/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100330.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, March 30, 2010, Vol. 14, No. 88 Headlines 2000 ST JAMES: U.S. Trustee Unable to Form Creditors Committee 2151 HOTEL: Court Dismisses Chapter 11 Reorganization Case ABITIBIBOWATER INC: ACI's Stay Period Extended Until June 18 ABITIBIBOWATER INC: U.S. Court OKs Sale of Alabama Pulp ABITIBIBOWATER INC: U.S. Court OKs Sale of Rhea Timberland AFFINION GROUP: S&P Assigns 'BB-' Rating on $1 Bil. Senior Loan AFFINITY GROUP: Three Directors Resign from Board AGE REFINING: Court to Control Banker's Fees ALOHA SPORTS: Files for Bankruptcy Protection in Hawaii AMBAC ASSURANCE: Moody's Places 'Caa2' IFSR on Review for Upgrade AMBAC FINANCIAL: Moody's Downgrades Senior Debt Rating to 'C' ARES CAPITAL: Moody's Confirms 'Ba1' Rating with Stable Outlook AMERICAN RACING: Cancels Registration of Common Stock AUGUSTA APARTMENTS: Has Access to Cash Collateral Until April 26 AUGUSTA APARTMENTS: U.S. Trustee Unable to Form Creditors Panel AUGUSTA APARTMENTS: Files List of Largest Unsecured Creditors BIGLER LP: Plan Uncertain If Able to Pay Unsecured Creditors BIO-KEY INTERNATIONAL: Reports $4.7 Million Net Income in 2009 BIOVEST INT'L: Laurus Master Fund Holds 9.99% of Shares BLOCKBUSTER INC: OKs Slate of Director Nominees for Submission BLUE HERON: Gets Final OK to Access Wells Fargo's Cash Collateral BLUE HERON: Creditors Have Until May 3 to File Proofs of Claim BOSQUE POWER: Moody's Withdraws 'Caa2' Rating on Senior Loan BOSQUE POWER: S&P Drops Sr. Debt Rating to 'D' on Ch. 11 Filing BRENTWOOD APARTMENTS: Has Until May 10 to Propose Chapter 11 Plan BRENTWOOD APARTMENTS: Taps Stichter Riedel as Bankruptcy Counsel BRENTWOOD APARTMENTS: Files Schedules of Assets and Liabilities BROSSIER CO: Files for Chapter 11 Bankruptcy to Avert Foreclosure BUFFET INC: Moody's Affirms 'Caa1' Corporate Family Rating CALVIN WHITE: Committee Taps Southwell & O'Rourke as Counsel CALVIN WHITE: U.S. Trustee Appoints 3-Member Creditors Committee CALVIN WHITE: Files Schedules of Assets and Liabilities CAMP COOLEY: Has Until April 8 to Propose Reorganization Plan CAROLINA CARGO: Returns to Chapter 11 CENTRAL PARKING: Moody's Downgrades Corp. Family Rating to 'B3' CHAPARRAL ENERGY: CCMP to Invest $345-Mil. to Buy Stake CIMINO BROKERAGE: Can Access Temple-Inland's Cash Until April 16 CITIGROUP INC: Treasury to Unload All Common Shares This Year CLEARPOINT BUSINESS: ComVest Capital Holds 56.7% of Shares CLEARPOINT BUSINESS: To Discontinue Quotation of Stock on OTCBB COMFORCE CORP: ARTRA 524(g) Asbestos Trust Holds 8.4% of Shares COMFORCE CORP: RBF Capital Holds 9.51% of Common Stock COMFORCE CORP: WC Capital Management Holds 4.6% of Shares COMMERCIAL VEHICLE: Completes Public Offering of Common Stock CONVERSION SERVICES: Friedman LLP Raises Going Concern Doubt COOPER-STANDARD: Court OKs Equity Investment Pact with Noteholders COOPER-STANDARD: CSA Canada Gets OK to Pay RSM, Ogilvy COVER-ALL BUILDING: Filed for Bankruptcy Under Canadian Law COYOTES HOCKEY: Financing Hinges on Arena Lease Rework CRESCENT RESOURCES: Confirmation Hearing Set for May 20 DELPHI CORP: Makes Tax Payments to Howard County DELPHI CORP: Lockport Workers Balk at GM Concessions DELPHI CORP: Flint Workers Eligible for Trade Assistance DELTA AIR: Janus Capital Discloses 6.7% Equity Stake DELTA AIR: Wellington Reports 11.23% Equity Stake DUANE READE: December 26 Balance Sheet Upside-Down by $226.7MM DUNE ENERGY: NYSE Amex Accepts Firm's Plan for Compliance EDWARD MARANDOLA: Files List of 20 Largest Unsecured Creditors EDWARD MARANDOLA: Taps Raskin & Berman as Bankruptcy Counsel ELLICOTT SPRINGS: Files Schedules of Assets and Liabilities ERNIE JACOBSEN: Hearing on Plan Filing Extension Set for April 8 FAIRVUE CLUB: Has Until April 20 to Propose Reorganization Plan FAYETTEVILLE MARKETFAIR: No Creditors Committee Appointed FILI ENTERPRISES: Court Sets April 26 as Claims Bar Date FLYING J: Gets Approval to Lease Stores to Denny's FREEDOM COMMUNICATIONS: Gets Nod to Sell Arizona Newspapers FREEPORT-MCMORAN: Fitch Affirms Preferred Stock Rating at 'BB' FREMONT GENERAL: Court Approves Closing Agreement with IRS GENCORP INC: Moody's Upgrades Corporate Family Rating to 'B2' GENCORP INC: Notes of Continued Progress on Cash Flow Goals GENERAL GROWTH: Begins Filing Omnibus Claims Objection GENERAL GROWTH: Kirkland & Ellis, 4 Others Adjust Fees GENERAL GROWTH: Elliot Assoc. Has 2.2% Equity Stake GENERAL MOTORS: Reveals Financial Leadership Changes GENTA INC: Arcus Ventures Holds 9.9% of Common Stock GENTA INC: Boxer Capital Holds 9.99% of Common Stock GREEKTOWN HOLDINGS: Noteholders Oppose to Case Closing This Month GREEKTOWN HOLDINGS: Settlement with City of Detroit Approved GREEKTOWN HOLDINGS: MGCB OKs Tax Rollback for Casino GREEKTOWN HOLDINGS: Luna Wants Payment of Attorney's Fees GUIDED THERAPEUTICS: Roth and Stark Hold Less Than 5% of Shares GUIDED THERAPEUTICS: SDS Capital Holds 5.32% of Common Stock HAWAIIAN TELCOM: Gets OK to Pay Incentives to Union Employees HAWAIIAN TELCOM: Zolfo Cooper's Fees Reeduced to $90,000 Per Month HAWAIIAN TELCOM: Court OK's Kirkland's $2.61-Mil. Fees for Q4 INDALEX INC: Buyer Won't Assume Pension Plan; PBGC Steps In INTERNATIONAL COAL: Amends Terms of Tender Offer for 9% Notes INTERSTATE HOTELS: Moody's Confirms 'Caa1' Corporate Family Rating IRVINE SENSORS: Inks Subscription Deals with 55 Creditors JOHN HENRY: Moody's Assigns 'B2' Rating on $245 Million Loan JOSEPH CHARLES LOOMIS: US Trustee Fails to Name Creditors Panel KIDDIE KANDIDS: CPI Corp. Offers $2.6 Million for Assets KLCG PROPERTY: KeyLime Water Park Goes to Dougherty in Debt Swap LAS VEGAS MONORAIL: Ambac Split Leaves Bond Default Probability LAURUS MASTER FUND: Holds 9.99% of Biovest Int'l Shares LENNY DYKSTRA: Chapter 7 Trustee Disputes Bid to Close Case MAX & ERMA'S: Selling Restaurant Items and Equipment MERIDIAN RESOURCE: Settles Consolidated Leider Action M & Z: Gets Court's Nod to Hire Marshack Hays as Bankr. Counsel METRO-GOLDWYN-MAYER: Creditor Says Bankruptcy Likely MIDWEST GAMING: Moody's Assigns 'B3' Corporate Family Rating MOHAWK INDUSTRIES: S&P Affirms 'BB+' Corporate Credit Rating MONROE MOTOR: Files for Chapter 11 Bankruptcy Protection MOVIE GALLERY: To Close More Than 200 Video Stores MOVIE GALLERY: Accommodation Pact with Hollywood Studios Approved MOVIE GALLERY: Proposes Protocol for Misc. Assets Sale MOVIE GALLERY: Parties Object to Cash Collateral Use MOVIE GALLERY: Site Woodstock, et al., Want Lease Payments NEIMAN MARCUS: S&P Changes Outlook to Stable; Affirms 'B' Rating NEW COMMUNICATIONS: S&P Assigns 'BB' Rating on $500 Mil. Notes NORTEL NETWORKS: Ontario Court Rejects Deal with Ex-Employees N.Y.C. OFF-TRACK: Seeks to Defer Payments to Racetracks OCCULOGIX INC: Posts $4.4 Million Net Loss in 2009 OCCULOGIX INC: Hudson Bay Discloses Equity Stake OCCULOGIX INC: Cranshire Capital Holds 6.2% of Common Stock OLLIE'S NOODLE: Files for Bankruptcy After Labor Suit Loss OSAGE EXPLORATION: GPKM LLP Raises Going Concern Doubt PACIFIC ETHANOL: Files Plan of Reorganization PACIFIC PANORAMA: U.S. Trustee Fails to Appoint Creditors Panel PACIFIC PANORAMA: Taps David A. Riggi as Bankruptcy Counsel PACKAGING DYNAMICS: S&P Puts 'B-' Rating on CreditWatch Positive PETER CAPONE: Wants to Hire Michaelson Susi as Bankruptcy Counsel PRA INTERNATIONAL: Moody's Gives Stable Outlook; Keeps 'B3' Rating PRESSTEK INC: Posts $49.8 Million Net Loss for FY Ended Jan. 2 PRM REALTY: Wants to Hire Pronske & Patel as Bankruptcy Counsel RADIOSHACK CORP: Exploring Strategic Options Including Asset Sale RATHGIBSON INC: Court Okays Sale Process; May 19 Auction Set REDDY ICE: S&P Raises Corporate Credit Rating to 'B-' RICK BRUNSMAN: Files for Bankruptcy to Liquidate Businesses RIVIERA HOLDINGS: Ernst Young Raises Going Concern Doubt ROUNDY'S SUPERMARKETS: Moody's Puts 'Caa1' Rating on $150MM Debt ROUNDY'S SUPERMARKETS: S&P Gives Stable Outlook; Keeps 'B' Rating SBARRO INC: Posts $37.3 Million Net Loss for 2009 SENSATA TECHNOLOGIES: S&P Raises Corporate Credit Rating to 'B' SIMON WORLDWIDE: Posts $2.1 Million Net Loss in 2009 SMURFIT-STONE: Proposes Winston & Strawn as Special Counsel SMURFIT-STONE: Panel Wants to Retain Fisher as Expert Witness SMURFIT-STONE: FTI to Provide Valuation Services to Panel SMURFIT-STONE: Monitor Files 11th Report on Canada Unit SPECIALTY PACKAGING: Authorized to Sell Assets for $14 Million SPHERIS INC: May Pay Bonuses After Secured Claims Are Paid STANDARD PACIFIC: S&P Raises Corporate Credit Rating to 'B' SUNTRUST BANKS: Fitch Downgrades Long-Term Issuer Default Ratings SUNWEST MANAGEMENT: $1.3-Bil. from Blackstone Group Leads Bidding TLC VISION: Plan Scheduled for May 5 Confirmation Hearing TOYS "R" US: Posts $312 Million Net Income Qtr. Ended Jan. 30 TRIBUNE CO: Gets Nod for $30-Million Letter of Credit Deal TRIBUNE CO: Incentive Plan Proposal Dismissed with Prejudice TRIBUNE CO: Wants WTC Held in Contempt for Filing Lawsuit UAL CORP: Sees 'Real Signs of Recovery' in Pacific WASHINGTON MUTUAL: Senior Bondholders Oppose JPM Settlement YL WEST: Taps Marilyn Simon as Bankruptcy Counsel YRC WORLDWIDE: CEO Bill Zollars' Pay Down 44% in 2009 ZALE CORP: Inks Amended Employment Security Deal with M. Appel ZANETT INC: Regains Compliance With NASDAQ Listing Rule * Large Companies with Insolvent Balance Sheets ********* 2000 ST JAMES: U.S. Trustee Unable to Form Creditors Committee -------------------------------------------------------------- Charles F. McVay, the U.S. Trustee for Region 7, notified the U.S. Bankruptcy Court for the Southern District of Texas that he was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of 2000 St. James Place, L.P. The U.S. Trustee said that there were insufficient indications of willingness from unsecured creditors to serve in the committee. Houston, Texas-based 2000 St. James Place, L.P., filed for Chapter 11 bankruptcy protection on February 2, 2010 (Bankr. S.D. Tex. Case No. 10-30993). Adrian Stanley Baer, Esq., at Cordray Tomlin P.C., assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and debts in liabilities in its petition. 2151 HOTEL: Court Dismisses Chapter 11 Reorganization Case ---------------------------------------------------------- The U.S. Bankruptcy Court Central District of California dismissed the Chapter 11 case of 2151 Hotel Circle South, LLC, due to (i) the Debtor's unauthorized use of cash collateral; (ii) failure to provide proof of workmen's compensation insurance; and (iii) the absence of a reasonable likelihood of rehabilitation. Woodland Hills, California-based 2151 Hotel Circle South, LLC, filed for Chapter 11 on January 4, 2010 (Bankr. C.D. Calif. Case No. 10-10065). The Law Offices of Alexander Lebecki assists the Debtor in its restructuring effort. In its petition, 2151 Hotel listed assets and liabilities both ranging from $10,000,001 to $50,000,000. ABITIBIBOWATER INC: ACI's Stay Period Extended Until June 18 ------------------------------------------------------------ Honorable Mr. Justice Clement Gascon, J.S.C., of the Superior Court Commercial Division for the District of Montreal in Quebec, Montreal, Canada, extended the period within which no right may be exercised and no proceeding may be commenced or proceeded against Abitibi-Consolidated Inc., Bowater Inc., and certain of their affiliates as applicants under the Companies' Creditors Arrangement Act of Canada through and including June 18, 2010. The Fourth Extension of the CCAA Stay Period, according to the CCAA Applicants, is necessary in order to provide them "an adequate period of time to move forward with the claims process and to continue discussions with their stakeholders with a view to assembling a restructuring plan under the CCAA." 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 28 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: U.S. Court OKs Sale of Alabama Pulp ------------------------------------------------------- The U.S. Bankruptcy Court authorized Alabama River Newsprint Company to sell to Alabama River Pulp Company, Inc. and Alabama Pine Pulp Company its 220,000-ton-per-year newsprint mill in Claiborne, Alabama, which was built pursuant to ARN's funding and construction agreement with The Industrial Development Board of Monroe County, Alabama in 1988. The Buyers will make one-time cash payment of $1,250,000 to ARN payable at the closing of the Sale. ARN, for its part, will execute and deliver Amendment No. 3 of a services agreement between the Debtors and ARP to restructure their relationship and align it more closely with the Newsprint Mill's actual needs. At Closing, all of the Debtors' right, title and interest in and to, and possession of, the Property will be immediately vested in ARP and APP, pursuant to Sections 105(a), 363(b), 363(f) and 365 of the Bankruptcy Code, free and clear of any and all liens, claims, interests and encumbrances, Judge Carey ruled. Prior to the Court's entry of its approval order, Gordon Cole, vice president of Energy, Strategy, Hydro and Asset Management of AbitibiBowater, Inc., affirmed that the Sale "is a product of good faith, arm's-length negotiations" between ARN, ARP and APP. According to the Debtors, no parties-in-interest filed objections to their request. 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 28 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: U.S. Court OKs Sale of Rhea Timberland ---------------------------------------------------------- U.S. Bankruptcy Judge Kevin Carey approved, in all respects, real property sale contracts to consummate the sale of 997 acres of timberland in Rhea County, Tennessee, owned by Debtor Bowater Inc. to Rachel M. Pruett for an aggregate of $1,096,700 or $1,100 per surveyed acre. The Debtor will transfer the Timberland Property to Ms. Pruett, free and clear of all liens, claims and encumbrances. Kent Cumberton, director of the U.S. Wood Products Division of AbitibiBowater, Inc., noted that the Debtors did not appraise the Property due to the expenses that it would incur, as well as the lack of comparable sales information. He nevertheless assured the Court that the Purchaser's offer of $1,100 per acre "is a fair, reasonable, and indeed, favorable purchase price." The Debtors noted that they received no objections to their request. 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 28 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). AFFINION GROUP: S&P Assigns 'BB-' Rating on $1 Bil. Senior Loan --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its issue-level and recovery ratings to Affinion Group Inc.'s $1 billion senior secured credit facilities, consisting of $875 million in term loan facilities due 2016 and a $125 million revolving credit facility due 2015. S&P assigned the loans an issue-level rating of 'BB-' (one notch higher than the 'B+' corporate credit rating on the company) with a recovery rating of '2', indicating S&P's expectation of substantial (70% to 90%) recovery for lenders in the event of a payment default. At the same time, S&P affirmed its existing ratings on Affinion, including the 'B+' corporate credit rating. The rating outlook is stable. Affinion Group Inc. is the operating subsidiary of Affinion Group Holdings Inc. The company plans to use loan proceeds to refinance its existing credit facilities and provide cash to help fund anticipated acquisitions. The transaction will extend debt maturities and reset financial covenants, while slightly negatively affecting credit measures. Pro forma total debt at Affinion was $1.9 billion as of Dec. 31, 2009. "The 'B+' corporate credit rating reflects S&P's concern about membership attrition in many of Affinion's services, some affinity partner concentration, competitive pressures in the membership marketing business, and high debt leverage," said Standard & Poor's credit analyst Hal Diamond. "The company's leading position in membership marketing, recurring revenue streams from renewals, and positive discretionary cash flow are modest positives that do not offset these risks." Affinion is a direct marketer of membership, insurance, and credit card ancillary services, primarily sold under the names of affinity partner institutions, such as financial institutions and retailers. The company's top ten U.S. marketing partners generated about 71% of U.S. membership revenue in 2009 and represented 45% of total revenue. This suggests some concentration risk, but the actual risk is lower because Affinion typically controls and retains the underlying existing retail customer relationships. The vast majority of its marketing agreements allow the company to extend or renew memberships and to bill and collect associated membership fees following any termination. Revenue declined in 2009, while EBITDA was roughly flat, as increasing revenue per member and cost reductions offset member attrition. Average retail membership declined 5.6% in 2009, while average revenue per member increased 3.5%, reflecting the shift to higher-priced monthly memberships. The EBITDA margin increased to 22.7% in 2009, from 22.1% in 2008. Pro forma gross debt to EBITDA, adjusted for operating leases, increases to 6.4x for 2009, from the actual level of 5.6x, due to the overfunding of the refinancing with roughly $220 million in incremental debt and cash. Pro forma EBITDA coverage of interest expense declines to 1.7x from 1.9x. Conversion of EBITDA to discretionary cash flow in 2009 increased to 14.8%, from 9.6% in 2008, primarily because of reduced working capital usage. In September 2009, the company elected its option to pay interest in kind on its $279.4 million of holding company senior unsecured term loan, resulting in a cash savings of $13 million. S&P anticipates that the conversion rate will improve further in 2011 should the company decide to continue to pay interest in kind on this instrument until maturity on March 15, 2012. AFFINITY GROUP: Three Directors Resign from Board ------------------------------------------------- Affinity Group Holding Inc. said David Frith-Smith, J. Kevin Gleason, George Pransky and Townsend C. Smith resigned from the Board of Directors in order to reduce the size of the Board, reduce expenses and streamline decision-making by the Board. About Affinity Group Affinity Group Holding, Inc., is a large member-based direct marketing company, targeting North American recreational vehicle owners and outdoor enthusiasts. The company reported net revenue of $506 million for the LTM period ended March 31, 2009. At September 30, 2009, the Company had $230,111,000 in total assets against $560,760,000 in total liabilities, resulting in $330,649,000 in stockholders' deficit. The September 30 balance sheet showed strained liquidity: The Company had $117,673,000 in total current assets against $291,986,000 in total current liabilities. Affinity Group carries a 'Caa1' long term corporate family rating from Moody's and a 'CCC' issuer credit rating from Standard & Poor's. AGE REFINING: Court to Control Banker's Fees -------------------------------------------- Bill Rochelle at Bloomberg News reports that Age Refining Inc. filed an operating report for February showing a $2.7 million loss before interest, taxes, depreciation and amortization on revenue of $15.2 million. The net loss for the month was $3.6 million. According to the report, Age was given final authority last week to hire an investment banker, although the bankruptcy judge changed some of the terms of the engagement. The banker, Global Hunter Securities LLC, must have all its fees ultimately approved by the bankruptcy judge and cannot be reimbursed for legal expenses in negotiating the engagement or defending a fee application, unless it comes out on top in the fee objection. Age Refining Inc. obtained approval from the Bankruptcy Court to commence a sale process for its business. It has set an April 15 deadline for initial bids in order to select the stalking horse bidder. Parties are to submit competing bids against the stalking horse bidder by May 1, and an auction will be held May 5 if bids are received. The sale will be approved as part of the process of confirming a Chapter 11 plan. A syndicate of lenders led by JPMorgan Chase Bank, N.A., as administrative agent, is providing the Debtor with $35 million of financing to fund the Chapter 11 case. The terms of the DIP financing, however, requires a quick sale. A plan is also required by March 31. About Age Refining Age Refining, Inc., based in San Antonio, Texas, manufactures, refines and markets jet fuels, diesel products, solvents and other highly specialized fuels. The Company's clients cover a variety of sectors, including commercial, local municipalities and the federal government. Founded in 1991 by Al Gonzalez, AGE is a family owned and operated business in the heart of the San Antonio community. Starting on a shoe-string budget and a bushel of determination, AGE is proud to have posted over 22% growth per year since 1991. The Company filed for Chapter 11 bankruptcy protection on February 8, 2010 (Bankr. W.D. Texas Case No. 10-50501). Aaron Michael Kaufman, Esq.; Carol E. Jendrzey, Esq.; and Mark E. 7Andrews, Esq., at Cox Smith Matthews Incorporated, assist the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. ALOHA SPORTS: Files for Bankruptcy Protection in Hawaii ------------------------------------------------------- Gene Park at Star Bulletin reports that Aloha Sports Inc., together with its parent company, ASI Acquisition, filed for Chapter 11 bankruptcy protection in Hawaii. Aloha Sports said it owes $266,674 to Mountain West Conference; $207,159, University of Oregon; $195,212, ABS Sports Inc.; and $166,869, Wake Forest University, report says. Don Gelber, Esq., represents the Company in its restructuring effort. ASI Acquisition operated the Aloha, Oahu and Hula football bowl games in Hawaii. The Aloha Bowl was part of the NCAA bowl season since 1982. The Hawaii bowl game ceased to operate in 2000 after dwindling attendance. The Oahu Bowl became the Seattle Bowl and was played in 2001 and 2002 but was not NCAA-certified in 2003. The Aloha Bowl moved to San Francisco but was never certified. AMBAC ASSURANCE: Moody's Places 'Caa2' IFSR on Review for Upgrade ----------------------------------------------------------------- Moody's Investors Service has lowered the rating of the senior unsecured debt of Ambac Financial Group Inc. to C from Ca, and placed the Caa2 insurance financial strength ratings of Ambac Assurance Corporation on review for possible upgrade. Moody's also placed the Caa2 IFSR for Ambac Assurance UK Limited (AUK) on review with direction uncertain. The rating actions may have implications for certain transactions wrapped by AAC and AUK as discussed later in this press release. Transaction Overview The rating action was prompted by Ambac's announced restructuring. AAC established a segregated account, containing AAC's most risky exposures such as RMBS and Las Vegas Monorail. The Office of the Commissioner of Insurance of the State of Wisconsin (OCI), Ambac's regulator, has placed the segregated account under rehabilitation. AAC also entered into a non-binding agreement to commute all of its remaining ABS CDOs. These actions are expected to improve the credit standing of AAC's senior unsecured policyholders by settling the insurer's most risky exposures, and effectively subordinating (via the segregated account) policyholders with outstanding claims. Moody's IFSR addresses senior policy obligations residing within AAC's general account, but not the now-subordinated segregated account claims. The segregated account is capitalized by a $2 billion secured note due 2050 issued by AAC, and an aggregate excess of loss reinsurance agreement provided by AAC. The secured note is collateralized by installment premiums, reinsurance premiums and certain recoveries related to the policies in the segregated account. All claims payments related to the segregated account will be suspended, until the Segregated Account Rehabilitation Plan is approved by the court. The OCI indicated that the process may take about six months. The rehabilitation plan calls for the future payment of claims out of the segregated account to be made with a combination of cash and surplus notes. Ambac also reached a non-binding agreement to settle ABS CDOs with counterparties. In exchange for the termination of the ABS CDO obligations, AAC would pay the counterparties $2.6 billion in cash, and $2 billion surplus notes issued by AAC. The surplus notes would have the same terms as the ones issued as part of the rehabilitation plan. Given the non-cash component of the payments and the size of the payments compared to likely losses that would have been sustained from these contracts, Moody's considers this transaction to represent a distressed exchange. Rationale For Ambac Assurance Corporation The review for upgrade of AAC's financial strength rating reflects the enhanced credit profile of general account policyholders following the group's restructuring. Policies allocated to the segregated account have been effectively subordinated to the policies remaining in the general account, said Moody's. The general account's insured book contains mainly less risky public finance securities, largely free of legacy risks, and appears to be well supported by the corresponding claims paying resources (such as loss reserves and unearned premiums) and surplus notes to fund future reinsurance claims. The surplus notes are subordinated to general account's insurance claims. Moody's said that the potential for upward rating movement is tempered, however, by charges related to potential lawsuits and AAC's inability to write new business before the full repayment of the surplus notes. During its review, Moody's will evaluate the full impact of the restructuring on AAC's financial strength, including the extent to which senior unsecured policyholders of the general account are truly insulated from segregated account losses. Moody's believes that policies allocated to the segregated account are no longer appropriately considered to be senior policyholder obligations of AAC and that, consequently, Moody's insurance financial strength rating for AAC would not apply to such exposures. Rationale for Ambac Assurance Uk Limited AUK has sent AAC notices of termination with respect to AUK's reinsurance agreement (from AAC), but per Ambac's Form 8-K filing, AAC does not believe that AUK has a right to terminate the agreement. AUK has demanded payment of unearned premium reserves, loss reserves, contingency reserves and loss adjustment expense reserves related to the reinsured policies, less ceding commissions and certain adjustments. Currently, the liabilities of AAC under the AUK reinsurance agreement have been allocated to the segregated account, and they are subject to the same payment terms as the other obligations under the segregated account. The review direction uncertain of AUK's Caa2 insurance financial strength rating reflects the potential for AUK's financial profile to either improve, if successful in its efforts to terminate the reinsurance agreement and obtain cash in lieu of previously ceded reserves. The rating may be lowered if such efforts are unsuccessful and its reinsurance protection becomes further subordinated to AAC's general account policyholder claims. Rationale for Ambac Financial Group, Inc The downgrade of Ambac Financial's senior debt rating to C, in Moody's opinion, reflects the heightened risk of default and very low ultimate recovery on the debt, whether through distressed exchange or potential bankruptcy proceedings, due to the holding company's modest cash position and limited financial flexibility. In Moody's view, it is unlikely that the holding company will be able to access operating company resources over a reasonable timeframe to satisfy its obligations. Treatment of Wrapped Transactions Moody's ratings on securities that are guaranteed or "wrapped" by a financial guarantor are generally maintained at a level equal to the higher of these: a) the rating of the guarantor (if rated at the investment grade level); or b) the published underlying rating (and for structured securities, the published or unpublished underlying rating). Moody's approach to rating wrapped transactions is outlined in Moody's special comment entitled "Assignment of Wrapped Ratings When Financial Guarantor Falls Below Investment Grade" (May, 2008); and Moody's November 10, 2008 announcement entitled "Moody's Modifies Approach to Rating Structured Finance Securities Wrapped by Financial Guarantors". In light of the rating actions, Moody's will position the ratings of wrapped transactions remaining in AAC's general account, and the ratings of transactions wrapped by AUK, according to these criteria. If the rating of AAC or AUK should subsequently move back into the investment grade range, or if the agency should subsequently publish the underlying rating, Moody's would reinstate the rating to the wrapped instruments. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to repay punctually senior policyholder claims and obligations and the rating agency believes that policies allocated to the segregated account are no longer senior obligations of Ambac Assurance Corporation. As a result, wrapped transactions allocated to the segregated account will be rated at the published underlying rating (and for structured securities, the published or unpublished underlying rating). List of Rating Actions These ratings actions have taken place: * Ambac Assurance Corporation -- insurance financial strength to Caa2 on review for upgrade, from Caa2; * Ambac Assurance UK Limited -- insurance financial strength to Caa2 on review with direction uncertain, from Caa2; * Ambac Financial Group, Inc. -- senior unsecured debt to C, from Ca. The last rating action related to Ambac was on July 29 , 2009, when Moody's downgraded Ambac's financial strength ratings to Caa2 and Ambac Financial's ratings (senior debt to Ca). Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. AMBAC FINANCIAL: Moody's Downgrades Senior Debt Rating to 'C' ------------------------------------------------------------- Moody's Investors Service has lowered the rating of the senior unsecured debt of Ambac Financial Group Inc. to C from Ca, and placed the Caa2 insurance financial strength ratings of Ambac Assurance Corporation on review for possible upgrade. Moody's also placed the Caa2 IFSR for Ambac Assurance UK Limited (AUK) on review with direction uncertain. The rating actions may have implications for certain transactions wrapped by AAC and AUK as discussed later in this press release. Transaction Overview The rating action was prompted by Ambac's announced restructuring. AAC established a segregated account, containing AAC's most risky exposures such as RMBS and Las Vegas Monorail. The Office of the Commissioner of Insurance of the State of Wisconsin (OCI), Ambac's regulator, has placed the segregated account under rehabilitation. AAC also entered into a non-binding agreement to commute all of its remaining ABS CDOs. These actions are expected to improve the credit standing of AAC's senior unsecured policyholders by settling the insurer's most risky exposures, and effectively subordinating (via the segregated account) policyholders with outstanding claims. Moody's IFSR addresses senior policy obligations residing within AAC's general account, but not the now-subordinated segregated account claims. The segregated account is capitalized by a $2 billion secured note due 2050 issued by AAC, and an aggregate excess of loss reinsurance agreement provided by AAC. The secured note is collateralized by installment premiums, reinsurance premiums and certain recoveries related to the policies in the segregated account. All claims payments related to the segregated account will be suspended, until the Segregated Account Rehabilitation Plan is approved by the court. The OCI indicated that the process may take about six months. The rehabilitation plan calls for the future payment of claims out of the segregated account to be made with a combination of cash and surplus notes. Ambac also reached a non-binding agreement to settle ABS CDOs with counterparties. In exchange for the termination of the ABS CDO obligations, AAC would pay the counterparties $2.6 billion in cash, and $2 billion surplus notes issued by AAC. The surplus notes would have the same terms as the ones issued as part of the rehabilitation plan. Given the non-cash component of the payments and the size of the payments compared to likely losses that would have been sustained from these contracts, Moody's considers this transaction to represent a distressed exchange. Rationale For Ambac Assurance Corporation The review for upgrade of AAC's financial strength rating reflects the enhanced credit profile of general account policyholders following the group's restructuring. Policies allocated to the segregated account have been effectively subordinated to the policies remaining in the general account, said Moody's. The general account's insured book contains mainly less risky public finance securities, largely free of legacy risks, and appears to be well supported by the corresponding claims paying resources (such as loss reserves and unearned premiums) and surplus notes to fund future reinsurance claims. The surplus notes are subordinated to general account's insurance claims. Moody's said that the potential for upward rating movement is tempered, however, by charges related to potential lawsuits and AAC's inability to write new business before the full repayment of the surplus notes. During its review, Moody's will evaluate the full impact of the restructuring on AAC's financial strength, including the extent to which senior unsecured policyholders of the general account are truly insulated from segregated account losses. Moody's believes that policies allocated to the segregated account are no longer appropriately considered to be senior policyholder obligations of AAC and that, consequently, Moody's insurance financial strength rating for AAC would not apply to such exposures. Rationale for Ambac Assurance Uk Limited AUK has sent AAC notices of termination with respect to AUK's reinsurance agreement (from AAC), but per Ambac's Form 8-K filing, AAC does not believe that AUK has a right to terminate the agreement. AUK has demanded payment of unearned premium reserves, loss reserves, contingency reserves and loss adjustment expense reserves related to the reinsured policies, less ceding commissions and certain adjustments. Currently, the liabilities of AAC under the AUK reinsurance agreement have been allocated to the segregated account, and they are subject to the same payment terms as the other obligations under the segregated account. The review direction uncertain of AUK's Caa2 insurance financial strength rating reflects the potential for AUK's financial profile to either improve, if successful in its efforts to terminate the reinsurance agreement and obtain cash in lieu of previously ceded reserves. The rating may be lowered if such efforts are unsuccessful and its reinsurance protection becomes further subordinated to AAC's general account policyholder claims. Rationale for Ambac Financial Group, Inc The downgrade of Ambac Financial's senior debt rating to C, in Moody's opinion, reflects the heightened risk of default and very low ultimate recovery on the debt, whether through distressed exchange or potential bankruptcy proceedings, due to the holding company's modest cash position and limited financial flexibility. In Moody's view, it is unlikely that the holding company will be able to access operating company resources over a reasonable timeframe to satisfy its obligations. Treatment of Wrapped Transactions Moody's ratings on securities that are guaranteed or "wrapped" by a financial guarantor are generally maintained at a level equal to the higher of these: a) the rating of the guarantor (if rated at the investment grade level); or b) the published underlying rating (and for structured securities, the published or unpublished underlying rating). Moody's approach to rating wrapped transactions is outlined in Moody's special comment entitled "Assignment of Wrapped Ratings When Financial Guarantor Falls Below Investment Grade" (May, 2008); and Moody's November 10, 2008 announcement entitled "Moody's Modifies Approach to Rating Structured Finance Securities Wrapped by Financial Guarantors". In light of the rating actions, Moody's will position the ratings of wrapped transactions remaining in AAC's general account, and the ratings of transactions wrapped by AUK, according to these criteria. If the rating of AAC or AUK should subsequently move back into the investment grade range, or if the agency should subsequently publish the underlying rating, Moody's would reinstate the rating to the wrapped instruments. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to repay punctually senior policyholder claims and obligations and the rating agency believes that policies allocated to the segregated account are no longer senior obligations of Ambac Assurance Corporation. As a result, wrapped transactions allocated to the segregated account will be rated at the published underlying rating (and for structured securities, the published or unpublished underlying rating). List of Rating Actions These ratings actions have taken place: * Ambac Assurance Corporation -- insurance financial strength to Caa2 on review for upgrade, from Caa2; * Ambac Assurance UK Limited -- insurance financial strength to Caa2 on review with direction uncertain, from Caa2; * Ambac Financial Group, Inc. -- senior unsecured debt to C, from Ca. The last rating action related to Ambac was on July 29 , 2009, when Moody's downgraded Ambac's financial strength ratings to Caa2 and Ambac Financial's ratings (senior debt to Ca). Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. ARES CAPITAL: Moody's Confirms 'Ba1' Rating with Stable Outlook --------------------------------------------------------------- Moody's Investors Service confirmed Ares Capital Corporation's Ba1 issuer rating. In a related action, Moody's upgraded Allied Capital Corporation's issuer and senior unsecured ratings to Ba1 from B1. All ratings have a stable outlook. This concludes the review of Ares and Allied begun on October 26, 2009, and continued on January 28, 2010. These rating actions follow Ares' and Allied's announcements that their shareholders have approved Ares' acquisition of Allied in an all stock transaction. The companies plan to close the transaction by April 1, 2010. Over the past several months both companies have taken actions to alleviate short term refinancing risk and reduce leverage -- two risks that Moody's had highlighted when it initiated the ratings review. As a result, Moody's expects the combined company will achieve its targeted debt to equity ratio of 0.65 times to 0.75 times (this is equivalent to an asset coverage ratio of approximately 230% to 250%) at closing. Allied has deleveraged substantially by selling investment portfolio assets and pre-paying debt. Allied reduced its debt by $815 million, or 45%, between June 30, 2009, and January 29, 2010, increasing asset coverage ratio above 200% (based on December 31, 2009 investment portfolio valuations). The company has prepaid all 2010 maturities. Ares, in two separate offerings, has raised $387 million of common equity. Also, Ares recently increased the capacity of its bank facilities to $1 billion on a stand-alone basis and extended their maturity to January 2013. The combination of these actions mitigate the concerns that Moody's had earlier expressed, and support the Ba1 rating outcome. Supporting the stable outlook is Moody's view that Allied's portfolio poses less risk of write-downs post closing. This is due to the fact that Allied's investment portfolio, although of extremely poor quality, has not deteriorated further in the past two quarters, was valued at 58% of cost at December 31, 2009, and it will likely be written-down further through purchase accounting. Also, Ares' investment portfolio has shown quality improvement over the past two quarters. Ares' rating could come under negative pressure if the company increases its leverage from current levels or if its investment portfolio displays significant deterioration from current levels. Positive pressure could result if Ares maintains an asset coverage ratio of 250% and reduces the encumbrance of its investment portfolio to less than 50%. The last rating action on Ares and Allied was on January 28, 2010, when Moody's continued the review for downgrade on Ares and the review for upgrade on Allied. Ares Capital Corporation is based in New York and reported total assets of $2.3 billion at December 31, 2009. Allied Capital Corporation is based in Washington DC and reported total assets of $2.7 billion at December 31, 2009. Upgrades: Issuer: Allied Capital Corporation -- Issuer Rating, Upgraded to Ba1 from B1 -- Senior Unsecured Regular Bond/Debenture, Upgraded to Ba1 from B1 Outlook Actions: Issuer: Allied Capital Corporation -- Outlook, Changed To Stable From Rating Under Review Issuer: Ares Capital Corporation -- Outlook, Changed To Stable From Rating Under Review Confirmations: Issuer: Ares Capital Corporation -- Issuer Rating, Confirmed at Ba1 AMERICAN RACING: Cancels Registration of Common Stock ----------------------------------------------------- American Racing Capital, Inc., filed with the Securities and Exchange Commission a Form 15-12G to terminate the registration of its common stock. American Racing Capital's last filing with the SEC was on July 1, 2008 -- an amendment to the Company's report for the Quarterly Period Ended March 31, 2008. At March 31, 2008, the Company had total assets of $1,824,698 against total liabilities, all current, of $2,253,232, resulting in stockholders' deficit of $1,231,836. Las Vegas, Nevada-based Moore & Associates, Chartered, said in its June 24, 2008 report that there is substantial doubt about the Company's ability to continue as a going concern. The Company has acknowledged the auditor's adverse opinion and indicated in its March 2008 report that "In order to continue as a going concern and achieve a profitable level of operations, the Company will need, among other things, to raise additional capital resources and to develop a consistent source of revenues. Management's plans include raising additional operating funds from private placements of shares of its common stock." The Company had said its plan of operations seeks to integrate race track design and development operations with a professional racing team and a national driving school network to leverage the popularity and growth of the motor sports industry. In the March 2008 report, the Company said that, for the next 12 months, it anticipates that it will need $2,500,000 for general working capital purposes, including funds for event and administrative operations, in addition to funding necessary to acquire and develop race track projects. The Company said it would seek debt financing to launch any new race track projects and will seek equity funding or a combination of debt/equity financing for operations. AUGUSTA APARTMENTS: Has Access to Cash Collateral Until April 26 ---------------------------------------------------------------- The Hon. Patrick M. Flatley of the U.S. Bankruptcy Court for the Northern District of West Virginia, in a second interim order, authorized Augusta Apartments, LLP, to use the cash collateral of PNC Bank, National Association until April 26, 2010 A further hearing on the Debtor's continued use of cash collateral is scheduled for April 26, 2010. The Debtor would use the money to fund its Chapter 11 case, pay suppliers and other parties. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant PNC (a) replacement security interests and liens in and on all of the Debtor's assets, subject to the carve out; (b) superpriority administrative claim status; and (c) adequate protection payments. The Debtor will also pay all insurance premiums necessary to maintain adequate insurance coverage on all of Debtor's assets and will pay all withholding taxes and all other taxes assessed against the Debtor as and when due. The Debtor is represented by: Robert O. Lampl, Esq. 960 Penn Avenue, Suite 1200 Pittsburgh, PA 15222 Fax: (412) 392-0330 Email: rol@lampllaw.com About Augusta Apartments Morgantown, West Virginia-based Augusta Apartments, LLC, filed for Chapter 11 bankruptcy protection on February 19, 2010 (Bankr. N.D. W.Va. Case No. 10-00303). The Company estimated its assets and debts at $10,000,001 to $50,000,000. AUGUSTA APARTMENTS: U.S. Trustee Unable to Form Creditors Panel --------------------------------------------------------------- The Office of the U.S. Trustee for Region 4 notified the U.S. Bankruptcy Court for the Northern District of West Virginia that it was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of Augusta Apartments, LLP. The U.S. Trustee said that there were insufficient indications of willingness from the unsecured creditors to serve on the Committee. Morgantown, West Virginia-based Augusta Apartments, LLC, filed for Chapter 11 bankruptcy protection on February 19, 2010 (Bankr. N.D. W.Va. Case No. 10-00303). Robert O. Lampl, Esq., at Robert O Lampl Law Office, assists the Company in its restructuring efforts. The Company estimated its assets and debts at $10,000,001 to $50,000,000 as of the Petition Date. AUGUSTA APARTMENTS: Files List of Largest Unsecured Creditors ------------------------------------------------------------- Augusta Apartments, LLP, filed with the U.S. Bankruptcy Court for the Northern District of West Virginia a list of its largest unsecured creditors. A full-text copy of the list is available for free at: http://bankrupt.com/misc/AugustaApartments_listofunseccreditors.pdf Morgantown, West Virginia-based Augusta Apartments, LLC, filed for Chapter 11 bankruptcy protection on February 19, 2010 (Bankr. N.D. W.Va. Case No. 10-00303). Robert O. Lampl, Esq., at Robert O Lampl Law Office, assists the Company in its restructuring efforts. The Company estimated its assets and debts at $10,000,001 to $50,000,000. BIGLER LP: Plan Uncertain If Able to Pay Unsecured Creditors ------------------------------------------------------------ Bigler LP filed with the U.S. Bankruptcy Court for the Southern District of Texas a Disclosure Statement explaining its Plan of Liquidation. The Debtor will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the Plan constitutes a single plan of liquidation for all Debtors. Upon the effective date, all assets not subject to the sale will be transferred to a liquidating trust. The liquidating trust will administered by the liquidating trustee, will be making the distribution provided by the Plan. With the assistance of their financial advisor, Parkman Whaling, LLC, the Debtors marketed the sale of substantially all of their assets, consistent with the terms of their DIP loan with Amegy Bank. The Plan contemplates making payments to allowed claims pursuant to priorities set forth in the Plan, to the extent that any trust assets remain. It is uncertain what unsecured creditors will receive, if anything, after the proposed sale, and the liquidating trust's review, initiation, and prosecution of causes of action. Under the Plan, all cash necessary for the liquidating trust to make distributions pursuant to the Plan will be obtained from the trust assets, including the sale proceeds. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/BiglerLP_DS.pdf The Debtor is represented by: Henry J. Kaim Mark W. Wege Edward L. Ripley King & Spalding LLP 1100 Louisiana, Suite 4000 Houston, TX 77002 About Bigler LP Houston-based Bigler LP is a diversified petrochemical producer. Bigler has production and storage facilities on 271 acres on the Houston Ship Channel. Bigler filed for Chapter 11 reorganization on Oct. 30 in Houston (Bankr S.D. Tex. Case No. 09-38188). The petition listed assets of $233 million against debt totaling $151 million. Liabilities include $67 million owed to secured lender Amegy Bank NA, which has a lien on all assets. Secured lender Amegy Bank is represented by Porter & Hedges LLP. BIO-KEY INTERNATIONAL: Reports $4.7 Million Net Income in 2009 -------------------------------------------------------------- BIO-key International, Inc., filed its annual report on Form 10-K, showing net income of $4.7 million on $2.4 million of revenue for 2009, compared to net income of $119,179 on $3.4 million of revenue for 2008. Operating loss was $2.5 million in 2009, compared to an operating loss of $1.7 million in 2008. The significant increase in year over year net income is attributable to a $4.5 million gain, net of expected tax, on disposal of the Law Enforcement Division. The Company's balance sheet as of December 31, 2009, showed $6.1 million in assets, $2.4 million of debts, $2.6 million of preferred stock, and $1.1 million of stockholders' equity. CCR LLP, in Westborough, Mass., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of the Company's substantial net losses in recent years and accumulated deficit at December 31, 2009. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c92 Wall, N.J.-based BIO-key International, Inc. (OTC BB: BKYI) -- http://www.bio-key.com/-- develops and markets advanced fingerprint identification biometric technology and software solutions. BIOVEST INT'L: Laurus Master Fund Holds 9.99% of Shares ------------------------------------------------------- Russell Smith, the Joint Official Liquidator for the account of Laurus Master Fund, Ltd., disclosed that as of December 31, 2009, the fund may be deemed to beneficially own 10,826,822 shares or roughly 9.99% of the Common Stock of Biovest International, Inc. The shares are also deemed held by PSource Structured Debt Limited, Laurus Capital Management, LLC, Valens U.S. SPV I, LLC, Valens Offshore SPV I, Ltd., Valens Capital Management, LLC, Chris Johnson, Russell Smith, Eugene Grin and David Grin. Chris Johnson, Russell Smith, Eugene Grin and David Grin are affiliated with Johnson Smith Associates Ltd. in Grand Cayman, Cayman Islands. Based in Tampa, Florida, Biovest International Inc. (Other OTC: BVTI) -- http://www.biovest.com/-- is a pioneer in the development of advanced individualized immunotherapies for life- threatening cancers of the blood system. Biovest is a majority- owned subsidiary of Accentia Biopharmaceuticals Inc., with its remaining shares publicly traded. Biovest filed for Chapter 11 bankruptcy protection on November 10, 2008 (Bankr. M.D. Fla. Case No. 08-17796). BLOCKBUSTER INC: OKs Slate of Director Nominees for Submission -------------------------------------------------------------- Blockbuster Inc. provided information regarding its upcoming annual stockholders' meeting, which is scheduled to be held in Dallas, Texas, on Wednesday, May 26, 2010, at 10 a.m. Central Time. The Blockbuster Board of Directors has approved a slate of director nominees for submission to the Company's stockholders at its 2010 annual meeting. The nominees include existing directors: Edward Bleier, James W. Crystal, Gary Fernandes, Jules Haimovitz, James W. Keyes and Strauss Zelnick as well as new nominee Joseph J. Fitzsimmons. Director Robert Bowman notified the Company he will not stand for reelection at the annual stockholders' meeting. Bowman, who, in addition to being Chief Executive Officer of MLB.com, serves as a director on several boards, cited other commitments as the reason for his decision not to stand for reelection. "We believe the nominees approved by the Board of Directors will provide Blockbuster with the continuity and expertise necessary to continue our transformation into a multi-channel provider of media entertainment," stated Jim Keyes, Chairman and Chief Executive Officer of Blockbuster Inc. "On behalf of Blockbuster's key stakeholders, I want to thank Bob for his service and many significant contributions to the Company's Board. Bob's leadership and focus on Blockbuster's long-term opportunities have played an integral role in the Company's transformation. We wish him continued success." Blockbuster's annual stockholders' meeting will take place at Renaissance Tower, 1201 Elm Street 42nd floor. Items to be voted upon at the meeting include the following: * Election of the 2010 slate of Directors; * Ratification of the appointment of PriceWaterhouseCoopers LLC to serve as independent accountants for fiscal 2010; * Combination of Class A common stock and Class B common stock into a single class, and approval to execute a reverse stock split. The Company also reported that it has been notified by the New York Stock Exchange that its average global market capitalization had fallen below $75 million over a 30 trading-day period. Under applicable NYSE rules, the Company has 45 calendar days to submit a plan to the NYSE that demonstrates its ability to achieve compliance with the continued listing standards within 18 months. Keyes concluded, "We intend to promptly submit a plan to the NYSE, which will outline the proactive steps we plan to take to remedy the Company's non-compliance by September of 2011." Stockholders will be able to review detailed biographies of all the Blockbuster Board of Director nominees and other information pertaining to its 2010 annual stockholders' meeting and proposals within the Company's proxy statement, which is expected to be filed with the U.S. Securities and Exchange Commission ("SEC") on or about April 16, 2010. Upon filing with the SEC, the Company's Definitive Proxy Statement on Form 14-A will be available, free of charge, at either http://www.sec.govor http://investor.blockbuster.com. About Blockbuster Inc. Dallas-Tex.-based Blockbuster Inc. is a leading global provider of rental and retail movie and game entertainment, with over 6,500 stores in the United States, its territories and 17 other countries as of January 3, 2010. * * * As reported in the Troubled Company Reporter on March 22, 2010, Standard & Poor's Ratings Services lowered its corporate credit rating on Dallas-based Blockbuster Inc. to 'CC' from 'CCC'. The 'CC' rating indicates that, in S&P's opinion, Blockbuster is highly vulnerable to default. The outlook is negative. BLUE HERON: Gets Final OK to Access Wells Fargo's Cash Collateral ----------------------------------------------------------------- The Hon. Randall L. Dunn of the of the U.S. Bankruptcy Court for the District of Oregon, in a final order, authorized Blue Heron Paper Company to use Wells Fargo Bank, National Association's cash collateral. The Debtor would use the cash for the maintenance and preservation of its property for the benefit of all creditors, for the operation of its business, and for payment of the expenses attendant thereto. The authority of the Debtor to use cash collateral will terminate at 11:59 p.m., Portland time, on December 31, 2010, or upon the occurrence of a termination event. As reported in the Troubled Company Reporter on January 14, 2010, the Debtor owed Wells Fargo $14.54 million pursuant to the terms of a Credit and Security Agreement dated as of December 30, 2003, as amended. The debt consists of $12.2 million of revolving credit advances and $2.325 million of unamortized principal under a machinery and equipment note, plus fees, costs and interest. The Debtor said that the use of cash collateral will not harm its primary lender, Wells Fargo, because (i) the Bank is protected by a generous equity cushion and (ii) if for any reason Blue Heron cannot reorganize, its use of cash collateral will result in a large net increase in the liquidation value of the Bank's other collateral. The Debtor will provide further adequate protection to the Bank in the form of a replacement lien on postpetition inventory and accounts. The Debtor said that the Bank is the only party with an interest in the estate's cash. The Debtor is represented by: Robert J. Vanden Bos Vanden Bos & Chapman, LLP 319 SW Washington Street, Suite 520 Portland, OR 97204 Tel: (503) 241-4869 Fax: (503) 241-3731 Email: bob@vbcattorneys.com About Blue Heron Oregon City, Oregon-based Blue Heron Paper Company filed for Chapter 11 bankruptcy protection on December 31, 2009 (Bankr. D. Ore. Case No. 09-40921). The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. BLUE HERON: Creditors Have Until May 3 to File Proofs of Claim -------------------------------------------------------------- The Hon. Randall L. Dunn of the U.S. Bankruptcy Court for the District of Oregon has established May 3, 2010, as the deadline for any individual or entity to file proofs of claim against Blue Heron Paper Company. Proofs of claim must be filed with Clerk of the Bankruptcy Court, 1001 SW 5th Ave. No. 700, Portland, Oregon. Claimants must serve a copy of the claim to (a) the Debtor's counsel, Brandy A. Sargent, Stoel Rives LLP, 900 SW Fifth Ave., Suite 2600, Portland, Oregon; and (b) counsel for the Creditors Committee, Marc L. Barreca, K&L Gates, 925 Fourth Ave., Suite 2900, Seattle, Washington. Oregon City, Oregon-based Blue Heron Paper Company filed for Chapter 11 bankruptcy protection on December 31, 2009 (Bankr. D. Ore. Case No. 09-40921). The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. BOSQUE POWER: Moody's Withdraws 'Caa2' Rating on Senior Loan ------------------------------------------------------------ Moody's Investors Service has withdrawn the rating on Bosque Power Company, LLC's senior secured credit facilities. The rating has been withdrawn because the issuer has entered bankruptcy and Moody's believes it lacks adequate information to assess expected recovery value and to maintain a rating. The last rating action on the company was on January 22, 2010, when it was downgraded to Caa2. 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 facility consists of two combined cycle gas turbines with an aggregate generating capacity of approximately 800 MW. 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. Until recently, Fulcrum also served as asset and energy manager for the project, roles that are now being fulfilled by PurEnergy Management Services, LLC, a specialist in distressed energy asset services and project workouts headquartered in Syracuse, NY. BOSQUE POWER: S&P Drops Sr. Debt Rating to 'D' on Ch. 11 Filing --------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its rating on U.S. electricity generator Bosque Power Co. LLC's senior debt to 'D' from 'B'. Bosque filed for bankruptcy on March 24, 2010, in the U.S. Bankruptcy Court of the Western district of Texas. On Jan. 16, 2008, the project issued $412.5 million (about $400 million outstanding) of senior secured debt facilities. The facilities consist of a five-year, $25 million senior secured revolving credit facility due January 2013 and a seven-year, $387.5 million senior secured term facility due January 2015. The term facility includes $203 million for construction-related expenses and $65 million to cash-collateralize letters of credit Bosque uses to secure its commitments under gas contracts. The '3' recovery rating on the debt indicates S&P's expectation of meaningful (50% to 70%) recovery of principal in a default scenario. The project issued the debt in 2008 in part to fund the conversion of Units 1 and 2 into a single combined-cycle unit. Construction delays caused Bosque to postpone the planned completion date of this unit to about October 2009 from May 2009. A third combined- cycle unit continued to operate during construction. "On Jan. 22, 2010, S&P placed the rating on CreditWatch with negative implications after the project failed to enter into a long-term hedge agreement by Jan. 16, 2010, as required by its Jan. 16, 2008 senior credit agreement," said Standard & Poor's credit analyst Matthew Hobby. The long-term hedge agreement had to result in pro forma projections that complied with financial covenants, including 6x leverage and 1.4x interest coverage, beginning in late 2010. The leverage ratio at Sept. 30, 2009 was 18x. Under the credit agreement, if the project did not comply with the covenant to enter into the hedge agreement within 30 days (or 90 days if it was working diligently to comply) then the failure would become an event of default. Remedies following such an event of default included acceleration of all or a portion of the debt, at the discretion of the holders of more than 50% of the senior debt. BRENTWOOD APARTMENTS: Has Until May 10 to Propose Chapter 11 Plan ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida directed Brentwood Apartments Tampa, LLC, to file a Chapter 11 Plan & Disclosure Statement by May 10, 2010. Tampa, Florida-based Brentwood Apartments Tampa, LLC, aka Brentwood Apartments, filed for Chapter 11 bankruptcy protection on February 17, 2010 (Bankr. M.D. Fla. Case No. 10-03334). Scott A. Stichter, Esq., at Stichter, Riedel, Blain & Prosser, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. The Debtor's affiliates -- Brookside Tampa, LLC; Palma Ceia Apartments, LLC; River Park Naples Limited Partnership; and The RSG Family Limited Partnership-Gordon River -- filed separate Chapter 11 petition December 15, 2009. BRENTWOOD APARTMENTS: Taps Stichter Riedel as Bankruptcy Counsel ---------------------------------------------------------------- Brentwood Apartments Tampa, LLC, asks the U.S. Bankruptcy Court for the Middle District of Florida for permission to employ Stichter, Riedel, Blain & Prosser as counsel. Stichter Riedel will, among other things: a. render legal advice with respect to the Debtor's powers and duties as a debtor-in-possession, the continued operation of the Debtor's business, and the management of its property; b. prepare on behalf of the Debtor necessary motions, applications, orders, reports, pleadings, and other legal papers; and c. appear before the Bankruptcy Court, any appellate courts, and the U.S. Trustee to represent and protect the interests of the Debtor. The Debtor will compensate Stichter Riedel on an hourly basis in accordance with Stichter Riedel's ordinary and customary rates. The court document did not disclose the hourly rates of Stichter Riedel's pesonnel. To the best of the Debtor's knowledge, Stichter Riedel is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Stichter, Riedel, Blain & Prosser 110 E. Madison Street, Suite 200 Tampa, FL 33602-4700 Tel: (813) 229-0144 Fax: (813) 229-1811 E-mail: sstichter.ecf@srbp.com About Brentwood Apartments Tampa, Florida-based Brentwood Apartments Tampa, LLC, aka Brentwood Apartments, filed for Chapter 11 bankruptcy protection on February 17, 2010 (Bankr. M.D. Fla. Case No. 10-03334). The Company estimated its assets and debts at $10,000,001 to $50,000,000. The Debtor's affiliates -- Brookside Tampa, LLC; Palma Ceia Apartments, LLC; River Park Naples Limited Partnership; and The RSG Family Limited Partnership-Gordon River -- filed separate Chapter 11 petition December 15, 2009. BRENTWOOD APARTMENTS: Files Schedules of Assets and Liabilities --------------------------------------------------------------- Brentwood Apartments Tampa, LLC, filed with the U.S. Bankruptcy Court for the Middle District of Florida its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $7,147,300 B. Personal Property $207,679 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $9,707,331 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $658,367 ----------- ----------- TOTAL $7,354,979 $10,365,698 Tampa, Florida-based Brentwood Apartments Tampa, LLC, aka Brentwood Apartments, filed for Chapter 11 bankruptcy protection on February 17, 2010 (Bankr. M.D. Fla. Case No. 10-03334). Scott A. Stichter, Esq., at Stichter, Riedel, Blain & Prosser, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. The Debtor's affiliates -- Brookside Tampa, LLC; Palma Ceia Apartments, LLC; River Park Naples Limited Partnership; and The RSG Family Limited Partnership-Gordon River -- filed separate Chapter 11 petition December 15, 2009. BROSSIER CO: Files for Chapter 11 Bankruptcy to Avert Foreclosure ----------------------------------------------------------------- Anjali Fluker, staff writer at Business Journal of Orlando, reports that Brossier Co. LLC filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York. Brossier sought bankruptcy protection to avert a foreclosure sale sought by mortgage holder Mercantile Bank, which is owed $8.2 million. The Company said it is required to file a statement of financial affairs and list of 20 largest unsecured creditors by April 9, 2010, and plan of reorganization by July 26, 2010, report says. Attorneys at Rosenberg, Musso & Weiner LLP represent the Company in its restructuring effort. Brossier Co. is a property developer. BUFFET INC: Moody's Affirms 'Caa1' Corporate Family Rating ---------------------------------------------------------- Moody's Investors Service assigned a B3 rating to Buffet, Inc.'s proposed $250 million first lien term loan due 2015. In addition, Moody's affirmed the company's Caa1 Corporate Family Rating and Caa1 Probability of Default Rating. The outlook is changed to negative from stable. Proceeds from the new term loan will be used to re-finance Buffet's existing $117.5 million ($75 million outstanding) senior secured 1st lien term loan and $180 million ($163 million outstanding) senior secured 2nd lien term loan. As is customary, ratings are subject to receipt of final documentation. "The affirmation of Buffet's Caa1 Corporate Family Rating reflects the company's high leverage and weak interest coverage and the lack of an alternate source of liquidity." stated Bill Fahy, Senior Analyst. "The ratings also acknowledge Buffet's continuing poor operating performance as well as weak consumer demand trends in the casual dining segment that will continue to pressure Buffet's earnings and cash flow" stated Fahy. The negative outlook reflects Moody's view that weak consumer spending trends will continue to pressure Buffet's operating performance, which could cause debt protection metrics to remain weak for an extended period and as a result be inconsistent with its current ratings. New rating assigned: -- $250 million senior secured 1st lien term loan due 2015 rated B3 (LGD 3, 35%) Current ratings affirmed are; -- Corporate Family Rating of Caa1 -- Probability of Default Rating of Caa1 -- $120 million senior secured 1st lien term loan due 2012, rated B1 (LGD 2, 15%) The last rating action on Buffets, Inc, occurred on April 3, 2009, when Moody's assigned a Caa1 CFR and PDR and a stable outlook. Buffet, Inc., owns, operates, and franchises buffet style family restaurants. Annual revenues are approximately $1.3 billion. CALVIN WHITE: Committee Taps Southwell & O'Rourke as Counsel ------------------------------------------------------------ The Official Committee of Unsecured Creditors in the Chapter 11 case of Calvin G. White and Janae B. White asks the U.S. Bankruptcy Court for the Eastern District of Washington for permission to employ Southwell & O'Rourke, P.S. as its counsel. Southwell & O'Rourke will provide legal advice to the Committee relating to its rights and duties in the Chapter 11 proceedings. The Committee relates that Dan O'Rourke will be paid $325 per hour and Kevin O'Rourke will be paid $250 per hour, plus actual expenses incurred. These amounts will be paid by the Chapter 11 estate. To the best of the Committee's knowledge, Southwell & O'Rourke is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Southwell & O'Rourke, P.S. Suite 960, Paulsen Center West 421 Riverside avenue Spokane, WA 99201 Tel: (509) 624-0159 Wenatchee, Washington-based Calvin G. White filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. E.D. Wash. Case No. 10-00453). Allan L. Galbraith, Esq., at Davis Arneil Law Firm LLP, assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. CALVIN WHITE: U.S. Trustee Appoints 3-Member Creditors Committee ---------------------------------------------------------------- Robert D. Miller, Jr., Acting United States Trustee for Region 18, appointed three members to the official committee of unsecured creditors in the Chapter 11 case of Calvin G. White and Janae B. White. The Creditors Committee members are: 1. Numerica Credit Union Attn: Scott Walker P.O. Box 4000 Spokane Valley, WA 99037 Tel: (509) 343-7862 2. James M. Coley 7704 N. Bruce Rd. Spokane, WA 99217 Tel: (509) 434-9837 3. Diane Pooley 3666 Scotch Pine Lane No. 2 Coeur d'Alene, ID 83815 Tel: (208) 666-9461 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. Wenatchee, Washington-based Calvin G. White filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. E.D. Wash. Case No. 10-00453). Allan L. Galbraith, Esq., at Davis Arneil Law Firm LLP, assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. CALVIN WHITE: Files Schedules of Assets and Liabilities ------------------------------------------------------- Calvin G. White and Janae B. White filed with the U.S. Bankruptcy Court for the Eastern District of Washington its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $639,479 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $4,000 E. Creditors Holding Unsecured Priority Claims $859,000 F. Creditors Holding Unsecured Non-priority Claims $1,356,611 ----------- ----------- TOTAL $639,479 $2,219,611 Wenatchee, Washington-based Calvin G. White filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. E.D. Wash. Case No. 10-00453). Allan L. Galbraith, Esq., at Davis Arneil Law Firm LLP, assists the Company in its restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. CAMP COOLEY: Has Until April 8 to Propose Reorganization Plan ------------------------------------------------------------- The Hon. Ronald B. King of the U.S. Bankruptcy Court for the Western District of Texas extended Camp Cooley Ltd.'s exclusive period to file a Disclosure Statement and Plan of Reorganization until April 8, 2010. The Debtor is represented by: R. Glen Ayers, Jr. Langley & Banack, Inc. 745 E. Mulberry, Suite 900 San Antonio, TX 78212 Tel: (210) 736-6600 Fax: (210) 735-6889 Franklin, Texas-based Camp Cooley Ltd. operates an agricultural and farming business. The Company filed for Chapter 11 bankruptcy protection on November 8, 2009 (Bankr. W.D. Tex. Case No. 09- 61311). R. Glen Ayers Jr., Esq., at Langley and Banack, Inc., assists the Company in its restructuring effort. The Company listed $50,000,001 to $100,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. CAROLINA CARGO: Returns to Chapter 11 ------------------------------------- Bill Rochelle at Bloomberg News reports that Carolina Cargo Inc. of Rock Hill filed for Chapter 11 on March 23 in Spartanburg, South Carolina (Bankr. D. S.C. Case No. 10-02054). The Company blamed the filing on the recession and the ensuing decline in revenue. The Company disclosed assets and liabilities of $4.18 million and $11 million respectively. Secured debt aggregates $8.9 million. Carolina Cargo Inc. is a coast-to-coast trucking company. It filed its first Chapter 11 petition in May 2007 (Bankr. D. S.C. Case No. 07-02797) and confirmed a reorganization plan in June 2008. CENTRAL PARKING: Moody's Downgrades Corp. Family Rating to 'B3' --------------------------------------------------------------- Moody's Investors Service downgraded to B3 from B2 the Corporate Family Rating, Probability of Default Rating, and second lien term loan rating of Central Parking Corporation. Concurrently, the first lien credit facility rating was lowered to Ba3 from Ba2 and the ratings outlook was changed to negative from stable. This rating action reflects revenue and operating results that continue to trend below expectations, largely a result of the negative impact that high unemployment rates have on the demand for parking. Moody's does not expect unemployment in the US to rebound materially over the medium term, and cost cutting and operational initiatives undertaken by management have only partly offset negative 'same store' volume trends in CPC's leased properties. On a Moody's lease-adjusted basis, financial leverage was about 6 times at December 31, 2009 and is expected to remain near this level over the medium term. Nonetheless, the B3 rating is supported by the relative stability of CPC's managed property contracts, which represent a substantial portion of consolidated earnings, and about $80 million of permanent debt reduction since the 2007 leveraged buyout. Additionally, CPC's liquidity profile has improved subsequent to a covenant amendment obtained in December 2009 and Moody's expects liquidity to remain adequate over the near term. The B3 rating and negative outlook further reflect uncertainty regarding the refinancing of an unrestricted subsidiary's debt due on June 1, 2010. PropCo is a special purpose entity and CPC's debt contains no cross-default provisions in the event of a PropCo default. However, CPC maintains certain risks related to PropCo, including potential tax and legal risks. PropCo has the option to extend the maturity of its debt for up to two years if certain tests are met; additionally, reported property values are well in excess of the subsidiary's debt. Nonetheless, the commercial real estate market remains weak and PropCo's debt may need to be refinanced or extended even further than current provisions allow. Moody's downgraded these ratings: * $60 million (previously $80 million) first lien revolving credit facility due May 2013, to Ba3 (LGD2/16%) from Ba2 (LGD2/ 20%) * $152 million (previously $235 million) first lien term loan due May 2014, to Ba3 (LGD2/16%) from Ba2 (LGD2/ 20%) * $55 million first lien synthetic letter of credit facility due May 2014, to Ba3 (LGD2/16%) from Ba2 (LGD2/ 20%) * $50 million second lien term loan due November 2014, to B3 (LGD3/46%) from B2 (LGD4/53%) * Corporate Family Rating, to B3 from B2 * Probability of Default Rating, to B3 from B2 The previous rating action by Moody's on CPC occurred on May 24, 2007, when, upon close of the proposed leveraged buyout, Moody's converted provisional ratings to definitive ratings. Central Parking Corporation, headquartered in Nashville, Tennessee, is a leading provider of parking management. Reported revenues for the twelve month period ended December 31, 2009, excluding certain reimbursed contract expenses, were about $500 million. CHAPARRAL ENERGY: CCMP to Invest $345-Mil. to Buy Stake ------------------------------------------------------- Chaparral Energy Inc. entered into a definitive agreement under which CCMP will invest $345 million to acquire a significant ownership stake in the Company. Since its inception in 1988, Chaparral has increased reserves and production by acquiring and enhancing properties in its core areas of the Mid-Continent and the Permian Basin. Beginning in 2000, the Company expanded its geographic focus to include Ark-La-Tex, North Texas, the Gulf Coast and the Rocky Mountains. Chaparral is a growing energy company known for its expertise in conventional, unconventional, and enhanced oil recovery projects in the Mid- Continent and Permian Basin. "We are extremely pleased to be partnering with CCMP," said Mark Fischer, Chairman and CEO of Chaparral. "With its extensive experience investing in leading energy companies, we believe CCMP is the ideal partner to take us to the next level. CCMP's exceptional operating resources will allow us to sustain our growth through a balanced program of acquisitions, exploitation, development and exploration." Christopher Behrens, Managing Director of CCMP, said, "We are excited to have the opportunity to partner with an outstanding management team with a proven track record of success. Chaparral has a solid core asset base in regions with attractive unit economics." Karl Kurz, Managing Director of CCMP, said, "Chaparral has a successful operating model and Mark Fischer has built a solid platform that we believe will enable the Company to execute on a number of available growth opportunities." CCMP's founders have invested in energy companies since 1990. Selected energy investments include Bear Paw Energy, Bill Barrett Corporation, Brand Energy and Infrastructure Services, Carrizo Oil and Gas, Encore Acquisition Company, Latigo Petroleum, Patina Oil and Gas, and Vetco International. Chaparral's financial advisors were Capital One Southcoast and Morgan Stanley. Legal counsel to Chaparral was McAfee & Taft. CCMP's financial advisor was RBC Richardson Barr and legal advisor was Latham & Watkins. A full-text copy of the company's stock purchase agreement is available for free at http://ResearchArchives.com/t/s?5c8a Oklahoma City, Oklahoma-based Chaparral Energy, Inc. is an independent oil and natural gas company engaged in the production, acquisition and exploitation of oil and natural gas properties. Its areas of operation include the Mid-Continent, Permian Basin, Gulf Coast, Ark-La-Tex, North Texas and the Rocky Mountains. The company -- http://www.chaparralenergy.com/-- maintains a portfolio of proved reserves, development and exploratory drilling opportunities, and enhanced oil recovery (EOR) projects. As of Dec. 31, 2007, Chaparral had estimated proved reserves of 987 billion cubic feet of natural gas equivalent (Bcfe). Its reserves were 65% proved developed and 60% crude oil. The company also had an average daily production of 111.3 million cubic feet of natural gas equivalent (MMcfe) during the year. * * * According to the Troubled Company Reporter on Feb. 23, 2010, Standard & Poor's Ratings Services revised its CreditWatch implications to developing from positive on Oklahoma City-based independent exploration and production firm Chaparral Energy Inc. The ratings were initially placed on CreditWatch on Feb. 9, 2010. The CreditWatch revisions reflects the withdrawal of Chaparral's $400 million note offering, and the significant impact to liquidity if the company does not find a new credit facility and/or source of financing in the very near term. CIMINO BROKERAGE: Can Access Temple-Inland's Cash Until April 16 ---------------------------------------------------------------- The Hon. Arthur S. Weissbrodt of the U.S. Bankruptcy Court for the Northern District of California authorized Cimino Brokerage Company to use Temple-Inland, Inc.'s cash collateral until April 16, 2010. A further hearing to consider extended use of cash collateral, as well as the Chapter 11 Status Conference, will be held on April 2, 2010 at 2:00 p.m. The Debtor would use the money to fund its Chapter 11 case and pay suppliers and other parties. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the TIN a replacement lien on postpetition assets derived. The replacement lien will be subordinate to the (i) compensation and expense reimbursement allowed to a trustee in any successor Chapter 7 case; and (ii) fees payable to the U.S. Trustee. The Debtor is represented by: David B. Golubchik Todd M. Arnold Levene, Neale, Bender, Rankin & Brill L.L.P. 10250 Constellation Blvd., Suite 1700 Los Angeles, California 90067 Telephone: (310) 229-1234 Facsimile: (310) 229-1244 About Cimino Brokerage Salinas, California-based Cimino Brokerage Company, a California general partnership -- aka Cimino Brothers Produce and dba Cimino Brothers Produce -- was founded over 15 years ago by the Cimino family, which has been in the agricultural business since 1895. The Debtor is currently owned 50% by Vincent Cimino, 25% by Armand Cimino and 25% by Stephanie Cimino. The Company is a year-round grower, shipper and distributor of fresh vegetables and fruits, primarily broccoli. The Company, through its Mexican wholly-owned subsidiary (Cimino Brothers Produce Mexico S.A. de C.V. is the creator of the Asian Cut Crown broccoli category, and has developed the largest national network of Asian foodservice distributors and customers in the nation. The Company's administrative operations are carried out from its facilities in Salinas, California. The Company's primary cooling facilities in the United States are located in Laredo, Texas. The Company filed for Chapter 11 bankruptcy protection on November 24, 2009 (Bankr. N.D. Calif. Case No. 09-60291). The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. CITIGROUP INC: Treasury to Unload All Common Shares This Year ------------------------------------------------------------- The U.S. Department of the Treasury on Monday said it will fully dispose of its approximately 7.7 billion shares of Citigroup, Inc. common stock over the course of 2010 subject to market conditions. Treasury received the shares of common stock pursuant to the June 2009 Exchange Agreement between Treasury and Citigroup, which provided for the exchange into common shares of the preferred stock that Treasury purchased in connection with Citigroup's participation in the Capital Purchase Program. Treasury has engaged Morgan Stanley as its capital markets advisor in connection with its Citigroup position. According to various reports, the U.S. government owns about 27% of Citigroup, a stake it acquired after propping the lender up under the Troubled Asset Relief Program, and then converting its preferred stock into common shares last summer. Treasury intends to sell its Citigroup common shares into the market through various means in an orderly and measured fashion. Treasury intends to initiate its disposition of the common shares pursuant to a pre-arranged written trading plan. The manner, amount and timing of the sales under the plan is dependent upon a number of factors. This disposition does not affect Treasury's holdings of Citigroup trust preferred securities or warrants for its common stock. About Citigroup Based in New York, Citigroup Inc. (NYSE: C) -- is a global diversified financial services holding company whose businesses provide a broad range of financial services to consumer and corporate customers. Citigroup has roughly 200 million customer accounts and does business in more than 140 countries. Citigroup's businesses are aligned in three reporting segments: (i) Citicorp, which consists of Regional Consumer Banking (in North America, EMEA, Asia, and Latin America) and the Institutional Clients Group (Securities and Banking, including the Private Bank, and Transaction Services); (ii) Citi Holdings, which consists of Brokerage and Asset Management, Local Consumer Lending, and a Special Asset Pool; and (iii) Corporate/Other. 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 $45 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 selling assets to repay the bailout funds. Citigroup is one of the banks that, according to results of the government's stress test, need more capital. CLEARPOINT BUSINESS: ComVest Capital Holds 56.7% of Shares ---------------------------------------------------------- ComVest Capital, LLC; ComVest Capital Management, LLC; Michael S. Falk and Robert L. Priddy disclosed that as of February 16, 2010, they may be deemed to beneficially own in the aggregate 18,670,825 shares or roughly 56.7% of ClearPoint Business Resources, Inc. In June 2008, ComVest entered into a Revolving Credit and Term Loan Agreement with ClearPoint, which included a revolving credit facility. In August 2009, ComVest amended the Original Agreement to provide for a restructured revolving credit facility to ClearPoint, with maximum availability of $10.5 million. In connection with the Amended Agreement, ComVest received an amended and restated warrant, dated August 14, 2009, to purchase, in the aggregate, 2,210,825 shares of Common Stock. By its terms, the Warrant would become exercisable for a substantially increased number of shares upon the occurrence and during the continuation of certain events of default under the Amended Agreement, at the reduced exercise price of $0.001 per share of Common Stock In February 2010, ClearPoint defaulted on its obligations under the Amended Agreement. Accordingly, ComVest elected to invoke the default exercise provision under the Warrant, and as a result was issued 18,670,825 shares of Common Stock, for an exercise price of approximately $18,671. In connection with this transaction, effective February 16, 2010, ComVest et al. owned 56.7% of outstanding shares of the Common Stock. In connection with the exercise of the Warrant, certain members of the Company's board of directors resigned, and the board appointed Gary E. Jaggard to serve as a Class B director effective February 16, 2010. Mr. Jaggard serves as the Managing Director of ComVest. About ClearPoint Business Resources Halfont, Pennsylvania-based 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 September 30, 2009, the Company had $2,803,735 in total assets and $27,426,894 in total liabilities, resulting in $24,623,159 in stockholders' deficit. Going Concern Opinion Historically, ClearPoint has funded its cash and liquidity needs through cash generated from operations and debt financing. At September 30, 2009, the Company had an accumulated deficit of $57,278,493 and working capital deficiency of $9,466,342. For the nine months ended September 30, 2009, the Company incurred a net loss of $2,787,950. 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. CLEARPOINT BUSINESS: To Discontinue Quotation of Stock on OTCBB --------------------------------------------------------------- ClearPoint Business Resources, Inc., intends to voluntarily discontinue the quotation of its common stock on The OTC Bulletin Board and to deregister its common stock under the Securities Exchange Act of 1934. In connection with the deregistration, ClearPoint will no longer be subject to SEC reporting requirements and ClearPoint's common stock will no longer be quoted on The OTC Bulletin Board. ClearPoint expects that its common stock will continue to be quoted on the Pink Sheets and intends to continue to make financial information available to stockholders upon request. Michael D. Traina, Chief Executive Officer of ClearPoint, stated, "After careful analysis, the Board of Directors concluded that the costs of public company compliance, coupled with the lost productivity resulting from management's compliance activities, significantly outweigh the benefits to ClearPoint of the quotation of its common stock on The OTC Bulletin Board." ClearPoint expects that it will file on or about March 30, 2010, a Form 15 with the SEC, which will result in the voluntary deregistration of ClearPoint's common stock and immediate suspension of ClearPoint's obligation to file periodic reports under the Securities Exchange Act of 1934, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, except that ClearPoint intends to file with the SEC its Annual Report on Form 10-K for the fiscal year ended December 31, 2009. The deregistration itself is expected to be made effective by the SEC within 90 days of the filing of the Form 15. Following the deregistration, ClearPoint's common stock is expected to be quoted on the Pink Sheets, a centralized electronic quotation service for over-the-counter securities, so long as market makers demonstrate an interest in trading in ClearPoint's stock. However, ClearPoint can give no assurance that trading in its stock will continue on the Pink Sheets or on any other securities exchange or quotation medium or that its common stock will be actively traded. ClearPoint is committed to providing as much transparency as is beneficial and warranted under those conditions. The Company has filed with the Securities and Exchange Commission a Post-Effective Amendment No. 1 to Registration Statement No. 333-144209 on Form S-8 filed with the SEC on June 29, 2007, to deregister under the Securities Act of 1933, as amended, 2,750,000 shares of ClearPoint common stock that remain unsold under the Registration Statement. No shares of the 2,750,000 shares of common stock originally registered under the Registration Statement were issued pursuant to the ClearPoint Business Resources, Inc. 2006 Long-Term Incentive Plan. The Company also filed Post-Effective Amendment No. 2 to Registration Statement No. 333-156450 on Form S-1 filed with the SEC on December 24, 2008, and declared effective by the SEC on December 31, 2008, as amended by the Post-Effective Amendment No. 1 filed with the SEC on September 24, 2009 and declared effective by the SEC on October 1, 2009, and supplemented from time to time, to deregister 3,710,825 shares of common stock that remain unsold under the Registration Statement. In connection with certain financing transactions, the Company issued warrants to purchase, in the aggregate, 3,710,825 shares of the Company's common stock. The Registration Statement registered up to 3,710,825 shares of common stock issuable upon the exercise of the Warrants for resale by the holders of the Warrants. About ClearPoint Business Resources Halfont, Pennsylvania-based 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 September 30, 2009, the Company had $2,803,735 in total assets and $27,426,894 in total liabilities, resulting in $24,623,159 in stockholders' deficit. Going Concern Opinion Historically, ClearPoint has funded its cash and liquidity needs through cash generated from operations and debt financing. At September 30, 2009, the Company had an accumulated deficit of $57,278,493 and working capital deficiency of $9,466,342. For the nine months ended September 30, 2009, the Company incurred a net loss of $2,787,950. 