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/raid1/www/Hosts/bankrupt/TCR_Public/101223.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, December 23, 2010, Vol. 14, No. 355 Headlines ALFRED LI: Case Summary & 15 Largest Unsecured Creditors ALLIANZ GLOBAL: Court Grants Formal Recognition of UK Proceedings ALLIED DEFENSE: Gabelli Discloses 3.39% Equity Stake ALLIED DEFENSE: Water Island Reports 8.369% Equity Stake ALION SCIENCE: Incurs $3.34-Mil. Net Loss in Sept. 30 Quarter AMERICANWEST BANCORP: All Directors Resign Following Bank Sale AMR CORP: Form 10-Q Exhibit Treated as Confidential AMERICAN INT'L: Fairholme Capital Discloses 31.6% Equity Stake AMERICAN INT'L: Board to Decide on Preferred Bidder for Nan Shan AMERICAN INT'L: Treasury Said to Sell Shares in 2 Offerings AMERICAN MEDIA: Court Enters Order Confirming Prepackaged Plan AMERICAN MEDIA: Court OKs Access to Cash Collateral Until Feb. 17 AMERICAN MEDIA: Wins Final Nod for Ordinary Course Professionals AMERICAN MEDIA: Wins Nod to Honor Prepetition Customer Obligations AMERIQUAL GROUP: Moody's Junks Corporate Family Rating From 'B3' APPALACHIAN OIL: Plan of Liquidation Wins Court Approval ARTECITY PARK: U.S. Trustee Unable to Form Creditors Committee ARTECITY PARK: Plan Outline Hearing Continued Until January 20 ARTZ RIB: Files for Chapter 11 Bankruptcy Protection ASIAN ART MUSEUM: Receives 30-Day Forbearance From JPMorgan ATLANTIC BROADCASTING: Financial Woes Prompt Bankruptcy Filing ATLANTIC BROADCASTING: Case Summary & 20 Largest Unsec Creditors AUTO CENTER: Case Summary & 3 Largest Unsecured Creditors BEAR CREEK: Court Dismisses Case for Lack of Means to Reorganize BEEHIVE CREDIT: Falls Into Receivership, Texas C.U. Takes Over BELL, CALIFORNIA: Needs Drastic Cuts in City Services, Audit Finds BERNARD L MADOFF: Greenwich to Sue Fairfield for Breach BIG CABIN: Case Summary & 2 Largest Unsecured Creditors BIOFUEL ENERGY: Seeks Confidential Treatment of Exhibit BIOLASE TECHNOLOGY: CFO Furry Does Not Own Any Securities BLANCA LLC: Bankruptcy Court Dismisses Debtor's Chapter 11 Case BLB WORLDWIDE: S&P Assigns 'B+' Corporate Credit Rating BLOCKBUSTER INC: Not Hopelessly Insolvent, M. Rudd Asserts BLOCKBUSTER INC: Proposes Deloitte as Valuation Advisor BLUEGREEN CORP: Two Directors Elected by Shareholders BLUEGREEN CORP: S&P Raises Corporate Credit Rating to 'B-' BPP TEXAS: Owners of 22 Hotels Seek Chapter 11 Protection BPP TEXAS: Case Summary & 20 Largest Unsecured Creditors BRIDGEWATER CONDOMINIUMS: Case Summary & 2 Largest Unsec Creditors CAESARS ENTERTAINMENT: Deregisters Non-Voting Shares for Plan CAESARS ENTERTAINMENT: Registers 4.577MM Shares for Incentive Plan CAPITAL HOME: Asks for Court Okay to Use Cash Collateral CASTLEROCK ENTERPRISES: Voluntary Chapter 11 Case Summary CELEBRITY RESORTS: Court Declares Son, Not Father, as Owner CENTRAL TEXAS TRAILS: Texas High Ct. Remands Suit Over 2003 Crash CFC MANAGEMENT: Inability to Refinance Loan Cues Bankruptcy Filing CLAIM JUMPER: Gift Card Holders to get Money Back CLIFFS AT INDIAN: Case Summary & Largest Unsecured Creditor CNO FINANCIAL: Moody's Upgrades Ratings on Senior Loan to B1' CNO FINANCIAL: S&P Raises Counterparty Credit Rating to 'B' COLOR ALL: Case Summary & 20 Largest Unsecured Creditors COLUMBIAN CHEMICALS: S&P Assigns 'BB-' Corporate Credit Rating CONAGRA FOODS: Fitch Says Outlook Cuts Cue Increased Concern CONNACHER OIL: Moody's Gives Stable Outlook, Keeps 'Caa1' Rating CONVATEC HEALTHCARE: Moody's Assigns B2 Corporate; PR Corrected CONVERGYS CORPORATION: Moody's Affirms 'Ba1' Corp. Family Rating CORT JONES: Case Summary & 20 Largest Unsecured Creditors CRYSTAL CATHEDRAL: Examiner Charged With Probing Compensation CYNERGY DATA: Judge Approve Chapter 11 Liquidation Plan DAVID DUNNE: Files Schedules of Assets and Liabilities DAVROC LLC: Case Summary & 19 Largest Unsecured Creditors DEE RANDALL: Case Summary & 5 Largest Unsecured Creditors DELUXE ICE: Hearing on Key Bank's Cash Use Continued Until Jan. 18 DELUXE ICE: Creditors Have Until January 7 to File Proofs of Claim DIABETES AMERICA: Voluntary Chapter 11 Case Summary DISH NETWORK: Ergen Five-Year Owns 12.5 Million Class B Shares DIVINE SQUARE: Asks for Court's Permission to Use Cash Collateral DK AGGREGATES: Committee Wins Nod for Heller Draper as Counsel DK AGGREGATES: Panel Can Retain Wheeler & Wheeler as Local Counsel DK AGGREGATES: JL Holloway Replaced by DK Aggregates on Committee DK AGGREGATES: Wants Plan Filing Period Extended Until March 9 DUBAI WORLD: Port Terminal Unit Has $1.5BB Deal with Citi DYNEGY INC: Seneca to Rally Shareholders Against Icahn Deal ELEPHANT TALK: Files Post-Effective Amendment to Form S-8 EMPIRE RESORTS: L. Capelli Reports 7.50% Equity Stake ENERGAS RESOURCES: Incurs $80,371 Net Loss in October 31 Quarter ERLINA AREVALO: Case Summary & 20 Largest Unsecured Creditors FIRST ACCEPTANCE: A.M. Best Affirms 'B' Financial Strength Rating FIRST DATA: Moody's Assigns 'Caa1' Ratings to $2 Bil. Senior Notes FIRST OCCUPATIONAL: Organizational Meeting on Dec. 29 FONTAINEBLEAU LV: Files Privilege Logs With District Court GARRISON ROAD: Grants Lift Stay to Secured Creditor GARY PHILLIPS: Asks for Court's Permission to Use Cash Collateral GEBO PROPERTIES: Case Summary & Largest Unsecured Creditor GENERAL MOTORS: Firms Quote Prices of Default Swaps on New Debt GENERAL MOTORS: GM Nova Scotia Has New GM Backing for Claims GENERAL MOTORS: New GM Completes Purchase of $2.1 Bil. Pref. Stock GENERAL MOTORS: New GM to Seal Letter of Intent With Leson GENERICS INTERNATIONAL: Moody's Withdraws 'B3' Corp. Family Rating GEO GROUP: S&P Puts 'BB-' Corporate Rating on CreditWatch Negative GLOBAL DIVERSIFIED: Incurs $1.1 Mil. Net Loss in Oct. 31 Quarter GREAT ATLANTIC & PACIFIC: Wins Interim OK to Pay Lottery Proceeds GREAT ATLANTIC & PACIFIC: Wins Interim OK to Pay Sales & Use Taxes GREAT ATLANTIC & PACIFIC: Wins Interim OK to Protect NOLs GSC GROUP: Objects to Lenders' Request for a Chapter 11 Trustee HARRIS COUNTY: Moody's Affirms 'Ba3' Senior Lien Rating HARRISBURG, PA: Budget A Point Of Contention Days Before Vote HAWKS PRAIRIE: Has Until March 15 to Sell 337-Acre Property HAYES LEMMERZ: S&P Raises Corporate Credit Rating to 'B' HILL COUNTRY: Sues Bank to Block Foreclosure of Shopping Center HOMES TO GO: Case Summary & 17 Largest Unsecured Creditors IHEALTH TECHNOLOGIES: Moody's Raises Corp. Family Rating to 'B1' IK/S-BAR, LLC: Case Summary & 17 Largest Unsecured Creditors INDIANTOWN COGENERATION: Fitch Affirms 'BB' Rating on Bonds INNKEEPERS USA: Court Issues Revised Decision on Lehman PSA INOVA TECHNOLOGY: Incurs $380,000 Net Loss in October 31 Quarter INTEGRATED FREIGHT: Seaside 88 Discloses 9.99% Equity Stake INTEGRATED HEALTHCARE: K. Chaudhuri Discloses 77.55% Equity Stake INTERNATIONAL COAL: Sets Pricing of 40-Mil. Shares Offering INTERNATIONAL COAL: Files Form S-3ASR; May Sell Common Stock INTERNATIONAL RECTIFIER: S&P Raises Corp. Credit Rating to 'BB-' INTERTAPE POLYMER: Court Cuts Jury Award to $3 Million JAMES SHANNON: District Court Rejects Interlocutory Appeal JEMSEK CLINIC: Insurer's Misconduct Warrants Claim Dismissal JERRY BARNETT: Court Orders Appointment of Chapter 11 Examiner JERRY BARNETT: U.S. Trustee Unable to Form Creditors Committee JERRY BARNETT: Wins Nod for Brian L. Budsberg PLLC as Counsel JOURDAN RIVER: Regions Bank Guaranty Suit Sent to Arbitration JOSEPH KWIATKOWSKI: Case Summary & 13 Largest Unsecured Creditors JULIE GREEN: Case Summary & 15 Largest Unsecured Creditors KENMORE REALTY: Case Summary & 20 Largest Unsecured Creditors KENWILAGO GROUP: Case Summary & 4 Largest Unsecured Creditors KIEBLER RECREATION: Plan Outline Hearing Set for January 4 KIMPEL'S JEWELRY: Court Won't Hear Claims v. Non-Debtor Defendants KSJK FAMILY: Voluntary Chapter 11 Case Summary LEON SUGAR: Owes $1.46 Million to Top 20 Creditors LEHMAN BROTHERS: Court Issues Revised Decision on Lehman PSA LEHMAN BROTHERS: LBI Gets May 9 Extension to Reject Leases LEHMAN BROTHERS: Wants Lift Stay to Allow Northgate Payments LODGENET ENTERTAINMENT: D. Shaw Discloses 5.5% Equity Stake LPATH INC: Grants Pfizer Exclusive Option for iSONEP Development LTAP US: Files for Chapter 11 Protection in Delaware LTAP US: Case Summary & 7 Largest Unsecured Creditors MAGNA ENTERTAINMENT: MID Files Business Acquisition Report MALLORY-KOTZEN TIRE: Case Summary & 20 Largest Unsecured Creditors MCCLATCHY CO: Lenders Cut Early Restrictions on Bond Retirement MERUELO MADDUX: Equity Holders Want Charleston Plan to Go Forward MESA AIR: Citicorp Assigns Claims to Refine Inc. MGM RESORTS: Board Approves Amended Company Bylaws MICHAEL PEEL: Voluntary Chapter 11 Case Summary MICHAEL SCOTT CHANDLER: Estrange Wife Can Pursue Divorce Suit MIDWEST PROPERTIES: Court Dismisses Chapter 11 Case MIDWEST OIL: Court Dismisses Chapter 11 Case MIG INC: To Settle Tax Fight, Gets Two Executives Out Of Jail MOLECULAR INSIGHT: Looks to Secure $45 Million Equity Infusion NATIONAL COAL: Delisted From NASDAQ Stock Market NCI BUILDING: S&P Downgrades Corporate Credit Rating to 'B' NET TALK.COM: Sept. 30 Balance Sheet Upside-Down by $7.09 Million NH SIMPSON: Case Summary & 8 Largest Unsecured Creditors NOVASTAR FINANCIAL: Neuberger Berman Group Has 10.2% Equity Stake NOVELOS THERAPEUTICS: Xmark Opportunity Has 7.6% Equity Stake NXT NUTRITIONALS: Withdraws S-1 Registration Statement OAKS CONSTRUCTION: Debts of Project Prompts Bankruptcy Filing OMNIA ALEXIS: Voluntary Chapter 11 Case Summary OPTI CANADA: FMR LLC Discloses 2.5% Equity Stake ORCHARD BRANDS: May File Prepack Bankruptcy as Soon as Dec. 30 PARTNERS MUTUAL: AM Best Cuts Financial Strength Rating to 'B' PENINSULA GAMING: Moody's Reviews 'B1' Corporate Family Rating PETROLEUM & FRANCHISE: Plan Confirmation Hearing Set for Jan. 12 PLATINUM ENERGY: Eight Nominees Elected to Board of Directors PLAYLOGIC ENTERTAINMENT: Board Accepts Resignation of CEO PRESERVE AT LINDSEY: Case Summary & 7 Largest Unsecured Creditors PRIMUS GUARANTY: Moody's Downgrades Ratings on Senior Debt to 'B3' RCG APARTMENTS: Case Summary & 19 Largest Unsecured Creditors REFCO INC: Togut Segal Bills $136,180 for Feb.-Oct. Work ROCK & REPUBLIC: Seeks to Sell Intellectual Property to VF Corp. ROCK & REPUBLIC: Signs Asset Purchase Agreement with VF Corp SANTA FE: Voluntary Chapter 11 Case Summary SCOTT MEYROWITZ: Court Won't Hear Claims v. Non-Debtor Defendants SHELBRAN INVESTMENTS: Case Summary & 9 Largest Unsecured Creditors SIMON WORLDWIDE: B. Nugent Does Not Own Any Securities SIMON WORLDWIDE: Overseas Toys Has 82.5% Equity Stake SMART-TEK SOLUTIONS: B. Bonar Does Not Own Any Securities STEPHEN PEEL: Voluntary Chapter 11 Case Summary SYRACUSE RESORT: Filed for Bankruptcy to Block Seizure T&M AVIATION: Has Green Light to Sell Chopper $50,000 Cash TEGRANT CORP: S&P Puts 'CCC' Rating on CreditWatch Positive TIGRENT INC: No Longer Target of Investigation by DOJ TOUSA INC: Citicorp Wants Committee's Plan Outline Disapproved TOWNSENDS INC: Organizational Meeting to Form Panel on Dec. 29 TWAIN CONDOMINIUMS: Files for Bankruptcy to Avoid Foreclosure UNI-PIXEL INC: Morgan Stanley Discloses 1.2% Equity Stake U.S. ACQUISITIONS: Case Summary & 7 Largest Unsecured Creditors USEC INC: FMR LLC Discloses 5.419% Equity Stake VISTA RIDGE: 10th Cir. BAP Grants Homeowners an Admin. Claim VITAMIN SHOPPE: Moody's Raises Corporate Family Rating to 'B1' WALNUT GARDENS: Case Summary & 13 Largest Unsecured Creditors WASHINGTON MUTUAL: Shareholders Can't Make New Plan Arguments WEST VIRGINIA NATIONAL: AM Best Cuts Issuer Credit Rating to BB WISE METALS: S&P Withdraws 'CCC' Corporate Credit Rating WORKFLOW MANAGEMENT: Obtains Final Approval to Use Cash Collateral XODTEC LED: Barron Partners Discloses 4.1% Equity Stake Z TRIM HOLDINGS: E. Smith Discloses 70.2% Equity Stake * Municipal Investors Grow Pickier About Insurers' Fin'l Health * Foreclosure Filings 2010 Show No Shortage of Foreclosed Homes * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ********* ALFRED LI: Case Summary & 15 Largest Unsecured Creditors -------------------------------------------------------- Joint Debtors: Alfred Li Mary Li 434 East Saxon Avenue San Gabriel, CA 91776 Bankruptcy Case No.: 10-64024 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Alan M. Ahart Debtors' Counsel: Michael J. Jaurigue, Esq. JAURIGUE LAW GROUP 411 N. Central Avenue, Suite 310 Glendale, CA 91203 Tel: (818) 432-3220 E-mail: michael@jauriguelaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Joint Debtors' 15 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-64024.pdf ALLIANZ GLOBAL: Court Grants Formal Recognition of UK Proceedings ----------------------------------------------------------------- The United States Bankruptcy Court for the Southern District of New York has granted the petition of David McGuigan, in his capacity as the duly appointed foreign representative of Allianz Global Corporate & Specialty (France), Allianz IARD, Delvag Luftfahrtversicherungs-AG and N〉nberger Allgemeine Versicherungs- AG (collectively, the "Scheme Companies"), for recognition under Chapter 15 of the Scheme Companies' jointly administered adjustment of debt proceedings (the "English Proceedings") in the High High Court of Justice of England and Wales, as "foreign nonmain proceedings" pursuant to 11 U.S.C. Section 1502. The Court further ordered that relief equivalent to that afforded to a debtor in a foreign main proceeding pursuant to 11 U.S.C. Section 1520 is granted as additional relief pursuant to 11 U.S.C. Sections 1521(a) and (b) and is effective as to the Scheme Companies. Under Section 1521 of the Bankruptcy Code, a court is granted discretion to grant other appropriate relief at the request of the foreign representative, including in foreign nonmain proceedings which, unlike foreign main proceedings, do not invoke Section 1520's automatic stay. A complete text of the Court's order granting formal recognition of David McGuigan as a "foreign representative" of the Scheme Companies and the English proceedings as "foreign nonmain proceedings" is available at no charge at: http://bankrupt.com/misc/Allianz_formalrecognitionorder.pdf As reported in the Troubled Company Reporter on October 4, 2010, the aim of the schemes of arrangement between the Scheme Companies is to finalize the run-off of the Scheme Companies' involvement in the business underwritten for them by Camomile Underwriting Agencies Limited. The Scheme does not include any non-CUAL business nor, for the avoidance of doubt, any business underwritten for Sovereign Marine & General Insurance Company Limited whether for the business they underwrote through CUAL or otherwise. The Scheme Manager can be contacted at: David McGuigan CUAL Scheme Manager PO Box 683, Redhill, RH1 9BY United Kingdom Fax: +44 (0)207 626 7937 E-mail: dmcguigan@limbo.eu The Chapter 15 petitioner's counsel can be contacted at: Lee S. Attanasio, Esq. Alex R. Rovira, Esq. Debra W. Minoff, Esq. SIDLEY AUSTIN LLP 787 Seventh Avenue New York, NY 10019 Tel: (212) 839-5300 David McGuigan, the foreign representative for Allianz Global Corporate & Specialty (France), Allianz IARD, Delvag Luftfahrversicherungs-AG and Nurnberger Allgemeine Versicherungs- AG, filed Chapter 15 petitions (Bankr. S.D.N.Y. Case Nos. 10-14990 through 10-14993) on Sept. 22, 2010. ALLIED DEFENSE: Gabelli Discloses 3.39% Equity Stake ---------------------------------------------------- In a Schedule 13D filing with the Securities and Exchange Commission on December 13, 2010, Gabelli Securities Inc., disclosed it beneficially owns 279,048 shares of common stock of The Allied Defense Group, Inc., representing 3.39% of the shares outstanding. Gabelli Funds beneficially owns 75,000 shares of common stock, representing 0.91% equity stake. Alliance Defense had 8,235,193 shares of the class outstanding as reported in the its Form 10-Q for the quarterly period ended September 30, 2010. The previous Schedule 13D identified GAMCO Investors, Inc., ("GBL") as beneficially owning 66,199 shares, representing 0.80% of the shares outstanding. On Dec. 9, 2010, GBL amended an investment management contract with an unaffiliated investment advisor which requires GBL to provide 90 days written notice to terminate the advisory contract. Mario Gabelli is deemed to have beneficial ownership of the Securities owned beneficially by each of the reporting Gaelli entities. GSI is deemed to have beneficial ownership of the Securities owned beneficially by Gabelli & Company. GBL and GGCP, Inc. are deemed to have beneficial ownership of the Securities owned beneficially by each of the foregoing persons other than Mario Gabelli and the Foundation. About The Allied Defense Group Vienna, Va.-based The Allied Defense Group, Inc. (OTCQB: ADGI) -- http://www.allieddefensegroup.com/-- is a multinational defense business focused on the manufacture and sale of ammunition and ammunition related products for use by the U.S. and foreign governments. Allied's business is conducted by its two wholly owned subsidiaries: Mecar S.A. ("Mecar") and Mecar USA, Inc. ("Mecar USA"). Mecar is located in Nivelles, Belgium and Mecar USA is located in Marshall, Texas. Corporate is located in Vienna, Virginia. The Company's balance sheet at Sept. 30, 2010, showed $50.99 million in total assets, $5.33 million in total liabilities, and stockholders' equity of $45.65 million. The Company received a subpoena from the U.S. Department of Justice on January 19, 2010, requesting that the Company produce documents relating to its dealings with foreign governments. The Company said it is unlikely that any distributions to stockholders will be made until the matters relating to the DOJ subpoena have been resolved. The period of time required to resolve these matters is expected to take in excess of one year. * * * As reported in the Troubled Company Reporter on April 16, 2010, BDO Seidman LLP, in Bethesda, Md., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations. Also, the Company has been unable to obtain long-term and short-term financing necessary to support its operations. ALLIED DEFENSE: Water Island Reports 8.369% Equity Stake -------------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, Water Island Capital, LLC disclosed that it beneficially owns 689,203 shares of Allied Defense Group Inc. common stock representing 8.369% of the shares outstanding. The number of shares of the Company's Common Stock outstanding as of November 12, 2010, was 8,235,193. About The Allied Defense Group Vienna, Va.-based The Allied Defense Group, Inc. (OTCQB: ADGI) -- http://www.allieddefensegroup.com/-- is a multinational defense business focused on the manufacture and sale of ammunition and ammunition related products for use by the U.S. and foreign governments. Allied's business is conducted by its two wholly owned subsidiaries: Mecar S.A. ("Mecar") and Mecar USA, Inc. ("Mecar USA"). Mecar is located in Nivelles, Belgium and Mecar USA is located in Marshall, Texas. Corporate is located in Vienna, Virginia. The Company's balance sheet at Sept. 30, 2010, showed $50.99 million in total assets, $5.33 million in total liabilities, and stockholders' equity of $45.65 million. The Company received a subpoena from the U.S. Department of Justice on January 19, 2010, requesting that the Company produce documents relating to its dealings with foreign governments. The Company said it is unlikely that any distributions to stockholders will be made until the matters relating to the DOJ subpoena have been resolved. The period of time required to resolve these matters is expected to take in excess of one year. * * * As reported in the Troubled Company Reporter on April 16, 2010, BDO Seidman LLP, in Bethesda, Md., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations. Also, the Company has been unable to obtain long-term and short-term financing necessary to support its operations. ALION SCIENCE: Incurs $3.34-Mil. Net Loss in Sept. 30 Quarter ------------------------------------------------------------- Alion Science and Technology Corporation hosted a conference call on December 21, 2010 at 10:00 a.m. ET / 7:00 a.m. PT to discuss financial results for Alion's fiscal year 2010. This call is being provided for and is limited to investors in Alion's debt. Alion Science said it was disclosing certain non-public information: -- Consolidated EBITDA for the 12-month period ended Sept. 30, 2010, was approximately $63.9 million, and for the three month period ended September 30, 2010, was $22.0 million; and -- The Company incurred a net loss of $3.34 million for the three months ended Sept. 30, 2010, and $15.23 million for 12 months ended Sept. 30, 2010. A full-text copy of the regulatory filing is available for free at http://ResearchArchives.com/t/s?7155 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. The Company's balance sheet at June 30, 2010, showed $643.59 million in total assets, $156.97 million in total current liabilities, $272.09 million in senior secured notes, $245.90 million in senior unsecured notes, $5.08 million in accrued compensation, $752,000 in accrued postretirement benefits obligations, $7.87 million in non-current portion of lease obligations, $35.61 million in deferred income taxes, $151.37 million in redeemable common stock, $20.78 million in common stock warrants, a $238,000 accumulated other comprehensive loss and an accumulated deficit of $252.62 million. * * * Alion carries 'Caa3' corporate family and probability of default ratings from Moody's. Alion carries a 'B-' corporate credit rating from Standard & Poor's. Moody's said in March 2010, "The Caa1 corporate family rating would balance the continued high leverage against a promising business backlog that could sustain the good 2009 revenue growth rate, though credit challenges would remain pronounced." AMERICANWEST BANCORP: All Directors Resign Following Bank Sale -------------------------------------------------------------- As reported in the Troubled Company Reporter on December 21, 2010, AmericanWest Bancorporation completed the sale of all outstanding shares of its wholly-owned subsidiary, AmericanWest Bank, to a wholly owned subsidiary of SKBHC Holdings LLC, in a transaction that was previously approved by the U.S. Bankruptcy Court for the Eastern District of Washington. SKBHC has informed the Company that, as previously agreed, it also contributed an additional $185 million of new capital to the Bank. The Company received total cash consideration of $6.5 million for the sale, including $850,000 of debtor-in-possession financing previously provided by SKBHC. The primary remaining activity of the Company will be the winding up of its affairs and the distribution of its assets. On December 20, 2010, immediately upon the closing of the sale of the Bank, all of its directors resigned from the board of directors of the Bank: J. Frank Armijo, Kay C. Carnes, Craig D. Eerkes, Patrick J. Rusnak, Donald H. Swartz II and P. Mike Taylor. About AmericanWest Bancorporation Headquartered in Spokane, Washington, AmericanWest Bancorporation (OTC BB: AWBC) -- http://www.awbank.net/-- is a bank holding company whose principal subsidiary is AmericanWest Bank, which includes Far West Bank in Utah operating as an integrated division of AmericanWest Bank. AmericanWest Bank is a community bank with 58 financial centers located in Washington, Northern Idaho and Utah. AmericanWest Bancorporation filed for Chapter 11 protection on Oct. 28, 2010 (Bankr. E.D. Wash. Case No. 10-06097). The banking subsidiary was not including in the Chapter 11 filing. Christopher M. Alston, Esq., and Dillon E. Jackson, Esq., at Foster Pepper Shefelman PLLC, in Seattle, Washington, serve as bankruptcy counsel. G. Larry Engel, Esq., at Morrison & Foerster LLP, also serve as counsel. The Debtor estimated assets of $1 million to $10 million and debts of $10 million to $50 million in its Chapter 11 petition. AmericanWest Bancorporation's estimates exclude its banking unit's assets and debts. In its latest Form 10-Q filed with the Securities and Exchange Commission, AmericanWest Bancorporation reported consolidated assets -- including its bank unit's -- of $1.536 billion and consolidated debts of $1.538 billion as of Sept. 30, 2010. AMR CORP: Form 10-Q Exhibit Treated as Confidential --------------------------------------------------- AMR Corporation submitted an application under Rule 24b-2 requesting confidential treatment for information it excluded from the Exhibits to a Form 10-Q filed on July 21, 2010, as amended on December 9, 2010. Based on representations by AMR Corporation that this information qualifies as confidential commercial or financial information under the Freedom of Information Act, 5 U.S.C. 552(b)(4), the Division of Corporation Finance has determined not to publicly disclose it. Accordingly, excluded information from the following exhibits will not be released to the public for the time periods specified: Exhibit 10.1 through January 1, 2019 Exhibit 10.2 through January 1, 2019 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. The Company's balance sheet at Sept. 30, 2010, showed $25.36 billion in total assets, $8.94 billion in total liabilities, $9.01 in billion of long-term debts, $503.0 million in obligations under capital lease, $7.41 billion pension and post-retirement benefits, $3.14 billion in other liabilities, and a stockholder's deficit of $3.64 billion. * * * 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. Standard & Poor's Ratings Services said it has revised its outlook on AMR Corp. and its major operating subsidiary, American Airlines Inc., to stable from negative, based on AMR's improved operating performance, which has bolstered credit quality. S&P also affirmed its 'B-' corporate credit rating and most issue ratings on the two companies and lowered selected ratings on American's enhanced equipment trust certificates. AMERICAN INT'L: Fairholme Capital Discloses 31.6% Equity Stake -------------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on December 14, 2010, Fairholme Capital Management, LLC disclosed that it beneficially owns 44,294,324 shares of American International Group, Inc., common stock representing 31.6% of the shares outstanding. Bruce R. Berkowitz also owns 44,294,324 while Fairholme Funds, Inc. owns 40,432,939 or 28.9%. As of October 29, 2010, there were 135,143,176 shares outstanding of the Company's common stock. About AIG American International Group, Inc. -- http://www.aig.com/-- 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 are leading providers of 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. AIG almost collapsed under the weight of bad bets it made insuring mortgage- backed securities. The Company, however, was bailed out by the Federal Reserve, but even after an initial infusion of $85 billion, losses continued to grow. The later rescue packages brought the total to $182 billion, making it the biggest federal bailout in U.S. history. AIG has been working to protect and enhance the value of its key businesses, execute an orderly asset disposition plan, and position itself for the future. 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: Board to Decide on Preferred Bidder for Nan Shan ---------------------------------------------------------------- Alison Tudor and Joann S. Lublin, writing for The Wall Street Journal, report that directors of American International Group Inc. are expected to confer Thursday to try to agree on a preferred bidder for its Taiwan business, Nan Shan Life Insurance Co., according to people familiar with the situation. That choice likely will be announced next week, the people said. One of the sources told the Journal that after a decision on a bidder is made, AIG would seek approval from the Financial Supervisory Commission, Taiwan's financial watchdog, by telling regulators: "This is a deal. Please approve." The Journal relates people familiar with the matter said a number of firms are in the running as bidders, including Fubon Financial Holding Co., Cathay Financial Holding Co., Chinatrust Financial Holding Co. and Ruentex Group. Ruentex has offered the most, sources said, but it doesn't mean Ruentex will prevail. "It will be a balancing act between the best proceeds and the best assurance of closing," since the preferred bidder must get a go- ahead from the FSC, one of the people said, according ot the Journal. The Journal also relates AIG Chief Executive Robert Benmosche visited the FSC's offices on Dec. 15. According to the report, the FSC has said its five conditions for a buyer are: a promise to look after policyholders and staff, sound financing for the deal, insurance experience, long-term commitment and ability to meet future funding needs. The Journal relates the FSC didn't reply to a request for comment Wednesday. Cathay, Chinatrust and Ruentex have confirmed they are bidding for Nan Shan. Fubon hasn't commented. A spokesman for AIG declined to comment. Earlier this year, AIG attempted to sell Nan Shan for $2.15 billion to a consortium of two Hong Kong-based buyers, private-equity firm Primus Financial Holdings Ltd. and China Strategic Holdings Ltd. However, the FSC rejected the sale in August over concerns about the acquirers' financial strength and commitment to Nan Shan. AMERICAN INT'L: Treasury Said to Sell Shares in 2 Offerings ----------------------------------------------------------- Reuters' Paritosh Bansal in New York and David Lawder in Washington report that the Treasury Department plans to sell a large piece of its stake in American International Group in two stock offerings next year and sell any remaining stock in AIG in 2012, officials briefed on the situation said. The U.S. government will own 92.1% of AIG after a recapitalization plan closes by the end of first quarter, and perhaps as soon as December 31. Sources told Reuters the Treasury plans to sell about one-fifth of AIG in the first offering, which is expected in the first half of 2011 and perhaps as soon as March. The sources said AIG and the Treasury would sell stock in that offering, which could exceed $10 billion, sources have said. That would place it among the largest secondary share offerings in history, Reuters notes. Reuters relates the stock sale will help the government make a profit on the $182.3 billion it loaned AIG if the offering is roughly $30 per share or higher. The Treasury's stake is worth about $90 billion at the current share price. It spent $49.1 billion for that stake. The Troubled Company Reporter reported AIG's entry into a Master Transaction Agreement regarding the Recapitalization Plan on December 9, 2010. Among other things, AIG will repay to the FRBNY in cash all amounts owing under the FRBNY Credit Facility, and the FRBNY Credit Facility will be terminated. As of September 30, 2010, the total repayment amount under the FRBNY Credit Facility was roughly $20 billion. The funds for repayment are to come from the net cash proceeds from the sale in the initial public offering of 67% of AIA Group Limited ordinary shares and the sale of American Life Insurance Company, which closed on October 29, 2010 and November 1, 2010, respectively. The Plan will also involve the sale of AIG securities held by the Treasury. The Wall Street Journal's Serena Ng and Erik Holm reported that people familiar with the matter said the Treasury is aiming to sell at least $15 billion of its shares in AIG in the first of a series of stock offerings starting in the first quarter of 2011. The Journal noted that executing the share sales, which are expected to total over $60 billion over two years, will involve a careful balancing act that aims to disentangle the government from the company without destabilizing it. While Treasury wants to exit its ownership as quickly as possible, it doesn't want to get in the way if AIG needs to buttress its capital position or that of its insurance subsidiaries by selling shares. The Journal also noted the government will essentially be able to dictate the terms and frequency of AIG share sales until U.S. ownership drops below 33%. AIG can sell up to $3 billion in new shares before mid-August next year, money that will be used to replace a liquidity facility from Treasury. AIG will have to seek Treasury's approval if it wants to raise more money. According to the Journal, people familiar with the matter said AIG is likely to sell $2 billion to $3 billion in new shares alongside Treasury's first offering of its AIG shares next year. The actual size of the total offering will depend on investor demand for AIG's stock, which will be gauged in the coming months after the company kicks off presentations to prepare for the sales, the people said. A full-text copy of AIG's Form 8-K filed with the Securities and Exchange Commission outlining the Master Transaction Agreement is available at http://is.gd/iqdu6 About AIG American International Group, Inc. -- http://www.aig.com/-- 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 are leading providers of 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. AIG almost collapsed under the weight of bad bets it made insuring mortgage- backed securities. The Company, however, was bailed out by the Federal Reserve, but even after an initial infusion of $85 billion, losses continued to grow. The later rescue packages brought the total to $182 billion, making it the biggest federal bailout in U.S. history. AIG has been working to protect and enhance the value of its key businesses, execute an orderly asset disposition plan, and position itself for the future. 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 MEDIA: Court Enters Order Confirming Prepackaged Plan -------------------------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York confirmed American Media Inc. and its debtor affiliates' Amended Joint Prepackaged Plan of Reorganization on December 20, 2010, clearing the way for the Debtors to emerge from Chapter 11 reorganization by the end of 2010. The confirmed Plan of Reorganization will strengthen the Debtors' capital structure, significantly de-lever its balance sheet and improve its already strong cash flow and cash on hand, the Company said in a press release. Judge Glenn held that the Plan complies with all applicable provisions of Section 1129 of the Bankruptcy Code. Specifically, Judge Glenn ruled that: (1) The Plan complies with all applicable provisions of Section 1129(a)(1), including Sections 1122 and 1123 in that: * Each Class of Claims and Interests contains only Claims or Interests that are substantially similar to the other Claims or Interests within that Class, and thus satisfies the requirements of Sections 1122(a), 1122(b) and 1123(a) (1). * Section 3 of the Plan specifies that Classes 1, 3, 4, and 8 are unimpaired. Additionally, Section 2 of the Plan specifies that Administrative Claims and Priority Tax Claims are unimpaired, although these Claims are not classified under the Plan. Accordingly, the requirements of Section 1123(a)(2) have been satisfied. * The Plan specifies in Section 3 that Classes 2, 5, 6, 7, 9 and 10 are impaired and sets forth the treatment of the impaired Classes in Section 4 of the Plan, thereby satisfying Section 1123(a)(3). * Section 4 of the Plan provides for the same treatment for each Claim or Interest in each respective Class unless the Holder of a particular Claim or Interest has agreed to a less favorable treatment of that Claim or Interest. Accordingly, the Plan satisfies Section 1123(a)(4). * Section 5 of the Plan and various other provisions of the Plan specifically provide in detail adequate and proper means for implementation of the Plan including, but not limited to: (i) the distribution of New Second Lien Financing; (ii) the offer by the Backstop Parties to purchase New Second Lien Notes; (iii) the issuance of New Common Stock; (iv) the cancellation of existing securities and agreements; (v) the entry into a Stockholders Agreement by the Reorganized Debtors and the parties that receive New Common Stock under the Plan; (vi) the cancellation of liens; and (vii) the substantive consolidation of the Debtors' estates. In addition, Section 5 of the Plan provides for the establishment of an Equity Incentive Plan, a Director Severance Plan and an Emergence Incentive Plan. Moreover, the Reorganized Debtors will have, immediately upon the Effective Date, sufficient Cash to make all payments required to be made on the Effective Date pursuant to the terms of the Plan. Accordingly, the requirements of Section 1123(a)(5) have been satisfied. * The Plan satisfies Section 1123(a)(6). Section 5.2 of the Plan provides that the organizational documents of each Reorganized Debtor will be amended as necessary to satisfy the provisions of the Plan and the Bankruptcy Code, including section 1123(a)(6). The Restated Certificates of Incorporation provide that the Reorganized Debtors will not issue any non-voting equity securities to the extent required by Section 1123(a)(6). * The identity and affiliations of the members of the New Boards as of the Effective Date are listed in the Plan Supplement as filed on December 15, 2010. The Restated Certificates of Incorporation of Reorganized AMI and each of the Reorganized Debtors describe the manner of the selection of additional members of the New Boards following the Effective Date. Section 5 of the Plan describes the manner of selection of officers and directors for the Reorganized Debtors. The selection of the initial directors and officers of the Reorganized Debtors was, is and will be consistent with the interests of Holders of Claims and Interests and public policy. Accordingly, the requirements of Section 1123(a)(7) have been satisfied. (2) The Debtors have complied with the applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Scheduling Order, and other orders of the Court, thereby satisfying Section 1129(a)(2). In particular, the Debtors are properly debtors under Section 109. The Debtors are proper proponents of the Plan pursuant to Section 1121(a). (3) The Debtors have proposed the Plan in good faith, for proper purposes and not by any means forbidden by law, thereby satisfying Section 1129(a)(3). The Chapter 11 cases were filed, and the Plan and all modifications were proposed, with the legitimate and honest purpose of reorganizing and maximizing the value of the Debtors and the recovery to claimholders. (4) Pursuant to Section 2.2, professionals are required to file their final fee applications with the Court no later than 45 days after the Effective Date. These applications remain subject to Court approval under the standards established by the Bankruptcy Code, including the requirements of Sections 327, 328, 330, 331, 503(b) and 1103, as applicable. Section 11(h) of the Plan provides that the Court will retain jurisdiction after the Effective Date to hear and determine all applications for allowance of compensation or reimbursement of expenses authorized pursuant to the Bankruptcy Code or the Plan, including requests by professionals. Accordingly, the Plan fully complies with the requirements of Section 1129(a)(4). (5) The Plan complies with the requirements of Section 1129(a)(5) because, in the Disclosure Statement, the Plan and the Plan Supplement, the Debtors have disclosed: (a) the identity and affiliations of each proposed director, each proposed officer and the manner in which additional officers and directors of the Reorganized Debtors will be chosen following confirmation; and (b) the identity and nature of any compensation for any insider who will be employed or retained by the Reorganized Debtors. The method of appointment of directors and officers of the Reorganized Debtors was, is and will be consistent with the interests of Holders of Claims and Interests and public policy. The compensation for the proposed officers of the Reorganized Debtors is disclosed on pages 107-109 of the Offering Memorandum for the $385,000,000 11-1/2% First Lien Senior Secured Notes Due 2017. (6) The Plan does not contain any rate changes subject to the jurisdiction of any governmental regulatory commission and therefore will not require governmental regulatory approval. Therefore, Section 1129(a)(6) is inapplicable to the Chapter 11 cases. (7) The liquidation analysis, the declaration submitted by Christopher Polimeni, executive vice president for finance and planning, chief financial officer and treasurer of American Media, Inc., Zul Jamal, senior vice president at Moelis & Company LLC, and other evidence proffered or adduced at the Confirmation Hearing (i) are reasonable, persuasive and credible, (ii) are based on reasonable and sound assumptions, (iii) have not been controverted by other evidence, (iv) provide a reasonable estimate of the liquidation values of the Debtors in the event the Debtors were liquidated under Chapter 7 of the Bankruptcy Code, and (v) establish that each Holder of a Claim or Interest in an impaired Class that has not accepted the Plan will receive or retain under the Plan, on account of that Claim or Interest, property of a value, as of the Effective Date, that is not less than the amount that Holder would receive if the Debtors were liquidated under Chapter 7 on that date. Therefore, the Plan satisfies Section 1129(a)(7). (8) Classes 1, 3, 4 and 8 are unimpaired by the Plan and therefore, under Section 1126(f), those Classes are conclusively presumed to have accepted the Plan. Class 9, Intercompany Claims, is impaired but deemed to have accepted the Plan because the Debtors, at their discretion, may adjust, continue or discharge Intercompany Claims pursuant to the Plan. Classes 2, 5, 6 and 7 were entitled to vote on the Plan and Classes 2, 5 and 6 voted to accept the Plan. Accordingly, Section 1129(a)(8) has been satisfied with respect to Classes 1-6, 8 and 9. Class 7 rejected the Plan and Class 10 is deemed to reject the Plan pursuant to Section 1126(g), but, as found in section (xiv), the Plan is confirmable under Section 1129(b) notwithstanding the rejections by those Classes. Therefore, Section 1129(a)(8) has not been satisfied with respect to these Classes. (9) The treatment of Administrative Claims and Priority Non-Tax Claims under the Plan satisfies the requirements of Sections 1129(a)(9)(A) and (B), and the treatment of Priority Tax Claims under the Plan satisfies the requirements of Section 1129(a)(9)(C). (10) As set forth in the Voting Certification, at least one impaired Class of Claims voted to accept the Plan. Specifically, Holders of Claims in Classes 2, 5 and 6 voted to accept the Plan. Thus, there is at least one Class of Claims that is impaired under the Plan that has accepted the Plan, determined without including any acceptance of the Plan by any insider. Accordingly, the requirements of Section 1129(a)(10) have been satisfied. (11) The Plan satisfies Section 1129(a)(11). The Plan does not provide for the liquidation of all or substantially all of the property of the Debtors. The financial projections in the Disclosure Statement, the accompanying declarations, and the evidence proffered or adduced at the Confirmation Hearing: (a) are reasonable, persuasive, credible and accurate as of the dates those analysis or evidence was prepared, presented or proffered; (b) utilize reasonable and appropriate methodologies and assumptions; (c) have not been controverted by other evidence; (d) establish that the Plan is feasible and Confirmation of the Plan is not likely to be followed by the liquidation, or the need for further financial reorganization, of the Reorganized Debtors or any successor to the Reorganized Debtors under the Plan except as provided in the Plan; and (e) establish that the Reorganized Debtors will have sufficient funds available to meet their obligations under the Plan. Accordingly, the requirements of Section 1129(a)(11) have been satisfied. (12) The Debtors have paid or will pay by the Effective Date fees payable under 28 U.S.C. Section 1930. On and after the Effective Date, the Reorganized Debtors will pay the applicable U.S. Trustee fees for each of the Reorganized Debtors when due in the ordinary course until the Court enters a final decree in the Reorganized Debtor's Chapter 11 case. Accordingly, the requirements of Section 1129(a)(12) have been satisfied. (13) Section 1129(a)(13) requires a plan to provide for "retiree benefits" at levels established pursuant to Section 1114 of the Bankruptcy Code. Section 8.5 of the Plan provides that all employee compensation and benefit plans entered into before or after the Petition Date and not since terminated will be deemed to be, and will be treated as if they were, executory contracts to be assumed pursuant to the Plan. The Debtors' obligations under those plans and programs will survive confirmation of the Plan. Accordingly, the requirements of Section 1129(a)(13) have been satisfied. (14) The Plan Debtors are not required by a judicial or administrative order, or by statute, to pay a domestic support obligation. Thus, Section 1129(a)(14) is inapplicable in the Debtors' Chapter 11 cases. (15) The Plan Debtors are not individuals, and thus, Section 1129(a)(15) in the Debtors' Chapter 11 cases. (16) The Plan Debtors are each moneyed, business, or commercial corporations, and thus, Section 1129(a)(16) is inapplicable in the Debtors' Chapter 11 cases. Judge Glenn's main concern during the December 21 combined hearing was that the Plan was not specific enough about fees to be paid to lawyers representing the committee of creditors with unsecured claims, according to Bloomberg News. "I don't write blank checks," Bloomberg quoted the judge as saying. "I will not confirm the plan unless it's agreed on the record by you and the committee's counsel that payment for fees and expenses is subject to review by the court." The Debtors' counsel, Ira Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, conferred with the committee's attorney and told the judge the language of the plan would be amended to allay his concern, Bloomberg related. "I have been CEO for over a decade, and this is the best capital structure I have ever had to work with," David J. Pecker, president, chairman and chief executive officer of AMI, said. "This will allow AMI to finally capitalize on all the digital opportunities available for our brands, continue to strengthen our print properties, expand our publishing services efforts and ultimately accomplish what my goal has always been -- to build a major media company that will be among the industry's elite." Amended Prepackaged Chap. 11 Plan The confirmed Plan was the version delivered by the Debtors to the Court on December 15. The revised Plan included technical amendments. Mr. Dizengoff related to the Court that since the filing of the Chapter 11 case, the Debtors have received comments on the Plan from the Office of the U.S. Trustee for the Southern District of New York, counsel to the Official Committee of Unsecured Creditors, counsel to the Administrative Agent, counsel to certain indenture trustees for the Debtors' prepetition note issuances and counterparties to certain prepetition litigation. To address these comments and concerns, the Debtors filed an Amended Joint Prepackaged Plan. Mr. Dizengoff believes that the changes constitute a non-material modification, and thus the Plan as amended does not require additional disclosure pursuant to Section 1127(a) of the Bankruptcy Code, or the resolicitation of votes under Section 1126 of the Bankruptcy Code. The Debtors, in Section 10.3 of the Amended Plan, clarified that the Plan will not discharge any claims that have been alleged or could be alleged in the litigation in the U.S. District Court for the Southern District of New York captioned Anderson News, LLC, et al,. v. American Media, Inc., et al., Case No. 09-Civ.