/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100521.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, May 21, 2010, Vol. 14, No. 139 Headlines AEROBICS INC: Blames Economic Downturn for Bankruptcy Filing AFFINITY GROUP: Posts $10,384,000 Net Loss for March 31 Qtr ALEN TALIBOV: Case Summary & 20 Largest Unsecured Creditors ALION SCIENCE: Posts $9,165,000 Net Income for March 31 Qtr ALLEGIANT TRAVEL: Moody's Assigns Ba3 Corporate, Stable Outlook ALLIS-CHALMERS: Net Loss Widens to $9.5-Mil. in Q1 2010 ALMATIS BV: Seeks Court Approval to Hire S&B as Auditors ALMATIS BV: Wants Linklaters as U.K. and Germany Counsel ALMATIS BV: Applies for De Brauw as Dutch Counsel ALMATIS BV: Proposes Schultze & Braun as German Counsel AMERICAN GENERAL CORP: Swings to $12.4MM Profit for Q1 of 2010 AMERICAN GENERAL FINANCE: Earns $7.6 Million in Q1 2010 AMERICAN INT'L: Board Appoints New Executives AMERICAN INT'L: Henri Courpron Joins ILFC as President and CEO AMERICAN INT'L: Judicial Watch Files Lawsuit to Obtain Documents AMR CORP: American Eagle President & CEO P. Bowler Retires APIERON INC: Aerocrine Buys Apieron's Business, IP Assets ARVINMERITOR INC: Files Quarterly Report on Form 10-Q with SEC ASARCO LLP: Settles Environmental Claims in Texas for $1.75M ATLANTIC MARINE: Moody's Keeps 'B2' Corporate After Sale to BAE AVISTAR COMMS: Files Form 10-Q for March 31 Quarter BARCALOUNGER CORP: Files for Chapter 11 to Sell Assets BBN MERCER: Case Summary & 7 Largest Unsecured Creditors BEVERAGE & MORE: S&P Changes 'B-' Corporate Outlook to Positive BORGER HOSPITALITY: Files for Chapter 11 Bankruptcy Protection BROWN PUBLISHING: Dolan Media Objects to Sale to Insiders CABLEVISION SYSTEMS: Posts $74.1MM Net Income for March 31 Qtr. CALIFORNIA: Calpers Seeks Extra $600-Mil. Despite Budget Deficit CALIFORNIA STEEL: S&P Affirms 'BB-' Corporate; Outlook Now Stable CANDALYN LAUFER: Case Summary & 8 Largest Unsecured Creditors CAROLINA PARK: Case Summary & 20 Largest Unsecured Creditors CATALYST PAPER: S&P Affirms 'CCC+' LT Corporate; Outlook Stable CELL THERAPEUTICS: Posts $26 Million Net Loss for First Quarter CENTAUR LLC: Wells Fargo Lashes Out at Disclosure Statement CINCINNATI BELL: Shareholders Elect Nominees for Directors CINCINNATI BELL: Posts $2.6-Mil. Net Income for March 31 Quarter CITGO PETROLEUM: Moody's Affirms Ba2 Corporate Family Rating CHEMTURA CORP: Proposed Diacetyl Claimants Panel Draws Objections CHEMTURA CORP: Modifies Incentive Plan to Address Issues CHEMTURA CORP: Court Sustains Committee Objection to CERT Claims CHEMTURA CORP: Reports $177 Million Net Loss for First Quarter CITADEL BROADCASTING: Judge Formally Approves Reorganization Plan CITADEL BROADCASTING: Proposes to Assume ACE Insurance Policies CITIGROUP INC: Parsons Cedes Director-Recruiting Role to Taylor CJ PRIME: Voluntary Chapter 11 Case Summary COEUR D'ALENE: Exchanges $14 Million Senior Notes for Stock COMFORCE CORP: Post $576,000 Net Income for March 28 Quarter COMMERCIAL BANK: Fitch Affirms IDR at 'B' with Negative Outlook COMMERCIAL VEHICLE: Posts $676,000 Profit for First Quarter COPPER KING: Suspends Mining Operations D&P MARKET PLACE: Voluntary Chapter 11 Case Summary DANIEL GONSIOR: Case Summary & 20 Largest Unsecured Creditors DAVID ROSEN: Case Summary & 20 Largest Unsecured Creditors DEEP MARINE: Oceaneering International Bids for DMT Sapphire DELTA MUTUAL: Board OKs 5-Year Employment Pacts with CEO and EVP DIAMANTE ROSE: Voluntary Chapter 11 Case Summary DUNE ENERGY: UBS AG Holds 21.78% of Common Stock DUNE ENERGY: Post $7.9 Million Net Loss for 1st Quarter 2010 EAGLE AUTO: Case Summary & 20 Largest Unsecured Creditors EINSTEIN NOAH: Posts $620 Million Net Income for March 30 Quarter EXTENDED STAY: Starwood Submits Competing Bid; Auction on May 27 FIDELITY NATIONAL: Fitch Puts 'BB+' IDR on Watch Negative FORTUNE INDUSTRIES: Julia Reed Steps Down From Board FORTUNE INDUSTRIES: Reports $176,000 Net Loss for March 31 Qtr GENTA INC: Senior VP & COO Lloyd Sanders Steps Down GREEN SCENE: Case Summary & 20 Largest Unsecured Creditors GREGORY MORRIS: Case Summary & 9 Largest Unsecured Creditors GREGORY PALMER: Voluntary Chapter 11 Case Summary HEALTH MANAGEMENT: Fitch Affirms Issuer Default Rating at 'B+' HEALTH NET: S&P Upgrades Counterparty Credit Rating to 'BB' HELLER EHRMAN: Plan Confirmation Hearing Set for July 6 IAP WORLWIDE: S&P Upgrades Junk Corprate Credit Rating to 'B-' IE ROLLERSPORTS: Case Summary & 20 Largest Unsecured Creditors INC 439: Case Summary & 21 Largest Unsecured Creditors INT'L LEASE FINANCE: Appoints Henri Courpron as President & CEO INTERNATIONAL COAL: Files Form 10-Q for March 31 Quarter JACKIE SAUNDERS: Voluntary Chapter 11 Case Summary JANICE & J.W.: Voluntary Chapter 11 Case Summary JOHN SNYDER: Voluntary Chapter 11 Case Summary LARS LANGLO: Case Summary & 11 Largest Unsecured Creditors LEHMAN BROTHERS: LBI Trustee Has Received $84.4MM for Work LEHMAN BROTHERS: Judicial Watch Files Lawsuit to Obtain Documents LEVEL 3 COMMS: Posts $238 Million Net Loss for March 31 Quarter LINEAR TECHNOLOGY: Posts $100MM Net Income for March 28 Quarter MAGIC BRANDS: Sets June 17 Auction for Fuddruckers & Koo Koo Roo MESA AIR: District Court Allows Delta to Scrap Contract MERITAGE HOMES: Fitch Affirms IDR at 'B+'; Outlook Stable MEYER LOGISTICS: Case Summary & 19 Largest Unsecured Creditors MGM MIRAGE: Posts $96.7 Million Net Loss for March 31 Qtr. MIDDLEBROOK PHARMA: Signs Deal to Sell to Victory for $17.1MM MILL CREEK: Case Summary & 6 Largest Unsecured Creditors MITEL NETWORKS: Moody's Upgrades Corporate to 'B3' After IPO MONEYGRAM INTERNATIONAL: Files Form 10-Q for March 31 Quarter MOVIE GALLERY: Sees Liquidating Plan Filed by June 21 MOVIE GALLERY: Rival Liquidator Says Break-Up Fee Not Needed NATIONAL CENTURY: Appeals Court Revives Amedisys' Claims NEFF CORP: Case Summary & 30 Largest Unsecured Creditors NEW ANTIOCH: Case Summary & 7 Largest Unsecured Creditors NEWLAND INTERNATIONAL: Fitch Maintains Negative Watch Status NEXCEN BRANDS: Reports $700,000 Net Loss for First Quarter 2010 NEXPAK CORP: Wins Confirmation of Liquidating Plan NIC BANK: Fitch Affirms Long-Term IDR at 'B-' with Stable Outlook OCWEN FINANCIAL: Fitch Affirms IDR at 'B+'; Outlook Stable ORLEANS HOMEBUILDERS: Cancels Sale Deal, Pursues Reorganization OXBOW CARBON: S&P Changes Outlook of 'BB-' Corporate to Positive PAETEC HOLDING: Posts $9.5-Mil. Net Loss for March 31 Quarter PAUL JARCHOW: Case Summary & 5 Largest Unsecured Creditors PAUL TRANSPORTATION: Files for Chapter 11 in Oklahoma City PRO BRANDS: Case Summary & 20 Largest Unsecured Creditors PETER LORD: Case Summary & 16 Largest Unsecured Creditors PRIME GROUP: Files Form 25 to Delist Series B Preferred Shares PRIME GROUP: Posts $100,000 Q1 Net Loss, Mulls Asset Sales PROTECTION ONE: Reports $4.8 Million Net Loss for March 31 Qtr PROTECTION ONE: Lawsuits Filed Against GTCR Transaction RICARDO ORTEGA: Case Summary & 15 Largest Unsecured Creditors RICHARD HOYLE: Case Summary & 18 Largest Unsecured Creditors RIVIERA HOLDINGS: May File for Chapter 11 Absent Refinancing ROBERT LOCKWOOD: Files for Chapter 11 Bankruptcy Protection ROBERT ROLLINS: Case Summary & 20 Largest Unsecured Creditors SAINT VINCENT: Sets Procedures for 6th Avenue Staff House Sale SEMGROUP LP: Oil & Gas Producers Sue Goldman, BP for Fraud SEVEN FALLS: Has 30 Days to Secure New Financing SECUREALERT INC: Extends Period for Purchase of Midwest's Interest SEQUENOM INC: Unveils $51.6 Million Private Placement SEQUENOM INC: Posts $16 Million Net Loss for First Quarter SHOREBANK CORP: Raises More Than $125MM to Avoid Takeover SINCLAIR BROADCAST: Swings to $10.9-Mil. Profit in Q1 2010 SMURFIT-STONE: Proposes to Enter Into Consulting Pact With Murphy SMURFIT-STONE: Michigan Governor Wants Details on Closed Plant SMURFIT-STONE: Files Form 10-Q for March 31 Quarter SPARETIME FAMILY: Voluntary Chapter 11 Case Summary SPCM SA: S&P Upgrades Rating on Long-Term Corp. Rating to 'BB-' SPHERIS INC: Has Buyer for $17.5 Million Subordinated Note STATION CASINOS: Plan Outline Hearing Scheduled for June 10 STATION CASINOS: Plan Exclusivity Extended Until June STATION CASINOS: Sale Motion Not Ripe for Adjudication, Says Panel STATION CASINOS: Employees Say Chapter 11 Plan Unconfirmable SUMMIT HOTEL: Fortress Deal to Forbear Expired on May 17 SUNWEST MANAGEMENT: Sale to Blackstone Group Approved TELETOUCH COMMS: Unit Inks Settlement with Hawk Electronics THOMAS ENTERPRISES: Unit Slapped With Multimillion Civil Lawsuit TLC VISION: Emerges from Chapter 11 as Private Company TOWING AND RECOVERY: Case Summary & 20 Largest Unsecured Creditors TRIBUNE CO: Rejecting Contract with Dun & Bradstreet TRIBUNE CO: Chadbourne & Parke Bills $1.5 Million for March Work TRIBUNE CO: Media Unit Makes Management Promotions UNIFI INC: Files Form 10-Q for Period March 28 Quarter UNIVERSAL HEALTH: Fitch Cuts IDR to 'BB'; Now Under Watch Negative VERTIS HOLDINGS: Extends Expiration Dates of Exchange Offers WARNER MUSIC: Posts $28 Million Net Loss for March 31 Quarter WASHINGTON MUTUAL: Disclosure Statement Hearing Moved to June 3 WASHINGTON MUTUAL: Equity Holders Unsatisfied With Plan Revisions WASHINGTON MUTUAL: Objects to AT&T's $8.96 Million Claim WASHINGTON MUTUAL: Equity Panel Proposes Susman as Counsel WASHINGTON MUTUAL: Willingham & Esopus Sue to Compel Annual Meet WASHINGTON MUTUAL: OTS "Scolded" at Senate Hearing WASHINGTON MUTUAL: Objects to Oregon's $29.3 Million Claim WESTAR ENERGY: Moody's Affirms Ba2 Preferred Stock Rating WILLBROS GROUP: Moody's Assigns B3 on Proposed Sr. Secured Notes WORLDSPACE INC: Samara Bids $5.5 Million for Satellites XERIUM TECHNOLOGIES: Wins Court OK for Baker as European Counsel XERIUM TECHNOLOGIES: Can Hire AlixPartners as Financial Advisors XERIUM TECHNOLOGIES: Elects New Members to Board of Directors XERIUM TECHNOLOGIES: Files Amended 2009 Annual Financial Report XM SATELLITE: Posts $10.6 Million Net Income for First Quarter YEARBOOK PHOTOGRAPHY: Case Summary & Creditors List * Three-Quarters of Distressed Exchanges May Default, Says Moody's * April Claim Trades Set New Record, SecondMarket Says * Attorney Amar Agrawal Joins Scott H. Marcus & Associates * BOOK REVIEW: The Executive Guide to Corporate Bankruptcy ******** AEROBICS INC: Blames Economic Downturn for Bankruptcy Filing ------------------------------------------------------------ According to The Orange County Register, Aerobics Inc. filed for bankruptcy under Chapter 11 due to the general economic downturn, the bankruptcy of the Company's largest customer which resulted in the write-off of $1.3 million in receivables, and the loss of one- third of the debtor's distribution. Aerobics Inc. makes exercise equipment. AFFINITY GROUP: Posts $10,384,000 Net Loss for March 31 Qtr ----------------------------------------------------------- Affinity Group Holding, Inc., reported a net loss of $10,384,000 for the three months ended March 31, 2010, from a net loss of $4,571,000 for the same period a year ago. Revenues were $108,434,000 for the first quarter of 2010 from $105,053,000 for the 2009 first quarter. At March 31, 2010, the Company had total assets of $212,247,000 against total liabilities of $529,772,000, resulting in stockholders' deficit of $317,525,000. A full-text copy of the Company's Form 10-Q is available at no charge at http://ResearchArchives.com/t/s?62b0 Ventura, Calif.-based Affinity Group Holding, Inc. is a holding company and the direct parent of Affinity Group, Inc. The Company is an indirect wholly-owned subsidiary of AGI Holding Corp, a privately-owned corporation. The Company is a member-based direct marketing organization targeting North American recreational vehicle owners and outdoor enthusiasts. In addition, the Company is a specialty retailer of RV-related products. The Company operates through three principal lines of business, consisting of (i) club memberships and related products and services, (ii) subscription magazines and other publications including directories, and (iii) specialty merchandise sold primarily through the Company's 78 Camping World retail stores, mail order catalogs and the Internet. * * * Affinity Group Holding Inc. continues to carry S&P's (CCC/Negative/--) Corporate Credit Rating and Moody's Caa2 corporate family rating. ALEN TALIBOV: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Joint Debtors: Alen Talibov Ludmila Talibov fka Ludmila Shclover 87 Lake Road Terrace Wayland, MA 01778 Bankruptcy Case No.: 10-15373 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Henry J. Boroff Debtor's Counsel: Vladimir von Timroth, Esq. Law Office of Vladimir von Timroth 679 Pleasant Street Paxton, MA 01612 Tel: (508) 753-2006 Fax: (508) 753-2002 E-mail: vontimroth@gmail.com Scheduled Assets: $1,791,239 Scheduled Debts: $1,883,800 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mab10-15373.pdf The petition was signed by Alen Talibov and Ludmila Talibov. ALION SCIENCE: Posts $9,165,000 Net Income for March 31 Qtr ----------------------------------------------------------- Alion Science and Technology Corporation said net income was $9,165,000 for the three months ended March 31, 2010, from net income of $39,000 for the same period in 2009. Net income was $1,224,000 for the six months ended March 31, 2010, from a net loss of $2,501,000 for the same six months period in 2009. The Company said contract revenue was $203,546,000 for the three months ended March 31, 2010, from $195,429,000 for the same period in 2009. Contract revenue was $409,284,000 for the six months ended March 31, 2010, from $384,225,000 for the same period in 2009. At March 31, 2010, the Company had total assets of $667,161,000 against total current liabilities of $171,138,000, senior secured notes of $268,400,000, senior unsecured notes of $245,684,000, accrued compensation, excluding current portion of $5,275,000, accrued postretirement benefit obligations of $740,000, non- current portion of lease obligations of $7,921,000, and deferred income taxes of $33,818. A full-text copy of the Company's Form 10-Q is available at no charge at http://ResearchArchives.com/t/s?62ad Alion hosted a conference call on May 20, 2010 at 1:30 p.m. ET/10:30 a.m. PT to discuss financial results for the second quarter of Alion's fiscal year 2010. Participants may join the conference call by dialing 1-866-244-4530 (toll-free) 10 minutes prior to the start of the conference. About Alion Science Alion Science and Technology Corporation, based in McLean, VA, is an employee-owned company that provides scientific research, development, and engineering services related to national defense, homeland security, and energy and environmental analysis. Particular areas of expertise include communications, wireless technology, netcentric warfare, modeling and simulation, chemical and biological warfare, program management. * * * Alion carries 'Caa3' corporate family and probability of default ratings from Moody's. Alion carries a 'B-' corporate credit rating from Standard & Poor's. ALLEGIANT TRAVEL: Moody's Assigns Ba3 Corporate, Stable Outlook --------------------------------------------------------------- Moody's Investors Service assigned debt ratings to Allegiant Travel Company: Corporate Family and Probability of Default ratings of Ba3 and a Speculative Grade Liquidity rating of SGL-2. The outlook is stable. These are first time ratings of Allegiant. Moody's also assigned a Ba3 rating to the planned issuance of $250 million of senior unsecured notes due 2017 that Allegiant announced on May 18, 2010,. Moody's expects Allegiant to apply the Note proceeds to payments for the balance of the purchase price and induction costs for the MD 80 and Boeing 757 aircraft under contract and to repayment of some or all of the about $37 million of aircraft mortgage debt outstanding at March 31, 2010, with the balance being held for general corporate purposes. The Notes will be privately-placed and have registration rights. "The Ba3 corporate family rating considers Allegiant's differentiated business model that leads to lower unit costs and higher operating margins relative to those of other rated airlines, supports strong market share on its routes that focus on small origination cities and drives down the need for capital," said Moody's airline analyst, Jonathan Root. Moody's expects Allegiant to sustain the profitability of its business model as it continues to grow, notwithstanding the execution risk in its plan to deploy a new aircraft type (B757-200ER) to serve the Hawaii market and some concentration because of its emphasis on the Las Vegas destination. The low capital intensity of the MD-80 family of aircraft, the significant labor cost advantage of the entirely non-union operation, and service between secondary origination cities and certain leisure destinations with limited direct competition provide the foundation for Allegiant's airline operations to achieve relatively strong profit margins and sustain positive free cash flow generation. The Ba3 rating also reflects good liquidity and credit metrics that are strong for the rating category. Allegiant has greater operating flexibility relative to many large airlines because of the low acquisition cost of its MD- 80 aircraft and that relatively few are debt-financed. Consequently, unlike its highly-levered airline peers, it does not need to maximize utilization of its fleet in order to generate cash flow to meet debt service obligations. The ratings also anticipate no changes to Allegiant's proprietary distribution model, which offers hotel and other travel services packages with its airfares to broaden its appeal to potential customers. The demonstrated financial results of 2008 and 2009, good liquidity and the expectation that Allegiant will not change its strategy -- by seeking to directly compete against the mainline route networks of U.S. legacy or low-cost carriers, and/or by further diversification of its current fleet of MD80's -- sufficiently mitigate the downwards pull of the factors that typically strain an airline's credit profile including high capital intensity, fuel price volatility, intense price competition, low barriers to entry and economic cycles. "The company's historical financial results, industry leading unit costs (ex-fuel) and credit metrics that are generally stronger than the Ba rating category provide sufficient cushion for maintaining the Ba credit profile should actual results trail Moody's expectations," said Mr. Root. These factors also help mitigate ratings pressure of Allegiant's relatively small size, limited operating history and lower yields that are a function of its price-driven business model. The SGL-2 rating reflects good liquidity, characterized by a large cash balance relative to revenues and sustained free cash flow generation, tempered by a lack of external liquidity and limited financeable assets. Unrestricted cash exceeds debt and Moody's anticipates that it will continue to do so, even after the closing of the Notes offering. Moody's expects that Allegiant's current cash commitments will be covered by operating cash flows and cash on hand. The outlook could be changed to positive if Allegiant was to sustain its current credit profile while executing its current growth plan: expand its network footprint into new North American cities and deploying the new fleet type for the Hawaii service. Sustaining Funds from operations + Interest to Interest above 7.0 times and Debt to EBITDA below 2.0 times for an extended period could lead to a change of the outlook to positive. The outlook could be changed to negative or the ratings downgraded if the execution of its growth plan, particularly Hawaii service, leads to meaningfully weaker credit metrics, such as Funds from operations + Interest to Interest of below 4.5 times or Debt to EBITDA of above 3.0 times. Sustained higher fuel prices that cause Allegiant, which does not currently utilize financial derivatives to hedge exposure to the cost of fuel, to significantly reduce its capacity could also pressure the ratings as could a change in financial policy that results in larger returns to shareholders in exchange for higher leverage. Assignments: Issuer: Allegiant Travel Company - Probability of Default Rating, Assigned Ba3 - Speculative Grade Liquidity Rating, Assigned SGL-2 - Corporate Family Rating, Assigned Ba3 - Senior Unsecured Regular Bond/Debenture, Assigned 55 - LGD4 to Ba3 Allegiant Travel Company, headquartered in Las Vegas, Nevada, operates a low-cost passenger airline marketed to leisure travelers in small cities, selling air travel both on a stand- alone basis and bundled with hotel rooms, rental cars and other travel related services. ALLIS-CHALMERS: Net Loss Widens to $9.5-Mil. in Q1 2010 ------------------------------------------------------- Allis-Chalmers Energy Inc. filed its quarterly report Form 10-Q, showing a net loss of $9.5 million on $140.3 million of revenues for the three months ended March 31, 2010, compared with a net loss of $2.6 million on $145.1 million of revenues during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $1.067 billion in total assets and $592.6 million in total liabilities, for a total stockholders' equity of $474.8 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62c5 About Allis-Chalmers Energy Houston, Texas-based Allis-Chalmers Energy Inc. (NYSE: ALY) -- http://www.alchenergy.com/-- is a multi-faceted oilfield services company. Allis-Chalmers provides services and equipment to oil and natural gas exploration and production companies, domestically primarily in Texas, Louisiana, New Mexico, Oklahoma, Arkansas, offshore in the Gulf of Mexico, and internationally, primarily in Argentina, Brazil and Mexico. Allis-Chalmers provides directional drilling services, casing and tubing services, underbalanced drilling, production and workover services with coiled tubing units, rental of drill pipe and blow-out prevention equipment, and international drilling and workover services. * * * Allis-Chalmers carries 'B-' issuer credit ratings, with stable outlook, from Standard & Poor's. It has 'B3' corporate family and probability of default ratings, with stable outlook, from Moody's. Its senior unsecured debt has 'Caa1' senior unsecured debt rating from Moody's. ALMATIS BV: Seeks Court Approval to Hire S&B as Auditors -------------------------------------------------------- Almatis B.V. and its affiliated debtors seek approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Schultze & Braun GmbH Rechtanwaltsgesellschaft Wirtschaftspr fungsgesellschaft as their auditor effective as of April 30, 2010. The Debtors want to tap the firm to verify the feasibility of the contemplated restructuring according to any plan of reorganization from the individual perspective of the Debtors incorporated in Germany, particularly with respect to their going concern in the future, according to Almatis Chief Executive Remco de Jong. Schultze & Braun GmbH will also provide other auditing services upon agreement with the Debtors, Mr. de Jong says. In return for its services, the firm will be paid on an hourly basis and will be reimbursed for it necessary expenses. A list of Schultze & Braun GmbH's professionals who are expected to provide the services and their hourly rates is available at: http://bankrupt.com/misc/Almatis_SchultzeGmbH.pdf Jens Weber, a partner at Schultze & Braun GmbH, assures the Court that his firm does not have interest adverse to the interest of the Debtors' estates, creditors or equity security holders, and is a "disinterested person" as the term is defined under Section 101(14) of the Bankruptcy Code. About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Alamtis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ALMATIS BV: Wants Linklaters as U.K. and Germany Counsel -------------------------------------------------------- Almatis B.V. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to allow them to employ Linklaters LLP as their special corporate counsel effective as of April 30, 2010. The Debtors selected Linklaters because of its extensive expertise in corporate matters and because of its prior representation of the Debtors, Almatis Chief Executive Remco de Jong says. Prior to their bankruptcy filing, the Debtors were assisted by the firm in connection with their proposed financial restructuring as well as in the negotiation of possible out-of-court restructuring alternatives. As special corporate counsel to the Debtors, Linklaters will: (1) advise the Debtors and assist their general bankruptcy counsel in connection with their prepetition credit, security and intercreditor agreements, exit financing, security and capital structure, among other things; (2) advise the Debtors and assist their bankruptcy counsel in formulating and drafting disclosure statement for their restructuring plan; (3) advise the Debtors and assist their bankruptcy counsel with respect to cross-border issues implicating laws of foreign jurisdictions particularly the laws of the United Kingdom and Germany; and (4) attend meetings, participate in negotiations and appear before the U.S. Bankruptcy Court or any other courts. The Debtors will pay Linklaters for its services on an hourly basis and will reimburse the firm for its necessary expenses. The Linklaters professionals expected to provide the contemplated services to the Debtors and their hourly rates are: Professionals Resident Office Hourly Rates ------------- --------------- ------------ Robert Elliott London GBP625 Bruce Bell London GBP625 Michal Hlasek London/Frankfurt GBP625 Kolja von Bismarck Frankfurt GBP625 Paul Kuipers Amsterdam GBP625 Verena Etzel Frankfurt GBP460 Jacqueline Ingram London GBP280 Birgit Weckler Frankfurt GBP280 Mr. Elliot, Esq., a partner at Linklaters, assures the Court that his firm does not hold or represent interest adverse to the Debtors and their estates. About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Alamtis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ALMATIS BV: Applies for De Brauw as Dutch Counsel ------------------------------------------------- Almatis B.V. and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the Southern District of New York to employ De Brauw Blackstone Westbroek N.V. as their special Dutch counsel effective April 30, 2010. As special counsel, De Brauw Blackstone will advise the Debtors and assist their general bankruptcy counsel on matters including Dutch corporate law and cross-border issues implicating laws of foreign jurisdictions. The firm will also be required to attend meetings and participate in negotiations, or appear before the U.S. Bankruptcy Court or any other court. In return for its services, De Brauw Blackstone will be paid on an hourly basis and will be reimbursed for it necessary expenses. The firm's professionals who are expected to provide the services and their hourly rates are: Professionals Hourly Rates ------------- ------------ Ruud Hermans EUR675 Harm-Jan de Kluiver EUR675 Rene Clumpkens EUR675 Klaas de Vries EUR450 Gwenaelle Pennec EUR450 Rob van den Sigtenhorst EUR375 Pursuant to an agreement between the Debtors and De Brauw Blackstone, the firm's hourly fees will be discounted by 18%. If however the Debtors' restructuring is successful, the firm will be entitled to full payment of its earned fees. Rudolf Martinus Hermans, Esq., a shareholder of De Brauw Blackstone, assures the Court that his firm does not hold or represent interest that is adverse to that of the Debtors' estates. About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Alamtis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ALMATIS BV: Proposes Schultze & Braun as German Counsel ------------------------------------------------------- Almatis B.V. and its units seek the U.S. Bankruptcy Court's authority to employ Schultze & Braun GmbH echtsanwaltsgesellschaft as special German counsel to their management effective as of April 30, 2010. Schultze & Braun, as special counsel, will advise the Debtors' management on issues involving German law particularly in respect of the continuation prognosis depending on the development of the Debtors' Chapter 11 cases. The firm will also advise the management and assist the Debtors' general bankruptcy counsel on cross-border issues implicating laws of foreign jurisdictions. Schultze & Braun will also be required to attend meetings, participate in negotiations, and appear before the U.S. Bankruptcy Court or any other court. Schultze & Braun will be paid on an hourly basis and will be reimbursed for it expenses. A list of the firm's professionals who are expected to provide the services and their hourly rates is available at http://bankrupt.com/misc/Almatis_Schultze.pdf Christopher Alexander von Wilcken, Esq., at Schultze & Braun, assures the Court that the firm does not hold or represent interest adverse to the Debtors and their estates. About Almatis Group Alamtis B.V., and its affiliates filed for Chapter 11 on April 30, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-12308). Almatis B.V. estimated assets of US$500 million to US$1 billion and debts of more than US$1 billion as of the bankruptcy filing. Almatis, operationally headquartered in Frankfurt, Germany, is a global leader in the development, manufacture and supply of premium specialty alumina products. With nearly 900 employees worldwide, the company's products are used in a wide variety of industries, including steel production, cement production, non- ferrous metal production, plastics, paper, ceramics, carpet manufacturing and electronic industries. Almatis operates nine production facilities worldwide and serves customers around the world. Until 2004, the business was known as the chemical business of Alcoa. Almatis is now owned by Dubai International Capital LLC, the international investment arm of Dubai Holding. Michael A. Rosenthal, Esq., at Gibson, Dunn & Crutcher LLP, serves as counsel to the Debtors in the Chapter 11 cases. Linklaters LLP is the special English and German counsel and De Brauw Blackstone Westbroek N.V. is Dutch counsel. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Almatis Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Alamtis B.V., and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) AMERICAN GENERAL CORP: Swings to $12.4MM Profit for Q1 of 2010 -------------------------------------------------------------- American General Finance Corporation filed its quarterly report on Form 10-Q, showing net income of $12.4 million on $599.0 million of revenue for the three months ended March 31, 2010, compared with a net loss of $240.6 million on $585.2 million of revenue for the same period of 2009. Net income for the three months ended March 31, 2010, compared to the net loss for the three months ended March 31, 2009, reflected lower provision for finance receivable losses, higher other revenues resulting from foreign exchange gains on foreign currency denominated debt and derivatives adjustments, and benefit from income taxes, partially offset by lower finance charges primarily resulting from the 2009 sales of real estate loan portfolios as part of the Company's liquidity management efforts. The Company's balance sheet as of March 31, 2010, showed $20.2 billion in assets, $17.8 billion of liabilities, and $2.4 billion of stockholders' equity. As reported in the Troubled Company Reporter on March 8, 2010, PricewaterhouseCoopers LLP, in Chicago, Illinois, said that the Company is dependent upon the continued financial support of its ultimate parent company, American International Group, Inc., to meet its financial obligations as they become due and to support its ongoing operations. Due to a combination of the challenges facing AIG, its dependency on AIG, its liquidity concerns, its results of operations, downgrades of its credit ratings by the rating agencies, and the turmoil in the capital markets, the Company currently has no access to the unsecured debt market. In its Form 10-Q for the current quarter, AGFC says it believes that it will have adequate liquidity to finance and operate its businesses and repay its obligations as they become due for at least the next twelve months. "It is possible that the actual outcome of one or more of our plans could be materially different than expected or that one or more of our significant judgments or estimates about the potential effects of these risks and uncertainties could prove to be materially incorrect. If one or more of these possible outcomes is realized and third party financing is not available, we may need additional support to meet our obligations as they become due. Under these adverse assumptions, without additional support in the future, there could exist substantial doubt about our ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?62bd Evansville, Ind.-based American General Finance Corporation is a financial services holding company with subsidiaries engaged in the consumer finance and credit insurance businesses. At December 31, 2009, the Company had 1,178 branch offices in 39 states, Puerto Rico and the U.S. Virgin Islands; foreign operations in the United Kingdom; and approximately 6,500 employees. AGFC is a wholly owned subsidiary of American General Finance, Inc. Effective June 29, 2007, AGFI became a direct wholly owned subsidiary of AIG Capital Corporation, a direct wholly owned subsidiary of American International Group, Inc. AMERICAN GENERAL FINANCE: Earns $7.6 Million in Q1 2010 ------------------------------------------------------- American General Finance, Inc., filed its quarterly report on Form 10-Q, showing net income of $7.6 million on $601.7 million of revenue for the three months ended March 31, 2010, compared with a net loss of $248.1 million on $597.6 million of revenue for the same period of 2009. Net income for the three months ended March 31, 2010, compared to the net loss for the three months ended March 31, 2009, reflected lower provision for finance receivable losses, higher other revenues resulting from foreign exchange gains on foreign currency denominated debt and derivatives adjustments, and benefit from income taxes, partially offset by lower finance charges primarily resulting from the 2009 sales of real estate loan portfolios as part of the Company's liquidity management efforts. The Company's balance sheet as of March 31, 2010, showed $19.9 billion in assets, $18.0 billion of debts, and $1.9 billion of stockholders' equity. As reported in the Troubled Company Reporter on March 9, 2010, PricewaterhouseCoopers LLP, in Chicago, Illinois, said that the Company is dependent upon the continued financial support of its ultimate parent company, American International Group, Inc., to meet its financial obligations as they become due and to support its ongoing operations. Due to a combination of the challenges facing AIG, its dependency on AIG, its liquidity concerns, its results of operations, downgrades of its credit ratings by the rating agencies, and the turmoil in the capital markets, the Company currently has no access to the unsecured debt market. In its Form 10-Q for the current quarter, AGFI says that based on its estimates and taking into account the risks and uncertainties of its plans, it believes that it will have adequate liquidity to finance and operate its businesses and repay its obligations as they become due for at least the next twelve months. "It is possible that the actual outcome of one or more of our plans could be materially different than expected or that one or more of our significant judgments or estimates about the potential effects of these risks and uncertainties could prove to be materially incorrect. If one or more of these possible outcomes is realized and third party financing is not available, we may need additional support to meet our obligations as they become due. Under these adverse assumptions, without additional support in the future, there could exist substantial doubt about our ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?62be Evansville, Ind.-based American General Finance, Inc. was incoporated in Indiana is 1974 to become the parent holding company of American General Finance Corporation. AFGC is a financial services holding company with subsidiaries engaged in the consumer finance and credit insurance businesses. Effective June 29, 2007, AGFI became a direct wholly owned subsidiary of AIG Capital Corporation, a direct wholly owned subsidiary of American International Group, Inc. AMERICAN INT'L: Board Appoints New Executives --------------------------------------------- American International Group, Inc., on May 14 said the AIG Board of Directors has elected: -- William N. Dooley, as AIG Executive Vice President, Financial Services; -- Mark Herr, as AIG Vice President, Corporate Media Relations; and -- Tal Kaissar, as AIG Vice President and Director of Taxes. Mr. Dooley is responsible for the AIG Financial Services business, which includes International Lease Finance Corporation, American General Finance, Inc., and AIG Consumer Finance Group, Inc. Mr. Dooley reports to AIG President and Chief Executive Officer Robert N. Benmosche and was most recently AIG Senior Vice President, Financial Services. Since joining AIG in 1978, he has served in various senior roles in AIG's financial management and investment areas, including Vice President and Treasurer of AIG, Senior Vice President and Chief Investment Officer of American International Underwriters, and Senior Vice President and Treasurer of AIG Investment Corporation. He was elected AIG Vice President in 1996 and AIG Senior Vice President in 1998. Before joining AIG, Mr. Dooley was employed by European American Bank, New York. He received a B.S. in Business Administration from Manhattan College and an M.B.A. in Finance from Pace University. Mark Herr will oversee all aspects of AIG's corporate media relations, including developing and implementing AIG's media relations strategy, counseling senior management on media affairs, and coordinating media activities with AIG's communications professionals around the world. Mr. Herr joined the AIG media relations team in early 2009, initially focusing on divestitures and other activities related to AIG's restructuring. Later, his media relations responsibilities were expanded to include legal, regulatory and public policy issues. Mr. Herr reports to Christina Pretto, AIG Senior Vice President, Corporate Communications. Mr. Herr joined AIG from Merrill Lynch, where he served as chief media spokesperson and strategist for legal, regulatory and public policy issues. Prior to joining Merrill Lynch, Mr. Herr served as the Director and Assistant Attorney General in charge of New Jersey's Division of Consumer Affairs and Bureau of Securities. Earlier in his career, Mr. Herr was in private practice as a litigator, served as a speechwriter for New Jersey Governor Tom Kean, and worked as a reporter for United Press International, the Atlanta Journal, and the Bergen Record. Mr. Herr earned a bachelor's degree from Colgate University, a master's degree from Columbia University, and his law degree from Seton Hall University's School of Law. As AIG Vice President and Director of Taxes, Mr. Kaissar has accounting, reporting, and transactional responsibilities for all aspects of AIG taxation worldwide. He reports to David L. Herzog, AIG Executive Vice President and Chief Financial Officer. Mr. Kaissar joined AIG's Corporate Tax group in 2007 as Director, Tax Operations. He had previously served as Co-Head of Global Tax Accounting for Citigroup, which he joined after serving in progressively responsible tax roles in Ernst & Young's Financial Services practice, including tax Senior Manager. Mr. Kaissar earned his B.S. from Rutgers University and is a Certified Public Accountant. About AIG Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. AMERICAN INT'L: Henri Courpron Joins ILFC as President and CEO -------------------------------------------------------------- American International Group, Inc., and International Lease Finance Corporation said aviation industry veteran Henri Courpron has joined ILFC as President and Chief Executive Officer. Mr. Courpron, 47, succeeds ILFC Vice Chairman Alan Lund, who has served as interim ILFC President and CEO since March. Mr. Courpron will be based in ILFC's Los Angeles headquarters. "Henri Courpron, one of the aviation industry's most experienced leaders, is joining the ILFC team at a very exciting time," said Robert H. Benmosche, AIG President and CEO. "ILFC, the leading franchise in the aircraft leasing arena, is clearly positioned for the future, and we are greatly looking forward to Henri's leadership as we continue to extend ILFC's position as the industry's pre-eminent competitor. "ILFC has established real momentum over the last several months," Mr. Benmosche said. "Having stabilized the company's financial position, ILFC is now ready to begin growing its fleet. We have reiterated our commitment and the depth of our resources available to our customers across the industry, and the financial markets have demonstrated their confidence in the ILFC team and franchise. As is well-known, ILFC has raised more than $8 billion in liquidity from new debt, bank debt maturity extensions, and aircraft sales. "I'd like to personally thank Alan Lund for his leadership and dedication," Mr. Benmosche said. "Much of the credit for the dramatic improvement in ILFC's financial position belongs with Alan, and we are delighted that he has agreed to remain during the transition. Alan is a true partner." "Henri is well-known in the aviation industry for his customer focus, and ILFC and its customers will benefit from that as we remain committed to ILFC's position as a strong, enduring franchise," said Douglas M. Steenland, chairman of ILFC's Board and a member of the AIG Board of Directors. Henri Courpron began his aviation career in 1987 with Aerospatiale + Airbus-France, where he held management positions in procurement and sales before moving to Airbus-North America to serve from 1992 to 2005 in various executive positions, including President and CEO of Airbus North America Holdings. He returned to France where he served until 2007 as Airbus Executive Vice President -- Procurement. He joins ILFC from the Seabury Group, an advisory and investment banking firm in aviation and aerospace based in New York and Toulouse, France, where he was President. ILFC is the international market leader in the leasing and remarketing of advanced technology commercial jet aircraft to airlines around the world. ILFC owns a portfolio consisting of approximately 1,000 jet aircraft. * * * The Wall Street Journal's Daniel Michaels and Serena Ng report that Mr. Courpron said he was approached for the ILFC top job by Douglas Steenland, an AIG director and former CEO of Northwest Airlines who became ILFC's nonexecutive chairman in late 2009. The report notes the two have known each other since Mr. Courpron was an Airbus sales executive in the U.S. handling Northwest Airlines, a major Airbus client. Mr. Courpron's selection as ILFC's next leader "was a consensus decision" reached by Mr. Steenland, interim CEO Alan Lund and Mr. Benmosche, according to a person familiar with the matter, the Journal relates. The source told the Journal, Mr. Courpron impressed them with his "unparalleled" sales and marketing skills, and "his contacts in the industry are wide and deep." The source added that the new CEO should "be able to effectively place [leases for] airplanes and keep them placed." About AIG Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. AMERICAN INT'L: Judicial Watch Files Lawsuit to Obtain Documents ---------------------------------------------------------------- Judicial Watch, the public interest group that investigates and prosecutes government corruption, filed a Freedom of Information Act (FOIA) lawsuit on May 11 against the Board of Governors of the Federal Reserve System for documents related to the bailout of American International Group (AIG) and the bankruptcy of Lehman Brothers. The lawsuit was filed on behalf of former Federal Reserve employee Vern McKinley. The lawsuit is part of Judicial Watch's comprehensive investigation to determine under what legal authorities and lawful rationales the federal government initiated the Wall Street bailouts. With his March 21, 2010, FOIA request targeting information related to the AIG bailout, McKinley requested: "... any and all communications and records concerning or relating to the Board [of Governors'] decision that detail that 'the disorderly failure of AIG was likely to have a systemic effect on financial markets that were already experiencing a significant level of fragility,' as described in the [Board] meeting minutes." With his March 28, 2010, FOIA request targeting information related to Lehman Brothers, McKinley requested: "... any and all communications and records regarding analysis undertaken regarding Lehman Brothers and the assessment in September 2008 or earlier of what 'contagion' might have flowed from Lehman Brother's filing of bankruptcy, as the word contagion was used in the case of the Board of Governors' deliberations over Bear Stearns... or 'systemic effect of financial markets' that may have flowed from a Lehman Bankruptcy as the phrase was used in the Board of Governors' deliberations over American International Group... " The Board of Governors acknowledged receipt of both FOIA requests but failed to respond within the statutory allotted time period, prompting McKinley's lawsuit. "We are now trillions of taxpayer dollars into these financial bailouts and a fundamental question remains unanswered: Under what authority did the federal government take such a radically intrusive approach to the financial crisis? How were the bailout winners and losers chosen? The Federal Reserve and the Obama administration owe the American people an explanation," said Judicial Watch President Tom Fitton. Judicial Watch currently has two additional FOIA lawsuits ongoing on behalf of Mr. McKinley related to the bailouts of Bear Stearns, Bank of America and Citigroup. Visit www.JudicialWatch.org to access documents related to these lawsuits. About AIG Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) AMR CORP: American Eagle President & CEO P. Bowler Retires ---------------------------------------------------------- AMR Corp., parent company of American Airlines and American Eagle, disclosed that American Eagle President and CEO Peter Bowler has chosen to retire, after a distinguished 26-year career with American and American Eagle. "It has been the highlight of my airline career to be the President and CEO of American Eagle," said Bowler. "I am grateful for the opportunity to have served with the wonderful people of American Eagle and am proud of the fact that we have successfully navigated more than 11 years of constant change." Bowler added, "We responded quickly to the dramatic events of our times - from 9/11 to wars in Afghanistan and Iraq; from epidemics to oil spikes and the global financial crisis. Unlike many competitors, American Eagle avoided bankruptcy or labor strife, established an excellent safety culture and safety record and revitalized our fleet and facilities." "For more than a decade, Peter has led the American Eagle team through one of the most challenging periods in our industry. He has also been a key member of American's Executive Committee during this period," said AMR Chairman and CEO Gerard Arpey. Arpey added, "With a comprehensive understanding of the airline business and a deep concern for Eagle's people, he has overseen the transition of American Eagle to one of the largest regional jet operators in the world, offering over 1,600 flights a day to destinations throughout the U.S., Canada, the Caribbean and Mexico. I offer my sincere thanks for his leadership and many contributions to American and American Eagle." Bowler joined American in 1984 and held a variety of staff and line positions in the Sales, Marketing, Human Resources, and Information Technology departments at American before moving to American Eagle in 1998. He will stay on in his current role until a successor is named. About AMR Corporation Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, including Brazil, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. * * * AMR carries a 'CCC' issuer default rating from Fitch Ratings. It has 'Caa1' corporate family and probability of default ratings from Moody's. It has 'B-' corporate credit rating, on watch negative, from Standard & Poor's. APIERON INC: Aerocrine Buys Apieron's Business, IP Assets --------------------------------------------------------- Bankruptcy Law360 reports that Aerocrine AB has bought the business and intellectual property assets of Apieron Inc., bringing partial resolution to a long-running patent dispute between the companies over lung inflammation monitors. Aerocrine won the assets in a Chapter 7 bankruptcy auction in the U.S. Bankruptcy Court for the Northern District of California on May 12, Law360 says. ARVINMERITOR INC: Files Quarterly Report on Form 10-Q with SEC -------------------------------------------------------------- ArvinMeritor Inc. filed with Securities and Exchange Commission on its quarterly report Form 10-Q for the period ended March 31, 2010. As also disclosed in an earnings released by the Company last week, the Company reported net income of $17.0 million on $1.2 billion of revenue for quarter ended March 31, 2010, compared with a net loss of $49.0 million on $962.0 million of revenue during the same period a year ago. The Company attributes the increase in sale to strengthening in most original equipment markets globally. The Company's balance sheet at March 31, 2010, showed $2.769 billion in total assets and $3.646 billion in total liabilities, for a $877.0 million stockholders' deficit. Stockholder's deficit was at $1.166 billion at March 31, 2009. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a9 About ArvinMeritor Inc. Based in Troy, Michigan, ArvinMeritor, Inc. (NYSE: ARM) -- http://www.arvinmeritor.com/-- is a premier global supplier of a broad range of integrated systems, modules and components to the motor vehicle industry. The Company marks its centennial anniversary in 2009, celebrating a long history of 'forward thinking.' The company serves commercial truck, trailer and specialty original equipment manufacturers and certain aftermarkets, and light vehicle manufacturers. ArvinMeritor reported $2.5 billion in total assets against $3.61 billion in total liabilities, resulting to a stockholders' deficit of $1.11 billion as of December 31, 2009. * * * In January 2010, Moody's Investors Service affirmed the Corporate Family and Probability of Default ratings of ArvinMeritor, Inc., at 'Caa1'. ASARCO LLP: Settles Environmental Claims in Texas for $1.75M ------------------------------------------------------------ Bankruptcy Law360 reports that Asarco LLP has agreed to pay $1.75 million to resolve claims related to a 1995 settlement in Texas involving the company's liability for environmental damage. Asarco on Tuesday asked the U.S. Bankruptcy Court for the Southern District of Texas to approve the settlement, according t Law360. