed. Otherwise, the Objection is sustained, and the remaining claims are dismissed. About Circuit City Headquartered in Richmond, Virginia, Circuit City Stores Inc. (NYSE: CC) -- http://www.circuitcity.com/-- was a specialty retailer of consumer electronics, home office products, entertainment software and related services in the U.S. and Canada. Circuit City Stores together with 17 affiliates filed a voluntary petition for reorganization relief under Chapter 11 of the Bankruptcy Code on November 10 (Bankr. E.D. Va. Lead Case No. 08- 35653). InterTAN Canada, Ltd., which runs Circuit City's Canadian operations, also sought protection under the Companies' Creditors Arrangement Act in Canada. Gregg M. Galardi, Esq., and Ian S. Fredericks, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, are the Debtors' general restructuring counsel. Dion W. Hayes, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, are the Debtors' local counsel. The Debtors also tapped Kirkland & Ellis LLP as special financing counsel; Wilmer, Cutler, Pickering, Hale and Dorr, LLP, as special securities counsel; and FTI Consulting, Inc., and Rotschild Inc. as financial advisors. The Debtors' Canadian general restructuring counsel is Osler, Hoskin & Harcourt LLP. Kurtzman Carson Consultants LLC is the Debtors' claims and voting agent. The Debtors disclosed total assets of $3,400,080,000 and debts of $2,323,328,000 as of August 31, 2008. Circuit City has opted to liquidate its 721 stores. It has obtained the Bankruptcy Court's approval to pursue going-out-of- business sales, and sell its store leases. CITIGROUP INC: Execs Reshuffling May Be Needed, Says Egon Zehnder ----------------------------------------------------------------- A review conducted by recruiting and consulting firm Egon Zehnder International on Citigroup Inc.'s management team concluded that it is generally in good shape but that some shuffling of senior executives might be needed, David Enrich and Joann S. Lublin at The Wall Street Journal report, citing people familiar with the matter. The Journal relates that the review was due to the government's stress tests of top banks last spring, as companies found to need more capital were required to hire outside firms to conduct assessments of their management and report the findings to federal regulators. According to The Journal, the sources said that Egon Zehnder's report awarded strong overall marks to Citigroup's management team and to its CEO, Vikram Pandit, in particular. The report says that the Federal Deposit Insurance Corp. has had concerns about the qualifications of Mr. Pandit and his top management. Citing people familiar with the matter, The Journal states that Egon Zehnder's report provided less-favorable assessments of at least two of Mr. Pandit's lieutenants, Vice Chairman Lewis Kaden - - whose responsibilities include Citigroup's legal, human- resources and government-relations departments -- and Chief Administrative Officer Don Callahan, who is in charge of Citigroup's operations and technology. Review Questioned Some Federal Deposit Insurance Corp. staff doubt recruiting and consulting firm Egon Zehnder International's generally positive conclusions in a government-mandated review of Citigroup Inc.'s top management, David Enrich and Randall Smith at The Wall Street Journal report, citing people familiar with the matter. The Journal notes that the skeptical reaction could cause the FDIC to give the report little weight during the next regulatory assessment of Citigroup's management. According to The Journal, the sources said that the report was based partly on interviews of Citigroup executives who were asked to rate the effectiveness of their colleagues. About Citigroup Inc. Based in New York, Citigroup Inc. (NYSE: C) -- http://www.citigroup.com/-- is organized into four major segments -- Consumer Banking, Global Cards, Institutional Clients Group, and Global Wealth Management. At June 30, 2009, Citigroup had total assets of $1.84 trillion and total liabilities of $1.69 trillion. As reported in the Troubled Company Reporter on November 25, 2008, the U.S. government entered into an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. The U.S. Treasury and the Federal Deposit Insurance Corporation agreed to provide protection against the possibility of unusually large losses on an asset pool of roughly $306 billion of loans and securities backed by residential and commercial real estate and other such assets, which will remain on Citigroup's balance sheet. As a fee for this arrangement, Citigroup issued preferred shares to the Treasury and FDIC. The Federal Reserve agreed to backstop residual risk in the asset pool through a non-recourse loan. Citigroup, the third-biggest U.S. bank, received $52 billion in bailout aid. Other bailed-out banks, including Bank of America Corp., Wells Fargo & Co., have pledged to repay TARP money. JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley, repaid TARP funds in June. Citigroup is one of the banks that, according to results of the government's stress test, need more capital. CLARIENT INC: Deloitte Replaces KPMG as Outside Auditors -------------------------------------------------------- The Audit Committee of the Board of Directors of Clarient, Inc., recently conducted a competitive process to determine Clarient's independent registered public accounting firm for its 2009 fiscal year. The Audit Committee invited three national accounting firms to participate in this process, including KPMG LLP, Clarient's current independent registered public accounting firm. As a result of this process, the Audit Committee approved, on behalf of Clarient, the dismissal of KPMG as Clarient's independent registered public accounting firm, effective September 22, 2009. KPMG's audit reports on Clarient's consolidated financial statements as of and for the years ended December 31, 2008, and December 31, 2007, did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to audit scope or accounting principles, except as follows: -- KPMG's audit reports on Clarient's consolidated financial statements as of and for the years ended December 31, 2008 and 2007 contained a separate paragraph stating that, "the Company [Clarient] has suffered recurring losses from operations and negative cash flows from operations and has working capital and net capital deficiencies. In addition, it is not probable that the Company [Clarient] can remain in compliance with the restrictive financial covenants in its bank credit facilities. These matters raise substantial doubt about the Company's [Clarient's] ability to continue as a going concern. . . ." The audit reports also refer to Clarient's change in its method of accounting for uncertainties in income taxes in 2007. -- During the two fiscal years ended December 31, 2008, and the subsequent interim period through September 22, 2009, there were no disagreements between Clarient and KPMG on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure which, if not resolved to KPMG's satisfaction, would have caused KPMG to make reference to the subject matter of the disagreement in connection with its report for such years within the meaning of Item 304(a)(1)(iv) of Regulation S-K. In addition, during the period identified, there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K, except such material weaknesses identified by Clarient in Item 9A. Controls and Procedures within its Annual Report on Form 10-K for the fiscal years ended December 31, 2008 and 2007. As a result of the auditor search, the Audit Committee approved, on behalf of Clarient, the engagement of Deloitte & Touche LLP to serve as Clarient's independent registered public accounting firm for fiscal 2009. During the two fiscal years ended December 31, 2008, and the subsequent interim period through September 22, 2009, neither Clarient, nor anyone acting on its behalf, consulted with D&T regarding (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on Clarient's financial statements, or (ii) any of the matters or events set forth in Item 304(a)(2)(ii) of Regulation S-K. About Clarient Inc. Based in Aliso Viejo, California, Clarient Inc. (Nasdaq: CLRT) -- http://www.clarientinc.com/-- is an advanced oncology diagnostics services company. The Company's principal customers include pathologists, oncologists, hospitals and biopharmaceutical companies. At June 30, 2009, Clarient had $54.3 million in total assets; $13.8 million in total current liabilities, $982,000 in long-term capital lease obligations and $3.75 million in deferred rent and other non-current liabilities; and $35.6 million in stockholders' equity. CLEAR CHANNEL: Denies Loan Restructuring Talks with Banks --------------------------------------------------------- Clear Channel Communications Inc.'s owners -- Bain Capital LLC and THL Partners -- denied a media report that the private equity firms have contacted banks in an effort to restructure Clear Channel loans, the New York Times reported. A spokesman for the partnership told the NYT that no effort to restructure the company's debt is currently under way. The New York Post reported that Clear Channel's private equity owners had approached banks to help them keep Clear Channel from defaulting on its loans. Citing sources, The NY Post stated that Clear Channel may default by year-end or early in 2010. Clear Channel Communications, Inc. -- http://www.clearchannel.com/ -- is a diversified media company with three primary business segments: radio broadcasting, outdoor advertising and live entertainment. Clear Channel Communications is the operating subsidiary of San Antonio, Texas-based CC Media Holdings, Inc. Clear Channel Communications, Inc.'s balance sheet at March 31, 2009, showed total assets of $22.0 billion and total liabilities of $25.4 billion, resulting in a members' deficit of $3.3 billion Clear Channel carries a 'Caa3' probability-of-default rating from Moody's. CLEARPOINT BUSINESS: ComVest Appointees to Serve Until Dec. 27 -------------------------------------------------------------- ClearPoint Business Resources, Inc., on August 14, 2009, entered into an Amended and Restated Revolving Credit Agreement with ComVest Capital, LLC. The Loan Agreement provided that the Company's Board of Directors should, on or prior to September 28, 2009, include two members designated by ComVest, each to be placed within separate classes of the Board and each of whom will be unaffiliated with and independent of ComVest. On October 7, 2009, the Company and ComVest entered into a Letter Amendment to the Loan Agreement pursuant to which the parties agreed to extend the Company's obligation to have such directors serve on the Board until December 27, 2009. Going Concern Opinion Historically, ClearPoint has funded its cash and liquidity needs through cash generated from operations and debt financing. At June 30, 2009, the Company had an accumulated deficit of $55,412,191 and working capital deficiency of $8,904,055. Although the Company restructured its debt and obtained new financing in the third quarter of 2009, cash projected to be generated from operations may not be sufficient to fund operations and meet debt repayment obligations during the next 12 months. To meet its future cash and liquidity needs, the Company may be required to raise additional financing and restructure existing debt. There is no assurance that the Company will be successful in obtaining additional financing and restructuring its existing debt. If the Company does not generate sufficient cash from operations, raise additional financing and restructure existing debt, there is substantial doubt about the ability of the Company to continue as a going concern. During the six months ended June 30, 2009, ClearPoint did not make certain required payments under the Loan Agreement with ComVest, the Blue Lake Note, the Sub Notes payable to Sub Noteholders and the StaffBridge Note. About ClearPoint Business Resources ClearPoint Business Resources, Inc., is a workplace management solutions company. Through the iLabor Network, ClearPoint provides services to clients ranging from small businesses to Fortune 500 companies. The iLabor Network specializes in the highly transactional "go to work" or "on-demand" segment of the temporary labor market. ClearPoint considers the hospitality, distribution, warehouse, manufacturing, logistics, transportation, convention services, hotel chains, retail and administrative sectors among the segments best able to be served by the iLabor Network. During the fiscal year ended December 31, 2008, ClearPoint began to transition its business model from a temporary staffing provider through a network of branch-based offices or franchises to a provider that manages clients' temporary staffing needs through its open Internet portal-based iLabor Network. ClearPoint completed this transition during the three months ended June 30, 2008. Under its new business model, ClearPoint acts as a broker for its clients and network of temporary staffing suppliers. ClearPoint derives its revenues from (i) royalty payments related to client contracts which ClearPoint subcontracted or sold to other providers of temporary staffing services; (ii) revenues generated by the iLabor Network; and (iii) revenues related to VMS. As of June 30, 2009, the Company had $3,492,403 in total assets and $26,262,146 in total liabilities, resulting in $22,769,743 in stockholders' deficit. COLLINS & AIKMAN: Visteon Reliance on Lawyer Not Excusable Neglect ------------------------------------------------------------------ According to Bill Rochelle at Bloomberg News, U.S. District Judge Gerald E. Rosen affirmed a ruling by the bankruptcy court presiding over Collins & Aikman Corp.'s case that denied a set-off request by Visteon Corp. Visteon said its lawyer reached an agreement with a Collins & Aikman lawyer regarding a set-off of the company's claims against each other. The deal, however, was not made in writing and was not presented to the court for approval. As reported in the Troubled Company Reporter on July 22, 2005, Visteon asked the U.S. Bankruptcy Court for the Eastern District of Michigan to lift the automatic stay to set off its mutual prepetition debt with the Debtors. Prior to C&A's Chapter 11 petition date, Visteon provided component parts to Collins for which it remains unpaid. Collins allegedly owed Visteon $2,217,171. The Debtors also provided component parts to Visteon for which they remain unpaid. The amount owing from Visteon total $43,667. Visteon later said that it has agreed with Collins regarding a withdrawal of the lift stay request. However, at the time when Collins & Aikman's Chapter 11 plan was already implemented, Visteon went to the bankruptcy court to seek approval of the set-off. The bankruptcy court denied the proposal, noting that it was already enjoined by confirmation of the plan. On appeal Judge Rosen ruled that "another party's assurances, standing alone, cannot defeat a party's obligation to meet a court ordered deadline." The judge said that reliance on another party is not excusable neglect overcoming the failure to meet a deadline. The case is Visteon Corp. v. Collins & Aikman Corp. (In re Collins & Aikman Corp.), 07-13714, U.S. District Court, Eastern District Michigan (Bay City). About Collins & Aikman Headquartered in Troy, Mich., Collins & Aikman Corporation -- http://www.collinsaikman.com/-- is a global leader in cockpit modules and automotive floor and acoustic systems and is a leading supplier of instrument panels, automotive fabric, plastic-based trim, and convertible top systems. The Company has a workforce of approximately 23,000 and a network of more than 100 technical centers, sales offices and manufacturing sites in 17 countries throughout the world. The Company and its debtor-affiliates filed for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case No. 05-55927). Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represents C&A in its restructuring. Lazard Freres & Co., LLC, provides the Debtors with investment banking services. Michael S. Stammer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors Committee. When the Debtors filed for protection from their creditors, they listed $3,196,700,000 in total assets and $2,856,600,000 in total debts. On Aug. 30, 2006, the Debtors filed a Joint Chapter 11 Plan and a Disclosure Statement explaining that plan. On Dec. 22, 2006, they filed an Amended Plan and on Jan. 22, 2007, filed a modified Amended Plan. On Jan. 25, 2007, the Court approved the adequacy of the Disclosure Statement. On July 18, 2007, the Court confirmed the Debtors' Liquidation Plan which became effective on Oct. 12, 2007. COMSTOCK RESOURCES: Moody's Assigns 'B2' Rating on $200 Mil. Notes ------------------------------------------------------------------ Moody's Investors Service assigned a B2 rating to Comstock Resources, Inc.'s proposed offering of $200 million senior unsecured notes due 2017. Moody's also affirmed Comstock's B1 Corporate Family Rating and the B2 rating on the company's existing $175 million senior unsecured notes due 2012. The outlook is stable. "This bond offering refinances outstanding revolver borrowings and provides additional cash to fund planned Haynesville development," commented Pete Speer, Moody's Vice President. "While this will increase Comstock's debt levels, it entered 2009 with low leverage metrics relative to similarly rated peers." Pro forma for the notes offering, Comstock's adjusted debt/PD and adjusted debt/average daily production were under $6/boe and $12,500/boe at September 30, 2009. These leverage metrics are elevated from the beginning of the year but remain meaningfully below B1 peer averages. This lower leverage somewhat offsets Comstock's smaller reserve and production scale relative to peers and its growing concentration in the Haynesville shale play. However, Comstock has been and plans to continue outspending cash flow over the coming year to develop its Haynesville acreage and achieve a high level of sequential quarterly production growth. The resulting increases in debt will require a commensurate increase in production and proved developed reserves to avoid a further escalation in leverage metrics that could pressure the ratings. If Comstock does not meet its production growth forecasts and/or the resulting proved reserves additions are not achieved at competitive costs, the ratings outlook could be changed to negative or the ratings downgraded. The proceeds from the new notes offering will be used to pay down approximately $165 million of borrowings outstanding on Comstock's senior secured revolving credit facility. Following the notes offering, Comstock will have around $30 million of cash and a fully un-drawn revolver with a borrowing base estimated to be $500 million. This provides Comstock with sound liquidity through the end of 2010 even with the company's expected negative free cash flow, full exposure to natural gas price fluctuations and the potential for negative borrowing base re-determinations in the future. The B2 senior unsecured note rating reflects both the overall probability of default of Comstock, to which Moody's assigns a PDR of B1, and a loss given default of LGD 5 (75%). The $500 million borrowing base is still large enough to result in a double notching of the senior unsecured notes down from the B1 CFR under Moody's Loss Given Default Methodology. However, Moody's has affirmed the existing B2 notes rating based on the revolver borrowings being refinanced with unsecured debt and expected utilization of the revolver over the coming year. The last rating action was on July 20, 2009, when Moody's affirmed Comstock's B1 CFR and the B2 rating on the company's $175 million senior unsecured notes. Comstock Resources, Inc., is an independent exploration and production company headquartered in Frisco, Texas. COMSTOCK RESOURCES: S&P Assigns 'B' Rating on $200 Mil. Notes ------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned issue- level and recovery ratings to Comstock Resources Inc.'s proposed $200 million senior unsecured notes due 2017. The issue-level rating is 'B' (two notches below the corporate credit rating). The recovery rating is '6', indicating S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. "S&P's recovery analysis incorporates the proposed notes offering and the expected reduction in the company's borrowing base as a result of the note offering," said Standard & Poor's credit analyst Amy Eddy. The Frisco, Texas-based natural gas and crude oil exploration and production company intends to use the proceeds from the issue to pay down debt outstanding under its revolving credit facility. Pro forma for the notes issuance, S&P expects that Comstock will have full availability under an approximate $500 million borrowing base revolving credit facility due 2011 as well as about $30 million in cash. The corporate credit rating on Comstock is 'BB-', and the outlook is stable. Ratings List Comstock Resources Inc. Corporate credit rating BB-/Stable/-- New Rating Comstock Resources Inc. $200M senior unsecured notes due 2017 B Recovery rating 6 CONVERGYS CORPORATION: Fitch Assigns ' BB+' Rating on Junior Bonds ------------------------------------------------------------------ Fitch Ratings has assigned a 'BB+' rating to Convergys Corporation's new 5.75% junior subordinated convertible debentures due 2029 issued in conjunction with the company's debt exchange that concluded on Oct. 6, 2009. Fitch has also affirmed the company's existing ratings: -- Long-term Issuer Default Rating at 'BBB-'; -- Senior unsecured revolving credit facility at 'BBB-'; -- Senior unsecured notes at 'BBB-'; -- Short-term IDR at 'F3'; -- Commercial paper program at 'F3'. Approximately $610 million of debt is affected by Fitch's action. The Rating Outlook is Negative. Fitch's rating concerns and Negative Outlook center on Convergys': -- Continued implementation challenges and free cash flow pressure relating to two significant Human Resources Management contracts, as well as uncertainty regarding the timing and ultimate resolution of ongoing client negotiations to restructure these contracts; -- Continued revenue pressures expected in the second half of 2009 due primarily to lower than expected call volume under existing Customer Management contracts, partially offset by revenue from new contract signings; -- Continued decline in funds flow from operations, defined as cash flow from operations minus the change in working capital, as the increase in CFO in the last 12 months ended June 30, 2009, was driven entirely by significant working capital improvements, primarily accounts receivable. Since Fitch believes further improvement in the company's cash conversion cycle is limited, CFO going forward will approximate FFO, resulting in lower free cash flow in the absence of increases in FFO. In the LTM ended June 30, 2009, FFO was approximately $165 million, representing declines of 14% and 54% compared with the corresponding periods in 2008 and 2007, respectively. The ratings are supported by Convergys': -- Strengthened liquidity position from the aforementioned debt exchange; -- Significant profitability improvement in CM (70% of total revenue) with gross margin increasing by 7.4 percentage points to nearly 38% in the quarter ended June 30, 2009, the highest in the last five years; -- Significant recurring revenue base primarily from long-term CM contracts partially offset by fluctuations in call volumes with existing clients; -- Long-term customer relationships. Negative rating actions could occur if: -- Funds flow from operations continues to deteriorate, resulting in a material decline in liquidity. -- Convergys ceases to provide CM services to any of its largest customers, including AT&T Inc. (rated 'A', Stable Outlook by Fitch), Comcast Corporation (rated 'BBB+', Stable Outlook) or DirecTV, which Fitch views as unlikely in the absence of an acquisition given the significant switching costs of transitioning customer care either in-house or to an alternate third-party vendor, and considering the company's established, long-term relationships with its largest customers. Positive rating actions could occur if Convergys: -- Achieves a favorable resolution with respect to ongoing client negotiations to restructure two HRM outsourcing contracts, resulting in lower implementation costs and greater and more consistent FFO; -- The company continues to expand into new industries, enabling greater diversity of its revenue base by further reducing customer (AT&T/Sprint) and industry concentration (communications). Under the terms of the debt exchange, Convergys offered up to $125 million of new 5.75% junior subordinated convertible debentures due Sept. 15, 2029, in exchange for up to $122.5 million of its 4.875% senior notes due Dec. 15, 2009 ($193 million outstanding at June 30). Approximately $171 million of existing senior notes were tendered (oversubscribed), thereby reducing remaining debt maturities in 2009 by nearly $123 million to approximately $70 million in exchange for $125 million of new 2029 debentures. Fitch assigns zero equity credit to the junior subordinate convertible debentures primarily due to a lack of coupon deferral or mandatory equity conversion, which limit the company's financial flexibility in times of financial duress. The indenture governing the debentures has no financial covenants, but includes a change of control. Fitch believes the debt exchange will not have a material effect on the company's credit metrics. Excluding special charges, Fitch projects leverage (total debt/operating EBITDA) will decline to 1.8 times from 2.1x as of June 30, 2009 and 2.2x at year-end 2008. Fitch believes interest coverage (EBITDA/gross interest expense) will decline to 10x in 2009 from approximately 13x in 2008. However, Fitch estimates the inclusion of $88 million of cash charges relating to excess HRM implementation costs incurred in second-quarter 2009 increases projected year-end 2009 leverage to 2.6x and reduces interest coverage to 7x. Convergys' liquidity position pro forma for the debt exchange has strengthened markedly to nearly $619 million as of June 30, 2009 after reaching a five-year low of $122 million as of year-end 2008. Fitch derives one-year liquidity based on the difference between liquidity sources (cash + revolver availability + securitization availability + trailing 12 months [TTM] CFO + any other sources) and required liquidity uses (TTM capital expenditures + current debt maturities + TTM dividends + any other uses). The improved liquidity position primarily reflects a significant improvement in free cash flow to nearly $236 million in the LTM ended June 30, 2009 compared with $91 million in 2008, albeit primarily reflecting a nearly nine-day reduction in days sales outstanding, a new undrawn $125 million A/R securitization facility and $180 million reduction in near-term debt maturities since year-end 2008, primarily reflecting prepayment of the 4.875% senior notes due in December 2010 through cash prepayments ($58 million) and the debt exchange ($122 million). Fitch anticipates free cash flow of approximately $200 million in 2009 compared with $92 million in 2008, excluding $42 million of dividends received from investments in cellular partners that are included in cash flow from investing. Pro forma for the debt exchange, Convergys' total debt is approximately $610 million, primarily consisting of: -- $70 million of 4.875% senior unsecured notes due on Dec. 15, 2009; -- $400 million revolving credit facility borrowings due on Oct. 20, 2011; -- $125 million of 5.75% junior subordinated convertible debentures due in October 2029. CONVERGYS CORP: S&P Assigns 'BB-' Rating on $125 Mil. Junior Notes ------------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its 'BB-' issue-level and '6' recovery ratings to Convergys Corp.'s $125 million of 5.75% junior subordinated convertible debentures due 2029. The '6' recovery rating indicates expectations of negligible (0%-10%) recovery in the event of a payment default. The company issued the new debenture under a debt-for-debt exchange offer that it launched on Sept. 9, 2009. The company offered to the holders of its 4.875% senior unsecured notes that mature on Dec. 15, 2009, the option to exchange that bond for new 5.75% junior subordinated convertible debentures that mature on Sept. 15, 2029. Convergys capped the exchange offer at $122.5 million of the 4.875% senior notes, though $192.6 million was outstanding as of June 30, 2009. Pro forma for the exchange, $70 million of the 4.875% notes remain outstanding. S&P will withdraw the ratings on those notes when the bond matures in December 2009. S&P also affirmed the 'BB+' corporate credit rating on Cincinnati- based Convergys. The outlook on the company is negative. "We expect that Convergys will continue to experience operational challenges across all business segments over the intermediate term," said Standard & Poor's credit analyst Naveen Sarma. Besides resulting in little or no revenue growth, these challenges will continue to affect profitability. Consolidated operating margins, which were about 9.0% two years ago, have declined to 7.3% for the second quarter of 2009, excluding restructuring costs and one-time items. COOPER-STANDARD: Cooper Tire Allowed to Sue Applicant in U.S. ------------------------------------------------------------- The Ontario Superior Court of Justice issued an endorsement lifting the stay of proceedings in the insolvency case of Cooper- Standard Automotive Canada Ltd., allowing Cooper Tire Rubber Company to commence proceedings against CSA Canada in the U.S. Bankruptcy Proceedings. Cooper Tire asserts ownership of about $60 million in tax refunds, which CS Canada received from the Canada Revenue Agency, based on the terms of a stock purchase agreement between Cooper Tire and Cooper-Standard Holdings Inc. Under the agreement, Cooper Tire is reportedly entitled to all refunds of taxes and interest received by CS Holdings or any of its units including CSA Canada. Cooper Tire also wants to recover $42.5 million in additional Canadian tax refunds yet to be received. To recall, Cooper Tire sought permission from Judge Peter J. Walsh in the U.S. Bankruptcy Court for the District of Delaware to commence proceedings in Ontario to determine the issue of entitlement to the anticipated tax refunds and interest. However, that request was refused. Cooper Tire, hence, seeks to have the ultimate issue of the entitlement to the refunds and interest determined by the U.S. Bankruptcy Court by amending its present complaint against CSA and CSA Holdings in the U.S. Court to include CSA Canada. To do so requires that the stay of proceedings be lifted in the CCAA proceedings. CSA Canada, RSM Richter Inc. as Monitor, and the DIP Lender opposed the lift stay request. In a 7-page document dated September 29, 2009, the Canadian Court held that Cooper Tire would face "significant risk" because of CSA Canada's refusal to segregate future tax refunds it would receive pending adjudication of Cooper Tire's claims. The Canadian Court cited in particular an incident where CSA Canada used the tax refunds it received on July 27, 2009, for working capital, which contravened the terms of the Stock Purchase Agreement. "While CSA Canada is not a party to the agreement, it seems the handling of the July 27, 2009 refunds was in derogation of the obligation of [CS Holdings] under the agreement which had committed itself to remitting to Cooper Tire the tax refunds and interest," the Canadian Court said. "Cooper Tire is put to significant risk and possible prejudice if its claimed right to the refunds is not adjudicated upon expeditiously," the Canadian Court further said. The Canadian, therefore, ordered that all tax refunds and interest received by CSA Canada be segregated immediately upon receipt and not be disbursed or encumbered or otherwise dealt with in any way until further Court order. A full-text copy of the endorsement is available for free at: http://bankrupt.com/misc/CooperEndorsementSept29.pdf About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, 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. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. 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, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) COOPER-STANDARD: Cooper Tire Amends Suit to Include Canadian Unit ----------------------------------------------------------------- Cooper Tire & Rubber Company filed an amended complaint in the U.S. Bankruptcy Court for the District of Delaware, naming Cooper-Standard Automotive Canada Ltd., the Canadian unit of Cooper-Standard Holdings Inc., as one of the defendants. In December 2004, Cooper-Standard Holdings purchased for $1.2 billion in cash Cooper Tire's automotive division. Pursuant to the agreement, Cooper-Standard agreed to pay Cooper Tire for certain tax refunds on tax liabilities incurred prior to the sale. Cooper-Standard Automotive Canada Ltd., which filed an insolvency proceeding in Canada on August 4, 2009, and is owned and controlled by Cooper-Standard Holdings, received $60 million tax refunds from the Canada Revenue Agency on July 27, 2009, and will be receiving an additional $42.5 million from the agency. In its lawsuit, Cooper-Tire wants the tax refunds to CSA segregated and remitted to Cooper-Tire. Cooper Tire asserts ownership of the tax refunds based on a provision of a stock purchase agreement that was executed in connection with the transfer of its stock to Cooper-Standard Holdings. Cooper Tire asserts that it is entitled to all refunds of its taxes and interest received by CSA-Holdings or any of its affiliates prior to the disposition. Cooper-Tire has filed a motion seeking preliminary injunction, to compel the Debtors to place all tax refunds into an escrow account pending a ruling on its claims. The move to file an amended complaint came after the Ontario Superior Court of Justice, which oversees the insolvency case of CSA-Canada, issued an endorsement on September 29, 2009, lifting the stay in the Canadian unit's case. The Canadian Court's decision permits Cooper Tire to file legal actions against CSA Canada in the Chapter 11 cases of CS Holdings and its U.S.-based affiliates. Cooper Tire earlier urged the U.S. Bankruptcy Court to approve its motion for preliminary injunction that would compel CS Holdings and Cooper-Standard Automotive Inc. to put funds in an exclusive escrow account until a ruling is issued on the merit of its claims against the companies. Cooper Tire argued there is a strong probability that it would win the case, pointing out that the tax refunds are property of the company as provided by a stock purchase agreement with CS Holdings. CS Holdings and CS automotive, however, countered that Cooper Tire cannot obtain approval of its motion because the company failed to show that it has a likelihood of success on the merits of its claims. The defendants also said that there is no need for Cooper Tire's motion to be heard before the U.S. bankruptcy Court since CSA Canada has not received any additional tax refunds. Cooper Tire asserts ownership of about $60 million in tax refunds, which CS Canada received from the Canada Revenue Agency, based on the terms of a 2004 stock purchase agreement that was executed in connection with the transfer of its stock to CS Holdings. Under the agreement, Cooper Tire is reportedly entitled to all refunds of its taxes and interest received by CS Holdings or any of its units. Cooper Tire also wants to recover $42.5 million in additional Canadian tax refunds yet to be received. About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, 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. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. 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, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) COOPER-STANDARD: CS Automotive's Schedules of Assets & Debts ------------------------------------------------------------ A. Real Property Plant (El Dorado, Arkansas) $1,700,000 Plant (Surgoinsville, Tennessee) 1,467,827 Plant (Auburn, Indiana) 8,856,584 Office (Auburn, Indiana) 914,459 Plant & Offices (Auburn, Indiana) 2,869,027 Plants (Gaylord, Michigan) 1,629,159 Plants (Goldsboro, North Carolina) 3,516,502 Plant (Spartanburg, South Carolina) 1,565,332 Plants (Fairview, Michigan) 1,259,331 B. Personal Property B.1 Cash on hand 7,315 B.2 Bank Accounts 18,653,861 See http://bankrupt.com/misc/CSAutomotiveAccounts.pdf B.3 Security Deposits 201,709 B.4 Household goods 0 B.5 Collectibles 0 B.6 Wearing apparel 0 B.7 Jewelry 0 B.8 Firearms, other hobby equipment 0 B.9 Interests in Insurance Policies Undetermined B.10 Annuities 0 B.11 Interests in an education IRA 0 B.12 Interests in IRA, ERISA or other Pension Plans 0 B.13 Business Interests and stocks CS Automotive FHS Inc. 120,596,412 CS Automotive Brasil Sealing Ltda. 87,780,195 CSA International Holdings CV 81,674,112 Others 224,843,829 See http://bankrupt.com/misc/CSAutomotiveStock.pdf B.14 Interests in partnerships 13,145,750 B.15 Government and Corporate Bonds 0 B.16 Accounts Receivable Intercompany Note - CSA Canada Limited 148,844,198 Intercompany Balance - CS Automotive OH LLC 104,581,472 Others 228,335,762 See http://bankrupt.com/misc/CSAutomotiveReceivable.pdf B.17 Alimony, support 0 B.18 Other Liquidated Debts 298,249 B.19 Equitable or future interests, life estates 0 B.20 Contingent & noncontingent interests 0 B.21 Other contingent, unliquidated claims Undetermined B.22 Patents Undetermined See http://bankrupt.com/misc/CSAutomotivePatents.pdf B.23 Licenses 1,182,173 B.24 Customer Lists 0 B.25 Vehicles 0 B.26 Boats, motors, accessories 0 B.27 Aircraft and accessories 0 B.28 Office equipment, furnishings and supplies 7,687,478 B.29 Machinery 55,919,198 B.30 Inventory 26,698,612 B.31 Animals 0 B.32 Crop 0 B.33 Farming equipment & implements 0 B.34 Farm supplies 0 B.35 Other Personal Property 17,718,375 TOTAL SCHEDULED ASSETS $1,161,946,922 ======================================================== C. Property Claimed as Exempt Not Applicable D. Secured Claim Deutsche Bank Trust Company Americas $567,040,287 Others 67,310,216 E. Unsecured Priority Claims 0 F. Unsecured NonPriority Claims 1,394,016,731 See http://bankrupt.com/misc/CSAutomotive_schedf.pdf TOTAL SCHEDULED LIABILITIES $2,028,367,234 ======================================================== About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, 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. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. 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, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) COOPER-STANDARD: CS Automotive's Statement of Fin'l Affairs ----------------------------------------------------------- Allen Campbell, vice-president and chief financial officer of Cooper-Standard Holdings Inc., informed the U.S. Bankruptcy Court for the District of Delaware Southern District of New York that Cooper-Standard Automotive Inc. recorded income from the operation of its business within two years prior to the petition date: Period Amount ------ ------ Fiscal YTD 2009 $226,607,918 Fiscal 2008 $508,211,455 Fiscal 2007 $591,773,159 CS Automotive also generated $77,582,614 from other sources during the same period. Mr. Campbell disclosed that within 90 days before its bankruptcy filing, CS Automotive paid $ 135,840,252 to creditors. A list of the 90-day prepetition payments is available without charge at: http://bankrupt.com/misc/CSAPaymentCreditors_90days.pdf Within one year before its bankruptcy filing, CS Automotive made payments to insiders, a list of which is available without charge at http://bankrupt.com/misc/CSAPaymentInsiders.pdf CS Automotive also paid $5,816,994 to these firms related to debt counseling or bankruptcy within the same period: Firms Amount ----------- -------- Alvarez & Marsal $1,260,020 Davies Ward Phillips & Vineberg $250,000 Fried Frank Harris Shriver & Jacobson $3,203,300 Lazard Freres & Co LLC $838,673 Richard Layton & Finger $125,000 Sitrick and Company $140,000 Within one year before the petition date, CS Automotive made gifts and charitable contributions aggregating $81,269, which include: Person/Organizations Amount -------------------- ------ S.A.Y. Detroit $28,764 United Way $10,000 Focus Hope $10,000 United Way of Wayne County $5,000 March of Dimes $4,000 Otsego Club $3,200 United Way of the Piedmont $3,000 American Cancer Society $2,500 MDA $1,600 Mr. Campbell disclosed that the company lost $8,000 from fire incident at its facility in Gaylord, Michigan, in February 2009. CS Automotive and its affiliated debtors engage in asset sales of aged equipment or property of a de minimis nature from time to time, according to Mr. Campbell. He did not provide details but said that additional information about the transfers would be available upon request. CS Automotive is or was a party to 15 lawsuits within the year immediately before the petition date, a list of which can be accessed for free at http://bankrupt.com/misc/CSA_lawsuits.pdf From September 29, 2007, to June 6, 2009, the company conducted inventories supervised by these personnel: Dates Supervisor Amount of Inventory ---------- ------------ ------------------- 09/29/07 Duane Knueve $1,879,719 - Standard cost 10/27/07 Matthew Sterling $2,226,726 - Standard cost 10/27/07 Victor Guardado $2,120,991 - Standard cost 10/27/07 Victor Guardado $1,991,317 - Standard cost 10/28/07 Gary Cobb $4,207,128 - Standard cost 11/30/07 Jerry Karabinos $969,861 - Cost 11/30/07 Julie Knox $1,361,464 - Cost 11/30/07 Doug Carrier $771,224 - Standard cost 11/30/07 Jerry Karabinos $114,913 - Cost 12/01/07 Mark Cavanaugh/ Dave Schober $1,032,833 ? Cost 10/24/08 Lee/Barylski $8,323,644 - Standard cost 10/31/08 Lisa Wheeler $3,172,403 - Standard cost 10/31/08 Janice Kwapis $1,144,612 - Standard Cost 12/18/08 Nancy Garcia Rojas $768,460 - Standard cost 10/24/08 Lee/Barylski included in Auburn, Indiana ? Standard Cost 02/20/09 Blanca Suarez $1,996,688 - Cost 04/07/09 Nancy Garcia Rojas $859,341 - Standard cost 04/28/09 Janice Kwapis $1,539,362 - Standard Cost 04/30/09 Lisa Wheeler $3,016,841 - Standard cost 06/06/09 Blanca Suarez $1,963,189 ? Cost 03/13/09 Lee/Barylski $0.00 - included in Auburn, Indiana CS Automotive closed its two bank accounts with JP Morgan Chase, two with National City and one with RBS/ABN within the year prior to its bankruptcy. Mr. Campbell disclosed that within two years prior to CS Automotive's bankruptcy filing, these firms audited the company's books of account and records or prepared its financial statements: Firms Dates Services Rendered --------- ----------------------- Ernst & Young, LLP August 2007 to August 2009 FTI May 2009 to June 2009 Cooper-Standard Holdings Inc. has 100% stock ownership in CS Automotive, according to Mr. Campbell. About Cooper-Standard Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/ -- headquartered in Novi, Michigan, 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. Cooper-Standard is a privately held portfolio company of The Cypress Group and Goldman Sachs Capital Partners Funds. Cooper-Standard Holdings Inc., together with affiliates, filed for Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743). Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and Richards, Layton & Finger, P.A., will serve as bankruptcy counsel to the Debtors. Lazard Freres & Co. is serving as investment banker while Alvarez & Marsal is financial advisor. Kurtzman Carson Consultants LLC is notice, claims and solicitation agent. 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, 2009. The Company's Canadian subsidiary, Cooper-Standard Automotive Canada Limited, also sought relief under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Toronto, Ontario, Canada. Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA proceedings undertaken by Cooper-Standard Holdings Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) CORUS BANKSHARES: Starwood/TPG's $2.77-Bid Wins Assets Auction -------------------------------------------------------------- Nick Timiraos at The Wall Street Journal relates Barry Sternlicht's Starwood Capital Group, along with private-equity firm TPG, made the winning bid of about $2.77 billion for Corus Bankshares unit Corus Bank's condo assets, which have a face value of $5 billion. According to The Journal, the deal would be disclosed by the Federal Deposit Insurance Corp. soon, and will give Starwood Capital the Corus portfolio of 112 construction loans, more than two-thirds of which are in default or are in foreclosure. Citing Mr. Sternlicht, The Journal relates that the FDIC's offer of 0% financing means that "you can afford to hold these properties and sell them at the right pace in difficult markets". The FDIC is providing financing and taking a 60% equity stake in the Starwood partnership, The Journal says. Based in Chicago, Illinois, Corus Bankshares, Inc. (NASDAQ: CORS) is a bank holding company. Corus conducted its banking operations through its wholly-owned banking subsidiary Corus Bank, N.A. Effective September 14, 2009, the Company's principal place of business has relocated to 10 S. Riverside Plaza, Suite 1800, Chicago, IL 60606. At March 31, 2009, the Company's balance sheet showed total assets of $7,673,845,000 and total liabilities of $7,698,794,000, resulting in a stockholders' deficit of $24,949,000. Corus Bank was closed September 11 by regulators, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with MB Financial Bank, National Association, Chicago, Illinois, to assume all of the deposits of Corus Bank, N.A. As of June 30, 2009, Corus Bank had total assets of $7 billion and total deposits of roughly $7 billion. MB Financial Bank will pay the FDIC a premium of 0.2 percent to assume all of the deposits of Corus Bank. In addition to assuming all of the deposits of the failed bank, MB Financial Bank agreed to purchase roughly $3 billion of the assets, comprised mainly of cash and marketable securities. The FDIC will retain the remaining assets for later disposition. The FDIC plans to sell substantially all of the remaining assets of Corus Bank in a private placement transaction. CR NEVADA ASSOCIATES-AVE: Voluntary Chapter 11 Case Summary ----------------------------------------------------------- Debtor: CR Nevada Associates-Ave. K, LLC 2413 Avenue K Galena Park, TX 11111 Bankruptcy Case No.: 09-37615 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Wesley W. Steen Debtor's Counsel: James B. Jameson, Esq. Attorney at Law 3355 West Alabama, Suite 1160 Houston, TX 77098 Tel: (713) 807-1705 Fax: (713) 807-1710 Email: jbjameson@jamesonlaw.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Marc A. Cooke, president of the Company. CRYOPORT INC: Expects to Raise $8.8MM by Issuing Common Shares -------------------------------------------------------------- Cryoport Inc. filed with the Securities and Exchange Commission a preliminary prospectus in connection with its public offering of 2,040,816 units, consisting of an aggregate of 2,040,816 shares of common stock and warrants to purchase an additional 2,040,816 shares of common stock. Each unit consists of one share of common stock and a warrant to purchase one share of common stock at an exercise price of 110% of the public offering price of the units in this offering. The common stock and warrants are immediately separable and will be issued separately. The Company estimates that the net proceeds from the sale of the units being offered will be approximately $8.8 million, based on an assumed public offering price of $4.90 per unit, after deducting underwriting discounts and commissions and estimated offering expenses that the Company must pay. The Company intends to use those net proceeds primarily to build up inventory, for capital expenditures, including establishing selected global staging and refurbishing sites, and for working capital and general corporate purposes. The Company may also use the proceeds to finance the acquisition of complimentary businesses or services. The Company said it currently has no agreements or commitments for any specific acquisitions at this time. The Company's common stock is currently traded on the OTC Bulletin Board under the symbol CYRX. Prior to the effectiveness of the registration statement of which the prospectus is a part, the Company will effect a reverse stock split anticipated to be on a 10-to-1. On September 30, 2009, the last reported sale price for the common stock was $4.90 per share (giving effect to the anticipated 10-to-1 reverse split). The Company intends to apply for listing of the common stock and warrants on the Nasdaq Capital Market under the symbol "COLD" and "COLDW," respectively, which the Company expects to occur immediately prior to the date of the prospectus. No assurance can be given that the application will be approved. If the application is not approved, the Company will not complete the offering and the shares of common stock will continue to be traded on the OTC Bulletin Board. Rodman & Renshaw, LLC, serves as underwriter. About Cryoport Inc. Cryoport Inc. provides an innovative cold chain frozen shipping system dedicated to providing superior, affordable cryogenic shipping solutions that ensure the safety, status and temperature, of high value, temperature sensitive materials. Cryoport has developed a line of cost effective reusable cryogenic transport containers capable of transporting biological, environmental and other temperature sensitive materials at temperatures below zero degrees centigrade. These dry vapor shippers are the first significant alternative to using dry ice and achieve 10+ day holding times compared to 1-2 day holding times with dry ice. The Company has incurred recurring losses and negative cash flows from operations since inception and has a working capital deficit of $3,693,015 and a cash and cash equivalents balance of $249,758 at March 31, 2009. Management has estimated that cash on hand, including cash borrowed under convertible debentures issued in the first quarter of fiscal 2010, will be sufficient to allow the Company to continue its operations only into the third quarter of fiscal 2010. In its June 30, 2009 report, KMJ Corbin & Company LLP, the Company's outside auditors, said these matters raise substantial doubt about the Company's ability to continue as a going concern. As of March 31, 2009, the Company had $1,572,556 in total assets against $6,348,460 in total liabilities, resulting in $4,775,904 in stockholders' deficit. CRYOPORT INC: Restructures Obligations to Debenture Holders ----------------------------------------------------------- CryoPort, Inc., on September 17, 2009, entered into an Amendment to Debentures and Warrants, Agreement and Waiver with Enable Growth Partners LP, Enable Opportunity Partners LP, Pierce Diversified Strategy Master Fund LLC, Ena, and BridgePointe Master Find Ltd., who are the Holders the Company outstanding Original Issue Discount 8% Senior Secured Convertible Debentures dated September 27, 2007, and Original Issue Discount 8% Secured Convertible Debentures dated May 30, 2008, as such Debentures and Warrants have been amended to date. The effective date of the Amendment is September 1, 2009. The purpose of the Amendment was to restructure the Company's obligations under the outstanding Debentures to reduce the amount of the required monthly principal payment and temporarily defer the commencement of monthly principal payments -- which was scheduled to commence September 1, 2009 -- and ceases the continuing interest payments for a period time. A summary of the material terms of the Amendment: 1. The Company must obtain stockholder approval of an amendment to its Amended and Restated Articles of Incorporation to increase the number of authorized shares of its common stock to 250,000,000, and file the amendment with the Nevada Secretary of State, by December 31, 2009. If the Company fails to obtain stockholder approval and file the amendment by December 31, 2009, the Company will be in default under the Warrants which will trigger a Holder's option to cause the Company to redeem all or a portion of a given outstanding Warrant by paying to the Holder an amount equal to the greater of (i) the Black-Scholes value of the amount of the Warrant being redeemed as of the date the Holder delivers the required default notice and (ii) the highest Black-Scholes value of the amount of the Warrant to be redeemed from the date of the notice of redemption through the trading day that the redemption amount is paid to the Holder. Any unpaid redemption amount due to a Holder will bear interest at the rate of 18% per annum. 2. The principal amount of each outstanding debenture is increased as of September 1, 2009, by an amount equal to all accrued and unpaid interest as of such date, plus all interest that would have accrued on the principal amount (as increased as of September 1, 2009, to reflect the then accrued but unpaid interest) from September 1, 2009, to July 1, 2010 (the maturity date of the Debentures). The Company shall have no obligation under the Debentures to make further payments of interest, and interest will cease to accrue, during the period September 1, 2009, to July 1, 2010. 3. The conversion price of the Debentures was decreased from $0.51 per share to $0.45 per share. 4. The commencement of the Company's obligation to make monthly payments of principal is deferred from September 1, 2009, to January 1, 2010, at which time the Company will make monthly pro rata payments to the Holders in the aggregate amount of $200,000 with a balloon payment due on the maturity date of July 1, 2010. Prior to the Amendment, the Company was obligated to repay the entire outstanding principal amount of the debentures in 12 equal monthly payments commencing on August 1, 2009. 5. The Holders' existing right to maintain a fully diluted ownership equal to 31.5% has been increased by the Amendment to a fully diluted ownership of 34.5%. 6. The exercise price of the outstanding Warrants was decreased from $0.51 per share to $0.45 per share, which also resulted in a corresponding pro rata increase in the number of shares that may be purchased upon exercise of such Warrants as a result of the existing adjustment provision contained in each Warrant. 7. Additional covenants were added to the Debentures (replacing similar covenants which had terminated as of June 30, 2009) and shall remain in full force so long as any of the Debentures remain outstanding: a. The Company will maintain a total cash balance of no less than $100,000 at all times during the Covenant Period; b. The Company will have an average monthly operating cash burn of no more than $500,000 during the Covenant Period. Operating cash burn is defined by taking net income (or loss) and adding back all non-cash items, and excludes changes in assets, liabilities and financing activities; c. The Company will have a minimum current ratio of 0.5 to 1 at all times during the Covenant Period. This calculation is to be made by excluding the current portion of the convertible notes payable and accrued interest, and liability from derivative instruments from current liability for the current ratio; d. Accounts payable will not exceed $750,000 at any time during the Covenant Period; e. Accrued salaries will not exceed $350,000 at any time during the Covenant Period; and f. The Company will not make any revisions to the terms of the existing contractual agreements for the Notes Payable to Former Officer, Related Party Notes Payable and the Line of Credit; other than the previous amendment to the payment terms of a note payable to the Company's former CEO. The Company may not deliver a redemption notice with respect to the outstanding Debentures until such time as the closing price of the Company's common stock will have exceeded $0.70 (as adjusted for stock splits or similar transactions) for 10 consecutive trading days prior to the delivery of the redemption notice. About Cryoport Inc. Cryoport Inc. provides an innovative cold chain frozen shipping system dedicated to providing superior, affordable cryogenic shipping solutions that ensure the safety, status and temperature, of high value, temperature sensitive materials. Cryoport has developed a line of cost effective reusable cryogenic transport containers capable of transporting biological, environmental and other temperature sensitive materials at temperatures below zero degrees centigrade. These dry vapor shippers are the first significant alternative to using dry ice and achieve 10+ day holding times compared to 1-2 day holding times with dry ice. The Company has incurred recurring losses and negative cash flows from operations since inception and has a working capital deficit of $3,693,015 and a cash and cash equivalents balance of $249,758 at March 31, 2009. Management has estimated that cash on hand, including cash borrowed under convertible debentures issued in the first quarter of fiscal 2010, will be sufficient to allow the Company to continue its operations only into the third quarter of fiscal 2010. In its June 30, 2009 report, KMJ Corbin & Company LLP, the Company's outside auditors, said these matters raise substantial doubt about the Company's ability to continue as a going concern. As of March 31, 2009, the Company had $1,572,556 in total assets against $6,348,460 in total liabilities, resulting in $4,775,904 in stockholders' deficit. CYNERGY DATA: Lenders Balk At $21M Transfer to Harris ----------------------------------------------------- Law360 reports that a group of lenders to bankrupt credit card processor Cynergy Data LLC has objected to $21 million in cure payments the company is proposing to transfer to Harris Bank N.A., claiming the Debtor is taking sides between creditors and the bank. Launched in 1995, Cynergy Data is a merchant credit card processing service provider that gives business owners excellent customer support and unparalleled merchant services. The company emphasizes honest, service-oriented business practices and customer-friendly products and services. During the past 14 years, Cynergy Data has rapidly expanded from a two-person operation to one that employs over 130 service-oriented team members. Headquartered in New York City, Cynergy Data manages a portfolio of nearly 80,000 merchants processing in excess of $10 billion annually. The Company and two affiliates -- Cynergy Data Holdings, LLC, and Cynergy Prosperity Plus, LLC -- filed for Chapter 11 on September 1, 2009 (Bankr. D. Del. Case No. 09-13038). The Company's legal advisor is Nixon Peabody LLP; its financial and restructuring advisor is CM&D Management Services LLC; its industry expert is Unicorn Partners, LLC; and its investment bankers are Stifel, Nicolaus & Company and Peter J. Solomon Company. Aside from Nixon peabody, Pepper Hamilton LLP has been hired as bankruptcy and restructuring counsel. Charles D. Moore of Conway MacKenzie, Inc., serves as chief restructuring officer. Kurtzman Carson & Consultants LLC serves as claims and notice agent. Cynergy Data said that it had assets of $109,546,132 against debts of $186,183,032 as of June 30, 2009. Cynergy Data filed for Chapter 11 to complete the sale of all of its assets to Cynergy Holdings, LLC, an affiliate of The ComVest Group, which will serve as stalking horse bidder in an auction. DAN KOOSH: Case Summary & 10 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Dan Koosh 3470 Ranchita Canyon Road San Miguel, CA 93451 Bankruptcy Case No.: 09-14126 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Central District of California (Santa Barbara) Judge: Robin Riblet Debtor's Counsel: Peter Susi, Esq. 7 W Figueroa 2nd Fl Santa Barbara, CA 93101-3191 Tel: (805) 965-1011 Fax: (805) 965-7351 Email: cheryl@msmlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of Mr. Koosh's petition, including a list of his 10 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cacb09-14126.pdf The petition was signed by Mr. Koosh. DANA HOLDING: Achieves Full Compliance with NYSE Listing Standards ------------------------------------------------------------------ Dana Holding Corporation has received notice from the New York Stock Exchange informing the company that it has achieved full compliance with all NYSE quantitative listing standards. In December 2008, Dana received a letter of non-compliance from the NYSE notifying the company that it had fallen below both the minimum share price and market capitalization requirements for continued listing on the exchange. On May 29, 2009, Dana satisfied the minimum share price requirement of maintaining a 30-day average share price of greater than $1.00 and had a closing price of at least $1.00 on that date, which was the last trading day of the calendar month. Compliance for the market capitalization standard, and restoration of full compliance with NYSE listing standards, required that Dana maintain an average market capitalization of greater than $100 million for two consecutive quarterly review periods. The company has exceeded this requirement since May 2009. The company recently completed a successful public offering of common stock that raised approximately $250 million. Based in Toledo, Ohio, Dana Holding Corporation -- http://www.dana.com/-- designs and manufactures products for every major vehicle producer in the world, and supplies drivetrain, chassis, structural, and engine technologies to those companies. Dana employs 46,000 people in 28 countries. Dana is focused on being an essential partner to automotive, commercial, and off-highway vehicle customers, which collectively produce more than 60 million vehicles annually. Dana has facilities in China in the Asia-Pacific, Argentina in the Latin-American regions and Italy in Europe. Dana Corp., together with affiliates, affiliates filed for Chapter 11 protection on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06- 10354). Attorneys at Jones Day represented the Debtors. It emerged from bankruptcy Jan. 31, 2008, and the reorganized entity was named Dana Holding Corporation. As reported in the Troubled Company Reporter on June 9, 2009, Moody's Investors Service lowered the Corporate Family Rating of Dana Holding Corporation to 'Caa2', raised the Probability of Default Rating to 'Caa1', and adjusted the ratings of certain debt instruments. According to Moody's, the positioning of Dana's PDR at 'Caa1' reflects ongoing pressures the company faces from the continued erosion in the global automotive and commercial vehicle markets. DANA HOLDING: Goldman Sachs Picks Option to Purchase Shares ----------------------------------------------------------- Dana Holding Corporation on October 6, 2009, said Goldman, Sachs & Co., as representative of the underwriters in Dana's recent common stock offering, has exercised the option to purchase 5,083,100 additional shares of Dana common stock. The sale of the option shares closed October 6 and the net proceeds to Dana are approximately $32.6 million. In connection with Dana's common stock offering, which closed on September 29, the underwriters were granted a customary 30-day option to purchase up to 5,100,000 additional shares of common stock. "We are pleased that we have the opportunity to raise additional funds," said Dana CEO Jim Sweetnam. "We believe these additional proceeds will help provide continued flexibility for future growth and restructuring of operations." Copies of the prospectus supplement and accompanying base prospectus related to the offering may be obtained from Goldman, Sachs, & Co. via telephone at: (866) 471-2526; via facsimile at: (212) 902-9316; via e-mail at: prospectus-ny@ny.email.gs.com; or via standard mail at Goldman, Sachs, & Co., Prospectus Department, 85 Broad Street, New York, N.Y. 10004. Based in Toledo, Ohio, Dana Holding Corporation -- http://www.dana.com/-- designs and manufactures products for every major vehicle producer in the world, and supplies drivetrain, chassis, structural, and engine technologies to those companies. Dana employs 46,000 people in 28 countries. Dana is focused on being an essential partner to automotive, commercial, and off-highway vehicle customers, which collectively produce more than 60 million vehicles annually. Dana has facilities in China in the Asia-Pacific, Argentina in the Latin-American regions and Italy in Europe. Dana Corp., together with affiliates, affiliates filed for Chapter 11 protection on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06- 10354). Attorneys at Jones Day represented the Debtors. It emerged from bankruptcy Jan. 31, 2008, and the reorganized entity was named Dana Holding Corporation. As reported in the Troubled Company Reporter on June 9, 2009, Moody's Investors Service lowered the Corporate Family Rating of Dana Holding Corporation to 'Caa2', raised the Probability of Default Rating to 'Caa1', and adjusted the ratings of certain debt instruments. According to Moody's, the positioning of Dana's PDR at 'Caa1' reflects ongoing pressures the company faces from the continued erosion in the global automotive and commercial vehicle markets. DANIEL FLORES: Voluntary Chapter 11 Case Summary ------------------------------------------------ Joint Debtors: Daniel R. Flores Abelina Herrera Flores 54-353 Avenida Vallejo La Quinta, CA 92253 Bankruptcy Case No.: 09-33642 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court Central District of California (Riverside) Judge: Sheri Bluebond Debtors' Counsel: Leonard J. Cravens, Esq. POB 2714 Indio, CA 92202-2714 Tel: (760) 342-1810 Email: cravenslaw@dslextreme.