-2227 (PAC) and the appeal of the August 2, 2010 order dismissing that action, currently pending in the U.S. Court of Appeals for the Second Circuit. Section 10.8 of the Amended Plan provides for releases of certain Claims against non-Debtors in consideration of services provides to the estates and investments made by the non-Debtor Released Parties. The non-Debtor Released Parties are: (i) any direct or indirect shareholders of the Debtors; (ii) the current and former directors, officers, employees, professional advisors, sub-advisors, managers, affiliated management companies and managing and executive directors of the Debtors; (iii) members of the committee; (iv) the Indenture Trustees; (v) the Term Facility Lenders, the Revolver Lenders, the Administrative Agent, the collateral agent and other agents under the 2009 Credit Agreement; (vi) the New First Lien Notes Holders, the indenture trustee, the escrow agent and the collateral agent under the New First Lien Indenture; (vii) the New Second Lien Notes Holders, the indenture trustee, the escrow agent and the collateral agent under the New Second Lien Indenture; (viii) the New Revolver Facility Lenders and the New Revolver Facility administrative agent; (ix) the Backstop Parties; (x) the Holders of the New PIK Notes and the indenture trustee under the New PIK Notes, if any; (xi) the Holders of New Common Stock; and (xii) the Holders of the New Preferred Stock, if any; and (xiii) each of the respective directors, officers, partners, members, representatives, employees and professional advisors of those Persons in clauses (i) through (xii). To the extent permitted by applicable law, the releases are given by the Debtors and all Holders of Claims and Interests against the Debtors. The released Claims are any and all Claims or causes of action, including without limitation those in connection with, related to, or arising out of the Chapter 11 cases. Clean and redlined copies of the December 15 version of the Plan are available for free at: http://bankrupt.com/misc/AMI_AmPlan1215.pdf http://bankrupt.com/misc/AMI_AmPlan1215red.pdf The Debtors also delivered to the Court on December 15 a supplement documents to their Amended Plan, including: -- New First Lien Indenture -- New Second Lien Indenture -- Purchase Agreement for New First Lien Notes -- Registration Rights Agreement for New First Lien Notes -- Registration Rights Agreement for New Second Lien Notes -- Escrow Agreement for New First Lien Notes -- Intercreditor Agreement Among Reorganized Debtors, Collateral Agent for the New Revolver Facility Lenders, Trustee and Collateral Agent for New First Lien Note Holders, and Trustee and Collateral Agent for New Second Lien Note Holders -- Intercreditor Agreement Among Reorganized Debtors, Collateral Agent for New Revolver Facility Lenders, and Trustee and Collateral Agent for New First Lien Note Holders -- Stockholders' Agreement -- Restated Bylaws -- Restated Certificates of Incorporation -- Equity Incentive Plan -- Director Severance Plan -- Emergence Incentive Plan -- Identity of members of the New Boards and the initial officers of the Reorganized Debtors -- New Revolver Credit Facility Credit Agreement Full-text copies of the Plan Supplement Documents are available for free at http://bankrupt.com/misc/AMI_PlanSupp1215.pdf Mr. Polimeni, in his declaration, stated that he believes the Disclosure Statement contains adequate information within the meaning of Section 1125(a) of the Bankruptcy Code. In a separate declaration, Mr. Jamal told the Court that the Liquidation Analysis and Valuation Analysis reflect that the Plan is in the best interest of the Debtors' creditors. Mr. Jamal believes that substantive consolidation will promote efficiency and decrease costs in the implementation of the Plan, and therefore benefits all creditors. The Debtors delivered to the Court, on December 17, a memorandum of law in support of the proposed order approving their Disclosure Statement. A full-text copy of the Memorandum is available for free at http://bankrupt.com/misc/AMI_MemoPlan1217.pdf Disclosure Statement Approval Judge Glenn also approved the Disclosure Statement accompanying the Prepackaged Plan as containing adequate information as that term is defined in Section 1125(a) of the Bankruptcy Code. All objections and all reservations of rights that have not been withdrawn, waived or settled pertaining to confirmation of the Plan and adequacy of the Disclosure Statement are overruled on the merits. Specifically, but without limitation, the Disclosure Statement complies with the requirements of Rule 3016(c) of the Federal Rules of Bankruptcy Procedure by sufficiently describing in specific and conspicuous bold language the provisions of the Plan that provide for releases and injunctions against conduct not otherwise enjoined under the Bankruptcy Code and sufficiently identifies the persons and entities that are subject to the releases and injunctions. Judge Glenn held that, notwithstanding the fact that Class 7 has voted not to accept the Plan and Class 10 is deemed to reject the Plan, the Plan may be confirmed pursuant to Bankruptcy Code Section 1129(b)(1) because: (a) Classes 2, 5 and 6 are impaired and have voted to accept the Plan; and (b) the Plan does not discriminate unfairly and is fair and equitable with respect to the Rejecting Classes. According to the Judge Glenn, the Plan does not unfairly discriminate because members within each Class are treated similarly. Accordingly, the Plan does not discriminate unfairly with respect to the Rejecting Classes or any other Class of Claims or Interests. Other than the Plan, no other plan has been filed in the Chapter 11 cases. Accordingly, the requirements of Section 1129(c) have been satisfied. No governmental unit has requested that the Court refuse to confirm the Plan on the grounds that the principal purpose of the Plan is the avoidance of taxes or the avoidance of the application of section 5 of the Securities Act. As evidenced by its terms, the principal purpose of the Plan is not that avoidance. Accordingly, the requirements of Section 1129(d) have been satisfied. Conditions to Plan Effectivity AMI's Plan of Reorganization will be effective upon satisfaction of all closing conditions, including the closing of AMI's previously announced Revolving Credit Facility with JPMorgan Chase Bank, N.A., and the issuance of AMI's 13-1/2% Second Lien Senior Secured Notes due 2018. On or immediately prior to the Effective Date, the Reorganized Debtors are authorized to, (i) file each of their Restated Certificates of Incorporation with the Delaware Secretary of State, (ii) adopt each of their Restated Bylaws and (iii) adopt the Stockholders Agreement. Boards of Directors and Officers The boards of directors and officers of each of the Reorganized Debtors have been identified in the Plan Supplement, and the Reorganized Debtors will be authorized to employ those officers without further order of the Court or other further action by any other person or entity. Cancellation of Interests On the Effective Date, all notes, instruments, certificates, and other documents evidencing Interests will be cancelled, terminated and extinguished and the obligations of the Debtors thereunder or in any way related thereto will be discharged including, but not limited to, (a) the Interests in AMI and (b) any options or warrants to purchase Interests of AMI, or obligating those Debtors to issue, transfer or sell Interests or any other capital stock of those Debtors. New Financing On the Effective Date, (i) the AMO Escrow Corporation and New LLC are authorized to merge into Reorganized AMI immediately following the merger of AMO into Reorganized AMI, which will assume AMO Escrow Corporation's obligations under the New First Lien Notes, the New First Lien Indenture and the related registration rights agreement, and (ii) the proceeds of the New First Lien Notes Offering will be released from escrow. Also, on the Effective Date, the Reorganized Debtors, as applicable, are authorized to: (a) enter into or assume, as applicable, and deliver the documents and agreements related to the New Financing, including all guarantees and security documents, and the registration rights agreement relating to the New Second Lien Notes; (b) execute and deliver those security documents, control agreements, certificates, financing statements and other documentation as required under the terms of the New Financing or as the applicable agents under the New Financing reasonably request; and (c) deliver insurance and customary opinions, and those documents and all other documents, instruments and agreements to be entered into, delivered or contemplated thereunder will become effective in accordance with their terms on the Effective Date. Executory Contracts and Unexpired Leases On the Effective Date, all executory contracts or unexpired leases of the Debtors, other than any executory contract or unexpired lease that (a) was previously assumed or rejected or (b) is subject to a pending motion to assume or reject as of the Confirmation Date, will be deemed assumed as of the Confirmation Date in accordance with, and subject to, the provisions and requirements of Sections 365 and 1123 of the Bankruptcy Code. All executory contracts or unexpired leases assumed by the Debtors will remain in full force and effect for the benefit of the Reorganized Debtors and be enforceable by the Reorganized Debtors in accordance with their terms notwithstanding any provision in those Assumed Agreements that purports to prohibit, restrict or condition that assumption. The assumption of the Assumed Agreements will be free and clear of all liens, encumbrances, pledges, mortgages, deeds of trust, security interests, claims, charges, options, rights of first refusal, easements, servitudes, proxies, voting trusts or agreements, or transfer restrictions under any shareholder or similar agreement or encumbrance. Employee Benefits All employee, retirement and other agreements or arrangements in place as of the Effective Date with the Debtors' officers, directors, or employees, who will continue in those capacities or similar capacities after the Effective Date, or retirement plans and welfare benefit plans for those persons, will remain in place after the Effective Date, and the Reorganized Debtors will continue to honor those agreements, arrangements, programs and plans. On and after the Effective Date, all retiree benefits will continue to be paid in accordance with applicable law. Incentive and Severance Plans The terms of the Equity Incentive Plan, the Director Severance Plan and the Emergence Incentive Plan are approved, and the Debtors and Reorganized Debtors are authorized, without further approval of the Court or any other party, to execute and deliver all agreements, documents, instruments and certificates relating to the Equity Incentive Plan, the Director Severance Plan and the Emergence Incentive Plan, and to perform their obligations thereunder. All objections to confirmation of the Plan and all reservations of rights that have not been withdrawn, waived or settled, pertaining to the confirmation of the Plan are overruled on the merits. A full-text copy of the Confirmed Plan is available for free at http://bankrupt.com/misc/AMI_ConfirmedPlan.pdf A full-text copy of the Plan Confirmation and Disclosure Statement Approval Order is available for free at: http://bankrupt.com/misc/AMI_DSOrd.pdf About American Media Based in New York, American Media, Inc., publishes celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI manages 14 different Web sites. The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company. American Media, Inc., and 15 units, including American Media Operations, Inc., filed for Chapter 11 protection in Manhattan (Bankr. S.D.N.Y. Case No. 10-16140) on November 17, 2010. American Media filed together with the petition, a pre-packaged Chapter 11 plan where holders of notes and bank debt would receive either cash, new notes or stock. American Media said it would try to emerge from court protection against creditors in 60 days or less. Judge Martin Glenn presides over the case. Ira S. Dizengoff, Esq., Arik Preis, Esq., Meredith A. Lahaie, Esq., Stefanie L. Kurlanzik, Esq., and Kevin M. Eide, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serve as the Debtors' bankruptcy counsel. Moelis & Company is the Debtors' financial advisors and investment bankers. Kurtzman Carson Consultants LLC is the claims and notice agent. AMI estimated assets of $0 to $50,000 and debts of $500 million to $1 billion in its Chapter 11 petition. AMO, AMI's operating unit, estimated assets of $100 million to $500 million and debts of $500 million to $1 billion in its Chapter 11 petition. Bankruptcy Creditors' Service, Inc., publishes American Media Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by American Media Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) AMERICAN MEDIA: Court OKs Access to Cash Collateral Until Feb. 17 ----------------------------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York authorized American Media, Inc., and its debtor affiliates to use cash collateral on a final basis through February 17, 2011. Cash Collateral may be: (i) used in the ordinary course of business for working capital and general corporate purposes; (ii) used for the payment of Professional Fees and other fees and expenses, in each case, to the extent of the Carve Out; (iii) used to make Adequate Protection Payments; (iv) used for the payment of expenses not incurred in the ordinary course of business, in an aggregate amount during the Specified Period not to exceed $5,000,000; and (v) transferred to AMO Escrow Corporation Escrow Issuer for the payment of fees, interest and other amounts relating to the escrow of proceeds from the offering of New First Lien Notes and New Second Lien Notes to the extent that transfer is approved by order of the Bankruptcy Court, in an aggregate amount during the Specified Period not to exceed $15,000,000; provided, however, that during the Remedies Notice Period, the Debtors may use Cash Collateral solely to meet payroll obligations and to pay expenses critical to the preservation of the Debtors and their estates, including the Adequate Protection Payments and Professional Fees to the extent of the Carve Out; and provided further, however, that during the Specified Period, the Debtors are limited to the use of Cash Collateral to no more than an aggregate amount of $65,500,000. A full-text copy of the Final Cash Collateral Order is available for free at http://bankrupt.com/misc/AMI_FinCashCollord.pdf About American Media Based in New York, American Media, Inc., publishes celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI manages 14 different Web sites. The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company. American Media, Inc., and 15 units, including American Media Operations, Inc., filed for Chapter 11 protection in Manhattan (Bankr. S.D.N.Y. Case No. 10-16140) on November 17, 2010. American Media filed together with the petition, a pre-packaged Chapter 11 plan where holders of notes and bank debt would receive either cash, new notes or stock. American Media said it would try to emerge from court protection against creditors in 60 days or less. Judge Martin Glenn presides over the case. Ira S. Dizengoff, Esq., Arik Preis, Esq., Meredith A. Lahaie, Esq., Stefanie L. Kurlanzik, Esq., and Kevin M. Eide, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serve as the Debtors' bankruptcy counsel. Moelis & Company is the Debtors' financial advisors and investment bankers. Kurtzman Carson Consultants LLC is the claims and notice agent. AMI estimated assets of $0 to $50,000 and debts of $500 million to $1 billion in its Chapter 11 petition. AMO, AMI's operating unit, estimated assets of $100 million to $500 million and debts of $500 million to $1 billion in its Chapter 11 petition. Bankruptcy Creditors' Service, Inc., publishes American Media Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by American Media Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) AMERICAN MEDIA: Wins Final Nod for Ordinary Course Professionals ---------------------------------------------------------------- American Media Inc. and its units obtained final approval for streamlined procedures for the retention and compensation of ordinary course professionals after the Petition Date. The Debtors employ various attorneys and other professionals in the ordinary course of their businesses. The Ordinary Course Professionals provide services for the Debtors in a variety of matters unrelated to these Chapter 11 cases, including legal services with regard to specialized areas of the law, like corporate governance regulation, accounting services, auditing and tax services, and certain consultants. A list of the Debtors' current OCPs is available for free at: http://bankrupt.com/misc/AMI_OCPList.pdf The Debtors have designed streamlined procedures for the retention and compensation of OCPs after the Petition Date. A full-text copy of the Procedures is available for free at: http://bankrupt.com/misc/AMI_OCPProcedures.pdf The OCP Procedures will permit the Debtors to employ OCPs upon the filing of a declaration of disinterestedness and a brief objection period for certain parties, including the U.S. Trustee for the Southern District of New York and any statutory committee appointed in these Chapter 11 cases. Among other things, each Declaration of Disinterestedness will state that the respective OCP does not have any material interest adverse to the Debtors or their estates. The OCP Procedures further provide that all OCP fees and expenses, excluding costs and disbursements, will not exceed $50,000 per month and that each OCP's fees, excluding costs and disbursements, will not exceed $300,000 in the aggregate for these Chapter 11 cases. Additionally, the Debtors seek to reserve the right to retain additional OCPs from time to time during these cases by (a) including those OCPs on an amended version of the OCP List to be filed with the Court and served on the Notice Parties and (b) having those OCPs comply with the OCP Procedures. About American Media Based in New York, American Media, Inc., publishes celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI manages 14 different Web sites. The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company. American Media, Inc., and 15 units, including American Media Operations, Inc., filed for Chapter 11 protection in Manhattan (Bankr. S.D.N.Y. Case No. 10-16140) on November 17, 2010. American Media filed together with the petition, a pre-packaged Chapter 11 plan where holders of notes and bank debt would receive either cash, new notes or stock. American Media said it would try to emerge from court protection against creditors in 60 days or less. Judge Martin Glenn presides over the case. Ira S. Dizengoff, Esq., Arik Preis, Esq., Meredith A. Lahaie, Esq., Stefanie L. Kurlanzik, Esq., and Kevin M. Eide, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serve as the Debtors' bankruptcy counsel. Moelis & Company is the Debtors' financial advisors and investment bankers. Kurtzman Carson Consultants LLC is the claims and notice agent. AMI estimated assets of $0 to $50,000 and debts of $500 million to $1 billion in its Chapter 11 petition. AMO, AMI's operating unit, estimated assets of $100 million to $500 million and debts of $500 million to $1 billion in its Chapter 11 petition. Bankruptcy Creditors' Service, Inc., publishes American Media Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by American Media Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) AMERICAN MEDIA: Wins Nod to Honor Prepetition Customer Obligations ------------------------------------------------------------------ American Media Inc. and its affiliates sought and obtained the U.S. Bankruptcy Court's final approval to honor certain prepetition obligations to customers and certain retail outlets utilized to distribute their publications, and to otherwise continue customer and distribution programs and practices in the ordinary course of business. The Debtors also sought and obtained the Court's order authorizing and directing financial institutions to receive, process, honor and pay all checks presented for payment and electronic payment requests. Prior to the Petition Date and in the ordinary course of business, the Debtors engaged in certain practices to develop and sustain a positive reputation in the marketplace for their publications and maximize their sales and advertising revenues. These practices include, among other things, (1) rebates, credits and warranties to advertisers that purchase advertising in the Debtors' publications, (2) refunds paid or credited to wholesalers and distributors of the Debtors' publications for unsold copies, (3) honoring subscriptions paid in advance by subscribers to the Debtors' publications, and (4) the payment of prizes to winners of contests run by the Debtors in their publications. According to the Debtors, the goals of the Customer and Distribution Programs have been and are to meet competitive pressures, ensure customer satisfaction, maximize sales, and generate goodwill, thereby retaining current customers, attracting new ones, and ultimately enhancing net revenues. The Debtors believe that, as of the Petition Date, their liability for prepetition Customer and Distribution Programs total $36,074,065: Advertising Rebates and Credits $1,501,965 Advertising Refund 642,000 Prepaid Subscriptions 33,780,000 Prepetition Subscription Cancellations 135,000 Contest Prizes 15,100 About American Media Based in New York, American Media, Inc., publishes celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI manages 14 different Web sites. The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company. American Media, Inc., and 15 units, including American Media Operations, Inc., filed for Chapter 11 protection in Manhattan (Bankr. S.D.N.Y. Case No. 10-16140) on November 17, 2010. American Media filed together with the petition, a pre-packaged Chapter 11 plan where holders of notes and bank debt would receive either cash, new notes or stock. American Media said it would try to emerge from court protection against creditors in 60 days or less. Judge Martin Glenn presides over the case. Ira S. Dizengoff, Esq., Arik Preis, Esq., Meredith A. Lahaie, Esq., Stefanie L. Kurlanzik, Esq., and Kevin M. Eide, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serve as the Debtors' bankruptcy counsel. Moelis & Company is the Debtors' financial advisors and investment bankers. Kurtzman Carson Consultants LLC is the claims and notice agent. AMI estimated assets of $0 to $50,000 and debts of $500 million to $1 billion in its Chapter 11 petition. AMO, AMI's operating unit, estimated assets of $100 million to $500 million and debts of $500 million to $1 billion in its Chapter 11 petition. Bankruptcy Creditors' Service, Inc., publishes American Media Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by American Media Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) AMERIQUAL GROUP: Moody's Junks Corporate Family Rating From 'B3' ---------------------------------------------------------------- Moody's Investors Service downgraded its debt ratings of AmeriQual Group, LLC: Corporate Family and Probability of Default, each to Caa1 from B3 and senior secured second lien notes to Caa2 from Caa1. Moody's also lowered the speculative grade liquidity rating to SGL-4. The ratings outlook is developing. This completes the review initiated on August 13, 2010. Ratings Rationale The downgrades reflect Ameriqual's weakened credit profile due to the continuing absence of a multi-year contract that sustains the company's Meals, Ready to Eat market share and secures a steady flow of earnings after the December 31, 2011 expiry of the one- year extension contract. The absence of the follow-on contract combined with both the upcoming expiration of Ameriqual's $35 million revolver in January of 2012 and the maturity of its second lien notes in April of the same year prompted the downgrades. The lower SGL rating of SGL-4 underscores the upcoming maturities of the company's debt structure over the next thirteen months. The developing outlook considers that if the company is able to renew its multi-year position as the U.S. Department of Defense's top MRE provider, volume prospects should be enough to stabilize the outlook and upgrade the CFR to be reflective of a credit profile supported by the steady stream of earnings stemming from such a contract and confirmation of the company's top market position. Alternatively, the ratings could be lowered further should the five-year contract not be put in place, the company loses its incumbent top share position, the pricing/volume is reset at lower than historical levels, or a refinancing of the company's debt to address upcoming maturities is not successful. The Caa1 rating incorporates the uncertainty regarding the timing of renewal of the multi-year MRE contract with the DOD. The Caa1 CFR also reflects the company's small size, high customer concentration and volatility associated with MRE-derived contract revenue. However, the CFR rating also acknowledges the company's eight-year track record as the incumbent top MRE provider to the DOD and that Ameriqual is currently one of only three companies approved by the DOD to supply MREs. The current liquidity is being categorized as weak primarily due to the approaching maturities of Ameriqual's debt structure during early 2012 and lack of alternate sources of liquidity as all assets are pledged under current debt agreements. However, it should also be noted that the company has been generating positive free cash flow, even after tax-related distributions, over the last few years. Upon a successful refinancing of the company's debt, the SGL rating would be revisited for an upward adjustment. Ratings lowered: -- Corporate Family Rating, to Caa1 from B3, -- Probability of Default Rating, to Caa1 from B3, -- $85 million 9.5% second lien notes due April 2012, to Caa2 (LGD 4, 69%) from Caa1 (LGD4, 66%), -- Speculative Grade Liquidity Rating, to SGL-4 from SGL-3 Moody's last rating action on Ameriqual occurred on August 13, 2010 when the ratings were put under review for possible downgrade. Ameriqual Group, LLC, headquartered in Evansville, Indiana, is a supplier of individual and group field rations to the U.S. Department of Defense. The company also provides contract manufacturing and packaging services using thermal or high pressure processes to consumer products and other food distribution companies. APPALACHIAN OIL: Plan of Liquidation Wins Court Approval -------------------------------------------------------- The Hon. Marcia Phillips Parsons of the U.S. Bankruptcy Court for the Eastern District of Tennessee confirmed Appalachian Oil Company, Inc.'s Second Amended Plan of Liquidation. As reported in the Troubled Company Reporter on November 3, 2010, the Plan calls for the liquidation of APPCO's remaining assets and the distribution of the proceeds derived therefrom in accordance with the Plan. The funding for the Plan will come from three sources, the funds held by the Official Committee of Unsecured Creditors, preference recoveries collected by the Debtor, and postpetition receivables due the Debtor. A full-text copy of the Confirmation Order and the Amended Plan is available for free at: http://bankrupt.com/misc/APPALACHIANOIL_confirmationorder&plan.pdf About Appalachian Oil Appalachian Oil sought Chapter 11 protection on February 9, 2009 (Bankr. Case E.D. Tenn. No. 09-50259). Mark S. Dessauer, Esq., at Hunter, Smith & Davis, in Kingsport, Tennessee, represents the Debtor. The Debtor estimated assets and debts at $10 million and $50 million. The Company's creditors with the biggest unsecured claims are BP Plc's Amoco/BP, owed $2.41 million, and fuel distributor Crescent Oil Co., owed $1.6 million. ARTECITY PARK: U.S. Trustee Unable to Form Creditors Committee -------------------------------------------------------------- The Office of the U.S. Trustee for Region 21 notified the U.S. Bankruptcy Court for the Southern District of Florida that until further notice, it will not appoint an official committee of unsecured creditors in the Chapter 11 cases of Artecity Park LLC, et al. Miami Beach, Florida-based Artecity Park LLC filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. S.D. Fla. Case No. 10-31410). Thomas R. Lehman, Esq., who has an office in Miami, Florida, represents the Debtor. The Company estimated assets at $50 million to $100 million and debts at $10 million to $50 million. Affiliates Artecity Governor LLC, Artecity Holding LTD, and Artecity Management LLC also filed for Chapter 11. The cases are jointly administered under Artecity Management LLC. ARTECITY PARK: Plan Outline Hearing Continued Until January 20 -------------------------------------------------------------- The Hon. A. Jay Cristol of the U.S. Bankruptcy Court for the Southern District of Florida has continued until January 20, 2011, at 2:00 p.m., the hearing to consider adequacy of the Disclosure Statement explaining Artecity Management LLC et al.'s Plan of Liquidation. The Debtors and Corus Construction Venture, LLC, agreed to continue the Disclosure Statement hearing to allow the Debtors time to amend the Disclosure Statement. The Court ordered that the Debtors file an amended Disclosure Statement at least seven days prior to the hearing. The Debtors will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the current iteration of the Disclosure Statement, the Debtors propose to substantively consolidate the assets and liabilities of their estates. The balance of CCV DI loan will be paid on the effective date from the exit loan proceeds and all rights granted to CCV under the CCV DIP loan will be assigned to the exit lenders as of the effective date. In addition to the paying the balance of the CCV DIP loan, proceeds from the exit loan will be used to pay allowed claims. Other allowed claims and the exit loan will be paid from proceeds of the sale of unsold condominium units. Pursuant to the terms of the Plan: i) unpaid allowed administrative expense claims and U.S. Trustee fees will be paid in full on the effective date, which the Debtors estimate to be April 1, 2011; ii) individual holders of allowed priority unsecured deposit claims in Class 1 will be paid the allowed amount of their claim; iii) the allowed secured claim of Miami-Dade County ax Collector in Class 2 will be paid from sale proceeds upon the earlier closing of sales of condominium units; iv) the allowed CCV secured claim in Class 3 will be paid an amount equal to the CCV secured claim payment; and v) the allowed CCV deficiency claim, allowed unsecured mechanics' lien claims, and unsecured claims in Class 4A to 4C will be paid a quarterly pro rata distribution equal to the amount of unsecured claims payment upon the earlier of full payment of the CCV secured claim or exit loan. general unsecured claims will receive an estimated distribution of between 15% to 40% of their allowed claims. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/Artecity_DS.pdf About Artecity Park LLC Miami Beach, Florida-based Artecity Park LLC filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. S.D. Fla. Case No. 10-31410). Thomas R. Lehman, Esq., who has an office in Miami, Florida, represents the Debtor. The Company estimated assets at $50 million to $100 million and debts at $10 million to $50 million. Affiliates Artecity Governor LLC, Artecity Holding LTD, and Artecity Management LLC also filed for Chapter 11. The cases are jointly administered under Artecity Management LLC. ARTZ RIB: Files for Chapter 11 Bankruptcy Protection ---------------------------------------------------- Austin Business Journal reports that Artz Rib House has filed for Chapter 11 bankruptcy protection to reorganize, but the owner said the restaurant remains open, has lined up investors and expects the iconic restaurant to come back "bigger and better. Owner Art Blondin, who opened the rib house two decades ago, said details will be coming soon on his plan. He declined to elaborate or discuss the size of the investments. In 2009, Mr. Blondin closed down the barbecue and live music venue due to his wife's medical issues and mounting financial woes that had been exasperated by the slowing economy. According to the report, the restaurant estimated assets of less than $50,000 and liabilities between $100,000 and $500,000. ASIAN ART MUSEUM: Receives 30-Day Forbearance From JPMorgan ----------------------------------------------------------- Randall Jensen, writing for The Bond Buyer, reports that the Asian Art Museum's foundation in San Francisco said it has received a 30-day extension on some obligations related to the expiration of a letter of credit from JPMorgan Chase & Co. Tuesday backing $120 million in bonds. According to the report, the foundation's 30-day forbearance agreement between JPMorgan and MBIA will give the parties time to negotiate a "suitable" restructuring of the 2005 variable-rate revenue bonds, museum spokesman Tim Hallman said in a statement late Tuesday. According to Mr. Jensen, Moody's Investors Service said in a report Friday that the negotiations centered on the time frame of the potential accelerated payments that should have kicked in at a tight five-year schedule after the expiration of the LOC. Due the expiration of the letter of credit, Moody's lowered the foundation's underlying rating to junk status, to Ba1 from Baa1, and kept it on watch for another downgrade. Moody's said if the foundation is required to repay the bank bonds in quarterly payments over five years, its annual payments would hit $29.85 million plus interest, with the first $6 million payment due March 21. As reported by the Troubled Company Reporter on November 24, 2010, Jacqueline Palank, writing for Dow Jones' Daily Bankruptcy Review, said the Asian Art Museum's chief finance and operating officer, Mark McLoughlin, told the San Francisco Chronicle that officials are working to resolve the museum's financial woes. Mr. McLoughlin had told The Wall Street Journal that while the museum has hired a bankruptcy attorney to help it negotiate with creditors, it doesn't plan to seek bankruptcy protection. Mr. Jensen notes the foundation is the fundraising arm of the museum, which has the largest Asian art collection in the Western world. ATLANTIC BROADCASTING: Financial Woes Prompt Bankruptcy Filing -------------------------------------------------------------- Atlantic Broadcasting of Linwood filed for Chapter 11 protection in Camden, New Jersey on Dec. 20, 2010 (Bankr. D. N.J. Case No. 10-49149). Atlantic Broadcasting is the owner of five southern New Jersey radio stations including classic-rock station WMGM-FM 103.7, oldies station WTKU-FM 98.3, top-40 rhythmic station WWAC-FM 102.7, news-talk station WOND-AM 1400 and Spanish station WTAA-AM 1490. Elaine Rose, staff writer at pressofAtlanticCity.com, reports that Atlantic Broadcasting has been experiencing financial difficulties in recent months. Several on-air personalities were laid off in November, and said they were told the reason was "a budget issue." The Debtor estimated assets and debts of $1 million to $10 million. Debt includes n half a million dollars owed to the Arbitron ratings company, $116,322 owed to the American Society of Composers, Authors and Publishers, $35,000 owed to CBS Sports and $25,165 owed to The Associated Press. ATLANTIC BROADCASTING: Case Summary & 20 Largest Unsec Creditors ---------------------------------------------------------------- Debtor: Atlantic Broadcasting of Linwood NJ Limited Liability Company 1601 New Road Linwood, NJ 08221-1116 Bankruptcy Case No.: 10-49149 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court District of New Jersey (Camden) Judge: Judith H. Wizmur Debtor's Counsel: Joshua T. Klein, Esq. FOX, ROTHSCHILD LLP 2000 Market Street, 20th Floor Philadelphia, PA 19103-3291 Tel: (215) 299-2000 E-mail: jklein@foxrothschild.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/njb10-49149.pdf The petition was signed by John Caracciolo, president and acting CEO. AUTO CENTER: Case Summary & 3 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Auto Center Auto Body LLC 28710-B Las Haciendas Street, Suite 101 Temecula, CA 92590 Bankruptcy Case No.: 10-50929 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Central District of California (Riverside) Judge: Meredith A. Jury Debtor's Counsel: Jennifer Urquizu, Esq. AFFORDABLE LEGAL SOLUTIONS 42690 Rio Nedo, Suite F Temecula, CA 92590 Tel: (951) 296-5492 Fax: (951) 639-6063 E-mail: lray@affordablels.com Scheduled Assets: $1,900,000 Scheduled Debts: $2,967,098 A list of the Company's three largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-50929.pdf The petition was signed by Lidia Ridder, member of LLC. BEAR CREEK: Court Dismisses Case for Lack of Means to Reorganize ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Michigan has dismissed the Chapter 11 bankruptcy proceedings commenced against Bear Creek Partners I, LLC. The Debtor's real estate lender and principal secured creditor, a real estate trust, acting through a servicer, CWCapital Asset Management LLC, concurred with the U.S. Trustee's request for dismissal of the Chapter 11 case. Several creditors who signed the involuntary Chapter 11 petition opposed the dismissal. The United States Trustee, the moving party, argued that because the Debtor lacks reasonable means to reorganize or confirm a feasible plan, cause exists for dismissal. The Debtor owes the principal secured creditor at least $12,500,000, while the Debtor's principal assets, the 120-unit Bear Creek Meadows Apartments, is worth only $2,500,000. Thus, the real estate trust is substantially undersecured. Bear Creek Partners I, LLC, is a special purpose entity holding title to an apartment complex in Petoskey, Michigan. On June 24, 2010, four creditors of the Company filed involuntary Chapter 11 petitions (Bankr. W.D. Mich. Case No. 10-07906) against the Company. Robert F. Wardrop, II, Esq., at Wardrop & Wardrop, P.C., in Grand Rapids, Michigan, is the petitioning creditors' counsel. The creditors who signed the Chapter 11 petition are Fryling Construction Company, Inc., owed $834,079; Benchmark Engineering, owed $27,112; Lakeview Cleaning & Restoration, owed $12,254; and MARCO, LLC, owed $10,515. BEEHIVE CREDIT: Falls Into Receivership, Texas C.U. Takes Over -------------------------------------------------------------- Government employee based Beehive Credit Union out of Salt Lake City was given over to the NCUA for liquidation, and its assets were taken over by Security Service Federal Credit Union out of San Antonio, Examiner reports. According to Deseret News, at closure, Beehive had approximately $145 million in assets and served 18,000 members. Beehive was established in 1954 to serve employees of Utah state government. San Antonio-based Security Service Federal Credit Union has purchased and assumed Beehive's assets, liabilities and members. Behive is the 18th federally insured credit union liquidation of 2010. To date, the Examiner says that there have been few Credit Union closures in comparison to the 151 banks that have shuttered their doors in 2010. However, the report relates this will be a strong indicator of the financial system as a whole since credit unions represent a more conservative approach to banking, and are by nature stronger than their FDIC counterparts. BELL, CALIFORNIA: Needs Drastic Cuts in City Services, Audit Finds ------------------------------------------------------------------ American Bankruptcy Institute reports that the city of Bell, Calif., is hovering on the brink of insolvency and drastic cuts in city services probably will be necessary to fix its finances, according to a review of the city's books that Los Angeles County officials plan to release next month. As reported in the Troubled Company Reporter on Oct. 1, 2010, City News Service said that the Los Angeles County Board of Supervisors called on the state attorney general to appoint a receiver to take over the day-to-day management of the city of Bell, California. City News Services said that on a 4-0 vote, with Supervisory Mike Antonovich absent, the board approved a motion by Sup. Gloria Molina calling on Atty. Gen. Jerry Brown to "use every legal measure at his disposal . . . to immediately prevent any potential for continuing harm to the residents of Bell." Ms. Molina's motion, written before arrests of eight current and former Bell officials, also calls on Brown to prohibit the Bell City Council from appropriating any funds or entering into an contracts on behalf of the city. BERNARD L MADOFF: Greenwich to Sue Fairfield for Breach ------------------------------------------------------- Bankruptcy Law360 reports that limited partners in Greenwich Sentry LP and Greenwich Sentry Partners LP, two bankrupt feeder funds linked to Bernard L. Madoff's Ponzi scheme, have asked a bankruptcy judge for permission to bring shareholder derivative suits that claim Fairfield Greenwich (Bermuda) Ltd., the funds' general partner, breached its fiduciary duty. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) As of October 29, 2010, a total of US$5.69 billion in claims by investors has been allowed, with US$741.2 million to be paid by the Securities Investor Protection Corp. Investors are expected to receive additional distributions from money recovered by Mr. Picard from lawsuits or settlements. BIG CABIN: Case Summary & 2 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Big Cabin Properties, LLC P.O. Box 1030 Coeur D Alene, ID 83816 Bankruptcy Case No.: 10-21667 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court District of Idaho (Coeur dAlene) Judge: Terry L. Myers Debtor's Counsel: David E. Eash, Esq. 2101 Lakewood Dr Ste 236 Coeur d Alene, ID 83814 Tel: (208) 667-7990 Fax: (509) 838-4906 E-mail: deash@ewinganderson.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/idb10-21667.pdf The petition was signed by Brian L. Schafer, president. BIOFUEL ENERGY: Seeks Confidential Treatment of Exhibit ------------------------------------------------------- BioFuel Energy Corp. submitted an application under Rule 24b-2 requesting confidential treatment for information it excluded from the Exhibits to a Form 8-K filed on September 27, 2010. The 8-K relates to BioFuel Energy entry on September 24, 2010, into a loan agreement with Greenlight Capital, LP, Greenlight Capital Qualified, LP, Greenlight Capital (Gold), LP, Greenlight Capital Offshore Partners, Greenlight Capital Offshore Master (Gold), Ltd., Greenlight Reinsurance, Ltd. and Third Point Loan LLC and Greenlight APE, LLC, as administrative agent, pursuant to which the Company borrowed $19,420,620. The Exhibit treated as confidential is a Letter Agreement dated as of September 23, 2010, by and among BioFuel Energy Corp., BFE Operating Company, LLC, Pioneer Trail Energy, LLC, Buffalo Lake Energy, LLC, Cargill, Incorporated and Cargill Commodity Services, Inc. Based on representations by BioFuel Energy Corp. that this information qualifies as confidential commercial or financial information under the Freedom of Information Act, 5 U.S.C. 552(b)(4), the Division of Corporation Finance has determined not to publicly disclose it. About Biofuel Energy Denver, Colo.-based BioFuel Energy Corp. (Nasdaq: BIOF) -- http://www.bfenergy.com/-- currently has two 115 million gallons per year ethanol plants in the Midwestern corn belt. The Company's goal is to become a leading ethanol producer in the United States by acquiring, developing, owning and operating ethanol production facilities. The Company's balance sheet at September 30, 2010, showed $329.7 million in total assets, $274.6 million in total liabilities, and stockholders' equity of $55.1 million. As reported in the Troubled Company Reporter on March 31, 2010, Grant Thornton LLP, in Denver, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has experienced declining liquidity and has $16.5 million of outstanding working capital loans that mature in September 201 "If we are unable to raise sufficient proceeds from the rights offering, the LLC's concurrent private placement, or from other sources, we may be unable to continue as a going concern, which could potentially force us to seek relief through a filing under the U.S. Bankruptcy Code," the Company said in its Form 10-Q for the third quarter of 2010. Biofuel reported a net loss of $1.8 million on $114.7 million of revenue for the three months ended September 30, 2010, compared with a net loss of $8.4 million on $91.1 million of revenue for the same period last year. BIOLASE TECHNOLOGY: CFO Furry Does Not Own Any Securities --------------------------------------------------------- In a Form 3 filing with the Securities and Exchange Commission on December 10, 2010, Frederick D. Furry, chief financial officer at Biolase Technology Inc., disclosed that it does not own any securities of the company. About BIOLASE Technology Irvine, Calif.-based BIOLASE Technology, Inc. (NASDAQ: BLTI) -- http://www.biolase.com/-- is a dental laser company. The Company develops, manufactures and markets Waterlase technology and lasers and related products that advance the practice of dentistry and medicine. The Company's balance sheet at Sept. 30, 2010, showed $19.49 million in total assets, $23.04 million in total liabilities, and a stockholders' deficit of $3.54 million. As reported in the Troubled Company Reporter on March 22, 2010, BDO Seidman, LLP, in Costa Mesa, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations, has had declining revenues, has limited financial resources at December 31, 2009, and is substantially dependent upon its primary distributor for future purchases of the Company's products. BLANCA LLC: Bankruptcy Court Dismisses Debtor's Chapter 11 Case --------------------------------------------------------------- On December 20, 2010m the U.S. Bankruptcy Court for the Central District of California entered an order dismissing Blanca LLC's bankruptcy case. Based upon the Court's review of Debtor's proposed First Amended Chapter 11 Plan which was heard by the Court on December 13, 2010, the comments of East West Bank and Bank of the West to the proposed plan, the previous pleadings filed in the Debtor's case, and the arguments of counsel, the Court finds that the Debtor will be unable to confirm a Chapter 11 plan. Blanca, LLC, is also barred from refiling any petition under the United States Bankruptcy Code for 180 days from the date of the entry of the dismissal order. Downey, California-based Blanca, LLC, filed for Chapter 11 bankruptcy protection on February 23, 2010 (Bankr. C.D. Calif. Case No. 10-16519). Carolyn A. Dye, Esq., who has an office in Los Angeles, California, assists the Company in its restructuring effort. BLB WORLDWIDE: S&P Assigns 'B+' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services assigned BLB Worldwide Holdings Inc. its corporate credit rating of 'B+'. The rating outlook is stable. At the same time, S&P assigned BLB Management Services Inc.'s $300 million term loan due 2015 its issue-level rating of 'BB-' (one notch higher than the corporate credit rating). S&P also assigned this debt a recovery rating of '2', indication its expectation of substantial (70%-90%) recovery for lenders in the event of a payment default. The term loan is guaranteed by parent BLB Worldwide Holdings and the borrower's UTGR Inc. subsidiary. "The 'B+' corporate credit rating reflects BLB's reliance on a single property for cash flow, competitive dynamics in the region, and stringent revenue allocation structure imposed by the State of Rhode Island on video lottery terminal win (which limits profitability)," said Standard & Poor's credit analyst Melissa Long, "as well as S&P's expectation that the U.S. economy will only gradually improve over the next few years." Twin River's favorable location, and S&P's expectation that credit measures will gradually improve over the next few years as S&P anticipates positive free operating cash flow will largely be applied toward debt repayment only partially offset these negative factors. BLOCKBUSTER INC: Not Hopelessly Insolvent, M. Rudd Asserts ---------------------------------------------------------- Mark L. Rudd filed with the Court a letter in response to Blockbuster Inc. and its units' reply to his request to appoint an equity committee. Mr. Rudd's letter, which is addressed to Brian Masumoto, Esq., of the Office of the United States Trustee, is a response to the letter sent by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP, in New York, on the Debtors' behalf. Mr. Rudd contends that Mr. Karotkin does not address most of the issues raised in the appointment request. "In a nutshell, his response is to assert that Debtors are hopelessly insolvent, therefore the common shareholders are out of the money, so he need not address the analysis, and from that concludes that the appointment of an equity committee is unwarranted," Mr. Rudd argues. "I believe this to be a wholly inadequate response further justifying my request of an equity committee," he continues. Mr. Karotkin, in his letter, stated that the Debtors do not believe there is any basis, factually or legally, for the appointment of an equity committee in the bankruptcy cases. Mr. Karotkin added that the Debtors are hopelessly insolvent and existing equity has no real economic stake in the reorganization cases, and hence, the appointment of an equity committee simply is not warranted. The Debtors and the Secured Noteholders together have taken the extreme position that the common shareholder will be "wiped out," Mr. Rudd alleges. He points out, among other things, that statements and boilerplate claims, like that Blockbuster is "hopelessly insolvent," are made to facilitate the end goal of 100% ownership of Blockbuster by their clients -- the Secured Noteholders. About Blockbuster Inc. Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA, BLOKB) -- http://www.blockbuster.com/-- is a global provider of rental and retail movie and game entertainment. It has a library of more than 125,000 movie and game titles. Blockbuster said it had assets of $1,017,035,832 and debts of $1,464,939,759 as of August 1, 2010. Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan on September 23, 2010 (Bankr. S.D.N.Y. Case No. 10-14997). Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. A steering group of senior secured noteholders is represented by James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin LLP. U.S. Bank National Association as trustee and collateral agent for the senior secured notes is represented by David McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter & Hampton LLP. BDO Consulting is the financial advisor for U.S. Bank. Lenders led by Wilmington Trust FSB are providing the DIP financing. The DIP Agent is represented by Peter Neckles, Esq. and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York. The Official Committee of Unsecured Creditors has retained Cooley LLP as its counsel. Blockbuster's non-U.S. operations and its domestic and international franchisees, all of which are legally separate entities, were not included in the filings and are not parties to the Chapter 11 proceedings. Bankruptcy Creditors' Service, Inc., publishes BLOCKBUSTER BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Blockbuster Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) BLOCKBUSTER INC: Proposes Deloitte as Valuation Advisor ------------------------------------------------------- Blockbuster Inc. and its units seek the Bankruptcy Court's authority to employ Deloitte Financial Advisory Services LLP as their valuation services advisor, nunc pro tunc to November 10, 2010, pursuant to an engagement letter. The Debtors previously sought and obtained the Court's permission to employ Deloitte Tax LLP, a separate, but affiliated, legal entity from Deloitte FAS, as their tax advisor. Roderick J. McDonald, Esq., Blockbuster Inc.'s vice president, general counsel and secretary, relates that in a separate application, the Debtors are also seeking to employ PricewaterhouseCoopers LLP to perform independent auditing and accounting services. Mr. McDonald assures Judge Lifland that Deloitte FAS' valuation services are not duplicative of the services being provided by Deloitte Tax and PwC. As valuation services advisor, Deloitte FAS will: (a) develop an estimate of the fair value of the business enterprise of the Debtors' reporting units as of the effective date of a plan of reorganization; (b) perform a reconciliation of the aggregate value of the Reporting Units to the overall enterprise value of the Debtors; (c) develop estimates of fair value of the business enterprise of the Debtors' various legal entities as of the Effective Date; and (d) develop an estimate of the fair value of certain assets and liabilities as of the Effective Date for each of the Reporting Units. The assets and liabilities subject to appraisal are anticipated to include: -- Tangible Assets: * Merchandise inventory; * Rental library; * Real property assets; and * Personal property assets; -- Intangible Assets: * Trademarks/trade names; * Movie studio contracts/relationships; * Customer lists/relationships; * Favorable contracts; * Technology patents; and * Employment/non-compete agreements; and -- Liabilities: * Unfavorable leasehold interests; and * Unfavorable contracts. The Debtors will pay Deloitte FAS based on these agreed hourly rates: Personnel Classification Rate ------------------------ ----- Partner, Principal, or Director $550 Senior Manager $475 Manager $425 Senior Associate $325 Associate and Junior Staff $275 Deloitte FAS will also be reimbursed of its necessary expenses. Mr. McDonald informs the Court that Deloitte FAS provided prepetition services to the Debtors, and that the Debtors paid Deloitte FAS approximately $52,000, including certain retainers, in the 90 days prior to the Petition Date. As of the Petition Date, no amounts were remaining with respect to the retainers, and no amounts were outstanding with respect to invoices issued by Deloitte FAS prepetition. Daniel M. Peckham, a principal of Deloitte FAS, assures the Court that his firm does not hold any interest adverse to the Debtors. Hence, Deloitte FAS is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Blockbuster Inc. Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA, BLOKB) -- http://www.blockbuster.com/-- is a global provider of rental and retail movie and game entertainment. It has a library of more than 125,000 movie and game titles. Blockbuster said it had assets of $1,017,035,832 and debts of $1,464,939,759 as of August 1, 2010. Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan on September 23, 2010 (Bankr. S.D.N.Y. Case No. 10-14997). Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Alvarez & Marsal is the restructuring advisor with A&M managing director Jeffery J. Stegenga as chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. A steering group of senior secured noteholders is represented by James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin LLP. U.S. Bank National Association as trustee and collateral agent for the senior secured notes is represented by David McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter & Hampton LLP. BDO Consulting is the financial advisor for U.S. Bank. Lenders led by Wilmington Trust FSB are providing the DIP financing. The DIP Agent is represented by Peter Neckles, Esq. and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York. The Official Committee of Unsecured Creditors has retained Cooley LLP as its counsel. Blockbuster's non-U.S. operations and its domestic and international franchisees, all of which are legally separate entities, were not included in the filings and are not parties to the Chapter 11 proceedings. Bankruptcy Creditors' Service, Inc., publishes BLOCKBUSTER BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Blockbuster Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000) BLUEGREEN CORP: Two Directors Elected by Shareholders ----------------------------------------------------- Bluegreen Corporation's shareholders elected Alan B. Levan, Lawrence A. Cirillo and Mark A. Nerenhausen to serve as directors of the Company, and ratified the appointment of Ernst & Young LLP as independent registered public accounting firm. About Bluegreen Corp. Bluegreen Corporation -- http://www.bluegreencorp.com/-- is a provider of places to live and play through its resorts and residential community businesses. The company is organized into two divisions: Bluegreen Resorts and Bluegreen Communities. Bluegreen Resorts acquires, develops and markets vacation ownership interests (VOIs) in resorts located in drive-to vacation destinations and provides various services to third- party resort owners. Bluegreen Communities acquires, develops and subdivides property and markets residential land homesites, which are sold directly to retail customers who seek to build a home in a residential setting, in some cases on properties featuring a golf course and related amenities, and also offers real estate consulting and other services to third parties. It also generates income from its resort management business and through interest income earned from the financing of individual purchasers of VOIs, and homesites sold by Bluegreen Communities. The Company's balance sheet at Sept. 30, 2010, showed $1.13 billion in total assets, $708.04 million in total liabilities, and $423.22 million in stockholders' equity. Bluegreen Corp. has a 'CCC' corporate credit rating, with positive outlook, from Standard & Poor's Ratings Services. BLUEGREEN CORP: S&P Raises Corporate Credit Rating to 'B-' ---------------------------------------------------------- Standard & Poor's Rating Services raised its corporate credit rating on Bluegreen Corp to 'B-' from 'CCC'. S&P's rating outlook on the company is stable. S&P's upgrade on Bluegreen reflects the completion of a $108 million term securitization of timeshare receivables, which reestablished the company's access to this important source of financing after a more than two-year absence. The completion of the securitization and use of proceeds to repay all outstanding balances under the company's Branch Banking & Trust warehouse facility has created, along with $86 million in unrestricted cash balances at September 2010, an adequate level of near term liquidity for Bluegreen, in S&P's view. The transaction also demonstrated the company's ability to generate a pool of receivables of sufficient credit quality to sell into term securitization markets. Over the intermediate term, S&P believes Bluegreen can achieve an adequate and more diversified level of intermediate financing facilities. The company also successfully extended the revolving advance period on the BB&T facility until December 2011 with a revolving limit up to $75 million (up from the originally contemplated $50 million but down from a previous commitment of $125 million). The completion of the term securitization, extension of the BB&T revolving period, as well as the recent issuance of a $20 million timeshare receivables facility with the National Bank of Arizona, coupled with a significant cash balance, suggest, in S&P's view, that the company will have sufficient liquidity in place to fund current sales levels through at least the end of 2011. Bluegreen may also extend its facility led by Liberty Bank for a two-year period and is pursuing an additional lending facility totaling $20 million. Regaining access to term securitization markets is a key rating factor for Bluegreen (and all timeshare operators), as this source of financing provides long-term operating liquidity that enables the company to finance its customers' purchases of timeshare interests. In the nine months ended September 2010, Bluegreen's timeshare sales (before additional loan losses in excess of uncollectible accounts) decreased 8%. S&P estimates that sales of Bluegreen vacation ownership interests will decrease in the mid-single digit percentage area in 2010 and will be flat in 2011. Furthermore, S&P expects Bluegreen to continue to pursue third-party timeshare sales for a commission. S&P believes that Bluegreen will grow its fee-based sales commission revenue from $20 million in 2009 to an estimated $50 million in 2010. At this time, S&P expects that Bluegreen may be able to generate at least the same amount of commission based revenue in 2011. However, it is S&P's view that the depth of the third-party referral base remains uncertain given the short track record of the program. While the increase in fee- based revenue allowed Bluegreen to expand the level of sales that do not require financing, S&P believes that the company will likely remain heavily reliant on its lines of credit, receivable- backed warehousing facilities, and access to the timeshare securitization markets to fund timeshare sales. S&P believes that significant current cash balances provide some cushion if 2011 operating performance is worse than S&P expects. Credit metrics as of September 2010 are weak: Total debt to EBITDA is more than 11x and adjusted EBITDA coverage of interest expense is 1.2x. S&P adjust its measure of debt to include operating leases. Total adjusted debt was $902 million at September 2010 and includes $350 million of securitized debt. The securitized obligations, which, starting in 2010, are recorded on the balance sheet, have historically been included in S&P's adjusted debt measure. Incorporating the closing of the timeshare securitization, availability under the BB&T facility, S&P's expectation for flat timeshare sales and third-party VOI sales for a fee, and moderate debt repayment (which will be mostly related to amortization of receivables-backed facilities and term securitizations), S&P expects leverage and interest coverage to improve to the low-8x area and mid-1x area, respectively, in 2011, which is adequate for the rating. In S&P's view, Bluegreen currently has adequate sources of liquidity to cover its needs over the next 12-18 months mainly due to the successful closing of a timeshare securitization transaction. S&P's assessment of Bluegreen's liquidity profile includes the following expectations and assumptions: S&P believes the company reestablished access to the timeshare securitization market, which, in its view, is the key credit factor for Bluegreen's liquidity profile. S&P believes Bluegreen will be able to extend existing lending facilities or potentially add new facilities to diversify its lending base. Debt maturities over the next 12 months are related to expected levels of amortization in securitization and receivable-based facilities, and would likely be funded by the collection of receivables pledged to the facilities. BPP TEXAS: Owners of 22 Hotels Seek Chapter 11 Protection --------------------------------------------------------- BPP Texas, LLC, BPP Illinois, LLC, BPP Illinois, LLC, BPP Iowa, BPP Michigan, LLC, BPP Minnesota, LLC, and BPP Wisconsin, LLC, filed for Chapter 11 protection on December 21 in Sherman, Texas. The Debtors own and operate 22 hotels located in Texas, Illinois, Iowa, Michigan, Minnesota, and Wisconsin. Each of the Hotels underwent significant renovations in 2008 and now operates under a nationally recognized and well respected Wyndham Hotel Group brand. In addition to owning the real property and improvements, the Debtors own the franchise rights to the Hotels. To assist the Debtors with operating the Hotels, the Debtors maintain contracts with outside, non-debtor companies to assist with the day-to-day some of the more sophisticated aspects of managing the Debtors' assets. "Since their initial purchase, the Hotels have operated successfully (with performance improving drastically as compared to their competitive sets), and the Debtors have generally remained current on their obligations. However, the deep recession, the tightening of global credit markets, and a downturn in the hospitality industry as whole have affected the Debtors' recent financial performance," counsel to the Debtors, Davor Rukavina, Esq., at Munsch Hardt Kopf & Harr, P.C., in Dallas, Texas, relates. "Additionally, the Debtors' primary secured lender, Citizens Bank of Pennsylvania, has alleged that the Debtors are in default of their obligations to Citizens, has accelerated said obligations, and has refused to restructure the terms of those obligations. Citizens initiated multiple state court proceedings against the Debtors, pursuant to which Citizens sought to appoint a receiver, seize the Debtors' operating cash, and foreclose on the Hotels. Citizens' actions threatened to destroy the Debtors' operations and limit recoveries for all other creditors. "This, combined with the Debtors' inability to refinance their obligations, forced the Debtors to seek Chapter 11 bankruptcy protections in order to restructure their debts, reorganize their businesses, preserve going concerns, and maximize returns for all creditors," Mr. Rukavina relates. The Debtors have requested that the bankruptcy cases be jointly administered under the case styled In re BPP Texas, LLC, et al., Case No. 10-44378 (Bankr. E.D. Texas). BPP TEXAS: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: BPP Texas, LLC c/o FFC Capital Corporation 625 Liberty Avenue, Suite 3110 Pittsburgh, PA 15222 Bankruptcy Case No.: 10-44378 Debtor-affiliates that filed separate Chapter 11 petitions: Debtor Case No. ------ -------- BPP Wisconsin, LLC 10-44379 BPP Michigan, LLC 10-44380 BPP Minnesota, LLC 10-44381 BPP Illinois, LLC 10-44382 BPP Iowa, LLC 10-44383 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Eastern District of Texas (Sherman) Judge: Brenda T. Rhoades Debtor's Counsel: Davor Rukavina, Esq. Jonathan Lindley Howell, Esq. MUNSCH HARDT KOPF & HARR, P.C. 3800 Lincoln Plaza 500 N. Akard Street Dallas, TX 75201 Tel: (214)855-7500 Fax: (214)855-7584 E-mail: drukavina@munsch.com jhowell@munsch.com Estimated Assets & Debts (In millions): Assets Debts ------ ----- BPP Texas $1 to $10 $50 to $100 BPP Wisconsin $10 to $50 $50 to $100 The petitions were signed by Fred Branovan, president. BPP Texas' List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ FFC Capital Corporation Asset Management $14,883 625 Liberty Avenue, Suite 3110 Fees Pittsburgh, PA 15222 Howard Johnson International, Inc. Franchise Fees $3,488 15013 Collections Center Drive Chicago, IL 60693 HD Supply Facilities Maintenance, Trade Debt $3,048 Ltd. P.O. Box 509058 San Diego, CA 92150-9058 U.S. Foodservice, Inc. Trade Debt $2,854 Days Inn Worldwide, Inc. Franchise Fees $2,607 Air Force Heating & Conditioning Trade Debt $2,391 Janus Hotel Management Services, Management Agreement $2,357 LLC American Hotel Register Company Trade Debt $1,747 Tantus Networks Trade Debt $1,562 Ecolab Trade Debt $1,467 Langston's Paint/Handyman Trade Debt $1,347 World Cinema, Inc. Trade Debt $1,165 Guest Supply, Inc. Trade Debt $1,154 Time Warner Cable Trade Debt $1,136 SimplexGrinnell Trade Debt $980 ABC Pest and Lawn Services Trade Debt $935 All Star Carpet Cleaning Trade Debt $747 Sign-a-Rama Trade Debt $644 Travel Media Group Trade Debt $541 CenturyLink Trade Debt $521 BPP Wisconsin's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ FFC Capital Corporation Asset Management $33,358 625 Liberty Avenue, #3110 Fees Pittsburgh, PA 15222 U.S. Foodservice, Inc. Trade Debt $26,520 P.O. Box 98420 Chicago, IL 60693-8420 WE Energies Trade Debt $18,921 P.O. Box 2089 Milwaukee, WI 53201-2089 Days Inn Worldwide, Inc. Franchise Fees $14,132 Super 8 Worldwide, Inc. Franchise Fees $12,028 Grand Chute Utilities Utilities $10,522 Interstate Management Company, LLC Management Fees $10,032 Wauwatosa Water Utility Utilities $9,752 Citizens Bank of Mukwonago Trade Debt $9,531 World Cinema, Inc. Trade Debt $8,791 HD Supply Facilities Maintenance, Trade Debt $8,687 Ltd. Sky Telnet, Inc. Trade Debt $8,337 Baymont Franchise Systems, Inc. Franchise Fees $8,333 Travelodge Hotels, Inc. Franchise Fees $7,617 Janus Hotel Management Services, Management Fees $6,077 LLC Howard Johnson International, Inc. Franchise Fees $5,870 Glendale Water Utility Utilities - Water $5,586 J. R. Plumbing, Inc. Trade Debt $4,708 Guest Supply, Inc. Trade Debt $4,708 Tantus Networks Trade Debt $4,531 BRIDGEWATER CONDOMINIUMS: Case Summary & 2 Largest Unsec Creditors ------------------------------------------------------------------ Debtor: Bridgewater Condominiums, LLC 1274 49th St., Suite 272 Brooklyn, NY 11219 Bankruptcy Case No.: 10-51817 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Elizabeth S. Stong Debtor's Counsel: David Carlebach, Esq. 40 Exchange Place, Suite 1306 New York, NY 10005 Tel: (212) 785-3041 Fax: (212) 785-3618 E-mail: david@carlebachlaw.