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. COMFORCE CORP: ARTRA 524(g) Asbestos Trust Holds 8.4% of Shares --------------------------------------------------------------- ARTRA 524(g) Asbestos Trust in Wilmington, Delaware, and ARTRA Group, Incorporated in Bloomingdale, Illinois, disclosed that they may be deemed to beneficially own in the aggregate 1,463,000 shares or roughly 8.4% of the common stock of COMFORCE Corporation. About COMFORCE Based in Woodbury, New York, COMFORCE Corporation (NYSE Amex: CFS) provides outsourced staffing management services that enable Fortune 1000 companies and other large employers to consolidate, automate and manage staffing, compliance and oversight processes for their contingent workforces. The Company also provides specialty staffing, consulting and other outsourcing services to Fortune 1000 companies and other large employers for their healthcare support services, technical and engineering, information technology, telecommunications and other staffing needs. In addition, the Company provides funding and back office support services to independent consulting and staffing companies. At December 27, 2009, the Company had total assets of $165,285,000 against total liabilities of $180,744,000, resulting in stockholders' deficit of $15,459,000. At December 28, 2008, the Company had stockholders' deficit of $3,833,000. COMFORCE CORP: RBF Capital Holds 9.51% of Common Stock ------------------------------------------------------ RBF Capital, LLC, and Richard B. Fullerton, its managing member, disclosed that as of December 31, 2009, they may be deemed to beneficially own 1,653,173 shares or roughly 9.51% of the common stock of COMFORCE Corporation. About COMFORCE Based in Woodbury, New York, COMFORCE Corporation (NYSE Amex: CFS) provides outsourced staffing management services that enable Fortune 1000 companies and other large employers to consolidate, automate and manage staffing, compliance and oversight processes for their contingent workforces. The Company also provides specialty staffing, consulting and other outsourcing services to Fortune 1000 companies and other large employers for their healthcare support services, technical and engineering, information technology, telecommunications and other staffing needs. In addition, the Company provides funding and back office support services to independent consulting and staffing companies. At December 27, 2009, the Company had total assets of $165,285,000 against total liabilities of $180,744,000, resulting in stockholders' deficit of $15,459,000. At December 28, 2008, the Company had stockholders' deficit of $3,833,000. COMFORCE CORP: WC Capital Management Holds 4.6% of Shares --------------------------------------------------------- WC Capital Management, LLC; Aaron H. Braun; Willow Creek Capital Partners, L.P.; and Willow Creek Short Biased 30/130 Fund, L.P., disclosed that they may be deemed to beneficially own 794,500 shares or roughly 4.6% of the common stock of COMFORCE Corporation. About COMFORCE Based in Woodbury, New York, COMFORCE Corporation (NYSE Amex: CFS) provides outsourced staffing management services that enable Fortune 1000 companies and other large employers to consolidate, automate and manage staffing, compliance and oversight processes for their contingent workforces. The Company also provides specialty staffing, consulting and other outsourcing services to Fortune 1000 companies and other large employers for their healthcare support services, technical and engineering, information technology, telecommunications and other staffing needs. In addition, the Company provides funding and back office support services to independent consulting and staffing companies. At December 27, 2009, the Company had total assets of $165,285,000 against total liabilities of $180,744,000, resulting in stockholders' deficit of $15,459,000. At December 28, 2008, the Company had stockholders' deficit of $3,833,000. COMMERCIAL VEHICLE: Completes Public Offering of Common Stock ------------------------------------------------------------- Commercial Vehicle Group Inc. has completed its public offering of common stock at a price of $6.25 per share to the public. The Company also announced that the underwriter in the offering has exercised its option to purchase additional shares to cover over- allotments, resulting in a total sale to the public of 4,370,000 shares of common stock. The Company received approximately $25.4 million of net proceeds from the offering, after deducting underwriting discounts and commissions and estimated expenses of the offering. The Company expects to use the net proceeds from the offering for general corporate and working capital purposes, including the funding of strategic initiatives that the Company may undertake from time to time. Robert W. Baird & Co. acted as underwriter for the offering. About Commercial Vehicle Group New Albany, Ohio-based Commercial Vehicle Group, Inc., (Nasdaq: CVGI) supplies fully integrated system solutions for the global commercial vehicle market, including the heavy-duty truck market, the construction and agricultural markets, and the specialty and military transportation markets. The products include static and suspension seat systems, electronic wire harness assemblies, controls and switches, cab structures and components, interior trim systems (including instrument panels, door panels, headliners, cabinetry and floor systems), mirrors and wiper systems specifically designed for applications in commercial vehicles. The Company has facilities located in the United States in Arizona, Indiana, Illinois, Iowa, North Carolina, Ohio, Oregon, Tennessee, Virginia and Washington and outside of the United States in Australia, Belgium, China, Czech Republic, Mexico, Ukraine and the United Kingdom. Commercial Vehicle Group Inc.'s balance sheet for December 31, 2009, showed $250.5 million in total assets and $288.2 million in total liabilities for a $37.7 million stockholders' deficit * * * Commercial Vehicle carries a 'Caa2' Corporate Family Rating and 'Caa2/LD' Probability of Default Rating from Moody's. It has a 'CCC+' corporate credit rating from Standard & Poor's. CONVERSION SERVICES: Friedman LLP Raises Going Concern Doubt ------------------------------------------------------------ On March 26, 2010, Conversion Services International, Inc., filed its annual report on Form 10-K for the year ended December 31, 2009. Frieman LLP, in East Hanover, N.J., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring operating losses, negative cash flows, is not in compliance with a covenant associated with its Line of Credit and has significant future cash flow commitments. The Company reported net income of $31,956 on $24.2 million of revenue for the year ended December 31, 2009, compared with a net loss of $10.5 million on $19.7 million of revenue for 2008. In 2008, the Company recorded a total of $6.9 million in goodwill and intangible assets impairment charges. There were no impairments of goodwill or intangible assets recorded during the year ended December 31, 2009. The Company's balance sheet as of December 31, 2009, showed $4.5 million in assets, $5.3 million of debts, and $1.5 million of Series A convertible preferred stock, for a stockholders' deficit of $2.3 million. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5cb6 East Hanover, N.J.-based Conversin Services International, Inc. is a technology and business process improvement and management firm providing professional services to the Global 2000 as well as mid- market clientele. COOPER-STANDARD: Court OKs Equity Investment Pact with Noteholders ------------------------------------------------------------------ Cooper-Standard Holdings Inc. disclosed that the United States Bankruptcy Court for the District of Delaware approved its First Amended Disclosure Statement in connection with its proposed Second Amended Joint Chapter 11 Plan of Reorganization. The Court also approved the Equity Commitment Agreement with certain of the Company's noteholders which, as announced previously, provides the Company with a committed equity investment of $355 million. The Court has also authorized the Company to solicit approval of the Amended Plan from its creditors. The hearing for the Court to consider confirmation of the Plan has been scheduled for May 12, 2010. As previously announced, under the proposed Amended Plan the Company's balance sheet will be significantly deleveraged with an estimated funded debt balance at emergence of approximately $480 million, representing a reduction of over $650 million from pre-petition levels. Court filings, including the proposed Amended Plan and Disclosure Statement, are available at http://www.kccllc.net/cooperstandard. About Cooper-Standard Automotive Cooper-Standard Automotive Inc., -- http://www.kccllc.net/cooperstandard.-- headquartered in Novi, Michigan, is a leading global supplier of systems and components for the automotive industry. Products include body sealing systems, fluid handling systems and anti-vibration systems. Cooper-Standard Automotive employs approximately 16,000 people globally and operates in 18 countries around the world. COOPER-STANDARD: CSA Canada Gets OK to Pay RSM, Ogilvy ------------------------------------------------------ Cooper-Standard Automotive Canada Ltd. sought and obtained an order from the Ontario Superior Court of Justice approving the payment of fees and expenses of RSM Richter Inc. and Ogilvy Renault LLP. RSM Richter sought payment of C$194,897 in fees and C$474 in reimbursable expenses while Ogilvy sought payment of C$142,956 in fees and C$1,920 in reimbursable expenses for the period August 4, 2009 to February 28, 20l0. RSM Richter is the firm appointed by the Canadian Court to monitor the assets of CSA Canada while Ogilvy serves as RSM Richter's legal counsel. Meanwhile, Cooper-Standard Automotive Canada Ltd. sought and obtained a court order approving these activities undertaken by RSM Richter Inc. as its monitor: (1) the filing of January 14, 2010 monitor report to disclose a change in CSA Canada's cash flow projections; (2) reviewing weekly financial information; (3) communicating with creditors as required; (4) attending in Court; (5) monitoring filings in the Chapter 11 proceedings of CSA Canada's U.S.-based affiliates; and (6) drafting its monitor report dated March 10, 2010. 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- COVER-ALL BUILDING: Filed for Bankruptcy Under Canadian Law ----------------------------------------------------------- Danny Robbins at The Associated Press reports tat Cover-All Building Systems Inc. of Saskatoon, Saskatchewan, filed for bankruptcy protection under the Canadian law governing bankruptcies. All 500 employees of the Company were laid off. Mr. Robbins relates that Ernst & Young was appointed as monitor of the Company's restructuring. Cover-All Building Systems Inc. manufactures world leading, pre- engineered fabric storage building solutions. COYOTES HOCKEY: Financing Hinges on Arena Lease Rework ------------------------------------------------------ A person with knowledge of Ice Edge Holding's bid to buy the Coyotes Hockey from the National Hockey League said a new ownership group's ability to get financing to buy the team hinges on a reworking of the team's arena lease in Glendale, reports Mike Sunnucks at Business Journal of Phoenix. Mr. Sunnucks notes Ice Edge is running into some challenges in getting financing to buy the team. He adds that Jerry Reinsdorf resurfaces as possible Coyotes purchaser. About Coyotes Hockey Dewey Ranch Hockey LLC, Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC -- owners and affiliates of the Phoenix Coyotes National Hockey League team -- filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 09-09488) on May 5, 2009. The Debtors are represented by Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, in Phoenix, and estimate their assets and liabilities are between $100 million and $500 million. In November 2009, Judge Redfield T. Baum approved the sale of the Phoenix Coyotes to the National Hockey League, which had bought the team to quash a plan by bidder Jim Balsillie's to move the team to Ontario, Canada. Coyotes was sent to Chapter 11 to effectuate a sale by owner Jerry Moyes to Mr. Balsillie. The city of Glendale, Ariz., is seeking to convert the Coyotes' Chapter 11 case to a Chapter 7, echoing the Debtors and unsecured creditors' belief that the city is trying to wriggle out of having its bankruptcy claim estimated. The team's former owners have filed a Chapter 11 plan of liquidation, to rebuff the Chapter 7 conversion bid. CRESCENT RESOURCES: Confirmation Hearing Set for May 20 ------------------------------------------------------- Crescent Resources LLC will present its reorganization plan for confirmation at a hearing scheduled for May 20. U.S. Bankruptcy Judge Craig Gargotta has approved the disclosure statement explaining Crescent Resources' Chapter 11 plan. Accordingly, Crescent will be sending the Plan to creditors for voting. Crescent Resources LLC filed an amended reorganization plan on March 11. Significant terms of the Amended Plan include: -- Holders of prepetition secured debt will receive a combination of reinstated debt and 100% of the equity of the reorganized company. Holders of the prepetition lenders claims aggregating $1.55 billion will recover 38% of their claims. -- General unsecured creditors owed a total of $305.4 million will receive an interest in a litigation trust to be formed as part of the Plan. -- Various project level lenders will have their existing debt reinstated. Lazard estimates the Reorganized Debtors' enterprise value to range from approximately $588 million to approximately $665 million, with a midpoint of roughly $626 million. The Reorganization Value was based on the estimated enterprise value of the operations and assets of the Reorganized Debtors through the application of, among other analyses, a discounted cash flow valuation methodology of the Debtors' operations using a range of discount rates from 15% to 20%, which imputed a present value of free cash flows of those operations over the life of the business. Black-lined versions of the Amended Plan and Disclosure Statement are available for free at: http://bankrupt.com/misc/Crescent_AmendedDS.pdf http://bankrupt.com/misc/Crescent_AmendedPlan.pdf The Official Committee of Unsecured Creditors is opposing the Plan. It believes that a Chapter 7 liquidation will yield higher recoveries for unsecured creditors. About Crescent Resources Crescent Resources, LLC -- http://www.crescent-resources.com/-- is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Based in Charlotte, North Carolina, Crescent Resources is a joint venture between Duke Energy and the Morgan Stanley Real Estate Funds. Established in 1969, Crescent creates mixed-use developments, award-winning country club communities, single- family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Crescent Resources and 120 affiliates filed separate chapter 11 petitions on June 10, 2009 (Bankr. W.D. Tex. Lead Case No. 09- 11507). The Hon. Craig A. Gargotta presides over the case. Attorneys at Weil Gotshal Manges LLP represent the Debtors in their Chapter 11 cases. Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., serves as the Debtors' co-counsel. Garden City Group serves as claims and notice agent. The Debtors disclosed more than $1 billion each in assets and debts when they filed for bankruptcy. DELPHI CORP: Makes Tax Payments to Howard County ------------------------------------------------ In light of an agreement, Delphi Corp. and General Motors Company agreed to make regular payments on taxes owed to Howard County, in Maryland, Kokomo Tribune reports. As of March 10, 2010, GM and Delphi paid to the Howard County Treasurer $3,345,763 and interest payments of $262,719, Kokomo Tribune discloses. The report notes that Delphi only paid a portion of its personal and real estate taxes owed for 2005 and payable in 2006 to Howard County when it filed for bankruptcy. In light of the consummation of Delphi's Modified First Amended Joint Plan of Reorganization, personal property assessed at March 1, 2005, for $4,615,399 must be paid in full by March 1, 2010, with an interest rate to be set by the United States Bankruptcy Court for the Southern District of New York, Kokomo Tribune notes. The real estate taxes for 2005 for $1,881,860 will be paid over the next seven years with an interest rate of 5%, Kokomo Tribune adds. County Treasurer Martha Lake confirmed that Delphi has paid all taxes owed to local taxing entities, except for the 2005 taxes, Kokomo Tribune relates. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was 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 had 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. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. 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: Lockport Workers Balk at GM Concessions ---------------------------------------------------- Hourly workers at Delphi Corp.'s former plant in Lockport, New York, are angered by General Motors Company's latest proposed concessions at the plant, Thomas Hartley of Business First of Buffalo reports. Gordie Fletcher, president of United Autoworkers Local 786 Unit No. 1 at Lockport, disclosed that New GM wants members to forego a 3.75% cost-of-living raise that was scheduled to take effect in January 2010 but has not been paid, Business First relates. The hourly workers are also upset with the bonuses allegedly received by the salaried workers, according to the report. "We don't think that's fair," Mr. Fletcher was quoted by Business First as saying. Mr. Fletcher continued that there should be shared sacrifice among the workers. The report also notes that no new work was assigned to Lockport, which Mr. Fletcher said "adds to our immense sense of frustration." A GM spokesperson told Business First that discussions between the company and UAW are ongoing and no details are yet available. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was 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 had 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. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. 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: Flint Workers Eligible for Trade Assistance -------------------------------------------------------- In a public statement dated March 10, 2010, the U.S. Department of Labor said that workers at Delphi Corp.'s plant in Flint, Michigan, can avail of Trade Adjustment Assistance. Workers covered by TAA certifications will be contacted by their states with instructions on how to apply for individual benefits and services. While TAA is open to eligible workers of all ages, workers 50 years of age and older may elect to receive Re- employment Trade Adjustment Assistance instead. If a worker obtains new employment at wages less than $55,000 and less than wages earned in adversely affected employment, the RTAA program will pay 50% of the difference between the old wage and the new wage, up to $12,000 over a two-year period. RTAA participants may also be eligible for retraining and the Health Coverage Tax Credit. Dr. Ed Montgomery, executive director of the White House Council on Automotive Communities and Workers, said that through TAA certifications, workers and their families hit hard by automotive industry and industrial layoffs can receive income support, access to health care job training and other assistance as they transition to new jobs in growing sectors of the economy. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- was 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 had 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. Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will remain responsible for the post-Effective Date administration and eventual closing of the Chapter 11 cases as well as the disposition of certain retained assets and payment of certain retained liabilities as provided under the Modified Plan. 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) DELTA AIR: Janus Capital Discloses 6.7% Equity Stake ---------------------------------------------------- Janus Capital Management LLC reported in a Form 13G filed with the U.S. Securities and Exchange Commission on February 16, 2010, that it owns 52,145,580 shares of the Delta Air Lines, Inc. common stock or 6.7% of Delta's outstanding shares. Janus Capital also disclosed its sole voting power over 43,798,825 shares and sole dispositive power over 43,798,825 shares. Janus Capital has a direct 91.8% ownership stake in INTECH Investment Management and a direct 77.8% ownership stake in Perkins Investment Management LLC. Holdings for Janus Capital, Perkins and INTECH are aggregated for purposes of the Form 13G filing, David R. Kowalski, senior vice president and CCO at Janus Capital, told the SEC. Janus Capital, Perkins and INTECH are registered investment advisers, each furnishing investment advice to various investment companies registered under Section 8 of the Investment Company Act of 1940 and to individual and institutional clients. As a result of its role as investment adviser or sub-adviser to the Managed Portfolios, Janus Capital may be deemed to be the beneficial owner of 52,145,580 shares or 6.7% of the shares outstanding of Delta common stock held by those Managed Portfolios. However, Janus Capital does not have the right to receive any dividends from, or the proceeds from the sale of, the securities held in the Managed Portfolios and disclaims any ownership associated with those rights, Mr. Kowalski explains. Janus Overseas Fund is an investment company registered under the Investment Company Act of 1940 and is one of the Managed Portfolios to which Janus Capital provides investment advice. Delta had 779,521,801 shares outstanding as of September 30, 2009. About Delta Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to 367 destinations in 66 countries on six continents. Delta employs more than 70,000 employees worldwide and operates a mainline fleet of nearly 800 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry's trans-Atlantic joint venture with Air France KLM. Including its worldwide alliance partners, Delta offers customers more than 16,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline's service includes the SkyMiles frequent flier program, the world's largest airline loyalty program; the BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta became the world's largest airline following merger with Northwest Airlines in 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. At December 31, 2009, Delta had total assets of $43,539,000,000 against total current liabilities of $9,797,000,000 and total noncurrent liabilities of $33,497,000,000, resulting in stockholders' equity of $245,000,000. At end-2008, Delta had stockholders' equity of $874,000,000. The December 31, 2009 balance sheet showed strained liquidity: Delta had total current assets of $7,741,000,000 against total current liabilities of $9,797,000,000. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Negative/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DELTA AIR: Wellington Reports 11.23% Equity Stake ------------------------------------------------- In a third amended Form 13G filed with the U.S. Securities and Exchange Commission on February 12, 2010, Wellington Management Company LLP, disclosed that in its capacity as investment adviser, it may be deemed to beneficially own 87,546,200 shares of Delta Air Lines, Inc. common stock, which are held of record by its clients, or 11.23% of Delta's outstanding shares. Wellington also disclosed its shared voting power over 51,782,377 shares and shared dispositive power over 87,832,669 shares. Delta had 779,521,801 shares outstanding as of September 30, 2009. About Delta Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) -- http://www.delta.com/or http://www.nwa.com/-- serves more than 160 million customers each year. Delta and the Delta Connection carriers offer service to 367 destinations in 66 countries on six continents. Delta employs more than 70,000 employees worldwide and operates a mainline fleet of nearly 800 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry's trans-Atlantic joint venture with Air France KLM. Including its worldwide alliance partners, Delta offers customers more than 16,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline's service includes the SkyMiles frequent flier program, the world's largest airline loyalty program; the BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta became the world's largest airline following merger with Northwest Airlines in 2008. Northwest and 12 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). On May 21, 2007, the Court confirmed the Northwest Debtors' amended plan. That amended plan took effect May 31, 2007. Delta and 18 affiliates filed for Chapter 11 protection on September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented the Delta Debtors in their restructuring efforts. On April 25, 2007, the Court confirmed the Delta Debtors' plan. That plan became effective on April 30, 2007. At December 31, 2009, Delta had total assets of $43,539,000,000 against total current liabilities of $9,797,000,000 and total noncurrent liabilities of $33,497,000,000, resulting in stockholders' equity of $245,000,000. At end-2008, Delta had stockholders' equity of $874,000,000. The December 31, 2009 balance sheet showed strained liquidity: Delta had total current assets of $7,741,000,000 against total current liabilities of $9,797,000,000. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). * * * Delta Air Lines and Northwest Airlines carry a 'B/Negative/--' corporate ratings from Standard & Poor's. They also continue to carry 'B2' corporate family ratings from Moody's and "B-" LT Issuer Default rating from Fitch. DUANE READE: December 26 Balance Sheet Upside-Down by $226.7MM -------------------------------------------------------------- On March 26, 2010, Duade Reade Holdings Inc. filed its annual report on Form 10-K for the year ended December 26, 2009. The Company's balance sheet as of December 26, 2009, showed $752.1 million in assets and $978.8 million of debts, for a stockholders' deficit of $226.7 million. The Company reported a net loss of $124.3 million on $1.837 billion of revenue for the fiscal year ended December 26, 2009, compared with a net loss of $72.8 million on $1.774 billion of revenue for the year ended December 27, 2008. The increase in net loss for the 2009 fiscal year, as compared to fiscal 2008, was primarily attributable to a $56.5 million increase in fair value charges, reflecting the increased probability of a near term mandatory redemption of the Company's redeemable preferred stock. Excluding the additional fair value charges, the Company's 2009 net loss would have declined by $5.0 million. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5cb8 Based in New York City, Duane Reade Holdings Inc. -- http://www.duanereade.com/-- is the largest drugstore chain in New York City. As of December 26, 2009, the Company operated 257 stores. DUNE ENERGY: NYSE Amex Accepts Firm's Plan for Compliance --------------------------------------------------------- Dune Energy, Inc., received notice from the staff of the NYSE Alternext US that the Exchange had accepted the Plan of Compliance previously submitted by the Company and determined that the Plan reasonably demonstrates the Company's ability to regain compliance under the Exchange's continued listing standards. By such notice, the Exchange granted the Company an extension until June 15, 2010, to regain compliance with the continued listing standards. The Company may continue its listing during the Extension Period. In December of 2009, the Company received notice from the Exchange indicating that the Company had failed to comply with certain of the Exchange's continued listing standards as set forth in Part 10 of the Exchange's Company Guide. Specifically, the Exchange noted that the Company was not in compliance with (a) Section 1003(a)(i) of the Company Guide, because its stockholders' equity is less than $2,000,000 and losses from continuing operations and it has had net losses in two out of its three most recent fiscal years; (b) Section 1003(a)(ii) of the Company Guide, because its stockholders' equity is less than $4,000,000 and it has had losses from continuing operations and net losses in three out of its four most recent fiscal years; and (c) Section 1003(a)(iii) of the Company Guide, because its stockholders' equity is less than $6,000,000 and it has had losses from continuing operations and net losses in its five most recent fiscal years. The Exchange afforded the Company the opportunity to submit a plan of compliance and on January 26, 2010, the Company submitted the Plan detailing actions to be taken to enable it to regain compliance with the continued listing standards within the allotted timeframe. If the Company fails to make progress toward compliance consistent with the Plan, or is not in compliance at June 15, 2010 (the end of the Extension Period), then the Company may be delisted by the Exchange. There can be no assurance that the Company will be able to implement the Plan within the prescribed timeframe. The Company will continue to be subject to periodic review by Exchange staff during the Extension Period. During the Extension Period, the Company's common stock will continue to trade on the Exchange, subject to the trading symbol extension ".BC" to denote its noncompliance with the Exchange's continued listing standards. EDWARD MARANDOLA: Files List of 20 Largest Unsecured Creditors -------------------------------------------------------------- Edward Marandola, Jr., has filed with the U.S. Bankruptcy Court for the District of Rhode Island a list of its 20 largest unsecured creditors. A full-text copy of the Debtor's list of creditors is available for free at http://bankrupt.com/misc/rib10-10343.pdf Newport, Rhode Island-based Edward Marandola filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. D. R.I. Case No. 10-10343). The Debtor estimated its assets and debts at $10,000,001 to $50,000,000. EDWARD MARANDOLA: Taps Raskin & Berman as Bankruptcy Counsel ------------------------------------------------------------ Edward Marandola, Jr., has sought permission from the U.S. Bankruptcy Court for the District of Rhode Island to employ Raskin & Berman as bankruptcy counsel. Raskin & Berman will provide advice and consultation with the Debtor and appear for, prosecute, defend and represent the Debtor's interests generally. Russell D. Raskin, a partner at Raskin & Berman, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Neither Raskin & Berman nor the Debtor disclosed how the firm will be compensated for its services. Newport, Rhode Island-based Edward Marandola filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. D. R.I. Case No. 10-10343). The Debtor estimated its assets and debts at $10,000,001 to $50,000,000. ELLICOTT SPRINGS: Files Schedules of Assets and Liabilities ----------------------------------------------------------- Ellicott Springs Resources, LLC, filed with the U.S. Bankruptcy Court for the District of Colorado its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $5,940,000 B. Personal Property $16,000,030 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $5,210,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $3,201,246 ----------- ----------- TOTAL $21,940,030 $8,411,246 Colorado Springs, Colorado-based Ellicott Springs Resources, LLC, filed for Chapter 11 bankruptcy protection on February 19, 2010 (Bankr. D. Colo. Case No. 10-13116). The Company estimated its assets and debts at $10,000,001 to $50,000,000. On the same date, these affiliates also filed for Chapter 11 bankruptcy protection in the same bankruptcy court: -- Ellicott Springs Development, LLC (Case No. 10-13117); -- PLW, Inc. (Case No. 10-13114); and -- Rodney J. Preisser (Case No. 10-13110) Those debtors are also based in Colorado Springs, Colorado, and each also have estimated assets and debts of $10,000,001 to $50,000,000. ERNIE JACOBSEN: Hearing on Plan Filing Extension Set for April 8 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Mississippi will consider at a hearing on April 8, 2010, at 10:00 a.m., the extension of Ernie Lee Jacobsen and Donna Jean Jacobsen's exclusive period to file a Chapter 11 Plan and Disclosure Statement. The hearing will be held at Cochran U.S. Bankruptcy Courthouse. Objections, if any are due today, March 30, 2010. The Debtors sought a 90 days' extension in their Plan filing period and a similar extension to obtain Plan confirmation. The Debtors are represented by: Craig M. Geno, Esq. Jeffrey K. Tyree, Esq. Melanie T. Vardaman, Esq. Harris Jernigan & Geno, PLLC 587 Highland Colony Parkway (39157) P.O. Box 3380 Ridgeland, MS 39158-3380 Tel: (601) 427-0048 Fax: (601) 427-0050 Ernie Lee Jacobsen and Donna Jean Jacobsen filed for Chapter 11 bankruptcy protection on October 29, 2009 (Bankr. N.D. Miss. Case No. 09-15667). Craig M. Geno, Esq., at Harris Jernigan & Geno, PLLC, assists the Jacobsens in its restructuring effort. The joint debtors listed assets of $15,283,881 and debts of $16,518,690 in their schedules. FAIRVUE CLUB: Has Until April 20 to Propose Reorganization Plan --------------------------------------------------------------- The Hon. George C. Paine, II of the U.S. Bankruptcy Court for the Middle District of Tennessee extended Fairvue Club Properties, LLC's exclusive period to file a Chapter 11 Plan until April 20, 2010, and its solicitation period until June 30, 2010. The Debtor is represented by: William L. Norton III Bradley Arant Boult Cummings LLP 1600 Division Street, Suite 700 P.O. Box 340025 Nashville, TN 37203 Tel: (615) 252-2397 Email: bnorton@babe.com Gallatin, Tennessee-based Fairvue Club Properties, LLC, filed for Chapter 11 bankruptcy protection on December 1, 2009 (Bankr. M.D. Tenn. Case No. 09-13807). William L. Norton, III, Esq., at Bradley Arant Boult Cummings LLP assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. FAYETTEVILLE MARKETFAIR: No Creditors Committee Appointed --------------------------------------------------------- Marjorie K. Lynch, the administrator of Fayetteville Marketfair Investors, LLC's bankruptcy case, told the U.S. Bankruptcy Court for the Eastern District of North Carolina that she has been unable to organize and recommend to the Court the appointment of a committee of creditors holding unsecured claims against the Debtor. Ms. Lynch said that despite her efforts to contact unsecured creditors, as of the date of the 11 U.S.C. Sec. 341 meeting of creditors, sufficient indications of willingness to serve on a committee of unsecured creditors were not received from persons eligible to serve on the committee Miami, Florida-based Fayetteville Marketfair Investors, LLC, filed for Chapter 11 on Dec. 14, 2009 (Bankr. E.D. N.C. Case No. 09- 10859). William P. Janvier, Esq., at Everett Gaskins Hancock & Stevens, LLP, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. FILI ENTERPRISES: Court Sets April 26 as Claims Bar Date -------------------------------------------------------- Hon. Peter W. Bowie of the U.S. Bankruptcy Court for the Southern District of California has established April 26, 2010, as the last day for any individual or entity to file proofs of claim against Fili Enterprises, Inc. The Court also set June 10, 2010, as the bar date for governmental units. San Diego, California-based Fili Enterprises, Inc. -- dba Daphne's Greek Cafe, aka Daphne's Greek Express -- filed for Chapter 11 bankruptcy protection on January 11, 2010 (Bankr. S.D. Calif. Case No. 10-00324). Brendan Collins, Esq., and Natasha Johnson, Esq., at DLA Piper LLP (US), assist the Company in its restructuring effort. In its schedules of assets and liabilities, the Company disclosed total assets of $16,723,356 and total liabilities of $16,335,468. FLYING J: Gets Approval to Lease Stores to Denny's -------------------------------------------------- Bill Rochelle at Bloomberg News reports that Flying J Inc. received approval from the Bankruptcy Court to lease its restaurants to Denny's Inc. under an agreement estimated to improve cash flow by $15 million a year. According to the report, Flying J has 250 locations, including 164 with restaurants. The lease initially would cover only locations owned by Flying J. The agreement, the Bloomberg report relates, provides for Denny's to pay $250,000 for the equipment at each location while spending an average of $200,000 to $300,000 in upgrades on each store. In addition, Denny's would pay rent of 7% to 8% of total sales. About Flying J Inc. 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. FREEDOM COMMUNICATIONS: Gets Nod to Sell Arizona Newspapers ----------------------------------------------------------- Freedom Communications Holdings, Inc. and its unit sought and obtained authorization from the Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware to sell certain assets of Freedom Arizona Information, Inc. to 1013 Communications, LLC, free and clear of liens, claims, encumbrances and other interests, subject to higher and better bids. The assets to be sold include those owned solely by Freedom Arizona and used primarily in the operation of the businesses operated in connection with (a) the publication of the East Valley Tribune, Mesa Tribune, Gilbert Tribune, Chandler Tribune and Queen Creek Tribune newspapers and their respective Web sites and domain names; (b) the Daily News-Sun and yourwestvalley.com, dailynews- sun.com, surprisetoday.com and westvalleypreps.com Web sites and domain names; (c) the Ahwatukee Foothill News and its Web site and domain name; and (d) the Arizona Interactive Media Group and azimg.com, veep4u.com, and azclipper.com Web sites and domain names. The purchase price for the assets would be (a) $2,050,000; plus or minus (b) a working capital adjustment as described in the Seller's Asset Purchase Agreement with 1013 Communications; plus (c) any severance liabilities and any employer payroll taxes paid by the Seller or its affiliates in connection with the severance liabilities that in the aggregate exceed $779,000; plus (d) the cure amounts for the assigned contracts. A copy of the Asset Purchase Agreement is available for free at: http://ResearchArchives.com/t/s?5cbc http://ResearchArchives.com/t/s?5cbd The Debtors had set a March 5 deadline for competing bids. An auction was to be held on March 8 if competing bids were received. The Court held a hearing on the sale and entered the sale order on March 9. The Debtors expect the sale closing date to be on or before the effective date of their Chapter 11 plan. In the event the sale closing date occurs after the Plan effective date, the Debtors will reject the rejected contracts effective as of the sale closing date. The Court authorized the assumption and assignment of the executor contracts and unexpired leases. A copy of the assigned contracts is available for free at: http://ResearchArchives.com/t/s?5cbe The Court authorized the rejection of the contracts and unexpired leases as of the date the sale is closed. A copy of the rejected contracts is available for free at: http://ResearchArchives.com/t/s?5cbf The Court has allowed the Debtors to pay a $91,500 commission and expense reimbursement of $1,095 to Dirks, Van Essen & Murray, the sale advisor. About Freedom Communications Freedom Communications, headquartered in Irvine, California, 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. FREEPORT-MCMORAN: Fitch Affirms Preferred Stock Rating at 'BB' -------------------------------------------------------------- Fitch Ratings has affirmed the Issuer Default Rating and debt ratings of Freeport-McMoRan Copper & Gold Inc. and its subsidiary Phelps Dodge Corporation: FCX -- IDR at 'BBB-'; -- $1 billion secured bank revolver at 'BBB-'; -- $500 million PT Freeport Indonesia/FCX secured bank revolver at 'BBB-'; -- Unsecured notes due 2015 and 2017 at 'BBB-'; -- 7% convertible notes due 2011 at 'BBB-'; and -- Convertible preferred stock at 'BB'. PD -- 8.75% senior unsecured notes due 2011 at 'BBB-'; -- 7.125% senior unsecured debentures due 2027 at 'BBB-'; -- 9.50% senior unsecured notes due 2031 at 'BBB-'; and -- 6.125% senior unsecured notes due 2034 at 'BBB-'. The Rating Outlook is Positive. The ratings reflect debt reductions, the expected elimination of preferred shares and expectations for continued strong free cash flow. Long term copper fundamentals benefit from short supply, modest inventories and strong demand from China. The Positive Ratings Outlook reflects FCX's cautious approach to capital expenditures, dividends and financial leverage and Fitch's outlook on the copper market. An upgrade of the rating would be warranted if the company continues to generate strong free cash flow and the copper market remains stable. In first quarter-2009, FCX raised $740 million in net proceeds from the sale of common stock to provide additional liquidity given development in Africa, low copper prices and the state of the financial markets. Over the year, FCX repaid $1 billion in debt and announced that it will redeem its $1 billion floating rate notes on April 1, 2010. Pro forma for the transaction and open market purchases to date, total debt will be approximately $5 billion. Operating EBITDA for 2009 was $7.7 billion resulting in a pro forma total debt/operating EBITDA of 0.7 times (x). At Dec. 31, 2009, cash on hand was $2.7 billion of which $2.2 billion would be available to the parent company after non-controlling interests and withholding taxes. Guidance for annual average cash flow from operations for 2010 and 2011 is between $3.7 billion and $6.5 billion (copper prices between $2.50/lb. and $3.50/lb.) and for 2010 capital expenditures is $1.7 billion. Fitch estimates common and preferred dividends of about $370 million for the year given the conversion of the 6.25% preferred shares in May 2010. Maturities of debt will be $16 million in 2010, $93 million in 2011, and $14 million in 2012. The $1.5 billion in revolvers due 2012 were fully available except for $39 million representing letters of credits issued at Dec. 31, 2009. Operating EBITDA for 2009 was $7.7 billion and FCX guides to an annual average EBITDA range for 2010 and 2011 of between $5.7 billion and $9.7 billion for copper prices between $2.50/lb. and $3.50/lb. These levels correspond to a total debt to EBITDA range of 0.9x to 0.5x on a gross basis and between 0.6x and 0.4x on a net basis. Fitch notes that earnings and cash flows are highly leveraged to metals prices and a $0.10/lb. decline in copper prices could cut EBITDA by $375 million over a 12-month period. In particular, FCX realized $2.60/lb. of copper in 2009. The ratings reflect FCX's position as the world's second largest copper producer, its diversified operations, strong liquidity, and sound operational and financial management as well as the company's exposure to copper prices. Operations benefit from low average costs, large scale and long lived reserves. FREMONT GENERAL: Court Approves Closing Agreement with IRS ---------------------------------------------------------- In a regulatory filing Friday, Fremont General Corporation disclosed that on March 24, 2010, the U.S. Bankruptcy Court for the Central District of California approved the Closing Agreement to be entered into by the Company and the Internal Revenue Service. The Closing Agreement resolves all adjustments related to the IRS's examination of the Company's consolidated taxpayer group's federal income tax return for the tax period ended December 31, 2006, and determines the allowable net operating loss deduction for the year ended December 31, 2004, attributable to the NOL carryback from the year ended December 31, 2006. As a result of the adjustments reflected in the Closing Agreement, the Company's consolidated taxpayer group will owe the IRS roughly $2.2 million in additional income tax attributable to the tax year ended December 31, 2004, before interest and penalties, if applicable. Pursuant to the Internal Revenue Code of 1986, as amended, the Closing Agreement must be approved by the U.S. Congress Joint Committee on Taxation before the IRS may enter into the Closing Agreement. In the event the Joint Committee disapproves or objects to the Closing Agreement on or before December 31, 2010, the IRS is entitled to further amend its proof of claim. The Closing Agreement completes the resolution of the IRS's proof of claim, in the amount of $89,384,470.43, which was initially filed with the Bankruptcy Court on September 30, 2008, in connection with the Company's voluntary petition under Chapter 11 for unresolved disputes related to Company's consolidated taxpayer group's federal income tax returns for the tax periods ended December 31, 2004 through December 31, 2007. A full-text copy of the regulatory filing on Form 8-K is available for free at http://researcharchives.com/t/s?5cb9 About Fremont General Based in Santa Monica, California, Fremont General Corp. (OTC: FMNTQ) -- http://www.fremontgeneral.com/-- was a financial services holding company with $8.8 billion in total assets at September 30, 2007. Fremont General ceased being a financial services holding company on July 25, 2008, when its wholly owned bank subsidiary, Fremont Reorganizing Corporation (f/k/a Fremont Investment & Loan) completed the sale of its assets, including all of its 22 branches, and 100% of its $5.2 billion of deposits to CapitalSource Bank. Fremont General filed for Chapter 11 protection on June 18, 2008, (Bankr. C.D. Calif. Case No. 08-13421). Robert W. Jones, Esq., and J. Maxwell Tucker, Esq., at Patton Boggs LLP, Theodore Stolman, Esq., Scott H. Yun, Esq., and Whitman L. Holt, Esq., at Stutman Treister & Glatt, represent the Debtor as counsel. Kurtzman Carson Consultants LLC is the Debtor's noticing agent and claims processor. Lee R. Bogdanoff, Esq., Jonathan S. Shenson, Esq., and Brian M. Metcalf, at Klee, Tuchin, Bogdanoff & Stern LLP, represent the Official Committee of Unsecured Creditors as counsel. Fremont's formal schedules showed $330,036,435 in total assets and $326,560,878 in total debts. GENCORP INC: Moody's Upgrades Corporate Family Rating to 'B2' ------------------------------------------------------------- Moody's Investors Service has upgraded the ratings of GenCorp, Inc. including the Corporate Family and Probability of Default ratings to B2, senior secured credit facilities to Ba2, as well as the convertible subordinated notes to Caa1. The 9 1/2% senior subordinated notes were confirmed at B1. The rating outlook is stable. This completed the review for possible upgrade initiated on December 15, 2009. The upgrade follows the two recently completed financial transactions strengthening the company's capital structure and near-term liquidity profile. The first was the successful placement of a $200 million 4 1/16% convertible subordinated note issue due 2039, with a majority of the proceeds used to meet the January 2010 put of a $125 million 4% convertible subordinated note issue and thereby removing a major liquidity concern and rating constraint. The second is the March 17, 2010 amendment to the June 2007 secured credit agreement which, among other considerations, allows the company to incur additional senior unsecured or subordinated indebtedness as well as to repurchase or refinance its outstanding convertible subordinated notes and the 9 1/2% subordinated notes, subject to specified limits. Subsequent to the amendment, a portion of the net proceeds of the $200 million convertible subordinated issue was used to repurchase $22.5 million of the 9 1/2% subordinated notes and $14.3 million of the 2 1/4% convertible subordinated issue due 2024. The 2 1/4% convertible issue has a November 20, 2011 put date. The B2 CFR and stable rating outlook reflect GenCorp's improved financial position and greater flexibility and the company's recent track record of stronger cash flow generation. The rating continues to be supported by its subsidiary Aerojet-General's long-term historic position as a key niche supplier of solid and liquid rocket propulsion systems for defense and space applications despite its relatively small scale. While always vulnerable to changes in the Department of Defense system priorities, GenCorp benefits from a large number of contracts across multiple platforms, with impressive revenue visibility as implied by a large and growing backlog. In addition, GenCorp's substantial excess real estate holdings in the Sacramento area, while not a major near-term consideration in the rating, could provide an avenue for substantial long-term debt reduction if the company completes further re-zoning and entitlement efforts and the California real estate market recovers. While the financial profile has shown significant improvement, including a much higher cash position, and a corporate refocusing on its aerospace core operations, the rating is constrained by the possible November 20, 2011 put of the 2 1/4% convertible subordinated issue and the ongoing legacy burden of the substantial environmental liability and the now significant amount of unfunded non-current pension liability, $220 million as of February 28, 2010, and the possible need to make cash contributions. The ratings and/or outlook could be upgraded if GenCorp were to continue its positive trajectory in operating performance and cash flow generation. Resolution of the possible 2011 put could further improve the company's capital structure and medium-term liquidity profile. The ratings and/or outlook could be downgraded if the company were unable to address the 2011 put through refinancing or on-going cash generation. Additionally, a downward revision in the outlook and/or rating would also likely occur if the company were to generate negative free cash flow on a sustainable basis or if GenCorp's liquidity profile were to deteriorate substantially from current levels. These ratings/assessments have been affected: * Corporate Family Rating, upgraded to B2 from B3; * Probability of Default Rating, upgraded to B2 from Caa1; * Senior secured credit facilities, upgraded to Ba2 (LGD1, 5%) from Ba3 (LGD1, 5%); * Senior subordinated notes, confirmed at B1 (LGD3, 35%) from B1 (LGD2, 18%); * Convertible subordinated notes, upgraded Caa1 (LGD5, 81%) from Caa2 (LGD4, 60%). The last rating action was on December 15, 2009, when GenCorp, Inc.'s ratings were placed on review for possible upgrade. GenCorp Inc., headquartered in Rancho Cordova, CA, through its Aerojet-General subsidiary produces propulsion systems and products used in the aerospace and defense industries and has a real estate segment whose activities relate to re-zoning, entitlement, sale, and leasing of the Company's excess real estate assets in the Sacramento, CA area. Revenue for the last 12-month period ended 11/30/09 was approximately $795 million. GENCORP INC: Notes of Continued Progress on Cash Flow Goals ----------------------------------------------------------- GenCorp Inc. disclosed that on March 26, 2010, Moody's Investors Service upgraded both its Corporate Family Rating to B2 from B3 and Probability of Default ratings to B2 from Caa1. In addition, the senior secured credit facilities were upgraded to Ba2 from Ba3, as well as the convertible subordinated notes to Caa1 from Caa2. The 9 1/2% senior subordinated notes were confirmed at B1. Also, Moody's attached an outlook of "stable" to its credit rating of the Company. Moody's noted in its research update announcing the upgrade, "The B2 CFR and stable rating outlook reflect GenCorp's improved financial position and greater flexibility and the Company's recent track record of stronger cash flow generation." Moody's announcement follows a similar action taken by Standard & Poor's Ratings Services (S&P). On January, 22, 2010, S&P raised its ratings of GenCorp Inc. to B- from CCC+ and removed all ratings from CreditWatch. S&P attached an outlook of "stable" to its credit rating of the Company. S&P noted in its research update announcing the upgrade, "The rating actions follow the Company's repayment of $125 million of debt that was tendered to it, with proceeds from the $200 million in convertible subordinated debentures it issued in late December 2009." "These upgrades validate continued progress in our longer-term strategy to address our capital structure and focus on cash flow," said Kathy Redd, chief financial officer, GenCorp Inc. Rancho Cordova, Calif.