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. DEL FRISCO: S&P Changes Outlook to Stable, Affirms 'B-' Rating -------------------------------------------------------------- Standard & Poor's Ratings Services has affirmed its 'B-' corporate credit rating on Southlake, Texas-based Del Frisco's Restaurant Group LLC and revised the outlook to stable from negative. The outlook revision comes after the company executed an amendment that among other things reset financial covenants for the life of the loan. Based on that amendment, S&P believes the company can remain covenant-compliant in the near term, and thus maintain adequate liquidity. The company likely will generate positive free cash flows going forward. The amendment also set restrictions on capital spending, increased the interest rate margin and tightened the excess cash flow sweep. S&P expects that the lower capital spending will more than offset the increased interest costs and allow the company to reduce debt and have adequate cash balances. "The ratings on Del Frisco's reflect its highly leveraged capital structure and the significant challenges it will face as an operator of high-end steakhouse restaurants given the weak consumer and business spending trends," said Standard & Poor's credit analyst Charles Pinson-Rose. The company has faced acute sales pressure over the past year as consumer and business spending are down dramatically. Year to date, same-store sales have been down double digits at both of the company's concepts, Del Frisco's and Sullivan's. Overall margins have been strained as the company has deleveraged administrative, labor, occupancy, and utility costs as a result of the sales declines. This has been somewhat offset by lower food costs, but overall operating margins and company-wide profitability are down in each of the last three quarters, despite restaurant growth last year. S&P expects Del Frisco's to have weak same-store sales for the balance of the year. This may moderate in the fourth quarter, given the decline in the quarter last year, but will still be significant. In 2010, S&P still expects same-store sales to be pressured, but to decelerate considerably and likely be down in the low single digits for at least the first part of the year. S&P expects Del Frisco's to reduce debt through free cash flows next year. Credit metrics may deteriorate in the next two or three quarters, but may stabilize beyond that point. DELAMORE ELIZABETH: Files Chapter 11 in Dayton, Ohio ---------------------------------------------------- Delamore Elizabeth Place LP filed a Chapter 11 petition in Dayton Ohio. It filed for Chapter 11 on Sept. 30 (Bankr. S.D. Ohio Case No. 09-36187). The petition says assets are less than $50 million while debts exceed $50 million. Delamore Elizabeth is the owner of the Elizabeth Place medical and office building in Dayton, Ohio. The project is a development by the Delamore Cos. Delamore's Web site says it acquired over one million square feet of commercial space in the first half of 2007, which means they bought at the top of the market. DELPHI CORP: Businesses Split Into 3 After Emergence ---------------------------------------------------- To recall, on October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Under the Master Disposition Agreement, GM effectuated purchase of Delphi's global steering business and certain United Auto Workers under GM's control, including facilities located in Grand Rapids, Michigan; Rochester, New York; Kokomo, Indiana; and Lockport, New York. For its part, DIP Holdco 3 took Delphi's U.S. and non-U.S. businesses going forward with $3.6 billion in emergence capital and capital commitments but without the labor- related legacy costs associated with the North American sites, which were acquired by GM Components. Upon consummation of the transactions under the Master Disposition Agreement, on October 6, 2009, a new private company known as Delphi Holdings LLP is created and owned by GM and the DIP Lenders. GM is renaming Delphi Global Steering Business as Nexteer Automotive upon acquisition. Robert Remener is to remain as president of the Steering Business. Delphi and its debtor affiliates will be known as DPH Holdings Corporation and affiliates. They will retain certain residual non-core and non-strategic assets and liabilities of the Old Delphi that will be divested over time. DPH Holdings will also be responsible for the administration of the Debtors' Chapter 11 cases. Delphi is exiting bankruptcy with fewer plants and workers. Delphi has downsized its operations in the United States throughout the bankruptcy process from more than 40 plants to only four plants, with the factory in Clinton, Mississippi, also set to close by December 31, 2009, the Free Press related. Similarly, Delphi's workforce in the U.S. has shrunk from 50,600 in 2005, to 14,000 as of June 2009, the Free Press disclosed. Overall, Delphi has trimmed its global workforce from 180,000 to 100,000 workers since 2005, the Financial Times related in a separate report. As previously reported, the Modified First Amended Joint Plan of Reorganization of Delphi and its affiliates was confirmed by Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York on July 30, 2009. The confirmed Delphi Modified Plan has been declared effective as of October 6, 2009. The Modified Plan was substantially consummated at a closing that occurred at the offices of Skadden, Arps, Slate, Meagher & Flom LLP in New York; provided however that all the transactions contemplated by the Master Disposition Agreement and related agreements to occur at the closing are effective for tax and accounting purposes as of 11:58 p.m., Eastern Time, on the closing date pursuant to the Master Disposition Agreement. Claims Discharge, Injunction, Plan Releases Due to the occurrence of the Effective Date, the Confirmation Order is deemed a judicial determination of the discharge of all Claims against and Interests in the Debtors. Moreover, the satisfaction, release, and discharge pursuant to the Modified Plan will act as an injunction against any Person commencing or continuing any action, employment of process, or act to collect, offset, or recover any Claim, Interest, or Cause of Action satisfied, released, or discharged under the Modified Plan. By accepting distributions pursuant to the Modified Plan, each Holder of an Allowed Claim will be deemed to have specifically consented to the injunctions set forth under the Modified Plan. As of the Effective Date, each Debtor is deemed to release and discharge all "Released Parties" for and from any and all claims or Causes of Action existing as of the Effective Date. The Reorganized Debtors, including Reorganized DPH Holdings, and any newly formed entities that will be continuing the Debtors' businesses after the Effective Date, will be bound, to the same extent the Debtors are bound, by the releases and discharges. Similarly, as of the Effective Date, each Person who has voted to accept the Modified Plan and each entity which holds a claim or interest in the Debtors will have irrevocably and forever released and discharged all "Released Parties" for and from any claim or Cause of Action existing as of the Effective. Establishment of Bar Dates Also reflected in Delphi's Notice of Effective Date is the establishment of an Administrative Bar Date, a Final Fee Applications Deadline, and a Substantial Contribution Bar Date. A. Administrative Claims Bar Date Requests for payment of an Administrative Claim must be filed with Kurtzman Carson Consultants, the Debtors' claims and notice agent, and served on counsel for the Debtors and the Creditors' Committee no later than November 5, 2009, or will be disallowed automatically without the need for any objection from the Debtors or Reorganized Debtors. Unless the Debtors or the Reorganized Debtors object to an Administrative Claim on or prior to May 4, 2010, the Administrative Claim will be deemed allowed in the amount requested. In the event the Debtors or the Reorganized Debtors object to an Administrative Claim, the Bankruptcy Court will determine the allowed amount of that Administrative Claim. B. Professional Claims and Final Fee Applications Deadline All final requests for payment of Professional Claims and requests for reimbursement of expenses of members of the Statutory Committees must be filed no later than December 31, 2009. After notice and a hearing pursuant to Court-approved procedures, the allowed amounts of the Professional Claims and expenses will be determined by the Bankruptcy Court. Pursuant to the Bankruptcy Court's prior orders, any requirement that Professionals comply with Sections 327 through 331 of the Bankruptcy Code in seeking retention or compensation for services rendered terminated on the Confirmation Date, and the Reorganized Debtors have employed and paid Professionals in the ordinary course of business. C. Substantial Contribution Bar Date Any Person who requests compensation or expense reimbursement for making a substantial contribution in the Debtors' Chapter 11 cases pursuant to Sections 503(b)(3), (4), and (5) of the Bankruptcy Code will file an application with the clerk of the Bankruptcy Court on or before November 20, 2009, and serve that application on counsel for the Debtors, the Creditors' Committee, the United States Trustee for the Southern District of New York, and other parties as may be decided by the Bankruptcy Court and the Bankruptcy Code on or before Nov. 20, 2009, or be forever barred from seeking compensation or expense reimbursement. Delphi's Bankruptcy Timeline Delphi's four-year bankruptcy stint has not been without hitches. The Company sought bankruptcy protection in October 2005 amidst the deterioration of its financial performance. At that time, Delphi was heavily burdened with legacy liabilities and was challenged with a poor automotive industry market. The Company filed its first Chapter 11 plan as it was approaching two years into bankruptcy in September 2007, as to which Plan the Court confirmed in January 2008. By April 2008, however, consummation of the Delphi Plan was halted when plan investors led by Appaloosa Management L.P. backed out of a $2.5 billion equity financing commitment under the Confirmed Plan. The parties are currently involved in a contested litigation in light of the failed financing deal. Delphi thus turned to its former parent, GM, for liquidity support. Delphi's problems were aggravated by a global economic crisis that threatened big companies, including GM, in 2008. Delphi also had its share of clashes with its labor unions. Eventually though, the Company was able to obtained Court authority to terminate retiree benefits, thereby eliminating more than $1 billion in liabilities. Finally, more than four months ago, on June 1, 2009, Delphi presented to the Bankruptcy Court modifications to the Confirmed Plan, embodying a Master Disposition Agreement the Company entered into with GM, GM Components, and Parnassus Holdings, LLC, an affiliate of Platinum Equity Capital Partners, L.P, that contemplates that sale of Delphi assets to GM and Parnassus. The DIP Lenders opposed the modifications and thus, the asset sale was subjected to bidding procedures. Delphi got a pure credit bid notice from JPMorgan Chase Bank, N.A., as administrative agent to the DIP Lenders. It also reached accord with the DIP Lenders, the Official Committee of Unsecured Creditors and the Pension Benefit Guaranty Corporation with respect to the Plan Modifications. In an auction held July 24, 2009, JPMorgan's Pure Credit Bid emerged as the successful bid. Subsequently, General Motors Company, as assignee of General Motors Corporation, GM Components and DIP Holdco 3 LLC entered into an amended Master Disposition Agreement for the purchase of Delphi's assets. The Modified Plan was further revised to reflect the July 2009 developments. Accordingly, the Court confirmed the revised Modified Plan on July 30, 2009. Professional bankruptcy fees under the Delphi cases since 2005 may be up to nearly $500 million, according to the Free Press. About Delphi Corp Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi technology is also found in computing, communications, consumer accessories, energy and medical applications. Delphi has approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELPHI CORP: Ace American Sues for Scope of Coverage for Claims --------------------------------------------------------------- ACE American Insurance Company and Pacific Employers Insurance Company filed a complaint against Delphi Corporation, the State of Michigan Workers' Compensation Insurance Agency, and the State of Michigan Funds Administration, seeking declaratory judgment on the scope of insurance coverage for workers' compensation claims under multi-state insurance policies. ACE issued nine Specific Excess Workers' Compensation and Employers Liability Policies, which contain a substantial self- insured retention, with excess insurance for the Underlying Self- Insured Michigan Workers' Compensation Claims. ACE or Pacific Employers also issued nine Workers' Compensation and Employers Liability Policies that are applicable to certain workers' compensation claims arising in Michigan against certain of the Debtors, but are not applicable to any of the Self-Insured Michigan Workers' Compensation Claims against Delphi. ACE relates that since 1999, workers' compensation claims asserted against Delphi in Michigan were defended, covered, and paid by Delphi as a self-insured employer and not by ACE or Pacific Employers under the Deductible Policies. Lawrence J. Kotler, Esq., at Duane Morris LLP, in New York, discloses that on July 15, 2009, the Director of the Agency sent a letter to ACE erroneously concluding that Delphi Automotive Systems Corporation and Delphi have been insured for all workers' compensation liability in Michigan with Pacific Employers and ACE. In August 2009, he points out, ACE and Pacific Employers began receiving notices of workers' compensation hearings for numerous Underlying Self-Insured Michigan Workers' Compensation Claims, which are not covered by the Deductible Policies, but are only covered by Delphi as an authorized self-insured employer. Against this backdrop, Mr. Kotler asserts that the Deductible Policies do not afford coverage for the Underlying Self-Insured Michigan Workers' Compensation Claims against Delphi. Rather, he explains, the Deductible Policies only provide insurance coverage for workers' compensation claims arising in Michigan against certain subsidiaries or divisions of Delphi that were not approved by the Agency as self-insured employers. He argues that the Deductible Policies do not provide insurance coverage for self-insured workers' compensation claims, including claims covered by the Retention Policies. He adds that the Retention Policies only provide that insurance coverage in excess of the Retention Policies' applicable self-insured retentions. "Thus, ACE and Pacific Employers have no insurance coverage obligations to Delphi with respect to the Underlying Self-Insured Michigan Workers' Compensation Claims under the Deductible Policies," Mr. Kotler maintains. In the event the Deductible Policies are determined to provide insurance coverage to Delphi for the Underlying Self-Insured Michigan Workers' Compensation Claims due to a scrivener or mutual mistake of ACE or Pacific Employers and Delphi, the Deductible Policies must be reformed to reflect the mutual understanding and intent of the parties, Mr. Kotler says. Thus, ACE and Pacific Employers ask the Court to declare that: (a) they owe no duty to defend Delphi under the Deductible Policies for the Underlying Self-Insured Michigan Workers' Compensation Claims; (b) ACE owes no duty to defend any insured under the Retention Policies for the Underlying Self-Insured Michigan Workers' Compensation Claims; (c) ACE owes no duty to provide insurance under the Retention Policies until the applicable retentions are exceeded; and (d) ACE and Pacific Employers are entitled to the fees and costs arising from their action, including reasonable attorney's fees. In the alternative, if the Deductible Policies as written are somehow determined to provide insurance coverage for the Underlying Self-Insured Michigan Workers' Compensation Claims, ACE and Pacific Employers ask the Court to enter an order reforming the Deductible Policies to reflect the mutual understanding, intent and agreement of the parties that the Deductible Policies do not afford coverage to Delphi for the Underlying Self-Insured Michigan Workers' Compensation Claims. About Delphi Corp Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi technology is also found in computing, communications, consumer accessories, energy and medical applications. Delphi has approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000). DELPHI CORP: Renames Steering Biz as Nexteer Automotive ------------------------------------------------------- Effective with the closing of the sale of Delphi's global steering business to GM Global Steering Holdings LLC, it was announced the new company will go to market under the Nexteer Automotive brand name and will be the only global Tier One automotive supplier exclusively focused on advanced steering and driveline technology. "We wanted a name with a dynamic look and feel that not only reflects our 100-year heritage of industry-leading innovation, hard work and quality products, but also signals the opportunities we see as a revitalized business with a great future," said Robert J. Remenar, president of the new company and former president of Delphi Steering. Remenar will continue as president of Nexteer Automotive following the anticipated launch next month. Already well established with a strong, diverse and global customer base, the new positioning reinforces Nexteer Automotive's transition to a stand-alone and separate entity as a GM subsidiary. Similar to any automotive supplier in the industry that serves multiple OEM customers, the appropriate technology, product, cost and pricing firewalls will continue to be implemented to ensure all Nexteer Automotive's customers are protected and supported while it is under GM ownership. "We believe a product strategy focused exclusively on Electric Power Steering, Hydraulic Power Steering, driveline and steer-by-wire will give us an edge on innovation as we place all of our resources behind bringing to market new technologies that are valued by our customers," said Remenar. Nexteer Automotive will begin life as a multi-billion dollar global steering and driveline business solely dedicated to electric and hydraulic steering systems, steering columns and driveline products for original equipment manufacturers. Nexteer Automotive's 6,200 employees will serve more than 60 customers in every major region of the world with 15 manufacturing plants, six engineering and 14 customer service centers strategically located in North and South America, Europe and Asia. The current Delphi Steering headquarters in Saginaw, Mich., remains global headquarters for Nexteer Automotive. Nexteer Automotive's customers include GM, Fiat, Ford, Toyota, Chrysler, and PSA Peugeot Citroen, as well as automakers in India, China and South America. Over the course of the last century, Nexteer Automotive's industry-leading engineering and product development capabilities have consistently pioneered new steering technologies that have enhanced safety, fuel efficiency, comfort and convenience. This includes hydraulic assisted steering, tilt wheel steering columns including power tilt, active and energy absorbing columns, front- wheel drive and rear-wheel drive halfshafts, the premium performance TriGlide halfshaft joint, Electric Power Steering, Quadrasteer(TM) active vehicle dynamic control, and steer-by- wire. For more information on Nexteer Automotive, please visit: http://www.nexteer.com/ About Delphi Corp Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi technology is also found in computing, communications, consumer accessories, energy and medical applications. Delphi has approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DELPHI CORP: 2nd Amendment to ERISA Settlement Has Interim Nod -------------------------------------------------------------- Bernstein Litowitz Berger & Grossmann, LLP; Grant & Eisenhofer P.A.; Nix, Patterson & Roach, L.L.P. and Barroway Topaz Kessler Meltzer & Check, LLP said that in connection with the Delphi Corporation Securities DERIVATIVE & "ERISA" Litigation, a proposed second modification to the terms of the settlement with certain defendants Delphi Securities Action has been presented to, and tentatively approved by, the Court. The Second Modification amends the settlement terms set forth in the Stipulation and Agreement of Settlement With Certain Defendants dated August 31, 2007, as amended on January 11, 2008, which was approved by the Court on January 23, 2008 following a fairness hearing and notice to the Class. Unless stated otherwise, all terms capitalized herein are as defined in the Stipulation, as modified by the First Modification and the Second Modification. The proposed Second Modification accelerates the timing and assures the payment of the Class's recovery but decreases the consideration received by the Class. The salient terms of the proposed modifications are: 1. The Settlement will become effective independent of the occurrence of the Bankruptcy Effective Date and/or the substantial consummation of any Delphi plan of reorganization, and thus, the $90.1 million in cash (plus interest), less Court-approved attorneys' fees and expenses, currently being held in escrow will be distributed pursuant to the terms of the Stipulation, as modified by the First Modification and the Second Modification, regardless of when or whether Delphi emerges from bankruptcy. 2. The Section 510(b) Claim granted to the Class pursuant to the Stipulation and the First Modification will remain allowed in the same aggregate face amount as set forth in the First Modification, but will not be guaranteed any particular treatment or classification in any plan of reorganization that ultimately may be consummated. Under the terms of Delphi's new plan of reorganization confirmed by the Bankruptcy Court in July 2009, the Section 510(b) Claim has no value. 3. The $15 million cash payment which Delphi originally agreed to cause to be paid by a third party in the First Modification will not be paid. The parties disagree on the amount of damages, if any, that could have been recovered if the Class prevailed on each claim at trial. As the Section 510(b) Claim has no value under the plan of reorganization confirmed in July 2009, the aggregate amount of the settlement consideration is no less than $90.1 million. Based upon the claims submitted by Class Members to date, Co-Lead Counsel estimate that the average payment to Class Members would be no less than $0.13 per share of Delphi common stock, after taking into consideration the relative average payment that would be paid to Authorized Claimants who purchased Delphi Notes during the Class Period. Co-Lead Counsel were previously awarded attorneys' fees of 18% of the Gross Settlement Fund and reimbursement of costs and expenses in the amount of $1.3 million. The average reduction to the recovery per share of Delphi common stock attributable to the Court-awarded attorneys' fees and expenses is approximately $0.02. Lead Plaintiffs and Co-Lead Counsel have determined that, based upon (i) the dramatic change in Delphi's circumstances since they entered into the First Modification, including the catastrophic downturn in the economy, and in the auto industry in particular, and (ii) the fact that the Bankruptcy Effective Date will not occur with respect to the plan of reorganization that was the subject of the Confirmation Order entered by the Bankruptcy Court in January 2008, it is in the best interest of the Class to allow the Settlement to become effective without regard to the occurrence of the Bankruptcy Effective Date and/or consummation of Delphi's plan of reorganization in the bankruptcy proceeding. A hearing will be held before the Honorable Gerald E. Rosen in the United States District Court for the Eastern District of Michigan, Southern Division, Theodore Levin U.S. Courthouse, 231 W. Lafayette Blvd., Detroit, Michigan 48226, in Courtroom 733, at 1:00 p.m., on November 16, 2009, to determine whether: (1) the Second Modification should be approved by the Court as fair, reasonable and adequate; (2) Judgment should be entered pursuant to the Second Modification; and (3) such other matters as the Court deems appropriate to rule upon. Plaintiffs may object to the proposed Second Modification or request exclusion from the Settlement, as modified by the First Modification and the Second Modification. Any objection or request for exclusion must be properly submitted by November 2, 2009. About Delphi Corp Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi technology is also found in computing, communications, consumer accessories, energy and medical applications. Delphi has approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. On October 6, 2009, Delphi Corp.'s Chapter 11 plan of reorganization became effective. A Master Disposition Agreement executed among Delphi Corporation, Motors Liquidation Company, General Motors Company, GM Components Holdings LLC, and DIP Holdco 3, LLC divides Delphi's business among three separate parties -- DPH Holdings LLC, GM Components, and DIP Holdco 3. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DENNIS WILLIAMS: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Dennis D. Williams 3806 Lamb Drive Marietta, GA 30064 Bankruptcy Case No.: 09-86563 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Patrick L. Flanagan, Esq. Suite 1, 4246 Peachtree St., NE Atlanta, GA 30319 Tel: (404) 890-7400 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $100,001 to $500,000 According to the schedules, the Company has assets of at least $1,550,000, and total debts of $123,717. A full-text copy of Mr. Williams' petition, including a list of his 4 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ganb09-86563.pdf The petition was signed by Mr. Williams. DEVELOPERS DIVERSIFIED: Fitch Affirms 'BB' Issuer Default Rating ---------------------------------------------------------------- Fitch Ratings has affirmed the credit ratings of Developers Diversified Realty Corporation: -- Issuer Default Rating at 'BB'; -- $1.325 billion unsecured revolving credit facilities at 'BB'; -- $1.6 billion unsecured medium-term notes at 'BB'; -- $536 million convertible unsecured notes at 'BB'; -- $555 million preferred stock at 'B+'. The Rating Outlook is Negative. The 'BB' IDR and senior unsecured debt ratings continue to reflect DDR's leverage and risk-adjusted capitalization, unencumbered asset coverage ratios, and challenging operating conditions for the portfolio, even as conditions in the capital markets and the broader economy have improved. DDR's leverage ratio, defined as net debt divided by recurring operating EBITDA, was 10.9 times for the trailing 12 months ended June 30, 2009, which Fitch believes is consistent with a 'BB' IDR. When adjusted for funds from operations in DDR's joint ventures and certain non-cash general and administrative expenses, leverage was 9.4x for TTM. In addition, Fitch believes that DDR has a modest level of risk-adjusted capitalization for the 'BB' rating category. However, Fitch anticipates that the company's leverage ratio will improve slightly as of Sept. 30, 2009 given the impact of the $60 million equity sale to the Otto family and the sale of $157 million of stock through the company's common equity program in August and September. As of June 30, 2009, the company's portfolio of 682 shopping centers and six business centers included 264 unencumbered consolidated operating properties, but the company's unencumbered asset coverage ratio of 167% remains close to a financial covenant under DDR's revolving credit agreement and is more consistent with a 'BB' IDR. Though equity raises and the recently executed cash tender offers have improved unencumbered asset coverage, Fitch anticipates DDR continuing to operate relatively close to its 160% covenant limit absent more significant deleveraging events. With respect to portfolio performance, following the pressure on the portfolio following tenant bankruptcies and subsequent store closings of Circuit City, Linens 'N Things, Goody's and Steve & Barry's, DDR's portfolio occupancies have stabilized, but Fitch believes that the company's earnings power remains challenged. For example, in the second quarter of 2009, the core portfolio leased percentage was 90.7%, consistent with the level at March 31, 2009, but base rental rates on new leases and renewals decreased 4.7% on a cash basis during the quarter. Given these market dynamics, for the TTM ended June 30, 2009, the company's fixed charge coverage ratio (defined as recurring EBITDA less capital expenditures less straight-line rents divided by cash interest expense, capitalized interest and preferred stock dividends) was 1.5x. However, after adjusting for certain non- cash general and administrative expenses and joint venture income, fixed charge coverage was 1.8x. Looking forward, Fitch's base case analysis assumes further pressure on same-store net operating income throughout the remainder of 2009 and into 2010, whereby fixed charge coverage remains above 1.5x. Fitch's stress case assumes pressure in 2009 beyond that which was experienced in the first half of 2009 and continuing declines in 2010. Under this scenario, which Fitch believes to be less likely, fixed charge coverage would fall below 1.5x. The ratings take into consideration other credit strengths and offsetting factors. For example, the company exhibits a broad tenant roster, deep joint venture platform, and diffuse geographical footprint. However, it continues to face future development funding needs and impairments on both consolidated and joint venture property holdings. Although DDR's liquidity position has improved since the second quarter of 2009, the Rating Outlook remains Negative. The company's recent 9.625% coupon rate $300 million par value unsecured note transaction that was priced at 99.72% to yield 9.75% (rated 'BB' by Fitch) demonstrates access to unsecured debt capital, but the company still has substantial amounts outstanding under its revolving credit facilities. In addition, though DDR has also recently raised equity, sold shopping center properties, reduced indebtedness through tender offers, and is exploring other capital market transactions including financings through the Federal Reserve's Term Asset Backed Securities Loan Facility, the company continues to have a liquidity shortfall assuming no additional asset sales, debt refinancings and capital raises. The two-notch differential between DDR's IDR and its preferred stock rating is consistent with Fitch's criteria for corporate entities with an IDR of 'BB'. Based on Fitch's criteria report, 'Equity Credit for Hybrids & Other Capital Securities,' available on Fitch's web site, the company's preferred stock is 75% equity- like and 25% debt-like since it is perpetual and has no covenants but has a cumulative deferral option. Net debt plus 25% of preferred stock to recurring operating EBITDA and debt plus 25% of preferred stock to undepreciated book capital were 11.1x and 59.3%, respectively, as of June 30, 2009. These factors may have a positive impact on DDR's ratings and/or Rating Outlook: -- A liquidity coverage ratio of over 1.0x, which would be driven by TALF transactions, additional equity or unsecured debt issuances, and/or asset sales (as of June 30, 2009 pro forma for recent capital markets transactions including the unsecured bond offering, asset sales, and equity issuances, Fitch estimates that the company's liquidity coverage ratio through Dec. 31, 2011 is 0.7x assuming no additional asset sales, debt refinancings and capital raises); -- Net debt to recurring operating EBITDA sustains below 10.0x (for the TTM ended June 30, 2009, leverage was 10.9x, but after certain non-cash adjustments, leverage was 9.4x). These factors may have a negative impact on DDR's ratings: -- Availability under the company's revolving credit facilities reverts to levels maintained earlier this year, when over 90% of the revolver was drawn; -- Fixed charge coverage sustains less than 1.5x, which is below Fitch's expectations. Developers Diversified Realty Corporation is a REIT headquartered in Cleveland, Ohio in the business of acquiring, developing, redeveloping, leasing and managing shopping centers and other retail properties such as power centers. As of June 30, 2009, DDR's 682-property portfolio was situated across 45 states as well as Puerto Rico and Brazil. EDGE PETROLEUM: Disclosure Statement Hearing on Nov. 10 ------------------------------------------------------- Edge Petroleum Corp. on November 10 will seek approval of the disclosure statement explaining the Chapter 11 plan of reorganization that it filed together with its Chapter 11 petition. The reorganization plan is built upon the sale of the Company's assets. The Chapter 11 plan and sale are supported by the holders of at least two-thirds of the $227.5 million debt under the secured credit agreement, according to Edge. The disclosure statement says the secured lenders are to receive almost all proceeds from the sale and Edge's cash. The lenders are to make a $350,000 "gift" to be shared by unsecured creditors. In addition, unsecured creditors can receive collections from preference suits. The "gift" and lawsuit collections may be used also to pay expenses of the Chapter 11 case. Edge Petroleum has received the Bankruptcy Court's approval to auction off its assets. It has signed a certain Purchase and Sale Agreement dated September 30, 2009 with PGP Gas Supply Pool No. 3, who will purchase the assets absent higher and better bids at the auction. Pursuant to the Purchase Agreement, the effective date for the sale of the Assets is June 30, 2009 and the purchase price for the Assets is $191.0 million subject to adjustment for, among other things, a downward adjustment related to certain changes in the NYMEX Strip Price over the five year period from January 1, 2010 through December 31, 2014. The Gas Pricing Downward Adjustment is capped at approximately $23.9 million. In addition, in certain events PGP will be entitled to a break-up fee in the amount of $6.0 million and an expense reimbursement of $500,000 in certain events if the contemplated transaction does not close or PGP is not the winning bidder in the auction. The Company notes that it currently has approximately $226.5 million of outstanding principal under its Credit Agreement which is substantially in excess of the proceeds expected to be received pursuant to the Purchase Agreement. About Edge Petroleum Edge Petroleum Corporation (Nasdaq:EPEX) (Nasdaq:EPEXP) is a Houston-based independent energy company that focuses its exploration, production and marketing activities in selected onshore basins of the United States. At June 30, 2009, the Company's balance sheet showed total assets of $264,030,000, total liabilities of $252,492,000 and stockholders' equity of $11,538,000. Edge Petroleum filed for Chapter 11 on October 2, 2009 (Bankr. S.D. Tex. Case No. 09-20644). The Company has retained Akin Gump Strauss Hauer and Feld as legal counsel, Jordan, Hyden, Womble, Culbreth & Holzer, P.C., as local counsel, and Parkman Whaling LLC as financial advisor. Kurtzman Carson Consultants LLC serves as claims and notice agent. EDGE PETROLEUM: Gets Approval on All "First-Day Motions" -------------------------------------------------------- Edge Petroleum Corporation has received the approval of all of its first-day motions by the United States Bankruptcy Court for the Southern District of Texas, Corpus Christi Division. Edge, which filed for Chapter 11 protection on October 1, 2009, submitted a number of motions requesting approvals and received, among other things, authorization to continue to pay pre-petition and post-petition claims of certain suppliers, lien holders, pump operators, and royalty owners. Edge also received authorization to pay employee wages and provide healthcare and related benefit plans on an interim basis. The Court also granted interim approval for Edge to maintain its cash management systems and for the use of its cash collateral. At the time of filing, Edge had in excess of $12 million in cash on hand. As it proceeds with its financial restructuring, the Company expects, based on current commodity prices, that its cash on hand and cash from operating activities will be adequate to fund its projected cash needs, including the payment of operating costs and expenses. In addition, the Court granted the Company's motion for authority to sell the stock of its subsidiaries, to establish bidding and auction procedures pursuant to Bankruptcy Code Sections 105, 363, 365 and 1123(b), designating its proposed purchaser as the "stalking horse bidder" and approving the related break-up fee and expense reimbursement. Edge intends to engage in an auction process with any and all interested parties and to request that the Bankruptcy Court approve the sale to the highest and best bid at the auction. "We are pleased that the Court has granted these approvals so quickly," said John W. Elias, Chief Executive Officer. "Gaining these approvals will allow us to continue to operate in the ordinary course as we proceed through our restructuring process as planned. In addition, the approval of the bidding procedures will allow us to begin the process of soliciting bids in connection with the Bankruptcy Court supervised auction that we intend to hold. We expect to work closely with all of our constituencies to facilitate a controlled and expeditious process in the Bankruptcy Court and to successfully implement our proposed plan of reorganization." About Edge Petroleum Edge Petroleum Corporation (Nasdaq:EPEX) (Nasdaq:EPEXP) is a Houston-based independent energy company that focuses its exploration, production and marketing activities in selected onshore basins of the United States. At June 30, 2009, the Company's balance sheet showed total assets of $264,030,000, total liabilities of $252,492,000 and stockholders' equity of $11,538,000. Edge Petroleum filed for Chapter 11 on October 2, 2009 (Bankr. S.D. Tex. Case No. 09-20644). The Company has retained Akin Gump Strauss Hauer and Feld as legal counsel, and Parkman Whaling LLC as financial advisor. Kurtzman Carson Consultants LLC serves as claims and notice agent. EDGE PETROLEUM: Case Summary & 30 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Edge Petroleum Corp. 1301 Travis, Suite 2000 Houston, Texas 77002 Bankruptcy Case No.: 09-20644 Debtor-affiliates filing subject to Chapter 11 petitions: Entity Case No. ------ -------- Edge Petroleum Exploration Co. 09-20643 Edge Petroleum Production Co. 09-20645 Edge Petroleum Operating Co., Inc. 09-20646 Miller Oil Co. 09-20647 Miller Exploration Co. 09-20648 Type of Business: The Debtors are independent energy companies engaged in exploration, development, acquisition and production of natural gas, liquids and crude oil with operations focused onshore in the United States, primarily along the Gulf Coast of Permian Basin of Texas and New Mexico. See http://www.edgepet.com Chapter 11 Petition Date: October 1, 2009 Court: Southern District of Texas Debtor's Counsel: Charles R. Gibbs, Esq. Sarah L. Schultz, Esq. Yewande Akinwolemiwa, Esq. Akin Gump Strauss Hauer & Feld LLP 1700 Pacific Avenue, Suite 4100 Dallas, TX 75201 Tel: (214) 969-2800 Fax: (214) 969-4343 http://www.akingump.com Local Counsel: Shelby A. Jordan, Esq. Nathaniel P. Holzer, Esq. Harlin C. Womble, Esq. Jordan, Hyden, Womble, Culbreth & Holzer, P.C. 500 North Shoreline Blvd., Suite 900 Corpus Christi, TX 78471 Tel: (361) 884-5678 Fax: (361) 888-5555 Claims Agent: Kurtzman Carson Consultants LLC 2335 Alaska Avenue El Segundo, CA 90245 Tel: (866) 967-1788 The Debtors' financial condition as of June 30, 2009: Total Assets: $264,030,000 Total Debts: $234,000,000 The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Chisos Ltd. trade debt $19,445 670 Dona Ana Road, SW Deming, NM 88030 Roland Gonzalez Contract trade debt $18,880 Gauging PO Box 117 Hebbornville, TX 78361 Murphy Energy Services LP trade debt $13,483 19167 FM 787 Saratoga, TX 77585 LXC Energy LLC trade debt $12,961 Mo-Vac Service Inc. trade debt $9,652 Coastal Flow Field Services trade debt $9,298 Inc. Multi-Chem trade debt $8,559 Great Guns Inc. trade debt $7,470 BTA Oil Producers trade debt $6,761 Jack Cowley Supply Co. trade debt $6,027 Champion Technologies Inc. trade debt $6,014 Dayton Lease Service trade debt $4,984 American Express Co. trade debt $4,947 Medina Electric trade debt $4,526 Interim Compensation Source trade debt $4,035 Inc. Stringer's Oilfield Services trade debt $2,825 Inc. Texas Energy Services LP trade debt $2,706 Pressure Services Inc. trade debt $2,470 Lone Star Industries trade debt $2,243 EFM Technical Services Inc. trade debt $1,894 PC Connection trade debt $1,746 De Lage Landen Financial trade debt $1,536 Services Advances Fabrication & trade debt $1,536 Measurement LLC Southern Flow Companies Inc. trade debt $1,372 D&J Trucks trade debt $1,343 Curtis Oilfield Services LLC trade debt $1,288 Warner Oil Company Distributor trade debt $1,090 Western Thunderhorse Vac trade debt $1,018 Truck Services Merril Corporation trade debt $877 M&R Oilfield trade debt $892 The petition was signed by John W. Elias, chairman, president and chief executive officer. EMPIRE RESORTS: Special Stockholders' Meeting on November 10 ------------------------------------------------------------ A special meeting of stockholders of Empire Resorts, Inc., will be held at the offices of Olshan Grundman Frome Rosenzweig & Wolosky LLP, located at Park Avenue Tower, 65 East 55th Street, New York, New York 10022, on November 10, 2009, at 10:00 a.m., local time, for these purposes: 1. To approve the issuance of 27,701,852 shares of the Company's common stock, par value $0.01 per share, to Kien Huat Realty III Limited, a corporation organized under the laws of the Isle of Man, for consideration of $44 million, pursuant to the Investment Agreement, dated August 19, 2009, by and between the Company and the Investor, as well as the issuance of any additional shares of Common Stock to the Investor as may be necessary pursuant to certain matching rights provided for under the Investment Agreement -- KHRL III Share Issuance Proposal -- consisting of these sub-proposals -- KHRL III Share Issuance Sub-Proposals: (A) To approve the KHRL III Share Issuance for the purposes of NASDAQ Marketplace Rule 5635(b) -- KHRL III Share Issuance Sub-Proposal (A); and (B) To approve the KHRL III Share Issuance for the purposes of NASDAQ Marketplace Rule 5635(d) -- KHRL III Share Issuance Sub-Proposal (B). 2. To approve an amendment to the Company's Certificate of Incorporation, as amended, to increase the Company's authorized capital stock from 80,000,000 shares, consisting of 75,000,000 shares of Common Stock and 5,000,000 shares of preferred stock, par value $0.01 per Share, to a total of 100,000,000 shares, consisting of 95,000,000 shares of Common Stock and 5,000,000 shares of Preferred Stock. 3. To approve an amendment of the Company's Amended and Restated 2005 Equity Incentive Plan to increase the number of shares of the Company's Common Stock subject to the 2005 Equity Incentive Plan by 2,000,000 shares to 10,500,000 shares -- 2005 Equity Plan Amendment. 4. To approve the grant to Au Fook Yew of an option to purchase 750,000 shares of Common Stock and the issuance of up to 250,000 shares of Common Stock to Mr. Au pursuant to certain matching rights provided for under the Investment Agreement -- Au Issuance Proposal -- consisting of these sub-proposals -- Au Issuance Sub-Proposals: (A) To approve the Au Issuance for the purposes of NASDAQ Marketplace Rules 5635(b) -- Au Issuance Sub-Proposal (A); (B) To approve the Au Issuance for the purposes of NASDAQ Marketplace Rules 5635(d) -- Au Issuance Sub-Proposal (B); and (C) To approve the Au Issuance for the purposes of NASDAQ Marketplace Rules 5635(c) -- Au Issuance Sub-Proposal (C). 5. To transact such other business as may properly be brought before the Special Meeting or any adjournment or postponement thereof. The board of directors of the Company has unanimously approved and declared advisable each of the KHRL III Share Issuance Sub- Proposals, the Certificate Amendment, the 2005 Equity Plan Amendment and each of the Au Issuance Sub-Proposals. Approval of the KHRL III Share Issuance Proposal is conditioned upon the approval of each of KHRL III Share Issuance Sub-Proposal (A) and KHRL III Share Issuance Sub-Proposal (B). If stockholder approval for either KHRL III Share Issuance Sub-Proposal is not obtained (even if approval of the other KHRL III Share Issuance Sub-Proposal is obtained), the KHRL Share Issuance Proposal will not pass. Likewise, approval of the Au Issuance Proposal is conditioned upon approval of each of Au Issuance Sub-Proposal (A), Au Issuance Sub-Proposal (B) and Au Issuance Sub-Proposal (C). If stockholder approval for any one of the Au Issuance Sub-Proposals is not obtained (even if approval of one or both of the other Au Issuance Sub-Proposals is obtained), the Au Issuance Proposal will not pass. The Board of Directors of the Company has fixed October 6, 2009 as the record date for the determination of stockholders entitled to notice of, and to vote at, the Special Meeting or any postponement or adjournment thereof. Accordingly, only stockholders of record at the close of business on the Record Date are entitled to notice of, and shall be entitled to vote at, the Special Meeting or any postponement or adjournment thereof. The notice and proxy statement are first being mailed to stockholders by October 9, 2009. A full-text copy of the proxy statement is available at no charge at http://ResearchArchives.com/t/s?4698 As reported by the Troubled Company Reporter, Empire Resorts on August 20, 2009, made the interest payment to the Bank of New York, as trustee, on the Company's 5-1/2%, senior convertible notes of $2.6 million that was due on July 31, 2009. The interest payment was made within the time period permitted pursuant to the indenture governing the Notes. On July 29, 2009, as reported by the TCR, The Park Avenue Bank delivered a notice to The Bank of New York advising that, as a result of the occurrence of the event of default under the loan agreement with The Park Avenue Bank, a standstill period has commenced under the intercreditor agreement with respect to the collateral. The standstill period will continue until the earlier to occur of (i) The Park Avenue Bank's express waiver or acknowledgement of the cure of the applicable event of default in writing or the occurrence of the discharge of the Loan Agreement secured obligations, and (ii) the date that is 90 days from the date of the Bank of New York's receipt of the standstill notice. About Empire Resorts Empire Resorts Inc. -- http://www.empiresorts.com/-- owns and operates the Monticello Casino & Raceway, including slot machines and a 230-acre harness racing facility in Sullivan County, 90 miles from midtown Manhattan. As of June 30, 2009, Empire Resorts had total assets of $45,791,000 against total debts of $81,489,000, resulting to total stockholders' deficit of $35,698,000. The $81,489,000 in liabilities, which include $65,000,000 owing to convertible notes, are all classified as "current liabilities". The Company had accumulated deficit of $105,375,000 as of June 30, 2009. ENERGY FUTURE: Has $4-Bil. 'Distressed Exchange' Offer ------------------------------------------------------ Energy Future Holdings Corp. announced October 5 that it and its direct, wholly owned subsidiary, Energy Future Intermediate Holding Company LLC, and EFIH's direct, wholly owned subsidiary, EFIH Finance Inc., are commencing exchange offers to exchange outstanding debt securities for up to $4.0 billion of new senior secured notes to be issued by EFH Corp. and/or EFIH and EFIH Finance, upon the terms and subject to the conditions set forth in the prospectus relating to the Exchange Offers and the related Consent and Letter of Transmittal. The purpose of the Exchange Offers is to reduce the outstanding principal amount and extend the weighted average maturity of the long-term debt of EFH Corp. and its subsidiaries. Concurrent with the Exchange Offers, and upon the terms and subject to the conditions more fully described in the Prospectus and the related Consent and Letter of Transmittal, EFH Corp. is soliciting consents from holders of Consent Notes to certain proposed amendments. If the requisite Consents with respect to the 2017 Notes Indenture are received, the Offerors will issue and exchange in the Exchange Offers up to $4.0 billion aggregate principal amount of 9.75% Senior Secured Notes due 2019 of EFH Corp. and/or 9.75% Senior Secured Notes due 2019 of the EFIH Offerors. If the requisite Consents with respect to the 2017 Notes Indenture are not received, the Offerors will issue and exchange in the Exchange Offers up to $3.0 billion aggregate principal amount of New Senior Secured Notes. The maximum principal amount of New Senior Secured Notes issuable in the Exchange Offers, in either case, is referred to herein as the "Maximum Exchange Amount." Consideration Per Outstanding $1,000 Principal Principal; ---------------- Issuer; Acceptance Prior to After Title of Priority Early Tender Early CUSIP/ISIN Old Notes Level Date Tender Date ---------- ----------- --------- ---- ----------- 873168 AL2 / $1 billion 1 $710 $680 US873168 AL29 EFH Corp 5.55% Series P Senior Notes due 2014 873168 AN8 / $750 million 1 $475 $445 US873168 AN84 EFH Corp. 6.50% Series Q Senior Notes due 2024 873168 AM0 / US873168 AM02 873168 AQ1 / $750 million 1 $465 $435 US873168 AQ16 EFH Corp. 6.55% Series R Senior Notes Due 2034 292680 AD7 / $2.65 billion 1 $660 $630 US292680 AD70 EFH Corp. Senior Toggle Notes 11.250%/12.000% due 2017 292680 AC9 / $2 billion 1 $745 $715 US292680 AC97 EFH Corp. 10.875% Senior Notes due 2017 292680 AA3 / US292680 AA32 882330 AF0 / $3 billion 2 $720 $690 US882330 AF05 TCEH LLC & TCEH Finance Inc. 10.25% Senior Notes due 2015 U88235 AC7 / USU88235 AC76 882330 AG8 / $2 billion 2 $720 $690 US882330AG87 TCEH & TCEH Finance 10.25% Senior Notes due 2015, Series B 882330 AC7 / US882330 AC73 Upon the terms and subject to the conditions of the Exchange Offers, including the acceptance priority levels described herein, the Maximum Exchange Amount and the Priority Level 2 Cap and the possible prorations resulting therefrom, in exchange for each $1,000 principal amount of Old Notes validly tendered (and not validly withdrawn), the participating holders of Old Notes will be eligible to receive the applicable consideration provided in the table above. The applicable consideration will be payable 45% in New EFH Senior Secured Notes and 55% in New EFIH Senior Secured Notes unless the requisite Consents with respect to each of the Legacy Notes Indentures are received, in which case, the applicable consideration will be payable entirely in New EFH Senior Secured Notes. The Offerors will not accept any tender of Old Notes that would result in the issuance of less than $2,000 principal amount of New EFH Senior Secured Notes or New EFIH Senior Secured Notes to a participating holder. Furthermore, the aggregate principal amount of New EFH Senior Secured Notes or New EFIH Senior Secured Notes issued to each participating holder for all Old Notes validly tendered (and not validly withdrawn) will be rounded down, if necessary, to $2,000 or the nearest whole multiple of $1,000 in excess thereof. The rounded amount will be the principal amount of New Senior Secured Notes a participating holder will receive, and no additional cash will be paid in lieu of any principal amount of New Senior Secured Notes not received as a result of such rounding down. 1. Terms of the Consent Solicitations a. The Consent Notes EFH Corp. is soliciting Consents with respect to: -- the Indenture, dated as of November 1, 2004, by and between EFH Corp. and The Bank of New York Mellon, as trustee, pursuant to which the 5.55% Series P Senior Notes due 2014 were issued; -- the Indenture, dated as of November 1, 2004, by and between EFH Corp. and BONYM, as trustee, pursuant to which the 6.50% Series Q Senior Notes due 2024 were issued; -- the Indenture, dated as of November 1, 2004, by and between EFH Corp. and BONYM, as trustee, pursuant to which the 6.55% Series R Senior Notes due 2034 were issued; and -- the Indenture, dated as of October 31, 2007, by and among EFH Corp., the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee, pursuant to which the 10.875% Senior Notes due 2017 and the 11.250%/12.000% Senior Toggle Notes due 2017 were issued, as amended and supplemented by the first and second supplemental indentures thereto. In this press release, the Legacy Notes and the 2017 Notes are collectively referred to as the "Consent Notes," and the Legacy Notes Indentures and the 2017 Notes Indenture are collectively referred to as the "Consent Notes Indentures." Consent Notes validly tendered pursuant to the Exchange Offers (and not validly withdrawn) at or prior to the Consent Date (as defined below) will be deemed to include Consents to the Proposed Amendments. Holders may not validly tender Consent Notes in the Exchange Offers at or prior to the Consent Date without delivering the related Consents in the Consent Solicitations, but holders may tender Consent Notes after the Consent Date and at or prior to the Expiration Date without delivering Consents with respect to such Consent Notes. Holders tendering Consent Notes after the Early Tender Date will not be eligible to receive the applicable Total Consideration for such Consent Notes. Likewise, holders of Consent Notes may not deliver Consents in the Consent Solicitations without validly tendering their Consent Notes in the Exchange Offers at or prior to the Consent Date and may only validly revoke Consents by validly withdrawing the previously tendered related Consent Notes at or prior to the later of the Consent Date and the execution of the supplemental indentures as to which such Consents relate. b. Proposed Amendments; Waiver The Proposed Amendments would eliminate substantially all of the restrictive covenants and references thereto contained in the Consent Notes Indentures and the Consent Notes, eliminate certain events of default, modify covenants regarding mergers and consolidations, and modify or eliminate certain other provisions, including the limitation on the incurrence of secured indebtedness in the Legacy Notes Indentures and the limitation on the incurrence of indebtedness and liens in the 2017 Notes Indenture, such that an unlimited amount of secured debt could be issued by EFH Corp. under the terms of the Consent Notes Indentures, and certain provisions relating to defeasance contained in the 2017 Notes Indenture and the 2017 Notes which would otherwise prevent a defeasance without, among other things, delivery of an opinion of counsel confirming such defeasance does not constitute a taxable event. In addition to the foregoing, execution and delivery of the Consent and Letter of Transmittal will constitute an express waiver by a consenting holder of the Consent Notes with respect to all claims against the Offerors and certain affiliates of the Offerors of any breach, default or event of default that may have arisen under the Consent Notes Indentures. c. Requisite Consents In order to be adopted with respect to a particular issue of Consent Notes, the applicable Proposed Amendments must be consented to by the holders of at least a majority of the outstanding aggregate principal amount of such issue of Consent Notes, each voting as a separate class. However, the holders of both series of the 2017 Notes will vote together as a single class, and, as a result, the Proposed Amendments to the 2017 Notes Indenture must be consented to by the holders of at least a majority of the outstanding aggregate principal amount of both series of the 2017 Notes, voting together as a single class. EFH Corp. will pay cash consideration for Consents. d. Consent Date To deliver Consents pursuant to the Consent Solicitations, holders must validly tender (and not validly withdraw) their Consent Notes, and thereby deliver Consents related to such Consent Notes, at or prior to 5:00 p.m., New York City time, on October 19, 2009. If the requisite Consents with respect to an issue of the Consent Notes are received and a supplemental indenture for such Consent Notes is executed, EFH Corp. will pay to each holder that validly delivers and does not validly revoke Consents in respect of such Consent Notes, in addition to any applicable consideration payable to such holder pursuant to the Exchange Offers, a cash consent payment of $2.50 per $1,000 principal amount of such Consent Notes. Consent payments are not subject to proration. EFH Corp.'s obligation to make consent payments is not conditioned upon consummation of the Exchange Offers. However, the Proposed Amendments in any executed supplemental indenture relating to the Consent Notes that were the subject of a terminated exchange offer will not become operative with respect to such issue of Consent Notes. 