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 two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nyeb10-51817.pdf The petition was signed by Benzion Stiel, managing member. CAESARS ENTERTAINMENT: Deregisters Non-Voting Shares for Plan ------------------------------------------------------------- Caesars Entertainment Corporation filed with the Securities and Exchange Commission on December 13, 2010, a post-effective amendment to a Form S-8 Registration Statement to deregister securities originally registered on April 28, 2008. The registration relates to the offering of shares of the Company's non-voting common stock pursuant to the Harrah's Entertainment, Inc. Management Equity Incentive Plan. A total of 3,733,835 shares of Non-Voting Common Stock were initially registered for issuance under the Registration Statement. On November 23, 2010, the Company completed a reclassification of its securities such that the Non-Voting Common Stock converted on a one-for-one basis into shares of voting common stock. As a result of the reclassification, the Company will be delivering shares of Voting Common Stock pursuant to the Plan and will no longer be delivering shares of Non-Voting Common Stock. The purpose of the Post-Effective Amendment No. 1 to Form S-8 Registration Statement is to deregister 3,733,835 shares of Non- Voting Common Stock that have been or may be sold pursuant to the Plan. About Caesars Entertainment Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. -- http://www.caesars.com/-- is one of the world's largest casino companies, with annual revenue of $4.2 billion, 20 properties on three continents, more than 25,000 hotel rooms, two million square feet of casino space and 50,000 employees. Caesars casino resorts operate under the Caesars, Bally's, Flamingo, Grand Casinos, Hilton and Paris brand names. The Company has its corporate headquarters in Las Vegas. Caesars Entertainment was acquired by investment funds managed by Apollo Management, L.P and affiliates of TPG Capital, L.P in 2008. Hamlet Holdings LLC, an entity formed by Apollo and TPG, holds a 89.3% equity stake in Caesars. In 2008, Caesars Entertainment was acquired by investment funds managed by Apollo Management, L.P and affiliates of TPG Capital, L.P (collectively "Sponsors"). Apollo and TPC entered into an irrevocable proxy vesting voting and dispositive control in Hamlet Holdings. Harrah's announced its re-branding to Caesar's on mid-November 2010. Harrah's carries 'Caa3' long term corporate family and probability of default ratings, with 'positive' outlook, from Moody's Investors Service. It has a 'B-' issuer credit rating, with 'stable' outlook, from Standard & Poor's. Caesars Entertainment Inc. carries a 'Ca' long term rating from Moody's. CAESARS ENTERTAINMENT: Registers 4.577MM Shares for Incentive Plan ------------------------------------------------------------------ In a Form S-8 filing with the Securities and Exchange Commission on December 13, 2010, Caesars Entertainment Corporation said it is offering up to 4,566,919 shares of common stock, $0.01 par value per share under the Harrah's Entertainment, Inc. Management Equity Incentive Plan. The Registration Statement covers, in addition to the number of shares of Caesars Entertainment Corporation, a Delaware corporation, common stock, par value $0.01 per share, stated above, options and other rights to purchase or acquire the shares of Common Stock covered by this Registration Statement and, pursuant to Rule 416 under the Securities Act of 1933, as amended, an additional indeterminate number of shares, options and rights that may be offered or issued pursuant to the Harrah's Entertainment, Inc. Management Equity Incentive Plan, adopted February 27, 2008 as a result of one or more adjustments under the Plan to prevent dilution resulting from one or more stock splits, stock dividends or similar transactions. A copy of the prospectus is available for free at: http://ResearchArchives.com/t/s?714c About Caesars Entertainment Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. -- http://www.caesars.com/-- is one of the world's largest casino companies, with annual revenue of $4.2 billion, 20 properties on three continents, more than 25,000 hotel rooms, two million square feet of casino space and 50,000 employees. Caesars casino resorts operate under the Caesars, Bally's, Flamingo, Grand Casinos, Hilton and Paris brand names. The Company has its corporate headquarters in Las Vegas. Harrah's announced its re-branding to Caesar's on mid-November 2010. Harrah's carries 'Caa3' long term corporate family and probability of default ratings, with 'positive' outlook, from Moody's Investors Service. It has a 'B-' issuer credit rating, with 'stable' outlook, from Standard & Poor's. Caesars Entertainment Inc. carries a 'Ca' long term rating from Moody's. CAPITAL HOME: Asks for Court Okay to Use Cash Collateral -------------------------------------------------------- Capital Home Sales, LLC, seeks authority from the U.S. Bankruptcy Court for the Northern District of Illinois to use cash collateral until February 2011. On July 1, 2009, the Debtor and TCF National Bank entered into an Amended and Restated Revolving Credit and Term Loan Agreement. TCF agreed to provide up to an aggregate principal amount of $14 million to the Debtor in revolving and term loans. As of the Petition Date, TCF asserts that the total amount due and owing to TCF was approximately $12,628,884. On May 31, 2009, the Debtor and M.B. Financial Bank, N.A., entered into an Amended, Restated and Consolidated Loan and Security Agreement, to secure an Amended, Restated and Consolidated Revolving Note executed by the Debtor in favor of M.B. in the principal amount of $25 million. As of the Petition Date, M.B. asserts the total amount due and owing to M.B. was approximately $21,566,048. On February 22, 2006, Teal Financial, LLC, an assumed entity of the Debtor, and Village Bank & Trust entered into a Loan and Security Agreement, to secure non-revolving term notes to be advanced in amounts not to exceed $5 million. As of the Petition Date, VBT asserts that the total amount due and owing to VBT was approximately $527,841. On October 24, 2008, the Debtor and Delaware Place Bank entered into a Floorplan Loan and Security Agreement, to secure a floorplan line of credit and the non-revolving term notes to be advanced in amounts not to exceed $5 million. As of the Petition Date, Delaware Place asserts that the total amount due and owing to Delaware was approximately $4,604,224. On June 10, 2008, the Debtor, doing business as Goshawk Financial, and First Chicago Bank & Trust entered into a Revolving Credit Loan and Security Agreement, to secure revolving and term loans to be advanced in amounts not to exceed the principal amount of $10 million. As of the Petition Date, First Chicago asserts that the total amount due and owing to First Chicago was approximately $4,045,502. Gregory K. Stern, Esq., who has an office in Chicago, Illinois, explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at http://bankrupt.com/misc/CAPITAL_HOME_budget.pdf In exchange for using cash collateral, the Debtor proposes to grant TCF National, M.B. Financial, Village Bank, Delaware Place, and First Chicago postpetition replacement liens to the same extent and with the same priority as each held prepetition on all of the Collateral and all postpetition property of the Debtor of the type or kind substantially equivalent to the Collateral. The Debtor will maintain adequate property insurance on the manufactured homes listing TCF National, M.B. Financial, Village Bank, Delaware Place, and First Chicago as a lienholder where applicable. The Debtor asks the Court to set a final hearing for January 18, 2011, at 10:30 a.m. on the Debtor's request to use cash collateral. About Capital Home Portland, Oregon-based Capital Home Sales, LLC -- dba Falcon Financial, LLC; Kestral Financial, LLC; Emerald Financial, LLC; Teal Financial, LLC; Harrier Financial, LLC; Goshawk Financial, LLC; Heron Financial, LLC; Wigeon Financial, LLC; Kestral Onel, LLC; Kestral Rentals; Wigeon Rentals; and Goshawk Rentals -- started as a series of individual companies that performed sales and rental functions for particular manufactured home communities, which communities were often related affiliates of the Company. The Company conducts the foregoing business operation of purchasing, selling, leasing and financing homes. The Company filed for Chapter 11 bankruptcy protection on December 8, 2010 (Bankr. N.D. Ill. Case No. 10-54387). Gregory K. Stern, Esq., at Gregory K. Stern, P.C., serves as the Company's counsel. The Company estimated its assets at $50 million to $100 million and debts at $10 million to $50 million. CASTLEROCK ENTERPRISES: Voluntary Chapter 11 Case Summary --------------------------------------------------------- Debtor: CastleRock Enterprises, LLC 1015 Highway 248, Suite K Branson, MO 65616 Bankruptcy Case No.: 10-63040 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court Western District of Missouri (Springfield) Judge: Arthur B. Federman Debtor's Counsel: Eric A. Farris, Esq. FARRIS & ASSOCIATES P.O. Box 490 Branson, MO 65616 Tel: (417) 334-7278 Fax: (417) 334-7503 E-mail: eric@farrislawgroup.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 Dimitrios Tsahiridis, managing member. CELEBRITY RESORTS: Court Declares Son, Not Father, as Owner ----------------------------------------------------------- Neil S. Meyers, v. Jared M. Meyers, et al., Adv. Pro. No. 10-00178 (Bankr. M.D. Fla.), seeks (i) a declaratory judgment that the Plaintiff is the owner of Celebrity Resorts, LLC, and its affiliates; and (ii) the issuance of an injunction prohibiting son Jared Meyers from exercising control over the Debtors. Judge Arthur B. Briskman denies the request, ruling that the Plaintiff has not carried his burdens. He has not established he is entitled to declaratory relief or to the imposition of an injunction. Plaintiff did not own or control any of the Debtors on the Petition Date. According to Judge Briskman, Jared owned and controlled the Debtors. He was authorized to file bankruptcy petitions for the Debtors. A copy of Judge Briskman's December 17, 2010 Memorandum Opinion and Order is available at http://is.gd/jceRQfrom Leagle.com. Orlando, Florida-based Celebrity Resorts, LLC, and 35 affiliates filed for Chapter 11 bankruptcy protection on March 5, 2010 (Bankr. M.D. Fla. Lead Case No. 10-03550). R. Scott Shuker, Esq., at Latham Shuker Eden & Beaudine LLP, assists the Debtor in its restructuring effort. The Company estimated assets and debts at $10 million to $50 million in its Chapter 11 petition. CENTRAL TEXAS TRAILS: Texas High Ct. Remands Suit Over 2003 Crash ----------------------------------------------------------------- The Supreme Court of Texas affirmed a court of appeals' judgment over damage awards in a lawsuit involving a 2003 bus crash accident, and remanded the matter to trial court for further proceedings. The Texas Supreme Court also issued rulings over federal safety standards. The High Court held that federal safety standards at issue do not preempt state law. The case is MCI Sales and Service, Inc., f/k/a Hausman Bus Sales, Inc., and Motor Coach Industries Mexico, S.A. de C.V., f/k/a Dina Autobuses, S.A. de C.V., v. James Hinton, Individually and as Representative of the Estate of Dolores Hinton, Deceased, et al., No. 09-0048 (Tex. Sup. Ct.). Bus owner and operator Central Texas Trails, Inc., Central Texas Bus Lines, Inc., and Kincannon Enterprises, Inc., filed for Chapter 11 bankruptcy protection shortly after a 2003 bus accident. The bus crash victims filed creditor claims against Central Texas in the bankruptcy court. Central Texas maintained a $5 million liability insurance policy, and the carrier paid the policy limits into the bankruptcy court's registry, creating a liability fund. The bus crash claimants participated in non- binding mediation, the goal of which was to formulate a plan for apportioning the fund. The mediator assigned a percentage of the fund to each claimant, and these percentages were incorporated into a plan submitted to the bankruptcy court for approval, which was given on October 21, 2003. Under the "Apportionment Plan," a claimant could accept the mediator's percentage and immediately receive that portion of the liability fund. If the claimant chose not to accept the mediator's allocation, the claimant participated in a "Litigation Plan." Under this plan, the claimants tried their claims to a special judge agreed to by the participants, and their recovery under this plan was capped at 110% of the mediator's allocation. Further, the parties could agree at any time to approve a full or partial distribution to any or all participants. Central Texas's tort liability in excess of the liability fund was discharged upon approval of its reorganization plan in 2004. On June 26, 2003, a group of the injured bus occupants -- or their estates -- and their relatives filed suit against Motor Coach Industries Mexico, S.A. de C.V., and MCI Sales and Service, Inc., the bus's manufacturer, importer, and distributor, alleging the motorcoach was defectively designed because it lacked passenger seatbelts and laminated-glass windows. MCI attempted to join Central Texas and the bus driver as responsible third parties, but the trial court denied the motion and also refused to submit a question asking the jury if Central Texas and the driver were liable as responsible third parties or as settling parties to determine proportionate liability. Following a jury trial, the jury found for the Plaintiffs, making separate causative findings as to each claim. The jury awarded over $17 million in damages. After the jury's verdict but before entry of judgment, the Plaintiffs, all of whom opted for resolution of their claims against Central Texas via the Litigation Plan, appeared before a special judge. The judge found that the bus driver's negligence proximately caused the accident that produced the Plaintiffs' injuries and that he was acting within the scope of his employment with Central Texas. Further, the judge determined that the jury's damage awards, with one exception, significantly exceeded the 110% maximum recovery under the Litigation Plan. Limiting the one participant's recovery to what the jury awarded, the judge capped the remaining damage awards at the 110% maximum. Because of the limited funds, however, the awards were prorated so that each participant received a relative percentage of the actual award. In the end, each Litigation Plan participant (again, with the one exception) received a sum that is within 2% of the amount allocated by the mediator. The bankruptcy judge approved the special judge's report, and the payments were made. Thereafter, the trial court entered judgment, adjusting the damage awards to account for the funds received under the Litigation Plan. MCI appealed, and the court of appeals reversed and remanded. The court rejected MCI's preemption arguments but agreed that the trial court abused its discretion by not submitting a question to the jury regarding Central Texas and the bus driver's proportionate liability as settling persons. MCI then petitioned the Supreme Court for review of the preemption issues, and the Plaintiffs cross-petitioned for review of the proportionate responsibility issue. A copy of the Texas Supreme Court's opinion dated Dec. 17, 2010, is available at http://is.gd/jddAsfrom Leagle.com. Justice Eva Guzman delivered the opinion of the Court, in which Justice Nathan L. Hecht, Justice Dale Wainwright, Justice David Medina, Justice Phil Johnson, Justice Don R. Willett, and Justice Debra Lehrmann joined, and in which Chief Justice Wallace B. Jefferson joined as to Parts I and II. Chief Justice Jefferson filed an opinion, dissenting in part. Justice Paul W. Green did not participate in the decision. CFC MANAGEMENT: Inability to Refinance Loan Cues Bankruptcy Filing ------------------------------------------------------------------ Nashville, Tennessee-based CFC Management, LLC, doing business as Mad Donna's Restaurant & Lounge, filed for Chapter 11 protection in its hometown on December 16, 2010 (Bankr. M.D. Tenn. Case No. 10-13585). Affiliate CFC Properties, LLC, also filed (Case No. 10-13586). CFC Management estimated $50,000 in assets and $100,000 to $500,000 in debts in its Chapter 11 petition. CFC Properties estimated $500,000 to $1,000,000 in assets and debts. The outstanding debts also included unpaid federal and state taxes. Kristen MacBeth at BankruptcyHome.com reports that one of the main reasons for the filing was not a lack of business related to recession-induced downsizing, but an inability for the owners to secure refinance loans for the property. CFC is now looking for new investors and alternative ways to acquire financing. CFC Management owns Tennessee restaurants Mad Donna's and MD Loft. The Debtors are represented by: Joseph P. Rusnak, Esq. Tune Entrekin & White PC 315 Deaderick Street, Suite 1700 Nashville, TN 37238-1700 Tel: (615) 244-2770 Fax: (615) 244-2778 E-mail: jrusnak@tewlawfirm.com CLAIM JUMPER: Gift Card Holders to get Money Back ------------------------------------------------- Bethany Clough at The Fresno Bee reports Landry's Restaurant Inc., the parent company of Claim Jumper, said holders of Claim Jumper gift cards are going to get their money back. Customers can have a check mailed to them, or exchange their card for one that is good at any of the 200 restaurants owned by Landry's. About Claim Jumper Irvine, California-based Claim Jumper Restaurants, LLC -- http://www.claimjumper.com/-- operates a chain of casual dining restaurants. It was founded in 1977. It has locations in Arizona, California, Colorado, Illinois, Nevada, Oregon, Washington, and Wisconsin. Claim Jumper filed for Chapter 11 bankruptcy protection on September 10, 2010 (Bankr. D. Del. Case No. 10-12819). The Debtor estimated its assets at $50 million to $100 million and debts at $100 million to $500 million as of the Petition Date. The Debtor's affiliate, Claim Jumper Management, LLC, filed a separate Chapter 11 petition (Bankr. D. Del. Case No. 10-12820). Curtis A. Hehn, Esq., James E. O'Neill, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, are the Debtors' local counsel. Milbank, Tweed, Hadley & Mccloy LLP is the Debtors' general bankruptcy counsel. Piper Jaffray & Co. is the Debtors' financial advisors and investment bankers. Kurtzman Carson Consultants LLC is the Debtors' notice, claims and solicitation agent. The Creditors Committee has selected the law firms of Cooley LLP and Klehr Harrison Harvey Branzburg LLP as counsel. In December 2010, Claim Jumper completed the sale its business to Landry's Restaurants Inc., in a transaction valued at $76.6 million. Landry's outbid the offer of holders of mezzanine debt with a winning bid that included $48.3 million cash, the assumption of $23.3 million in debt, and $5 million cash to collateralize existing letters of credit. CLIFFS AT INDIAN: Case Summary & Largest Unsecured Creditor ----------------------------------------------------------- Debtor: Cliffs at Indian Pointe, LLC nka Premiere Properties of the Ozarks, LLC 422 Burk Road Highlandville, MO 65669 Bankruptcy Case No.: 10-63044 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court Western District of Missouri (Springfield) Judge: Arthur B. Federman Debtor's Counsel: Raymond I. Plaster, Esq. RAYMOND I. PLASTER, P.C. 2032 E. Kearney, Ste. 107 Springfield, MO 65803 Tel: (417) 831-6900 Fax: (417) 831-6901 E-mail: riplaster@rip-pc.com Scheduled Assets: $5,500,000 Scheduled Debts: $7,723,954 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Great Southern Deed of Trust $10,000 P. O. Box 68 Springfield, MO 65801-0068 The petition was signed by Karen O. Woolard, managing member. CNO FINANCIAL: Moody's Upgrades Ratings on Senior Loan to B1' ------------------------------------------------------------- Moody's Investors Service has upgraded the ratings of CNO Financial Group's senior secured credit facility and senior secured notes to B1 from B2 and its senior unsecured convertible debentures to B2 from Caa1. The rating outlook for CNO and its subsidiaries is stable. This rating action concludes the review for possible upgrade that was initiated on November 30, 2010. Ratings Rationale Moody's Vice President and Senior Credit Officer, Ann Perry, said: "The upgrade of CNO's debt follows the successful refinancing of the company's bank debt, which reflects improvement in the company's capital structure, particularly a better laddering of debt maturities". CNO issued a $375 million senior secured amortizing term loan with a final maturity of September 2016 and a new pari-passu issuance of $275 million of senior secured notes with a final maturity of January 2018, and used the proceeds of these issuances, along with cash held at the holding company, to refinance the existing $652 million of senior secured bank debt. The B2 rating on the senior convertible debentures has been upgraded by two notches to one notch below the senior secured debt ratings. This notching difference reflects its more junior ranking in the capital structure as unsecured versus secured debt, and incorporates Moody's normal notching practice. Moody's commented that the amortization of the new senior secured credit facility, extension of the debt maturities, and repayment of a portion of the existing bank debt from holding company cash included in the refinancing represent progress for CNO in addressing its constrained capital structure. However, the company's credit profile is still challenged by modest financial flexibility and historically low profitability with recurring, albeit reduced and less frequent, "one-time" charges. CNO's ratings also reflect the challenges that it will face in improving its sales and market presence, maintaining the strength of its agency force, and repricing its book of long term care insurance. On the positive side, the rating agency noted CNO's more recent consistent statutory earnings and signs of improvement in its capacity for internal capital generation at the life insurance operating companies. In addition, there has been improvement in CNO's statutory and GAAP earnings in 2010, stronger holding company liquidity, and progress made in remediating internal controls and risk management weaknesses. According to Moody's, these could put upward pressure on CNO's IFS ratings: sustained annual run-rate consolidated statutory EBIT of at least $150 million (net after the negative impact on earnings of fees paid to the holding company and investment losses); a sustained NAIC RBC ratio on a consolidated basis consistently above 300%; and investment losses of less than $50 million for 2011. Conversely, downward pressure could result from these: financial flexibility constrained by tight credit facility covenants; adjusted GAAP EBIT coverage of below two and a half times; an NAIC RBC ratio of any statutory operating entity below 200%, or an NAIC RBC ratio of a statutory entity actively marketing insurance products below 275%. CNO Financial Group is a specialized financial services holding company that operates primarily in the life and health insurance sectors through its subsidiaries. As of September 30, 2010, CNO, which is headquartered in Carmel, Indiana, reported total assets of $32 billion and shareholders' equity of $4.6 billion. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to pay punctually senior policyholder claims and obligations. CNO FINANCIAL: S&P Raises Counterparty Credit Rating to 'B' ----------------------------------------------------------- Standard & Poor's Ratings Services said that it raised its counterparty credit rating on CNO Financial Inc. to 'B' from 'B-' and its counterparty credit and financial strength ratings on CNO Financial's operating companies to 'BB' from 'BB-'. Standard & Poor's also said that it removed all of these ratings from CreditWatch, where they were placed on Nov. 30, 2010, with positive implications. The outlook on all these companies is stable. "The ratings on CNO Financial reflect the company's significantly improved financial flexibility in the past year," noted Standard & Poor's credit analyst Kevin G. Maher. "This improvement stemmed from extending the maturities of its credit facility by several years, an equity offering, renegotiated covenants of the senior credit agreement, and a convertible debt restructuring in October 2009." These actions have provided a modest cushion above bank covenants on the senior credit agreement; capital and earnings are the key covenants that could be pressured. S&P believes that the fundamentals of the operating companies should support the growth of capital and provide a cushion above the covenants over the next several years, absent any further significant investment losses or unexpected deterioration to the good operating performance. The primary sources of cash at the holding company are dividends from the operating companies, interest on surplus debentures, and management and investment fees. The holding company continues to rely on its operating companies to improve risk-adjusted capitalization to stay within covenants, which in turn compels the operating companies to minimize dividends. The outlook is stable. The rating anticipates that CNO Financial will maintain and widen the cushion above its bank covenants. The size of the cushion in GAAP interest coverage improved modestly with reduction of some higher interest debt. S&P expects GAAP interest coverage to remain at or above 3x. The refinancing of the credit facility extends the maturities to 2016 and 2018 from 2013, which reduces near-term pressure. However, CNO Financial will continue to have modest financial flexibility because of limitations on dividends from the operating companies. S&P expects earnings, capital, and financial flexibility to continue to improve modestly in 2011, though significant investment write-downs or a deterioration in the insurance subsidiaries' operating performance could cause the company to breach its covenants. If GAAP operating earnings decline below $120 million for 2011 or if financial flexibility decreases, S&P would likely lower all of the ratings. COLOR ALL: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Color All Technologies International Inc. 3902 Flatiron Loop, #102 Wesley Chapel, FL 33544 Bankruptcy Case No.: 10-48452 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Southern District of Florida (West Palm Beach) Debtor's Counsel: Bradley S. Shraiberg, Esq. SHRAIBERG, FERRARA & LANDAU P.A. 2385 NW Executive Center Drive, #300 Boca Raton, FL 33431 Tel: (561) 443-0801 Fax: (561) 998-0047 E-mail: bshraiberg@sfl-pa.com Scheduled Assets: $379,449 Scheduled Debts: $4,485,229 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flsb10-48452.pdf The petition was signed by Ezra Beard, president & CEO. COLUMBIAN CHEMICALS: S&P Assigns 'BB-' Corporate Credit Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned a 'BB-' corporate credit rating to Marietta, Georgia-based Columbian Chemicals Acquisition LLC. The outlook is stable. At the same time, S&P assigned its 'BB' issue-level ratings (one notch above the corporate credit rating) to Columbian Chemicals' $375 million senior secured credit facilities due 2015. The recovery ratings are '2', indicating S&P's expectation of substantial recovery (70%-90%) in the event of a payment default. The company used the proceeds primarily to refinance its existing debt and extend debt maturities, with a portion of the funds allocated for fees and expenses. The senior facilities consist of a $75 million revolving credit facility and a $300 million term loan A. "The ratings on Columbian Chemicals reflect the company's aggressive financial risk profile as well as its fair business risk profile," said Standard & Poor's credit analyst Ket Gondha. Although Columbian Chemicals is the world's third-largest manufacturer of carbon black, it has a narrow product focus, and substantial customer and end-market concentration related to sales to the automotive industry. In addition, the company is exposed to raw material price volatility, though it can typically pass through cost increases with a moderate time lag. CONAGRA FOODS: Fitch Says Outlook Cuts Cue Increased Concern ------------------------------------------------------------ Repeated cuts to the fiscal 2011 outlook of Conagra Foods, Inc., have a resulted in increased credit default swap market concern about the health of the company, according to Fitch Solutions in its latest earnings commentary. With Conagra's CDS spreads widening 96% over the last three months, 'credit markets have continued to price in increasing default risk for Conagra,' said Author and Managing Director Jonathan Di Giambattista. Meanwhile, market uncertainty over the food maker's future performance appears to have diminished as Conagra's CDS liquidity moved from trading in the 20th regional percentile to the 30th. Elsewhere, CDS on Commercial Metals Company have tightened 8% over the last three months. The CDS Implied Rating for CMC has fallen two notches in 2010 to 'BB-'. 'Spot spreads are placing CMC's credit risk at a 'B+' level,' said Di Giambattista. Conagra Foods, Inc. (CONSUMER GOODS/Food Producers) Credit spreads have widened over the last three months, with the five-year point widening from 49 basis points (bps) to 96 bps, an increase of 96%. The liquidity score on Conagra Foods, Inc. increased from 7.84 to 7.99 over the three-month period, causing a decrease in liquidity from trading in the 20th percentile to the 30th percentile. Commercial Metals Company (BASIC MATERIALS/Industrial Metals) Credit spreads have tightened over the last three months, with the five-year point tightening from 399 bps to 377 bps, a decrease of 5.5%. The liquidity score on Commercial Metals Company decreased from 8.10 to 7.91 over the three-month period, causing an increase in liquidity from trading in the 31st percentile to the 27th percentile. Navistar International Corporation (INDUSTRIALS/Industrial Engineering) Credit spreads have tightened over the last three months, with the five-year point tightening from 388 bps to 327 bps, a decrease of -16%. The liquidity score on Navistar International Corporation increased from 8.12 to 8.37 over the three-month period, causing a decrease in liquidity from trading in the 31st percentile to the 42nd percentile. Nike Inc. (CONSUMER GOODS/Personal Goods) Credit spreads have tightened over the last three months, with the five-year point tightening from 51 bps to 49 bps, a decrease of - 4%. The liquidity score on Nike Inc. increased from 8.71 to 8.84 over the three-month period, causing a decrease in liquidity from trading in the 47th percentile to the 53rd percentile. Hovnanian Enterprises, Inc. (CONSUMER GOODS/Household Goods) Credit spreads have tightened over the last three months, with the five-year point tightening from 1658 bps to 1487 bps, a decrease of -10%. The liquidity score on Hovnanian Enterprises, Inc. decreased from 7.82 to 7.71 over the three-month period. The regional percentile ranking stayed the same CONNACHER OIL: Moody's Gives Stable Outlook, Keeps 'Caa1' Rating ---------------------------------------------------------------- Moody's Investors Service changed Connacher Oil & Gas Limited's outlook to stable from negative and affirmed its Caa1 Corporate Family Rating. Moody's also affirmed both the B1 rating on Connacher's US$200 million of first lien notes due July 15, 2014, and the Caa2 rating on the US$587 million of second lien notes due December 2015. Connacher's SGL-3 Speculative Grade Liquidity rating was affirmed. "Connacher's outlook was changed to stable in recognition of the steady ramp-up of Algar over the past several months," said Terry Marshall, Moody's Senior Vice President. "We expect Connacher to produce both higher and more consistent cash flow in 2011 as Algar continues to advance and Pod 1 stabilizes, enabling the company to produce as much as 14,000 to 15,000 barrels of bitumen per day before royalties in 2011." Downgrades: Issuer: Connacher Oil and Gas Limited -- Senior Secured Regular Bond/Debenture, Downgraded to LGD2, 12% from LGD2, 11% Upgrades: Issuer: Connacher Oil and Gas Limited -- Senior Secured Regular Bond/Debenture, Upgraded to LGD4, 58% from LGD4, 59% Outlook Actions: Issuer: Connacher Oil and Gas Limited -- Outlook, Changed To Stable From Negative Connacher will have a much lower capital spending program in 2011 with Algar and its associated 13 megawatt cogen facility now complete. The anticipated completion of a utility substation in the first half of 2011 should alleviate some of the power outage issues experienced by Connacher in 2010. The Caa1 CFR reflects Connacher's very high leverage and debt service cost, small production base, and a liquidity position that is likely to be periodically dependent on external sources absent high bitumen prices. The CFR is supported by Connacher's current bitumen production of about 13,000 to 14,000 bpd, its large proven and probable reserve base, and its 9,500 barrels per day asphalt refinery. Connacher's SGL-3 Speculative Grade Liquidity rating reflects adequate liquidity over the next twelve to fifteen months. Moody's believe Connacher will need to utilize its revolver from time to over the course of the next 12 months as it funds its capital program and deals with the inherent variability in its bitumen production and in its asphalt refinery. Connacher's US$50 million revolving credit facility (US$45 million available given letter of credit usage) should be adequate for this purpose. Connacher should be in compliance with its financial covenants during this period. The company's assets are pledged under the first lien credit facility and notes, but it does have the ability to sell certain non-core assets, if proceeds are reinvested in the business, as Connacher has indicated it intends to do. Incremental cash from these assets sales may be needed to cover the company's interest and capex in the first half of the 2010. The stable outlook reflects Moody's expectation that Algar and Pod 1 will consistently produce bitumen in the range of 14,000 bpd and that the company's high leverage will decline. The rating could be upgraded if Connacher is able to demonstrate that it will be able to maintain bitumen production in the range of 14,000 to 15,000 bpd, maintain adequate liquidity to readily fund interest and capex, and lower its debt to EBITDA towards the 5x range. The outlook or rating could be lowered if liquidity appears insufficient to meet negative free cash flow or if Debt to EBITDA does not show improvement from current levels. In accordance with Moody's Loss Given Default Methodology the notching of the first lien notes three notches above the CFR at B1 reflects their priority in the capital structure, with only the US$50 million first lien revolver and priority trade receivables ranking prior. The notching of the second lien notes at Caa2, reflects the cushion provided by the C$100 million subordinated convertible notes and regular trade payables. Connacher Oil and Gas Limited, headquartered in Calgary, Alberta, is an oil and gas company with primary focus on the development and production of oil sands. CONVATEC HEALTHCARE: Moody's Assigns B2 Corporate; PR Corrected --------------------------------------------------------------- Moody's Investors Service has made a correction on its press release on ConvaTec Healthcare B S.a.r.l., substituting the last paragraph but one of the Ratings Rationale with these: "The principal methodologies used in rating ConvaTec were "Global Medical Products & Device Industry" published in October 2009 and "Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA" published in June 2009." Moody's also substituted the third paragraph under Regulatory Disclosures wih these: "The rating has been disclosed to the rated entity or its designated agents and issued with no amendment resulting from that disclosure." Moody's assigned a provisional (P)B2 corporate family and a (P)B2 probability of default rating to ConvaTec Healthcare B S.a.r.l. Moody's has also assigned a (P)Ba3 rating to the proposed US$690 million Senior Secured Notes due in 2017, a (P)Ba3 rating to the proposed US$850 million Senior Secured Term Loan B, a (P)Ba3 rating to the proposed US$250 million Senior Secured Revolving Credit Facility and a (P)Caa1 rating to the proposed US$1,180 million Senior Unsecured Notes due in 2018. The outlook on the ratings is positive. This is the first time that Moody's has rated ConvaTec. The ratings are contingent upon ConvaTec's success in placing the proposed notes and completing the planned refinancing of the company's current financing package. In addition to the Senior Secured and Unsecured Notes, the refinancing package also includes a US$850 million Senior Secured Term Loan maturing in 2016 as well as a US$250 million Senior Secured Revolving Credit Facility maturing in 2015. Moody's notes that the company's capital structure also consists of US$2,313 million of mandatorily redeemable preferred equity certificates, which Moody's -- based on the draft terms and conditions related to these instruments -- treats as 100% equity. Moody's issues provisional ratings in advance of the final sale of securities and these reflect Moody's credit opinion regarding the transaction only. Upon a conclusive review of the final documentation, including the documentation relating to the PECs, Moody's will endeavor to assign definitive corporate family and probability of default ratings as well as definitive ratings to the different capital instruments. A definitive rating may differ from a provisional rating. The provisional ratings and the positive outlook assigned to ConvaTec assume a successful refinancing of the company's current financing package as well as the confirmation that the final set of documentation related to the PECs does not differ from the draft documentation and therefore allows these to be treated as 100% equity according to Moody's guidelines. Ratings Rationale The B2 rating is a reflection of the company's high leverage after the refinancing, which is expected to be at approximately 6.4x Debt/EBITDA (based on LTM adjusted EBITDA as per September 2010 and including Moody's adjustments). While the relatively weak initial credit metrics are a constraining factor on ConvaTec's rating, Moody's also notes the company's leading position in relatively non cyclical, and thus predictable markets, as well as ConvaTec's broad product portfolio and track record of product life-cycle management and innovation, which together with its solid geographic diversification and limited customer concentration partially mitigate the company's high leverage. The positive outlook reflects Moody's expectation that ConvaTec is well positioned to benefit from further growth in its end markets and that it will be able to maintain high levels of profitability and cash flow generation. In addition, the positive outlook assumes that ConvaTec will apply future positive cash flows to the repayment of debt supporting a continued deleveraging, as exemplified by a Debt/EBITDA ratio of 6.0x to be achieved within 12 months. Moody's notes that the positive outlook does not incorporate headroom for major, extraordinary investment activity or acquisitions. With revenues of US$1.5 billion (LTM basis as per September 2010), ConvaTec is a leading player in different medical product and device end markets, namely Ostomy (37% of revenues), Wound Therapeutics (32%), Continence & Critical Care (17%) and Infusion Devices/Industrial Sales (14%). As many of ConvaTec's products are required for non-discretionary medical care, ConvaTec benefits from relatively stable demand levels and thus revenue and cash flow visibility. Overall favorable demographic dynamics as well as increasing demand from emerging markets are expected to support further growth, a trend from which ConvaTec is likely to benefit. Despite overall favorable demand trends, Moody's notes that ConvaTec, as other players in this industry, could be affected by changes in healthcare regulation, e.g. changes to reimbursement rates, which could -- unless offset by cost savings -- put pressure on margins and cash flow generation and consequently limit ConvaTec's ability to reduce its leverage. Following the closing of the proposed refinancing, ConvaTec's leverage is expected to reach approximately 6.4x Debt/EBITDA and a FCF/Debt of approximately 4.0% (adjusted for one-off items relating to recent restructuring measures). As the company intends to apply 50% of its free cash flow to debt repayments, credit metrics are likely to show a deleveraging trend. Convatec's liquidity profile is estimated to be solid after the refinancing. While parts of the company's cash balance will be used to repay existing debt and cover costs relating to the refinancing, Convatec's cash position is expected to amount to approximately US$38 million after the closing. The company also benefits from a US$ 250 million Revolving Credit Facility which will be undrawn at closing. This facility will mature in 2015 and is subject to financial covenants, which are however expected to show a satisfactory headroom upon closing. Moody's expects the company's cash balance and cash flows to be sufficient to cover initially limited debt repayments, as well as further cash outflows relating to, for example, working capital or capital expenditures. ConvaTec's financing package will consist of a US$850 million Senior Secured Term Loan, a US$250 million Senior Secured Revolving Credit Facility as well as US$690 million Senior Secured Notes, which will benefit from guarantees of group entities representing at least 85% of consolidated assets and EBITDA. The US$1,180 million Senior Unsecured Notes will benefit from the same, pari-passu ranking guarantees as the secured debt instruments. The secured debt instruments will additionally benefit from first priority pledges over the majority of the group's assets, supporting the (P)Ba3 rating of the US$690 million Senior Secured Notes (LGD2, 28%), while the US$1,180 million Senior Unsecured Notes carry a (P)Caa1 rating (LGD5, 83%). The company's PECs are, based on the draft documentation provided to Moody's, treated as 100% equity. Assignments: Issuer: ConvaTec Healthcare B S.a.r.l. -- Probability of Default Rating, Assigned (P)B2 -- Corporate Family Rating, Assigned (P)B2 Issuer: ConvaTec Healthcare E S.A. -- Senior Secured Regular Bond/Debenture, Assigned (P)Ba3 (LGD2, 28%) -- Senior Unsecured Regular Bond/Debenture, Assigned (P)Caa1 (LGD5, 83%) -- Senior Unsecured Regular Bond/Debenture, Assigned (P)Caa1 (LGD5, 83%) -- Senior Secured Bank Credit Facility, Assigned (P)Ba3 (LGD2, 28%) Issuer: ConvaTec Inc. -- Senior Secured Bank Credit Facility, Assigned (P)Ba3 (LGD2, 28%) An upgrade of the corporate family rating to B1 could be considered if ConvaTec's is able to reduce its leverage to a level of 6.0x after 12 months after closing, which Moody's would expect to trend sustainably towards 5.5x after 18 months. At the same time, ConvaTec's FCF/debt should be trending towards 5% and EBITDA Margin should remain in the high twenties. Moody's would consider to stabilize the outlook on the B2 rating if ConvaTec would fail to reduce its leverage to 6.0x within 12 months after the closing, due, for example, to pressure on profitability levels or the use of cash flows for major growth investments which would hinder the reduction of debt. ConvaTec is a leading developer, manufacturer and marketer of innovative medical technologies, in particular products for ostomy management, advanced chronic and acute wound care, continence care, sterile single-use medical devices for hospitals and infusion sets used in diabetes treatment infusion devices. For the last twelve months ending September 2010, ConvaTec reported revenues of US$1.5 billion and an adjusted EBITDA of US$435 million. Founded in 1978 as a division of Bristol-Myers Squibb, ConvaTec was acquired by private equity sponsors Nordic Capital and Avista Capital Partners in 2008. CONVERGYS CORPORATION: Moody's Affirms 'Ba1' Corp. Family Rating ---------------------------------------------------------------- Moody's Investors Service affirmed the Ba1 corporate family rating for Convergys Corporation and revised the rating outlook to stable from negative. Concurrently, Moody's upgraded the speculative- grade liquidity rating to SGL-1 from SGL-2. The outlook revision reflects the stabilization of the company's operating performance and Moody's expectation that the core Customer Management segment will achieve slight revenue growth and improved profitability in 2011. With the sale of the Human Resources (HR) Management business, which was substantially completed in June 2010, the uncertainties surrounding implementation obligations were eliminated. Without the cash drain of the HR business, the company has managed to restore free cash flow to levels more consistent with the past. While revenue growth and margins of the customer care business remains challenged, Moody's believes that the company can manage its remaining cost structure to ensure annual free cash flow in excess of $150 million regardless of the pace of economic recovery. The SGL-1 liquidity rating indicates very good liquidity for the company. The improvement in liquidity arises from the full repayment of the $400 million revolving credit facility, which was fully drawn as of December 31, 2009. While the maturity of the facility is October 2011, Moody's expects the company will renew a sizable portion of the revolver. Convergys' Ba1 corporate family rating reflects the company's leading customer care market share and low financial leverage. The core customer care business has proven fairly resilient to economic cycles as clients place a higher priority on customer retention in the midst of cost reduction initiatives. The rating is constrained by the company's high customer concentration (e.g., top three clients account for over one-third of revenues) and increasing service line concentration to the lower margin call center outsourcing business following the sale of the HR business and deterioration of the Information Management segment, which has yet to recover from the loss of higher margin AT&T and Sprint revenues. Over the long term, Moody's believes growth opportunities remain healthy as companies continue to outsource their customer care functions; however, in the near term, Moody's expects organic growth to be limited by a slowly recovering economy. Ratings affirmed: * Corporate Family Rating -- Ba1 * Probability of Default Rating -- Ba1 * Senior unsecured shelf rating at (P)Ba1 (LGD 3, 44%) * Preferred shelf rating at (P)Ba2 (LGD 6, 97%) Rating upgraded: * Speculative Grade Liquidity Rating -- SGL-1 from SGL-2 Moody's most recent rating action was on May 14, 2009, when Moody's confirmed Convergys' Ba1 rating and changed the rating outlook to negative following a review period. Convergys Corporation, headquartered in Cincinnati, Ohio, provides outsourced customer care, telecommunications and cable billing services. CORT JONES: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Joint Debtors: Cort R. Jones Lisa D. Jones dba Cort's Mobile Homes 16611 N. IL Highway 37 Mount Vernon, IL 62864 Bankruptcy Case No.: 10-41897 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Southern District of Illinois (Benton) Judge: Laura K. Grandy Debtors' Counsel: Michael E. Reed, Esq. P.O. Box 1885 310 S. Elm Street Centralia, IL 62801 Tel: (618) 533-0122 Fax: (618) 533-7541 E-mail: reedlaw1885@gmail.com Estimated Assets: $1,045,750 Estimated Debts: $2,479,451 A list of the Joint Debtors' 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ilsb10-41897.pdf CRYSTAL CATHEDRAL: Examiner Charged With Probing Compensation ------------------------------------------------------------- Dow Jones' Small Cap reports that Crystal Cathedral Ministries has agreed to have an examiner appointed in its bankruptcy case to delve deeper into insider compensation issues after seeing a federal watchdog and unsecured creditors take aim at its proposed salaries for certain executives. The company, alongside the official committee representing unsecured creditors in the case and the U.S. trustee assigned to the proceedings, have decided that the circumstances of the case are ripe for the addition of an examiner, according to court papers filed earlier with the U.S. Bankruptcy Court in Santa Ana, Calif., Dow Jones' notes. It was agreed that the examiner's budget won't exceed $25,000, according to Bill Rochelle, the bankruptcy columnist for Bloomberg News. The U.S. trustee Tuesday filed an application with the court for the appointment of Christopher Barclay, a director with expert services firm LECG LLC, who the U.S. Trustee selected to serve in the role, the report adds. Crystal Cathedral Ministries is a Southern California-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on October 18, 2010. March J. Winthrop, Esq., at Winthrop Couchot Professional Corporation, in Newport Beach, California, represents the Debtor. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. CYNERGY DATA: Judge Approve Chapter 11 Liquidation Plan ------------------------------------------------------- A bankruptcy judge on Tuesday approved Cynergy Data LLC's Chapter 11 liquidation plan, overruling objections from the company's former CEO regarding releases granted to a lender, Bankruptcy Law360 reports. About Cynergy Data Launched in 1995, Cynergy Data was a merchant credit card processing service provider. The Company and two affiliates -- Cynergy Data Holdings, LLC, and Cynergy Prosperity Plus, LLC -- filed for Chapter 11 bankruptcy protection on September 1, 2009 (Bankr. D. Del. Case No. 09-13038). Cynergy Data said that it had assets of $109.5 million against debts of $186.1 million as of June 30, 2009. The Company's legal advisor is Nixon Peabody LLP; its financial and restructuring advisor is CM&D Management Services LLC; its industry expert is Unicorn Partners, LLC; and its investment bankers are Stifel, Nicolaus & Company and Peter J. Solomon Company. The Company also hired Pepper Hamilton LLP as bankruptcy and restructuring counsel. Charles D. Moore of Conway MacKenzie, Inc., serves as chief restructuring officer. Kurtzman Carson & Consultants LLC serves as claims and notice agent. Cynergy Data filed for Chapter 11 to complete the sale of all of its assets to an affiliate of The ComVest Group. The $81 million sale was completed October 2009. The Debtor was renamed to Liquidation Co. LLC following the sale. DAVID DUNNE: Files Schedules of Assets and Liabilities ------------------------------------------------------ David Michael Dunne filed with the U.S. Bankruptcy Court for the Western District of Washington its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $5,921,000 B. Personal Property $22,830,110 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $3,208,190 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $64,586,297 ----------- ----------- TOTAL $28,751,110 $67,794,487 A copy of the schedules is available for free at: http://bankrupt.com/misc/DavidDunne_SAL.pdf Lake Tapps, Washington-based David Michael Dunne, aka D Michael Dunne, and Jo Ann Elizabeth Dunne filed for Chapter 11 bankruptcy protection on July 22, 2010 (Bankr. W.D. Wash. Case No. 10-45981). Timothy W. Dore, Esq., at Ryan Swanson & Cleveland PLLC, assists the Joint Debtors in their restructuring effort. The Debtors estimated assets and debts at $10,000,001 to $50,000,000 as of the Petition Date. DAVROC LLC: Case Summary & 19 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Davroc, LLC dba The Trading Post 314 Kent Road New Milford, CT 06776 Bankruptcy Case No.: 10-53030 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court District of Connecticut (Bridgeport) Judge: Alan H.W. Shiff Debtor's Counsel: Ira B. Charmoy, Esq. ZELDES NEEDLE & COOPER 1000 Lafayette Blvd P.O. Box 1740 Bridgeport, CT 06601 Tel: (203) 333-9441 Fax: (203) 333-1489 E-mail: icharmoy@znclaw.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 19 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ctb10-53030.pdf The petition was signed by David Lord, managing member. DEE RANDALL: Case Summary & 5 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Dee Allen Randall 1376 Golden Circle Drive Kaysville, UT 84037 Bankruptcy Case No.: 10-37546 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court District of Utah (Salt Lake City) Judge: R. Kimball Mosier Debtor's Counsel: Andres Diaz, Esq. 1 ON 1 LEGAL SERVICES 307 West 200 South, Suite 2004 Salt Lake City, UT 84101 Tel: (801) 596-1661 Fax: (801) 359-6803 E-mail: courtmail@adexpresslaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 Debtor's List of five Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Provident Funding Rental Unit 190 $216,459 P.O. Box 5914 Millcreek Santa Rosa, CA 95402 ASC Rental Unit 190 $213,000 P.O. Box 10328 Millcreek Des Moines, IA 50306 C.L.I. Enterprises Remainder of Lease $138,667 Jeffery Fillmore 10 East South Temple, #900 Salt Lake City, UT 84110 American Express Business Credit $39,276 Card Bank of America Credit Card for $29,903 Business DELUXE ICE: Hearing on Key Bank's Cash Use Continued Until Jan. 18 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of California has continued until January 18, 2011, at 10:00 a.m., to consider Matterhorn Group, Inc., et al's request to access cash collateral. Matterhorn Group, Inc., is a debtor-affiliate of Deluxe Ice Cream company. The Court previously granted the Debtors interim access to the cash which their primary secured creditor Key Bank, N.A., claim an interest. As reported in the Troubled Company Reporter on August 5, 2010, as of the Petition Date, the Debtors owed the Bank approximately $1,249,983 on a term loan and approximately $9,314,953 on a revolving line of credit. The Debtors would use the cash collateral to fund their Chapter 11 case, pay suppliers and other parties. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the bank and the other creditors (i) an equity cushion in excess of 20%; (ii) adequate protection payments; (iii) replacement liens; and (iv) continued operation of the Debtors' business, which will preserve the value of the Debtors' assets, business and going concern value. About Deluxe Ice Cream Company Matterhorn Group, Inc., owns 100% of the equity of Deluxe Ice Cream Company and Vitafreze Frozen Confections, Inc. The companies are independent producers of ice cream and water-ice novelty products in the United States. They operate from manufacturing facilities in Sacramento, California, and Salem, Oregon. The companies' administrative office is in Las Vegas, Nevada. Boise, Idaho-based Deluxe Ice filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. E.D. Calif. Case No. 10- 39670), along with Matterhorn Group, Inc. (Case No. 10-39672) and Vitafreze Frozen Confections, Inc. (Case No. 10-39664). Deluxe Ice and Vitafreze Frozen each estimated assets and debts at $10 million to $50 million. On August 3, 2010, the Court ruled that the bankruptcy cases be jointly administered, with Matterhorn Group as the lead case. DELUXE ICE: Creditors Have Until January 7 to File Proofs of Claim ------------------------------------------------------------------ The Hon. Michael S. McManus of the U.S. Bankruptcy Court for the Eastern District of California has set January 7, 2011, as the deadline of creditors to file proofs of claim against Deluxe Ice Cream Company, et al. Proofs of claim requesting for allowance or payment of an administrative claim; and resulting or arising from the Debtors' rejection of an expired lease or executory contract, must be filed with: Ron Bender, Esq. LEVENE, NEALE, BENDER, YOO & BRILL L.L.P. 10250 Constellation Boulevard, Suite 1700 Los Angeles, CA 90067 Tel: (310) 229-1234 Fax: (310) 229-1244 E-mail: rb@lnbyb.com Matterhorn Group, Inc., owns 100% of the equity of Deluxe Ice Cream Company and Vitafreze Frozen Confections, Inc. The companies are independent producers of ice cream and water-ice novelty products in the United States. They operate from manufacturing facilities in Sacramento, California, and Salem, Oregon. The companies' administrative office is in Las Vegas, Nevada. Boise, Idaho-based Deluxe Ice filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. E.D. Calif. Case No. 10- 39670), along with Matterhorn Group, Inc. (Case No. 10-39672) and Vitafreze Frozen Confections, Inc. (Case No. 10-39664). Deluxe Ice and Vitafreze Frozen each estimated assets and debts at $10 million to $50 million. On August 3, 2010, the Court ruled that the bankruptcy cases be jointly administered, with Matterhorn Group as the lead case. DIABETES AMERICA: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Diabetes America, Inc. fka Diabetes Centers of America, Inc. 11321 Fallbrook Drive Houston, TX 77065 Bankruptcy Case No.: 10-41521 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: H. Joseph Acosta, Esq. Micheal W. Bishop, Esq. LOOPER REED & MCGRAW P.C. Thanksgiving Tower, Suite 4600 1601 Elm Street Dallas, TX 75201 Tel: (214) 954-4135 Fax: (214) 953-1332 E-mail: jacosta@lrmlaw.com mbishop@lrmlaw.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Nicholas K. Vita, chairman. DISH NETWORK: Ergen Five-Year Owns 12.5 Million Class B Shares -------------------------------------------------------------- In a Form 3 filing with the Securities and Exchange Commission on December 10, 2010, Ergen Five-Year 2010 DISH GRAT disclosed that it beneficially owns 12,500,000 shares of DISH Network Corp.'s Class B common stock. On November 30, 2010, Charles W. Ergen established four GRATs, contributing 12,500,000 Class B shares to each, resulting in the transfer of a total of 50,000,000 Class B shares. The other GRATs are Ergen Four-Year 2010 DISH GRAT, Ergen Three-Year 2010 DISH GRAT and Ergen Two-Year 2010 DISH GRAT. Each Grantor Retained Annunity Trust may elect into convert any or all of its Class B shares to an equal number of Class A shares at any time for no additional consideration. There is no formal agreement to vote or dispose of the shares owned by each GRAT in a particular manner. The dispositive and voting power of the shares held by each of the GRATs is made independent of each other, except to the extent that Mrs. Cantey M. Ergen is the trustee of each of the GRATs and in that respect is able to control the disposition and voting of the shares of Class B Common Stock owned by each such GRAT. About DISH Network DISH Network Corporation is the third largest pay television provider in the United States with 14.1 million subscribers as of Dec. 31, 2009. Annual revenues approximate $11.6 billion. The Company's balance sheet at June 30, 2010, showed $9.03 billion in total assets and $10.61 billion in total liabilities, and a stockholders' deficit of $1.58 billion. * * * Dish Network carries a 'Ba3' corporate family rating, with "stable outlook", from Moody's. In March 2010, Moody's said the ratings are not affected by the announcement that a U.S. appeals court upheld a lower court's ruling that despite changes made by Dish to its DVR software, the company was still infringing on TiVo Inc.'s patents. Dish and TiVo have been in litigation since 2004 over TiVo's patent infringement claim. As a result of the ruling, the Company owes approximately $300 million in damages through July 2009 and potentially additional charges should the company be required to pay for patent infringements since July 2009. Dish announced that it will be seeking a further review of the court's latest decision by the full Federal Circuit. Moody's noted that if the company fails to win on the further review, it will have to pay a sizable sum to TiVo, but it will still have to contend with the future of its DVR product offering. Its last hope is to gain approval for a design around the TiVo patents, but if unsuccessful, Dish will need to negotiate a licensing arrangement with TiVo to avoid the risk of having to disable and replace millions of DVRs at significant expense DIVINE SQUARE: Asks for Court's Permission to Use Cash Collateral ----------------------------------------------------------------- Divine Square LW, LLC, seeks authority from the U.S. Bankruptcy Court for the Southern District of Florida to use cash collateral until December 31, 2010. As of the Petition Date, the Debtor's secured lender, Intervest National Bank, was owed approximately $14,800,000. Peter H. Levitt, Esq., at Shutts & Bowen LLP, explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/DIVINE_SQUARE_budget.pdf In exchange for using the cash collateral, the Debtor proposes to provide Intervest with a replacement lien on and in all property of the Debtor acquired or generated after the Petition Date. The Debtor proposes to afford Intervest an administrative claim with priority over all other administrative expense claims. The Debtor will also furnish Intervest with financial and other information as required by underlying loan documents or other reports as Intervest may reasonably request. The Debtor further seeks that a final hearing be held before December 31, 2010. Miami, Florida-based Divine Square LW, LLC, filed for Chapter 11 protection on December 7, 2010 (Bankr. S.D. Fla. Case No. 10- 47363). Stephen P. Drobny, Esq., at Shutts & Bowen LLP, in Miami, Florida, represents the Debtor. The Debtor estimated assets and debts of $10 million to $50 million. DK AGGREGATES: Committee Wins Nod for Heller Draper as Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Mississippi has granted the Official Committee of Unsecured Creditors in DK Aggregates LLC's Chapter 11 case permission to employ Heller, Draper, Hayden, Patrick & Horn, LLC, as its counsel as of October 6, 2010. Professionals who are expected to have primary responsibility for providing services to the Official Committee of Unsecured Creditors and their current applicable hourly rates are: Douglas S. Draper, Esq. $325 Other Partners $325 Associates $275 Paralegals $75 The Bankruptcy Court is satisfied that the firm represents no interest adverse to the estate and that it is a "disinterested person" as that term is defined under Sec. 101(14) of the Bankruptcy Code. The firm can be reached at: Douglas S. Draper, Esq. HELLER, DRAPER, HAYDEN, PATRICK & HORN, LLC 650 Poydras Street, Suite 2500 New Orleans, LA 70130 Tel: (504) 299-3300 Fax: (504) 299-3399 E-mail: ddraper@hellerdraper.com Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter 11 bankruptcy protection on August 9, 2010 (Bankr. S.D. Miss. Case No. 10-51823). Robert Alan Byrd, Esq., at Byrd & Wiser, assists the Debtor in its restructuring effort. The Debtor disclosed assets of $17,025,695 and liabilities of $7,004,953 as of the petition date. DK AGGREGATES: Panel Can Retain Wheeler & Wheeler as Local Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of Mississippi has granted the Official Committee of Unsecured Creditors in DK Aggregates LLC's Chapter 11 case permission to employ Wheeler & Wheeler, PLLC, as its local counsel as of October 6, 2010. The following professionals of Wheeler & Wheeler who are expected to have primary responsibility for providing services to the Official Committee of Unsecured Creditors and their current applicable hourly rates are: David A. Wheeler, Esq. $250 Paraprofessionals $85 The Bankruptcy Court is satisfied that the firm represents no interest adverse to the estate and that it is a "disinterested person" as that term is defined under Sec. 101(14) of the Bankruptcy Code. The firm can be reached at: David A. Wheeler, Esq. WHEELER & WHEELER, PLLC 185 Main Street Biloxi, MS 39533 Tel: (228) 374-6720 Fax: (228) 374-6721 E-mail: david@wheelerattys.com Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter 11 bankruptcy protection on August 9, 2010 (Bankr. S.D. Miss. Case No. 10-51823). Robert Alan Byrd, Esq., at Byrd & Wiser, assists the Debtor in its restructuring effort. The Debtor disclosed assets of $17,025,695 and liabilities of $7,004,953 as of the petition date. DK AGGREGATES: JL Holloway Replaced by DK Aggregates on Committee ----------------------------------------------------------------- R. Michael Bolen, the United States Trustee for Region 5, has removed J.L. Holloway from the Unsecured Creditors' Committee in the Chapter 11 case of DK Aggregates, LLC, and adds Knights Marine & Industrial Services, Inc., to the Committee. The revised Committee Members are: (1) Robert A. Byrd BYRD & WISER Post Office Box 1939 Biloxi, MS 39533 Fax: (228) 432-7029 (2) Livaudais Electrical & Construction Philip G. Livaudais 4628 East Saint Bernard Hwy. Meraux, LA 70075 Fax: (504) 309-7673 E-mail: LGP86@COX.NET (3) Soil Testing Engineering, Inc. Mason E. Lowe 188 East Capitol Street, Suite 400 Jackson, MS 39201 Fax: (601) 592-1441 E-mail: mlowe@babc.com (4) Knights Marine & Industrial Services, Inc. 2900 Colmer Road Moss Point, MS 39562 Fax: (228) 696-8880 E-mail: bknight@knightsmarine.com (5) Retif Oil & Fuel Tammy Landry 527 Destrehan Avenue Harvey, LA 70058 Fax: (504) 340-0071 E-mail: tlandry@retif.com (6) Central Scales & Controls Co. John Sanders 34624 La. Highway 16, Suite B Denham Springs, LA 70706 Fax: (225) 664-8883 E-mail: centralscalesco@bellsouth.net Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter 11 bankruptcy protection on August 9, 2010 (Bankr. S.D. Miss. Case No. 10-51823). Robert Alan Byrd, Esq., at Byrd & Wiser, assists the Debtor in its restructuring effort. The Debtor discloses assets of $17,025,695 and liabilities of $7,004,953 as of the petition date. DK AGGREGATES: Wants Plan Filing Period Extended Until March 9 -------------------------------------------------------------- DK Aggregates LLC asks the U.S. Bankruptcy Court for the Southern District of Mississippi to extend its exclusive period to file a plan for an additional 90 days from December 9, 2010, or until March 9, 2011. The Debtor told the Court it needs the extension to allow Equity Partners, Inc., time to adequately market its property and in order that it may explore all possible Plan alternatives for the benefit of the Estate. The Debtor says it is current with its operating reports and other matters and has reached agreements and has adequate protection agreements in place with Hancock Bank and the Internal Revenue Service. Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter 11 bankruptcy protection on August 9, 2010 (Bankr. S.D. Miss. Case No. 10-51823). Robert Alan Byrd, Esq., at Byrd & Wiser, assists the Debtor in its restructuring effort. The Debtor disclosed assets of $17,025,695 and liabilities of $7,004,953 as of the petition date. DUBAI WORLD: Port Terminal Unit Has $1.5BB Deal with Citi --------------------------------------------------------- DP World Limited, the port-terminal manager controlled by Dubai World, and Citi Infrastructure Investors, together with one of CII's major investors, on December 22 formed a strategic partnership to invest in, operate and manage DP World's five marine terminals in Australia. DP World has entered into an agreement to provide management services to the Australian operation to continue to provide a consistently high level of service to customers. Management and staff of DP World Australia will be retained. DP World Australiai operates container terminals in Brisbane, Sydney, Melbourne, Adelaide and Fremantle with capacity to handle in excess of 3.5 million TEU per annum, approximately 50% of the total Australian container market. For the 12 months to December 31, 2009, DP World Australia generated equity-adjustedii EBITDA of A$96 million. This transaction, which will see DP World monetise 75% of its shares in DP World Australia, values DP World Australia at an enterprise value of A$1.817 billion at closing. The total proceeds to be received by DP World will be roughly A$1.5 billion -- US$1.5 billion -- including the repayment of certain intercompany balances owing from DP World Australia to DP World Limited. The total proceeds will go towards reducing DP World's net debt as part of our overall strategy to improve balance sheet flexibility. Completion, subject to regulatory approvals, is expected towards the end of the first quarter of 2011. Mohammed Sharaf, CEO DP World said: "We are delighted that Citi Infrastructure Investors are joining us as strategic partners in Australia. We share a long term commitment to invest in and grow our terminals in the region over the long term, and together we look forward to building on our successful track record of operating container terminals in the region. "DP World has been operating terminals in Australia for over five years during which time all our terminals have undergone significant upgrades including investment in new quay side cranes to improve efficiencies for our customers. Our commitment to the region has been recognized with the recent renewal of long-term concessions in Adelaide, Brisbane and Sydney." Yuvraj Narayan, CFO of DP World commented: "This strategic partnership provides a great opportunity for DP World to remain actively involved in Australia whilst delivering on our strategy to monetise assets as part of DP World's ongoing goal to reduce leverage and focus on higher margin markets. "This transaction, including the benefits of the long-term management contract, will be earnings accretive for DP World from the time of completion." Felicity Gates, Co-Head of Citi Infrastructure Investors, said: "Australia is a key market for Citi Infrastructure Investors where we have been working for some time. We are delighted to be entering into a strategic partnership with DP World. The partnership represents an attractive investment opportunity in an important and growing market." Holly Koeppel, Co-Head of Citi Infrastructure Investors and chairperson elect of DP World Australia, said: "We look forward to working with DP World's team in Australia and we are committed to ongoing investment in the business to ensure that DP World Australia continues to offer customers the highest level of service and is well positioned to meet future growth opportunities in this attractive market." DP World is advised by Deutsche Bank AG and Citigroup Global Markets. CII is advised by HSBC and UBS. DP World is one of the largest marine terminal operators in the world, with 50 terminals and 11 new developments and major expansions across 31 countries. DP World Australia Pty is the holding company for DP World's port assets and does not include P&O Maritime Services or POTA. As reported by the Troubled Company Reporter on October 29, 2010, Dubai World secured support from all its creditors for a $25 billion debt restructuring plan. As reported by the TCR on September 24, 2010, Bill Rochelle, the bankruptcy columnist for Bloomberg News, said Dubai World received approval from most creditors to alter the terms on $24.9 billion of debt. According to the report, the Company and its main creditor banks agreed in May 2010 to restructure $14.4 billion of loans and $8.9 billion of government liabilities. The company said banks would be paid $4.4 billion in five years and another $10 billion over eight years at below-market interest rates supported by assets sales. As reported by the TCR on December 15, 2010, Dow Jones' Daily Bankruptcy Review said Dubai's ruler turned to a trusted uncle, Sheik Ahmed Bin Saeed Al Maktoum, to put Dubai World back on track after the government conglomerate secured creditor approval to restructure almost $25 billion in debt. About Dubai World Dubai World -- http://www.dubaiworld.ae/-- is Dubai's flag bearer in global investments. As a holding company it operates a highly diversified spectrum of industrial segments and plays a major role in the emirate's rapid economic growth. Dubai World's investment spans four strategic growth areas of 21st Century commerce namely, Transport & Logistics, Drydocks & Maritime, Urban Development and Investment & Financial Services. Dubai World's portfolio includes DP World, one of the largest marine terminal operators in the world; Drydocks World & Dubai Maritime City designed to turn Dubai into a major ship-building and maritime hub; Economic Zones World which operates several free zones around the world including Jafza and TechnoPark in Dubai; Nakheel the property developer behind iconic projects such as The Palm Islands and The World among others; Limitless the international real estate master planner with current development projects in various parts of the world; Leisurecorp a global sports and leisure investment group, reshaping the industry by unlocking value across investment, development and brand opportunities; Dubai World Africa which oversees the regional development and portfolio of investments in the African continent; and Istithmar World, the group's investment arm that has a global footprint in finance, capital, leisure, aviation and various other business ventures. DYNEGY INC: Seneca to Rally Shareholders Against Icahn Deal ----------------------------------------------------------- Seneca Capital Investments, LLC, and its affiliated entities said in a regulatory filing that they do not support Dynegy Inc's Agreement and Plan of Merger with Carl Icahn's IEH Merger Sub LLC, and IEP Merger Sub Inc. Seneca said it intends to urge other shareholders not to tender their stock in the Offer. As reported by the Troubled Company Reporter on December 16, Dynegy said its Board of Directors has unanimously approved a definitive agreement to be acquired by Icahn Enterprises LP in a tender offer followed by a merger for $5.50 per share in cash, or approximately $665 million in the aggregate. Dynegy has approximately $3.95 billion of outstanding debt, net of cash. As reported by the TCR on November 24, 2010, Dynegy shareholders thumbed down the Company's proposed merger agreement with The Blackstone Group. The Blackstone Group had offered to acquire Dynegy for $5.00 per share in cash. Seneca Capital is the second largest shareholder of Dynegy, with a 12% economic interest -- including 9.3% voting common stock. Seneca Capital said the Icahn offer is at "the WRONG PRICE at the WRONG TIME for the WRONG REASONS." Seneca Capital said Dynegy's Board abandoned its pretense of an "open alternatives process" in a desperate stratagem to lock-up support from the Company's largest shareholder against the pending consent solicitation to remove Directors. According to Seneca, Dynegy's continued mission to impose a transaction upon shareholders at any price -- and at any cost -- is a brazen attempt to disenfranchise shareholders and to seize management's $38 million change-of-control severance. "After shareholders resoundingly and rightly rejected the Company's transparent, scorched-earth campaign (including dire warnings that Dynegy stock would plummet if the Blackstone deal was voted down), Dynegy leadership's frantic attempts to sell the Company have degenerated into a carnival barker-like spectacle," Seneca said in a statement. Seneca pointed out that less than one month ago, the Board granted a $16 million break-fee to Blackstone in return for a minimal purchase price bump that yielded barely 26% support. This is also the same Board that agreed, in August of 2009, to purchase nearly 30% of the Company from the then-largest shareholder at $9.65 per share. Seneca believes Dynegy has continued to stall bidders eager to engage in due diligence, proffering onerous confidentiality agreements at the same time that management raced to secure a change-of-control transaction with the Company's largest shareholder (formerly, one of management's most ardent opponents) ahead of the Seneca Capital consent solicitation. Seneca Capital is pursuing consent solicitation to replace Dynegy's CEO-Chairman and one other Board member with Hunter Harrison, a railroad executive, and Jeff Hunter, a power industry veteran. Seneca Capital believes Dynegy is the premier vehicle to play a power-price recovery with a valuation of $6-$7 per share, rising to $16-$18 per share in a recovery. ELEPHANT TALK: Files Post-Effective Amendment to Form S-8 --------------------------------------------------------- Elephant Talk Communications, Inc. filed with the Securities and Exchange Commission on December 14, 2010, a post-effective amendment to a Form S-8 Registration Statement regarding the Company's offer to sell 1 million shares of common stock under the 2006 Non-Qualified Stock and Option Compensation Plan. The Post-Effective Amendment No. 2 to the Registration Statement dated July 21, 2006, is filed for the sole purpose of filing as an exhibit the written consent of the Company's independent registered public accounting firm for the years ended December 31, 2008 and December 31, 2009. A copy of the written consent is available for free at http://ResearchArchives.com/t/s?7156 About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. The Company's balance sheet at Sept. 30, 2010, showed $41.68 million in total assets, $69.79 million in total liabilities, and a stockholders' deficit of $28.10 million. Stockholders' deficit was $14.9 million at June 30, 2010. * * * As reported in the Troubled Company Reporter on April 7, 2010, BDO Seidman, LLP expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for 2009. The independent auditors noted that the Company incurred a net loss of $17.4 million, used cash in operations of $5.4 million and had an accumulated deficit of $62.3 million. EMPIRE RESORTS: L. Capelli Reports 7.50% Equity Stake ----------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on December 13, 2010, Louis R. Capelli disclosed that he beneficially owns 5,192,311 shares of Empire Resorts, Inc. common stock representing 7.50% of the shares outstanding. LRC Acquisition LLC also owns 5,107,311 shares representing 7.35% equity stake. The percentages are based upon a total of 69,479,340 shares of Common Stock outstanding as of November 11, 2010 as reported in Empire's Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2010. For services rendered by Louis R. Cappelli as director of Empire Resorts, Inc.: (i) on April 14, 2009, Empire granted to Cappelli options which are currently exercisable to purchase 75,000 shares of Common Stock; (ii) on January 4, 2010, Empire granted to Cappelli 10,000 shares of restricted Common Stock pursuant to Empire's 2005 Equity Incentive Plan, which grant was cancelled upon the resignation of Cappelli from the Board of Directors of Empire, and (iii) on January 4, 2010, Empire granted to Cappelli options which are currently exercisable to purchase 10,000 shares of Common Stock. In addition, on December 9, 2010, Cappelli resigned from his position as a member of the Board of Directors of Empire, effective immediately. About Empire Resorts Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY) -- http://www.empireresorts.com/-- owns and operates Monticello Casino & Raceway, a video gaming machine and harness racing track and casino located in Monticello, New York, 90 miles northwest of New York City. The Company's balance sheet at Sept. 30, 2010, showed $74.91 million in total assets, $63.20 million in total liabilities, and stockholders' equity of $11.71 million. Auditor Friedman LLP, in New York, after auditing the Company's 2009 results, said Empire Resorts' ability to continue as a going concern depends on the Company's ability to fulfill its obligations with respect to its $65 million of 5-1/2% senior convertible notes. Friedman also noted of the Company's continuing net losses and negative cash flows from operating activities. ENERGAS RESOURCES: Incurs $80,371 Net Loss in October 31 Quarter ---------------------------------------------------------------- Energas Resources Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $80,371 on $58,459 of total revenue for the three months ended Oct 31, 2010, compared with a net loss of $127,978 on $35,821 of total revenue for the same period a year ago. The Company's balance sheet at Oct. 31, 2010, showed $7.48 million in total assets, $1.19 million in total liabilities, and stockholders' equity of $6.29 million. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?7154 About Energas Resources Based in Oklahoma City, Oklahoma, Energas Resources Inc. (OTC BB: EGSR) -- http://www.energasresources.com/-- is primarily engaged in the operation, development, production, exploration and acquisition of petroleum and natural gas properties in the United States through its wholly-owned subsidiary, A.T. Gas Gathering Systems Inc. In addition, the company owns and operates natural gas gathering systems located in Oklahoma, which serve wells operated by the company for delivery to a mainline transmission system. The majority of the company's operations are maintained and occur through A.T. Gas. Smith, Carney & Co. P.C. has expressed substantial doubt against Energas Resources Inc.'s ability as a going concern after auditing the Company's results for the fiscal year ended January 31, 2010. In its Form 10-K filed with the U.S. Securities and Exchange Commission, the Company reported a net loss of $1.9 million on $165,794 of total revenue for the year ended Jan. 21, 2010, compared with a net loss of $2.4 million on $284,297 total revenue during the same period a year ago. ERLINA AREVALO: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Erlina M. Arevalo 4600 Rochelle Drive Union City, CA 94587 Bankruptcy Case No.: 10-74558 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Northern District of California (Oakland) Judge: Edward D. Jellen Debtor's Counsel: Michael H. Luu, Esq. LAW OFFICES OF MICHAEL H. LUU 1340 Tully Road, #309 San Jose, CA 95122 Tel: (408) 425-6221 E-mail: mikeluu63@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb10-74558.pdf FIRST ACCEPTANCE: A.M. Best Affirms 'B' Financial Strength Rating ----------------------------------------------------------------- A.M. Best Co. has affirmed the financial strength ratings (FSR) of B (Fair) and issuer credit ratings (ICR) of "bb+" of First Acceptance Insurance Group (First Acceptance) (Nashville, TN) and its members. Concurrently, A.M. Best has affirmed the ICR of "b" of First Acceptance Corporation (Delaware) [NYSE: FAC], the group's ultimate parent holding company. The outlook for all ratings remains positive. (Please see below for a detailed listing of the companies.) The affirmation of the ratings is primarily based on the group's historically high underwriting leverage ratios and weak capitalization, along with unstable loss reserve development in recent years. These negative rating factors are partially offset by a stronger balance sheet and improved leverage in recent years coupled with historically positive earnings. The group members operate under an intercompany pooling arrangement and proportionately share in the overall underwriting performance of First Acceptance. In addition, First Acceptance benefits from the added financial flexibility of its publicly traded holding company to raise capital through equity or debt during favorable investment markets. The holding company's current debt-to-capital and interest coverage ratios are modest and within an acceptable range for the current ratings. Furthermore, these rating actions contemplate that management will successfully navigate through today's challenging markets by continuing to control growth and taking steps to improve; pricing and rate setting processes; fraud detection; underwriting; and upgrading its marketing and distribution strategy. The ratings have been affirmed for First Acceptance Insurance Group and its following pooled members: -- First Acceptance Insurance Company, Inc. -- First Acceptance Insurance Company of Georgia, Inc. -- First Acceptance Insurance Company of Tennessee, Inc. FIRST DATA: Moody's Assigns 'Caa1' Ratings to $2 Bil. Senior Notes ------------------------------------------------------------------ Moody's Investors Service assigned Caa1 ratings to First Data Corp.'s new $2 billion 8.25% Senior Second Lien Notes due 2021, $1 billion PIK Toggle Senior Second Lien Notes due 2022, and $3 billion 12.625% Senior Unsecured Notes due 2021. Moody's also affirmed the company's existing ratings with a stable outlook. The new ratings were assigned in connection with the completion of First Data's recent debt exchange, in which the company exchanged about $3 billion of 9.875% Senior Notes due 2015 and $3 billion 10.55% Senior PIK Notes due 2015 for $6 billion of the new debt. The $3 billion of new second lien debt issued (plus the maximum allowable PIK accrual of no more than $300 million) falls below the $3.5 billion limit allowed by the amended credit facility. Ratings Rationale First Data's B3 corporate family rating reflects Moody's view that the company's capital structure continues to improve with the extension in maturity of about $6 billion of junior debt to 2021 and 2022. The improvement of the debt maturity profile may help facilitate the refinancing of a major portion of the $12 billion of term loan due September 2014, which represents the company's nearest maturity. In addition, by refinancing $3 billion of the previous $3.7 billion of 10.55% PIK notes, which converts to cash pay beginning October 1, 2011 (with the first such payment occurring in March 2012), First Data could save over $300 million in annual cash interest payments depending on whether the company chooses to PIK the new $1 billion PIK Second Lien Notes (allowable until the end of the 3rd year). The stable outlook reflects Moody's expectation that First Data will generate mid-single digit percentage revenue and EBITDA growth during 2011 as the economy slowly recovers and the shift of payment method to electronic cards from cash and checks continues. Moody's expect the company will maintain credit metrics consistent with B3 rated companies with modest improvement to its financial leverage and other credit metrics. Ratings affirmed: -- Corporate family rating at B3; -- Probability-of-default rating at B3; -- $2 billion Senior Secured Revolving Facility due 2013 at B1 (LGD 2, 24%) -- $12 billion Senior Secured Term Loan B due 2014 at B1 (LGD 2, 24%) -- $510 million Senior Secured First Lien notes of B1 (LGD 2, 24%) -- $784 million Senior Unsecured Cash Pay Notes due 2015 at Caa1 (LGD 5, 78% from LGD 5, 74%) -- $675 million Senior Unsecured PIK Notes (due 2015) at Caa1 (LGD 5, 78% from LGD 5, 74%) -- $2.5 billion Senior Subordinated Notes (due 2016) at Caa2 ( LGD 6, 91% from LGD 6, 92%) Ratings assigned: -- $2 billion 8.25% Senior Second Lien Notes due 2021 of Caa1 (LGD 4, 63%) -- $1 billion PIK Toggle Senior Second Lien Notes due 2022 of Caa1 (LGD 4, 63%) -- $3 billion 12.625% Senior Unsecured Notes due 2021 of Caa1 (LGD 5, 78%) Based in Atlanta, Georgia, First Data Corporation, with over $10.2 billion of revenue for the twelve months ended September 30, 2010, provides commerce and payment solutions for financial institutions, merchants, and other organizations worldwide. FIRST OCCUPATIONAL: Organizational Meeting on Dec. 29 ----------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on December 29, 2010, at 12:00 p.m. in the bankruptcy case of First Occupational Center of New Jersey, Inc. The meeting will be held at the United States Trustee's Office, One Newark Center, 14th Floor, Room 1401, Newark, NJ 07102. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Orange, New Jersey-based First Occupational Center of New Jersey, Inc., filed for Chapter 11 bankruptcy protection on December 1, 2010 (Bankr. D. N.J. Case No. 10-47328). Melinda D. Middlebrooks, Esq., at Middlebrooks Shapiro & Nachbar, P.C., serves as the Debtor's bankruptcy counsel. According to its schedules, the Debtor disclosed $4,693,595 in total assets and $8,344,272 in total liabilities as of the Petition Date. FONTAINEBLEAU LV: Files Privilege Logs With District Court ---------------------------------------------------------- Fontainebleau Resorts LLC notified the U.S. District Court for the Southern District of Florida that it has served three privilege logs in response to the Court's supplemental sanction order in connection with the April 22, 2010 subpoena filed by the Term Lenders. Each of the privilege logs pertain to e-mails contained in the e- mail server/hard drive. Fontainebleau Resorts notes that the e- mails identified on each of the privilege logs have not been produced and have been withheld from production. "The only caveat to this response would be any inadvertent production of which counsel is not presently aware," says Sarah J. Springer, Esq., at Waldman Trigoboff Hildebrandt Marx & Calnan, P.A., in Weston, Florida. In addition, Fontainebleau Resorts also filed its opposition to the Term Lenders' supplemental memorandum supporting their Motion for Sanctions. While Fontainebleau Resorts is respectful of the Term Lender's apparent willingness to waive any claim for monetary sanctions, in doing so, they seek to impale Fontainebleau Resorts with a proverbial "Morton's Fork" by suggesting that it is required to choose from two alternatives, neither of which is warranted, Ms. Springer alleges. According to Wikipedia, a Morton's Fork is a choice between two equally unpleasant alternatives, or two lines of reasoning that lead to the same unpleasant conclusion. As previously reported, the Term Lenders told the Court in their supplemental memorandum that they are not asking for monetary compensation from Fontainebleau Resorts in connection with their Motion for Sanctions, "but not while retaining the risk that they will then be pilloried for having obtained and reviewed privileged documents that [Fontainebleau Resorts] took no steps to review." Fontainebleau Resorts should not be required to incur the expense of responding to the April 22 Subpoena or conducting additional searches, Ms. Springer argues. She points out that the efforts undertaken by Fontainebleau Resorts to work cooperatively with the Term Lenders, to respond to the April 22 Subpoena, to seek appropriate protection, and to comply with the Court's requirements have been extensive. The Court should not find a wholesale waiver of privilege and should not endorse the Term Lenders' request to use Fontainebleau Resorts' records in any manner they wish, Ms. Springer contends. She alleges that having obtained full access to Fontainebleau Resorts' records through the subpoena process, the Term Lenders now seek the Court's imprimatur to allow them to use these confidential and potentially privileged documents for whatever purpose they wish and without any further obligations whatsoever. Fontainebleau Resorts insists that the Court should deny the Term Lenders' request. Term Lenders Clarify Log Content The Term Lenders clarified with the Court that Fontainebleau Resorts has only provided logs of the e-mail server, and that no privilege log has been provided pertaining to the approximately 800 gigabytes of data, nearly 600,000 documents, contained in the document server. Fontainebleau Resorts' counsel has represented that it has not reviewed and does not intend to review any data on the document server, either for responsiveness or for privilege, Lorenz Michel Pruss, Esq., at Dimond Kaplan & Rotherstein PA, in Coconut Grove, Florida, asserts on behalf of the Term Lenders. Court Clarifies Issue In practical terms, says United States Magistrate Judge Jonathan Goodman, the Term Lenders through their supplemental memorandum are seeking protection in case they encounter privileged information in the data produced by Fontainebleau Resorts. At this time, however, the Court is not prepared to summarily grant the alternative relief that the Term Lenders now request, Judge Goodman said. He maintained that the waiver relief was not originally requested in their Motion for Sanctions, and the privilege dilemma that the Term Lenders' describe appears to be a consequence of Fontainebleau Resorts' defective/non-responsive production, not a sanctions issue flowing from Fontainebleau Resorts' failure to timely produce documents and data, which was the cause of the Term Lenders' original motion for sanctions. Judge Goodman also noted that Fontainebleau has not affirmatively asserted that any of the documents or data it produced on the documents and accounting servers actually contain privileged information. He explained that Fontainebleau's lack of a specific privilege objection to particular data on the two servers is, apparently, the result of its failure to even review the two servers for privilege in the first place. Although the Term Lenders state they are "not asking the Court to reach the waiver issue in the context of this sanctions motion," the requested relief necessarily contemplates a decision that Fontainebleau Resorts waived privileges, Judge Goodman said. Accordingly, if the Term Lenders wish to pursue the alternate waiver remedy to their Motion for Sanctions, Judge Goodman directed them to file a motion, which will specifically explain both the relief sought and why the issue is ripe for adjudication. Term Lenders' Motion for Determination Accordingly, the Term Lenders filed a request asking the Court to issue an order determining that Fontainebleau Resorts waived any and all otherwise applicable privileges and protections when it produced its document server without conducting any review. The Term Lenders argue that Fontainebleau Resorts waived all applicable privileges when it knowingly produced hundreds of thousands of documents to the Term Lenders without conducting any review or taking any other steps to prevent the disclosure of privileged documents. Fontainebleau Resorts' decision to produce its documents without any review places a substantial and unfair burden on the Term Lenders and the other banks, who have received Fontainebleau Resorts' document server, Mr. Pruss contends. He asserts that absent relief from the Court, Fontainebleau Resorts may argue that the Term Lenders have an ethical obligation to inform Fontainebleau Resorts of the existence of any document that may be privileged, and, if Fontainebleau Resorts determines that it is in fact privileged, remove it from any place it has been stored and retrieve it from anyone to whom it may have been given. Given the enormous universe of potentially privileged documents, this cumbersome process will substantially complicate and slow the Term Lenders' efforts to review Fontainebleau Resorts' documents, Mr. Pruss explains. He insists that Fontainebleau Resorts' extended failures to produce documents already has stalled deposition discovery in the action for months, and that Fontainebleau Resorts should not be permitted to impose additional delays by failing to review the documents it finally did produce. Defendant Bank of America, N.A., joins in the Term Lenders' Motion for Determination. Fontainebleau Resorts Object The Term Lenders themselves have previously described the underlying litigation as a "legal storm," Ms. Springer reminds the Court. She avers that Fontainebleau Resorts, though not a party to this litigation, has found itself caught up in that storm. The Court should decline the Term Lenders' invitation to find a wholesale waiver on the part of Fontainebleau Resorts because the Term Lenders created this predicament by causing Fontainebleau Resorts to incur an undue burden and expense in responding to their subpoena and corresponding Court Orders, Ms. Springer argues. Despite having limited resources, Fontainebleau Resorts has fully complied with the April 22 Subpoena, Ms. Springer says. She adds that Fontainebleau Resorts has also taken reasonable efforts under the circumstances to protect its privileges in the process, militating against any finding of waiver. When Fontainebleau Resorts was unable to incur the incredible expense of conducting a privilege review of the document server, and at the same time comply with the Term Lenders' April 22 Subpoena and the Court's requirements, it provided Term Lenders with the document server, Ms. Springer asserts. District Court Judge Alan S. Gold referred the Motion for Determination to U.S. Magistrate Judge Jonathan Goodman. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleu Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC and its units filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represented the Debtors in their restructuring effort. The Debtors' claims agent is Kurtzman Carson Consulting LLC. Attorneys at Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP, represent the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than $1 billion in debt and a similar amount in assets, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, listed less than $50,000 in assets and more than $1 billion in debts. In February 2010, Icahn Enterprises L.P. acquired from Fontainebleau Las Vegas and certain affiliated entities, the Fontainebleau property and improvements thereon located in Las Vegas, Nevada, for an aggregate purchase price of around $150 million. The bankruptcy case was subsequently converted to Chapter 7. Soneet R. Kapila has been named the trustee for the Chapter 7 case of Fontainebleau Las Vegas. GARRISON ROAD: Grants Lift Stay to Secured Creditor --------------------------------------------------- The U.S. Bankruptcy Court for the District of Maryland approved a stipulation terminating the automatic stay effective December 31, 2010, to permit Seneca Partnership, LLC, its assigns or its successors in interest to exercise its rights on Garrison Road, LLC's asset. The rights include those set forth in the promissory note and deed of trust by and between the Seneca and the Debtor, and the right to initiate foreclosure proceedings on real property located at 2908-2936 Garrison Blvd., Baltimore, Maryland. The Debtor's debt to Seneca is $1,980,097 plus interest at the applicable legal rate from November 2, 2009, until satisfied, and is secured by a lien on the real property. In the event of a sale of the property, Seneca will be required to pay the surplus proceeds of sale, if any, to the U.S. Trustee for distribution to parties-in- interest as their respective interests may appear. KH Funding Co., consented to the termination of the automatic stay. Seneca is represented by: Thomas J. Kokolis, Esq., Law Offices of Craig A. Parker, LLC 110 North Washington Street, Suite 500 Rockville, MD 20850 Tel: (301) 656-5775 E-mail: tj@parkerlawoffice.com KH Funding is represented by: Bradley J. Swallow, Esq. 233 E. Redwood St. Baltimore, MD 21202 Tel: (410) 576-4000 About Garrison Road, LLC KH Funding Co. filed for an Involuntary Chapter 11 protection for Potomac, Maryland-based Garrison Road, LLC, on June 25, 2010 (Bankr. D. Md. Case No. 10-24344). Lawrence Coppel, Esq., represents KH Funding. GARY PHILLIPS: Asks for Court's Permission to Use Cash Collateral ----------------------------------------------------------------- Gary Phillips Construction, LLC, seeks authority from the U.S. Bankruptcy Court for the Eastern District of Tennessee to use the cash collateral securing debts to its prepetition lenders. The Debtor, along with Gary and Karla Phillips, is a co-maker and guarantor on notes with: Approximate Amount of Claim --------------- a. Citizens Bank $2,250,509 b. Commercial Bank $406,632 c. First Bank & Trust $815,176 d. First Tennessee Bank $363,229 e. Regions Bank $2,447,180 f. Tri-Summit Bank $1,269,900 g. TruPoint Bank $1,050,033 The Banks claim a security interest in certain receivables, personal property and real properties of the Debtor. Fred M. Leonard, Esq., at Gary Phillips Construction, LLC, explains that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor believes that its current assets upon which the Banks claim a lien have a value much in excess of that necessary to adequately protect the interest of the Banks. The Debtor further proposes as adequate protection to the Banks to deposit in a designated Plan Account a share from any sale of property and/or rental income. Regions Bank, Commercial Bank, TriSummit Bank, Citizens Bank, First Tennessee Bank, have filed objection to the Debtor's request to be allowed to use cash collateral. The Court has set a hearing for January 18, 2011, at 2:00 p.m. on the Debtor's request. Piney Flats, Tennessee-based Gary Phillips Construction, LLC, filed for Chapter 11 bankruptcy protection on December 3, 2010 (Bankr. E.D. Tenn. Case No. 10-53097). Fred M. Leonard, Esq., who has an office in Bristol, Tennessee, serves as the Debtor's counsel. According to its schedule, the Debtor disclosed $13,255,698 in total assets and $7,614,399 in total debts as of the Petition Date. GEBO PROPERTIES: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Debtor: GEBO Properties, LLC 6805 Fairview Road Charlotte, NC 28210 Bankruptcy Case No.: 10-33745 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court Western District of North Carolina (Charlotte) Judge: George R. Hodges Debtor's Counsel: David R. Badger, Esq. DAVID R. BADGER, P.A. Suite 118, Atherton Lofts 2108 South Boulevard Charlotte, NC 28203 Tel: (704) 375-8875 Fax: (704)375-8835 E-mail: davebadger@carolina.rr.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ First Citizens Bank Bank loan $10,000 P.O. Box 1580 Roanoke, VA 24007-1580 The petition was signed by Robert N. Burris, member. Debtor-affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Eugene K. Ehmann, Sr. 10-30518 02/27/2010 GENERAL MOTORS: Firms Quote Prices of Default Swaps on New Debt --------------------------------------------------------------- Barclays Capital and Goldman Sachs started quoting prices on credit default swaps tie to senior unsecured debt of General Motors Co. on December 14, 2010, even though the company has not yet issued any bonds, Katy Burne of the Dow Jones Newswires reported. Dow Jones Newswires said a Barclays spokesperson declined to comment and a Goldman spokesperson confirmed the firm was making markets in the swap. The report added that a senior trader at another major dealer said the firm was looking into quoting CDSs on GM, but wanted more legal and operational certainty over the exact entity the CDSs would cite. Ms. Burne noted that after its bankruptcy filing, buyers of CDS tied to General Motors Corp.'s unsecured debt received 87.5 cents on every dollar of CDS protection they bought. Protection tied to Old GM loans was valued at 97.5 cents on the dollar, Ms. Burne recalled. At that time, Old GM debt outstanding was around $2.4 billion, Ms. Burne added. It is being speculated that should the new GM issue bonds next year, it would do so at the General Motors Co. level rather than at General Motors Holdings, and that having CDS levels in the market would help investors get comfortable with how a potential bond offering might price, Dow Jones Newswires said. Dow Jones Newswires further reported that pricing being offered on the GM CDS is in the range of 330/340 basis points, citing a person who had seen the Barclays quotes. Because GM has not issued bonds, it means that if the credit default swaps had to be settled, the CDS could potentially be worthless, Dow Jones Newswire pointed out. However, if there is no debt to deliver, or in GM's case if the $5 billion credit facility is not deemed to be eligible as a deliverable obligation, the CDS could not be settled in exchange for cash, the report added. Those decisions on CDS settlement criteria are made by a special committee of the International Swaps and Derivatives Association on a case-by-case basis. In a recent development, GM may be able to issue long-term bonds at a yield of about 6.5%, according to data, Mary Childs of Bloomberg News reported on December 16. Contracts protecting GM's bonds are at a mid-price of 338 basis points from 345 on December 14, 2010, Bloomberg noted, citing Barclays Capital data. Michael Kraft, senior portfolio manager at New York-based Crimson Capital Trading LLC, told Bloomberg that GM may be able to sell debt that pays 50 basis points more than Ford bonds of the same maturity. That would mean a yield of about 6.25 percent on 5-year notes and 6.5 percent on 10-year debt, Mr. Kraft elaborated, the report noted. Bloomberg recalled a previous interview with GM Chief Financial Officer Chris Liddell wherein he said the company may offer a "relatively small" bond issue. According to Noreen Pratscher, a spokeswoman for GM, the company does not discuss bond offerings before issuing a regulatory filing for the sale. Credit swaps pay the buyer face value if a borrower fails to meet its obligations, less the value of the defaulted debt, Ms. Child explained. Ms. Childs added that a basis point equals $1,000 annually on a contract protecting $10 million of debt. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. is 60.8% owned by the U.S. Government. It was formed to acquire the operations of General Motors Corporation through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, $971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: GM Nova Scotia Has New GM Backing for Claims ------------------------------------------------------------ The Official Committee of Unsecured Creditors for Motors Liquidation Co., formerly General Motors Corp., is asking the U.S. Bankruptcy Court to disallow: -- Claim No. 69551 filed by the holders of notes issued by General Motors Nova Scotia Finance Company against Motors Liquidation Company f/k/a General Motors Corporation and certain of its subsidiaries in the amount of $1,072,557,531; and -- Claim No. 66319 filed by Green Hunt Wedlake, Inc., trustee of Nova Scotia Finance against the Debtors in the amount of $1,607,647,592. The Claims, according to the Committee's counsel, Eric B. Fisher, Esq., at Butzel Long, APC, in New York, arise out of a settlement agreement, known as the "Lock-Up Agreement," with a number of the Noteholders entered into on June 1, 2009, the same day that Old GM filed for bankruptcy. The Lock-Up Agreement was grossly one- sided, disproportionately benefiting the Noteholders and leaving Old GM's estate depleted to the detriment of its creditors, Mr. Fisher tells the Court. In response, Green Hunt Wedlake, Inc., trustee of General Motors Nova Scotia Finance Company, argues that: (i) the prepetition lock-up agreement was negotiated at arm's- length and in good faith among the parties with the supervision and approval of the US and Canadian governments to facilitate the 363 Sale; (ii) the obligations incurred by the parties under the lock-up agreement were incurred in exchange for fair and just consideration; and (iii) the claims asserted by certain holders of notes issued by GM Nova Scotia and the Nova Scotia Trustee are wholly separate and distinct. Phillip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, explains the Nova Scotia's Claim No. 66319 for $1,607,647,592 arises directly as a result of General Motors Corp. purposefully creating GM Nova Scotia as an unlimited liability company under the Companies Act. Pursuant to its statutory mandate, the Nova Scotia Trustee is winding up GM Nova Scotia, and Old GM, having already received the benefits associated with structuring GM Nova Scotia as an ULC is required to satisfy the liabilities set forth in the Nova Scotia Trustee Claim, he stresses. In contrast, the claims totaling $758,486,107 filed by the Noteholders is a direct contract claim that they have against Old GM pursuant to an express guarantee contained in the Fiscal and Paying Agency Agreement, he points out. The mere fact that Old GM is required to satisfy the Guarantee Claim and the Wind-up Claim does not render those claims duplicative, he asserts. Mr. Dublin also contends that for the Committee to rely on Section 502(d) of the Bankruptcy Code, it must have obtained a finding by the Court that the consent fee was an avoidable transfer and that the Noteholders or GM Nova Scotia are liable for the turnover of those amounts under the Bankruptcy Code. As no judgment exists, Section 502(d) is inapplicable, he argues. As to the Committee's request for equitable subordination, which notably lacks any reference to governing case law, the Committee does not allege inequitable conduct by the Nova Scotia Trustee, he points out. The Nova Scotia Trustee also objects to the Committee's request to void limited portions of the 363 Sale Order for its own benefit and should thus be rejected. "The Lock Up Agreement -- which the Committee seeks to undo -- is a central cog in the larger structure that allowed the 363 Sale to New GM to close, ensure the continued viability of General Motors and provide substantial consideration in the form of New GM stock to creditors of the Debtors' estates," Mr. Dublin stresses. Counsel to certain holders issued by GM Nova Scotia on July 10, 2003, in the aggregate principal amount of GBP600,000,000, Gary D. Ticoll, Esq., at Greenberg Traurig LLP, in New York, asserts that in attacking the Lock-Up Agreement and the Noteholders, the Committee has chosen to attack the integrity and responsibility of the GM Parties who participated in the Lock-Up Agreement and the transactions taken. The objecting noteholders are Appaloosa Management L.P.; Aurelius Capital Management, LP; Elliott Management Corporation and Fortress Investment Group LLC, Specifically, the Committee has put GM Canada at risk, because, pursuant to the Lock-Up Agreement, the intercompany loans owing by GM Canada to GM Nova Scotia of C$1.3 billion will be reinstated and become immediately due and payable if the Consent Fee is successfully challenged, Mr. Ticoll contends. The Appaloosa Noteholders have in good faith performed their obligations and have forgone other substantial rights in reliance upon the Lock-Up Agreement and the transactions contemplated, Mr. Ticoll says. The Committee's allegations of bad faith and its belated attacks on the Lock-Up Agreement defy credulity, he points out. Mr. Ticoll notes that the Committee principally bases its Claims Objection on arguments that the Lock-Up Agreement and the Consent Fee are avoidable under the Bankruptcy Code. However, those contentions of the Committee must be rejected for these reasons: * Any claim to avoid the Lock-Up Agreement or any transfer or payment by MLC to GM Canada was purchased by New GM as part of the MSPA approved by the Sale Order, and the estate of MLC does not own any of those avoidance claims. * The Consent Fee was funded by GM Canada and paid by GM Nova Scotia, neither of which is a Debtor. * The Court has not authorized the Committee to bring an avoidance action against the Appaloosa Noteholders. * The Lock-Up Agreement was assumed by MLC and, having assumed the Lock-Up Agreement, MLC's estate is barred from seeking to avoid its obligations under the Lock-Up Agreement. * Judicial estoppel bars the Committee from challenging the Lock-Up Agreement or the Consent Fee. In separate joinders, Citigroup Global Markets Inc. and a group of holders of the notes issued by GM Nova Scotia adopted the arguments of the Appaloosa Noteholders. The joining group of noteholders is composed of Anchorage Capital Master Offshore Ltd.; Canyon-GRF Master Fund, L.P.; Canyon Value Realization Fund L.P.; CSS, LLC; Knighthead Master Fund, LP; LMA SPC for and on behalf of MAP 84; Lyxor/Canyon Realization Fund, Ltd.; Onex Debt Opportunity Fund, Ltd.; Redwood Master Fund Ltd; and The Canyon Value Realization Master Fund, L.P. New GM Supports Green Hunt, et al.'s Claims "The elimination of about C$1.3 billion of GM Canada's liabilities and the resolution of the Nova Scotia Action, as set forth in the Lock-Up Agreement, were important pieces of Old GM's restructuring plan and facilitated the sale to New GM," Arthur Steinberg, Esq., at King & Spalding LLP, in New York, counsel to New GM, reminds the Court. He continues that the execution of the Lock-Up Agreement before the Petition Date insulated GM Canada from having to commence a bankruptcy proceeding, which unquestionably preserved GM Canada's value, but ensured that the sale could proceed expeditiously. Thus, the Committee's belated attempt to upset a critical piece of the sale to New GM is prejudicial to, among others, Old GM, New GM and GM Canada, who have relied on the binding effect of the terms contained in the Sale for over a year, Mr. Steinberg stresses. However, the Committee's attacking the assumption and assignment of the Lock-Up Agreement through Rule 60(b) relief serves no purpose, Mr. Steinberg argues. New GM wanted the Lock-Up Agreement assigned to it to ensure that the "cooperation" covenant imposed on Old GM was complied with, he relates. The "cooperation covenant" was the only significant remaining executory provision of the Lock-Up Agreement at the time of the assignment, he says. He emphasizes that New GM's objective was to protect GM Canada. New GM believes that while the Debtors acknowledged the validity of the Guarantee Obligations and the Wind-Up Claim, the Lock-Up Agreement, by its terms, did not constitute the allowance of any claims by the Noteholders or the Nova Scotia Trustee, Mr. Steinberg notes. However, the operative language of the Lock-Up Agreement remained the same: Old GM agreed not to object to the claims of the Noteholders or the Nova Scotia Trustee, but the Lock-Up Agreement provides that those claims would only be allowed "to the fullest extent permitted under applicable law," he asserts. In the event the Courts grants any relief on account of the Claims Objection, New GM asks the Court that any relief granted specifically provide that there has been no breach of the Lock-Up Agreement by Old GM, New GM or GM Canada. It is of paramount concern to New GM that the Court's ultimate ruling has no affect on GM Canada, or any of the assets purchased by New GM under the Assumption Order, Mr. Steinberg explains. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. is 60.8% owned by the U.S. Government. It was formed to acquire the operations of General Motors Corporation through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, $971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: New GM Completes Purchase of $2.1 Bil. Pref. Stock ------------------------------------------------------------------ General Motors Co. confirmed it has taken another step to reduce its financial leverage with the completion of the $2.1 billion purchase of the GM 9% Series A Preferred Stock held by the United States Department of the Treasury, according to a public statement dated December 15, 2010. The 84 million shares of stock were purchased on December 15 by GM from the Treasury at $25.50 per share; a 2% premium over the liquidation value. As previously announced, the company plans to record a charge of approximately $0.7 billion to net income attributable to common stockholders for the difference between the purchase price and the recorded value of the Series A Preferred Stock under fresh- start accounting. GM will provide an update of its balance sheet, including current assets, liabilities, pension funding status and post-IPO ownership structure when it files its 2010 Form 10-K in early 2011. With GM's payment of the Treasury of $2.1 billion, the Treasury said GM has now repaid more than $23 billion to the government since receiving a bailout in 2008, Dunstan Prial of FoxBusiness reported. The Treasury's remaining stake in GM consists of 500,065,254 shares of common stock, the report added. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. is 60.8% owned by the U.S. Government. It was formed to acquire the operations of General Motors Corporation through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, $971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: New GM to Seal Letter of Intent With Leson ---------------------------------------------------------- General Motors LLC ("New GM") sought and obtained U.S. Bankruptcy Court permission to file a revised letter of intent it executed with Leson Chevrolet Company, Inc., as exhibit to a proposed stipulation under seal. New GM will deliver to the Clerk of the Court or Chief Deputy Clerk of the Court: (a) a hard copy of the Revised LOI to be filed under seal and (b) a 3.5 inch floppy disk containing the sealed Revised LOI and this sealing order. The disk will be submitted in an envelope, clearly labeled with the case name and number, and if applicable, the document number assigned to the sealed document, and hard copies of this Sealing Order will be attached to the hard copy of the sealed Revised LOI and to the 3.5 inch disk. The Clerk of the Court or Chief Deputy Clerk of the Court will not file the sealed Revised LOI either conventionally or electronically, provided that the docket will indicate that the Revised LOI has been filed under seal. New GM will serve a copy of the Sealing Order, the Application and the Revised LOI on counsel to Leson at the same time as it is delivered to the Clerk of the Court or Chief Deputy Clerk of the Court. The requirement for the filing of a memorandum of law setting forth the points and authorities relied upon in New GM's Motion under Rule 9013-1(b) of the Local Bankruptcy Rules for the Southern District of New York, is waived, Judge Gerber said. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. is 60.8% owned by the U.S. Government. It was formed to acquire the operations of General Motors Corporation through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, $971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERICS INTERNATIONAL: Moody's Withdraws 'B3' Corp. Family Rating ------------------------------------------------------------------ Moody's Investors Service withdrew the ratings of Generics International (US), Inc. including the B3 Corporate Family Rating. This action follows the recent acquisition of the company by Endo Pharmaceutical Holdings Inc. and subsequent repayment of Generic International's outstanding debt. Ratings of Generics International (US), Inc. withdrawn: -- B3 Corporate Family Rating -- B3 Probability of Default Rating -- B2 (LGD3, 36%) senior secured revolving credit facility due 2013 -- B2 (LGD3, 36%) senior secured first lien term loan due 2014 -- B2 (LGD3, 36%) senior secured delayed-draw term loan due 2014 -- Caa2 (LGD5, 86%) senior secured second lien term loan due 2014 Moody's last rating action on Generics International took place on September 28, 2010, when Moody's placed the ratings under review for possible upgrade. Generics International (US), Inc., is the parent company of QV Pharmaceuticals, Inc, and Vintage Pharmaceuticals, LLC, and their wholly owned subsidiaries, Qualitest Pharmaceuticals, Inc., and Vintage. Through these subsidiaries, Generics International is a manufacturer and distributor of generic pharmaceutical products in a variety of formulations including tablets, capsules, liquids, suspensions and gels. The principal subsidiary, Qualitest Pharmaceuticals, is headquartered in Huntsville, Alabama. GEO GROUP: S&P Puts 'BB-' Corporate Rating on CreditWatch Negative ------------------------------------------------------------------ Standard & Poor's Ratings Services said that it placed its ratings on Boca Raton, Florida-based The GEO Group Inc., including the 'BB-' corporate credit rating, on CreditWatch with negative implications. As of Oct. 3, 2010, GEO Group had about $1.05 billion of debt, including nonrecourse debt. "S&P placed the ratings on CreditWatch negative to reflect the company's more aggressive financial policy given its proposed debt-financed acquisition of BI Inc," explained Standard & Poor's credit analyst Brian Milligan. S&P estimates that GEO Group's pro forma adjusted debt to EBITDA will increase to about 4.9x from 4.1x if the acquisition closes according to the company's proposed capital structure. In addition, S&P believes there is increased acquisition integration risk given the size of the BI Inc. acquisition coupled with GEO Group's acquisition of Cornell Cos. Inc. in August 2010. S&P could lower the rating if S&P believes GEO's leverage is unlikely to decline to less than 4x over the next year. S&P believes a higher debt balance, as well as the integration risks associated with the two sizable acquisitions, points to a more aggressive financial policy. Alternatively, S&P could affirm the ratings if the proposed acquisition is structured to allow the company's credit measures to remain within 'BB' category medians, which includes leverage declining to less than 4x over the next year. GLOBAL DIVERSIFIED: Incurs $1.1 Mil. Net Loss in Oct. 31 Quarter ---------------------------------------------------------------- Global Diversified Industries Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $1.10 million on $2.01 million of revenues for the three months ended Oct. 31, 2010, compared with a net loss of $462,909 on $193,366 of revenues for the same period a year ago. The Company's balance sheet at Oct. 31, 2010, showed $14.20 million in total assets, $10.31 million in total liabilities, $7.51 million in net preferred stock series D, $1.75 million in net preferred stock series C, and $3.04 million in net preferred stock series C, and stockholders' deficit of $8.41 million. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?7152 About Global Diversified Chowchilla, Calif.-based Global Diversified Industries, Inc., is a holding company for two wholly owned subsidiaries, Lutrex Enterprises, Inc., an entity which holds equipment and inventory for the Company, and Global Modular, Inc., an entity which provides sales, marketing, manufacturing and construction site work of modular type structures. M&K CPAS, PLLC, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern, following its results for the fiscal year ended April 30, 2010. The independent auditors noted that the Company has suffered recurring losses and has generated negative cash flows from operations. GREAT ATLANTIC & PACIFIC: Wins Interim OK to Pay Lottery Proceeds ----------------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors obtained interim court approval to pay all prepetition lottery proceeds to state lottery agencies; gift proceeds to Blackhawk Marketing Services Inc.; wire transfer funds and money order funds to Western Union North America; and the proceeds from the sale of consigned goods. The interim order dated December 14, 2010, also authorized all financial institutions where the Debtors accounts are maintained to honor and pay all checks presented for payment and to fund all transfer requests made by the Debtors to the extent there are sufficient funds available in those accounts. The Court will consider final approval of the Debtors' request at the hearing scheduled for January 10, 2011. The deadline for filing objections is January 4, 2011. About A&P Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific (A&P) is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. The Great Atlantic & Pacific Tea Company, Inc., and its affiliates filed petitions under Chapter 11 of the U.S. Bankruptcy Code on December 12, 2010 (Bankr. S.D.N.Y. Case No. 10-24549) in White Plains. As of September 11, 2010, the Debtors reported total assets of $2.5 billion and liabilities of $3.2 billion. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Bankruptcy Creditors' Service, Inc., publishes GREAT ATLANTIC & PACIFIC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by A&P and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). GREAT ATLANTIC & PACIFIC: Wins Interim OK to Pay Sales & Use Taxes ------------------------------------------------------------------ The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors obtained interim court approval to earmark as much as $14 million to pay their prepetition taxes, business license and other fees. The interim order authorized financial institutions where the Debtors' accounts are maintained to honor and pay all checks presented for payment and fund all transfer requests made by the Debtors. It also permitted those institutions to rely on the Debtors' representations as to which checks and transfers are authorized to be paid without further inquiry and liability for following the Debtors' instructions. The final hearing on the proposed payment of taxes will be held on January 10, 2011. The deadline for filing objections is January 4, 2011. About A&P Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific (A&P) is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. The Great Atlantic & Pacific Tea Company, Inc., and its affiliates filed petitions under Chapter 11 of the U.S. Bankruptcy Code on December 12, 2010 (Bankr. S.D.N.Y. Case No. 10-24549) in White Plains. As of September 11, 2010, the Debtors reported total assets of $2.5 billion and liabilities of $3.2 billion. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Bankruptcy Creditors' Service, Inc., publishes GREAT ATLANTIC & PACIFIC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by A&P and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). GREAT ATLANTIC & PACIFIC: Wins Interim OK to Protect NOLs --------------------------------------------------------- The Great Atlantic & Pacific Tea Company Inc. and its affiliated debtors obtained an interim order establishing notification and hearing procedures for: (i) the transfers of equity securities that must be complied with before transfers of the stock are deemed effective; and (ii) asserting a claim of worthless stock deduction with respect to the equity securities that must be complied with before the claims of worthless stock deductions are deemed effective. Any purchase, sale or other transfer of, or declaration of worthless stock deduction with respect to equity securities in The Great Atlantic & Pacific Tea Company Inc. or of any beneficial interest therein in violation of the procedures will be null and void ab initio, according to the interim order dated December 15, 2010. The interim order does not apply to the 5.125% convertible senior notes due 2011, and the 6.75% convertible senior notes due 2012, which were issued by The Great Atlantic & Pacific Tea Company Inc. The Court will consider final approval of the Debtors' request at the hearing scheduled for January 10, 2011. The deadline for filing objections is January 4, 2011. About A&P Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific (A&P) is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. The Great Atlantic & Pacific Tea Company, Inc., and its affiliates filed petitions under Chapter 11 of the U.S. Bankruptcy Code on December 12, 2010 (Bankr. S.D.N.Y. Case No. 10-24549) in White Plains. As of September 11, 2010, the Debtors reported total assets of $2.5 billion and liabilities of $3.2 billion. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Bankruptcy Creditors' Service, Inc., publishes GREAT ATLANTIC & PACIFIC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by A&P and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). GSC GROUP: Objects to Lenders' Request for a Chapter 11 Trustee --------------------------------------------------------------- GSC Group Inc. is balking at a group of lenders' demand that a trustee oversee the hedge fund, Dow Jones' Small Cap reports. According to the report, GSC filed its objection with the U.S. Bankruptcy Court in Manhattan, after the lender group said it was concerned two GSC executives have "extracted personal consideration" from Black Diamond Capital Management LLC - a lender trying to buy GSC's assets for $235 million. The report notes that fearing that the executives have become "quasi-agents" of Black Diamond, the lender group asked the bankruptcy court to approve the appointment of a Chapter 11 trustee. GSC acknowledged that its chief executive, Alfred Eckert, entered into consulting and option agreements with Black Diamond, and that GSC's president, Peter Frank, entered into an employment agreement with the proposed buyer, the report notes. But "standing alone, those agreements do not disqualify either individual from performing his responsibilities" to GSC's bankruptcy estate, the hedge fund said, Dow Jones' discloses. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, the motion for a Chapter 11 trustee was filed by a group calling themselves non-controlling lenders. About GSC Group Florham Park, New Jersey-based GSC Group, Inc. -- http://www.gsc.com/-- is a private equity firm specializing in mezzanine and fund of fund investments. It filed for Chapter 11 bankruptcy protection on August 31, 2010 (Bankr. S.D.N.Y. Case No. 10-14653). Michael B. Solow, Esq., at Kaye Scholer LLP, assists the Debtor in its restructuring effort. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice and claims agent. Capstone Advisory Group, LLC, is the Debtor's financial advisor. The Debtor estimated its assets at $1 million to $10 million and debts at $100 million to $500 million. HARRIS COUNTY: Moody's Affirms 'Ba3' Senior Lien Rating ------------------------------------------------------- Moody's Investors Service, Inc., has affirmed the underlying ratings on the outstanding bonds of Harris County - Houston Sports Authority, including the Ba3 senior lien rating, B2 junior lien rating, and B3 third lien rating. The rating has been removed from watchlist for possible downgrade and a negative outlook has been assigned. All bonds were originally insured by MBIA, and remain insured by National Public Finance Guarantee Corp (Insurance Financial Strength rated Baa1/developing outlook). Harris County - Houston Sports Authority is a special purpose entity created to finance the construction of Reliant Stadium, Toyota Center and Minute Maid Park. Ratings Rationale The ratings affirmations reflect Moody's belief that the ratings accurately reflect the high expected recovery on the bonds, despite the likelihood of a payment default in about 18 months on the junior lien bonds depending on the amount of collateral posting required on the outstanding swaps with UBS (senior unsecured rated Aa3/negative outlook) and the future performance of the pledged hotel (HOT) and motor vehicle rental taxes. The B2 junior lien rating reflects the Authority's significantly increased debt service costs due to the acceleration of principal payments on the variable rate junior lien bonds as a result of the inability to obtain replacement Standby Bond Purchase Agreements, given that the bonds are insured by MBIA/National, whose ratings were downgraded or withdrawn prior to the renewal time. This resulted in a mandatory put of the variable rate junior lien bonds to the prior SBPA provider, JP Morgan Chase & Co (senior unsecured rated Aa3/negative outlook), who accelerated the debt service payments. This acceleration, coupled with weaker than expected tax revenue performance, has resulted in significantly weaker debt service coverage below 1.0x and has lead to a draw on the liquidity reserve of about $5.3 million in November of 2010 to reimburse MBIA for their payments under the surety policy. The B3 third lien bond rating reflects the super subordinate lien position of the bonds and the fact that they do not begin to amortize until 2031 through 2041, leaving these bondholders least protected, as well as the cross default provision under the bond indenture. The Ba3 senior lien bond rating primarily reflects the cross default provision under the bond indenture, whereby when the additional required liquidity reserve is depleted in 2012 or 2013, depending on the swap collateral posting requirement, and a junior lien redemption payment is missed, the senior lien bonds will also be in default. This technical default does not entitle bondholders to accelerated payments. The below investment grade rating also incorporates the narrowing debt service coverage due to both revenue underperformance and the rising debt service schedule that continues to increase over the remaining bond term. The two notch rating difference acknowledges the satisfactory debt service coverage ratios of the senior lien bonds by the HOT/MVRT revenues. Coverage ratios have declined from above 2.0 times in 2007 and 2008 to 1.9 times in 2009 and a projected 1.8 times in 2010. Given the rising debt service schedule coverage is conservatively projected to be around 1.6 to 1.7 times in the near term, assuming flat HOT/MVRT revenue growth post 2010. If HOT/MVRT revenues remain flat through the bond term, debt service coverage will still be above 1.0 times. Outlook The negative outlook reflects the expectation that pledged HOT/MVRT revenues will continue to underperform and pressure coverage margins on all bonds given rising debt service schedules. The outlook also incorporates the likely depletion of the Authority's liquidity to cover the accelerated redemption payments on the junior lien variable rate bonds in the next 12 to 18 months resulting in an issuer payment default. What Could Change the Rating Up The ratings could be upgraded if HOT/MVRT revenues substantially improve, such that debt service coverage of the accelerated junior variable rate bonds redemption payments is above 1.0 times, thus not depleting the liquidity. What Could Change the Rating Down The ratings could be further downgraded if the recovery prospects for bondholders are deemed to be less than currently anticipated and/or if HOT/MVRT revenues continue to decline or only remain flat over time, as this will pressure the coverage on the senior and junior lien fixed rates bonds given their rising debt service payment schedules. The rating could also be downgraded if the liquidity is depleted more rapidly and/or a payment default occurs. Recent Developments: The swaps associated with the variable rate junior lien Series C, D, and E with UBS had a mark-to-market value of about $28 million in UBS's favor as of December 13, 2010. Given the downgrade of the underlying ratings below investment grade, the swap provider (UBS) is entitled to collateral from the Authority up to the full amount of the current mark-to-market value. The Series E bonds are the exclusive responsibility of the Houston Texans via their lease agreement and the Texans have reportedly continued to pay their accelerated obligation directly. This is a key rating factor because the Houston Texans may have to post the collateral on the UBS swap associated with the Series E bonds, which reduces the amount of cash the Authority must post, thus providing about $7 million more in cash to cover the accelerated redemption payments in the near term. Should current projected 2010 revenue performance hold over the next couple of years and the Authority is only required to post about $22 million in collateral for the Series C and D bonds, then assuming the bank bond interest rate and a 30 bps swap receipts, the Authority's liquidity will run out in mid 2013, prior to the November 2013 redemption payment. This could be earlier if more collateral is required to be posted, the pledged revenues underperform the current year's experience, or interest rates move away from the Authority. The Authority, UBS, and the Houston Texans are negotiating the amount of collateral the Authority will be required to post from its cash reserves and how much, if any, collateral The Texans will have to post for the Series E bonds. Per the Texans lease agreement, it appears likely that the sports team may be required to cover any termination payment due upon a termination related to the Series E swap, so the source for collateral posting for that swap remains a point of discussion between the sports team and MBIA. The Texas State Attorney General's office approved the Authority's negotiating process, a requirement if an agreement is reached. UBS has the right to terminate the swaps if no collateral is posted and would then be entitled to the full mark- to-market termination payment. Given the funds that will pay the termination payment are also the funds that will pay the accelerated debt service payments, UBS and JPMorgan have opposing interests and an ultimate resolution may hinge on whether or not the banks elect to cash out of the transaction with MBIA making both banks whole as the insurer for the swaps, including the termination payment. MBIA is key in the negotiation process. As the bond insurer, they direct the proceedings as they are ultimately responsible for making the principal and interest payments, the net swap and swap termination payments (up to a certain amount), and the accelerated redemption payments. Discussions and negotiations have continued for over a year now and Moody's has low confidence in a resolution being reached that would result in positive rating movement. The HOT/MVRT revenues since August have trended in opposite directions, with motor vehicle taxes continuing to decline while hotel taxes have slightly risen. Moody's anticipates an anemic recovery of these tax revenues over time that would ultimately be insufficient to generate sufficient cash flow, along with the other pledged revenues, to cover the accelerated debt service. Debt service requirements have substantially grown in the near term, due to the acceleration of debt service payments on the Series 2001 C, D, and E bonds by JP Morgan Chase & Co, which acted as the standby bond purchase provider. JP Morgan was able to accelerate the bonds because the standby bond purchase agreement expired without renewal or replacement in May of 2009. The acceleration requires the Authority to repay approximately $115 million of debt by May 2014, rather than by the original maturity schedule through 2030. Payments according to the accelerated schedule began in November of 2009. Legal Security * Senior - HOT/MVRT Revenues and Astros Rent * Junior Fixed - Junior lien on the HOT/MVRT Revenues * Junior VRDB - Series C - Rodeo Rent and Rodeo Events Revenue, prorata share of Governmental Events Revenue * Junior VRDB Series D - Houston Texans Rent and Houston Texans Events Revenue, pro-rata share of up to $4 million of Parking Revenue at Reliant Stadium, $1.5 million of HOT/MVRT on a junior lien basis, and pro-rata share of Governmental Events Revenue * Junior VRDB Series E - Houston Texans lease payments equivalent to actual debt service, pro-rata share of up to $4 million of Parking Revenue at Reliant Stadium, and pro-rata share of Governmental Events Revenue * Third Lien - Third lien on the HOT/MVRT Revenues Rated Debt Outstanding: List by lien and amount outstanding in each (based on 12/31/2009 accreted values for capital appreciation bonds, and adjusted for 2010 redemption and principal payments). * Senior Bonds - rated Ba3 * Series 2001 A ($131.3 million) * Series 2001 G ($172.9 million) * Junior Fixed -- rated B2 * Series 2001 B ($220.2 million) * Series 2001 H ($91.5 million) * Junior VRDB - Rated B2 * Series 2001 C ($27.2 million) * Series 2001 D ($34.8 million) * Series 2001 E ($18.2 million) * Third lien -- rated B3 * Series 2004 A-2, A-3 ($43.5 million) Regulatory Disclosures Harris County - Houston Sports Authority's ratings were assigned by evaluating factors Moody's believes are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of HCHSA's core industry and HCHSA's ratings are believed to be comparable to those of other issuers of similar credit risk. HARRISBURG, PA: Budget A Point Of Contention Days Before Vote ------------------------------------------------------------- Dow Jones' Small Cap reports that the 2011 budget for Pennsylvania's distressed capital city remains a matter of debate days before it must be approved, as several Harrisburg City Council members push for deeper expenditure cuts. According to the report, at a budget committee meeting, several council members advocated 10% cuts for every department in the $57 million spending plan proposed by Mayor Linda Thompson. They prefer the reductions over the city selling land under parking garages to the Harrisburg Parking Authority to fill a $4.3 million hole, the report relates. "We are living in times where tough decisions need to made," Dow Jones' quoted councilwoman Susan Brown-Wilson, who chairs the budget committee, as saying. But Thompson's administration is opposed to making further cuts to the budget, which is $8 million less than the 2010 one, and other council members raised concerns that city operations would be adversely affected, the report notes. "There is no fat in this budget," said Council President Gloria Martin-Roberts, the report adds. About Harrisburg, PA The city of Harrisburg is coping with debt related to a failed revamp of an incinerator. The outstanding principal on the Incinerator debt is $288 million. Total principal and interest on this debt would amount to approximately $458 million. Debt service payments on the total incinerator debt are $20 million per year. Of this total, Dauphin County, Pennsylvania, is responsible for roughly $10 million and Harrisburg is responsible for the other $10 million. The city is guarantor on 100% of the $288 million Incinerator debt. The City Council of Harrisburg, Pennsylvania, voted 5-2 on September 28 to seek professional advice on bankruptcy or state oversight. Harrisburg needed state aid to avoid default on $3.3 million of bond payments this month. The city has missed about $8 million in debt-service payments this year on bonds issued in connection with a trash-to-energy incinerator. The city owes another $40 million by the end of the year, and was sued by its home county Dauphin County; bond insurer Assured Guaranty Municipal Corp., a unit of Assured Guaranty Ltd.; and bond trustees TD Bank and M&T Bank Corp. over $19 million in skipped bond payments. In November 2010, the city council tapped Cravath, Swaine and Moore LLP as debt restructuring advisors. Cravath is working on "pro bono" basis. HAWKS PRAIRIE: Has Until March 15 to Sell 337-Acre Property ----------------------------------------------------------- Rolf Boone, staff writer at the Olympian, reports that Hawks Prairie Investment has until March 15, 2011, to sell its 337-acre property as part of a bankruptcy approved settlement for a net price of $35 million. Mr. Boone relates that, if it sells for that amount, secured creditors will be repaid in this order: Thurston County, for unpaid property taxes, followed by HomeStreet Bank and two other creditors -- Howard Talbitzer and Anthony Glavin. HomeStreet, which is ranked second, third and fifth in order of priority, according to the revised plan documents, also says it is owed $16.55 million in the fifth spot, although $10.3 million of that amount is in dispute. Otherwise, HomeStreet and Talbitzer/Glavin "may hold non-judicial foreclosure sales." Olympia, Washington-based Hawks Prairie Investment LLC owns real property in Thurston County, Washington. It filed for Chapter 11 bankruptcy protection on August 13, 2010 (Bankr. W.D. Wash. Case No. 10-46635). Timothy W. Dore, Esq., at Ryan Swanson & Cleveland PLLC, assists the Debtor in its restructuring effort. An affiliate, Pacific Investment Group LLC, filed a separate Chapter 11 petition on October 22, 2009 (Bankr. W.D. Wash. Case No. 09-47915). HAYES LEMMERZ: S&P Raises Corporate Credit Rating to 'B' -------------------------------------------------------- Standard & Poor's Ratings Services said it has raised its corporate credit and issue-level ratings on auto supplier Hayes Lemmerz International Inc. to 'B' from 'B-'. The outlook is stable. "The upgrade reflects S&P's opinion that Hayes's free cash generation, although still low, is sufficient to support the higher rating," said Standard & Poor's credit analyst Lawrence Orlowski. The ongoing recovery in light-vehicle and commercial- vehicle production in North America and Europe and continuing growth in demand in South America and Asia are leading to better cash generation. S&P also think the company's better manufacturing productivity, lower SG&A costs, and closure or divestiture of unprofitable plants will support the company's financial results, even if the recovery in vehicle demand is gradual. Still, S&P expects free operating cash flow in 2010 and 2011 to be less than $20 million in each year, in part because S&P assumes capital expenditures will remain at levels significantly higher than those in 2009; moreover, the company has no revolving credit facility. Hayes's sales and EBITDA margin have improved so far during fiscal 2010. S&P believes higher profitability has resulted not only from the recovery in production but also from various restructuring actions and from a reduction in pension and other postretirement benefit expenses, which were reduced in bankruptcy. However, the relatively lackluster free operating cash flow, in S&P's view, and the lack of a bank revolving credit facility, rather than leverage, are primary factors in S&P's assessment of the company's financial risk profile as aggressive. S&P believes its cash flow is susceptible to the inherent volatility in automotive production and raw material prices. Even if the recovery in light-vehicle and commercial-truck production in North America and Europe continues at the rate S&P assume, S&P expects free operating cash flow to be fairly low in fiscals 2010 and 2011. Vehicle production levels have improved during 2010. Although light-vehicle production in most regions of the world is growing at double-digit rates, production in Western Europe is relatively lackluster and could fall in 2011, especially now that numerous government-sponsored incentive schemes have ended. For 2010, S&P expects light-vehicle sales in Western Europe to be lower year over year than they were in 2009, during which sales were weak, and up by only about 10% in the U.S. S&P believes the year-over- year comparison in production levels and hence supplier revenues could be better than the sales comparison, following automakers' extensive inventory reduction in 2009. S&P considers Hayes's business risk profile to be vulnerable, largely because of the volatility of auto and truck production, high fixed costs, and the commodity-like nature of the wheels business. Still, Hayes has good geographic breadth--more than 80% of its sales are outside North America--and limited exposure to the U.S. operations of the Michigan-based automakers. It also has strong market positions in many global automotive and truck markets. However, pricing power is negligible partly because of fierce competition and industry overcapacity, which the recent downturn has exacerbated. At the end of the second quarter in fiscal 2010, Hayes closed an aluminum wheel manufacturing facility in Barcelona, Spain, to address lingering overcapacity. The outlook is stable. S&P's ratings reflect its assumption that vehicle demand is recovering in most regions of the world. S&P could raise the ratings if S&P believed that Hayes's free operating cash flow would be more robust, that is, greater than $40 million, during fiscal 2011 on a sustained basis and if the company arranged financing that bolstered liquidity sufficiently to withstand any future volatility in vehicle production. S&P would also need a better understanding of the financial and strategic choices likely to be made by the company's owners (former creditors). S&P could lower its ratings if the company had negative free cash flow in fiscal 2011. According to its assumptions, Hayes could use cash if the EBITDA margin remained below 9.5% for multiple quarters because of a sudden drop in revenues from another decline in automotive production, unrecovered raw material costs, or a combination of these factors. This could occur if, for instance, revenue was flat in fiscal 2011 and gross margins fell below 9.5%. HILL COUNTRY: Sues Bank to Block Foreclosure of Shopping Center --------------------------------------------------------------- Tim Adkins, writing for The Ashland City Times, reports that Hill Country Investors, the developer of the Owen Place Shopping Center in Ashland City, Tenn., has sued Fifth Third Bank earlier this month in Davidson County Chancery Court to block a potential foreclosure of the property. According to the Times, the suit relates Hill Country Investors entered into an agreement with Fifth Third Bank in April 2007 for a $3.7 million loan to finance improvements at the shopping center. Both parties agreed to extend the loan, resulting in a May 15 maturity date. The suit says prior to flooding in May 2010, all payments had been timely. After the flood, Fifth Third assured the plaintiffs that it would enter into a forbearance agreement, while other tenants were sought. But a special asset manager with the bank reversed the decision and told the plaintiffs that their proposal was "inadequate for the bank to seriously consider." The suit says if the plaintiffs had been given timely notice that Fifth Third would not offer a reasonable renewal or extension of the loan, the plaintiffs would have sought other financing options and would likely have been successful. According to the Times, Ashland City mayor Gary Norwood said he hopes a solution can be worked out between the two parties. If the shopping center were to close, the mayor said it would hurt the city because a huge chunk of sales tax is generated from those businesses. HOMES TO GO: Case Summary & 17 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Homes To Go Realty, Inc. dba Homes To Go 8803 Futures Drive, Unit 10 Orlando, FL 32819 Bankruptcy Case No.: 10-22419 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Middle District of Florida (Orlando) Debtor's Counsel: Michael E. Morris, Esq. MORRIS LEGAL GROUP, PLLC P.O. Box 536044 Orlando, FL 32853 Tel: (407) 894-0853 Fax: (407) 835-6613 E-mail: mike@morrislegalgroup.com Scheduled Assets: $796,500 Scheduled Debts: $1,110,594 A list of the Company's 17 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb10-22419.pdf The petition was signed by Fariborz Fard, president. IHEALTH TECHNOLOGIES: Moody's Raises Corp. Family Rating to 'B1' ---------------------------------------------------------------- Moody's Investors Service changed the ratings of iHealth Technologies, Inc., that were recently assigned on November 30, 2010 as a result of the change in the proposed capital structure. Specifically, the corporate family and probability of default ratings were raised to B1 and B2, respectively. Additionally, the ratings assigned to the Company's proposed senior secured facilities were raised to B1 from B2. The change in the ratings reflect the reduction in the proposed debt offering, resulting in lower opening leverage, a reduction in the proposed dividend to $129 million from $205 million, as well as expectations for further deleveraging stemming from larger debt amortization requirements for the proposed credit facility. The senior secured term loan was reduced to $175 million from $250 million and the senior secured revolving credit facility was reduced to $30 million from $50 million. The ratings outlook is stable. These ratings were changed: * Corporate Family Rating to B1 from B2 * Probability of Default Rating to B2 from B3 * Proposed $30 Million Senior Secured Revolving Credit Facility to B1 (LGD3 - 35%) from B2 (LGD3 - 35%) * Proposed $175 Million Senior Secured Term Loan to B1 (LGD3 - 35%) from B2 (LGD3 - 35%) The assigned ratings are subject to satisfactory review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. Ratings Rationale iHealth's B1 CFR is supported by the Company's moderate pro forma credit metrics for the rating category, its competitive market position within the growing payment policy management space as a provider of payment integrity services; its deep-domain clinical expertise, which increases the Company's value-added service offerings; and the benefits from secular healthcare reform and resulting increase in claims volume, which should drive solid revenue and free cash flow growth prospects. Additionally, the rating reflects Moody's expectation that iHealth will maintain a conservative leverage profile and a good liquidity position as well as contribute a significant portion of its excess free cash flow towards debt repayment. Conversely, iHealth's B1 CFR is constrained by its still sizeable debt load (partly arising from the planned dividend payment to shareholders); modest overall size and scale, particularly relative to larger and financially stronger Healthcare IT payment solution providers; high customer concentration; and a concentrated business profile and niche product/service offerings. In addition, the rating is constrained by iHealth's ownership structure by financial sponsors, which confers a degree of event risk, as the financial sponsors' interests may not be aligned with those of debt-holders. Pro forma for the revised transaction, iHealth's leverage as measured by its debt to EBITDA (including Moody's standard analytical adjustments) will be in the 2.9x-range based on pro forma financial results for the trailing twelve months. The stable outlook reflects Moody's expectation that iHealth will maintain its competitive market position, generate solid revenue growth, and produce consistent levels of operating profits and cash flows as claim volumes increase with a recovering economy in 2011. The stable outlook also incorporates Moody's expectation that the iHealth will be able to reduce leverage to the mid-2.0x- range by fiscal year-end 2011 through a combination of modest EBITDA growth and debt prepayment through excess free cash flow generation. Given iHealth's modest size/scale, narrow product focus, and the potential for future debt-financed shareholder distributions, a ratings upgrade is unlikely over the medium-term. Moody's could downgrade iHealth's ratings if the Company were to experience significant declines in revenue and cash flow as a result of poor execution and heightened competition or its financial policies become overly shareholder-friendly, which results in a degradation of credit metrics. Specifically, negative rating pressure could arise if the Company is unable to maintain leverage below 3.5x and free cash flow falls below 10% of its adjusted debt. Additionally, a contraction in the Company's liquidity position, including the inability to maintain adequate financial covenant headroom, may also result in a negative rating action. Based in Atlanta, Georgia, iHealth Technologies, Inc. is a provider of payment policy management solutions for healthcare organizations. It provides payment integrity services to health plans to administer the correct coding of healthcare claims and provides solutions including payment policy selection, content management, configuration, and the accurate application of payment policies. The Company is owned by private equity firms Goldman Sachs Capital Partners and Oak Investment Partners as well as Management. IK/S-BAR, LLC: Case Summary & 17 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: IK/S-Bar, LLC 1521 N. Vine Street Hollywood, CA 90028 Bankruptcy Case No.: 10-64247 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Vincent P. Zurzolo Debtor's Counsel: Michael S. Kogan, Esq. ERVIN COHEN & JESSUP LLP 9401 Wilshire Boulevard, 9th Floor Beverly Hills, CA 90212-2974 Tel: (310) 273-6333 Fax: (310) 859-2325 E-mail: mkogan@ecjlaw.