-based GenCorp Inc. (NYSE: GY) -- http://www.GenCorp.com/-- is a manufacturer of aerospace and defense products and systems with a real estate segment that includes activities related to the re-zoning, entitlement, sale, and leasing of the Company's excess real estate assets. GENERAL GROWTH: Begins Filing Omnibus Claims Objection ------------------------------------------------------ General Growth Properties Inc. and its units have begun filing omnibus claims objections in their bankruptcy cases. In the first omnibus claims objection, the Debtors seek to disallow and expunge 99 claims, totaling $26,734,006 that are duplicative of other claims filed by or on behalf of the sale claimant. A schedule of the claims subject to the 1st Omnibus Claims Objection is available for free at: http://bankrupt.com/misc/ggp_1stOOClaimsSched.pdf In the second omnibus claims objection, the Debtors seek to disallow and expunge 98 claims amounting to $532,602,009 that are duplicative of other claims filed by or on behalf of the same claimant. A schedule of the claims subject to 2nd Omnibus Claims Objection is available for free at: http://bankrupt.com/misc/ggp_2ndOOClaimsSched.pdf In the third omnibus claims objection, the Debtors ask the Court to disallow and expunge 77 claims, totaling $20,018,991 that are duplicative of other claims filed by or on behalf of the same claimant. A schedule of the claims subject to 3rd Omnibus Claims Objection is available for free at: http://bankrupt.com/misc/ggp_3rdOOClaimsSched.pdf BCSI Inc.'s GENERAL GROWTH BANKRUPTCY NEWS provides definitive coverage of all omnibus claims objections, responses to claimants with respect to those objections, related settlements entered into by the parties, and orders entered by the Court. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No. 09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: Kirkland & Ellis, 4 Others Adjust Fees ------------------------------------------------------ Anup Sathy, P.C., Esq., a partner at Kirkland & Ellis LLP, filed a declaration in response to the Fee Committee's concerns regarding the firm's first interim fee application. K&E sought payment of fees for $6,968,587 and reimbursement of expenses for $349,415 for the period April 16 to August 31, 2009. With respect to the Fee Committee's concerns regarding K&E's duplication of efforts with attorneys from Weil Gotshal & Manges LLP on DIP loan issues, Mr. Sathy explains that the work performed by K&E attorneys focused on, among others, project-level issues raised in the objections to the Debtors' DIP loan and project- level corporate governance issues related to the DIP Loan. K&E has agreed to reduce its fees by $100,000 and its expenses by $25,000, totaling $125,000. Weil Gotshal previously filed its first interim fee application, seeking payment of fees for $9,829,093 and reimbursement of expenses for $391,834 for the period April 16 to August 31, 2009. After a discussion with the Fee Committee, Weil Gotshal has agreed to reduce its fees by $335,400 and expenses by $10,600 for the fee period totaling $346,000, Adam Strochak, Esq., a partner at Weil Gotshal, discloses. Thus, Weil Gotshal seeks payment of its fees for $9,493,693 and expenses for $381,234 for the fee period. Houlihan Lokey Howard & Zukin Capital, Inc., in its first interim fee application, seeks payment of fees for $1,136,666 and reimbursement of expenses for $80,848. To address the concerns raised by the Fee Committee, Houlihan Lokey agreed to reduce its travel-related expenses by $1,992; meal expenses by $3,506; and expenses by $457 to account for non-reimbursable overhead charges, totaling $5,956, Matthew R. Niemann, a managing director at Houlihan Lokey, notes. FTI Consulting Inc. sought payment of fees for $1,281,736 and reimbursement of expenses for $17,046 for the period April 27 to August 31, 2009. Steven Simms, a member of FTI, discloses that his firm agreed to reduce its fees and expenses aggregating $38,500 in light of the Fee Committee's concerns. FTI will also categorize all time entries according to the project categories and will try to recategorize all time entries made during the second interim period, he adds. Akin Gump Strauss Hauer & Feld LLP previously sought payment of fees for $6,131,334 and reimbursement of expenses for $209,019 for the period April 24, 2009 to August 31, 2009. To address the Fee Committee's concerns, Akin Gump has agreed to reduce its fees and expenses in connection with its first interim fee application by an aggregate amount of $125,000, including (i) a $3,249 reduction for travel-related expenses, (ii) a $4,500 reduction for meal expenses and a $716 reduction for photocopy charges. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No. 09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: Elliot Assoc. Has 2.2% Equity Stake --------------------------------------------------- In a Schedule 13G filed with the Securities and Exchange Commission on March 18, 2010, Elliott Associates, L.P., reported that it beneficially owns 6,886,300 shares of General Growth Properties, Inc.'s common stock, representing 2.2% of the 317,304,152 shares of GGP common stock outstanding as of February 24, 2010. Elliott Associates directs the voting and disposition of these shares. The 6,886,300 shares of GGP's common stock consisting of (i) 6,782,605 shares of common stock, and (ii) convertible notes convertible into an additional 103,695 shares of Common Stock. Elliott International, L.P. and Elliott International Capital Advisors Inc. together own 9,852,395 shares of GGP's common stock, representing 3.1% of GGP's total outstanding shares. They have shared power to dispose of and vote these shares. Elliott International, L.P. and Elliott International Capital Advisors Inc. are subsidiaries of Elliott Associates. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No. 09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Reveals Financial Leadership Changes ---------------------------------------------------- General Motors Vice Chairman and Chief Financial Officer Chris Liddell disclosed a number of key finance leadership changes aimed at further advancing the company's financial progress and preparing for its return to public ownership in the future. Walter Borst is named GM vice president and Promark Global Advisors, Inc. chief executive officer, reporting to Liddell, effective May 1, 2010. Promark is a wholly-owned asset management subsidiary of GM focused primarily on the management of retirement plan assets, including GM's pension plans assets. Mr. Borst, 48, will also continue as chairman of the Adam Opel GmbH Supervisory Board. Opel is GM's principal European automotive subsidiary, located in Germany. Mr. Borst was most recently GM vice president and treasurer, a post he has held since 2003. "Walter has done an outstanding job as treasurer," said Liddell. "He is a great fit to lead the team managing a crucial part of GM, the $115 billion in assets at Promark." During his 29 year GM career, Mr. Borst spent six years in Europe, and served as chief financial officer of Opel. Additionally, he held a number of assignments in the Treasurer's Office in New York and the Controller's Staff in Detroit. Over the years, Mr. Borst has been instrumental in a number of significant strategic and capital market transactions for GM, including the recent GM restructuring and sale of assets pursuant to Section 363 of the U.S. Bankruptcy Code, and the global capital markets debt offering to fund the GM pension deficit in 2003. He has also served on the GMAC Board of Directors. Mr. Borst succeeds Nancy Everett, who has announced her intention to leave the company June 1, 2010, and who will assist with the transition. Ms. Everett, 55, joined Promark Global Advisors as chief investment officer in 2005. She assumed the additional responsibility of chief executive officer in January 2006. In 2007, Ms. Everett restructured the portfolio to hedge against volatility that ultimately helped GM's pension fund withstand the negative market impact of 2008. "Nancy was a valuable contributor during one of the most difficult times in the financial market's history," said Liddell. "Under her leadership, Promark delivered consistent performance for its clients, often outperforming the market. We thank her for her contribution." Daniel Ammann has been appointed GM vice president finance and treasurer, reporting to Liddell, effective May 1, 2010. Mr. Ammann, 37, was most recently managing director and head of Industrials Investment Banking for Morgan Stanley, a position he held since 2004. "Dan brings a broad base of financial experience to this position," said Liddell. "It is a critical time in this company's history and Dan's depth of knowledge of the financial community and our business will be invaluable." Mr. Ammann will lead the GM Treasurer's Office, based in New York, with additional operations in Detroit, Shanghai, and Zurich. The global treasury operations include capital markets activities, capital planning, business development, risk management, worldwide pension funding, worldwide banking, and overseas and domestic finance. During his 11 years at Morgan Stanley, Mr. Ammann was instrumental in many high profile assignments spanning a variety of technology, service, and manufacturing clients. His diverse experience in mergers, acquisitions, raising capital, and restructuring includes leading Morgan Stanley's banking team in advising GM on its restructuring and sale pursuant to Section 363 of the U.S. Bankruptcy Code. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2009, GM had US$107.45 billion in total assets against US$135.60 billion in total liabilities. About Motors Liquidation 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) GENTA INC: Arcus Ventures Holds 9.9% of Common Stock ---------------------------------------------------- Arcus Ventures Fund, L.P.; Arcus Ventures Management, LLC, the general partner of Arcus Ventures Fund; James B. Dougherty, a member of Arcus Ventures Management; and Steven Soignet, a member of Arcus Ventures Management, disclosed that they may be deemed to beneficially own in the aggregate 23,315,632 shares or roughly 9.9% of the common stock of Genta Incorporated. The 23,315,632 shares consist of 80,500 shares of Genta Common Stock, 22,012,941 shares of Common Stock currently issuable upon the conversion of Genta's September 2009 Note and 1,222,191 shares of common stock issuable upon conversion of Genta's January 2010 Note. Arcus Venture Fund also disclosed that it held as of March 16, 2010 (i) warrants that are currently exercisable -- October 2009 Warrants -- to purchase 562,500 shares of Common Stock, (ii) warrants that are currently exercisable -- January 2010 Warrants - - to purchase 202,500 shares of Common Stock, (iii) warrants that are currently exercisable -- March 2010 Warrants -- to purchase 1,145,804 shares of Common Stock, (iv) purchase rights that are currently exercisable -- December 2008 Purchase Rights -- to acquire 77,812,500 shares of Common Stock and (v) purchase rights that are currently exercisable -- October 2009 Purchase Rights -- to acquire 22,500,000 shares of Common Stock; however, each of the October 2009 Warrants, the January 2010 Warrants, the March 2010 Warrants, the December 2008 Purchase Rights and the October 2009 Purchase Rights contains a limitation on exercise which prevents Arcus Venture from such exercise if, after giving effect to the exercise, Arcus Venture et al. would in the aggregate beneficially own more than 4.99% of the outstanding shares of Common Stock. Therefore, Arcus Venture et al. cannot exercise any of the October 2009 Warrants, the January 2010 Warrants, the March 2010 Warrants, the December 2008 Purchase Rights and the October 2009 Purchase Rights and, accordingly, do not beneficially own underlying shares of Common Stock if such ownership would cause Arcus Venture et al.'s beneficial ownership of Common Stock to exceed 4.99%. On March 9, 2010, Arcus Venture et al. acquired from the Company units consisting of: (i) a promissory note that will become convertible on September 9, 2010 into 28,000,000 shares of Common Stock -- B Note; (ii) a promissory note that will become convertible on September 9, 2010 into 28,000,000 shares of Common Stock -- C Note; (iii) a promissory note that will become convertible on September 9, 2010 into 14,000,000 shares of Common Stock -- D Note; and (iv) a purchase warrant -- March 2010 Purchase Warrant -- that is currently convertible into a promissory note -- E Note -- that would be convertible into 28,000,000 shares of Common Stock. Each of the B Note, the C Note, the D Note and the March 2010 Purchase Warrant contains a limitation on exercise which prevents Arcus Venture et al. from such exercise if, after giving effect to the exercise, Arcus Venture et al. would in the aggregate beneficially own more than 9.99% of the outstanding shares of Common Stock. Therefore, Arcus Venture et al. cannot exercise any of the B Note, the C Note, the D Note and the March 2010 Purchase Warrant and, accordingly, do not beneficially own underlying shares of Common Stock if such ownership would cause Arcus Venture et al.'s beneficial ownership of Common Stock to exceed 9.99%. About Genta Incorporated Berkeley Heights, New Jersey-based Genta Incorporated is a biopharmaceutical company engaged in pharmaceutical (drug) research and development, its sole reportable segment. The Company is dedicated to the identification, development and commercialization of novel drugs for the treatment of cancer and related diseases. As reported by the Troubled Company Reporter on December 7, 2009, Genta has said its recurring losses and negative cash flows from operations raise substantial doubt about its ability to continue as a going concern. With no further financing, management projects that the Company will run out of funds in the second quarter of 2010. The Company has said it will require additional cash to maximize its commercial opportunities and continue its clinical development opportunities. If the Company is unable to raise additional funds, it could be required to reduce its spending plans, reduce its workforce, license one or more of its products or technologies that it would otherwise seek to commercialize itself, sell certain assets, cease operations, or declare bankruptcy. At September 30, 2009, the Company had total assets of $18,853,000 against total current liabilities of $12,013,000 and total long- term liabilities of $3,346,000, resulting in stockholders' equity of $3,494,000. GENTA INC: Boxer Capital Holds 9.99% of Common Stock ---------------------------------------------------- Boxer Capital, LLC; Boxer Asset Management Inc.; Joseph Lewis, and MVA Investors II, LLC, disclosed that as of March 9, 2010, they may be deemed to beneficially own in the aggregate 21,075,779 Common Shares of Genta Incorporated, which constitute 9.999% of a notional number of Genta's outstanding Common Shares -- based on a calculation of (i) 191,810,882 shares outstanding as of December 16, 2009, as reported in Genta's Prospectus filed with the SEC on December 23, 2009 and (ii) 21,075,779 Common Shares underlying currently convertible Notes held by Boxer et al. Boxer Capital, Boxer Management and Joseph Lewis own $445,626.40 principal amount of Genta's July 2011 Notes and $120,371.47 principal amount of Genta's September 2011 Notes. MVA owns $106,154.60 principal amount of the July 2011 Notes and $32,941.16 principal amount of the September 2011 Notes. Boxer Management is the managing member and majority owner of Boxer Capital. Joseph Lewis is the sole indirect owner and controls Boxer Management. MVA is the independent, personal investment vehicle of certain employees of Boxer Capital and Tavistock Life Sciences Company, which is a Delaware corporation and an affiliate of Boxer Capital. MVA is not controlled by Boxer Capital, Boxer Management and Joseph Lewis. About Genta Incorporated Berkeley Heights, New Jersey-based Genta Incorporated is a biopharmaceutical company engaged in pharmaceutical (drug) research and development, its sole reportable segment. The Company is dedicated to the identification, development and commercialization of novel drugs for the treatment of cancer and related diseases. As reported by the Troubled Company Reporter on December 7, 2009, Genta has said its recurring losses and negative cash flows from operations raise substantial doubt about its ability to continue as a going concern. With no further financing, management projects that the Company will run out of funds in the second quarter of 2010. The Company has said it will require additional cash to maximize its commercial opportunities and continue its clinical development opportunities. If the Company is unable to raise additional funds, it could be required to reduce its spending plans, reduce its workforce, license one or more of its products or technologies that it would otherwise seek to commercialize itself, sell certain assets, cease operations, or declare bankruptcy. At September 30, 2009, the Company had total assets of $18,853,000 against total current liabilities of $12,013,000 and total long- term liabilities of $3,346,000, resulting in stockholders' equity of $3,494,000. GREEKTOWN HOLDINGS: Noteholders Oppose to Case Closing This Month ----------------------------------------------------------------- The Noteholder Plan Proponents, including the Official Committee of Unsecured Creditors, in a March 18, 2010 court filing, expressed their objection to a closing of the Chapter 11 cases of Greektown Holdings LLC and its debtor affiliates within this month. The Noteholder Plan Proponents consist of (i) certain noteholders, which include Manulife Global Fund U.S. Bond Fund, John Hancock II Strategic Income Fund, and Oppenheimer Strategic Income Fund, and Sola Ltd.; (ii) the Official Committee of Unsecured Creditors; and (ii) Deutsche Bank Trust Company Americas, as indenture trustee for senior notes due 2013 issued by the Debtors. As previously reported, the U.S. Bankruptcy Court for the Eastern District of Michigan issued a "Notice of Confirmation and Opportunity to Object to the Closing of the Case" dated January 22, 2010, indicating that it would close the Debtors' Chapter 11 cases within 60 days or on or about March 23, 2010, unless an objection is filed within that time. Allan S. Brilliant, Esq., at Dechert LLP, in New York -- abrilliant@dechert.com -- asserts that the Noteholder Plan Proponents are working diligently to consummate the Noteholder Plan as expeditiously as possible and have already satisfied certain of the conditions precedent to plan consummation. He adds that the Noteholder Plan Proponents are on track to achieve consummation of the Noteholder Plan before June 30, 2010. Mr. Brilliant, however, points out that certain regulatory approvals remain outstanding and will not likely occur before the 60-day deadline set by the Court. By their objection, the Noteholder Plan Proponents seek to keep the Debtors' Chapter 11 cases open for an indefinite period of time in order to enable them to accomplish all the tasks that, by the terms of the Noteholder Plan, will remain to be completed even after the Plan Effective Date and for which the Court will retain jurisdiction. Mr. Brilliant contends that the Parties are still actively pursuing required regulatory approvals from the City of Detroit and the Michigan Gaming Control Board. Those approvals, he avers, require more than 60 days to be completed. In addition, Mr. Brilliant points out that even after the occurrence of the Effective Date, many matters required or contemplated under the Noteholder Plan will remain outstanding, necessitating that the cases remain open for an additional time. Among others, he notes that various deadlines under the Noteholder Plan are triggered from the Effective Date, which include (i) the Administrative Claims Bar Date, which is 45 days after the Effective Date, and (ii) the time for the Reorganized Debtors and the Litigation Trust created under the Plan to object to claims, which is within 180 days after the Effective Date. Activities related to claim reconciliation and objections are ongoing and will continue for more than 60 days from confirmation, he adds. Moreover, the "Bond Avoidance Action Claims" have not yet been commenced, Mr. Brilliant says. Against this backdrop, the Noteholder Plan Proponents aver that they object to the closing of the Debtors' cases at this time. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC, and its affiliates -- http://www.greektowncasino.com/-- operates world-class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The Company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC as claims, noticing, and balloting agent. Clark Hill PLC serves as counsel to the Official Committee of Unsecured Creditors. Greektown Holdings listed assets and debts of $100 million to $500 million in its bankruptcy petition. Bankruptcy Creditors' Service, Inc., publishes Greektown Casino Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Greektown Casino and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GREEKTOWN HOLDINGS: Settlement with City of Detroit Approved ------------------------------------------------------------ Greektown Holdings Inc. and its units, the noteholders who were proponents to their court-confirmed Plan, the Official Committee of Unsecured Creditors, and the City of Detroit obtained approval from the Bankruptcy Court to enter into an amended settlement agreement they reached among themselves, which provides a resolution of all the outstanding disputes between the Debtors and the City, including disputes relating to (i) the Debtors' Development Agreement with the City and the assumption of that Agreement, (ii) a certain Tax Rollback, and (iii) the City's reservation of rights in the Court's order confirming the Noteholder Proponents' Chapter 11 Plan for the Debtors. The Tax Rollback refers a rollback of the wagering tax pursuant to the Michigan Gaming Control and Revenue Act and other applicable law, effective as of February 15, 2009. The Rollback may be granted by the Michigan Gaming Control Board. The Debtors, Merrill Lynch Capital Corporation, as administrative agent for the prepetition lenders and the DIP lenders, and the City of Detroit previously asked Judge Shapero to approve a settlement agreement that aims to resolve issues among them in November 2009. The Original Settlement, however, was not supported by the Creditors Committee; Deutsche Bank Trust Company Americas, as indenture trustee for senior notes due 2013 issued by Greektown Holdings and Greektown Holdings II; and MFC Global Investment Management (U.S.) LLC. In addition, the Original Settlement was rejected by the Detroit City Council. The Parties assert that the Amended Settlement is fair and reasonable; is in the best interests of the Debtors, their estates, and creditors; and should be approved by the Court in its entirety. Representing the Noteholder Plan Proponents, Allan S. Brilliant, Esq., at Dechert LLP, in New York, avers that the terms of the Amended Settlement are substantially similar to those under the Original Settlement Agreement, except for certain modifications which make the Settlement more favorable to the Debtors and certain modifications to the amounts owed to the City. He tells the Court that after the entry of the Noteholder Plan Confirmation Order, the Noteholder Plan Proponents engaged in arm's-length negotiations with the City, which ultimately culminated in the execution of the Amended Settlement. Moreover, the City Council voted to accept the Settlement on February 4, 2010. The salient terms of the Amended Settlement are: -- The Amended Settlement is conditioned on obtaining Court approval for the pact on or before February 22, 2010 and consummation of the Noteholder Plan. In the event the Noteholder Plan is not consummated or the Court does not approve the Amended Settlement, it will be deemed null and void. -- As consideration for the release and settlement of all disputed matters among the parties, the Debtors agree to pay to the City $16,629,000, subject to certain provisions and payable in this manner: * A $3,500,000 initial cash payment to be paid within two business days of the entry of the order approving the Amended Settlement; * A credit, to be applied at the time of the Final Cash Payment to reduce the Settlement Payment, in an amount equal to $3,529,000, which represents the difference between (i) the amount of gaming taxes paid by the Debtors to the City between February 15, 2009 and February 15, 2010, and (ii) the amount that would have been paid by the Debtors between February 15, 2009 and February 15, 2010 had the Tax Rollback been effective as of February 15, 2009; and * A final cash payment of $9,600,000, which represents the Settlement Payment, less the sum of (i) the amount of the Initial Cash Payment, and (ii) the amount of the Tax Rollback Credit. The Final Cash payment will be paid within two business days on the earlier of (i) the effective date of the Noteholder Plan, and (ii) certain conditions set forth in the Settlement having been met. -- These parties also agree to perform these actions: * The City will make no further demand to seek a 1% tax Increase. On the date of the Final Cash Payment, the City will acknowledge and agree that the Tax Increase is neither applicable nor payable. * The City will dismiss the Adversary Proceeding it initiated against the Debtors relating to the Development Agreement and the related Appeal with prejudice, and will waive any and all claims of default under the Development Agreement. * The City will not take any actions inconsistent with, and will use its best efforts to support and cooperate publicly and actively with the Debtors' efforts to obtain the Tax Rollback. * To the extent any consent is required under any applicable law, contract, or otherwise, the City will consent to the transfer of the ownership of the Casino and the Development Agreement, whichever is in effect, to the Reorganized Debtors on the terms and in accordance with the Noteholder Plan. * The City will issue all appropriate certificates of occupancy, permits, zoning approval or variance or other similar regulatory approvals as contemplated by or required under the Development Agreement, including, but not limited to, approvals for the revised site plan based on drawings dated July 27, 2009, that were previously submitted to the City showing the Event Center as white box space, a revised building permit and a final certificate of occupancy based on the revised building permit. * In the event the Reorganized Debtors offer to sell shares to the public in an underwritten public offering within three years of the Plan Effective Date, to the extent permitted by any rules and regulations regulating the Reorganized Debtors or the underwriters of the offering, the Reorganized Debtors will recommend to the underwriters of the offering to allow City of Detroit residents to participate in a "directed share program," limited to 5% of the total offering and will consider, in their sole discretion, whether to ask that the underwriters, as to the 5% portion of the "directed share program," offer the directed shares to the directed share recipients at the discount price at which the underwriter purchases the shares. -- The Amended Settlement provides the parties with a limited mutual release from all claims relating to any disputed matter or dispute proceeding. Mr. Brilliant summarizes the provisions that represent the significant differences between the Amended Settlement and the Original Settlement Agreement: (a) The Economic Development Corporation of the City of Detroit is not a party to the Amended Settlement and the provisions in the Original Settlement Agreement that inure to its benefit or require EDC's consent are stricken. (b) The Parties agree on the composition and members of the Reorganized Debtors board of directors and its management Company. They further agree that either: (i) at least one Board member will be from Detroit and be reasonably acceptable to the Mayor and City Council; or (ii) an unpaid ombudsman would be appointed to be selected by the Mayor and approved by the City Council and who is reasonably acceptable to the Reorganized Debtors. (c) The Reorganized Debtors secured debt ceiling increased from $350,000,000 to $450,000,000. (d) The Settlement no longer contains a requirement that Greektown Casino, the City and the EDC enter into a Revised Development Agreement, which, in the Original Settlement Agreement, was to amend and supersede in all respects the Development Agreement. (e) Payment of all development costs, as defined in the Development Agreement, incurred by the City from Jan. 1, 2010, through and including the Effective Date of the Noteholder Plan. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC, and its affiliates -- http://www.greektowncasino.com/-- operates world-class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The Company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC as claims, noticing, and balloting agent. Clark Hill PLC serves as counsel to the Official Committee of Unsecured Creditors. Greektown Holdings listed assets and debts of $100 million to $500 million in its bankruptcy petition. Bankruptcy Creditors' Service, Inc., publishes Greektown Casino Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Greektown Casino and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GREEKTOWN HOLDINGS: MGCB OKs Tax Rollback for Casino ---------------------------------------------------- The Michigan Gaming Control Board granted a tax rollback for Greektown Casino on March 9, 2010, according to The Detroit Free Press. The MGCB approved a rollback of the Casino's wagering tax rate to 19% retroactive to February 15, 2009, the report notes. A 24% wagering tax rate was previously imposed on the Casino. The tax rate rollback was issued upon the request of Greektown Casino and upon the MGCB's determination that the Casino has fulfilled the terms of its development agreement with the city of Detroit, which provided among others that the Casino build and operate a 400-room hotel, the report adds. In light of the Tax Rollback, Greektown Casino is expected to recover $18.5 million back, The Detroit Free Press' John Wisely relates. About $16 million of that amount will be used by the Casino to settle its disputes with the city of Detroit, he notes. The City has agreed to support the tax rollback request in return for the settlement payment. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC, and its affiliates -- http://www.greektowncasino.com/-- operates world-class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The Company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC as claims, noticing, and balloting agent. Clark Hill PLC serves as counsel to the Official Committee of Unsecured Creditors. Greektown Holdings listed assets and debts of $100 million to $500 million in its bankruptcy petition. Bankruptcy Creditors' Service, Inc., publishes Greektown Casino Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Greektown Casino and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GREEKTOWN HOLDINGS: Luna Wants Payment of Attorney's Fees --------------------------------------------------------- Luna Greektown LLC and Plainfield Asset Management LLC and its affiliates ask the Court to allow as administrative expenses a portion of the legal fees and costs incurred by Foley & Lardner LLP on their behalf during the period from July 1, 2009 through and including October 22, 2009 in connection with work related to the disclosure statements and bankruptcy plans the Luna Claimants submitted in the Debtors' Chapter 11 cases. The Luna Claimants seek $418,410 for Foley & Lardner's fees and expenses. The Firm notes that the total time it spent during the Fee Period was approximately 950.6 hours of legal services to the Luna Claimants for a total charge of $407,465 in fees and $10,945 in expenses. Salvatore A. Barbatano, Esq., at Foley & Lardner, in Detroit, Michigan -- sbarbatano@foley.com -- asserts that the Luna Claimants must be reimbursed because they have made a substantial contribution to the Debtors' Chapter 11 cases. He explains that the Luna Claimants' role was critical because it created a competitive bidding environment that shed light on licensing issues previously ignored by the parties and motivated the Noteholder Plan Proponents to develop a more viable exit scheme under a more reasonable timetable. "By submitting a competing Chapter 11 plan and disclosure statement, the Luna Claimants acted as a catalyst for a competitive bidding process and identified key deficiencies in the Debtors' [Chapter 11] plan," Mr. Barbatano says. Accordingly, Mr. Barbatano asserts that the efforts of the Luna Claimants constitute a "substantial contribution" to the Debtors' estates under Section 503(b)(3)(D) of the Bankruptcy Code and that their request for reimbursement should be approved as an administrative expense of the estates. Section 503(b)(3)(D) provides that the Court may allow, as an administrative expense, the payment of the expenses of a "creditor, an indenture trustee, an equity holder, or a committee representing creditors or equity holders other than a committee appointed under Section 1102 of this title, in making a substantial contribution in a case under Chapter 9 or 11 of this title." About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC, and its affiliates -- http://www.greektowncasino.com/-- operates world-class casino gaming facilities located in Detroit's historic Greektown district featuring more than 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The Company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08-53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC as claims, noticing, and balloting agent. Clark Hill PLC serves as counsel to the Official Committee of Unsecured Creditors. Greektown Holdings listed assets and debts of $100 million to $500 million in its bankruptcy petition. Bankruptcy Creditors' Service, Inc., publishes Greektown Casino Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Greektown Casino and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GUIDED THERAPEUTICS: Roth and Stark Hold Less Than 5% of Shares --------------------------------------------------------------- Michael A. Roth and Brian J. Stark disclosed that as of December 31, 2009, they may be deemed to hold less than 5% of the common stock of Guided Therapeutics Inc. About Guided Therapeutics Norcross, Georgia-based Guided Therapeutics, Inc. (Pink Sheets: GTHP) is a medical technology company focused on developing innovative medical devices that have the potential to improve health care. The Company is currently focused on completing the development of cervical cancer detection device. * * * At September 30, 2009, the Company had $1,385,000 in total assets against $12,694,000 in total liabilities, resulting in $11,309,000 in capital deficit. GUIDED THERAPEUTICS: SDS Capital Holds 5.32% of Common Stock ------------------------------------------------------------ SDS Capital Group SPC, Ltd., c/o Ogier Fiduciary Services (Cayman) Ltd., in George Town, Grand Cayman, Cayman Islands; SDS Management, LLC, as Investment Manager based in Old Greenwich, CT; and Steven Derby, Sole Managing Member of the Investment Manager, disclosed that as of December 31, 2009, they may be deemed to beneficially own 929,729 shares or roughly 5.32% of Guided Therapeutics, Inc. About Guided Therapeutics Norcross, Georgia-based Guided Therapeutics, Inc. (Pink Sheets: GTHP) is a medical technology company focused on developing innovative medical devices that have the potential to improve health care. The Company is currently focused on completing the development of cervical cancer detection device. * * * At September 30, 2009, the Company had $1,385,000 in total assets against $12,694,000 in total liabilities, resulting in $11,309,000 in capital deficit. HAWAIIAN TELCOM: Gets OK to Pay Incentives to Union Employees ------------------------------------------------------------- Judge Lloyd King of the United States Bankruptcy Court for the District of Hawaii authorized Hawaiian Telcom Communications, Inc. and its debtor affiliates to make performance payments to about 845 unionized employees pursuant to the Debtors' 2009 annual compensation program on or before March 31, 2010. The confirmed Amended Joint Plan of Reorganization allows the Debtors to make payments of up to $8.5 million to employees pursuant to the 2009 Performance Compensation Program on the effective date of the Plan. As of March 26, 2010, the Amended Plan has not yet been declared effective. As previously reported, the Amended Plan will only be declared effective after the Debtors receive the necessary regulatory approvals. Hawaiian Telcom is currently working on obtaining from Hawaii Public Utilities Commission a regulatory approval, which could be handed down in five to eight months. About Hawaiian Telcom Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc. -- http://www.hawaiiantel.com/-- operates a telecommunications company, which offers an array of telecommunications products and services including local and long distance service, high-speed Internet, wireless services, and print directory and Internet directory services. The Company and seven of its affiliates filed for Chapter 11 protection on December 1, 2008 (Bankr. D. Del. Lead Case No. 08-13086). As reported by the TCR on December 30, 2008, Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware approved the transfer of the Chapter 11 cases to the U.S. Bankruptcy Court for the District of Hawaii before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005). Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in their restructuring efforts. The Debtors proposed Lazard Freres & Co. LLC as investment banker; Zolfo Cooper Management LLC as business advisor; Deloitte & Touche LLP as independent auditors; and Kurztman Carson Consultants LLC as notice and claims agent. An official committee of unsecured creditors has been appointed and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii. When the Debtors filed for protection from their creditors, they listed total assets of $1,352,000,000 and total debts of $1,269,000,000 as of September 30, 2008. Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Hawaiian Telcom Communications, Inc., and seven of its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) HAWAIIAN TELCOM: Zolfo Cooper's Fees Reeduced to $90,000 Per Month ------------------------------------------------------------------ Hawaiian Telcom Communications Inc. and its units obtained the Court's authority to enter into an Amendment No. 1 to the services agreement they entered with Zolfo Cooper Management, LLC, and Kevin Nystrom. As previously reported, the Debtors engaged Zolfo Cooper for the provision of services of Mr. Nystrom as the Debtors' chief restructuring officer and other professional staff to serve as the Debtors' associate directors for restructuring services. Pursuant to the Amendment, the parties agree to reduce Zolfo Cooper's monthly compensation from $225,000 to $90,000, effective January 1, 2010, and continuing through the term of the Agreement. A full-text copy of the Amendment No.1 to the Zolfo Cooper Agreement is available for free at: http://bankrupt.com/misc/HawTel_AmendmentNo1.pdf The Debtors believe that modification of Zolfo Cooper's engagement is necessary and beneficial to their estates. About Hawaiian Telcom Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc. -- http://www.hawaiiantel.com/-- operates a telecommunications company, which offers an array of telecommunications products and services including local and long distance service, high-speed Internet, wireless services, and print directory and Internet directory services. The Company and seven of its affiliates filed for Chapter 11 protection on December 1, 2008 (Bankr. D. Del. Lead Case No. 08-13086). As reported by the TCR on December 30, 2008, Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware approved the transfer of the Chapter 11 cases to the U.S. Bankruptcy Court for the District of Hawaii before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005). Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in their restructuring efforts. The Debtors proposed Lazard Freres & Co. LLC as investment banker; Zolfo Cooper Management LLC as business advisor; Deloitte & Touche LLP as independent auditors; and Kurztman Carson Consultants LLC as notice and claims agent. An official committee of unsecured creditors has been appointed and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii. When the Debtors filed for protection from their creditors, they listed total assets of $1,352,000,000 and total debts of $1,269,000,000 as of September 30, 2008. Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Hawaiian Telcom Communications, Inc., and seven of its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) HAWAIIAN TELCOM: Court OK's Kirkland's $2.61-Mil. Fees for Q4 ------------------------------------------------------------- Pursuant to Sections 330 and 331 of the Bankruptcy Code, the Bankruptcy Court approved the fee applications of five professionals for the fee period from October 1, 2009 through December 31, 2009: Professional Fees Expenses ------------ ---------- -------- Kirkland & Ellis LLP $2,613,584 $242,751 Morrison & Foerster LLP 1,674,431 183,926 Cades Schutte LLP 274,883 26,903 Deloitte & Touche LLP 243,362 0 Moseley Biehl Tsugawa Law & Muzzi LLLC 123,684 14,848 The Court also awarded Deloitte $21,995 for the State of Hawaii General Excise Tax, consisting of $11,467 for the period from October 1, 2009 to December 31, 2009; $860 for the period from April 1, 2009 to June 30, 2009; and $9,668 for the period from July 1, 2009 to September 30, 2009. The Court awarded Cades Schutte $14,111 for the State of Hawaii General Excise Tax for the period from October 1, 2009 to December 31, 2009. Kirkland & Ellis is the Debtors' lead counsel. Cades Schutte is the Debtors' co-counsel. Deloitte & Touche acts as the Debtors' auditor. Morrison & Foerster acts as lead counsel to the Official Committee of Unsecured Creditors while Moseley Biehl serves as the Committee's co-counsel. In another filing, Zolfo Cooper Management LLC seeks payment of fees for $225,000 and reimbursement of expenses for $983 for the period from October 1, 2009 to December 31, 2009. Zolfo also seeks payment of State of Hawaii General Excise Tax for $10,602. The Debtors engaged Zolfo for the provision of Kevin Nystrom as their chief restructuring officer. The Law Offices of Gregory J. Vogt, PLLC, also seeks payment of $44,475 in fees and reimbursement of $414 in expenses for the month of January 2010. Gregory Vogt serves as special counsel to the Debtors. Judge King approved FTI Consulting, Inc.'s final fee application and awarded the firm $2,438,710 in fees and $153,840 in expenses for the period from December 12, 2008 to December 18, 2009. FTI is financial advisor to the Official Committee of Unsecured Creditors. Lazard Defends Fees Meanwhile, in response to the U.S. Trustee's objection to its fee applications, Lazard Freres & Co. LLC argues that its fees are "market" and are reasonable under Sections 328 and 330 of the Bankruptcy Code. Counsel to Lazard Freres, Elizabeth A. Kane, Esq., at Law Office of Elizabeth A. Kane, LLC, in Honolulu, Hawaii -- ekane@aloha.net -- asserts that Lazard was instrumental in assisting confirmation of the Debtors' Amended Joint Chapter 11 Plan of Reorganization. The testimony of Lazard's two confirmation witnesses, Nick Melton and Suneel Mandava, was valuable to confirmation, she maintains. Ms. Kane points out the Court specifically concluded that Mr. Melton's valuation analysis was more persuasive than the other valuation witnesses. The Court also found, she adds, that Mr. Mandava's application of the Black Scholes analysis was correct in assessing the warrants proposed under the Plan. Ms. Kane also asserts that U. S. Trustee for Region 15 Tiffany Carroll's arguments regarding Lazard's diminished role because the Plan did not involve new buyers or investors are baseless. Lazard ran an extensive search and succeeded in locating interested buyers, however, based on the potential buyers' formal and informal indications of interest, the restructuring plan developed with the Debtors' secured lenders maximized value for the Debtors' estates, Ms. Kane points out. Lazard, she adds, also performed all the necessary services and ran the processes to enable the Debtors and creditors to decide on the appropriate resolution of the Debtors' Chapter 11 cases. In connection with the U.S. Trustee's request to review invoices for legal expenses incurred by Lazard, those invoices have been provided to the U.S. Trustee, Ms. Kane says. Over half of those expenses relate to the legal expenses Lazard incurred in connection with plan confirmation discovery and hearings and the remaining expenses relate to the retention matters that were raised in the Debtors' Chapter 11 cases, she relates. About Hawaiian Telcom Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc. -- http://www.hawaiiantel.com/-- operates a telecommunications company, which offers an array of telecommunications products and services including local and long distance service, high-speed Internet, wireless services, and print directory and Internet directory services. The Company and seven of its affiliates filed for Chapter 11 protection on December 1, 2008 (Bankr. D. Del. Lead Case No. 08-13086). As reported by the TCR on December 30, 2008, Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware approved the transfer of the Chapter 11 cases to the U.S. Bankruptcy Court for the District of Hawaii before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005). Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in their restructuring efforts. The Debtors proposed Lazard Freres & Co. LLC as investment banker; Zolfo Cooper Management LLC as business advisor; Deloitte & Touche LLP as independent auditors; and Kurztman Carson Consultants LLC as notice and claims agent. An official committee of unsecured creditors has been appointed and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii. When the Debtors filed for protection from their creditors, they listed total assets of $1,352,000,000 and total debts of $1,269,000,000 as of September 30, 2008. Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Hawaiian Telcom Communications, Inc., and seven of its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) INDALEX INC: Buyer Won't Assume Pension Plan; PBGC Steps In ----------------------------------------------------------- The Pension Benefit Guaranty Corporation has assumed responsibility for four underfunded pension plans covering nearly 3,100 former workers and retirees of Indalex Inc., a maker of alloy extrusion products in Lincolnshire, Ill. The PBGC stepped in because the pension plans faced abandonment after the company sold substantially all of its assets while in bankruptcy proceedings. The buyer is unwilling to assume responsibility for the plans. Retirees and beneficiaries will continue to receive their monthly benefit checks without interruption, and other participants will receive their pensions when they are eligible to retire. The plans are: * Indalex USA Pension Plan * Pension Plan for Employees of Aluminum Industry & Allied Industries of the Greater Youngstown, Ohio, Metropolitan Area -- Indalex, Inc.- Girard * Pension Plan for Employees of Aluminum Industry & Allied Industries of the Greater Youngstown, Ohio, Metropolitan Area -- Indalex, Inc. -- Niles Extrusion * Pension Plan for Employees of Aluminum Industry & Allied Industries of the Greater Youngstown, Ohio, Metropolitan Area -- Indalex, Inc. -- Niles Casting Collectively, the plans are 57% funded with $62.4 million in assets to cover $109.8 million in benefit liabilities. The agency will be responsible for $47.1 million of the $47.4 million shortfall. Within the next several weeks, the PBGC will send notification letters to all participants in Indalex plans. Under provisions of the Pension Protection Act of 2006, the maximum guaranteed pension the PBGC can pay is determined by the legal limits in force on the date of the plan sponsor's bankruptcy. Therefore participants in the plan are subject to the limits in effect when Indalex filed for bankruptcy protection on March 20, 2009, which set a maximum guaranteed amount of $54,000 a year for a 65-year-old. The agency became trustee of the plans on March 23, 2010. The maximum guaranteed amount is lower for those who retire earlier or elect survivor benefits. In addition, certain early retirement subsidies and benefit increases made within the past five years may not be fully guaranteed. Indalex filed for Chapter 11 protection in the U.S. Bankruptcy Court in Wilmington, Del., because of financial difficulties brought on by the global economic slowdown, which spurred a drop in demand, earnings, and liquidity. On July 2, 2009, the company's sale to Sapa holdings AB, a Swedish aluminum products maker, was approved. The transaction included 10 active plants in North America. Workers and retirees with questions may consult the PBGC Web site, http://www.pbgc.gov/or call toll-free at 1-800-400-7242. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask for 800-400-7242. Indalex retirees who draw a benefit from the PBGC may be eligible for the federal Health Coverage Tax Credit. Further information may be found on the PBGC Web site at http://www.pbgc.gov/workers- retirees/benefits-information/content/page13692.html Assumption of the plan's unfunded liabilities will increase the PBGC's claims by $47.1 million and was not previously included in the agency's fiscal year 2009 financial statements. The PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits earned by 44 million American workers and retirees participating in over 29,000 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by investment returns. INTERNATIONAL COAL: Amends Terms of Tender Offer for 9% Notes ------------------------------------------------------------- International Coal Group, Inc., has filed Amendment No. 2 to amend and supplement the terms of the issuer tender offer statement on Schedule TO the Company filed with the Securities and Exchange Commission on March 8, 2010. The Schedule TO relates to the offer by the Company to purchase for cash any and all of its outstanding 9.00% Convertible Senior Notes due 2012 upon the terms and subject to the conditions set forth in the Offer to Purchase, dated March 8, 2010, and in the related Letter of Transmittal. On March 18, 2010, International Coal announced certain amendments to its cash tender offer for any and all of the $139.5 million aggregate principal amount of its outstanding 9.00% Convertible Senior Notes due 2012 (CUSIP Nos. 45928HAD8, 45928HAE6). The principal amendments to the tender offer are to: (1) change the Pricing Date from April 5, 2010 to April 1, 2010 and eliminate various tender and withdrawal procedures and information deliveries that were related to a Pricing Date of April 5, 2010; (2) clarify that the daily volume-weighted average price of the Company's common stock is calculated by reference to all trades of the common stock reported on Bloomberg Financial Services during the applicable measurement period and not just trades of the common stock on the New York Stock Exchange and (3) report the closing of the Company's concurrent offerings of convertible notes and common stock, which satisfied the refinancing condition to the tender offer. The expiration time of the tender offer has not been extended and remains midnight, New York City time, on April 5, 2010, unless extended or earlier terminated by the Company. To be eligible to receive the purchase price for tendered Convertible Notes, holders must validly tender and not validly withdraw their Convertible Notes at or prior to the Expiration Time. The Company has engaged UBS Investment Bank and Morgan Stanley as Dealer Managers for the tender offer. Persons with questions regarding the tender offer should contact UBS Investment Bank toll-free at (888) 719-4210 or collect at (203) 719-4210 or Morgan Stanley toll-free at (800) 624-1808 or collect at (212) 761-5384. Requests for documents should be directed to D. F. King & Co., Inc., the Information Agent and Depositary for the tender offer, at (212) 269-5550 (banks and brokers) or (800) 431-9633 (all others). A full-text copy of Amendment No. 2 is available at no charge at http://ResearchArchives.com/t/s?5cb4 A full-text copy of Amendment No. 1 is available at no charge at http://ResearchArchives.com/t/s?5cb5 Scott Depot, West Virginia-based International Coal Group, Inc. (NYSE: ICO) produces coal in Northern and Central Appalachia and the Illinois Basin. The Company has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia, and one in Central Illinois. ICG's mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers throughout the eastern United States. * * * As reported by the Troubled Company Reporter on March 11, 2010, Standard & Poor's Ratings Services raised its corporate credit rating on International Coal Group LLC to 'B+' from 'B-'. The TCR on March 10, 2010, Moody's Investors Service affirmed the ratings of International Coal Group, including the corporate family rating of Caa1. Moody's assigned a Caa1 (LGD 4; 57%) rating to the company's new $200 million second lien senior secured notes due 2018. The rating outlook remains stable. INTERSTATE HOTELS: Moody's Confirms 'Caa1' Corporate Family Rating ------------------------------------------------------------------ Moody's Investors Service confirms and will withdraw the Caa1 corporate family rating of Interstate Hotels & Resorts. Interstate is the largest US independent hotel management company which also has ownership interests in a number of hotel properties. Moody's will withdraw these ratings because Interstate has been acquired by a 50/50 joint venture between subsidiaries of Thayer Hotel Investors V-A LP, a private equity fund sponsored by Thayer Lodging Group, and Shanghai Jin Jiang International Hotels (Group) Company Limited. Thayer Lodging, founded in 1991, is a leading private equity sponsor that invests exclusively in the lodging sector. Jin Jiang Hotels is the world's 13th largest hotel company in terms of number of rooms according to Hotels Magazine. Moody's last rating action on Interstate Hotels & Resorts was on December 18, 2009, when Moody's placed the ratings under review direction uncertain following the announcement of the expected acquisition. Interstate Hotels & Resorts is based in Arlington, Virginia, USA and has ownership interests in 56 hotels and resorts, including seven wholly-owned assets. Together with these properties, the company and its affiliates manage a total of 224 hospitality properties with over 45,000 rooms in 37 states, the District of Columbia, Russia, Mexico, Belgium, Canada and Ireland. IRVINE SENSORS: Inks Subscription Deals with 55 Creditors --------------------------------------------------------- Irvine Sensors Corporation entered into a Subscription Agreement with seven accredited investors, pursuant to which the company sold and issued to the investors an aggregate of 16.50 "Units" for $99,000 in cash. In addition, the Company also entered into a Subscription Agreement with 48 accredited investors, pursuant to which the Company sold and issued to the Investors an aggregate of 258.72 convertible debenture units at a purchase price of $6,000 per Unit in an initial closing of a private placement. The $1,552,300 aggregate purchase price for these Units was paid in cash to the Company. Each Unit is comprised of (i) one one-year, unsecured convertible debenture with a principal repayment obligation of $5,000 that is convertible at the election of the holder into shares of the Company's Common Stock at the conversion price; (ii) one one-year, unsecured non-convertible debenture with a principal repayment obligation of $5,000 that is not convertible into Common Stock; and (iii) a five-year warrant to purchase 3,125 shares of the Company's Common Stock. $3,000 of the Unit Price was paid for each Convertible Debenture and $3,000 of the Unit Price was paid for each Non-Convertible Debenture. The conversion price applicable to the Debentures and the exercise price applicable to the Investor Warrants is $0.40 per share, which was greater than the last consolidated closing bid price of the Company's Common Stock as determined in accordance with Nasdaq rules immediately preceding the Company entering into the applicable binding Subscription Agreement. The Debentures bear simple interest at a rate per annum of 20% of their original principal value. Interest on the Debentures accrues and is payable quarterly in arrears and is convertible at the election of the Company into shares of Common Stock at the conversion price. The conversion price of the Debentures is subject to adjustment for stock splits, stock dividends, recapitalizations and the like. Unpaid and unconverted principal value of the Debentures may be repaid in cash prior to maturity at 110% of such principal value. The amounts owing under the Debentures may be accelerated upon the occurrence of certain events of default, such as the termination of existence of the Company, the appointment of a receiver or custodian for the Company or any part of its property if such appointment is not terminated or dismissed within thirty days, the institution against the Company or the voluntary commencement by the Company of any proceedings under the United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership or other similar law affecting the rights of creditors generally which proceeding is not dismissed within sixty days of filing, the failure to pay interest on the Debentures, or an assignment by the Company for the benefit of its creditors or an admission in writing by the Company of its inability to pay its debts as they become due. The total number of shares of Common Stock issuable upon conversion of the principal and interest under the Debentures at the conversion price is 4,816,290 in the aggregate. The total number of shares of Common Stock issuable upon exercise of the Investor Warrants at the exercise price is 860,047 in the aggregate. The Company may at its option expand this Private Placement. In consideration for services rendered as the lead placement agent in the Private Placement, on March 18, 2010, the Company paid the placement agent cash commissions, a management fee and an expense allowance fee aggregating $201,799, which represents 13% of the gross proceeds of the initial closing of the Private Placement, and issued to the placement agent a five-year warrant to purchase an aggregate of 504,497 shares of the Company's Common Stock at an exercise price of $0.40 per share and, as a retainer, a five-year warrant to purchase an aggregate of 450,000 shares of the Company's Common Stock at an exercise price of $0.40 per share, which was greater than the last consolidated closing bid price of the Company's Common Stock as determined in accordance with Nasdaq rules immediately preceding the Company entering into such warrants. In consideration for services rendered as the lead placement agent in the Private Placement, on March 24, 2010, the Company paid the placement agent cash commissions, a management fee and an expense allowance fee aggregating $12,870, which represents 13% of the gross proceeds of the second closing of the Private Placement, and issued to the placement agent a five-year warrant to purchase an aggregate of 32,175 shares of the Company's Common Stock at an exercise price of $0.40 per share, which was greater than the last consolidated closing bid price of the Company's Common Stock as determined in accordance with Nasdaq rules immediately preceding the Company entering into such warrant. The warrants issued to the placement agent are referred to in this report collectively as the "Agent Warrants." The Investor Warrants and Agent Warrants may be exercised in cash or pursuant to a net exercise provision if the Company does not register the shares of Common Stock issuable upon exercise of the Investor Warrants or Agent Warrants on or prior to the six-month anniversary of the issuance date of the warrants. The exercise price of the Investor Warrants and the Agent Warrants is subject to adjustment for stock splits, stock dividends, recapitalizations and the like. The Debentures, Investor Warrants and Agent Warrants also are subject to a blocker that would prevent each holder's Common Stock ownership at any given time from exceeding 4.99% of the Company's outstanding Common. None of the Units, Debentures, Investor Warrants or Agent Warrants, or the Common Stock issuable upon conversion or exercise thereof, has been registered under the Securities Act of 1933 and none may be offered or sold absent registration or an applicable exemption from registration. The Company does not plan to register the Units, Debentures, Investor Warrants or Agent Warrants, or the Common Stock issuable upon conversion or exercise thereof. The number of shares of the Company's Common Stock outstanding immediately after the second closing of the Private Placement was 15,875,316 shares. About Irvine Sensors Irvine Sensors Corporation -- http://www.irvine-sensors.com/-- headquartered in Costa Mesa, California, is a vision systems company engaged in the development and sale of miniaturized infrared and electro-optical cameras, image processors and stacked chip assemblies and sale of higher level systems incorporating such products and research and development related to high density electronics, miniaturized sensors, optical interconnection technology, high speed network security, image processing and low- power analog and mixed-signal integrated circuits for diverse systems applications. Optex Systems, Inc., a Texas corporation and a wholly owned subsidiary of Irvine Sensors, on September 21, 2009, filed a voluntary petition for relief under Chapter 7 of the United States Bankruptcy Code in the United States Bankruptcy Court in California. Irvine Sensors reported assets of $5.23 million and $9.23 million, resulting to a $4.0 million stockholders' deficit at the end of the quarterly period ended December 27, 2009. Irvine Sensors received a Nasdaq Staff Determination on March 16, 2010, indicating that the Company has not regained compliance with the $1.00 minimum bid price requirement for continued listing set forth in Nasdaq Marketplace Rule 5550(a)(2), and that the Company's securities are, therefore, subject to delisting from The Nasdaq Capital Market. JOHN HENRY: Moody's Assigns 'B2' Rating on $245 Million Loan ------------------------------------------------------------ Moody's Investors Service assigned a B2 rating to the proposed $245 million first lien credit facility of John Henry Holdings, Inc., a wholly-owned subsidiary of Multi Packaging Solutions, Inc. Concurrently, the B2 Corporate Family Rating and the ratings on the existing first and second lien debt were affirmed. The ratings outlook remains stable. The proposed $245 million first lien credit facility will be comprised of a five-year $30 million revolver (expected to be undrawn at close) and a six-year $215 million term loan. The new credit facility and cash on hand will be used to refinance the existing first and second lien debt, redeem the mezzanine notes, and fund an $80 million dividend to the holders of JHH's preferred stock. The recapitalization is anticipated to increase reported debt by approximately $47 million. On a pro forma basis as of March 31, 2010, management estimates financial leverage will rise to 3.7 times from 2.9 times. Despite taking capital out of the company, JHH's credit metrics and liquidity profile are expected to support the B2 Corporate Family Rating over the intermediate term. Recent operating results have mostly met expectations in the face of a difficult macroeconomic environment, highlighting the recession-resistant nature of a number of JHH's products (e.g. pharmaceutical consumer products). Recent acquisitions appear to have been successfully integrated and management has executed on synergies and operating improvements. Furthermore, cash flow is expected to remain solid and the new credit facility will improve JHH's debt maturity schedule. Still, almost the entire cash balance will be utilized to fund the proposed recapitalization and the ratings are constrained by JHH's relatively small revenue size, acquisitive nature and equity-friendly financial policies. The B2 CFR reflects a higher than average expected recovery rate and a higher probability of default as a result of the change to an all first-lien debt capital structure, in accordance with Moody's Loss Given Default methodology. As such, the Probability of Default Rating was lowered to B3 from B2. The ratings are subject to the conclusion of the proposed transaction and Moody's review of final documentation. Upon completion of the recapitalization, the ratings on the existing first and second lien credit facilities will be withdrawn. Moody's assigned these ratings to John Henry Holdings, Inc.: -- $30 million proposed first lien revolver due 2015, B2 (LGD3, 35%); -- $215 million proposed first lien term loan due 2016, B2 (LGD3, 35%). Moody's lowered this rating: -- Probability of Default Rating, to B3 from B2 Moody's affirmed these ratings: -- Corporate Family Rating, B2; -- $30 million first lien senior secured revolver due 2011, B1 (LGD3, 36%); -- $99 million first lien senior secured term loan due 2012, B1 (LGD3, 36%); -- $22 million second lien senior secured term loan due 2012, B3 (LGD5, 76%). The last rating action on JHH occurred on March 20, 2008, when Moody's affirmed the B2 CFR and upgraded the bank debt ratings after junior ranking debt was added to the capital structure. The most recent Issuer Comment, published on April 13, 2009, announced that JHH's ratings were unchanged following an acquisition. John Henry Holdings, Inc., is a leading print and packaging company for the healthcare, horticultural, media, and value-added consumer markets. Headquartered in New York City, the company is privately held and reported revenues of $479 million in the twelve months ended December 31, 2009. JOSEPH CHARLES LOOMIS: US Trustee Fails to Name Creditors Panel --------------------------------------------------------------- The U.S. Trustee for Region XIV told the U.S. Bankruptcy Court for the District of Arizona that a committee of unsecured creditors in the Joseph Charles Loomis bankruptcy case has not been appointed. The trustee said that an insufficient number of persons holding unsecured claims against the Debtor have expressed interest in serving on a committee. Chandler, Arizona-based Joseph Charles Loomis filed for Chapter 11 bankruptcy protection on January 26, 2010 (Bankr. D. Ariz. Case No. 10-01885). Gerald K. Smith, Esq., at Gerald K. Smith and John C. Smith Law OFC, assists the Debtor in its restructuring effort. The Debtor disclosed $10,283,589 in total assets and $5,349,932 in total debts in its schedules of assets and debts filed with the Court. KIDDIE KANDIDS: CPI Corp. Offers $2.6 Million for Assets -------------------------------------------------------- St. Louis Today reports that CPI Corp. made a $2.6 million offer for Kiddie Kandids at an auction. CPI said it plans to resume operations in the Babies 'R' Us stores and some mall locations. Kiddie Kandids specializes in infant, baby, toddler, children, and family photography. KLCG PROPERTY: KeyLime Water Park Goes to Dougherty in Debt Swap ---------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that KLCG Property LLC and Gurnee Property LLC received approval from the Bankruptcy Court to sell the KeyLime Cove indoor water park in Gurnee, Illinois, to secured lender Dougherty Funding LLC. Dougherty will acquire the facility for $65 million by exchanging some of the pre-bankruptcy secured debt and the $2.8 million loan to finance the Chapter 11 case. Dougherty is owed $89.5 million on a construction loan. The Debtors were accepting competing bids for the property. No competing bids, however, were received by the deadline. About KLCG Property Headquartered in Gurnee, Illinois, KLCG Property, LLC, was organized in Delaware on October 13, 2005, for the purpose of constructing, owning, and operating the KeyLime Cove indoor water park in Gurnee, Illinois, a 414-room destination resort hotel, indoor water park and conference center. The 30-acre water park is adjacent to Six Flags Great America Theme Park. The water park opened in 2008 at a cost of $136 million. KLCG Property filed for Chapter 11 bankruptcy protection on December 16, 2009 (Bankr. D. Del. Case No. 09-14418). The Company's affiliate, Gurnee Property, LLC, also filed for Chapter 11 bankruptcy protection. Donald J. Bowman, Jr., Esq., and Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor assist the Debtors in their restructuring efforts. KLCG Property listed $50,000,001 to $100,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. LAS VEGAS MONORAIL: Ambac Split Leaves Bond Default Probability --------------------------------------------------------------- Christine Richard and Darrell Preston at Bloomberg News report that holders of bonds sold by the Las Vegas Monorail Co. likely won't get their next payment due July 1 because the insurer, Ambac Financial Group Inc., won't cover them. According to the report, the monorail seeks to reorganize under Chapter 11 bankruptcy and has minimal funds to cover its next scheduled debt disbursement of $9.6 million in July, Wells Fargo, the trustee for the bonds, said in a March 26 announcement. While Ambac guarantees payments of $1.2 billion for the monorail, its obligation has been transferred by Wisconsin insurance regulators to a segregated account that temporarily can't honor claims. Wisconsin Insurance Commissioner Sean Dilweg announced on March 26 that his office was taking over Ambac Assurance Corp. liabilities that included policies backing $35 billion in securities, many involving risky mortgages. Mr. Dilweg's office ordered the handover as part of rehabilitation proceedings with respect to the Segregated Account to permit the OCI to facilitate an orderly run- off or settlement of the liabilities allocated to the Segregated Account pursuant to the provisions of the Wisconsin Insurers Rehabilitation and Liquidation Act. The rehabilitation court has issued an injunction effective until further court order enjoining certain actions by Segregated Account policyholders and other counterparties, including the assertion of damages or acceleration of losses based on early termination and the loss of control rights in insured transactions. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial Group, Inc. common stock is listed on the New York Stock Exchange (ticker symbol ABK). Ambac's principal operating subsidiary is Ambac Assurance Corporation, a guarantor of public finance and structured finance obligations. Ambac Assurance has earned a Caa2 rating from Moody's Investors Service, Inc., with a developing outlook and a CC rating from Standard & Poor's Ratings Services with a developing outlook. Moody's Investors Service at the end of July 2009 downgraded to Caa2 from Ba3 the insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited. The rating action was prompted by Ambac's announced large loss reserve increase and credit impairment charge estimated for the second quarter of 2009. Dow Jones notes Ambac once boasted top triple-A credit ratings. In November 2009, Ambac warned it could have problems paying off debt that comes due in 2011. According to Dow Jones, Ambac Financial said it was considering strategies that include a prepackaged bankruptcy-court filing. Before the financial crisis, Ambac was the second-biggest bond insurer behind MBIA Inc. Las Vegas Monorail Las Vegas, Nevada-based Las Vegas Monorail Company, organized by the State of Nevada in 2000 as a nonprofit corporation, owns and manages the Las Vegas Monorail. The Monorail is a seven-stop, elevated train system that travels along a 3.9-mile route near the Las Vegas Strip. LVMC has contracted with Bombardier Transit Corporation to operate the Monorail. Though it benefits from its tax-exempt status due to being a nonprofit entity, LVMC claims to be the first privately-owned public transportation system in the nation to be funded solely by fares and advertising. LVMC says it receives no governmental financial support or subsidies. The Company filed for Chapter 11 bankruptcy protection on January 13, 2010 (Bankr. D. Nev. Case No. 10-10464). Gerald M. Gordon, Esq., at Gordon Silver, assists the Company in its restructuring effort. Alvarez & Marsal North America, LLC, is the Debtor's financial advisor. Stradling Yocca Carlson & Rauth is the Debtor's special bond counsel. Jones Vargas is the Debtor's special corporate counsel. The Company listed $10,000,001 to $50,000,000 in assets and $500,000,001 to $1,000,000,000 in liabilities. LAURUS MASTER FUND: Holds 9.99% of Biovest Int'l Shares ------------------------------------------------------- Russell Smith, the Joint Official Liquidator for the account of Laurus Master Fund, Ltd., disclosed that as of December 31, 2009, the fund may be deemed to beneficially own 10,826,822 shares or roughly 9.99% of the Common Stock of Biovest International, Inc. The shares are also deemed held by PSource Structured Debt Limited, Laurus Capital Management, LLC, Valens U.S. SPV I, LLC, Valens Offshore SPV I, Ltd., Valens Capital Management, LLC, Chris Johnson, Russell Smith, Eugene Grin and David Grin. Chris Johnson, Russell Smith, Eugene Grin and David Grin are affiliated with Johnson Smith Associates Ltd. in Grand Cayman, Cayman Islands. Based in Tampa, Florida, Biovest International Inc. (Other OTC: BVTI) -- http://www.biovest.com/-- is a pioneer in the development of advanced individualized immunotherapies for life- threatening cancers of the blood system. Biovest is a majority- owned subsidiary of Accentia Biopharmaceuticals Inc., with its remaining shares publicly traded. Biovest filed for chapter 11 bankruptcy protection on November 10, 2008 (Bankr. M.D. Fla. Case No. 08-17796). LENNY DYKSTRA: Chapter 7 Trustee Disputes Bid to Close Case ----------------------------------------------------------- Patrick Fitzgerald at Dow Jones' Daily Bankruptcy Review reports that Arturo M. Cisneros, the trustee overseeing Lenny Dykstra's Chapter 7 bankruptcy case, said the ex-ballplayer has been "far from cooperative" and repeatedly interfered with his efforts to sell off assets for the benefit of creditors. Dow Jones notes Mr. Dykstra is seeking dismissal of his bankruptcy case and removal of Mr. Cisneros, so he can regain control of his assets and pay back his creditors in full. According to the report, Mr. Cisneros pointed out that Mr. Dykstra has been "far from a fiduciary" with respect to the best interests of his creditors. The report relates Mr. Cisneros pointed out that: -- Mr. Dykstra's California mansion was in poor condition when the trustee visited the property after being appointed to the case; -- proceeds from pre-bankruptcy memorabilia sales haven't been accounted for; -- Mr. Dykstra blew off multiple meetings with creditors, and twice filed lawsuits -- including a $100 million "predatory lending" suit against J.P. Morgan Chase & Co. -- while the trustee was negotiating settlements on behalf of the estate. A hearing on Mr. Dykstra's bid to regain control of his finances is scheduled for April 6. About Lenny Dykstra Lenny Dykstra is a former Major League Baseball all-star player. He was center fielder for the New York Mets and Philadelphia Phillies. He filed for Chapter 11 bankruptcy protection July 7, 2009 (Bankr. C.D. Calif. Case No. 09-18409). M Jonathan Hayes, Esq., at the Law Office of M Jonathan Hayes, in Northridge, California, assisted the Debtor in his restructuring effort. The Debtor listed up to $50,000 in assets and $10,000,001 to $50,000,000 in debts. A Chapter 11 trustee was appointed in September 2009, and the case was converted to a liquidation in Chapter 7 on November 20, 2009. The trustee -- Arturo M. Cisneros -- was investigating the disposition of personal property both before and after the Chapter 11 filing. MAX & ERMA'S: Selling Restaurant Items and Equipment ---------------------------------------------------- Max & Erma is holding an auction to sell restaurant assets including the colorful lamps, barstools and benches, booths and even bar and kitchen equipment, according to 10tv.com. Max & Erma's owns a chain of 106 restaurants around Pittsburgh. The restaurants are mainly in Pennsylvania, Ohio, and Michigan, with a few in Chicago, Washington, Atlanta, and Kentucky. About 79 are company-owned and operated, while 27 belong to franchisees. Max & Erma's is owned by G&R Acquisitions, North Side. The chain started operating in 1972, taking the Max & Erma's name from two owners of a bar. In October 2009, Max & Erma's filed for Chapter 11 petition in U.S. Bankruptcy Court in Pittsburgh, listing $1 million to $10 million in assets against $1 million to $10 million in debts owed to 200 to 999 creditors. Robert Lampl, Max & Erma's lawyer, said that the Company filed for bankruptcy mainly to fend off its main bank creditor, National City Bank, whom the Company owes about $16 million. National City had taken legal steps to put Max & Erma's in receivership. MERIDIAN RESOURCE: Settles Consolidated Leider Action ----------------------------------------------------- The Meridian Resource Corporation, Alta Mesa Holdings LP, and Alta Mesa Acquisition Sub LLC agreed in principle to settle the now- consolidated Leider, derivatively on behalf of The Meridian Resource Corporation v. Ching, et al., in the 190th Judicial District Court of Harris County, Texas. The settlement is conditioned on, among other things, approval of the Merger by Meridian's shareholders. Under the terms of the proposed settlement, all claims relating to the Merger Agreement and the Merger will be dismissed on behalf of Meridian's stockholders. As part of the settlement, the defendants have agreed not to oppose plaintiff's counsel's request to the court to be paid up to $164,000 for their fees and expenses and up to $1,000 as an incentive award for plaintiff Leider. Any payment of fees, expenses, and incentives is subject to final approval of the settlement and such fees, expenses, and incentives by the court. The proposed settlement will not affect the amount of merger consideration to be paid to Meridian's shareholders in the Merger or change any other terms of the Merger or Merger Agreement. About Meridian Resource Based in Houston, Texas, The Meridian Resource Corporation (NYSE:TMR) -- http://www.tmrc.com/-- is an independent oil and natural gas company engaged in the exploration, exploitation, acquisition and development of oil and natural gas in Louisiana, Texas, and the Gulf of Mexico. Meridian has access to an extensive inventory of seismic data and, among independent producers, is a leader in using 3-D seismic and other technologies to analyze prospects, define risk, target and complete high- potential wells for exploration and development. Meridian has a field office in Weeks Island, Louisiana. At September 30, 2009, the Company had $190,339,000 in total assets, including $18,090,000 in total current assets, against $120,634,000 in total current liabilities and $17,736,000 in asset retirement obligations. The Company noted that its default under the debt agreements, which has been mitigated in the short term by certain forbearance agreements, negatively impacts future cash flow and the Company's access to credit or other forms of capital. There is substantial doubt as to the Company's ability to continue as a going concern for a period longer than the next 12 months, the Company said. It added that it might have to seek protection under federal bankruptcy laws if it is unable to comply with the forbearance agreements or if those agreements expire. M & Z: Gets Court's Nod to Hire Marshack Hays as Bankr. Counsel --------------------------------------------------------------- M & Z Valley Associates, LLC, sought and obtained permission from the Hon. Theodore C. Albert of the U.S. Bankruptcy Court for the Central District of California to employ Marshack Hays LLP as general counsel. Marshack Hays will, among other things: a. represent the Debtor in any proceedings or hearings in the Court and any proceedings in any other court where the Debtor's rights under the Bankruptcy Code may be litigated or affected; b. conduct examinations of witnesses, claimants, or adverse parties and prepare and assist the Debtor in the preparation of, reports, accounts, and pleadings related to the Debtor's case; c. file any motions, applications or other pleadings appropriate to effectuate the reorganization of the Debtor; and d. review claims filed in the Debtor's case, and, if appropriate, prepare and file objections to disputed claims. Marshack Hays will be paid based on the hourly rates of its personnel: Partners $390-$490 Associates $250-$350 Paralegals $110-$190 Richard A. Marshack, a principal at Marshack Hays, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Capistrano Beach, California-based M & Z Valley Associates, LLC, filed for Chapter 11 bankruptcy protection on January 28, 2010 (Bankr. C.D. Calif. Case No. 10-11079). The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. METRO-GOLDWYN-MAYER: Creditor Says Bankruptcy Likely ---------------------------------------------------- Highland Capital Management and other Metro-Goldwyn-Mayer creditors say they aren't inclined to give the financially strapped studio more time to restructure and that it will likely head into bankruptcy, the New York Post reported, citing Patrick Daugherty, a partner at Highland Capital. Mr. Daugherty, a member of the creditors group engaged in the talks with MGM, told The Post that he was disinclined to give the studio until mid-May to put together an out-of-court restructuring, saying that nothing he's heard thus far from MGM management sounds convincing. "I am willing to give our view, hear theirs and work to an outcome that makes sense," Mr. Daugherty said. But "my expectation tells me bankruptcy is more likely than not." According to The Post, Mr. Daugherty said that MGM CEO Stephen Cooper's plea last week for time to come up with a restructuring plan left him unmoved, and that at this point Cooper hasn't sold him on the idea that more time would help the studio put together a reorganization plan outside of bankruptcy court. As widely reported, creditors have been disappointed with the bids that came in for MGM. Bloomberg, citing an unidentified person, relates that Time Warner Inc. offered $1.5 billion. Billionaire Len Blavatnik's Access Industries proposed to reduce MGM's debt and provide cash for film production. Lions Gate Entertainment Corp. said it dropped out of the bidding this week. Liberty Media Corp. and Elliott Management Corp. are also out of the bidding. MGM put itself up for sale last year after failing to make payments on $3.7 billion in debt. The Wall Street Journal reported early this month that MGM is readying a backup plan should bids for its assets come in too low. Sources told the Journal, MGM creditors are increasingly willing to assume control over the studio. The sources said that under that scenario, MGM would likely pursue a "standalone" plan in which lenders would convert their debt to equity. MGM has hired investment bank Moelis & Company and the law firm Skadden, Arps, Slate, Meagher & Flom. In August, it hired the restructuring expert Stephen F. Cooper to help lead the company. MGM is facing a March 31 deadline for its bank debt and an April 8 deadline for a $250 million credit facility. About Metro-Goldwyn-Mayer Metro-Goldwyn-Mayer, Inc., is an independent, privately held motion picture, television, home video, and theatrical production and Distribution Company. The Company owns the world's largest library of modern films, comprising approximately 4,000 titles, and over 10,400 episodes of television programming. An investor consortium, comprised of Providence Equity Partners, TPG Capital, Sony Corporation of America, Comcast Corporation, DLJ Merchant Banking Partners and Quadrangle Group, owns MGM. MIDWEST GAMING: Moody's Assigns 'B3' Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service assigned a B3 Corporate Family Rating and B3 Probability of Default Rating to Midwest Gaming Borrower, LLC. Moody's also assigned a Ba3 to the company's $120 million first lien credit facilities, and a Caa1 to its $175 million second lien notes. The rating outlook is stable. These represent the first ratings assigned to this issuer and all ratings are subject to a review of final documentation. Proceeds from the proposed debt offerings plus a $150 million cash equity contribution by Midwest's owners and $10 million of vendor equipment financing will be used to build a $445 million casino project in Des Plaines, Illinois. Construction is scheduled to begin in April 2010 with a September 2011 planned opening. The B3 Corporate Family Rating considers the start-up nature of Midwest's casino project, single property concentration risk, and the company's relatively small size based on expected net revenues generated in the first year of operations. Risks also include the significant amount of existing competition in Midwest's primary market area. Positive rating consideration is given to the densely populated nature of Midwest's primary market and the significant cash equity component of the capital structure. Also considered are the transaction's credit enhancements including interest and contingency reserves as well as other structural protections. The stable outlook anticipates that Midwest's primary market area will provide enough customer traffic and demand for the project to cover its operating expenses, maintenance capital expenditure requirements, and debt service obligations. Additionally, the outlook incorporates Moody's expectation that the casino project will open on-time and on-budget. Moody's also anticipates that Midwest will be able to maintain debt/EBITDA at no higher than 5 times. New ratings assigned: -- Corporate Family Rating at B3 -- Probability of Default Rating at B3 -- $10 million 1st lien revolving credit facility expiring 2015 at Ba3 (LGD 2, 18%) -- $110 million 1st lien delay draw term loan due 2015 at Ba3 (LGD 2, 18%) -- $175 million 2nd lien secured notes due 2017 at Caa1 (LGD 5, 74%) Midwest Gaming Borrower, LLC, owns the exclusive right to develop a casino in Des Plaines, Illinois, approximately 16 miles northwest of downtown Chicago. Midwest is a joint-venture that will be owned by High Plaines Gaming, LLC (40%), Clairvest Group, Inc. (40%), and other investors (20%). MOHAWK INDUSTRIES: S&P Affirms 'BB+' Corporate Credit Rating ------------------------------------------------------------ Standard & Poor's Rating Services said that it affirmed its 'BB+' corporate credit rating on Calhoun, Ga.