2. Terms of the Exchange Offers a. Maximum Exchange Amount and Priority Level 2 Cap The maximum aggregate principal amount of New Senior Secured Notes issuable in the Exchange Offers will not exceed $4.0 billion; provided that if the requisite Consents with respect to the 2017 Notes Indenture are not received, the maximum aggregate principal amount of New Senior Secured Notes issuable in the Exchange Offers will not exceed $3.0 billion. In addition, the aggregate principal amount of New Senior Secured Notes issuable in the Exchange Offers for the Priority 2 Notes (as defined below) will not exceed $1.5 billion. Subject to applicable law, the Offerors reserve the right, but are not obligated, to increase or decrease the Maximum Exchange Amount and/or the Priority Level 2 Cap. The terms of the Exchange Offers are described more fully in the Prospectus and the related Consent and Letter of Transmittal. b. Acceptance Priority Subject to the terms and conditions of the Exchange Offers described in the Prospectus, including the Maximum Exchange Amount and the Priority Level 2 Cap, Old Notes validly tendered at or prior to the Early Tender Date will have no priority in acceptance by the Offerors over Old Notes validly tendered after the Early Tender Date and at or prior to the Expiration Date (as defined below) other than pursuant to the following acceptance priority levels: -- First, all validly tendered (and not validly withdrawn) Old Notes designated in the table above as having an Acceptance Priority Level of 1 will be accepted unless doing so would cause the Maximum Exchange Amount to be exceeded, in which case such Priority 1 Notes will be accepted on a pro rata basis up to the greatest aggregate principal amount practicable that does not cause the Maximum Exchange Amount to be exceeded, and no Priority 2 Notes (as defined below) will be accepted for exchange; and -- Second, if the aggregate principal amount of Old Notes validly tendered (and not validly withdrawn) by holders of Priority 1 Notes would not cause the Maximum Exchange Amount to be exceeded, all validly tendered (and not validly withdrawn) Old Notes designated in the table above as having an Acceptance Priority Level of 2 will be accepted unless doing so, when taking into account the accepted Priority 1 Notes, would cause the Maximum Exchange Amount or the Priority Level 2 Cap to be exceeded, in which case such Priority 2 Notes will be accepted on a pro rata basis up to the greatest aggregate principal amount practicable that, together with the Priority 1 Notes accepted for exchange, does not cause the Maximum Exchange Amount or the Priority Level 2 Cap to be exceeded. The Offerors reserve the right to change the Acceptance Priority Levels in the event that the requisite Consents are not received or for other reasons, subject to applicable law. c. Early Tender Date Upon the terms and subject to the conditions of the Exchange Offers described in the Prospectus, including the Acceptance Priority Levels, the Maximum Exchange Amount and the Priority Level 2 Cap and the possible prorations resulting therefrom, (i) participating holders who tender their Old Notes at or prior to 5:00 p.m., New York City time, on October 19, 2009, and whose Old Notes are accepted by the Offerors in the Exchange Offers will be eligible to receive the applicable consideration set forth in the table above under the heading "Total Consideration if Tendered at or Prior to the Early Tender Date" in respect of each $1,000 principal amount of Old Notes tendered, and (ii) participating holders who validly tender their Old Notes after the Early Tender Date and at or prior to the Expiration Date and whose Old Notes are accepted by the Offerors in the Exchange Offers will be eligible to receive the applicable consideration set forth in the table above under the heading "Exchange Consideration if Tendered After the Early Tender Date and at or Prior to the Expiration Date" in respect of each $1,000 principal amount of Old Notes tendered. d. Expiration Date Each of the Exchange Offers will expire at 5:00 p.m., New York City time, on November 3, 2009. 3. Important Information Regarding the New Senior Secured Notes a. Accrued Interest The New Senior Secured Notes will accrue interest from and including the settlement date for the Exchange Offers. Holders who receive New Senior Secured Notes in exchange for Old Notes that pay cash interest will also receive, with respect to any such Old Cash-Pay Notes accepted for exchange, an amount equal to accrued and unpaid interest, if any, in cash, from the last applicable interest payment date to, but not including, the settlement date. Holders who receive New Senior Secured Notes in exchange for EFH Corp.'s 11.250%/12.000% Senior Toggle Notes due 2017 will also receive in the Exchange Offers, with respect to any such Old Toggle Notes accepted for exchange, in lieu of accrued and unpaid payment-in-kind interest with respect to such Old Toggle Notes, if any, from the last applicable interest payment date to, but not including, the settlement date, additional New Senior Secured Notes paid in accordance with the applicable consideration listed in the table above. b. Guarantees and Security The New EFH Senior Secured Notes will be guaranteed by Energy Future Competitive Holdings Company (a subsidiary of EFH Corp. and the parent of TCEH) on a senior unsecured basis and EFIH (the parent of Oncor Electric Delivery Holdings Company LLC ("Oncor Holdings")) on a senior secured basis. EFIH's guarantee of the New EFH Senior Secured Notes will be secured by EFIH's pledge of all of the membership interests in Oncor Holdings and the other investments it owns in Oncor Holdings and its subsidiaries on a senior basis. The New EFIH Senior Secured Notes will not be guaranteed. However, the New EFIH Senior Secured Notes will be secured by the Collateral on a senior basis. 4. Conditions to the Exchange Offers The Exchange Offers are not conditioned on any minimum principal amount of Old Notes being tendered or the issuance of a minimum principal amount of New Senior Secured Notes. However, the Exchange Offers are subject to certain other conditions, including the conditions (which conditions cannot be waived) that the Registration Statement, of which the Prospectus forms a part, has been declared effective by the Securities and Exchange Commission and that each series of the New Senior Secured Notes to be issued in the Exchange Offers are approved for listing on the New York Stock Exchange, subject to notice of issuance, each as more fully described in the Prospectus. Subject to applicable law, the Offerors have the right to amend, terminate or withdraw any of the Exchange Offers and the Consent Solicitations, including without limitation the acceptance priority levels, the Maximum Exchange Amount and/or the Priority Level 2 Cap, at any time and for any reason, including if any of the conditions described in the Prospectus are not satisfied. 5. Additional Information The Offerors filed a registration statement on Form S-4 relating to the Exchange Offers and the Consent Solicitations with the SEC on October 5, 2009. The Registration Statement has not yet become effective and the New Senior Secured Notes may not be issued, nor may the Exchange Offers be completed, until such time as the Registration Statement has been declared effective by the SEC and is not subject to a stop order or any proceedings for that purpose. Copies of the preliminary prospectus relating to the Exchange Offers and the Consent Solicitations, which is contained in the Registration Statement, and the related Consent and Letter of Transmittal will be made available to all holders of Old Notes free of charge and may be obtained from Global Bondholder Services Corporation, the Information Agent for the Exchange Offers, at (866) 387-1500 (U.S. toll free) or (212) 430-3774. Citigroup Global Markets Inc. and Goldman, Sachs & Co. are acting as the lead dealer managers in connection with the Exchange Offers and the lead solicitation agents in connection with the Consent Solicitations, and Banc of America Securities LLC, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities Inc., KKR Capital Markets LLC and Morgan Stanley & Co. Incorporated are also acting as dealer managers and solicitation agents, in each case, as described in the Prospectus. For additional information, you may contact Citigroup Global Markets Inc. at (800) 558-3745 (U.S. toll free) or (212) 723-6106 (collect) or Goldman, Sachs & Co. at (800) 828-3182 (U.S. toll free) or (212) 357-4692 (collect). The Prospectus and the related Consent and Letter of Transmittal will also be available free of charge at the SEC's website at http://www.sec.gov/ About Energy Future Energy Future Holdings Corp. is a diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The company delivers electricity to approximately three million delivery points in and around Dallas- Fort Worth. * * * Moody's Investors Service downgraded the probability of default rating for Energy Future to Ca from Caa1, downgraded the long-term debt ratings for selected securities of EFH and placed the ratings for selected securities of EFH's principal subsidiary, Texas Competitive Electric Holdings, on review for possible downgrade. Simultaneously, Moody's affirmed EFH's Caa1 corporate family rating and SGL-3 speculative grade liquidity rating. The rating outlook remains negative. The downgrade of the PDR and the long- term ratings for the selected securities reflect Moody's view that EFH's recent debt exchange offer is a distressed exchange. It also reflects Moody's belief that the exchange transaction has a high likelihood of closing. During the exchange offer process, the Ca PDR will prevail. ENRON CORP: Two Ex-Merrill Execs Set for Retrial in February ------------------------------------------------------------ Judge Ewing Werlein Jr., of the U.S. Bankruptcy Court for the Southern District of Texas ordered a retrial of two former Merrill Lynch & Co., executives, Daniel Bayly and Robert S. Furst beginning February 8, 2010. Messrs. Bayly and Furst, and a third executive, James A. Brown, were convicted in 2004 of conspiracy and wire fraud related to Enron's sham sale to Merrill Lynch of three power barges off the Nigerian coast in 1999. The deal, according to the Associated Press, was struck to make the earnings of Enron's energy division appear larger. Judge Werlein, however, encouraged prosecutors and defense attorneys to resolve the long-running case before it goes to re- trial, the AP added. According to the report, the 5th U.S. Circuit Court of Appeals in New Orleans threw out the convictions in 2006 after finding fault with the prosecution's legal theory known as "honest services." The court said the executives were doing what Enron wanted them to do and did not profit at its expense. As a result, the Circuit Court ruled, they did not deprive Enron of "honest services." About Enron Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01- 16033) following controversy over accounting procedures, which caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors filed their Chapter Plan and Disclosure Statement on July 11, 2003. On January 9, 2004, they filed their fifth Amended Plan and on the same day the Court approved the adequacy of the Disclosure Statement. On July 15, 2004, the Court confirmed the Debtors' Modified Fifth Amended Plan and that plan was declared effective on November 17, 2004. After the approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre-bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. (Enron Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ERIK BRIONES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Erik M. Briones 5371 Cody Road Rio Rancho, NM 87144 Bankruptcy Case No.: 09-14576 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court New Mexico (Albuquerque) Judge: Robert H. Jacobvitz Debtor's Counsel: Chris W. Pierce, Esq. Hunt & Davis, P.C. P.O. Box 30088 Albuquerque, NM 87190-0088 Tel: (505) 881-3191 Fax: (505) 881-4255 Email: cpierce@hrd-law.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $1,847,258, and total debts of $2,295,239. A full-text copy of Mr. Briones' petition, including a list of his 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/nmb09-14576.pdf The petition was signed by Mr. Briones. EXCO RESOURCES: S&P Raises Corporate Credit Rating to 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services raised the corporate credit rating on Dallas-based EXCO Resources Inc. to 'BB-' from 'B+'. The outlook is stable. At the same time, S&P raised the issue- level rating on EXCO's $450 million senior unsecured notes due 2011 from 'B-' to 'B' (two notches below the corporate credit rating of 'BB-') and removed the rating from CreditWatch, where it was placed with positive implications on June 30, 2009. S&P also revised the recovery rating on the senior unsecured notes to '6' from '5', indicating the expectation of negligible recovery (0% to 10%) in the event of a payment default. The upgrade on the corporate credit rating follows EXCO's recent announcement of two additional asset sales (one with EV Energy Partners L.P. and affiliates of EnerVest Ltd. for $145 million and the other with Sheridan Holding Co. I LLC for $540 million), which conclude a series of deleveraging transactions over the past few months. As a result of these new asset sales, which are set to close in November, EXCO has again materially reshaped and delevered its balance sheet, substantially improved its coverage measure, and strengthened its liquidity. S&P, however, continues to remain concerned about the company's acquisitive growth strategy which historically has been very aggressive. "The rating on EXCO reflects the company's historically acquisitive growth strategy; a midsize, predominantly natural gas reserve base; and the weak outlook for near-term natural gas prices," said Standard & Poor's credit analyst Patrick Lee. These weaknesses are partially offset by EXCO's promising growth prospects in the emerging Marcellus and Haynesville Shale; its reduced capital expenditures in the near term due to the BG Group joint venture announced earlier this year; its meaningful hedge protection in 2009 and 2010; good liquidity; and expectations of free cash flow over the intermediate term. The stable outlook is based on improved credit metrics and expectations of free cash flow generation in the intermediate term, partly due to meaningful hedge protection in the oil and natural gas markets for 2009 and 2010. S&P could revise the outlook to negative if EXCO were to revert to a more aggressive financial policy with regard to financing acquisitions or increased its adjusted debt to EBITDA above 3.5x. Although the company's reduced size, scope, and diversity of operations suggest limited prospects in the near term for a positive rating action, S&P could see a positive outlook if the company were to see increased reserve growth and production while maintaining a moderate financial policy over a sustained period of time. EXTENDED STAY: Opposes $1.03 Mil. Fees of McKenna Long ------------------------------------------------------ Extended Stay Inc. and its debtor affiliates oppose the payment of fees, aggregating $1,031,357, to McKenna Long & Aldridge and Latham & Watkins LLP. McKenna and Latham & Watkins were employed by TriMont Real Estate Advisors Inc. in connection with the Debtors' bankruptcy cases. TriMont is the special servicer of the Debtors' $4.1 billion mortgage loan. The Debtors' attorney, Jacqueline Marcus, Esq., at Weil Gotshal & Manges LLP, in New York, contends the aggregate fees of McKenna and Latham for July 2009 are more than twice the fees of the Debtors' attorneys and that there is "no apparent division of responsibility" between the two law firms. "The Debtors submit that the combined fees of McKenna and Latham are patently unreasonable and should not be reimbursed to the special servicer," Ms. Marcus says. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. For the year ending December 31, 2008, Extended Stay's audited financial statements show consolidated assets (including nondebtor affiliates) totaling approximately $7.1 billion and consolidated liabilities totaling approximately $7.6 billion. Consolidated revenues for the 12 months ending December 31, 2008 were approximately $1 billion. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EZ LUBE: Creditors Want to Probe Bruckmann for LBO Role ------------------------------------------------------- Law360 reports that creditors of EZ Lube LLC are seeking to examine the role that private equity firm Bruckmann Rosser Sherrill & Co. LLC played in a 2005 leveraged buyout that allegedly overloaded the company with secured debt. Headquartered in Santa Ana, California, EZ Lube LLC -- http://www.ezlube.com/-- provides oil change and related services for automobiles including: oil filter replacement, lubricating chassis, and gearbox and brake fluid level maintenance. On December 9, 2008, EZ Lube together with Xpress Lube-Tech, Inc., filed for Chapter 11 (Bankr. D. Del., Lead Case No. 08-13256). The company's attorneys are Curtis A. Hehn, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP. Broadway Advisors LLC has been tapped as financial advisor, and Coffey Management Company as chief restructuring advisor. Kurtzman Carson Consultants LLC acts as claims and notice agent. In its petition EZ Lube estimated assets and debts of $100 million to $500 million each. As reported in the December 10 issue of the Troubled Company Reporter, EZ Lube along with its affiliate, Xpress Lube-Tech Inc., filed for bankruptcy to facilitate a sale transaction with EZ Lube Acquisition Company LLC, an affiliate of its existing lenders, funds managed by GSO Capital Partners LP. However, the sale di not push through. FANNIE MAE: Preparing Program to Aid Mortgage Banks --------------------------------------------------- ABI reports that Fannie Mae and Freddie Mac are preparing to introduce a program aimed at helping independent mortgage banks acquire the short-term credit they need to make home loans. The Federal National Mortgage Association -- (FNMA) (NYSE: FNM) -- commonly known as Fannie Mae, is a shareholder-owned U.S. government-sponsored enterprise. Fannie Mae has a federal charter and operates in America's secondary mortgage market, providing mortgage bankers and other lenders funds to lend to home buyers at low rates. Fannie Mae was created in 1938, under President Franklin D. Roosevelt, at a time when millions of families could not become homeowners, or risked losing their homes, for lack of a consistent supply of mortgage funds across America. The government established Fannie Mae to expand the flow of mortgage funds in all communities, at all times, under all economic conditions, and to help lower the costs to buy a home. In 1968, Fannie Mae was re-chartered by the U.S. Congress as a shareholder-owned company, funded solely with private capital raised from investors on Wall Street and around the world. Fannie Mae is the U.S. largest mortgage buyer, according to The New York Times. As of March 31, 2009, Fannie Mae had $919,638,000,000 in total assets and $938,567,000,000 in total liabilities, resulting in Fannie Mae stockholders' deficit of $19,066,000,000. At March 31, 2009, Fannie Mae had $137,000,000 in non-controlling interest, resulting in total deficit of $18,929,000,000. Conservatorship As reported by the Troubled Company Reporter, the U.S. government took direct responsibility for Fannie Mae and Freddie Mac, placing the government-sponsored enterprises under conservatorship on September 7, 2008. James B. Lockhart, director of Federal Housing Finance Agency, said that Fannie Mae and Freddie Mac share the critical mission of providing stability and liquidity to the housing market. Between them, the Enterprises have $5.4 trillion of guaranteed mortgage-backed securities (MBS) and debt outstanding, which is equal to the publicly held debt of the United States. Among the key components of the conservatorship, the FHFA, as conservator, assumed the power of the Board and management. FIRST BANCORP: Fitch Downgrades Issuer Default Rating to 'B-' ------------------------------------------------------------- Fitch Ratings has downgraded First BanCorp's long-term Issuer Default Ratings to 'B-' from 'BB' and Individual ratings to 'D/E' from 'C/D'. Fitch also downgraded the ratings of FBP's subsidiary, FirstBank of Puerto Rico to 'B' from 'BB' and the Individual rating to 'D' from 'C/D'. The Rating Outlook is Negative. The ratings downgrade reflects Fitch's view that FBP's earnings pressure will be prolonged and impacted mainly by higher credit costs. Asset quality performance has been severely weakened due to the real estate market in South Florida and the weak economic conditions in Puerto Rico. The level of non-performing loans is expected to remain elevated, which may also require additional provisions. Fitch is also concerned with the tangible common equity ratio, which has trended down in recent periods and was 4.44% at June 30, 2009. As such, a future net loss of similarly size to the second-quarter period could cause the company to fall below 4%, although regulatory capital levels have remained adequate to date. Given recent financial performance, FBP has suspended its preferred, including Capital Purchase Program preferred, and common stock dividends. As of June 30, 2009, preferred stock outstanding totaled $926.3 million, of which $400 million related to the government's CPP. Fitch estimates that annual debt service approximates to $70 million per year and the company had $83.4 million of holding company cash. Fitch also acknowledges recent management changes at both the CEO and CFO level, which underscores FBP's operating challenges. Fitch assigns Recovery Ratings to individual security issues where the IDR of the issuer is rated in the 'B' or below category. As such, Fitch has assigned a Recovery Rating of 'RR2' to the uninsured long-term deposits of FirstBank Puerto Rico, which implies a recovery between 71%-90% on these instruments in the event of failure or default by the issuer. Fitch has downgraded these ratings: First BanCorp -- Long-term IDR to 'B-' from 'BB'; -- Short-term IDR to 'C' from 'B'; -- Individual to 'D/E' from 'C/D'. FirstBank Puerto Rico -- Long-term IDR to 'B' from 'BB'; -- Long-term deposit obligations to 'BB-/RR2' from 'BB+'; -- Individual to 'D' from 'C/D'. Fitch has affirmed these ratings: First BanCorp -- Support '5'; -- Support Floor 'NF'. FirstBank Puerto Rico -- Short-term deposit obligations at 'B'; -- Short-term IDR at 'B'; -- Support at '5'; -- Support Floor 'NF'. FLORIDA PLANT: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Florida Plant Specialists, LLC 874 Commerce Blvd. Crawfordville, FL 32327 Bankruptcy Case No.: 09-40930 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of Florida (Tallahassee) Debtor's Counsel: Allen Turnage, Esq. Law Office of Allen Turnage P.O. Box 15219 2344 Centerville Road, Suite 101 Tallahassee, FL 32317 Tel: (850) 224-3231 Fax: (850) 224-2535 Email: service.attyallen@embarqmail.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $838,550, and total debts of $1,192,273. 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/flnb09-40930.pdf The petition was signed by Edward Ronald Fox, president of the Company. FLYING J: Denies Rumors on Truck Stop Sale, Restaurant Closing -------------------------------------------------------------- Matthew Perenchio at Jackson County Chronicle reports that Flying J Travel Plaza general manager Greg Patterson has denied rumors on the Black River Falls Flying J truck stop being sold and replacing the Flying J Country Market Restaurant with an International House of Pancakes or a Denny's restaurant. Jackson County Chronicle relates that the rumors come amid an ongoing merger between Flying J Inc. and Pilot Travel Centers LLC. According to the report, Flying J spokesperson Peter Hill said that the Company's reorganizing plan has led to various rumors regarding its Travel Plazas, but changes wouldn't occur until after a merger with Pilot is completed, which could be finalized by year-end. According to Jackson County Chronicle, some changes might be possible in the future. The report quoted Mr. Patterson as saying, "There is some long-term plan of changing over the restaurant into something different, but the company has assured us they will let us know what that situation will be. Right now, nothing is changing." Based in Ogden, Utah, Flying J Inc. -- http://www.flyingj.com/-- is among the 20 largest private companies in America, with 2007 sales exceeding $16 billion. The fully integrated oil company employs approximately 14,700 people in the U.S. and Canada through its interstate operations, transportation, refining and supply, exploration and production, as well as its financial services and communications, divisions. Flying J and six of its affiliates filed for bankruptcy on December 22, 2008 (Bankr. D. Del. Lead Case No. 08-13384). Flying J sought Chapter 11 protections after a precipitous drop in oil prices and disruption in the credit markets brought to bear significant short-term pressure on the company's liquidity position. Attorneys at Kirkland & Ellis LLP represent the Debtors as counsel. Young, Conaway, Stargatt & Taylor LLP is the Debtors' Delaware Counsel. Blackstone Advisory Services L.P. is the Debtors' investment banker and financial advisor. Epiq Bankruptcy Solutions LLC is the Debtors' notice, claims and balloting agent. In its formal schedules submitted to the Bankruptcy Court, Flying J listed assets of $1,433,724,226 and debts of $640,958,656. An official committee of unsecured creditors has been appointed in the case. Pachulski Stang Ziehl & Jones LLP has been tapped as counsel for the creditors' panel. FONAR CORPORATION: Marcum LLP Raises Going Concern Doubt -------------------------------------------------------- Marcum LLP, in New York, N.Y., expressed substantial doubt about FONAR Corporation's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended June 30, 2009. The auditing firm said that the Company has suffered recurring losses from operations, continues to generate negative cash flows from operating activities, has negative working capital at June 30, 2009, and is dependent on asset sales to fund its shortfall from operations. The Company reported net income of $1.1 million on total net revenues of $39.7 million for the year ended June 30, 2009, compared with a net loss of $13.5 million on total net revenues of $35.6 million in fiscal 2008. Included in net income for fiscal 2009 is a gain of $1.4 million recognized by the Company on the sale of a consolidated subsidiary. Product sales revenues increased 51.6% from $11.3 million in fiscal 2008 to $17.2 million in fiscal 2009. Related management fees decreased by 11.9%. In addition, total costs and expenses decreased by 23.0%. Consolidated operating results improved to an operating loss of $703,937 for fiscal 2009 as compared to an operating loss of $16.9 million for fiscal 2008. At June 30, 2009, the Company's consolidated balance sheet showed $28.4 million in total assets, $31.2 million in total liabilities, and $63,815 in minority interest, resulting in a $2.9 million stockholders' deficit. The Company's consolidated balance sheet at June 30, 2009, also showed strained liquidity with $18.3 million in total current assets available to pay $29.1 million in total current liabilities. Liquidity Net cash used in operating activities for the year ended June 30, 2009, was approximately $6.1 million. The Company funded its cash flow deficit from operations for the year ended June 30, 2009, through cash provided from the sale of marketable securities of approximately $1.1 million, proceeds from notes receivable of $2.0 million, loans from life insurance policies of apProximately $1.3 million, and proceeds from the sale of its subsidiary of approximately $2.3 million. Full-text copies of the Company's consolidated financial statements for the year ended June 30, 2009, are available for free at http://researcharchives.com/t/s?468a Based in Melville, New York, FONAR Corporation -- http://www.fonar.com/-- is engaged in the research, development, production and marketing of medical scanning equipment, which uses principles of Magnetic Resonance Imaging ("MRI") for the detection and diagnosis of human diseases. In addition to deriving revenues from the direct sale of MRI equipment, revenue is also generated from its installed-base of customers through its service and upgrade programs. FONAR, through its wholly-owned subsidiary Health Management Corporation of America, provides comprehensive management services to diagnostic imaging facilities. The services provided by the Company include development, administration, leasing of office space, facilities and medical equipment, provision of supplies, staffing and supervision of non-medical personnel, legal services, accounting, billing and collection and the development and implementation of practice growth and marketing strategies. As of June 30, 2009, HMCA manages 10 diagnostic imaging facilities located in the states of New York, Georgia and Florida. FREDDIE TARVER: Case Summary & 5 Largest Unsec. Creditors --------------------------------------------------------- Joint Debtors: Freddie Norwood Tarver Vera Lee Tarver 614 Jackson P.O. Box 891 Edna, TX 77957 Bankruptcy Case No.: 09-60172 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court Southern District of Texas (Victoria) Judge: Wesley W. Steen Debtors' Counsel: Jerome A. Brown, Esq. Brown & Associates PO Box 1667 Victoria, TX 77902 Tel: (361) 579-6700 Email: jerome@txbizlaw.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 5 largest unsecured creditors is available for free at: http://bankrupt.com/misc/txsb09-60172.pdf The petition was signed by the Joint Debtors. FREEDOM COMMUNICATIONS: Committee Balks Bid to Use Cash Collateral ------------------------------------------------------------------ The Official Committee of Unsecured Creditors objects to Freedom Communications Inc.'s request to use cash collateral of its prepetition lenders. The Committee said in a filing with the U.S. Bankruptcy Court for the District of Delaware that the plan support agreement reached with lenders imposes onerous terms that have less to do with providing adequate protection than with gaining leverage over the Committee in an inevitable confirmation fight over a discriminatory and unconfirmable plan. It ties the use of cash collateral to fast-track confirmation proceedings on a plan that hands over the company to the lenders while conferring significant benefits on existing shareholders and management, even as it pays almost nothing to most creditors, except those hand-picked by the Debtors, to receive payment in full, the Committee adds. The agreement requires the Debtors to file a plan that would give prepetition lenders secured claims of about $325 million and 98% of the equity of the reorganized Debtors, among other things. According to the Committee, the terms of the cash collateral request require the Debtors to make impermissible payments of pre- and post-petition interest and fees to the lenders on putatively undersecured claims and grant liens on presently unencumbered valuable assets, while imposing severe constraints on the ability of creditors to investigate or challenge the lenders' claims and draconian punishments for any acts of disobedience. The Debtors ask the Court to deny approval of the Debtors' request to use their lenders' cash collateral. A hearing is set for Oct. 14, 2009, at 10:00 a.m., to consider the Committee's request. A full-text copy of the Committee's objection is available for free at http://ResearchArchives.com/t/s?468d About Freedom Communications Freedom Communications, headquartered in Irvine, Calif., is a national privately owned information and entertainment company of print publications, broadcast television stations and interactive businesses. The company's print portfolio includes approximately 90 daily and weekly publications, including approximately 30 daily newspapers, plus ancillary magazines and other specialty publications. The broadcast company's stations -- five CBS, two ABC network affiliates and one CW affiliate -- reach more than 3 million households across the country. The Company's news, information and entertainment Web sites complement its print and broadcast properties. Freedom Communications filed for Chapter 11 on Sept. 1, 2009 (Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11 counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as financial advisor while AlixPartners LLC is restructuring consultant. Logan & Co. serves as claims and notice agent. Freedom Communications had $757,000,000 in assets against debts of $1,077,000,000 as of July 31, 2009. FREEDOM COMMUNICATIONS: Has Until November 16 to Files Schedules ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware extended the period within which Freedom Communications Holdings Inc. and its debtor-affiliates can file their schedules of assets and liabilities, and statements of financial affairs until Nov. 16, 2009. The Court ruled that the extension of time is in the best interest of the Debtors, their estates, creditors and other parties-in- interest. About Freedom Communications Freedom Communications, headquartered in Irvine, Calif., is a national privately owned information and entertainment company of print publications, broadcast television stations and interactive businesses. The company's print portfolio includes approximately 90 daily and weekly publications, including approximately 30 daily newspapers, plus ancillary magazines and other specialty publications. The broadcast company's stations -- five CBS, two ABC network affiliates and one CW affiliate -- reach more than 3 million households across the country. The Company's news, information and entertainment Web sites complement its print and broadcast properties. Freedom Communications filed for Chapter 11 on Sept. 1, 2009 (Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11 counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as financial advisor while AlixPartners LLC is restructuring consultant. Logan & Co. serves as claims and notice agent. FREEDOM COMMUNICATIONS: U.S. Trustee Forms Five-Member Committee ---------------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, appointed five creditors to serve on the Official Committee of Unsecured Creditors for Freedom Communications Holdings Inc. and it's debtor-affiliates. The members of the Committee: a) Pension Benefit Guaranty Corporation Attn: Craig Yamaoka 1200 K. Street, N.W. Washington, DC 20005 Tel: (202) 326-4070 ex. 3614 Fax: (202) 842-2643 b) Nelson Gonzalez c/o Callahan & Blaine, APLC 3 Hutton Centre Drive, Ninth Floor Santa Ana, CA 92707 Tel: (714) 241-4444 Fax: (714) 241-4445 c) Telerep LLC Attn: Pamela D' Elia 1 Dag Hammarskjold Plaza New York, NY 10017 Tel: (212) 759-8787 Fax: (212) 486-0811 d) Pitman Co. Attn: Eileen Mezzo, VP Finance 721 Union Blvd. Totowa, NJ 07512 Tel: (973) 890-8519 Fax: (973) 237-9101 e) Alan J. Bell 428 Paseo Miramar Pacific Palisades, CA 90272 Tel: (310) 503-5544 Fax: (310) 459-8739 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 Attnempt 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 Freedom Communications Freedom Communications, headquartered in Irvine, Calif., is a national privately owned information and entertainment company of print publications, broadcast television stations and interactive businesses. The company's print portfolio includes approximately 90 daily and weekly publications, including approximately 30 daily newspapers, plus ancillary magazines and other specialty publications. The broadcast company's stations -- five CBS, two ABC network affiliates and one CW affiliate -- reach more than 3 million households across the country. The Company's news, information and entertainment Web sites complement its print and broadcast properties. Freedom Communications filed for Chapter 11 on Sept. 1, 2009 (Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11 counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as financial advisor while AlixPartners LLC is restructuring consultant. Logan & Co. serves as claims and notice agent. Freedom Communications had $757,000,000 in assets against debts of $1,077,000,000 as of July 31, 2009. FREEDOM COMMUNICATIONS: Creditors Blast Houlihan Lokey Involvement ------------------------------------------------------------------ Law360 reports that Freedom Communications Holdings Inc.'s unsecured creditors have lambasted Houlihan Lokey Howard & Zukin Capital Inc., claiming the investment banking firm should not be allowed to continue serving the Debtor during a restructuring that has so far produced a skewed and costly Chapter 11 plan. Freedom Communications, headquartered in Irvine, Calif., is a national privately owned information and entertainment company of print publications, broadcast television stations and interactive businesses. The company's print portfolio includes approximately 90 daily and weekly publications, including approximately 30 daily newspapers, plus ancillary magazines and other specialty publications. The broadcast company's stations -- five CBS, two ABC network affiliates and one CW affiliate -- reach more than 3 million households across the country. The Company's news, information and entertainment Web sites complement its print and broadcast properties. Freedom Communications filed for Chapter 11 on Sept. 1, 2009 (Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11 counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as financial advisor while AlixPartners LLC is restructuring consultant. Logan & Co. serves as claims and notice agent. Freedom Communications had $757,000,000 in assets against debts of $1,077,000,000 as of July 31, 2009. GARY MCDOUGAL: Voluntary Chapter 11 Case Summary ------------------------------------------------ Joint Debtors: Gary McDougal Phyllis McDougal 11 Knotty Pine Place Texarkana, TX 75503 Bankruptcy Case No.: 09-50242 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court Eastern District of Texas (Texarkana) Judge: Brenda T. Rhoades Debtors' Counsel: Bill F. Payne, Esq. 100 North Main Street Paris, TX 75460-4222 Tel: (903) 784-4393 ext. 40 Email: lgarner@moorefirm.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. GENTA INC: Amends Lease Agreement with Connell Company ------------------------------------------------------ Genta Incorporated on October 1, 2009, entered into an Amendment of its Lease Agreement with The Connell Company, a corporation based in New Jersey. The Company extended its lease of office space in Berkeley Heights, New Jersey, for an additional six months until August 31, 2010. A full-text copy of the Lease Agreement is available at no charge at http://ResearchArchives.com/t/s?469a About Genta Incorporated Genta Incorporated -- http://www.genta.com/-- is a biopharmaceutical company with a diversified product portfolio that is focused on delivering innovative products for the treatment of patients with cancer. Two major programs anchor the Company's research platform: DNA/RNA-based Medicines and Small Molecules. Genasense(R) (oblimersen sodium) Injection is the Company's lead compound from its DNA/RNA Medicines program. The leading drug in Genta's Small Molecule program is Ganite(R) (gallium nitrate injection), which the Company is exclusively marketing in the U.S. for treatment of symptomatic patients with cancer related hypercalcemia that is resistant to hydration. The Company has developed G4544, an oral formulation of the active ingredient in Ganite, which has recently entered clinical trials as a potential treatment for diseases associated with accelerated bone loss. The Company is also developing tesetaxel, a novel, orally absorbed, semi-synthetic taxane that is in the same class of drugs as paclitaxel and docetaxel. Ganite and Genasense are available on a "named-patient" basis in countries outside the United States. At June 30, 2009, Genta had $10.2 million in total assets; and $12.1 million in total current liabilities and $2.46 million in total long-term liabilities, resulting in $4.33 million in stockholders' deficit. In its second quarter 2009 report on Form 10-Q, the Company said its recurring losses and negative cash flows from operation raise substantial doubt about its ability to continue as a going concern. GENERAL MOTORS: Penske Ends Talks to Buy Saturn Brand ----------------------------------------------------- Penske Automotive Group, Inc. has terminated its discussions with General Motors Company to acquire the Saturn brand, citing concerns directly related to the future supply of vehicles beyond the supply period it had negotiated with GM. Since announcing the talks in June, Penske has been in the due diligence process to determine the feasibility of developing an independent distribution model for Saturn-branded products and service parts in the United States, including the sourcing of vehicles from GM and other potential suppliers. The company had negotiated a definitive agreement with GM to source vehicles on a contract-manufactured basis for a period of time. After this period, the company would have been required to source vehicles from another third party under a similar contract-manufacturing agreement. According to reports, Penske was in talks with a South Korean subsidiary of Renault SA to build Saturn cars but the deal failed to push through. Penske, in a statement, said it negotiated the terms of manufacturing contract but that agreement was rejected by that manufacturer's board of directors. "Without that agreement, the company has determined that the risks and uncertainties related to the availability of future products prohibit the company from moving forward with this transaction." About Penske Automotive Penske Automotive Group, Inc. (NYSE: PAG) -- http://www.penskeautomotive.com/-- headquartered in Bloomfield Hills, Michigan, operates 310 retail automotive franchises, representing 40 different brands and 25 collision repair centers. Penske Automotive, which sells new and previously owned vehicles, finance and insurance products and replacement parts, and offers maintenance and repair services on all brands it represents, has 160 franchises in 17 states and Puerto Rico and 150 franchises located outside the United States, primarily in the United Kingdom. Penske Automotive is also the exclusive distributor of the smart fortwo through its wholly owned subsidiary smart USA Distributor LLC. smart USA supports 78 smart retail centers in the United States. Penske Automotive is a member of the Fortune 500 and Russell 1000 and has approximately 14,000 employees. smart and fortwo are registered trademarks of Daimler AG. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- as 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). 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. 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, serves as the Chief Executive Officer for Motors Liquidation Company. 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. 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). GREEN WAY DEVELOPERS: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Green Way Developers, Inc. 7370 Hodgson Memorial Drive, Suite D-10 Savannah, GA 31406 Case No.: 09-42296 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Southern District of Georgia (Savannah) Debtor's Counsel: James L. Drake Jr., Esq. P.O. Box 9945 Savannah, GA 31412 Tel: (912) 790-1533 Email: jdrake7@bellsouth.net Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 According to the schedules, the Company has assets of at least $18,262,083, and total debts of $12,964,070. The petition was signed by Louis C. Young Jr., the company's president and treasurer. Debtor's List of 4 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ McLendon Enterprises, Inc. Trade Debt $155,936 Lovins Branch & Co. PC Accounting Services $8,167 Pela Design Group Engineering Services $2,459 ADI-Advertising by Design, Advertising $1,644 Inc. GREENWOOD ENTERPRISES: Case Summary & 12 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Greenwood Enterprises, L.L.C. 5081 Baker Blvd., Suite B Baker, LA 70714 Bankruptcy Case No.: 09-11568 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Middle District of Louisiana (Baton Rouge) Debtor's Counsel: Gary K. McKenzie, Esq. Steffes, Vingiello & McKenzie, LLC 13702 Coursey Boulevard Building 3 Baton Rouge, LA 70817 Tel: (225) 751-1751 Fax: (225) 751-1998 Email: gmckenzie@steffeslaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 12 largest unsecured creditors is available for free at: http://bankrupt.com/misc/lamb09-11568.pdf The petition was signed by Deionna Richardson, manager of the Company. GROUND & POUND LLC: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Ground & Pound, LLC 4506 Sherwood Lane Houston, TX 77092 Bankruptcy Case No.: 09-37609 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Southern District of Texas (Houston)) Judge: Karen K. Brown Debtor's Counsel: Reese W. Baker, Esq. Baker Assoc LLP 5151 Katy Freeway Suite 200 Houston, TX 77007 Tel: (713) 869-9200 Fax: (713) 869-9100 Email: reese.baker@bakerassociates.net Estimated Assets: $500,001 to $1,000,000 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 Gary Arnold, authorized member of the Company. GTC BIOTHERAPEUTICS: Board Appoints Four New Directors ------------------------------------------------------ GTC Biotherapeutics, Inc., reports that on October 1, 2009, its Board of Directors appointed William Heiden, Evelyne Nguyen, Bertrand Merot, and Jean-Fran‡ois Prost M.D. as directors. The directors were nominated by LFB Biotechnologies S.A.S. in accordance with its right under GTC's funding agreements to appoint a number of directors to the Board commensurate with LFB's ownership percentage of GTC. To accommodate LFB's plan not to increase the size of the Company's Board, Robert Baldridge, Kenneth Bauer M.D., Mary Ann Gray and Marvin Miller resigned as directors, effective immediately. Dr. Prost will serve in the class of directors whose terms expire at the 2010 annual meeting of shareholders, Mr. Heiden will serve in the class of directors whose terms expire at the 2011 annual meeting of shareholders, and Ms. Nguyen and Mr. Merot will serve in the class of directors whose terms expire at the 2012 annual meeting of shareholders. The incoming directors were not appointed to any Board committees. As employees of LFB or their subsidiaries, Mr. Merot, Ms. Nguyen, and Dr. Prost and will not be eligible for any compensation for their services on the Board. In exchange for his services, Mr. Heiden will be eligible to participate in the Company's current standard compensation arrangements for non-employee directors. Accordingly, the Company issued Mr. Heiden, pursuant to the Company's amended and restated 2002 Equity Incentive Plan, an option to purchase 3,000 shares of the Company's common stock, half of which vested upon his election and half of which will vest at the Company's annual meeting of shareholders in 2010. Mr. Heiden will also receive an annual retainer fee of $20,000, payable in quarterly installments and applicable attendance fees. All of the Company's directors will receive reimbursement of reasonable expenses incurred in connection with board-related activities and will also be entitled to indemnification under the terms of the Company's standard form of director indemnification agreement. 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. 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. HATTIE CRANE SCHERBACK: Voluntary Chapter 11 Case Summary --------------------------------------------------------- Debtor: Hattie Crane Scherback fka Hattie Maye Reed fka Hattie Maye Crane 111 West Grizzly DeKalb, TX 75559 Case No.: 09-50243 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court Eastern District of Texas (Texarkana) Judge: Brenda T. Rhoades Debtor's Counsel: Joyce W. Lindauer, Esq. 8140 Walnut Hill Lane, Suite 301 Dallas, TX 75231 Tel: (972) 503-4033 Fax: (972) 503-4034 Email: courts@joycelindauer.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. HAYES LEMMERZ: Creditors Try to Shred Chapter 11 Plan ----------------------------------------------------- Law360 reports that creditors have pelted Hayes Lemmerz International Inc. with objections to a broadly supported amended plan of reorganization they say is amiss, not least because Hayes failed to obtain consent from certain lenders before arranging debtor-in-possession financing. The hearing to confirm the Plan has been scheduled for October 15, 2009. As reported by the TCR on Sept. 4, 2009, Hayes Lemmerz has reached an agreement among its DIP lenders, prepetition secured lenders and the Official Committee of Unsecured Creditors on the terms of a plan of reorganization. Under the Revised Plan, certain of the Debtors' prepetition secured lenders, which funded the operations of the Debtors through a $200 million of debtor-in-possession financing, will receive majority ownership of the reorganized Company upon emergence from Chapter 11. Unsecured noteholders are expected to recover 5% of their allowed claims. A copy of the Revised Disclosure Statement is available for free at http://bankrupt.com/misc/Hayes_Revised_DS_Blacklined.pdf About Hayes Lemmerz 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. HERTZ CORP: Audit Integrity Wants SEC to Probe Hertz ------------------------------------------------------ Audit Integrity has asked the Securities and Exchange Commission to investigate Hertz Global Holdings, Inc.'s "blatant" attempts to induce 19 companies to consider filing lawsuits because of the firm's recently issued bankruptcy model. In an October 5 letter sent via overnight delivery to SEC Chairman Mary L. Schapiro, Audit Integrity Chairman and founder James A. Kaplan disclosed that Hertz sent his firm a threatening letter signaling its possible intent to sue his company unless it retracted a critical report identifying Hertz and 19 other publicly traded companies as being statistically more at risk than their peers to file bankruptcy in the next 12 months. The letter was signed by Jeffrey Zimmerman, General Counsel and Secretary of Hertz, and the corporate counsels of the other 19 companies identified in the report were copied. Audit Integrity recently released the findings of its newly launched bankruptcy model, which calculates the statistical likelihood that publicly-traded companies will file for bankruptcy. The model is designed as a risk measurement tool for insurance companies, auditors and institutional investors, who have a greater concern about companies' financial solvency risks. The model uses objective information and a proven modeling approach that has yielded highly predictive results. Hertz on September 25 sued Audit Integrity in Superior court of New Jersey for defamation and trade libel. Although no other companies have sued Audit Integrity for its bankruptcy risk report, a Hertz spokesman was quoted in a September 30 Dow Jones story as saying it's "still early." "As Hertz's ultimate goal was to silence an independent research firm calling regulatory and investor attention to the company's real and material financial risk, the matter warrants an investigation by the Securities and Exchange Commission," Mr. Kaplan says. "Hertz's lawsuit is frivolous and without merit, and we are confident it will be dismissed. Our findings are objective and verifiable, and we stand by them." Audit Integrity is an independent firm that focuses on developing quantitative risk models for the financial markets. Its statistical models are entirely objective and use publicly- available data. The firm receives no compensation for its ratings. Its clients are highly-regarded firms in the investment industry, national regulatory agencies in the U.S. and Canada, the largest pension plans, several of the "Top Four" auditing firms, and the largest insurance companies. Its quantitative research has proven to be quite useful to its clients. Audit Integrity was among the first to issue warnings about Bank of America, Lehman Brothers, Bear Stearns, and Countrywide Financial. It also warned about Huron Consulting, a company founded by former Arthur Andersen employees, whose recently issued major restatement has provoked an SEC investigation. "Mr. Zimmerman has offered no evidence of factual errors or inaccuracies in our analysis," Mr. Kaplan says. "In maligning our research, Mr. Zimmerman also charges that we "ignored qualitative information" and notes that various equity analysts support his company. The fact that analysts who make qualitative judgments support his company is meaningless since in fact we intentionally do not engage in this type of analysis." Mr. Kaplan notes that Hertz's most recent 10-K contains two dozen pages of financial and business continuity warnings. Research firm Audit Integrity, in a Sept. 16 report, identified 20 corporations, with $1 billion or more in market capitalization, that have the highest probability of declaring bankruptcy in the next twelve months. The list included Hertz Global. About Hertz Corporation The Hertz Corporation, a subsidiary of Hertz Global Holdings, Inc. (NYSE: HTZ), based in Park Ridge, New Jersey, is the world's largest general use car rental brand, operating from approximately 8,000 locations in 147 countries worldwide. Hertz also operates one of the world's largest equipment rental businesses, Hertz Equipment Rental Corporation, through more than 375 branches in the United States, Canada, France, Spain and China. The Hertz Corporation, is the primary operating company and a direct wholly-owned subsidiary of Hertz Investors, Inc., which is wholly-owned by Hertz Global Holdings. Hertz Global and its subsidiaries had total assets of $15,650,038,000 against total debts of $13,856,915,000 as of June 30, 2009. In July, Fitch Ratings downgraded Hertz Corporation's Issuer Default Rating to 'BB-' from 'BB', and Moody's Investors Service lowered Hertz's Corporate Family Rating and Probability of Default to 'B1' from 'Ba3'. Hertz carries 'B' issuer credit ratings from Standard & Poor's. HOVNANIAN ENTERPRISES: Fitch Affirms 'CCC' Issuer Default Rating ---------------------------------------------------------------- Fitch has assigned a 'B-/RR3' rating to Hovnanian Enterprises, Inc.'s $785 million, 10.625% senior secured notes due Oct. 15, 2016. Proceeds from the notes offering will be used to fund the previously announced tender offer for its outstanding senior secured notes and certain of its senior unsecured notes. Fitch affirms HOV's ratings: -- Issuer Default Rating at 'CCC'; -- Senior subordinated notes at 'C/RR6'; -- Series A perpetual preferred stock at 'C/RR6'. Fitch has also downgraded these ratings: -- Senior secured notes (second lien) to 'C/RR6' from 'B+/RR1'; -- Senior secured notes (third lien) to 'C/RR6' from 'B+/RR1'; -- Senior unsecured notes to 'C/RR6' from 'CC/RR5'. The Rating Outlook is Negative. Fitch's Recovery Rating of '3' on HOV's senior secured notes indicates good (50%-70%) recovery prospects for holders of these debt issue. The 'RR6' on HOV's senior unsecured notes, senior subordinated notes and preferred stock indicates poor (0%-10%) recovery prospects in a default scenario. The downgrade of the existing senior secured notes (second and third lien) as well as the unsecured senior notes reflects lower recovery prospects as a result of the new first lien secured debt that is ranked ahead of these debt issues in the capital structure. HOV's exposure to claims made pursuant to performance bonds and the possibility that part of these contingent liabilities would have a claim against the company's assets were considered in determining the recovery for the unsecured debt holders. Fitch applied a liquidation value analysis for these RRs. The ratings and Outlook for HOV reflect the current very difficult U.S. housing market and Fitch's expectations that the housing environment remains challenging into 2010. Nevertheless, there are more positive signals and developments for housing and related industries now than at any time previously in the downturn. Of course, challenges remain or are on the horizon that may not prevent a near-term bottom, but are likely to meaningfully moderate the early stages of a recovery. Over the past few quarters, HOV has lowered its absolute debt level through the repurchase of debt in open market transactions and cash tender offers. Total homebuilding debt declined from $2.6 billion at Oct. 31, 2008 to $1.8 billion at July 31, 2009. The issuance of the new senior secured notes and the consummation of the previously announced tender offers also extend the company's debt maturities. HOV also announced that it expects to terminate its existing $300 million revolving credit facility, which provided $100 million of borrowings for general corporate purposes and $200 million for the issuance of letters of credit. The company intends to enter into new agreements for the issuance of letters of credit. Consistent with Fitch's comment on certain homebuilders' termination of revolving credit facilities, in the absence of a revolving credit line, a consistently higher level of cash and equivalents than was typical should be maintained on the balance sheet, especially in these still uncertain times. Fitch will continue to monitor broad housing market trends as well as company-specific activity, such as land and development spending, general inventory levels, speculative inventory activity, gross and net new-order activity, debt levels (including the potential for additional debt repurchases) and especially free cash flow trends and uses and the company's cash position. INNOVATIER INC: Emerges From Chapter 11; Creditor Recovery at 100% ------------------------------------------------------------------ Innovatier Inc. said its confirmed reorganization plan became effective September 23, 2009. It said that