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B. consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ATLANTIC MARINE: Moody's Keeps 'B2' Corporate After Sale to BAE --------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Atlantic Marine Holding Company, including the B2 corporate family, after the announced sale of Atlantic Marine to BAE Systems (Baa2/Stable). BAE Systems' press release of May 18, 2010, cited a definitive agreement to acquire Atlantic Marine from J.F. Lehman & Company for $352 million cash. Funding would come from BAE's existing cash resources. The acquisition would exclude Atlantic Marine's Boston and Philadelphia operations. The proposed acquisition, expected to close in Q3-2010, is subject to regulatory approval. According to Atlantic Marine, the transaction would trigger a change of control provision under its existing first lien credit agreement, and would require repayment of that facility's debt. (The first lien term loan had a $179 million balance, while the revolver was undrawn and backed about $23 million of letters of credit on March 31, 2010,.) As a result of all the rated debt being repaid ratings would be withdrawn at close. The B2 corporate family rating and stable outlook reflect Atlantic Marine's modest size and moderate leverage level and expectation of an adequate liquidity profile. The outlook acknowledges two leverage ratio covenant test step-downs upcoming: one in Q3-2010, and the other in Q4-2010,. Atlantic Marine finished Q1-2010, with over $20 million of cash, most of which should remain available in 2010, to prepay term loan if need be, to maintain next-twelve month covenant compliance. Other ratings affirmed: - Probability of default B3 - $45 million first lien revolver due 2013 B2 LGD 3, 36% - $179 million first lien term loan due 2014 B2 LGD 3, 36% Atlantic Marine Holding Company, headquartered in Jacksonville, FL, is a provider of ship maintenance, repair, overhaul, and conversion and marine fabrication services for U.S. Navy, government, commercial and offshore oil and gas industry vessels. The company operates shipyards and dry docking facilities in Jacksonville FL, Mobile AL, Mayport FL, Boston MA, Philadelphia PA, and Moss Point MS. Revenues for 2009, were $334 million. AVISTAR COMMS: Files Form 10-Q for March 31 Quarter --------------------------------------------------- Avistar Communications Corporation filed its quarterly report on Form 10-Q with the Securities and Exchange Commission. The Company disclosed that total revenue was $14.8 million, as compared to $2.6 million for the quarter ended March 31, 2009. The increase was primarily due to the license and sale of patents for $14.0 million which was recognized as revenue in the first quarter of 2010. Net income in the first quarter of 2010 was $10.2 million, or $0.26 per basic and diluted share, as compared to a net loss of $415,000, or a loss of $0.01 per basic and diluted share, in the first quarter of 2009. As of March 31, 2010, the Company had total assets of $2.070 million against total liabilities of $5.120 million, resulting in stockholders' deficit of $3.050 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62c2 About Avistar Communications Headquartered in San Mateo, California, Avistar Communications Corporation (Nasdaq: AVSR) -- http://www.avistar.com/-- holds a portfolio of 80 patents for inventions in video and network technology and licenses IP to videoconferencing, rich-media services, public networking and related industries. Current licensees include Sony Corporation, Sony Computer Entertainment Inc. (SCEI), Polycom Inc., Tandberg ASA, Radvision Ltd. and Emblaze-VCON. BARCALOUNGER CORP: Files for Chapter 11 to Sell Assets ------------------------------------------------------ Reuters reports that Barcalounger Corp. filed for bankruptcy protection under Chapter 11 in the U.S. Bankruptcy Court in Delaware, citing a sales downturn that left the Company unable to survive. According to Reuters, HPC3 Furniture Holdings agreed to bid for the Company's assets for $1.5 million. HPC3 Furniture will be deemed to have waived a $32.44 million claims against the Company if the sale is approved. The Company said it cannot generate enough profit to continue as a going concern because of the dire turn in national furniture sales due, in large part, to the global economic downturn. Barcalounger Corp. began making reclining chairs in World War II. The Company listed assets of between $1 million and $10 million, and debts of between $10 million and $50 million in its bankruptcy petition. Barcalounger said an affiliate of Los Angeles-based investment firm Hancock Park Associates owns all its equity. BBN MERCER: Case Summary & 7 Largest Unsecured Creditors -------------------------------------------------------- Debtor: BBN Mercer, LLC 107 Stokely Road, Suite 102 Wilmington, NC 28403 Bankruptcy Case No.: 10-03971 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court Eastern District of North Carolina (Wilson) Judge: Stephani W. Humrickhouse Debtor's Counsel: George M. Oliver, Esq. Oliver & Friesen, PLLC P.O. Box 1548 New Bern, NC 28563 Tel: (252) 633-1930 Fax: (252) 633-1950 E-mail: efile@oliverandfriesen.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of 7 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nceb10-03971.pdf The petition was signed by Mark Brisson, manager/member. BEVERAGE & MORE: S&P Changes 'B-' Corporate Outlook to Positive --------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on Concord, Calif.-based Beverages & More! Inc. to positive from negative. According to S&P: "At the same time, we are raising the issue- level rating on the company's senior secured notes to 'B-' from 'CCC+', revising the recovery rating to '4' from '5', and affirming our 'B-' corporate credit rating. The outlook revision reflects the strong performance over the past year during a difficult retail environment, the substantial improvement in credit metrics, and our expectation for continued operational gains over the near term. We are raising the issue-level rating because of the company's ability to manage its growth relatively well. In our view, this has resulted in a higher valuation since our initial assessment in 2007. "The speculative-grade ratings on Beverages & More! Inc. (BevMo) reflect the company's participation in the highly competitive alcoholic beverage retail industry, limited regional focus, small size and market share, dependency on product introductions from producers for growth, highly levered capital structure, and thin cash flow protection measures," said Standard & Poor's credit analyst David Kuntz. Performance was relatively robust over the past year despite modest top-line pressures. Operational gains were due in part to higher product margins. We anticipate that these good trends are likely to continue over the near term with improvements coming through new store growth, enhanced store profitability, positive operating leverage, and increasing economies of scale. BORGER HOSPITALITY: Files for Chapter 11 Bankruptcy Protection -------------------------------------------------------------- Greg Sherman at CBS 7 News says Borger Hospitality filed for Chapter 11 bankruptcy protection. Citizens National Bank and the company are waiting for a federal judge to approve a reorganization plan before work at Baymont Inns and Suites in Stanton can be completed. BROWN PUBLISHING: Dolan Media Objects to Sale to Insiders --------------------------------------------------------- Bloomberg News reports that Brown Publishing Co. is seeking approval from the Bankruptcy Court to implement an auction process to test whether there would be rival offers to the $15.9 million bid from insiders for the purchase of all of the Company's the publications. The prospective buyers include Roy Brown, the Company's president and chief executive officer. The Company had said no other possible buyer was willing to buy the assets on acceptable terms. According to Bloomberg, Dolan Media Co., the publisher of the Long Island Business News, recently filed papers in the Bankruptcy Court objecting to the proposed sale procedures and saying its attempts at negotiating a purchase were rebuffed. Dolan contends a breakup fee is unnecessary for the insiders. Dolan also believes an accelerated auction and the proposed terms of sale unfairly benefit insiders. About Brown Publishing Headquartered in Cincinnati, Ohio, The Brown Publishing Company owns business publications in Ohio, Utah, Texas, South Carolina, New York, and Iowa. Brown publishes 15 daily, 32 weekly, 11 business and 41 free publications. There are also 51 websites. Seventy-eight of the publications are in Ohio. Brown publishes Dan's Papers, the weekly newspaper with the largest circulation in the area of eastern Long Island, New York, known as the Hamptons. Brown also publishes the Montauk Pioneer, which it calls the official newspaper of Montauk, New York. The Company filed for Chapter 11 bankruptcy protection on April 30, 2010 (Bankr. E.D.N.Y. Case No. 10-73295). Edward M. Fox, Esq., at K&L Gates LLP, assists the Company in its restructuring efforts. The Company estimated its assets and debts between $10,000,001 and $50,000,000. CABLEVISION SYSTEMS: Posts $74.1MM Net Income for March 31 Qtr. --------------------------------------------------------------- Cablevision Systems Corporation filed its quarterly report on Form 10-Q, disclosing $74.1 million of net income on $1.7 billion revenues for the three months ended March 31, 2010, compared with net income of $21.0 million on $1.6 billion of revenue during the same period a year earlier. The Company's balance sheet at Dec. 31, 2010, showed $7.3 billion in total assets and $13.5 billion in total liabilities, for a stockholders' deficit of $6.2 billion. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a8 About Cablevision Systems Headquartered in Bethpage, New York, Cablevision Systems Corp. is predominantly a domestic cable TV multiple system operator serving approximately 3.1 million subscribers in and around the New York metropolitan area. Among other entertainment-and media-related business ventures, the company also owns and distributes programming to cable television and direct broadcast satellite providers throughout the United States through its Rainbow National Services subsidiary. Cablevision Systems reported net earnings of $285.3 million on revenue of $7.77 billion for the year ended December 31, 2009, compared with a net loss of $236.17 million on revenue of $7.23 billion for 2008. Cablevision reported $9.32 billion in total assets and $14.47 billion in total liabilities, resulting in a $5.16 billion stockholders' deficit as of December 31, 2009. * * * Cablevision carries Standard & Poor's 'BB' corporate credit rating and Moody's "Ba2" Corporate Family and Probability of Default Ratings. CALIFORNIA: Calpers Seeks Extra $600-Mil. Despite Budget Deficit ---------------------------------------------------------------- Michael B. Marois at Bloomberg's BusinessWeek reports that the 13- member governing board of the California Public Employees' Retirement System, the largest U.S. public pension, was set to vote Wednesday to increase the amount the state of California must pay as its share of retirement costs to $3.9 billion in the fiscal year that starts July 1. The state put in $3.3 billion this year. Calpers, according to the report, wants an extra $600.7 million from the state, which is confronting a $19 billion budget deficit. According to Bloomberg, Calpers managers have said the increase is needed after a 24% drop in the fund's value in the past fiscal year. Bloomberg relates that to help close the budget gap, Governor Arnold Schwarzenegger has proposed ending welfare programs and most day-care subsidies. He has said pension raises in 1999 by Democrats cost too much and has demanded lawmakers retract them. Gov. Schwarzenegger, 62, a two-term Republican, said in a statement Tuesday, "Every additional dollar we spend on state employee pensions is a dollar we take from education, health, and public safety." CALIFORNIA STEEL: S&P Affirms 'BB-' Corporate; Outlook Now Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on Fontana, Calif.-based California Steel Industries Inc. (CSI) to stable from negative. At the same time, S&P affirmed its ratings on the company, including its 'BB-' corporate credit rating. "The outlook revision reflects our expectation that California Steel is likely to achieve and sustain credit measures appropriate for the current 'BB-' rating over the intermediate term, given our assessment of the company's weak business risk profile, limiting the risk of a downgrade," said Standard & Poor's credit analyst Maurice Austin. This is due to our view that steel demand is experiencing an orderly increase. In addition, our base case macroeconomic assumption is for U.S. GDP to increase 3% in 2010 and expand by 2.9% in 2011. S&P said, "The stable outlook also incorporates our view that we expect California Steel's operating performance to continue to improve sequentially, after posting better-than-expected first- quarter performance, and that it will successfully negotiate a new credit facility before the current facility matures in September 2010." S&P said, "We expect 2010 EBITDA generation of about $100 million owing to higher volumes and pricing, resulting from improving end market demand. Under this scenario, total adjusted debt to EBITDA would decrease to less than 2x, a level we would consider good for a 'BB-' rating. In addition, we anticipate that EBITDA coverage of interest will be about 9.5x." CANDALYN LAUFER: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Candalyn Marie Laufer aka Candalyn Laufer 3794 Horizon Ridge Ct Simi Valley, CA 93063 Bankruptcy Case No.: 10-15847 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Central District Of California (San Fernando Valley) Judge: Geraldine Mund Debtor's Counsel: Philip D. Dapeer, Esq. Philip Daoeer, a Law Corporation 2625 Townsgate Rd Ste 330 Westlake Village, CA 91361 Tel: (323) 954-9144 Fax: (323) 954-0457 Scheduled Assets: $1,032,000 Scheduled Debts: $1,433,874 A list of the Company's 8 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-15847.pdf The petition was signed by Candalyn Marie Laufer. CAROLINA PARK: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Carolina Park Associates, LLC, a Delaware LLC c/o Republic Land Development 10340 Democracy Lane Suite 101 Fairfax, VA 22030 Bankruptcy Case No.: 10-03524 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court District of South Carolina (Charleston) Judge: David R. Duncan Debtor's Counsel: R. Geoffrey Levy, Esq. 2300 Wayne Street Columbia, SC 29201 Tel: (803) 256-4693 E-mail: llfecf@levylawfirm.org Estimated Assets: $100,000,001 to $500,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by David L. Peter, manager of Republic Charleston, LLC, the Debtor's managing member. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ MDC of Charleston, LLC $2,571,810 155 Flyway Drive Johns Island, SC 29455 Town of Mt. Pleasant, SC $500,000 100 Ann Edwards Lane Mount Pleasant, SC 29465 Seamon, Whiteside & Assoc Inc. $281,398 501 Wando Park Blvd. Suite 200 Mount Pleasant, SC 29464-7849 Republic Land Development, LLC $245,135 Roper St. Francis $207,934 Mount Pleasant Hospital Republic Charleston, LLC $154,125 McNair Law Firm, PA $105,542 Law Office of Joel J. Goldberg $57,080 Rawle-Murdy Associates, Inc. $39,475 East Cooper Community Outreach $20,000 The Greenery of Charleston $17,509 Carolina One Real Estate $15,711 Site Signatures, Inc. $13,334 Roper St. Francis Foundation $10,000 Atlas Signs, Inc. $5,471 Youth Empowerment Services Inc. $5,000 Haines and McNeill, LLC $2,846 Dell Financial Services $2,538 Try Marketing, Inc. $2,095 The Post and Courier $1,650 CATALYST PAPER: S&P Affirms 'CCC+' LT Corporate; Outlook Stable --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'CCC+' issue-level rating to Catalyst Paper Corp.'s US$110 million class B 11% senior secured notes due December 2016. S&P also assigned a '4' recovery rating to the notes, indicating average (30%-50%) recovery in the event of a default. At the same time, S&P revised the outlook on Catalyst to stable from negative. S&P affirmed the 'CCC+' long-term corporate credit rating on the company. "The outlook revision reflects the company's recent bond issuance, which we believe has improved liquidity and alleviated our concerns about the US$35 million notes due 2011," said Standard & Poor's credit analyst Jatinder Mall. "However, we expect Catalyst's operating performance to remain weak in 2010," Mr. Mall added. The ratings on Catalyst reflect S&P's view of the company's highly leveraged capital structure, history of weak profitability, fiber supply issues, and its participation in cyclical commodity markets. In Standard & Poor's opinion, these risks are partially mitigated by the company's revenue diversity and improving cost profile. Catalyst is a diverse manufacturer of specialty mechanical printing papers, newsprint, and pulp, with a combined annual production capacity of 2.5 million metric tons. It has six production facilities in B.C. and Arizona. The stable outlook reflects Standard & Poor's view that the recent notes issuance has bolstered Catalyst's liquidity and, while we expect the company to have negative free cash generation in 2010, we believe there will be enough liquidity to fund 2011 debt maturity obligations. We could lower the ratings on Catalyst if negative cash generation leads to a liquidity position of less than C$100 million. An upgrade would require that Catalyst demonstrate sustained improvement in its operating profit and cash flow generation, and a leverage ratio that is below 5x and a funds from operations-to-debt ratio of 15%-20%. CELL THERAPEUTICS: Posts $26 Million Net Loss for First Quarter --------------------------------------------------------------- Cell Therapeutics Inc. filed with the Securities and Exchange Commission its Form 10-Q for the quarterly period ended March 31, 2010. The Company reported a net loss of $26.9 million on $20,000 of total revenues for the three months ended March 31, 2010, compared with a net loss of $14.9 million net loss on $20,000 of total revenues for the same period a year ago. The Company has not recorded revenues from product sales. "Currrently, we do not have a marketed product, and unless we are able to develop one of our product candidates, such as pixantrone, into an approved commercial product, we will not generate any significant revenues from product sales, royalty payments, license fees or otherwise." License and contract revenue for the three months ended March 31, 2010 and 2009 represents recognition of deferred revenue from the sale of Lisofylline material to DiaKine. The Company's balance sheet at March 31, 2010, showed $75.5 million in total assets and $85.2 million total liabilities, for a $10.1 million stockholders' deficit. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6201 About Cell Therapeutics Headquartered in Seattle, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company that develops an integrated portfolio of oncology products aimed at making cancer more treatable. Subsequent to the closure of its Bresso, Italy operations in September 2009, CTI's operations are conducted solely in the United States. The Company reported $69.59 million in total assets and $87.73 million in total liabilities, resulting in $18.76 million in stockholders' deficit at Dec. 31, 2009. Going Concern Doubt San Francisco-based Stonefield Josephson, Inc., has included an explanatory paragraph in their report on Cell Therapeutics, Inc.'s December 31, 2009, 2008 and 2007 consolidated financial statements regarding their substantial doubt as to the Company's ability to continue as a going concern. The independent auditors reported that the Company has sustained loss from operations over the audit periods, incurred an accumulated deficit, and has substantial monetary liabilities in excess of monetary assets as of December 31, 2009. Bankruptcy Warning In its Form 10-Q report for the period ended September 30, 2009, filed with the Securities and Exchange Commission, the Company warned it does not expect it will have sufficient cash to fund planned operations through the second quarter of 2010, which raises substantial doubt about its ability to continue as a going concern. The Company said if it fails to obtain capital when required, the Company said it may be required to delay, scale back, or eliminate some or all of its research and development programs and may be forced to cease operations, liquidate its assets and possibly seek bankruptcy protection. CENTAUR LLC: Wells Fargo Lashes Out at Disclosure Statement ----------------------------------------------------------- Wells Fargo Bank NA is lashing out at Centaur LLC's disclosure statement, arguing that it ignores the complexities of the bankrupt casino and racetrack operator's organizational structure, asset ownership arrangements and creditor constituencies, according to Bankruptcy Law360. Indianapolis, Indiana-based, Centaur, LLC, aka Centaur Indiana, LLC -- http://www.centaurgaming.net/-- is an company involved in the development and operation of entertainment venues focused on horse racing and gaming. The Company filed for Chapter 11 bankruptcy protection on March 6, 2010 (Bankr. D. Delaware Case No. 10-10799). Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $500,000,001 to $1,000,000,000 as of the Petition Date. CINCINNATI BELL: Shareholders Elect Nominees for Directors ---------------------------------------------------------- Shareholders of Cincinnati Bell Inc. elected each of the Company's nominees for director to serve a one-year term until the 2011 Annual Meeting of Shareholders and until their respective successors were elected and qualified. Shareholders also ratified the Audit and Finance Committee's appointment of Deloitte & Touche LLP to serve as the Company's independent registered public accounting firm for the fiscal year ending December 31, 2010. About Cincinnati Bell Cincinnati Bell Inc., with headquarters in Cincinnati, Ohio, provides telecommunications products and services to residential and business customers in Ohio, Kentucky and Indiana. CBB generated $1.3 Billion in revenues in 2009. * * * Fitch Ratings has placed Cincinnati Bell Inc.'s (CBB) 'B+' Issuer Default Rating (IDR) on Rating Watch Negative. In addition, the Negative Watch applies to CBB's security ratings, as well as the subsidiary ratings. The Company's balance sheet at March 31, 2010, showed $2.5 billion in total assets and $3.2 billion in total liabilities, for a $634.6 million total stockholders' deficit. CINCINNATI BELL: Posts $2.6-Mil. Net Income for March 31 Quarter ---------------------------------------------------------------- Cincinnati Bell Inc. filed its quarterly report Form 10-Q, showing $2.6 million of net income on $323.7 million of total revenue for the three months ended March 31, 2010, compared with a net income of $28.8 million on $325.5 million of total revenue during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $2.5 billion in total assets and $3.2 billion in total liabilities, for a $634.6 million total stockholders' deficit. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6296 About Cincinnati Bell Cincinnati Bell Inc., with headquarters in Cincinnati, Ohio, provides telecommunications products and services to residential and business customers in Ohio, Kentucky and Indiana. CBB generated $1.3 Billion in revenues in 2009. * * * Fitch Ratings has placed Cincinnati Bell Inc.'s (CBB) 'B+' Issuer Default Rating (IDR) on Rating Watch Negative. In addition, the Negative Watch applies to CBB's security ratings, as well as the subsidiary ratings. CITGO PETROLEUM: Moody's Affirms Ba2 Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service affirmed CITGO Petroleum Corporation's Ba2 Corporate Family Rating and assigned a Ba2 rating (LGD 3, 41%) to CITGO's $300 million Term Loan B facility due 2015 and its $1.5 billion of senior secured notes, downgraded the rating on its pollution control bonds to Ba2 (LGD 3, 41%), and upgraded the PDR rating to Ba2 from Ba3. It also assigned a Ba1 rating (LGD 3, 39%) to the company's proposed $700 million revolving credit facility due 2013. The outlook for the ratings is stable. Moody's will withdraw the existing Ba1 ratings for the Senior Secured Term Loan, Term Loan B ratings and floating rate IRBs upon completion of the new financings. CITGO will use most of the proceeds from the notes and Term Loan B to repay $1.7 billion of outstanding Term Loans A & B and its floating rate industrial revenue bonds. The new $700 million revolver will remain undrawn as a source of liquidity for CITGO. The affirmation of the CFR reflects prospects for modestly improved financial results in 2010, despite a continuing difficult refining environment, the near-term expected settlement of the note receivable from its parent, Petr�leos de Venezuela (PDVSA), and the improved liquidity and financial flexibility that CITGO will derive from the financings, which also provide a strong collateral package to creditors. CITGO sustained a net loss of $137.8 million in 2009, driven primarily by narrowing light/heavy crude differentials and weak product demand. Prospects for 2010, are modestly improved although the company could again be cash flow negative after capital spending. However, PDVSA has accelerated repayment of balances due under its loan payable to CITGO, with the expectation that the intercompany loan will be completely repaid sometime in the third quarter of 2010,. Including these proceeds, CITGO must be able to fully fund its capital spending in 2010, without increasing debt. In addition, while capital spending will remain elevated for investments to manufacture ultra-low sulfur diesel, the company is taking steps to enhance liquidity and working capital management. CITGO's liquidity will improve as a result of the new financings, with some $700 million in unused revolving credit capacity extended to 2013, cash on the balance sheet, and the repayment of variable rate IRBs that had required backing of letters of credit. The refinancing will defer significant required debt reduction to beyond 2012, including the amortizing Term Loan B. Creditors also will benefit from an expanded collateral package including all three of CITGO's large-scale refineries, its inventories, and a portion of its accounts receivable. Collateral coverage, including a fully drawn revolving credit, is estimated at 3.6X total debt. While all of the creditors rank pari passu, in default any borrowings under the revolving credit facility will have a first claim on a significant portion of inventories and is cushioned by significant liabilities below it in the capital structure. As a result, the revolver is rated one notch above the Term Loan B, senior secured notes, and other bonds, reflecting both the revolver's relatively stronger overcollateralization and its smaller share of CITGO's proforma capital structure. Moody's notes that underlying the CITGO's Ba2 CFR is a baseline credit assessment of 13 (corresponding to Ba3). CITGO, as a wholly-owned subsidiary of PDVSA, is subject to joint default analysis as a government-related issuer. Moody's last rating action affecting CITGO occurred on September 29, 2009, when its ratings were downgraded. CITGO Petroleum Corporation is headquartered in Houston, Texas. Petroleos de Venezuela is located in Caracas, Venezuela. CHEMTURA CORP: Proposed Diacetyl Claimants Panel Draws Objections ----------------------------------------------------------------- Karen Smith and certain other diacetyl claimants against Chemtura Corp. have asked the United States Bankruptcy Court for the Southern District of New York to appoint: -- an official committee of holders of direct claims for diacetyl-related personal-injury or wrongful death; or -- a diacetyl claimants' subcommittee of the Official Committee of Unsecured Creditors, whose role would be limited to representing the diacetyl claimants' constituency in connection with the estimation of the Debtors' diacetyl liability and the formulation and confirmation of a Chapter 11 plan, with the ability to hire its own professionals. In separate filings, Irma Mancilla f/k/a Irma Ortiz, Victor Mancilla, and Ricardo Corona, all Diacetyl Claimants, and the Ad Hoc Committee of Tort Claimants submitted to the Court joinders to the request of certain Diacetyl Claimants for the appointment of an official committee to represent diacetyl claimholders. Diacetyl Claimants Committee is Not Warranted, Creditors' Committee Asserts The Official Committee of Unsecured Creditors avers that it is sympathetic to all individuals that have suffered injury as a result of exposure to diacetyl. In fact, through its participation in the Estimation Proceeding and insurance-related litigation, the Creditors' Committee seeks to ensure that appropriate reserves are established and sources of recovery made available to satisfy valid diacetyl-related claims against the Debtors' estates, according to Daniel H. Golden, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York. The Creditors' Committee, however, says it does not support the Smith Claimants' efforts to transfer the costs of their participation in the Estimation Proceeding and plan process to all unsecured creditors under the guise of procuring adequate representation for diacetyl claimants. "The Smith Claimants have alleged no valid basis upon which the Court could reasonably conclude that the Creditors' Committee is so crippled by conflict as to be unable to function, or that the diacetyl claimants cannot participate in these Chapter 11 cases without official committee status," Mr. Golden argues. Contrary to the Smith Claimants' assertions, the current constitution of the Creditors' Committee is an appropriate cross- section of the Debtors' unsecured creditor constituency, Mr. Golden asserts. He maintains that the Creditors' Committee is working hard to maximize recoveries not solely for the benefit of commercial creditors, but for the benefit of all those who hold valid unsecured claims against the Debtors' estates, including diacetyl claimants. Mr. Golden further contends that: -- The nature of the Debtors' Chapter 11 cases mitigate against appointing a diacetyl claimants' committee. He notes that although the estimation of diacetyl claims has become an important issue in these Chapter 11 cases, the Debtors were not driven into bankruptcy by pending tort liability. -- The Smith Claimants have not demonstrated that the Creditors' Committee desires differ materially from their own. -- The Smith Claimants have failed to demonstrate that they meet the high threshold necessary to establish the additional cost of an official diacetyl claimants' committee is justified. For these reasons, the Creditors' Committee asks the Court to deny the diacetyl official committee appointment request. Citibank, N.A., as administrative agent for the lenders party to the Amended and Restated Senior Secured Superpriority Debtor-in- Possession Credit Agreement, joins in the Creditors' Committee's objection. Appointment Request is Not Based on "Fairness," Debtors Complain Richard M. Cieri, Esq., at Kirkland & Ellis LLP, in New York, argues that the Smith Claimants' Request is not about "fairness" and "adequate representation" because they are ably represented by Humphrey Farrington & McClain P.C. and Caplin & Drysdale, Chartered. "This motion is about money and leverage in negotiations," Mr. Cieri tells the Court. Mr. Cieri points out that the Office of the United States Trustee has twice declined to appoint a diacetyl claimants' committee because appointment: (1) is not warranted under applicable law in the Southern District of New York; and (2) would be inconsistent with the Court's decision in the Chapter 11 case of General Motors Corporation, which the Court had commended to the parties as relevant precedent. For these reasons, the Debtors ask the Court to decline appointment of a diacetyl claimants' committee to pursue the narrow interests of the diacetyl claimants. In a separate filing, the Official Committee of Equity Security Holders joins in the Debtors' objection. * * * The hearing to consider the appointment request for an official diacetyl claimants committee has been adjourned to June 17, 2010, at 9:45 a.m. A hearing was previously scheduled for May 18, 2010 for the appointment motion. About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHEMTURA CORP: Modifies Incentive Plan to Address Issues -------------------------------------------------------- Chemtura Corp. and its units filed a supplement to their 2010 Key Employee Incentive Plan, which addresses these two areas of concern raised by the U.S, Bankruptcy Court at the conclusion of the April 19, 2010, hearing on the Debtors' 2010 Employee Incentive Plan Motion: (1) The Court's requirement that the Debtors modify the proposed 2010 Key Employee Incentive Plan to ensure that payments under the 2010 Management Incentive Plan could not be earned at consolidated earnings before income taxes, depreciation, and amortization levels less than $264,500,000; and (2) The Court's question regarding whether Consolidated and Business Unit EBITDA is the right metric to use in establishing target payouts under the 2010 KEIP and if so, whether there is a practical way to "control" for macroeconomic factors and isolate the role that employee performance alone may have in the Debtors reaching their Consolidated EBITDA targets. In light of the Court's instructions, the Debtors made certain modifications to the proposed 2010 Management Incentive Program to modify both the threshold for achieving any payout and the "target" Consolidated EBITDA at which 100% of the targeted 2010 MIP payout would be earned, Richard M. Cieri, Esq., at Kirkland & Ellis LLP, in New York, relates. The Debtors have addressed the Court's instruction that the MIP should provide no incentive compensation for replicating the previous year's results by increasing the Consolidated EBITDA threshold required for payment under the 2010 MIP to $264,500,000, thereby eliminating the possibility of payment where the actual 2010 results are no better than the 2009 results, Mr. Cieri says. Under the revised MIP payment metric, the 2010 MIP payout would be $0 at a Consolidated EBITDA of $264,500,000 and the payout would increase incrementally at Consolidated EBITDA levels above $264.5 million, Mr. Cieri explains. The new MIP compensation structure is available for free at: http://bankrupt.com/misc/ChemAm2010metric.pdf USW Objects The United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union points out that the Debtors failed to establish a threshold that takes into account actual 2009 EBITDAR results and current assumptions about external economic factors. James L. Linsey, Esq., at Cohen Weiss and Simon LLP, in New York -- jlinsey@cwsny.com -- also notes that the Debtors failed to comply with the Court's direction to propose an incentive plan based on adequate targets which minimize the impact of external economic factors. For these reasons, the USW asks the Court to deny approval of the supplement to the Debtors' 2010 KEIP. About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHEMTURA CORP: Court Sustains Committee Objection to CERT Claims ---------------------------------------------------------------- Bankruptcy Judge Robert Gerber has officially sustained the Official Committee of Unsecured Creditors' objection to three claims, asserting $3,000,000,000 each, filed by the Counsel for Education and Research on Toxics against Chemtura Corporation and its debtor-affiliates for injuries attributable to certain chemicals the Debtors previously produced as a flame retardant. The Court acknowledged that CERT is a California public benefit corporation established for the stated purpose of educating and conducting research regarding toxic substances. Judge Gerber, however, says that "while CERT has identified an unsubstantiated injury to humans and animals generally, CERT does not specifically identify an actual, particularized injury to CERT." "Thus, CERT lacks standing to sue the Debtors in a relevant non- bankruptcy forum, is not a creditor of the Debtors' estates because it possesses no prepetition right to payment, and lacks authority to file proofs of claim in the Debtors' cases," Judge Gerber opined. The Court also found that facts before it do not justify authorizing CERT to amend its claims. Judge Gerber further said each of the new claim CERT purports to bring against the Debtors suffers from a number of legal and procedural defects. The purported new claims were based on grounds of medical monitoring, public nuisance, California Business and Professions Code and federal environmental statutes. Accordingly, in a signed findings of fact, conclusions of law, and order sustaining the Objection, the Court ruled that CERT's Proofs of Claim are disallowed and expunged in their entirety. A full-text copy of the 24-page signed Order is available for free at http://bankrupt.com/misc/ChemOrdCERTCs.pdf About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHEMTURA CORP: Reports $177 Million Net Loss for First Quarter -------------------------------------------------------------- Chemtura Corporation, debtor-in-possession, has filed its Quarterly Report on Form 10-Q for the first quarter of 2010. For the first quarter of 2010, the Company recorded net loss from continuing operations on a GAAP basis of $177 million, or $0.73 per share, and net earnings on a managed basis of $1 million, or $0.01 per share. First Quarter 2010 Business Segment Highlights * Consumer Performance Products net sales increased 8% or $7 million compared with the first quarter of 2009 due to increased sales volume and favorable foreign currency translations. Volume benefited from the warmer weather towards the end of the quarter. Operating profit on a managed basis increased $4 million primarily due to the benefit of increases in sales volume, favorable mix and lower raw material and energy costs. On a GAAP basis, operating profit increased $2 million. * Industrial Performance Products net sales increased 39% or $80 million driven primarily by increased sales volume. The increased volume reflects increased customer demand across all business segments due to general economic improvements and also some inventory replenishments. Operating profit on a managed basis increased $18 million primarily due to increased sales volume and lower manufacturing, raw material and energy costs. On a GAAP basis, operating profit increased $20 million. * AgroSolutions Engineered Products (formerly known as Crop Protection Engineered Products) net sales declined 6% or $4 million primarily due to lower sales volume. Demand continued to be affected by lower agricultural commodity prices and the impact of the reduced availability of credit to growers as well as a prolonged winter in Europe. The operating loss of $1 million was unfavorable by $17 million compared with an operating profit of $16 million for the first quarter of 2009 primarily due to the impact of lower sales volume, a product cancellation in the European market, the resulting impact of unfavorable manufacturing costs and an increase in selling, general and administrative and research and development costs of which approximately $4 million related to expenses associated with the internal review of customer incentive, commission and promotional payment practices in the European region. * Industrial Engineered Products net sales increased 54% or $56 million primarily due to increased sales volume. Products sold to electronic applications showed the most dramatic year-over-year improvement but some recovery was also evident in building and construction, and consumer durable polymer applications from the low levels of demand in the first quarter of 2009 when the recession had taken hold. Operating profit on a managed basis increased $22 million from the first quarter of 2009 primarily due to improved sales volume and lower manufacturing, raw material and energy costs. * Corporate expense for the first quarter of 2010 was $27 million compared with $31 million in the same quarter last year. Corporate expense included amortization expense related to intangibles of $9 million for the first quarters of 2010 and 2009. The decrease in corporate expense of $4 million was primarily related to a charge in the first quarter of 2009 to write-off legacy SAP assets and decreases in other costs. A full-text copy of Chemtura Corporation's First Quarter 2010 Financial Results on Form 10-Q is available at: http://ResearchArchives.com/t/s?625f Chemtura Corporation and Subsidiaries Consolidated Balance Sheet As of March 31, 2010 ASSETS Current assets Cash and cash equivalents $159,000,000 Accounts receivable 521,000,000 Inventories 515,000,000 Other current assets 259,000,000 Assets held for sale 85,000,000 -------------- Total current assets 1,539,000,000 Non-current assets Property, plant & equipment 713,000,000 Goodwill 231,000,000 Intangible assets, net 455,000,000 Other assets 174,000,000 -------------- Total assets $3,112,000,000 ============== LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities Short-term borrowings $301,000,000 Current portion of long-term debt 0 Accounts payable 157,000,000 Accrued expenses 182,000,000 Income taxes payable 4,000,000 Liabilities held for sale 36,000,000 -------------- Total current liabilities 680,000,000 Non-current liabilities Long-term debt 2,000,000 Pension and post-retirement health care 143,000,000 Other liabilities 190,000,000 -------------- Total liabilities not subject to compromise 1,015,000,000 Liabilities subject to compromise 2,104,000,000 Stockholders' equity Common stock 3,000,000 Additional paid-in capital 3,040,000,000 Accumulated deficit (2,661,000,000) Accumulated other comprehensive loss (233,000,000) Treasury stock (167,000,000) -------------- Total Chemtura Corp. stockholders' equity (18,000,000) Non-controlling interest 11,000,000 Total stockholders' equity (7,000,000) -------------- Total liabilities and stockholders' equity $3,112,000,000 ============== Chemtura Corporation and Subsidiaries Unaudited Consolidated Statement of Operations For the quarter ended March 31, 2010 Net sales $603,000,000 Cost of goods sold 469,000,000 Selling, general and administrative 76,000,000 Depreciation and amortization 49,000,000 Research and development 9,000,000 Facility closures & severance 2,000,000 Antitrust costs - Loss on sale of business - Impairment of long-lived assets - Changes in estimates related to expected 122,000,000 allowable claims Equity income - -------------- Operating income(loss) (124,000,000) Interest expense (12,000,000) Loss on early extinguishment of debt (13,000,000) Other (expense)income, net (2,000,000) Reorganization items, net (21,000,000) -------------- Income(Loss) before income taxes (172,000,000) Income tax benefit (expense) (5,000,000) -------------- Income from continuing operations (177,000,000) Gain(Loss) on sale of discontinued operations (2,000,000) -------------- Net income(loss) ($179,000,000) ============== Chemtura Corporation and Subsidiaries Consolidated Statement of Cash Flows For the quarter ended March 31, 2010 CASH FLOWS FROM OPERATING ACTIVITIES Net loss ($179,000,000) Adjustments to reconcile loss to cash Loss on early extinguishment of debt 13,000,000 Depreciation and amortization 49,000,000 Stock-based compensation expense - Reorganization items, net 2,000,000 Changes in estimates related to expected 122,000,000 allowable claims Changes in assets and liabilities, net Accounts receivable (97,000,000) Impact of accounts receivable facilities - Inventories (29,000,000) Accounts payable 32,000,000 Pension and post-retirement health care (7,000,000) liabilities Liabilities subject to compromise (1,000,000) Other (14,000,000) -------------- Cash (used in)provided by operating activities (109,000,000) CASH FLOWS FROM INVESTING ACTIVITIES Net proceeds from divestments - Payments for acquisitions, net - Capital expenditures (14,000,000) -------------- Net cash used in investing activities (14,000,000) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from DIP credit facility, net 299,000,000 (Payments on) proceeds from credit facility (250,000,000) Proceeds from 2007 Credit Facility, net 15,000,000 Proceeds from short-term borrowings - Payments for debt issuance costs (16,000,000) -------------- Net cash provided by financing activities 48,000,000 CASH AND CASH EQUIVALENTS Effect of exchange rates (2,000,000) -------------- Change in cash and cash equivalents (77,000,000) -------------- Cash and cash equivalents, beginning of period 236,000,000 -------------- Cash and cash equivalents, end of period $159,000,000 ============== About Chemtura Corp. Based in Middlebury, Connecticut, Chemtura Corporation (CEM) -- http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a global manufacturer and marketer of specialty chemicals, crop protection products, and pool, spa and home care products. Chemtura Corporation and 26 of its U.S. affiliates filed voluntary petitions for relief under Chapter 11 on March 18, 2009 (Bankr. S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel. Wolfblock LLP serves as the Debtors' special counsel. The Debtors' auditors and accountant are KPMG LLP; their investment bankers are Lazard Freres & Co.; their strategic communications advisors are Joele Frank, Wilkinson Brimmer Katcher; their business advisors are Alvarez & Marsal LLC and Ray Dombrowski serves as their chief restructuring officer; and their claims and noticing agent is Kurtzman Carson Consultants LLC. As of December 31, 2008, the Debtors had total assets of $3.06 billion and total debts of $1.02 billion. Bankruptcy Creditors' Service, Inc., publishes Chemtura Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Chemtura Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITADEL BROADCASTING: Judge Formally Approves Reorganization Plan ----------------------------------------------------------------- Bankruptcy Judge Burton R. Lifland wrote a 43-page document containing findings of fact, conclusions of law and order confirming the reorganization plan of Citadel Broadcasting Corp. According to the ruling, the Court found that Louis G. Zachary of Lazard Freres & Co., LLC, was credible and that the value of the Debtors is $2.04 billion, representing the midpoint of the credible and reliable testimony of Mr. Zachary, Citadel's financial advisor and investment banker. With respect to the shareholders' other proffered expert, Professor Gregg Jarrell, the Court found that the objectors did not carry their burden of establishing that Professor Jarrell was qualified to opine on the valuation of a radio broadcasting company, as opposed to general valuation principles, and thus that there was no "nexus between his credentials and the subject matter of his testimony." A copy of the Confirmation Order is available for free at: http://bankrupt.com/misc/Citadel_Plan_Order.pdf Contested Confirmation Hearings The court overruled objections by shareholders. The confirmation hearing of the Plan started on May 12, 2010, and Judge Lifland adjourned the hearing until May 17, 2010. The Debtors' valuation was heavily contested during the hearings. Shareholders led by Aurelius Capital Partners LP argued that the Debtors were valued too low, which does not leave anything for equity holders. As previously reported, the Plan calls for senior lenders led by J.P. Morgan Chase & Co., who are owed about $2.1 billion, to receive 90% of Citadel's equity plus a new $762 million loan. Holders of unsecured claims are to receive 10% of the stock in addition to $36 million in cash. Equity holders will receive nothing. During the May 12 hearing, Farid Suleman, chairman of the board and chief executive officer of Citadel Broadcasting Corporation, defended the Debtors' valuation after Lazard Freres & Co. LLC, the Debtors' financial advisor, updated the 2010 projections, which increased valuation to reflect a higher estimate. Specifically, the Debtors raised projections for 2010 to $232.4 million from $210 million. Lazard increased its valuation of the company based on the new projections. Mr. Suleman explained that the Debtors revised the financial projections because of "better-than- expected" first quarter results but added that growth later in 2010 will be slow due to difficult comparisons with last year's numbers. However, Aurelius was still not satisfied. Its counsel, Allan S. Brilliant, Esq., at Dechert LLP, in New York, argued that Lazard's projections are not reliable. Aurelius valued the Debtors at $2.6 billion, according to Bloomberg News. Louis G. Zachary, Jr., a managing director at Lazard Freres, said the Debtors' value is between approximately $1.910 billion to $2.165 billion, with a mid-point estimate of $2.040 billion, which is less than the $2.28 billion in secured and unsecured claims. Mr. Zachary asserted at the May 12 hearing that the projections are appropriate. In addition, Mr. Zachary noted that no investors sent expressions of interests to acquire the Debtors since the summer when they were looking to either restructure debt or be acquired. After the May 12 Hearing, Michael D. Kang, a managing director with Alvarez & Marsal North America LLC, the Debtors' restructuring advisor, in further support of the Plan, submitted his estimate of the total amount of the Debtors' secured and unsecured claims, which would need to be satisfied in full before holders of interests could receive a recovery in accordance with the "absolute priority" rule. A copy of Mr. Kang's estimates is available for free at: http://bankrupt.com/misc/CtdlKangEsts.pdf On May 17, the Courtroom was packed with more than 55 people for the second of a two-day confirmation hearing during which time Judge Lifland heard testimony from bankers, analysts and Citadel's top executives about the fairness of the valuation, notes Bloomberg News. To fast track the hearing, Judge Lifland refused to hear the testimonies of two of Aurelius' expert witnesses, one of which is Gregg Jarrell, a professor of finance at the University of Rochester, saying the witness didn't have expertise in valuations of broadcasting companies. "We're dealing with the radio industry sandbox and there are a lot of nuances in that sandbox," Bloomberg News quoted Judge Lifland as saying. Judge Lifland did allow Christopher Ensley, a former radio industry analyst at Bear Stearns, to testify for Aurelius, after giving him approximately an hour to prepare his testimony. Aurelius' counsel, Allan S. Brilliant, Esq., at Dechert LLP, in New York, argued for more time to prepare Mr. Ensley's testimony but Judge Lifland denied his request. After Judge Lifland made his decision to confirm the Plan, Mr. Brilliant was asked by Bloomberg News if Aurelius would appeal the ruling but Mr. Brilliant said he had no comment. "We're glad it's over and we can get on with running the company," Mr. Suleman said in a Bloomberg interview. Prior to the Court's approval of the Plan, the Debtors pointed out that Aurelius bought 17.3 million shares of the Debtors' common stock for $1.35 on March 30, 2010, so it knew that shareholders will not receive anything. The Debtors first submitted their Plan and accompanying Disclosure Statement on February 3, 2010. Judge Lifland approved the Disclosure Statement on March 15, 2010. Plan Supplements In support of their Chapter 11 Plan of Reorganization, the Debtors amended the list of rejected executory contracts and unexpired leases and the list of assumed executory contracts and unexpired leases, which were attached as supplements to the Plan. A copy of the amended list of rejected executory contracts and unexpired leases is available for free at: http://bankrupt.com/misc/CtdlAmLstRejCons.pdf A copy of the amended list of assumed executory contracts and unexpired leases is available for free at: http://bankrupt.com/misc/CtdlAmLstAssCons.pdf As previously reported, 60 Monroe Center LLC filed an objection to the cure amounts set in the List of Assumed Contracts arguing that the amounts fail to satisfy all existing defaults under certain contracts. Subsequently, 60 Monroe withdrew its objection. About Citadel Broadcasting Citadel Broadcasting Corporation (OTC BB: CTDB) -- http://www.citadelbroadcasting.com/-- is the third largest radio group in the United States, with a national footprint reaching more than 50 markets. Citadel is comprised of 166 FM stations and 58 AM stations in the nation's leading markets, in addition to Citadel Media, which is one of the three largest radio networks in the United States. Citadel Broadcasting filed for Chapter 11 with 50 affiliates on Dec. 20, 2009, in Manhattan (Bankr. S.D.N.Y. Case No. 09-17422). The Company listed assets of $1.4 billion and debt of $2.5 billion in its Chapter 11 filing. Kirkland & Ellis LLP is serving as legal counsel and Lazard Freres & Co. LLC. As financial advisor for the restructuring. Kurtzman Carson Consultants is serving as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Citadel Broadcasting Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Citadel Broadcasting Corp. and other affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITADEL BROADCASTING: Proposes to Assume ACE Insurance Policies --------------------------------------------------------------- Citadel Broadcasting Corp. and its units ask the U.S. Bankruptcy Court for authority to assume certain prepetition insurance agreements issued to the Debtors by ACE American Insurance Company and its affiliates, including ESIS, Inc., a third party administrator. In addition, the Debtors ask the Court to: -- authorize them to enter into certain postpetition insurance agreements with ACE, renew or extend a certain "Letter of Credit" and, in connection therewith, provide collateral; -- permit ACE to draw upon the Letter of Credit and apply the proceeds to the Debtors' obligations under a certain "ACE Insurance Program"; -- grant ACE a superpriority security interest in and liens on the Collateral provided by the Debtors to ACE and the proceeds thereof and on all of the Debtors' right, title and interest, if any, in the Letter of Credit and the proceeds thereof; -- provide that the ACE Insurance Program and the order will not be altered by any plan of reorganization or other order of the Court; -- provide that the Letter of Credit and all Collateral provided by the Debtors to ACE and the proceeds thereof will secure all obligations of the Debtors to ACE under the ACE Insurance Program; and -- grant related relief including, but not limited to, the authority to enter into amendments, endorsements, renewals or extensions of the Postpetition Insurance Agreements or new policies and agreements without further notice, hearing or order of the Court. Jonathan S. Henes, Esq., at Kirkland & Ellis LLP, in New York, relates that before the Petition Date, ACE issued various insurance policies to certain of the Debtors and in connection with the issuance, ACE and the Debtors entered into certain related agreements. He notes that recently, the Debtors commenced negotiations with ACE regarding the extension of insurance coverage. The Debtors and ACE agreed to the terms of new workers' compensation and automobile liability policies to be issued for the period beginning June 12, 2010, at 12:01 a.m., through June 12, 2011, at 12:00 a.m. Pursuant to the Prepetition Insurance Agreements and the Postpetition Insurance Agreements, the Debtors are obligated to, among other things, pay insurance premiums, deductibles and related charges and expenses to ACE. Mr. Henes reveals that the Debtors' obligations are payable over an extended period of time and are subject to future audits and adjustments and the aggregate estimated premium payable to ACE with respect to the Postpetition Insurance Agreements is $486,205. He adds that over time, the Debtors will owe additional amounts on account of deductibles and other obligations with respect to claims made under the policies. As security for the Debtors' obligations under the Prepetition Insurance Agreements, the Debtors provided ACE with a letter of credit before the Petition Date totaling $2,329,545 and a paid loss deposit fund. In connection with the Postpetition Insurance Agreements, the Debtors have agreed to extend or renew the Letter of Credit and provide an additional $18,006 for the PLDF, Mr. Henes further relates. The Postpetition Insurance Agreements also require that: (a) ACE may draw upon the Letter of Credit and apply the proceeds to the Debtors' obligations under the ACE Insurance Program; (b) ACE be granted a superpriority and exclusive security interest in and liens on (i) the Collateral provided by the Debtors to ACE and its proceeds and (ii) on all of the Debtors' right, title and interest, if any, in the Letter of Credit and its proceeds; (c) the Debtors be authorized to enter into additional renewals or extensions of the insurance policies and provide additional letters of credit without further order of the Court; (d) the ACE Insurance Program and the Order will not be altered by any plan of reorganization, order confirming a plan of reorganization or other order of the Court; and (e) the Letter of Credit and all Collateral provided by the Debtors to ACE and the proceeds thereof will secure all obligations of the Debtors to ACE under the ACE Insurance Program. A list of the Prepetition Insurance Agreements is available for free at http://bankrupt.com/misc/CtdlACEPrepAgrmts.pdf In separate filings, the Debtors sought and obtained a Court order shortening the presentment of the Request. The presentment of the Request is scheduled for May 26, 2010, at 12:00 p.m., and the deadline for filing objections is set for May 24, 2010, at 5:00 p.m. About Citadel Broadcasting Citadel Broadcasting Corporation (OTC BB: CTDB) -- http://www.citadelbroadcasting.com/-- is the third largest radio group in the United States, with a national footprint reaching more than 50 markets. Citadel is comprised of 166 FM stations and 58 AM stations in the nation's leading markets, in addition to Citadel Media, which is one of the three largest radio networks in the United States. Citadel Broadcasting filed for Chapter 11 with 50 affiliates on Dec. 20, 2009, in Manhattan (Bankr. S.D.N.Y. Case No. 09-17422). The Company listed assets of $1.4 billion and debt of $2.5 billion in its Chapter 11 filing. Kirkland & Ellis LLP is serving as legal counsel and Lazard Freres & Co. LLC. As financial advisor for the restructuring. Kurtzman Carson Consultants is serving as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Citadel Broadcasting Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Citadel Broadcasting Corp. and other affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITIGROUP INC: Parsons Cedes Director-Recruiting Role to Taylor --------------------------------------------------------------- Bloomberg News reports that Citigroup Inc. Chairman Richard Parsons relinquished some of his duties at the U.S. bank after revamping the board of directors over the past year under government pressure. Mr. Parsons, 62, gave up his role as head of the board's nomination and governance committee last month, according to Citigroup's Web site. Diana Taylor, a former New York banking superintendent who joined the board in July 2009, took over leadership of the committee, which sets corporate governance policies and identifies director candidates. As head of the nomination committee, Mr. Parsons led the bank's recruitment of eight directors following the bank's $45 billion government bailout in 2008. With Taylor's appointment, four of the board's six committees are now headed by the recruits. Mr. Parsons, who remains a member of the nomination panel, told Bloomberg in an interview that he has no plans to step down as chairman of the board. 