-based Mohawk Industries Inc. At the same time, S&P affirmed the 'BB+' issue-level rating on Mohawk's unsecured debt and revised the recovery rating to '3', indicating the likelihood of meaningful (50%-70%) recovery in the event of a payment default, from '4'. S&P removed all ratings from CreditWatch, where S&P had placed them with negative implications on Sept. 9, 2009, following concerns about the difficult operating environment facing Mohawk and its ability to improve credit measures. The outlook is stable. As of Dec. 31, 2009, the company had about $1.85 billion in reported debt outstanding. "The ratings on Mohawk Industries Inc. reflect the company's satisfactory business risk profile that incorporate its strong competitive position in the carpet and floor coverings market, with support from a portfolio of well-recognized brands covering multiple price points and distribution channels," said Standard & Poor's credit analyst Rick Joy. "The ratings also reflect Mohawk's vertically integrated operations, its comprehensive product portfolio, and diverse customer base." However, Mohawk participates in a mature and cyclical industry. S&P believes the company is vulnerable to reduced discretionary spending in an economic downturn and weak housing market, with more than 75% of its sales from the residential market, as the purchase of carpets and other floor coverings can be deferred. Mohawk is a total floor coverings company, providing one-stop shopping to its customers, and holds the lead position in the U.S. with an estimated 24% share of the overall flooring market. The company has the No. 2 position in its largest business segment, Mohawk (about 54% sales), for carpets and rugs behind market leader Shaw (unrated). Mohawk holds the market lead position in the U.S. in the ceramic tile sector through its Dal-Tile segment (about 24% of sales). Mohawk's Unilin segment (about 22% of sales) provides the company with an important exposure to the growing laminate flooring market, with opportunities for expansion of Mohawk's products into the European market. The stable outlook reflects Mohawk's good liquidity position, strong cash balance, and S&P's expectation for continued strong cash flows and near-term debt reduction. S&P expects the company to improve operating performance and profitability over the near term, and to reduce and sustain adjusted debt leverage close to 3x before the end of 2010. S&P would consider raising the ratings if Mohawk can achieve and sustain improved operating performance and credit measures, including adjusted leverage in the 2x to 2.5x area. S&P believes this could happen if sales increased 10% in 2010 while adjusted EBITDA margins improved by 100 basis points. Alternatively, S&P would consider lowering the ratings if operating performance falls below expectation and adjusted debt to EBITDA materially exceeds 4x. S&P believes this could occur if a 15% sales decline were to occur in 2010 while adjusted EBITDA margins declined by more than 200 basis points. MONROE MOTOR: Files for Chapter 11 Bankruptcy Protection -------------------------------------------------------- According to kplctv.com, Monroe Motor Speedway filed for Chapter 11 protection to avert a lender-requested auction of its assets. BizCapital BIDCO II Inc. of New Orleans had filed a petition in the 4th District Court requesting a writ of seizure and sale by Quachita Parish Sheriff's Office of the assets of Monroe Motor. The Company was to be auctioned off on March 17, 2010. Monroe Moto Speedway owns a race track. MOVIE GALLERY: To Close More Than 200 Video Stores -------------------------------------------------- netDockets relates that Movie Gallery, Inc., last week filed a notice with the Bankruptcy Court identifying more than 80 Hollywood Video stores and more than 125 Movie Gallery stores, which will be closed. Pursuant to an earlier order of the bankruptcy court, Gordon Brothers Retail Partners, LLC will immediately begin going-out-of-business sales at the stores. Movie Gallery previously amended the list of stores where Gordon Brothers would be conducting store closing sales on March 12. According to netDockets, the hardest hit states for Hollywood Video closures include California (22 stores listed) and Texas (11 stores listed). On the Movie Gallery side, the hardest hit states include Alabama (14 stores listed), Georgia (10 stores listed), and Texas (10 stores listed). According to Ben Rogers at The Jamestown Sun, the store closing include a branch at 723 First Avenue Street in Jamestown, North Dakota. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc., is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. MOVIE GALLERY: Accommodation Pact with Hollywood Studios Approved ----------------------------------------------------------------- Movie Gallery Inc. and its units asked the Court for authority to enter into an accommodation agreement with major studios Paramount Home Entertainment, Sony Pictures Home Entertainment, Universal Studios Home entertainment, VPD IV, Inc., and Twentieth Century Fox Home Entertainment. In addition, the Debtors ask the Court's permission to pay certain prepetition obligations owed to the major studios and other studio suppliers known as the "B Studios." The Debtors' movie rental business relies on supply relationships with the Studios, among others, for the delivery of new movie titles. Generally, the Debtors can acquire Movies in one of three ways: (i) the Debtors can acquire Movies for a single up-front lump sum payment -- the "Fixed Buy Transactions"; (ii) the Debtors can acquire Movies for a lower up-front payment coupled with an obligation to return or destroy some percentage of the Movies at the end of a specified term rather than selling or continuing to rent the Movies that are delivered pursuant to these programs -- the "Copy Depth Programs"; (iii) the Debtors can acquire Movies for a significantly lower upfront payment coupled with an agreement by the Debtors to share with the studios an agreed upon percentage of the proceeds of future rentals and sales of previously-viewed videos -- "Revenue Sharing Agreement". According to Kimberly A. Pierro, Esq., at Kutak Rock LLP in Richmond, Virginia, the Debtors prefer acquiring new Movies through Revenue Sharing Agreements as opposed to Fixed Buy Transactions or Copy Depth Programs for several reasons. Because the Debtors' per-copy costs under Revenue Sharing Agreements are much lower than the cost of Fixed Buy Transaction and the amounts the Debtors pay are tied to the revenue generated by the title, the Debtors can typically afford to order significantly more copies of any given Movie under a Revenue Sharing Agreement than they can under a Fixed Buy Transaction. The Debtors also purchase Movies from certain B Studios pursuant to more traditional fixed-cost purchase arrangements, Ms. Pierro relates. These relationships have also traditionally been profitable for the Debtors. The Debtors believe it is important for their reorganization that they be able to continue receiving Movies from all B Suppliers on favorable terms on a going forward basis, she says. The Debtors estimate that the Studios are owed in the aggregate, more than $40 million in Up-Front Charges and similar claims on account of Movies delivered prior to the Petition Date. Because Overage Obligations depend on rental and sale performance over a specified Revenue Sharing Term, the Debtors are not able to estimate effectively the amount of Overage Obligations that may arise with respect to Movies delivered prepetition, Ms. Pierro avers. To obtain commitments from the Major Studios to continue to supply Movies and their agreement to waive certain terms of the Revenue Sharing Agreements, the Debtors executed the Accommodation Agreement. Maintaining the Debtors' relationships with the B Studios is also a crucial part of the Debtors' efforts to reorganize, Ms. Pierro stresses. The Debtors need to pay the prepetition obligations to any B Studio that agrees to continue to supply Movies to the Debtors on the same terms and conditions that existed between them prior to the Commencement Date, she relates. With regard to the Major Studios, the Accommodation Agreement provides, among other things, that in return for the Major Studios' commitments to continue to deliver new Movies to the Debtors and to honor existing Revenue Share Agreements with the Debtors, the Major Studios will receive an aggregate of $7,854,178 in payments from the Debtors. The total payments to the Major Studios would be paid out in five equal weekly installments, with the first payment due on the later of (i) the date of the order approving the Accommodation Agreement and (ii) March 12, 2010. The amounts allocated to each Major Studio are: Major Studio Amount ------------ ------ Paramount Home Entertainment $1,544,785 Sony Pictures Home Entertainment $2,101,104 Universal Studios Home Entertainment $1,725,203 VPD, Inc. $643,612 Twentieth Century Fox Home Entertainment $1,839,472 Under the Accommodation Agreement, each of the Major Studios has also agreed to defer its rights to pursue audits of their existing revenue share deals with the Debtors. Revenue share audits are complex and require significant attention and time by the Debtors' personnel, Ms. Pierro points out. Thus, the Major Studios' agreement to defer any audits as part of the Accommodation Agreement will free up the Debtors' personnel to focus on matters more central to the Debtors' restructuring efforts, she explains. The Accommodation Agreement further provides that, in the event a Major Studio refuses to honor its commitments under the Agreement, any amounts paid by the Debtors on account of a prepetition claim will be returned to the Debtors. With regard to the B Studios, the Debtors have not entered into any agreements similar to the Accommodation Agreement. The Debtors expect that many of the B Studios will continue to supply Movies to the Debtors under the same terms and conditions that existed prior to the Commencement Date, but only if the Debtors pay Overage Obligations when due. The Official Committee of Unsecured Creditors supports the Debtors' entry into the Accommodation Agreement and asks the Court to approve the Debtors' request. Counsel for the Committee, Tara L. Elgie, Esq., at Hunton & Williams LLP, in Richmond, Virginia -- telgie@hunton.com -- said ensuring uninterrupted dealings with the Studios under the Revenue Sharing Agreements and the attendant cash flow from highly anticipated titles expected in the near term will facilitate the Debtors' reorganization effort and preserve the value of the First Lien Term Lenders' collateral. * * * Judge Tice granted the motion on March 23, 2010, and approved the Debtors' entry into the Accommodation Agreement with Major Studios, including the authority to enter into other agreements that may be contemplated by the Accommodation Agreement, provided that: (a) No subsequent agreement will provide for postpetition payment of any unpaid prepetition up-front charges except as expressly set forth in the Accommodation Agreement; and (b) When entering into subsequent agreements after March 23 that are on terms less favorable to the Debtors than any current corresponding agreement, the Debtors will be required to provide the Committee with reasonable prior notice. Failure of the Debtors to consult with the Official Committee of Unsecured Creditors will not affect the enforceability of subsequent agreements. Judge Tice further ruled that the acceptance by a B Studio of a payment authorized by the Order will be deemed to be consent by the B Studio to the terms of the Order. In the event that a B Studio accepts a payment and then subsequently refuses to honor its commitments to continue as it did prior to the Petition Date, then that B Studio will immediately repay to the Debtors any amounts it received on account of a prepetition claim pursuant to the Order. Prior to Court approval, Wilmington Trust Company, the Administrative Agent for the First Lien term Lenders under the Amended and Restated First Lien Credit and Guaranty Agreement dated as of May 20, 2008, asked the Court to continue the hearing on the motion which was then set for March 16, 2010, for one week. WTC asked for the continuance to give the First Lien Term Lenders the review time they are entitled to, arguing that the Studio Payments are coming directly out of the First Lien Term Lenders' recovery. If the Court does not grant its request for continuance, WTC asked the Court to deny the motion on grounds that the Studio Payments are not necessary or fair or equitable with regard to the First Lien Term Lenders' interests, and the Debtors have failed to submit any evidence to support the Studio Payments. Judge Tice overruled the objection and denied the request for continuance. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc., is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. MOVIE GALLERY: Proposes Protocol for Misc. Assets Sale ------------------------------------------------------ Movie Gallery, Inc. and its debtor-affiliates sought and obtained the approval of Judge Douglas O. Tice Jr. of the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, of proposed procedures for the sale of miscellaneous assets. Kimberly A. Pierro, Esq., at Kutak Rock LLP in Richmond, Virginia -- Kimberly.Pierro@KutakRock.com -- told the Court that it would be an unreasonable use of resources and an inefficient use of time if the Debtors obtain the Court's approval by motion each and every time they seek to sell Miscellaneous Assets. The Debtors sought permission to sell or otherwise transfer the Miscellaneous Assets, without further hearing or order of the Court, subject to the requirements provided by the Miscellaneous Sale Procedures: A. With regard to a sale or transfer of Miscellaneous Assets through any individual transaction or series of related transactions to a single buyer or group of related buyers that would generate net proceeds less than or equal to $50,000, the Debtors are authorized to consummate the sales or transfers if the Debtors determine that the sales or transfers are in the best interest of their estates, without further Court order or notice to any party. B. With regard to a sale or transfer of Miscellaneous Assets through any individual transaction or series of related transactions to a single buyer or group of related buyers that would generate net proceeds greater than $50,000 but less than or equal to $250,000: (i) the Debtors are authorized to consummate the sales or transfers if the Debtors determine that the sales or transfers are in the best interest of their estates; (ii) the Debtors will serve written notice of the sales or transfers to (i) the Core Group, and (ii) Affected Entities, if any, by overnight mail, first-class mail or e-mail; (iii) if no written objections are filed by the Notice parties and actually received by Debtors' counsel within 10 days of the date of the notice, the Debtors are authorized to immediately consummate the transaction provided that the Notice Parties will have an additional three business days to object if the Notice of Miscellaneous Asset Sale is served by first-class mail; and (iv) if a written objection from a Notice Party is filed and actually received by Debtors' counsel within the 10- or 13-day period, as appropriate, that cannot be resolved, the relevant Miscellaneous Asset(s) will only be sold upon further Court order. Judge Tice authorized the Debtors to sell miscellaneous assets outside the ordinary course of business. Moreover, Judge Tice determined that the Debtors will be deemed to be in compliance with Section 363(f) of the Bankruptcy Code unless a party timely objects to their Notice of Miscellaneous Asset Sale. Sales and transfers of Miscellaneous Assets are free and clear of all liens and encumbrances with Liens attaching to the net proceeds of the sale or transfer with the same validity, extent and priority as had attached to the Miscellaneous Assets immediately prior to its sale or transfer, Judge Tice ruled. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc., is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. MOVIE GALLERY: Parties Object to Cash Collateral Use ---------------------------------------------------- More parties join in the objection of Developers Diversified Realty Corporation and the other landlords opposed to the Debtors' request to use prepetition cash collateral. The parties ask the Court to compel the Debtors to immediately pay postpetition rent on their leased properties. The parties are: Four Bears Holdings Limited Partnership, GAM Ventures One, Lakerose Properties, Ltd., Sunrise Plaza Associates, L.P., Schooler Properties of Thornbourg, LLC, Schooler Properties of Salem Fields, LLC, Schooler Properties of King George, Schooler Properties of Ladysmith, Beachgate Shopping Center, LC, Site, Woodstock, LLC.; JHN Investment Properties, LLC, Realty Income Corporation, Realty Income Texas Properties I, LLC, Eastland Shopping Center, LLC, Aero Drive, LLC, Oliveyard, LLC, Rosita Young; Kimco Realty Corporation and its affiliates, Southern Development of Mississippi, Inc. and SHAG of Mississippi, Inc., Glimcher Properties Limited Partnership, D.D. Dunlop Companies, Inc., and First Interstate Mentor Commons, Ltd. In a memorandum supporting their objection, Developers Diversified Realty Corporation and its affiliated entities pointed out that the Debtor must pay a reasonable amount of rental for the use and occupancy of leased premises prior to the assumption and rejection of unexpired leases. Debtors Respond The Debtors, reacting to the objections of the entities demanding immediate payment of Stub Rent, filed their reply, arguing that the Bankruptcy Code does not entitle a landlord to a higher priority claim when the debtor does not pay its rent. Furthermore, this early juncture in these cases would not be an appropriate time in any event to compel the payment of Stub Rent, the Debtors said. Jeremy S. Williams, Esq., at Kutak Rock LLP, in Richmond, Virginia -- Jeremy.Williams@KutakRock.com -- said A decision requiring the immediate payment of Stub Rent would have an extremely adverse and equally immediate negative impact on the prospect for the Debtors' successful reorganization. On the other hand, Wilmington Trust Company expressed its support to the Final Cash Collateral Order. WTC stated that the terms of the consensual Cash Collateral Order incorporating a budget which does not provide for the payment of Stub Rent during the Chapter 11 operating period and containing a Section 506(c) waiver are appropriate and well supported by accepted legal precedent. Thus, there is no need for the Court to consider disturbing the heavily negotiated, consensual arrangement entered into by the Debtors and their primary Secured Lenders to permit cash collateral use, WTC contends. WTC is the Administrative Agent pursuant to the agreement reached between the Debtors, certain landlords and the Creditors' Committee as memorialized in the Final Cash Collateral Order. Creditors' Committee Talks Back In a memorandum, the Creditors' Committee strongly objected to the Debtors' position that they do not need to pay Stub Rent even though the landlords' property is being used for the Debtors' liquidation sales. The Creditors' Committee said it is more concerned with the going-out-of-business stores, since the store leases are being used for the benefit of the secured creditors and there is no chance that these leases will be assumed and thereby cured. Under the Bankruptcy Code, landlords cannot be forced to wait indefinitely for the payment of Stub Rent, the Creditors' Committee argues. Section 365(d)(3), according to Tara L. Elgie, Esq., at Hunton Williams LLP in Richmond, Virginia, provides that the landlords must timely pay all postpetition rent on unexpired leases of nonresidential real property. Lenado's Statement on Stub Rent Payment Lenado Capital Advisors, LLC, Aspen Advisors, LLC, and Owl Creek Capital Management LLC, file their statement regarding the waiver of certain landlords and Official Committee of Unsecured Creditors to Section 506(c) of the Bankruptcy code in the Final Cash Collateral Order and demand for pre-payment of Stub Rent. The Lenado entities are investment managers and attorneys in fact for certain funds and accounts. Lynn L. Tavenner, Esq., at Tavenner & Beran, PLC in Richmond, Virginia, represents the Lenado entities regarding the matters raised by the Landlords and the Creditors' Committee with respect to the payment of rent attributable for the period from the Petition Date through February 28, 2010. In addition, Lenado raised the provision in the Final Cash Collateral Order waiving the application of Section 506(c) to Stub Rent in connection with the use of Cash Collateral. Ms. Tavenner said that there is no obligation for the Debtors' estates to pre-pay Stub Rent to any landlords prior to confirmation of a plan of reorganization and payment of other similarly situated claims. As a result, the demand by the Landlords for prepayment of Stub Rent should be overruled. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc., is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. MOVIE GALLERY: Site Woodstock, et al., Want Lease Payments ---------------------------------------------------------- In separate motions, Site Woodstock, LLC, Fred Meyer Stores, and Smith's Food and Drug ask the Court to enforce on the Debtors' their obligation to pay all postpetition rent on their leased premises where the Debtors are presently conducting store closing sales. Site asks the Court to direct the Debtors to pay postpetition rent on its premises beginning March 1, 2010, until the effective date of the rejection of their Leases. FMS and SFC ask the Court to compel the debtors to pay the March rent for their premises not later than March 15, otherwise, direct that the Debtors cease conducting store closing sales at those locations and rule that the leases are deemed rejected under Section 365 of the Bankruptcy Code. Developers Diversified Realty Corporation and eight other Landlords join in Site's motion and specifically ask the Court to compel the Debtors to pay immediately in full the March rent for their premises that the Debtors intend to reject in March. Debtors Address Objections In order to address the Landlords' objections to the Store Closing Procedures that do not involve objections related to the immediate payment of Stub Rent, the Debtors present their omnibus reply to specifically deal with the major issues raised by the objecting Landlords. Kimberly A. Pierro. Esq., at Kutak Rock LLP, in Richmond, Virginia, centered the Debtors' omnibus reply on these issues: 1. Duration of Sale. The duration of the Store Closing Sales is specifically limited to eight weeks from commencement. Any extension of the duration of the sales would require the Debtors to return to the Court for approval of an extension and provide notice and opportunity to other parties to object. 2. Augmentation of Inventory. Contrary to the some objecting Landlords' apprehensions, the Debtors do not intend to augment their inventory with that of third parties when conducting the Store Closing Sales. To the extent that the Landlords object to the free movement of the Debtors' own inventory between stores during the short duration of these sales, that restriction is impermissible and unjustified limitation on the Debtors' rights that existed prepetition. The Landlords making this objection have provided no basis or need for that limitation. 3. Removal of Trade Fixtures. With respect to concerns of some Landlords that property not belonging to the Debtors would be included in the Store Closing Sales, the Debtors specifically state that they have no intention to sell anything that is not their property. The Debtors have asked the Landlords to specify which property give rise to their concerns. 4. Abandonment of Property and Indemnity for Physical Damage. The Landlords have not stated any basis to bar abandonment of property burdensome to the estate, and their concerns are best handled by the claims resolution process. All parties reserve their rights under the Store Closing Procedures, thus, the procedures should not be modified to include preemptive and presumptive claim allowance. More Parties Object Developers Diversified Realty Corporation and five other Landlords objected to the Debtors' proposed Final Order authorizing the Debtors to conduct store closing sales. The Debtors must pay postpetition rent when due pursuant to Section 365(d)(3) of the Bankruptcy Code, DDRC contends. In this regard, DDRC asks the Court to modify the Proposed Store Closing Sales Order and require the Debtors to remain current on all Lease obligations by adding this language: "Except as previously Ordered by the Court with respect to rent for February 2010, the Debtors shall timely perform all obligations arising under the leases at the closing stores arising from and after the Petition Date until the leases are assumed or rejected as required by section 365(d)(3) of the Bankruptcy Code." Fred Meyer Stores, Inc., and three other landlords join in DDRC's objections. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc., is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. NEIMAN MARCUS: S&P Changes Outlook to Stable; Affirms 'B' Rating ---------------------------------------------------------------- Standard & Poor's Rating Services said it revised the outlook on Dallas-based luxury department store operator Neiman Marcus Group Inc. to stable from negative. At the same time, S&P affirmed all other ratings on the company, including its 'B' corporate credit rating. "The outlook revision to stable reflects S&P's belief that operations are likely to improve moderately as luxury consumers increase their spending in the near term," said Standard & Poor's credit analyst David Kuntz. Commensurate with anticipated performance gains, credit protection metrics should demonstrate improvement as well. NEW COMMUNICATIONS: S&P Assigns 'BB' Rating on $500 Mil. Notes -------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'BB' issue-level rating and '3' recovery rating to New Communications Holdings Inc.'s proposed $500 million senior unsecured notes due 2015 and $500 million senior unsecured notes due 2022. The '3' recovery rating on the notes indicates expectations for meaningful (50%-70%) recovery in the event of payment default. New Communications is a subsidiary of Verizon Communications Inc. (A/Negative/A-1), but will ultimately be merged into Stamford, Conn.-based Frontier Communications Corp. (BB/Stable/--). The ratings on Frontier, including the 'BB' corporate credit rating, remain unchanged. The new unsecured notes will be an addition to the proposed $1.1 billion senior unsecured notes due 2017 and $1.1 billion due 2020. Total proceeds of $3.2 billion will fund a special cash distribution to Verizon and pay related fees and expenses prior to the spin-off of New Communications Holdings and its merger with Frontier as part of the acquisition of about 4.2 million access lines. The notes will be issued under rule 144A with registration rights. If the merger agreement is terminated, the notes will be redeemed by Frontier at the issue price plus accrued interest. Noteholders will not have any recourse to Verizon Communications or any of its subsidiaries. S&P expects Frontier's total funded debt to be about $8 billion. Ratings List Frontier Communications Corp. Corporate Credit Rating BB/Stable/-- New Rating New Communications Holdings Inc. Proposed $500 million senior unsecured notes due 2015 BB Recovery Rating 3 Proposed $500 million senior unsecured notes due 2022 BB Recovery Rating 3 NORTEL NETWORKS: Ontario Court Rejects Deal with Ex-Employees ------------------------------------------------------------- Justice Morawetz of the Ontario Superior Court of Justice has rejected a proposed settlement in the Nortel insolvency proceedings involving the claims of Nortel's terminated employees, pensioners and employees on long term disability. The settlement set aside C$57 million to pay benefits to the company's former and disabled employees until year-end. Nortel's funding of such benefits is set to expire on March 31. In exchange, the agreement provided that the former and disabled employees would not sue parties involved in the management and funding of Nortel's pension and health and welfare funds. The agreement also provided that any such claims of the former and disabled employees would rank as being equal to the claims of ordinary unsecured creditors. Rochon Genova LLP, a leading class action firm dedicated to providing access to justice for Canadians, appeared at the settlement approval hearing on behalf of some 36 dissenting Nortel employees with long term disabilities. The group was opposed to certain terms of the settlement agreement, including a requirement that disabled employees give up their rights to sue the trustees and Nortel's directors and officers governing the Health and Welfare Trust in relation to a funding shortfall of in excess of $100 million. Mr. Rochon, the group's lawyer, stated: "From our perspective, we are pleased that the deal did not get approved because of the extreme prejudice that would have resulted to our clients. Any deal struck must respect the dignity of the LTD employees -- none of the stakeholders wants to see this vulnerable group reduced to poverty through the CCAA process -- I remain optimistic that all stakeholders can come together to negotiate an agreement that adequately protects the legitimate interests of the disabled employees without disrupting the bankruptcy process and materially affecting the other creditor groups." Jennifer Holley, one of the objecting employees on LTD, stated: "While I am disappointed with the uncertainty as to what will happen to my benefits, more worrisome is the fact that my family would be condemned to poverty for the rest of our lives if the proposed agreement was approved without further consideration of our interests. I am also deeply concerned that a judge could approve tens of millions of dollars in executive bonuses one week, yet be prepared to dismiss the rights of disabled employees to recover the millions of dollars taken from us the next. I pray that Canada will do something to keep disabled employees from becoming victims of our outdated bankruptcy laws." 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 the Company's customers. The Company's next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate the 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 was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (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 the Chapter 15 petitioner's counsel. 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. Certain of Nortel's European subsidiaries 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 US$11.6 billion and consolidated liabilities of US$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 US$9 billion and liabilities of US$3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about US$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) N.Y.C. OFF-TRACK: Seeks to Defer Payments to Racetracks ------------------------------------------------------- BloodHorse.com reports that New York City Off-Track Betting Corp. officials, rebuffed by the state legislature for a temporary plan to keep the entity solvent, are preparing to seek a bankruptcy judge's help in deferring statutory payments to racetracks and others to delay a planned April 11 shutdown of its operations. According to the report, sources close to the matter said NYCOTB is planning to ask the federal judge overseeing its case to do what state officials would not do -- delay certain revenue-sharing payments during April and possibly May to be able to keep enough cash to meet the payroll for its more than 1,300 employees. NYCOTB chairman Meyer "Sandy" Frucher said NYCOTB is not bluffing in its April 11 closing unless it gets a way to raise or keep additional cash. "It's a ticking time bomb. Our drop-dead date is April 11," Mr. Frucher said in a March 29 interview with BloodHorse. The legislature has left town until April 7 following a breakdown in state budget talks among the Assembly, Senate, and Gov. David Paterson. About NYC OTB New York City Off-Track Betting Corporation is a public benefit corporation, which operates an off-track pari-mutuel betting system on thoroughbred and harness horse races held at all 11 race tracks located in New York State and certain race tracks located outside of the State. Since NYC OTB's inception in 1971, it has made payments of nearly $2 billion to the State horse racing industry, over $1.4 billion to New York City and nearly $600 million to the State. In 2008 alone, NYC OTB made statutory contributions in an aggregate amount of $128.6 million to the State horse racing industry, the State, the City, and other local municipalities. NYC OTB's operations are regulated by the State. NYC OTB filed for bankruptcy under Chapter 9 of the Bankruptcy Code on December 3, 2009 (Bankr. S.D.N.Y. Case No. 09-17121). Richard Levin, Esq., at Cravath, Swaine & Moore LLP, in New York, serves as the Debtor's counsel. At September 30, 2009, NYC OTB had $18,468,147 in total assets against $74,912,742 in total current liabilities, $6,982,887 in long-term liabilities, and $201,020,000 in long-term post employment benefits. Raymond Casey, President and Chief Executive Officer of NYC OTB, said in court papers that over time, higher mandatory distributions required by the State Legislature, combined with increases in the cost of operating in New York City, left NYC OTB with no residual income to turn over to the City. NYC OTB laid off 17% of its management, closed underperforming branches, reduced employees' overtime hours, surrendered a quarter of its headquarters space, reduced supply purchases, decreased security expenses and reduced energy costs -- resulting in nearly $45 million of savings during the five-year period through the end of the 2008 fiscal year. While making the difficult decisions needed to reduce operational costs, NYC OTB also launched a campaign seeking to have the State Legislature rationalize the flawed and burdensome legislative distribution scheme. OCCULOGIX INC: Posts $4.4 Million Net Loss in 2009 -------------------------------------------------- OccuLogix, Inc., filed its annual report on Form 10-K, showing a net loss of $4.4 million on $868,763 of revenue for 2009, compared with a net loss of $9.4 million on $458,202 of revenue for 2008. The Company's balance sheet as of December 31, 2009, showed $9.7 million in assets, $3.0 million of debts, and $6.7 million of stockholders' equity. The Company's working capital deficit at December 31, 2009, is $2,132,036. In the period subsequent to December 31, 2009, the Company raised gross proceeds of $8.0 million in private placement and registered direct financings. "Although current levels of cash flows are negative, management believes the Company's existing cash as well as the proceeds from the funding received subsequent to December 31, 2009, will be sufficient to cover its operating and other cash demands for at least the next 12 months." The independent auditors did not include a "going concern" qualification in its report on the Company's financial statements for the year ended December 31, 2009. For the years ended December 31, 2008, and 2007, the Company's independent auditors, Ernst & Young LLP, expressed substantial doubt about the Company's ability to continue as a going concern, noting that of the Company's recurring operating losses and minimal working capital. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5cb7 San Diego, Calif.-based OccuLogix, Inc. is an in-vitro diagnostic company. The Company is commercializing a proprietary tear testing platform, the TearLab(TM) Osmolarity System that enables eye care practitioners to test for highly sensitive and specific biomarkers using nanoliters of tear film at the point-of-care. * * * This concludes the Troubled Company Reporter's coverage of OccuLogix, Inc. until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. OCCULOGIX INC: Hudson Bay Discloses Equity Stake ------------------------------------------------ Hudson Bay Fund, LP, Hudson Bay Overseas Fund Ltd., Hudson Bay Capital Management, L.P., and Sander Gerber disclosed that as of March 15, 2010, they may be deemed to beneficially own in the aggregate 605,548 shares of Common Stock and Warrants to purchase 8,560 shares of OccuLogix, Inc. Common Stock, which expire on February 6, 2012. About OccuLogix dba TearLab Corporation Headquartered in San Diego, California, OccuLogix, Inc. dba TearLab Corporation -- http://www.tearlab.com-- develops and markets lab-on-a-chip technologies that enable eye care practitioners to improve standard of care by objectively and quantitatively testing for disease markers in tears at the point- of-care. The TearLab Osmolarity Test, for diagnosing Dry Eye Disease, is the first assay developed for the award winning TearLab Osmolarity System. TearLab Corporation's common shares trade on the NASDAQ Capital Market under the symbol 'TEAR' and on the Toronto Stock Exchange under the symbol 'TLB'. TearLab is currently marketed globally in more than 17 countries including the U.S. At September 30, 2009, the Company had $10,674,343 in total assets against total current liabilities of $2,389,625 and contingently redeemable common stock of $250,000. At September 30, 2009, the Company had $370,335,623 in accumulated deficit and stockholders' equity of $8,034,718. The Company noted in its quarterly report on Form 10-Q for the quarter ended September 30, 2009, it has sustained substantial losses of $14,181,433 for the year ended December 31, 2008 and $2,678,252 and $7,097,008 for the nine months ended September 30, 2009 and 2008, respectively. OccuLogix, Inc., said as a result of its history of losses and financial condition, there is substantial doubt about its ability to continue as a going concern. OCCULOGIX INC: Cranshire Capital Holds 6.2% of Common Stock ----------------------------------------------------------- Cranshire Capital, L.P., Downsview Capital, Inc., and Mitchell P. Kopin disclosed that as of March 14, 2010, they may be deemed to beneficially own 776,397 shares of OccuLogix, Inc. Common Stock, representing beneficial ownership of approximately 6.2% of the Common Stock. On March 14, 2010, Cranshire executed a Securities Purchase Agreement with the Company. The shares are based on (1) 11,830,129 shares of Common Stock issued and outstanding on March 15, 2010, plus (2) 776,397 shares of Common Stock to be issued to Cranshire at the closing of a transaction with the Company. The shares excludes (I) 310,559 shares of Common Stock issuable upon exercise of a warrant to be issued to Cranshire at the closing of the transaction because the Warrant is not exercisable until September 19, 2010 -- and the Warrant also contains a blocker provision under which the holder thereof does not have the right to exercise the Warrant to the extent (but only to the extent) that such exercise would result in beneficial ownership by the holder thereof, together with its affiliates and any other persons acting as a group together with the holder or any of the holder's affiliates, of more than 4.9% of the Common Stock -- and (II) 5,360 shares of Common Stock issuable upon exercise of another warrant held by Cranshire because the Other Warrant contains a blocker provision under which the holder does not have the right to exercise the Other Warrant to the extent that such exercise would result in beneficial ownership by the holder thereof, together with its affiliates and any other persons whose beneficial ownership would be aggregated with the holder's, of more than 4.999% of the Common Stock. Without the blocker provisions (and assuming the Warrant is currently exercisable), Cranshire et al. may be deemed to beneficially own 1,092,316 shares of Common Stock. About OccuLogix dba TearLab Corporation Headquartered in San Diego, California, OccuLogix, Inc. dba TearLab Corporation -- http://www.tearlab.com-- develops and markets lab-on-a-chip technologies that enable eye care practitioners to improve standard of care by objectively and quantitatively testing for disease markers in tears at the point- of-care. The TearLab Osmolarity Test, for diagnosing Dry Eye Disease, is the first assay developed for the award winning TearLab Osmolarity System. TearLab Corporation's common shares trade on the NASDAQ Capital Market under the symbol 'TEAR' and on the Toronto Stock Exchange under the symbol 'TLB'. TearLab is currently marketed globally in more than 17 countries including the U.S. At September 30, 2009, the Company had $10,674,343 in total assets against total current liabilities of $2,389,625 and contingently redeemable common stock of $250,000. At September 30, 2009, the Company had $370,335,623 in accumulated deficit and stockholders' equity of $8,034,718. The Company noted in its quarterly report on Form 10-Q for the quarter ended September 30, 2009, it has sustained substantial losses of $14,181,433 for the year ended December 31, 2008 and $2,678,252 and $7,097,008 for the nine months ended September 30, 2009 and 2008, respectively. OccuLogix, Inc., said as a result of its history of losses and financial condition, there is substantial doubt about its ability to continue as a going concern. OLLIE'S NOODLE: Files for Bankruptcy After Labor Suit Loss ---------------------------------------------------------- Adrianne Pasquarelli at Crain's New York Business reports that Ollie's Noodle Shop & Grille filed for Chapter 11 bankruptcy, listing assets of $563,000 and liabilities totaling more than $3.7 million. The filing came after the Company was found in violation of labor laws early 2010. According to the report, the Company was found guilty of violating overtime and minimum wage laws and ordered to pay $2.3 million. The Company allegedly paid employees $1.4 an hour. The minimum wage is 7.25 in New York state. Ollie's Noodle Shop & Grille operates a restaurant in New York. OSAGE EXPLORATION: GPKM LLP Raises Going Concern Doubt ------------------------------------------------------ GPKM LLP of Encino, California, expressed substantial doubt about Osage Exploration and Development Inc.'s ability to continue as a going concern. The firm reported that the Company has suffered recurring losses from operations and has an accumulated deficit as of December 31, 2009. The Company's balance sheet at the end of 2009 revealed $3.1 million in total assets, against $272,881 in total current liabilities and a $55,742 liability for assets retirement obligations, for a $2.7 million stockholders' deficit. The Company reported a $2.3 million net loss on $2.8 million of total operating revenues for 2009 compared with a $3.7 million net loss on $3.1 million of total operating revenues for 2008. The Company's operating plans require additional funds that may take the form of debt or equity financings. There can be no assurance that additional funds will be available. The Company says its ability to continue as a going concern is in substantial doubt and is dependent upon achieving a profitable level of operations and obtaining additional financing. In the event that the Company is unable to continue as a going concern, the Company says it may elect or be required to seek protection from its creditors by filing a voluntary petition in bankruptcy or may be subject to an involuntary petition in bankruptcy. A full-text copy of the Company's Form 10-K is available for free at http://ResearchArchives.com/t/s?5c2b About Osage Exploration and Development Based in San Diego, California with production offices in Oklahoma City, Oklahoma, and executive offices in Bogota, Colombia, Osage Exploration and Development, Inc. (OTC BB: OEDV) -- http://www.osageexploration.com/-- is an independent exploration and production company with interests in oil and gas wells and prospects in the US and Colombia. PACIFIC ETHANOL: Files Plan of Reorganization --------------------------------------------- Pacific Ethanol, Inc., disclosed that on March 26, 2010, its wholly-owned subsidiary, Pacific Ethanol Holding Co. LLC, together with PEH's four wholly-owned ethanol production facilities, filed a Plan of Reorganization and related draft Disclosure Statement with the U.S. Bankruptcy Court in Delaware in cooperation with WestLB AG and other secured lenders. The Company expects PEH and the Plant Subsidiaries to emerge from bankruptcy near the end of the second quarter of this year. The proposed Plan provides for up to $35 million in a new line of credit to support current and future plant operations and restructures the $293.5 million of secured debt of the Plant Subsidiaries to a combination of equity and $115 million of secured and subordinated debt. Under the Plan, the ownership of the Plant Subsidiaries will be transferred to a newly formed holding company owned by the lenders. The Company will continue to staff, manage and operate the plants under the terms of an amended and restated asset management agreement and will continue to market all the ethanol and distillers grains produced by the plants under the terms of the amended and restated agreements with the Company's subsidiaries, Kinergy Marketing and Pacific Ag Products. The Company is currently negotiating with the lenders regarding a potential acquisition of ownership interests in New PEH. If these negotiations result in an agreement, the Plan will be amended. The Company believes that the combination of new and restructured debt under the Plan will provide the needed liquidity to support the resumption of operations at the plants located in Madera and Stockton, California, and sustained production of ethanol at all four plants, as market conditions permit. Neil Koehler, Pacific Ethanol's CEO and President said, "The Plan will significantly improve the balance sheets of the Company and its Plant Subsidiaries by reducing debt and providing new working capital. We believe the combined companies will be well positioned to continue as the leading producer and marketer of low carbon renewable fuels in the Western United States. Working in cooperation with our lenders in filing this Plan, we are excited about the long term, strategic growth opportunities for the Company as the market for our products and services continues to