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 17 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-64247.pdf The petition was signed by Ivan Kane, managing member. INDIANTOWN COGENERATION: Fitch Affirms 'BB' Rating on Bonds ----------------------------------------------------------- Fitch Ratings has affirmed the 'BB' rating of Indiantown Cogeneration L.P.'s taxable first mortgage bonds due 2010 and 2020, and issued a new rating of 'BB' for 100% owned finance subsidiary, Indiantown Cogeneration Funding Corp., which is a co- issuer and co-obligor for the first mortgage bond issue on a joint and several basis. Fitch has also affirmed Martin County Industrial Development Authority's tax-exempt facility revenue bonds due 2025 that are the obligation of ICLP. The Rating Outlook for all three issuers is Stable. Fitch has taken these rating actions: -- Indiantown Cogeneration L.P. affirmed at 'BB'; -- Martin County Industrial Development Authority affirmed at 'BB'; -- Indiantown Cogeneration Funding Corp. new issue rating 'BB'. The rating affirmations and new issue rating reflect ICLP's long- term financial profile, which remains vulnerable to potential disparities between contractual energy revenues and variable fuel costs. The 2009 debt service coverage ratio was greater than originally projected at 1.42 times due largely to a positive energy margin. Year-to-date 2010 financials show a Fitch calculated return to negative energy margins, which could lead to a decrease in the DSCR for full year 2010. Fitch expects DSCRs to range between 1.30x and 1.15x in the rating case absent a favorable resolution to ongoing negotiations with Florida Power & Light Co. Cash flow stability would be enhanced if ICLP establishes a sustainable alignment between the energy payment mechanisms in the power purchase agreement and actual fuel costs incurred by the project. Fitch has evaluated ICLP's credit quality on a stand-alone basis, independent of the credit quality of its owners. The Stable Outlook reflects the current emissions regulatory environment surrounding coal fired power plants. Though ICLP's exposure to environmental legislation regulating greenhouse gas emissions has been an ongoing concern, it is unclear when such a legislation may take place. Fitch currently lacks sufficient information to accurately assess the potential magnitude, timing and distribution of future emissions costs. The PPA allows ICLP to recover variable fuel costs; however, the timing for reimbursement of such costs during the year is generally dictated by FPL. As a result, ICL often experiences a lag in recovering increased variable costs. Pricing under the current coal supply agreement expires in 2011, and ICLP remains vulnerable to a potential disconnect between fuel costs and energy revenues going forward. However, ICLP is primarily dependent upon fixed-price capacity payments and has demonstrated the ability to achieve high levels of availability and maintain maximum capacity payments in the course of normal operations. ICLP consists of a 330-MW coal-fired cogeneration facility located in Martin County, Florida. ICLP supplies energy and capacity to FP&L under a long-term PPA. ICLP also provides steam to Louis Dreyfus Citrus, an international juice processing company, in order to maintain qualifying facility status. ICLP was formed to construct, own, and operate the Indiantown facility, which began commercial operation in December 1995. ICLP receives availability-based, fixed-price capacity payments that comprise the bulk of revenues (60%-70%) and effectively represent all of ICLP's profitability. Capacity payments are structured to reimburse ICLP's fixed O&M costs, pay debt service, and provide an equity return. INNKEEPERS USA: Court Issues Revised Decision on Lehman PSA ------------------------------------------------------------ Judge Shelley C. Chapman on Monday re-issued her decision denying Innkeepers USA Trust and its affiliated debtors' motion to assume a plan support agreement, dated July 17, 2010, with Lehman ALI Inc. Judge Chapman said the Debtors have not articulated a sufficient business justification for entry into the PSA. The decision was dictated on the record at the conclusion of the hearing held on September 1, 2010. It has been modified in these respects: (i) typographical and transcription errors have been corrected, (ii) full citations have been added, and (iii) defined terms have been added for the purposes of clarity. Because this decision was initially a bench decision dictated in open court and written without the benefit of more leisurely drafting, it has fewer citations and footnotes, and a more conversational tone than a memorandum decision. The ruling was first reported by the Troubled Company Reporter on September 8, 2010, citing INNKEEPERS USA Bankruptcy News. "I do not believe this is a case where a smaller group of out-of- the-money constituents is opposing the Debtors' motion in an effort to extract hold-up value from those constituents that are 'in the money,'" Judge Chapman pointed out. She explained that unlike most plan support agreements, the PSA only "locks up" roughly $200 million of the total $1.4 billion in secured debt in these cases -- the support of only one creditor among the critical mass of creditors needed to support a successful restructuring in these cases. Judge Chapman reminded Innkeepers of Judge Robert Gerber's ruling in In re Adelphia Communications Corp., 336 B.R. 610, 669-71 (Bankr. S.D.N.Y. 2006) -- a case with multiple debtors -- that the debtors, as fiduciaries, have duties to refrain from favoring or appearing to favor one or another of their estates and its creditors over another. "The Debtors have not done so here," Judge Chapman said in the Dec. 20 decision. The PSA supports a plan term sheet that provides, among other things, for Lehman to receive, in satisfaction of its secured mortgage claims of roughly $238 million in floating mortgage loan debt -- comprised of roughly $220 million in prepetition debt and an anticipated $17.5 million in DIP financing -- 100% of the issued and outstanding new shares of common stock to be issued by the reorganized Debtors. The new shares will include all equity in all 92 of the Debtors, notwithstanding that Lehman currently is secured by collateral of only 20 of the Debtors. Under the plan term sheet, the remaining property level secured lenders would receive new secured notes with a value that is not less than the value of the collateral securing their prepetition debt. The plan dictated by the PSA proposes to assign a value to those secured notes, providing Midland Loan Services, Inc., for example, with a $550 million note on account of its roughly $825 million secured claim. Objections to the PSA Motion were filed by: (i) Midland Loan Services, Inc.; (ii) the Property Level Lenders, comprised of Wells Fargo Bank, N.A., as Trustee for the registered holders of Credit Suisse First Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates, Series 2007-C1 and U.S. Bank National Association, as Trustee for the registered holders of ML-CFC Commercial Mortgage Trust 2006-4, Commercial Mortgage Pass-Through Certificates, Series 2006-4; (iii) the Ad Hoc Equity Committee of Preferred Shareholders; (iv) TriMont Real Estate Advisors, Inc.; (v) CWCapital Asset Management LLC; (vi) C-III Asset Management LLC; (vii) Five Mile Capital Partners LLC; and (viii) Appaloosa Investment L.P. I. Reservations of rights regarding the Motion were filed by Marriott International, Inc., and the Official Committee of Unsecured Creditors. Judge Chapman added, "There is a level of neutrality required; I do not believe the process leading to the PSA reflects the more even-handed approach required in this case. To be sure, the Debtors do not have to be paralyzed in an attempt to make everyone happy. If they believe the plan underlying the PSA is a good, confirmable plan, they can and should file it and prosecute it. It will either survive attacks vis-a-vis valuation, new value, substantive consolidation, and whatever else the creditor body asserts -- or it will not. And, if Lehman still wants to support the plan, it is free to do so." A full-text copy of Judge Chapman's Dec. 20 Bench Decision is available at http://is.gd/jcBqAfrom Leagle.com. LNR Partners, LLC, is represented in the case by: Lawrence P. Gottesman, Esq. BRYAN CAVE LLP 1290 Avenue of the Americas New York, NY 10104-3300 Telephone: 212-541-1193 Facsimile: 212-541-1493 E-mail: lawrence.gottesman@bryancave.com Attorneys for Lehman ALI Inc., and Michael Lascher are: Michael J. Sage, Esq. Kevin J. O'Brien, Esq. Brian E. Greer, Esq. DECHERT LLP 1095 Avenue of the Americas New York, NY 10036-6797 Telephone: 212-698-3503 Facsimile: 212-698-3599 E-mail: michael.sage@dechert.com kevin.obrien@dechert.com brian.greer@dechert.com The Ad Hoc Committee of Preferred Shareholders is represented by: Martin Bienenstock, Esq. Irena M. Goldstein, Esq. Timothy Q. Karcher, Esq. DEWEY & LEBOEUF LLP 1301 Avenue of the Americas New York, NY 10019-6092 Telephone: 212-259-8530 E-mail: mbienenstock@dl.com igoldstein@dl.com tkarcher@dl.com Midland Loan Services, Inc., is represented by: Lenard M. Parkins, Esq. HAYNES AND BOONE LLP 1221 Avenue of the Americas, 26th Floor New York, NY 10020 Telephone: 212-659-4966 713-542-7225 (Mobile) Facsimile: 212-884-8226 E-mail: lenard.parkins@haynesboone.com - and - John D. Penn, Esq. 201 Main Street, Suite 2200 Fort Worth, TX 76102 Telephone: 817-347-6610 Facsimile: 817-348-2300 E-mail: john.penn@haynesboone.com - and - Philip M. Bridwell, Esq. Mark Elmore, Esq. 2323 Victory Avenue, Suite 700 Dallas, TX 75219 Telephone: 214-651-5534 Facsimile: 214-200-0728 E-mail: philip.bridwell@haynesboone.com mark.elmore@haynesboone.com Attorneys for Five Mile Capital Partners LLC are: David M. Friedman, Esq. Adam L. Shiff, Esq. Daniel A. Fliman, Esq. KASOWITZ, BENSON, TORRES & FRIEDMAN LLP, New York, NY, 1633 Broadway New York, NY 10019 Telephone: (212) 506-1740 Facsimile: (212) 506-1800 E-mail: dfriedman@kasowitz.com ashiff@kasowitz.com dfliman@kasowitz.com TriMont Real Estate Advisors, Inc., is represented by: Todd C. Meyers, Esq. KILPATRICK STOCKTON LLP Suite 2800, 1100 Peachtree Street Atlanta, GA, 30309-4528 Telephone: 404-815-6482 Facsimile: 404-541-3307 E-mail: TMeyers@KilpatrickStockton.com The Official Committee of Unsecured Creditors is represented by: Lorenzo Marinuzzi, Esq. MORRISON & FOERSTER LLP 1290 Avenue of the Americas New York, NY 10104-0050 Telephone: (212) 468-8045 Facsimile: (212) 468-7900 E-mail: lmarinuzzi@mofo.com Apollo Investment Corporation is represented by: Alan W. Kornberg, Esq. Andrew J. Ehrlich, Esq. PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP 1285 Avenue of the Americas New York, NY 10019-6064 Telephone: 212-373-3209 Facsimile: 212-373-2053 E-mail: kornberg@paulweiss.com aehrlich@paulweiss.com Attorneys for C-III Asset Management and CWCapital Asset Management are: David M. Neff, Esq. PERKINS COIE LLP 131 South Dearborn Street, Suite 1700 Chicago, IL 60603-5559 Telephone: 312-324-8689 Facsimile: 312-324-9689 E-mail: DNeff@perkinscoie.com Attorneys for Appaloosa Investment L.P. are: Lee S. Attanasio, Esq. John G. Hutchinson, Esq. SIDLEY AUSTIN LLP 787 Seventh Avenue New York, NY 10019 Telephone: 212-839-5342 Facsimile: 212-839-5599 E-mail: lattanasio@sidley.com jhutchinson@sidley.com About Innkeepers USA Trust Innkeepers USA Trust is a self-administered Maryland real estate investment trust with a primary business focus on acquiring premium-branded upscale extended-stay, mid-priced limited service, and select-service hotels. Innkeepers, through its indirect subsidiaries, owns and operates an expansive portfolio of 72 upscale and mid-priced extended-stay and select-service hotels, consisting of approximately 10,000 rooms, located in 20 states across the United States. Apollo Investment Corporation acquired Innkeepers in June 2007. Innkeepers USA Trust and a number of affiliates filed for Chapter 11 on July 19, 2010 (Bankr. S.D.N.Y. Case No. 10-13800). Paul M. Basta, Esq., at Kirkland & Ellis LLP, in New York; Anup Sathy, P.C., Esq., Marc J. Carmel, Esq., at Kirkland & Ellis in Chicago; and Daniel T. Donovan, Esq., at Kirkland & Ellis in Washington, DC, serve as counsel to the Debtors. AlixPartners is the restructuring advisor and Marc A. Beilinson is the chief restructuring officer. Moelis & Company is the financial advisor. Omni Management Group, LLC, is the claims and notice agent. The petition estimated assets and debts of more than $1 billion as of the bankruptcy filing. In 2009, Innkeepers' consolidated revenues were approximately $292 million and adjusted EBITDA were approximately $85 million. The Company's consolidated assets for 2009 totaled approximately $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred approximately $1.29 billion of secured debt. 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 disclosed 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) INOVA TECHNOLOGY: Incurs $380,000 Net Loss in October 31 Quarter ---------------------------------------------------------------- Inova Technology Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $379,968 on $4.81 million of revenue for the three months ended Oct. 31, 2010, compared with a net loss of $1.83 million on $4.13 million of revenue for the same period a year ago. The Company's balance sheet at Oct. 31, 2010, showed $11.03 million in total assets, $16.21 million in total liabilities, and a stockholders' deficit of $5.17 million. A full-text copy of the quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?7151 About Inova Technology Based in Las Vegas, Nevada, Inova Technology, Inc. (OTC BB: INVA) -- http://www.inovatechnology.com/-- through its subsidiaries, provides information technology (IT) consulting services in the United States. It also manufactures radio frequency identification (RFID) equipment; and provides computer network solutions. The company was formerly known as Edgetech Services Inc. and changed its name to Inova Technology, Inc., in 2007. As reported in the Troubled Company Reporter on August 26, 2010, MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern, following its results for the fiscal year ended April 30, 2010. The independent auditors noted that Inova incurred losses from operations for fiscal 2010 and 2009 and has a working capital deficit as of April 30, 2010. INTEGRATED FREIGHT: Seaside 88 Discloses 9.99% Equity Stake ----------------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, Seaside 88, LP disclosed that it beneficially owns 2,644,586 shares of Integrated Freight Corporation common stock representing 9.99% of the shares outstanding. Each of Seaside 88 Advisors, LLC, William J. Ritger and Denis M. O'Donnell owns of 2,644,586 shares. The calculation of percentage of beneficial ownership was derived from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2010, as filed with the Securities and Exchange Commission on November 19, 2010, in which the Company stated that the number of shares of its common stock outstanding as of November 17, 2010 was 24,312,989 shares. The calculation includes the 2,400,000 shares purchased by Seaside in the number of shares outstanding; the aggregate number and percentage of shares shown as beneficially owned represent 9.99% of the total number of shares outstanding, or 26,712,909 shares. About Integrated Freight Integrated Freight Corporation, formerly PlanGraphics, Inc., (OTC BB: IFCR) -- http://www.integrated-freight.com/-- is a Sarasota, Florida headquartered motor freight company providing long-haul, regional and local service to its customers. The Company specializes in dry freight, refrigerated freight and haz-waste truckload services, operating primarily in well-established traffic lanes in the upper mid-West, Texas, California and the Atlantic seaboard. IFCR was formed for the purpose of acquiring and consolidating operating motor freight companies. On August 19, 2010, at a special stockholders' meeting the Company approved a reverse stock split, a relocation of its State of Incorporation to Florida and a change of its name to Integrated Freight Corporation. The Company's name change and State of Incorporation have been approved and are effective as of August 18, 2010. The reverse stock split has been approved but is not effective as of the date of this filing. * * * Sherb & Co., LLP, in Boca Raton, Fla., expressed substantial doubt about the Company's ability to continue as a going concern, following its results for the fiscal year ended March 31, 2010. The independent auditors noted that the Company has suffered recurring losses and has a negative working capital position and a stockholders' deficit. The Company's balance sheet at Sept. 30, 2010, showed $8.96 million in total assets, $11.91 million in total liabilities, and a stockholders' deficit of $2.95 million. INTEGRATED HEALTHCARE: K. Chaudhuri Discloses 77.55% Equity Stake ----------------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on December 13, 2010, Kali P. Chaudhuri, M.D., disclosed that he beneficially owns 437,601,334 shares of Integrated Healthcare Holdings, Inc. common stock representing 77.55% of the shares outstanding. The number of shares include (i) 30,600,000 shares that have been issued to Kali P. Chaudhuri, M.D. (subject to downward adjustment pursuant to a Settlement Agreement, General Release and Covenant Not to Sue dated March 25, 2009 between Kali P. Chaudhuri, M.D., the Company and certain other parties, including other stockholders of the Company, as filed with the Securities and Exchange Commission as Exhibit 10.1 to the Company's Form 8-K filed on April 7, 2009), and (ii) 309,000,000 shares underlying warrants that are exercisable by Kali P. Chaudhuri, M.D. or KPC Resolution Company, LLC within 60 days, and assume 255,307,262 shares of Company's common stock are outstanding. KPC Resolution Company, LLC also disclosed ownership of 139,000,000 shares representing 35.25% equity stake. There were 255,307,262 shares outstanding of the Company's common stock as of November 2, 2010. The Reporting Persons currently intend to acquire ownership of up to 100% of the outstanding shares of common stock of the Company. The Reporting Persons intend to negotiate with members of the Company's board of directors, management and other stockholders of the Company with regard to these matters. If the Company is not currently eligible to terminate the registration of its common stock under Section 12(g)(4) of the Exchange Act, the acquisition by the Reporting Persons of additional shares of common stock of the Company may cause the Company to become eligible to terminate such registration. If registration of the common stock of the Company under the Exchange Act is terminated, the common stock of the Company will cease to be authorized to be quoted on the OTC Bulletin Board. About Integrated Healthcare Headquartered in Santa Ana, Calif., Integrated Healthcare Holdings, Inc. (IHHI) -- http://www.ihhioc.com/-- owns and operates four acute care hospitals and ancillary health businesses in Orange County, California. The Company's balance sheet at September 30, 2010, showed $127.8 million in total assets, $172.0 million in total liabilities, and a stockholders' deficit of $44.2 million. As of September 30, 2010, the Company has a working capital deficit of $44.2 million and an accumulated deficit of $105.3 million. BDO Seidman, LLP, Costa Mesa, California, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's results for the fiscal year ended March 31, 2010. The independent auditors noted that the Company has a working capital deficit and a net stockholders' deficiency at March 31, 2010. INTERNATIONAL COAL: Sets Pricing of 40-Mil. Shares Offering ----------------------------------------------------------- International Coal Group, Inc. filed with the Securities and Exchange Commission on December 14, 2010, a free writing prospectus regarding the pricing of a registered underwritten offering of 12,268,700 and 22,577,800 shares of the Company's common stock by affiliates of each of WL Ross & Co. and Fairfax Financial Holdings Limited, respectively. The underwriter will also have the option to purchase up to an additional 1,840,305 and 3,386,670 shares of common stock from such affiliates of WL Ross & Co. and Fairfax Financial Holdings Limited, respectively, within 30 days, solely to cover over- allotments, if any. On December 13, 2010, the last sale price of the Company's common stock as reported on the New York Stock Exchange was $8.16 per share. Closing of the offering is expected to occur on or about December 17, 2010, subject to customary closing conditions. Upon completion of this offering, affiliates of WL Ross & Co. and Fairfax Financial Holdings Limited will continue to own 12,268,723 and 22,577,788 shares of the Company's common stock, respectively. Messrs. Ross and Mitchell and Ms. Teramoto will continue to serve on the Board of Directors and Mr. Ross will continue in his role as non-executive Chair of the Board of Directors. The Company will not receive any of the proceeds from the offering. The total number of shares of the Company's common stock outstanding will not change as a result of this offering. BofA Merrill Lynch acted as the sole book-running manager for the offering. The common stock will be sold by the selling stockholders pursuant to an effective shelf registration statement that was previously filed by the Company with the SEC and became effective on December 13, 2010. Copies of the preliminary prospectus supplement and related base prospectus for the offering have been filed with the SEC and are available on the SEC's website, www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by sending a request to BofA Merrill Lynch, 4 World Financial Center, New York, NY 10080, Attn: Prospectus Department or e-mailing BofA Merrill Lynch at dg.prospectus_requests@baml.com. 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. The Company's balance sheet at Sept. 30, 2010, showed $1.47 billion in total assets, $720.28 million in total liabilities, and stockholders' equity of $748.30 million. * * * International Coal Group carries 'Caa1' corporate family and probability of default ratings from Moody's Investors Service. In March 2010, Moody's said the ratings "continue to reflect ICG's elevated cost structure amidst an uncertain price environment, inherent operating risk at its mines, history of operating and financial challenges, significant capital spending requirements, and uncertainty regarding mine permitting obstacles particularly given the large percentage of surface mine production." INTERNATIONAL COAL: Files Form S-3ASR; May Sell Common Stock ------------------------------------------------------------ In an automatic shelf registration statement with the Securities and Exchange Commission on December 13, 2010, International Coal Group, Inc. disclosed that it may sell its common stock from time to time at indeterminate prices. A copy of the prospectus is available for free at http://ResearchArchives.com/t/s?714d 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. The Company's balance sheet at Sept. 30, 2010, showed $1.47 billion in total assets, $720.28 million in total liabilities, and stockholders' equity of $748.30 million. * * * International Coal Group carries 'Caa1' corporate family and probability of default ratings from Moody's Investors Service. In March 2010, Moody's said the ratings "continue to reflect ICG's elevated cost structure amidst an uncertain price environment, inherent operating risk at its mines, history of operating and financial challenges, significant capital spending requirements, and uncertainty regarding mine permitting obstacles particularly given the large percentage of surface mine production." INTERNATIONAL RECTIFIER: S&P Raises Corp. Credit Rating to 'BB-' ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it raised its corporate credit rating on U.S. power management semiconductor manufacturer International Rectifier Corp. to 'BB-' from 'B+'. The outlook is stable. S&P's rating on IR reflects the company's improving credit profile, characterized by recent consistent revenue growth and higher profitability, reflecting the recovery across the semiconductor industry, and an adequate liquidity profile. Uneven profit generation over the past two years, industry cyclicality, and IR's midtier competitive position partially offset these factors. S&P's financial risk profile for IR is significant despite credit measures currently strong for the category. S&P believes that over a cycle, there are likely to be wide fluctuations in the company's financial profile. During fiscal 2009, IR experienced periods of large revenue declines and negative EBITDA. In addition, profitability, while improving throughout the recovery, has consistently been weaker compared to its peers. Although there is currently no funded debt, the rating can accommodate both some slippage from expected near term performance when another cyclical downturn occurs and also support debt leverage of about 3x average EBITDA. INTERTAPE POLYMER: Court Cuts Jury Award to $3 Million ------------------------------------------------------ Intertape Polymer Group Inc. has received a positive ruling in the pending litigation against its subsidiary, Intertape Polymer Corp., in the case of Intertape Polymer Corp. v. Inspired Technologies, Inc. The United States District Court for the Middle District of Florida has granted Intertape's post trial motion to reduce the amount of the judgment previously awarded by the jury to ITI from $13,150,000 to $3,000,000. These amounts do not include attorney fees, costs, or prejudgment interest. As a result of the reduction of the judgment, Intertape will request a corresponding reduction in the amount of its appellate bond. "We are pleased by this ruling but not completely satisfied considering that we believe ITI's allegations to be unfounded. As such, we will appeal to the 11th Circuit Court of Appeals seeking reversal of the judgment", said the Company's President and CEO, Greg Yull. About Intertape Polymer Group Intertape Polymer Group Inc. (TSX:ITP) (NYSE:ITP) develops and manufactures specialized polyolefin plastic and paper based packaging products and complementary packaging systems for industrial and retail use. Headquartered in Montreal, Quebec and Sarasota/Bradenton, Florida, the Company employs approximately 2,100 employees with operations in 17 locations, including 13 manufacturing facilities in North America and one in Europe. * * * In August 2010, Moody's Investors Service revised the rating outlook on Intertape Polymer Group Inc. to negative from stable and affirmed the B2 Corporate Family Rating. Moody's also affirmed the SGL-3 speculative grade liquidity rating and instrument ratings. Moody's said the B2 Corporate Family Rating reflects Intertape's narrow operating margins, lack of pricing power, largely commoditized product line and reliance on cyclical end markets, such as industrial, building and construction segments. Intertape is operating in a fragmented and highly competitive industry. The presence of large competitors with significant financial resources restricts Intertape's ability to recover raw material increases from customers and constrains the rating. JAMES SHANNON: District Court Rejects Interlocutory Appeal ---------------------------------------------------------- District Judge B. Avant Edenfield dismissed James G. Shannon's appeal from an order entered by the Bankruptcy Court granting the motions to extend the time to file dischargeability complaints filed by the Morales-Arcadio and Reyes-Fuentes Creditors. The Creditors moved to dismiss the appeal on the basis that it is interlocutory, and should not be considered by the Court. Mr. Shannon's debt to the Creditors arises out of consent judgments and a security agreement entered into between the parties to settle a lawsuit in which the Creditors alleged Mr. Shannon's violation of the Fair Labor Standards Act. The Creditors claim that Mr. Shannon's debt is not dischargeable in bankruptcy, but they did not file dischargeability complaints within the prescribed 60-day period. The appellate case is James G. Shannon, Jr., v. Morales-Arcadio Creditors, Reyes-Fuentes Creditors, Case No. 10-cv-69 (S.D. Ga.), and a copy of the District Court's December 16, 2010 Order is available at http://is.gd/jccfSfrom Leagle.com. James G. Shannon filed for Chapter 11 bankruptcy (Bankr. S.D. Ga. Case No. 09-61153) on December 4, 2009. H. Lehman Franklin, Jr., Esq. -- hlfpcbankruptcy@hotmail.com -- in Statesboro, Georgia, represents the Debtor. In his petition, the Debtor estimated $1 million to $10 million in both assets and debts. JEMSEK CLINIC: Insurer's Misconduct Warrants Claim Dismissal ------------------------------------------------------------ WestLaw reports that an insurer's purposeful misconduct or reckless indifference to its disclosure obligations, in never advising the debtors or the court of the fact that the debtors' counterclaims were virtually identical to claims asserted by other health care providers in pending class litigation in which the insurer had been involved for more than four years and which was just on the verge of settling, and in allowing debtors to needlessly expend hundreds of thousands of dollars in litigating the counterclaims as time for them to opt out of the class settlement expired, only to abruptly change course once this opt- out time had passed and to raise the settlement as a bar to debtors' continued pursuit of the counterclaims in bankruptcy court, was sufficiently egregious to warrant the extreme sanction of dismissal of the insurer's claims against the debtors. However, the court could not enter judgment for the debtors based on the alleged value of the counterclaims, something which the bankruptcy court was barred on res judicata grounds from determining. Debtors could not indirectly obtain, as a sanction, a damages remedy that they were barred from obtaining on their counterclaims. In re Jemsek Clinic, P.A., --- B.R. ----, 2010 WL 5128366 (Bankr. W.D.N.C.). In 2008, the United States Court of Appeals for the Eleventh Circuit got involved in the dispute between Dr. Joseph G. Jemsek and his clinic. A copy of an unpublished decision in Thomas v. Blue Cross and Blue Shield Assoc., No. 08-15395 (11th Cir.), is available at http://is.gd/jdYhXfrom Leagle.com. Jemsek Clinic, P.A., dba Jemsek Specialty Clinic, Lyme and Related Diseases, PLLC, fka Jemsek Clinic, PLLC -- http://www.jemsekclinic.com/-- operates a center for the practice of internal medicine and infectious diseases in Huntersville, N.C. The center specializes in general infectious disease diagnosis and treatment, with a primary focus on HIV/AIDS and Lyme Disease. The debtor sought chapter 11 protection (Bankr. W.D.N.C. Case No. 06- 31766) on Oct. 25, 2006, and is represented by Travis W. Moon, Esq. -- tmoon@lawhms.com -- at Hamilton Fay Moon Stephens Steele & Martin, PLLC, in Charlotte, N.C. At the time of the filing, the Debtor estimated its assets and debts at less than $10 million. JERRY BARNETT: Court Orders Appointment of Chapter 11 Examiner -------------------------------------------------------------- The Hon. Brian D. Lynch of the U.S. Bankruptcy Court for the Western District of Washington directed the Office of the U.S. Trustee for Region 18 to appoint a Chapter 11 examiner in the case of Jerry Barnett and Katherine Barnett. Unsecured creditor Banc of America Leasing & Capital, LLC asked the Court for an appointment of an examiner explaining that the interest of all parties-in-interest will be served by the appointment of an examiner. The Chapter 11 examiner's duties will include an examination of: a) the Debtors; b) the Barnett Revocable Living Trust and any other trust, including offshore trusts, if any, in which the Debtors, or either of them, have a legal or equitable interest; c) any entity in which the Debtors, or either of them, are an affiliate, and any person that is an insider of the Debtors, or either of them; and d) all entities disclosed by the Debtors in their schedules, statements, and lists filed. The examiner may in its discretion examine any other person affecting the financial affairs of the Debtors, the Trusts, the Affiliate Entities, or the Disclosed Entities. Further, the scope of the examiner's duties will include an investigation of the subject entities': i) pre- and post-petition income and the sources thereof; ii) pre- and post-petition transfers of property; iii) current assets and the values thereof (without resort to formal appraisals); iv) current liabilities and the bases therefor; v) nature and extent of interests in property of any sort; vi) management, control, and operations; vii) cash flow, financial condition, and profitability; and viii) ability to market and sell any assets owed. The examiner will file by February 28, 2011, a written report containing findings, conclusions, and recommendations from his or her investigation. Bank of America is represented by: Brad A. Goergen, Esq. GRAHAM & DUNN PC Pier 70, 2801 Alaskan Way, Suite 300 Seattle, WA 98121-1128 Tel: (206) 624-8300 Fax: (206) 340-9599 E-mail: bgoergen@grahamdunn.com About Jerry Barnett and Katherine Barnett Gig Harbor, Washington-based Jerry Barnett and Katherine Barnett filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. W.D. Wash. Case No. 10-46062). Benjamin J. Riley, Esq., at Brian L. Budsberg PLLC, represents the Debtors. The Barnetts estimated assets and debts at $100 million to $500 million in their Chapter 11 petition. JERRY BARNETT: U.S. Trustee Unable to Form Creditors Committee -------------------------------------------------------------- The Office of the U.S. Trustee for Region 18 notified the U.S. Bankruptcy Court for the Western District of Washington that it was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of Jerry Barnett and Katherine Barnett. The U.S. Trustee explained that there were insufficient indications of willingness from the unsecured creditors to serve in the committee. Gig Harbor, Washington-based Jerry Barnett and Katherine Barnett filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. W.D. Wash. Case No. 10-46062). Benjamin J. Riley, Esq., at Brian L. Budsberg PLLC, represents the Debtors. The Barnetts estimated assets and debts at $100 million to $500 million in their Chapter 11 petition. JERRY BARNETT: Wins Nod for Brian L. Budsberg PLLC as Counsel ------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Washington has granted Jerry Barnett and Katherine Barnettpermission to employ Brian L. Budsberg, P.L.L.C, as their counsel, retroactive to the filing of the Debtors' Chapter 11 case. All compensation will be subject to Court order upon notice to creditors and a hearing. The Bankruptcy Court is satisfied that the firm represents no interest adverse to the estate and that it is a "disinterested person" as that term is defined under Sec. 101(14) of the Bankruptcy Code. The firm can be reached at: Brian L. Budsberg, Esq. BRIAN L. BUDSBERG, P.L.L.C. P.O. Box 1489 Chapter 11 Olympia, WA 98507-1489 Tel: (360) 584-9093 Fax: (360) 252-8333 Gig Harbor, Washington-based Jerry Barnett and Katherine Barnett filed for Chapter 11 bankruptcy protection on July 26, 2010 (Bankr. W.D. Wash. Case No. 10-46062). Benjamin J. Riley, Esq., at Brian L. Budsberg PLLC, represents the Debtors. The Barnetts estimated assets and debts at $100 million to $500 million in their Chapter 11 petition. JOURDAN RIVER: Regions Bank Guaranty Suit Sent to Arbitration ------------------------------------------------------------- The Court of Appeals of Louisiana, Fourth Circuit, vacated a trial court's interlocutory judgment denying relator Stephen J. Schmidt's motion for stay of court litigation pending arbitration. The Appellate Court ruled that the trial court erred as a matter of law in denying the motion to stay in order that the matter could be submitted to binding arbitration. The Appellate Court grants a stay of the proceedings pending arbitration and remand the case to the district court. On July 27, 2007, in a commercial transaction in New Orleans, Jourdan River Estates, LLC, borrowed $4.42 million from Regions Bank. In addition to the security of a mortgage or deed of trust on real estate situated in Mississippi, the bank also obtain the personal written guaranties of Mr. Schmidt and of Earl Weber, Jr. Mr. Schmidt and Mr. Weber are members of the limited liability company. After Jourdan River Estates filed Chapter 11 bankruptcy, the bank instituted suit against the two guarantors to collect the debt. The promissory note contains an agreement to submit any dispute, claim or controversy to binding arbitration; the Commercial Guaranty does not contain such an agreement. Initially, Mr. Schmidt excepted on the grounds of prematurity. He also sought a stay so that he could proceed to arbitration. The trial court overruled the exception and the motion. Mr. Schmidt argues that because Regions seeks to enforce a guaranty agreement to collect on a debt evidenced by the promissory note, which is identified with it and relied upon by the bank to collect the debt against Mr. Schmidt, the promissory note is inextricably tied to the dispute and claim, and therefore he is entitled to avail himself of its arbitration provision. The Appellate Court agrees. The case is Regions Bank, v. Earl E. Weber, Jr., et al., No. 2010- C-1169 (La. App. Ct.). Stephen J. Schmidt is represented by: Vincent J. Booth, Esq. BOOTH & BOOTH, APLC 139 North Cortez Street New Orleans, LA 70119 Regions Bank is represented by: J. Patrick Gaffney, Esq. William T. Finn, Esq. Lindsay E. Spann, Esq. CARVER, DARDEN, KORETZKY, TESSIER, FINN, BLOSSMAN & AREAUX, LLC 1100 Poydras Street, Suite 3100 New Orleans, LA 70163 Telephone: (504) 585-3835 E-mail: gaffney@carverdarden.com finn@carverdarden.com spann@carverdarden.com A copy of Judge Paul A. Bonin's Dec. 15, 2010 decision is available at http://is.gd/jdhxWfrom Leagle.com. Based in Kenner, Louisiana, Jourdan River Estates, LLC, aka Jordan River Estates, LLC, filed for Chapter 11 bankruptcy (Bankr. E.D. La. Case No. 09-13233) on September 18, 2009. Judge Jerry A. Brown presided over the case. Jan Marie Hayden, Esq. -- jhayden@hellerdraper.com -- at Heller, Draper, Hayden, Patrick & Horn, L.L.C., served as counsel. In its petition, the Debtor estimated under $50,000 in assets and $1 million to $10 million in debts. JOSEPH KWIATKOWSKI: Case Summary & 13 Largest Unsecured Creditors ----------------------------------------------------------------- Joint Debtors: Joseph Stanley Kwiatkowski dba Kwiatkowski Farms Kwiatkowski Mining Susan Eleanor Kwiatkowski 149 Ottogan Avenue Dorr, MI 49323 Bankruptcy Case No.: 10-14901 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Western District of Michigan (Grand Rapids) Judge: Jeffrey R. Hughes Debtors' Counsel: Martin L. Rogalski, Esq. MARTIN L. ROGALSKI PC 1881 Georgetown Center Jenison, MI 49428 Tel: (616) 457-4410 E-mail: court@mrogalski.com Scheduled Assets: $9,922,481 Scheduled Debts: $9,991,806 A list of the Joint Debtors' 13 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/miwb10-14901.pdf JULIE GREEN: Case Summary & 15 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Julie A. Green 6824 W. Rose Garden Lane Glendale, AZ 85308 Bankruptcy Case No.: 10-40642 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: Randolph J. Haines Debtor's Counsel: Arthur F. Stockton, Esq. STOCKTON LAW OFFICES 8655 Via De Ventura, #G200 Scottsdale, CA 85258 Tel: (866) 682-8776 Fax: (866) 207-4082 E-mail: art@stocktonlawoffices.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 15 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb10-40642.pdf KENMORE REALTY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Kenmore Realty Group LLC 6011 N. Kenmore Chicago, IL 60660 Bankruptcy Case No.: 10-55868 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: Eugene R. Wedoff Debtor's Counsel: David K. Welch, Esq. CRANE HEYMAN SIMON WELCH & CLAR 135 S. Lasalle Street, Suite 3705 Chicago, IL 60603 Tel: (312) 641-6777 Fax: (312) 641-7114 E-mail: dwelch@craneheyman.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Joseph Junkovic, manager. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Certified Window Company -- $70,000 2840 N. Central Park Avenue Chicago, IL 60618 Village of Merrionette Park -- $53,463 11720 S. Kedzi Avenue Merrionette Park, IL 60803 City of DeKalb -- $25,153 200 South Fourth Street DeKalb, IL 60115 Carpet Showcase & Supplies -- $22,328 Direct Energy Services, LLC -- $20,862 Nicor Gas -- $20,191 Schmidt, Salzman -- $19,923 ComEd -- $5,613 Waste Management Billing Department-- $3,915 Burr Pest Control Services -- $3,200 The Sherwin Williams Co. -- $3,041 Chicago Title Land Trust Company -- $2,835 Raincoat Roofing Systems, Inc. -- $2,610 Soto Carpet -- $2,500 Coinmac Susan Kalman -- $1,950 Illustratus -- $1,015 Miller Shakman & Beem -- $1,000 E&E Lawn Care -- $875 Sanford Kahn, Ltd. -- $724 Delano's Home Decorating -- $720 KENWILAGO GROUP: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Kenwilago Group, LLC fka Argonaut Midwest Holdings, LLC 422 Burk Road Highlandville, MO 65669 Bankruptcy Case No.: 10-63043 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court Western District of Missouri (Springfield) Judge: Arthur B. Federman Debtor's Counsel: Raymond I. Plaster, Esq. RAYMOND I. PLASTER, P.C. 2032 E. Kearney, Ste. 107 Springfield, MO 65803 Tel: (417) 831-6900 Fax: (417) 831-6901 E-mail: riplaster@rip-pc.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 four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/mowb10-63043.pdf The petition was signed by Karen O. Woolard, managing member. KIEBLER RECREATION: Plan Outline Hearing Set for January 4 ---------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Ohio will convene a hearing on January 4, 2011 at 1:30 p.m., to consider approval of the Disclosure Statement explaining Kiebler Recreation, LLC's Chapter 11 Plan. Objections if any, are due December 28. The Debtor will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. As reported in the Troubled Company Reporter on December 1, 2010, the Company's reorganization plan intends to pay back secured and unsecured claims. The Plan states that real property tax claim by the county of more than $1.2 million in unpaid taxes from 2008, 2009 and 2010 will be paid. Also, resort officials plan to pay the state the more than $436,000 it owes in sales tax. The money owed is a secured claim that allows the creditors to have a lien on the property for collateral. Secured creditors have the best chance of getting relief on their claim. Others secured claims include Kings Heating and Sheet Metal of Falconer, which is owed $87,891, and R.W. Larson Associates, which has a Jamestown office, is owed two claims -- $58,752 and $18,023. Altogether there is more than $30 million in secured claims against resort owner Paul Kiebler IV. As for non-secured credit claims, Mr. Kiebler has a total of $3,848,446. The unsecured creditors may receive little or no payment at all. However, deferred cash distributions will be made to those with unsecured claims. About Kiebler Recreation Peek'n Peak Resort -- http://www.pknpk.com/-- is a recreational and leisure facility. Findley Lake, New York-based Kiebler Recreation, LLC, dba Peek'n Peak Resort, filed for Chapter 11 bankruptcy protection on May 26, 2010 (Bankr. N.D. Ohio Case No. 10-15099). Robert C. Folland, Esq., at Thompson Hine LLP, represents the Debtor. The Company estimated assets and debts at $10 million to $50 million as of the Petition Date. An affiliate, Kiebler Slippery Rock, LLC, filed a separate Chapter 11 petition on September 25, 2009 (Bankr. N.D. Ohio Case No. 09- 19087). KIMPEL'S JEWELRY: Court Won't Hear Claims v. Non-Debtor Defendants ------------------------------------------------------------------ Judge Barbara Houser said the Bankruptcy Court has "related to" jurisdiction over the claims the Plaintiffs have asserted against the non-debtor defendants in the case, Bill Kimpel, Kimpel's Jewelry & Gifts, Inc., and Providential Opportunities, Inc., v. Scott Bradley Meyrowitz, Scott Meyrowitz, Inc., Meyrowitz Inc., Nutritox, LLC, and Craig Newbold, Adv. Pro. No. 10-03227 (Bankr. N.D. Tex.) Judge Houser, however, decided to abstain from hearing the claims against the non-debtor defendants in accordance with 28 U.S.C. Sec. 1334(c)(1). Judge Houser said if the Court's decision to abstain is erroneous and is reversed on appeal by final order, the Court would grant Mr. Meyrowitz's motion to dismiss the complaint. However, the Court would not grant a separate request by Mr. Newbold to dismiss the complaint based upon his contention that the claims asserted are barred by res judicata and judicial estoppel. In the suit, the Kimpel entities allege that they went into business with Messrs. Newbold and Meyrowitz -- and various entities that Mr. Meyrowitz is alleged to have controlled -- and that the various defendants failed to perform in accordance with their alleged agreements, converted cash and other items of the Kimpel entities, and engaged in various conspiracies and other fraudulent conduct. A copy of Judge Houser's December 20, 2010 Memorandum Opinion is available at http://is.gd/jcvMxfrom Leagle.com. About William Kimpel & Kimpel's Jewelry Based in Columbiana, Ohio, William R. Kimpel owns Providential Opportunities, Inc., and Kimpel's Jewelry & Gifts, Inc. Mr. Kimpel filed his own case under Chapter 7 of the Bankruptcy Code (Bankr. N.D. Ohio Case No. 05-49432) on October 15, 2005. Kimpel's Jewelry filed its Chapter 11 case on the same date (Bankr. N.D. Ohio Case No. 05-49330). Judge Kay Woods presided over the Chapter 11 case. Melody Dugic Gazda, Esq., and Richard G. Zellers, Esq., at Luckhart, Mumaw, Zellers & Robinson in Canfield, Ohio, served as Kimpel's Jewelry counsel. In Kimpel's Jewelry's petition, it estimated $1 million to $10 million in both assets and debts. Mr. Kimpel received a discharge in his case on June 15, 2006. A plan was confirmed in the Kimpel's Jewelry case on May 23, 2007. About Scott Bradley Meyrowitz Based inDallas, Texas, Scott Bradley Meyrowitz filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case No. 06-31660) on April 25, 2006. Karen Lynn Kellett, Esq., in Dallas, represented the Debtor. In his petition, the Debtor estimated less than $50,000 in assets and between $1 million to $10 million in debts. Mr. Meyrowitz confirmed a plan of reorganization on June 27, 2008. However, Mr. Meyrowitz has defaulted under its terms and has, in essence, disappeared. According to his counsel, Mr. Meyrowitz is not (i) responding to his counsel's inquiries, or (ii) following his counsel's legal advice. After a second hearing on his counsel's motion to withdraw -- at which Mr. Meyrowitz failed to appear or respond -- the Court granted the motion and authorized his counsel's withdrawal. KSJK FAMILY: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: The KSJK Family Limited Partnership 4925 Wilshire Boulevard, #102 Los Angeles, CA 90010 Tel: (213) 427-9727 Bankruptcy Case No.: 10-64069 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Debtor's Counsel: Kyungsoo Ken Park, Esq. 3600 Wilshire Boulevard, Suite 1722 Los Angeles, CA 90010 Tel: (213) 427-9727 Fax: (213) 427-9757 E-mail: kspark_law@yahoo.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 Soon Joo Kim, general partner. LEON SUGAR: Owes $1.46 Million to Top 20 Creditors -------------------------------------------------- Leon Sugar's listed $1.46 million of debts to its 20 largest unsecured creditors, including $859,000 owed from a loan from BB&T, according to fayobserver.com. Based in Fayetville, North Carolina, Leon Sugars Inc. filed for Chapter 11 bankruptcy protection on Dec. 10, 2010 (Bankr. E.D. N.C. Case No. 10-10181). Ocie F. Murray, Jr., Esq., Murray Craven & Inman LLP, represents the Debtor in its restructuring efforts. The Debtor estimated assets of between $100,000 and $500,000, and, debts of between $1 million and $10 million. LEHMAN BROTHERS: Court Issues Revised Decision on Lehman PSA ------------------------------------------------------------ Judge Shelley C. Chapman on Monday re-issued her decision denying Innkeepers USA Trust and its affiliated debtors' motion to assume a plan support agreement, dated July 17, 2010, with Lehman ALI Inc. Judge Chapman said the Debtors have not articulated a sufficient business justification for entry into the PSA. The decision was dictated on the record at the conclusion of the hearing held on September 1, 2010. It has been modified in these respects: (i) typographical and transcription errors have been corrected, (ii) full citations have been added, and (iii) defined terms have been added for the purposes of clarity. Because this decision was initially a bench decision dictated in open court and written without the benefit of more leisurely drafting, it has fewer citations and footnotes, and a more conversational tone than a memorandum decision. The ruling was first reported by the Troubled Company Reporter on September 8, 2010, citing INNKEEPERS USA Bankruptcy News. "I do not believe this is a case where a smaller group of out-of- the-money constituents is opposing the Debtors' motion in an effort to extract hold-up value from those constituents that are 'in the money,'" Judge Chapman pointed out. She explained that unlike most plan support agreements, the PSA only "locks up" roughly $200 million of the total $1.4 billion in secured debt in these cases -- the support of only one creditor among the critical mass of creditors needed to support a successful restructuring in these cases. Judge Chapman reminded Innkeepers of Judge Robert Gerber's ruling in In re Adelphia Communications Corp., 336 B.R. 610, 669-71 (Bankr. S.D.N.Y. 2006) -- a case with multiple debtors -- that the debtors, as fiduciaries, have duties to refrain from favoring or appearing to favor one or another of their estates and its creditors over another. "The Debtors have not done so here," Judge Chapman said in the Dec. 20 decision. The PSA supports a plan term sheet that provides, among other things, for Lehman to receive, in satisfaction of its secured mortgage claims of roughly $238 million in floating mortgage loan debt -- comprised of roughly $220 million in prepetition debt and an anticipated $17.5 million in DIP financing -- 100% of the issued and outstanding new shares of common stock to be issued by the reorganized Debtors. The new shares will include all equity in all 92 of the Debtors, notwithstanding that Lehman currently is secured by collateral of only 20 of the Debtors. Under the plan term sheet, the remaining property level secured lenders would receive new secured notes with a value that is not less than the value of the collateral securing their prepetition debt. The plan dictated by the PSA proposes to assign a value to those secured notes, providing Midland Loan Services, Inc., for example, with a $550 million note on account of its roughly $825 million secured claim. Objections to the PSA Motion were filed by: (i) Midland Loan Services, Inc.; (ii) the Property Level Lenders, comprised of Wells Fargo Bank, N.A., as Trustee for the registered holders of Credit Suisse First Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates, Series 2007-C1 and U.S. Bank National Association, as Trustee for the registered holders of ML-CFC Commercial Mortgage Trust 2006-4, Commercial Mortgage Pass-Through Certificates, Series 2006-4; (iii) the Ad Hoc Equity Committee of Preferred Shareholders; (iv) TriMont Real Estate Advisors, Inc.; (v) CWCapital Asset Management LLC; (vi) C-III Asset Management LLC; (vii) Five Mile Capital Partners LLC; and (viii) Appaloosa Investment L.P. I. Reservations of rights regarding the Motion were filed by Marriott International, Inc., and the Official Committee of Unsecured Creditors. Judge Chapman added, "There is a level of neutrality required; I do not believe the process leading to the PSA reflects the more even-handed approach required in this case. To be sure, the Debtors do not have to be paralyzed in an attempt to make everyone happy. If they believe the plan underlying the PSA is a good, confirmable plan, they can and should file it and prosecute it. It will either survive attacks vis-a-vis valuation, new value, substantive consolidation, and whatever else the creditor body asserts -- or it will not. And, if Lehman still wants to support the plan, it is free to do so." A full-text copy of Judge Chapman's Dec. 20 Bench Decision is available at http://is.gd/jcBqAfrom Leagle.com. LNR Partners, LLC, is represented in the case by: Lawrence P. Gottesman, Esq. BRYAN CAVE LLP 1290 Avenue of the Americas New York, NY 10104-3300 Telephone: 212-541-1193 Facsimile: 212-541-1493 E-mail: lawrence.gottesman@bryancave.com Attorneys for Lehman ALI Inc., and Michael Lascher are: Michael J. Sage, Esq. Kevin J. O'Brien, Esq. Brian E. Greer, Esq. DECHERT LLP 1095 Avenue of the Americas New York, NY 10036-6797 Telephone: 212-698-3503 Facsimile: 212-698-3599 E-mail: michael.sage@dechert.com kevin.obrien@dechert.com brian.greer@dechert.com The Ad Hoc Committee of Preferred Shareholders is represented by: Martin Bienenstock, Esq. Irena M. Goldstein, Esq. Timothy Q. Karcher, Esq. DEWEY & LEBOEUF LLP 1301 Avenue of the Americas New York, NY 10019-6092 Telephone: 212-259-8530 E-mail: mbienenstock@dl.com igoldstein@dl.com tkarcher@dl.com Midland Loan Services, Inc., is represented by: Lenard M. Parkins, Esq. HAYNES AND BOONE LLP 1221 Avenue of the Americas, 26th Floor New York, NY 10020 Telephone: 212-659-4966 713-542-7225 (Mobile) Facsimile: 212-884-8226 E-mail: lenard.parkins@haynesboone.com - and - John D. Penn, Esq. 201 Main Street, Suite 2200 Fort Worth, TX 76102 Telephone: 817-347-6610 Facsimile: 817-348-2300 E-mail: john.penn@haynesboone.com - and - Philip M. Bridwell, Esq. Mark Elmore, Esq. 2323 Victory Avenue, Suite 700 Dallas, TX 75219 Telephone: 214-651-5534 Facsimile: 214-200-0728 E-mail: philip.bridwell@haynesboone.com mark.elmore@haynesboone.com Attorneys for Five Mile Capital Partners LLC are: David M. Friedman, Esq. Adam L. Shiff, Esq. Daniel A. Fliman, Esq. KASOWITZ, BENSON, TORRES & FRIEDMAN LLP, New York, NY, 1633 Broadway New York, NY 10019 Telephone: (212) 506-1740 Facsimile: (212) 506-1800 E-mail: dfriedman@kasowitz.com ashiff@kasowitz.com dfliman@kasowitz.com TriMont Real Estate Advisors, Inc., is represented by: Todd C. Meyers, Esq. KILPATRICK STOCKTON LLP Suite 2800, 1100 Peachtree Street Atlanta, GA, 30309-4528 Telephone: 404-815-6482 Facsimile: 404-541-3307 E-mail: TMeyers@KilpatrickStockton.com The Official Committee of Unsecured Creditors is represented by: Lorenzo Marinuzzi, Esq. MORRISON & FOERSTER LLP 1290 Avenue of the Americas New York, NY 10104-0050 Telephone: (212) 468-8045 Facsimile: (212) 468-7900 E-mail: lmarinuzzi@mofo.com Apollo Investment Corporation is represented by: Alan W. Kornberg, Esq. Andrew J. Ehrlich, Esq. PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP 1285 Avenue of the Americas New York, NY 10019-6064 Telephone: 212-373-3209 Facsimile: 212-373-2053 E-mail: kornberg@paulweiss.com aehrlich@paulweiss.com Attorneys for C-III Asset Management and CWCapital Asset Management are: David M. Neff, Esq. PERKINS COIE LLP 131 South Dearborn Street, Suite 1700 Chicago, IL 60603-5559 Telephone: 312-324-8689 Facsimile: 312-324-9689 E-mail: DNeff@perkinscoie.com Attorneys for Appaloosa Investment L.P. are: Lee S. Attanasio, Esq. John G. Hutchinson, Esq. SIDLEY AUSTIN LLP 787 Seventh Avenue New York, NY 10019 Telephone: 212-839-5342 Facsimile: 212-839-5599 E-mail: lattanasio@sidley.com jhutchinson@sidley.com About Innkeepers USA Trust Innkeepers USA Trust is a self-administered Maryland real estate investment trust with a primary business focus on acquiring premium-branded upscale extended-stay, mid-priced limited service, and select-service hotels. Innkeepers, through its indirect subsidiaries, owns and operates an expansive portfolio of 72 upscale and mid-priced extended-stay and select-service hotels, consisting of approximately 10,000 rooms, located in 20 states across the United States. Apollo Investment Corporation acquired Innkeepers in June 2007. Innkeepers USA Trust and a number of affiliates filed for Chapter 11 on July 19, 2010 (Bankr. S.D.N.Y. Case No. 10-13800). Paul M. Basta, Esq., at Kirkland & Ellis LLP, in New York; Anup Sathy, P.C., Esq., Marc J. Carmel, Esq., at Kirkland & Ellis in Chicago; and Daniel T. Donovan, Esq., at Kirkland & Ellis in Washington, DC, serve as counsel to the Debtors. AlixPartners is the restructuring advisor and Marc A. Beilinson is the chief restructuring officer. Moelis & Company is the financial advisor. Omni Management Group, LLC, is the claims and notice agent. The petition estimated assets and debts of more than $1 billion as of the bankruptcy filing. In 2009, Innkeepers' consolidated revenues were approximately $292 million and adjusted EBITDA were approximately $85 million. The Company's consolidated assets for 2009 totaled approximately $1.5 billion. As of July 19, 2010, the Company and its affiliates have incurred approximately $1.29 billion of secured debt. 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 disclosed 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: LBI Gets May 9 Extension to Reject Leases ---------------------------------------------------------- The Bankruptcy Court further extended until May 9, 2011, the time within which the trustee for Lehman Brothers Inc. may assume, assign or reject LBI's executory contracts and certain unexpired leases. The order came after the Trustee certified that no party- in- interest objected to the extension request. 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 disclosed 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: Wants Lift Stay to Allow Northgate Payments ------------------------------------------------------------ Lehman Brothers Holdings Inc. and its units ask the U.S. Bankruptcy Court to modify the automatic stay to allow U.S. Specialty Insurance Company, Zurich American Insurance Company, and the Debtors' fourth and fifth level excess insurers under the Debtors'2007-2008 directors and officers liability insurance program to make payments in connection with a settlement agreement between Northgate Minerals Corporation and certain of the Debtors' current or former directors, officers, and employees. For claims made against the Individual Defendants during the period from May 16, 2007 to May 16, 2008, the Debtors purchased a primary policy from XL Specialty Insurance Company plus additional excess coverage for this period from a number of other carriers of up to $250 million in the aggregate. The excess policies include policies underwritten by U.S. Specialty and Zurich. The terms and conditions of the excess coverage are governed by the 2007-2008 Primary D&O Policy, but each excess insurer's obligations are subject to certain additional terms, such as limits of liability, and attach only after all Loss within the respective Limits of Liability of the underlying policies has been paid. As the fourth and fifth excess insurers for the Policy Period, U.S. Specialty and Zurich provide coverage of $15 million in excess of $55 million and $15 million in excess of $70 million, respectively. Confirming the Insurers' ability to make settlement payments on behalf of the Individual Defendants is in the best interests of the Debtors' estates and creditors because, among other things, the interests of the Debtors' estates, if any, in the proceeds of the Policies are expressly subordinate to the interest of the Individual Defendants. Specifically, the Policies provide that the Debtors have a right to the insurance proceeds only after the Individual Defendants are fully reimbursed for any "Loss," including defense costs and settlement payments. Thus, the Debtors assert that granting their request is unlikely to have any adverse effect on their estates and creditors. In addition, pursuant to an agreement and release, Northgate has agreed to the extinguishment of its claim filed against Lehman Brothers Holdings Inc. in the amount of $304,677,735, and to exchange mutual releases with LBHI with respect to all matters relating to such claim. 