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. CJ PRIME: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: CJ Prime Investment LLC 2650 Foothill Blvd La Crescenta, CA 91214 Bankruptcy Case No.: 10-29694 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Central District Of California (Los Angeles) Judge: Sheri Bluebond Debtor's Counsel: Yoonju Kim, Esq. 3600 Wilshire Blvd Ste 1210 Los Angeles, CA 90010 Tel: (213) 381-6100 Fax: (213) 381-6166 E-mail: yoonk@kchonglaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Connie Kim Hur, managing member. COEUR D'ALENE: Exchanges $14 Million Senior Notes for Stock ----------------------------------------------------------- Coeur d'Alene Mines Corporation agreed to exchange $14,221,000 of its 3.25% Convertible Senior Notes due 2028 for shares of its common stock, par value $0.01. In connection with such agreements, the Company will: * on or about May 10, 2010, issue 285,602 shares of Common Stock; and * on or about May 21, 2010, issue a number of shares of Common Stock equal to (a) $9,500,000, divided by (b) the arithmetic mean of the two lowest daily volume-weighted average prices of the Company's Common Stock during the ten consecutive trading days commencing May 7, 2010. The Company will issue the shares pursuant to the exemption from the registration requirements afforded by Section 3(a)(9) of the Securities Act of 1933, as amended. About Coeur d'Alene Mines Based in Coeur d'Alene, Idaho, Coeur d'Alene Mines Corporation is primarily a silver producer with a growing gold production profile. The Company is engaged, through its subsidiaries, in the operation and ownership, development and exploration of silver and gold mining properties and companies located primarily within South America (Chile, Argentina and Bolivia), Mexico (Chihuahua), United States (Nevada and Alaska) and Australia (New South Wales). At December 31, 2009, the Company had total assets of $3,054,035,000 against total current liabilities of $188,608,000 and total non-current liabilities of $872,222,000, resulting in stockholders' equity of $1,993,205,000. * * * As reported by the Troubled Company Reporter on August 11, 2009, Standard & Poor's Ratings Services raised its corporate credit rating on Coeur D'Alene Mines to 'B-' from 'CCC' and raised the ratings on the Company's US$180 million senior unsecured notes due 2024 (US$106 million outstanding) and US$230 million senior unsecured notes due 2028 (US$150 million outstanding) to 'CCC+' from 'CCC-'. In January 2010, S&P withdrew its ratings on the Company, including its 'B-' corporate credit rating, at the Company's request. COMFORCE CORP: Post $576,000 Net Income for March 28 Quarter ------------------------------------------------------------ COMFORCE Corporation filed with the Securities and Exchange Commission its Form 10-Q for the quarterly period ended March 28, 2010. The Company's balance sheet at March 28, 2010, showed $166.3 million in total assets and $181.1 million in total liabilities, for a stockholders' deficit of $14.78 million. The Company reported a net income of $576,000 on $143.8 million of net sales for the three months ended March 28, 2010, compared with a net income of $156,000 on $138.0 million of net sale during the same period in 2009. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6200 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. * * * As of Dec. 27, 2009, the Company's balance sheet showed total assets of $165.2 million and liabilities of $180.7 million for a $15.4 million total stockholders' deficit. COMMERCIAL BANK: Fitch Affirms IDR at 'B' with Negative Outlook --------------------------------------------------------------- Fitch Ratings has affirmed Commercial Bank of Africa's (CBA) ratings at Long-term Issuer Default (IDR) 'B' with a Negative Outlook, Short-term IDR 'B', Individual 'D', Support '5' and Support Rating Floor 'NF'. Simultaneously, the agency has withdrawn CBA's ratings and will no longer provide rating coverage for this issuer. COMMERCIAL VEHICLE: Posts $676,000 Profit for First Quarter ----------------------------------------------------------- Commercial Vehicle Group Inc. reported $676,000 of net income on $146.4 million of revenues for the three months ended March 31, 2010, compared with a net loss of $19.4 million on $108.5 million of revenues during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $276.8 million in total assets and $287.5 million in total liabilities for a total stockholders' deficit of $10.7 million. Operating income for the first quarter of 2010 was $3.6 million compared to an operating loss of $18.4 million for the first quarter of 2009. Net income was $0.7 million for the quarter, or $0.03 per diluted share, compared to a net loss of $19.4 million in the prior-year quarter. Fully diluted shares outstanding for the quarter were 23.8 million compared to 21.7 million for the prior-year period. "We are very pleased with our first quarter 2010 performance, both from an operational and financial standpoint," said Mervin Dunn, President and Chief Executive Officer of Commercial Vehicle Group. "Our cost reduction efforts, as well as our focus on top line growth and maintaining our variable cost structure, have again proven to be extremely beneficial as we see signs our end markets may be starting to recover," added Mr. Dunn. Revenues for the quarter compared to the prior-year period increased by approximately $37.9 million due primarily to an increase in the Company's global heavy truck, construction and military end markets. The Company reported a cash balance of $25.3 million as of March 31, 2010 and had zero funds borrowed under its revolving credit facility. Capital expenditures for the first quarter were $0.7 million, or 0.5% of revenues. In addition, the Company has received its previously announced tax refund in the amount of $21.4 million early in the second quarter of 2010. "Our financial achievements through this first quarter of 2010 are extremely positive. When compared to the same period last year, our operating income improved $22.0 million on $37.9 million of incremental revenues, which is a testament to the cost cutting and margin improvement plans we have targeted over the last 12 to 18 months," said Chad M. Utrup, Chief Financial Officer of Commercial Vehicle Group. "This improvement, combined with the success of our equity offering during this past quarter and the receipt of our tax refund, has provided us with a much more flexible capital structure as we move forward," added Mr. Utrup. The Company is not providing revenue or earnings estimates; however, it does not expect to be required to comply with any financial covenant requirements for the full year 2010 at this time. A full-text copy of the Company's earnings release is available for free at http://ResearchArchives.com/t/s?6203 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 at December 31, 2009, showed $250.5 million in total assets and $288.2 million in total liabilities, resulting in 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. COPPER KING: Suspends Mining Operations --------------------------------------- Copper King Mining Corp. filed a Chapter 11 petition on May 18 in Reno, Nevada (Bankr. D. Nev. Case No. 10-51912). Subsidiary Western Utah Copper Co. also filed for Chapter 11 in Nevada (Case No. 10-51913). The Debtors own a mine and mill in Milford, Utah. Copper King Mining Corp. operates a $60 million copper mill just outside of Milford in Beaver County. The Salt Lake Tribune reports that Copper King is seeking to reorganize its debts and bring in more capital to allow it to emerge from bankruptcy. According to Salt Lake Tribune, the company notified shareholders that it had suspended copper mining and milling operations. Among problems detailed: * The process used to extract copper, gold and silver from the ore taken from the company's Hidden Treasure Mine was uneconomical. * Copper King had run into problems with the way it had handled its mill tailings -- the material left over after the metals were extracted from the ore -- and needed to get into compliance with state and federal environmental regulations. * And, the company had defaulted on an agreement to supply magnetite ore to its customers and was unable to fulfill that obligation, worth more than $10 million. D&P MARKET PLACE: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: D&P Market Place LLC dba The Iron Tomato 57 Mamaroneck Avenue White Plains, NY 10601 Bankruptcy Case No.: 10-22972 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court Southern District of New York (White Plains) Judge: Robert D. Drain Debtor's Counsel: Jonathan S. Pasternak, Esq. E-mail: jsp@rattetlaw.com Julie A. Cvek, Esq. E-mail: jcvek@rattetlaw.com Rattet, Pasternak & Gordon Oliver, LLP 550 Mamaroneck Avenue, Suite 510 Harrison, NY 10528 Tel: (914) 381-7400 Fax: (914) 381-7406 Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Suzanne Demeo, member. DANIEL GONSIOR: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Joint Debtors: Daniel Anthony Gonsior Lynne Kathleen Gonsior 4917 Poppy Lane Edina, MN 55435 Bankruptcy Case No.: 10-43694 Chapter 11 Petition Date: May 17, 2010 Court: US Bankruptcy Court District of Minnesota (Minneapolis) Judge: Robert J. Kressel Debtor's Counsel: Jamie R. Pierce, Esq. Hinshaw & Culbertson LLP 333 South Seventh Street, Suite 2000 Minneapolis, MN 55402 Tel: (612) 333-3434 E-mail: jpierce@hinshawlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Joint Debtors say that assets total $3,465,042 while debts total $4,881,077. A copy of the Joint Debtors' list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mnb10-43694.pdf The petition was signed by the Joint Debtors. DAVID ROSEN: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: David B. Rosen 20744 Quedo Drive Woodland Hills, CA 91364 Bankruptcy Case No.: 10-15822 Chapter 11 Petition Date: May 16, 2010 Court: United States Bankruptcy Court Central District Of California (San Fernando Valley) Judge: Maureen Tighe Debtor's Counsel: Louis J. Esbin, Esq. 27201 Tourney Rd Ste 122 Valencia, CA 91355-1804 Tel: (661) 254-5050 Fax: (661) 254-5252 E-mail: Esbinlaw@sbcglobal.net Scheduled Assets: $1,117,696 Scheduled Debts: $1,228,827 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-15822.pdf The petition was signed by David B. Rosen. DEEP MARINE: Oceaneering International Bids for DMT Sapphire ------------------------------------------------------------ Oceaneering International, Inc. was the high bidder to acquire the DMT Sapphire from an affiliate of Deep Marine Technology, Inc. (DMT), under a bankruptcy-sponsored auction proceeding. The bid was $16.5 million. A bankruptcy court hearing to approve the sale of this Class 2 dynamically positioned vessel is scheduled for June 2, 2010. The U.S. flagged and built DMT Sapphire was commissioned in 2002, is 237 feet long, and will be delivered to Oceaneering at a Louisiana shipyard. Oceaneering intends to make an additional investment to upgrade the DMT Sapphire. The vessel will have an Oceaneering saturation (SAT) diving system permanently installed onboard and be outfitted with a new crane and telecommunications, video, and survey equipment. It will be renamed at a later date. T. Jay Collins, President and Chief Executive Officer, stated, "Our Subsea Projects business has performed admirably for the past five years and created an excellent reputation for SAT diving service work in the Gulf of Mexico. This pending acquisition is consistent with our intent to augment our vessel fleet by purchasing quality assets at attractive prices. "Assuming the court approves our bid, the addition of the DMT Sapphire should be accretive to our earnings in 2011." In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, Oceaneering International, Inc. cautions that statements in this press release which are forward-looking involve risks and uncertainties that may impact Oceaneering's actual results. The forward-looking statements in this press release concern Oceaneering's: intent to accept delivery of the DMT Sapphire at a Louisiana shipyard; intent to make an additional investment to upgrade the DMT Sapphire with the permanent installation onboard of an Oceaneering SAT diving system, a new crane, and telecommunications, video, and survey equipment; intent to rename the vessel at a later date; and projection that the addition of the DMT Sapphire should be accretive to earnings in 2011. Although Oceaneering's management believes that the expectations reflected in these forward-looking statements are reasonable, Oceaneering can give no assurance that the expectations will prove to have been correct. The statements are made based on various underlying assumptions and are subject to numerous uncertainties and risks. If one or more of these risks materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those expected. For a more complete discussion of these and other risk factors, please see Oceaneering's annual report on Form 10-K for the year ended December 31, 2009 and subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. Oceaneering is a global oilfield provider of engineered services and products primarily to the offshore oil and gas industry, with a focus on deepwater applications. Through the use of its applied technology expertise, Oceaneering also serves the defense and aerospace industries. About Deep Marine headquartered in Houston, Texas, Deep Marine Technology -- http://www.deepmarinetech.com/-- is an independent subsea service provider to the Offshore Oil and Gas Industry. Deep Marine Holdings, Inc., filed for chapter 11 bankruptcy protection (Case No. 09-39314) on December 4, 2009, before the United States Bankruptcy Court for the Southern District of Texas in Houston. Affiliates Deep Marine Technology Inc., Deep Marine 1, LLC, Deep Marine 2, LLC, Deep Marine 3, LLC, and Deep 4 Marine, LLC, also sought bankruptcy protection. The Debtors are represented by Bracewell & Guiliani, L.L.P. The Debtors disclosed $100,000,001 to $500,000,000 in total assets. DELTA MUTUAL: Board OKs 5-Year Employment Pacts with CEO and EVP ---------------------------------------------------------------- Delta Mutual's Board of Directors approved five-year term executive employment agreements between the Company and Dr. Daniel R. Peralta, Chairman and Chief Executive Officer, and Malcolm W. Sherman, Executive Vice President, effective March 22, 2010 and March 23, 2010, respectively. Dr. Peralta's Employment Agreement provides for a fixed annual salary of $500,000; Mr. Sherman's Employment Agreement provides for a fixed annual salary of $350,000. Under the Employment Agreements, both executives are eligible for participation in a bonus pool with other senior executives. For the second year of the term of each Employment Agreement the bonus shall be computed with reference to increases over the corresponding quarterly profit for the year 2006, based on the quarterly reports of the Company for the year 2006; for the third year, the bonus shall be based on the financial performances detailed in the quarterly reports for the year 2007; and for the fourth year of the Employment Agreements, the bonus shall be based on the quarterly reports for the year 2008, and shall continue for the quarterly filings for the year 2009 and each subsequent year during the respective terms of each of the Employment Agreements. The bonuses will be pooled with those of other senior executives and be computed based on a total bonus pool equal to 15% of the net profits of the Company as set forth in the Company's SEC filings. About Delta Mutual Delta Mutual, Inc., invests in oil and gas properties in South America. It intends to focus its investments in the energy sector, including development of energy producing investments and alternative energy production in Latin America and North America. At December 31, 2009, the Company had total assets of $1,750,005 against total liabilities, all current, of $1,206,826, resulting in stockholders' equity of $543,179. At December 31, 2008, the Company had stockholders' deficit of $645,912. During the fiscal year ended December 31, 2009, the Company had a gain from continuing operations of $850,000. The Company has an accumulated deficit of $3,580,837 and working capital deficiency of $967,042 as of December 31, 2009. The Company said it may require additional funding to execute its strategic business plan for 2010. In its April 15, 2010 report, Jewett, Schwartz, Wolfe & Associates in Hollywood, Florida, raised substantial doubt about the Company's ability to continue as a going concern. The auditor pointed to the Company's accumulated deficit and working capital deficiency. The auditor also said the Company is not generating sufficient cash flows to meet its regular working capital requirements. DIAMANTE ROSE: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Diamante Rose, Limited Liability Company 4035 S. El Capitan Way Las Vegas, NV 89147 Bankruptcy Case No.: 10-18989 Chapter 11 Petition Date: May 16, 2010 Court: U.S. Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: Spencer M. Judd, Esq. Macdonald & Judd 6625 W. Sahara, Suite 1 Las Vegas, NV 89146 Tel: (702) 870-1771 Fax: (702) 869-0683 E-mail: spencer@jsmjlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company says that assets total $2,500,000 while debts total $1,350,000. The list of unsecured creditors filed together with its petition does not contain any entries. The petition was signed by William Gayler, manager. DUNE ENERGY: UBS AG Holds 21.78% of Common Stock ------------------------------------------------ UBS AG said it may be deemed to beneficially own 10,935,008 shares or roughly 21.78% of the common stock of Dune Energy Inc. as of May 6, 2010. UBS said the number of Common Shares beneficially owned consists of 9,729,476 Common Shares underlying 10% Senior Redeemable Convertible Preferred Stock and 1,205,532 Common Shares. As May 6, 2010 each share of Preferred Stock converts into 114.29 Common. The make whole premium on the Preferred shares has expired as of record date April 2, 2010. About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company's balance sheet as of December 31, 2009, showed $372.6 million in assets, $372.9 million of debts, and $184.8 million in redeemable convertible preferred stock, for a stockholders' deficit of $185.1 million. Standard & Poor's Ratings Services revised its recovery rating on Dune Energy Inc.'s $300 million second-lien notes upon updated reserve information. S&P has revised the rating to '4', indicating its expectation for average (30%-50%) recovery in the event of a payment default, from '3'. The issue-level rating of 'CCC-' on these notes remains unchanged. DUNE ENERGY: Post $7.9 Million Net Loss for 1st Quarter 2010 ------------------------------------------------------------ Dune Energy Inc. reported results for the first quarter of 2010. Net loss totaled $7.9 million for the first quarter of 2010, and $12.1 million for the first quarter of 2009. Preferred stock dividends were $6.4 million in the first quarter of 2009 versus $8.9 million in the first quarter of 2008. Net loss per share, both basic and fully diluted, for the quarter was $0.36, based on 40.2 million weighted average shares outstanding as compared with a loss of $1.03 per share in the first quarter of 2009 with 20.2 million weighted average shares outstanding. The increased outstanding common shares are associated with the conversion of Preferred shares into common shares and reflect a 1 for 5 reverse split completed in December of 2009. The Company's balance sheet at March 31, 2010, showed $369.1 million in total assets, $188.6 million redeemable convertible preferred stock, and $376.5 million in total liabilities, for a $196.1 million stockholders' deficit. Revenue for the first quarter totaled $20.3 million as compared with $14.3 million for the first quarter of 2009. Production volumes in the first quarter were 180 Mbbls of oil and 1.17 Bcf of natural gas, or 2.3 Bcfe. This compares with 198 Mbbls of oil and 1.18 Bcf of natural gas, or 2.4 Bcfe for the first quarter of 2009. In the first quarter of 2010, the average sales price per barrel of oil was $76.24, and $5.57 per mcf for natural gas, as compared with $39.86 per barrel and $5.43 per mcf, respectively for the first quarter of 2009. T he primary reasons behind the increase in revenue were higher average sales prices in the first quarter of 2010 versus the first quarter of 2009. Total lease operating expense for the first quarter totaled $8.5 million versus $7.0 million for the first quarter of 2009. Approximately $347,000 of this increase was associated with a prior year adjustment, $400,000 was associated with increased salt water disposal costs in one field and $300,000 was associated with increased production and resultant expenses at our Chocolate Bayou Field. Cash G&A expense totaled $2.6 million for the first quarter of 2009 versus $3.4 million for the first quarter of 2008. The $0.8 million decrease reflects a continued focus on cost controls. Interest financing expense was $8.9 million for the first quarter of 2010 versus the $8.7 million of 2009, primarily associated with payment of 10.5% interest on the $300 million of Senior Secured Notes. The company incurred a gain of $1.3 million on hedging during the first quarter of 2010 versus a $2.8 million gain in the first quarter of 2009. The company amended its revolver with Wells Fargo Foothill on March 23, 2010 extending the maturity to March 31, 2011. Current availability under the revolver is $40 million subject to several covenants regarding EBITDA, production, capital and payables. At the end of the quarter $24 million was drawn on the revolver and $8.5 million of letters of credit were outstanding. Cash at the end of the quarter was $20.1 million resulting in liquidity of $27.6 million. James A. Watt, President and Chief Executive Officer stated, "Our recent release detailed the potential of the Chocolate Bayou field and our Garden Island Bay deep subsalt prospect. With deals coming together for these prospects, there is visibility for the upside potential of our asset base. In order to manage liquidity we will seek industry partners on a promoted basis to participate in high potential drilling opportunities and may monetize certain non-core assets. The resultant improved liquidity along with the expiration of the make whole on the Preferred shares should allow value to accrue to all stake holders assuming success in our drilling programs." A full-text copy of the Company's earnings release is available for free at http://ResearchArchives.com/t/s?61fe About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company's balance sheet as of December 31, 2009, showed $372.6 million in assets, $372.9 million of debts, and $184.8 million in redeemable convertible preferred stock, for a stockholders' deficit of $185.1 million. Standard & Poor's Ratings Services revised its recovery rating on Dune Energy Inc.'s $300 million second-lien notes upon updated reserve information. S&P has revised the rating to '4', indicating its expectation for average (30%-50%) recovery in the event of a payment default, from '3'. The issue-level rating of 'CCC-' on these notes remains unchanged. EAGLE AUTO: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Eagle Auto, Inc. dba Boswell's Auto Service 6133 Covered Bridge Road Burke, VA 22015 Bankruptcy Case No.: 10-21068 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court District of Maryland (Greenbelt) Judge: Wendelin I. Lipp Debtor's Counsel: Michael G. Wolff, Esq. 15245 Shady Grove Road, Suite 465 North Lobby Rockville, MD 20850 Tel: (301) 984-6266 Fax: (301) 816-0592 E-mail: smalinowski@gwolaw.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company says that assets total $819,673 while debts total $1,944,964. A copy of the Company's list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mdb10-21068.pdf The petition was signed by Samer AlShantir, president. EINSTEIN NOAH: Posts $620 Million Net Income for March 30 Quarter ----------------------------------------------------------------- Einstein Noah Restaurant Group filed with the Securities and Exchange Commission its Form 10-Q for the quarterly period ended March 30, 2010. The company reported net income of $620,000 on $100.8 million of total revenue for the 13 weeks ended March 30, 2010, compared with $1.85 million net income on $100.4 million of total revenue during the 13 weeks ended March 31, 2009. The Company's balance sheet at March 30, 2010, showed $211.5 million total assets and $137.2 million total liabilities, for a $63.7 million stockholders' equity. Accumulated deficit has reached $202.7 million as of March 30. A full-text copy of the company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?6202 About Einstein Noah Restaurant Group Based in Lakewood, Colorado, Einstein Noah Restaurant Group Inc. (Nasdaq: BAGL) -- http://www.einsteinnoah.com/-- operates a a retail chain of quick casual restaurants in the United States, specializing in foods for breakfast and lunch. The Company operates locations primarily under the Einstein Bros.(R) Bagels and Noah's New York Bagels(R) brands and primarily franchises locations under the Manhattan Bage(R) brand. The Company's retail system consists of more than 600 restaurants, including more than 100 license locations, in 35 states plus the District of Columbia. As of September 29, 2009, Einstein Noah had total assets of $213,792,000 against $155,494,000 in total liabilities. The September 29 balance sheet showed strained liquidity: the Company had $36,262,000 in total current assets against $69,956,000 in total current liabilities. EXTENDED STAY: Starwood Submits Competing Bid; Auction on May 27 ---------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Extended Stay Inc. confirmed that Starwood Capital Group LLC made a preliminary bid by the deadline to top the stalking horse offer from Centerbridge Partners LP and Paulson & Co. With another bid, Extended Stay hopes for a successful auction on May 27 where the winner will acquire Extended Stay under a Chapter 11 plan. Extended Stay scheduled a June 17 hearing for approval of the disclosure statement describing the reorganization plan reflecting the outcome of the May 27 auction. Extended Stay hopes for a confirmation hearing of the plan by July 20. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). FIDELITY NATIONAL: Fitch Puts 'BB+' IDR on Watch Negative --------------------------------------------------------- Following Fidelity National Information Services, Inc.'s (FIS) announcement of its decision to pursue a leveraged recapitalization, Fitch Ratings has placed the following ratings of FIS on Rating Watch Negative: --Issuer Default Rating (IDR) 'BB+'; --$900 million secured revolving credit facility (RCF) 'BBB-'; and --Senior secured term loan A 'BBB-'. Fitch has also placed on Rating Watch Negative the following ratings for Metavante Technologies Inc. (Metavante): --IDR 'BB+'; and --$800 million senior secured term loan B 'BBB-'. FIS previously announced that its board of directors had formed a special committee to evaluate two potential strategic alternatives, including a leveraged buyout as well as a leveraged recapitalization of the company and share repurchase program. Subsequently, FIS announced that discussions regarding a leveraged buyout had ended and that the company has decided to pursue a substantial debt financed share repurchase. Total liquidity as of March 31, 2010, was $1.2 billion consisting principally of $561 million available under FIS' $900 million senior secured revolving credit facility expiring January 2012, approximately $464 million in cash and $145 million available on an asset-backed securitization program expiring November 2013. Total debt as of March 31, 2010 was $3.1 billion and consisted principally of $1.8 billion outstanding under a senior secured term loan A issued at FIS and maturing January 2012; $339 million drawn on FIS' senior secured revolving credit facility; $50 million outstanding under a senior secured term loan C maturing January 2012 and $793 million remaining under Metavante's senior secured term loan B maturing November 2014. FORTUNE INDUSTRIES: Julia Reed Steps Down From Board ---------------------------------------------------- Julia Reed on May 7, 2010, resigned from Fortune Industries, Inc.'s Board of Directors and from the Company's Audit Committee. Ms. Reed's resignation was not due to a disagreement with the Company on any matter relating to the Company's operations, policies or practices. About Fortune Industries Fortune Industries, Inc., is a holding company of providers of full service human resources outsourcing services through co- employment relationships with their clients. Going Concern Doubt Somerset CPAs, P.C., in Indianapolis, Indiana, expressed substantial doubt about Fortune Industries, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for fiscal periods ended June 30, 2009, Aug. 31, 2008, and 2007. The auditor noted that the Company has had recurring losses from operations and has a net capital deficiency. FORTUNE INDUSTRIES: Reports $176,000 Net Loss for March 31 Qtr -------------------------------------------------------------- Fortune Industries, Inc. said net loss available to common shareholders was $176,000 for the three months ended March 31, 2010. For the nine months ended March 31, 2010, the Company reported net income available to common shareholders of $670,000. Total revenues were $15,319,000 for the three months ended March 31, 2010, and $45,133,000 for the nine months ended March 31, 2010. At March 31, 2010, the Company had total assets of $29,817,000 against total liabilities of $10,365,000. Effective November 30, 2008, the Company completed a transaction to sell all of the outstanding shares of common stock of the following wholly-owned subsidiaries: James H Drew Corporation, Nor-Cote International, Inc., Fortune Wireless, Inc. and Commercial Solutions, Inc. The subsidiaries were sold to related party entities owned by the Company's majority shareholders in exchange for a $10,000,000 reduction in the outstanding balance of the term loan note due to the majority shareholder and a three- year term note in the amount of $3,240,000. The transaction also included the conversion of the remaining term loan note balance to Preferred Stock and the issuance of additional warrants. The Company did not recognize any gain from the sale as the consideration paid by the two largest shareholders as it was equal to the net book value of the sold subsidiaries. Effective November 30, 2008, the Company no longer operated in the Wireless Infrastructure, Transportation Infrastructure, Ultraviolet Technologies and Electronics Integration Segments. Effective December 1, 2008, the Company devoted substantially all its resources on the growth and profitability of the Business Solutions segment. According to the Company, by selling the subsidiaries in four segments that overall have been underperforming and require a higher level of working capital investment, its management believes they will be able to start generating positive cash flows immediately. The conversion of the outstanding debt to preferred stock by the Company's majority shareholder will also result in a significant decrease in the debt service requirements in 2010. With the Company's human capital and financial resources all focusing on the profitability of a segment that historically has generated operating income and positive cash flows from operations, management believes the Company will have adequate cash to fund anticipated needs through June 30, 2010. On April 30, 2010, the Company entered into a $1 million term note with a bank. The term note requires 24 consecutive monthly payments of principal plus accrued interest at the Bank's Prime Rate (not less than 4.5% per annum). The term note matures on April 30, 2012. The term note is secured by all assets of the Company and the personal guarantee of the Company's majority shareholder. The note is subject to certain covenants including minimum cash flow coverage and current ratio requirements. A full-text copy of the Company's Form 10-Q is available at no charge at http://ResearchArchives.com/t/s?62aa About Fortune Industries Fortune Industries, Inc., is a holding company of providers of full service human resources outsourcing services through co- employment relationships with their clients. Going Concern Doubt Somerset CPAs, P.C., in Indianapolis, Indiana, expressed substantial doubt about Fortune Industries, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for fiscal periods ended June 30, 2009, Aug. 31, 2008, and 2007. The auditor noted that the Company has had recurring losses from operations and has a net capital deficiency. GENTA INC: Senior VP & COO Lloyd Sanders Steps Down --------------------------------------------------- W. Lloyd Sanders, senior vice-president and chief operating officer of Genta Incorporated, resigned from the Company, effective May 7, 2010, to pursue other interests. The Board of Directors of the Company accepted Mr. Sanders's notice of resignation from his position, effective May 7, 2010. The Company says that Mr. Sanders' resignation was not the result of any disagreement with the Company. Mr. Sanders had served as the Company's Senior Vice-President and Chief Operating Officer since March 2008 and had been Senior Vice-President, Commercial Operations since October 2006. On May 7, 2010, the Board of Directors named Gary Siegel, Vice President, Finance, the Company's Principal Financial Officer, Principal Accounting Officer, and Secretary to the Board of Directors. Mr. Siegel had been appointed to these positions on an interim basis in February 2008. In recognition of this change, the Compensation Committee of the Company approved an increase in Mr. Siegel's annual salary from $210,000 to $250,000. The Compensation Committee also agreed to guarantee the payment of Mr. Siegel's annual bonus target for 2010, previously established at 25.0% of his annual salary, or $62,500.00 and payable in January 2011, as long as Mr. Siegel is still employed by the Company on December 31, 2010. About Genta Berkeley Heights, New Jersey, Genta Incorporated (OTCBB: GETA.OB) -- http://www.genta.com/-- is a biopharmaceutical company with a diversified product portfolio that is focused on delivering innovative products for the treatment of patients with cancer. At December 31, 2009, the Company had total assets of $12.229 million against total current liabilities of $10.501 billion and total long-term liabilities of $4.590 million, resulting in stockholders' deficit of $2.862 million. GREEN SCENE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Green Scene, Inc. aka Green Scene Hydroseeding, Inc 3515 Stern Dr Saint Charles, IL 60174 Bankruptcy Case No.: 10-72521 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Northern District of Illinois (Rockford) Judge: Manuel Barbosa Debtor's Counsel: Richard G. Larsen, Esq. Myler, Ruddy & McTavish 105 E. Galena Blvd., 8th Floor Aurora, IL 60505 Tel: (630) 897-8475 Fax: (630) 897-8076 E-mail: rglarsen@mrmlaw.com Scheduled Assets: $533,818 Scheduled Debts: $1,944,406 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ilnb10-72521.pdf The petition was signed by Robert Dore, president. GREGORY MORRIS: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Gregory S. Morris 500 Devonshire Drive Hollidaysburg, PA 16648 Bankruptcy Case No.: 10-70574 Chapter 11 Petition Date: May 16, 2010 Court: United States Bankruptcy Court Western District of Pennsylvania (Johnstown) Debtor's Counsel: Robert O. Lampl, Esq. 960 Penn Avenue, Suite 1200 Pittsburgh, PA 15222 Tel: (412) 392-0330 Fax: (412) 392-0335 E-mail: rol@lampllaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Gregory S. Morris. Debtor's List of 9 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ S&T Bank Loans $13,789,382 P.O. Box 469 Indiana, PA 15701 Ameriserve Financial Loans $12,565,070 Bank 216 Main Street Johnstown, PA 15901 Jersey Shore Bank Loans $8,585,787 300 Market Street Williamsport, PA 17701 Jersey Shore Bank Loans $2,831,286 300 Market Street Williamsport, PA 17701 First National Bank Loans $1,855,378 4140 E. State Street Hermitage, PA 16148 Blumling & Gusky, LLP Legal Fees $400,000 Koppers Building 436 Seventh Avenue, Suite 1200 Pittsburgh, PA 15219 The Orr Group, Inc. Construction $374,773 Constructors Debt 428 Seventh Avenue P.O. Box 268 Altoona, PA 16603 County National Bank Loan $224,865 Richard Bowen Employment $200,000 GREGORY PALMER: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Gregory Palmer 11000 Hibner Road Hartland, MI 48353 Bankruptcy Case No.: 10-32813 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court Eastern District of Michigan (Flint) Judge: Daniel S. Opperman.Flint Debtor's Counsel: R. Reid Krinock, Esq. 403 E. Grand River, Suite D Brighton, MI 48116 Tel: (810) 229-5955 E-mail: rkrinock@sbcglobal.net Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of creditors together with its petition. The petition was signed by the Debtor. HEALTH MANAGEMENT: Fitch Affirms Issuer Default Rating at 'B+' -------------------------------------------------------------- Fitch Ratings has taken the following rating actions on Health Management Associates (HMA): --Issuer Default Rating (IDR) affirmed at 'B+'; --Secured bank facility upgraded to 'BB+/RR1' from 'BB/RR2'; --Senior secured notes upgraded to 'BB+/RR1' from 'BB/RR2'; --Subordinated convertible notes affirmed at 'B-/RR6'. The Rating Outlook is revised to Positive from Stable. The ratings apply to approximately $3.1 billion in debt outstanding as of March 31, 2010. As reflected by the Positive Outlook, HMA's IDR is at the high end of the 'B+' rating category. Although HMA has been exhibiting positive momentum in its operating and credit metrics since late 2008, Fitch previously commented that some important risks to the credit profile were constraining the ratings. HMA has recently made progress in addressing these two issues - limited cushion under its credit facility financial maintenance covenants, and the questionable sustainability of its improved operating trend. The remaining major obstacle before an upgrade to a 'BB' category IDR is enhanced visibility with respect to the company's cash deployment strategy, particularly as it pertains to potential hospital acquisitions. The ratings are supported by a sustained trend of improvement in HMA's operating and credit metrics since the second half of 2008 (2H'08). Fitch believes that management's operational initiatives designed to gain market share and improve profitability clearly have traction. HMA's organic patient volume growth has outpaced that of the broader for-profit hospital industry consistently since late 2008, and levels of organic revenue growth have outpaced the industry beginning in the 2H'09. Fitch is cautiously optimistic about the operating outlook for the for-profit hospital industry throughout the balance of 2010 and into 2011, supporting its moderately positive near-term operating outlook for HMA. However, there are some important operational headwinds. First, Fitch does expect that the company's industry leading levels of patient volume and organic revenue growth will be tempered in 2010 relative to the strong initial results produced by its operational improvement programs, as the company is now facing more difficult comparisons relative to its strong 2009 performance. In addition, strained macro economic conditions continue to have negative implication for patient demand and uncompensated care expense. HMA's acute care hospital facilities are centralized in Florida and Mississippi, regions where unemployment rates remain significantly elevated. However, the hospital industry is relatively non-cyclical, with the most significant factors being regulatory, not economic, changes. Despite the effects of macro economic pressures, operating and credit metrics across the for-profit hospital industry improved in 2009, mostly as a result of improved profitability due to strong commercial managed care pricing trends and constrained growth in operating expenses. In addition, the legislative passage of the Patient Protection and Affordable Care Act has removed some uncertainty surrounding the implications of regulatory reform on the industry. The legislation in its current form has positive implications for insured patient volumes and uncompensated care levels, which will be offset to some extent by increased pressure on reimbursement rates - certainly from government payors, but likely from commercial payors as well. Between now and the time the crux of the legislation takes effect in 2014, significant government regulation will have to be written, which will provide more clarity on its potential industry impacts. There was previously significant credit risk related to HMA's limited operating cushion relative to its credit facility financial covenants. Based primarily on lower debt outstanding, the EBITDA cushion relative to the covenants has improved. At March 31, 2010, HMA had a 50 basis point (bps) cushion relative to its interest coverage covenant, versus 19 bps at March 31, 2009. However, HMA's covenants continue to tighten incrementally each quarter, and so significant but not drastic declines in EBITDA would trip the covenants by year end. Based on Fitch's calculations, EBITDA would have to decline by between 15% and 20% from the second quarter 2010 to fourth quarter 2010 (2Q'10-4Q'10) versus the prior year period to trip the covenants. Based on its moderately positive operating outlook for HMA, Fitch believes that a 15% EBITDA decline is very unlikely. Also, HMA has sufficient visibility and financial flexibility to manage under its covenants by enacting contingency plans - such as asset divestitures or reducing capital expenditures - in time to avoid any violations. HMA's credit metrics have improved with debt-to-EBITDA declining to 4.3 times (x) for the latest twelve months (LTM) ended March 31, 2010 from 4.7x for the LTM ended March 31, 2009. In addition to its operational improvement initiatives, the company has recently focused on improving its credit profile through debt reduction; since early 2008 the company has used about $700 million of cash on hand for early debt retirement. A one-notch upgrade of the IDR to 'BB-' would be consistent with debt-to- EBITDA declining to around 4.0x versus the current 4.3x level. Fitch expects this would be as the result of sustained operational improvements leading to growth in EBITDA, as it does not expect the company to continue to use cash for debt reduction as it did in 2008 and 2009. HMA's credit profile is also supported by a favorable maturity schedule and ample liquidity. HMA has no meaningful debt maturities until 2014 other than its undrawn credit revolver which expires in 2013. The $2.5 billion senior secured term loan matures in February 2014 and the $400 million senior secured notes mature April 2016. Liquidity is provided by approximately $179 million of cash and marketable securities at March 31, 2010, availability on the company's $500 million senior secured revolver ($455 million available at March 31, 2010), and free cash flow ($238 million for the LTM ended March 31, 2010). In 2010, Fitch expects free cash flow (defined as cash from operations less dividends and capital expenditures) to remain relatively consistent with current levels. Fitch expects that HMA's use of free cash flow will be less conservative in 2010 than it was in 2009, when it used $156 million of cash on hand for debt reduction. Specifically, HMA has indicated that it is targeting 2-3 hospital acquisitions in 2010. HMA did complete one hospital acquisition in 2009, using cash on hand to purchase Sparks' Health Center in Fort Smith, AR for $138 million, equal to about 55% of Sparks' LTM revenue. If HMA continues to fund acquisitions primarily through cash on hand, as opposed to debt funding, the company's growth through acquisition strategy would not be inconsistent with a 'BB-' IDR. However, if the company decides to use debt to fund acquisitions, resulting in leverage sustained above 4.0x, the credit profile will remain more consistent with a 'B+' IDR. The Recovery Ratings and notching reflect Fitch's recovery expectations under a distressed scenario. The 'BB+/RR1' rating for the secured debt reflects Fitch's expectations for recovery at the low end of the 91%-100% range under a bankruptcy scenario. HMA's recovery ratings reflect Fitch's expectation that the enterprise value of the company, and hence, recovery rates for its creditors, will be maximized in a restructuring scenario (going concern), rather than a liquidation. The secured debt was upgraded based on better recovery prospects in this scenario due to improved profitability and a lower debt balance. HEALTH NET: S&P Upgrades Counterparty Credit Rating to 'BB' ----------------------------------------------------------- Standard & Poor's Ratings Services raised its counterparty credit rating on Health Net Inc. (NYSE:HNT) to 'BB' from 'BB-'. At the same time, S&P removed the rating from CreditWatch, where it had been placed with positive implications on May 7, 2010. S&P said, "Standard & Poor's also affirmed its 'BBB-' counterparty credit and financial strength ratings on Health Net's core operating companies--Health Net of California Inc. and Health Net Life Insurance Co. In addition, we affirmed our 'BB+' counterparty credit and financial strength ratings on Health Net of Arizona Inc., whose status we revised to strategically important from nonstrategically important under our group methodology." "The rating actions reflect our analysis of the estimated impact of the new TRICARE North Region contract on Health Net's consolidated revenues, earnings, and unregulated cash flows relative to the old contract," said Standard & Poor's credit analyst Neal Freedman. "We concluded that although the unregulated cash flows to the holding company will be lower under the new contract, they will remain meaningful. Therefore, we raised our rating on Health Net Inc. by one notch." "The counterparty credit and financial strength ratings on Health Net and its core operating companies, Health Net of California and Health Net Life Insurance, reflect their well-established competitive position in their core California market, meaningful earnings and cash flow diversity from affiliated subsidiaries' government contracts, and conservative parent company debt leverage," said Mr. Freedman. "Our concerns regarding Health Net's operating performance deterioration and the company's limited geographic and product scope somewhat offset these positive factors." S&P related, "In addition, we revised the status of Health Net of Arizona to strategically important from nonstrategically important under our group methodology based on the parent company's new strategy as a Western region health insurer following its December 2009 sale of Health Net of the Northeast Inc.'s licensed subsidiaries." HELLER EHRMAN: Plan Confirmation Hearing Set for July 6 ------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Heller Ehrman LLC will seek approval of its liquidating Chapter 11 plan at a confirmation hearing scheduled for July 6. It obtained approval of the explanatory disclosure statement last week. According to the report, the disclosure statement said unsecured claims are expected to total $95 million and $155 million. Because of the number of variables, including recoveries in lawsuits, the firm didn't guess how much unsecured creditors may recover under the plan. Bloomberg relates that creditors of the firm, which once had 730 attorneys, are suing Bank of America NA to recover $58 million paid to the lender before and after bankruptcy, saying the bank had a defective lien. According to the disclosure statement, victory in the suit will generate $60 million while the pool of unsecured claims will increase by the amount the bank pays. Heller Ehrman, according to Bloomberg, is projected to have $13.1 million cash on hand when the plan is confirmed. To exit Chapter 11, $11.5 million must be paid to priority creditors, such as the professionals who worked on the case. Among the funds needed, $3 million will come from a loan provided by six former partners. About Heller Ehrman, LLP Headquartered in San Francisco, California, Heller Ehrman, LLP -- http://www.hewm.com/-- was an international law firm of more than 730 attorneys in 15 offices in the United States, Europe, and Asia. The firm filed a voluntary petition under Chapter 11 of the Bankruptcy Code on December 28, 2008 (Bankr. N.D. Calif., Case No. 08-32514). Members of the firm's dissolution committee led by Peter J. Benvenutti approved a plan dated September 26, 2008, to dissolve the firm. The Hon. Dennis Montali presides over the case. John D. Fiero, Esq., and Miriam Khatiblou, Esq., at Pachulski, Stang, Ziehl, Young and Jones, represent the Debtors as counsel. Thomas A. Willoughby, Esq., at Felderstein Fitzgerald Willoughby & Pascuzzi LLP, represents the official committee of unsecured creditors of the Debtor. The firm listed assets and debts between $50 million and $100 million each in its bankruptcy petition. According to reports, the firm still has roughly $63 million in assets and 54 employees at the time of its filing. IAP WORLWIDE: S&P Upgrades Junk Corprate Credit Rating to 'B-' -------------------------------------------------------------- Standard & Poor's Ratings Services raised the ratings on Cape Canaveral, Fla.