expand." About Pacific Ethanol Pacific Ethanol Holding Co. LLC and four affiliates filed for Chapter 11 on May 17, 2009 (Bankr. D. Del. Case No. 09-11713). Judge Kevin Gross handles the case. Attorneys at Cooley Godward Kronish LLP represent the Debtors as counsel. Attorneys at Potter Anderson & Corroon LLP are co-counsel. Epiq Bankruptcy Solutions LLC is the claims agent. Pacific Ethanol Holding disclosed $50 million to $100 million in assets and $100 million to $500 million in debts in its petition. Pacific Ethanol Inc. and its marketing subsidiaries, Kinergy Marketing LLC, and Pacific Ag. Products, LLC, have not filed for Chapter 11 bankruptcy protection. The Company is expected to continue to manage the Plant Subsidiaries under an Asset Management Agreement and Kinergy and PAP are expected to continue to market and sell the Plant Subsidiaries' ethanol and feed production under existing Marketing Agreements. PACIFIC PANORAMA: U.S. Trustee Fails to Appoint Creditors Panel --------------------------------------------------------------- The U.S. Trustee for Region XVII told the U.S. Bankruptcy Court for the District of Nevada that no committee of unsecured creditors has been appointed. Las Vegas, Nevada-based Pacific Panorama, LLC, filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. D. Nev. Case No. 10-11464). Armand Fried, Esq., who has an office in Las Vegas, Nevada, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. PACIFIC PANORAMA: Taps David A. Riggi as Bankruptcy Counsel ----------------------------------------------------------- Pacific Panorama LLC has asked for permission from the U.S. Bankruptcy Court for the District of Nevada to employ the Law Office of David A. Riggi as bankruptcy counsel. The David A. Raggi will, among other things: a. institute, prosecute, or defend any contested matters arising out of the bankruptcy proceeding in which the Debtor may be a party; b. assist in the recovery and obtain Court approval for recovery and liquidation of estate assets, and assist in protecting and preserving the same where necessary; c. assist in determining the priorities and status of claims and in filing objections thereto where necessary; and d. assist in the preparation of a disclosure statement and Chapter 11 plan. David A. Raggi will be paid based on the hourly rates of its personnel: Partners $300 Associates $195 Paralegals or Law Clerks $135 David A. Riggi, the principal of the Law Office of David A. Riggi, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Las Vegas, Nevada-based Pacific Panorama, LLC, filed for Chapter 11 bankruptcy protection on January 29, 2010 (Bankr. D. Nev. Case No. 10-11464). The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. PACKAGING DYNAMICS: S&P Puts 'B-' Rating on CreditWatch Positive ---------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B-' corporate credit and other ratings on Packaging Dynamics Corp. on CreditWatch with positive implications. "The CreditWatch placement reflects the recent meaningful debt reduction that Packaging Dynamics has made with cash generated from its core operations and funds from alternative-fuel-mixture- credits [AFMC], and its improving operating performance," said Standard & Poor's credit analyst Andy Sookram. Following the significant customer destocking period that occurred in late 2008 and early 2009, which led to lower demand and selling prices, Packaging Dynamics' adjusted EBITDA has improved in the last several quarters. This measurement was $3 million for the March 2009 period, and increased to $10 million, $17 million, and $15 million for the following three sequential quarters. This improvement resulted from lower input costs, benefits from cost savings initiatives, and recovering demand in certain segments, particularly food packaging. Higher earnings, combined with benefits from working capital management and lower capital spending contributed to significantly higher free cash flow (excluding funds from AFMC), which increased to nearly $17 million for the 12-month period ended Dec. 31, 2009, from $1 million for the same period in 2008. Packaging Dynamics used free cash flow and funds from AFMC of about $20 million to reduce debt. As a result, total adjusted debt declined to $296 million at Dec. 31, 2009, from about $340 million a year ago, leverage declined to around 6.6x from nearly 8x over the same timeframe, and interest coverage increased to nearly 2x from 1.5x. In resolving its CreditWatch listing, S&P will assess management's near- and intermediate-term business and financial strategies, including financial policies, and its plans for renewing the asset-based facility (due June 2011) under reasonable terms in the near term. PETER CAPONE: Wants to Hire Michaelson Susi as Bankruptcy Counsel ----------------------------------------------------------------- Peter Capone has sought authorization from the U.S. Bankruptcy Court for the Central District of California to employ Michaelson, Susi & Michaelson, a Professional Corporation, as bankruptcy counsel. MS&M will represent the Debtor in prosecuting or defending these contested matters and adversary proceedings in the Court: a. relief from stay actions; b. plan of reorganization and disclosure statement disputes; and c. matters initiated by the U.S. Trustee. MS&M will be paid based on the hourly rates of its personnel: Peter Susi $475 Franklyn S. Michaelson $475 Marjorie Lakin Erickson $350 Jon Gura $340 Legal Assistants $95 Peter Susi, a member at MS&M, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Santa Ynez, California-based Peter Capone filed for Chapter 11 bankruptcy protection on February 19, 2010 (Bankr. C.D. Calif. Case No. 10-10782). The Debtor estimated his assets and debts at $10,000,001 to $50,000,000. PRA INTERNATIONAL: Moody's Gives Stable Outlook; Keeps 'B3' Rating ------------------------------------------------------------------ Moody's Investors Service changed the rating outlook for PRA International, Inc., to stable from negative. At the same time, Moody's affirmed the ratings, including the Corporate Family Rating of B3 and the Probability of Default Rating of B2. The stable outlook reflects the significant improvement in PRA's operating performance and liquidity over the past several quarters. Much stronger than expected free cash flow generation in recent quarters has allowed the company to repay all of the borrowings under its revolver and make a voluntary term loan repayment which has also improved the outlook for headroom under the company's financial covenants. The stable outlook is also supported by Moody's view that the fundamentals for the Contract Research Organization industry will be improving in 2010 versus 2009. Improvement in the biotech funding environment, general economic recovery and the continued integration of the pharmaceutical mega-mergers which took place in 2009 should lead to a more stable CRO operating environment over the next 12-18 months. PRA's Corporate Family Rating is B3, reflecting the contract cancellation risk that is inherent in the CRO business, coupled with the significant level of adjusted leverage and limited interest coverage. Further, the CRO industry is highly competitive and PRA's scale is mid-tier versus several much larger competitors. The ratings are supported by Moody's view that the long-term growth prospects for the CRO industry remain sound. Further, PRA's relatively good customer and geographic diversity, as well as its flexible cost structure should mitigate some of the contract cancellation risk. Ratings affirmed/LGD assessments revised: PRA International: -- $30 million senior secured revolving credit facility due 2013; B1, LGD3, 36% -- $70 million senior secured first-out term loan due 2014; B1, LGD3, 36% -- $85 million senior secured last-out term loan due 2014; B3, LGD5, 73% -- Corporate Family Rating; B3 -- Probability of Default Rating; B2 Pharmaceutical Research Associates Group, BV: -- $10 million senior secured revolving credit facility due 2013; B1, LGD3, 36% -- $100 million senior secured first-out term loan due 2014; B1, LGD3, 36% The outlook for the ratings is stable. The last rating action was on April 9, 2009, when Moody's changed PRA's outlook to negative from stable. PRA International is an international CRO that assists pharmaceutical and biotechnology companies in developing drug compounds, biologics, and drug delivery devices and gaining necessary regulatory approvals. The company was acquired by Genstar Capital in 2007. PRESSTEK INC: Posts $49.8 Million Net Loss for FY Ended Jan. 2 -------------------------------------------------------------- Presstek Inc. filed its Form 10-K, showing a net loss of $49.8 million on $134.4 million of total revenue for the fiscal year ended January 2, 2010, compared with a net income of $524,000 on $193.2 million of total revenue for the fiscal year ended January 3, 2009. The Company's balance sheet as of January 2, 2010, revealed $104.5 million in total assets and $47.6 million in total liabilities for a $56.8 million stockholders' equity. A full-text copy of the company's Form 10-K is available for free at http://ResearchArchives.com/t/s?5c34 About Presstek Greenwich, Connecticut-based Presstek, Inc. (NASDAQ: PRST) -- http://www.presstek.com/-- manufactures and markets high tech digital imaging solutions to the graphic arts and laser imaging markets. Presstek's patented DI(R), CTP and plate products provide a streamlined workflow in a chemistry-free environment, thereby reducing printing cycle time and lowering production costs. Presstek solutions are designed to make it easier for printers to cost effectively meet increasing customer demand for high-quality, shorter print runs and faster turnaround while providing improved profit margins. Presstek subsidiary, Lasertel, Inc., manufactures semiconductor laser diodes for Presstek's and external customers' applications. PRM REALTY: Wants to Hire Pronske & Patel as Bankruptcy Counsel --------------------------------------------------------------- PRM Realty Group, LLC, has asked for permission from the U.S. Bankruptcy Court for the Northern District of Texas to employ Pronske & Patel, P.C., as bankruptcy counsel. Pronske & Patel will, among other things: (a) take necessary action to protect and preserve the Debtor's estate, including the prosecution of actions on behalf of the Debtor, the defense of any actions commenced against the Debtor, negotiations concerning litigation in which the Debtor is involved, and objections to claims filed against the Debtor's estate; (b) prepare on behalf of the Debtor all necessary motions, answers, orders, reports, and other legal papers in connection with the administration of its estate; (c) assist the Debtor in preparing for and filing a disclosure statement; and (d) assist the Debtor in preparing for and filing a plan of reorganization at the earliest possible date. Gerrit M. Pronske, a shareholder with Pronske & Patel, says that the firm will be paid based on the hourly rates of its personnel: Gerrit M. Pronske $550 Rahkee V. Patel $375 Partners $330-$550 Associates $160-$225 Legal Assistants $100 Mr. Pronske assures the Court that Pronske & Patel is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Chicago, Illinois-based PRM Realty Group, LLC, filed for Chapter 11 bankruptcy protection on January 6, 2010 (Bankr. N.D. Tex. Case No. 10-30241). The Company's affiliates -- Peter R. Morris; Bon Secour Partners, LLC; PM Transportation, LLC; Rangeline Properties, LLC; PRS II, LLC; and Morris Radio Enterprises, LLC -- filed separate Chapter 11 bankruptcy petitions. PRM Realty listed $100,000,001 to $500,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. RADIOSHACK CORP: Exploring Strategic Options Including Asset Sale ----------------------------------------------------------------- Sources told The New York Post reports that RadioShack is exploring strategic alternatives including a possible sale of the company that could fetch more than $3 billion. People close to the situation told the Post that investment bankers have already begun pitching their private-equity clients about a leveraged buyout of RadioShack, notifying them of the retailer's willingness to sell. The Post also says another possibility is a merger with big-box rival Best Buy. The Post also says other options for RadioShack include using its $900 million cash to either initiate a "massive share buyback," or even make a strategic acquisition of its own. According to the Post, one source briefed on the situation, said JPMorgan Chase appears poised to lead the sales process for RadioShack. The source told the Post "it is very, very early" in the process, and any auction wouldn't likely begin for weeks or even months. The Post says billionaire Leon Black's Apollo Global Management has been rumored to be a suitor to RadioShack, but a person close to the situation said Apollo is not in talks with the retailer. About RadioShack RadioShack Corporation (NYSE: RSH), headquartered in Fort Worth, Texas, is a chain of consumer electronics specialty retail stores. RadioShack was acquired by the Tandy Corporation in 1963. In 1975, Tandy became exclusively an electronics company after it spun off all other operations. The company name was changed to RadioShack in 2000. * * * RadioShack carries Fitch Ratings' Long-term Issuer Default Rating at 'BB'; Bank credit facility at 'BB'; and Senior unsecured notes at 'BB'. RadioShack carries Standard & Poor's Ratings Services' (BB/Stable/--) ratings. The Company also carries Moody's Investors Service's "Ba1" Corporate Family Rating. RATHGIBSON INC: Court Okays Sale Process; May 19 Auction Set ------------------------------------------------------------ RathGibson Inc. received approval from the Bankruptcy Court of a sale process where a creditor group will buy the Debtors' assets, absent higher and better bids. Pursuant to an Asset Purchase Agreement dated March 8, 2010, RathGibson Acquisition Co., LLC -- formed by a group comprised by some of the existing secured lenders and holders of 70% of the $209.5 million in 11.25% unsecured notes -- has offered to pay $93 million cash and assume certain liabilities in exchange for RathGibson's assets. The sale of the assets is an integral part of the Second Amended Plan and consummation of the Plan is dependent upon consummation of the sale. To further market test the assets, RathGibson will hold a May 19 auction, with bids due May 12. Each bidder is required to, among other things (i) be prepared to consummate the sale on or before June 16, following entry of the plan confirmation order, and (ii) submit a $10 million deposit. The sale would be approved as part of the approval of the liquidating Chapter 11 plan at a May 21 confirmation hearing. Break-Up Fee Under the bid procedures, the Debtor contemplated that RathGibson Acquisition, as stalking horse bidder, will be entitled to a break-up fee of $2.79 million and expense reimbursement of up to $1 million in the event the Debtor consummates a sale with another party. According to Bill Rochelle at Bloomberg News, the bankruptcy judge has not yet decided if proposed breakup fees were appropriate. If another bidder wins the auction, the judge will decide about allowing a breakup fee at the hearing for approval of the sale. The U.S. Trustee objected, saying the possible breakup fees and expenses, totaling $5.54 million, were too high since they represented 5.9 percent of the sale price. About RathGibson Inc. Headquartered in Lincolnshire, Illinois, RathGibson Inc. -- http://www.RathGibson.com/, http://www.GreenvilleTube.com/ and http://www.ControlLine.com/-- is a worldwide manufacturer of highly engineered stainless steel, nickel, and titanium tubing for diverse industries such as chemical, petrochemical, energy -- power generation, energy -- oil and gas, food, beverage, pharmaceutical, biopharmaceutical, medical, biotechnology, and general commercial. Manufacturing locations include: Janesville, Wisconsin, North Branch, New Jersey, Clarksville, Arkansas (Greenville Tube), and Marrero, Louisiana (Mid-South Control Line). In addition to the sales offices in Janesville, North Branch, and Marrero, RathGibson has also strategically placed sales offices in Houston, Texas, USA; Shanghai, China; Manama, Bahrain; Melbourne, Australia; Seoul, Republic of Korea; Mumbai, India; Singapore; Vienna, Austria; and Buenos Aires, Argentina. RathGibson, Inc., together with three affiliates, filed for Chapter 11 on June 13, 2009 (Bankr. D. Del. Case No. 09-12452). Attorneys at Young, Conaway, Stargatt & Taylor and Willkie Farr & Gallagher LLP serve as co-counsel. Jefferies & Company Inc. and Mesirow Financial Consulting LLC have been hired as financial advisors. Kelley Drye & Warren LLP serves as special corporate counsel. Garden City Group is claims and notice agent. The petition says that Rathgibson has assets and debts of $100 million to $500 million. Scott Welkis, Esq., Kristopher M. Hansen, Esq., and Jayme T. Goldstein, Esq., at Stroock & Stroock & Lavan represent Wilmington Trust FSB, as administrative agent, and an ad hoc committee of certain holders of Senior Notes. Attorneys at Richards, Layton & Finger P.A., also represent the ad hoc noteholders committee. REDDY ICE: S&P Raises Corporate Credit Rating to 'B-' ----------------------------------------------------- Standard & Poor's Ratings Services said that it raised its corporate credit rating on Dallas, Texas-based Reddy Ice Holdings Inc. to 'B-' from 'SD', and its wholly owned operating company, Reddy Ice Corp., to 'B-' from 'CC'. Following the transaction, S&P withdrew the corporate credit rating on Opco. S&P also raised its ratings on Holdings' remaining senior discount notes (not exchanged) to 'CCC' from 'D'. The recovery rating on this debt remains unchanged at '6'. At the same time, S&P affirmed the 'B-' issue rating on Opco's $300 million secured first-priority Opco notes due 2015. The recovery rating remains at '3', indicating S&P's expectation for meaningful (50% to 70%) recovery in the event of a payment default. S&P also affirmed the 'CCC' issue rating on Opco's $139.4 million secured second-priority Opco notes due 2015. The recovery rating remains at '6', indicating S&P's expectation for negligible (0% to 10%) recovery for noteholders in the event of a payment default. The rating actions follow Reddy Ice's recent completed exchange transaction and refinancing. Reddy Ice's postexchange capital structure and bank refinancing increased its debt burden by about $60 million. Even so, it extended Reddy Ice's debt maturities and has provided liquidity to the company to not only withstand lingering weak macroeconomic conditions with greater capacity but also provides the company with capital to fund its growth initiatives. The ratings also reflect S&P's view that, given ongoing weak macroeconomic conditions, the company's weak operating results will continue. Despite the expectation that, pro forma for the transaction, Reddy Ice's liquidity position will improve, these weak operating results will likely lead to more constrained free cash flow generation in the near term. The ratings also incorporate the company's narrow product focus; participation in the highly fragmented and competitive packaged ice industry, which is susceptible to unfavorable economic and weather conditions; seasonal demand for its products; and a vulnerable financial profile. RICK BRUNSMAN: Files for Bankruptcy to Liquidate Businesses ----------------------------------------------------------- Business Courier of Cincinnati, reports that entrepreneur Rick Brunsman filed for Chapter 11 bankruptcy to liquidate his business interests. Mr. Brunsman listed $29 million in assets and $53 million in liabilities. Jon Newberry, staff reporter at Business Courier relates that Mr. Brunsman's businesses are no longer operating. Mr. Brunsman is expected to proceed to sell two estate entities: RBDB Investment LL and Harmony Park LLC. RBDB Investment has $10 million in asset and $12 million in liabilities, while Harmony Park has $12 million in assets and $4 million in claims. RIVIERA HOLDINGS: Ernst Young Raises Going Concern Doubt -------------------------------------------------------- On March 26, 2010, Riviera Holdings Corporation filed its annual report on Form 10-K for the year ended December 31, 2009. Ernst Young LLP, in Las Vegas, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring operating losses and has a working capital deficiency. In addition, the Company is in default under its Credit Facility and Swap Agreement. The Company reported a net loss of $24.9 million on $134.0 million of revenue for the year ended December 31, 2009, compared with a net loss of $11.9 million on $169.8 million of revenue for 2008. The Company's balance sheet as of December 31, 2009, showed $198.9 million in assets and $282.0 million of debts, for a stockholders' deficit of $83.1 million. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c8f Las Vegas, Nev.-based Riviera Holdings Corporation, through its wholly-owned subsidiary, Riviera Operating Corporation, owns and operates the Riviera Hotel & Casino located on the Las Vegas Boulevard in Las Vegas, Nevada. Through its wholly owned subsidiary, Riviera Black Hawk, Inc., the Company owns and operates the Riviera Black Hawk Casino, a casino in Black Hawk, Colorado. ROUNDY'S SUPERMARKETS: Moody's Puts 'Caa1' Rating on $150MM Debt ---------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Roundy's Supermarkets, Inc., following the company's announcement of a debt-financed dividend of $150 million planned to close in April 2010. Moody's also assigned a rating of Caa1 to the $150 million of new second-lien debt being used to finance the dividend, and changed the rating outlook to negative from stable. Moody's ratings reflect the expectation that Roundy's credit metrics, which will be stressed immediately following the dividend transaction, will return to more comfortable levels for the B2 Corporate Family Rating within a reasonable period as a result of using cash flow for debt reduction. The negative outlook reflects heightened risk of a ratings downgrade due to Roundy's reduced financial flexibility following the increase of $150 million in long term debt during a time of unstable industry conditions. Moody's ratings also reflect the change from a conservative financial policy to a fairly aggressive financial policy. This shift is demonstrated by two recent debt-financed dividends which weakened the company's financial profile at a time when the general operating environment for supermarkets was unstable. The affirmed B1 ratings on the first lien debt continue to reflect the benefit of their first lien position on essentially all of the company's assets. The Caa1 ratings of the second lien debt reflect its second priority relative to a substantial amount of senior liabilities. The Probability of Default Rating is being changed to B2 to reflect the change the overall loss given default due to the increased amount of debt in the new capital structure. Moody's affirmed these ratings for Roundy's: -- Corporate Family Rating at B2 -- Senior secured revolver due 2012 at B1 (LGD 3, 39% from LGD 2, 27%) -- Senior secured term loan B due 2013 at B1 (LGD 3, 39% from LGD 2, 27%) Moody's assigned this new rating to Roundy's: -- $150 million second lien term loan maturing 2016 rated Caa1 (LGD 5,79%). Moody's changed this rating of Roundy's: -- Probability of Default rating upgraded to B2 from B3 The last rating action for Roundy's was the assignment of ratings to its first lien credit facilities on October 26, 2009. ROUNDY'S SUPERMARKETS: S&P Gives Stable Outlook; Keeps 'B' Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Milwaukee-based Roundy's Supermarkets Inc. to stable from negative. At the same time, S&P affirmed the 'B' corporate credit rating on the company. At the same time, S&P raised the bank loan rating on the first- lien bank facility to 'B+', one notch higher than the corporate credit rating. The recovery rating is '2', reflecting S&P's expectation of a substantial (70%-90%) recovery in the event of a payment default. This action is primarily due to an increase in the EBITDA recovery multiple assumption to 5.5x from 5.0x. S&P also assigned a 'CCC+' rating (two notches lower than the corporate credit rating) to Roundy's proposed second-lien term loan. The recovery rating is '6', reflecting expectations of negligible (0%-10%) recovery in the event of a payment default. S&P expects the covenants under the bank facility to be amended such that the EBITDA covenant cushion under its tightest covenant will increase to about 17% on a pro forma basis, thus giving Roundy's significant relief from the current 5% EBITDA cushion under its senior leverage covenant. "The outlook revision to stable primarily reflects expectations that Roundy's will have increased cushion under its bank facility following the covenant amendments under its first-lien bank facility," said Standard & Poor's credit analyst Stella Kapur. The affirmation of the 'B' corporate credit rating reflects the following: S&P's belief that while credit metrics (pro forma for the proposed second-lien term loan issuance) will deteriorate from current levels, they will still remain adequate for the current rating given S&P's assessment that Roundy's business risk profile is fair. S&P expects that Roundy's credit metrics will gradually strengthen over time as free operating cash flow is utilized to pay down its first-lien bank facility with free operating cash flow. The amended first-lien bank facility will have a 100% cash flow sweep. S&P's view that Roundy's will not issue an additional dividend in the intermediate term; in exchange for the proposed amendments, the company will give up its right to issue up to $200 million of dividends that could have been financed with unsecured, junior debt. In addition, Roundy's cannot utilize free operating cash flow to issue dividends. Hence, S&P believes the company will not be able to issue an additional dividend in the intermediate term without obtaining lender approval and consent. The stable outlook primarily reflects expectations that Roundy's operations will remain stable and will have adequate liquidity. A lower rating could be considered if Roundy's starts to lose meaningful market share resulting in operating performance falling below S&P's expectations or if cushion under its senior leverage covenant falls below 5%. S&P could also revise the outlook to negative if the company is not successful in obtaining bank facility covenant amendments that it needs to maintain adequate covenant cushion under its bank facility. A higher rating is not likely to be considered in the intermediate term. SBARRO INC: Posts $37.3 Million Net Loss for 2009 ------------------------------------------------- Sbarro, Inc., filed its annual report on Form 10-K for 2009, showing a net loss of $37.3 million on $339.3 million of revenue for the year ended December 27, 2009, compared with a net loss of $90.6 million on $359.2 million of revenue for the year ended December 28, 2008. "The decrease in revenues was primarily due to a 4.9% decrease in Company-owned comparable-unit sales, lost sales from stores strategically closed and a decline in royalties on franchise sales, offset by revenues generated by new Company-owned stores opened in 2008 and 2009." Revenues were $94.0 million for the fourth quarter ended December 27, 2009, as compared to revenues of $98.7 million for the quarter ended December 28, 2008. Net loss was $884,000 for the fourth quarter of 2009, compared to a net loss of $82.0 million for the fourth quarter of 2008. The Company's balance sheet as of December 27, 2009, showed $490.4 million in assets, $444.7 million of debts, and $15.7 million of stockholders' equity. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c90 A full-text copy of the press release reporting the Company's financial results for the fourth quarter ended December 27, 2009, is available for free at http://researcharchives.com/t/s?5c91 About Sbarro Inc. Melville, N.Y.-based Sbarro, Inc. -- http://www.sbarro.com/-- is the world's leading Italian quick service restaurant concept and the largest shopping mall-focused restaurant concept in the world. The Company has 1,056 restaurants in 41 countries. * * * As of March 26, 2010, the Company carries Standard and Poors' CCC+ senior credit facility rating, CCC- Senior Notes rating, and CCC+ corporate rating. In July 2009, Moody's increased Sbarro's credit ratings to Caa1 from Caa2 on its senior credit facility, affirmed its C rating on its senior notes and affirmed its Ca corporate rating, which ratings hold to date. SENSATA TECHNOLOGIES: S&P Raises Corporate Credit Rating to 'B' --------------------------------------------------------------- Standard & Poor's Ratings Services raised the ratings on sensors and controls manufacturer Sensata Technologies B.V., including the corporate credit rating, to 'B' from 'B-'. S&P also removed the ratings from CreditWatch with positive implications. The outlook is positive. "The rating actions follows Sensata's announcement that it has finalized its debt tender offer (with about $96 million in principal tendered) and its reiteration of its intention to use a total of $350 million to retire debt, which will improve credit measures," said Standard & Poor's credit analyst Dan Picciotto. Following its completion of the tender offer, pro forma total adjusted debt to EBITDA as of Dec. 31, 2009, will remain high at about 7.2x. However, this figure would decline to less than 6.5x if the company is successful in using the full $350 million for debt repayment. "S&P believes business trends remain favorable, which should allow for further improvement in credit measures that could support higher ratings," he continued. The ratings on Sensata reflect its highly leveraged financial profile and fair business risk profile. The company's high debt level more than offsets its good geographic diversification and solid operating margins. Sensata remains highly leveraged, but has begun to generate better EBITDA due to improved market conditions and significant cost- cutting actions. S&P could raise the ratings if adjusted debt to EBITDA trends to less than 5x and funds from operations to total adjusted debt is expected to remain in excess of 10%. S&P could revise the outlook to stable if market conditions become unfavorable and limit improvement in credit measures. For instance, if S&P thought adjusted debt to EBITDA would remain around 6x, S&P could revise the outlook to stable. SIMON WORLDWIDE: Posts $2.1 Million Net Loss in 2009 ---------------------------------------------------- Simon Worldwide, Inc., filed its annual report on Form 10-K, showing a net loss of $2.1 million for 2009, compared with net income of $621,000 for 2008. The Company's balance sheet as of December 31, 2009, showed $15.4 million in assets, $768,000 of debts, and $14.7 million of stockholders' equity. BDO Seidman, LLP, in Los Angeles, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of Company has suffered significant losses from operations, has a lack of any operating revenue and is subject to potential liquidation in connection with the Recapitalization Agreement. A full-text copy of the annual report is available for free at: http://researcharchives.com/t/s?5c93 Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) was, prior to August 2001, operated as a multi-national full-service promotional marketing company, specializing in the design and development of high-impact promotional products and sales promotions. At December 31, 2009, the Company held an investment in Yucaipa AEC Associates, LLC, a limited liability company that is controlled by the Yucaipa Companies, a Los Angeles, California based investment firm. Yucaipa AEC in turn principally held an investment in the common stock of Source Interlink Companies, a direct-to-retail magazine distribution and fulfillment company in North America, and a provider of magazine information and front- end management services for retailers and a publisher of approximately 75 magazine titles. Yucaipa AEC held this investment in Source until April 28, 2009, when Source filed a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. SMURFIT-STONE: Proposes Winston & Strawn as Special Counsel ----------------------------------------------------------- Smurfit-Stone Container Corp. and its units ask the Court for authority to employ Winston & Strawn LLP as their special corporate and finance counsel, nunc pro tunc to October 1, 2009. Winston & Strawn is currently employed by the Debtors in the ordinary course of business and has been employed by the Debtors in connection with a wide range of legal matters since 1976. However, starting in September 2009, Winston began incurring fees in excess of the monthly ordinary course fee cap. Given that the amount of Winston & Strawn's legal work for the Debtors is increasing, the Debtors recently advised Winston & Strawn that they wish to retain the firm as their special corporate and finance counsel in the Chapter 11 cases. As the Debtors' special counsel, Winston & Strawn will provide services regarding these matters: a. the Debtors' exit financing and other financing matters that may arise; b. general corporate matters; c. ordinary course litigation; d. real estate matters; e. tax matters; f. employee benefits matters; and g. any other matters as the Debtors may specifically request during the pendency of the Chapter 11 Cases for which another law firm is not advising the Debtors. The Debtors seek to retain Winston & Strawn as special counsel at Winston & Strawn's customary hourly rates and reimbursement policies with a 10% discount on services rendered relating to their exit financing. In addition, previously agreed upon discounted hourly rates apply to Winston & Strawn's services in connection with a certain pending ERISA case. With respect to all other matters, Winston & Strawn's standard hourly rates will apply. Winston & Strawn's standard hourly rates range from $475 to $1,075 for all of its partners and $250 to $610 for all of its associates. The primary attorneys anticipated to work on the engagement and their current hourly rates are: Joseph A. Walsh - Partner $780 Brian S. Hart - Partner $700 Mark G. Henning - Partner $645 Andrea L. Briski - Associate $420 Timothy D. Kincaid - Associate $380 Kathy A. Homenda - Associate $305 Joseph A. Walsh, Jr., Esq., a member of Winston & Strawn, assures the Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. In a separate filing, James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, certifies that there were no objections to the Application as of March 4, 2010. Accordingly, the Court approved the Application. 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 US$7.450 billion in total assets and US$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: Panel Wants to Retain Fisher as Expert Witness ------------------------------------------------------------- The Official Committee of Unsecured Creditors from Smurfit-Stone Container Corp.'s cases asks the U.S. Bankruptcy Court for authority to retain Fisher International, Inc. as its industry expert and potential expert witness in connection with the Chapter 11 cases, nunc pro tunc to February 3, 2010. The Committee determined that the expert industry services of Fisher are necessary to enable the Committee to evaluate the Debtors' business plans and projections in preparation for the confirmation hearing of their Chapter 11 Plan of Reorganization. Accordingly, Fisher will perform consulting and offer expert services to the Committee including, but not limited to: -- reviewing and analyzing the Debtors' business plans and projections; -- if asked, preparing an expert report; and -- if asked, being available to testify at depositions or at trial. The Committee notes that it will be primarily using the services of Rodney N. Fisher, president of Fisher, as its industry expert. In exchange for its services, Fisher will be paid based on its current hourly rates: Rodney N. Fisher $600 Senior Consultants $525 Modeling Team $475 Associate Consultants $400 Administrative Staff $150 Mr. Fisher assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. In a separate filing, Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, certifies that there are no objections or responses to the Application as of March 8, 2010. Subsequently, the Court approved the Application. 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 US$7.450 billion in total assets and US$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: FTI to Provide Valuation Services to Panel --------------------------------------------------------- The Official Committee of Unsecured Creditors from Smurfit-Stone Corp.'s cases asks the U.S. Bankruptcy Court for authority to expand the scope of retention of FTI Consulting, Inc., currently its financial advisor, to provide the Committee with expert valuation services, nunc pro tunc to February 3, 2010. The additional expert valuation services that FTI will provide will include, but will not be limited to: -- reviewing and analyzing the Debtors' valuation model; -- reviewing and analyzing any competing valuations; -- preparing an independent valuation; -- preparing an expert report on valuation; and -- if asked, being available to testify at depositions or at trial on valuation. For the Additional Services, FTI will be paid a fixed fee of $600,000, payable after the conclusion of the Confirmation Hearing. In a separate filing, Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, certifies that there are no objections to the Committee' application as of March 8, 2010. Subsequently, the Court approved the Application. 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 US$7.450 billion in total assets and US$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: Monitor Files 11th Report on Canada Unit ------------------------------------------------------- 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 11th 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 11th Report is to provide the Court with an update in respect of the claims process and an overview of the Chapter 11 Plan of Reorganization submitted by Smurfit-Stone Container Corporation in the United States Bankruptcy Court of the District of Delaware, as well as to comment on the Plan filing and a certain meeting order being sought by the CCAA Entities. According to the report, there are approximately 4,750 claims that did not specify a particular debtor. SSCC and the Monitor are in the process of reviewing the Proofs of Claim filed against the CCAA Entities, as well as the claims that have not specified a specific debtor, the Monitor relates. SSCC anticipates completing its review of all of the claims filed against the U.S. Debtors by February 28, 2010, the Monitor notes. It adds that a more fulsome analysis of claims will be provided at a later date as part of an analysis of the Plan. The Monitor further notes that as of February 9, 2010, 142 notices of revision or disallowance have been issued that have not been resolved. In addition, SSCC has identified 101 claims against the CCAA Entities as contingent or unliquidated, five of which were filed against all of the U.S. Debtors in relation to various pension and retirement plans of the CCAA Entities. Since early December, the Monitor has had ongoing discussions with SSCC and its advisors regarding the valuation of the Canadian assets, the composition of the secured and unsecured debt, intercompany balances, taxing authority claims and how each are to be treated in the Plan. On December 4, 2009, SSCC and its advisors provided the Monitor with its first draft of an illustrative recovery waterfall that provided preliminary estimates of value for SSC Canada and Smurfit-MBI prior to the resolution of the review and admittance of claims. The Monitor reveals that the key elements of the illustrative recovery waterfall included the repayment of the Canadian pre- filing secured facility in full since the Canadian security covers all of the assets of SSC Canada and SMBI. The Monitor says that it has reviewed the assumptions underlying SSCC's valuation to assess the reasonableness of the total Canadian asset valuation assigned by SSCC and its advisors. In addition, the Monitor relates that it has prepared its own going concern valuation range using a discounted cash flow and market based analysis as well as the value of the working capital and non-core assets. A full-text copy of the Monitor's 11th Report is available for free at http://bankrupt.com/misc/SSC11thMonRep.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 US$7.450 billion in total assets and US$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) SPECIALTY PACKAGING: Authorized to Sell Assets for $14 Million -------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Specialty Packaging Holdings Inc., Cosmetic Specialties Inc. and affiliates received approval from the Bankruptcy Court to sell their color cosmetic development and manufacturing business for about $14 million to an affiliate of Schwan-Stabilo Cosmetics GmbH. Lewisburg, Tennessee-based Specialty Packaging Holdings, Inc., is a color cosmetic developer and manufacturer. The Company, Cosmetic Specialties Inc. and affiliates filed for Chapter 11 bankruptcy protection on January 20, 2010 (Bankr. Del. Case No. 10-10142). Dominic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, assists the Company in its restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. The meeting of creditors pursuant to Section 341 of the Bankruptcy SPHERIS INC: May Pay Bonuses After Secured Claims Are Paid ---------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Spheris Inc. obtained approval to pay up to $850,000 in bonuses for 25 employees and five top executives. According to the report, payment to the executives under the program is contingent on the sale of the Debtors at an auction slated for April 13. Subsidiaries of CBay Holding Ltd. have offered $75.25 million cash for the assets. At auction, lenders will be able to bid using their pre- and post-bankruptcy loans rather than cash. The Bloomberg report relates that Spheris will be permitted to pay bonuses only after claims of senior secured lenders have been paid in full. About Spheris Inc. Based in Franklin, Tennessee, Spheris Inc. -- http://www.spheris.com/-- is a global provider of clinical documentation technology and services. Spheris Inc., along with five affiliates, filed for Chapter 11 on Feb. 3, 2010 (Bankr. D. Del. Case No. 10-10352). Attorneys at Young Conaway Stargatt & Taylor, LLP, and Willkie Farr & Gallagher LLP represent the Debtors in their Chapter 11 effort. Jefferies & Company serve as financial advisors to the Debtors. Attorneys at Schulte Roth & Zabel LLP and Landis Rath & Cobb LLP serve as counsel to the prepetition and DIP lenders. Garden City Group Inc. is claims and notice agent. The petition says that assets range from $50,000,001 to $100,000,000 while debts range from $100,000,001 to $500,000,000. STANDARD PACIFIC: S&P Raises Corporate Credit Rating to 'B' ----------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Irvine, Calif.