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 disclosed 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) LODGENET ENTERTAINMENT: D. Shaw Discloses 5.5% Equity Stake ----------------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on December 13, 2010, David E. Shaw disclosed that he beneficially owns 1,368,760 shares of common stock of LodgeNet Interactive Corporation representing 5.5% of the shares outstanding. The shares are composed of (i) 694,498 shares in the name of D. E. Shaw Valence Portfolios, L.L.C., (ii) 426,871 shares in the name of D. E. Shaw Oculus Portfolios, L.L.C., and (iii) 247,391 shares under the management of D. E. Shaw Investment Management, L.L.C. D.E. Shaw & Co., L.P. also owns 1,368,760 shares. At November 2, 2010, there were 25,088,164 shares outstanding of the Company's common stock, $0.01 par value. About LodgeNet Entertainment Based in Sioux Falls, South Dakota, LodgeNet Entertainment Corporation (NASDAQ:LNET) -- http://www.lodgenet.com/-- is the provider of media and connectivity services designed to meet the needs of hospitality, healthcare and other visitor and guest-based businesses. LodgeNet serves more than 1.9 million hotel rooms representing 9,300 hotel properties worldwide in addition to healthcare facilities throughout the United States. LodgeNet's services include on demand movies, games, television programming, music and information, along with subscription sports programming and high-speed Internet access. LodgeNet Entertainment Corporation owns and operates businesses under these brands: LodgeNet, LodgeNetRX, On Command and StayOnline. * * * Moody's Investor Services placed LodgeNet Entertainment Corporation's bank loan debt rating at 'B1' in April 2007. The rating still holds to date with a stable outlook. LPATH INC: Grants Pfizer Exclusive Option for iSONEP Development ---------------------------------------------------------------- Lpath Inc. has entered into an agreement providing Pfizer with an exclusive option for a worldwide license to develop and commercialize iSONEP, Lpath's lead monoclonal antibody product candidate, which is being evaluated for the treatment of wet age- related macular degeneration and other ophthalmology disorders. iSONEP is scheduled to begin a Phase 1b clinical trial in wet AMD patients with Pigment Epithelial Detachment , a complication of wet AMD, in the first quarter of 2011 and a Phase 2a clinical trial in wet AMD patients in the second quarter of 2011. Generated via Lpath's proprietary ImmuneY2TM drug-discovery platform, iSONEP is a humanized monoclonal antibody that binds and neutralizes the bioactive lipid, sphingosine-1-phosphate. Targeting S1P is a novel approach to address serious unmet medical needs in wet AMD, a condition that affects millions worldwide. In iSONEP's completed phase I trial in wet AMD patients, several subjects showed signs of biological activity, including lesion regression and complete resolution of PED. Under the terms of the agreement, Pfizer will provide Lpath with an upfront option payment of $14 million in addition to sharing the cost of the planned Phase 1b and Phase 2a trials. Following completion of the two studies, Pfizer has the right to exercise its option for worldwide rights to iSONEP for an undisclosed option fee and, if Pfizer exercises its option, Lpath will be eligible to receive development, regulatory and commercial milestone payments that could total up to $497.5 million. In addition, Lpath will be entitled to receive tiered double-digit royalties based on sales of iSONEP. As part of the agreement, Lpath has granted to Pfizer a time- limited right of first refusal for ASONEP, Lpath's product candidate that is being evaluated for the treatment of cancer. Two Phase 2a trials are currently planned to further assess ASONEP's efficacy and safety in cancer patients. "We have been impressed by Lpath's innovative approach in targeting bioactive lipids with iSONEP and the potential opportunity to significantly add to the current standards of treatment in retinal disease," said Mikael Dolsten, president of Pfizer Worldwide Research and Development. "This risk sharing collaboration is led by our External Research Unit, whose mission is to develop high-impact medicines leveraging a virtual R&D model. We look forward to building the External Research Unit's portfolio through additional innovative deals with prospective future partners," added Uwe Schoenbeck, Pfizer's VP and CSO of External R&D Innovation. "We are thrilled to partner with Pfizer, a company that has demonstrated a commitment to innovative solutions and partnerships for the development of treatments across a wide spectrum of disease," said Scott Pancoast, chief executive officer of Lpath. "As we work with the Pfizer team to advance iSONEP through the next stage of clinical development, we expect to further demonstrate the important role that bioactive lipids play in disease processes. Lpath's unique ability to generate monoclonal antibodies to these targets presents a wealth of potential opportunity for new and innovative medicines over time." About Lpath San Diego, Calif.-based Lpath, Inc. is a biotechnology company focused on the discovery and development of lipidomic-based therapeutics, an emerging field of medical science whereby bioactive lipids are targeted to treat human diseases. According to the Company's 2009 annual report on Form 10-K, Moss Adams LLP, in San Diego, Calif., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company had incurred significant cash losses from operations since inception and expects to continue to incur cash losses from operations in 2010 and beyond. At September 30, 2010, Lpath had total assets of $4,915,794, total liabilities of $5,891,142, and a stockholders' deficit of $975,348. LTAP US: Files for Chapter 11 Protection in Delaware ---------------------------------------------------- LTAP US, LLLP, formerly Life Trust Asset Pool US, LLLP, filed for Chapter 11 protection in Wilmington, Delaware, on December 22, 2010 (Bankr. D. Del. Case No. 10-14125). LTAP US, headquartered in Atlanta, Georgia, invests in, manages, and arranges for the servicing of life insurance policies. LTAP US is managed by its general partner, LT Partner, LLC, and eight limited partners. Operating since 2003, LTAP US holds 410 policies on 313 lives, with an aggregate death benefits of approximately $1.36 billion. Berlin Atlantic Capital US -- BACH -- and SLG Life Settlements LLC also provide support to the operations. SLG, a subsidiary of BACH, which is wholly owned by Berlin Atlantic Holding, is the servicer for the Policies. According to a court filing, the Debtor had assets of $358,781,430 and debts of $231,007,430 as of Sept. 30, 2010. The hearing to consider the first day motions is scheduled for December 23 at 10:00 a.m. The first day motions include a request for immediate access of cash collateral to preserve the value of the assets. $223 Million of Secured Debt The Debtor owes $222.5 million, exclusive of interest fees and expenses, to Wells Fargo Bank, N.A., and lenders under a Loan and Security Agreement, dated June 30, 2008. The debt is secured by substantially all of the Debtor's assets. The Debtor notes that the "portfolio value" of the Policies is $311,473,957, well in excess of the outstanding obligations under the Wells Fargo Agreement. Dietmar Hofmarcher, manager of LT Partner, LLC, the general partner of the Debtor, relates that the Debtor entered into the Wells Fargo Agreement in 2008 to allow the Company to continue to buy Policies, pay Premiums and ongoing expenses, and expand its portfolio. The Company expected that the loan would be paid off from a securitization of the Policies as the Company expanded, and as a consequence, the Wells Fargo Agreement was not intended to be a long term self-liquidating facility. In addition, the Company has seen less frequent Policy maturities than were originally projected and its portfolio has failed to yield forecasted returns. According to Mr. Hofmarcher, the Company has been working actively to implement a strategy for maximizing value and preserving the Company as a going concern. Since 2009, the Company has reached out to hundreds of investors to explore efforts to restructure or sell its assets. However, it became clear to the Company in 2009, that its purpose and goals for entering into the Wells Fargo Agreement would not be achieved because Wells Fargo Securities LLC, the administrative agent for the secured loan, would not accept any of the Company's proposals regarding alternatives necessary to grow its platform for the benefit of all parties. In addition to its marketing and refinancing efforts, the Company has continued to explore strategic alternatives, including seeking out new sources of debt or equity capital or the sale of substantially all of the Company's assets. Specifically, the Company has canvassed the marketplace in an effort to locate potential financial or strategic partners. To date, the Company has received no firm commitments regarding a financing or a sale but has received several positive inquiries regarding potential transactions, which the Company hopes will be brought to fruition in the near term. The Company is also continuing to explore a transaction with North Channel Bank. In addition, the Company has received a letter of intent to buyout the Prepetition Lenders at less than par -- a transaction that has been repeatedly rejected by the Prepetition Lenders. The Debtor believes that there is significant value in the Policies and has filed for Chapter 11 to preserve such value for its stakeholders. LTAP US: Case Summary & 7 Largest Unsecured Creditors ----------------------------------------------------- Debtor: LTAP US, LLLP fka Life Trust Asset Pool US, LLLP Five Concourse Parkway Suite 3100 Atlanta, GA 30328 Bankruptcy Case No.: 10-14125 Chapter 11 Petition Date: December 22, 2010 Bankruptcy Court: U.S. Bankruptcy Court District of Delaware (Delaware) Bankruptcy Judge: Peter J. Walsh Debtor's Counsel: Adam G. Landis, Esq. Kerri K. Mumford, Esq. Kimberly A. Brown, Esq. LANDIS RATH & COBB LLP 919 Market Street Suite 1800 Wilmington, DE 19801 Tel.: (302) 467-4400 Fax : (302) 467-4450 Email: landis@lrclaw.com mumford@lrclaw.com brown@lrclaw.com Total Assets: $358,781,430 as of Sept. 30, 2010 Total Debts: $231,007,430 as of Sept. 30, 2010 The petition was signed by Dietmar Hofmarcher, manager of LT Partner, LLC, the General Partner of LTAP US, LLP. Debtor's List of Seven Largest Unsecured Creditors: Entity/Person Nature of Claim Claim Amount ------------- --------------- ------------ Locke Lord Bissel & Liddell $376,057 LLP The Proscenium, Ste 190 1170 Peachtree Street NE Atlanta, GA 30309 Clifford Chance, LLP $47,181 31 West 52nd Street New York, NY 10019-6131 Life Trust Vierzehn GmbH & $12,000 Co. KG Gormannstrasse 22 10119 Berlin, Germany AVS Underwriting, LLC $1,500 Ober Kaler $1,436 21 Services, LLC $1,406 ISC $150 MAGNA ENTERTAINMENT: MID Files Business Acquisition Report ---------------------------------------------------------- MI Developments Inc. has filed a business acquisition report in respect of the previously announced transfer of certain assets of Magna Entertainment Corp. to MID effective April 30, 2010 pursuant to MEC's plan of reorganization under Chapter 11 of Title 11 of the U.S. Bankruptcy Code. The BAR will be available at http://www.sedar.com/ Based in Aurora, Ontario, Magna Entertainment Corp. is North America's largest owner and operator of horse racetracks based on revenue. The Company develops, owns and operates horse racetracks and related pari-mutuel wagering operations, including off-track betting facilities. MEC also develops, owns and operates casinos in conjunction with its racetracks where permitted by law. MEC owns and operates AmTote International, Inc., a provider of totalisator services to the pari-mutuel industry, XpressBet(R), a national Internet and telephone account wagering system, as well as MagnaBet(TM) internationally. Pursuant to joint ventures, MEC has a 50% interest in HorseRacing TV(R), a 24-hour horse racing television network, and TrackNet Media Group LLC, a content management company formed for distribution of the full breadth of MEC's horse racing content. Following its failure to meet obligations to lenders led by PNC Bank, National Association, and Wells Fargo Bank, National Association, and controlling shareholder MI Developments Inc.'s decision not to provide further financial backing, Magna Entertainment Corp. and 24 affiliates filed for Chapter 11 on March 5, 2009 (Bankr. D. Del. Lead Case No. 09-10720). Marcia L. Goldstein, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, served as the Debtors' bankruptcy counsel. Mark D. Collins, Esq., L. Katherine Good, Esq., and Maris J. Finnegan, Esq., at Richards, Layton & Finger, P.A., served as the Debtors' local counsel. Miller Buckfire & Co. LLC acted as the Debtors' investment banker and financial advisor. Kurtzman Carson Consultants LLC served as the claims and noticing agent for the Debtors. Magna Entertainment Corp. had total assets of $1.054 billion and total liabilities of $947.3 million based on unaudited consolidated financial statements as of December 31, 2008. On April 29, 2010, the Bankruptcy Court confirmed the Second Modified Third Amended Joint Plan of Magna Entertainment Corp., its affiliated Debtors, the official committee of unsecured creditors, MI Developments Inc., and MI Developments US Financing. The Debtors emerged from Bankruptcy on April 30, 2010. MALLORY-KOTZEN TIRE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Mallory-Kotzen Tire Co., Inc. dba MK Discount Tire 20 East Main Street New Rochelle, NY 10801 Bankruptcy Case No.: 10-24658 Chapter 11 Petition Date: December 20, 2010 Court: United States Bankruptcy Court Southern District of New York (White Plains) Judge: Robert D. Drain Debtor's Counsel: Arlene Gordon-Oliver, Esq. RATTET, PASTERNAK & GORDON-OLIVER, LLP 550 Mamaroneck Avenue, Suite 510 Harrison, NY 10528 Tel: (914) 381-7400 Fax: (914) 381-7406 E-mail: ago@rattetlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/nysb10-24658.pdf The petition was signed by Myron Melnikoff, president. MCCLATCHY CO: Lenders Cut Early Restrictions on Bond Retirement --------------------------------------------------------------- The McClatchy Company said that lenders have agreed to amend its credit agreement to eliminate restrictions on the early retirement of the Company's existing public bonds. As previously announced, McClatchy will repay its remaining $41.0 million of bank term loans by the end of 2010. As part of the amendment, the company has agreed to reduce its revolving credit commitments from $236.4 million to $150.8 million. The new revolving credit commitments will decline further to $125 million on June 27, 2011, and mature on July 1, 2013. McClatchy expects to have approximately $96.5 million in revolver availability upon effectiveness of the amendment after taking into account letters of credit issued under the revolving credit. Among other things, the amendment also modifies certain restrictions on investments and dividends. A full-text copy of the credit agreement is available for free at http://ResearchArchives.com/t/s?714f About The McClatchy Company Sacramento, Calif.-based The McClatchy Company (NYSE: MNI) -- http://www.mcclatchy.com/-- is the third largest newspaper company in the United States, publishing 30 daily newspapers, 43 non-dailies, and direct marketing and direct mail operations. McClatchy also operates leading local websites in each of its markets which extend its audience reach. The websites offer users comprehensive news and information, advertising, e-commerce and other services. Together with its newspapers and direct marketing products, these interactive operations make McClatchy the leading local media company in each of its premium high growth markets. McClatchy-owned newspapers include The Miami Herald, The Sacramento Bee, the Fort Worth Star-Telegram, The Kansas City Star, The Charlotte Observer, and The News & Observer (Raleigh). * * * The Troubled Company Reporter said on Feb. 15, 2010, Moody's Investors Service upgraded The McClatchy Company's Corporate Family Rating to Caa1 from Caa2, Probability of Default Rating to Caa1 from Caa2, and senior unsecured and unguaranteed note ratings to Caa2 from Caa3, concluding the review for upgrade initiated on January 27, 2010. The upgrades reflect McClatchy's improved liquidity position and reduced near-term default risk following completion of the company's refinancing, and its ability to stabilize EBITDA performance through significant cost reductions. The rating outlook is stable. Standard & Poor's Ratings Services said it raised its corporate credit on Sacramento, California-based The McClatchy Co. to 'B' from 'B-'. The upgrade reflects the significant current and expected moderation in the pace of ad revenue declines in 2010 and 2011 and improving debt leverage and discretionary cash flow. MERUELO MADDUX: Equity Holders Want Charleston Plan to Go Forward ----------------------------------------------------------------- The Official Committee of Equity Holders asks the U.S. Bankruptcy Court for the Central District of California to proceed with the confirmation process of the Chapter 11 Plan for Meruelo Maddux Properties Inc., et al., proposed by Charlestown Capital Advisors, LLC and Hartland Asset Management Corporation. As reported in the Troubled Company Reporter on December 16, 2010, the Debtor asked a bankruptcy judge to toss out a rival restructuring plan, alleging that the shareholders backing the alternative proposal do not have the cash necessary to close the deal. The equity holders explain that the Debtors and other parties can challenge the assertions made by Charlestown, only through the confirmation process. The equity holders add that if a plan truly has no opportunity to be confirmed, then the Court can exercise its discretion to stop that plan from moving forward so that the parties can focus their attention on the plans that do meet that test. The equity holders believe that Charlestown can surmount the last hurdle by either reaching agreement with another secured creditor in that class or by unimpairing the United Commercial Bank (now East West Bank) claim. The equity holders note that Charlestown reached an agreement in principle with California Bank & Trust, giving effect to the projected change in that secured creditor's vote, Charlestown will receive more than one half in number of creditors in class 1C-2A (Holders of Non-Settling Guaranty Claims) and will be short of the two-thirds in amount requirement by just 0.02%. The competing plans for Meruelo Maddux are: (1) The Company. -- The plan provides for the payment in full of all claims over time with interest. The secured claims will be paid interest only over the term of the Plan and the principal balance will be paid either through the sale of the property securing the claim or the refinance of the secured debt. PI shareholders will retain their shares in MMPI. General unsecured creditors will be paid within 30 days after the effective date with interest from the Petition Date at 5% per annum. Holders of unsecured claims will be paid in the full amount of their claims over 5 years from the effective date. (2) Lenders Legendary Investors Group No. 1 LLC and East West Bank. -- The plan's foundation is an $80 million recapitalization via a $5 million cash infusion by Legendary, conversion of about $65 million of debt to equity and a $10 million rights offering to holders of Meruelo Maddux existing common stock. East West will receive 70% to 80% of the stock of the reorganized company. Holders of unsecured claims will receive a cash payment equal to 100% of the amount of their allowed claims on the effective date, plus simple interest at 5% per annum for the period from the petition date through the date each allowed claim is paid. Interest will be at the Federal Judgment Rate if the creditors vote to reject the plan. Holders of the existing stock will receive 20% of the stock in the reorganized company. (3) Existing shareholders Charlestown Capital Advisors LLC and Hartland Asset Management Corp. -- Under the plan, MMPI will receive a $31 million cash investment from Charleston and Hartland-led investors and from a rights offering made available to existing MMPI shareholders. Non-insider general unsecured creditors will be paid in full with interest as soon as the plan becomes effective. Holders of secured claims will receive monthly interest payments at 5.25% for four years with full payment on the principal balance four years after the effective date. Reorganized MMPI will issue to existing holders of MMPI interests, if they elect to receive stock instead of cash, will receive up to 26% of the total stock of the reorganized company. Stockholders can also purchase up to 19% of the stock in an $8 million rights offering. Judge Kathleen Thompson of the U.S. Bankruptcy Court for the Central District of California in October approved competing reorganization plans from Meruelo equity holders Charlestown Capital Advisors LLC and Hartland. Judge Thompson approved the disclosure statement explaining the Chapter 11 plan proposed by management in early August. The Creditors Committee is recommending that creditors turn down the management plan. The Committee supports the lenders' plan. The Committee noted that the lenders' plan will pay creditors in full with interest shortly after plan confirmation while the company plan would pay creditors in full over five years. The Company has said that East West is taking a predatory action by converting real estate debt into a controlling interest in a company. East West also appears to be proposing it use TARP money obtained by the federal government as a part of its effort to complete its hostile takeover of Meruelo Maddux. About Meruelo Maddux Meruelo Maddux and its affiliates filed for Chapter 11 protection on March 26, 2009 (Bankr. C.D. Calif. Lead Case No. 09-13356). Aaron De Leest, Esq., John J. Bingham, Jr., Esq., and John N. Tedford, Esq., at Danning Gill Diamond & Kollitz, represent the Debtors in their restructuring effort. The Debtors' financial condition as of December 31, 2008, showed $681,769,000 in assets and $342,022,000 of debts. MESA AIR: Citicorp Assigns Claims to Refine Inc. ------------------------------------------------ The Bankruptcy Clerk recorded these claims against Mesa Air Group Inc. changing hands on December 10, 2010: Claim Amount Transferor Transferee Number Transferred ---------- ---------- ------ ----------- Citicorp North Refine, Inc., 1033 $5,000,000 America, Inc. as trustee 1034 5,000,000 1035 5,000,000 1037 5,000,000 In separate evidences of transfer, the Bankruptcy Clerk noted that Wilmington Trust Company, as mortgagee under a certain security agreement and upon direction of CIT Capital USA Inc. and Export Development Canada, transferred and assigned: * Claim No. 955 for an unknown amount, and amended Claim No. 1393 for $6,500,000 plus additional amounts that are contingent or hypothetical as of the date of the claim, to (i) to the extent of 60% of the Claims, to Wells Fargo Delaware Trust Company, National Association, and (ii) to the extent of 40% of the Claims, to CIT Capital USA Inc. * Claim No. 951 for an unknown amount and amended Claim No. 1401 for $6,500,000 plus additional amounts that are contingent or hypothetical as of the date of the claim, to (i) to the extent of 60% of the Claims, to Wells Fargo Delaware Trust Company, National Association, and (ii) to the extent of 40% of the Claims, to CIT Capital USA Inc. 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 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 to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. 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). MGM RESORTS: Board Approves Amended Company Bylaws -------------------------------------------------- On December 14, 2010, the Board of Directors of MGM Resorts International approved and adopted amendments to the Company's Bylaws, effective as of that date, adding new Sections 12 and 13 under Article I, and revising Section 12 of Article II and Section 2 of Article IX. New Sections 12 and 13 under Article I implement advance notice provisions for director nominations and other proposals and ensure that compliance with the notice procedures set forth in the Bylaws is the exclusive means for stockholders to make nominations or to submit other business at a stockholders meeting, other than proposals governed by Rule 14a-8 under the Securities Exchange Act of 1934, and as discussed below under Rule 14a-11. In the case of a proposed nomination as to which access is requested to the Company's proxy materials under Rule 14a-11 under the Securities Exchange Act, compliance with such procedures shall not be required to the extent it is not feasible to comply with both such procedures and the requirements of Rule 14a-11 or if the effectiveness of such procedures to such prospective nomination is superseded as a matter of law. Among other things, the amendments require stockholders who make proposals or give advance notice of a director nomination to disclose all ownership interests in or relating to the Company's securities and all rights to vote with respect to any security of the Company, and to provide reasonably detailed descriptions of all agreements, arrangements and understandings between proposing stockholders and other stockholders of the Company in connection with the proposed business or nomination. Revisions to Section 12 under Article II of the Bylaws amend the Company's indemnification obligations to require indemnification and advancement of expenses for any director or officer who is a party in a proceeding by reason of the fact that such person is or was a director or officer of the Company, or, while a director or officer of the Company, serves or served at the request of the Company as a director, officer, manager, member, partner, trustee, employee or agent of another entity. Among other things, the Bylaw amendments provide that if a claim for indemnification or advancement of expenses is not paid in full within 30 days after a written claim has been received by the Company, the director or officer may file suit to recover the unpaid amount of the claim, and, if successful, shall be entitled to be paid the expense of prosecuting the claim. A full-text copy of the Amended Bylaws is available for free at http://ResearchArchives.com/t/s?7150 About MGM Resorts MGM Resorts International (NYSE: MGM) -- http://www.mgmresorts.com/-- has significant holdings in gaming, hospitality and entertainment, owns and operates 15 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, Illinois and Macau. * * * As reported by the Troubled Company Reporter on October 18, 2010, Standard & Poor's Ratings Services revised its rating outlook on MGM Resorts to stable from developing. At the same time, S&P affirmed all of its existing ratings on MGM, including the 'CCC+' corporate credit rating. The 'CCC+' corporate credit rating reflects MGM's significant debt burden, S&P's expectation for meaningful declines in cash flow generation in 2010, and the company's weak liquidity position. While MGM maintains a leading presence on the Las Vegas Strip, 2010 will be another challenging year for the Strip, and prospects for a meaningful rebound in 2011 are uncertain. The recent pricing of the primary offering of common stock has bolstered liquidity; however, the company's ability to weather the current downturn and continue to service its debt obligations over the longer term relies on continued progress toward addressing its challenging debt maturity schedule, as well as a substantial rebound in cash flow generation. The TCR also reported that Fitch Ratings revised the Rating Outlook for MGM Resorts to Positive following the company's equity issuance. In addition, Fitch affirmed the Issuer Default Rating at 'CCC'. MGM's 'CCC' IDR continues to reflect a credit profile with substantial credit risk. MGM's probability of default still displays a high sensitivity to an uninterrupted recovery in the Las Vegas market, significant reliance on a favorable refinancing and capital markets environment due to its heavy debt maturity schedule, a highly leveraged balance sheet despite potential debt reduction from the equity issuance, and a weak near-term free cash profile. In addition, MGM's obligation under the CityCenter completion guarantee continues to escalate, and Fitch believes the company is currently under-investing in its properties, which will likely impact asset quality. MICHAEL PEEL: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Michael J. Peel 9176 Quartz Lane Naples, FL 34120 Bankruptcy Case No.: 10-30189 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Middle District of Florida (Ft. Myers) Judge: David H. Adams Debtor's Counsel: Elena P. Ketchum, Esq. STICHTER, RIEDEL, BLAIN & PROSSER 110 E. Madison Street, Suite 200 Tampa, FL 33602 Tel: (813) 229-0144 Fax: (813) 229-1811 E-mail: eketchum.ecf@srbp.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 creditors together with its petition. Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Stephen L. Peel 10-30190 12/20/10 MICHAEL SCOTT CHANDLER: Estrange Wife Can Pursue Divorce Suit ------------------------------------------------------------- Judge Magdeline D. Coleman granted the request of Michael Scott Chandler's estranged wife, Dolores Chandler, for relief from the automatic stay to pursue all rights and claims that she may have in equitable distribution and support in a divorce proceeding now pending in the Chester County Court of Common Pleas captioned Dolores R. Chandler v. Michael S. Chandler, Civil Action No. 04-06895. However, the Court denied her requests with regard to the sale of the real property and to the state court contempt proceeding against the Debtor. Mrs. Chandler contends that she is entitled to relief from the stay because the Debtor's bankruptcy filing was made in "bad faith," and the Debtor consented to and is subject to a Court Order in the Divorce Proceeding providing for the sale of the property at issue. Michael Scott Chandler commenced a Chapter 7 bankruptcy case (Bankr. E.D. Pa. Case No. 10-16089) on July 23, 2010. Michael H. Kaliner was appointed Chapter 7 trustee. On August 23, 2010, the Debtor converted his bankruptcy case to Chapter 11. A copy of Judge Coleman's December 17, 2010 Memorandum Opinion is available at http://is.gd/jcNG9from Leagle.com. MIDWEST PROPERTIES: Court Dismisses Chapter 11 Case --------------------------------------------------- Judge Kevin J. Carey granted the United States Trustee's request to dismiss the bankruptcy cases of Midwest Properties of Shawano, LLC, and Midwest Oil of Minnesota, LLC. The U.S. Trustee sought an order converting or dismissing the Chapter 11 cases or appointing a chapter 11 trustee for each of the Debtors. The U.S. Trustee alleges that cause exists to convert or dismiss the cases pursuant to 11 U.S.C. Sec. 1112(b) because there is (i) continuing loss to the estates and an absence of a reasonable likelihood of rehabilitation, and (ii) gross mismanagement of the estates. The U.S. Trustee also asserts an additional ground for conversion or dismissal of the Midwest Oil case under Sec. 1112(b)(4)(C), due to Midwest Oil's failure to maintain appropriate insurance on one of its properties. Fox Communities Credit Union filed a joinder to the U.S. Trustee's Motion in the Midwest Properties case. "The record before me shows that Midwest Properties and Midwest Oil are currently operating at a loss. Neither debtor has provided any evidence to demonstrate an ability to change the continuing losses to the estate nor have they demonstrated a reasonable likelihood of rehabilitation in a reasonable time. These chapter 11 filings constitute a desperate attempt by the debtors to escape perceived, but unproven, bias in their 'hometowns' and to save their properties from receivership and foreclosure, but without the demonstrable ability to reorganize," Judge Carey said. A copy of Judge Carey's December 20, 2010 Memorandum is available at http://is.gd/jcoZEfrom Leagle.com. About Midwest Properties of Shawano Midwest Properties of Shawano, LLC, is a holding company, created in 2004, and its assets consist mainly of more than 20 parcels of real property located in Shawano, Wisconsin. Seven of the properties are rented, two are in receivership, and the remaining properties are vacant. Midwest Properties has no paid employees. Naomi Isaacson, the managing member of Midwest Properties, performs management tasks for the Debtor, its parent company -- the R.C. Samanta Roy Institute of Science and Technology, Inc. -- and other affiliated companies. Midwest Properties filed a voluntary Chapter 11 bankruptcy petition in Milwaukee, Wisconsin, on July 13, 2010 (Bankr. E.D. Wis. Case No. 10-31515). The case was transferred to Wilmington, Delaware, on August 6, 2010 (Bankr. D. Del. Case No. 10-12481). The U.S. Trustee has failed to form an official committee of unsecured creditors due to insufficient interest. Bruce E. Scott, Esq. -- bscott@bevcomm.net -- in New Prague, Minn., assists the Debtor in its restructuring effort. The Debtor estimated its assets at $1 million to $10 million and its debts at $1 million to $10 million. The 2010 bankruptcy filing by Midwest Properties stayed a sheriffs sale of a property against which Fox Communities Credit Union holds a lien. About Midwest Oil Midwest Oil of Minnesota, LLC, is a holding company that was created in 2003. Its assets consist of four parcels of real property located in Minnesota. Three of the properties are commercial and one is a four-unit apartment house. Midwest Oil has no paid employees. Naomi Isaacson performs certain administrative tasks for Midwest Oil, and other people volunteer to perform other tasks. In July 2010, Midwest Oil filed a chapter 11 bankruptcy petition in the Bankruptcy Court for the District of Minnesota. The filing stayed a sheriffs sale of a property against which Vermillion State Bank holds a lien. At the behest of the U.S. Trustee for Region 12, on August 18, 2010, the Minnesota Bankruptcy Court dismissed Midwest Oil's bankruptcy case pursuant to Bankruptcy Code Sec. 1112(b)(1). Midwest Oil filed a voluntary Chapter 11 bankruptcy petition (Bankr. D. Del. 10-12771) on September 1, 2010. The U.S. Trustee has failed to form an official committee of unsecured creditors due to insufficient interest. Bruce E. Scott, Esq. -- bscott@bevcomm.net -- in New Prague, Minn., assists the Debtor in its restructuring effort. The Debtor estimated its assets at $1 million to $10 million and its debts at $1 million to $10 million. Previous Bankruptcy Filings Midwest Properties, Midwest Oil, SIST, and other affiliated companies filed voluntary Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case No. 09-10876) on March 16, 2009. The Court on September 22, 2009, entered an Order dismissing the 2009 Case. The 2009 Debtors appealed to the District Court for the District of Delaware and obtained a stay of the Dismissal Order while the appeal was pending. On May 25, 2010, the District Court affirmed the Dismissal Order. The 2009 Debtors appealed to the Court of Appeals for the Third Circuit. The 2009 Debtors' motion for a stay pending the appeal to the Third Circuit was denied by order dated June 7, 2010, of the Delaware District Court, and by order dated July 1, 2010, of the Third Circuit. Midwest Properties and Midwest Oil moved for voluntary dismissal from the appeal. By order dated August 3, 2010, the Third Circuit entered an order granting Midwest Properties' and Midwest Oil's requests for voluntary dismissal from the appeal, and providing that the appeal would continue as to the remaining 2009 Debtors. MIDWEST OIL: Court Dismisses Chapter 11 Case -------------------------------------------- Judge Kevin J. Carey granted the United States Trustee's request to dismiss the bankruptcy cases of Midwest Properties of Shawano, LLC, and Midwest Oil of Minnesota, LLC. The U.S. Trustee sought an order converting or dismissing the Chapter 11 cases or appointing a chapter 11 trustee for each of the Debtors. The U.S. Trustee alleges that cause exists to convert or dismiss the cases pursuant to 11 U.S.C. Sec. 1112(b) because there is (i) continuing loss to the estates and an absence of a reasonable likelihood of rehabilitation, and (ii) gross mismanagement of the estates. The U.S. Trustee also asserts an additional ground for conversion or dismissal of the Midwest Oil case under Sec. 1112(b)(4)(C), due to Midwest Oil's failure to maintain appropriate insurance on one of its properties. Fox Communities Credit Union filed a joinder to the U.S. Trustee's Motion in the Midwest Properties case. "The record before me shows that Midwest Properties and Midwest Oil are currently operating at a loss. Neither debtor has provided any evidence to demonstrate an ability to change the continuing losses to the estate nor have they demonstrated a reasonable likelihood of rehabilitation in a reasonable time. These chapter 11 filings constitute a desperate attempt by the debtors to escape perceived, but unproven, bias in their 'hometowns' and to save their properties from receivership and foreclosure, but without the demonstrable ability to reorganize," Judge Carey said. A copy of Judge Carey's December 20, 2010 Memorandum is available at http://is.gd/jcoZEfrom Leagle.com. About Midwest Properties of Shawano Midwest Properties of Shawano, LLC, is a holding company, created in 2004, and its assets consist mainly of more than 20 parcels of real property located in Shawano, Wisconsin. Seven of the properties are rented, two are in receivership, and the remaining properties are vacant. Midwest Properties has no paid employees. Naomi Isaacson, the managing member of Midwest Properties, performs management tasks for the Debtor, its parent company -- the R.C. Samanta Roy Institute of Science and Technology, Inc. -- and other affiliated companies. Midwest Properties filed a voluntary Chapter 11 bankruptcy petition in Milwaukee, Wisconsin, on July 13, 2010 (Bankr. E.D. Wis. Case No. 10-31515). The case was transferred to Wilmington, Delaware, on August 6, 2010 (Bankr. D. Del. Case No. 10-12481). The U.S. Trustee has failed to form an official committee of unsecured creditors due to insufficient interest. Bruce E. Scott, Esq. -- bscott@bevcomm.net -- in New Prague, Minn., assists the Debtor in its restructuring effort. The Debtor estimated its assets at $1 million to $10 million and its debts at $1 million to $10 million. The 2010 bankruptcy filing by Midwest Properties stayed a sheriffs sale of a property against which Fox Communities Credit Union holds a lien. About Midwest Oil Midwest Oil of Minnesota, LLC, is a holding company that was created in 2003. Its assets consist of four parcels of real property located in Minnesota. Three of the properties are commercial and one is a four-unit apartment house. Midwest Oil has no paid employees. Naomi Isaacson performs certain administrative tasks for Midwest Oil, and other people volunteer to perform other tasks. In July 2010, Midwest Oil filed a chapter 11 bankruptcy petition in the Bankruptcy Court for the District of Minnesota. The filing stayed a sheriffs sale of a property against which Vermillion State Bank holds a lien. At the behest of the U.S. Trustee for Region 12, on August 18, 2010, the Minnesota Bankruptcy Court dismissed Midwest Oil's bankruptcy case pursuant to Bankruptcy Code Sec. 1112(b)(1). Midwest Oil filed a voluntary Chapter 11 bankruptcy petition (Bankr. D. Del. 10-12771) on September 1, 2010. The U.S. Trustee has failed to form an official committee of unsecured creditors due to insufficient interest. Bruce E. Scott, Esq. -- bscott@bevcomm.net -- in New Prague, Minn., assists the Debtor in its restructuring effort. The Debtor estimated its assets at $1 million to $10 million and its debts at $1 million to $10 million. Previous Bankruptcy Filings Midwest Properties, Midwest Oil, SIST, and other affiliated companies filed voluntary Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case No. 09-10876) on March 16, 2009. The Court on September 22, 2009, entered an Order dismissing the 2009 Case. The 2009 Debtors appealed to the District Court for the District of Delaware and obtained a stay of the Dismissal Order while the appeal was pending. On May 25, 2010, the District Court affirmed the Dismissal Order. The 2009 Debtors appealed to the Court of Appeals for the Third Circuit. The 2009 Debtors' motion for a stay pending the appeal to the Third Circuit was denied by order dated June 7, 2010, of the Delaware District Court, and by order dated July 1, 2010, of the Third Circuit. Midwest Properties and Midwest Oil moved for voluntary dismissal from the appeal. By order dated August 3, 2010, the Third Circuit entered an order granting Midwest Properties' and Midwest Oil's requests for voluntary dismissal from the appeal, and providing that the appeal would continue as to the remaining 2009 Debtors. MIG INC: To Settle Tax Fight, Gets Two Executives Out Of Jail ------------------------------------------------------------- Dow Jones' Small Cap reports that MIG Inc. has asked a U.S. bankruptcy judge for permission to pay as much as $1 million to settle tax troubles in the Eurasian country, and bail out two imprisoned executives. Based in Charlotte, North Carolina, MIG Inc. (PINK SHEETS: MTRM, MTRMP) -- http://www.metromedia-group.com/-- through its wholly owned subsidiaries, owns interests in several communications businesses in the country of Georgia. The Company's core businesses include Magticom Ltd., a mobile telephony operator located in Tbilisi, Georgia, Telecom Georgia, a long distance telephony operator, and Telenet, which provides Internet access, data communications, voice telephony and international access services. MIG, Inc., fka Metromedia International Group, Inc., filed for Chapter 11 bankruptcy protection on June 18, 2009 (Bankr. D. Del. Case No. 09-12118). Scott D. Cousins, Esq., at Greenberg Traurig LLP, assists the Company in its restructuring efforts. Debevoise & Plimpton LLP is the Company's special corporate counsel, while Potter Anderson & Corroon LLP is the Company's special litigation counsel. The official committee of unsecured creditors of MIG, Inc., has retained Baker & McKenzie LLP as its bankruptcy counsel, nunc pro tunc to June 30, 2009. In its petition, the Company estimated US$100 million to US$500 million in assets and US$100 million to US$500 million in debts. In its formal schedules, the Company said it had assets of $54,820,681 against debts of $210,183,657. MOLECULAR INSIGHT: Looks to Secure $45 Million Equity Infusion -------------------------------------------------------------- Dow Jones' Small Cap reports that Molecular Insight Pharmaceuticals Inc. is seeking court permission to enter into a deal that would pave the way for a $45 million equity capital infusion while also opening up the Company to competing financial proposals. According to the report, the biopharmaceutical company filed a motion with the U.S. Bankruptcy Court in Manhattan seeking approval to kick off its pursuit of funding for a reorganization plan. The report relates that under Molecular Insight's proposal, Savitr Capital LLC - an existing shareholder of the company - would essentially serve as the stalking horse in a process that would allow bondholders and other stakeholders to put forth competing financial proposals or attempt to negotiate more favorable treatment from Savitr under a possible consensual plan. Molecular Insight spent much of 2010 attempting to engineer a restructuring that earned the approval of its senior secured bondholders, the company said in court papers, the report notes. About Molecular Insight Cambridge, Massachusetts-based Molecular Insight Pharmaceuticals, Inc., is a clinical-stage biopharmaceutical company that provides services on the detection and treatment of various forms of cancer and other life-threatening diseases. The Debtor disclosed $36,453,000 in total assets and $198,829,000 in total debts as of September 30, 2010. Molecular Insight filed for Chapter 11 bankruptcy protection on December 9, 2010 (Bankr. D. Mass. Case No. 10-23355). Alan L. Braunstein, Esq., at Riemer & Braunstein, LLP, serves as the Debtor's local Massachusetts counsel. Kramer Levin Naftalis & Franklin LLP serves as the Debtor's lead bankruptcy counsel. Foley & Lardner LLP is the Debtor's bankruptcy counsel. CRT Capital Group LLC is the Debtor's financial advisor. Tatum LLC, a division of SFN Professional Services LLC, is the Debtor's financial consultant. Omni Management Group, LLC, is the claims, and balloting agent. NATIONAL COAL: Delisted From NASDAQ Stock Market ------------------------------------------------ On December 15, 2010, National Coal Corp. filed a notice on Form 25 with the Securities and Exchange Commission regarding the removal of its common stock from NASDAQ Stock Market LLC. About National Coal Headquartered in Knoxville, Tenn., National Coal Corp. (Nasdaq: NCOCD) http://www.nationalcoal.com/-- through its wholly owned subsidiary, National Coal Corporation, is engaged in coal mining in East Tennessee. Currently, National Coal employs about 155 people. National Coal sells steam coal to electric utilities and industrial companies in the Southeastern United States. The Company's balance sheet as of June 30, 2010, showed $38.2 million in total assets, $55.2 million in total liabilities, and a stockholders' deficit of $17.0 million. In its Form 10-Q for the quarter ended June 30, 2010, the Company said it expects to use $500,000 to $600,000 of cash from operations per month during the remainder of 2010. The Company must raise additional equity or refinance its senior secured debt before the December 15, 2010 maturity date. "The foregoing factors raise substantial doubt about the Company's ability to continue as a going concern." NCI BUILDING: S&P Downgrades Corporate Credit Rating to 'B' ----------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its corporate credit and senior secured debt ratings on NCI Building Systems Inc. to 'B' from 'B+'. The recovery rating on the senior secured bank credit facilities remains '3', indicating its expectation that lenders can expect meaningful (50% to 70%) recovery in the event of a payment default. All ratings on NCI remain on CreditWatch with negative implications, where they were placed on Oct. 26, 2010, meaning the rating could be lowered further or affirmed following the completion of S&P's review. "The downgrade and continued CreditWatch listing reflects S&P's view that demand for metal buildings will continue to be weak through 2011 as a result of still-declining nonresidential construction activity," said Standard & Poor's credit analyst Thomas Nadramia. S&P expects that weak levels of demand will result in intense price competition among producers, which will likely result in challenged operating performance over the next several quarters for NCI. Standard & Poor's expects commercial construction to decline by about 15% in 2010 and another 7% in 2011 before stabilizing toward the end of next year. As a result, S&P believes NCI's operating earnings and EBITDA may be weaker than S&P's previous expectations, resulting in credit measures that may no longer be in-line with the new rating. NCI maintains what S&P considers to be strong liquidity at this time under its criteria, with more than $77 million of cash on hand and about $80 million of availability (as of Oct. 31, 2010) under its $125 million asset-based revolving credit facility due April 2014. Also, the company is not subject to financial ratio covenants under its bank credit facilities until the first quarter of fiscal year 2012. In resolving the CreditWatch listing, Standard & Poor's expects to meet with NCI's management to discuss its near-term operating and financial strategies given the current challenging market environment. If a downgrade were the outcome of its analysis, S&P thinks it would likely be limited to one notch given its view of the company's strong liquidity position. NET TALK.COM: Sept. 30 Balance Sheet Upside-Down by $7.09 Million ----------------------------------------------------------------- Net Talk.com, Inc., filed its annual report on Form 10-K, reporting a net loss of $6.31 million on $737,498 of revenues for the fiscal year ended September 30, 2010, compared with a net loss of $2.74 million on $115,571 of revenues for the fiscal year ended September 30, 2009. The Company's balance sheet at September 30, 2010, showed $4.81 million in total assets, $11.68 million in total liabilities, $224,968 in redeemable preferred stock, and a stockholders' deficit of $7.09 million. The Company has prepared its financial statements as a going concern. The Company has an accumulated deficit of $12.42 million as of September 30, 2010. "Revenues and profits, if any, will depend upon various factors, including whether we will be able to continue expansion of our revenue," the Company said in the filing. A full-text copy of the Form 10-K is available for free at: http://researcharchives.com/t/s?714a Based in Miami, Fla., Net Talk.com, Inc., is a telephone company, who provides, sells and supplies commercial and residential telecommunication services, including services utilizing voice over internet protocol ("VoIP") technology, session initiation protocol ("SIP") technology, wireless fidelity technology, wireless maximum technology, marine satellite services technology and other similar type technologies. NH SIMPSON: Case Summary & 8 Largest Unsecured Creditors -------------------------------------------------------- Debtor: NH Simpson Partnership 6360 Van Nuys Boulevard, Suite 200 Van Nuys, CA 91401 Tel: (818) 989-5935 Bankruptcy Case No.: 10-25909 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Central District of California (San Fernando Valley) Debtor's Counsel: William H. Brownstein, Esq. 1250 Sixth Street, Suite 205 Santa Monica, CA 90401 Tel: (310) 458-0048 Fax: (310) 576-3581 E-mail: Brownsteinlaw.bill@gmail.com Scheduled Assets: $800,000 Scheduled Debts: $1,925,150 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-25909.pdf The petition was signed by Charles Miseroy, general partner. NOVASTAR FINANCIAL: Neuberger Berman Group Has 10.2% Equity Stake ----------------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, Neuberger Berman Group LLC disclosed that it beneficially owns 2,219,059 shares of Blueknight Energy Partners, L.P., representing 10.213% of the shares outstanding. Neuberger Berman LLC owns 2,195,284 shares of common stock representing 10.10% equity stake. As of November 5, 2010, there were 21,538,462 preferred units, 21,727,724 common units and 12,570,504 subordinated units outstanding. Neuberger Berman Group LLC, through its direct and indirect subsidiary Neuberger Berman Holdings LLC, controls Neuberger Berman LLC and certain affiliated persons. By reason of the provisions of Rule 13d-3 of the Securities Exchange Act of 1934, as amended, each of Neuberger Berman Group LLC, Neuberger Berman LLC and Neuberger Berman Management LLC may be deemed to beneficially own the number of shares indicated above. Each of Neuberger Berman Group LLC, Neuberger Berman LLC, Neuberger Berman Management LLC and certain affiliated persons disclaim beneficial ownership of any of the securities covered by this statement. About Blueknight Energy Blueknight Energy Partners, L.P., (Pink Sheets: BKEP) -- http://www.bkep.com/-- provides integrated terminalling, storage, processing, gathering and transportation services for companies engaged in the production, distribution and marketing of crude oil and asphalt product. It provides services for the customers, and its only inventory consists of pipeline linefill and tank bottoms necessary to operate the assets. It has three operating segments: crude oil terminalling and storage services, crude oil gathering and transportation services, and asphalt services. On October 25, 2010, BKEP announced agreement for an affiliate of Charlesbank Capital Partners, LLC, to purchase from Vitol Holding B.V. 50% of the membership interests in the entity that controls BKEP's general partner. The change in control was consummated November 12, 2010. The Company's balance sheet at Sept. 30, 2010, showed $295.96 million in total assets, $444.02 million in current liabilities, $4.69 million in long-term payable to related parties, and a partners' deficit of $152.75 million. * * * PricewaterhouseCoopers LLP, in Tulsa, Okla., in its report on the Partnership's financial statements for the year ended December 31, 2009, expressed substantial doubt about its ability to continue as a going concern. The independent auditors noted that the Partnership has substantial long-term debt, a deficit in partners' capital, and significant litigation uncertainties. NOVELOS THERAPEUTICS: Xmark Opportunity Has 7.6% Equity Stake ------------------------------------------------------------- In a Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, Xmark Opportunity Partners, LLC disclosed that it beneficially owns 34,311,724 shares of Novelos Therapeutics, Inc. common stock representing 7.6% of the shares outstanding. Xmark Opportunity Partners, LLC is the sole member of the investment manager of Xmark Opportunity Fund, L.P., a Delaware limited partnership, and Xmark Opportunity Fund, Ltd., a Cayman Islands exempted company, and, as such, possesses the sole power to vote and the sole power to direct the disposition of all securities of Novelos Therapeutics, Inc., held by Opportunity LP and Opportunity Ltd. Opportunity Partners is also the investment manager of Xmark JV Investment Partners, LLC, a Delaware limited liability company, and, as such, possesses the sole power to vote and the sole power to direct the disposition of all securities of the Company held by JV Partners. David C. Cavalier and Mitchell D. Kaye, the Co-Managing Members of Xmark Capital Partners, LLC, the Managing Member of Opportunity Partners, share voting and dispositive power with respect to all securities beneficially owned by Opportunity Partners. As of November 30, 2010, (i) Opportunity LP held 8,057,191 common shares, $0.00001 par value per share, of the Company, (ii) Opportunity Ltd. held 15,664,806 Common Shares of the Company and (iii) JV Partners held 10,589,727 Common Shares of the Company. In addition, Opportunity LP, Opportunity Ltd. and JV Partners held warrants to respectively purchase up to 380,794, 739,008 and 507,992 Common Shares of the Company. The Xmark Warrants each contain an issuance limitation prohibiting Opportunity Partners from exercising the Xmark Warrants to the extent that such exercise would result in beneficial ownership by Opportunity Partners of more than 4.99% of the Company's Common Shares then issued and outstanding. The 4.99% Issuance Limitation may be waived by Opportunity Partners upon 61 days' prior notice to the Company. Based on information received from the Company as of November 30, 2010, there were 452,866,983 Common Shares of the Company issued and outstanding. Opportunity Partners' interest in the securities reported is limited to the extent of its pecuniary interest in Opportunity LP, Opportunity Ltd. and JV Partners, if any. About Novelos Therapeutics Newton, Mass.