-based IAP Worldwide Services Inc., including the corporate credit rating, to 'B-' from 'CCC+'. At the same time, S&P assigned a 'B-' rating and a recovery rating of '3' to the $34.1 million portion of IAP's revolving credit facility that was extended to Dec. 31, 2012. "The rating actions reflect IAP's improved operating results that reduce the risk of a covenant violation and the company's adequate overall liquidity," said Standard & Poor's credit analyst Dan Picciotto. IAP provides contingency operations, facilities management, and technical services to the U.S. military and civilian agencies and has more than $1.1 billion in revenues. S&P said, "IAP was able to improve its operating margin and generate good free cash flow in 2009, a portion of which it used to repay first-lien term loans in March 2010. If business trends remain favorable such that credit measures do not deteriorate from recent levels, we could raise the ratings." "The outlook is positive. If IAP can sustain its recently improved operating performance and its liquidity remains adequate, we could raise the ratings. For instance, we could raise the ratings if IAP can maintain debt to EBITDA of around 5x and FFO to total debt of about 10%. We could revise the outlook to stable if IAP does not maintain improved operating performance. For instance, if debt to EBITDA approaches 6x, we could revise the outlook to stable," S&P noted IE ROLLERSPORTS: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: IE Rollersports, Inc. dba Cal Skate GT dba California Skate Grand Terrace dba Skaters Brothers.Com dba Skate Industries 22080 Commerce Way Grand Terrace, CA 92313 Bankruptcy Case No.: 10-24823 Chapter 11 Petition Date: May 15, 2010 Court: United States Bankruptcy Court Central District Of California (Riverside) Judge: Thomas B. Donovan Debtor's Counsel: Andrew S. Bisom, Esq. Law Offices of Andrew S Bisom 695 Town Center Dr, Suite 700 Costa Mesa, CA 92626 Tel: (714) 384-6440 Fax: (714) 384-6441 E-mail: abisom@bisomlaw.com Scheduled Assets: $2,031,900 Scheduled Debts: $2,702,401 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-24823.pdf The petition was signed by Stanford Arden Carlsen, general manager. INC 439: Case Summary & 21 Largest Unsecured Creditors ------------------------------------------------------ Debtor: Inc 439 Federal Road aka The Dive Shop 439 Federal Road Brookfield, CT 06804 Tel: (860) 354-8258 Bankruptcy Case No.: 10-51117 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court District of Connecticut (Bridgeport) Judge: Alan H.W. Shiff Debtor's Counsel: Joseph J. D'Agostino, Jr., Esq. 1062 Barnes Road Suite 304 Wallingford, CT 06492 Tel: (203) 265-5222 Fax: (203) 265-5236 E-mail: joseph@lawjjd.com Scheduled Assets: $3,028,500 Scheduled Debts: $3,777,897 A list of the Company's 21 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ctb10-51117.pdf The petition was signed by Gary Gordon, officer. INT'L LEASE FINANCE: Appoints Henri Courpron as President & CEO --------------------------------------------------------------- American International Group, Inc., and International Lease Finance Corporation said aviation industry veteran Henri Courpron has joined ILFC as President and Chief Executive Officer. Mr. Courpron, 47, succeeds ILFC Vice Chairman Alan Lund, who has served as interim ILFC President and CEO since March. Mr. Courpron will be based in ILFC's Los Angeles headquarters. "Henri Courpron, one of the aviation industry's most experienced leaders, is joining the ILFC team at a very exciting time," said Robert H. Benmosche, AIG President and CEO. "ILFC, the leading franchise in the aircraft leasing arena, is clearly positioned for the future, and we are greatly looking forward to Henri's leadership as we continue to extend ILFC's position as the industry's pre-eminent competitor. "ILFC has established real momentum over the last several months," Mr. Benmosche said. "Having stabilized the company's financial position, ILFC is now ready to begin growing its fleet. We have reiterated our commitment and the depth of our resources available to our customers across the industry, and the financial markets have demonstrated their confidence in the ILFC team and franchise. As is well-known, ILFC has raised more than $8 billion in liquidity from new debt, bank debt maturity extensions, and aircraft sales. "I'd like to personally thank Alan Lund for his leadership and dedication," Mr. Benmosche said. "Much of the credit for the dramatic improvement in ILFC's financial position belongs with Alan, and we are delighted that he has agreed to remain during the transition. Alan is a true partner." "Henri is well-known in the aviation industry for his customer focus, and ILFC and its customers will benefit from that as we remain committed to ILFC's position as a strong, enduring franchise," said Douglas M. Steenland, chairman of ILFC's Board and a member of the AIG Board of Directors. Henri Courpron began his aviation career in 1987 with Aerospatiale + Airbus-France, where he held management positions in procurement and sales before moving to Airbus-North America to serve from 1992 to 2005 in various executive positions, including President and CEO of Airbus North America Holdings. He returned to France where he served until 2007 as Airbus Executive Vice President -- Procurement. He joins ILFC from the Seabury Group, an advisory and investment banking firm in aviation and aerospace based in New York and Toulouse, France, where he was President. * * * The Wall Street Journal's Daniel Michaels and Serena Ng report that Mr. Courpron said he was approached for the ILFC top job by Douglas Steenland, an AIG director and former CEO of Northwest Airlines who became ILFC's nonexecutive chairman in late 2009. The report notes the two have known each other since Mr. Courpron was an Airbus sales executive in the U.S. handling Northwest Airlines, a major Airbus client. Mr. Courpron's selection as ILFC's next leader "was a consensus decision" reached by Mr. Steenland, interim CEO Alan Lund and Mr. Benmosche, according to a person familiar with the matter, the Journal relates. The source told the Journal, Mr. Courpron impressed them with his "unparalleled" sales and marketing skills, and "his contacts in the industry are wide and deep." The source added that the new CEO should "be able to effectively place [leases for] airplanes and keep them placed." About AIG Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. About ILFC International Lease Finance Corporation, headquartered in Los Angeles, California, is the international market leader in the leasing and remarketing of advanced technology commercial jet aircraft to airlines around the world. ILFC owns a portfolio consisting of more than 1,000 jet aircraft. * * * ILFC carries Fitch's 'BB' Issuer Default Rating. ILFC holds S&P's (BBB-/Watch Neg/--) Corp. credit rating. It holds 'B1' corporate family and senior unsecured ratings at Moody's. INTERNATIONAL COAL: Files Form 10-Q for March 31 Quarter -------------------------------------------------------- International Coal Group Inc. filed with the Securities and Exchange Commission its Form 10-Q for quarter ended March 31, 2010. The Company reported these results: * Adjusted EBITDA, or earnings before deducting interest, income taxes, depreciation, depletion, amortization, loss on extinguishment of debt and noncontrolling interest, increased to $46.9 million compared to $44.5 million for the first quarter of 2009. * Net loss was $8.9 million, or $0.05 per share on a diluted basis, for the first quarter of 2010 compared to net income of $3.7 million, or $0.02 per share on a diluted basis, for the first quarter of 2009. Net loss for the first quarter of 2010 included a $22.0 million pre-tax loss on extinguishment of debt related to the Company's capital restructuring. Excluding this loss, pro forma net income would have been $6.2 million, or $0.03 per share on a diluted basis. * Margin per ton sold increased 31% to $11.67 in the first quarter of 2010 compared to $8.94 for the same period last year, primarily due to higher realized prices and improved operational performance. * Revenues were $288.6 million for the first quarter of 2010 compared to $305.0 million for the first quarter of 2009, with the decrease primarily due to the weak thermal market. The Company's balance sheet at March 31, 2010, showed $1.58 billion in total assets and $834.28 million in total liabilities, for a stockholders' equity of $750.29 million. "Our first quarter results reflect strong performance from all our operations," said Ben Hatfield, President and CEO of ICG. "Both Adjusted EBITDA and margin on coal sales exceeded the first quarter of 2009 results." Mr. Hatfield continued, "We also moved toward completion of our strategic capital restructuring during the quarter. Our recapitalization efforts strengthened our liquidity, reduced future interest expense and significantly extended our debt maturity profile. In addition, we secured a new credit facility that provides increased borrowing capacity and greater flexibility." Mr. Hatfield concluded, "Coal markets continue to show improvement, particularly in the metallurgical sector. Metallurgical coal prices have further strengthened with recent international settlements. Thermal coal prices have not recovered to the same degree, but cold winter weather has helped to stabilize the pricing environment for that product." Liquidity and Debt As of March 31, 2010, the Company had $301.7 million in cash, of which $136.4 million was disbursed on April 6, 2010 in conjunction with the Company's repurchase of its 9% Convertible Notes. Currently, the Company has $41.6 million in borrowing capacity available under its new credit agreement. Debt outstanding as of March 31, 2010 totaled $473.2 million, net of a $43.5 million discount, consisting primarily of $115.0 million aggregate principal amount of newly issued 4.0% Convertible Senior Notes and $200.0 million aggregate principal amount of newly issued 9.125% Senior Secured Second-Priority Notes. Debt also included $139.5 million aggregate principal amount of the Company's previously issued 9.0% Convertible Notes and $5.9 million aggregate principal amount of the Company's previously issued 10.25% Senior Notes. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?61d0 About International Coal Group 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. JACKIE SAUNDERS: Voluntary Chapter 11 Case Summary -------------------------------------------------- Joint Debtors: Jackie Lee Saunders Betty Sue Saunders 1095 Twin Cedars Road Chickamauga, GA 30707 Bankruptcy Case No.: 10-12866 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Eastern District of Tennessee (Chattanooga) Judge: John C. Cook Debtor's Counsel: Lorraine Raymond, Esq. 3335 Ringgold Road, Suite 104 East Ridge, TN 37412 Tel: (423) 697-9016 E-mail: loriatt@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Joint Debtors did not file a list of creditors together with its petition. The petition was signed by the Joint Debtors. JANICE & J.W.: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Janice & J.W. Snyder, Inc. 4522 Road 16 Harrisburg, NE 69345 Bankruptcy Case No.: 10-41523 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court District of Nebraska (Lincoln Office) Debtor's Counsel: William L. Needler, Esq. William L. Needler & Associates, Ltd. P.O. Box 177 Ogallala, NE 69153 Tel: (308) 284-4505 Fax: (308) 284-3813 E-mail: williamlneedler@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by J. W. Snyder, president. JOHN SNYDER: Voluntary Chapter 11 Case Summary ---------------------------------------------- Joint Debtors: John W. Synder Janice L. Snyder dba J.W. Snyder Partnership J Bar2 Producers Limited Partnership 4572 Road 16 Harrisburg, NE 69345 Tel: (308) 235-5687 Bankruptcy Case No.: 10-41524 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court District of Nebraska (Lincoln Office) Debtor's Counsel: William L. Needler, Esq. William L. Needler & Associates, Ltd. P.O. Box 177 Ogallala, NE 69153 Tel: (308) 284-4505 Fax: (308) 284-3813 E-mail: williamlneedler@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Joint Debtors did not file a list of creditors together with its petition. The petition was signed by the Joint Debtors. LARS LANGLO: Case Summary & 11 Largest Unsecured Creditors ---------------------------------------------------------- Joint Debtors: Lars Herbert Langlo Marion Liane Langlo 604 W. Massachusetts Street Hernando, FL 34442 Bankruptcy Case No.: 10-04186 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Middle District of Florida (Jacksonville) Judge: Paul M. Glenn Debtor's Counsel: Robert D. Wilcox, Esq. Wilcox Law Firm Enterprise Park 4190 Belfort Road, Suite 315 Jacksonville, FL 32216 Tel: (904) 281-0700 Fax: (904) 513-9201 E-mail: rwilcox@wilcoxlawfirm.com Scheduled Assets: $1,535,863 Scheduled Debts: $3,231,734 A list of the Company's 11 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb10-04186.pdf The petition was signed by Lars Herbert Langlo and Marion Liane Langlo. LEHMAN BROTHERS: LBI Trustee Has Received $84.4MM for Work ---------------------------------------------------------- Bill Rochelle at Bloomberg News reports that the trustee for Lehman Brothers Holdings' brokerage and his law firm were paid $84.4 million for 19 months' work liquidating the defunct affiliate, according to a bankruptcy court filing. The brokerage operations went into liquidation on Sept. 19. Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Judicial Watch Files Lawsuit to Obtain Documents ----------------------------------------------------------------- Judicial Watch, the public interest group that investigates and prosecutes government corruption, filed a Freedom of Information Act (FOIA) lawsuit on May 11 against the Board of Governors of the Federal Reserve System for documents related to the bailout of American International Group (AIG) and the bankruptcy of Lehman Brothers. The lawsuit was filed on behalf of former Federal Reserve employee Vern McKinley. The lawsuit is part of Judicial Watch's comprehensive investigation to determine under what legal authorities and lawful rationales the federal government initiated the Wall Street bailouts. With his March 21, 2010, FOIA request targeting information related to the AIG bailout, McKinley requested: "... any and all communications and records concerning or relating to the Board [of Governors'] decision that detail that 'the disorderly failure of AIG was likely to have a systemic effect on financial markets that were already experiencing a significant level of fragility,' as described in the [Board] meeting minutes." With his March 28, 2010, FOIA request targeting information related to Lehman Brothers, McKinley requested: "... any and all communications and records regarding analysis undertaken regarding Lehman Brothers and the assessment in September 2008 or earlier of what 'contagion' might have flowed from Lehman Brother's filing of bankruptcy, as the word contagion was used in the case of the Board of Governors' deliberations over Bear Stearns... or 'systemic effect of financial markets' that may have flowed from a Lehman Bankruptcy as the phrase was used in the Board of Governors' deliberations over American International Group... " The Board of Governors acknowledged receipt of both FOIA requests but failed to respond within the statutory allotted time period, prompting McKinley's lawsuit. "We are now trillions of taxpayer dollars into these financial bailouts and a fundamental question remains unanswered: Under what authority did the federal government take such a radically intrusive approach to the financial crisis? How were the bailout winners and losers chosen? The Federal Reserve and the Obama administration owe the American people an explanation," said Judicial Watch President Tom Fitton. Judicial Watch currently has two additional FOIA lawsuits ongoing on behalf of Mr. McKinley related to the bailouts of Bear Stearns, Bank of America and Citigroup. Visit www.JudicialWatch.org to access documents related to these lawsuits. About AIG Based in New York, American International Group, Inc., is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies provide life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. In September 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEVEL 3 COMMS: Posts $238 Million Net Loss for March 31 Quarter --------------------------------------------------------------- Level 3 Communications Inc. filed its quarterly report on Form 10- Q, disclosing a net loss of $238 million on $910 million of total revenues for the three months ended March 31, 2010, compared with a net loss of $132 million on $980 million of total revenues during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $8.6 billion in total assets and $8.4 billion total liabilities, for a stockholders' equity of $221.9 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a7 Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. LINEAR TECHNOLOGY: Posts $100MM Net Income for March 28 Quarter --------------------------------------------------------------- Linear Technology Corporation filed its quarterly report on Form 10-Q, showing net income of $100.6 million on $311.3 million of revenues for the three months ended March 28, 2010, compared with net income of $49.3 million on $200.9 million of revenues for the three months ended March 29, 2009. The Company's balance sheet showed $1.61 billion in total assets and $1.66 billion in total liabilities, for a stockholder's deficit of $50.7 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a6 Milpitas, California-based Linear Technology Corporation (NASDAQ- LLTC) -- http://www.linear.com/-- manufactures high performance linear integrated circuits, including high performance amplifiers, comparators, voltage references, monolithic filters, linear regulators, DC-DC converters, battery chargers, data converters, communications interface circuits, RF signal conditioning circuits, uModuleO products, and many other analog functions. MAGIC BRANDS: Sets June 17 Auction for Fuddruckers & Koo Koo Roo ---------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that the Bankruptcy Court entered an order authorizing Magic Brands LLC to conduct an auction to sell its Fuddruckers and Koo Koo Roo restaurants business on June 17. Competing bids are due June 14. The hearing for approval of the sale is scheduled for June 22. The Bankruptcy Court approved Travistock Group as the stalking horse bidder but the judge reduced the break-up fee by 70%. Travistock's break-up fee and expenses are now capped at $400,000. The official committee of unsecured creditors objected to the break-up fee after competing bidders Fidelity Newport Holdings LLC and American Blue Ribbon Holdings LLC said they are willing to pay $1 million more without a breakup fee. According to Bloomberg, the sale needs to be completed quickly because Magic Brands filed projections with the bankruptcy court showing that cash would be almost exhausted by July. Bloomberg relates that at the May 17 hearing, the judge also gave final approval for $13.8 million in financing for the Chapter 11 case. The judge approved a bonus program for executives and other officers. Depending on the result of the auction, the bonus pool could be as large as $1.66 million. About Magic Brands Magic Brands, LLC, is the parent of the Fuddruckers and Koo Koo Roo restaurant brands. Fuddruckers -- http://www.fuddruckers.com/ -- was founded in 1980 in San Antonio, Texas, with the goal of serving hamburgers that are cooked to order and made with fresh ingredients. Magic Brands, based in Austin, Texas, purchased the chain in 1998 and has sought to broaden its appeal by expanding its menu. Magic Brands, LLC, and its operating units filed for Chapter 11 on April 21, 2010 (Bankr. D. Del. Lead Case No. 10-11310). It disclosed assets of up to $10,000,000 and debts of $10,000,001 to $50,000,000. Affiliate Fuddruckers, Inc., also filed, listing assets and debts of $50,000,000 to $100,000,000. FocalPoint Securities, LLC, serves as investment banker to Magic Brands and Goulston & Storrs serves as lead bankruptcy counsel. Kurtzman Carson Consultants, LLC, serves as claims and notice agent. MESA AIR: District Court Allows Delta to Scrap Contract ------------------------------------------------------- Mesa Air Group, Inc., said that the U.S. District Court for the Northern District of Georgia ruled against its subsidiary Freedom Airlines in its litigation with Delta Air Lines regarding Delta's efforts to terminate an agreement covering 22 regional jet aircraft. According to Mesa Air, the litigation stemmed from Delta's asserted termination of the Freedom Airlines agreement based upon flights canceled at Delta's request, during periods of operational irregularity (bad weather and ATC delays) at JFK in order to make way for Delta's larger jets, which were then retroactively held against Freedom for purposes of calculating its minimum flight completion factor. Based upon this retroactive calculation, the Court had issued a preliminary injunction in June 2008 prohibiting Delta from terminating the agreement. In reaching its decision, the Court reversed its prior preliminary injunction preventing Delta from terminating the agreement. The Company is in the process of reviewing the Order and evaluating options going forward. Mesa has not yet reviewed its options for appeal. "We are extremely disappointed by the District Court's decision. We have at all times sought to act as a good partner and work with Delta as a member of Delta Connection. Unfortunately Freedom's willingness to proactively cancel flights in JFK at Delta's request for the benefit of Delta was held against Freedom and was used as the sole basis to terminate our contract. It is disheartening that our Company and people will be punished retroactively for taking actions in good faith at Delta's direction," said Jonathan Ornstein, Chairman and Chief Executive of Mesa Air Group. "We are greatly concerned for our approximately 500 employees who will be significantly impacted as a result of this decision, despite their hard work and commitment which has placed Freedom's operation at or near the top of the Delta Connection portfolio over the last year. The loss of these jobs, particularly under these circumstances is extremely disappointing. I would like to thank all of the employees at Freedom for the outstanding job they have done over the last two years under extremely difficult circumstances," continued Mr. Ornstein. About Mesa Air Group Mesa currently operates 130 aircraft with approximately 700 daily system departures to 127 cities, 41 states, Canada, and Mexico. Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways and United Airlines, respectively, and independently as Mesa Airlines and go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company, founded by Larry and Janie Risley in New Mexico in 1982, has approximately 3,500 employees. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5, 2010, in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). 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. * * * 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. (Bankruptcy Creditors Service Inc. publishes Delta Air Lines Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000). MERITAGE HOMES: Fitch Affirms IDR at 'B+'; Outlook Stable --------------------------------------------------------- Fitch Ratings has affirmed Meritage Homes Corporation's (Meritage; NYSE: MTH) ratings as follows: --Issuer Default Rating (IDR) at 'B+'; --Senior unsecured debt at 'BB-/RR3'; --Senior subordinated debt at 'B-/RR6'. The Rating Outlook has been revised to Stable from Negative. The Recovery Rating (RR) of 'RR3' on the company's senior unsecured debt indicates good recovery prospects for holders of these debt issues. Meritage's exposure to claims made pursuant to performance bonds and joint venture debt and the possibility that part of these contingent liabilities would have a claim against the company's assets were considered in determining the recovery for the unsecured debt holders. The 'RR6' on Meritage's senior subordinated debt indicates poor recovery prospects in a default scenario. Fitch applied a liquidation value analysis for these RRs. The ratings affirmation and the Outlook revision to Stable from Negative reflect the company's healthy liquidity position, improved operating results and moderately stronger prospects for the housing sector this year. The ratings also reflect the company's conservative land policies, geographic and product line diversity, acquisitive orientation, capital structure and the still challenging U.S. housing environment. Meritage's sales are reasonably dispersed among its 12 metropolitan markets within six states. The company ranks among the top ten builders in such markets as Houston, Dallas/Fort Worth, San Antonio and Austin, TX, and Phoenix, AZ. The company also builds in Sacramento, East Bay and Riverside/San Bernardino, CA, Las Vegas, NV, Denver, CO, Tucson, AZ and Orlando, FL. Historically, about 70-75% of home deliveries are to first and second time trade up buyers, 10-15% to entry level buyers, 5% are to luxury home buyers and 5-10% to active adult (retiree) buyers. Currently, 60-65% of sales are to entry level and first time move- up buyers. Meritage employs conservative land and construction strategies. The company typically options or purchases land only after necessary entitlements have been obtained so that development or construction may begin as market conditions dictate. Under normal circumstances Meritage extensively uses lot options, and that is expected to be the future strategy in markets where it is able to do so. The use of non-specific performance rolling options gives the company the ability to renegotiate price/terms or void the option which limits down side risk in market downturns and provides the opportunity to hold land with minimal investment. However, as of March 31, 2010, 22% of Meritage's lots were controlled through options - a much lower than typical percentage due to considerable option abandonments and write-offs in recent years. Additionally, there are currently fewer opportunities to option lots and, in certain cases, the returns for purchasing lots outright are better than optioning lots from third parties. Total lots, including those owned, were approximately 13,308 at March 31, 2010. This represents a 3.4 year supply of total lots controlled and 2.4 year supply of owned land based on trailing 12 months deliveries. The company generated $43.9 million of cash flow from operations during the first quarter of 2010, including a tax refund of $90.5 million as a result of the tax legislation enacted in November 2009. For all of fiscal 2010, Fitch expects Meritage to be cash flow negative, excluding tax refunds, as the company starts to rebuild its land position. The company expects to spend roughly $200-250 million on land purchases this year compared with approximately $182 million spent in 2009. Meritage has ample liquidity with $242.7 million of unrestricted cash and $175.7 million of marketable securities as of the end of the fiscal 2010 first quarter. More recently, the company completed the issuance of $200 million of 7.15% 10-year senior notes. Proceeds from the notes offering were used to redeem certain of the company's outstanding senior notes. Following the debt issuance and redemption, the company will not have any major debt maturities until 2015, when $284.3 million of senior notes become due. Meritage also has a $53 million letter of credit facility. In September 2009, Meritage voluntarily terminated its $150 million revolving credit facility. Consistent with Fitch's comment on homebuilders' termination of revolving credit facilities, in the absence of a revolving credit line, a consistently higher level of cash and equivalents than was previously typical should be maintained on the balance sheet, especially in these still uncertain times. Housing apparently bottomed during 2009, and a so far anemic recovery has begun. During the next 12-15 months off the bottom, the recovery may appear jaw-toothed as substantial foreclosures now in the pipeline present as distressed sales and as meaningful new foreclosures arise from Alt-A and option ARM resets. High unemployment rates and the tightening of certain Federal Housing Administration loan standards will be notable headwinds early in the upcycle. The continuation and expansion of the scope of the national housing credit may have boosted sales in spring of this year. And the Federal government's continuing efforts to modify foreclosures may finally show some success in 2010. Future ratings and Outlooks will be influenced by broad housing market trends as well as company specific activity, such as trends in land and development spending, general inventory levels, speculative inventory activity (including the impact of high cancellation rates on such activity), gross and net new order activity, debt levels and especially free cash flow trends and uses, and the company's cash position. MEYER LOGISTICS: Case Summary & 19 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Meyer Logistics, LLC 2400 Broadway East St. Louis, IL 62205 Bankruptcy Case No.: 10-45420 Chapter 11 Petition Date: May 16, 2010 Court: U.S. Bankruptcy Court Eastern District of Missouri (St. Louis) Judge: Charles E. Rendlen III Debtor's Counsel: Nathan H. Goldberg, Esq. Goldberg Law Firm, LLC 6901 Gravois Road St. Louis, MO 63116 Tel: (314) 771-1900 Fax: (314) 771-1903 E-mail: nathan@goldberglawllc.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 According to the schedules, the Company says that assets total $1,383,755 while debts total $816,093. A copy of the Company's list of 19 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/moeb10-45420.pdf The petition was signed by Gilbert Meyer, member and owner. MGM MIRAGE: Posts $96.7 Million Net Loss for March 31 Qtr. ---------------------------------------------------------- MGM MIRAGE filed its quarterly report Form 10-Q, showing a net loss of $96.7 million on $1.457 billion of net revenue for the three months ended March 31, 2010, compared with a net income of $105.1 million on $1.499 billion of net revenue during the same period a year ago. The Company's balance sheet at March 31, 2010, revealed $21.0 billion in total assets, $1.1 billion in total current liabilities, $3.1 billion in deferred income taxes, $12.6 billion in long term debt, and $253.2 million in other long term obligations, for a total stockholders' equity of $3.7 billion. Financial Position At March 31, 2010, the Company had approximately $13.0 billion of indebtedness, including $3.8 billion of borrowings outstanding under its senior credit facility, with available borrowing capacity under the senior credit facility of approximately $900 million. These balances reflect the impact of the Company's March issuance of $845 million of 9% senior secured notes due 2020. The net proceeds of such issuance were used to repay a portion of the senior credit facility, including a permanent reduction of $818 million as required under the Company's amended and restated senior credit facility. Subsequent to March 31, 2010, the Company received a tax refund of approximately $380 million, the proceeds of which were used to reduce outstanding borrowings under the revolving portion of the senior credit facility. In addition, in April 2010, the Company issued $1.15 billion of 4.25% convertible senior notes due 2015 for net proceeds to the Company of $1.12 billion. After application of such proceeds, the Company had approximately $1.48 billion of availability under the revolving portion of the senior credit facility, of which approximately $1.12 billion was restricted for use to retire future debt maturities or permanently reduce commitments under the senior credit facility, and approximately $900 million of excess cash in bank. In connection with the convertible notes offering, the Company entered into capped call transactions at a cost of $81 million to reduce the potential dilution of the Company's stock upon conversion of the notes. "Our secured and convertible notes transactions were executed at pricing advantageous to the Company and reaffirms the confidence our financial partners have in the long term prospects of MGM MIRAGE," said Dan D'Arrigo, MGM MIRAGE Executive Vice President and Chief Financial Officer. "These transactions further enhance our balance sheet profile and provide our Company with approximately $2.4 billion of available liquidity -- we believe we have adequate liquidity to address upcoming debt maturities." A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a5 About MGM MIRAGE Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) -- http://www.mgmmirage.com/-- owns and operates 16 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, New Jersey, Illinois and Macau. CityCenter, an urban metropolis on the Las Vegas Strip scheduled to open in late 2009, is a joint venture between MGM MIRAGE and Infinity World Development Corp, a subsidiary of Dubai World. MGM MIRAGE Hospitality has entered into management agreements for future casino and non-casino resorts throughout the world. The Company reported $22.51 billion in total assets, $2.38 billion in total current liabilities, $3.03 billion in deferred income taxes, $12.97 billion in long term debt, and $256.83 million other long term obligation, resulting to a $3.87 billion stockholders' equity as of Dec. 31, 2009. At September 30, 2009, MGM MIRAGE had stockholders' equity of $4.29 billion. * * * As reported by the Troubled Company Reporter on March 22, 2010, Moody's Investors Service affirmed MGM MIRAGE's ratings, including its Caa1 Corporate Family Rating and raised the company's Speculative Grade Liquidity rating to SGL-3 from SGL-4. The rating outlook remains stable. As reported by the TCR on March 11, 2010, Standard & Poor's Ratings Services affirmed all of its existing ratings on MGM MIRAGE, including the 'CCC+' corporate credit rating. The rating outlook is developing. "The 'CCC+ corporate credit rating reflects MGM MIRAGE's significant debt burden, S&P's expectation for continued declines in cash flow generation in 2010, and the company's tight liquidity position," said Standard & Poor's credit analyst Ben Bubeck. MIDDLEBROOK PHARMA: Signs Deal to Sell to Victory for $17.1MM ------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Middlebrook Pharmaceuticals Inc. signed a contract to sell its assets for $17.1 million to Victory Pharma Inc. A hearing to consider approval of procedures to test whether there would be better offers is scheduled for June 7. Middlebrook wants to hold an auction between July 19 and July 23, with a hearing for approval of the sale around July 28. About MiddleBrook Pharmaceuticals Westlake, Texas-based Middlebrook Pharmaceuticals, Inc., aka Advancis Pharmaceuticals Corporation, is a pharmaceutical company focused on commercializing anti-infective products that fulfill unmet medical needs. MiddleBrook's proprietary delivery technology, PULSYS, enables the pulsatile delivery, or delivery in rapid bursts, of certain drugs. MiddleBrook currently markets MOXATAG, the first and only FDA-approved once-daily amoxicillin, and KEFLEX, the immediate-release brand of cephalexin. The Company filed for Chapter 11 bankruptcy protection on April 30, 2010 (Bankr. D. Del. Case No. 10-11485). Joel A. Waite, Esq., at Young, Conaway, Stargatt & Taylor, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. MILL CREEK: Case Summary & 6 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Mill Creek Holdings, LLC 107 Stokley Road, Suite 102 Wilmington, NC 28403 Bankruptcy Case No.: 10-03972 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court Eastern District of North Carolina (Wilson) Judge: Stephani W. Humrickhouse Debtor's Counsel: George M. Oliver, Esq. Oliver & Friesen, PLLC P.O. Box 1548 New Bern, NC 28563 Tel: (252) 633-1930 Fax: (252) 633-1950 E-mail: efile@oliverandfriesen.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of 6 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nceb10-03972.pdf The petition was signed by Mark Brisson, member/manager. MITEL NETWORKS: Moody's Upgrades Corporate to 'B3' After IPO ------------------------------------------------------------ Moody's Investors Service upgraded Mitel Networks Corporation's corporate family rating (CFR) and probability of default rating (PDR), each to B3 from Caa1, and revised the rating outlook to stable from negative after the company completed an IPO that saw book debt reduced by nearly 23% ($102 million). The combination of the CFR and PDR upgrades and debt pay-down resulted in two notch rating upgrades for the company's individual debt instruments; specifically, the company's senior secured credit facilities are now rated B1 (previously B3) and its second lien debt is now rated Caa1 (previously Caa3). The combination of the debt pay-down plus surplus cash from the IPO also resulted in much improved liquidity; Mitel was assigned an SGL-2 speculative grade liquidity rating (indicating good liquidity). Ratings and outlook actions: Issuer: Mitel Networks Corporation - Corporate Family Rating, Upgraded to B3 from Caa1 - Probability of Default Rating, Upgraded to B3 from Caa1 - Senior Secured First Lien Bank Credit Facility, Upgraded to B1 (LGD2, 29%) from B3 (LGD3, 36%) - Senior Secured Second Lien Bank Credit Facility, Upgraded to Caa1 (LGD5, 78%) from Caa3 (LGD5, 85%) - Outlook, Changed To Stable From Negative - Speculative Grade Liquidity Rating -- Assigned SGL-2 The rating actions also account for the anticipated impact of gradually improving general economic conditions, recent cost- cutting initiatives, and reduced interest expense resulting from the debt pay-down and recent expiry of a hedge that had locked-in a relatively high fixed rate. However, earnings visibility continues to be quite poor particularly as international sovereign debt matters weigh on the nascent economic recovery. Additionally, as the need to refinance debts rolls into the rating horizon -- Mitel's revolving credit facility matures in August, 2012 and its term credit facilities mature in August, 2014 -- the company will need to demonstrate an ability to amortize debt, something that has been elusive over most of the recent past. With good liquidity and expectations of modest cash flow surpluses, the ratings outlook is stable. Mitel has an SGL-2 speculative grade liquidity ratings indicating good liquidity. Subsequent to a recent $130 million IPO and a $102 million debt pay-down, Mitel has cash on its balance sheet and full availability under its $30 million revolving credit facility. Moody's most recent rating action concerning Mitel was taken on September 1, 2009, at which time the company's CFR and PDR were downgraded to Caa1 and the ratings outlook was revised to negative. Based in Ottawa, Ontario, Mitel provides integrated internet protocol based enterprise telephony solutions for small and medium sized businesses. MONEYGRAM INTERNATIONAL: Files Form 10-Q for March 31 Quarter ------------------------------------------------------------- MoneyGram International Inc. filed its report Form 10-Q for the quarter ended March 31, 2010, with the Securities and Exchange Commission. The Company's balance sheet at March 31, 2010, showed $5.666 billion in total assets against $5.664 billion in total liabilities, and $896.0 million in total mezzanine equity for a stockholders' deficit of $896.0 million. The Company reported $10.8 million net income on $166.2 million of net revenue for the three months ended March 31, 2010, compared with $11.8 million of net income on $160.9 million of net revenue for the same period a year ago. "MoneyGram delivered solid financial results from our core money transfer business in the quarter," said Pamela H. Patsley, MoneyGram chairman and chief executive officer. "We created important partnerships with industry leaders like Fiserv and SMART Communications to bring more value and added convenience to existing consumers and expand our reach to new consumers. We also launched our enhanced website and continued to increase our global agent network. We continue to strengthen our management team with three new key executives Nigel Lee, EVP of EMEAAP, Luke Wimer, EVP of Operations and Technology, and Juan Agualimpia, SVP & CMO, who are focused on transaction growth, operating efficiencies, and enhancing our brand." A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62c6 About MoneyGram International Minneapolis, Minnesota, MoneyGram International (NYSE:MGI) -- http://www.moneygram.com/-- offers more control and more choices for people separated by distance or with limited bank relationships to meet their financial needs. MoneyGram helps consumers to pay bills quickly and safely send money around the world in as little as 10 minutes. Its global network is comprised of 190,000 agent locations in nearly 190 countries and territories. MoneyGram's convenient and reliable network includes retailers, international post offices and financial institutions. At December 31, 2009, the Company had total assets of $5.879 billion against $5.877 billion in total liabilities, $864.328 million in mezzanine equity and $862.763 million in stockholders' deficit. According to the Troubled Company Reporter on April 27, 2010, Moody's Investors Service affirmed the B1 corporate family rating for MoneyGram International Inc and revised the rating outlook to stable from negative. The revision of the outlook to stable is based on solid performance of the money transfer business amidst the global recession and the stabilization of the Financial Paper Products segment. MOVIE GALLERY: Sees Liquidating Plan Filed by June 21 ----------------------------------------------------- Bill Rochelle at Bloomberg News reports that Movie Gallery Inc. is asking the Bankruptcy Court to extend its exclusive period to propose a Chapter 11 plan until July 31. If there's an objection to the exclusivity motion, a hearing will be held May 27. According to the report, Movie Gallery Inc., now liquidating its remaining stores, says it has agreement with what it called "major stakeholders" to file a liquidating plan by June 21 and implement the plan by Dec. 8. 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 4and 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. Bankruptcy Creditors' Service, Inc., publishes Movie Gallery Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Movie Gallery Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). MOVIE GALLERY: Rival Liquidator Says Break-Up Fee Not Needed ------------------------------------------------------------ Movie Gallery Inc. previously signed an agreement under which Great American Group Inc. guaranteed $62.3 million in return for being named agent to conduct the going-out-of-business sale for the remaining 1,028 video-rental stores. The deal calls for paying Great American a break-up fee of $1,750,000 plus expense reimbursement of up to $100,000 if another liquidator wins the auction for the right to sell off the assets. Bill Rochelle at Bloomberg News reports that Hilco Merchant Resources LLC and an affiliate of Gordon Brothers Group LLC told the bankruptcy court that the break-up fee is not necessary. They said that they offered almost the same contract to Movie Gallery with no break-up fee requirement. They said the price they offered Movie Gallery was "substantially similar." They also said that, aside from the breakup fee, Great American's arrangement is nothing novel. They characterized it as a "traditional equity transaction that has been used many times." BankruptcyData.com reports that the Official Committee of Unsecured Creditors reserved rights to object to the approval of a new agency agreement with a successful over bidder if that agency agreement materially varies from the GA Agreement entered between the Debtors and Great American. The Bankruptcy Court was scheduled to hold a hearing on May 19 to consider approval of the auction rules and the break-up fee. 