all creditors will be paid 100% of the amount owed at the time of the initial filing, February 3, 2009. During the reorganization, Innovatier was able to continue the implementation of its business plan to deliver new innovative cards to the market place, and as in 2Q09, again delivered in excess of 1MM powered and gift cards in 3Q09. "Once again, our accomplishment over the last two quarters validates the capabilities of our high speed manufacturing line," stated Robert Singleton, President. "During this start up phase we have been able to exceed our targeted manufacturing rates and efficiencies." "Our customers and majority of our creditors provided us the time and opportunity to prove ourselves," stated Lawrence J. Keim, CFO. "We have attained profitability and positive EBITDA within a very short time and expect continued growth throughout 4Q09 and 2010." About Innovatier Inc. Innovatier offers superior and cost-effective packaging solutions at low temperature and low pressure for active RFID and powered cards. In addition to manufacturing, it assists customers with product development for a multitude of applications such as financial transaction cards, display technology, novelty/gift cards and security credentials using various sensor technologies. Innovatier Inc. filed for Chapter 11 on Feb. 3, 2009 (Bankr. M.D. Fla. Case No. 09-01981). Alberto F. Gomez, Jr., Esq., represented the Debtor in its restructuring effort. The petition says assets and debts were between $1 million and $10 million at the time of the filing. INSIGNIA SOLUTIONS: Files DollarDays' Business Presentation ----------------------------------------------------------- Insignia Solutions PLC reports that on September 24, 2009, Marc Joseph, President of DollarDays International, Inc., a wholly owned subsidiary of the Company, made a presentation regarding the business and operations of DollarDays International to various parties. DollarDays is an online wholesale distributor and closeout company helping small businesses and entrepreneurs survive and thrive against larger enterprises. There are currently 1,431,494 registered users and DollarDays averages 30,000 new registrations a month. A full-text copy of the slide show presented at the Marketing Sherpa Conference in San Francisco is available at no charge at http://ResearchArchives.com/t/s?4699 At June 30, 2009, the Company's balance sheet showed total assets of $1,937,390, total liabilities of $1,608,652 and stockholders' equity of $328,738. On March 30, 2009, Malone & bailey, PC in Houston, Texas, expressed substantial doubt about Insignia Solutions plc's ability to continue as a going concern after auditing the Company's financial statements for fiscal years ended December 31, 2008, and 2007. The auditor noted that the Company has suffered an accumulated deficit. The Company also state that it has a recent history of operating losses and operating cash outflows. About Insignia Solutions plc Headquartered in Fremont, California, Insignia Solutions plc, dba DollarDays International, Inc., develops software programs and provides general merchandise for resale to businesses through its Web site at http://www.DollarDays.com/ INTERDENT SERVICE: Loan Maturity Won't Move Moody's 'Caa2' Rating ----------------------------------------------------------------- Moody's Investors Service commented that InterDent Service Corporation's ratings and outlook, including the Caa2 corporate family rating and negative outlook, remain unaffected by the upcoming maturity of its revolving credit facility. The last rating action was on January 10, 2008, when the ratings of InterDent were lowered, including the corporate family rating which was lowered to Caa2. InterDent'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 and tolerance for risk. These attributes were compared against other issuers both within and outside of InterDent's core industry and InterDent's ratings are believed to be comparable to those of other issuers of similar credit risk. Headquartered in El Segundo, California, InterDent provides practice management services to multi-specialty group dental practices in the United States. InterDent had revenues of approximately $222 million for the twelve month period ended June 30, 2009. IRIDIUM COMMUNICATIONS: S&P Assigns 'B' Corporate Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B' corporate credit rating to Bethesda, Maryland-based satellites services provider Iridium Communications Inc., formerly known as GHL Acquisition Corp. At the same time, S&P withdrew the corporate credit rating on wholly owned subsidiary Iridium Satellite LLC and removed it from CreditWatch with positive implications, where it was placed on Sept. 25, 2008. The 'B' rating is one notch higher than the previous corporate credit rating of 'B-' that was assigned to Iridium Satellite. The rating action, which is in line with S&P's March 17, 2009, CreditWatch update on Iridium Satellite LLC, is due to the Sept. 29 consummation of the merger between Iridium Satellite LLC and GHL Acquisition Corp., a special-purpose acquisition company sponsored by Greenhill & Co. Inc. As a result of the merger, the company fully repaid its credit facility, leaving the company with essentially relatively little outstanding debt. The 'B' rating does incorporate S&P's expectations for the addition of significant new debt to finance the Iridium NEXT satellite constellation. The outlook is stable. In addition, S&P withdrew its ratings on Iridium Satellite's amended credit facility. Under the terms of this facility, the company was required to prepay a portion of its credit facility upon the close of the transaction. The company repaid the entire credit facility on Sept. 30, 2009. Finally, S&P assigned a preliminary 'B/CCC+' rating to Iridium's shelf registration. These ratings are preliminary and will be revised to reflect the company's capital structure when the company issues from this shelf. Iridium provides mobile communications services to about 315,000 commercial customers and 32,000 Department of Defense users as of June 30, 2009. It operates 73 low-earth orbit satellites (including seven orbiting spares) and estimates that this constellation will provide full voice and data capability until at least 2014, based on expected degradation. To maintain the current level of service beyond 2014, the company needs to invest substantially in a second-generation replacement fleet as the existing constellation degrades. S&P estimate the cost through deployment to be more than $2 billion. Migrating to the new constellation provides both financial and operational challenges. The company's acquisition by GHL Acquisition Corp., a publicly traded company, which closed Sept. 29, 2009, could provide it with better access to capital to partially fund this second-generation satellite fleet. "With the close of the GHL Acquisition Corp. transaction and the repayment of the entire credit facility, the company will have relatively little debt," said Standard & Poor's credit analyst Naveen Sarma. With this transaction completed, S&P expects the company to accelerate its efforts to design and develop its second-generation satellite constellation, Iridium NEXT. However, cash on hand and future cash flow generation is far short of the approximately $2.7 billion cost to construct and launch the new satellites. "We expect the company will finance its future capital needs through both the equity and broader debt markets," added Mr. Sarma. The 'B' corporate credit rating incorporates S&P's expectations for significant future debt financings and a highly leveraged capital structure in the future. IRON HORSE GROUP: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Iron Horse Group, Inc. 4535 Wedge Drive Atlanta, GA 303314 Bankruptcy Case No.: 09-86516 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Wanda S. Jackson, Esq. Bldg. 1200 - Suite 150 3800 Camp Creek Parkway Atlanta, GA 30331 Tel: (404) 344-4421 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 Hershell Holliday, CEO of the Company. ISOLAGEN INC: Reorganizes as Fibrocell Science ---------------------------------------------- Isolagen, Inc., has reorganized and emerged from bankruptcy as Fibrocell Science, Inc. The company has named a new Board of Directors. The Food and Drug Administration is currently reviewing the biologics license application for Fibrocell Science's lead therapy, azfibrocel-T, in development to treat nasolabial fold wrinkles. Azfibrocel-T is the sole topic for discussion at the Cellular, Tissue and Gene Therapies Advisory Committee Meeting on October 9, 2009, in Bethesda, MD. Fibrocell Science Names New Board of Directors Fibrocell Science appointed a new Board of Directors and named David Pernock as chairman. Mr. Pernock joins Fibrocell Science with extensive commercial experience, most recently as senior vice president, Pharmaceuticals and Vaccines at GlaxoSmithKline. New Fibrocell Science board members named to date are Paul A. Hopper, managing director of Cappello Group, who has more than 20 years experience in international public company markets -- primarily in the medical, healthcare and biotechnology sectors; Kelvin D. Moore, consultant sales director for Seaborne Group with extensive experience in project leadership, business strategy, finance, business consultancy, new ventures, management and executive development; and Robert S. Langer, Ph.D., professor, chemical & biomedical engineering, Massachusetts Institute of Technology, and distinguished leader in the field of biomedical engineering. Declan Daly, who was instrumental in the company's reorganization and had served as an executive at Isolagen, will continue to lead Fibrocell Science as interim chief executive officer. The Board intends to name a CEO in the near future, and at that time, Declan Daly will continue to serve as chief operating officer and chief financial officer. "We welcome our new Board members and value their contributions during this transformational time for the Company," said Declan Daly. "We have a major near-term company milestone this week when the FDA advisory committee will review azfibrocel-T, our lead investigational cell therapy for the treatment of nasolabial fold wrinkles. We look forward to gaining Committee input, and working with the FDA as we seek to bring this novel aesthetic therapy to the market in 2010." BLA Review Underway; FDA Advisory Committee Scheduled In May 2009, the FDA accepted for full review the BLA of azfibrocel-T for the treatment of moderate to severe nasolabial fold wrinkles. The Prescription Drug User Fee Act target date for FDA response is January 4, 2010. The azfibrocel-T pivotal Phase III safety and efficacy studies evaluated a total of 421 individuals at 13 clinical sites across the United States. Study results demonstrated a significant difference in therapy results compared to placebo. No serious adverse events were reported. The Cellular, Tissue and Gene Therapies Advisory Committee Meeting will be held on October 9, 2009 in Bethesda, Maryland. About Azfibrocel-T Azfibrocel-T, proposed brand name Laviv(TM), is an investigational autologous cell therapy. In the Fibrocell Science patented process, a patient's own natural fibroblasts are extracted, multiplied and re-injected as personalized therapy. Fibroblasts are cells which contribute to the formation of connective tissue fibers. The therapy is currently under review by the FDA for the treatment of nasolabial fold wrinkles. Fibrocell Science, Inc. is planning to continue studies for additional aesthetic and therapeutic indications for azfibrocel-T. About Fibrocell Science, Inc. Fibrocell Science, Inc., is a biotechnology company focused on developing regenerative fibroblast cells for aesthetic, medical and scientific applications. Fibrocell Science is committed to advancing the scientific, medical and commercial potential of autologous skin and tissue, as well its innovative cellular processing technology and manufacturing excellence. About Isolagen Based in Exton, Pennsylvania, Isolagen(TM), Inc., is an aesthetic and therapeutic company committed to developing and commercializing scientific advances and innovative technologies. The Company's technology platform includes the Isolagen Process(TM), a cell processing system for skin and tissue rejuvenation which is currently in development. Isolagen also commercializes a scientifically-advanced line of skincare systems through its majority-owned subsidiary, Agera(R) Laboratories, Inc. Isolagen, Inc., and its wholly owned subsidiary, Isolagen Technologies, Inc., filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code on June 15, 2009 (Bankr. D. Del. Case Nos. 09-12072 and 09-12073). Mary E. Augustine, Esq., at Ciardi Ciardi & Astin, P.C., in Wilmington, Delaware, represents the Debtors. The Debtors disclosed $1,000,001 to $10,000,000 in estimated assets and debts. J.D II INC: Case Summary & 10 Largest Unsecured Creditors --------------------------------------------------------- Debtor: J.D II, Inc. 6320 Windpatterns Trail Fairfax Station, VA 22039 Bankruptcy Case No.: 09-28984 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court District of Maryland (Greenbelt) Judge: Thomas J. Catliota Debtor's Counsel: Bruce E. Gardner, Esq. 1101 Pennsylvania Ave., N.W., Suite 600 Washington, DC 20004 Tel: (202) 271-0552 Email: beegard@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $4,808,500, and total debts of $3,056,363. 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/mdb09-28984.pdf The petition was signed by Charles Jenkins, president of the Company. JAMES GLENN HARDY: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Joint Debtors: James Glenn Hardy aka Ole Counrty Smokehouse aka Glenn Hardy Sherry Lynn Hardy 1415 Keone Circle Williamston, SC 29697-9246 Bankruptcy Case No.: 09-07527 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court District of South Carolina (Spartanburg) Judge: Helen E. Burris Debtors' Counsel: Robert H. Cooper, Esq. 3523 Pelham Road, Suite B Greenville, SC 29615 Tel: (864) 271-9911 Email: bknotice@thecooperlawfirm.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. JOSEPH ZAPATA: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Joseph V. Zapata Merih O. Zapata aka Mary Zapata 12716 Cutten Road Houston, TX 77066 Bankruptcy Case No.: 09-37614 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Letitia Z. Paul Debtors' Counsel: Corey L. Mills, Esq. Mills & Henshaw, PLLC 11767 Katy Freeway, Suite 820 Houston, TX 77079 Tel: (281) 497-2650 Fax: (281) 497-2690 Email: ecfdocs@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 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/txsb09-37614.pdf The petition was signed by the Joint Debtors. JUPITER FAMILY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Jupiter Family Entertainment, LP dba Jupiter Bowl dba Jupiter Lanes 1136 Jupiter Road Dallas, TX 75218 Bankruptcy Case No.: 09-36793 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Debtor's Counsel: Gerald Philip Urbach, Esq. Hiersche, Hayward, Drakeley & Urbach 15303 Dallas Parkway, Suite 700 Addison, TX 75001 Tel: (972)701-7026 Fax: (972)701-8765 Email: gurbach@hhdulaw.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/txnb09-36793.pdf The petition was signed by Charels S. Lande. KANSAS CITY SOUTHERN: S&P Gives Stable Outlook, Affirms 'B' Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services revised its outlook on Kansas City Southern to stable from negative. At the same time, S&P affirmed its ratings on the company, including the 'B' long-term corporate credit rating. The rating action reflects KCS' improved liquidity position following an equity issuance, diminishing capital-spending needs, and modest debt maturities over the next few years. During the second quarter, KCS issued 4.3 million shares, raising net proceeds of $74 million. Also in the quarter, the company announced the completion of a $174 million track project in Texas. S&P expects capital expenditures to be moderate for the duration of the year, at about $100 million. Standard & Poor's expects modest improvement in credit metrics and liquidity position over the next few quarters as volume declines moderate. Still, earnings and cash flow will remain under pressure in the near term. Given KCS' relatively limited scale and end-market diversity, its earnings stability is somewhat weaker than its Class 1 peers. The company's Mexican operations, which represented 44% of consolidated revenues in 2008, have experienced pressure due to weakness in the automotive- and manufacturing-related sectors. KCS has partially offset the declines through aggressive cost savings from furloughing workers and idling equipment. The ratings on KCS reflect its highly leveraged capital structure, substantial capital-spending requirements, and challenges associated with Kansas City Southern de Mexico S.A. de C.V. (KCSM), the Mexican railroad company it acquired in April 2005. The favorable characteristics of the U.S. freight railroad industry and the company's strategically located rail network partly offset these risks. "Standard & Poor's expects KCS' operating results, credit measures, and liquidity position to strengthen by early 2010," said Standard & Poor's credit analyst Anita Ogbara. S&P could raise the ratings if earnings improvement bolsters liquidity and the company consistently maintains total debt to EBITDA below 5x. "Although less likely, S&P could lower the ratings if liquidity falls below $75 million and remains at this level over the near term," she continued. KENT ALAN GARDELLA: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Joint Debtors: Kent Alan Gardella dba Napa Valley Jewelers Theresa Anne Gardella 16 Joshua Ct. Napa, CA 94558 Bankruptcy Case No.: 09-13287 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtors' Counsel: David N. Chandler, Esq. Law Offices of David N. Chandler 1747 4th St. Santa Rosa, CA 95404 Tel: (707) 528-4331 Email: DChandler1747@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $2,584,600, and total debts of $3,196,077. A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/canb09-13287.pdf The petition was signed by the Joint Debtors. KOCH GROUP: Owner Fighting Suit, Tries to Take Co. Out of Ch 11 --------------------------------------------------------------- Frederick Melo at Pioneer Press reports that David Koch is struggling to keep his home in Mendota Heights and keep his restaurants Seven Steakhouse and Seven Sushi emerging from bankruptcy and attracting clients. Pioneer Press relates that Mr. Koch is in a legal battle involving Debra Thul, the mother of longtime associate Carey Thul, for alleged breach of contract. Pioneer Press states that Ms. Thul's civil lawsuit against Mr. Koch and her son moved forward with a pre-trial hearing in Dakota County District Court. The report says that a three-day trial is set for November 2. Ms. Thul said in court documents that Mr. Koch and her son Carey persuaded her six years ago to help them launch two of Mr. Koch's now-defunct businesses, the Escape Ultra-Lounge and the Bellanotte Italian restaurant, by selling her home. According to Pioneer Press, Ms. Thul argued that the two then stiffed her on almost $100,000 in house payments. Ms. Thul, according to court documents, said that she's on the verge of eviction because of it. Ms. Thul and her son were eager investors in the Escape club, which failed in July 2007, and knew the risks, Pioneer Press says, citing Mr. Koch. According to the report, Mr. Koch said that neither Ms. Thul nor her son ever invested in Bellanotte, which closed in July 2009. "Right now, my biggest plan is to finish taking Seven out of bankruptcy," Pioneer Press quoted Mr. Koch as saying. Mendota Heights, Minnesota-based Koch Group Mpls, LLC, dba Seven, owns and operates the Seven steakhouse and sushi restaurant in downtown Minneapolis. The Company filed for Chapter 11 bankruptcy protection on April 14, 2009 (Bankr. D. Minn. Case No. 09-42227). Lynn J.D. Wartchow, Esq., at Morris Law Group, P.A., assists the Company in its restructuring efforts. The Company listed $100,001 to $500,000 in assets and $1,000,001 to $10,000,000 in debts. LAURIE SOLLER D.D.S.: Case Summary & 2 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Laurie A. Soller D.D.S., P.A. 8170 Maple Lawn Boulevard, Suite 150 Fulton, MD 20759 Bankruptcy Case No.: 09-29023 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- Soller, LLC 09-29024 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Maryland (Baltimore) Judge: Nancy V. Alquist Debtor's Counsel: Karen H. Moore, Esq. 10211 Wincopin Circle, 6th Floor Columbia, MD 21044 Tel: (410) 309-0505 Email: kmoore@darslaw.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 2 largest unsecured creditors is available for free at: http://bankrupt.com/misc/mdb09-29023.pdf The petition was signed by Dr. Laurie A. Soller, D.D.S., sole owner of the Company. LE TAP OF ST. GEORGE: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Le Tap of St. George, Inc. 104 Interstate Drive Saint George, SC 29477 Bankruptcy Case No.: 09-07486 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: David R. Duncan Debtor's Counsel: Felix B. Clayton, Esq. Law Office of Felix B. Clayton P.O. Box 1044 Beaufort, SC 29901 Tel: (843) 379-9363 Fax: (843) 379-9844 Email: butch@butchclaytonlaw.com Estimated Assets: $1,000,001 to $10,000,000 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 Ramesh D. Patel, president of the Company. LEAR CORP: Judge Opens Door to Patent Suit Against Firm ------------------------------------------------------- Law360 reports that a bankruptcy judge has allowed Chamberlain Group Inc. and Johnson Controls Interiors to go ahead with a patent suit over garage door openers against Lear Corp. Chamberlain and JCI asked the Bankruptcy Court to modify the automatic stay to permit them to bring and continue their claims against Debtor Lear Corporation for prepetition and postpetition patent infringement in the U.S. District Court for the Northern District of Illinois. On July 13, 2005, Chamberlain filed a patent infringement action against Lear in the case currently styled as The Chamberlain Group, Inc. and Johnson Controls Interiors LLC v. Lear Corporation, in the Illinois District Court. On August 19, 2009, Chamberlain and Johnson filed an adversary proceeding in the U.S. Bankruptcy Court for the Southern District of New York seeking determination that the infringing technology being used by Lear is not property of its bankruptcy estate; determination and allowance of administrative expense claim as a result of Lear's postpetition infringement; an injunction against Lear's ongoing infringing conduct; and liquidation and allowance of a prepetition claim for money damages caused by Lear's prepetition infringement. Chamberlain and Johnson sought relief from automatic stay to seek in the Illinois Action all relief, other than allowance of their claims and administrative expenses under Sections 502 and 503 of the Bankruptcy Code, that they may be entitled to assert as a result of or in connection with Lear's infringement of the "patents-in-suit." Chamberlain and Johnson assert that "cause" exists because Lear is continuing its infringement of the patents-in-suit. According to Chamberlain and Johnson, the automatic stay does not and should not protect Lear from litigation regarding its postpetition violations of the rights of others. Lear Corp. objected to the proposal, saying it will be prejudiced if it is forced to deal with the Illinois District Court Action at this time, during the critical period of its Chapter 11 cases. About Lear Corp. Lear Corporation -- http://www.lear.com/ -- is one of the world's leading suppliers of automotive seating systems, electrical distribution systems and electronic products. The Company's products are designed, engineered and manufactured by a diverse team of 80,000 employees at 210 facilities in 36 countries. Lear's headquarters are in Southfield, Michigan, and Lear is traded on the New York Stock Exchange under the symbol [LEA]. Outside the United States, Lear has subsidiaries in Germany, Luxembourg, Sweden, Singapore, China, India and Mexico, among others. Lear Corporation and its affiliates filed for Chapter 11 on July 7, 2009 (Bankr. S.D.N.Y. Case No. 09-14326). Affiliates part of the Chapter 11 filing include Lear South Africa Limited, Lear Corporation (Germany) Ltd., Lear Corporation Canada Ltd., Lear Mexican Holdings Corporation, and Lear South American Holdings Corporation. Attorneys at Kirkland & Ellis LLP, serve as the Debtors' bankruptcy counsel. McCarthy Tetrault LLP has been engaged as CCAA counsel. Bodman LLP has been hired as special Michigan counsel. Winston & Strawn LLP and Brooks Kushman P.C. have also been tapped as special counsel. Alvarez & Marsal North America, LLC, is the Debtors' restructuring advisors. Ernst & Young LLP is the Debtors' auditors and tax advisors. Kurtzman Carson Consultants LLC is the Debtors' claims and notice agent. Simpson Thacher & Bartlett LLP represents JP Morgan, as admin. agent for senior secured lenders and DIP lenders. As of May 30, 2009, Lear has assets of $1,270,800,000 against debts of $4,536,000,000. Bankruptcy Creditors' Service, Inc., publishes Lear Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Lear Corp. (http://bankrupt.com/newsstand/or 215/945-7000) LEWIS EQUIPMENT: Taps Munsch Hardt as General Bankruptcy Counsel ---------------------------------------------------------------- Lewis Equipment Company, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the Northern District of Texas for permission to employ Munsch, Hardt, Kopf & Harr as general bankruptcy counsel. Munsch Hardt will, among other things: a. serve as attorneys for the Debtors in all aspects, including any adversary proceedings commenced in connection with the Chapter 11 cases and provide representation and legal advice to the Debtors throughout the Bankruptcy Cases; b. assist the Debtors in carrying out their duties under the Bankruptcy Code, including advising the Debtors of the duties, their obligations, and their legal rights; c. consult with the U.S. Trustee, any statutory committee that may be formed, and all other creditors and parties in interest concerning administration of the Bankruptcy Cases; The hourly rates of Munsch Hardt's personnel are: Shareholders $570 Paralegals $180 The principal attorneys and paraprofessionals designated to represent the Debtors, and their hourly rates, are: Davor Rukavina, shareholder $330 Kathleen M. Patrick, associate $275 Audrey Monlezun, paralegal $180 Munsch Hardt received a $100,000 retainer on the account of Lewis Equiment Company. After the application of fees and expenses, the firm holds, as of the petition date, a $30,552 retainer. To the best of the Debtors' knowledge, Munsch Hardt is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Munsch, Hardt, Kopf & Harr 500 N. Akard Street, Suite 3800 Dallas, TX 75201-6659 Tel: (214) 855-7587 Fax: (214) 978-5359 About Lewis Equipment Company, Inc. Grand Prairie, Texas-based Lewis Equipment Company, Inc., operates a construction business. The Company and its affiliates filed for Chapter 11 on Sept. 18, 2009 (Bankr. N.D. Tex. Case No. 09-45785 to 09-45814). Davor Rukavina, Esq., at Munsch, Hardt, Kopf & Harr represents the Debtors in their restructuring efforts. In their petition, the Debtors listed assets and debts both ranging from $100,000,001 to $500,000,000. LIGHTHOUSE FINANCIAL: Files List of 20 Largest Unsecured Creditors ------------------------------------------------------------------ Lighthouse Financial Group, Inc., and its debtor-affiliates filed with the U.S. Bankruptcy Court for the Middle District of Florida a list of its largest unsecured creditors, disclosing: Entity Claim Amount ------ ------------ Tim Pruban $1,300,000 6585 N. Avondale Chicago, IL 60631 Andrew J. May $994,143 301 Platt Street, Suite 259 Tampa, FL 33606 Colonial Realty Limited Partnership $805,769 P.O. Box 55379 Dept. No. 9425 Birmingham, AL 35255 Tim Pruban, IRA $328,978 6585 N. Avondale Chicago, IL 60631 Tom & Lorraine Poe $275,000 21420 Stratford Avenue Rocky River OH 44116 L.P., a minor child $243,900 by Lucy Pruban, parent G.P., a minor child, $216,000 by Lucy Pruban, parent Gulf Coast Signs of Sarasota, Inc. $200,000 HaackP/S Plan $200,000 Richard and Vanessa Freund $179,167 DM Direct, Inc. $153,478 Christopher Reiser $150,000 Estate of Dorothy Pruban $150,000 Citi Advantage Business Card $148,461 Gene and Karen Pruban $100,000 Hidayet Kutat $100,000 James Silovich trust $100,000 Nancy Rubdgren Trust $80,000 Susan M. Davis, IRA $75,000 Katherine Leska $65,300 About Lighthouse Financial Group Tampa, Florida-based Lighthouse Financial Group, Inc., and its affiliates filed for Chapter 11 on Sept. 14, 2009 (Bankr. M.D. Fla. Case Nos. 09-20530 to 09-20603). In its petition, the Debtor listed assets and debts both ranging from $10,000,001 to $50,000,000. LOCAL INSIGHT: Projected Weak Credit Cues S&P's Junk Ratings ------------------------------------------------------------ Standard & Poor's Ratings Services said it lowered its ratings on Englewood, Colorado-based Local Insight Regatta Holdings Inc. to 'CCC+' from 'B' and removed the ratings from CreditWatch, where they were placed on Sept. 9, 2009. The outlook is negative. At the same time, S&P lowered the issue-level rating on LIRH's senior secured credit facilities to 'B-' (one notch higher than the 'CCC+' corporate credit rating on the company) from 'B+'. The recovery rating on these loans remains a '2', indicating S&P's expectation of substantial (70%-90%) recovery for lenders in the event of a payment default. S&P also lowered its issue-level rating on LIRH's senior subordinated notes to 'CCC-' (two notches lower than the 'CCC+' corporate credit rating) from 'CCC+'. The recovery rating on these securities remains a '6', indicating S&P's expectation of negligible (0%-10%) recovery for lenders in the event of a payment default. "The rating downgrade reflects S&P's belief that credit measures of the consolidated group of Local Insight Media companies will continue to weaken over the intermediate term, as S&P does not expect that EBITDA generation will be sufficient to reduce leverage," said Standard & Poor's credit analyst Ariel Silverberg. This stems from a combination of cyclical, and what S&P believes are secular trends impacting the yellow page directory business. On the cyclical side, pressure on small businesses, including increased bankruptcies, are expected to continue to reduce advertising budgets for the next several quarters. On the secular side, S&P believes that consumer preferences will continue to shift toward online local search tools, and away from print-based directories. S&P believes the digital search market is more highly competitive, and therefore, S&P does not expect any increase in revenue from the sale of digital products will be sufficient to offset print revenue declines over the next several quarters. As a result of these factors, and otwithstanding reductions to LIM's cost structure that management has already achieved, S&P believes that over the rating horizon, credit measures will deteriorate at a more rapid pace than S&P previously expected. The ratings on LIRH are based on the consolidated credit quality of the Local Insight Media family of companies. LIRH is indirectly owned by Local Insight Media Holdings Inc. (Holdings), who also indirectly owns entities that participate in the whole business securitization, consisting of ACS Media (the incumbent yellow page publisher in Alaska), CBD Media (the incumbent yellow page publisher in Cincinnati), and HYP Media (the incumbent yellow page publisher in Hawaii). Holdings is owned in part by certain funds of Welsh, Carson, Anderson & Stowe, and in part by Local Insight Media Holdings, L.P., which in turn is owned by separate WCAS funds, Spectrum Equity Investors, and certain members of management. LIMH is the indirect parent of Caribe Media Inc. (the incumbent yellow page publisher in Puerto Rico and the Dominican Republic). Given the strategic relationships between, and common management and ownership of, the various operating entities, S&P view the rating of each individual entity based on a global view of the creditworthiness of all other entities. S&P expects decisions in support of the owners' operating and financial strategies will be made with a view toward the collective group of companies. S&P believes that the attributes of LIM's markets have helped insulate the company somewhat from experiencing the high-teens, low 20% decline in ad sales that some of the other yellow page publishers have experienced during 2009 (ad sales for the LIM markets in the first half of 2009 were down in the low single- digit percentage area). The relatively positive attributes of the IM markets include their smaller size (which tends to provide for more efficient distribution of the book and therefore greater value to the advertiser), the geographic isolation of several of its markets (which provides somewhat of a barrier to new entrants), and the incumbent positions LIM holds in many of its markets. In addition, given LIM's sales force is nonunionized, it affords the company the ability to better customize sales campaigns to specific regions. S&P believe, however, that in the next several quarters, the impact of negative secular trends will be more pronounced in certain of LIM's larger markets, such as Cincinnati given it is a larger, metro market. Given S&P's belief that cyclical pressure will continue to exacerbate negative secular trends over the next several quarters, S&P's ratings incorporate the expectation that print ad sales, for the consolidated group of LIM companies, will decline in the high- single digit percentage area, and low-teens percentage area in 2010 and 2011, respectively. Given the deferral and amortization nature of revenue recognition (revenue is recognized ratably over the life of a directory, beginning with the month of delivery), ad sales in one period are generally indicative of future revenue. Therefore, S&P's expectation for ad sales would result in revenue declines during 2011 and 2012 of similar magnitudes. S&P expects this will further result in EBITDA declines in the high single- digit and low-teens percentage area in 2011 and 2012, respectively. In turn, it would result in consolidated leverage increasing to the high 9x area and high 10x area by 2011 and 2012, respectively, and interest coverage falling to the mid 1x area and low 1x area in 2011 and 2012, respectively. These measures are in line with the new rating. LPATH INC: Extends ASONEP(TM) Collaboration with Merck Serono ------------------------------------------------------------- Lpath, Inc., reports that September 24, 2009, it has been advised by Merck Serono, a division of Merck KGaA, (Darmstadt, Germany) that Merck Serono has exercised its right to extend the "initial development period," the period during which Lpath is responsible, in close collaboration with Merck Serono, for development of ASONEP(TM). While the ASONEP license agreement provided Merck Serono the right to extend this period to April 28, 2010, the parties agreed upon a revised date of June 27, 2010, to complete the Phase 1 study and various non-clinical studies undertaken to further the development of ASONEP as contemplated in the License Agreement. Lpath will continue to receive the previously agreed upon monthly research and development funding from Merck Serono until April 28, 2010. In addition, Lpath remains eligible to earn development milestone payments during the extension period. Lpath is nearing completion of its ASONEP Phase 1 clinical trial in cancer patients. The drug candidate was well tolerated at all tested dose levels, and there have been no drug-related Serious Adverse Events reported. Lpath expects to complete enrollment in its Phase I trial within a few weeks, but dosing of these patients may continue for several months. In a September 24 press statement, Scott Pancoast, Lpath's CEO, commented: "We expect the additional insights gleaned from the remaining Phase I patients and the extended collaboration will be extremely valuable in designing Phase 2 clinical trials for ASONEP. We continue to work hand-in-hand with Merck Serono in a collaborative effort to advance the ASONEP program to the next level." About Lpath San Diego-based Lpath, Inc. (OTC BB: LPTN) -- http://www.Lpath.com/-- is a biotechnology company focused on the discovery and development of lipidomic-based therapeutics. Lipidomics is an emerging field of medical science whereby bioactive signaling lipids are targeted to treat important human diseases. As of June 30, 2009, the Company had total assets of $7,027,751 and total liabilities of $12,457,882, resulting in stockholders' deficit of $5,430,131. As of June 30, 2009, Lpath had an accumulated deficit of approximately $39.8 million. Lpath has incurred significant net losses since its inception. Lpath expects its operating losses to increase for the next several years as it pursues the clinical development of its product candidates. In the six months ended June 30, 2009, Lpath incurred an operating loss and utilized net cash in operating activities of $323,642 and $2,055,719, respectively. In the year ended December 31, 2008, the company incurred an operating loss and utilized net cash in operating activities of $11,735,235 and $6,192,041, respectively. Lpath said these conditions raise substantial doubt about the company's ability to continue as a going concern. LYONDELL CHEMICAL: Trustee Joins Calls for Chapter 11 Examiner -------------------------------------------------------------- The U.S. trustee in Lyondell Chemical Co.'s bankruptcy proceedings has backed up the official committee of unsecured creditors in its call to appoint an examiner in the Chapter 11 cases. The Creditors Committee has asked the Bankruptcy Court to order the appointment of an examiner to investigate whether Len Blavatnik and lenders from the chemical maker's 2007 buyout are unfairly influencing its bankruptcy. The Creditors Committee asserts that Lyondell needs an independent examiner because Blavatnik, chairman of Access Industries Holding LLC, still controls the Company. The examiner, according to the panel, should probe why the Company wouldn't refinance its $8 billion bankruptcy loan, and how Mr. Blavatnik and lenders who worked with him in 2005 will also fund a rights offering that includes a "forced settlement" of the creditors' lawsuit against them. Meanwhile, the hearing that had been scheduled for Oct. 14 to approve the disclosure statement explaining the Plan was moved to Nov. 4. Creditors cannot vote on the plan until the explanatory disclosure statement is approved. The Creditors Committee has already commenced a lawsuit against Citibank N.A., Deutsche Bank, and other banks that funded the 2007 acquisition of Lyondell Chemical Company by Basell AF S.C.A. Having accumulated heavy debt because of the merger, LyondellBasell was in a full-blown liquidity crisis and was running out of money to fund its operations only three months following the merger. The Creditors Committee asserted claims of, among other things, fraudulent transfer, breach of fiduciary duty, avoidance of unperfected senior liens. U.S. Bankruptcy Judge Robert Gerber will hear the examiner request on Oct. 14. The Company's disclosure statement to its reorganization plan must be approved by Oct. 15 in order for the company to keep current terms of its $8 billion loan, creditors noted. Noteholders led by the Bank of New York Mellon and Bank of New York Mellon Trust Company, as indenture trustees, have asked the Bankruptcy Court to compel Lyondell Chemical Co. to refinance the secured lending package that matures Dec. 15, two weeks before commencement of a trial where the Creditors Committee is attempting to void the lenders' security interests based on a theory that the 2007 leveraged buyout amounted to a fraudulent transfer. BNY, the indenture trustee for the 8.375 percent senior notes, has also filed a separate lawsuit against the secured lenders, arguing that it suffered unique damages because the LBO violated covenants in the senior note indenture and also violated an inter-creditor agreement. 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 US$8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a US$6.5 billion term loan, which comprises a US$3.25 billion in new loans and a US$3.25 billion roll-up of existing loans; and a US$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) MACLOVIO MARTINEZ: Case Summary & 3 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Maclovio C. Martinez dba Ademar Construction dba El Hornito 12632 East Frontage Road Longmont, CO 80504 Bankruptcy Case No.: 09-31045 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Elizabeth E. Brown Debtor's Counsel: Aaron A. Garber, Esq. 303 E. 17th Ave., Suite 500 Denver, CO 80203 Tel: (303) 832-2400 Email: aag@kutnerlaw.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 3 largest unsecured creditors is available for free at: http://bankrupt.com/misc/cob09-31045.pdf The petition was signed by Mr. Martinez. MARGAUX WESTOVER: Case Summary & 17 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Margaux Westover Partners, Ltd. 14900 Landmark Blvd., Suite 610 Dallas, TX 75254 Case No.: 09-46378 Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. ------ -------- North Partners, Ltd. 09-46379 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of Texas (Ft. Worth) Judge D. Michael Lynn Debtor's Counsel: Vickie L. Driver, Esq. Pronske & Patel, P.C. 2200 Ross Avenue, Suite 5350 Dallas, TX 75201 Tel: (214) 658-6500 Fax: (214) 658-6509 Email: vdriver@pronskepatel.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Donald L. Silverman, the company's president. Margaux Westover Partners' List of 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Margaux Texas Ventures Reimbursements $123,859 AECOM USA, Inc. Civil Engineering $104,161 Party City Tenant Improvements $75,000 Archstone Dental Tenant Improvements $52,200 Today Realty Advisors Management Fee $27,000 Falcon Development & Construction $12,018 Construction Management Chiodini Associates Architect $6,564 TXU Energy Utility $4,810 Gambit Realty, Inc. Leasing Commissions $4,049 The Retail Connection, LP Leasing Commissions $3,915 Alliance Geotechnical Group, Engineering $3,915 Inc. MDC Services Corporation Reimbursements $3,346 Hal Construction LLC Landscaper $635 AT&T Utility $474 Corner Real Estate Services Reimbursement for $183 Inc. September Payroll, Copies and Po Commonwealth Title of Dallas Endorsement for $50 Bank Draw Bill Kinard Mileage Reimbursement $37 MERISANT WORLDWIDE: Seeks Approval of Newport Global Agreements --------------------------------------------------------------- Merisant Worldwide Inc. asks the Bankruptcy Court for approval of agreements with Newport Global Advisors LP. Pursuant to a backstop commitment and stock purchase agreement, Newport has agreed to provide at least $10 million which will be available to pay down secured bank debt when its reorganization plan is effective. Under the plan, Newport will purchase $7.5 million in convertible preferred stock and backstop $2.5 million out of a $5 million in a rights offering. Merisant will be seeking approval of the Newport Agreements and the disclosure statement explaining its Plan on October 19. The Plan accomplishes a deleveraging of the Debtors' capital structure by removing approximately $400 million in indebtedness, including approximately $45 million of secured indebtedness, from the Debtors' balance sheet. Under the Plan, holders of bank claims aggregating $205 million will recover 100% of their claims in the form of new notes, cash and majority of the preferred stock. Holders of unsecured claims aggregating $235.3 million against Merisant Company will recover 5.5% in the form of new common stock of Reorganized Merisant and may participate in the rights offering. Holders of unsecured trade claims will receive payment of 60% of the claim in cash. Holders of unsecured claims aggregating $137.1 million against Merisant Worldwide will receive distributions in the form of "contingent value rights" if they vote in favor of the Plan. Merisant's Chapter 11 plan is supported by the Official Committee of Unsecured Cerditors and Wayzata Investment Partners, which controls two-thirds aggregate principal amount of loans outstanding under Merisant Company's amended and restated credit facility as well as a majority of the aggregate principal amount of Merisant Company's 9.5% Senior Subordinated Notes due 2013. Merisant anticipates that it will be able to obtain Bankruptcy Court confirmation of the Plan and emerge from bankruptcy as early as January 1, 2010. 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. MICHAEL WRAY: Files for Chapter 11 Bankruptcy Protection -------------------------------------------------------- Michael Wray has filed for Chapter 11 bankruptcy protection. Mike Copeland at Tribune-Herald reports that Mr. Wray reportedly owes more than $30,000 in back lease payments on the Square Bar & Kitchen he was operating on the first floor of the Flats. Tribune-Herald says that State District Judge Matt Johnson signed a temporary restraining order forbidding Mr. Wray from removing any furnishings and fixtures from the bar. Tribune-Herald states that the Square Bar & Kitchen at South Third Street and Austin Avenue is closed, and a sign posted on the front says the door locks have been changed and will remain that way until Mr. Wray makes good on back lease payments. Michael Wray resigned as general partner of the Austin Avenue Flats project in downtown Waco in July 2009. MIDWEST HOTEL: Case Summary & 2 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Midwest Hotel Developers, LLC 1580 S. Hamilton Circle Olathe, KS 66061 Bankruptcy Case No.: 09-23348 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court District of Kansas (Kansas City) Judge: Dale L. Somers Debtor's Counsel: Neil S. Sader, Esq. The Sader Law Firm, LLC 4739 Belleview, Suite 300 Kansas City, MO 64112-1364 Tel: (816) 561-1818 Fax: (816) 561-0818 Email: nsader@saderlawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $3,221,042, and total debts of $4,956,072. A full-text copy of the Debtor's petition, including a list of its 2 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ksb09-23348.pdf The petition was signed by Shaunak Patel, authorized officer of the Company. MOSHE SEGEV: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Joint Debtors: Moshe Segev Michelle M. Cohen 6067 Calmfield Avenue Agoura Hills, CA 91301 Bankruptcy Case No.: 09-23222 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Central District of California (San Fernando Valley) Judge: Geraldine Mund Debtors' Counsel: Michael Jay Berger, Esq. 9454 Wilshire Blvd 6th Flr Beverly Hills, CA 90212-2929 Tel: (310) 271-6223 Fax: (310) 271-9805 Email: michael.berger@bankruptcypower.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/cacb09-23222.pdf The petition was signed by the Joint Debtors. NATIONAL DATACOMPUTER: Berens Resigns; Bucacci Assumes CEO Post --------------------------------------------------------------- The Board of Directors of National Datacomputer, Inc., accepted the resignation of William B. Berens as Director, President and Chief Executive Officer of the Company, effective September 29, 2009. Mr. Berens indicated that his resignation was due to a personal decision to pursue other interests and was not the result of any disagreements with the Company's management or Board of Directors. Also on September 29, 2009, the Board of Directors appointed Bruna Bucacci as the Company's President and Chief Executive Officer. Ms. Bucacci was also appointed as a Director of the Company. These appointments were effective as of September 29. Ms. Bucacci has served as the Company's Chief Operating Officer since March 2007 and Chief Accounting Officer since November 2005. Ms. Bucacci joined the Company in May 1996 as Controller. Prior to joining the Company, Ms. Bucacci was Corporate Controller for Thermedics Detection, Inc. and held various managerial positions for Thermo Electron, Inc. Ms. Bucacci is a graduate of Boston College where she received a BS degree in Mathematics and a graduate of Bentley College where she received a BS degree in Accounting. Founded in 1986, Billerica, Massachusetts-based National Datacomputer, Inc. (OTC Bulletin Board: NDCP) markets, sells, and services computerized systems used to automate the collection, processing and communication of information related to product sales and distribution. The Company's products and services include data communication networks, application-specific software, hand-held computers and related peripherals, as well as associated training and support services. As of June 30, 2009, the Company had $523,879 in total assets and $1,552,176 in total liabilities, resulting in $1,028,297 stockholders' deficit. The Company has an accumulated deficit of roughly $17,100,000 through June 30, 2009. As a result of the Company's deficit and cash position, the report of its independent registered public accounting firm relating to the financial statements as of and for the year ended December 31, 2008, contains an explanatory paragraph regarding substantial doubt about the Company's ability to continue as a going concern. As of June 30, 2009, the Company had $191,000 in cash and negative working capital of $768,000. The Company said in the event that it cannot generate sufficient cash for working capital, it may have to reduce its level of operations, which will make it more difficult for the Company to continue its business as a going concern. The Company continues exploring all opportunities to improve its financial condition by pursuing potential revenues sources through increased marketing efforts. The Company warned there is a possibility that it may not realize adequate revenues in the near future to meet cash flow requirements, and therefore might require it to implement further cost saving actions or attempt to obtain additional financing. The Company believes that based on current revenue expectations, the expected timing of such revenues, and its current level of expenses the Company has sufficient cash to fund operations through the end of 2009. There can be no assurance that such financing, if required, will be available on reasonable terms, if at all. NATIONAL PROCESSING: S&P Raises Corporate Credit Rating to 'B' -------------------------------------------------------------- Standard & Poor's Ratings Services said it raised its corporate credit rating on Louisville, Kentucky-based National Processing Co. Group Inc. to 'B' from 'B-'. S&P has also removed all the ratings from CreditWatch with developing implications, where they were placed on Sept. 14, 2009. The outlook is stable. At the same time, S&P raised the issue-level ratings on NPC's senior secured term loan and revolver to 'B+' (one notch above the corporate credit rating on the company) from 'B'. The recovery rating on the debt remains unchanged at '2', indicating expectations for substantial (70%-90%) recovery in the event of payment default. S&P also raised the issue-level rating on NPC's second-lien term loan one notch to 'CCC+' (two notches below that corporate credit rating) from 'CCC'. The recovery rating on the loan remains unchanged at '6', indicating expectations for negligible (0%-10%) recovery in the event of a payment default. "The upgrade reflects NPC's improved liquidity profile following the recent amendment of its senior secured credit facility, which, among other things, revised required financial maintenance covenant ratios to provide greater headroom," said Standard & Poor's credit analyst Susan Madison. Prior to the amendment, headroom under the covenants was minimal, and the required ratios stepped down sharply at Dec. 31, 2009. The revised covenant ratios are sufficient to withstand a 15% decline from the current latest-12-month EBITDA levels over the next year. "Despite S&P's expectations for lower transaction volumes and increased merchant attrition rates over the next year to due weak economic conditions," added Ms. Madison, "we believe NPC will be able to moderate the impact of these trends on revenue and EBITDA through merchant price increases, new product revenues, and lower processing costs." Furthermore, NPC generates modest discretionary cash due to low working capital and capital expenditure requirements, which it could use to pay down debt, further strengthening the company's credit profile. NBC ACQUISITION: Moody's Gives Stable Outlook; Affirms 'B1' Rating ------------------------------------------------------------------ Moody's Investors Service revised NBC Acquisition Corp (parent company of Nebraska Book Company) rating outlook to stable from negative. All other ratings were affirmed. The revision of the rating outlook to stable from negative reflects the closing of (a) a new $200 million senior secured note which is due in December, 2011 and (b) a new $75 million asset based revolver that will effectively expire in September, 2011 absent a refinancing or other extention of the senior secured notes. The affirmation of NBC's B3 Corporate Family Rating reflects its highly leveraged capital structure, competition in the textbook market, and the significant seasonality of the company's business. The ratings also take into consideration the relatively stable demand for used and new college textbooks and the company's high share of the used textbook market. While the recently closed revolver and senior secured notes addressed near term maturities, the company will still face significant refinancing requirements in late 2011. These ratings were affirmed: Nebraska Book Company * $200 million senior secured notes due December 2011 at B1 (LGD 2, 25%) * $175 million Senior Subordinated Notes due March 2012 at Caa1 (LGD 5, 70%) NBC Acquisition Corporation * Corporate Family Rating at B3 * Probability of Default Rating at B3 * $77 million Sr. Discount Debentures due 2013 at Caa2 (LGD 6, 94%) Moody's last rating action on NBC Acquisition Corporation was on September 21, 2009, when a B1 rating was assigned to the company's proposed senior secured notes due December 2011. NBC Acquisition Corp., headquartered in Lincoln, Nebraska, is a holding company whose sole asset is Nebraska Book Company, Inc. Nebraska Book Company, Inc., is a leading wholesaler of used textbooks and operates approximately 275 college bookstores across the United States. Revenues for the LTM period ended June 30, 2009, were approximately $608 million. NEWPAGE CORP: Completes $1.7BB 11.375% Sr. Secured Notes Offering ----------------------------------------------------------------- NewPage Corporation said it completed on September 30, 2009, its private placement offering of $1.7 billion in aggregate principal amount of 11.375% Senior Secured Notes due 2014. The net proceeds of the Notes Offering, together with approximately $5 million of borrowings under NewPage's revolving credit facility, were used to repay all amounts outstanding under NewPage's term loan and to pay fees and expenses of the Notes Offering. The Notes were issued under an Indenture among the Company, the guarantors party thereto and The Bank of New York Mellon, as trustee. Interest is payable semi-annually on December 31 and June 30 of each year, beginning on December 31, 2009. The Notes mature on the earlier of (i) December 31, 2014 or (ii) the date that is 31 days prior to the maturity date of (a) any existing second lien notes then outstanding, (b) any existing senior subordinated notes then outstanding, (c) any NewPage Holding Corporation notes then outstanding or (d) any refinancing of any indebtedness included in items (a), (b) or (c) above. At any time on or after March 31, 2012, the Company may redeem some or all of the Notes at specified redemption prices, plus accrued and unpaid interest and special interest, if any, to the redemption date. In addition, at any time prior to March 31, 2012, the Company may, on one or more occasions, redeem some or all of the Notes at a redemption price equal to 100% of the principal amount of the Notes redeemed, plus a "make-whole" premium as of, and accrued and unpaid interest and special interest, if any, to, the applicable redemption date. At any time before March 31, 2012, the Company may, on one or more occasions, redeem up to 35% of the outstanding aggregate principal amount of the Notes with the net cash proceeds of one or more qualified public equity offerings at 111.375% of the principal amount of the Notes plus accrued and unpaid interest and special interest, if any, to the redemption date. At any time prior to March 31, 2012, but not more than once in any 12-month period, the Company may redeem up to 10% of the original aggregate principal amount of the Notes at a redemption price of 103%, plus accrued and unpaid interest and special interest, if any, to the redemption date, subject to certain rights of holders of the Notes. Upon a change of control of the Company, each holder of Notes may require the Company to repurchase all or any part of that holder's Notes for a payment equal to 101% of the aggregate principal amount of the Notes repurchased plus accrued and unpaid interest and special interest, if any, to the date of repurchase. The Notes are guaranteed by all of the Company's domestic restricted subsidiaries and NewPage Port Hawkesbury Corp., a Canadian entity. The Notes are secured on a first-priority basis by substantially all of the Company's, the Company's domestic restricted subsidiaries' and NewPage Port Hawkesbury Corp.'s present and future property and assets, other than cash, deposit accounts, accounts receivables, inventory, the capital stock of the Company's subsidiaries and intercompany debt. The Notes are secured on a second-priority basis by substantially all of the Company's, the Company's domestic restricted subsidiaries' and NewPage Port Hawkesbury Corp.'s present and future cash, deposit accounts, accounts receivables and inventory. The Indenture, among other things, limits the Company's ability and the ability of its restricted subsidiaries to: incur additional indebtedness or issue disqualified stock or preferred stock; create liens; pay dividends or make other sorts of restricted payments; make investments; sell assets; consolidate, merge, sell or otherwise dispose of all or substantially all of the Company's assets; enter into transactions with the Company's affiliates; and designate the Company's subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of exceptions, which are described in the Indenture. In connection with the Notes Offering, the Company entered into an Exchange and Registration Rights Agreement, dated September 30, 2009, among the Company and Credit Suisse Securities (USA) LLC, Goldman, Sachs & Co. and Citigroup Global Markets Inc., as representatives of the initial purchasers of the Notes. Pursuant to the Registration Rights Agreement, the Company has agreed to file a registration statement as soon as practicable, but no later than 120 days after September 30, 2009 relating to an offer to exchange the Notes for debt securities issued by the Company which are substantially identical in all material respect to the Notes, to use all commercially reasonable efforts to cause such registration statement to be declared effective by the Securities and Exchange Commission as soon as reasonably practicable, but no later than 210 days after September 30, 2009, to use all commercially reasonable efforts to commence the exchange offer promptly, but no later than 45 business days after such registration statement has become effective, and to hold the exchange offer open for at least 20 business days. If the Company fails to satisfy these obligations, subject to certain exceptions, special interest will accrue and be payable with respect to the Notes. The Notes offered by NewPage in the Notes Offering have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The Notes were offered only to qualified institutional buyers under Rule 144A and outside the United States in compliance with Regulation S under the Securities Act. About NewPage Headquartered in Miamisburg, Ohio, NewPage Corporation is the largest coated paper manufacturer in North America, based on production capacity, with $4.4 billion in net sales for the year ended December 31, 2008. The Company's product portfolio is the broadest in North America and includes coated freesheet, coated groundwood, supercalendered, newsprint and specialty papers. The papers are used for corporate collateral, commercial printing, magazines, catalogs, books, coupons, inserts, newspapers, packaging applications and direct mail advertising. NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada. The mills have a total annual production capacity of roughly 4.4 million tons of paper, including roughly 3.2 million tons of coated paper, roughly 1.0 million tons of uncoated paper and roughly 200,000 tons of specialty paper. As of June 30, 2009, NewPage Holding had $4.141 billion in total assets; and total current liabilities of $475 million, long-term debt of $3.145 billion, and other long-term obligations of $618 million; resulting in $97 million total deficit. As of June 30, 2009, NewPage Corp. had $4.140 billion in total assets; and total current liabilities of $475 million, long-term debt of $2.953 billion, and other long-term obligations of $618 million; resulting in $94 million total deficit. As reported by the Troubled Company Reporter on October 7, 2009, Standard & Poor's Ratings Services raised its corporate credit rating on NewPage Corp. to 'CCC+' from 'SD' (selective default). The outlook is negative. S&P raised the issue-level rating on the company's second-lien floating- and fixed-rate notes due 2012 to 'CCC-' (two notches below the corporate credit rating) from 'D'. The recovery rating on these notes remains at '6', indicating S&P's expectation of negligible (0% to 10%) recovery in the event of a payment default. S&P also raised the issue-level rating on the company's subordinated notes to 'CCC-' from 'CC'. The recovery rating is unchanged at '6', indicating S&P's expectation of negligible (0% to 10%) recovery in the event of a payment default. NEXT 1: Posts $985,000 Net Loss in First Quarter Ended May 31 ------------------------------------------------------------- Next 1 Interactive, Inc., reported a net loss of $985,031 on total revenues of $191,415 for the first quarter ended May 31, 2009, compared with a net loss of $576,496 on total revenues of $780,442 in the corresponding period ended May 31, 2008. The Company attributed the decrease in total revenues from 2008 to 2009 to a general decline in the travel and leisure industry. At May 31, 2009, the Company's consolidated balance sheet showed $8,114,625 in total assets, $2,747,683 in total liabilities, and $5,366,942 in total stockholders' equity. The Company's consolidated balance sheet also showed strained liquidity with $229,631 in total current assets available to pay $2,069,486 in total current liabilities. Full-text copies of the Company's consolidated financial statements for the three months ended May 31, 2009, are available for free at http://researcharchives.com/t/s?4688 Going Concern Doubt As reported in the Troubled Company Reporter on July 1, 2009, Kramer, Weisman and Associates, LLP, in Davie, Florida, expressed substantial doubt about Next 1 Interactive, Inc.'s ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended February 28, 2009. The auditing firm said that the Company had an accumulated deficit of $6,081,214 and a working capital deficit of $1,582,950 at February 28, 2009, net losses for the year ended February 28, 2009, of $1,843,567 and cash used in operations during the year ended February 28, 2009, of $1,704,195. About Next 1 Based in Weston, Florida, Next 1 Interactive, Inc. -- http://www.n1ii.com/-- is an emerging interactive media company whose focus is in video and rich media advertising delivered over internet and television platforms. The Company addresses advertisers' needs to provide compelling content in the emerging convergent landscape of Internet, television and mobile platforms. Next 1 Interactive accomplishes this goal by the synergistic strength of its companies and media channels. Since inception, the Company has been focused on the travel industry solely through the Internet. The Company has changed its current business model from a company that generates nearly all of its revenues from its travel divisions to a media company focusing on Interactive Media advertising platforms utilizing the Internet, Internet Radio and Cable Television. NORTEL NETWORKS: Ciena Signs $521MM Deal to Buy Ethernet Assets --------------------------------------------------------------- Ciena(R) Corporation, the network specialist, on October 7 announced that it has entered into agreements with Nortel to purchase substantially all of the optical networking and carrier Ethernet assets of Nortel's Metro Ethernet Networks (MEN) business for $390 million in cash and 10 million shares of Ciena common stock. The product and technology assets to be acquired include Nortel's long-haul optical transport portfolio; metro optical Ethernet switching and transport solutions; Ethernet transport, aggregation and switching technology; multiservice SONET/SDH product families; and network management software products. The proposed transaction would strengthen Ciena's global presence and bring together complementary technologies in switching and transport that will offer customers a practical path for transitioning to automated, optical Ethernet-based networking. Based on the closing price of Ciena's stock on Tuesday, October 6, 2009, the aggregate value of the shares to be issued by Ciena is approximately $131 million, bringing the value of the consideration to approximately $521 million. The assets to be acquired generated approximately $1.36 billion in revenue for Nortel in 2008 and $556 million (unaudited) in the first six months of 2009. "This is a unique and exciting opportunity for us to accelerate our existing strategy and the pace of our growth plans by two to three years," said Gary Smith, Ciena's CEO and president. "We believe this transaction will position us for faster growth by giving us greater geographic reach, broader customer relationships and a deeper portfolio of solutions. We believe we are best positioned to leverage these assets, thereby creating a significant challenger to traditional network vendors." He continued: "We have tremendous respect for the talented people at Nortel and for their track record of innovation, and we look forward to the opportunity to build on our existing presence in Canada, where we have operated an R&D center of excellence since 2003. Should the transaction be completed, we will be disciplined in integrating the acquired assets on an aggressive timeframe. We will draw from the best in our respective organizations, cultures and expertise to ensure that we deliver continuity of supply and innovation for our customers and meet shareholder expectations." Ciena is expected to make employment offers to at least 2,000 Nortel employees to become part of Ciena's global team of network specialists. The proposed acquisition would significantly enhance Ciena's existing Canadian-based development resources, making Ottawa the company's largest product and development center. Ciena currently has development facilities in Alpharetta, Georgia; Linthicum, Maryland; Ottawa, Ontario; San Jose, California; Spokane, Washington; and Gurgaon, India. As of July 31, 2009, the end of its fiscal third quarter, Ciena employed 2,110 employees globally. Given the structure of the transaction as an asset carve-out, Ciena expects to incur integration-related costs of approximately $180 million. Based on current expectations of deal timing, Ciena anticipates that the majority of the integration-related costs will be incurred in 2010 and expects the transaction to be significantly accretive to Ciena's results of operations in fiscal 2011. As a result of Nortel's restructuring process, the transaction is subject to a competitive bidding process and requires the approval of the United States Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice. Ciena expects hearings before those courts to approve bidding procedures, break-up fee and expense reimbursement will be held within the next several weeks, followed by a bid period and a potential auction, with final sale hearings to be held thereafter. In the Europe, Middle East and Africa (EMEA) region, Ciena has entered into an agreement with the Joint Administrators, on behalf of the Nortel EMEA entities participating in the transaction for which they have been appointed, and where applicable, the transaction is subject to statutory information-sharing and consultation processes with the relevant employee representatives, as well as approval of the court in Israel. The transaction is also subject to customary closing conditions, including receipt of necessary regulatory approvals. Deutsche Bank Securities Inc. and Foros Securities LLC served as financial advisors to Ciena on this transaction. About Ciena Corp. Ciena Corp. (NASDAQ: CIEN) specializes in practical network transition. We offer leading network infrastructure solutions, intelligent software and a comprehensive services practice to help our customers use their networks to fundamentally change the way they compete. With a global presence, Ciena leverages its heritage of practical innovation to deliver maximum performance and economic value in communications networks worldwide. We routinely post recent news, financial results and other important announcements and information about Ciena on our website. For more information, visit www.ciena.com. NORTEL NETWORKS: Has Interim Resolution With IRS on $3BB Tax Claim ------------------------------------------------------------------ Steven Church at Bloomberg News reports that Nortel Networks Corp. and the U.S. tax officials resolved a $3 billion bill from the Internal Revenue Service, according to a court filing by Nortel. Details of the settlement were not yet disclosed but Nortel said that in an agenda for a court hearing next week that it had come to "an interim resolution" that it would detail on Oct. 13. According to Bloomberg, Nortel also said in a related court filing the IRS agreed not to try to hold Avaya Inc. responsible for any of Nortel's unpaid taxes. Avaya is buying Nortel's telephone- service unit for $915 million. As reported by the TCR on Oct. 1, 2009, Bankruptcy Judge Kevin Gross will convene a hearing on October 13 on the $3 billion tax claim submitted by the IRS against Nortel. According to Bloomberg, the tax claim was filed last month, weeks before Nortel held an auction to sell its telephone-service unit. The action forced the Toronto-based company, once the largest maker of telecommunications equipment, to rewrite part of the $915 million sale contract with the winning bidder, Avaya Inc. In a court filing, Nortel Networks asked the Bankruptcy Court to disallow a $3,016,650,830 tax claim asserted by the Internal Revenue Service. The $3 billion Claim consists of $1,804,637,586 in unsecured priority claim against Nortel Networks Inc. for income taxes for the tax years 1998 to 2007; accrued interest on the income taxes as of the Petition Date in the sum of $1,162,748,632; and an unsecured non-priority claim for penalties to date for $49,264,612. The Claim has been recorded in the Debtors' claim list as Claim No. 1935. Ann Cordo, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, Delaware, argues that Claim No. 1935 must be disallowed in full as the IRS has yet to explain the basis for it. "IRS overstates the amount of income of [NNI and its subsidiaries] that could be subject to U.S. federal income tax, and thus erroneously asserts a claim for income tax due," Ms. Cordo contends. She maintains that NNI's financial records show that there is no "reasonable or realistic basis" for the amount the IRS seeks. About Nortel Networks Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/-- delivers communications capabilities that make the promise of Business Made Simple a reality for our customers. Our next- generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young has been appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor also sought recognition of the CCAA Proceedings in the Bankruptcy Court under Chapter 15 of the Bankruptcy Code. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Chapter 15 case is Bankr. D. Del. Case No. 09-10164. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. Certain of Nortel's European subsidiaries have also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NORTHEAST NEUROSURGERY LLC: Voluntary Chapter 11 Case Summary ------------------------------------------------------------- Debtor: Northeast Neurosurgery, LLC 63 Shaker Road, Suite 201 Albany, NY 12204 Bankruptcy Case No.: 09-13749 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Northern District of New York (Albany) Debtor's Counsel: Richard Croak, Esq. 314 Great Oaks Blvd Albany, NY 12203 Tel: (518) 690-4410 Fax: (518) 690-4435 Email: richardcroak@richardcroak.com Estimated Assets: $0 to $50,000 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 Deborah Hrustich MD, president of the Company. NOVA CHEMICALS: S&P Puts 'B-' Ratings on CreditWatch Positive ------------------------------------------------------------- Standard & Poor's Ratings Services said it placed its ratings, including its 'B-' long-term corporate credit rating, on commodity chemical producer NOVA Chemicals Corp. on CreditWatch with positive implications. "The CreditWatch placement reflects S&P's view that, if successful, the proposed debt issuance will significantly reduce the amount of debt the company will need to refinance by the end first-quarter 2010," said Standard & Poor's credit analyst Jatinder Mall. The ratings on NOVA Chemicals reflect what Standard & Poor's views as the company's highly leveraged capital structure, upcoming large debt maturity, exposure to volatile commodity chemicals, and weak styrene business. These weaknesses are counterbalanced in S&P's opinion by NOVA Chemicals' cost-competitive olefins/polyolefins business, which generates good cash flow through the cycle, and the one-notch increase in the corporate credit rating on the company based on parental support from International Petroleum Investment Co. (AA/Stable/A-1+). NOVA Chemicals produces commodity chemicals and plastics used in consumer, industrial, and packaging products. The company has an annual production capacity of 6,600 million pounds of ethylene and 3,620 million pounds of polyethylene. It also produces a small amount of performance styrenics, which includes expandable polystyrene and styrenic polymer performance products. Nova Chemicals' Ineos Nova joint venture produces styrene monomer and solid polystyrene in North America and Europe. S&P's ratings on NOVA Chemicals factor in the one-notch upgrade for IPIC ownership. The company is the only 100%-owned company in the IPIC investment portfolio. The strategic importance of NOVA Chemicals is evident from IPIC's long-term strategy of developing investments in the petrochemical industry and potential for sharing technologies among other chemical companies in its investment portfolio. IPIC has demonstrated its support of NOVA Chemicals by helping it pay April 2009 bonds with a US$150 million backstop facility, which was converted into equity in July; at that same time, IPIC also converted an additional US$200 million credit facility into equity. Standard & Poor's will likely resolve this CreditWatch once NOVA Chemicals has successfully refinanced the upcoming debt maturities. PARKLANE INC: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Parklane, Inc. 7 Broad Avenue, Suite 305-A Palisades Park, NJ 07650 Bankruptcy Case No.: 09-36812 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court District of New Jersey (Newark) Debtor's Counsel: John Sywilok, Esq. Godlesky & Sywilok 51 Main Street Hackensack, NJ 07601 Tel: (201) 487-9390 Email: sywilokattorney@sywilok.com Estimated Assets: $0 to $50,000 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. The petition was signed by Chun Sik Pak, president of the Company. PARMALAT SPA: Bondi to Appeal Dismissal of Suit vs. Grant, Banks ---------------------------------------------------------------- Judge Lewis A. Kaplan of the U.S. District Court for the Southern District of New York granted defendants Grant Thornton International, Grant Thornton LLP, and Bank of America Corporation, et al.'s request for summary judgment and for dismissal, with prejudice, pursuant to the in pari delicto defense, of all claims asserted against Grant Thornton and BofA by Plaintiffs Dr. Enrico Bondi and Parmalat Capital Finance Ltd. Judge Kaplan related in his 45-page opinion dated September 18, 2009, that there is no dispute that Parmalat Finanziaria, S.p.A., Parmalat S.p.A., their affiliates and PCFL officers engaged in a massive fraud that ended in the collapse of Parmalat. The allegedly dishonest Parmalat and PCFL officers were doing corporate business in obtaining financing from BofA and in providing fraudulent financial statements to auditors and others, Judge Kaplan noted. Whether and to what extent they also stole or embezzled money from their corporations for their own benefit if therefore of no consequence for purposes of the in pari delicto defense except to the extent, if any, that there is evidence of culpable participation by defendants in those thefts, he further pointed out. Judge Kaplan held that the Plaintiffs are incorrect in contending that the Court must look primarily to the intent of the agents while ignoring or discounting evidence that the agents acted for the benefit of the company. Judge Kaplan related that Dr. Bondi and PCFL rely for their proposition that Parmalat insiders stole from the company on a report by the Guardia di Finanza that concluded that more than EUR943 million was "diverted" from Parmalat between 1992 and 2003. But, Judge Kaplan noted, Guardia officer Pietro Curia testified that the definition of "diversion" used in the report included money paid to Parmalat subsidiaries to cover their debt. Thus, Judge Kaplan opined, the Guardia Report, even if it were admissible, would not support the Plaintiffs' contention that corrupt insiders stole the EUR943 million or used it in some other way for their personal benefit and against the interests of Parmalat. "The report, of course, is hearsay -- an out of court statement offered to prove the truth of the matters asserted," Judge Kaplan said. "It is admissible only if plaintiffs have offered sufficient evidence to bring it within an exception to the hearsay rule," he maintained. Accordingly, Judge Kaplan granted GTI and BofA's Summary Judgment Motion dismissing the complaints. A full-text copy of Judge Kaplan's Opinion is available for free at http://bankrupt.com/misc/Parmalat_Order_BofA_SJ_091809.pdf Judge Kaplan vacated the September 18 Opinion, and entered a revised one to correct certain language, including footnotes. A full-text copy of the corrected opinion is available for free at http://bankrupt.com/misc/Parmalat_Order_BofA_SJ_092109.pdf Parmalat's Response Parmalat, however, believes that Judge Kaplan's decision to grant the Summary Judgment Motion is erroneous, and intends to appeal that decision, a company statement revealed. About Parmalat S.p.A. Headquartered in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/-- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. The Company's U.S. operations filed for Chapter 11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represent the Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on December 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court has declared the units insolvent. On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No. 04-14268, in the United States Bankruptcy Court for the Southern District of New York. Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and Food Holdings are Cayman Island special-purpose vehicles established by Parmalat S.p.A. The Finance Companies are under separate winding up petitions before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as Joint Provisional Liquidators in the cases. On January 20, 2004, the Liquidators filed Sec. 304 petition, Case No. 04-10362, in the United States Bankruptcy Court for the Southern District of New York. In May 2006, the Cayman Island Court appointed Messrs. MacRae and Cleaver as Joint Official Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presided over the Parmalat Debtors' U.S. cases. On June 21, 2007, the U.S. Court granted Parmalat permanent injunction. PARMALAT SPA: Completes $100 Mil. Settlement With BofA ------------------------------------------------------ Parmalat S.p.A. said in a press release dated October 5, 2009, that its settlement with Bank of America was completed with BofA's payment of $100 million. One of the conditions set for the consummation of the Settlement is the entry of the U.S. District Court for the Southern District of New York of a "Good Faith Order." The Settlement provides that it is conditioned on the entry of a contribution bar order. The Releases executed by the parties in connection with the Settlements become null, void and of no effect if either: (i) a bar order is not entered by October 13, 2009; or (ii) if BofA provides notice of its rejection of an entered contribution bar order that differs materially from the parties proposed order, and either party thereafter terminates the Agreement. To effectuate the settlement, on September 16, 2009, at BofA's behest, District Court Judge Kaplan issued the good faith determination, bar order and final judgment. The BofA Defendants are Bank of America Corporation, Bank of America, N.A., Bank of America National Trust and Savings Association, Banc of America Securities, LLC, Banc of America Securities Limited, Bank of America International Limited, and their various subsidiaries and affiliates. In the order, the Court finds and determines that the Settlements made, and the releases being exchanged pursuant to the Settlements were given and received in good faith. The BofA Releasees are discharged from any liability to any other person for contribution or indemnity that relates to, or is in any way based upon or arises from or is in any way connected with any Released Claim. All persons, including the Non-Settling Parties, are permanently barred, enjoined and restrained from commencing, prosecuting or asserting any claim for contribution or indemnity against any BofA Releasee that arises out of a judgment or settlement obtained by any of the Parmalat Releasors against that person that relates to, or is in any way based upon or arises from or is in any way connected with, any Released Claim. The BofA Releasees are permanently barred from commencing any claim for contribution or indemnity against any other person whose liability is not extinguished by the Settlements that arises out of a judgment or settlement obtained by any of the Parmalat Releasors against that BofA Releasee that relates to any Released Claim. To the extent any person, including any of the Non-Settling Parties, is entitled to a settlement credit, it will be calculated using a "capped proportionate share" formula, pursuant to which, for common damages, the credit given for the settlement will be the greater of the settlement amount or the proportionate share of the BofA Releasees' fault as proven at trial. Judge Kaplan, however, ruled that his Good Faith Order does not bar or release the claims owned by (i) Food Holdings Limited, Dairy Holdings Limited, Parmalat Capital Finance Limited, and their joint official liquidators, G. James Cleaver and Gordon I. MacRae; Gerald K. Smith, as the Litigation Trustee of the Farmland Dairies LLC Litigation Trust; (ii) G. Peter Pappas, as the Plan Administrator of the Plan of Liquidation of Parmalat - USA Corporation; and (iii) current or former holders of bonds, shares or securities of Parmalat Finanziaria S.p.A., or its affiliates or subsidiaries against the BofA Releasees, including all claims they may own or hold that relate to, or that are in any way based upon or arise from or are in any way connected with, any services provided by any BofA Releasee to any Parmalat Releasor prior to July 28, 2009. As of July 28, 2009, all litigation between Parmalat and BofA, acting directly or through their subsidiaries and affiliates, has been discontinued. Parmalat, Dr. Enrico Bondi, and the BofA Defendants have agreed, in two separate stipulations, to dismiss with prejudice all their claims asserted against each other relating to any matter up to and including July 28, 2009. Each party will bear its own fees and costs. A full-text copy of the Good Faith Order is available for free at http://bankrupt.com/misc/Parmalat_Order_BofA_Settlement.pdf In support of their request for the Bar Order and Judgment, the BofA Defendants asserted that the Settlement was the product of extensive arm's length negotiations, including mediation before former California Superior Court Judge Daniel Weinstein, and that they resolve all claims between them and Parmalat through the exchange of reciprocal releases. Dr. Bondi joined in and supported the BofA Defendants' request. A full-text copy of the Proposed Order is available for free at: http://bankrupt.com/misc/Parmalat_ProposedOrder_081909.pdf In a separate letter addressed to the Court, counsel for both BofA and Dr. Bondi asked Judge Kaplan to extend the present stay of proceedings in Dr. Bondi's action against BofA until further Court order, or, in the alternative, until October 13, 2009, in furtherance of and to assist in the consummation of the parties' Settlement. Judge Kaplan, however, did not grant the extension request. The stay expired on September 16, 2009. Court Questions Indemnification Provision Prior to entry of the September 16 Order, Judge Kaplan objected to the Proposed Order filed by the BofA Defendants complaining that the Proposed Bar Order would bar claims for contribution and indemnification with respect to the released claim. He pointed out that Sections 15 to 108 of the New York General Obligations Law does not authorize orders barring claims for indemnification, as distinguished from contribution, citing Gibbs-Alfano v. Burton, 281 F.3d 12, 20 (2d Cir. 2002), among others. Accordingly, Judge Kaplan invited the BofA Defendants and other interested party to brief the question whether the Court may and should include a bar on indemnification claims in any bar order that may be entered. In response, the BofA Defendants submitted a supplemental memorandum of law in further support of their request, and to address Judge Kaplan's question. The Proposed Order did not specify a governing law because in BofA's view, whether regarded as governed by Italian law, federal common law, or New York law, the Proposed Order can and should include an indemnification bar because that provision is consistent with the prior Deloitte Bar Order entered in the MDL proceeding, and with prior rulings of the Second Circuit and of New York federal and state courts, the BofA Defendants explained. The Italian law governs the Deloitte Bar Order entered by Judge Cote in connection with the Parmalat-Deloitte Settlement. The BofA Defendants said they would not apply the indemnification bar in the Proposed Order to void its obligations to current and former Bank employees with valid indemnification claims relating to the Parmalat matter. They added that the language also would not bar independent claims that do not arise from the non-settling defendant's liability to the plaintiff, but it would bar indemnification claims of third parties, whose rights would be protected by the proposed capped proportionate judgment credit provision of the Proposed Order. BofA Seeks Revision of Good Faith Order Due to an inadvertent error, the private placement parties that have filed lawsuits against BofA were not included in the list of parties whose claims were not barred or released by the bar order. Accordingly, BofA and the Private Placement Parties reached agreement on the language to be used in a revised bar order, but unfortunately was not filed with the Court immediately. The agreed revisions to the Good Faith Order include the addition of names in the Private Placement Parties. In addition, the handwritten changes by the Court on the Good Faith Order have been incorporated in the typewritten text. A redlined copy of the Good Faith Order containing the revisions can be obtained for free at: http://bankrupt.com/misc/Parmalat_Order_Redlined_091809.pdf BofA assures the Court that the revision is a ministerial change, as it simply adds names of additional parties to that portion of the bar order listing third parties, whose claims are not affected by the bar order. The Court granted BofA's request to revise the Good Faith Order, and ruled that the Order is modified accordingly. About Parmalat S.p.A. Headquartered in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/-- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. The Company's U.S. operations filed for Chapter 11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represent the Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on December 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court has declared the units insolvent. On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No. 04-14268, in the United States Bankruptcy Court for the Southern District of New York. Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and Food Holdings are Cayman Island special-purpose vehicles established by Parmalat S.p.A. The Finance Companies are under separate winding up petitions before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as Joint Provisional Liquidators in the cases. On January 20, 2004, the Liquidators filed Sec. 304 petition, Case No. 04-10362, in the United States Bankruptcy Court for the Southern District of New York. In May 2006, the Cayman Island Court appointed Messrs. MacRae and Cleaver as Joint Official Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presided over the Parmalat Debtors' U.S. cases. On June 21, 2007, the U.S. Court granted Parmalat permanent injunction. PARMALAT SPA: Irish High Court OKs deal With Eurofood IFSC ---------------------------------------------------------- Parmalat S.p.A. said in a company statement that the High Court of Ireland has, on September 3, 2009, approved its settlement with Eurofood IFSC Limited resolving all reciprocal claims. Under the agreement, in return for the issuance of 9,000,000 shares of Parmalat stock, Eurofood will waive and release all claims that it has asserted against Parmalat, withdraw its demands, and assign to Parmalat S.p.A. all rights and claims it has against Parmalat de Venezuela and Indulac, including the claim arising from a loan of $80 million plus interest. Eurofood is a subsidiary of Parmalat S.p.A. that provides financing facilities for companies in the Parmalat group. Eurofood is incorporated and registered in Ireland. To recall, the European Court of Justice gave the Irish High Court jurisdiction over the liquidation proceedings of Eurofood in a ruling on May 2, 2006. Bank of America previously asked the Irish High Court in 2004 for the winding up of Eurofood, and sought the appointment of a provisional liquidator. BofA alleged that Eurofood was insolvent, and that Eurofood owed BofA in excess of $3.5 million. About Parmalat S.p.A. Headquartered in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/-- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. The Company's U.S. operations filed for Chapter 11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represent the Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on December 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court has declared the units insolvent. On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No. 04-14268, in the United States Bankruptcy Court for the Southern District of New York. Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and Food Holdings are Cayman Island special-purpose vehicles established by Parmalat S.p.A. The Finance Companies are under separate winding up petitions before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as Joint Provisional Liquidators in the cases. On January 20, 2004, the Liquidators filed Sec. 304 petition, Case No. 04-10362, in the United States Bankruptcy Court for the Southern District of New York. In May 2006, the Cayman Island Court appointed Messrs. MacRae and Cleaver as Joint Official Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presided over the Parmalat Debtors' U.S. cases. On June 21, 2007, the U.S. Court granted Parmalat permanent injunction. PARLUX FRAGRANCES: Reports 8% Increase in Q2 Net Sales ------------------------------------------------------ Parlux Fragrances, Inc., said unaudited net sales for the quarter ended September 30, 2009, were estimated to be $56.5 million, an 8% increase over $52.4 million reported for same period of the prior year, while net sales results for the six months ended September 30, 2009, were estimated at $80.1 million, compared to $75.7 million for the comparable prior year period, an increase of approximately 6% over the prior year. During the current quarter, the Company launched products under three new licenses, which included Queen, by Queen Latifah, Natori, and, most recently, Ecko by Marc Ecko. In addition, new fragrances were launched under existing licenses with Paris Hilton (Siren) and Jessica Simpson (Fancy Love). Mr. Neil J. Katz, Chairman and CEO, noted, "We are very pleased that our new product launches have been so positively embraced by both our retail partners and the consumer. The results for the first six months are indicative of our efforts to introduce our new brands while continuing to control our expenses. Our domestic department store business continued to grow during a time when retailers were drastically reducing inventory levels and consumer traffic had significantly declined. We are continuing to work towards securing permanent financing, and believe these results should assist us in that effort." Mr. Katz continued, "We remain cautiously optimistic that, with our new product launches, we will continue to see positive results during the upcoming holiday season." The Company anticipates reporting its earnings for the three and six months ended September 30, 2009, during the week of November 2, 2009. Annual Meeting of Stockholders The Company will hold its Annual Meeting of Stockholders on Tuesday, October 13, 2009, at 11:00 a.m., at The Westin Diplomat Resort & Spa, 3555 S. Ocean Drive, Room 303, Hollywood, Florida 33009. In addition, the Company will host a conference call during its 2009 Annual Meeting. This will allow its shareholders, who cannot be present at this year's Meeting, to listen in. Shareholders listening by telephone or Internet will not be deemed to be in attendance, will not be permitted to vote, and will not be part of the quorum at the Meeting. Shareholders must be present, in person or by proxy, to be considered part of the quorum at the Meeting and to vote at the Meeting. To participate, please call Toll Free: 888-595-5338 or International: 201-526- 1830. A digital replay of the conference call will be available from Tuesday, October 13, 2009 after 3:00 p.m., until midnight October 20, 2009. To access the rebroadcast, Toll Free: 1-888- 632-8973 or via International: 201-499-0429. Replay Code: 30765206. The Company is now offering its shareholders access to its conference calls via audio webcast link directly on its Web site http://www.parlux.com/and click on the red link, "Parlux Webcast Site". Regions Bank Forbearance As reported by the Troubled Company Reporter, Parlux Fragrances and its subsidiary, Parlux Ltd., as borrowers, on August 31, 2009, entered into a Forbearance Agreement regarding its Loan and Security Agreement, dated as of July 22, 2008, with Regions Bank, as lender. The current outstanding principal balance under the Credit Agreement is $6,680,612. Pursuant to the Forbearance Agreement, Regions Bank has agreed to forbear from the exercise of certain rights and remedies that it has under the Credit Agreement and supporting documents until the earlier of (1) an additional event of default under the Credit Agreement, (2) an event of default under the Forbearance Agreement, or (3) October 28, 2009. The Company is currently negotiating replacement financing with several potential sources and expects to have a new financing arrangement in place in the near future. No assurance can be given that the Company will be able to enter into a new financing arrangement. About Parlux Fragrances Based in Fort Lauderdale, Florida, Parlux Fragrances, Inc. (Nasdaq:PARL) is a manufacturer and international distributor of prestige products. It holds licenses for Paris Hilton, Jessica Simpson, GUESS?, Nicole Miller, Josie Natori, Queen Latifah, Marc Ecko, Rihanna, Kanye West, XOXO, Ocean Pacific (OP), Andy Roddick, babyGund, and Fred Hayman Beverly Hills designer fragrances, as well as Paris Hilton watches, cosmetics, sunglasses, handbags and other small leather accessories. PARRISH STROUD: Voluntary Chapter 11 Case Summary ------------------------------------------------- Joint Debtors: Parrish D. Stroud Angie J. Stroud 738 E. NC 24 Kenansville, NC 28349 Bankruptcy Case No.: 09-08659 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Eastern District of North Carolina (Wilson) Judge: Randy D. Doub Debtors' Counsel: Michael P. Peavey, Esq. PO Box 1115 Wilson, NC 27894-1115 Tel: (252) 291-8020 Fax: (252) 291-8309 Email: mpeavey@peaveylaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $50,001 to $100,000 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. PEANUT CORP: Ron Simon to File 55 Claims for Compensation --------------------------------------------------------- The Associated Press reports that Ron Simon, the lawyer representing people sickened by the salmonella outbreak linked to Peanut Corp. of America, will file 55 claims for compensation. According to The AP, Mr. Simon said that he will file his clients' claims by next week. Many more claims could be filed by the October 31 deadline, The AP states, citing Mr. Simon. Following a nationwide outbreak of Salmonella poisoning that reports say sickened more than 700 people and killed nine, Peanut Corporation of America -- http://www.peanutcorp.com/-- filed a Chapter 7 bankruptcy petition in February 2009 (Bankr. W.D. Va. Case No. 09-60452). The Company estimated its assets and liabilities in the range of $1 million to $10 million at the time of the filing. As reported in the Troubled Company Reporter on March 31, 2009, Federal Insurance Co. provides Peanut Corp. of America with $1 million of insurance coverage and initiated the interpleader action in the Bankruptcy Court to help figure out how to divide the insurance proceeds as claims exceed the amount of coverage. PENN TREATY: May Need $1.3 Bil. for Reserves for Claims ------------------------------------------------------- Penn Treaty Network American Insurance Co. may need $1.3 billion to have "appropriate reserves" for claims, the company's state regulator said in its petition for liquidation of PTNA. An "evaluation has shown that PTNA is far more insolvent than originally believed," Pennsylvania Insurance Commissioner Joel Ario's office said in the document. Penn Treaty American Corp., the parent of the insurer, included the petitions for liquidation of PTNA and unit American Network Insurance Company in a regulatory filing October 7. A copy of the petition for liquidation for PTNA is available at: http://researcharchives.com/t/s?4686 A copy of the petition for liquidation for ANIC is available at: http://researcharchives.com/t/s?4687 As reported by the TCR on Oct. 5, 2009, the Pennsylvania Insurance Department on October 2 filed petitions that seek orders of liquidation for PTNA and ANIC. The petitions are subject to the approval of Commonwealth Court. "We have been on-site analyzing the organizations' assets, liabilities, reserves and surpluses since we began our rehabilitation action in January," Insurance Commissioner Joel Ario said. "Our comprehensive, independent evaluation has determined that the companies do not have the ability to pay future claims without significant rate increases that would have to be requested and approved in all 50 states. In the current circumstances, those rate increases simply would not be fair to policyholders. "We have instead petitioned for an orderly liquidation of all company assets in which policyholders' claim payments are our number one priority. Additionally, active long-term care policies will not be canceled, except by the policyholder, so they will be transitioned to the states' guaranty funds once an order takes effect. Guaranty funds have the right to assess other insurance companies to cover policyholder claims up to coverage limits that vary by state." Penn Treaty Network America, headquartered in Allentown, and its subsidiary, American Network, provide long-term care insurance to more than 120,000 policyholders. Together, the companies offered long-term care insurance in all 50 states and the District of Columbia. PENSKE AUTOMOTIVE: S&P Affirms Corporate Credit Rating at 'B+' -------------------------------------------------------------- Standard & Poor's Ratings Services said it has affirmed its 'B+' corporate credit and 'B-' issue ratings on Penske Automotive Group Inc. and removed the ratings from CreditWatch, where they had been placed on June 5, 2009, with negative implications. The outlook is negative. The rating action follows Penske's recent announcement that it has terminated its discussions with General Motors Co. to acquire the Saturn brand. S&P placed the ratings on CreditWatch with negative implications when Penske announced its plans to acquire the Saturn brand. Penske is the second-largest of several large consolidators in the highly competitive U.S. auto retailing industry. The retailer had lease-adjusted debt of $2.7 billion as of June 30, 2009. "Termination of the transaction eliminates the risks that Penske would have faced if it had completed its original announced intention to acquire the Saturn unit," said Standard & Poor's credit analyst Nancy Messer. "One of these risks was that Penske might have taken on additional debt and reduced liquidity to effect the transaction. S&P believes the transaction would also have involved significant execution risk if Penske had assumed responsibility for future vehicle product selection and manufacturing strategy," she continued. The ratings on Penske reflect the aggressive financial risk profile and a fair business risk profile. Continuing economic weakness in the U.S. has caused a decline in North American sales of light vehicles and, to some extent, has caused consumers to defer discretionary spending on auto maintenance. S&P expects U.S. sales of new light vehicles to drop about 22% in 2009 from 2008 levels, to 10.3 million units, including the effect of the "Cash for Clunkers" program. S&P estimate new-vehicle sales will improve to 10.9 million units in 2010, but this would still be well below the weak levels of 2008. S&P view the financial effect of the General Motors Corp. and Chrysler LLC bankruptcies on Penske as relatively benign because of the speed with which the two automakers exited bankruptcy. Penske had franchise rights terminated at one GM dealership as a result of this process. Penske's credit measures are weak for the rating. Lower EBITDA, resulting from the weak economy, combined with stable debt have led to aggressive leverage. S&P assumes the company will report free cash flow in the year ahead because capital investments should be lower than in the recent past, when the company was building several auto malls. Still, in S&P's view, leverage will remain high in the year ahead because cash flow generation-- although positive after capital investment--will be insufficient to meaningfully reduce permanent debt. Recovery in EBITDA is important for a reduction in leverage. S&P also expect Penske to achieve and maintain lease-adjusted total debt to EBITDA of no more than 6x for the rating and to generate free cash after capital spending. Penske's total revenue for the second quarter of 2009 fell 24% year over year, excluding the favorable effect of foreign exchange, as new- and used-vehicle sales (including fleet and wholesale sales) declined. Gross profit declined 21% in the second quarter because the company experienced weakness in all its business segments, but gross margin increased by 210 basis points, to 17%, as a result of the higher proportion of P&S revenue in overall sales and improvement in used-vehicle margins. S&P believes Penske's liquidity is adequate for the near term. The company derives some financial flexibility from its many dealerships, which could be sold with lender approval, although market transactions have been limited in the ongoing economic weakness. The negative outlook reflects Penske's aggressive leverage and S&P's view that the company may not be able to meaningfully reduce lease-adjusted leverage from the 8.1x indicated as of June 30, 2009. The primary reason in S&P's view would be because of the ongoing economic weakness constraining EBITDA and cash generation. S&P could lower the rating if S&P believed the company's reported EBITDA would fall short of S&P's 2009 estimate of $200 million by 10% or more and if debt remains at current levels, so that lease- adjusted leverage remains at 8x or higher. This could occur with a continuing weak U.S. economy and the company's inability to reduce its cost base to fit the reduced revenue. Alternatively, S&P could revise the outlook to stable if Penske can offset difficult auto sales through its revenue diversity and focus on operating efficiencies combined with generating positive free cash and material debt reduction. Specifically, this would mean the company would have to generate EBITDA over any four consecutive quarters of about $260 million, which could be sufficient to lower leverage to about 6.5x. Also, S&P could revise the outlook to stable if Penske were to access the capital markets, perhaps including issuing common equity and using the proceeds to permanently reduce debt such that S&P believed lease- adjusted leverage could reach 6x in the next two years. PETROQUEST ENERGY: Moody's Retains 'B3' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service commented that PetroQuest Energy, Inc.'s recent announcement regarding its borrowing base re-determination will not impact its ratings or stable rating outlook at this time (B3 Corporate Family Rating, B3 Probability of Default Rating, Caa1 senior unsecured note rating, and SGL-3 rating). The last rating action on PetroQuest was on December 5, 2007, when Moody's upgraded the company's ratings. PetroQuest Energy, Inc., is headquartered in Lafayette, Louisiana. PETRORIG: Sells Two Rigs for $950 Mil. to Diamond Offshore ---------------------------------------------------------- Subsidiaries of Norway-based PetroMena ASA have sold two of their three ultra-deepwater semi-submersible harsh environment drilling rigs through the Chapter 11 process, even though the companies have few if any connections to the U.S., Bill Rochelle at Bloomberg reported. The PetroMena subsidiaries obtained approval from the U.S. Bankruptcy Court for the Southern District of New York to auction of their oil rigs. According to Bill Rochelle, two vessels were purchased for $950 million by affiliates of Diamond Offshore Drilling Inc. After paying Jurong Shipyard Pte Ltd., the shipyard in Singapore where the rigs were being built, the sales generated a total of some $440 million for the PetroMena subsidiaries in bankruptcy. One rig remains to be sold. PetroRig I Pte Ltd, PetroRig II Pte Ltd, and PetroRig III Pte Ltd. entered into agreements to construct three drilling rigs with Singapore's Sembcorp Marine. The rigs were scheduled for delivery from Sembcorp's Jurong Shipyard in April 2009, September 2009, and January 2010. PetroMENA, the parent company, struggled to put together financing to complete construction of the rigs and was unable to make final installments on the construction contracts The PetroMena units filed for bankruptcy when Jurong was on the brink of foreclosing one of the drilling rigs. The three rigs were being built for a total cost of almost $1.5 billion. Almost $750 million remained unpaid on the construction contracts. About PetroMena ASA PetroMENA ASA -- http://www.petromena.no/-- is a Norway-based company engaged in the ownership and operation of drilling rigs and vessels, as well as in the construction of off-shore drilling platforms and facilities for the oil industry. The Company is operational through its three wholly owned Singapore-based subsidiaries: PetroRig I Pte Ltd, PetroRig II Pte Ltd and PetroRig III Pte Ltd. The Company's rigs are designed for drilling in ultra deep waters, in such areas as the Mexican Gulf, Brazil, West and South Africa, among others. Additionally, the Company's subsidiaries are engaged in the construction of semi submersible drilling rigs at the Jurong shipyard in Singapore. As of December 31, 2008, the Company held management and operational agreements with Larsen Oil & Gas Ltd and Larsen Oil Gas AS. The Company's majority shareholder is Petrolia Drilling ASA, with 51.47% of its interests. Headquartered in Singapore, PetroRig I Pte Ltd, PetroRig II Pte Ltd, and PetroRig III Pte Ltd are rig-owning Singapore subsidiaries of Norwegian oilfield driller PetroMENA ASA. PetroRig I Pte. Ltd. and its affiliates filed for Chapter 11 on May 17, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-13083). Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP represents the Debtors in their restructuring efforts. The Debtors listed between $100 million and $500 million each in assets and debts. PILGRIM'S PRIDE: Argo Partners, et al., Buy $1.59MM in Claims ------------------------------------------------------------- Thirty-three trade creditors, from September 22 to October 1, 2009, transferred claims totaling $1,597,633 to: Transferee Amount ---------- ------ Argo Partners $78,529 ASM Capital III, L.P. $308,850 Blue Heron Micro Opportunities, Fund, LLP $5,488 Creditor Liquidity, L.P. $1,466 Debt Acquisition Company of America V, LLC $690 Fair Harbor Capital LLC $17,642 Hain Capital Holdings, Ltd. $140,839 Jefferies Leveraged Credit Products, LLC $116,737 Liquidity Solutions Inc. $29,120 Marblegate Special Opportunity Master Fund, LP $818,856 U.S. Debt Recovery $7,031 U.S. Debt Recovery III, LLC $72,385 A list of the names of the transferors is available for free at http://bankrupt.com/misc/PPC_ClaimsTransfrslst_Sep22_Oct01.pdf About Pilgrim's Pride Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation (Pink Sheets: PGPDQ) -- http://www.pilgrimspride.com/-- employs roughly 41,000 people and operates chicken processing plants and prepared-foods facilities in 14 states, Puerto Rico and Mexico. The Company's primary distribution is through retailers and foodservice distributors. Pilgrim's Pride Corp. and six other affiliates filed Chapter 11 petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No. 08-45664). The Debtors' operations in Mexico and certain operations in the United States were not included in the filing and continue to operate as usual outside of the Chapter 11 process. Pilgrim's Pride has engaged Stephen A. Youngman, Esq., Martin A. Sosland, Esq., and Gary T. Holzer, Esq., at Weil, Gotshal & Manges LLP, as bankruptcy counsel. Lazard Freres & Co., LLC, is the Company's investment bankers and William K. Snyder of CRG Partners Group LLC is chief restructuring officer. Kurtzman Carson Consulting LLC serves as claims and notice agent. Kelly Hart and Brown Rudnick represent the official equity committee. Attorneys at Andrews Kurth LLP represents the official committee of unsecured creditors. As of December 27, 2008, the Company had $3,215,103,000 in total assets, $612,682,000 in total current liabilities, $225,991,000 in total long-term debt and other liabilities, and $2,253,391,000 in liabilities subject to compromise. Bankruptcy Creditors' Service, Inc., publishes Pilgrim's Pride Bankruptcy News. The newsletter tracks the Chapter 11 proceeding of Pilgrim's Pride Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PILGRIM'S PRIDE: To Open 150 New Jobs in Suwannee County -------------------------------------------------------- Pilgrim's Pride Corporation, which is expected to emerge from bankruptcy by year-end, has said that its Suwannee County poultry plant will resume full operation in the coming weeks, Jeff Waters of the Suwannee Democrat reported September 29. Pilgrim's Pride director for corporate communications, Ray Atkinson said that about 150 new jobs will be added to boost second shift operations at the plant which will soon be back around the end of November. To recall, Pilgrim's Pride had laid off some 500 positions after the company filed for bankruptcy in December. As part of its Plan of Reorganization, Pilgrim's Pride has agreed to a merger with Brazilian beef producer JBS and allowing JBS to purchase 64% of its stock. About Pilgrim's Pride Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation (Pink Sheets: PGPDQ) -- http://www.pilgrimspride.com/-- employs roughly 41,000 people and operates chicken processing plants and prepared-foods facilities in 14 states, Puerto Rico and Mexico. The Company's primary distribution is through retailers and foodservice distributors. Pilgrim's Pride Corp. and six other affiliates filed Chapter 11 petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No. 08-45664). The Debtors' operations in Mexico and certain operations in the United States were not included in the filing and continue to operate as usual outside of the Chapter 11 process. Pilgrim's Pride has engaged Stephen A. Youngman, Esq., Martin A. Sosland, Esq., and Gary T. Holzer, Esq., at Weil, Gotshal & Manges LLP, as bankruptcy counsel. Lazard Freres & Co., LLC, is the Company's investment bankers and William K. Snyder of CRG Partners Group LLC is chief restructuring officer. Kurtzman Carson Consulting LLC serves as claims and notice agent. Kelly Hart and Brown Rudnick represent the official equity committee. Attorneys at Andrews Kurth LLP represents the official committee of unsecured creditors. As of December 27, 2008, the Company had $3,215,103,000 in total assets, $612,682,000 in total current liabilities, $225,991,000 in total long-term debt and other liabilities, and $2,253,391,000 in liabilities subject to compromise. Bankruptcy Creditors' Service, Inc., publishes Pilgrim's Pride Bankruptcy News. The newsletter tracks the Chapter 11 proceeding of Pilgrim's Pride Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PLAINFIELD APARTMENTS: Hearing on PMUA Claim Moved to Oct. 6 ------------------------------------------------------------ Mark Spivey at MyCentralJersey.com reports that U.S. Bankruptcy Judge Morris Stern has postponed a hearing regarding a total of $449,581 Plainfield Apartments LLC allegedly owed to the Plainfield Municipal Utilities Authority, or PMUA, to October 26, as the authority's council, Ted Del Guercio III at attorney McManimon & Scotland, was struck by an illness. Judge Stern bestowed in August 2009 priority status on the debts owed to PMUA. Plainfield Apartments owes PMUA some $357,819 and has a balance due of another $91,762, MyCentralJersey.com relates, citing a letter sent to Judge Stern by Mr. Del Guercio. According to the report, Mr. Del Guercio said in the letter that much of the debt, which the authority states in court documents accumulated due to unpaid sewer and solid-waste services, has been "outstanding for well over a year". Plainfield Apartments, LLC, is a real estate company based in Plainfield, New Jersey. It filed for Chapter 11 on August 7 (Bankr. D. N.J. Case No. 09-30679). Richard D. Trenk, Esq., at Trenk, DiPasquale, Webster, Della Fera & Sodono, P.C., assists the Company in its restructuring efforts. The Company listed $14,181,853 in assets and $17,587,846 in debts. An affiliate, Fulton-Harrison LLC, filed for protection in the same court on July 29 (Case No. 09-29666). PLIANT CORP: Judge Approves Apollo-Backed Chapter 11 Plan --------------------------------------------------------- According to Law360, the bankruptcy judge overseeing the Chapter 11 case of plastics company Pliant Corp. has signed off on a reorganization plan offered by the debtor and creditor Apollo Management VI LP that gives more recovery to first-lien lenders than previously expected. The Court held a hearing Oct. 6, 2009, at 2:00 p.m. (Prevailing Eastern Time), to consider confirmation of the joint plan of reorganization for the Debtors. On the Plan Effective Date, Reorganized Pliant and Berry Plastics Corporation -- which is 79%-owned by Apollo Investment Fund VI, L.P. and Apollo Investment Fund V, L.P. collectively -- will enter into an Intercompany Services Agreement. Berry will contribute assets related to its Stretch Films business to the applicable Reorganized Debtors in exchange for (a) the issuance to Berry or its designated subsidiary of 20% of Reorganized Pliant Common Stock and (b) subject to the satisfaction of certain performance- based thresholds, the obligation to issue to Berry or its designated subsidiary additional shares of New Common Stock representing 5% of the New Common Stock on a fully-diluted basis. The Stretch Films business produces both hand and machine-wrap stretch films, which are used by end users to wrap products and packages for storage and shipping. The stretch films products are sold to distributors and retail and industrial end users under the MaxTech(R) and PalleTech(R) brands. Under the Plan, holders of first lien notes will recover 89% of their claims, while unsecured creditors will recover 17.5 cents on the dollar. A full-text copy of the Joint Plan proposed by Apollo is available at no charge at http://ResearchArchives.com/t/s?43b9 A full-text copy of the Disclosure Statement is available at no charge at http://ResearchArchives.com/t/s?43b8 About Pliant Corp. 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. PRESSTEK INC: Lender Group Forbears Until November 30 ----------------------------------------------------- Presstek, Inc. and certain of its affiliated U.S. companies, including Lasertel, Inc., Precision Lithograining Corp., Precision Acquisition Corp., SDK Realty Corp., ABD International, Inc., Presstek Capital Corp., Presstek Overseas Corp., ABD Canada Holdings , Inc. and Presstek New York, Inc. on October 1, 2009, entered into a Forbearance and Amendment Agreement with its bank lending group consisting of RBS Citizens, National Association, as Administrative Agent and Lender, Keybank National Association and TD Bank, N.A. The Amendment amends an Amended and Restated Credit Agreement, dated as of November 5, 2004, as amended, among the Company and the Lenders. The terms and conditions of the Amendment are: 1. The expiration date of the Credit Agreement has been extended from November 4, 2009, to December 15, 2009. The Forbearance Termination Date will be November 30, 2009, if the Company elects not to pay a fee of $20,000 to the Lenders to extend the Forbearance Termination Date from November 30, 2009, to December 15, 2009. 2. Through the Forbearance Termination Date, the Administrative Agent and the Lenders agree to forbear from exercising their rights and remedies under the Credit Agreement, including commencing legal action to enforce the Company's obligations, until the earlier of: (a) the occurrence or continuance of any Event of Default other than the Events of Default occurring in the Company's second fiscal quarter of 2009 as a result of a violation of certain covenants and Events of Default that may arise as a result of the violation of certain covenants during the Company's third fiscal quarter of 2009; (b) the failure of any Obligor to comply with any term or condition set forth in the Amendment; (c) the occurrence after the Forbearance Effective Date of any event or circumstance that has, or could be reasonably expected to have, a Material Adverse Effect; (d) any Obligor or any Affiliate of any Obligor shall commence any litigation or other proceeding against the Administrative Agent or any Lender or any Affiliate of the Administrative Agent or any Lender in connection with any of the transactions contemplated by any of the Loan Documents, including the Amendment; (e) the failure of actual cash flow, as projected in the projections to be delivered by the Company pursuant to the Amendment for any month, commencing with the month ended September 30, 2009, to be at least 80% of the amount of cash flow projected for such month by such projections; and (f) the Forbearance Termination Date. 3. On and after the Forbearance Termination Date, the Administrative Agent in its sole and absolute discretion (or as directed by the Requisite Lenders in their sole and absolute discretion) may proceed to enforce any or all of its and the Lenders' rights under or in respect of the Loan Documents and applicable law. 4. The aggregate Revolving Loan Commitment of the Lenders has been reduced to $27,000,000 from $45,000,000. 