-based homebuilder Standard Pacific Corp. to 'B' from 'CCC+'. The upgrade acknowledges improvement in the company's cost structure, as well as previous success in addressing near-term maturity risk. At the same time, S&P raised its ratings on $872 million of senior and subordinated notes and revised its outlook on the company to stable from positive. "S&P raised its rating on Standard Pacific because S&P believes improvements in the company's cost structure could contribute to near-breakeven net earnings even if the nascent housing market recovery stalls and Standard Pacific's home sales are comparable to 2009's levels," said Standard & Poor's credit analyst James Fielding. "Our rating also acknowledges manageable near-term debt maturities and a meaningful cash balance. That being said, the company remains aggressively leveraged, in S&P's opinion, and it does not currently have committed revolving borrowing capacity to supplement its liquidity." The outlook is stable and incorporates S&P's expectation that the company may draw down its current cash balances to fund opportunistic land purchases. It is unlikely that S&P would raise its rating on Standard Pacific over the next year because S&P does not believe market conditions will improve sufficiently to support the improved sales velocity necessary to generate meaningful net profits. However, S&P would lower its rating if the market unexpectedly worsens and Standard Pacific's net loss widens materially and its operations steadily burn cash, or if the company uses more of its cash than S&P anticipate to fund opportunistic land purchases. SUNTRUST BANKS: Fitch Downgrades Long-Term Issuer Default Ratings ----------------------------------------------------------------- Fitch Ratings has downgraded the long-term Issuer Default Ratings of SunTrust Banks, Inc, and bank subsidiary, SunTrust Bank to 'BBB+'. The Rating Outlook is Stable. The downgrade of STI's ratings reflects continued credit stress and the expectation that STI will continue to be hampered by elevated credit costs over the intermediate term making it difficult for them to return to profitability in 2010 and possibly into 2011. Fitch believes that STI's persistently weak credit and performance metrics does not compare well to its peers and is not commensurate with an 'A-' rated company. STI remains vulnerable to higher loss rates in its mortgage and home equity portfolios, as well as its commercial real estate portfolio, which would add further stress on earnings and could weaken STI's capital base. Despite STI's seemingly stabilizing credit trends and that the company's higher risk residential mortgage, home equity, and residential construction portfolios have declined and are not expected to generate the same level of losses going forward. Fitch is concerned that persistent economic stress in STI's primary markets of Florida and Georgia will have a more significant impact on the company's significantly larger core mortgage and home equity portfolios, which have performed relatively well to date. Further, while STI's exposure to commercial real estate, a key area of concern for the U.S. banking sector, are forecasted to trend below Fitch's stress scenarios given its highly granular and largely owner occupied composition, Fitch still believes that losses in this portfolio will escalate. The Stable Outlook reflects Fitch's belief that STI has sufficient financial resources, in terms of capital, reserves, and pre- provision net revenue, relative to its current ratings, to absorb the expected higher loss rates in the portfolio over the near to intermediate term. Additionally, STI's ratings are underpinned by its sizeable branch franchise which provides a solid core funding base and contributes to the company's healthy liquidity position. Separately, STI may look to repay its preferred stock issued as part of the US Treasury's Capital Purchase Program in 2010. However, while STI has the financial resources to repay the CPP, Fitch expects that the company will need to raise a certain amount of common equity to receive approval for repayment. Given the current credit environment, as well as STI's recent record of losses, Fitch would view the raising of additional common equity as prudent and necessary to maintain a sound capital position, as well as to improve the quality of its capital structure. STI is among the largest banking companies in the US with about $175 billion in assets and 1,700 branches. The company's footprint is focused in the southeastern and mid-Atlantic regions of the U.S. The company has a balanced consumer and commercial banking franchise, as well as a national mortgage banking franchise and a sizeable wealth and investment management business. Fitch has taken these rating actions on STI and its subsidiaries: SunTrust Banks, Inc. -- Long-term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable -- Short-term IDR downgraded to 'F2 'from 'F1'; -- Senior debt downgraded to 'BBB+' from 'A-'; -- Subordinated debt downgraded to 'BBB' from 'BBB+'; -- Preferred stock downgraded to 'BBB-' from 'BBB'; -- Short-term debt downgraded to 'F2' from 'F1'; -- Long-term debt guaranteed by TLGP affirmed at 'AAA'; -- Short-term debt guaranteed by TLGP affirmed at 'F1+'; -- Individual affirmed at 'C'; -- Support affirmed at '5'; -- Support floor affirmed at 'No Floor'. SunTrust Bank -- Long-term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable; -- Short-term IDR downgraded to 'F2' from 'F1'; -- Long-term debt guaranteed by TLGP affirmed at AAA'; -- Short-term debt guaranteed by TLGP affirmed at F1+'; -- Long-term deposits downgraded to 'A-' from 'A'; -- Short-term deposits downgraded to 'F2' from 'F1'; -- Senior debt downgraded to 'BBB+' from 'A-'; -- Subordinated debt downgraded to 'BBB' from 'BBB+'; -- Short-term debt downgraded to 'F2' from 'F1'; -- Individual affirmed at 'C'; -- Support affirmed at '3'; -- Support floor affirmed at 'BB-'. SunTrust Capital I SunTrust Capital III SunTrust Capital VIII SunTrust Capital IX -- Preferred stock downgraded to 'BBB-' from 'BBB'. SunTrust Preferred Capital I -- Preferred stock downgraded to 'BBB-' from 'BBB'. National Commerce Capital Trust I -- Preferred stock downgraded to 'BBB-' from 'BBB'. SUNWEST MANAGEMENT: $1.3-Bil. from Blackstone Group Leads Bidding ----------------------------------------------------------------- Sunwest Management, now known as Stayton SW Assisted Living, disclosed that U.S. District Court Judge Michael Hogan has approved an agreement to sell 149 senior housing facilities to a joint venture formed by Blackstone Real Estate Advisors VI L.P., Emeritus Senior Living, and Columbia Pacific Advisors. The Blackstone / Emeritus Joint Venture will become the stalking horse bidder in a bankruptcy auction to be held on or about May 17, 2010. The transaction is valued at $1.3 billion and includes a combination of cash, securities, and assumption of debt. The Blackstone / Emeritus Joint Venture will purchase most of the assets of the consolidated Sunwest enterprise. Existing investors and other claimants in the bankruptcy estate will be permitted to exchange their claims for either cash or up to 49% of the units in the venture. "This is a very promising transaction for Sunwest's investors and other creditors of the bankruptcy estate, for which we all owe thanks to Judge Hogan and individuals he has appointed," said Chief Restructuring Officer Clyde Hamstreet. "He employed an effective mediation strategy, using [retired Lane County Circuit Court Judge] Lyle Velure as mediator, to resolve most of the financial and legal complexities and disputes. This allowed hundreds of Sunwest entities that were on the verge of liquidation to be consolidated into a single viable business. That act alone created significant value for the estate to the benefit of investors, lenders, and other creditors." Investor groups also endorsed the Court's handling of the case. "If it were not for Judge Hogan's concern for investors, his belief in the company, and his willingness to stand up to secured lenders seeking to foreclose on their collateral, most of us investors would have lost everything," said Bill Bryan, Chairman of the Management Committee, which consists of investor representatives. "Instead, we are looking forward to prospects of a meaningful return of our investments. Judges Hogan and Velure, the professionals working on this case, and the combined creditors' committees have done a terrific job in making that possible." The Court selected the Blackstone / Emeritus Joint Venture as stalking horse bidder over a competing proposal from AEW Capital Management, which sought to make a preferred investment in the reorganized company. The two proposals were brought forward to the Court by the Chief Restructuring Officer, Receiver Michael Grassmueck, and the Management Committee after months of negotiations. Earlier in March, the Court appointed an independent expert, Bettina Whyte of Bridge Associates, LLC, to facilitate final negotiations with both Blackstone and AEW and assist in evaluating the competing proposals. "The final stages of negotiations resulted in a major gain to the bankruptcy estate," Hamstreet said. "Both bidders improved their offers dramatically. The real winners are the investors and creditors of Sunwest. Claimants who want cash will be able to receive cash, while those who want to preserve their tax status or share in the reorganized company's future potential will be able to roll their existing investments into the new venture. We have been working very hard to provide this choice to investors and are grateful to the Court, Ms. Whyte, and others involved for their roles in bringing about this positive result." The Court approved bid procedures to govern an upcoming six week bidding period, and is expected to appoint an investment banker to advise the estate during the bidding and auction process. As lead bidder, the Blackstone / Emeritus Joint Venture will have customary overbid protection and will receive break-up fees if another bidder makes the highest and best bid at the auction. Closing of the sale will be subject to customary conditions, confirmation of Sunwest's plan of reorganization, completion of loan modifications, and transfers of operating licenses. Closing is expected to occur in July 2010. About Sunwest Management Founded in Oregon in 1991, Sunwest Management -- http://www.sunwestmanagement.com/-- remains one of the largest private senior living providers in the country and is a significant Oregon employer. In 2008, the company engaged Hamstreet & Associates and Alvarez & Marsal to serve as financial advisors. Clyde Hamstreet is founder and principal of Hamstreet & Associates, a Portland-based, nationally recognized turnaround firm that is leading the effort to provide quality care, preserve value, and help Sunwest meet its obligations to creditors and investors. Michael Grassmueck is the founder and principal of Grassmueck Group, a national firm that specializes in fiduciary and insolvency services, which is based in Portland, Ore. He has served as a trustee in bankruptcy and as fiduciary in the state and federal courts in thousands of cases for more than 25 years. In March 2009, U.S. District Judge Michael Hogan appointed Michael Grassmueck as receiver after the Securities and Exchange Commission filed suit against Sunwest and former CEO Jon Harder, alleging securities fraud. The Company engaged Clyde Hamstreet as chief restructuring officer in late November 2008 to serve as CRO, an appointment continued in March by the U.S. District Court after the SEC lawsuit was filed. Sunwest Management has put 10 assisted living centers -- two in Oregon -- into Chapter 11 bankruptcy. Briarwood Retirement and Assisted Living Community LLC, which owns a retirement center in Springfield, and Century Fields Retirement and Assisted Living Community LLC, which owns a center in Lebanon, filed for Chapter 11 on Aug. 19, 2008. On Aug. 17, 2008, eight Sunwest-affiliated LLCs filed for Chapter 11 bankruptcy protection from creditors in Tennessee. TLC VISION: Plan Scheduled for May 5 Confirmation Hearing --------------------------------------------------------- TLC Vision Corp. will present its reorganization plan for approval at a confirmation hearing scheduled for May 5. TLC Vision is sending its reorganization plan to creditors for voting after it received approval of the explanatory disclosure statement. As reported by the TCR on Feb. 22, 2010, the Plan provides for the distribution of the proceeds derived from the sale of the Debtors' assets. Holders of secured will receive full payment. Holders of general unsecured claims will also be paid in full -- 90% in cash, and the remaining 10% through a note. In the original iteration of the Plan, holders of general unsecured claims against TLC USA were to recovery only recover 10%. A full-text copy of the amended Disclosure Statement is available for free at http://bankrupt.com/misc/TLCVision_AmendedDS.pdf A full-text copy of the amended Plan of Reorganization is available for free at: http://bankrupt.com/misc/TLCVision_AmendedPlan.pdf TLCVision -- http://www.tlcvision.com/-- is North America's premier eye care services company, providing eye doctors with the tools and technologies needed to deliver high-quality patient care. Through its centers' management, technology access service models, extensive optometric relationships, direct to consumer advertising and managed care contracting strength, TLCVision maintains leading positions in Refractive, Cataract and Eye Care markets. TLC Vision (USA) Corporation, and two of its corporate affiliates filed petitions for Chapter 11 on Dec. 21, 2009 (Bankr. D. Del. Case No. 09-14473). The petition says assets and debts are $100 million to $500 million. The Company's lead U.S. restructuring counsel is the law firm of Proskauer Rose LLP and Canadian restructuring counsel is the law firm of Torys LLP. The Company's financial advisor is Conway Del Genio Gries & Co., LLC. Epiq Bankruptcy Solutions is claims and notice agent. TOYS "R" US: Posts $312 Million Net Income Qtr. Ended Jan. 30 ------------------------------------------------------------- Toys "R" Us Inc. reported financial results for its fourth quarter and fiscal year ended January 30, 2010. For the 2009 fiscal year ended January 30, 2010, the Company reported net earnings of $312 million, an increase of 43.1% compared to net earnings of $218 million for the 2008 fiscal year. Net earnings for the fourth quarter were $387 million, compared to net earnings of $345 million for the fourth quarter of fiscal 2008. The Company's balance sheet showed $8.5 billion in total assets, $2.7 billion in total current liabilities, $5.0 billion in long- term debt, $63.0 million in deferred tax liabilities, $275.0 million in deferred rent liabilities, and $323.0 million in other non-current liabilities, for a $117.0 million stockholders' equity as of January 30, 2010. Fiscal 2009 operating earnings increased to $784 million from $621 million for fiscal 2008. EBITDA for the year was $1.168 billion, the highest in the history of the Company since it was founded in 1948. Adjusted EBITDA for fiscal 2009 increased to $1.062 billion, up from $1.002 billion in fiscal 2008. This marks the third consecutive year the company has delivered Adjusted EBITDA of over a billion dollars. A detailed description and reconciliation of EBITDA and Adjusted EBITDA are set forth at the end of this announcement. "Our strong financial results for fiscal 2009 reflect the ongoing successful execution of our long-term strategy. The Toys"R"Us brand is unique and robust, and we were able to build momentum throughout the year by focusing on our core strengths and by being innovative in our offerings to customers," said Jerry Storch, Chairman and CEO. "The continued integration of our toy and juvenile businesses and our focus on differentiated product offerings have helped drive our growth. Also, throughout the year, we continued to open new stores nationally and internationally, and to convert others to our side-by-side format. We are grateful to our customers and to our business partners who are supporting our growth as the world's leading specialty retailer of toys and baby products. There can be no doubt that our team was 'Playing to Win' in 2009." Consolidated Financial Results For the fourth quarter of fiscal 2009, net sales increased 7.3% to $5.857 billion from $5.461 billion for the fourth quarter of fiscal 2008. The strong fourth quarter sales performance was driven by comparable store sales increases in the company's Domestic and International segments of 3.3% and 0.1%, respectively. Fiscal 2009 total net sales were $13.568 billion versus $13.724 billion in fiscal 2008. For the full year, comparable store sales decreased by 3.0% and 2.8% for the Domestic and International segments, respectively. The strongest total sales increases were experienced in toy categories. The largest sales decline was in the entertainment product category, reflecting the cyclical downturn in this business. In addition, stores recently opened or converted to the side-by-side and "R" Superstore formats performed well. Foreign currency translation increased fourth quarter and full year sales by $196 million and $83 million, respectively. Fiscal 2009 gross margin, as a percentage of net sales, improved to 35.2% compared to 34.6% in fiscal 2008. SG&A expenses for the year were well controlled and decreased by 3.3% or $126 million. Other income saw a net decline of $16 million to $112 million in fiscal 2009. Other income for fiscal 2009 benefited from a $51 million favorable litigation settlement and a reduction of $26 million of store impairment charges as compared to fiscal 2008. Other income for fiscal 2008 benefited from $59 million due to a change in accounting for gift card liabilities and the recognition of $39 million of foreign currency translation benefit associated with the liquidation of the company's Hong Kong subsidiary. Interest expense for fiscal 2009 increased by $28 million, driven primarily by financing costs related to the repayments of the Company's $1.3 billion unsecured credit agreement and $800 million secured real estate loans, as well as higher interest rates on new debt. Income tax expense increased by $33 million, primarily due to the increase in pre-tax earnings. Cash Flow and Balance Sheet Update The Company ended the year with approximately $1.1 billion in cash. Additionally, at fiscal year-end 2009, the company had unused credit lines with availability of approximately $1.2 billion, including approximately $362 million that was available solely to the company's subsidiary in Japan. In total, the company's liquidity at fiscal 2009 year-end was in excess of $2.3 billion. Cash flow from operating activities for fiscal 2009 was $1,014 million, up 93% from the prior year. The major factors in this increase were improved payables support and rising net earnings. Cash used in investing activities decreased, reflecting a decline in capital spending and the release of restricted cash associated with the retirement of the Company's $2.1 billion of real estate debt in fiscal 2009. Cash used in financing activities was up in fiscal 2009 by $403 million, due mainly to the net reduction in debt associated with the Company's refinancing activities. Shareholder equity at the end of fiscal 2009 was $117 million, as compared to a shareholder deficit of $152 million at the end of fiscal 2008. A full-text copy of the Company's Earnings Release is available for free at http://ResearchArchives.com/t/s?5c68 A full-text copy of the Company's Form 10-K is available for free at http://ResearchArchives.com/t/s?5c8b Toys "R" Us, headquartered in Wayne, New Jersey, is the largest specialty retailer of toys, with annual revenues of around $14 billion. It operates stores both in the U.S. and internationally, as well as the Babies "R" Us format. TRIBUNE CO: Gets Nod for $30-Million Letter of Credit Deal ---------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware authorized Tribune Company and its debtor affiliates to enter into Amendment No. 3 to the Postpetition Letter of Credit Agreement dated as of December 8, 2008. Barclays Bank PLC, as postpetition agent and issuing bank, together with a syndicate of other financial institutions, will provide up to $30,000,000 in financing under the LC Agreement. The Debtors relate that on November 19, 2009, they repaid the then-current outstanding balance of the loans under the RLA of $170,000,000, of which $150,000,000 represented term loan borrowings and $20,000,000 represented the revolving line of credit borrowings. According to the Debtors, amounts repaid under the term loan were not available to be reborrowed, but they maintained the $75,000,000 revolving credit, subject to the conditions in the Extended Securitization Facility, including continued payment of a commitment fee on the unused portion of the revolving line of credit. Kate J. Stickles, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware, relates that the Debtors during the course of their Chapter 11 cases have accrued an available cash balance of approximately $1.42 billion as reported in the January 31, 2010 monthly operating report for Debtor Tribune Company. Given their significant available cash on hand, the Debtors no longer require the remaining, unused Extended Securitization Facility, and have terminated the securitization portion of the Amended Facilities, Ms. Stickles maintains. On February 25, 2010, the Debtors provided written notice of termination to Barclays that the borrower, Tribune Receivables, LLC, had elected to reduce the Revolving Commitments under the RLA to zero effective on February 26, 2010. The notice resulted in a Facility Termination Date of February 26, 2010, and a Final Payout Date of March 1, 2010, at which time the Debtors paid the Administrative Agent $12,500 in remaining fee obligations under that facility. The terms of the final payout and termination of the Extended Securitization Facility is available for free at: http://bankrupt.com/misc/Tribune_PayoutTermPact.pdf Mr. Stickles says the Debtors do not believe that Bankruptcy Court approval is required for the Termination Agreement, which was executed pursuant to the agreements previously approved under the Financing Orders. The Termination Agreement specifically provides that in reference to Financing Orders, the interest of the Administrative Agent and Lenders in the Collateral will be released. The Guaranty will remain in effect with respect to any Transaction Party Obligations arising from a term or provision of the RLA that by its terms survives termination of that agreement. Ms. Stickles tells the Court that although the Debtors have terminated the Extended Securitization Agreement, they intend to further amend and extend the Amended Letter of Credit Facility according to the terms provided for in Amendment No.3 to the Letter Agreement, a full-text copy of which is available for free at http://bankrupt.com/misc/Tribune_Am3LCA.pdf The Debtors assert that the Termination Agreement is not intended to modify or release any lien or interests of the Administrative Agent and the Lenders in the LC Cash Collateral, which will continue in full force and effect. The Debtors accordingly sought the Court's authority to, among others: (a) enter into Amendment No. 3 to the Letter of Credit Agreement, which, among other things, reduce the Commitment Amount to $30,000,000; (b) extend the Termination Date to the earlier to occur of (i) April 9, 2011, or (ii) other date on which the Commitments terminate pursuant to Section 9 of the Amended Letter of Credit Agreement; (c) continue to perform their reimbursement and other obligations under, and provide the required LC Cash Collateral under, the Letter of Credit Agreement, in an amount at least equal to 105% of the aggregate amount of Letter of Credit Liabilities; (d) grant to the LC Agent, the Issuing Bank and the Lenders priority in payment with respect to the obligations of Debtor Tribune Company and the other Debtors under the Amended Letter of Credit Agreement over any and all administrative expenses of the kind as specified in Sections 503(b) and 507(b) of the Bankruptcy Code other than in respect of the Carve-Out; and (e) continue the prior relief granted under the Final Financing Order and the Second Financing Order pertaining to the Amended Letter of Credit Facility. Judge Carey further authorized the Debtors and Barclays Bank to file under seal the Fee Letter related to the Amended Letter of Credit Facility. Prior to the entry of the Court's orders, the Debtors certified to the Court that no objections were filed as to the Motion to Amend Letter of Credit Agreement and the Joint Motion to file under seal a Fee Letter related to the Amended Letter of Credit Facility. Removal Period Until July 1 Meanwhile, Judge Kevin Carey has extended the Debtors' deadline to file notices of removal of claims and causes of action through July 1, 2010. Prior to the entry of the Court's order, the Debtors certified to the Court that no objection was filed as to the request. About Tribune Co. eadquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Incentive Plan Proposal Dismissed with Prejudice ------------------------------------------------------------ The Washington-Baltimore Newspaper Guild and Roberta A. DeAngelis, Acting U.S. Trustee for Region 3, oppose Tribune Co.'s request for the dismissal, without prejudice, of their motion seeking authority to implement the Transition Management Incentive Plan and Key Operators Bonus programs. The Guild asserts that the Debtors' request for dismissal of the TMIP and KOB should be approved only if the dismissal is "with prejudice." The Guild contends that a dismissal "without prejudice" is widely treated as if the action had not been brought in the first place. The Guild notes that in this instance, the matter was heavily litigated, has been fully tried as a contested matter, and is pending a ruling from the Court. Accordingly, the Guild asks the Court to issue an order approving the withdrawal with prejudice. Ms. DeAngelis maintains her position that the TMIP and the KOB were excessive remains unchanged. According to Ms. DeAngelis, the Motion is problematic for two reasons: (a) In the event that the Debtors request the same relief in the future, the Debtors do not address whether the record of the September 24, 2009 hearing will be preserved for the benefit of the objecting parties, or whether there will be limits placed upon the development of any supplemental record. (b) The Debtors sought approval of the Bonus Motion outside of the plan process. Accordingly, the Debtors are estopped from arguing that approval of the same relief to what was requested in the Bonus Motion would be integral to confirmation of any subsequently-filed chapter 11 plan. In the event that the Debtors request the same relief via a Chapter 11 plan, the Motion does not address whether the request for approval of the bonuses would be expressly severable from the remainder of the plan in order to insulate the objectors from any claim of equitable mootness on appeal. Debtors Respond to Objections The Debtors contend that there is no basis for repudiating the explicit legal presumption that a voluntary dismissal is without prejudice. They argue that the fact that the parties have litigated the 2009 Incentive Motion does not change that result. The Debtors aver that the Guild's demand that dismissal be with prejudice runs directly counter to the Court's suggestion at the January 27, 2010 hearing to the extent that a dismissal allegedly would or could impair the Debtors' ability to incorporate the TMIP and the KOB in a Chapter 11 plan of reorganization. The Debtors maintain that their intent is to incorporate the TMIP and the KOB into a plan of reorganization in the form in which those programs were proposed in the 2009 Incentive Motion. * * * Judge Carey dismissed without prejudice the Debtors' motion to implement the 2009 Management Incentive Plan and pay earned 2008 Management Incentive Plan Awards to certain executives with respect to the Transition MIP and the Key Operators Bonus components of the Debtors' proposed 2009 Management Incentive Plan. Judge Carey held that the relief requested in the Motion is in the best interests of the Debtors' estates, their creditors and other parties-in-interest. About Tribune Co. eadquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Wants WTC Held in Contempt for Filing Lawsuit --------------------------------------------------------- Tribune Co. and its units ask the Bankruptcy Court to determine that Wilmington Trust Company has violated the automatic stay and require Wilmington Trust to show cause why it should not be held in contempt. As previously reported, Wilmington Trust filed a complaint against, among others, JPMorgan Chase Bank, N.A., the administrative agent for the $8.028 billion Credit Agreement, dated May 17, 2007. The Complaint sought equitable subordination and disallowance of claims, damages, and constructive trust against multiple defendants. The Complaint made allegations with respect to the 2007 Leveraged ESOP Transactions involving Tribune Company and the actions taken by certain of Tribune's lenders. "The Complaint is an obvious and willful violation of the automatic stay by purporting to assert causes of action belonging to the Debtors' estates," asserts Norman L. Pernick, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware. "Wilmington Trust's action also flouts the Court's recent explicit directive that the parties should, for the time being, be permitted to continue their efforts to negotiate a consensual plan of reorganization without the distractions attendant to litigation, and is a transparent effort to thwart those negotiations," he adds. The Debtors further ask the Court to halt the Complaint. Allowing Wilmington Trust to proceed would unquestionably do violence to the consensual plan formulation process, the Debtors aver. About Tribune Co. eadquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) UAL CORP: Sees 'Real Signs of Recovery' in Pacific -------------------------------------------------- Bloomberg News reports that UAL Corp.'s United Airlines said it's seeing a rebound in bookings for flights across the Pacific, the carrier's largest region by passenger traffic outside the U.S. "There are real signs of recovery," Chief Executive Officer Glenn Tilton said in Beijing March 29. "The Pacific is showing its traditional strength. It's moving at a higher level compared to our other international markets." United is "very encouraged" by demand for trans-Pacific flights for the first quarter and beyond, Mr. Tilton said at a signing ceremony for a service agreement with Aircraft Maintenance & Engineering Corp., a joint venture between Air China Ltd. and United alliance partner Deutsche Lufthansa AG. Historic Agreement Meanwhile, United Airlines said it is applauds United States and European Union negotiators for concluding an historic agreement that will further liberalize the transatlantic market and enable airlines and their alliance partners greater commercial flexibility to better serve their customers. "United fully supports this important milestone that reinforces the strong bond that exists between the US and EU, promises greater cooperation on environment, security, competition and other important areas and believe it should serve as model in other regions of the world," said Glenn Tilton, United Airlines chairman and CEO. "United applauds negotiators on both sides of the Atlantic for their leadership and vision." About UAL Corporation 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 Dec. 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. Judge Eugene R. Wedoff confirmed a reorganization plan for United on Jan. 20, 2006. The Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) UAL Corp. carries a 'Caa1' probability of default rating from Moody's, 'B-' long term foreign issuer credit rating from Standard & Poor's, and 'CCC' long term issuer default rating from Fitch. WASHINGTON MUTUAL: Senior Bondholders Oppose JPM Settlement ----------------------------------------------------------- Senior bondholders of Washington Mutual Bank expressed their collective support for the Federal Deposit Insurance Corporation's decision, as reported by the Wall Street Journal, to reject a settlement proposed by JPMorgan Chase and Washington Mutual Inc. as not reflecting the discussions between the parties. Although the proposed settlement would resolve certain claims relating to the WaMu receivership estate and WMI's bankruptcy proceedings, the senior bondholders consider it to be unacceptable. "JPMorgan Chase is claiming $2.6 billion in tax refunds created by the stimulus bill that it does not own and which Congress intended to go to others. WaMu bondholders do not support JPMorgan Chase's proposed settlement because it seeks to use these WaMu tax refunds for the benefit of JPMorgan Chase either to settle WMI claims against JPMorgan Chase or to indemnify JPMorgan Chase against other claims," stated William Isaacson of Boies, Schiller & Flexner LLP, a counsel for bondholders. Isaacson added, "The senior bondholders commend the decision of the FDIC to decline the current proposed settlement and we plan to work constructively with the FDIC and the other parties to attempt to reach a resolution of the issues that will provide a fair and beneficial settlement for bondholders and the receivership estate." WaMu has been in receivership since September 25, 2008, the same day the FDIC sold existing assets of WaMu to JPMorgan Chase. Prior to the bank's demise, senior bondholders provided WaMu with essential financing and liquidity. JPMorgan Chase's acquisition of WaMu was structured as an asset purchase, so that JPMorgan Chase could avoid taking on WaMu's obligations to its creditors, which include the senior bonds. The FDIC and senior bondholders were recently asked to approve a proposed settlement described in general terms on March 12, 2010, in the WMI bankruptcy proceedings. The settlement, among other issues, seeks to resolve claims to the FDIC by JPMorgan Chase to two tax refunds that arose after the asset sale and that the senior bondholders maintain should be paid to WaMu receivership. Senior bondholders have objected to the proposed settlement in part because the proposed settlement would unfavorably resolve a claim by JPMorgan Chase that, as the asset purchaser, it should be paid by the WaMu receivership estate an estimated $2.6 billion tax refund from stimulus money created by the November 2009 Worker, Homeownership, and Business Assistance Act. JPMorgan Chase made this claim despite the fact that this same legislation bars TARP recipients such as JPMorgan Chase from receiving those tax refunds. Bondholders have also objected to JPMorgan Chase's claim to a $3 billion tax refund based on the post-asset sale tax losses generated by the FDIC's sale of WaMu's assets to JPMorgan Chase for $1.88 billion. Senior bondholders have contended to the FDIC that the proposed settlement described in the bankruptcy court would have improperly permitted JPMorgan Chase to use major portions of the tax refunds belonging to the WaMu receivership estate, including the stimulus tax refund, to settle WMI's claims against JPMorgan Chase. The proposal would have further allowed JPMorgan Chase to direct another $1.4 billion of the stimulus tax refund to the receivership estate to be used to indemnify JPMorgan Chase. Senior bondholders include, among others, Marathon Asset Management, the D. E. Shaw group, Solus Alternative Asset Management LP, Caspian Capital Advisors LLC, and over 20 others. 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. Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP served as legal counsel to WMI with responsibility for the litigation. Brian Rosen, Esq., at Weil, Gotshal & Manges LLP served as legal counsel to WMI with responsibility for the chapter 11 case. 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). YL WEST: Taps Marilyn Simon as Bankruptcy Counsel ------------------------------------------------- YL West 87th Street, LLC, has asked for authorization from the Hon. Arthur J. Gonzalez of the U.S. Bankruptcy Court for the Southern District of New York to employ Marilyn Simon & Associates as bankruptcy counsel, nunc pro tunc March 17, 2010. MS&A will, among other things: a. assist the Debtor in the preparation of a plan of reorganization in this case and to take necessary steps to bring the plan to confirmation; b. prepare applications, answers, orders, reports and other motions, complaints, pleadings and documents; c. appear before the Judge Gonzalez and the United States Trustee and protect the interests of the Debtor; and d. perform legal services for the Debtor that may be necessary and appropriate herein. Marilyn Simon -- msimon@msimonassoc.com -- a principal at MS&A, says that the firm will be paid based on the hourly rates of its personnel: Principals $450 Counsel $350 Paralegals $125 Clerks $50 Ms. Simon assures the Court that MS&A is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. New York-based YL West 87th Street, LLC, is owned by YL West 87th Holdings I. LLC. The Company filed for Chapter 11 bankruptcy protection on November 13, 2009 (Bankr. S.D.N.Y. Case No. 09- 16786). YL West 87th Holdings also filed for bankruptcy. Brian J. Hufnagel, Esq., and Gary M. Kushner, Esq., at Forchelli, Curto, Deegan, Schwartz, Mineo, Cohn & Terrana, LLP, assist YL West 87th Street in its restructuring effort. The Company listed $50,000,001 to $100,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. YRC WORLDWIDE: CEO Bill Zollars' Pay Down 44% in 2009 ----------------------------------------------------- YRC Worldwide Inc. disclosed in a regulatory filing that it paid William D. Zollars, its Chairman of the Board and Chief Executive Officer, $2,472,871 for fiscal 2009 -- down 44% from $4,388,140 paid in 2008. Mr. Zollars also received $5,195,096 in fiscal 2007. Mr. Zollars' 2009 compensation included $928,104 in base salary and $843,767 in stock awards. Mr. Zollars' 2008 compensation included $1,040,000 in base salary and $1,227,520 in stock awards. Mr. Zollars' employment is governed by a January 25, 2006 Agreement. It is a five-year term commencing January 1, 2006, and ending on December 31, 2010; with automatic extensions for additional one-year periods unless the Company or Mr. Zollars provides specified prior termination notice. Mr. Zollar's base salary is reviewed annually. Mr. Zollars had agreed to participate in the non-union wage reductions lower his 2009 base salary. Timothy A. Wicks, YRC President and Chief Operating Officer, was paid $879,874 in 2009, which included $396,695 in salary and $189,307 in stock awards. Mr. Wicks was paid $545,892 in 2008, including $87,949 in salary and $300,000 in stock awards. Mr. Wick's compensation also included a $181,305 reimbursement for loss on sale of his home and a tax gross-up on that amount of $89,858. Sheila K. Taylor, YRC Executive Vice President and Chief Financial Officer, received $210,353 in 2009, which included $193,193 in base salary and $2,637 in stock awards. Michael J. Smid, Chief Operations Officer and President of YRC Inc., was paid $1,020,890 in 2009. He got $1,769,048 in 2008 and $1,315,798 in 2007. Daniel J. Churay, YRC Executive Vice President, General Counsel and Secretary, received $514,575 in 2009. He got paid $721,891 in 2008 and $723,998 in 2007. Phil J. Gaines, YRC Senior Vice President of Finance and Chief Accounting Officer, received $477,464 in 2009. Overland Park, Kansas-based YRC Worldwide Inc., one of the largest transportation service providers in the world, is a holding company that through wholly owned operating subsidiaries offers a wide range of transportation services. These services include global, national and regional transportation as well as logistics. KPMG LLP, in Kansas City, Missouri, expressed substantial doubt about YRC Worldwide's ability to continue as a going concern in its report on the Company's consolidated financial statements as of and for the year ended December 31, 2009. The independent auditors noted that the Company has experienced significant declines in operations, cash flows, and liquidity. The Company's balance sheet as of Dec. 31, 2009, showed $3.032 billion in assets, $2.865 billion and of debts, and $167.2 million of stockholders' equity. * * * According to the Troubled Company Reporter on Feb. 26, 2010, Fitch Ratings has assigned a rating of 'C/RR6' to YRC Worldwide's new 6% senior unsecured convertible notes due 2014. The first tranche of new notes, totaling $49.8 million, was issued on Feb. 23, 2010. Proceeds from this tranche will be used to repay the $45 million in remaining outstanding principal on YRC Regional Transportation Inc.'s 8.5% senior secured notes (known as the USF notes). As reported by the TCR on January 14, 2010, Standard & Poor's Ratings Services raised its corporate credit rating on YRC Worldwide to 'CCC-' from 'SD' (selective default). At the same time, S&P raised the senior unsecured issue-level ratings to 'CC' from 'D' on the company's remaining notes that were subject to the exchange offer, as well as a '6' recovery rating, indicating negligible (0%-10%) recovery of principal in a payment default scenario. The company has issued a combination of common and preferred equity in exchange for the existing notes. ZALE CORP: Inks Amended Employment Security Deal with M. Appel --------------------------------------------------------------Zale Corporation entered into an amended and restated Employment Security Agreement with Matthew W. Appel. The amended and restated ESA provides for severance in the event of either a "Qualifying Termination" other than during a "Protection Period" as defined in the ESA or a termination due to disability or death in the amount of 12 months salary and average earned bonus. Prior to being amended, the ESA for Mr. Appel provided for six months salary and average earned bonus in either event. About Zale Corp. Dallas, Texas-based Zale Corporation (NYSE: ZLC) -- http://www.zalecorp.com/-- is a specialty retailer of diamonds and other jewelry products in North America, operating roughly 1,900 retail locations throughout the United States, Canada and Puerto Rico, as well as online. Zale Corporation's brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale also operates online at www.zales.com, www.zalesoutlet.com and www.gordonsjewelers.com As reported by the Troubled Company Reporter on February 10, 2010, The Deal.com's Sara Behunek reported that analysts said bankruptcy looms for Zale if it fails to restructure its debt and put in place a solid merchandising strategy. ZANETT INC: Regains Compliance With NASDAQ Listing Rule ------------------------------------------------------- Zanett, Inc., disclosed that on March 18, 2010, it received a letter from the Nasdaq Stock Market indicating that Zanett has regained compliance with the minimum bid price requirement for continued listing set forth in Nasdaq Listing Rule 5550(a)(2). According to the letter, the Staff determined that for the 10 consecutive business days from March 4 to March 17, the closing bid price of Zanett's common stock was $1.00 or greater. Based on prior correspondence with the Nasdaq Staff, Zanett had until September 13, 2010, to regain compliance with the rule, or the Staff would take action to delist Zanett's common stock from The Nasdaq Capital Market. Because Zanett is now in compliance with all of the applicable listing requirements, this matter with Nasdaq has been closed. About Zanett Zanett is a leading business process outsourcing (BPO), IT enabled services (ITES), and information technology (IT) consulting firm serving Fortune 500 corporations and mid-market organizations in Healthcare, Life Sciences, Manufacturing & Distribution, Retail, Gaming & Hospitality, and State & Local Government. * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Total Total Share- Total Working Holders' Assets Capital Equity Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------- -------- AUTOZONE INC AZO US 5,425.0 (100.6) (421.7) SOUTHGOBI ENERGY 1878 HK 560.7 388.8 (2.8) DUN & BRADSTREET DNB US 1,749.4 (99.5) (734.0) MEAD JOHNSON MJN US 2,070.3 235.9 (664.3) INTERMUNE INC ITMN US 114.7 59.5 (105.8) NAVISTAR INTL NAV US 9,126.0 1,277.0 (1,622.0) BOARDWALK REAL E BEI-U CN 2,378.3 - (45.0) TAUBMAN CENTERS TCO US 2,606.9 - (474.7) BOARDWALK REAL E BOWFF US 2,378.3 - (45.0) UNISYS CORP UIS US 2,956.9 308.6 (1,271.7) CHOICE HOTELS CHH US 340.0 (3.9) (114.2) MOODY'S CORP MCO US 2,003.3 (223.1) (596.1) WR GRACE & CO GRA US 3,968.2 1,134.0 (290.5) LINEAR TECH CORP LLTC US 1,512.8 673.5 (114.3) DEX ONE CORP DEXO US 4,498.8 (402.9) (6,919.0) WEIGHT WATCHERS WTW US 1,087.5 (336.1) (733.3) SUN COMMUNITIES SUI US 1,181.4 - (111.3) IPCS INC IPCS US 559.2 72.1 (33.0) CABLEVISION SYS CVC US 9,325.7 (14.9) (5,143.3) PETROALGAE INC PALG US 3.2 (6.6) (40.1) DISH NETWORK-A DISH US 8,295.3 188.7 (2,091.7) UAL CORP UAUA US 18,684.0 (1,368.0) (2,811.0) NATIONAL CINEMED NCMI US 628.2 92.8 (493.1) HEALTHSOUTH CORP HLS US 1,681.5 34.8 (510.2) REGAL ENTERTAI-A RGC US 2,637.7 32.4 (246.9) TEAM HEALTH HOLD TMH US 940.9 17.4 (92.3) SOUTHGOBI ENERGY SGQ CN 560.7 388.8 (2.8) CHENIERE ENERGY CQP US 1,859.5 37.3 (480.3) VECTOR GROUP LTD VGR US 735.5 240.2 (4.7) EPICEPT CORP EPCT SS 7.5 (6.5) (9.1) REVLON INC-A REV US 794.2 94.3 (1,033.6) JUST ENERGY INCO JE-U CN 1,387.1 (387.0) (356.5) INCYTE CORP INCY US 712.4 523.2 (102.4) FORD MOTOR CO F US 197,890.0 (8,112.0) (6,515.0) DOMINO'S PIZZA DPZ US 453.8 59.2 (1,321.0) OVERSTOCK.COM OSTK US 144.4 34.1 (3.1) ARVINMERITOR INC ARM US 2,499.0 98.0 (1,112.0) KNOLOGY INC KNOL US 646.9 26.2 (33.9) GRAHAM PACKAGING GRM US 2,126.3 167.2 (763.1) THERAVANCE THRX US 181.4 123.1 (189.0) LIBBEY INC LBY US 794.8 139.9 (66.9) VENOCO INC VQ US 739.5 (20.6) (174.5) WORLD COLOR PRES WC CN 2,641.5 479.2 (1,735.9) CARDTRONICS INC CATM US 460.4 (47.3) (1.3) JAZZ PHARMACEUTI JAZZ US 107.4 (22.3) (72.8) WORLD COLOR PRES WC/U CN 2,641.5 479.2 (1,735.9) WORLD COLOR PRES WCPSF US 2,641.5 479.2 (1,735.9) TALBOTS INC TLB US 839.7 (3.9) (190.6) PROTECTION ONE PONE US 571.9 (18.4) (59.1) AFC ENTERPRISES AFCE US 116.6 (2.7) (18.2) EXTENDICARE REAL EXE-U CN 1,668.1 122.8 (50.9) BLOUNT INTL BLT US 483.6 149.5 (6.7) AMER AXLE & MFG AXL US 1,986.8 71.1 (559.9) FORD MOTOR CO F BB 197,890.0 (8,112.0) (6,515.0) DEXCOM DXCM US 46.9 18.1 (18.4) AMR CORP AMR US 25,438.0 (1,086.0) (3,489.0) BLUEKNIGHT ENERG BKEP US 316.8 (4.3) (133.6) SALLY BEAUTY HOL SBH US 1,529.7 360.6 (580.2) CENVEO INC CVO US 1,525.8 162.5 (176.5) CENTENNIAL COMM CYCL US 1,480.9 (52.1) (925.9) UNITED RENTALS URI US 3,859.0 244.0 (19.0) ACCO BRANDS CORP ABD US 1,106.8 238.2 (117.2) SANDRIDGE ENERGY SD US 2,780.3 30.4 (195.9) US AIRWAYS GROUP LCC US 7,454.0 (458.0) (355.0) RURAL/METRO CORP RURL US 275.4 35.2 (105.3) COMMERCIAL VEHIC CVGI US 250.5 75.8 (37.8) LODGENET INTERAC LNET US 508.4 (4.9) (71.0) GREAT ATLA & PAC GAP US 3,025.4 248.7 (358.5) MANNKIND CORP MNKD US 247.4 8.8 (59.2) WARNER MUSIC GRO WMG US 3,934.0 (599.0) (97.0) PDL BIOPHARMA IN PDLI US 338.4 22.3 (416.0) EXELIXIS INC EXEL US 343.4 22.9 (163.7) EASTMAN KODAK EK US 7,691.0 1,407.0 (33.0) ZYMOGENETICS INC ZGEN US 319.3 110.1 (4.0) CALLON PETROLEUM CPE US 228.0 (39.9) (80.9) LIN TV CORP-CL A TVL US 790.5 20.4 (169.2) GENCORP INC GY US 1,018.7 114.6 (268.0) VIRNETX HOLDING VHC US 4.3 (0.1) (0.1) QWEST COMMUNICAT Q US 20,380.0 (483.0) (1,178.0) VIRGIN MOBILE-A VM US 307.4 (138.3) (244.2) SINCLAIR BROAD-A SBGI US 1,597.7 23.1 (202.2) HOVNANIAN ENT-A HOV US 2,100.2 1,222.4 (110.7) NPS PHARM INC NPSP US 159.6 71.3 (222.8) CYTORI THERAPEUT CYTX US 24.7 9.9 (3.7) WAVE SYSTEMS-A WAVX US 6.3 (2.0) (1.9) PALM INC PALM US 1,007.2 141.7 (6.2) PRIMEDIA INC PRM US 239.7 (3.3) (102.2) DENNY'S CORP DENN US 312.6 (33.8) (127.5) SEALY CORP ZZ US 1,015.5 157.2 (108.0) CC MEDIA-A CCMO US 18,047.1 2,114.7 (6,844.7) MONEYGRAM INTERN MGI US 5,929.7 (174.2) (18.7) MAGUIRE PROPERTI MPG US 3,667.7 - (857.0) CINCINNATI BELL CBB US 2,064.3 (2.8) (654.6) ARIAD PHARM ARIA US 65.0 8.2 (89.0) CONEXANT SYS CNXT US 273.7 65.8 (66.7) DYAX CORP DYAX US 64.8 34.1 (38.6) GLG PARTNERS-UTS GLG/U US 500.8 167.4 (283.6) GLG PARTNERS INC GLG US 500.8 167.4 (283.6) CHENIERE ENERGY LNG US 2,732.6 220.1 (432.1) ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, 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 2010. 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 ***