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 4and 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. Bankruptcy Creditors' Service, Inc., publishes Movie Gallery Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Movie Gallery Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). NATIONAL CENTURY: Appeals Court Revives Amedisys' Claims -------------------------------------------------------- Bankruptcy Law360 reports that a federal appeals court has revived some of Amedisys Inc.'s claims in its dispute with National Century Financial Enterprises Inc. over more than $7.3 million, but upheld the dismissal of JPMorgan Chase Bank as a defendant in the case. Law360 reports that the U.S. Court of Appeals for the Sixth Circuit on Tuesday found that there was a material issue of fact over who owned the approximately $7.3 million on deposit. About National Century Headquartered in Dublin, Ohio, National Century Financial Enterprises, Inc. -- http://www.ncfe.com/-- was the largest issuer of medical accounts receivable asset backed securities in the United States before it collapsed in bankruptcy in November 2002 amid allegations of widespread fraud and misappropriation of assets. To date, 10 senior executives of the company have been convicted or pled guilty to federal charges of conspiracy, securities fraud, wire fraud, and money laundering arising out of the NCFE securitization program. NCFE -- through the CSFB Claims Trust, the Litigation Trust, the VI/XII Collateral Trust, and the Unencumbered Assets Trust -- is in the midst of liquidating estate assets. The Company filed for Chapter 11 protection on November 18, 2002 (Bankr. S.D. Ohio Case No. 02-65235). The Court confirmed the Debtors' Fourth Amended Plan of Liquidation on April 16, 2004. Paul E. Harner, Esq., at Jones Day, represented the Debtors. NEFF CORP: Case Summary & 30 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Neff Corp. 3750 N.W. 87th Avenue Suite 400 Miami, FL 33178 Bankruptcy Case No.: 10-12610 About the Business: Privately held Neff Corp., doing business as Neff Rental, provides construction companies, golf course developers, industrial plants, the oil industry, and governments with reliable and quality equipment that is delivered on time where it is needed. With more than 1,000 employees operating from branches coast to coast, Neff Rental is ranked by Rental Equipment Register (RER) magazine as one of the nation's 10 largest equipment rental companies. Chapter 11 Petition Date: May 16, 2010 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Brian S. Lennon, Esq. Kirkland & Ellis LLP 153 East 53rd Street New York, NY 10022 Tel: (212) 446-4800 Fax: (212) 446-4900 E-mail: blennon@kirkland.com Debtor's Restructuring Advisor: AlixPartners, LLC Debtor's Real Estate Consultants: Hilco Real Estate, LLC Debtor's Investment Adviser: Miller Buckfire & Co., LLC Debtor's Tax Advisor: Deloitte Tax LLP Debtor's Independent Auditor: Deloitte & Touche LLP Debtor's Claims & Notice Agent: Kurtzman Carson Consultants LLC Estimated Assets: $100,000,001 to $500,000,000 Estimated Debts: $500,000,001 to $1 billion Neff Corp. said in a court filing that assets total $299 million while debts total $609 million. Funded debt totals $580 million. The petition was signed by Mark Irion, chief financial officer. Debtor-affiliates that filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- Neff Holdings LLC 10-12607 5/16/10 Neff Holdings Corp. 10-12609 5/16/10 Neff Corp. 10-12610 5/16/10 Neff Rental LLC 10-12611 5/16/10 Neff Rental, Inc. 10-12612 5/16/10 Neff Finance Corp. 10-12613 5/16/10 Neff Corp.'s List of 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wells Fargo Bank, N.A. Bond Debt $34,286,000 as Indenture Trustee 231 Court St., Suite 703 Middletown, CT 06457 Genie Industries Trade Payable $165,815 Clark Equipment Company Trade Payable $125,144 Compact Excavator Trade Payable $98,349 Sales, Inc. Case Machines/CNH Trade Payable $72,045 Capital Sullivan-Palatek, Inc. Trade Payable $65,914 JLG Equipment Services Trade Payable $59,212 Inc. Wacker Neuson Trade Payable $56,584 Corporation Excel Equipment LLC Litigation Claim $52,852 Multiquip, Inc. Trade Payable $47,167 Cintas Corporation Trade Payable $46,733 Great Lakes Petroleum Trade Payable $39,761 Haulotte U.S. Inc. Trade Payable $36,747 Nortrax Southeast Trade Payable $36,564 BP Lubricants USA Inc. Trade Payable $35,372 Wilson-Finley Co. Trade Payable $32,912 A-1 Transportation Trade Payable $26,250 Services H&E Equipment Services, Trade Payable $26,246 Inc. Hertz Equipment Rental Trade Payable $23,925 Duhon Machinery Co., Trade Payable $23,518 Inc. Kobelco America Inc. Trade Payable $22,136 Husqvarna Construction Trade Payable $21,313 Products JLG Industries Inc. Trade Payable $20,664 Tag Manufacturing Inc. Trade Payable $20,526 Aflac Trade Payable $19,694 DSI (Data Supplies Inc.) Trade Payable $17,373 Worldwide Express Trade Payable $17,360 Brunner & Lay Inc. Trade Payable $16,985 Transport Specialists Trade Payable $16,885 Inc. Sullair Corporation Trade Payable $16,623 NEW ANTIOCH: Case Summary & 7 Largest Unsecured Creditors --------------------------------------------------------- Debtor: New Antioch Missionary Baptist Church 3485 Rhodes Avenue Memphis, TN 38111 Bankruptcy Case No.: 10-25310 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court Western District of Tennessee (Memphis) Judge: David S. Kennedy Debtor's Counsel: Cedrick Wooten, Esq. Law Office of Cedrick Wooten 4646 Poplar Avenue, Suite 530 Memphis, TN 38117 Tel: (901) 881-5107 E-mail: cwoolaw@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 According to the schedules, the Company says that assets total $1,432,211 while debts total $897,654. A copy of the Company's list of 7 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/tnwb10-25310.pdf The petition was signed by Joseph T. Jackson Sr., pastor. NEWLAND INTERNATIONAL: Fitch Maintains Negative Watch Status ------------------------------------------------------------ Fitch Ratings maintained the Rating Watch Negative status on Newland International Properties, Corp.'s (Newland) $220 million senior secured notes currently rated 'B+'. The transaction was originally placed on Rating Watch Negative on April 20, 2010, due to the $26.9 million construction cost overrun, a delay in construction completion and on-going concerns over the willingness and ability of the end-buyer to take possession of units upon delivery. While the construction escrow account was fully replenished on May 14, 2010, the transaction will remain on Watch Negative over continuing concerns regarding future cost overruns and delivery delays, as well as to monitor the ability of buyers to obtain mortgage financing. Newland is developing the Trump Ocean Club International Hotel & Tower (TOC), a multi-use tower located on the Punta Pacifica Peninsula in Panama City, Panama. As a result of the cost overrun announced in March, Newland was required to replenish the construction escrow account by the amount of the cost overrun within 10 business days of receipt of the certified engineer's report verifying the overrun, which was presented on May 3, 2010. While Newland did, in fact, provide the funds needed to replenish the account within the stipulated timeframe it did so via a Consent Solicitation Statement, and also requested various amendments to the original indenture, which are discussed below. Additionally, in order to make its May 2010 payment, Newland used funds in the amount of $8.2 million from the debt service reserve account (DSRA), which it must now replenish by July 15, 2010. Funds to replenish this account are expected from the receipt of approximately $6.1 million from proceeds of the bulk sale identified in the consent solicitation, $1.5 million from funds in the release account and the remainder from scheduled collections. The changes that were part of the consent solicitation notice provided for the flow of funds from the trust accounts to be on a daily basis rather than monthly, and the withdrawal and collateralization ratios to now incorporate a certain percentage of unsold inventory in their calculation: 50% of list price prior to the completion of construction and 65% of the list price post construction. By allowing unsold inventory into the calculation, Newland is now less dependent upon new unit sales to maintain the required collateralization and withdrawal ratios and is able to more easily obtain funds from the trust. Although this change can be considered to be less stringent than in the original indenture, given that the project is in its final stages of construction and gross collections from already sold units are currently estimated at $273 million, it is Fitch's opinion that the inclusion of this inventory will not materially impact that transaction. Newland is also prohibited from paying any dividends out until the amount of cash held in the investment account is equal to the outstanding debt balance. Another change to the original indenture pertains to the requirement to collect funds for the next debt service payment via the collection account, prior to releasing funds, other than stated working capital, to the borrower. Following the May 2010 payment, the collection account will no longer trap funds for this purpose. The separate DSRA will still be required to be maintained with the next payment and to be replenished within 60 days if used to make a required debt service payment. Similar to the inclusion of the unsold inventory in the collateralization and withdrawal ratios, this change is viewed as weakening the structure for investors. If Newland were to be fully dependent upon using the DSRA for the November 2010 payment, liquidity in the transaction could be affected as the account will need to be fully replenished within 60 days. However, this concern is partially mitigated by the large amount of receivables expected to be collected beginning in January 2011 as unit delivery begins. Also as part of the consent solicitation, the licensing agreement between Newland and the Trump organization was modified to include a cap on the fees paid to Trump upon the closing of units within the project which will result in an approximate cost reduction of $11.5 million. Fitch's main concerns at this time continue to be related to the possibility of future cost overruns, delivery delays and the ability of buyers to obtain necessary mortgage financing in the current market environment. To better understand these concerns, Fitch recently completed a comprehensive site visit, met with the management and construction teams and conducted independent market research on the high-end residential market in Panama. Construction on the property is moving along at a steady pace, and management has stated the majority of the remaining work has been contracted, minimizing the possibility of future cost overruns. In addition, most of the more complicated structural work at the project has been completed, with the remaining work comprised mostly of finishing units, which is more straightforward and less susceptible to unexpected costs and delays. Nonetheless, there could be some variation in the expected costs, especially within the labor component. Partially offsetting this concern is the $4.8 million minimum required balance in the construction account which is equal to 7.5% of the estimated cost of completion ($63.4 million), which could be used to cover future shortfalls if necessary. The transaction is now more sensitive to any additional delivery delays as the replenishment of the DSRA could be dependent upon collecting final receivables. If the November 2010 payment is made from funds in the DSRA, Newland has 60 days to replenish the account in full. If unit delivery does not begin in January 2011, as currently expected, there could be a shortfall in the DRSA, which would result in a technical default of the transaction. Significant delays beyond May 2011 could result in an actual payment default. As mentioned previously, once unit deliveries commence, projected receivables are expected to be sufficient to replenish the account and cover the May 2011 debt service obligations, but any delays in delivery, could impact these collections. Maintaining the Negative Watch on the transaction is due, in part, to this concern and Fitch will be closely monitoring the current unit delivery timeline for any further pressure. Ultimately, though, Newland is prohibited from making any dividend or equity payouts unless construction is completed and the restricted payment ratio, defined as the aggregate amount of all cash equivalents in the investment account over the sum of the remaining principal balance and all additional interest payments on the notes is equal to or greater than 100%. Market conditions continue to be a concern as well, although the market appears to have leveled off somewhat after declines experienced in 2009. Even Miami, sometimes seen as a somewhat comparative market, has begun to bottom out in pricing, and sales volumes have increased over 2009. According to a study completed for the Miami Downtown Development Authority, occupancy levels in new condominium projects has improved to 74% as of March 2010. Throughout the economic downturn, Newland has been able to continue to sell units and thus far been able to manage liquidity sufficiently to meet its debt service obligations. In the Panama market, prices are estimated to have dropped between 20%-25% from their peak in 2008 and TOC has been affected along with the market, with list prices for remaining inventory reflecting this decline. However, while below the peak of 2008, prices are still slightly higher than those paid for units during the pre- construction phase in 2006, providing an incentive for these early buyers to still take delivery of their units. Additionally, since the majority of the sales for the project occurred during the pre- construction phase a large share of the expected receivables are also tied to these unit purchases, which still remain at or slightly above current market prices. Downpayments for units currently average 32%, which would be retained by Newland in the event that a buyer chooses not to ultimately buy their unit. The sales and management teams for the development have also been working closely with local area mortgage brokers to assist buyers in finding mortgage financing for units if needed. NEXCEN BRANDS: Reports $700,000 Net Loss for First Quarter 2010 --------------------------------------------------------------- NexCen Brands, Inc., reported unaudited financial results for the first quarter of 2010. Total revenues in the first quarter of 2010 decreased 16% to $10.0 million from $12.0 million in the first quarter of 2009. The decrease is primarily due to current economic conditions, including continued weak credit markets for franchisees and softness in consumer spending and retail traffic. Total operating expenses in the first quarter of 2010 decreased 18.6% to $8.3 million from $10.2 million in the first quarter of 2009. Total operating expenses in the first quarter of 2010 included $100,000 in strategic initiative expenses associated with identifying and evaluating alternatives to the Company's debt and capital structure. Operating income in the first quarter of 2010 of $1.7 million as compared to $1.8 million in the first quarter of 2009 was essentially flat. Net loss in the first quarter of 2010 was $700,000, or ($0.01) per diluted share compared to a loss of $900,000 or ($0.02) per diluted share in the first quarter of 2009. Cash generated from operations was $1.2 million in the first quarter of 2010 compared to $400,000 in the first quarter of 2009. At March 31, 2010, the Company had total assets of $100.017 million against $149.655 million in total liabilities, resulting in stockholders' deficit of $49.638 million. The Company had cash and cash equivalents of $7.7 million as of March 31, 2010, compared to cash and cash equivalents of $7.8 million as of December 31, 2009. The Company's outstanding debt balance was $136.5 million at March 31, 2010, compared to $138.2 million at December 31, 2009. Kenneth J. Hall, Chief Executive Officer of NexCen Brands, stated, "While our revenues reflect continued weakness in the macro environment, we continued to generate positive cash flow from operations. Additionally, the cost reduction efforts that we implemented in 2009 resulted in our operating income being relatively flat as compared to the prior year. With that said, exploring alternatives to our capital and debt structure remained our priority throughout the quarter and we are pleased to have recently signed an agreement to sell our franchising business. The agreement allows us to address our current debt and capital structure in a manner we believe is most favorable for all of our stakeholders." A full-text copy of the Company's earnings release is available at no charge at http://ResearchArchives.com/t/s?62ab A full-text copy of the Company's Form 10-Q report is available at no charge at http://ResearchArchives.com/t/s?62ab In its March 2010 Form 10-Q Report, the Company said its financial condition and liquidity as of March 31, 2010 raise substantial doubt about its ability to continue as a going concern. The Company remains highly leveraged; it has no additional borrowing capacity under its Credit Facility with BTMUCC; and the BTMUCC Credit Facility imposes restrictions on its ability to freely access the capital markets. The BTMUCC Credit Facility also imposes various restrictions on the cash the Company generates from operations. The Company is subject to numerous prevailing economic conditions and to financial, business, and other factors beyond its control. In addition, the Company's scheduled principal payments under the BTMUCC Credit Facility include a final principal payment on its Class B Franchise Note of $34.5 million in July 2011. The Company does not expect that it will be able to meet this obligation. To date, the Company has received waivers or amendments from BTMUCC, including reduction of interest rates, deferral of scheduled principal payment obligations and certain interest payments, waiver and extension of time related to the obligations to issue dilutive warrants, allowance of certain payments to be excluded from debt service obligations, as well as relief from debt coverage ratio requirements, certain capital and operating expenditure limits, certain loan-to-value ratio requirements, certain free cash flow margin requirements and the requirement to provide financial statements by certain deadlines. The Company anticipates that, absent further waivers and amendments, it will breach certain covenants under the BTMUCC Credit Facility in 2010. Accordingly, the Company has classified all of the debt outstanding under the BTMUCC Credit Facility as a current liability as of March 31, 2010 and December 31, 2009. If the Company fails to meet debt service obligations or otherwise fail to comply with the financial and other restrictive covenants, it would default under its BTMUCC Credit Facility, which could then trigger, among other things, BTMUCC's right to accelerate all payment obligations, foreclose on virtually all of the assets of the Company and take control of all of the Company's cash flow from operations. In November 2009, the Company retained an investment bank to assist in identifying and evaluating alternatives to the Company's current debt and capital structure, including recapitalization of the Company, restructuring of its debt or sale of some or substantially all of its assets. On May 13, 2010, NexCen entered into an agreement to sell its franchise business (which includes all of the brands it currently manages) to an affiliate of Levine Leichtman Capital Partners, an independent investment firm, for $112.5 million, subject to certain closing adjustments. NexCen entered into an agreement with BTMUCC, under which BTMUCC will accept a portion of the sale proceeds, at the closing of the sale transaction, in full satisfaction of the outstanding indebtedness owed to BTMUCC. NexCen also entered into an amendment and waiver agreement with BTMUCC, which includes certain limited waivers of covenants and obligations in the BTMUCC Credit Facility to facilitate the completion of, and assist NexCen in remaining in compliance with the BTMUCC Credit Facility pending completion of, the sale transaction. Additional discussion on the deal is available at no charge at http://ResearchArchives.com/t/s?62ac NEXPAK CORP: Wins Confirmation of Liquidating Plan -------------------------------------------------- Bill Rochelle at Bloomberg News reports that NexPak Corp. received approval of its liquidating Chapter 11 plan. As modified just before confirmation, a settlement with the secured lenders carved out $150,000 cash to pay expenses of the Chapter 11 case, with anything left for distribution to the holders of $7.5 million in unsecured claims. Lenders' liens will remain on unsold assets, including a non-bankrupt affiliate in the Netherlands that had positive cash flow when the disclosure statement was approved. The banks waived unsecured claims resulting from the shortfall in the collateral NexPak pledged. About Nexpak Corp. Headquartered in Duluth, Georgia, Nexpak Corporation -- http://www.nexpak.com/-- manufactures and supplies packaging for DVD, CD, video, audio, and professional media formats. The Company and its debtor-affiliates filed for Chapter 11 protection on April 10, 2009 (Bankr. D. Del. Lead Case No. 09-11244). William A. Hazeltine, Esq., at Sullivan Hazeltine Allinson LLC represents the Debtors in their restructuring efforts. The Debtors assets range from $10 million to $50 million and its debts from $100 million to $500 million. This is the second filing by NexPak. NexPak carried out a so-called prepackaged bankruptcy reorganization in December 2004 where Highland Capital Management LP and affiliates ended up as controlling shareholders by exchanging debt for equity. The business consistently missed financial projections since emerging from the reorganization. At a bankruptcy court-sanctioned auction in 2009, the domestic assets went to a bidder who made a $1.5 million offer. NIC BANK: Fitch Affirms Long-Term IDR at 'B-' with Stable Outlook ----------------------------------------------------------------- Fitch Ratings has affirmed NIC Bank Limited's (NIC) ratings at Long-term Issuer Default (IDR) 'B-' with a Stable Outlook, Short- term IDR 'B', Individual 'D', Support '5' and Support Rating Floor 'NF'. Simultaneously, the agency has withdrawn NIC's ratings and will no longer provide rating coverage for this issuer. OCWEN FINANCIAL: Fitch Affirms IDR at 'B+'; Outlook Stable ---------------------------------------------------------- Fitch Ratings has affirmed the long-term Issuer Default Rating (IDR) of Ocwen Financial Corp. (Ocwen) at 'B+' and the short-term IDR at 'B'. The Rating Outlook is Stable. The rating affirmations reflect Ocwen's stable operating and funding profile as well as its capable loss mitigation capabilities in the subprime arena and significant cost advantages. The company has improved access to advance financing capacity by renewing and increasing the size of facilities. Ocwen also completed a secondary offering in August 2009 which, generated net proceeds of $274 million and improved its equity position and leverage profile. Additionally, the company had also raised net cash of $49 million in a private placement in April 2009. Fitch views access to capital markets to raise equity positively. The Stable Outlook is supported by Ocwen's ability to generate a reliable earnings stream and stable operating cash flows consistent with the rating level. Fitch expects that Ocwen's current cash position will allow the company to add volume and fund additional MSR purchases if needed. Fitch believes that near-term demand for subprime and special serving will remain firm with potential upside from third party sources. In addition, the company is well positioned to benefit from programs such as the governments 'Home Affordable Modification Plan', which is expected to generate incremental revenue for Ocwen. As a low cost servicer for subprime and high risk assets, Fitch believes that while Ocwen's expertise will remain in demand for the near future, the company's performance may come under pressure in the longer term as the subprime share of the mortgage market shrinks in line with a broader economic recovery. ORLEANS HOMEBUILDERS: Cancels Sale Deal, Pursues Reorganization --------------------------------------------------------------- Orleans Homebuilders, Inc., said that its recent discussions with its senior lending group have resulted in an agreement to pursue negotiation of a plan of reorganization with the support of the Company's senior lending group. As a result, the Company has terminated the previously announced Asset Purchase Agreement with NVR, Inc. Additionally, the Company has cancelled the hearing scheduled for May 21, 2010, in the United States Bankruptcy Court for the District of Delaware on its motion for, among other things, establishment of bidding procedures with respect to the purchase of substantially all of the assets of the Company. Orleans currently anticipates that it will file a plan of reorganization with the Court in late summer and would hope to emerge from bankruptcy in late fall. The Company emphasizes that there can be no assurances as to the timing, contents or the outcome of any plan of reorganization or the Company's potential emergence from bankruptcy. Mitchell B. Arden, a managing director and shareholder of Phoenix Management who has been serving as Orleans' Chief Restructuring Officer since March 4, 2010, stated: "Over the past several weeks, the Company has been in active dialogue with a number of parties regarding its strategic options. It is clear from these discussions that pursuing a plan of reorganization appears to be the best course of action for the Company and its constituents. As part of this process, and before we prepare and file the Company's plan, we believe that we will be able to restart homebuilding even for those units under contract on which construction has not yet begun. At the same time, we should be able to reinitiate sales and marketing efforts on new homes. This is a significant step forward for our many customers and contractors who have been waiting patiently for the Company to move in this direction. We hope to have the necessary financial support to undertake these new construction and sales efforts in a few weeks. "The option to pursue a plan of reorganization means that the Orleans name and its operations may be preserved for the benefit of our people and the communities in which we work. We appreciate the on-going support of our lenders, employees, customers, vendors and contractors. Their collective willingness to work with us during this critical time has provided us with the opportunity to pursue a plan that better suits the needs and interests of all parties. The details of the reorganization will be developed as we continue to work with our creditors. On a personal note, I wish to express my gratitude to the Company's bankruptcy counsel, Cahill Gordon & Reindel LLP, as well as corporate counsel from Blank Rome LLP, all of whom have worked tirelessly to help us define this renewed direction for Orleans." About Orleans Homebuilders Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in these 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). Cahill Gordon & Reindell LLP is the Debtor's bankruptcy and restructuring counsel. Curtis S. Miller, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, are the Debtor's Delaware and restructuring counsel. Blank Rome LLP is the Debtor's special corporate counsel. Garden City Group Inc. is the Debtor's claims and notice agent. The Company estimated assets and debts at $100,000,001 to $500,000,000. OXBOW CARBON: S&P Changes Outlook of 'BB-' Corporate to Positive ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on West Palm Beach, Fla.-based Oxbow Carbon LLC to positive from stable. S&P said, "At the same time, we affirmed the 'BB-' corporate credit rating on the company. In addition, we raised our issue- level rating on the company's senior secured term loan due 2014 to 'BB+' (two notches above the corporate credit rating) from 'BB'. The recovery rating was revised to '1', indicating our expectation of very high (90%-100%) recovery in the event of a payment default, from '2'. The revised rating reflects the significant debt repayment over the past several quarters. "The outlook revision reflects the combination of the company's steady debt reduction and better-than-expected operating performance in the first quarter, a trend that may continue in the near term given the strong performance from the company's U.S. coal mining business," said Standard & Poor's credit analyst Sherwin Brandford. "We believe Oxbow can potentially maintain credit metrics at a level we would consider good for the 'BB-' rating, given the company's fair business risk profile, with leverage remaining below 3.5x," said S&P. "Still, we expect second-quarter performance to weaken, primarily as a result of a scheduled longwall move at the company's sole U.S. coal mine. The move, which is scheduled to begin in May and take about eight weeks, will result in a significant reduction in coal volume over that period. In addition, in our view, if the move takes longer than expected, resulting in a prolonged period of weaker earnings, the company's ability to maintain credit metrics around expected levels is uncertain. In the event the longwall move proceeds as expected, in terms of timing and earnings impact, and operating performance is in line with our expectations, we could raise the rating as 2010 progresses since the company's overall financial profile would be more consistent with a higher rating," said S&P. PAETEC HOLDING: Posts $9.5-Mil. Net Loss for March 31 Quarter ------------------------------------------------------------- PAETEC Holding Corp. filed its quarterly report Form 10-Q, showing a net loss of $9.5 million on $390.0 million of total revenue for the three months ended March 31, 2010, compared with a net loss of $3.3 million on $399.2 million total revenues during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $1.4 billion in total assets and $1.2 billion in total liabilities, for a stockholders' equity of $191.9 million. Liquidity and Capital Resources PAETEC finances its operations and growth primarily with cash flow from operations, issuances of debt securities, and other loans, operating leases and normal trade credit terms. The $3.3 million decrease in cash flows from operating activities for the 2010 quarter over the 2009 quarter was primarily attributable to a $4.1 million decrease in net income adjusted for non-cash items which was partially offset by a $0.8 million increase in working capital. PAETEC's investing activities during the 2010 and 2009 quarters consisted primarily of activities related to the purchase and installation of property and equipment. Investing activities during the 2010 quarter also included the acquisition of U.S. Energy Partners LLC. According to the company, net cash provided by financing activities of $18.6 million for the 2010 quarter was primarily related to the issuance and sale of $300.0 million in aggregate principal amount of its 8 7/8% senior secured notes due 2017, partially offset by the payment of debt issuance costs incurred in connection with such sale. PAETEC applied a portion of the proceeds from the January 2010 sale of the 8 7/8% senior secured notes to repay $240.2 million in aggregate principal amount of term loans and $30.0 million in aggregate principal of revolving loans outstanding under its senior secured credit facilities. Net cash used in financing activities of $2.5 million for the 2009 quarter was primarily related to repayments on long-term debt and expenditures under PAETEC's stock repurchase program. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a4 About PAETEC Holding PAETEC Holding Corp., through its subsidiaries, provides integrated communications services, including local and long distance voice, data, and broadband Internet access services, primarily to business and institutional customers. On February 8, 2008, PAETEC Holding completed its combination by merger with McLeodUSA Incorporated, which became a wholly owned subsidiary of PAETEC Holding upon completion of the merger. Effective on June 1, 2009, the Company entered into a Second Amendment and Waiver to its Credit Agreement with its lenders which amends the Credit Agreement, dated as of February 28, 2007, and amended as of June 27, 2007. The Amendment grants the Company the right, at its option and subject to specified conditions, voluntarily to prepay term loans outstanding under its term loan facilities at any time and from time to time during a period beginning on the effective date of the Amendment and ending 18 months after such effective date. The total cash payments to be made by the Company in connection with such voluntary prepayments may not exceed $100,000,000, excluding amounts applied to the payment of accrued and unpaid interest and fees. The Amendment also modifies some of the restrictive covenants in the Credit Agreement primarily to permit the Company to issue senior secured notes and to allow the Company and its subsidiaries to incur indebtedness and related obligations under such notes if specified conditions are satisfied. * * * As reported by the Troubled Company Reporter on June 18, 2009, Standard & Poor's Ratings Services assigned PAETEC Holding's proposed senior secured notes due 2017 an issue-level rating of 'B' (the same as the corporate credit rating) with a recovery rating of '3', indicating expectations for meaningful (50%-70%) recovery in the event of payment default. At the same time, S&P affirmed all other ratings on PAETEC, including the 'B' corporate credit rating. The outlook is stable. Moody's Investors Service assigned a B1 rating to the senior secured note issuance. Moody's affirmed all other ratings, including the SGL-1 liquidity rating. The rating outlook remains stable. PAUL JARCHOW: Case Summary & 5 Largest Unsecured Creditors ---------------------------------------------------------- Joint Debtors: Paul M. Jarchow Maribel L. Jarchow 6733 Breakers Way Ventura, CA 93001 Bankruptcy Case No.: 10-12416 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Central District Of California (Santa Barbara) Judge: Robin Riblet Debtor's Counsel: Debra C. Young, Esq. 4535 Oak Glen Dr Unit E Santa Barbara, CA 93110 Tel: (805) 403-2213 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 5 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-12416.pdf The petition was signed by Paul M. Jarchow and Maribel L. Jarchow. PAUL TRANSPORTATION: Files for Chapter 11 in Oklahoma City ---------------------------------------------------------- Paul Transportation Inc., a trucking fleet with more than 300 tractors and over 500 trailers, filed a Chapter 11 petition on May 18 in Oklahoma City (Bankr. W.D. Oklahoma Case No. 10-13022). Enid, Oklahoma-based Paul Transportation said assets and debt are both between $10 million and $50 million. PRO BRANDS: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Pro Brands, LLC dba Vetgate Global 12136 Highland Road Highland, IL 62249 Bankruptcy Case No.: 10-31294 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Southern District of Illinois (East St Louis) Judge: Laura K. Grandy Debtor's Counsel: Robert G. Lathram, Esq. Lathram and Herbert LLP 203 W Main St Collinsville, IL 62234 Tel: (618) 345-4600 Fax: (618) 345-4603 E-mail: glathram@bankruptcylawyers-metroeast.com Scheduled Assets: $1,652,005 Scheduled Debts: $1,205,057 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ilsb10-31294.pdf The petition was signed by Jay R. Brown, manager. PETER LORD: Case Summary & 16 Largest Unsecured Creditors --------------------------------------------------------- Joint Debtors: Peter S. Lord Laurie A. Lord 718 Mount Alban Drive Annapolis, MD 21409 Bankruptcy Case No.: 10-21052 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court District of Maryland (Baltimore) Debtor's Counsel: Timothy J. Mummert, Esq. Timothy J. Mummert, P.A. 808 Landmark Drive, Suite 223A Glen Burnie, MD 21061 Tel: (410) 766-1100 E-mail: timothy@mummertlaw.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Joint Debtors' list of 16 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mdb10-21052.pdf The petition was signed by the Joint Debtors. PRIME GROUP: Files Form 25 to Delist Series B Preferred Shares -------------------------------------------------------------- Prime Group Realty Trust filed with the Securities and Exchange Commission a Form 25 to remove from listing its 9% Series B Cumulative Redeemable Preferred Shares. As reported by the Troubled Company Reporter on May 7, 2010, Prime Group Realty Trust delivered notice to the New York Stock Exchange requesting to voluntarily delist its 9% Series B Cumulative Redeemable Preferred Shares from the NYSE. After voluntarily delisting the Series B Preferred Shares from the NYSE, the Company expects that the trading of the Series B Preferred Shares will be reported on the OTCQB for so long as it remains a voluntary filer and thereafter in the Pink Sheets with Pink OTC Markets Inc. The Company's Board of Trustees has approved the delisting from the NYSE and deregistration of the Series B Preferred Shares under the Exchange Act in order to save significant costs associated with compliance with these regulatory provisions. The TCR also said that in June 2008 the Company instituted a retention and severance program for certain employees, including four of the Company's officers who were named executive officers in the Company's Form 10-K. The Existing Retention Plan was effective for a two-year period and accordingly was scheduled to expire in June 2010. On April 30, 2010, the Company instituted an updated retention plan that replaced and extended the existing retention plan. The revised retention program was developed in consultation with FPL Associates, L.P., a leading compensation consulting firm, who the Company engaged as its independent compensation consultant. The Company did not pay annual bonuses to its employees for calendar year 2009 and only paid partial bonuses to its employees for calendar year 2008 and the retention plan was extended and replaced in an effort to retain key personnel in light of the foregoing and in light of other factors affecting the Company. About Prime Group Realty Trust Based in Chicago, Illinois, Prime Group Realty Trust (NYSE: PGEPRB) -- http://www.pgrt.com/-- is a fully-integrated, self- administered, and self-managed real estate investment trust which owns, manages, leases, develops, and redevelops office and industrial real estate, primarily in metropolitan Chicago. The Company currently owns 7 office properties containing an aggregate of roughly 3.2 million net rentable square feet and a joint venture interest in one office property comprised of roughly 101,000 net rentable square feet. The Company leases and manages roughly 3.2 million square feet comprising all of its wholly owned properties. In addition, the Company is the asset and development manager for an roughly 1.1 million square foot office building located at 1407 Broadway Avenue in New York. * * * As reported by the Troubled Company Reporter on December 15, 2009, Prime Group Realty Trust said the Company's Board of Trustees has determined not to declare a quarterly distribution on its Series B Preferred Shares for the fourth quarter of 2009, and that the Board is unable to determine when the Company might recommence distributions on the Series B Preferred Shares. PRIME GROUP: Posts $100,000 Q1 Net Loss, Mulls Asset Sales ---------------------------------------------------------- Prime Group Realty Trust said net loss available to common shareholders was $100,000 or $0.29 per share for the first quarter ended March 31, 2010, as compared to net loss attributable to common shareholders of $4.5 million or $19.01 per share for the first quarter of 2009. The results of the Company's operations compared to the first quarter of 2009 were positively affected by a decrease of $4.4 million in total interest expense related to the assignment of our membership in BHAC Capital IV, L.L.C. and related loan in the third quarter of 2009. The Company's investment in BHAC was wholly-owned by the Company and not its Operating Partnership. On March 10, 2010, the Company announced that its Board determined not to declare a quarterly distribution on its Series B Preferred Shares for the first quarter of 2010 and that the Board was unable to determine when the Company will recommence distributions on the Series B Preferred Shares. The total arrearage in payment of dividends on the Series B Preferred Shares is $11.25 million. The Board is also in the process of considering various financing, capitalization, asset sales and other alternatives for the Company. The Board based their decision on the Company's current capital resources and liquidity needs and the overall negative state of the economy and capital markets. The Board intends to review the suspension of the Series B Preferred Shares dividends periodically based on the Board's ongoing review of the Company's financial results, capital resources, liquidity needs, and the condition of the economy and capital markets. The Company can give no assurances that dividends on the Company's Series B Preferred Shares will be resumed, or that any financing or other capitalization alternatives will be satisfactorily concluded. At March 31, 2010, the Company had total assets of $379.711 million against total liabilities of $381.433 million and non- controlling interest of $87.513 million, resulting in total deficit of $1.722 million. A full-text copy of the Company's Form 10-Q is available at no charge at http://ResearchArchives.com/t/s?62b2 A full-text copy of the Company's earnings release is available at no charge at http://ResearchArchives.com/t/s?62b3 About Prime Group Realty Trust Based in Chicago, Illinois, Prime Group Realty Trust (NYSE: PGEPRB) -- http://www.pgrt.com/-- is a fully-integrated, self- administered, and self-managed real estate investment trust which owns, manages, leases, develops, and redevelops office and industrial real estate, primarily in metropolitan Chicago. The Company currently owns 7 office properties containing an aggregate of roughly 3.2 million net rentable square feet and a joint venture interest in one office property comprised of roughly 101,000 net rentable square feet. The Company leases and manages roughly 3.2 million square feet comprising all of its wholly owned properties. In addition, the Company is the asset and development manager for an roughly 1.1 million square foot office building located at 1407 Broadway Avenue in New York. * * * As reported by the Troubled Company Reporter on December 15, 2009, Prime Group Realty Trust said the Company's Board of Trustees has determined not to declare a quarterly distribution on its Series B Preferred Shares for the fourth quarter of 2009, and that the Board is unable to determine when the Company might recommence distributions on the Series B Preferred Shares. PROTECTION ONE: Reports $4.8 Million Net Loss for March 31 Qtr -------------------------------------------------------------- Protection One, Inc., reported a net loss of $(4.8) million or $(0.19) per share for the first quarter ended March 31, 2010, compared to a net loss of $(2.8) million or $(0.11) per share in the prior year. Lower operating income, an increase in non-cash amortization of debt discount as a result of the amendment to the Company's senior credit facility in the fourth quarter of 2009, and income tax expense contributed to the decrease. Revenue in the first quarter of 2010 decreased 5% to $88.3 million from $93.0 million. Monitoring and related services revenue decreased due to lower Wholesale monitoring revenue, because as of November 1, 2009, the Company no longer provides monitoring services to one of the unit's largest customers. Lower Retail and Multifamily average customer bases and related RMR also contributed to the decrease. The Company's focus on the commercial market resulted in an increase in equipment sales, which is reflected in installation and other revenue. Monitoring and related services margin improved to 69.8% in the first quarter of 2010 from 69.2% in the same period in 2009 primarily due to a reduction in lower margin Wholesale monitoring and related services revenue. Operating income in the first quarter of 2010 decreased approximately $0.7 million to $7.8 million from $8.5 million in 2009 because the Company recorded a $2.1 million loss in the first quarter of 2010 in connection with the termination of a lease agreement and write-off of the related leasehold improvements. Excluding these expenses, decreases in costs of monitoring and related services, selling expense and amortization and depreciation expense more than offset lower monitoring and related services revenue. Richard Ginsburg, Protection One's president and chief executive officer, said, "We began the year with a quarter that showed continued progress in managing costs, lowering net debt, and reducing attrition. We executed well in all three business units this quarter with our continued focus on making sure we deliver the best customer experience while maintaining financial discipline." As of March 31, 2010, the Company had total assets of $562.853 million against total liabilities of $624.631 million, resulting in stockholders' deficit of $61.778 million. A full-text copy of the Company's earnings release is available at no charge at http://ResearchArchives.com/t/s?62b4 A full-text copy of the Company's Form 10-Q report is available at no charge at http://ResearchArchives.com/t/s?62b5 Merger Deal As reported by the Troubled Company Reporter on April 29, 2010, Protection One has entered into a definitive agreement to be acquired by affiliates of GTCR, a private equity firm that manages more than $8 billion in equity capital. Protection Acquisition Sub, Inc., has agreed to commence a tender offer to acquire all of POI's outstanding shares of Common Stock, for $15.50 per share to the seller in cash, net of applicable withholdings and without interest. Affiliates of Quadrangle Group LLC and Monarch Capital Partners, which together own over 60% of the fully diluted shares of Protection One, have each executed a tender and support agreement pursuant to which they have agreed to validly tender their shares in the tender offer. Protection One's financial advisor in the transaction is J.P. Morgan Securities Inc. and its legal advisor is Kirkland & Ellis LLP. Lazard Freres & Co. LLC advised Protection One's board of directors and its independent transactions committee with respect to the fairness of the offer price to be paid in the transaction. Morgan Keegan & Company, Inc. and Barclays Capital served as M&A advisors and Barnes Associates served as an industry advisor to GTCR. Latham & Watkins LLP and Skadden, Arps, Slate, Meagher & Flom LLP provided GTCR legal counsel. About GTCR Founded in 1980, GTCR -- http://www.gtcr.com/-- is a private equity firm focused on investing in growth companies in the Financial Services & Technology, Healthcare and Information Services & Technology industries. The Chicago-based firm pioneered the "Leaders Strategy" -- finding and partnering with world-class leaders as the critical first step in identifying, acquiring and building market-leading companies through acquisitions and organic growth. Since its inception, GTCR has invested more than $8.0 billion in over 200 companies. About Protection One Protection One, Inc. -- http://www.ProtectionOne.com/-- is principally engaged in the business of providing security alarm monitoring services, including sales, installation and related servicing of security alarm systems for residential and business customers. The Company also provides monitoring and support services to independent security alarm dealers on a wholesale basis. Affiliates of Quadrangle Group LLC and Monarch Alternative Capital LP own roughly 70% of the Company's common stock. PROTECTION ONE: Lawsuits Filed Against GTCR Transaction ------------------------------------------------------- Donald Rensch, a purported stockholder of Protection One, Inc., on May 6, 2010, filed a complaint on behalf of himself and as a putative class action on behalf of Protection One's public stockholders against the Company, the GTCR entities, the Company's board, and certain major shareholders in the Court of Chancery of the State of Delaware. The Company has struck a deal to be acquired by Protection Acquisition Sub, Inc., as Purchaser, a wholly owned indirect subsidiary of Protection Holdings, LLC, as Parent, which is controlled by (i) GTCR Fund IX/A, L.P.; (ii) GTCR Fund IX/B, L.P.; (iii) GTCR Partners IX, L.P. Quadrangle Group LLC, and Monarch Alternative Capital LP have agreed to the deal. The complaint alleges, among other things, that the defendants breached fiduciary duties or aided and abetted the alleged breach of fiduciary duties in connection with the Offer and the Merger contemplated by the Merger Agreement and alleges that the disclosures contained in Protection One's Schedule 14D-9 and the Offer to Purchase are materially misleading and omit material facts. The complaint does not state how many Shares are purportedly held by Donald Rensch. The complaint seeks, among other things, a declaration that the action brought by the complaint is properly maintainable as a class action, an order enjoining the transactions contemplated by the Merger Agreement, a declaration that the defendants have breached fiduciary duties, including in connection with the approval of certain incentive awards, award of damages to the plaintiff and other members of the class, and award of the plaintiff's costs, including attorneys' and experts' fees. Purchaser, Parent and GTCR believe that the Rensch Complaint is wholly without merit and intend to defend the case vigorously. On May 10, 2010, Trading Strategies Fund, a purported stockholder of Protection One, filed a complaint on behalf of itself and as a putative class action on behalf of Protection One's public stockholders, against GTCR Golder Rauner, LLC, Protection One, and each member of the Protection One board of directors in the district court of Douglas County, Kansas. The complaint alleges, among other things, that the defendants breached fiduciary duties or aided and abetted the alleged breach of fiduciary duties in connection with the Offer and the Merger contemplated by the Merger Agreement and alleges that the disclosures contained in Protection One's Schedule 14D-9 are materially misleading and omit material facts. The complaint does not state how many Shares are purportedly held by Trading Strategies Fund. The complaint seeks, among other things, a judgment determining that the action brought by the complaint is properly maintainable as a class action, a declaration that the defendants have breached fiduciary duties or aided and abetted in the breach of fiduciary duties, award of damages to the plaintiff and other members of the class, and award of the plaintiff's costs, including attorneys' and experts' fees. On May 14, 2010, the district court of Douglas County, Kansas granted a motion to enter a temporary restraining order preventing the parties from completing the Offer and the Merger prior to June 2, 2010, and a hearing in such court in respect of a preliminary injunction against the completion of the Offer and the Merger has been scheduled for May 27, 2010. GTCR Golder Rauner, LLC, an affiliate of GTCR, believes that the TSF Complaint is wholly without merit and intends to defend the case vigorously. On May 12, 2010, The Law Offices of Mark Kotlarsky Pension Plan, a purported stockholder of Protection One, filed a complaint on behalf of itself and as a putative class action on behalf of Protection One's public stockholders against Purchaser, Parent, GTCR, Protection One, each member of the Protection One board of directors, Quadrangle Group LLC, Quadrangle, and Monarch Alternative Capital LP in the Court of Chancery of the State of Delaware. The complaint alleges, among other things, that the defendants breached their fiduciary duties or aided and abetted the alleged breach of fiduciary duties in connection with the Offer and the Merger contemplated by the Merger Agreement and alleges that the disclosures contained in Protection One's Schedule 14D-9 are materially misleading and omit material facts. The complaint does not state how many Shares are purportedly held by The Law Offices of Mark Kotlarsky Pension Plan. The complaint seeks, among other things, an order enjoining the transactions contemplated by the Merger Agreement, a declaration that the defendants have breached fiduciary duties, and award of the plaintiff's costs, including attorneys' and experts' fees. Purchaser, Parent and GTCR believe that the Kotlarsky Complaint is wholly without merit and intend to defend the case vigorously. Merger Deal As reported by the Troubled Company Reporter on April 29, 2010, Protection One has entered into a definitive agreement to be acquired by affiliates of GTCR, a private equity firm that manages more than $8 billion in equity capital. Protection Acquisition Sub, Inc., has agreed to commence a tender offer to acquire all of POI's outstanding shares of Common Stock, for $15.50 per share to the seller in cash, net of applicable withholdings and without interest. Affiliates of Quadrangle Group LLC and Monarch Capital Partners, which together own over 60% of the fully diluted shares of Protection One, have each executed a tender and support agreement pursuant to which they have agreed to validly tender their shares in the tender offer. Protection One's financial advisor in the transaction is J.P. Morgan Securities Inc. and its legal advisor is Kirkland & Ellis LLP. Lazard Freres & Co. LLC advised Protection One's board of directors and its independent transactions committee with respect to the fairness of the offer price to be paid in the transaction. Morgan Keegan & Company, Inc. and Barclays Capital served as M&A advisors and Barnes Associates served as an industry advisor to GTCR. Latham & Watkins LLP and Skadden, Arps, Slate, Meagher & Flom LLP provided GTCR legal counsel. About GTCR Founded in 1980, GTCR -- http://www.gtcr.com/-- is a private equity firm focused on investing in growth companies in the Financial Services & Technology, Healthcare and Information Services & Technology industries. The Chicago-based firm pioneered the "Leaders Strategy" -- finding and partnering with world-class leaders as the critical first step in identifying, acquiring and building market-leading companies through acquisitions and organic growth. Since its inception, GTCR has invested more than $8.0 billion in over 200 companies. About Protection One Protection One, Inc. -- http://www.ProtectionOne.com/-- is principally engaged in the business of providing security alarm monitoring services, including sales, installation and related servicing of security alarm systems for residential and business customers. The Company also provides monitoring and support services to independent security alarm dealers on a wholesale basis. Affiliates of Quadrangle Group LLC and Monarch Alternative Capital LP own roughly 70% of the Company's common stock. As of March 31, 2010, the Company had total assets of $562.853 million against total liabilities of $624.631 million, resulting in stockholders' deficit of $61.778 million. RICARDO ORTEGA: Case Summary & 15 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Ricardo Lopez Ortega aka Ricardo Ortega 2228 Pajaro St Oxnard, CA 93030 Bankruptcy Case No.: 10-12424 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Central District Of California (Santa Barbara) Judge: Robin Riblet Debtor's Counsel: Philip D. Dapeer, Esq. Philip Daoeer, a Law Corporation 2625 Townsgate Rd Ste 330 Westlake Village, CA 91361 Tel: (323) 954-9144 Fax: (323) 954-0457 Scheduled Assets: $1,873,000 Scheduled Debts: $2,991,979 A list of the Company's 15 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-12424.pdf The petition was signed by Ricardo Lopez Ortega. RICHARD HOYLE: Case Summary & 18 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Richard W. Hoyle 80 Cottonwood Court #C-150 Eagle, ID 83616 Bankruptcy Case No.: 10-01484 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court District of Idaho (Boise) Judge: Terry L. Myers Debtor's Counsel: D Blair Clark, Esq. 1513 Tyrell Lane, Suite 130 Boise, ID 83706 Tel: (208) 475-2050 Fax: (208) 475-2055 E-mail: dbc@dbclarklaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 18 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/idb10-01484.pdf The petition was signed by Richard W. Hoyle. RIVIERA HOLDINGS: May File for Chapter 11 Absent Refinancing ------------------------------------------------------------ Riviera Holdings Corporation, owner of casinos in Las Vegas and Colorado, says that it may be forced to seek Chapter 11 protection if it fails to complete a refinancing or consensual out-of-court restructuring. The Company made the disclosure in its Form 10-Q for the quarter ended March 31, 2010. In the report, the Company disclosed assets of $199,175,000 against debts of $286,700,000 as of March 31, 2010. The Company also disclosed a net loss of $4,532,000 on net revenues of $30,814,000 for three months ended March 31, 2010, compared with a net loss of $1,037,000 on net revenues of $34,656,000 during the same period in 2009. On June 8, 2007, RHC and its restricted subsidiaries entered into a $245 million Credit Agreement with Wachovia Bank, National Association, as administrative agent. Cantor Fitzgerald Securities succeeded Wachovia as administrative agent effective April 12, 2010. The Credit Facility includes a $225 million seven-year term loan which has no amortization for the first three years, a one percent amortization for years four through six, and a full payoff in year seven, in addition to an annual mandatory pay down during the term of 50% of excess cash flows, as defined therein. The Credit Facility also includes a $20 million five-year revolving credit facility under which RHC could obtain extensions of credit in the form of cash loans or standby letters of credit. The Company is currently not in compliance with certain affirmative and negative covenants including its obligation to make payments under the Credit Facility. With the aid of financial advisors and outside counsel, the Company is continuing to negotiate with its various creditor constituencies to refinance or restructure its debt. "There is no assurance that the Company will be successful in completing a refinancing or consensual out-of-court restructuring and if it is unable to do so, the Company will likely be compelled to seek protection under Chapter 11 of the U. S. Bankruptcy Code. The conditions and events described raise substantial doubt about the Company's ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern." The Company's independent registered public accounting firm included an explanatory paragraph that expressed doubt as to the Company's ability to continue as a going concern in their audit report contained in its Form 10-K report for the year ended December 31, 2009. A copy of the Form 10-Q is available for free at: http://researcharchives.com/t/s?62bf About Riviera Holdings Las Vegas, Nevada-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. 