5. From the Forbearance Effective Date through the Forbearance Termination Date, the interest rate applicable to all Loans shall be the Prime Rate plus 4% per annum; on and after the Forbearance Termination Date the definition of "Default Rate" under the Credit Agreement shall mean the Prime Rate plus 6% per annum. From the Forbearance Effective Date through the Forbearance Termination Date, the Company shall not have the right to elect to pay interest on any Loan based on the LIBOR rate. 6. Borrower shall pay to Administrative Agent, for the pro rata accounts of the Lenders in accordance with the aggregate amount of Obligations owed to each of them, a forbearance fee in the amount of $250,000. Although the entire $250,000 Forbearance Fee is deemed to have been earned and irrevocably due as of the Forbearance Effective Date, $125,000 of the Forbearance Fee shall be due and payable on the Forbearance Effective Date and $125,000 of the Forbearance Fee shall be due and payable on the earlier of the consummation of a refinancing and repayment of the Obligations and the Forbearance Termination Date. 7. The Company is required to provide certain consolidated and consolidating financial information to the Administrative Agent, as well as rolling thirteen (13) week cash flow statements, cash flow reports and financial projections. 8. The Company shall hire a consultant or employee to review all documents and information to be delivered to the Administrative Agent and to provide advice to management on the structure of the business until the Forbearance Termination Date. 9. The dollar limitations under the Credit Agreement for certain types or ordinary course transactions, without obtaining the consent of the Administrative Agent or Requisite Lenders, have been reduced for the following types of transactions: loans and advances; incurrence of indebtedness; employee loans and affiliate transactions; permitted liens; and the sale of assets or subsidiary stock. 10. Certain definitions under the Credit Agreement have been added to reflect definitions contained in the Amendment. Presstek, Inc., is a manufacturer and marketer of digital offset printing solutions. These products are engineered to provide a streamlined workflow that shortens the print cycle time, reduces overall production costs. The Company operates in two reportable segments: the Presstek segment and the Lasertel segment. The Presstek segment is primarily engaged in the development, manufacture, sales, distribution, and servicing of digital offset printing solutions for the graphic arts industries. The Lasertel segment is primarily engaged in the manufacture and development of high-powered laser diodes for a variety of industry segments. Presstek's subsidiary, Lasertel, Inc. (Lastertel), manufactures semiconductor laser diodes for Presstek and external customer applications. The Company had $118,224,000 in assets against debts of $55,046,000 as of July 4, 2009. PROMETRIC INC: Moody's Gives Positive Outlook, Affirms 'B2' Rating ------------------------------------------------------------------ Moody's Investors Service changed Prometric Inc.'s ratings outlook to positive from stable. Concurrently, Moody's affirmed the company's B2 corporate family rating and the Ba3 rating on its senior secured credit facilities. The outlook revision reflects Prometric's positive organic sales/earnings growth trends and debt reduction that has resulted in improvements in credit metrics since its acquisition by Educational Testing Service in 2007. The outlook revision is also supported by Moody's expectation for improved cash flow generation following the completion of a one- time excess working capital payment made earlier in 2009. Although Prometric's credit metrics are strong for the B2 rating category, Moody's remains concerned over the limited cushion under one of the financial covenants governing its credit facilities, which restrains the ratings. Absent an exogenous event, Moody's could upgrade the ratings to the extent the company is able to improve the cushion under the financial covenant through debt reduction and organic earnings growth. These ratings were affirmed: * Corporate family rating at B2; * Probability-of-default rating at B2; * $25 million senior secured revolving credit facility due 2012 at Ba3. Point estimate revised (LGD2, 24%) from (LGD2, 26%); * $159 million first lien senior secured term loan due 2013 at Ba3. Point estimate revised (LGD2, 24%) from (LGD2, 26%). The last rating action was on July 27, 2007, when Moody's assigned Ba3 ratings to Prometric's then proposed senior secured facilities. Concurrently, Moody's assigned B2 corporate family and probability-of-default ratings. The ratings outlook was stable. Headquartered in Baltimore, Maryland, Prometric Inc. is a leading provider of technology-based assessment solutions including test development and delivery for government entities, professional organizations, academic institutions, corporations and information technology clients. PTC ALLIANCE: Gets Nod to Use $5-Mil. DIP Loan from Black Diamond ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized PTC Alliance Corp. and its debtor-affiliates to access, on an interim basis, $5 million in postpetition financing under a superpriority debtor-in-possession credit agreement with Black Diamond Commercial Finance LLC, as lender and administrative agent. The DIP lender has agreed to provide $15 million in financing on the final basis. A hearing is set for Oct. 27, 2009, at 9:00 a.m., to consider final approval of the Debtors' request. Objections, if any, are due Oct. 20, 2009. According to the Troubled Company Reporter on Oct. 7, 2009, Black Diamond provided $70 million to the Debtors, secured by a lien on substantially all of the Debtors' assets n July 25, 2006. As of their bankruptcy filing, the Debtors owe about $41 million to Black Diamond. The Debtors said they want to access $5 million of the proposed financing on the interim basis. All loans under the DIP facility will bear interest at alternate base rate plus applicable margin and all DIP obligations will incur interest at a rate per annum equal to the alternate bas rate plus applicable margin. The DIP facility is subject to a $250,000 carve-out to pay fees incurred by professionals employed by the Debtors and any statutory committee. Proceeds of the facility will be used to finance the sale of substantially all of the Debtors' assets, among other things. The DIP agreement contains customary events of default. About PTC Alliance Headquartered in Wexford, Pennsylvania, PTC Alliance Corp. makes welded and cold drawn mechanical steel tubing and tubular shapes, chrome-plated bar products and precision components. The Company and its affiliates filed for Chapter 11 protection on October 1, 2009 (Bankr. D. Del. Lead Case No. 09-13395). PTC Alliance listed, in its petition, assets between $50 million and $100 million, and debts between $100 million and $500 million. PTC ALLIANCE: Wants to Hire Messana Rosner as Del. Special Counsel ------------------------------------------------------------------ PTC Alliance Corp. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Messana Rosner & Stern LLP as their Delaware special counsel. The firm has agreed to: a) advise the Debtors as local Delaware counsel and assisting DLA Piper LLP (US), which the Debtors seek to retain as their primary special debtor-in-possession finance counsel, in connection with the Debtors' debtor-in-possession financing; b) prepare, present and respond to, on behalf of the Debtors, as debtors in possession, necessary applications, motions, objections, orders, reports, filings and other legal papers in connection with the Debtors' debtor-in-possession financing and cash collateral arrangements during the pendency of these chapter 11 cases; c) consulting with the Debtors' management and other advisors in connection with the Debtors' efforts to obtain debtor-in- possession financing and cash collateral arrangements; d) attend meetings and negotiating with representative of the Debtors' prepetition lenders and other third parties and participating in negotiations with respect to the above matters; and e) perform any other necessary legal services normally associated with the above matters, as the Debtors' Delaware Special DIP Counsel during the pendency of these chapter 11 cases. The firm's professionals and their standard hourly rates: Frederick B. Rosner, Esq. attorney $450 Kenneth L. Dorsney, Esq. attorney $350 Elizabeth M. O'Byrne paralegal $195 The Debtors assure the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in Wexford, Pennsylvania, PTC Alliance Corp. makes welded and cold drawn mechanical steel tubing and tubular shapes, chrome-plated bar products and precision components. The Company and its affiliates filed for Chapter 11 protection on October 1, 2009 (Bankr. D. Del. Lead Case No. 09-13395). The Debtors selected Reed Smith LLP as their counsel. PTC Alliance listed, in its petition, assets between $50 million and $100 million, and debts between $100 million and $500 million. PTC ALLIANCE: Wins Approval of 'First Day' Motions -------------------------------------------------- PTC Alliance and its U.S. subsidiaries received court authority to continue business operations without interruption during their Chapter 11 proceedings. Judge Christopher S. Sontchi of the U.S. Bankruptcy Court in Wilmington, Del. granted the company interim authority to access up to $2.5 million in debtor-in-possession financing. The company will use the financing, along with cash from operations, to fund operating expenses as it pursues a sale under Section 363 of the U.S. Bankruptcy Code. PTC Alliance will seek final authority to access up to $15 million in debtor-in-possession financing at a court hearing on October 27. Additionally, Judge Sontchi granted the company authority to continue paying employee salaries and benefits and to maintain its cash management system. "Approval of the 'first day' motions ensures PTC Alliance can continue normal business operations and serve our customers while we pursue the sale of substantially all of the company's assets," said Peter Whiting, the company's Chairman and Chief Executive Officer. "Products will continue to be shipped, suppliers will be paid on time and our employees will continue to receive salary and benefits." As previously announced, PTC Alliance has entered into an asset purchase agreement with funds managed by Black Diamond Capital Management LLC, the pre-petition term lenders, to act as a "stalking horse" bidder for the sale of substantially all of the company's assets. Judge Sontchi will consider approval of the sale procedures, including the deadline to submit bids and a date to hold an auction, at the October 27 hearing. PTC Alliance and its U.S. subsidiaries filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code on Oct. 1, 2009 in the U.S. Bankruptcy Court, District of Delaware. The cases are jointly administered at Case No. 09-13395. About PTC Alliance Headquartered in Wexford, Pennsylvania, PTC Alliance Corp. makes welded and cold drawn mechanical steel tubing and tubular shapes, chrome-plated bar products and precision components. The Company and its affiliates filed for Chapter 11 protection on October 1, 2009 (Bankr. D. Del. Lead Case No. 09-13395). The Debtors selected Reed Smith LLP as their counsel. The Debtors listed assets between $50 million and $100 million, and debts between $100 million and $500 million. QUIKSILVER INC: Moody's Downgrades Rating on Senior Note to 'Caa2' ------------------------------------------------------------------ Moody's Investors Service lowered Quiksilver Inc.'s senior unsecured note rating to Caa2 from Caa1. The company's B3 Corporate Family and Probability of Default ratings were affirmed. Moody's also upgraded Quiksilver's Speculative Grade Liquidity Rating to SGL-3 from SGL-4. The rating outlook is negative. The one-notch downgrade of Quiksilver's senior unsecured note rating to Caa2 reflects the granting of liens over a substantial portion of the company's European assets to secure its new European credit facilities. Quiksilver recently closed on EUR318 million of new secured credit facilities in Europe, which replaced a substantially similar amount of unsecured credit facilities. As a result, recovery prospects are now weaker for the senior unsecured noteholders in a default scenario. Quiksilver's B3 Corporate Family Rating reflects the company's high financial leverage, thin levels of interest coverage, and weak trends in sales and operating margins. Positive rating consideration is given to the company's global diversification and ownership of a portfolio of well known apparel and footwear brands and its adequate liquidity profile. The negative rating outlook reflects concerns that debt/EBITDA -- already high at almost 6.0 times -- could increase further if the company's operations do not stabilize. The upgrade of Quiksilver's Speculative Grade Liquidity Rating to SGL-3 from SGL-4 reflects the execution of the aforementioned EUR318 million in new credit facilities. Closing of these new facilities, coupled with Quiksilver's previously closed $153 million five-year secured term loan and a new US$200 million three-year asset-based revolving credit facility, has significantly extended the company's debt maturity profile and providing higher levels of committed longer term availability. This rating was downgraded: * $400 million senior unsecured notes due April 2015 to Caa2 (LGD 5, 80%) from Caa1 (LGD 4, 66%) These ratings were affirmed: * Corporate Family Rating at B3 * Probability of Default Rating at B3 This rating was upgraded: * Speculative Grade Liquidity rating to SGL-3 from SGL-4 Moody's last press release on Quiksilver Inc. was on August 5, 2009, when Moody's commented that the company's B3 Corporate Family Rating was not immediately impacted by its announced refinancing plans actions. Quiksilver, Inc., is a designer and distributor of branded apparel, footwear, accessories, and related products under brands including Quiksilver, Roxy, and DC. The company generates annual revenue of about $2.0 billion. RAFAEL ALMONTE RAMIREZ: Case Summary & 20 Largest Unsec. Creditors ------------------------------------------------------------------ Debtor: Rafael Almonte Ramirez dba Ra Fragance & Perfums dba Monalisa dba Fragance Desing 1040 Avenida Jesus T Pineiro San Juan, PR 00921 Bankruptcy Case No.: 09-08581 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court District of Puerto Rico (Old San Juan) Debtor's Counsel: Wigberto Lugo Mender, Esq. Lugo Mender & Co Centro Internacional De Mercadeo Rd 165 Torre 1 Suite 501 Guaynabo, PR 00968 Tel: (787) 707-0404 Email: wlugo@lugomender.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $2,491,377, and total debts of $3,158,938. A full-text copy of Mr. Ramirez's petition, including a list of his 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/prb09-08581.pdf The petition was signed by Mr. Ramirez. RANCHO PACIFIC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Rancho Pacific Telecommunications, Inc. 26160 Jackson Avenue Murrieta, CA 92563 Bankruptcy Case No.: 09-33785 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Central District of California (Riverside) Judge: Thomas B. Donovan Debtor's Counsel: Stuart J. Wald, Esq. 36154 Coffee Tree Pl Murrieta, CA 92562 Tel: (310) 429-3354 Email: stuart.wald@gmail.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/cacb09-33785.pdf The petition was signed by Edward Ellis, president of the Company. RAPTOR PHARMACEUTICAL: To Issue Up to $30,000,000 in Securities --------------------------------------------------------------- Raptor Pharmaceutical Corp., from time to time, may offer, issue and sell up to $30,000,000 of any combination of the securities, either individually or in units. Raptor may offer common stock or preferred stock upon conversion of debt securities, common stock upon conversion of preferred stock, or common stock, preferred stock or debt securities upon the exercise of warrants. Raptor Pharmaceutical filed a shelf registration statement on Form S-3 under the Securities Act of 1933. Raptor's common stock is traded on the NASDAQ Capital Market under the symbol "RPTPD." On October 6, 2009, the sale price of its common stock on the NASDAQ Capital Market was $3.25. As reported by the Troubled Company Reporter, Raptor Pharmaceuticals and TorreyPines Therapeutics, Inc., completed their merger on September 30, 2009. The combined company is named "Raptor Pharmaceutical Corp." and commenced trading on the NASDAQ Capital Market under the ticker symbol "RPTP" on September 30. Pursuant to NASDAQ's regulations, for the first 20 trading days the ticker symbol will be "RPTPd". The Companies' stockholders approved the proposals to complete the merger at its annual meeting of stockholders held September 28, 2009. The aggregate market value of Raptor's outstanding common equity held by non-affiliates on October 6, 2009, was approximately $55.5 million. The combined company is headquartered in Novato, California, and managed by Raptor's existing management team. On July 27, 2009, Raptor and TorreyPines entered into a definitive merger agreement. Under terms of the merger agreement, Raptor will be merged with and into a wholly owned subsidiary of TorreyPines upon closing. TorreyPines will issue, and Raptor stockholders will receive, shares of TorreyPines common stock such that Raptor stockholders will own 95%, and TorreyPines stockholders will own 5%, of the combined company. 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. As of June 30, 2009, TorreyPines had $1.42 million in total assets and $149,000 in total liabilities. As of June 30, 2009, the Company's accumulated deficit was $121.9 million. Without additional sources of cash, it said existing working capital is not sufficient to meet the cash requirements necessary to fund its planned operating expenses and working capital requirements through December 31, 2009. TorreyPines had indicated if it cannot complete the merger with Raptor in a timely manner, or otherwise obtain sufficient funding in the short-term, it may be forced to file for bankruptcy, cease operations or liquidate and dissolve the Company. The audit report of Ernst & Young LLP, independent registered public accounting firm, included in TorreyPines Therapeutics' Annual Report on Form 10-K for the year ended December 31, 2008, contained an explanatory paragraph describing conditions that raise substantial doubt about TorreyPines Therapeutics' ability to continue as a going concern. About Raptor Pharmaceutical Based in Novato, California, Raptor Pharmaceutical Corp. -- http://www.raptorpharma.com/-- is dedicated to speeding the delivery of new treatment options to patients by working to improve existing therapeutics through the application of highly specialized drug targeting platforms and formulation expertise. The Company focuses on underserved patient populations where it can have the greatest potential impact and currently has product candidates in clinical development designed to treat nephropathic cystinosis, non-alcoholic steatohepatitis, Huntington's Disease, aldehyde dehydrogenase deficiency and a non-opioid solution designed for chronic pain. The Company's preclinical programs are based upon bioengineered novel drug candidates and drug-targeting platforms derived from the human receptor-associated protein and related proteins that are designed to target cancer, neurodegenerative disorders and infectious diseases. The audit report of Burr, Pilger & Mayer, LLP, independent registered public accounting firm, included in Raptor Pharmaceuticals' Annual Report on Form 10-K for the year ended August 31, 2008, contained an explanatory paragraph describing conditions that raise substantial doubt about Raptor's ability to continue as a going concern. RAWHIDE OPERATING: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Rawhide Operating, Inc. P.O. Box 700 Telferner, TX 77908 Bankruptcy Case No.: 09-53953 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Western District of Texas (San Antonio) Judge: Bankruptcy Judge Leif M. Clark Debtor's Counsel: R. Glen Ayers, Jr., Esq. Langley and Banack, Inc 745 E Mulberry, 9th Floor San Antonio, TX 78212 Tel: (210) 736-6600 Fax: (210) 735-6889 Email: gayers@langleybanack.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/txwb09-53953.pdf The petition was signed by Bennie Sparkman, president of the Company. RESERVE PRIMARY: WilmerHale Withdraws Representation in SEC Suit ---------------------------------------------------------------- According to Law360, Reserve Management Co. Inc. and its two top executives have given their consent for WilmerHale LLP to stop representing them in a suit brought by the U.S. Securities and Exchange Commission accusing them of hiding their fund's exposure to Lehman Brothers Holdings Inc. As previously reported by the TCR, U.S. District Judge Paul Gardephe in New York said at a hearing on Sept. 23 that he will consider a plan by the Securities and Exchange Commission that may lead to lawsuits against investors who took money from the failed Reserve Primary Fund before it shut off redemptions a year ago. The report relates that part of the plan would have a court- appointed monitor make recommendations on whether there is a basis to file so-called clawback suits against investors whose payouts were excessive. Under the plan, a judge would decide whether such suits would go forward. The SEC said it hasn't endorsed clawback suits. Opponents of the SEC's distribution plan include New York-based Time Warner Inc. and the state of Massachusetts, which objects to the potential clawback suits. The SEC sued managers of Reserve Primary, accusing them of misleading shareholders about the safety of the fund after it suffered losses on Lehman Brothers Holdings Inc. debt. The case is SEC v. Reserve Management, 09-cv-4346, U.S. District Court, Southern District of New York (Manhattan). Managed by Reserve Management Company, Inc., the Reserve Primary Fund is a large money market mutual fund that is currently in liquidation. On September 16, 2008, during the global financial crisis, it lowered its share price below $1 because of exposure to Lehman Brothers debt securities. This resulted in demands from investors to return their funds as the financial crisis mounted. The Reserve had multiple other funds frozen because of this failure. ROCKWOOD SPECIALTIES: Fitch Affirms Issuer Default Rating at 'B' ---------------------------------------------------------------- Fitch Ratings has affirmed the Issuer Default Rating and outstanding debt ratings on Rockwood Specialties Group, Inc.: -- IDR at 'B'; -- Senior secured revolving credit facility at 'BB/RR1'; -- Senior secured term loans at 'BB/RR1'. Fitch has also downgraded the senior subordinated notes to 'B-/RR5' from 'B/RR4' given reduced recovery prospects on the issue taking into account the 100% recovery prospects on the senior secured facilities and carving out the Titanium Dioxide Venture earnings and facilities. The Rating Outlook is Negative. Rockwood's ratings reflect leading positions in many of its product lines, diversification by market and end-use, and good profit margins. Financial leverage is high and expected to remain so over the next 12-18 months given reduced earnings. Fitch expects total debt/Operating EBITDA (as calculated by Fitch) to exceed 5.5x for the period. Liquidity is quite strong with cash on hand at June 30, 2009, of $197.7 million and $224.3 million available under the company's $250 million revolver of which, $70 million expires July 30, 2010, and $180 million expires in 2012. Fitch expects cash generation after $160-$180 million capital expenditures for 2009 to comfortably service debt. Fitch estimates that scheduled amortization is moderate over the next two years. The company has improved its liquidity through an amendment to its senior secured credit facilities completed on June 15, 2009 where $1.2 billion of term loans due 2012 were repaid with new notes due 2014. The company used cash on hand to purchase $153.2 million in principal of its subordinated notes at a discount as well as prepaying $102.3 million of its senior secured term loans. The amendment of net debt/Adjusted EBITDA covenant in favor of a net senior secured debt covenant allows for room to borrow under the revolver. For the twelve-month period ended June 30, 2009, the covenant maximum was 4.40:1.00, and the actual level was 3.27:1.00. The Negative Outlook reflects Fitch's expectations that earnings and cash flows will continue to be impacted by exposure to weakness in cyclical end markets such as construction and automotives. Rockwood has been able to generate $130.6 million of net cash provided by operating activities that resulted in $49 million of free cash flow after $81.2 million of capital expenditures during the first half of 2009. Fitch expects stronger cash generation in the second half of 2009 given that the first quarter is seasonally weak. Deteriorating operating results which result in a cash drain could result in a downgrade. Rockwood has strong liquidity, which should benefit it over the down-cycle. Any acquisitions that result in materially higher leverage or a substantial weakening of liquidity could result in a downgrade. Rockwood is a global developer, manufacturer and marketer of high value-added specialty chemicals and advanced materials used for industrial and commercial purposes. Rockwood generated Adjusted EBITDA of $561 million on $2,971 million in revenues for the LTM ending June 30, 2009. RONALD EBBERTS: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Ronald R. Ebberts dba Ebberts Construction aka Ron R Ebberts Barbara A. Ebberts aka Barbara Ebberts P.O. Box 250 Egnar, CO 81325 Bankruptcy Case No.: 09-31076 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Sidney B. Brooks Debtors' Counsel: Guy B. Humphries, Esq. 1801 Broadway, Suite 1100 Denver, CO 80202 Tel: (303) 832-0029 Fax: (303) 382-4165 Email: guyhumphries@msn.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 5 largest unsecured creditors is available for free at: http://bankrupt.com/misc/cob09-31076.pdf The petition was signed by the Joint Debtors. ROYAL HAWAIIAN: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Royal Hawaiian Showroom LLC 1580 Makaloa Street, Suite 1200 Honolulu, HI 96814 Case No.: 09-02334 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Hawaii (Honolulu) Judge: Bankruptcy Judge Robert J. Faris Debtor's Counsel: Jerrold K. Guben, Esq. Reinwald O'Connor & Playdon 733 Bishop St., Fl. 24 Honolulu, HI 96813 Tel: (808) 524-350 Fax: (808) 531-8628 Email: jkg@roplaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Roy Tokujo, the company's manager. Entity Nature of Claim Claim Amount ------ --------------- ------------ Taisei Construction Company Construction of $4,648,045 680 Iwilei Road, Suite 670 Improvements Honolulu, Hawaii 96817 Realisations Show Development $543,944 7275 Saint Urbain, Suite 670 Honolulu, Hawaii 96813 Central Pacific Bank Bank Loan, Lease, $693,259 220 South King Street, Line of Credit Suite 400 Honolulu, Hawaii 96813 B.P. Bishop Estate Lease Payments, $693,259 2201 Kalakaua Avenue, Utilities Suite A500 Honolulu, Hawaii 96815 Lawrence Rodriguez, LLC Consulting Services $183,246 American Bar and Restaurant Construction and $118,253 Supply furniture and fixtures Millici, Valenti, Ng, Pack Advertising Services $101,195 Solotech, Inc. Theater Equipment $82,180 and Installation First Hawaiian Bank Bank Credit Card $60,276 Watanabe, Ing, Kawashima Legal Services $57,591 Fire Fly Website Design and $51,201 Hosting Gilford Sato & Associates, Accounting Services $37,356 CPAs Flemming Creative Concepts Sponsorship Services $33,118 Roy K. Yamamoto Architect Services $26,245 Harris Company Construction $21,907 Consulting Services Furitano & Sato Legal Services $18,186 Silver State Wire Rope Equipment Rental/ $17,750 Purchase Hawaii Stage and Lighting Equipment Rental $14,269 Rentals Computant Equipment and $13,697 Computer/Networking Type Services Progressive Telcom, LLC Telecom Equipment $13,102 and Products RPM INTERNATIONAL: Moody's Assigns 'Ba1' Subordinate Shelf Rating ----------------------------------------------------------------- Moody's Investors Service assigned a Baa3 rating to RPM International, Inc.'s proposed $250 million guaranteed senior unsecured notes due 2019. Proceeds from the notes will be used to refinance $164 million of debt maturing in October 2009 along with a portion of the $120.0 million in principal amount of short term borrowings outstanding under an accounts receivable securitization program, which allows for $150.0 million in borrowings through April 6, 2012. Moody's also affirmed RPM's existing Baa3 senior unsecured ratings. The outlook remains stable. "RPM's Baa3 rating incorporates Moody's view that RPM is supported by relatively stable financial metrics and a diverse product portfolio," said Moody's analyst Bill Reed. The company's credit profile continues to benefit from a diverse portfolio of products that supply various consumer and industrial end-markets. Furthermore, RPM has many well-known brand names including Rust-Oleum, Bondo, Zinsser, and DAP. Most of RPM's products are specialty coatings and sealants with applications in corrosion control, waterproofing, sealing, flooring and roofing. The ratings affirmation reflects Moody's continued belief that RPM will meet the retained free cash flow to debt ratio and asbestos settlement cost (including defense cost) thresholds Moody's referenced in Moody's June 16, 2008 Issuer Comment. This summarizes the ratings activity: Ratings assigned: RPM International Inc. * Proposed senior unsecured notes due 2019 -- Baa3 Ratings affirmed: RPM International Inc. * Senior unsecured notes - Baa3 * Senior unsecured shelf - (P)Baa3 * Subordinate shelf - (P)Ba1 RPM United Kingdom G.P * Guaranteed senior unsecured notes -- Baa3 The Baa3 rating reflects Moody's expectation that RPM will not pursue large debt financed acquisitions and instead continue its historic focus on bolt-on acquisitions and joint ventures to augment organic growth. Additionally, RPM's rating is tempered by an elevated dividend and the expectation that management will continue to raise the dividend as earnings increase. RPM's renewal of its accounts receivable facility for three years and the amendment to its $400 million revolver due December 2011 relaxing the covenants are, on the margin, a credit positive. The altered covenant definitions plus the addition of a new fixed charge ratio covenant serve to both relax and in some ways provide the potential for future discipline on capex and dividend cash flows which form a portion of the denominator of the covenant. This ratio, which is required to be 1.00 to 1.00, may exhibit some possible tightness, given the global recession, during fiscal 2010 (ending May 31, 2010). This tightness, however, could be remedied with discipline in capex and dividend policies along with the benefit of cost cutting initiatives which should bolster EBITDA. RPM's stable outlook reflects the improved trends with regard to its asbestos liabilities. It appears that the decrease in new asbestos cases filed, as well as the decrease in average dollar value of settlements is a sustainable trend. Further reflected in the stable outlook is the generation of stable cash flows along with management's record of maintaining a relatively conservative financial profile. If annual pre tax asbestos settlement amounts, including defense costs, were to exceed $75 million, or if the ratio of retained cash flow to total adjusted debt were to drop to below 20%, on a sustained basis, or if a large debt financed acquisition or share repurchase program were to cause this ratio to decline to below 20% a review or lower ratings may be triggered. If management becomes more aggressive with its dividend policy, significantly increases its share repurchases, or takes other actions that are likely to materially weaken credit metrics, Moody's could reassess the appropriateness of the company's Baa3 ratings. Moody's most recent announcement concerning the ratings for RPM was on January 28, 2008, when the Baa3 ratings were affirmed and the outlook was moved to stable from negative. RPM International Inc., headquartered in Medina, Ohio, is a holding company, whose subsidiaries are manufacturers of specialty coating and other products for both industrial/professional and retail do-it-yourself markets. Sales on an LTM basis ending August 31, 2009, were $3.3 billion. RRI ENERGY: Increases Size of Cash Tender Offer ----------------------------------------------- RRI Energy, Inc., on October 5, 2009, increased the "Maximum Acceptance Amount" for its cash tender offer to purchase its outstanding 6.75% Senior Secured Notes due 2014 and Pennsylvania Economic Development Financing Authority's outstanding Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project) Series 2001A, 2002A, 2002B, 2003A and 2004A. As contemplated in the Offer to Purchase dated September 21, 2009, as supplemented, RRI increased the Maximum Acceptance Amount to $200,000,000 aggregate principal amount of Notes and Bonds and is now offering to purchase up to that aggregate principal amount of Notes and Bonds on the terms and conditions set forth in the Offer to Purchase. RRI also extended the "Early Participation Deadline" for the Tender Offer to 12:00 midnight, New York City time, on October 19, 2009, which is the expiration time of the Tender Offer. The Early Participation Deadline was previously set to be 5:00 p.m., New York City time, on October 5, 2009. As described in the Offer to Purchase, holders of Notes or Bonds who validly tender their Notes or Bonds at or prior to the Early Participation Deadline will be eligible to receive the applicable "Total Consideration," which includes an early participation payment of $20 per $1,000 principal amount of Notes or Bonds tendered and accepted for purchase in the Tender Offer. RRI Energy on September 21, 2009, commenced a cash tender offer to purchase up to $150,000,000 aggregate principal amount of the securities: Total Principal Early Consideration Title of Amount Participation (Acceptable Bid Security Outstanding Payment Price Range) -------- ----------- ------------- --------------- RRI Energy, Inc. 6.75% Senior Secured Notes due 2014 $437,239,000 $20 $980 - $1,020 Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project): $20 $960 - $1,000 Series 2001A $150,000,000 Series 2002A $75,000,000 Series 2002B $75,000,000 Series 2003A $100,000,000 Series 2004A $100,000,000 The Principal amount outstanding includes an aggregate of approximately $92 million of Bonds held by the Company. Holders who validly tender (and do not validly withdraw) Notes or Bonds at or prior to 5:00 p.m., New York City time, on October 5, 2009 (as may be extended by the Company, the "Early Participation Deadline") will receive the applicable "Total Consideration" (as described below), which includes an early participation payment of $20 per $1,000 principal amount of Notes or Bonds tendered and accepted for payment in the Tender Offer. Holders who validly tender (and do not validly withdraw) Notes or Bonds after the Early Participation Deadline and at or prior to the Expiration Time will receive the Total Consideration minus the Early Participation Payment. As of 5:00 p.m., New York City time, on October 5, 2009, $129,647,000 in aggregate principal amount of Notes and Bonds had been validly tendered and not validly withdrawn. The purchase price for Notes and Bonds will be determined in accordance with a modified Dutch auction procedure on the terms and conditions set forth in the Offer to Purchase. Holders no longer have the right to withdraw tendered Notes or Bonds. The Tender Offer is conditioned upon the satisfaction or waiver of certain conditions as described in the Offer to Purchase. RRI has retained Deutsche Bank Securities Inc. to act as the dealer manager for the Tender Offer and has retained Global Bondholder Services Corporation to act as the Information Agent and Depositary for the Tender Offer. Questions regarding the Tender Offer should be directed to the Dealer Manager at 800-553- 2826 (toll-free) or 212-250-7772 (collect). Requests for documentation should be directed to the Information Agent at 212- 430-3774 (for banks and brokers only) or 866-952-2200 (for all others toll-free). About RRI Energy RRI Energy, Inc. (NYSE:RRI) -- http://www.rrienergy.com/-- based in Houston, provides electricity to wholesale customers in the United States. The company is one of the largest independent power producers in the nation with more than 14,000 megawatts of power generation capacity across the United States. These strategically located generating assets use natural gas, fuel oil and coal. SJT VENTURES LLC: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: SJT Ventures, LLC 8001 LBJ Freeway 3rd Floor Dallas, TX 75251 Bankruptcy Case No.: 09-36758 Chapter 11 Petition Date: October 5, 2009 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Arthur I. Ungerman, Esq. One Glen Lakes Tower 8140 Walnut Hill Ln., No. 301 Dallas, TX 75231 Tel: (972) 239-9055 Fax: (972) 239-9886 Email: arthur@arthurungerman.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by S.K. Mohan, president of the Company. SMURFIT-STONE: Appoints Tom Gibson as VP of Sheet Feeder Region --------------------------------------------------------------- Smurfit-Stone Container Corporation announced that Tom Gibson has been named vice president and general manager of its Sheet Feeder region, which includes the company's Milwaukee IPC and Bedford Park and Hanover Park, IL, sheet feeder plants. "Tom's industry experience and solid leadership skills will help strengthen our industry-leading position in this important area of our business and enhance our ability to provide exceptional service to our customers," said Steve Strickland, senior vice president and general manager of Smurfit-Stone's Container division. A 25-year industry veteran, Mr. Gibson has served in a variety of sales and management positions throughout his career, including area general manager of Smurfit-Stone's Springfield, Missouri, container plants. He most recently served as business unit sales manager for the company's Sheet Feeder region. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Asks Court to Allow Insurer to Pay Defense Costs --------------------------------------------------------------- Smurfit-Stone Container Corp. ask the Bankruptcy Court to lift the automatic stay to allow Axis Insurance Company, their insurance carrier, to advance insurance proceeds to pay defense costs of certain insured individuals. On July 16, 2009, an amended complaint was filed in the case of Mark W. Mayer, Larry C. Welsh and Brandi Young, individually and on behalf of the Smurfit-Stone Container Corporation Savings Plan, the Jefferson Smurfit Corporation Hourly Savings Plan, the Smurfit-Stone Container Corporation Hourly Savings Plan, and St. Laurant Paperboard Hourly Savings Plan, against the Administrative Committee of the Smurfit-Stone Container Corporation Retirement Plans, Patrick J. Moore, Paul K. Kaufman, Charles Hinrichs, Ron Hackney and Brian Gardner in the United States District Court for the Northern District of Illinois. James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, notes that the Defendants in the ERISA Litigation all are, or were, key executives and officers of the Debtors. He relates that the allegations in the Complaint are extensive and complex, but "essentially boil down to the assertion that the defendants breached their fiduciary duties to the Plans and the individual plaintiffs over the course of more than a year by allegedly making imprudent investments with the Plans' assets, making misrepresentations and failing to disclose material adverse facts concerning the company's business conditions, debt management and viability, and not taking appropriate action to protect the Plans' assets." Subsequently, on June 18, 2009, the Debtors filed a verified complaint in the United States Bankruptcy Court for the District of Delaware against the Plaintiffs seeking an extension of the automatic stay and in conjunction therewith, temporary and preliminary injunctive relief to apply to the ERISA Litigation. The Court has not yet decided whether to grant the relief requested in the Debtors' verified complaint. Prior to the Petition Date, the Debtors purchased three fiduciary insurance policies: (i) a primary policy through Axis, with a $10,000,000 aggregate coverage maximum and a $100,000 deductible per claim, (ii) an excess policy through the Chubb Group of Insurance Companies that adds $10,000,000 to the available aggregate coverage and (iii) a second excess policy through Navigators Insurance Company that adds $5,000,000 more in aggregate coverage. Pursuant to the terms of the Primary Policy, coverage extends to the Debtors and any individuals who are past, present or future directors, officers, or trustees of the Debtors or of a Plan, in their fiduciary or administrator capacity, with respect to a violation of any of their responsibilities. Mr. Conlan notes that Axis has provided the Debtors with a reservation of rights notice with regard to the Primary Policy and specifically the availability of coverage and the applicability of specific retention provisions. He adds that Axis is prepared to advance defense costs to the defendants in the ERISA Litigation, which are "Insureds" per the terms of Primary Policy. However, Axis is concerned that it may violate the automatic stay by coverage, in the event it is determined that the insurance proceeds under the Primary Policy are property of the Debtors' estates. Out of an abundance of caution, and in an effort to ease the concerns of Axis, the Debtors have asked the Court to lift of the automatic stay. Mr. Conlan says that the Debtors have determined that the benefit to their estates from distributing the proceeds of the Primary Policy on an ongoing basis warrant lifting the automatic stay, to the extent it may apply, without determining whether or to what extent the proceeds of the Primary Policy may constitute property of the Debtors' estates. "Indeed, if such relief is not granted, and the ERISA Litigation defendants do not receive access to the proceeds of the Primary Policy, they may face irreparable harm," Mr. Conlan points out. Moreover, pursuant to the terms of the Plans, the ERISA Litigation defendants each are fully indemnified by the Debtors with respect to their activities and good-faith decisions or actions on behalf of the Administrative Committee of the Plans or as otherwise relating to the administration of the plans, Mr. Conlan notes. For these reasons, Mr. Conlan submits that it is undoubtedly in the Debtors' best interests, and the best interests of the Debtors' estates, to authorize Axis to advance defense costs to the defendants in the ERISA Litigation. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Canada Hearing on Finance II Interests on Oct. 7 --------------------------------------------------------------- Deloitte & Touche, Inc., the monitor in the proceedings under the Companies' Creditors Arrangement Act commenced by Smurfit-Stone Container Canada, Inc., et al., delivered its sixth monitor report to the Superior Court of Justice (Commercial List) for the Province of Ontario, in Canada. The Monitor informs the Court that the purpose of the Sixth Report is to provide an update of: -- the ongoing operations of the CCAA Entities; -- the Chapter 11 proceedings; -- the DIP facility; -- critical suppliers and pre-CCAA expenses; -- pension and other employee matters; -- the cash flow forecast and results relative to forecast; -- revised cash flow forecast; -- restructuring efforts to date; -- the claims process; -- other matters; and -- the Monitor's recommendations. The Monitor relates that since January 26, 2009, the CCAA Entities have worked diligently to stabilize their operations and have maintained operations in the normal course during the CCAA Proceedings. SSC Canada continues to sell products to its customers and has obtained the necessary supplies from its suppliers. On July 28, 2009, SSC Canada announced the permanent closure of the container plant located in Edmonton, Alberta and approximately 47 jobs were affected. With regard to the DIP Facility, the Monitor notes that as of September 4, 2009, there have not been any net additional borrowings by SSC Canada. As of September 22, 2009, SSC Canada has outstanding borrowings of $35,000,000 under the Canadian term loan facility. During the week ending September 25, 2009, SSC Canada has forecast a repayment of $27,200,000 on the DIP term loan facility using the funds received from the sale of certain timberland assets in the province of Quebec to Societe Generale de Financement du Quebec in accordance with the terms of the DIP agreement. The Monitor further notes that there are no outstanding borrowings under the Canadian DIP revolving facility. SSC Canada's management has completed its review of the 2008 actual centralized services costs for the fiscal year ending December 31, 2008, and has determined that an adjustment of the monthly centralized services charge is required, the Monitor tells the Court. It notes that the estimated monthly centralized service charge to be paid to SSC U.S. by SSC Canada on behalf of the CCAA Entities for fiscal 2009 is $610,000. However, SSC Canada has been reimbursed by SSC U.S. for the overpayments made during the CCAA period which were based on prior centralized service charge estimates. The Monitor reveals that SSC U.S. and SSC Canada continue to receive payments of receivables on behalf of each other. SSC Canada continues to track the intercompany receivables and payables on a daily basis and then the respective accounts are settled once per month. The Monitor says that the last settlement was made on August 31, 2009, for the July intercompany accounts. Furthermore, the Monitor notes that Aurelius Capital Management LP and Columbus Hill Capital Management LP have served a notice of motion in the CCAA Proceedings which seeks, among other things, an order declaring that the interests of the officers and directors of Stone Container Finance Company of Canada II, the Monitor and counsel to the CCAA Entities, conflict irreconcilably with the interests of Finance II. The motion is scheduled to be heard on October 7, 2009. A full-text copy of the Monitor's Report is available for free at http://bankrupt.com/misc/SSC6thMonRep.pdf About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: CCAA Stay for SSC Canada Extended to Dec. 24 ----------------------------------------------------------- Smurfit-Stone Canada Inc. and its affiliates sought and obtained an order from the Honorable Justice J. Pepall at the Superior Court of Justice (Commercial List) for the Province of Ontario, in Canada, further extending the stay of proceedings through December 12, 2009. Sean F. Dunphy, Esq., at Stikeman Elliot LLP, in Ontario, Canada, relates that since the granting of the initial order extending the stay, they have worked diligently to stabilize their operations and with the assistance of the DIP Credit Agreement, they have been able to reassure customers and suppliers, and maintain operations. Mr. Dunphy tells the Superior Court that the CCAA Entities have acted and continue to act in good faith and with due diligence. He explains that an extension of the stay of proceedings to December 24, 2009, is necessary in order to continue to ensure stability to the CCAA Entities' business while they work diligently on preparing a restructuring plan that will maximize long-term value for the benefit of all stakeholders. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs roughly 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported roughly $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SPANSION INC: Apple Serves Notice to Retain Rights to Spansion IP ----------------------------------------------------------------- Apple Inc., provides notice of its election to retain all of the rights to Spansion Inc.'s intellectual property provided to it under an agreement it entered on February 10, 2009. The notice comes as a result of the Court's September 1, 2009 Order granting motion by Spansion to reject the Spansion/Apple Agreement. Pursuant to its election, Apple reserves the right to file claims under the Spansion/Apple Agreement. As reported by the TCR on Sept. 22, 2009, Judge Kevin Carey authorized Spansion Inc. and its affiliates to reject their executory contract with Apple Inc. Judge Carey also overruled the objection raised by Apple. The Judge directed Apple to file claims for damages arising as a result of the rejection of the Agreement within 30 days after the entry of the Court's order. Spansion Inc. entered into a Letter Agreement with Apple Inc., pursuant to which Spansion agreed to dismiss Apple from a complaint it filed with the International Trade Commission. However, in a motion filed with the Court, the Debtors sought to reject the Letter Agreement asserting that Spansion's relationship with Apple is not sufficiently profitable to justify dismissal in the ITC Action. About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Spansion Inc. and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) SPANSION INC: Gets Nod to Continue Ernst & Young's Services ----------------------------------------------------------- Spansion Inc. and its units obtained approval from Bankruptcy Judge Kevin Carey to continue to employ Ernst & Young LLP as their independent auditors, nunc pro tunc to August 26, 2009. The Debtors wish to continue Ernst & Young's services because: (a) Ernst & Young has extensive experience with auditing public companies like the Debtors; (b) Ernst & Young was the Debtors' prepetition auditor and is, therefore, familiar with the Debtors' corporate structure and businesses; and (c) Ernst & Young has developed a great deal of institutional knowledge regarding the Debtors' operations, finances, and systems. Accordingly, the Debtors want Ernst & Young to continue to provide them with auditing services for the 2009 fiscal year ending on December 27, 2009. A full-text copy of Ernst & Young's August Engagement Letter is available for free at: http://bankrupt.com/misc/Spansion_E&YAugustEngagement.pdf The Debtors will pay Ernst & Young $1,371,731 for an integrated audit and review for each quarter for fiscal 2009. In addition to the Fee, Ernst & Young will charge the hourly rates in the August Engagement Letter for special audit-related projects that are integral to the performance of the audit services. The Debtors will also reimburse Ernst & Young for necessary expenses. John Kispert, chief executive officer and President of Spansion Inc., assures the Court that Ernst & Young is a "disinterested person" as that phrase is defined in Section 101(14) of the Bankruptcy Code as modified by Section 1107(b). About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Spansion Inc. and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) SPANSION INC: Giles Delfassy, Director, Acquires Stock ------------------------------------------------------ In a Form 4 filing with the U.S. Securities and Exchange Commission, Gilles Delfassy, a director of Spansion Inc., disclosed that he acquired 1,250 shares of Spansion Inc., Class A Common Stock. At the end of the transaction, Mr. Delfassy beneficially owned 13,125 shares of Spansion stock. In addition, Mr. Delfassy disclosed that he disposed of 1,250 derived Restricted Stock Units on September 20, 2009. At the end of the transaction, Mr. Delfassy beneficially owned 10,000 derived shares of the company. Each restricted stock unit represents a contingent right to receive one share of Spansion Inc. Class A Common Stock. There is no exercise price or expiration date. Restricted stock units were granted to Mr. Delfassy on September 20, 2007, and vest over a four-year period. One quarter of the shares subject to the award vested on the one year anniversary date. The remaining shares subject to the award vest in equal installments quarterly, until 100% vested on September 20, 2011. Vested shares are delivered to the reporting person on each vesting date. About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Spansion Inc. and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) SPANSION INC: Jefferies Leveraged Buy Claims -------------------------------------------- In separate Court filings for the period from September 18, 2009, through September 24, 2009, five of the Debtors' creditors disclosed that they intend to transfer each of their claims against the Debtors: Transferor Transferee Amount ---------- ---------- ------ Semitool, Inc. Jefferies Leveraged Credit Products, LLC $142,178 M+W Zander U.S. Ops, Inc. Jefferies Leveraged Credit Products, LLC 54,729 Brewer Science, Inc. Argo Partners 37,515 Nationwide Hytech Equipment Jefferies Leveraged Consultants Credit Products, LLC 26,700 Keterex, Inc. Argo Partners unspecified In separate Court filings for the period September 18 to October 1, 2009, two of the Debtors' creditors disclosed that they intend to transfer each of their claims against the Debtors: Transferor Transferee Amount ---------- ---------- ------ Software House Corporation Jefferies Leveraged Credit Products, LLC 14,081 Reading is Fundamental of Austin Argo Partners - About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Spansion Inc. and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) SPECTRUM BRANDS: Moody's Assigns Corporate Family Rating at 'B3' ---------------------------------------------------------------- Moody's Investors Service assigned a B3 corporate family rating to Spectrum Brands following its recent emergence from bankruptcy proceedings. At the same time, Moody's assigned a B3 probability of default rating, a B3 rating to the senior secured term loan, a Caa2 rating to the subordinated notes and an SGL 2 liquidity rating. The rating outlook is stable. The B3 corporate family rating reflects Spectrum's moderating credit metrics highlighted by relatively high financial leverage of around 6x and history of decreasing operating margins. The rating also reflects competition from well known and well capitalized companies across most business lines and by the company's history of operating struggles. The rating is further constrained by the need to refinance more than $1 billion of maturing bank debt in less than three years and by the potential for its new single largest equity owner, Harbinger Capital, to be shareholder friendly with its financial policies. The rating is supported by Spectrum's significant size with revenue of over $2.4 billion, diversified product offerings, portfolio of recognized brands, strong market positions in many product categories and its long-standing relationships with key retailers. The ratings also benefit from Spectrum's increasing international penetration, recent decision to exit the highly weather dependent fertilizer and seed part of its lawn & garden business and moderate price points of its products. The SGL 2 speculative grade liquidity rating reflects Moody's belief that Spectrum will possess a good liquidity profile over the next 12 months highlighted by cash of around $60 million, Moody's expectation of more than $50 million of free cash flow, sufficient cushion under its financial covenants and access to a $197 million ABL revolving credit facility, excluding the $45 million supplemental loan. Spectrum's liquidity profile is constrained by the existence of quarterly maintenance leverage financial covenant that contractually adjust over the next two years, and by the maturity in June 2012 of the $1.3 billion term loan. "The stable outlook reflects Moody's expectation that Spectrum will continue to posses a good liquidity profile and that its profitability will likely stay at or slightly improve from its current level over the next year" said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. The stable outlook also reflects Moody's expectation that Spectrum will not materially increase debt in the near term either for acquisitions or to fund shareholder returns. These ratings/assessments were assigned: * Corporate family rating at B3; * Probability of default rating at B3; * $1.3 billion senior secured term loan due June 2012 at B3 (LGD 3, 49%); * $218 senior subordinated notes due 2013 at Caa2 (LGD 6, 92%); Headquartered in Atlanta, Georgia, Spectrum Brands, Inc., is a global consumer products company with a diverse product portfolio including consumer batteries, lawn and garden, electric shaving and grooming, and household insect control. Sales for the twelve months ended June 30, 2009, approximated $2.6 billion. The last rating action was taken on February 25, 2009, when Moody's withdrew Spectrum's ratings after it filed for bankruptcy protection. STALLION OILFIELD: Reaches Deal in Principle With Working Group --------------------------------------------------------------- http://www.marketwatch.com/story/stallion-oilfield-services-ltd- reaches-agreement-in-principle-with-a-working-group-of-secured- lenders-sub-committee-of-debtholders-and-its-key-equityholders-to- significantly-reduce-debt-and-restructure-2009-10-07 (rousel/pr) Stallion Oilfield Services Ltd. has reached an agreement in principle with a working group of secured lenders, a sub-committee of debtholders, and its key equityholders to significantly reduce debt and restructure the company's balance sheet. On October 7, 2009, Stallion reached an agreement in principle with the working group of its secured lenders and a sub-committee of its unsecured noteholders and lenders under its unsecured bridge facility that would eliminate approximately $515 million of the company's unsecured debt, as well as $26 million of accrued interest. This debt reduction would reduce annual cash interest costs by approximately $43 million and provide Stallion with the financial flexibility to continue providing quality customer service while maintaining the highest level of safety in operations through investments in people, equipment and technology. The company is performing well across all primary service lines despite the overall economic downturn and the nearly 50% reduction in the size of its market. "We are resilient because of our employees, our sound business model, strong leadership team and excellent cash position," said Mr. Craig Johnson, Stallion's Chief Executive Officer. "We've made the right moves operationally, but the Company has a significant debt burden that is inconsistent with the current market trends," said Mr. Johnson. "We are delighted that our lenders appreciate the opportunities that exist for Stallion in a recovering oil and gas market, and we're working together to ensure Stallion is poised to capitalize on those opportunities," said Mr. Johnson. Support for the agreement is currently being solicited by the Company from its broader lender and noteholder constituencies. If approved, the terms of the restructuring agreement would provide that: (a) the Company's secured lenders would receive approximately $33 million in principal payments reducing the Company's obligations outstanding under the Company's secured credit agreement, (b) approximately $258 million in obligations outstanding under the Company's unsecured bridge loan agreement and approximately $283 million in obligations outstanding on account of the 9.75% unsecured notes due February 1, 2015 would be converted on a pro rata basis for 98% of the common equity in the reorganized Stallion, and (c) the Company's existing equityholders would receive 2% of the common equity and warrants to purchase 1% of the common equity in reorganized Stallion. The restructuring agreement would be implemented as part of a chapter 11 case that Stallion would file in the near future. The proposed chapter 11 plan of reorganization will include key initiatives to ensure the filing has little or no impact on Stallion's operations and its employees, customers, vendors and suppliers. For example, Stallion will immediately seek court approval of a motion ensuring no interruption in the payment of employee wages and benefits, and an "all trade" motion in which Stallion will treat all trade creditors as "unimpaired" and could pay vendors for goods and services delivered both before and after the filing in the normal course. During its restructuring, Stallion will continue normal operations under its current ownership structure and does not anticipate any changes to its overall business or its ability to meet customer needs. Customers, vendors, suppliers and others seeking more information about Stallion's restructuring may contact Stallion at 1-888-290- 6621. About Stallion Houston, Tex.