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. ROBERT LOCKWOOD: Files for Chapter 11 Bankruptcy Protection ----------------------------------------------------------- Business turnaround specialist Robert Lockwood filed for Chapter 11 bankruptcy protection, listing assets of $100,000 to $500,000, and liabilities of between $1 billion and $10 million, Gloucester Times reports. aniel Briansky, Esq., represents Mr. Lockwood. According to Gloucester Times, state tax collectors have been chasing Mr. Lockwood for roughly 20 years over a disputed tax bill that now stands around $2.4 million, placing him fifth on the list of the state's biggest business tax delinquents. Tax collectors have started seizing assets they believe are controlled secretly by Mr. Lockwood -- including the Harbor House liquor license -- in order to draw down the bill. Authorities seized the Harbor House license last fall. ROBERT ROLLINS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Joint Debtors: Robert M. Rollins aka Mike Rollins Roxane L. Rollins 15220 Molly Anne Ct. Valley Center, CA 92082 Bankruptcy Case No.: 10-08358 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Southern District of California (San Diego) Judge: Margaret M. Mann Debtor's Counsel: Link W. Schrader, Esq. Law Office of Link W. Schrader P.O. Box 46368 Los Angeles, CA 90046 Tel: (619) 952-8342 Fax: (310) 878-4158 E-mail: link@link-schrader.com Scheduled Assets: $1,560,070 Scheduled Debts: $1,809,051 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/casb10-08358.pdf The petition was signed by Robert M. Rollins and Roxane L. Rollins. SAINT VINCENT: Sets Procedures for 6th Avenue Staff House Sale -------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that St. Vincent Catholic Medical Centers received approval to auction off its residential building at 555 6th Avenue in New York. The property, commonly known as Staff House, housed 160 doctors serving their residencies at St. Vincent. According to the report, under the court-approved procedures, Taconic Investment Partners LLC will make the first bid with $48 million cash. Other bids are due June 15. The hospital will negotiate with prospective buyers who make competing bids and require final bids by June 25. St. Vincent will announce the highest or best offer on June 28 and hold a hearing on July 1 for approval of the sale. Originally, St. Vincent wanted competing offers by May 27. Bloomberg News reports that the Bankruptcy Court also approved the sale of St. Vincent's Pax Christi hospice to Visiting Nurse Service of New York Hospice Care for $9 million plus assumption of specified liabilities. About Saint Vincents Catholic Medical Centers St. Vincents Catholic Medical Centers returned to bankruptcy court by filing another Chapter 11 petition April 14, 2010, in New York (Bankr. S.D.N.Y. Case No. 10-11963). The new petition listed assets of $348 million against debt totaling $1.09 billion. Adam C. Rogoff, Esq., and Kenneth H. Eckstein, Esq., at Kramer Levin Naftalis & Frankel LLP, represent the Debtor in its restructuring efforts. Although the hospitals emerged from the prior reorganization in July 2007 with a Chapter 11 plan said to have a "a realistic chance" of paying all creditors in full, the bankruptcy left the medical center with more than $1 billion in debt. The new filing occurred after a $64 million operating loss in 2009 and the last potential buyer terminated discussions for taking over the flagship hospital. Saint Vincents Catholic Medical Centers -- http://www.svcmc.org/ -- is anchored by St. Vincent's Hospital Manhattan, an academic medical center located in Greenwich Village and the only emergency room on the Westside of Manhattan from Midtown to Tribeca, St. Vincent's Westchester, a behavioral health hospital in Westchester County, and continuing care services that include two skilled nursing facilities in Brooklyn, another on Staten Island, a hospice, and a home health agency serving the Metropolitan New York area. Saint Vincent Catholic Medical Centers of New York and six of its affiliates first filed for Chapter 11 protection on July 5, 2005 (Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). SEMGROUP LP: Oil & Gas Producers Sue Goldman, BP for Fraud ---------------------------------------------------------- More than 80 independent Kansas, Oklahoma and Texas oil and gas producers have filed lawsuits alleging that Goldman Sachs subsidiary J. Aron & Co. and British Petroleum subsidiary BP Oil Supply Company conspired with SemGroup to defraud them and convert millions of dollars worth of the producers' crude oil and gas that was delivered to SemGroup prior to the company's 2008 bankruptcy. In addition to BP and J. Aron, ConocoPhillips, Plains Marketing and numerous other oil and gas companies are named as defendants in lawsuits that were filed in Kansas and Oklahoma state courts. The lawsuits for the independent producer plaintiffs say they are owed millions of dollars for the crude oil and gas that the defendants took from SemGroup just as margin calls were rapidly driving the energy company toward its Chapter 11 filing in July 2008. "We believe the evidence will show that J. Aron deliberately took advantage of SemGroup's dire financial predicament when J. Aron took possession of our clients' oil and gas," says bankruptcy attorney Peter Goodman of McKool Smith, who represents the plaintiffs along with McKool Smith commercial litigator Kyle Lonergan. The complaints allege that Goldman Sachs and J. Aron exploited their multilayered relationship with SemGroup in which they were the company's investment banker, offering agent, lender, and trading partner to take possession of the independent producers' oil and gas in violation of numerous state laws of Kansas, Oklahoma, and Texas. The cases are Arrow Oil & Gas, Inc., et al. v. J. Aron & Company, et al., No. CJ-2010-239 and Arrow Oil & Gas, Inc., et al. v. Calcasieu Refining Company, et al., No. CJ-2010-240 filed in the District Court for Pottawatomie County, Oklahoma, and Anstine & Musgrove, Inc., et al. v. J. Aron & Company, et al., No. 2010 CN 35 and Anstine & Musgrove, Inc., et al. v. Calcasieu Refining Company, et al., No. 2010 CN 34 filed in the District Court for Pratt County, Kansas. McKool Smith is recognized as one of the premier trial law firms in the United States based on significant courtroom victories and substantial settlements for domestic and international clients. With more than 120 attorneys in Austin, Dallas, Houston, Marshall, New York, and Washington DC, the firm handles complex commercial litigation, intellectual property claims, bankruptcy matters, and white collar litigation for companies and individuals across the globe. McKool Smith has won more of the Top 100 Verdicts than any other law firm in the nation every year since 2008. For more information, contact Roger J. Cohen, 973 632 4694, or rcohen@autokthonous.com or Mike Androvett at 800-559-4534 or mike@androvett.com About SemGroup, L.P. SemGroup, L.P. -- http://www.semgrouplp.com/-- is a midstream service company that provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids and refined products. Services include purchasing, selling, processing, transporting, terminalling and storing energy. SemGroup serves customers in the United States, Canada, Mexico and Wales. SemGroup L.P. and its debtor-affiliates filed for Chapter 11 protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants L.L.C. is the Debtors' claims agent. The Debtors' financial advisors are The Blackstone Group L.P. and A.P. Services LLC. Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, represent the Debtors' prepetition lenders. SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude Company, sought protection under the Companies' Creditors Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc., is the appointed monitor of SemCanada Crude Company and its affiliates' reorganization proceedings before the Canadian Companies' Creditors Arrangement Act. The CCAA stay expires on November 21, 2008. SemGroup L.P.'s consolidated, unaudited financial conditions as of June 30, 2007, showed $5,429,038,000 in total assets and $5,033,214,000 in total debts. SemGroup, LP, won confirmation from the Bankruptcy Court of its Fourth Amended Plan of Reorganization on October 28, 2008. The Plan, which distributes more than $2.5 billion in value to its stakeholders, was declared effective November 30. SEVEN FALLS: Has 30 Days to Secure New Financing ------------------------------------------------ Mark Barret at Citizen-Times reports that a federal judge gave Seven Falls 30 days to arrange for new financing. A person familiar with the matter said the Company is in talks with a lender that could provide up to $7 million in financing. Seven Falls, LLC, has a golf course and residential development on 400 acres in Hendersonville, North Carolina. The Company filed for Chapter 11 bankruptcy protection on October 26, 2009 (Bankr. W.D. N.C. Case No. 09-11182). The Company listed $50,000,001 to $100,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. SECUREALERT INC: Extends Period for Purchase of Midwest's Interest ------------------------------------------------------------------ Securealert Inc. executed an agreement to extend the option period for the purchase of the remaining minority ownership interest of its subsidiary corporation, Midwest Monitoring & Surveillance, Inc. The agreement was entered into by the registrant and the minority shareholders of MM&S to extend the option period to March 31, 2011. As consideration for the extension of the option period for the additional 12 months, the registrant paid a fee by issuing 150,000 restricted shares of the registrant's authorized and previously unissued common stock and waived the payment of $10,000 owed to registrant by MM&S. In addition, the registrant agreed to make cash payments to the sellers totaling $144,000 in equal installments over a 12-month period. In consideration of the payments of cash and stock, the registrant was issued additional shares of MM&S common stock increasing its total ownership interest in MM&S to 53.145%. A full-text copy of the Agreement is available for free at http://ResearchArchives.com/t/s?62c3 About SecureAlert Sandy, Utah-based SecureAlert, Inc. (OTCBB: SCRA) -- http://www.securealert.com/-- is a monitoring, case management and advanced communications Technology Company with a portfolio of services utilized by more than 625 law enforcement agencies, judicial districts and county jurisdictions across 35 states. Approximately 15,000 offenders are supported, managed and supervised monthly through the company's programs, services and electronic monitoring initiatives. RemoteMDx, Inc., filed an amendment to its Articles of Incorporation changing its corporate name to SecureAlert, Inc. Additionally, the Company's subsidiary, SecureAlert, Inc., filed an amendment to its Articles of Incorporation changing its corporate name to SecureAlert Monitoring, Inc. At December 31, 2009, the Company's consolidated balance sheets showed $8,212,402 in total assets and $25,255,098 in total liabilities, resulting in a $17,042,696 shareholders' deficit. The Company's consolidated balance sheets at December 31, 2009, also showed strained liquidity with $2,692,487 in total current assets available to pay $23,099,738 in total current liabilities. The Company has incurred recurring net losses, negative cash flows from operating activities, and an accumulated deficit. "These factors raise substantial doubt about the Company's ability to continue as a going concern." The Company said it is presently unable to finance its business solely from cash flows from operating activities. During the three months ended December 31, 2009, the Company financed its business primarily from the issuance of debt and the issuance of stock providing cash proceeds of $1,531,304. SEQUENOM INC: Unveils $51.6 Million Private Placement ----------------------------------------------------- Sequenom, Inc., on May 12 entered into an agreement to issue and sell an aggregate of 12,435,000 shares of its common stock at $4.15 per share to certain investors. The aggregate gross proceeds of the private placement are expected to be approximately $51.6 million. Sequenom intends to use the net proceeds from the financing to advance its research, development and commercialization of various diagnostic tests, as well as for general corporate purposes. Subject to the satisfaction of customary closing conditions, the private placement was expected to close on or about May 17, 2010. Jefferies & Company, Inc. served as sole lead placement agent and Lazard Capital Markets LLC served as co-placement agent for Sequenom in the private placement. The shares of common stock sold in the private placement have not been registered under the Securities Act of 1933, as amended, or state securities laws and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or an applicable exemption from the registration requirements. The shares were offered and will be sold only to a limited number of accredited investors. Sequenom has agreed to file a registration statement with the Securities and Exchange Commission covering the resale of the common stock sold in the private placement. About Sequenom Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a life sciences company committed to improving healthcare through revolutionary genetic analysis solutions. Sequenom develops innovative technology, products and diagnostic tests that target and serve discovery and clinical research, and molecular diagnostics markets. The company was founded in 1994 and is headquartered in San Diego, California. The Company's balance sheet for March 31, 2010, showed $70.6 million total assets and $15.5 million total current liabilities, for a $50.0 million stockholders' equity. The Company's balance sheet at December 31, 2009, showed $86.6 million in total assets, $17.4 million in total current liabilities, $5.5 million long-term liabilities for a $63.6 million stockholders' equity. Accumulated deficit has reached $597.29 million. SEQUENOM INC: Posts $16 Million Net Loss for First Quarter ---------------------------------------------------------- Sequenom Inc. filed its quarterly report Form 10-Q, showing a net loss of $16.9 million on $10.6 million of total revenues for the three months ended March 31, 2010, compared with a net loss of $17.4 million on $8.6 million of total revenues for the same period a year earlier. The Company disclosed that: * Total revenue for the first quarter of 2010 grew 22% to $10.6 million, compared with $8.7 million for the first quarter of 2009. The increase in revenue was due to higher systems and consumables sales over the same period last year. * Net loss for the first quarter of 2010 was $16.9 million, or $0.27 per share, compared with $17.5 million, or $0.29 per share, for the first quarter of 2009. * Net cash used in operating activities was $13.4 million for the first quarter of 2010. Gross margin in the first quarter of 2010 was 50.5% compared with 60.6% for the first quarter of 2009, reflecting increased costs associated with the start-up of the diagnostics business and changes in the mix of products sold in the genetic analysis business. The overall gross margin included a 61% margin generated by the genetic analysis segment which was offset by the negative margin generated from the company's molecular diagnostics segment. Research and development expenses were $11.2 million for the first quarter of 2010, compared with $8.8 million for the same period in the prior year. The increase was primarily related to clinical sample acquisition costs associated with the company's Trisomy 21 program and a licensing payment for certain intellectual property rights for age-related macular degeneration related genetic variants. Selling, general and administration expenses of $11.1 million for the first quarter of 2010 decreased from $14.3 million for the first quarter of 2009. The decrease was primarily due to decreased legal fees associated with litigation and lower share based compensation expense. Total costs and expenses for the first quarter of 2010 were $27.5 million, compared with $26.5 million for the comparable quarter in 2009. For the three months ended March 31, 2010 and 2009, the company recorded $2.4 million and $3.0 million, respectively, of stock-based compensation expense. Cash, Cash Equivalents and Available for Sale Securities As of March 31, 2010 Sequenom had total cash and short- and long- term marketable securities of $29.2 million and $8.6 million in accounts receivable. "The Sequenom team is optimistic about the future opportunities that lie ahead for our genetic analysis and molecular diagnostics businesses." stated Harry F. Hixson, Jr., Ph.D., chairman and chief executive officer. "We are pleased to announce timelines for the development and clinical testing of our T21 test, which we expect will be of interest to physicians, patients and investors. Successfully meeting our T21 test development milestones, advancing our AMD test development program, and seeking partnering opportunities for some of our unfunded projects will be a major focus for Sequenom during 2010." Paul V. Maier, interim chief financial officer, stated, "Overall first quarter financial results met our expectations. Our achievement of more than $10 million of revenue in a quarter that historically has lower revenues is a good indicator that we can deliver growth in 2010. As a result, we believe that orders for the MassARRAY system and related consumables will provide a concrete foundation for the company as we continue to develop our molecular diagnostics capabilities." The Company's balance sheet at March 31, 2010, showed $70.6 million in total assets, $15.5 million in total current liabilities, $310,000 in deferred revenues, $3.1 million in other long-term liabilities, and $1.5 million in long-term portion of debts and obligations, for a stockholder's equity of $50.0 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62c1 A full-text copy of the Company's earnings release is available for free at http://ResearchArchives.com/t/s?6204 About Sequenom Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a life sciences company committed to improving healthcare through revolutionary genetic analysis solutions. Sequenom develops innovative technology, products and diagnostic tests that target and serve discovery and clinical research, and molecular diagnostics markets. The company was founded in 1994 and is headquartered in San Diego, California. The Company's balance sheet at December 31, 2009, showed $86.6 million in total assets, $17.4 million in total current liabilities, $5.5 million long-term liabilities for a $63.6 million stockholders' equity. Accumulated deficit has reached $597.29 million. Ernst & Young LLP of San Diego, California, has expressed substantial doubt against Sequenom Inc.'s ability as a going concern. The auditor noted that the Company has incurred recurring operating losses and does not have sufficient working capital to fund operations through 2010. SHOREBANK CORP: Raises More Than $125MM to Avoid Takeover --------------------------------------------------------- Reuters reports sources have said privately held ShoreBank Corp. is getting assistance from a consortium of Wall Street banks including Goldman Sachs Group Inc, Citigroup, JPMorgan and Bank of America. According to Reuters, the spokesmen for Citigroup and General Electric Co. each confirmed $20 million investments on Tuesday, and JPMorgan previously said it was ready to inject $15 million. As reported by the Troubled Company Reporter on May 17, 2010, sources told The Wall Street Journal Goldman agreed to commit $20 million. Reuters relates ShoreBank, which has $2.3 billion in assets, was reported to have exceeded the $125 million in rescue capital it needed to avoid a takeover by the Federal Deposit Insurance Corp. Reuters further relates that a ShoreBank spokesman declined to comment on specific investments, saying only that capital-raising efforts so far had been "encouraging." According to Reuters, Bill Brandt, chairman of the Illinois Finance Authority, said there had been no political arm-twisting to win investments for ShoreBank. He said Wall Street banks were happy for a chance to align themselves with a community bank that has a national reputation for philanthropic investments. SINCLAIR BROADCAST: Swings to $10.9-Mil. Profit in Q1 2010 ---------------------------------------------------------- Sinclair Broadcast Group Inc. filed its quarterly report on Form 10-Q with the Securities and Exchange Commission, showing $10.9 million of net income on $169.6 million of total revenues for the three months ended March 31, 2010, compared with a net loss of $87.0 million on $154.7 million of total revenues for the same period a year ago. The Company's balance sheet at March 31, 2010, revealed $1.5 billion in total assets and $1.7 billion in total liabilities, for a stockholders' deficit of $187.7 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a3 About Sinclair Broadcast Based in Baltimore, Maryland, Sinclair Broadcast Group, Inc. (Nasdaq: SBGI) -- http://www.sbgi.net/-- one of the largest and most diversified television broadcasting companies, currently owns and operates, programs or provides sales services to 58 television stations in 35 markets. The Company's television group reaches roughly 22% of U.S. television households and includes FOX, ABC, CBS, NBC, MNT, and CW affiliates. As of December 31, 2009, Sinclair had total assets of $1,597,721,000 against total liabilities of $1,799,943,000. As of December 31, 2009, Total Sinclair Broadcast Group shareholders' deficit was $211,950,000, and Noncontrolling interest was $9,728,000, resulting in Total deficit of $202,222,000. * * * Sinclair carries Moody's Investors Service's Caa2 Corporate Family Rating and Caa3 Probability of Default Rating; and Standard & Poor's Ratings Services' 'B-' corporate credit rating. SMURFIT-STONE: Proposes to Enter Into Consulting Pact With Murphy ----------------------------------------------------------------- Smurfit-Stone Container Corp. and its units ask the U.S. Bankruptcy Court for authority to enter into a confidential consulting agreement with John R. Murphy, the Debtors' former senior vice president and chief financial officer. James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, relates that through a consultancy arrangement to extend through September 1, 2010, the Debtors seek to obtain the benefits of Mr. Murphy's unique knowledge, particularly as it relates to financial matters, and to have Mr. Murphy available at the Debtors' request to assist with certain duties as the Debtors transitions a new CFO into the role. In connection with the proposed consultancy arrangement, Mr. Murphy also will agree to abide by non-solicitation provisions extending through the termination of the consultancy arrangement, to preserve the confidentiality of all proprietary or confidential information, to return all of the Debtors' property, and to release all claims against the Debtors, Mr. Conlan notes. In exchange for Mr. Murphy's continued services, the Debtors propose to pay $200,000 for Mr. Murphy's Consulting Services during the six-month Consulting Period, which is an amount equal to six months of his regular base salary while employed by the Debtors. Mr. Conlan tells the Court that Mr. Murphy also is eligible, per the terms of the proposed Agreement, to receive an incentive bonus that he would have received pursuant to the Debtors' 2009 Long Term Incentive Plan as though he had been employed from January 1, 2009, until the effective date of the Debtors' Chapter 11 Plan of Reorganization, and to receive $125,000 for outplacement services and certain relocation expenses that he has incurred or will incur. Mariner, Et Al., Respond On behalf of Mariner Investment Group LLC and Senator Investment Group LP, Kevin S. Mann, Esq., at Cross & Simon LLC, in Wilmington, Delaware, notes that under the Proposed Agreement, Mr. Murphy has agreed to provide up to 10 hours of services per week for up to six months. He adds that since his resignation, Mr. Murphy has moved to Florida. "For his up to 10 hours of work per week, from Florida, Mr. Murphy will receive the same salary that he received as the Debtors' full time CFO, his full 2009 LTIP award and $125,000 in outplacement services. This package is worth $750,000. For what?" Mr. Mann asks. The Proposed Agreement does not define or describe the "consulting services" that Mr. Murphy will perform and there is not a single sentence that says what he is going to do, where he is going to do it, if he has to travel or the hours or days he has to be available, Mr. Mann further points out. However, he notes that the Agreement is explicit about several things, including his: -- freedom to seek full-time employment elsewhere, including for a competitor of the Debtors; and -- agreement to keep his mouth shut and not say anything negative about the Debtors or its current, former or future officers and directors. "Although not a single sentence is devoted to what services Mr. Murphy will provide, paragraph after paragraph of the Agreement contain broad confidentiality, non-disparagement and release provisions," Mr. Mann contends. For these reasons, Mariner and Senator ask the Court not to grant the Debtors' request. Mariner's and Senator's response is joined by Fir Tree, Inc. and P. Schoenfeld Asset Management LP. 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. PricewaterhouseCoopers 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: Michigan Governor Wants Details on Closed Plant -------------------------------------------------------------- Jennifer M. Granholm, the governor of the State of Michigan, asks the U.S. Bankruptcy Court to compel Smurfit-Stone Container Corp. and its units to provide historical financial data regarding the operations of the Debtors' old mill in Ontonagon, Michigan. In her letter filed with the Court, Gov. Granholm notes that local redevelopment efforts to make the old mill useful have focused on the possible conversion of the mill's power plant to convert biomass to electricity, production of cellulosic ethanol, and exploring the use of the mill for the manufacture of non- competitive paper products. Gov. Granholm said Smurfit-Stone is not only inflicting significant job losses on the town of 1,509 residents but taking steps to strip the plant of the machinery and equipment that could make it useful to another operator, noted The Wall Street Journal. "I find this troubling and hard to understand," she wrote in her letter to Judge Brendan Shannon, the Journal further noted. "If these reports are true, then the opportunity for economic reuse may be lost with adverse consequences to the bankruptcy estate, to say nothing of the economic loss to the people of Ontonagon County and state of Michigan." According to Gov. Granholm, Smurfit-Stone "completely rebuffed" inquires from the state's Centers for Energy Excellence program that would seek to turn the aging paper mill into a biomass- fueled power plant and cellulosic ethanol production facility. A copy of Gov. Granholm's letter is available for free at: http://bankrupt.com/misc/SmrftGovLtter.pdf However, Smurfit-Stone spokesman Tim Rowden said the governor's letter "contains significant erroneous information," reports the Journal. Mr. Rowden added that the Chicago company has not stripped assets out of the mill. "The company does not believe that the facility will ever be viable as a paper mill, but is actively marketing the property for alternative uses, and is keeping local interests informed and involved in the process," he said, the report notes. In a separate filing, the Ontonagon County Board of Commissioners urges the Debtors to sell their Mill in Ontonagon County and provide necessary financial information which would allow a potential purchaser to formulate a purchase offer. 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. PricewaterhouseCoopers 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: Files Form 10-Q for March 31 Quarter --------------------------------------------------- A full-text copy of Smurfit-Stone Container Corporation's Quarterly Report for the period ended March 31, 2010, filed with the Securities and Exchange Commission on Form 10-Q is available at no charge at: http://tinyurl.com/29yra8f Smurfit-Stone Container Corporation Consolidated Balance Sheet As of March 31, 2010 ASSETS Current Assets: Cash $702,000,000 Restricted cash 22,000,000 Receivables 711,000,000 Receivables for alt. tax credits 11,000,000 Retained interests in receivables sold - Inventories Work-in process 114,000,000 Materials & supplies 358,000,000 --------------- 472,000,000 Refundable income taxes 25,000,000 Prepaid expenses and others 46,000,000 --------------- Total current assets 1,989,000,000 Net property 3,029,000,000 Timberlands, less depletion 2,000,000 Deferred income taxes 23,000,000 Other assets 60,000,000 --------------- Total assets $5,103,000,000 =============== LIABILITIES & EQUITY (DEFICIT) Liabilities Not Subject to Compromise: Current liabilities: Current maturities of long-term debt $1,353,000,000 Accounts payable 463,000,000 Accrued compensation and payroll taxes 140,000,000 Interest payable 14,000,000 Income taxes payable - Current deferred taxes - Other current liabilities 143,000,000 --------------- Total current liabilities 2,113,000,000 Other long-term liabilities 119,000,000 --------------- Total liabilities not subject to compromise 2,232,000,000 Liabilities subject to compromise 4,307,000,000 --------------- Total liabilities 6,539,000,000 Stockholders' Equity: Preferred stock 104,000,000 Common stock 3,000,000 Additional paid-in capital 4,082,000,000 Retained earnings (deficit) (4,972,000,000) Accumulated other comprehensive loss (653,000,000) --------------- Total stockholders' deficit (1,436,000,000) Total liabilities & stockholders' deficit $5,103,000,000 =============== Smurfit-Stone Container Corporation Consolidated Statement of Operations For the three months ended March 31, 2010 Net sales $1,461,000,000 Costs and expenses: Cost of goods sold 1,356,000,000 Selling and administrative expenses 151,000,000 Restructuring charges (4,000,000) (Gain) Loss on disposal of assets - Other operating income (11,000,000) --------------- Income(Loss) from operations (31,000,000) Other income (expense): Interest expense, net (13,000,000) DIP Debt issuance costs - Loss on early extinguishment of debt - Foreign currency exchange gains (losses) (6,000,000) Other, net 2,000,000 --------------- Income(loss) before reorg. items and (48,000,000) income taxes Reorganization items, net (41,000,000) --------------- Income(Loss) before income taxes (89,000,000) Benefit from income taxes - --------------- Net Income(loss) ($89,000,000) =============== Smurfit-Stone Container Corporation Consolidated Statement of Cash Flows For the nine months ended March 31, 2010 Cash flows from operating activities: Net loss ($89,000,000) Adjustments: Loss on early extinguishment of debt - Depreciation, depletion, & amortization 85,000,000 DIP Debt issuance costs - Amortization of debt issuance costs - Deferred income taxes (2,000,000) Pension & postretirement benefits 28,000,000 (Gain)Loss on disposal of assets - Non-cash restructuring expenses (3,000,000) Non-cash stock-based compensation 1,000,000 Non-cash foreign currency exchange gains 6,000,000 Non-cash reorganization items 26,000,000 Change in restricted cash 2,000,000 Change in current assets & liabilities: Receivables (93,000,000) Receivables for alt. energy tax cred. 48,000,000 Inventories (19,000,000) Prepaid expenses & other current assets (3,000,000) Accounts payable 46,000,000 Interest payable 3,000,000 Others, net 14,000,000 --------------- Net cash provided by operating activities 50,000,000 Cash flows from investing activities: Expenditures for property (34,000,000) Proceeds from property disposals 6,000,000 Advances to affiliates, net - --------------- Net cash used for investing activities (28,000,000) Cash flows from financing activities: Proceeds from DIP debt - Net borrowings of long-term debt (1,000,000) Repurchase of receivables - DIP Debt issuance costs - Deferred debt issuance costs (9,000,000) Change in restricted cash (15,000,000) --------------- Net cash provided(used) by financing activities (25,000,000) Effect of exchange rate changes on cash 1,000,000 Increase(decrease) in cash and cash equivalents (2,000,000) Cash & cash equivalents: Beginning of period 704,000,000 --------------- End of period $702,000,000 =============== 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. PricewaterhouseCoopers 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) SPARETIME FAMILY: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Sparetime Family Fun Center, Inc. dba Vorwaller Investments, LLC P.O. Box 364 Roy, UT 84067 Bankruptcy Case No.: 10-26552 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court District of Utah (Salt Lake City) Judge: Judith A. Boulden Debtor's Counsel: Matthew M. Boley, Esq. Parsons Kinghorn Harris 111 E. Broadway, 11th Floor Salt Lake City, UT 84111 Tel: (801) 363-4300 Fax: (801) 363-4378 E-mail: mmb@pkhlawyers.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Kimberly J. Vorwaller, president. SPCM SA: S&P Upgrades Rating on Long-Term Corp. Rating to 'BB-' --------------------------------------------------------------- Standard & Poor's Ratings Services raised its long-term corporate credit rating on SPCM S.A. (SNF) to 'BB-' from 'B+'. The outlook is stable. At the same time, we raised by one notch the issue rating on SNF's senior secured bank loans to 'BB' and the rating on its senior unsecured bonds to 'BB-', in line with the one-notch raise on the corporate credit rating. The recovery ratings on the senior secured bank loans and senior unsecured bonds remain unchanged. The bank loans have a recovery rating of '2', indicating our expectation of substantial (70% to 90%) recovery in case of a payment default, and the senior unsecured bonds are rated '4', indicating our expectation of average (30% to 50%) recovery for bondholders. "The upgrade reflects the better-than-expected credit metrics, liquidity and covenant leeway since second-quarter 2009, and our expectations that they would remain in line with a 'BB-' rating going forward," said Standard & Poor's credit analyst Lucas Sevenin. This notably mirrors our view of a more supportive financial policy, which should help credit metrics and liquidity in case of adverse market developments with, for example, reduced capital expenditure (capex). Our upgrade also reflects our view that EBITDA should remain satisfactory, albeit clearly down from the record 2009 levels. SNF had sales of ?1 billion in 2009 and EBITDA of about ?170 million. The adjusted debt reached about ?340 million. We classify the business risk profile in the high end of the fair category. We view positively the company's world market leadership in water treatment polymers and rising contribution from higher margin (albeit more volatile) polymers used for enhanced oil recovery (EOR). We view SNF's business model as benefiting from strong historical growth, good resilience to falling GDP, as seen in 2009, and continued good demand prospects, especially in EOR. We think the business model resilience is illustrated, for instance, by SNF's modest volume decline of about 5% in first-half 2009, against other chemical players' sharp drops of 20% to 30%. We also take into account the company's wide and balanced geographic coverage. Key risk factors remain, however, due to the sensitivity of SNF's EBITDA to volatile raw material prices (propylene related), while selling prices may undergo a squeeze, mainly due to competition or clients pressing for lower prices. The stable outlook reflects our expectations that EBITDA will remain adequate, albeit much lower than in 2009. We have also assumed that the group's financial policy will remain supportive, notably with respect to controlling negative free cash flow that will likely result from the group's large capital spending plans. We would notably view an adjusted ratio of FFO to debt of about 20% as commensurate with the rating. We also assume shareholder distributions and acquisitions to remain thin, at less than ?10 million per year. The rating could be under pressure if credit metrics deteriorated for a prolonged period of time, material acquisitions or dividends appeared, or if EBITDA was lower than expected and capex not adjusted. Over the long term, we might raise the rating if the financial policy was more supportive, such that credit metrics would be sustainably stronger than currently factored in, with, for example, an FFO to debt above 25% to 30%. Given the company's growth strategy, we view that as less likely. SPHERIS INC: Has Buyer for $17.5 Million Subordinated Note ---------------------------------------------------------- Bloomberg News reports that Spheris Inc. sold its business in April for $98.83 million, a price that included a $17.5 million subordinated note from the purchasers, subsidiaries of CBay Holding Ltd. Spheris, now formally named SP Wind Down Inc., on May 18 agreed to sell the note to Riva Ridge Master Fund Ltd. for an undisclosed price. The five-year note starts off paying interest at 8%, rising to 12.5%. CBay, which also provides medical transcription services, has the right to prepay the note within six months for 77.5% of outstanding principal. The official creditors' committee supports the sale. A hearing to approve the deal is scheduled for June 8. About Spheris Headquartered 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 restructuring efforts. Jefferies & Company serves 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 the Debtors' 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. STATION CASINOS: Plan Outline Hearing Scheduled for June 10 ----------------------------------------------------------- Station Casinos, Inc., and its debtor-affiliates informed parties- in-interest that the hearing to consider approval of the Disclosure Statement explaining their Joint Chapter 11 Plan of Reorganization is scheduled for June 10, 2010, at 10:00 a.m., in the U.S. Bankruptcy Court for the District of Nevada, in the Clifton Young Federal Building, at 300 Booth Street, First Floor- Courtroom, in Reno, Nevada. The original Disclosure Statement Hearing Date was May 5, 2010. The Debtors delivered to Judge Gregg W. Zive of the U.S. Bankruptcy Court for the District of Nevada a Joint Chapter 11 Plan of Reorganization and an accompanying Disclosure Statement on March 24, 2010. Station Casinos Inc. said in a statement that as part of the comprehensive plan, the mortgage lenders to FCP Propco, LLC, holding debt secured by Red Rock Casino Resort Spa, Palace Station, Boulder Station, and Sunset Station, will become the equity owners of a newly-formed company and will sell 46% of the equity to Frank Fertitta III and Lorenzo Fertitta, who will make a significant new investment to purchase their equity in the new company. The remaining equity will be owned primarily by the Propco Lenders and Colony Capital, who will also be making a new investment in the company. Fertitta Gaming, an entity owned by the Fertittas, will also manage the Propco Properties under a long-term management agreement. In order to establish an orderly and value-maximizing process for sale to occur, the Debtors requested approval of certain sale and bidding procedures to sell the Opco Assets in a competitive sale process. The Court, however, has not entered a ruling on the proposed bidding process due to a number of objections lodged by various parties. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. The Company owns and operates Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Rancho and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Wildfire Boulder, Gold Rush Casino and Lake Mead Casino in Henderson, Nevada. Station also owns a 50% interest in Green Valley Ranch Station Casino, Aliante Station Casino and Hotel, Barley's Casino & Brewing Company, The Greens and Wildfire Lanes in Henderson, Nevada and a 6.7% interest in the joint venture that owns the Palms Casino Resort in Las Vegas, Nevada. In addition, the Company manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. Station Casinos Inc., together with its affiliates, filed for Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as local counsel. The Debtor is also hiring Lazard Freres & Co. LLC as investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STATION CASINOS: Plan Exclusivity Extended Until June ----------------------------------------------------- Station Casinos, Inc., and its debtor-affiliates sought and obtained a ruling from Judge Gregg W. Zive of the United States Bankruptcy Court for the District of Nevada extending the period during which no party other than the Debtors may file a plan pursuant to Section 1121(c)(3) of the Bankruptcy Code from May 24, 2010, to the confirmation hearing date. The Debtors filed their Joint Chapter 11 Plan of Reorganization on March 24, 2010, so the initial 120-day exclusive period contained in Section 1121(c)(2) is no longer applicable, Paul S. Aronzon, Esq., at Milbank, Tweed, Hadley & McCloy LLP, Los Angeles, California -- paronzon@milbank.com -- tells the Court. In a declaration filed with the Court, Thomas M. Friel, executive vice-president and chief accounting officer of Station Casinos, Inc., avers that good and sufficient cause exists to grant the Debtors a further extension of the Exclusive Period from May 24, 2010 to the dates on which the Court has scheduled the hearing on confirmation of the Joint Plan, on July 15 and 16, 2010, as the dates may be adjourned from time to time. The Joint Plan contemplates a going concern sale of the Opco Assets. In order to establish an orderly and value-maximizing process for sale to occur, the Debtors anticipate requesting that the Court approve certain sale and bidding procedures to sell the Opco Assets in a competitive sale process, Mr. Friel says. According to Mr. Friel, the Debtors' intent is to implement sale procedures designed to encourage a competitive sale process that will generate the highest and best possible sale results for the Opco Assets. The approval of any sale of the Opco Assets will be contingent upon and occur in conjunction with confirmation of the Joint Plan. Mr. Aronzon adds that in order to ensure that the sale process will yield the highest or otherwise best bid for the Opco Assets, the Exclusive Period should be extended to allow the plan solicitation and sale processes to run in parallel through the Confirmation Hearing Date. In addition to the Joint Plan, the Disclosure Statement and the proposed bidding procedures, the Debtors expect to file a motion for approval of a modified Master Lease Compromise Agreement. The original MLCA was approved in December 2009 and covered December 2009 to February 2010. The MLCA was then extended to cover March and April 2010. The existing MLCA is set to expire on May 14, with May rent coming due on May 11, 2010. The Debtors anticipate that the next generation of the MLCA will not simply extend the terms of the existing MLCA, but will contain substantive provisions designed to begin the steps necessary to successfully separate the Propco Assets -- the Debtors' gaming properties and operations assets -- from the Opco Assets -- the Debtors' assets other than the gaming properties and operations assets -- in the manner contemplated by the Joint Plan. Mr. Aronzon avers that the extension of the Exclusive Period requested in the Motion is necessary to give the Debtors sufficient time to: (a) obtain approval of the adequacy of the Disclosure Statement and authority to pursue the related solicitation procedures, (b) obtain approval of and authority to enter into the modified MLCA, and (c) pursue an orderly and competitive going concern auction process to sell the Opco Assets to the highest bidder. Mr. Aronzon argues that viewed in relation to the size of the Chapter 11 Cases and the complexities and challenges facing the Debtors in connection with the sale of the Opco Assets and the separation of the Propco Assets from the Opco Assets, a further extension of the Exclusive Period will provide the Debtors with a full and fair opportunity to pursue the requisite sale of the Opco Assets and the separation of the Opco Asset and the Propco Assets and confirm the Joint Plan. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. The Company owns and operates Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Rancho and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Wildfire Boulder, Gold Rush Casino and Lake Mead Casino in Henderson, Nevada. Station also owns a 50% interest in Green Valley Ranch Station Casino, Aliante Station Casino and Hotel, Barley's Casino & Brewing Company, The Greens and Wildfire Lanes in Henderson, Nevada and a 6.7% interest in the joint venture that owns the Palms Casino Resort in Las Vegas, Nevada. In addition, the Company manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. Station Casinos Inc., together with its affiliates, filed for Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as local counsel. The Debtor is also hiring Lazard Freres & Co. LLC as investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STATION CASINOS: Sale Motion Not Ripe for Adjudication, Says Panel ------------------------------------------------------------------ At the end of April, Station Casinos Inc. and its units filed a motion asking for authority to sell all or substantially all of the OpCo Assets -- consisting of 14 casino properties owned by Station Casinos Inc., the casinos' related assets, as well as SCI's direct and indirect interests in a variety of other management and development opportunities. According to Bloomberg News, U.S. Bankruptcy Court Judge Gregg Zive in Reno, Nevada, said at a hearing early this month that he won't ruile on the Company's request to hold an auction until the end of May at the earliest, after opposing creditors have a chance to question two company financial advisers. Sale of the OpCo Assets On behalf of Station Casinos, Paul S. Aronzon, Esq., at Milbank, Tweed, Hadley & McCloy LLP, Los Angeles, California, says the sale of Opco Assets contemplated by the Motion is an essential component of the Debtors' Joint Plan of Reorganization. The Joint Plan contemplates that the Opco Assets will be sold to the highest bidder, with the net proceeds of that sale to be distributed to creditors in accordance with the respective priorities of their claims. The Joint Plan further contemplates that the sale process will run roughly contemporaneously with the solicitation of votes on the Joint Plan and that the auction will occur shortly before the confirmation hearing on the Joint Plan, but sufficiently in advance of the confirmation hearing so that the terms of the proposed sale to the highest bidder will be known and available for the Court's consideration and approval at the time of the confirmation hearing. The OpCo Assets do not include the four properties owned by debtor FCP PropCo, LLC -- Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Sunset Station Hotel & Casino and Red Rock Casino Resort Spa -- and their related furniture, fixtures and equipment and other assets used in connection with the operation of those properties. Certain, but not all, of the Opco Assets serve as collateral to secure the repayment of SCI's prepetition secured loan from its senior secured lenders. In addition, there are certain assets, the "Excluded Assets," that are owned by members of the Opco Group but fall within the Propco Assets, because they are used exclusively or predominantly in connection with the operation of the Propco properties. The Excluded Assets consist entirely of assets that are to be transferred to Propco or New Propco under the Joint Plan or pursuant to the Master Lease Compromise Agreement and all amendments thereto approved by the Bankruptcy Court. The Opco Assets and the Propco Assets are under the common management of SCI. The Debtors believe that the value of the Opco Assets will be maximized through the Sale of all or substantially all of the Opco Assets. However, the Debtors recognize that certain Potential Bidders may desire to acquire only a portion or portions of the Opco Assets. Accordingly, the Debtors will entertain, in their discretion: (i) bids for all or any portion or portions of the Opco Assets; and (ii) Joint Bids for all, substantially all or portions of the Opco Assets. Each casino property that is an Opco Asset may be sold separately, or multiple casino properties may be sold in groupings of multiple properties. If any casino property is sold separately or as part of a group, all customer data for customers whose primary casino play is at that property will be sold only to the Successful Bidder for that property on an exclusive basis. As a result, only the buyer of any particular casino property will be entitled to maintain and use the Primary Customer Data post-closing. No other party will be entitled to use or purchase the Primary Customer Data, and no member of the Opco Group will be entitled to sell the Primary Customer Data related to any casino property to any entity other than the buyer or transferee of the casino property. Upon consummation of the Sale, the participants in a Joint Bid may decide to divide the Opco Assets amongst themselves and operate certain Opco Assets separately from others. Bid Procedures In connection with the sale, the Debtors also ask the Court to approve and establish bid procedures for the sale of the OpCo Assets. The Debtors have been engaged in restructuring discussions of one form or another for nearly 15 months. During that time, the Debtors and their advisors have received inquiries from several potential purchasers of Opco Assets. As part of the implementation of the Bidding Procedures, the Debtors and their advisors intend to contact all parties to advise them of the potential opportunity to acquire some or all of the Opco Assets. In addition, if the Court approves the Bidding Procedures, the Debtors will promptly publish notice of the Bidding Procedures in The Wall Street Journal and The Las Vegas Review-Journal. As Potential Bidders are identified and sign up to appropriate confidentiality agreements, they will be provided with due diligence access to materials and information relating to the Opco Assets as the Debtors reasonably deem appropriate. Among other things, the Bidding Procedures provide that: (a) Potential Bidders will have until 45 days after entry of the Bidding Procedures Order to submit a preliminary letter of intent and certain other information necessary for the Debtors' to assess the Potential Bidders interest in and ability to consummate a transaction regarding the Opco Assets; (b) Potential Bidders that are designated Qualified Bidders will have until the Bid Deadline to submit to the Debtors their definitive bid materials, which will include a duly authorized and executed purchase agreement for the subject Opco Assets that will serve as an irrevocable offer pending the Debtors' selection of a Successful Bidder for the assets; (c) A Qualified Bid will be valued based upon several factors including items such as the purchase price and the net value provided by the bid, the claims likely to result from or be created by the bid in relation to other bids, the relative ability of the counterparties to the Sale proposed by the Qualified Bidder to consummate the Sale, the nature and extent of any proposed revisions to the Purchase Agreement, the effect of the proposed Sale on the value of the ongoing businesses of the Debtors, other factors affecting the speed, certainty and value of the proposed Sale, any assets excluded from the bid, the transition services required from the Debtors post-closing and any related restructuring costs, and the likelihood and timing of consummating the Sale, each as determined by the Debtors following consultation with the Consultation Parties; (d) If the Debtors do not receive any Qualified Bids, the Debtors will proceed as set forth in the "No Qualified Bids" section of the Bidding Procedures which reserve to the Debtors the right to terminate the sale process or extend, subject to the Bidding Procedures, the deadlines for receiving, evaluating and selecting a Successful Bid; (e) If multiple Qualified Bids are submitted for the same or for overlapping subsets of the Opco Assets, the Debtors, under the direction of SCI's independent director, will conduct an auction in accordance with the Bidding Procedures to determine the highest or otherwise best offer for the assets following competitive bidding; (g) If the Debtors receive a single Qualified Bid, the Debtors reserve the right, in consultation with the Consultation Parties, to terminate the sale process or extend, subject to the terms hereof, the deadlines set forth in the Bidding Procedures without further notice in an effort to solicit and obtain competing Qualified Bids. Alternatively, Debtors may evaluate the single Qualified Bid on its own merit to determine whether the single Qualified Bid is a Successful Bid; and (h) Once a Successful Bid or Successful Bids are selected, the Debtors will promptly seek Court approval of the selected transactions as part of the hearing on confirmation of the Joint Plan. The closing of any Sale may involve additional intermediate steps or transactions to facilitate consummation of the Sale, including the additional Chapter 11 filings or merger or other corporate transaction of subsidiaries of the Debtors and other actions or transactions necessary to implement the Joint Plan. A full-text copy of the proposed Bidding Procedures is available for free at: http://bankrupt.com/misc/SCI_PropBiddingProcedures.pdf Restructuring Support Agreement SCI entered into a restructuring support agreement, dated April 16, 2010, with: * the lenders under the Opco Loan Agreement; * the Opco Debtor Subsidiaries and non-debtor subsidiaries; * Fertitta Gaming LLC and Frank J. Fertitta III and Lorenzo J. Fertitta, as primary equity investors in FG. A full-text copy of the Restructuring Support Agreement is available for free at: http://bankrupt.com/misc/SCI_RestructuringSupportPact.pdf Thomas R. Kreller, Esq., at Milbank, Tweed, Hadley & McCoy LLPO, in Los Angeles, California, explains that the Restructuring Support Agreement serves two basic purposes, by (i) evidencing the agreement of the Consenting Lenders to support the Joint Plan and the Bidding Procedures, as well as the continued use of cash collateral by Opco and its non-debtor subsidiaries and affiliates and the requested extension of the Debtors' exclusive right to file a plan, among other things; and (ii) setting forth the Consenting Lenders' agreement to the designation of the bid for the Opco Assets that has been submitted by FG and the Mortgage Lenders as the stalking horse bid in the Opco Sale Process. The Agreement provides the framework for the Purchaser to acquire the Opco Assets and assume certain liabilities pursuant to the Term Sheet annexed to the Opco Support Agreement. The acquisition will be effectuated through (i) modifications to the Joint Plan acceptable to SCI, the Purchaser and the Lenders; and (ii) the negotiation of a purchase and sale agreement by the Purchaser and SCI, subject to the reasonable satisfaction of the Mortgage Lenders, FG and the Required Consenting Lenders, according to Mr. Kreller. The Term Sheet of the Restructuring Agreement sets forth these fundamental terms of the Stalking Horse Bid: * Purchase Price of $772,000,000 for the Opco Assets. * Purchase Price consists of $317 million in cash and $455 million in new debt. * The new debt will be comprised of a $430 million term loan, secured by substantially all of the Opco Assets, and a $25 million land loan secured by Opco's existing unencumbered. * If the Stalking Horse Bidder is not the successful bid and an alternate bid is selected and consummated, the Stalking Horse Bidder will be entitled to reimbursement of reasonable out-of-pocket expenses and to the consensual transfer and purchase of the Assets. The Stalking Horse Bid will be fully documented in the Purchase & Sale Agreement, Mr. Kreller notes. Consequently, the Debtors amended the Bidding Procedures for the Opco Sale to essentially reflect the terms of the Sale in accordance with the Restructuring Support Agreement. A full-text copy of the Amended Bidding Procedures is available for free at: http://bankrupt.com/misc/SCIAmendedBiddingProcedures.pdf Parties React Various parties have objected to the Bidding Procedures. In a document filed May 18 before the Bankruptcy Court, the Official Committee of Unsecured Creditors noted that in the absence of a Purchase and Sale Agreement, the Bidding Procedures Motion is incomplete and not ripe for adjudication by the Court. Bidders seeking to buy all of the OpCo Assets must submit a blacklined copy of their purchase agreement marked to show changes to this yet non-existent Purchase and Sale Agreement. It noted that the Purchase and Sale Agreement was not available (i) on April 19, when the Motion was filed, (ii) during initial discovery from April 25 - May 3, (iii) at the May 4-5 Hearing, (iv) during supplementary discovery from May 10-14 and (v) prior to the May 18 deadline for the filing of this Supplemental Objection. "This Court cannot approve the Bidding Procedures without this document, which will be the subject of review, commentary, discovery and controversy like all other proposed agreements have been. The Bidding Procedures Motion should be denied on this basis alone." The Committee also alleged that the proposed transactions are "tilted in favor of the Fertitta family." It said that the proposed deals work together to transfer value to the Fertitta family and the PropCo Lenders to the detriment of the OpCo estate. "There can be no question that the Debtors and their lenders have devised a complicated structure through multiple agreements that purport to resolve these cases before the first dollar has been bid at auction and the first vote cast on the plan, and have designed the agreements to rise and fall together in order to benefit insiders and bind the hands of all parties, including this Court," the Committee said. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. The Company owns and operates Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Rancho and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Wildfire Boulder, Gold Rush Casino and Lake Mead Casino in Henderson, Nevada. Station also owns a 50% interest in Green Valley Ranch Station Casino, Aliante Station Casino and Hotel, Barley's Casino & Brewing Company, The Greens and Wildfire Lanes in Henderson, Nevada and a 6.7% interest in the joint venture that owns the Palms Casino Resort in Las Vegas, Nevada. In addition, the Company manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. Station Casinos Inc., together with its affiliates, filed for Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as local counsel. The Debtor is also hiring Lazard Freres & Co. LLC as investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STATION CASINOS: Employees Say Chapter 11 Plan Unconfirmable ------------------------------------------------------------ The Informal Committee of Station Employees argues that the Joint Chapter 11 Plan of Reorganization delivered to the Court on dated March 24, 2010, by Station Casinos, Inc., FCP PropCo, LLC, and their debtor-affiliates should not be confirmed because it fails to include meaningful workforce retention provisions. The Station Employees Committee, comprised of ten employees of ten Station casinos throughout Las Vegas, explains that the Debtors' "hastily-drafted" Joint Plan gives scant attention to employee- related issues, specifically with respect to workforce retention, even as it proposes sweeping ownership changes at the Debtors' operating subsidiaries. The Plan specifically envisions that Propco/New Propco may not retain existing employees and merely may "make employment offers" to them and "set up its own employee benefit plans." Accordingly, confirmation of the Plan "could lead to the mass termination of all employees who currently work at the Propco properties," Richard G. McCracken, Esq., at McCracken, Stemerman & Holsberry, in Las Vegas, Nevada, says on behalf of the Committee While hourly employees of Station Casinos are employed by non- debtor subsidiaries of the Debtors, hourly employees have an interest in the Debtors' successful reorganization "because their jobs depend upon it," Mr. McCracken points out. Kevin Kline, Director of Organizing of Culinary Workers Union Local 226 -- a part of the Local Joint Executive Board of Las Vegas -- filed a declaration relating to the Station Employees Committee's objection. About Station Casinos Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. The Company owns and operates Red Rock Casino Resort Spa, Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Rancho and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino, Fiesta Henderson Casino Hotel, Wildfire Boulder, Gold Rush Casino and Lake Mead Casino in Henderson, Nevada. Station also owns a 50% interest in Green Valley Ranch Station Casino, Aliante Station Casino and Hotel, Barley's Casino & Brewing Company, The Greens and Wildfire Lanes in Henderson, Nevada and a 6.7% interest in the joint venture that owns the Palms Casino Resort in Las Vegas, Nevada. In addition, the Company manages Thunder Valley Casino near Sacramento, California on behalf of the United Auburn Indian Community. Station Casinos Inc., together with its affiliates, filed for Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477). Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as legal counsel in the Chapter 11 case; Brownstein Hyatt Farber Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as local counsel. The Debtor is also hiring Lazard Freres & Co. LLC as investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. In its bankruptcy petition, Station Casinos said that it had assets of $5,725,001,325 against debts of $6,482,637,653 as of June 30, 2009. About 4,378,929,997 of its liabilities constitute unsecured or subordinated debt securities. Bankruptcy Creditors' Service, Inc., publishes Station Casinos Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Station Casinos Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SUMMIT HOTEL: Fortress Deal to Forbear Expired on May 17 -------------------------------------------------------- According to a regulatory filing, Fortress Credit Corp.'s agreement to forbear from declaring a default or otherwise enforcing its rights under Summit Hotel Properties LLCs has expired on May 17, 2010. The Company and Fortress have agreed to the material terms of an extension of the Fortress Loan. To permit the parties time to finalize definitive documentation for the extension, Fortress agreed, pursuant to a Forbearance Agreement to forbear from declaring a default or otherwise enforcing its rights under the Fortress Loan until April 5, 2010, which was amended to April 19, 2010, and further amended to May 3, 2010. The Forbearance Agreement has been further amended, pursuant to a Third Amended and Restated Forbearance Agreement, to extend the period of forbearance until May 17, 2010. In March 2007 the Company entered into the Fortress Loan, in the amount of $99.7 million and with a maturity date of March 5, 2010. The balance of the Fortress Loan was $85.0 million as of April 5, 2010. About Summit Hotel Summit Hotel Properties, LLC is a developer, owner and manager of hotels categorized as mid-scale without food and beverage and upscale hotels located throughout the United States. As of December 31, 2009, the Company owned 65 hotels in 19 states. The Company's revenues and earnings are derived from hotel operations of its owned hotels. An affiliate, The Summit Group, Inc., provides a number of services for its hotels, including hotel operations management, location of acquisition targets and construction sites, development of construction sites, and construction supervision. As of December 31, 2009, Summit Hotel Properties had two wholly owned limited liability companies that own hotel properties. Summit Hospitality I, LLC owns 25 of the Company's hotels. In addition, Summit Hospitality V, LLC, is a wholly owned subsidiary, which owns 13 of the Company's hotels. Summit Hotel Properties disclosed assets of $527,652,448 against debts of $441,801,665 as of Sept. 30, 2009. SUNWEST MANAGEMENT: Sale to Blackstone Group Approved ----------------------------------------------------- Emeritus Corporation disclosed that U.S. District Court Judge Michael Hogan approved the purchase and sale agreement in the Sunwest bankruptcy auction submitted by the previously announced joint venture between Emeritus, Blackstone Real Estate Advisors VI, L.P. and Columbia Pacific Advisors, LLC, an entity affiliated with Dan Baty, Emeritus' Chairman and Co-CEO. This joint venture was formed specifically to acquire up to 149 communities formerly operated by affiliates of Sunwest Management for approximately $1.3 billion. Mr. Baty stated, "We are excited that the Sunwest transaction has formally been approved by the court. This Joint Venture structure provides a built-in pipeline to propel our growth strategy over the next several years." While the previously announced 5% management fee represents an immediate accretive cash flow opportunity to the Company, a greater potential long-term value lies in Emeritus' right of first opportunity to purchase the Sunwest communities, or the Joint Venture interests, and the ability to earn additional cash distribution incentives if the rate of return on membership interests in the Joint Venture exceeds established thresholds. The details of the transaction have not materially changed from those described in the Company's previous announcement dated May 11, 2010. The core 149 communities consist of approximately 12,152 units with approximately 8,820 assisted living/memory care units and 3,332 independent living units. The ultimate community count and, therefore, transaction value, may change based on the Joint Venture's limited ability to change the portfolio of communities included in the transaction and final debt assumption negotiations. The closing of the transaction, which is subject to the satisfaction of certain customary closing conditions, is expected to occur in the third quarter of 2010. Assuming completion of this transaction, Emeritus will operate over 450 communities in 44 states with a capacity of over 39,000 units and a resident capacity of over 45,000. About Emeritus Corporation Emeritus Corporation is a national provider of assisted living and Alzheimer's and related dementia care services to seniors. Emeritus is one of the largest and most experienced operators of freestanding assisted living communities located throughout the United States. These communities provide a residential housing alternative for senior citizens who need assistance with the activities of daily living, with an emphasis on personal care services, which provides support to the residents in the aging process. Emeritus currently operates 316 communities in 36 states representing capacity for approximately 27,500 units and approximately 32,800 residents. 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. TELETOUCH COMMS: Unit Inks Settlement with Hawk Electronics ----------------------------------------------------------- Teletouch Communications Inc.'s unit Progressive Concepts Inc. entered in a certain Mutual Release and Settlement Agreement with Hawk Electronics Inc. The foregoing settlement followed a litigation matter styled Progressive Concepts, Inc. d/b/a Haw Electronics v. Hawk Electronics, Inc. Case No. 4-08CV-438-Y, by the Company against Hawk in the US District Court for the Northern District of Texas which alleged, among other things, infringement on the tradename Hawk Electronics, as well as counterclaims by Hawk against the Company of, among other things, trademark infringement and dilution. Under terms of the Agreement, the parties executed mutual releases of claims against each other and agreed to file a stipulation of dismissal in connection with the pending litigation matter. As consideration for the foregoing, the Company agreed to, among other things, (i) purchase a perpetual license from Hawk to use the mark "Hawk Electronics" for $900,000 payable in installments through July 2013, and (ii) assign to Hawk the right and interest in the domain name www.hawkelectronics.com. In exchange, Hawk agreed to, among other things, allow the Company to continue using the domain name www.hawkelectronics.com in exchange for a monthly royalty payable to Hawk beginning August 2013. For over 40 years, Teletouch Communications, Inc. -- http://www.Teletouch.com/-- has offered a comprehensive suite of telecommunications products and services including cellular, two- way radio, GPS-telemetry, wireless messaging and public safety/emergency response vehicle products and services throughout the U.S. With over 80,000 wireless customers, Teletouch's wholly- owned subsidiary, Progressive Concepts, Inc. (PCI), is a leading provider of ATT Mobility(R) (NYSE: T) services (voice, data and entertainment), as well as other mobile, portable and personal electronics products and services to individuals, businesses and government agencies. The company's balance sheet for Feb. 28, 2010, showed $20.9 million total assets and $30.1 million total assets, for a $9.1 million total stockholders' deficit. THOMAS ENTERPRISES: Unit Slapped With Multimillion Civil Lawsuit ---------------------------------------------------------------- International hotelier Jean V. Mestriner filed a civil action Tuesday in the Superior Court of Coweta County, Georgia, against his ex-employer Luxera International LLC, a subsidiary of Thomas Enterprises Inc., seeking $2,674,011.00 - the amount he was awarded in arbitration a year ago by an International Arbitration Tribunal in New York. The award was issued May 21, 2009 for breach of contract and failure to pay federal and state income taxes. According to recent media reports, this is not the lone instance in which Thomas Enterprises has been remiss in paying taxes. Thomas Enterprises was late in paying California property tax debt associated with ownership and development of the Sacramento's Railyards project. Thomas Enterprises filed for bankruptcy protection on three large projects and averted foreclosure on one of the company's signature properties in September. Property Week recently reported "Thomas Enterprises is in crunch talks with lender Lloyds Banking Group over its 10 Trinity Square hotel development project in London. Lloyds is now thought to be considering whether to place the asset into receivership, among various options." About Mestriner Mestriner, one of the top global hoteliers in the world, is recognized for his high end concept designs and standards and previously worked for Armani Hotels and Residences. He entered into an employment agreement with Thomas Enterprises, Inc. (owner of Luxera International) in August 2006 to develop and operate a portfolio of luxury hotels and residences including the 10 Trinity in London, UK. Mestriner resigned his position in 2008 with good cause. TLC VISION: Emerges from Chapter 11 as Private Company ------------------------------------------------------ TLC Vision (USA) Corporation, North America's premier eye care services company, has officially emerged from Chapter 11 as a newly reorganized, private company. The Company's Plan of Reorganization, which was confirmed by the U.S. Bankruptcy Court on May 6, 2010 and subsequently recognized by a Canadian court order, has become effective. All outstanding closing conditions have been satisfied or waived. In accordance with the Plan, affiliates of Charlesbank Capital Partners, LLC and H.I.G. Capital, LLC have acquired substantially all the assets of TLC Vision Corporation, including 100% of the equity of the Company and TLC Vision Corporation's six refractive centers in Canada. It is expected that any remaining assets of TLC Vision Corporation will be liquidated in a Canadian proceeding and that net proceeds of such liquidation, if any, will be distributed to TLC Vision Corporation's creditors in accordance with the Plan. James B. Tiffany, President and Chief Executive Officer of TLC Vision stated, "This is an exciting day for TLC Vision. We have successfully completed our financial restructuring in just five months and we exit Chapter 11 with a healthier balance sheet and an improved cost structure. We look forward to teaming with our new partners, Charlesbank and H.I.G. We are now better positioned both competitively and financially to take advantage of opportunities within our markets and achieve our true growth potential." Continued Tiffany, "I want to thank our employees, who worked tirelessly during the reorganization process to ensure our success, our surgeons and our network of over 5,000 optometrists, who continue to support TLC. Lastly, I offer a special thanks to our outgoing directors and advisors for their valuable guidance and encouragement throughout the process." In connection with TLC Vision's completion of its financial restructuring, the Company announced a new Board of Directors whose members are: -- Brandon C. White, Managing Director, Charlesbank Capital Partners, LLC -- Joshua A. Klevens, Vice President, Charlesbank Capital Partners, LLC -- Tim R. Palmer, Managing Director, Charlesbank Capital Partners, LLC -- Timothy B. Armstrong, Managing Director, H.I.G. Capital, LLC -- Brian D. Schwartz, Managing Director, H.I.G. Capital, LLC "We welcome our new Board of Directors and look forward to benefitting from their guidance and experience as we set a course toward future growth," said Tiffany. The existing directors of TLC Vision Corporation have resigned as directors in accordance with terms of the Plan. About TLC Vision Based in Chesterfield, Mo., TLC Vision Corporation -- 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, TLC Vision maintains leading positions in Refractive, Cataract and Eye Care markets. TLC Vision Corporation and two of its wholly owned subsidiaries, TLC Vision (USA) Corporation, and TLC Management Services, Inc. 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. TOWING AND RECOVERY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Towing and Recovery Professionals of Louisiana Trust 6513 Perkins Road Baton Rouge, LA 70808 Bankruptcy Case No.: 10-10707 Chapter 11 Petition Date: May 17, 2010 Court: United States Bankruptcy Court Middle District of Louisiana (Baton Rouge) Debtor's Counsel: Gary K. McKenzie, Esq. E-mail: gmckenzie@steffeslaw.com William E. Steffes, Esq. E-mail: bsteffes@steffeslaw.com Steffes, Vingiello & McKenzie, LLC 13702 Coursey Boulevard Building 3 Baton Rouge, LA 70817 Tel: (225) 751-1751 Fax: (225) 751-1998 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/lamb10-10707.pdf The petition was signed by W.R. Smith IV, chairman of the board of trustees. TRIBUNE CO: Rejecting Contract with Dun & Bradstreet ---------------------------------------------------- Tribune Company seeks the U.S. Bankruptcy Court's authority to reject a master agreement dated as of January 28, 2004, and related preferred pricing plan dated January 1, 2006, with Dun & Bradstreet. Dun & Bradstreet is a provider of business information, including information concerning a company's trade experience, historical finances, sales volume, trends, employee headcount, and prediction model scores. Tribune utilizes Dun & Bradstreet's software to monitor commercial information and business records to evaluate current and potential advertising customers for creditworthiness. On January 28, 2004, Tribune and Dun & Bradstreet entered into the Master Agreement, which granted Tribune a non-exclusive, non- transferrable license to use certain information and software provided by Dun & Bradstreet. Under the Master Agreement, Tribune was required to pay for Dun & Bradstreet's services at an annual rate on an installment plan for unlimited contractual usage. Tribune and Dun & Bradstreet entered into the Preferred Pricing Plan on January 1, 2006, for an initial three year term. Under the Preferred Pricing Plan, Tribune purchased an unlimited data plan for itself and certain of its subsidiaries for access to Dun & Bradstreet's services. The Preferred Pricing Plan included the right to cancel the contract if notice of intent to terminate were properly served on Dun & Bradstreet at least 30 days prior to the end of the three year term. However, if Tribune did not serve notice of intent to terminate, the Preferred Pricing Plan would automatically renew for an additional three years. Representing the Debtors, Patrick J. Reilley, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware, relates that Tribune did not serve notice on Dun & Bradstreet that it intended to terminate the Agreement in the 30 days prior to the end of the first three year term. Under the terms of the Preferred Pricing Plan, Tribune is required to pay 112% of the preceding year's price term for each additional year under the renewed Preferred Pricing Plan. According to Mr. Reilley, Tribune paid all amounts outstanding under the 2009 term in a timely manner. Mr. Reilley tells the Court that over the past several months, Tribune has been evaluating the relative costs and benefits associated with the Agreement, as well as Tribune's ability to obtain similar services from other providers. Tribune has determined it can obtain alternative services that offer similar features and options at a much lower price, from another provider. Accordingly, the Debtor asserts, the Agreement is no longer beneficial or necessary to Tribune's or its subsidiaries' business operations. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on 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: Chadbourne & Parke Bills $1.5 Million for March Work ---------------------------------------------------------------- Pursuant to Sections 330 and 331 of the Bankruptcy Code, these professionals hired in Tribune Co.'s bankruptcy cases filed interim fee applications: A. Professionals of the Debtors: Professional Period Fees Expenses ------------ --------- ------- -------- Seyfarth Shaw LLP 10/01/09- 11/30/09 $174,768 $6,971 Seyfarth Shaw LLP 12/01/09- 02/28/10 313,576 12,061 Dow Lohnes PLLC 03/01/10- 03/31/10 150,314 1,336 Stuart Maue 03/01/10- 03/31/10 46,575 344 Thomas & LoCicero PL 11/01/09- 01/31/10 168,370 106 Stuart Maue is the fee examiner. Seyfarth Shaw serves as employment litigation counsel to the Debtors. Dow Lohnes serves as special counsel to the Debtors. Thomas & LoCicero serves as ordinary course litigation counsel to the Debtors. The Debtors certified to the Court that no objections were filed as to these professionals' fee applications: Professional Period ------------ ----------------- Sidley Austin LLP 02/01/10-02/28/10 McDermott Will & Emery LLP 10/01/09-10/31/09 McDermott Will & Emery LLP 11/01/09-11/30/09 Cole, Schotz, Meisel, Forman & Leonard, P.A. 02/01/28-02/28/10 Daniel J. Edelman, Inc. 02/01/10-02/28/10 B. Professionals of the Official Committee of Unsecured Creditors: Professional Period Fees Expenses ------------ --------- ------- -------- Chadbourne & Parke LLP 03/01/10- 03/31/10 $1,494,305 $110,300 Landis Rath & Robb LLP 03/01/10- 03/31/10 153,590 1,362 AlixPartners, LLP 03/01/10- 03/31/10 401,797 4,845 Committee Members 03/01/10- 03/31/10 - 4,335 Zuckerman Spaeder LLP 03/01/10- 03/31/10 170,159 309,048 Chadbourne & Parke and Landis Rath serve as the Committee's co- counsels. AlixPartners is the Committee's financial advisor. Zuckerman serves as the Committee's counsel. The Committee certified to the Court that no objections were filed as to Moelis & Company LLC's fee application for the period from February 1 to February 28, 2010. Fee Examiner's Report Stuart Maue, as fee examiner, recommends approval of fees for $256,368 and reimbursement of expenses for $17,090 to Cole, Schotz, Meisel, Forman & Leonard, P.A., for the period from March 1 to May 31, 2010. Cole Schotz's recommended fees reflect a reduction by $192. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on 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: Media Unit Makes Management Promotions -------------------------------------------------- Tribune Media Services, a leading international provider of entertainment listings and information services for media and technology companies, disclosed several promotions for members of its senior management team and key business leaders. "TMS is fortunate to have a very experienced, driven management team that has worked together for PR Toolkit powered by PR Newswire many years," said David D. Williams, President/CEO of TMS. "These promotions recognize the vital roles these leaders have played in helping TMS experience extraordinary growth over the last decade, now serving over 4,000 customers in 40 countries." These members of the TMS' senior management team were promoted into the positions noted: * Jay Fehnel to Sr. Vice President and COO, Entertainment Products, from VP, Entertainment Products. * Mike Gart to Sr. Vice President, Finance and CFO, TMS, from VP, Finance and CFO, TMS. * Walter Mahoney to Sr. Vice President, MCT Global Information Services, from VP, MCT Global Information Services. * John Zelenka to Sr. Vice President, Business Development and News & Features, from VP, Business Development and News & Features. These members of the TMS Entertainment Products Division management team were promoted into the positions noted: * Rebecca Baldwin to Vice President & General Manager, Zap2it.com, from General Manager, Zap2it.com. * Ken Carter to Vice President and Managing Director, International Entertainment Information, from Managing Director, International. * Dana Gage to Vice President, Marketing, Entertainment Products, from Executive Director, Division Marketing. * John Kelleher to Vice President & General Manager, Entertainment Information, from General Manager, Entertainment Information. * Lanna Langlois to Vice President, Finance, Entertainment Information, from Executive Director, Finance. * Kathy Tolstrup to Vice President, Sales & Marketing, Entertainment Information, from General Manager, Sales and Marketing, Entertainment Information. Also, Tribune Technology said that Melissa White, who leads TMS' information technology team, has been promoted to Managing Director, Technology Architect, from Executive Director, Information Technology. "TMS continues to attract new blue-chip customers around the world," Williams said. "We are fortunate to have such an experienced, customer-focused leadership team to oversee our continued investments in product development and technology." About Tribune Media Services Tribune Media Services (TMS), a subsidiary of Tribune Company, is a leading provider of information and entertainment products for print, electronic and on-air media in the United States and abroad. It distributes TV and movie listings and related editorial content under the TMS and Zap2it brands; syndicates comics, editorial cartoons, features and opinion columns; creates and distributes a variety of online information products; licenses editorial content from national periodicals; and manages national advertising networks. TMS also markets news, features, information graphics and multimedia content to media clients around the world through the McClatchy-Tribune Information Services. For more information, visit www.TribuneMediaServices.com. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on 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) UNIFI INC: Files Form 10-Q for Period March 28 Quarter ------------------------------------------------------ Unifi Inc. filed with the Securities and Exchange Commission its Form 10-Q for the quarterly period ended March 28, 2010. The Company reported net sales of $154.7 million for the third quarter of fiscal year 2010, an increase of $35.6 million or 29.9% compared to the prior year quarter and $12.4 million or 8.7% compared to the December 2009 quarter. Net sales were positively impacted by improved market conditions across all of the Company's key segments, as well as continued growth in Brazil. The Company's balance sheet showed $497.0 million in total assets, $60.0 million in total liabilities, $178.7 million in Notes payable, $2.7 million in Other long-term debt and liabilities, and $261,000 in Deferred income taxes, for a $255.2 million in shareholders' equity. The Company reported net income of $771,000 or $0.01 per share for the third quarter of fiscal year 2010 compared to a net loss of $33.0 million or $0.53 per share for the prior year quarter. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?61ff About Unifi Unifi, Inc. (NYSE: UFI) -- http://www.unifi.com/and http://www.repreve.com/-- is a diversified producer and processor of multi-filament polyester and nylon textured yarns and related raw materials. The Company adds value to the supply chain and enhances consumer demand for its products through the development and introduction of branded yarns that provide unique performance, comfort and aesthetic advantages. Key Unifi brands include, but are not limited to: AIO(R) - all-in-one performance yarns, SORBTEK(R), A.M.Y.(R), MYNX(R) UV, REPREVE(R), REFLEXX(R), MICROVISTA(R) and SATURA(R). Unifi's yarns and brands are readily found in home furnishings, apparel, legwear, and sewing thread, as well as industrial, automotive, military, and medical applications. As reported by the Troubled Company Reporter on November 20, 2009, Moody's Investors Service revised Unifi, Inc.'s ratings outlook to stable from negative. Moody's affirmed the company's Caa1 Corporate Family and Probability of Default Ratings, and the Caa2 rating on its senior secured notes due 2014. UNIVERSAL HEALTH: Fitch Cuts IDR to 'BB'; Now Under Watch Negative ------------------------------------------------------------------ Fitch Ratings has downgraded Universal Health Services' (UHS) Issuer Default Rating (IDR) to 'BB' from 'BBB', and has placed the company's ratings on Rating Watch Negative. The downgrade and Rating Watch Negative also apply to UHS's security ratings as follows: --Senior unsecured notes downgraded to 'BB' from 'BBB'; and --Unsecured bank facility downgraded to 'BB' from 'BBB'. The ratings apply to approximately $605 million of debt outstanding as of March 31, 2010. The rating action follows UHS's announcement that it has agreed to acquire Psychiatric Solutions, Inc for $3.1 billion, including $2 billion in cash and the assumption of $1.1 billion of net debt of Psychiatric Solutions. Subject to regulatory approvals and Psychiatric Solutions shareholder approval, the transaction is expected to close in the fourth quarter of 2010. The transaction is expected to be entirely debt funded. UHS has obtained commitments for a $4.15 million senior secured bank credit facility comprising a $500 million term loan A, a $2.85 billion term loan B and an $800 million credit revolver. Fitch expects $3.6 billion of the credit facility to be drawn to fund the transaction as follows: $2 billion to purchase Psychiatric Solutions equity, $1.1 billion to retire Psychiatric Solutions outstanding debt, $300 million to refinance outstanding debt of UHS and $200 million to fund transaction fees. Pro forma for the transaction, Fitch expects UHS to have approximately $4.1 billion in outstanding debt including $3.6 million on the new credit facility and $450 million of its existing senior unsecured notes due 2011 and 2016. The senior unsecured note indenture requires that the notes become secured upon the occurrence of liens in excess of 10% of consolidated net tangible assets. Based on this, if the notes remain outstanding after the transaction, Fitch expects they will likely become secured. The transaction will significantly impact UHS's operating and credit metrics. Following the transaction, UHS will generate in the area of $1.1 billion of EBITDA annually, including about $330 million contributed by Psychiatric Solutions. Based on these expectations, debt is expected to equal between 3.5 times (x) and 4.0x EBITDA. In contrast, based on its current capital structure, UHS's debt-to-EBITDA equaled 1.2x as of March 31, 2010. As a result of the increase in pro forma debt leverage, Fitch is downgrading UHS's IDR by three-notches to 'BB' at this time. Placement of the ratings on Negative Watch indicates that there is the potential for further ratings downgrades, and Fitch expects to resolve the Negative Watch prior to the close of the transaction. Any potential further downgrade to UHS's ratings is likely to be limited to one notch. Credit risk related to higher debt leverage to complete the transaction is partly offset by the anticipated benefits to UHS's operating profile. The acquisition will significantly expand the company's presence in the behavioral health sector. Prior to the transaction, UHS's behavioral health segment contributed about 25% of the company's revenues and about 35% of its EBITDA. Fitch estimates that post acquisition the contribution of the behavioral segment will increase to 45% of revenues and 55% of EBITDA. UHS's behavioral health segment provides operational diversification that is unique among for-profit hospital providers. In general, relative to the acute care hospital segment, behavioral health operations are more profitable, exhibit less volatility in patient volumes and revenues and are less vulnerable to certain challenges faced by the acute care segment, including high levels of uncompensated care. In addition, the acquisition will increase UHS's geographic diversity, ameliorating credit risk related to its high degree of exposure to the Las Vegas, NV market, which represented about 22% of revenues in 2009. VERTIS HOLDINGS: Extends Expiration Dates of Exchange Offers ------------------------------------------------------------ Vertis Holdings, Inc. disclosed the extension of the expiration dates in connection with its principal operating subsidiary Vertis, Inc.'s previously commenced (i) private exchange offer, tender offer and consent solicitation relating to its 13-1/2 percent Senior Pay-in-Kind Notes due 2014, and (ii) private exchange offer and consent solicitation relating to its 18-1/2 percent Senior Secured Second Lien Notes due 2012 from midnight, New York City time, on May 20, 2010, to midnight, New York City time, on June 11, 2010. The extension is intended to provide Vertis with additional time to consummate its refinancing. Holdings also announced that Vertis will pay the same consideration to holders of the Notes who validly tender their Notes in the applicable Offers at or prior to the New Expiration Time that was offered to holders of Notes who validly tendered, and did not validly withdraw, their Notes in the applicable Offers at or prior to midnight, New York City time, on May 20, 2010, in order to provide prospective participants in the Offers additional time to consider tendering their Notes and receive such consideration. As of 5:00 p.m., New York City time, on May 19, 2010, approximately $204.8 million aggregate principal amount of the Senior Notes were validly tendered in the Senior Notes Offer and the related consents thereby delivered, and not validly withdrawn. Of the total Senior Notes validly tendered in the Senior Notes Offer, approximately $177.0 million aggregate principal amount were tendered for Holdings' common stock and approximately $27.8 million aggregate principal amount were tendered for cash, representing approximately 73 percent and 12 percent, respectively, of the outstanding principal amount of the Senior Notes. In addition, as of 5:00 p.m., New York City time, on May 19, 2010, approximately $357.0 million aggregate principal amount of the Existing Second Lien Notes were validly tendered in the Second Lien Notes Exchange Offer and the related consents thereby delivered, and not validly withdrawn. Pursuant to the terms of the Offers, Notes already tendered, and not validly withdrawn may no longer be withdrawn and the related consents may no longer be revoked. As previously announced, the Offers represent elements of a comprehensive $1.1 billion refinancing of substantially all of Vertis' outstanding secured and unsecured indebtedness. Upon completion of the planned transactions, Vertis will have significantly reduced its outstanding indebtedness and related interest expense and extended its debt maturity profile. The Senior Notes Offer Upon consummation of the private exchange offer for the Senior Notes, Holdings will issue 784.377 shares of its common stock and Vertis will pay a consent fee of $5.00 for each $1,000 principal amount of Senior Notes validly tendered, and not validly withdrawn, by Eligible Senior Noteholders at or prior to the New Expiration Time. The Senior Notes Exchange Offer is open only (i) in the United States to holders who are "qualified institutional buyers" or "accredited investors" as such terms are defined under the Securities Act of 1933, and (ii) outside the United States to holders who are persons other than U.S. persons in reliance upon Regulation S under the Securities Act. Upon consummation of the tender offer for the Senior Notes, Vertis will pay to Eligible Senior Noteholders and all remaining holders of Senior Notes that are not eligible to participate in the Senior Notes Exchange Offer, $400.00 for each $1,000 principal amount of Senior Notes validly tendered at or prior to the New Expiration Time. The cash consideration payable by Vertis pursuant to the Tender Offer will be funded by the sale of shares of Common Stock to Avenue Capital in a private placement. The Second Lien Notes Exchange Offer Upon consummation of Vertis' private offer to exchange its outstanding Existing Second Lien Notes for new 13 percent Senior Secured Notes due 2016, Vertis will issue $393.73 principal amount of New Secured Notes and pay $591.27 of cash for each $1,000 principal amount of Existing Second Lien Notes validly tendered, and not validly withdrawn, by Eligible Second Lien Holders at or prior to the New Expiration Time. The Second Lien Notes Exchange Offer is open only (i) in the United States to holders who are "qualified institutional buyers" or institutional "accredited investors" as such terms are defined under the Securities Act of 1933, and (ii) outside the United States to holders who are persons other than U.S. persons in reliance upon Regulation S under the Securities Act. Eligible Second Lien Noteholders validly tendering Existing Second Lien Notes at or prior to the New Expiration Time will also receive additional New Secured Notes in an amount equal to 98.5 percent of the accrued and unpaid interest due to such holders from April 1, 2010 until, but not including, the settlement date for the Second Lien Notes Exchange Offer. Vertis may elect to further extend one or both of the Offers. The Offers are subject to the terms and conditions set forth in the applicable confidential offering memorandum and consent solicitation statement (each, as supplemented, an "Offering Memorandum") and the related letters of transmittal (each a "Letter of Transmittal"), each dated April 15, 2010. Consummation of the Refinancing Transactions, including the Offers, is subject to the satisfaction or waiver by Vertis of numerous conditions set forth in the applicable Offering Memorandum and Letter of Transmittal, and we cannot assure you that they will be consummated on the terms described herein, on the timetable described herein or at all. About Vertis Holdings Inc. Headquartered in Baltimore, Maryland, Vertis Holdings, Inc. -- http://www.vertisinc.com/-- is a provider of targeted print advertising and direct marketing solutions to America's retail and consumer services companies. The company and its six affiliates previously filed for Chapter 11 protection on July 15, 2008 (Bankr. D. Del. Case No. 08-11460). In August 2008, it emerged from bankruptcy, after completing a merger with ACG Holdings. WARNER MUSIC: Posts $28 Million Net Loss for March 31 Quarter ------------------------------------------------------------- Warner Music Group Corp. reported its second-quarter financial results for the period ended March 31, 2010. The Company reported a net loss of $28.0 million on $662.0 million of revenues for the three months ended March 31, 2010, compared with a net loss of $68.0 million on $671.0 million of revenues during the same period a year ago. "This quarter provided another example of our ability to generate stable results, even in the face of continued industry-wide pressures and a limited release schedule-delivering growing OIBDA with only moderate revenue declines," said Edgar Bronfman, Jr., Warner Music Group's Chairman and CEO. "We remain on track to achieve our long-term financial and strategic goals, including driving free cash flow, developing innovative digital solutions, enhancing the value and growth of Warner/Chappell, investing in artist development and expanding our artist services business." "We continue to expect our fiscal year 2010 release schedule to be fourth-quarter weighted," Steven Macri, Warner Music Group's Executive Vice President and CFO, added. "One year after our May 2009 refinancing, our balance sheet continues to strengthen, highlighting the attractive fundamental cash characteristics of our business." For the quarter, revenue declined 1.3% to $662 million from $671 million in the prior-year quarter, and was down 6.0% on a constant-currency basis. This performance primarily reflected a light release schedule and the effects of the transition from physical sales to digital sales in the recorded music industry. In addition, continued general economic pressures have resulted in decreased discretionary spending by consumers and a reduction by retailers in the amount of floor and shelf space dedicated to music. International revenue rose 4.6%, but decreased 4.5% on a constant- currency basis, while domestic revenue declined 7.1%. Revenue growth in the U.K. was offset by weakness in the U.S., Asia and the rest of Europe. Digital revenue of $199 million grew 15.0% over the prior-year quarter, or 11.8% on a constant-currency basis. Digital revenue was up 8.2% sequentially from the first quarter of fiscal 2010, or 10.6% on a constant-currency basis, and represented 30.1% of total revenue for the quarter. Operating income grew 60.0% to $24 million from $15 million in the prior-year quarter and operating margin was up 1.4 percentage points to 3.6%. OIBDA increased 8.8% to $87 million from $80 million in the prior-year quarter and OIBDA margin expanded 1.2 percentage points to 13.1% as a result of continued cost- management efforts and leveraging our highly variable cost structure. Net loss was $25 million, or ($0.17) per diluted share, for the quarter, compared with net loss of $68 million, or ($0.45) per diluted share, in the prior-year quarter. The decline in net loss was attributable to higher operating income, a decrease in other expenses and lower taxes due to our tax planning efforts, partially offset by increased interest expense. In the prior-year quarter, other expenses included charges of $29 million related to the previously disclosed impairment of cost-method investments. The Company's balance sheet at March 31, 2010, showed $3.7 billion in total assets and $3.8 billion in total liabilities, for a $116.0 million total stockholders' deficit. As of March 31, 2010, the company reported a cash balance of $383 million, total long-term debt of $1.93 billion and net debt of $1.55 billion. Net cash provided by operating activities was $93 million compared to $144 million in the prior-year quarter. The decline was primarily related to lower year-over-year sales and the timing of sales and collections versus the prior year. Free Cash Flow of $54 million took into account $31 million in cash used for Music Publishing investments, including two previously announced Warner/Chappell production music acquisitions. Free Cash Flow in the comparable fiscal 2009 quarter was $125 million. Unlevered After-Tax Cash Flow was $54 million, compared to $156 million in the comparable fiscal 2009 quarter. Following the company's May 2009 refinancing, all of the company's cash interest payments are made semi-annually in the first and third quarters of the fiscal year. As a result, there was no cash interest in the quarter, compared to $31 million in the prior-year quarter. The company previously made quarterly interest payments under its senior secured credit facility, which was retired in May 2009. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62a2 About Warner Music Group Based in New York, Warner Music Group Corp. (NYSE: WMG) -- http://www.wmg.com/-- was formed by a private equity consortium of investors on November 21, 2003. The Company is the direct parent of WMG Holdings Corp., which is the direct parent of WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's major music-based content companies and the successor to substantially all of the interests of the recorded music and music publishing businesses of Time Warner Inc. The Company classifies its business interests into two fundamental operations: Recorded Music and Music Publishing. The Company's Recorded Music business primarily consists of the discovery and development of artists and the related marketing, distribution and licensing of recorded music produced by such artists. The Company's Music Publishing operations include Warner/Chappell, its global Music Publishing company, headquartered in New York with operations in over 50 countries through various subsidiaries, affiliates and non-affiliated licensees. WASHINGTON MUTUAL: Disclosure Statement Hearing Moved to June 3 --------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that Washington Mutual Inc. told the bankruptcy judge handling its case that it is nearing an agreement with the Federal Deposit Insurance Corp. on a global settlement over deposits and tax refunds. The hearing for approval of a disclosure statement explaining the bank's Chapter 11 plan was pushed back to June 3. Washington Mutual has already filed an amended reorganization plan that contemplates the implementation of a global settlement agreement among WMI, the Federal Deposit Insurance Corporation and JPMorgan Chase Bank, N.A. The Plan, under which the Settlement will be implemented, contemplates, among other things: -- WMI will establish a liquidating trust to make distributions to creditors on account of their allowed claims. In accordance with the terms of the Plan, the trust will distribute funds in excess of approximately $7 billion, including approximately $4 billion of previously disputed funds on deposit with JPMC. -- It is anticipated that the reorganized WMI will undertake a rights offering pursuant to which certain creditors will receive a right to purchase newly issued shares of reorganized WMI common stock. The reorganized WMI will retain equity interests in WMI Investment Corp. and WM Mortgage Reinsurance Company. -- JPMC will assume certain liabilities related to benefit Plans (including the pension plan sponsored by WMI). -- The various litigations involving WMI, JPMC and FDIC will be stayed or dismissed. In addition, JPMC and the FDIC (in its capacity as receiver of Washington Mutual Bank and in its corporate capacity) will withdraw claims against WMI's bankruptcy estate and the parties will exchange mutual releases. -- Preferred and common equity securities previously issued by WMI will be cancelled. 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). WASHINGTON MUTUAL: Equity Holders Unsatisfied With Plan Revisions ----------------------------------------------------------------- According to Bankruptcy Law360, equity security holders in Washington Mutual Inc. are challenging the collapsed bank's disclosure statement despite recent revisions made in light of an agreement to settle several multibillion-dollar disputes, saying it continues to lack information necessary to understand the proposed "illusory" deal. Law360 relates the official committee of equity security holders said in a filing Tuesday in the U.S. Bankruptcy Court for the District of Delaware that a "substantial amount of information" remains lacking. 