-based Stallion Oilfield Services Inc. is an oilfield service company that provides wellsite support services and construction and logistics services to exploration and production companies and drilling contractors throughout the United States. STALLION OILFIELD: To File Chapter 11 with Plan to Cut $515MM Debt ------------------------------------------------------------------ Stallion Oilfield Services Ltd. on October 7 announced that it has reached an agreement in principle with a working group of secured lenders, a sub-committee of debtholders, and its key equityholders to significantly reduce debt and restructure the Company's balance sheet. On October 7, 2009, Stallion reached an agreement in principle with the working group of its secured lenders and a sub-committee of its unsecured noteholders and lenders under its unsecured bridge facility that would eliminate approximately $515 million of the Company's unsecured debt, as well as $26 million of accrued interest. This debt reduction would reduce annual cash interest costs by approximately $43 million and provide Stallion with the financial flexibility to continue providing quality customer service while maintaining the highest level of safety in operations through investments in people, equipment and technology. The Company says it is performing well across all primary service lines despite the overall economic downturn and the nearly 50% reduction in the size of its market. "We are resilient because of our employees, our sound business model, strong leadership team and excellent cash position," said Mr. Craig Johnson, Stallion's Chief Executive Officer. "We've made the right moves operationally, but the Company has a significant debt burden that is inconsistent with the current market trends," said Mr. Johnson. "We are delighted that our lenders appreciate the opportunities that exist for Stallion in a recovering oil and gas market, and we're working together to ensure Stallion is poised to capitalize on those opportunities," said Mr. Johnson. Support for the agreement is currently being solicited by the Company from its broader lender and noteholder constituencies. If approved, the terms of the restructuring agreement would provide that: (a) the Company's secured lenders would receive approximately $33 million in principal payments reducing the Company's obligations outstanding under the Company's secured credit agreement, (b) approximately $258 million in obligations outstanding under the Company's unsecured bridge loan agreement and approximately $283 million in obligations outstanding on account of the 9.75% unsecured notes due February 1, 2015, would be converted on a pro rata basis for 98% of the common equity in the reorganized Stallion, and (c) the Company's existing equityholders would receive 2% of the common equity and warrants to purchase 1% of the common equity in reorganized Stallion. The restructuring agreement would be implemented as part of a Chapter 11 case that Stallion would file in the near future. The proposed Chapter 11 plan of reorganization will include key initiatives to ensure the filing has little or no impact on Stallion's operations and its employees, customers, vendors and suppliers. For example, Stallion will immediately seek court approval of a motion ensuring no interruption in the payment of employee wages and benefits, and an "all trade" motion in which Stallion will treat all trade creditors as "unimpaired" and could pay vendors for goods and services delivered both before and after the filing in the normal course. During its restructuring, Stallion will continue normal operations under its current ownership structure and does not anticipate any changes to its overall business or its ability to meet customer needs. Customers, vendors, suppliers and others seeking more information about Stallion's restructuring may contact Stallion at 1-888-290- 6621. About Stallion Oilfield Stallion Oilfield Services Ltd. provides wellsite support services and production & logistics services to the oil and natural gas industry with 1,700 employees in 65 locations. Stallion's range of critical wellsite services include onshore and offshore workforce accommodations and remote camp complexes, surface rental equipment, solids control, communication services, wellsite construction, rig relocation, heavy equipment hauling, fluids handling and logistics. Stallion's Everything but the Rig SM product offerings are designed to improve living and working conditions, safety and our customers' productivity at the wellsite. Stallion is headquartered in Houston, Texas and delivers products and services in South Texas, Gulf Coast, Ark-La- Tex, Ft. Worth Basin, Permian Basin, Mid Continent, Alaska's Prudhoe Bay, the Marcellus Shale and Rocky Mountain regions as well as to the global offshore industry. Additional information may be found at http://www.stallionoilfield.com/ STANDARD MOTOR: Registration of Securities Declared Effective ------------------------------------------------------------- Standard Motor Products, Inc., said Wednesday the Form S-3 Registration Statement under the Securities Act of 1933 -- in connection with its plan to offer, from time to time, up to $75,000,000 of any combination of the securities, either individually or in units -- became effective. On Monday, the Company filed with the Securities and Exchange Commission Amendment No. 1 to the Registration Statement to amend the Registration Statement to delay its effective date. The Registration Statement became effective October 7, 2009, at 3:00 p.m. The Company may offer under the Registration Statement common stock or preferred stock upon conversion of debt securities, common stock upon conversion of preferred stock, or common stock, preferred stock or debt securities upon the exercise of warrants. The securities may be offered and sold by the Company in one or more offerings with a total aggregate principal amount or initial purchase price not to exceed $75,000,000. The Company intends to use the net proceeds from the sale of the securities in the prospectus and any prospectus supplement to repay a portion of the Company's outstanding indebtedness under the Company's revolving credit facility. The Company then intends to borrow funds from time to time under the revolving credit facility for general corporate purposes, which could include: -- Working capital; -- Capital expenditures; and -- Acquisitions. The Company is currently authorized by its Restated Certificate of Incorporation, as amended, to issue up to 30,000,000 shares of common stock, $2 par value per share, and 500,000 shares of preferred stock, $20 par value per share, of which 30,000 shares of preferred stock have been designated as Series A Participating Preferred Stock and reserved for future issuance. As of September 30, 2009, there were 19,060,855 shares of common stock outstanding held of record by 544 holders of record, and no shares of preferred stock outstanding. The Company's common stock is traded on the New York Stock Exchange under the symbol "SMP." On October 2, 2009, the sale price for the Company's common stock on the New York Stock Exchange was $13.93 per share. A copy of Amendment No. 1 to Form S-3 Registration Statement is available at no charge at http://ResearchArchives.com/t/s?468e About Standard Motor Standard Motor Products, Inc. (NYSE: SMP), headquartered in Long Island City, New York, is a manufacturer and distributor of replacement parts for the automotive aftermarket industry. The company is organized into two principal divisions: (i) Engine Management (ignition and emission parts; ignition wires; battery cables; and fuel system parts) and (ii) Temperature Control (air conditioning compressors; other air conditioning parts; and heater parts). Standard Motor's annualized revenues currently approximate $775 million. * * * As reported by the Troubled Company Reporter on July 17, 2009, Moody's Investors Service withdrew all ratings of Standard Motor Products' after the only rated debt having been redeemed upon maturity. Ratings withdrawn include the Corporate Family Rating at Caa1, and $32 million convertible subordinated debentures due July 2009 at Caa2. The last rating action occurred on June 30, 2009, when its CFR was upgraded to Caa1 from Caa2. On June 23, the TCR said Standard & Poor's Ratings Services withdrew its 'CC' corporate credit rating and other debt ratings on Standard Motor Products at the company's request. There is a small amount of rated debt remaining after the recently completed exchange offer. STANT CORP: Manufacturing Plant May be Sold Next Week ----------------------------------------------------- Scott Loftis at pbcommercial.com reports that Stant Corp.'s Stant Manufacturing Inc. plant will likely be sold within the next week, after the U.S. Bankruptcy Court for the District of Delaware approved the sale of the Company's assets to Vapor Acquisition Corp. According to pbcommercial.com, a company official said on Tuesday that the sale shouldn't result in significant changes. Stant Corp. is headquartered in Connersville, Indiana, and has facilities in Pine Bluff, Arkansas, Mexico, China, and the Czech Republic. Founded in 1898, Stant has earned its reputation for quality and innovation in the automotive industry. Stant is recognized as the world's leading supplier of automotive and industrial fuel, oil and radiator caps, fuel vapor control valves and thermostats for both the original equipment markets and the automotive aftermarket. Stant Corp. and five affiliated companies filed for Chapter 11 bankruptcy protection on July 27, 2009 (Bankr. D. Del 09-12647). In its petition, Stant Corp. listed $50 million to $100 million in debts against $50 million to $100 million in assets. Sandra G.M. Selzer, Esq., and Scott D. Cousins, Esq., at Greenberg Traurig, LLP, in Wilmington, Delaware, serve as the Debtors' counsel. STELOR PRODUCTIONS: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Stelor Productions, LLC dba Stelor Group Limited, LLC dba Stelor Technologies, LLC 14701 Mockingbird Drive Darnestown, MD 20874 Bankruptcy Case No.: 09-13445 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court District of Delaware (Delaware) Judge: Brendan Linehan Shannon Debtor's Counsel: Kathleen M. Miller, Esq. Smith, Katzenstein & Furlow LLP 800 Delaware Avenue P.O. Box 410 Wilmington, DE 19899 Tel: (302) 652-8400 Fax: (302) 652-8405 Email: kmiller@skfdelaware.com Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/deb09-13445.pdf The petition was signed by Steven A. Esrig, president of the Company. STEPHEN JOSEPH MAZZERA: Case Summary & 10 Largest Unsec. Creditors ------------------------------------------------------------------ Debtor: Stephen Joseph Mazzera 1340 Dry Creek Rd. Healdsburg, CA 95448 Bankruptcy Case No.: 09-13303 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: David N. Chandler, Esq. Law Offices of David N. Chandler 1747 4th St. Santa Rosa, CA 95404 Tel: (707) 528-4331 Email: DChandler1747@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 10 largest unsecured creditors is available for free at: http://bankrupt.com/misc/canb09-13303.pdf The petition was signed by Mr. Mazzera. SUNBRIDGE PATIO VILLAS: Case Summary & 20 Largest Unsec. Creditors ------------------------------------------------------------------ Debtor: Sunbridge Patio Villas, LLC PO Box 1702 Fayetteville, AR 72702 Bankruptcy Case No.: 09-75035 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- Jerry Duane Jarnagan and Mary Francis Jarnagan 09-75036 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Western District of Arkansas (Fayetteville) Debtor's Counsel: Stanley V. Bond, Esq. Attorney at Law P.O. Box 1893 Fayetteville, AR 72701-1893 Tel: (479) 444-0255 Fax: (479) 444-7141 Email: attybond@me.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/arwb09-75035.pdf The petition was signed by Henry D. Broyles, manager of the Company. SUN-TIMES MEDIA: Court Approves Sale of Assets to Tyree ------------------------------------------------------- Sun-Times Media Group, Inc., said the United States Bankruptcy Court for the District of Delaware on October 8 approved the sale of substantially all of the assets of Sun-Times Media Group to STMG Holdings, LLC, a private investor group led by Chicago businessman James C. Tyree. The total transaction is valued at approximately $25 million and is expected to close by the end of October 2009. The closing remains contingent upon approvals by two of the Company's 16 bargaining units of amendments to their collective bargaining agreements. Those agreements are expected to be reached in the coming days. "This is a very good day for our award-winning newspapers and Web sites, for our incredibly dedicated and hard-working employees and for the Chicago community at large," said Jeremy L. Halbreich, Sun-Times Media Group Chairman of the Board and Interim Chief Executive Officer. "Six months ago, the Company filed for Chapter 11 with the goal of stabilizing the business and ensuring the long-term future of our newspapers and online products. I'm absolutely pleased that we were able to achieve these goals with the investors in STMG Holdings, LLC in such a timely manner." "Mr. Tyree and his co-investors have repeatedly expressed genuine enthusiasm for the newspapers and Web sites and the business as a whole, and have vowed to invest in the business as the newspaper industry continues to transform during a very challenging time. These new owners will work hard to establish a wonderful, long future for our publications and for our employees, and finally, all of the legacy issues and distractions that have followed and negatively affected our products will be put to rest." "All of our employees -- union and non-union -- have taken extraordinary steps to strengthen our organization to become a more efficient Company that is capable of meeting the demand for news and information in this increasingly digital age. We thank them for their sacrifices and loyalty during these tough times." "And we are extremely grateful to our customers -- our advertisers and our readers -- for supporting us. Their loyalty has been deeply appreciated, as has the loyalty of our vendors and suppliers." Sun-Times Media Group's legal advisor is Kirkland & Ellis and its investment banker is Rothschild Inc. Huron Consulting Group is acting as restructuring advisor to the Company. About Sun-Times Media Sun-Times Media Group, Inc. (Pink Sheets: SUTMQ) -- http://www.thesuntimesgroup.com/-- (Pink Sheets: SUTM) owns media properties including the Chicago Sun-Times and Suntimes.com and 58 suburban newspaper titles and corresponding Web sites. The Company and its affiliates conduct business as a single operating segment which is concentrated in the publishing, printing, and distribution of newspapers in greater Chicago, Illinois, metropolitan area and the operation of various related Web sites. The Company also has affiliates in Canada, the United Kingdom, and Burma. Sun-Times Media's balance sheet at September 30, 2008, showed total assets of $479.9 million, total liabilities of $801.7 million, resulting in a stockholders' deficit of roughly $321.8 million. The Company and its affiliates filed for Chapter 11 bankruptcy protection on March 31, 2009 (Bankr. D. Del. Case No. 09-11092). James H.M. Sprayregan, P.C., James A. Stempel, Esq., David A. Agay, Esq., and Sarah H. Seewer, Esq., at Kirkland & Ellis LLP, assist the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. As of November 7, 2008, the Debtors listed $479,000,000 in assets and $801,000,000 in debts. SUN-TIMES MEDIA: Ritchie Capital Gives Way for Union/Tyree Deal --------------------------------------------------------------- Chicago Newspaper Guild and the Tyree-buying group have come up with an agreed upon plan to allow the Sun-Times publications to continue their journalistic mission to the Illinois area, Thane Ritchie, founder of Ritchie Capital Management of suburban Lisle, Illinois, said in a statement. Five unions that previously rejected concessions demanded by buyer Jim Tyree tentatively agreed to contract changes in negotiations with the Company. According to The Associated Press, the rank and file of four of the unions voted to accept the contract changes agreed to by the Chicago Newspaper Guild and top company brass. Citing union sources, The AP relates that a separate union representing editorial workers at the Post-Tribune of Northwest Indiana would likely hold its vote on Friday. Private equity manager Thane Ritchie on Wednesday met with the Chicago Newspaper Guild in an eleventh-hour effort to cobble together a competing bid for the bankrupt Sun-Times Media Group newspaper chain that Ritchie claims would be more union-friendly. "We wanted to be helpful to the unions in this process -- ultimately it is the union members that make up the heart and soul of this paper," said Thane Ritchie, after receiving word that the Guild had been able to reach a deal that it could recommend to its members tonight. Steve Denari of Third Millennium Group strategic consultants, Ritchie's point man looking at the distressed newspaper properties nationwide added, "Everybody is a winner on this one, and we were pleased to have an unexpected chance to speak directly with the International Guild Representative about RCM's outline for a new 'coalition model' of private equity and unions." Consulting labor counsel for Ritchie, Collins Whitfield, who set up the meeting today with Guild leadership, noted that his firm, Whitfield, McGann & Ketterman, has been asked to continue in this role as RCM reviews distressed newspaper opportunities nationwide. Ritchie stated that Denari and Whitfield would travel to Washington, looking to present the new "coalition" transaction options to the full leadership of the International Guild, though no date for this has yet been set. "We've been asked whether we have the next newspaper candidate in sight," Thane Ritchie went on, "and I will just note that our other hometown paper, the Chicago Tribune, is also in bankruptcy - - although it isn't a union paper." To which Denari quipped, ". . . yet." Tyree's Offer Sun-Times Media won approval from the Bankruptcy Court to conduct an auction where a group led by James C. Tyree will be the lead bidder with an offer valued at $26.5 million. Sun-Times Media will sell its business to James C. Tyree-led STMG Holdings LLC, absent higher and better bids at an auction on October 7. The Debtors will seek the Court's approval of the results of the auction on Oct. 8. Sun-Times moved for the cancellation of the auction, saying that no qualified bids in addition to Tyree's was received by the bid deadline. STMG, which is under contract to buy Sun-Times absent higher and better bids, however, conditioned its bid to approval of amendments to the collective bargaining agreements by each of the company's unions. The unions, however, has opposed the CBA changes, which requires paycuts and other concessions. STMG said that to protect the future of the Sun-Times Media Group business, however, it is crucial for us to achieve the union amendments promptly for a closing as quickly as possible after the October 8 sale hearing. About Sun-Times Media Sun-Times Media Group, Inc. -- http://www.thesuntimesgroup.com/-- (Pink Sheets: SUTM) owns media properties including the Chicago Sun-Times and Suntimes.com as well as newspapers and Web sites serving more than 200 communities across Chicago. The Company and its affiliates conduct business as a single operating segment which is concentrated in the publishing, printing, and distribution of newspapers in greater Chicago, Illinois, metropolitan area and the operation of various related Web sites. The Company also has affiliates in Canada, the United Kingdom, and Burma. Sun-Times Media's balance sheet at September 30, 2008, showed total assets of $479.9 million, total liabilities of $801.7 million, resulting in a stockholders' deficit of roughly $321.8 million. The Company and its affiliates filed for Chapter 11 bankruptcy protection on March 31, 2009 (Bankr. D. Del. Case No. 09-11092). James H.M. Sprayregan, P.C., James A. Stempel, Esq., David A. Agay, Esq., and Sarah H. Seewer, Esq., at Kirkland & Ellis LLP, assist the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. As of November 7, 2008, the Debtors listed $479,000,000 in assets and $801,000,000 in debts. TANA SEYBERT: Proposes to Sell Certain Assets to Unimac Tana ------------------------------------------------------------ Tana Seybert LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York for authority to sell certain designated assets, free and clear of claims, liens and other encumbrances, subject to higher or better offers. The sale will be pursuant to Section 363(b) of the Bankruptcy Code and Rule 6004 of the Federal Rules of Bankruptcy Procedure. Unimac Tana Seybert LLC agreed to purchase the Debtors' assets for $679,510, cash, plus 70% of cost of usable paper stock on hand. The Debtors will sell, convey, assign and transfer to purchaser all of the assets, consisting of (a) the Tradenames, the Customer Lists, the MIS Software, the Graphics Files, the Hardware and the Approved Vendor Terms, (b) the New York Assets, (c) the New Jersey Assets, (d) the Mailing Equipment, and (e) Paper Assets. The Debtors relate that the purchaser also intends to hire 42 of the Debtors' salesforce, 16 of their administrative staff and 25 of their manufacturing personnel. In addition, Purchaser has offered employment or consulting arrangements to five of the Debtors' insiders: Eric Bernstein, James Nicholas, David Jurist, Alice Jurist and Gerry Ritterman. To fund the Debtors' operations pending the asset sale, the Debtors are also seeking approval of the terms of a consensual cash collateral facility with HSBC Bank USA, N.A., its prepetition lender, which asserts a claim of $9.5 million, secured by liens in substantially all of the Debtors' assets. The Debtors relate that all alternative bids must be submitted to the Debtors' counsel, Halperin Battaglia Raicht, LLP, 555 Madison Avenue, 9th Floor, New York, New York 10022, Attn: Robert D. Raicht, Esq. and Julie D. Dyas, Esq., by a date fixed by the Bankruptcy Court. The Debtors propose that the Court schedule the auction and sale hearing during the week of Oct. 19, 2009. Committee Objects The Official Committee of Unsecured Creditors in Tana Seybert and its debtor-affiliates' Chapter 11 cases objects to the Debtors' sale motion, relating that: -- the bidding procedures are not acceptable; -- the bidding procedures only benefit hsbc and the insiders; and -- the proposed bid procedures must be modified. Lowenstein Sandler PC, represented the Committee. About Unimac Tana Seybert LLC Based in Carlstadt, New Jersey, Unimac Tana Seybert LLC is a printing company that offers services for outdoor advertising, point of purchase displays, in-store signing, direct mail components, pharmaceutical and healthcare inserts, catalogs, and hang tags. About Tana Seybert New York City-based Tana Seybert LLC and its affiliates filed for Chapter 11 on Sept. 11, 2009 (Bankr. S.D.N.Y. Case No. 09- 15478). Alan D. Halperin, Esq., at Halperin Battaglia Raicht LLP represents the Debtors in their restructuring efforts. The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. In their petition, the Debtors listed assets and debts both ranging from $10,000,001 to $50,000,000. TERRI LYNN POLHERT: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Terri Lynn Polhert 2360 Golden Gate Ave Summerland, CA 93067 Bankruptcy Case No.: 09-23203 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Central District of California (San Fernando Valley) Judge: Maureen Tighe Debtor's Counsel: Louis J. Esbin, Esq. 27201 Tourney Rd., Suite 122 Valencia, CA 91355-1804 Tel: (661) 254-5050 Fax: (661) 254-5252 Email: Esbinlaw@sbcglobal.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of $1,435,250, and total debts of $3,019,688. 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/cacb09-23203.pdf The petition was signed by Terri Lynn Polhert. TETON ENERGY: Forbearance Pact Extended to October 16 ----------------------------------------------------- Effective as of September 30, 2009, Teton Energy Corporation entered into a letter agreement with JPMorgan Chase Bank, N.A., as administrative agent, and certain lenders amending the Third Amendment to the Second Amended and Restated Credit Agreement and Forbearance Agreement which was entered into effective as of August 26, 2009. JPMorgan Chase and the lenders agree to forbear from exercising their rights and remedies as a result of the Company's failure to repay the Borrowing Base Deficiency of $8,484,296 on August 25, 2009, until 5:00 p.m., October 16, 2009 (Dallas, Texas time). The Company, from time to time, enters into commodity hedge agreements to mitigate a portion of the potential exposure to adverse market changes in the prices of oil and natural gas, with JPMorgan Chase. The Company is also reporting that the forbearance period related to the interest payment due on the Company's outstanding 10.75% Senior Secured Convertible Debentures has been extended through and including October 16, 2009. The Company intends to continue to work with the holders of the Debentures towards a more permanent solution, however, there can be no assurance that the Company will be successful in doing so, in which case the Company may, among other options, be required to seek protection under the United States Bankruptcy Code. About Teton Energy Teton Energy Corporation -- http://www.teton-energy.com/-- is an independent oil and gas exploration and production company focused on the acquisition, exploration and development of North American properties. The Company's current operations are concentrated in the prolific Rocky Mountain and Mid-continent regions of the U.S. Teton has leasehold interests in the Central Kansas Uplift, eastern Denver-Julesburg Basin in Colorado and the Big Horn Basin in Wyoming. Teton is headquartered in Denver, Colorado. The Company's balance sheet at June 30, 2009, showed total assets of $60.00 million, total liabilities of $50.90 million and stockholders' equity of about $9.10 million. THERMOENERGY CORP: Kemp & Company Raises Going Concern Doubt ------------------------------------------------------------ Kemp & Company, a Professional Association, in Little Rock, Arkansas, expressed substantial doubt about ThermoEnergy Corporation's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended December 31, 2008. The auditing firm reported that the Company has incurred net losses since inception and will require substantial capital to continue commercialization of the Company's technologies and to fund the Company's liabilities, which included $2,022,000 of unpaid payroll taxes, $3,478,000 of convertible debt in default (net of debt discounts of $313,000) and $3,334,000 of contingent liability reserves at December 31, 2008. ThermoEnergy Corporation reported a net loss of $15,736,000 on contract and grant income of $1,730,000 for the year ended December 31, 2008, compared with a net loss of $17,677,000 on contract and grant income of $622,000 in 2007. Contract and grant income increased by $1,108,000 during 2008 compared to 2007 due primarily to an increase of $981,000 in contract income at the CASTion subsidiary. CASTion was acquired by the Company on July 2, 2007, and, therefore, only six months of its revenue were included in the year ended December 31, 2007. Grant income increased by $127,000 during 2008 compared to 2007. At December 31, 2008, the Company's consolidated balance sheet showed $1,035,000 in total assets and $10,457,000 in total liabilities, resulting in a $9,422,000 stockholders' deficit. The Company's consolidated balance sheet at December 31, 2008, also showed strained liquidity with $554,000 in total current assets available to pay $10,866,000 in total current liabilities. Full-text copies of the Company's consolidated financial statements for the year ended December 31, 2008, are available for free at http://researcharchives.com/t/s?4692 Based in Little Rock, Arkansas, ThermoEnergy Corporation -- http://www.thermoenergy.com/-- is a diversified technologies company engaged in the worldwide commercialization of patented and/or proprietary municipal and industrial wastewater treatment and power generation technologies. The Company was founded in 1988 and underwent a name change in December 1996. The wastewater treatment technologies are consolidated in the Company's majority owned subsidiary, CASTion Corporation, a Massachusetts corporation. CASTion is a developer and manufacturer of innovative wastewater treatment and recovery systems to industrial and municipal clients. The Company is also the majority owner of a patented clean energy technology known as the ThermoEnergy Integrated Power System ("TIPS"), which converts fossil fuels (including coal, oil and natural gas) and biomass into electricity without producing air emissions, and at the same time removes and captures carbon dioxide in liquid form for sequestration or beneficial reuse. The TIPS technology is consolidated in the Company's majority owned subsidiary, ThermoEnergy Power Systems, LLC ("TEPS"). On February 23, 2009, TEPS entered into a fifty-fifty (50/50) joint venture with Babcock Power, Inc. called Babcock-Thermo Carbon Capture, LLC ("BTCC") to commercialize the TIPS process. BTCC received an exclusive worldwide license to the TIPS technology and BTCC is currently in the process of designing a zero-air emission/carbon capture 600 Mw TIPS fossil fuel power plant. THERMOENERGY CORP: Auditor Raised Going Concern in 2008 Results --------------------------------------------------------------- Kemp & Company, a Professional Association, in Little Rock, Arkansas, expressed substantial doubt about ThermoEnergy Corporation's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended December 31, 2008. The auditing firm reported that the Company has incurred net losses since inception and will require substantial capital to continue commercialization of the Company's technologies and to fund the Company's liabilities, which included $2,022,000 of unpaid payroll taxes, $3,478,000 of convertible debt in default (net of debt discounts of $313,000) and $3,334,000 of contingent liability reserves at December 31, 2008. ThermoEnergy Corporation reported a net loss of $15,736,000 on contract and grant income of $1,730,000 for the year ended December 31, 2008, compared with a net loss of $17,677,000 on contract and grant income of $622,000 in 2007. Contract and grant income increased by $1,108,000 during 2008 compared to 2007 due primarily to an increase of $981,000 in contract income at the CASTion subsidiary. CASTion was acquired by the Company on July 2, 2007, and, therefore, only six months of its revenue were included in the year ended December 31, 2007. Grant income increased by $127,000 during 2008 compared to 2007. At December 31, 2008, the Company's consolidated balance sheet showed $1,035,000 in total assets and $10,457,000 in total liabilities, resulting in a $9,422,000 stockholders' deficit. The Company's consolidated balance sheet at December 31, 2008, also showed strained liquidity with $554,000 in total current assets available to pay $10,866,000 in total current liabilities. Full-text copies of the Company's consolidated financial statements for the year ended December 31, 2008, are available for free at http://researcharchives.com/t/s?4692 Based in Little Rock, Arkansas, ThermoEnergy Corporation -- http://www.thermoenergy.com/-- is a diversified technologies company engaged in the worldwide commercialization of patented and/or proprietary municipal and industrial wastewater treatment and power generation technologies. The Company was founded in 1988 and underwent a name change in December 1996. The wastewater treatment technologies are consolidated in the Company's majority owned subsidiary, CASTion Corporation, a Massachusetts corporation. CASTion is a developer and manufacturer of innovative wastewater treatment and recovery systems to industrial and municipal clients. The Company is also the majority owner of a patented clean energy technology known as the ThermoEnergy Integrated Power System ("TIPS"), which converts fossil fuels (including coal, oil and natural gas) and biomass into electricity without producing air emissions, and at the same time removes and captures carbon dioxide in liquid form for sequestration or beneficial reuse. The TIPS technology is consolidated in the Company's majority owned subsidiary, ThermoEnergy Power Systems, LLC ("TEPS"). On February 23, 2009, TEPS entered into a fifty-fifty (50/50) joint venture with Babcock Power, Inc. called Babcock-Thermo Carbon Capture, LLC ("BTCC") to commercialize the TIPS process. BTCC received an exclusive worldwide license to the TIPS technology and BTCC is currently in the process of designing a zero-air emission/carbon capture 600 Mw TIPS fossil fuel power plant. THORNBURG MORTGAGE: Seeks to Recover Funds From 2 Former Officials ------------------------------------------------------------------ Tom Hals at Reuters reports that Thornburg Mortgage, Inc., now known as TMST Inc., has filed a complaint in federal court to recover funds from the Company's former CEO Larry Goldstone and former chief financial officer Clarence Simmons, who allegedly used company offices, assets, and payroll to launch start-up company SAF Financial Inc. Reuters relates that after Thornburg Mortgage's bankruptcy, Messrs. started founding SAF Financial. Court documents say that former executives paid themselves and others unauthorized bonuses, contracted with vendors and booked trips using money from Thornburg Mortgage. According to Reuters, Messrs. Goldstone and Simmons got a total of $232,000 in bonuses. Reuters states that the two paid $93,000 in bonuses to other managers of Thornburg Mortgage who were involved in the SAF project. Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA) -- http://www.thornburgmortgage.com/-- is a single-family residential mortgage lender focused principally on prime and super-prime borrowers seeking jumbo and super-jumbo adjustable rate mortgages. It originates, acquires, and retains investments in adjustable and variable rate mortgage assets. Its ARM assets comprise of purchased ARM assets and ARM loans, including traditional ARM assets and hybrid ARM assets. Thornburg Mortgage, Inc., and its four affiliates filed for Chapter 11 on May 1 (Bankr. D. Md. Lead Case No. 09-17787). Judge Duncan W. Keir is handling the case. David E. Rice, Esq., at Venable LLP, in Baltimore, Maryland, has been tapped as counsel. Orrick, Herrington & Sutcliffe LLP is employed as special counsel. Jim Murray, and David Hilty, at Houlihan Lokey Howard & Zukin Capital, Inc., have been tapped as investment banker and financial advisor. Protiviti Inc. has also been engaged for financial advisory services. KPMG LLP is the tax consultant. Epiq Systems, Inc., is claims and noticing agent. In its bankruptcy petition, Thornburg listed total assets of $24,400,000,000 and total debts of $24,700,000,000, as of January 31, 2009. TRUE TEMPER: Files Prepackaged Chapter 11 Plan ---------------------------------------------- True Temper Sports Inc. filed a prepackaged Chapter 11 plan before the U.S. Bankruptcy Court for the District of Delaware. True Temper will seek confirmation of the Plan, which is already accepted by creditors, at a confirmation hearing 45 days from now. True Temper announced on Sept. 30 that secured lenders, bondholders and shareholders agreed on the prepackaged plan that would reduce funded debt by 80%, from $275 million to less than $40 million. The plan support agreement requires True Temper to emerge from bankruptcy by December 15. Debt holders and stockholders are injecting $70 million cash that will be used pay down first-lien debt totaling $105.6 million. The remainder of the first-lien debt will be converted into a new term loan under the plan. The $45 million in second-lien debt is to have 11.4% of the new stock. Most of the remainder goes to the investors. While trade suppliers are to be paid in full, other unsecured creditors are to receive nothing. The holders of $125 million in subordinated debt are to receive nothing on account of the debt. The investors providing $70 million financing for the plan hold 45.5% of the subordinated debt. The Debtors have approximately $275 million of indebtedness under the first lien credit facility, second lien credit facility, and the senior subordinated notes. According to Jason A. Jenne, vice president and CFO of True Temper, a series of recent and unforeseen events severely impacted the Debtors' ability to continue servicing their substantial indebtedness and ultimately led to the Debtors' decision to seek to restructure through a prepackaged chapter 11 plan of reorganization. Those events include: (a) the deep recession in the United States (and international) economy, (b) the resulting deterioration in the Debtors' financial performance in 2009, and (c) the Debtors' defaults under the first lien credit facility, second lien credit facility, and the senior subordinated notes A copy of the Plan is available for free at: http://bankrupt.com/misc/TrueTemper_PrepackPlan.pdf A copy of the disclosure statement explaining in detail the terms of the Plan is available for free at: http://bankrupt.com/misc/TrueTemper_PrepackDS.pdf About True Temper True Temper is the leading manufacturer of golf shafts in the world, and is consistently the number one shaft on all professional tours globally. The Company markets a complete line of shafts under the True Temper(R), Grafalloy(R) and Project X(R) shaft brands, and sells these brands in more than 30 countries throughout the world. True Temper is proudly represented by more than 800 individuals in ten facilities located in the United States, Europe, Japan, China and Australia. As of June 28, 2009, the Company had $180.4 million in total assets and $319.0 million in total liabilities, resulting in stockholders' deficit of $138.5 million. True Temper filed for Chapter 11 on Oct. 8, 2009 (Bankr. D. Del Case No. 09-13446). Marion M. Quirk, Esq., at Cole, Schotz, Meisel, Forman & Leonard, represents the Debtor in its restructuring effort. Logan & Company serves as claims and notice agent. Bankruptcy Judge Peter J. Walsh handles the case. TRUMP ENTERTAINMENT: Competing Plans to Be Sent to Creditors ------------------------------------------------------------ Creditors of Trump Entertainment Resorts Inc. will be choosing between two competing plans. According to Bloomberg News, Judge Judith Wizmur gave the Donald Trump-backed Debtors and their noteholders permission to solicit acceptances for their competing plans, after their plan outlines were approved. The two parties have upped their restructuring proposals for Trump Entertainment, with Donald Trump and a bank offering to pitch in an additional $13.9 million for creditors and the noteholders offering $50 million more in fresh capital. Donald Trump and Beal Bank would invest $100 million, with Beal raising the interest rate while extending the maturity of a $486 million loan from 2012 to December 2020. As reported by the TCR on August 6, 2009, Trump Entertainment Resorts Inc. filed a Chapter 11 plan built around the proposed sale of the company to shareholder Donald Trump. Under the original plan, Donald J. Trump and BNAC, Inc., an affiliate of Beal Bank Nevada, will invest $100 million cash in the newly private company and become its owners. The original plan provides for a 94% recovery for Beal Bank, the secured creditor, and a wipe out for lower ranked creditors. The Ad Hoc Committee of Holders of the 8.5% Senior Secured Notes Due 2015 filed a competing plan, which originally offered a capital contribution of $175 million in new equity capital in the form of a rights offering backstopped by certain holders of the Senior Secured Notes. That plan would allow second lien noteholders and general unsecured claimants to receive their pro rata share of (a) 5% of the common stock of the reorganized Debtors, and (b) subscription rights to acquire 95% of the New Common Stock. The second lien noteholders are offering $225 million through a rights offering while selling one of the three casinos for $75 million to Coastal Marina LLC, a company controlled by Richard T. Fields. The second lien noteholders' plan would pay the first- lien debt in full by giving them new debt plus proceeds from the Marina sale and cash from the rights offering. The second lien noteholders and allowed general unsecured creditors would receive 95% of the new stock. The participants in the $225 million rights offering will receive 75% of the new stock while the noteholders who will backstop the offering will receive 25% of the new stock as backstop fee. 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. Garden City Group is the claims agent. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of December 31, 2008. Trump Hotels & Casino Resorts, Inc., filed for Chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No. 04-46898 through 04-46925). Trump Hotels' obtained the Court's confirmation of its Chapter 11 plan on April 5, 2005, and in May 2005, it exited from bankruptcy under the name Trump Entertainment Resorts Inc. U.S. DEVELOPMENT LAND: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: U.S. Development Land, LLC 15990 Greenway Hayden Loop, #600 Scottsdale, AZ 85260 Case No.: 09-25015 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Eileen W. Hollowell Debtor's Counsel: John J. Hebert, Esq. Polsinelli Shughart, P.C. 3636 N. Central Avenue, Suite 1200 Phoenix, AZ 85012 Tel: (602) 650-2011 Fax: (602) 391-2546 Email: jhebert@polsinelli.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $50,000,001 to $100,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. UAL CORP: Inks Common Stock Underwriting Deal with JPMorgan, et al ------------------------------------------------------------------ UAL Corporation on October 1, 2009, entered into the Common Stock Underwriting Agreement with J.P. Morgan Securities Inc., Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co., on behalf of the underwriters, relating to the sale by the Company of 19,000,000 shares of its common stock, par value $0.01 per share, at a price to the public of $7.24 per share of Common Stock. Delivery of the Shares was made under the Common Stock Underwriting Agreement on October 7, 2009. The Shares were sold pursuant to the Equity Prospectus Supplement, dated October 1, 2009, to the Prospectus, dated December 1, 2008, which forms a part of an automatic shelf registration statement on Form S-3 (Registration No. 333-155794) of the Company filed with the Securities and Exchange Commission on December 1, 2008. On October 1, 2009, the Company also entered into the Notes Underwriting Agreement with the Underwriters, relating to the sale by the Company of $345,000,000 aggregate principal amount of 6.0% convertible senior notes due 2029, convertible into shares of Common Stock, including $45,000,000 aggregate principal amount of the Notes issued pursuant to the Underwriters' exercise of the over-allotment option. Delivery of the Notes was made under the Notes Underwriting Agreement on October 7, 2009. The Notes were sold pursuant to the Notes Prospectus Supplement, dated October 1, 2009, to the Prospectus which forms a part of the Registration Statement. The Notes were issued under an indenture, dated as of October 7, 2009, between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. The Notes will mature on October 15, 2029. The interest on the outstanding principal amount of the Notes is payable semi-annually on April 15 and October 15 of each year, beginning April 15, 2010. The Company may redeem for cash all or part of the Notes on or after October 15, 2014, and the Notes are subject to mandatory redemption in certain circumstances. In addition, holders of the Notes have the right to require the Company to purchase all or a portion of their Notes on each of October 15, 2014, October 15, 2019 and October 15, 2024. The Notes are senior unsecured obligations of the Company and will rank senior in right of payment to the Company's existing and future indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment to the Company's existing and future unsecured indebtedness that is not so subordinated; junior in right of payment to any of the Company's secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness incurred by the Company's subsidiaries. The Underwriters or their affiliates have from time to time provided or may in the future provide investment banking, commercial banking and financial advisory services to the Company, for which they have received or will receive customary compensation. Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The Company filed for Chapter 11 protection on December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan on January 20, 2006. The company emerged from bankruptcy protection on February 1, 2006. (United Airlines Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported by the Troubled Company Reporter on October 6, 2009, Fitch Ratings has assigned a rating of 'C/RR6' to UAL Corp.'s $300 million senior convertible note issue. The notes, which are guaranteed by UAL's principal operating subsidiary, United Airlines, Inc., mature in 2029 and carry a coupon of 6%. Holders have the right to put the notes back to the company at par on Oct. 15, 2014 (as well as the same date in 2019 and 2024). Holders also have the right to require repurchase of the notes at par if the company undergoes a fundamental change, defined to include a change in majority ownership of the company but excluding certain restructuring events. The Issuer Default Rating for both UAL and United is 'CCC'. The TCR said October 5, 2009, that Standard & Poor's Ratings Services assigned its 'CCC' issue-level rating and '6' recovery rating to UAL Corp.'s $175 million convertible senior notes due 2029, which the company issued as a shelf drawdown. The '6' recovery rating reflects negligible recovery (0-10%) in a credit default scenario. In addition, S&P placed the issue-level rating on CreditWatch with negative implications, and will review it in conjunction with S&P's resolution of the CreditWatch listing on UAL. S&P placed its ratings on UAL and subsidiary United Air Lines Inc. on CreditWatch with negative implications on July 22, 2009, due to liquidity concerns. The company will use the proceeds from the debt issuance, along with proceeds from the concurrent issuance of 19 million shares, for general corporate purposes. In addition, S&P lowered its preliminary rating on UAL's senior unsecured shelf to 'CCC' from 'CCC+', based on S&P's analysis of recovery prospects for senior unsecured obligations. This rating is also on CreditWatch with negative implications. UAL CORP: Says EETC Offering to Generate $90MM in New Liquidity --------------------------------------------------------------- United Airlines, a wholly owned subsidiary of UAL Corporation, has priced its public offering of enhanced equipment trust certificates, to refinance an existing EETC facility that covers a number of the airline's aircraft. The $659 million financing has an interest rate of 10.40% and a final expected distribution date of November 1, 2016. United intends to use the net proceeds to repay at par all of the $568 million aggregate principal amount related to its outstanding 2001-1 EETC, and will use the approximately $90 million of remaining net proceeds, after accounting for all transaction- related fees and expenses, for general corporate purposes. As a result of this transaction, principal payment obligations will be reduced in 2010 by approximately $215 million and in 2011 by approximately $100 million. J.P. Morgan Securities Inc. and Morgan Stanley & Co. Incorporated are acting as joint book-running managers, with Goldman, Sachs & Co. acting as a co-manager, for the offering. The offering was made under the Company's effective shelf registration statement on Form S-3 previously filed with the Securities and Exchange Commission. A copy of the Company's free writing prospectus is available at no charge at http://ResearchArchives.com/t/s?4693 A copy of the Company's preliminary prospectus supplement is available at no charge at http://ResearchArchives.com/t/s?4694 Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) -- http://www.united.com/-- is the holding company for United Airlines, Inc. United Airlines is the world's second largest air carrier. The airline flies to Brazil, Korea and Germany. The Company filed for Chapter 11 protection on December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in their restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath & Rosenthal LLP represented the Official Committee of Unsecured Creditors before the Committee was dissolved when the Debtors emerged from bankruptcy. Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan on January 20, 2006. The company emerged from bankruptcy protection on February 1, 2006. (United Airlines Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported by the Troubled Company Reporter on October 6, 2009, Fitch Ratings has assigned a rating of 'C/RR6' to UAL Corp.'s $300 million senior convertible note issue. The notes, which are guaranteed by UAL's principal operating subsidiary, United Airlines, Inc., mature in 2029 and carry a coupon of 6%. Holders have the right to put the notes back to the company at par on Oct. 15, 2014 (as well as the same date in 2019 and 2024). Holders also have the right to require repurchase of the notes at par if the company undergoes a fundamental change, defined to include a change in majority ownership of the company but excluding certain restructuring events. The Issuer Default Rating for both UAL and United is 'CCC'. The TCR said October 5, 2009, that Standard & Poor's Ratings Services assigned its 'CCC' issue-level rating and '6' recovery rating to UAL Corp.'s $175 million convertible senior notes due 2029, which the company issued as a shelf drawdown. The '6' recovery rating reflects negligible recovery (0-10%) in a credit default scenario. In addition, S&P placed the issue-level rating on CreditWatch with negative implications, and will review it in conjunction with S&P's resolution of the CreditWatch listing on UAL. S&P placed its ratings on UAL and subsidiary United Air Lines Inc. on CreditWatch with negative implications on July 22, 2009, due to liquidity concerns. The company will use the proceeds from the debt issuance, along with proceeds from the concurrent issuance of 19 million shares, for general corporate purposes. In addition, S&P lowered its preliminary rating on UAL's senior unsecured shelf to 'CCC' from 'CCC+', based on S&P's analysis of recovery prospects for senior unsecured obligations. This rating is also on CreditWatch with negative implications. UTGR INC: Seeks February 28 Extension for Plan Filing ----------------------------------------------------- UTGR Inc. is asking the Bankruptcy Court to extend its exclusive period to file a Chapter 11 plan until February 28, 2009, Bill Rochelle at Bloomberg News reported. UTGR, in its extension request, tells the Court that it has reached a preliminary agreement to end a dispute over termination of a contract with an association of greyhound owners. UTGR filed for bankruptcy protection in June 2009, citing among other issues a contract with the Rhode Island Greyhound Owners Association that the Company claimed cost too much money. UTGR prior to its bankruptcy filing reached an agreement on a restructuring for its racetrack casino with holders of half the first-lien debt and a "substantial amount" of the second-lien obligation. The restructuring is dependent on assistance from the state and action by the Rhode Island legislature. The proposed plan would reduce debt by $290 million, and would require $11 million in support for promotion and marketing from the state, among other things. About UTGR Inc. UTGR Inc. is the operator of the Twin River racetrack-casino in Lincoln, Rhode Island. UTGR filed for Chapter 11 on June 23 (Bankr. D. Rhode Island Case No. 09-12418). The Debtors selected Jager Smith P.C. as counsel, and Winograd, Shine & Zacks P.C. as their co-counsel. It also hired Zolfo Cooper LLC as bankruptcy consultants and special financial advisors. Donlin Recano has been tapped as claims and notice agent. In its bankruptcy petition, the Company estimated assets of less than $500 million and debt exceeding $500 million. UVRP LLC: Files to Reorganize in Reno ------------------------------------- UVRP LLC filed a Chapter 11 petition in Reno, Nevada. UVRP LLC is the developer of the University Village master planned community in Reno. The petition listed assets of $9.4 million against debt totaling $17.5 million. Secured lenders are owed $6.5 million. The firm filed for Chapter 11 on Sept. 30 (Bankr. D. Nev. Case No. 09-53451). William D. Cope, Esq., represents the Debtor in its restructuring effort. VALCOM INC: Posts Revised Net Loss of $1.3MM 3rd Quarter -------------------------------------------------------- On October 5, 2009, ValCom, Inc., filed an amended quarterly report for the three months ended June 30, 2009. As explained by the Company, on August 21, 2009, the Company filed its Form 10-Q for the period ended June 30, 2009, without the review of its auditors, Seale and Beers, CPAs. The Company is filing this 10-Q/A upon the completion of the review of Seale and Beers, CPAs. As amended, ValCom, Inc., posted a net loss of $1,268,348 on revenues of $262,692 for the third quarter ended June 30, 2009, compared with a net loss of $141,208 on revenues of $190,961 in the same period in 2008. The increase in revenue was principally due to revenues generated by MyFamilyTV. For the nine months ended June 30, 2009, the Company posted a net loss of $1,506,655 on revenues of $647,896, compared with a net loss of $501,161 on revenues of $839,918 in the same period in 2008. The Company attributed the decrease in revenue principally to the drop in television production and advertising revenues. Results for both the three and nine month periods ended June 30, 2009, include a $900,262 asset impairment charge related to the Company's acquisition of FaithTV. While the Company anticipates future revenues and profits from the acquisition, as of June 30, 2009, the operations and results have not been adequate to support the book value of the assets acquired, as estimated by the Company's management at the time of purchase. Estimates of future sales could not be determined, and no formal appraisals of the acquired assets were obtained. Based on the above factors, the Company concluded that the net book valuation of the film library, the equipment and intangible assets totaling $900,262 could not be fully supported and therefore as of June 30, 2009, the Company deemed the assets impaired and wrote them off. At June 30, 2009, the Company's consolidated balance sheet showed $1,495,322 in total assets and $1,884,700 in total liabilities, resulting in a $389,378 stockholders' deficit. The Company's consolidated balance sheet at June 30, 2009, also showed strained liquidity with $435,899 in total current assets available to pay $1,884,700 in total current liabilities. Going Concern Doubt As reported in the Troubled Company Reporter on Jan. 21, 2009, Moore & Associates Chartered, in Las Vegas, Nevada, expressed substantial doubt about the Company's ability to continue as a going concern after auditing the consolidated balance sheets of Valcom, Inc., as of Sept. 30, 2008, and 2007, and the related consolidated statements of operations, stockholders' equity and cash flows for the years then ended. The auditing firm pointed to Company's significant annual losses, which have resulted in an accumulated deficit of $17,733,106 at Sept. 30, 2008. About Valcom ValCom, Inc., had five subsidiaries: (1) Valencia Entertainment International, LLC; (2) Half Day Video, Inc.; (3) ValCom Studios, Inc. (80% Equity Interest); (4) New Zoo Revue LLC (50% Interest); (5) ValCom Broadcasting, LLC (45% Equity Interest). The company is a diversified entertainment company with four divisions: studio rental, film production division, live theatre division, TV stations and broadcasting. The Company filed a voluntary petition for reorganization under Chapter 11 on July 16, 2007 (Bankr. C.D. Calif. Case No. 07-15984). Joseph L. Pittera, Esq., represented the Debtor in its restructuring efforts. The Hon. Ernest M. Robles of the United States Bankruptcy Court for the Central District of California confirmed a second amended Chapter 11 plan of liquidation filed by Valcom Inc. on June 14, 2008. The company emerged from bankruptcy on August 5, 2008. VELOCITY EXPRESS: U.S. Trustee Forms Three-Member Committee ----------------------------------------------------------- Roberta A. DeAngelis, the United States Trustee for Region 3, appointed three creditors to serve on the Official Committee of Unsecured Creditors for Velocity Express Corporation and its debtor-affiliates. The members of the committee: a) City Express Courier Service Attn: Michael Davidson 6931 Arlington Road #T200 Bethesda, MD 20814 Tel: (240) 333-7333 Fax: (240) 333-7334 b) Morton West LLC Attn: Althie Toro 104 Fifth Avenue New York, NY 10007 Tel: (646) 237-5577 c) American Expediting Co. Attn: Victor Finnegan 2215 Arch Street Philadelphia, PA 19103 Tel: (215) 751-1199 Fax: (215) 751-0503 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 Attnempt 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 Velocity Express Velocity Express -- http://www.velocityexpress.com/-- has one of the largest nationwide networks of regional, time definite, ground delivery service areas, providing a national footprint for customers desiring same day service throughout the United States. The Company's services are supported by a customer-focused technology infrastructure, providing customers with the reliability and information they need to manage their transportation and logistics systems, including a proprietary package tracking system that enables customers to view the status of any package via a flexible web reporting system. Velocity, together with 12 affiliates, filed for Chapter 11 on Sept. 24, 2009 (Bankr. D. Del. Case No. 09-13294). The Company listed assets of $94.1 million and debt of $120.6 million as of Sept. 1. ComVest Velocity Acquisition I, LLC, buyer of the Debtors' assets, is represented in the case by Kenneth G. Alberstadt, Esq., at Akerman Senterfitt LLP in New York. DIP Lender Burdale is represented in the case by Jonathan M. Cooper, Esq., Randall L. Klein, Esq., and Sarah J. Risken, Esq., at Goldberg Kohn Bell Black Rosenbloom & Moritz, LTD., in Chicago, Illinois. VERASUN ENERGY: Gets Court Nod to Assign Pact to RBF Acquisition ---------------------------------------------------------------- VeraSun Energy Corp. and its affiliates obtained the Court's authority to assume a phosphorous trading agreement with the City of St. Peter, a municipal corporation of Nicollet County, Minnesota, and assign the agreement to RBF Acquisition V LLC. No objections were filed to the request to assume the contract. Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP, in Wilmington, Delaware, relates that after the sale of substantially all of the Debtors' assets, RBF Acquisition informed the Debtors that it desired to take assignment of the Contract because it is essential to RBF's ongoing everyday operations of the newly acquired ethanol site from the Debtors. Mr. Chehi notes that no cure amount is owing to the Contract and that by assuming and assigning the Contract, the Debtors will be relieved of the obligation to make further administrative payments associated with the Contract. VERASUN ENERGY: Gets Court Nod to Solicit Votes on Plan ------------------------------------------------------- Judge Brendan L. Shannon of the United States Bankruptcy Court for the District of Delaware found the disclosure statement explaining the Chapter 11 Plan of Liquidation filed by VeraSun Energy Corporation's and its debtor affiliates as containing adequate information as the term is defined in Section 1125 of the Bankruptcy Code. Accordingly, Judge Shannon approved on September 10, 2009, the Disclosure Statement. All objections to the Disclosure Statement were overruled by the Judge, however one party, Liberty Mutual Insurance Company, withdrew its objection after the Debtors notified Liberty of their compliance to Liberty's request to provide certain documents. Before the Disclosure Statement was approved, the Debtors filed a revised Disclosure Statement to address certain revisions asked by certain parties-in-interest. A blackline copy of the Revised Disclosure Statement is available for free at: http://bankrupt.com/misc/VerSRevDS.pdf Confirmation Schedule The last date and time by which ballots for accepting or rejecting the Debtors' Chapter 11 Plan of Liquidation must be received by the Voting Agent to be counted will be October 16, 2009, at 4:00 p.m. The last date and time for filing and serving motions pursuant to Fed. R. Bankr. P. 30 18(a) seeking temporary allowance of claims for voting purposes will be October 5, 2009 at 4:00 p.m. Judge Shannon sets October 23, 2009, at 10 a.m. as the Plan confirmation hearing. The date is to be continued, if necessary. October 16, 2009 is the deadline for filing confirmation objections and the Debtors will file their responses, no later than October 21, 2009. The Liquidating Plan VeraSun Energy Corporation, its debtor affiliates, and the Official Committee of Unsecured Creditors submitted to the U.S. Bankruptcy Court for the District of Delaware on July 31, 2009, a joint Chapter 11 plan of liquidation and an accompanying disclosure statement. The Plan provides for the distribution of substantially all of the assets of the Debtors to various creditors and to subsequently wind up the Debtors' corporate affairs. A full-text copy of the Chapter 11 Liquidation Plan is available for free at http://bankrupt.com/misc/VerSPlan.pdf A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/VerSDS.pdf About VeraSun Energy Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp. -- http://www.verasun.com/or http://www.VE85.com/-- produces and markets ethanol and distillers grains. Founded in 2001, the company has a fleet of 16 production facilities in eight states, with 14 in operation. The Company and its debtor-affiliates filed for Chapter 11 protection on October 31, 2008 (Bankr. D. Del. Case No. 08-12606). Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP represents the Debtors in their restructuring efforts. AlixPartners LLP serves as their restructuring advisor. Rothschild Inc. is their investment banker and Sitrick & Company is their communication agent. The Debtors' claims noticing and balloting agent is Kurtzman Carson Consultants LLC. The Debtors' total assets as of June 30, 2008, was $3,452,985,000 and their total debts as of June 30, 2008, was $1,913,214,000. VeraSun closed on April 1, 2009, the sale of substantially all of its assets to Valero Renewable Fuels, a subsidiary of Valero Energy Corporation, North America's largest petroleum refiner and marketer. The purchased assets included five ethanol production facilities and a development site. The facilities are located in Aurora, South Dakota; Fort Dodge, Charles City, and Hartley, Iowa; and Welcome, Minnesota, and the development site is in Reynolds, Indiana. Valero paid $350 million for the ethanol production facilities in Aurora, Fort Dodge, Charles City, Hartley and Welcome, in addition to the Reynolds site. Valero also successfully bid $72 million for the Albert City facility and $55 million for the Albion facility. The purchase price also includes working capital and other certain adjustments. VeraSun also completed on April 9 the sale to AgStar Financial Services PCA of substantially all of the assets relating to the company's production facilities in Dyersville, Iowa; Hankinson, North Dakota; Janesville, Minnesota; Central City and Ord, Nebraska; and Woodbury, Michigan. AgStar released the USBE Subsidiaries from their obligations under $319 million of existing indebtedness and assumed certain liabilities relating to the AgStar Facilities. On April 13, US BioEnergy Corporation and US Bio Marion LLC completed the sale to Marion Energy Investments LLC, as assignee of Dougherty and First Bank & Trust, of substantially all of the assets relating to the Debtors' production facility in Marion, South Dakota. The consideration for the acquired assets consisted of release of US Bio Marion from its obligations under approximately $93 million of existing indebtedness to the Marion Buyers, payment by MEI of $934,861 in cash and assumption by the Marion Purchasers of certain liabilities relating to the Marion facility. VeraSun Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). VERASUN ENERGY: Motion to Approve Sourcegas & Valero Settlement --------------------------------------------------------------- VeraSun Energy Corp. and its affiliates ask the Court for authority to enter into a settlement agreement with SourceGas Distribution LLC and Valero Renewable Fuels Company LLC pursuant to which the Debtors and Valero will each pay $13,500 in cure costs to SourceGas in consideration of SourceGas' agreement on a certain contract, which was assumed and assigned to Valero. As previously reported, the Debtors sold substantially all of their assets to Valero. After the transaction, SourceGas asserted that the Debtors owe it $32,832 under an agreement, which ASA Albion LLC, one of the Debtors, entered into with Kinder Morgan, Inc. The assets relating to the Agreement was subsequently sold by Kinder Morgan to SourceGas. Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP, in Wilmington, Delaware, relates that once the agreement is approved by the Court, both SourceGas and Valero will waive any claims against the Debtors relating to the Agreement. He adds that no party-in-interest would be harmed by the Settlement but rather, the Settlement will benefit the Debtors, their estates and their creditors because will avoid litigation and obviate the Debtors' need to expend the significant time and other resources on the matter. About VeraSun Energy Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp. -- http://www.verasun.com/or http://www.VE85.com/-- produces and markets ethanol and distillers grains. Founded in 2001, the company has a fleet of 16 production facilities in eight states, with 14 in operation. The Company and its debtor-affiliates filed for Chapter 11 protection on October 31, 2008 (Bankr. D. Del. Case No. 08-12606). Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP represents the Debtors in their restructuring efforts. AlixPartners LLP serves as their restructuring advisor. Rothschild Inc. is their investment banker and Sitrick & Company is their communication agent. The Debtors' claims noticing and balloting agent is Kurtzman Carson Consultants LLC. The Debtors' total assets as of June 30, 2008, was $3,452,985,000 and their total debts as of June 30, 2008, was $1,913,214,000. VeraSun closed on April 1, 2009, the sale of substantially all of its assets to Valero Renewable Fuels, a subsidiary of Valero Energy Corporation, North America's largest petroleum refiner and marketer. The purchased assets included five ethanol production facilities and a development site. The facilities are located in Aurora, South Dakota; Fort Dodge, Charles City, and Hartley, Iowa; and Welcome, Minnesota, and the development site is in Reynolds, Indiana. Valero paid $350 million for the ethanol production facilities in Aurora, Fort Dodge, Charles City, Hartley and Welcome, in addition to the Reynolds site. Valero also successfully bid $72 million for the Albert City facility and $55 million for the Albion facility. The purchase price also includes working capital and other certain adjustments. VeraSun also completed on April 9 the sale to AgStar Financial Services PCA of substantially all of the assets relating to the company's production facilities in Dyersville, Iowa; Hankinson, North Dakota; Janesville, Minnesota; Central City and Ord, Nebraska; and Woodbury, Michigan. AgStar released the USBE Subsidiaries from their obligations under $319 million of existing indebtedness and assumed certain liabilities relating to the AgStar Facilities. On April 13, US BioEnergy Corporation and US Bio Marion LLC completed the sale to Marion Energy Investments LLC, as assignee of Dougherty and First Bank & Trust, of substantially all of the assets relating to the Debtors' production facility in Marion, South Dakota. The consideration for the acquired assets consisted of release of US Bio Marion from its obligations under approximately $93 million of existing indebtedness to the Marion Buyers, payment by MEI of $934,861 in cash and assumption by the Marion Purchasers of certain liabilities relating to the Marion facility. VeraSun Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). VERTEBRON INC: Cardo Medical Acquires All Assets for $1.3 Million ----------------------------------------------------------------- Cardo Medical has acquired substantially all of the assets of Vertebron Inc. for $1.3 million in cash. Cardo Medical will retain 100% ownership of all Vertebron's implant technologies for spinal surgery. Cardo has also acquired all intellectual property rights owned by Vertebron which includes over 20 U.S. issued patents and patent applications. Through a previous licensing agreement, Cardo Medical currently markets and distributes the PSS Pedicle Screw and SCP Cervical Pate systems. Cardo Medical will expand its distribution domestically with this acquisition. Dr. Andrew Brooks, Chairman and Chief Executive Officer of Cardo Medical, stated, "We are pleased to have been able to extend our licensing agreement into full ownership rights of this innovative and solid portfolio of spinal technologies. This acquisition will provide a great springboard to our expanding product portfolio of innovative spinal technologies; and we look forward to a smooth incorporation of these significant assets in the coming quarters." Michael Kvitnitsky, President and Chief Operating Officer of Cardo Medical, stated, "As a company, Cardo Medical is now in unique position to build on multiple entries in many segments of the high growth spinal market. We are bringing the same kind of energy and expertise we devoted to the development of our homegrown products to extending our competitive advantage in innovation with the Vertebron clinically successful product portfolio." About Cardo Medical Cardo Medical (OTCBB:CDOM) develops reconstructive orthopedic and spinal surgery products through advanced engineering and focuses on product development, marketing and distribution within the U.S. market. Cardo Medical's superior engineering talent closely collaborates with leading surgeons around the country to create products that reduce or eliminate joint pain and allow patients to achieve more active lives. The Company's cutting edge products are specifically developed with patients, surgeons and OR staff in mind and are designed to reduce operative time, enhance surgical technique, shorten hospital stays, reduce recovery time and improve outcomes. Cardo Medical's product portfolio includes devices for knee, hip, spinal fusion and motion preservation arthroplasty and replacement, many of which have already received FDA clearance. Cardo Medical has a robust and innovative product pipeline pending both USPTO and FDA submission and clearance. About Vertebron Vertebron Inc. designs, develops, manufactures, and sells spinal implant products focused on fusion technology for the lumbar and cervical spine as well as motion preservation technologies. Vertebron reported it had generated approximately $11 million in sales for 2008. On April 21, 2009, Vertebron filed for Chapter 11 bankruptcy protection in the District of Connecticut. The acquisition is the result of a Chapter 11 auction process, approved by the United States Bankruptcy Court for the District of onnecticut. VIASYSTEMS INC: Merix Corp. Deal Won't Affect Moody's 'B3' Rating ----------------------------------------------------------------- Moody's Investors Service said that Viasystems' recently announced definitive agreement to combine with Merix Corporation in a stock- for-stock exchange will have no impact on the company's B3 corporate family rating and negative outlook. The last rating action was on June 30, 2009, when Moody's affirmed Viasystems' ratings and revised the outlook to negative. Headquartered in St. Louis, Missouri, Viasystems, Inc., is a provider of complex multi-layer printed circuit boards and electro-mechanical solutions utilized in a variety of applications across the automotive, telecommunications, industrial, instrumentation, medical, consumer, computing and data communications end markets. The company is a supplier to over 125 OEMs as well as several Tier 1 EMS providers. Revenues and EBITDA (Moody's adjusted) for the twelve months ended June 30, 2009, were $588 million and $66 million, respectively. Pro forma for the acquisition, combined LTM revenues were approximately $842 million. VIASYSTEMS GROUP: Merix Corp. Deal Won't Affect S&P's B+ Ratings ---------------------------------------------------------------- Standard & Poor's Ratings Services said that Viasystems Group Inc.'s announced planned cash-based acquisition of Merix Corp. would not immediately affect its 'B+' corporate credit rating and stable outlook on Viasystems Inc. (B+/Stable/--), the principal operating subsidiary of Viasystems Group. The acquisition requires consent of Merix's shareholders and customary regulatory approval, and is likely to close by the end of the year. Holders of 98% of Merix's outstanding $70 million debt have agreed to accept about 1.4 million newly issued Viasystems shares and $35 million in cash. The transaction does not affect Viasystems' outstanding debt. Viasystems provides complex multilayer, rigid printed circuit boards used in electronic equipment. The company's related businesses include systems integration, board assembly, testing, and fulfillment, with a significant manufacturing presence in China. Merix also provides multilayer, rigid printed circuit boards, although the two companies' customer bases do not significantly overlap. Merix has a significant North American presence for quick-turn prototype and pre-production services, and serves the communications, networking, computing, manufacturing, and defense industries. The acquisition will provide a broader operational framework than Viasystems had on a stand-alone basis. Still, the companies' revenues base and profitability are materially lower than they had been before the late-2008 industry downturn. Viasystems' debt leverage had deteriorated to the 5.0x area from the 2.5x area preceding the downturn. While S&P expects the merger to be accretive to Viasystems from an EBITDA perspective, industry conditions remain quite challenging. The post-merger company will initially have substantially smaller cash balances-about $40 million pro forma for closing of the transaction, supplemented by an undrawn $75 million line of credit. The line of credit will become available concurrent with the merger, while the company retains about $20 million availability in the recently completed $30 million China-based revolver. VYTERIS INC: Has Restructuring Deal with Spencer Trask ------------------------------------------------------ Vyteris, Inc., as part of its strategy to restructure its balance sheet, entered into a Restructuring Agreement on October 1, 2009, with Spencer Trask Specialty Group, LLC, and certain affiliated entities. The principal terms of the Restructuring Agreement are: 1. The principal amount of all indebtedness and accrued and unpaid interest thereon owed by the Company to STSG in excess of $2,000,000 -- Remaining Debt -- and all Series B Convertible, Mandatorily Redeemable Preferred Stock of Vyteris owned by STSG will be converted into common stock of the Company at the time of a equity related financing transaction entered into by the Company on or before December 31, 2009 in an amount of at least $1,000,000 -- Qualified Financing. The conversion price is 100% in excess of the price at which equity securities are sold in the Qualified Financing, or if the Qualified Financing involves the sale of debt or equity related securities, 100% in excess of the conversion price of such debt or equity related securities. The approximate amount of debt and accrued and unpaid interest that would be converted is $9,400,000, and the approximate conversion value of the Preferred Stock that would be converted is $10,500,000. 2. The Remaining Debt shall be evidenced by a promissory note with a term of three years from the date of initial closing of a Qualified Financing (or, if debt issued in connection therewith has a term shorter than three years, it would terminate simultaneously therewith) with interest accruing at the rate of 6% per year. The Note is secured by a lien on the Company's assets, subordinate to the lien of any existing creditors that have a lien senior to that of STSG and to any liens resulting from a Qualified Financing. The Remaining Debt is to be prepaid with 50% of the net proceeds from any Qualified Financing or other sale of equity or equity related securities by the Company in excess of $5,000,000 during the term of the Note. A full-text copy of the Restructuring Agreement between the Company and Spencer Trask Specialty Group, dated October 1, 2009, is available at no charge at http://ResearchArchives.com/t/s?4690 Vyteris, Inc., holds approximately 50 U.S. patents relating to the delivery of drugs across the skin using a mild electric current and operates in one business segment. The Company is pursuing peptide and small molecule opportunities through, among other things, drug development partnerships. As of June 30, 2009, the Company had $1,051,443 in total assets and $35,151,494 in total liabilities, resulting in $34,100,051 in stockholders' deficit. The Company said the report of the independent registered public accounting firm relating to the audit of the Company's consolidated financial statements for the year ended December 31, 2008, contains an explanatory paragraph expressing uncertainty regarding the Company's ability to continue as a going concern because of its operating losses and its continuing need for additional capital. The Company said failure to obtain financing will require management to substantially curtail, if not cease, operations, which will result in a material adverse effect on the financial position and results of operations of the Company. VYTERIS INC: Inks Settlement and Release with Landlord ------------------------------------------------------ Vyteris, Inc., on September 30, 2009, entered into a Settlement and Release Agreement with 17-01 Pollitt Drive, L.L.C., with respect to its former leasehold at 17-01 Pollitt Drive, in Fair Lawn, New Jersey, which is the additional leased space which the Company previously vacated. The Settlement Agreement calls for: 1. The Company to pay Landlord $500,000, which is evidenced by the issuance of a five-year interest only balloon note with interest accruing at the rate of 6% per year. If the Company receives its Phase III milestone payment from Ferring Pharmaceuticals, Inc., repayment is accelerated to no later than 30 business days from the date of receipt of the milestone payment. Upon a default by the Company under this promissory note, the principal amount is increased to $600,000. The note is convertible at the Landlord's sole discretion into unregistered common stock of the Company at the conversion price of $1.50 per share. 2. The Landlord to release the Company from its obligations under the lease between Landlord and the Company, dated December 14, 2004, covering 17-01 Pollitt Drive, Fair Lawn, New Jersey. Due to the lease, the Company previously had approximately $2,455,000 of accrued restructuring liability and accounts payable on its consolidated balance sheet as of September 30, 2009, and the termination of the lease is a significant next step in its restructuring project. A full-text copy of the Settlement Agreement between Registrant and 17-01 Pollitt Drive, L.L.C., dated September 30, 2009, is available at no charge at http://ResearchArchives.com/t/s?4691 Vyteris, Inc., holds approximately 50 U.S. patents relating to the delivery of drugs across the skin using a mild electric current and operates in one business segment. The Company is pursuing peptide and small molecule opportunities through, among other things, drug development partnerships. As of June 30, 2009, the Company had $1,051,443 in total assets and $35,151,494 in total liabilities, resulting in $34,100,051 in stockholders' deficit. The Company said the report of the independent registered public accounting firm relating to the audit of the Company's consolidated financial statements for the year ended December 31, 2008, contains an explanatory paragraph expressing uncertainty regarding the Company's ability to continue as a going concern because of its operating losses and its continuing need for additional capital. The Company said failure to obtain financing will require management to substantially curtail, if not cease, operations, which will result in a material adverse effect on the financial position and results of operations of the Company. WABASH NATIONAL: Cautiously Optimistic About 2010 Demand Recovery ----------------------------------------------------------------- Management of Wabash National Corporation said the Company is well positioned to manage through the current industry cycle and deliver sustainable profitability over the long-term. In a presentation to investors, management said the Company: -- has strong value proposition and unmatched suite of products with #1 position in North American trailer market; -- has strong customer relationships; -- is implementing cost control and efficiency improvements while right-sizing the business to match current demand; and -- has a three-year revolving credit facility with capacity of up to $100 million and completed a $35 million preferred share sale. The Company is cautiously optimistic about demand recovery in 2010. Wabash National said 2010 total trailer shipments are expected in the range of 88,000 to 116,000 units. The Company expects double digit year-over-year growth forecast through 2013, and replacement demand is estimated at 175,000 to 200,000 trailers in a normal year. The Company expects 2009 trailer orders between 11,000 and 13,000. A full-text copy of updated slides for use in connection with investor presentations is available at no charge at: http://ResearchArchives.com/t/s?468f As reported by the Troubled Company Reporter, Wabash on July 17, 2009, entered into a Third Amended and Restated Loan and Security Agreement, which was effective August 3, 2009, with Bank of America, N.A., as a lender and as agent and the other lender parties. The Credit Agreement has a maturity date of August 3, 2012. The Amended Facility has a capacity of $100 million, subject to a borrowing base, and borrowings outstanding totaled $25.5 million at August 3, 2009. The lenders waived certain events of default that had occurred under the previous credit facility and waived the right to receive default interest during the time the events of default had continued. About Wabash National Headquartered in Lafayette, Indiana, Wabash National Corporation is one of the leading manufacturers of semi-trailers in North America. Established in 1985, the company specializes in the design and production of dry freight vans, refrigerated vans, flatbed trailers, drop deck trailers, dump trailers, truck bodies and intermodal equipment. Its innovative core products are sold under the DuraPlate(R), ArcticLite(R), FreightPro(TM) Eagle(R) and Benson(TM) brand names. The company operates two wholly owned subsidiaries; Transcraft (R) Corporation, a manufacturer of flatbed, drop deck, dump trailers and truck bodies; and Wabash National Trailer Centers, trailer service centers and retail distributors of new and used trailers and aftermarket parts throughout the U.S. WARNER CHILCOTT: S&P Withdraws 'B+' Rating on $450 Mil. Notes ------------------------------------------------------------- Standard & Poor's Rating Service announced that it has withdrawn its 'B+' issue-level and '6' recovery rating on specialty pharmaceutical company Warner Chilcott Corp.'s proposed $450 million of senior unsecured notes. Warner Chilcott instead upsized its term loan B by $450 million to $1.950 billion, from $1.5 billion. All other ratings remain unchanged. Warner Chilcott Corp. is a wholly owned subsidiary of specialty pharmaceutical company Warner Chilcott plc. Ratings List Warner Chilcott Corp. Corporate Credit Rating BB/Stable/-- Senior Secured US$1.95 bil fltg rate bank ln ser due 2015 BB+ Recovery Rating 2 Rating Withdrawn Senior Unsecured To From -- ---- US$450 mil 8.75% nts ser due 2017 NR B+ Recovery Rating NR 6 WASHINGTON MUTUAL: Gets Court Nod for Bingham as Tax Counsel ------------------------------------------------------------ Washington Mutual Inc. and its affiliates obtained approval from the Bankruptcy Court to hire Bingham McCutchen LLP as their special tax counsel, nunc pro tunc to August 1, 2009. The Debtors relate that in November 2008, they were authorized to retain McKee Nelson LLP as their special tax counsel for tax controversy matters. Bingham merged with McKee in August 2009. As a result, all of McKee attorneys who previously represented the Debtors in their Chapter 11 cases will continue to represent the Debtors as partners or employees of Bingham. Specifically, prior to the Petition Date, McKee represented the Debtors in connection with tax controversy matters with the Internal Revenue Service relating to (i) the management of tax audit of a cross-border financing transaction within 2004 and 2005, and (ii) an audit and administrative appeal of certain partnership tax issues within 2001 to 2003. After the Petition Date, McKee continued to represent the Debtors in relation to, and became familiar with, the Debtors' tax and controversy matters. Given their long-standing engagement with McKee, it is appropriate for the Debtors to engage Bingham -- in light of the McKee-Bingham Merger -- to continue to perform legal services pertaining to the specialized nature of the Debtors' intricate tax issues and business operations. The Debtors will pay Bingham's professionals in accordance with these hourly rates: Designation Hourly Rate ----------- ----------- Partners and Of counsel $605 - $995 Associates and Counsel $300 - $590 Paraprofessionals $215 - $305 Bingham will also be reimbursed for its necessary out-of-pocket expenses. Rajiv Madan, Esq., a partner at Bingham, assures the Court that his firm does not hold or represent an interest adverse to the Debtors' estates. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WASHINGTON MUTUAL: JPMorgan Gets OK to Intervene in FDIC Suit ------------------------------------------------------------- Law360 reports that the court overseeing Washington Mutual Inc.'s suit against the Federal Deposit Insurance Corp. over the $1.9 billion sale of WMI's banking operations to JPMorgan Chase & Co. has allowed JPMorgan to intervene as a defendant in the case, rejecting the argument that the automatic stay from WMI's bankruptcy case barred JPMorgan from getting involved in the suit. Key Lawsuits Among Parties Washington Mutual filed a suit in March against the FDIC before the U.S. District Court in Washington after its claim in the bank receivership was denied. The Debtor seeks to recover $6.5 billion in capital contributions, $4 billion in preferred securities and $3 billion in tax refunds. The lawsuit contends the FDIC sold the bank for substantially less than the assets were worth. The holding company believes the bank's assets were worth more than the bank's debt. In April 2009, JPMorgan, which acquired Washington Mutual Bank, filed in the Bankruptcy Court a complaint against Washington Mutual and WMI Investment Corp., and Federal Deposit Insurance Corporation, seeking (i) to ensure that it is not divested of the assets and interests purchased in good faith from the FDIC, as receiver for WMB; and (ii) for indemnification and recovery against the Debtors for certain liabilities that may be asserted against JPMorgan, as successor by merger to WMB, pursuant to a Purchase and Assumption Agreement dated September 25, 2008, with the FDIC. In mid-April 2009, Washington Mutual countered with its own lawsuit against JPM in the Bankruptcy Court, seeking recovery of $4 billion it was holding in deposit accounts at its bank unit when the thrift unit was taken over in September by the FDIC and immediately transferred to JPMorgan Chase & Co. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WATER PIK: Moody's Upgrades Corporate Family Ratings to 'B2' ------------------------------------------------------------ Moody's Investors Service upgraded Water Pik, Inc.'s corporate family and probability-of-default ratings to B2 from B3, and the second lien term loan to Caa1 from Caa2. Moody's also affirmed the B1 rating on the company's first lien senior secured credit facilities. The upgrade of the corporate family rating reflects Water Pik's favorable operating performance and improvements in credit metrics since the original rating was assigned in May 2007. The upgrade also considers the company's good liquidity profile, which is supported by a large cash balance and meaningful cushion under financial covenants. Notwithstanding these positives, the rating is restrained by the company's modest scale, niche focus, and the continued challenging retail environment. The ratings outlook is stable. These ratings were upgraded: * Corporate family rating to B2 from B3; * Probability-of-default rating to B2 from B3; * $35 million second lien senior secured term loan due 2014 to Caa1 (LGD5, 85%) from Caa2 (LGD5, 84%). These ratings were affirmed: * $15 million senior secured revolving credit facility due 2013 at B1. Point estimate revised to (LGD3, 34%) from (LGD3, 33%); * $59 million first lien senior secured term loan due 2014 at B1. Point estimate revised to (LGD3, 34%) from (LGD3, 33%). The last rating action was on November 4, 2008, when Moody's changed Water Pik's ratings outlook to positive from stable and affirmed the B3 corporate family rating. Moody's also affirmed the B1 rating on Water Pik's first lien senior secured credit facilities and the Caa2 rating on its second lien term loan. Headquartered in Fort Collins, Colorado, Water Pik, Inc., sells dental water jets, power flossers, automatic toothbrushes, professional dental products, and replacement showerheads through its oral healthcare and showerhead divisions. WEATHERSFIELD: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Weathersfield Management, LLC fka Accuforce Staffing Services, LLC P.O. Box 599 Kingsport, TN 37662 Bankruptcy Case No.: 09-52756 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court Eastern District of Tennessee (Greeneville) Judge: Marcia Phillips Debtor's Counsel: Dean B. Farmer, Esq. Hodges, Doughty & Carson PLLC P.O. Box 869 Knoxville, TN 37901 Tel: (865) 292-2307 Fax: (865) 292-2252 Email: dfarmer@hdclaw. Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $5,971,959, and total debts of $6,110,016. A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/tneb09-52756.pdf The petition was signed by Larry Nunley, president and chief manager of the Company. WEST CORPORATION: Public Offering Won't Affect Moody's Ratings -------------------------------------------------------------- Moody's Investors Service stated that it does not expect to take any immediate rating action following West Corporation's announcement that it has filed for an initial public offering of its common stock. West indicated in its Form S-1 filing that it intends to use part of the net proceeds from the offering to repay or repurchase indebtedness. The last rating action on West Corporation was on May 8, 2007, at which time Moody's lowered the senior secured credit facility rating to B1 from Ba3 while affirming all other credit and liquidity ratings. Based in Omaha, Nebraska, West is a leading provider of business process outsourcing services. West has a B2 Corporate Family Rating and a stable rating outlook. WESTFALL TOWNSHIP: Board of Supervisors Block 1% Income Tax ----------------------------------------------------------- Stephen Sacco at Times Herald-Record reports that Westfall Township's Board of Supervisors has unanimously voted down a proposal to examine a 1% tax on earned income after residents objected to the tax. According to Times Herald-Record, homeowners are looking at a proposed 7.35% tax increase to pay off the settlement with developer David Katz, which will come to about $200 per homeowner. The income tax was aimed to offset the burden on homeowners, says Times Herald-Record. The report states that under the settelemtn, Westfall Township must pay Mr. Katz $300,000 per year in four quarterly installments of $75,000 for the next 20 years. Westfall Township filed its Chapter 9 petition on April 10, 2009 (Bankr. M.D. Pa. Case No. 09-02736). The primary purpose of Chapter 9 is to allow the municipality to continue its operations and its provision of services while it adjusts or restructures creditor obligations. In a Chapter 9 case, the jurisdiction and powers of the bankruptcy court are limited such that the court may not interfere with any of the political or governmental powers of the municipality, or the municipality's use or enjoyment of any income-producing property. WOODY HARRELL MEDLOCK: Case Summary & 11 Largest Unsec. Creditors ----------------------------------------------------------------- Joint Debtors: Woody Harrell Medlock, Sr. dba Murfreesboro Ambulance Services Kathy Diane Medlock 4428 Lascassas Highway Murfreesboro, TN 37130 Bankruptcy Case No.: 09-11456 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Middle District of Tennessee (Nashville) Judge: Keith M. Lundin Debtors' Counsel: Paul E. Jennings, Esq. Paul E. Jennings Law Offices, P.C. 805 South Church Street Suite 3 Murfreesboro, TN 37130 Tel: (615) 895-7200 Fax: (615) 895-7294 Email: paulejennings@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $1,302,704, and total debts of $1,680,144. A full-text copy of the Debtors' petition, including a list of their 11 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/tnmb09-11456.pdf The petition was signed by the Joint Debtors. YOURDAY INC: Case Summary & 16 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: YourDay, Inc. c/o Masud & Co. 60 State St., Suite 700 Boston, MA 02109 Case No.: 09-19581 Chapter 11 Petition Date: October 7, 2009 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Joan N. Feeney Debtor's Counsel: Robert Masud, Esq. Masud & Associates 60 State Street, Suite 700 Boston, MA 02109 Tel: (617) 720-1100 Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Olivery Iny, the company's president. ZUPEK'S INC: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Zupek's Inc. aka Irvine Ranch Market aka Original Irvine Ranch Market 2651 Irvine Ave J-1A1 Costa Mesa, CA 92627 Bankruptcy Case No.: 09-20745 Chapter 11 Petition Date: October 6, 2009 Court: United States Bankruptcy Court Central District of California (Santa Ana) Judge: Robert N. Kwan Debtor's Counsel: Roger J. Plasse, Esq. 16152 Beach Blvd, Suite 250 Huntington Beach, CA 92647 Tel: (714) 375-5898 Fax: (714) 375-6110 Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $10,000,001 to $50,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cacb09-20745.pdf The petition was signed by Yuiko David Wong, president of the Company. * Bank Failures Drive Record Mortgage-Related Closings ------------------------------------------------------ Driven by nearly 100 bank failures so far this year, mortgage- related failures and closings have already exceeded the total for all of last year and are within two failures of a record. From Jan. 1 through Oct. 2, there have been 164 mortgage-related firms that have either collapsed or been shut down, according to the Mortgage Graveyard -- a journal of failed lenders that is maintained by MortgageDaily.com. During all of 2008, a revised 124 mortgage-related firms either failed or were closed down. The increased activity is attributable to a burst of bank failures. As of Friday, 98 federally insured institutions have failed this year -- nearly 300 percent higher than in all of 2008. Mortgage-Related Closures 2009 2008 Company Type (through 10/2) (full-year) ------------ -------------- ----------- non-banks 53 85 banks 98 25 credit unions 13 14 Total 164 124 The number of mortgage-related closings in 2007 was a revised 165, the highest level since MortgageDaily.com began tracking failed lenders in 1998. But 2007's activity included only three banks. Among this year's biggest failures have been BankUnited, FSB, which failed in May; Guaranty Bank, which was seized in August; and Taylor, Bean and Whitaker Mortgage Corp., which collapsed after it was suspended by FHA, Freddie Mac and Ginnie Mae in August. "We are likely to see 2009's mortgage-related closings rise to more than 200 firms by the end of the year," said MortgageDaily.com Founder and Publisher Sam Garcia. "Based on the rising number of regulatory orders being issued against financial institutions -- the pace of bank failures is likely to get worse before improving." Last month, MortgageDaily.com tracked more than 100 regulatory actions against U.S. financial institutions -- including 56 cease- and-desist orders and 27 removal-and-prohibition orders. Because of the rapid pace of bank failures, the Federal Deposit Insurance Corporation -- which insures bank deposits -- is proposing to collect three years of risk-based assessments in advance this year so that its Deposit Insurance Fund has enough capital to handle upcoming failures. Complete details about all failed companies are available at: http://www.MortgageDaily.com/MortgageGraveyard.asp?spcode=pr About MortgageDaily.com Founded in 1998, MortgageDaily.com is a dominant online source of mortgage news for the mortgage industry. Around 1 million news pages are viewed monthly at MortgageDaily.com and affiliated publications. CONTACT: Sam Garcia SamGarcia@MortgageDaily.com 214.521.1300 3811-700 Turtle Creek Blvd. Dallas, TX 75219 * Debt-Market Paralysis Deepens Credit Drought ---------------------------------------------- ABI reports that the continued disarray in debt-securitization markets, which in recent years were the source of roughly 60 percent of all credit in the United States, is making loans scarce and threatening to slow the economic recovery. * Fed Scrutinizes Effects of Commercial Real Estate Downturn ------------------------------------------------------------ Banks in the U.S. "are slow" to take losses on their commercial real estate loans being battered by slumping property values and rental payments, according to a Federal Reserve presentation to banking regulators last month. * SEC Says Frank's Derivatives Plan May Leave "Regulatory Gaps" --------------------------------------------------------------- ABI reports that a Securities and Exchange Commission official is set to testify that Rep. Barney Frank's (D-Mass.) proposed overhaul of derivatives regulation may leave gaps in oversight and weaken the SEC's power to police fraud and manipulation. * Clear Thinking Group LLC Partner Resigns ------------------------------------------ Joseph Myers, a Clear Thinking Group LLC Partner and leader of the firm's Creditor Rights Services group, announced today that he intends to retire from those roles at the end of 2009. To ensure a smooth transition for the firm's Creditor Rights Services clients, Clear Thinking Group has named Dorene Robotti, Managing Director, as leader of the group. In her new role, Ms. Robotti will assume the management of Clear Thinking Group LLC's Creditor Rights Services group; effective immediately. Mr. Myers has had a brilliant 40 year business career serving in various managerial and executive positions, with companies such as Warnaco, Polo Ralph Lauren, Jim Walter Corporation, AGX Corporation, and Beach Patrol, prior to joining the Clear Thinking Group in 2002. Since becoming a Partner with the Clear Thinking Group, he has served in many capacities, often being appointed as Plan Administrator and Liquidation Trustee for bankruptcy post confirmation assignments. Stuart Kessler, President of Clear Thinking Group LLC stated, "Joe has been a pivotal part of our firm for a number of years. We will miss his experience, his wisdom, and his guidance as a Partner and leader of Creditor Rights Services. We wish him well in moving forward with this stage of his life." Dorene Robotti has been part of the Clear Thinking Group Creditor Rights team since 2004. Ms. Robotti brings over 25 years of experience in corporate, labor and bankruptcy law to her position, including 16 years as Vice President, Legal and Chief Labor Counsel for Ames Department Stores. She has also served as General Counsel and Chief Human Resources Officer for several start-up companies. Ms. Robotti is a member of the American Bankruptcy Institute and the Women's Insolvency & Restructuring Confederation, and is on the Board of Directors for the Connecticut Turnaround Management Association. "We are excited to have someone with Dorene's experience, knowledge, and passion, lead this part of our practice. While she is filling very large shoes, we are confident she will lead our team to provide excellent service to our client base," said Stuart Kessler. About Clear Thinking Group Clear Thinking Group is a national business advisory firm, where executive level professionals and their teams provide a unique perspective on business opportunities and challenges in a variety of industries such as: consumer product manufacturing, distribution, retail, textiles, and staffing services. Clear Thinking Group provides the research, planning and implementation that clients need at a moment's notice with careful, clear thinking. * Goldman Sachs Assistant Gen. Counsel Joins Chadbourne & Parke --------------------------------------------------------------- The international law firm of Chadbourne & Parke LLP disclosed that Richard Ross has joined the Firm as counsel in the corporate practice. He will be located in the Firm's New York office. Prior to joining Chadbourne, Mr. Ross was a Vice President & Assistant General Counsel in Merchant Banking Legal for Goldman, Sachs & Co. in New York. While at Goldman Sachs, his work included advising on transactions involving infrastructure and real estate assets. "Richard has a wide range of legal experience in the corporate, investment banking and financial services areas that will be of great benefit to our clients," said Chadbourne Managing Partner Charles K. O'Neill. "We welcome him to the Chadbourne team." "Richard's experience with the Merchant Banking Legal team at Goldman Sachs and his strong M&A experience will be invaluable to Chadbourne," added Corporate Practice Head Allen Miller. Before he joined Goldman Sachs, Mr. Ross was a senior associate in the mergers and acquisitions practice at Skadden, Arps, Slate, Meagher & Flom LLP. In that capacity, Mr. Ross represented clients in public and private company M&A matters, including hostile and restructuring transactions. Among the types of transactions Mr. Ross has worked on in both his in-house and law firm positions are those in the toll roads, ports, rails and regulated utilities sectors as well as proxy contests, spin-offs and private equity deals. Mr. Ross received a J.D. from Cornell Law School and an M.B.A. from the Johnson Graduate School of Management at Cornell University, both in 1999. Additionally, he received his B.S. from the University of California, Berkeley in 1984, and an M.A. from Stanford University in 1993. About Chadbourne & Parke LLP Chadbourne & Parke LLP -- http://www.chadbourne.com.-- an international law firm headquartered in New York City, provides a full range of legal services, including mergers and acquisitions, securities, project finance, private funds, corporate finance, energy, communications and technology, commercial and products liability litigation, securities litigation and regulatory enforcement, special investigations and litigation, intellectual property, antitrust, domestic and international tax, insurance and reinsurance, environmental, real estate, bankruptcy and financial restructuring, employment law and ERISA, trusts and estates and government contract matters. Major geographical areas of concentration include Central and Eastern Europe, Russia, the Middle East and Latin America. The Firm has offices in New York, Washington, DC, Los Angeles, Mexico City, London (a multinational partnership), Moscow, St. Petersburg, Warsaw, Kyiv, Almaty, Dubai and Beijing. * Sage Holdings Acquires Donlin Recano -------------------------------------- Sage Holdings has acquired Donlin, Recano & Company, Inc., a Chapter 11 claims and noticing agent. DRC will continue to provide claims administration and noticing support services to its clients, partnered with the expanded operating platform provided by Sage Holdings and its subsidiaries, such as D. F. King & Co., Inc., a leading independent proxy solicitation firm with offices in New York and London. DRC's services include pre-Chapter 11 filing preparation, Chapter 11 noticing solutions, claims management, balloting and distribution services. DRC also provides information support services to committees of unsecured creditors appointed in Chapter 11 cases. Dr. Oliver Niedermaier, President and Chief Executive Officer of Sage Holdings, commented: "With this acquisition, Sage Holdings has extended its offerings to include the full range of services required by companies at all stages of the bankruptcy process. This is a high-growth area for our business." Based in New York and Chicago, DRC uses proprietary technologies to organize and guide clients through the bankruptcy process, a service which is now enhanced by, among other things, the expanded printing, call center and technology platforms offered by Sage Holdings companies. Louis A. Recano, Chief Executive Officer of DRC, commented: "Becoming part of the Sage Holdings family will bring important and significant benefits to our current and future clients. Our new sister companies have tried-and-tested communications platforms for large-scale projects, along with extensive experience and skill in preserving brand, management and corporate integrity on a global basis, all of which complements our expertise in bankruptcy management services, while reinforcing our long-standing commitments to efficiency and client service." Peter C. Harkins, President and Chief Executive Officer of D. F. King & Co., Inc., commented: "In addition to the experience and skill of DRC's professionals, clients of DRC will now enjoy immediate access to D. F. King's integrated information technology, financial printing, material distribution and call center services, along with our investor and creditor identification, financial communications and vote solicitation services, on the scale required to maximize efficiencies in the bankruptcy process." Media Inquiries: For Sage Holdings Michael Henson Telephone: +1 (212) 889-4350 E-mail: mhenson@sageholdings.com For Donlin, Recano & Company, Inc. Scott Y. Stuart, Esq. Telephone: +1 212 481-1411 E-mail: sstuart@donlinrecano.com About Sage Holdings: Sage Holdings -- http://www.sageholdings.com/-- is the leading global financial communications and stakeholder management firm. Formed in 2007, with private equity backing from The Riverside Company (http://www.riversidecompany.com),Sage Holdings companies include: Capital Precision, a capital markets intelligence specialist (www.capitalprecision.com); M:Communications, Europe's fastest growing financial communications consultancy (http://www.mcomgroup.com/);Hallvarsson & Halvarsson, the top- ranked Scandinavian financial communications firm (http://www.halvarsson.com/);Broadgate Consultants, a Wall Street investor and financial media relations consultancy (http://www.broadgate.com/);D. F. King, a leader in corporate M&A transactions, proxy solicitation and related stakeholder services in the U.S. and Europe (http://www.dfking.com/);Donlin Recano, a leading Chapter 11 claims and noticing agent (http://www.donlinrecano.com/);and Taylor Rafferty, a leading international investor relations firm with offices in New York, Europe and Asia (http://www.taylor-rafferty.com/). With offices in New York, London, Dubai, Munich, Stockholm and Hong Kong, Sage Holdings serves over 1,000 public companies, mutual fund families and private equity clients and employs over 350 professionals supported by ~1,400 call center employees. Sage Holdings is structured along three business segments: consulting; analytics and technology; and stakeholder fulfillment. Sage Holdings has built an international business of substantial value in these areas and expects to continue growing through further complementary acquisitions in each of the world's major financial centers. * SecondMarket Acquires InsideVenture ------------------------------------- SecondMarket has acquired Menlo Park-based InsideVenture, a facilitator of financing for late-stage private companies. With this announcement, SecondMarket will add a capital introduction service to its robust secondary market for private company stock. As part of the transaction, SecondMarket also announced the opening of its Silicon Valley office. "This is an exciting acquisition for SecondMarket as we look to expand our position as the leading marketplace for private company stock," said SecondMarket CEO Barry E. Silbert. "InsideVenture's ability to match exciting, venture-backed companies with investment banks and top-tier investors adds an important capital introduction service to SecondMarket's leading secondary program," added Mona DeFrawi, founder and CEO of InsideVenture. As part of the acquisition, New Enterprise Associates, Inc. and SVB Financial Group will both take equity stakes in SecondMarket. The specific terms of the deal were not disclosed. "We are thrilled to be involved with an innovative company like SecondMarket that is bringing much-needed liquidity to venture- backed companies and their investors," said Chuck Newhall, General Partner and Co-Founder of NEA. "This acquisition allows private companies to benefit from SecondMarket's secondary expertise along with InsideVenture's success in connecting late-stage companies to capital from high-value investors." Launched earlier this year, the SecondMarket private company program, which allows companies to control the secondary market for their own shares, has garnered significant support from both entrepreneurs and the venture capital community. "We have monitored this market closely, and SecondMarket has clearly emerged as the industry expert," said Mark Heesen, President of the National Venture Capital Association. "We believe that SecondMarket has the right model to help fill the gap that exists in the capital formation process as a result of the systemic issues that have arisen in the public markets over the past decade." SecondMarket has facilitated over $1 billion in transactions in 2009, including tens of millions of dollars of transactions in leading private companies, and nearly 20 companies have already signed up for its private company program. Currently SecondMarket has over $200 million in private company stock available for sale. "We have been extremely successful in working directly with companies and their shareholders to facilitate secondary liquidity," said SecondMarket's Silbert. "With our acquisition of InsideVenture, we are adding the primary raise piece that is so critical for fast growing companies. We look forward to working with investment banking advisors, the country's top venture capitalists and asset managers to help private companies finance their growth and development." In addition to private company stock, SecondMarket has established itself as the leading centralized marketplace for a variety of assets, including limited partnership interests, auction-rate securities, bankruptcy claims, residential and commercial mortgage-backed securities, collateralized debt obligations, warrants/restricted stock in public companies and whole loans. About SecondMarket Founded in 2004, New York-based SecondMarket is the world's largest marketplace for illiquid assets, such as auction-rate securities, bankruptcy claims and restricted securities in public companies. SecondMarkets online trading platform has more than 1,500 members, including global financial institutions, hedge funds, private equity firms, mutual funds, and other institutional and accredited investors that collectively manage over $250 billion in assets available for investment. SecondMarket is a wholly owned division of Green Drake, Inc. (Member FINRA/SIPC). * Thomas Walper Rejoins Munger, Tolles & Olson Bankruptcy Group --------------------------------------------------------------- Thomas B. Walper, a senior bankruptcy lawyer and restructuring professional, has rejoined Munger, Tolles & Olson as a partner. For the past two years, Mr. Walper has been head of corporate restructuring for investment firm Plainfield Asset Management in Greenwich, Conn. Prior to that, Mr. Walper had been a partner at Munger, Tolles & Olson for 16 years. "Tom's business experience and his years of bankruptcy practice make him an invaluable addition to our bankruptcy and reorganization practice," said Sandra Seville-Jones, co-managing partner of Munger, Tolles & Olson. "We are fortunate to welcome back an MTO veteran in a critical practice area given the difficult economy." While at MTO, Mr. Walper played a significant role in many of the country's largest chapter 11 cases and restructurings, including Refco, Calpine, Pacific Gas & Electric, Southern California Edison, Kmart, United Airlines, Southern Pacific Funding, California Power Exchange and Coho Energy. Mr. Walper was the lead bankruptcy counsel for Berkshire Hathaway Inc. for several years representing them in connection with the Enron, FINOVA Group, Fruit of the Loom, Oakwood Homes, and USG Corporation bankruptcy cases. At MTO, Mr. Walper's practice will include the representation of debtors, creditors, creditors' committees, unsecured creditors, and boards of directors, as well as the representation of acquirers and sellers of financially troubled companies, both in and outside of bankruptcy. "I am invigorated to come back to the practice of law with the significant experiences I have gleaned from my role as a buy-side principal," Mr. Walper said. "The current economic conditions have led to some of the most sophisticated and challenging bankruptcy work the industry has seen, and I am looking forward to helping our clients in these complex times." At Plainfield, Mr. Walper contributed to the analysis and underwriting of investments in distressed securities and private transactions and developed and implemented both consensual and litigated exit strategies for distressed private and public investments. In this role, he acted as a principal representative on numerous formal and informal creditors committees. Mr. Walper first joined MTO in 1991, after serving as a partner in Stroock & Stroock & Lavan's bankruptcy group. Mr. Walper has twice been recognized by Turnarounds and Workouts magazine as one of the country's top 12 bankruptcy lawyers. * BOOK REVIEW: Unique Value: The Secret of All Great Business Strategies ------------------------------------------------------------- Andrea Dunham and Barry Marcus, with Mark Stevens and Patrick Barwise Publisher: Beard Books Softcover: 303 pages List Price: $34.95 by Henry Berry "Never stop leveraging what you do uniquely well," the authors advise. Every good manager knows how to leverage business strengths. The challenge is identifying a corporation's unique value; which is, in most cases, an interrelated set of strengths. This 1993 reprint instructs the reader on the process and method for determining unique value: how to recognize it, how to inculcate it into the corporate culture, and how to keep it in focus and preserve it during changing business conditions. Employing charts and diagrams, Ms. Dunham and Mr. Marcus illustrate their trademarked Unique Value = ROI Model. ROI -- return on investment -- is a familiar business ratio. However, it is not ordinarily linked to something called "unique value." The authors make a compelling argument that the two are related. In fact, a case can be made that nearly every business achieves its ROI from its unique value. With Ms. Dunham and Mr. Marcus offering this new perspective on ROI, one quickly realizes that unique value (and ROI) is a function of marketing, customer relations, strategic planning, and other less tangible factors. The reader draws the conclusion that ROI is as much a result of image or market presence as it is financial planning and management. The Unique Value Model is best seen as a pyramid with the "informing concept" of unique value at its peak. The pyramid has four bases: Consumer/Customer, Business Systems and Skills, Product/Technology, and Competition. These are the four major interrelated factors of any business organization. The authors posit that each of these factors must be "analyzed, structured, and fully understood" for the Unique Value = ROI Model to be informative and effective. Unique value is ultimately concerned with decision-making and operations. This is what Mr. Marcus and Ms. Dunham mean by their advice to "never stop leveraging what you do uniquely well." The authors demonstrate how corporate leaders can apply their knowledge of unique value to shape employee activity and interactions with customers and clients, plan marketing campaigns, decide upon the content and style of advertising, follow closely what certain competitors are doing, look for profitable acquisitions, and adroitly manage all the other activities upon which the success of the corporation depends. Mid- and lower- level employees may not even know there is a core concept of unique value; but they will be a part of its embodiment from the leadership of executives and managers. IBM, Frito-Lay, Seagram's, Yamaha, and Holiday Inn are some of the prominent companies used as examples of how unique value can be applied to ROI. Aspects of the model are already widely practiced by many successful corporations. After reading this book, it's hard to imagine how a corporation can be successful without heeding the principles of unique value. The challenges posed by today's business environment are greater than ever. Competition is fierce, both at home and from abroad; consumer demands are fickle; and government policy pervades everything from taxes to the environment. Corporations that can clearly articulate and unerringly implement their unique value have an advantage over their competitors. Andrea Dunham and Barry Marcus were partners in founding the management and marketing consulting firm Dunham & Marcus. Mr. Marcus is CEO of Unique Value International, a consulting firm in the areas of marketing and brand development. ********* 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 **