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). WASHINGTON MUTUAL: Objects to AT&T's $8.96 Million Claim -------------------------------------------------------- Washington Mutual, Inc., and AT&T Corp. are parties to a Master Services Agreement, whereby AT&T provided certain telecommunication services to WaMu and its subsidiaries. The U.S. Bankruptcy Court authorized the rejection of the Agreement as of March 30, 2009. As a result of the rejection, AT&T filed a claim asserting damages for $8,961,792. Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington Delaware, says AT&T based the amount of its Claim on termination charges due as set forth in the amendments to the Agreement when the corresponding service was terminated before the termination of the contractual term under the Amendments. According to Mr. Collins, AT&T calculated the rejection damages by multiplying the monthly recurring charge for a particular service by the months remaining in the term for that service, multiplying that amount by any applicable reduction/discount factor for that service, and adding to the resulting amount any waived installation charges for that service. Mr. Collins maintains that the Agreement clearly specified that penalties for termination were to be calculated based on contractual minimum commitments, which the Debtors satisfied in full. Thus, the only expected damages that AT&T would have been entitled to are a month's recurring charges for the services provided pursuant to the Amendments cited by AT&T in their damages calculation, he asserts. AT&T already mitigated its damages by entering into a new agreement for similar services with JPMorgan Chase before the effective date of the Debtors' rejection of the Agreement, Mr. Collins tells the Court. In addition, AT&T's Claim is based on term commitments in the Amendments that do amend the Agreement, Mr. Collins points out. However, the parties acknowledge in the Agreement that minimum commitments in any Service Attachment will not be deemed to increase a Minimum Term Revenue Commitment or "MTRC" or Minimum Annual Revenue Commitment or "MARC" and may only be added by a written amendment, he notes. Against this backdrop, AT&T cannot now rely on term commitments buried in other Service Attachments, Mr. Collins contends. Similarly, AT&T cannot construe the Service Attachments to be separate agreements imposing additional commitments upon WaMu, he stresses. Since WaMu has satisfied the MTRC and MARCs and the express terms of the Agreement provide no guarantee of continued revenue from WaMu beyond the MTRC, AT&T cannot now assert to be entitled to any rejection damages, Mr. Collins maintains. Against this backdrop, the Debtors seek the disallowance of AT&T's Claim. 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). WASHINGTON MUTUAL: Equity Panel Proposes Susman as Counsel ---------------------------------------------------------- The Official Committee of Equity Security Holders in Washington Mutual Inc.'s Chapter 11 cases seeks the U.S. Bankruptcy Court's authority to retain Susman Godfrey LLP as its counsel, nunc pro tunc to April 16, 2010. The Equity Committee says that in rendering legal services, Susman Godfrey will coordinate with Ashby & Geddes, the Equity Committee's Delaware counsel, to avoid any duplication of effort and expense. Susman Godfrey's professionals will be paid according to their customary hourly rates. Susman Godfrey's principal attorneys designated to represent the Equity Committee and their customary hourly rates are: Professional Position Rate per Hour ------------ -------- ------------- Stephen D. Susman Partner $1,100 Parker C. Folse III Partner $750 Edgar Sargent Partner $450 Justin Nelson Partner $475 Seth Ard Associate $250 Susman Godfrey will also seek reimbursement of necessary expenses incurred. Mr. Sargent, a partner at Susman Godfrey, discloses that his firm represents EMC Corporation and TPG Capital L.P. in certain litigation cases unrelated to the Debtors. He also relates that in March 2009, representatives of the Debtors had discussions with Susman Godfrey's partners H. Lee Godfrey, Esq., and Parker Folse, Esq., about the potential retention of the firm to represent the Debtors in pursuing claims in litigation. The Debtors ultimately decided not to retain Susman Godfrey. During the discussions that occurred, the Debtors did not share any confidential information with Susman Godfrey other than a description of the claims the Debtors were interested in pursuing, he notes. Susman Godfrey represents and has represented certain of the non- debtor entities in non-related matters, according to Mr. Sargent. Susman Godfrey also represented, represents, and may represent entities that may be claimants or interest holders of the Debtors in matters unrelated to the Debtors' Chapter 11 cases, he states. Similarly, Susman Godfrey has been adverse to, is adverse to, and may be adverse to claimants or interest holders of the Debtors in matters unrelated to the Debtors' Chapter 11 cases, he adds. Despite these disclosures, Mr. Sargent maintains that Susman Godfrey does not hold or represent an interest that is adverse to the Debtors' estates. He assures the Court that Susman Godfrey is a "disinterested person" as the term is defined under Section 101(14) of the Bankruptcy Code. The Court will consider the Equity Committee's employment application on May 19, 2010. 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). WASHINGTON MUTUAL: Willingham & Esopus Sue to Compel Annual Meet ---------------------------------------------------------------- Michael Willingham and Esopus Creek Value LP, both shareholders of Washington Mutual Inc., commenced a complaint in the Thurston County Superior Court in the state of Washington on April 26, 2010, to compel WaMu to convene an annual shareholders' meeting for the nomination and election of directors. Mr. Willingham is a resident of Pittsburg, Texas. He is deemed to beneficially own approximately 1,030,000 shares of WaMu common stock. Esopus Creek is a New Jersey hedge fund, who is deemed to beneficially own 100,000 shares of WaMu common stock and 15,000 shares of WaMu preferred stock. Both Shareholders are members of the Official Committee of Equity Security Holders in the bankruptcy cases of WaMu and WMI Investment Corp. currently pending in the U.S. Bankruptcy Court for the District of Delaware. The Bankruptcy Court earlier granted the Equity Committee permission to take legal action to force WaMu to hold an annual meeting, noting that bankruptcy law doesn't prohibit the equity holders to file such an action. The last shareholders meeting held by WaMu was on April 20, 2008. The Shareholders also ask the Thurston Court to designate the time and place of the annual meeting, as well as the form of the notice of the meeting to be delivered to all shareholders by WaMu. The Shareholders' aim is to "elect a board of directors that would pursue rather than settle litigation against the Federal Deposit Insurance Corp. and JPMorgan" in relation to the 2008 sale of Washington Mutual Bank, The Seattle Times points out. Bankruptcy Court's Permission Bankruptcy Judge Marcy Walrath earlier permitted the Official Committee of Equity Security Holders in Washington Mutual Inc.'s cases to take necessary action to compel Washington Mutual, Inc., to hold a shareholders' meeting and allow WaMu shareholders to vote on a new slate of directors. "The automatic stay imposed by operation of section 362 of the Bankruptcy Code is inapplicable to an action by any one or more shareholders of [WaMu], including, without limitation, members of the Equity Committee, in the state courts of the State of Washington seeking to compel WaMu to hold an annual shareholders meeting," the Court ruled. The Court Order, however, is without prejudice to the rights of WaMu, and neither affects, nor is intended to affect, the rights of the Debtors, Judge Walrath clarified. Prior to the entry of the Court's ruling, the Equity Committee said that the Debtors' objection to their request reveals exactly why a shareholder meeting is necessary. "Without any type of shareholder input in corporate governance since well before the bankruptcy, WaMu is attempting to settle its most significant outstanding claims while leaving shareholders with nothing," the Equity Committee asserted. WaMu held its last annual meeting and voted for the selection of the members of its Board of Directors on April 20, 2008. 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). WASHINGTON MUTUAL: OTS "Scolded" at Senate Hearing -------------------------------------------------- The Senate panel "berated" officials of the Office for Thrift Supervision for taking a hands-off approach toward Washington Mutual, Inc., while actively fending off tighter scrutiny by the Federal Deposit Insurance Corp., the Seattle Times reported on April 17, 2010. At a hearing before the U.S. Senate's Permanent Subcommittee on Investigations on April 17, Chairman Sen. Carl Levin, D-Mich., read a list of criticisms of WaMu's lending practices and risk management expressed over a five-year period by examiners for the OTS, according to the report. Senator Levin threw questions at John Reich, OTS head from 2005 until 2009, clarifying whether "[there was] not one single formal enforcement action against WaMu from 2004 to 2008," the newspaper said. FDIC Chairwoman Sheila Bair disclosed that WaMu's liquidity had "declined to $4.4 billion, a dangerously low level" for Washington Mutual Bank by September 27, 2008, when regulators seized the Bank. Ms. Bair further disclosed that "OTS regulators in 2006 and later blocked her examiners from accessing WaMu data," according to the report. 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). WASHINGTON MUTUAL: Objects to Oregon's $29.3 Million Claim ---------------------------------------------------------- Washington Mutual Inc. and its units ask Bankruptcy Judge Mary Walrath to expunge Claim No. 3693 for $29,381,722 filed by The Oregon Department of Revenue. Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, relates that the Oregon DOR filed Claim No. 3693 in May 2009 for excise taxes, interest and penalties related to tax years 1999 through 2006. As more fully provided in an Assessment Letter dated December 18, 2009, the Oregon DOR issued notices of assessment to Washington Mutual Bank and certain of its subsidiaries for assessments "based on adjustments made to the tax liability of Washington Mutual entities doing business in Oregon." The Assessment Letter further provides that the Oregon DOR's audit adjustments focused on these WMB entities: WMB, WMBfsb, Marion Street, Inc., Seneca Street, Inc., University Street, Inc., and Snoqualmie Asset Fund, Inc. The Oregon DOR acknowledges under the Assessment Letter that each of the WMB Entities doing business in Oregon is no longer a subsidiary of WaMu. Nevertheless, the Oregon DOR asserts that pursuant to certain Oregon statutes, WaMu is jointly and severally liable for taxes owed by the WMB Entities, because WaMu and the WMB Entities filed a consolidated state tax return. Claim No. 3696 seeks payment for taxes assessed against entities other than the Debtors and accordingly, should be disallowed and expunged, Mr. Collins asserts. In addition, because the WMB Entities are the proper entities against which Claim No. 3696 should be asserted, the Debtors object to the allowance of Claim No. 3696. Oregon DOR Responds Contrary to the Debtors' assertion, Claim No. 3696 asserts taxes that were assessed against Washington Mutual Inc., and its subsidiaries as taxpayers who filed the tax returns, Carolyn G. Wade, Esq., Senior Assistant Attorney General at the Oregon Department of Justice, in Salem, Oregon, explains. Pursuant to Oregon law, all corporations included in a consolidated state tax return relate to "joint and several liability," Ms. Wade points out. Moreover, under the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution, a state may tax interstate activities when there is at least a minimum connection between the state and the activity being taxed, and the income taxed by the state is rationally related to the benefits provided by the taxing state, MS. Wade says, citing Quill Corp. v. North Dakota, 504 US 298, 308, 112 S Ct 1904, 119 L Ed 2d 91 (1992). In other words, Ms. Wade explains, in taxing income derived from or connected with sources in the Oregon State, the Due Process Clause limits the state to taxation of income of non-residents or foreign corporations to the extent the activity producing the income has a connection with the State and where the State provides protections and benefits which enable the production of that income. Oregon may tax the income of WaMu "to the extent that the taxpayer has a substantial nexus with the taxing state, the tax is fairly apportioned so as to tax income attributable to economic activity within Oregon, the tax does not discriminate against non-residents, and the income tax is fairly related to the benefits Oregon provides to the taxpayer," Ms. Wade concludes. 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). WESTAR ENERGY: Moody's Affirms Ba2 Preferred Stock Rating --------------------------------------------------------- Moody's Investors Service changed the rating outlooks of Westar Energy Inc., and, its wholly-owned subsidiary, Kansas Gas & Electric Company to positive from stable and affirmed Westar's and KG&E's Baa1 senior secured and Baa3 long-term issuer ratings, and Westar's Ba2 preferred stock rating. The rating actions reflect Westar's improving financial performance as of late, which was driven by the benefits provided by a series of rate relief , cost management initiatives, and a step-down in 2009, capital spending. Westar generated consolidated cash from operations (pre-working capital) to debt of 15.2% and 14.9% for the trailing twelve months ended March 31, 2010, and year ended 2009, respectively, compared to 12.8% registered in 2008. In 2009, Westar introduced approximately $200 million of rate increases into its operating structure, including its $130 million general rate case settlement with the Kansas Corporation Commission (effective February 2009,) and approximately $64 million in cost recovery mechanisms through various trackers and cost riders. These revenues, along with cost and capital management throughout the year helped to mitigate the negative financial impact of a 4.3% decline in total retail sales during 2009,. Factors in the decline included the notably cooler summer and general recessionary pressures including a 10.8% decline in industrial sales. The rating action also considers the expected benefits to earnings and cash flow from approximately $48 million of additional rate increases and various trackers that are expected to become effective in 2010, which should help to further strengthen near-term credit metrics. The positive rating outlook incorporates an expectation that Westar's management will continue to maintain a strong balance sheet by periodically issuing equity when needed to fund higher levels of capital spending, as it has done so in the past. Between 2007 and 2008, Westar issued roughly $489 million of common equity to support its capital investment program. Over the 2010,--2012 time frame, approximately $946 million, or 40%, of Westar's $2.4 billion planned capital expenditures, is for environmental stewardship. This spending will address several initiatives with the goal of reducing emissions at Westar's predominately coal fired fleet. Importantly, Westar has the ability to recover these costs on a timely basis through its environmental cost recovery rider, which helps to reduce recovery lag. The outlook also considers that as Westar carries out its capital program, including its expected investments in new transmission related projects, the current credit supportive relationship that we believe exists between Westar and the KCC will continue. The last rating action was on August 3, 2009, when Westar and KGE's senior secured ratings were upgraded one notch to Baa1 in line with our sector-wide review of first mortgage bonds. Westar Energy is an integrated electric utility headquartered in Topeka, Kansas. The company, along with its principal subsidiary, Kansas Gas & Electric, serves approximately 685,000 customers in the state and reported revenues of $1.9 billion for the twelve- month period ended March 31, 2010,. WILLBROS GROUP: Moody's Assigns B3 on Proposed Sr. Secured Notes ---------------------------------------------------------------- Moody's Investors Service assigned a B3 rating to Willbros Group Inc.'s proposed second priority senior secured notes issue and upgraded the first priority senior secured rating of Willbros United States Holdings, Inc.'s bank credit facilities to Ba3 from B2. At the same time, Moody's affirmed the B2 corporate family rating, the B2 probability of default rating, the SGL-3 speculative-grade liquidity rating, and the stable ratings outlook for Willbros United States Holdings, Inc. and repositioned these ratings to the parent company, Willbros. The rating action reflects Willbros' revised financing plan for the acquisition of InfrastruX Group, Inc. In place of the previously proposed $300 million first priority term loan 'B' Willbros now plans to reduce the term loan 'B' to $50 million and issue $250 million of second priority senior secured notes. With total rated debt remaining unchanged, the updated financing plan has no immediate impact Willbros' B2 corporate family rating. The upgrade to the bank credit facility ratings (now consisting of the $50 million term loan B and $175 million revolver) reflect the benefits of their first priority lien on the company's assets as well as their senior ranking ahead of the $250 million proposed notes. The B3 rating on the proposed notes reflects their second priority lien on assets and lack of meaningful amount of unsecured claims. Covenant headroom will improve modestly under revised thresholds now contemplated in its bank credit facility, however Willbros' liquidity rating remains constrained at SGL-3 due to a lack of near term access to its revolver for cash borrowing purposes. Issuer: Willbros Group, Inc. - Corporate Family Rating, Assigned B2 (repositioned) - Probability of Default Rating, Assigned B2 (repositioned) - 2nd Lien Senior Secured Notes, Assigned B3, LGD4, 63% - Speculative Grade Liquidity Rating, Assigned SGL-3 (repositioned) Issuer: Willbros United States Holdings Inc. - $175 million Senior Secured Revolver, Upgraded to Ba3, LGD2, 23% from B2, LGD3, 44% - $50 million Senior Secured Term Loan, Upgraded to Ba3, LGD2, 23% from B2, LGD3, 44% Moody's most recent rating action on the company was on April 9, 2010, when it assigned first-time ratings to Willbros United States Holdings Inc. Headquartered in Houston, Texas, Willbros United States Holdings Inc is a wholly-owned subsidiary of publicly traded Willbros Group, Inc. The companies provide engineering and construction services to the oil, gas and power industries. Pro-forma for the acquisition of InfrastruX, revenues totaled approximately $1.9 billion in 2009,. WORLDSPACE INC: Samara Bids $5.5 Million for Satellites ------------------------------------------------------- At the end of March this year, WorldSpace Inc. obtained approval from the U.S. Bankruptcy Court of its emergency motion to bring two satellites crashing back to earth, unless a buyer appears. WorldSpace spent six months negotiating a sale to the DIP lender, Liberty Satellite Radio, Inc., but the parties ended the talks. WorldSpace hired Intelsat SA and allocated $84,000 for the crash. Bloomberg News cited a report in Rapid TV News that Yazmi USA LLC, controlled by WorldSpace Chief Executive Officer Noah Samara, has an agreement to buy the satellites for $5.5 million. According to Bloomberg, WorldSpace says that Yazmi has demonstrated financial ability to complete the purchase. Yazmi's agreement provides $100,000 to de-orbit the satellites should the sale not be completed. Yazmi will also advance $500,000 against the purchase price to pay operating expenses before the sale closes. Mr. Samara's Yenura Pte in October 2009 defaulted on a court- approved contract to buy the assets for $28 million cash. About WorldSpace Inc. WorldSpace, Inc. (WRSPQ.PK) -- http://www.1worldspace.com/-- provides satellite-based radio and data broadcasting services to paying subscribers in 10 countries throughout Europe, India, the Middle East, and Africa. 1worldspace(TM) satellites cover two- thirds of the earth and enable the Company to offer a wide range of services for enterprises and governments globally, including distance learning, alert delivery, data delivery, and disaster readiness and response systems. 1worldspace(TM) is a pioneer of satellite-based digital radio services. The Debtors and their affiliates operate two geostationary satellites, AfriStar and Asia Star, which are in orbit over Africa and Asia. The Debtor and two of its affiliates filed for Chapter 11 bankruptcy protection on October 17, 2008 (Bankr. D. Del., Case No. 08-12412 - 08-12414). James E. O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors as counsel. Kurtzman Carson Consultants serves as claims and notice agent. Neil Raymond Lapinski, Esq., and Rafael Xavier Zahralddin-Aravena, Esq., at Elliot Greenleaf, represent the Official Committee of Unsecured Creditors. When the Debtors filed for bankruptcy, they listed total assets of $307,382,000 and total debts of $2,122,904,000. XERIUM TECHNOLOGIES: Wins Court OK for Baker as European Counsel ---------------------------------------------------------------- Xerium Technologies Inc. and its units sought and obtained the U.S. Bankruptcy Court's authority to employ Baker & McKenzie as special European corporate counsel, nunc pro tunc to March 30, 2010. As European corporate counsel, Baker will: (a) represent and advise the Debtors in relation to all jurisdictions outside of the U.S. (including, without limitation, Australia, Austria, Brazil, Canada, Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, Mexico, Sweden, United Kingdom, and Vietnam) to review, coordinate and advise on the collateral package (and related corporate in possession and exit financing and the amended second lien term loan to be entered into on the effective date of the Plan; (b) represent and advise the Debtors on and assist the Debtors in the implementation of certain intercompany transactions to be carried out under the Plan in Austria, Germany, and Italy in connection with the restructuring of the Debtors' obligations under their prepetition credit facility, proposed by the Debtors in cooperation with Ernst & Young LLP and other advisors; and (c) advise the Debtors related to their non-U.S. subsidiaries, especially in the European jurisdictions (Austria, Finland, France, Germany, Ireland, Italy, United Kingdom, Spain, Sweden, Switzerland, and in addition, occasionally in Australia, Brazil, Canada, Hong Kong, Japan, Mexico, and Vietnam), with respect to corporate, litigation, and employment matters, including, without limitation, workforce restructuring and closures, management changes (employment and corporate side), group-internal intercompany transactions, cash pool measures, board meetings, changes in articles, and general corporate legal advice with respect to day-to-day corporate housekeeping. Baker will be paid according to these hourly rates: * Partners US$270 (Mexico) to US$1,100 (Hong Kong) * Associates US$120 (Mexico) to US$850 (Hong Kong) * Para-professionals US$120 to US$340 Baker will also be reimbursed for any out-of-pocket expenses incurred. Olaf Gebler, Esq., a partner at Baker & McKenzie, assures the Court that his firm does not hold or represent any interest adverse to the Debtors or their estates and is a "disinterested person," as defined in section 101(14) of the Bankruptcy Code, as modified by Section 1107(b) of the Bankruptcy Code. About Xerium Technologies Based in Raleigh, North Carolina, Xerium Technologies, Inc. (NYSE: XRM), manufactures and supplies two types of consumable products used primarily in the production of paper: clothing and roll covers. The Company, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 32 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,300 employees. Xerium Technologies and certain subsidiaries filed for Chapter 11 on March 30, 2010 (Bankr. D. Del. Lead Case No. 10-11031). Judge Kevin J. Carey presides over the cases. John J. Rapisardi, Esq.; George A. Davis, Esq.; and Sharon J. Richardson, Esq., at Cadwalader, Wickersham & Taft LLP; and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as bankruptcy counsel. Brian Fox, Michelle Campbell, and Michael Hartley at AlixPartners, LLC, serve as the Debtors' restructuring advisors. Stephen Ledoux and Daniel Gilligan at Rothschild Inc. serve as the Debtors' investment bankers. Garden City Group Inc. is the Debtors' claims agent. Xerium Technologies disclosed total assets of $693,511,000 and total debts of $813,168,000 in its petition. Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware confirmed the Prepackaged Chapter 11 Plan of Reorganization filed by Xerium Technologies, Inc., and its debtor affiliates on May 12, 2010, after determining that the Plan satisfies the requirements of Section 1129(a) of the Bankruptcy Code. XERIUM TECHNOLOGIES: Can Hire AlixPartners as Financial Advisors ---------------------------------------------------------------- The U.S. Bankruptcy Court, after receiving no objection to the employment application, authorized Xerium Technologies Inc. and its units to employ AlixPartners as their financial advisor and consultant, nunc pro tunc to March 30, 2010. According to Stephen R. Light, Chairman and Chief Executive Officer at Xerium, AlixPartners has a wealth of experience in providing financial and restructuring advisory services, and enjoys an excellent reputation for services it has rendered in large and complex Chapter 11 cases on behalf of debtors and creditors throughout the United States. In addition, AlixPartners assisted the Debtors in coordinating with their various professionals, as well as in managing the prepetition Chapter 11 preparation process and public relations efforts. Consequently, AlixPartners is now familiar with the Debtors' financial affairs, debt structure, operations, and related matters. Likewise, AlixPartners' professionals have worked closely with the Debtors' management and other advisors, Mr. Light says. In accordance with a retention agreement, AlixPartners, as the Debtors' financial advisor, will: (a) provide assistance to management in connection with the Debtors' development of their revised business plan, and other related forecasts as may be required by the bank lenders in connection with negotiations or by the Debtors for other corporate purposes; (b) assist the Debtors' management and their professionals specifically assigned to sourcing, negotiating, and implementing any financing, exit financing facilities, in conjunction with the Plan and the overall restructuring; (c) advise senior management in the negotiation and implementation of restructuring initiatives and evaluation of strategic alternatives; (d) assist in preparing for and filing bankruptcy petitions, coordinating and providing administrative support for the proceeding; (e) assist with the preparation of the statement of affairs, schedules, and other regular reports required by the Court; (f) assist, as requested, in analyzing preferences and other avoidance actions, if requested; (g) manage the claims and claims reconciliation processes; (h) assist the Debtors in the development of its communications strategy for the various stakeholder constituents; (i) render an opinion on the viability of the restructuring concept of Xerium Germany Holding GmbH, which approach is based on the standard for restructuring concepts of the German Auditors Association; (j) assist in managing the "working group" professionals who are assisting the Debtors in the reorganization process or who are working for the Debtors' various stakeholders to improve coordination of their effort and individual work product to be consistent with the Debtors' overall restructuring goals; (k) assist in obtaining and presenting information required by Parties-in-interest in the Debtors' bankruptcy process including official committees appointed by the Court and the Court itself; (l) assist the Debtors in other business and financial aspects of the Chapter 11 proceeding, including, but not limited to, development of the Disclosure Statement and Prepackaged Joint Chapter 11 Plan of Reorganization; (m) provide assistance in litigation support and testimony before the Court; and (n) assist with other matters as may be requested by the Debtors, as mutually agreeable. AlixPartners' professionals will be paid in accordance with these hourly rates: Professional Hourly Rate ------------ ----------- Managing Directors $710 - $995 Directors $530 - $685 Vice Presidents $395 - $520 Associates $280 - $380 Analysts $245 - $270 Paraprofessionals $190 - $210 Brian J. Fox, a managing director at AlixPartners, will be responsible for the overall engagement and will be assisted by a staff of consultants at various levels, who have a wide range of skills and abilities related to this type of assignment, Mr. Light notes. According to Mr. Light, work performed by AlixPartners' consultants outside of North America will be charged at the standard AlixPartners non-North American local rates, converted to U.S. dollars, using fixed conversion rates established on the invoice date. Retainer and Restructuring Fees Mr. Light says that AlixPartners received an initial advance retainer of $250,000 on May 8, 2009, from the Debtors. Pursuant to the Retention Agreement, invoiced amounts have been recouped against the Retainer, and payments on the invoices have been used to replenish the Retainer. During the 90 days prior to the Petition Date, the Debtors paid AlixPartners a total of $1,225,266, incurred in providing services to the Debtors in contemplation of, and in connection with, prepetition restructuring activities, Mr. Light notes. In the Chapter 11 cases, the Debtors and AlixPartners have agreed on contingent incentive compensation in the form of a $250,000 restructuring fee based upon several specific metrics. Pursuant to a restructuring agreement, AlixPartners will receive the Restructuring Fee if the Debtors (i) amend their existing credit agreement or (ii) complete one or more transactions that substantially transfer a significant portion of the business as a going concern to another entity. The Restructuring Fee is due and payable at the closing of the Restructuring. In the event of a Change in Control, as defined in the Retention Agreement, the Restructuring Fee will be due and payable immediately prior to the Change in Control. Mr. Fox contends that AlixPartners is a "disinterested person," as defined in Section 101(14) of the Bankruptcy Code, as modified by Section 1107(b). About Xerium Technologies Based in Raleigh, North Carolina, Xerium Technologies, Inc. (NYSE: XRM), manufactures and supplies two types of consumable products used primarily in the production of paper: clothing and roll covers. The Company, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 32 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,300 employees. Xerium Technologies and certain subsidiaries filed for Chapter 11 on March 30, 2010 (Bankr. D. Del. Lead Case No. 10-11031). Judge Kevin J. Carey presides over the cases. John J. Rapisardi, Esq.; George A. Davis, Esq.; and Sharon J. Richardson, Esq., at Cadwalader, Wickersham & Taft LLP; and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as bankruptcy counsel. Brian Fox, Michelle Campbell, and Michael Hartley at AlixPartners, LLC, serve as the Debtors' restructuring advisors. Stephen Ledoux and Daniel Gilligan at Rothschild Inc. serve as the Debtors' investment bankers. Garden City Group Inc. is the Debtors' claims agent. Xerium Technologies disclosed total assets of $693,511,000 and total debts of $813,168,000 in its petition. Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware confirmed the Prepackaged Chapter 11 Plan of Reorganization filed by Xerium Technologies, Inc., and its debtor affiliates on May 12, 2010, after determining that the Plan satisfies the requirements of Section 1129(a) of the Bankruptcy Code. XERIUM TECHNOLOGIES: Elects New Members to Board of Directors ------------------------------------------------------------- Xerium Technologies, Inc.'s Prepackaged Chapter 11 Plan of Reorganization provides for, among others, the reconstitution of the Board of Directors to consist of seven directors, including the Chief Executive Officer, one director nominated by the Company's current Board, and five directors nominated by certain of the Company's lenders. On the effective date of the Plan, the Board is expected to be comprised of Stephen R. Light, Ambassador April H. Foley, Jay Gurandiano, John G. McGovern, Edward Paquette, Marc Saiontz and James F. Wilson. The Plan also provides that on the Effective Date, the Company will enter into nominating agreements with certain of its lenders. The Nominating Agreements would entitle each lender that is a party to an agreement to designate for nomination by the Company one member of the Company's Board, in accordance with the terms and conditions of the Nominating Agreements. Conditional Election of New Directors On May 4, 2010, the Board elected each of Ambassador Foley, Mr. McGovern, Mr. Saiontz and Mr. Wilson to serve as directors of the Company, effective only on the Effective Date. The new directors were conditionally elected to the Board in connection with the expected reconstitution of the Board pursuant to the Plan. The new directors were elected to fill the vacancies created by the resignations of Michael Phillips and Nico Hansen from the Board on April 15, 2010, and April 16, 2010, respectively, and the expected vacancies to be created in accordance with the Plan and the expected conditional resignations of David Maffucci and John Raos from the Board, effective on the Effective Date. If the Effective Date does not occur, the new directors will be deemed not to have been elected to the Board. Mr. Saiontz is a managing director of American Securities LLC, and Mr. Wilson is a general partner of Carl Marks Management Company. American Securities and Carl Marks are: (i) among the Company's lenders under its existing credit facility, (ii) expected to be lenders under the Company's amended and restated credit facility pursuant to the Plan, (iii) expected to be among the lenders that will nominate directors for the reconstituted Board pursuant to the Plan, and (iv) expected to each be party to a Nominating Agreement. As of May 10, 2010, the total amount outstanding under the Company's credit facility was approximately $588 million, and American Securities and Carl Marks held approximately 17.1% and 11.5%, respectively, of the outstanding loans and commitments under the facility. There is no arrangement or understanding between any of the new directors and any other persons pursuant to which any new director was elected as a director, and none of the new directors are, have been, or are currently proposed to be, participants in any related person transactions with the Company that would require disclosure under Regulation S-K item 404(a). No committee assignments have been made. The Company expects that upon joining the Board, each of the new directors would be compensated in accordance with the Company's policy for compensation of non-management directors. Conditional Resignation of Directors On May 5 and 6, 2010, respectively, Mr. Raos and Mr. Maffucci submitted their conditional resignations from the Board, each effective only as of the Effective Date. Each resignation is conditional upon the occurrence of the Effective Date, and if the Effective Date does not occur, each resignation will be deemed withdrawn. Mr. Maffucci has not resigned from any other positions with the Company or its subsidiaries, including, but not limited to, his positions as Executive Vice President and Chief Financial Officer of the Company. On April 15 and 16, 2010, respectively, Michael Phillips and Nico Hansen submitted their resignations from the Board of Directors of Xerium. About Xerium Technologies Based in Raleigh, North Carolina, Xerium Technologies, Inc. (NYSE: XRM), manufactures and supplies two types of consumable products used primarily in the production of paper: clothing and roll covers. The Company, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 32 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,300 employees. Xerium Technologies and certain subsidiaries filed for Chapter 11 on March 30, 2010 (Bankr. D. Del. Lead Case No. 10-11031). Judge Kevin J. Carey presides over the cases. John J. Rapisardi, Esq.; George A. Davis, Esq.; and Sharon J. Richardson, Esq., at Cadwalader, Wickersham & Taft LLP; and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as bankruptcy counsel. Brian Fox, Michelle Campbell, and Michael Hartley at AlixPartners, LLC, serve as the Debtors' restructuring advisors. Stephen Ledoux and Daniel Gilligan at Rothschild Inc. serve as the Debtors' investment bankers. Garden City Group Inc. is the Debtors' claims agent. Xerium Technologies disclosed total assets of $693,511,000 and total debts of $813,168,000 in its petition. Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware confirmed the Prepackaged Chapter 11 Plan of Reorganization filed by Xerium Technologies, Inc., and its debtor affiliates on May 12, 2010, after determining that the Plan satisfies the requirements of Section 1129(a) of the Bankruptcy Code. XERIUM TECHNOLOGIES: Files Amended 2009 Annual Financial Report --------------------------------------------------------------- Xerium Technologies, Inc., filed an amended annual report on Form 10-K/A for the year ended December 31, 2009, pursuant to which it incorporated by reference into Part III portions of its definitive Proxy Statement for its 2010 Annual Meeting of Shareholders. A full-text copy of the disclosure is available for free at: http://ResearchArchives.com/t/s?62c0 Based in Raleigh, North Carolina, Xerium Technologies, Inc. (NYSE: XRM), manufactures and supplies two types of consumable products used primarily in the production of paper: clothing and roll covers. The Company, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 32 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,300 employees. Xerium Technologies and certain subsidiaries filed for Chapter 11 on March 30, 2010 (Bankr. D. Del. Lead Case No. 10-11031). Judge Kevin J. Carey presides over the cases. John J. Rapisardi, Esq.; George A. Davis, Esq.; and Sharon J. Richardson, Esq., at Cadwalader, Wickersham & Taft LLP; and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., serve as bankruptcy counsel. Brian Fox, Michelle Campbell, and Michael Hartley at AlixPartners, LLC, serve as the Debtors' restructuring advisors. Stephen Ledoux and Daniel Gilligan at Rothschild Inc. serve as the Debtors' investment bankers. Garden City Group Inc. is the Debtors' claims agent. Xerium Technologies disclosed total assets of $693,511,000 and total debts of $813,168,000 in its petition. Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware confirmed the Prepackaged Chapter 11 Plan of Reorganization filed by Xerium Technologies, Inc., and its debtor affiliates on May 12, 2010, after determining that the Plan satisfies the requirements of Section 1129(a) of the Bankruptcy Code. XM SATELLITE: Posts $10.6 Million Net Income for First Quarter -------------------------------------------------------------- XM Satellite Radio Holdings Inc. filed its quarterly report Form 10-Q, showing net income of $10.6 million on $353.2 million of total revenue for the three months ended March 31, 2010, compared with a net loss of $109.9 million on $302.2 million of total revenue during the same period a year ago. The Company's balance sheet at March 31, 2010, showed $4.0 billion in total assets and $4.7 billion in total liabilities, for a stockholder's deficit of $618.5 million. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?62c4 Based in Washington, D.C., XM Satellite Radio Holdings, Inc. operates as a satellite radio service company. It provides music, news, talk, information, entertainment, and sports programming for reception by vehicle, home, and portable radios, as well as through the Internet to about 9.1 million subscribers in the United States. According to the Troubled Company Reporter on April 17, 2009, Standard & Poor's Ratings Services raised its corporate credit rating on Sirius XM Radio Inc. and XM Satellite Radio Holdings Inc. (which S&P analyzes on a consolidated basis) to 'CCC+' from 'CCC'. In accordance with this rating change, S&P also raised its issue-level ratings on the companies' debt by one notch (with the exception of Sirius XM's senior unsecured notes, which were affirmed at 'CCC-'). All of these ratings were removed from CreditWatch, where S&P placed them with positive implications on Feb. 17, 2009. The corporate credit rating outlook is stable. YEARBOOK PHOTOGRAPHY: Case Summary & Creditors List --------------------------------------------------- Debtor: Yearbook Photography of Mamaroneck, Inc. dba Davis Studio 155 White Plains Road Tarrytown, NY 10591 Bankruptcy Case No.: 10-22980 Chapter 11 Petition Date: May 17, 2010 Court: U.S. Bankruptcy Court Southern District of New York (White Plains) Judge: Robert D. Drain Debtor's Counsel: Jonathan S. Pasternak, Esq. Rattet, Pasternak & Gordon Oliver, LLP 550 Mamaroneck Avenue, Suite 510 Harrison, NY 10528 Tel: (914) 381-7400 Fax: (914) 381-7406 E-mail: jsp@rattetlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company says that assets total $933,544 while debts total $3,842,230. A copy of the Company's list of 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nysb10-22980.pdf The petition was signed by Roxanne Davis, vice president. * Three-Quarters of Distressed Exchanges May Default, Says Moody's ------------------------------------------------------------------ Many of the nearly 100 non-financial companies that defaulted through distressed exchanges in 2009 remain at risk of another default, Moody's Investors Service said in a new report. "Historically, distressed exchanges have been reasonably successful in improving issuers' creditworthiness, but it is too soon to tell if that will hold true in this cycle," said Lenny Ajzenman, a Senior Vice President at Moody's. "Although distressed exchanges helped many companies deal with near-term liquidity pressures, in many cases they were no magic bullet for the underlying problems that landed the companies in distress in the first place." About three-quarters of the Moody's-rated companies worldwide that defaulted through a distressed exchange in 2009 are currently rated Caa1 or lower. About 30% are rated Caa2 or lower, indicating high risk of near- to medium-term default, according to the report. In contrast, about one-quarter of the companies that had distressed exchanges in 2009 are rated in the higher, single-B category because their distressed exchanges addressed a large portion of their capital structure, or they saw improvements in operating performance, the report said. Moody's said it expects fewer distressed exchanges in 2010 because of a declining default rate, healthier capital markets and a nascent economic recovery. However, a surge in debt maturities from 2012 to 2014 and high debt burdens at many low-rated companies may result in another wave of distressed exchanges in the future. Distressed exchanges are debt exchanges made by distressed issuers at discounts to par which have the effect of allowing the issuer to avoid a bankruptcy filing or payment default. Last year, defaults via distressed exchange contributed to a surge in Moody's global speculative-grade default rate to 13% at the end of 2009, almost triple the 2008 year-end level. Distressed exchanges accounted for a higher-than-average 34.9% of total initial defaults in 2009, compared with 23.5% in 2008 and just 11% during the period 1983 through 2007. The full report, "Distressed-Exchange Defaults Surged in 2009, and Many Could Default Again," is available at www.moodys.com. * April Claim Trades Set New Record, SecondMarket Says ------------------------------------------------------ SecondMarket Inc., which began keeping claims trading records in January 2008, said that April this year proved to be an active month in the claims trading market. The face value of claim transfers totaled a robust $3.65B, surpassing SecondMarket's previously recorded high of $3.3B in December 2009. There were 1,086 claim transfers logged in 62 unique Chapter 11 cases, marking the third consecutive month with over 1,000 transfers. Twelve debtors had claims trade for the first time this month, including commercial aviation holding company, Mesa Air Group, Inc. The 62 unique cases in which claims were transferred represent the highest number of cases traded in the last six months. Based on the amount of claims transferred, Lehman Brothers Holdings Inc. led with $3.19 billion. Based on the number of transactions, Smurfit-Stone Container Corp. led the pack during the month. On April 14, Lehman Brothers Holdings filed its disclosure statement. The document suggests that certain of Lehman's unsecured creditors could recover approximately 15% of their claims. Lehman had 268 of its claims transferred in April amounting to a total face value of $3.19B, the highest monthly total to date. Trump Entertainment Resorts, Inc. had four claims transfer for $273MM following the confirmation of its reorganization plan. Smurfit-Stone Container had 300 of its claims transferred, which marks a decline from March, but still makes it the most transferred case this month. The average claim amount transferred rose for the second consecutive month, reaching $114,131- up from $77,900 in March. Lyondell Chemical Co. entered the top ten in number of claims transferred for the month with 25 transfers. Lyondell's reorganization plan was confirmed on April 23 and the effective date occurred on April 30. A copy of SecondMarket's Claims Trading Monthly newsletter for April is available at http://bankrupt.com/misc/1783.pdf SecondMarket calls itself the largest secondary market for illiquid assets. * Attorney Amar Agrawal Joins Scott H. Marcus & Associates ---------------------------------------------------------- Scott H. Marcus & Associates, a South Jersey law firm specializing in bankruptcy law, debt collection and mortgage modification, announces that Amar Agrawal has joined the firm as an attorney upon passing the New Jersey and Pennsylvania Bar examinations. A 2010 graduate of Rutgers School of Law in Camden, N.J., Mr. Agrawal has worked for Scott H. Marcus & Associates as a law clerk since May 2009. In his new role, he will be involved with all aspects of bankruptcy law on behalf of the firm's clients. "We are thrilled that Mr. Agrawal is now a licensed attorney. His strong legal background, sharp mind and fluency in Hindi and other languages will make him a valuable asset to the firm," said Scott H. Marcus, the firm's president. Prior to joining Scott H. Marcus & Associates, Mr. Agrawal was a senior paralegal and an administrative supervisor at a personal injury firm in Philadelphia for five years, dealing primarily with toxic torts. In addition to his degree from Rutgers School of Law, he earned a Bachelor's degree in Administration of Justice and Economics from Rutgers University in New Brunswick in 2004. Mr. Agrawal owes his fluency in Hindi and Gujarati to the 10 years he spent in India. He presently resides in Sicklerville, N.J. Established in 1984 Scott H. Marcus & Associates provides businesses and individuals with outstanding legal services in a variety of practice areas including corporate law, debt collection, bankruptcy, mortgage modification, real estate, wills and estates. Headquartered in Washington Township/Turnersville, N.J., the firm is equipped with a full staff of attorneys, paralegals, and support personnel and is committed to excellence in client service. * BOOK REVIEW: The Executive Guide to Corporate Bankruptcy ---------------------------------------------------------- Authors: Thomas J. Salerno; Craig D. Hansen; Jordan A. Kroop Publisher: Beard Books Hardcover: 728 pages List Price: $174.95 The newly revised edition of The Executive Guide To Corporate Bankruptcy is perfectly timed. As the global economy continues to deteriorate, more and more companies are sinking into insolvency with executives at their helm who need a crash course in bankruptcy realities. This excellent book will quickly get both the seasoned executive and the uninitiated lawyer up to speed on the bankruptcy process. Salerno, Kroop and Hansen understand that the reorganization process can be intimidating, puzzling, and generally unpleasant. They penetrate the opaque gloom that some lawyers tend to perpetuate. Each chapter of this book addresses a different aspect of the reorganization process, beginning with an overview of the origins and purpose of US bankruptcy laws and ending with a debunking of common myths about reorganization. In between, they discuss each chapter of the bankruptcy code; discussing the gamut from liquidations through Chapter 11 sales and full-blown reorganizations. The authors' ability to distill the bankruptcy code's complex language into comprehensible and manageable blocks of information makes the book extremely readable. The Executive Guide is full of pragmatic advice. After laying out the essential elements and key players in the restructuring process, the authors get down to the nitty gritty of navigating a distressed company through reorganization. They realistically assess the challenges that an executive should expect to face in Chapter 11. They discuss how to assuage and balance the concerns of employees and key vendors, address the inevitable creditor dissatisfaction with executive compensation, deal with members of their professional team and work effectively as an executive whose actions will be constantly scrutinized and second-guessed. The authors also provide the cautionary note that "executives preparing to embark on a reorganization are usually too preoccupied with business emergencies to think about the personal toll that the process will exact." One common flaw in books that try to be accessible while dealing with technical topics is that they fall short in providing the reader with a substantive understanding of the subject matter. The Executive Guide to Corporate Bankruptcy avoids this pitfall. The book's fourth and fifth chapters provide in-depth analysis of the strategic decisions and steps that should be taken during the restructuring process. The authors explain the importance that venue can have a case, the intricacies of first day motions and how to prepare for confirmation. There is a detailed discussion of the sale of assets during the course of a Chapter 11 restructuring and the importance of making sure that major constituencies are a part of the decision-making process. They also walk the reader through the specifics of a plan of a reorganization, explaining the dynamics of the negotiation process, especially how to understand and appreciate the needs of your constituents and how to get a plan confirmed. The icing on the cake for this book is the excellent appendix. The final section of the book includes a user-friendly glossary of commonly used bankruptcy terms and a reorganization timeline. It also includes sample documents such as debtor-in-possession (DIP) financing agreements, operating reports, first day motions and orders, management severance agreements, and more. The summary of management incentive stock plans implemented in recent restructuring transactions is particularly informative. This is a terrific book. While geared to the non-lawyer executive, it will also be a useful resource for any lawyer who wants to gain practical familiarity with the bankruptcy process. This should be a best seller in today's environment, though it may need to be delivered to most executives in a brown paper wrapper. ********* 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 ***