-based Novelos Therapeutics, Inc. (OTC BB: NVLT) -- http://www.novelos.com/-- is a biopharmaceutical company developing oxidized glutathione-based compounds for the treatment of cancer and hepatitis. The Company's balance sheet at Sept. 30, 2010, showed $3.49 million in total assets, $6.36 million in total current liabilities, $375,000 in commitments and contingencies, $13.77 million in redeemable preferred stock, and a stockholders' deficit of $17.01 million. Stockholders' deficit was $16.1 million at June 30, 2010. As reported in the Troubled Company Reporter on April 8, 2010, Stowe & Degon LLC, in Westborough, Mass., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted of the Company's continuing losses and stockholders' deficiency at December 31, 2009. NXT NUTRITIONALS: Withdraws S-1 Registration Statement ------------------------------------------------------ Pursuant to Rule 477 under the Securities Act of 1933 NXT Nutritionals Holdings, Inc. requests the withdrawal of the Company's Registration Statement on Form S-1 originally filed on April 21, 2010. The Company has elected to withdraw the S-1 Registration Statement after discussions with the Securities & Exchange Commission. No sales of the Company's common stock have been or will be made pursuant to the S-1 Registration Statement. The Company may in the future rely on Rule 155(c) for subsequent private offerings of its securities and utilize the "Safe Harbor" from integration provided by Rule 155. The Company requests that in accordance with Rule 457 (p) under the Securities Act, all fees paid to the Commission in connection with the filing of the above-captioned registration statement be credited for future use. Accordingly, the Company requests that the Commission grant an order for the withdrawal of the Registration Statement and declare the withdrawal effective as soon as possible. About NXT Nutritionals Holyoke, Mass.-based NXT Nutritionals Holdings, Inc. (OTC: NXTH) - - http://www.nxtnutritionals.com/-- through its wholly owned subsidiary NXT Nutritionals, Inc., is engaged in developing and marketing of a proprietary, patent-pending, all-natural sweetener sold under the brand name SUSTA(TM) and other food and beverage products. SUSTA(TM) is being sold as a stand-alone product and it is the common ingredient for all of the Company's products. The Company's balance sheet at Sept. 30, 2010, showed $3.13 million in total assets, $12.40 million in total liabilities, and a stockholders' deficit of $9.26 million. Berman & Company, P.A., in Boca Raton, Fla., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has a net loss of $24.0 million and net cash used in operations of $2.1 million for 2009; and has a working capital deficit of $1.5 million, and a stockholders' deficit of $3.3 million at December 31, 2009. OAKS CONSTRUCTION: Debts of Project Prompts Bankruptcy Filing ------------------------------------------------------------- Amanda Jones Hoyle at Triangle Business Journal reports that Cary, North Carolina-based Oaks Construction Co. filed for Chapter 11 to help sort out the Company's mounting debts on a project across the state. The Company listed more than 150 creditors that the company has been unable to fully reimburse over the past couple of years. Oaks Construction Company Inc. filed for Chapter 11 Bankruptcy Protection on Dec. 7, 2010 (Bankr. E.D. N.C. Case No. 10-10055). Richard D. Sparkman, Esq., at Richard D. Sparkman & Assoc., P.A., represents the Debtor. The Debtor estimated assets of less than $50,000, and debts of between $1 million and $10 million. OMNIA ALEXIS: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Omnia Alexis, LLC 633 Coleridge Avenue Palo Alto, CA 94301 Bankruptcy Case No.: 10-62953 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Northern District of California (San Jose) Judge: Charles Novack Debtor's Counsel: Charles B. Greene, Esq. LAW OFFICES OF CHARLES B. GREENE 84 W. Santa Clara Street, #770 San Jose, CA 95113 Tel: (408) 279-3518 E-mail: cbgattyecf@aol.com Scheduled Assets: $7,500,000 Scheduled Debts: $6,035,500 The list of unsecured creditors filed together with its petition does not contain any entry. The petition was signed by Manar Zarroug, managing member. OPTI CANADA: FMR LLC Discloses 2.5% Equity Stake ------------------------------------------------ In an amended Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, FMR LLC disclosed that it beneficially owns 7,091,600 shares of Opti Canada Inc. common stock representing 2.517% of the shares outstanding. Edward C. Johnson 3d also owns 7,091,600 shares. Edward C. Johnson 3d and FMR LLC, through its control of Fidelity, and the funds each has sole power to dispose of the 7,091,600 shares owned by the Funds. Members of the family of Edward C. Johnson 3d, Chairman of FMR LLC, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders' voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders' voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Edward C. Johnson 3d, Chairman of FMR LLC, has the sole power to vote or direct the voting of the shares owned directly by the Fidelity Funds, which power resides with the Funds' Boards of Trustees. Fidelity carries out the voting of the shares under written guidelines established by the Funds' Boards of Trustees. About OPTI Canada OPTI Canada Inc. is a Calgary, Alberta-based company focused on developing major oil sands projects in Canada using its proprietary OrCrude(TM) process. OPTI's common shares trade on the Toronto Stock Exchange under the symbol OPC. * * * OPTI Canada carries a 'CCC+' long-term corporate credit rating from Standard & Poor's Ratings Services. It has a 'Caa2' corporate family rating from Moody's Investors Service. "S&P base its decision to lower the ratings on the increasing financing burden associated with OPTI's debt and the widening gap between potential cash flow generation, and financing and spending obligations," said Standard & Poor's credit analyst Michelle Dathorne in August 2010, to explain S&P's downgrade of the corporate rating to 'CCC+' from 'B-'. "Our estimates of the operating cash flows necessary for the company to fund all required financing obligations and capital spending internally provide no allowances for production shortfalls or commodity-price weakness from now until 2012. This lack of financial flexibility is characteristic of a credit profile in the 'CCC' category," Ms. Dathorne added. ORCHARD BRANDS: May File Prepack Bankruptcy as Soon as Dec. 30 -------------------------------------------------------------- Bloomberg News' Jonathan Keehner and Jeffrey McCracken report that Orchard Brands may file for bankruptcy as soon as next week after efforts to sell the company outside of Chapter 11 failed, according to three people with knowledge of the plans. The sources, who asked not to be identified because the talks are private, told Bloomberg Orchard Brands is preparing to file a prearranged bankruptcy as soon as December 30. The sources also said Orchard has not paid some of its vendors this month, the people said. Sources told the Journal Orchard Brands owes lenders more than $700 million. Bloomberg relates a person familiar with the matter said on October 15 that Orchard Brands has $325 million of first- lien loans. Bloomberg relates Malon Wilkus, chief executive officer of American Capital Ltd. in Bethesda, Maryland, said at a November 30 conference that the firm held some of Orchard Brands' loans. The Troubled Company Reporter, citing Bloomberg News, reported October 18, 2010, that three people with knowledge of the situation said Golden Gate hired Moelis & Co. to find a buyer for Orchard Brands as it weighs restructuring the retailer's debt. Two sources told Bloomberg that offers may not top the more than $700 million Orchard Brands owes to lenders. Lenders are poised to take control of the retailer in a restructuring if the offers are too low, the people said. Orchard Brands is operating under a forbearance agreement with its lenders, according to the October report. About Orchard Brands Based in Beverly, Massachusetts, Orchard Brands sells clothing to people 55 and older. Orchard Brands has 17 brands including Appleseed's, Draper's & Damon's, Gold Violin, Haband and Norm Thompson. It publishes catalogs and has stores under its Appleseed's and Draper's & Damon's brands. It has annual sales of about $1 billion and earnings before interest, taxes, depreciation and amortization are about $50 million, sources said told Bloomberg. Golden Gate, a San Francisco-based private-equity firm that manages $9 billion in capital, has invested in retailers such as Express Inc., Eddie Bauer Holdings Inc. and Zale Corp. PARTNERS MUTUAL: AM Best Cuts Financial Strength Rating to 'B' -------------------------------------------------------------- A.M. Best Co. has downgraded the financial strength rating to B (Fair) from B+ (Good) and issuer credit rating to "bb" from "bbb-" of Partners Mutual Insurance Company (Partners) (Waukesha, WI). The outlook for both ratings has been revised to stable from negative. These rating actions reflect Partners' trend of deteriorating underwriting performance, elevated expense structure, declining policyholders' surplus and geographic concentration of risks that exposes it to severe weather-related events. Offsetting these negative rating factors are the company's long-standing agency relationships and strategy to improve underwriting results. PENINSULA GAMING: Moody's Reviews 'B1' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service placed all ratings of Peninsula Gaming, LLC under review for possible downgrade. The review reflects Moody's heightened concern on PGL's high leverage relative to its current B1 Corporate Family Rating and possible implications from its plan to build a $260 million casino in Kansas state which could result in more debt. These ratings were placed under review for possible downgrade: * Corporate Family Rating -- B1 * Probability of Default Rating -- B1 * $240 million senior secured notes due 2015 -- Ba2 * $305 million senior unsecured notes due 2017 -- B3 The review for possible downgrade considers Peninsula's overall weak operating performance partly due to unfavorable industry fundamentals, and Moody's escalating concern that the company will not able to reduce its debt/EBITDA towards 5.0 times, a targeted leverage needed to maintain its B1 CFR. "Peninsula's current debt/EBITDA of approximately 5.9 times (proforma Amelia Belle's run-rate estimated full year EBITDA) is high for the B1 CFR," stated Moody's lead analyst John Zhao. "The addition of Kansas Star Casino in Sumner County, KS could mean more debt in the near or medium term and PGL's financial leverage could remain well above 6.0x in the next 12-18 months." The review also incorporates potential risks associated with construction and operation of a new casino. Moody's review will assess management's plan to improve PGL's operating performance from its existing four casinos, particularly these two located in the Louisiana market which have been affected by weak gaming demand and are attributed for most of the EBITDA shortfall year to date in 2010. Additionally, Moody's review will focus on potential implication on cash flow, debt balance and liquidity from the project to the existing credit upon the company's disclosure of more detail of the Kansas casino. Ratings will likely be lowered if Moody's believe the company will not be able to reduce its financial leverage close to 5.0x. PGL is a holding company whose primary assets are equity interests in its wholly owned subsidiaries, which own and operate the Diamond Jo casino in Dubuque, Iowa, the Evangeline Downs Racetrack and Casino in St. Landry Parish, Louisiana, the Amelia Belle Casino located in Amelia, Louisiana, and the Diamond Jo Worth casino in Worth County, Iowa. Consolidated net revenues for the fiscal year ended December 31, 2009 were approximately $308 million. PETROLEUM & FRANCHISE: Plan Confirmation Hearing Set for Jan. 12 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Connecticut will convene a hearing on January 12, 2011, at 3:30 p.m., to consider the confirmation of Petroleum & Franchise Capital, LLC, and Petroleum & Franchise Funding, LLC's Plan of Reorganization. As reported in the Troubled Company Reporter on October 25, 2010, according to the Disclosure Statement, the Plan provides for (a) the continued operations of PFF as the surviving successor entity by way of corporate merger; and (b) payment in full of all holders of Allowed Claims with interest and (c) retention of Allowed Interests. Under the Plan, DZ Bank will receive with respect to the DZ Secured Claims: (i) the DZ Promissory Note, which will be issued by the Reorganized Debtor in the principal amount of the Allowed DZ Secured Claims plus any interest or other fees, subject to Bankruptcy Court approval, accrued thereon during the Chapter 11 case. DZ Bank AG Deutsche Zentral-Genossenschafts Bank, Frankfurt am Main, serves as agent and for the benefit of itself and Autobahn Funding Company, LLC. Each Holder of an Allowed General Unsecured Claim in Class 3 will receive from the Debtors quarterly cash payments of 12.5% of its Allowed Claim, commencing with the first full calendar quarter after the Effective Date and continuing until all Allowed General Unsecured Claim in Class 3 are paid in full, totaling the Allowed amount of the claim in full satisfaction, settlement, release and discharge of and in exchange for the claim. The sources of cash necessary for the Reorganized Debtor to pay Allowed Claims under the Plan will be: (a) the cash of the Reorganized Debtor on hand as of the Effective Date; (b) cash arising from the operation, ownership, maintenance, and sale of the assets owned, managed, or serviced by or at the direction of the Debtors, including, without limitation, the DZ collateral; (c) any cash generated or received by the Reorganized Debtor after the Effective Date from any other source, including, without limitation, any recoveries from the prosecution of all causes of action and revenues from new loans generated by the Reorganized Debtor as of the Effective Date. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/Petroleum&Franchise_DS.pdf About Petroleum & Franchise Danbury, Connecticut-based Petroleum & Franchise Capital, LLC, filed for Chapter 11 bankruptcy protection on June 23, 2010 (Bankr. D. Conn. Case No. 10-51465). Craig I. Lifland, Esq., and James Berman, Esq., at Zeisler and Zeisler, assist the Company in its restructuring effort. The Company estimated assets and debts at $50 million to $100 million. Petroleum & Franchise Funding, LLC, an affiliate of the Debtor, a filed separate Chapter 11 petition on June 23, 2010 (Case No. 10- 51467). The Company disclosed $66,132,915 in assets and $54,782,604 in liabilities as of the Chapter 11 filing. PLATINUM ENERGY: Eight Nominees Elected to Board of Directors ------------------------------------------------------------- On December 14, 2010, Platinum Energy Resources Inc. held its annual shareholders' meeting. At the meeting, the shareholders duly elected these individuals to the Board of Directors of the Company: * Marc Berzins has been a member of the Company's board of directors since his appointment on June 3, 2009. Mr. Berzins has been a lawyer in private practice in Edmonton, Alberta, Canada since 1969. * Mr. Tim Culp has been the Company's Chairman of the Board since the Tandem Energy Corporation acquisition in October 2007. He has been the President of Desert Productions, Inc. since December, 2009. Mr. Culp has over twenty-five years of oil and gas industry experience with over twenty years of experience in property acquisitions and development. * Mark Ghermezian has served on the Board since October 28, 2010. Mr. Ghermezian has been the President and CEO of KD Energy, LLC, an oil and gas exploration and production company, since November 2008, where he successfully restructured the company, its management team, employees, moral, and outstanding debt. Prior to his involvement with KD Energy, Mr. Ghermezian was an EVP of Business Development for IDT Corporation, the Founder, President, and CEO of XE Mobile, LLC, and the Founder, President, and CEO of Flush Media, Inc. * William Glass has been the Company's President and a member of board of directors since inception. Mr. Glass has worked in the energy industry and energy financial derivatives markets since 1996. * Bernard Lang has been a director of the Company since his appointment on July 9, 2008. Mr. Lang is a Mega Project consultant in the Oil and Gas Industry and is a graduate from the University of Birmingham and a graduate of the Harvard Business School's Advanced Management Program. Mr. Lang is currently President, Bert Lang & Associates, a mega projects and energy consulting organization. He was formally Executive Vice President Engineering & Design of Synenco Energy Inc. * Al Rahmani has been a member of our board of directors since his appointment on February 18, 2009. The Board appointed Mr. Rahmani to Interim Chief Executive Officer on March 2, 2009, replacing Mr. Kostiner as Chief Executive Officer, and named him as the CEO on April 13, 2010. * David Rahmanian has served as a director since his appointment on October 7, 2010 and as Interim Chief Operating Officer of Platinum Energy and President and Chief Operating Officer of Tandem Energy since October 28, 2010. He has a B.Sc., Masters, and PhD in Geosciences from the Colorado School of Mines and Pennsylvania State University. * Martin Walrath has served as director since October 7, 2010. He has also been with Triple Five since 1980 and has been primarily responsible for the financing activities and banking relationships of the company. He has been involved in several multi-billion dollar financings for Triple Five. Before joining Triple Five, Mr. Walrath was Senior Vice President at Mellon Bank. The shareholders also ratified the appointment of GBH CPAs P.C. as the independent auditors for the Company. About Platinum Energy Houston, Tex.-based Platinum Energy Resources, Inc. -- http://www.platenergy.com/-- is an independent oil and gas exploration and production company. The Company has approximately 37,000 acres under lease in relatively long-lived fields with well-established production histories. The properties properties are concentrated primarily in the Gulf Coast region in Texas, the Permian Basin in Texas and New Mexico, and the Fort Worth Basin in Texas. GBH CPAs, PC, in Houston, Texas, expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended December 31, 2009. The independent auditors noted that the Company has experienced significant losses since inception and is currently in default of its debt agreements. The Company has incurred significant losses, resulting in cumulative losses of $113,747,702 through September 30, 2010. At September 30, 2010, the Senior Credit Facility balance was approximately $5.15 million. The Company's current cash on hand of $2,395,820 is not adequate to satisfy the debt. Also, the Company has negative working capital of $8,168,992. Currently the Company is looking at various ways of correcting these issues, including exploring joint venture opportunities as well as a thorough analysis of our specific assets for potential divestiture. Further the Company has assets and liabilities that could be affected by unfavorable outcomes of litigation in progress. PLAYLOGIC ENTERTAINMENT: Board Accepts Resignation of CEO --------------------------------------------------------- On December 17, 2010, Playlogic Entertainment Inc. said that its board of directors has accepted the resignation of W.M. Smit as president, chief executive officer and acting chief financial officer, as per December 17, 2010. The board of directors is currently searching for a replacement. Due to this resignation, W.M. Smit has also resigned as executive member of the Company's Board of Directors with immediate effect. About Playlogic Entertainment Playlogic Entertainment, Inc. (Nasdaq OTC: PLGC.OB) -- http://www.playlogicgames.com/-- is an independent worldwide publisher of digital entertainment software for consoles, PCs, handhelds, mobile devices, and other digital media platforms. Playlogic publishes and distributes products throughout all available channels, both online and offline. Playlogic is headquartered in New York City and in Amsterdam, the Netherlands. The Company's balance sheet at March 31, 2010, showed $14.1 million in assets and $16.5 million of liabilities, for a stockholders' deficit of $2.4 million. As of March 31, 2010, the Company has an accumulated deficit of approximately $82.8 million. In July 2010 Playlogic Entertainment voluntary requested a delay of payments, 'surseance van betaling', the Dutch equivalent of Chapter 11, for its subsidiary Playlogic International N.V and wholly owned subsidiary Playlogic Game Factory B.V. Tough market conditions, late payments by large customers and the delays in projects have forced the company to seek protection under the Dutch bankruptcy laws. PRESERVE AT LINDSEY: Case Summary & 7 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: The Preserve at Lindsey Island, Inc. 22223 S. Gulfview Drive Perry, FL 32348 Bankruptcy Case No.: 10-41179 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Northern District of Florida (Tallahassee) Debtor's Counsel: Angela M. Ball, Esq. ANGELA M. BALL, P.A. 615 N. Jefferson Street Perry, FL 32347 Tel: (850) 584-8960 Fax: (850) 584-7907 E-mail: aball_law@hotmail.com Scheduled Assets: Undetermined Scheduled Debts: $1,164,507 A list of the Company's seven largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flnb10-41179.pdf The petition was signed by L.B. Clark, III, president. PRIMUS GUARANTY: Moody's Downgrades Ratings on Senior Debt to 'B3' ------------------------------------------------------------------ Moody's Investors Service has downgraded the senior unsecured debt and issuer ratings of Primus Guaranty, Ltd., to B3 from B2. The rating action reflects the company's recent decision to essentially run off its operations, ongoing share buyback program which weakens its debt service, and remaining credit risks within its credit default swaps portfolio. Mitigating the concerns are that PGL's capital resources (including embedded earnings from CDS) are likely to be in excess of its debt service requirements and expected losses on CDS book, and the short remaining life of most of its CDS exposures. Moody's also announced that it will withdraw the ratings of Primus Guaranty for business reasons. Please refer to Moody's Withdrawal Policy on moodys.com. Ratings Rationale The recent sale of Cypress Tree, a CLO manager acquired by PGL in 2009, is indicative of the firm's decision to run off its operations, at least for the time being, the rating agency said. As a result of the financial crisis, Primus Financial Product, a subsidiary of PGL, has not been able to write new CDS since 2008. The remaining CDS exposure of PFP amounted to $12 billion in notional, with $646 million, or 8%, of its single name CDS book at below investment grade or not rated, as of end-Q3 2010. Primus Guaranty's resources continue to weaken, partly due to the company's share buyback program and no dividends from its subsidiaries to date. This increases the likelihood of a potential adverse effect on its debt-servicing ability. The group started its share and debt buyback program in 2008 to opportunistically enhance shareholder value and reduce debt service. Since the program's inception, the company has spent more than $20 million in share repurchases and about $14 million on senior debt buybacks. As of end-Q3 2010, it had $33 million cash and cash equivalents, and $90.4 million 7% senior debt outstanding, due in 2036. That said Moody's notes that PFP possesses a large investment portfolio. Additionally, the company expects material future CDS premiums of about $108 million as of end-Q3 2010 from its existing CDS portfolio over an average remaining life of 2.2 years. The capital resources are expected to be used first to service its senior notes and preferred securities (totaling $224 million of par outstanding), and then to cover losses from PFP's CDS portfolio. The resources remaining after fulfilling these senior obligations may be used to pay off PGL's senior unsecured debt. Primus Guaranty, Ltd., is a publicly traded holding company based in Bermuda. It is the parent of Primus Financial Products, LLC, a credit derivatives product company that provided credit protection against credit obligations of corporate and sovereign issuers. RCG APARTMENTS: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: RCG Apartments, LLC aka Rancho Verde Apartments 631 S. Olive Street, Suite 860 Los Angeles, CA 90014 Bankruptcy Case No.: 10-64278 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Debtor's Counsel: Thomas C. Corcovelos, Esq. CORCOVELOS & FORRY LLP 1001 Sixth Street, Suite 150 Manhattan Beach, CA 90266 Tel: (310) 374-0116 Fax: (310) 318-3832 E-mail: corforlaw@corforlaw.com Scheduled Assets: $8,406,170 Scheduled Debts: $19,009,906 A list of the Company's 19 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-64278.pdf The petition was signed by Saumil Dave, president of SRP Property, Inc., manager of debtor. REFCO INC: Togut Segal Bills $136,180 for Feb.-Oct. Work -------------------------------------------------------- These professionals seek the Bankruptcy Court's allowance of their fees and reimbursement of their expenses for services rendered to Albert Togut, as Chapter 7 Trustee overseeing the liquidation of Refco LLC, for the fee period from February 1, 2010 to October 31, 2010: Professional Fees Expenses ------------ -------- -------- Togut, Segal & Segal LLP $136,180 $1,176 General Bankruptcy Counsel Bridge Associates LLC 391,378 54,881 Trustee's Financial Advisors Jenner & Block LLP 161,200 3,385 Refco Trustee's Attorney About Refco Inc. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- was a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries were members of principal U.S. and international exchanges, and were among the most active members of futures exchanges in Chicago, New York, London and Singapore. Refco was also a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco was one of the largest global clearing firms for derivatives. The Company had operations in Bermuda. The Company and 23 of its affiliates filed for Chapter 11 protection on October 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represented the Debtors in their restructuring efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its Chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on December 15, 2006. That Plan became effective on Dec. 26, 2006. Pursuant to the plan, RJM, LLC, was named plan administrator to reorganized Refco, Inc., and its affiliates, and Marc S. Kirschner as plan administrator to Refco Capital Markets, Ltd. Bankruptcy Creditors' Service, Inc., publishes Refco Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Refco Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ROCK & REPUBLIC: Seeks to Sell Intellectual Property to VF Corp. ---------------------------------------------------------------- Rock & Republic Enterprises Inc. filed a creditor-repayment plan that calls for the sale of its intellectual property to VF Corp., an apparel company that already counts Lee, Wrangler, Nautica, North Face and Vans among its brands, Dow Jones' Small Cap reports. According to the report, Rock & Republic, its unsecured creditors and VF filed the plan with the court overseeing Rock & Republic's bankruptcy case. The report relates that VF has offered $57 million for the intellectual property of Rock & Republic, an apparel maker known for its denim line. The proceeds will be used to help pay Rock & Republic's creditors. The sale and plan is subject to approval by the U.S. Bankruptcy Court in Manhattan, the report notes. In a separate court document, Dow Jones' discloses, Rock & Republic and the committee representing unsecured creditors in the company's bankruptcy case urged the court to approve a $2.3 million termination fee and a $450,000 expense reimbursement for VF if the sale transaction ultimately fails to go through. About Rock & Republic New York-based Rock & Republic Enterprises, Inc., is a wholesale and retail apparel company specializing in an avant-garde and distinctive line of clothing. Originally started in 2002 by its Chief Executive Officer, Michael Ball, primarily as an American jeans company, the Debtors have expanded their lines to include high fashion clothing for men, women and children as well as shoes, cosmetics and accessories. The Company's merchandise can be found at most high end retail stores such as Nordstrom, Neiman Marcus, Bergdorf Goodman, Bloomingdales, Lord & Taylor, Harvey Nichols and Saks Fifth Avenue, as well as in small upscale boutiques. The Company filed for Chapter 11 bankruptcy protection on April 1, 2010 (Bankr. S.D.N.Y. Case No. 10-11728). Alex Spizz, Esq., and Arthur Goldstein, Esq., at Todtman, Nachamie, Spizz & Johns, P.C., assist the Company in its restructuring effort. Manderson, Schaefer & McKinlay, LLP, is the Company's special corporate counsel. The Company estimated $50 million to $100 million in assets and $10 million to $50 million in liabilities. The Company's affiliate, Triple R, Inc., filed a separate Chapter 11 petition on April 1, 2010 (Bankr. S.D.N.Y. Case No. 10-11729). The Court has extended the Debtors' exclusive period to propose a Chapter 11 plan until November 15, 2010, and its exclusive period to solicit acceptances of that plan until January 14, 2011. Rock & Republic has said it is in talks with a newly formed entity called GR Acquisition LLC, which offered to purchase its assets for at least $33 million. ROCK & REPUBLIC: Signs Asset Purchase Agreement with VF Corp ------------------------------------------------------------ VF Corporation, Rock and Republic Enterprises and The Official Committee of Unsecured Creditors have executed an asset purchase agreement for VF Corporation to acquire the trademarks and intellectual property of Rock and Republic. VF Corporation is only acquiring the Rock and Republic brand name, not the business operations or retail stores. The agreement is subject to Bankruptcy court approval and is expected to close in Spring of 2011. Rock and Republic wishes to assure its customers that the transition over the next few months will be smooth and seamless, and that all orders will continue to be filled pursuant to their terms. When completed, the transaction will mark the first acquisition for VF's Licensed Brands group, led by David Conn, which was formed in July of 2009. About Rock & Republic New York-based Rock & Republic Enterprises, Inc., is a wholesale and retail apparel company specializing in an avant-garde and distinctive line of clothing. Originally started in 2002 by its Chief Executive Officer, Michael Ball, primarily as an American jeans company, the Debtors have expanded their lines to include high fashion clothing for men, women and children as well as shoes, cosmetics and accessories. The Company's merchandise can be found at most high end retail stores such as Nordstrom, Neiman Marcus, Bergdorf Goodman, Bloomingdales, Lord & Taylor, Harvey Nichols and Saks Fifth Avenue, as well as in small upscale boutiques. The Company filed for Chapter 11 bankruptcy protection on April 1, 2010 (Bankr. S.D.N.Y. Case No. 10-11728). Alex Spizz, Esq., and Arthur Goldstein, Esq., at Todtman, Nachamie, Spizz & Johns, P.C., assist the Company in its restructuring effort. Manderson, Schaefer & McKinlay, LLP, is the Company's special corporate counsel. The Company estimated $50 million to $100 million in assets and $10 million to $50 million in liabilities. The Company's affiliate, Triple R, Inc., filed a separate Chapter 11 petition on April 1, 2010 (Bankr. S.D.N.Y. Case No. 10-11729). The Court has extended the Debtors' exclusive period to propose a Chapter 11 plan until November 15, 2010, and its exclusive period to solicit acceptances of that plan until January 14, 2011. Rock & Republic has said it is in talks with a newly formed entity called GR Acquisition LLC, which offered to purchase its assets for at least $33 million. SANTA FE: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: Santa Fe Hospitality, LLC 10150 N. Oracle Road Oro Valley, AZ 85755 Bankruptcy Case No.: 10-40621 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court District of Arizona (Tucson) Judge: James M. Marlar Debtor's Counsel: Scott D. Gibson, Esq. GIBSON, NAKAMURA & GREEN, PLLC 2329 N. Tucson Boulevard Tucson, AZ 85716 Tel: (520) 722-2600 Fax: (520) 722-0400 E-mail: ecf@gnglaw.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 Suki Khangura, managing member. SCOTT MEYROWITZ: Court Won't Hear Claims v. Non-Debtor Defendants ----------------------------------------------------------------- Judge Barbara Houser said the Bankruptcy Court has "related to" jurisdiction over the claims the Plaintiffs have asserted against the non-debtor defendants in the case, Bill Kimpel, Kimpel's Jewelry & Gifts, Inc., and Providential Opportunities, Inc., v. Scott Bradley Meyrowitz, Scott Meyrowitz, Inc., Meyrowitz Inc., Nutritox, LLC, and Craig Newbold, Adv. Pro. No. 10-03227 (Bankr. N.D. Tex.) Judge Houser, however, decided to abstain from hearing the claims against the non-debtor defendants in accordance with 28 U.S.C. Sec. 1334(c)(1). Judge Houser said if the Court's decision to abstain is erroneous and is reversed on appeal by final order, the Court would grant Mr. Meyrowitz's motion to dismiss the complaint. However, the Court would not grant a separate request by Mr. Newbold to dismiss the complaint based upon his contention that the claims asserted are barred by res judicata and judicial estoppel. In the suit, the Kimpel entities allege that they went into business with Messrs. Newbold and Meyrowitz -- and various entities that Mr. Meyrowitz is alleged to have controlled -- and that the various defendants failed to perform in accordance with their alleged agreements, converted cash and other items of the Kimpel entities, and engaged in various conspiracies and other fraudulent conduct. A copy of Judge Houser's December 20, 2010 Memorandum Opinion is available at http://is.gd/jcvMxfrom Leagle.com. About William Kimpel & Kimpel's Jewelry Based in Columbiana, Ohio, William R. Kimpel owns Providential Opportunities, Inc., and Kimpel's Jewelry & Gifts, Inc. Mr. Kimpel filed his own case under Chapter 7 of the Bankruptcy Code (Bankr. N.D. Ohio Case No. 05-49432) on October 15, 2005. Kimpel's Jewelry filed its Chapter 11 case on the same date (Bankr. N.D. Ohio Case No. 05-49330). Judge Kay Woods presided over the Chapter 11 case. Melody Dugic Gazda, Esq., and Richard G. Zellers, Esq., at Luckhart, Mumaw, Zellers & Robinson in Canfield, Ohio, served as Kimpel's Jewelry counsel. In Kimpel's Jewelry's petition, it estimated $1 million to $10 million in both assets and debts. Mr. Kimpel received a discharge in his case on June 15, 2006. A plan was confirmed in the Kimpel's Jewelry case on May 23, 2007. About Scott Bradley Meyrowitz Based inDallas, Texas, Scott Bradley Meyrowitz filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case No. 06-31660) on April 25, 2006. Karen Lynn Kellett, Esq., in Dallas, represented the Debtor. In his petition, the Debtor estimated less than $50,000 in assets and between $1 million to $10 million in debts. Mr. Meyrowitz confirmed a plan of reorganization on June 27, 2008. However, Mr. Meyrowitz has defaulted under its terms and has, in essence, disappeared. According to his counsel, Mr. Meyrowitz is not (i) responding to his counsel's inquiries, or (ii) following his counsel's legal advice. After a second hearing on his counsel's motion to withdraw -- at which Mr. Meyrowitz failed to appear or respond -- the Court granted the motion and authorized his counsel's withdrawal. SHELBRAN INVESTMENTS: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Shelbran Investments, L. P. 12871 South Highway 475 Ocala, FL 34480 Bankruptcy Case No.: 10-10937 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court Middle District of Florida (Jacksonville) Debtor's Counsel: Robert D. Wilcox, Esq. BRENNAN, MANNA & DIAMOND, PL 800 W. Monroe Street Jacksonville, FL 32202 Tel: (904) 366-1500 Fax: (904) 366-1501 E-mail: rdwilcox@bmdpl.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Stephen R. Holgate, agent. Debtor's List of nine Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Odell Income Fund 53 Acres $3,365,000 c/o Randy Wastal San Jacinto, CA 4405 Manchester Avenue, #106 Encinitas, CA 92024 Lucky Warrior Farm & Ranch Money Lent for $275,000 Charles Underbrink Improvements to 13009 S. Highway 475 Horse Farm Ocala, FL 34480 Bank of America 2144 Villines Avenue $255,000 P.O. Box 5170 San Jacinto, CA Simi Valley, CA 93062-5170 Law Office of Kent G. Snyder -- $30,000 Weiss and Company -- $13,000 Blaine Worner Civil Engineer -- $6,000 Nadel Studio One, Inc. -- $3,000 Tutan & Tucker, LLP -- $600 Accurate Business Services -- $500 SIMON WORLDWIDE: B. Nugent Does Not Own Any Securities ------------------------------------------------------ Bradford Nugent, a director at Simon Worldwide Inc., disclosed in a Form 3 filing with the Securities and Exchange Commission on December 13, 2010, that he does not own any securities of the company. About Simon Worldwide Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) no longer has any operating business. Prior to August 2001, the Company operated as a multi-national full-service promotional marketing company, specializing in the design and development of high-impact promotional products and sales promotions. At December 31, 2009, the Company held an investment in Yucaipa AEC Associates, LLC, a limited liability company that is controlled by the Yucaipa Companies, a Los Angeles, California based investment firm. Yucaipa AEC in turn principally held an investment in the common stock of Source Interlink Companies, a direct-to-retail magazine distribution and fulfillment company in North America, and a provider of magazine information and front-end management services for retailers and a publisher of approximately 75 magazine titles. Yucaipa AEC held this investment in Source until April 28, 2009, when Source filed a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. BDO Seidman, LLP, in Los Angeles, following the Company's 2009 results, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of Company has suffered significant losses from operations, has a lack of any operating revenue and is subject to potential liquidation in connection with a recapitalization agreement. On June 11, 2008, the Company entered into an Exchange and Recapitalization Agreement with Overseas Toys, L.P., the former holder of all the outstanding shares of preferred stock of the Company, pursuant to which all the outstanding preferred stock would be converted into shares of common stock representing 70% of the shares of common stock outstanding immediately following the conversion. The Recapitalization Agreement was negotiated on the Company's behalf by the Special Committee of disinterested directors which, based in part upon the opinion of the Special Committee's financial advisor, determined that the transaction was fair to the holders of common stock from a financial point of view. In connection with the Recapitalization Agreement, and in the event that the Company does not consummate a business combination by the later of (i) December 31, 2010, or (ii) December 31, 2011, in the event that a letter of intent, an agreement in principle or a definitive agreement to complete a business combination was executed on or prior to December 31, 2010, but the business combination was not consummated prior to such time, and no qualified offer have been previously consummated, the officers of the Company will take all such action necessary to dissolve and liquidate the Company as soon as reasonably practicable. SIMON WORLDWIDE: Overseas Toys Has 82.5% Equity Stake ----------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on December 10, 2010, Overseas Toys, L.P. disclosed that it beneficially owns 41,763,668 shares of common stock of Simon Worldwide, Inc. representing 82.5% of the shares outstanding. At November 12, 2010, 50,611,879 shares of the Company's common stock were outstanding. Each of Ronald W. Burkle, OA3, LLC and Multi-Accounts, LLC owns 41,763,668 shares. The previously reported Qualified Offer expired at 5:00 p.m., New York City time, on December 2, 2010. According to BNY Mellon Shareowner Services, the depositary for the Qualified Offer, a total of 3,822,912 shares of Common Stock were validly tendered, representing, in the aggregate, 7.6% of the outstanding shares of Common Stock(1) and 30.2% of the outstanding shares of Common Stock not previously owned by Overseas Toys. On December 10, 2010, Overseas Toys paid $1,032,186 for the 3,822,912 shares of Common Stock validly tendered and not withdrawn pursuant to the Qualified Offer. About Simon Worldwide Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) no longer has any operating business. Prior to August 2001, the Company operated as a multi-national full-service promotional marketing company, specializing in the design and development of high-impact promotional products and sales promotions. At December 31, 2009, the Company held an investment in Yucaipa AEC Associates, LLC, a limited liability company that is controlled by the Yucaipa Companies, a Los Angeles, California based investment firm. Yucaipa AEC in turn principally held an investment in the common stock of Source Interlink Companies, a direct-to-retail magazine distribution and fulfillment company in North America, and a provider of magazine information and front-end management services for retailers and a publisher of approximately 75 magazine titles. Yucaipa AEC held this investment in Source until April 28, 2009, when Source filed a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. BDO Seidman, LLP, in Los Angeles, following the Company's 2009 results, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that of Company has suffered significant losses from operations, has a lack of any operating revenue and is subject to potential liquidation in connection with a recapitalization agreement. On June 11, 2008, the Company entered into an Exchange and Recapitalization Agreement with Overseas Toys, L.P., the former holder of all the outstanding shares of preferred stock of the Company, pursuant to which all the outstanding preferred stock would be converted into shares of common stock representing 70% of the shares of common stock outstanding immediately following the conversion. The Recapitalization Agreement was negotiated on the Company's behalf by the Special Committee of disinterested directors which, based in part upon the opinion of the Special Committee's financial advisor, determined that the transaction was fair to the holders of common stock from a financial point of view. In connection with the Recapitalization Agreement, and in the event that the Company does not consummate a business combination by the later of (i) December 31, 2010, or (ii) December 31, 2011, in the event that a letter of intent, an agreement in principle or a definitive agreement to complete a business combination was executed on or prior to December 31, 2010, but the business combination was not consummated prior to such time, and no qualified offer have been previously consummated, the officers of the Company will take all such action necessary to dissolve and liquidate the Company as soon as reasonably practicable. SMART-TEK SOLUTIONS: B. Bonar Does Not Own Any Securities --------------------------------------------------------- In an amended Schedule 13D filing with the Securities and Exchange Commission on December 14, 2010, Brian Bonar, president/director at Smart-Tek Solutions, Inc., disclosed that he does not beneficially own any shares of the company. Mr. Bonar cancelled the 45 million shares of Smart-Tek Solutions Inc. previously issued as a result of the amending of the marketing partner agreement between Mr. Bonar and the Company on December 9, 2010. The purpose of the amendment was to clarify the basis for which shares for compensation are to be issued to Mr. Bonar. Based on the new terms, Mr. Bonar has not earned any shares as of December 13, 2010. About Smart-tek Solutions Newport Beach, Calif.-based Smart-tek Solutions Inc. has two business lines. Through its wholly owned subsidiary Smart-Tek Communications Inc. the Company specializes in the design and development of Radio Frequency Identification (RFID) integration, monitoring and tracking solutions to meet industry demands. Through its wholly owned subsidiary Smart-Tek Automated Services Inc. the Company provides professional employer organization services. John Kinross-Kennedy, of Irvine, California, expressed substantial doubt about the Company's ability to continue as a going concern. Mr. Kinross-Kennedy noted that that the Company has suffered recurring losses until the latest fiscal year, and has a working capital deficiency of $994,278 and a stockholders' deficiency of $438,164 at June 30, 2010. STEPHEN PEEL: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Stephen Lawrence Peel 2323 Tarpon Road Naples, FL 34102 Bankruptcy Case No.: 10-30190 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Middle District of Florida (Ft. Myers) Judge: David H. Adams Debtor's Counsel: Elena P. Ketchum, Esq. STICHTER, RIEDEL, BLAIN & PROSSER 110 E. Madison Street, Suite 200 Tampa, FL 33602 Tel: (813) 229-0144 Fax: (813) 229-1811 E-mail: eketchum.ecf@srbp.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 creditors together with its petition. Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Michael J. Peel 10-30189 12/20/10 SYRACUSE RESORT: Filed for Bankruptcy to Block Seizure ------------------------------------------------------ Tim Knauss at The Post-Standard reports that Syracuse Resort LLC filed for Chapter 11 protection just as city officials were about to seize the property for non-payment of property taxes. In a letter sent Oct. 13, that Assessor John Gamage had given the company until Dec. 20, 2010, to pay more than $1.25 million in back taxes or the city would take steps to seize the property. Now payment of the back taxes will be up to a bankruptcy judge. A person with knowledge of the matter said Syracuse Resort has paid no property taxes since buying the SDC property in May 2008, notes Mr. Knauss. Syracuse Resort LLC dba Syracuse Resort Development owns the former Syracuse Developmental Center. The Company filed for Chapter 11 bankruptcy protection (Bankr. E.D. N.Y. Case No.: 10- 79601). Judge Robert E. Grossman presides the case. James O. Guy, Esq., represents the Debtor. The Debtor estimated both assets and debts of between $1 million and $10 million. T&M AVIATION: Has Green Light to Sell Chopper $50,000 Cash ---------------------------------------------------------- Judge Robert Summerhays authorizes T&M Aviation Inc. to sell a Bell OH-58A Helicopter, N38FA, Serial #70-15448, to B&S Air, Inc. of Eufaula, Alabama, for $50,000 cash. Located in Abbeville, Louisiana, T&M Aviation, Inc., specializes in serving customers throughout the United States with precision aerial application and related aviation services with a modern fleet of helicopters. T&M Aviation filed for Chapter 11 bankruptcy protection (Bankr. W.D. La. Case No. 10-51520) on September 29, 2010. Louis M. Phillips, Esq. -- lphillips@gordonarata.com -- and Ryan James Richmond, Esq. -- rrichmond@gordonarata.com -- at Gordon Arata McCollam Duplantis & Eagan LLP, in Baton Rouge, serve as the Debtor's counsel. In its petition, the Debtor estimated $1 million to $10 million in assets and debts. TEGRANT CORP: S&P Puts 'CCC' Rating on CreditWatch Positive ----------------------------------------------------------- Standard & Poor's Ratings Services said that it placed its ratings on Dekalb, Ill.-based Tegrant Corp., including the 'CCC' corporate credit rating, on CreditWatch with positive implications. "The rating actions reflect Tegrant's improved earnings generation following significant restructuring actions through the recession," said Standard & Poor's credit analyst Ket Gondha. The CreditWatch with positive implications indicates the potential for an upgrade, subject to a review of Tegrant's improved earnings prospects, liquidity, operating strategy, and financial policies. With trailing annual sales of about $350 million as of June 30, 2010, Tegrant is a leading manufacturer and designer of protective, temperature-assurance, and retail packaging products for a range of primarily North American markets. As of Sept. 30, 2010, Tegrant's funds from operations to total adjusted debt ratio was 9.9%. Standard & Poor's will monitor Tegrant's earnings outlook, and S&P expects to resolve the CreditWatch when further information is available within the next 90 days. TIGRENT INC: No Longer Target of Investigation by DOJ ----------------------------------------------------- On December 11, 2006, Tigrent Inc. received a subpoena from the Department of Justice requesting documents and information in connection with an investigation relating to its marketing activities since January 1, 2002. The Company was notified at that time that a grand jury investigation related to the matter had commenced. Neither the Company nor its subsidiaries, nor any of the Company's present or former directors or officers, had been charged in any indictment. The Company received a letter, dated December 10, 2010, notifying it that the DOJ no longer considered the Company a target or a subject of a current investigation in the Eastern District of Virginia. About Tigrent Inc. Cape Coral, Fla.-based Tigrent Inc. (OTC BB: TIGE) -- http://www.tigrent.com/-- is a provider of practical, high- quality and value-based training, conferences, publications, technology-based tools and mentoring to help customers become financially literate. The Company provides customers with comprehensive instruction and mentoring in the topics of real estate and financial instruments investing and entrepreneurship in the United States, the United Kingdom, and Canada. The Company's balance sheet as of June 30, 2010, showed $43.8 million in total assets, $80.7 million in total liabilities, and a stockholders' deficit of $36.9 million. In its Form 10-Q report for the quarter ended June 30, 2010, the Company said it continues to incur a negative cash flow -- totaling $5.9 million for the period ending June 30, 2010 -- due to the on-going challenges with sales of products. "We have insufficient working capital to meet operating needs, raising substantial doubt about the ability of the Company to continue as a going concern," the Company said. In addition to the shift in strategic emphasis from live course offerings to digitally-delivered programs, the Company said it continues to implement reductions in staff to align with anticipated sales level, decreased occupancy costs, and reduced operating costs in all areas. The Company is also in current discussions with some of larger creditors to negotiate amounts owed. The Company said it if cannot generate the required revenues to sustain operations or obtain additional capital on acceptable terms, it will need to substantially revise its business plan, file for bankruptcy, sell assets or cease operations and investors could suffer the loss of a significant portion or all of their investment in the Company. TOUSA INC: Citicorp Wants Committee's Plan Outline Disapproved -------------------------------------------------------------- Citicorp North America, Inc., asks the U.S. Bankruptcy Court for the Southern District of Florida, to deny approval of the Disclosure Statement for Joint Plan of Liquidation of TOUSA, Inc., as proposed by Official Committee of Unsecured Creditors. Citicorp is the administrative agent under (i) the Second Amended and Restated Revolving Credit Agreement, as amended at various times, by and amongst TOUSA, Inc., et al., and the lender parties thereto; and (ii) the First Lien Term Loan Credit Agreement, dated as of July 31, 2007, by and amongst the Debtors and the lender parties thereto. Citicorp explains that the Committee's Disclosure Statement (i) describes an unconfirmable plan and (ii) fails to provide ?adequate information? as required by Bankruptcy Code section 1125. The Committee Plan is unconfirmable for several reasons, including, without limitation, -- it denies the First Lien Lenders and other defendants in the Committee Action due process by impermissibly mooting the Judgment Appeals; -- fails to provide the revolver lenders with voting rights, despite the fact that they are receiving only a fraction of what they are owed; -- to the extent that the revolver lenders are to receive a distribution, the Committee Plan inequitably restricts that distribution to TOUSA, Inc. assets; and -- the Committee Plan violates the First Lien Lenders' constitutional rights by (i) depriving them of the value of certain claims without compensation and (ii) depriving them of property rights without due process. Additionally, Citicorp relates that the filing of the Committee Plan violates the good faith requirements of Section 1129(a)(3) of the Bankruptcy Code. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on January 29, 2008 (Bankr. S.D. Fla. Case No. 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. TOWNSENDS INC: Organizational Meeting to Form Panel on Dec. 29 -------------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on December 29, 2010, at 12:00 p.m. in the bankruptcy case of Townsends, Inc., et al. The meeting will be held at J. Caleb Boggs Federal Building, 844 King Street, Room 5209, Wilmington, DE 19801. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Founded in 1891, Townsends Inc. fka Townsend Speciality Foods is a third-generation, family-owned poultry company. Townsends claims to be a leading producer and marketer of quality, value added poultry products to the foodservice and retail grocery markets throughout the world. Headquartered in Georgetown, Delaware, Townsends operates, directly or through its four wholly-owned subsidiaries, production and processing facilities in Arkansas and North Carolina. As of December 8, 2010, Townsend had approximately 3,017 employees. Townsends filed for Chapter 11 bankruptcy protection on December 19, 2010 (Bankr. D. Del. Case No. 10-14092). In its Chapter 11 petition, Townsends, Inc., estimated assets of $10 million to $50 million and debts of $50 million to $100 million. Affiliates Townsend Farms, Inc (Bankr. D. Del. Case No. 10-14093), Townsends of Arkansas, Inc. (Bankr. D. Del. Case No. 10-14094), Townsend Farms of Arkinsas, Inc. (Bankr. D. Del. Case No. 10- 14095), and CrestwoodFamrs LLC (Bankr. D. Del. Case No. 10-14096) filed separate Chapter 11 petitions. The Debtors disclosed $131 million in total assets and $127 million in total debts as of December 5, 2010. Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell, serves as the Debtors' bankruptcy counsel. McKenna Long & Aldridge LLP serves as the Debtors' special counsel. Donlin Recano is the Debtors' claims agent. TWAIN CONDOMINIUMS: Files for Bankruptcy to Avoid Foreclosure ------------------------------------------------------------- Steve Green at Las Vegas Sun reports that Twain Condominiums LLC filed for Chapter 11 bankruptcy protection to block a foreclosure sale planned by City National Bank. According to Las Vegas Sun, City National Bank loaned the Company $20.37 million in 2006 for the purchase of the property, rehabilitating it and converting the apartments to condominiums. The construction loan agreement was revised in March 2009 with a new principal balance of $11.4 million. But a dispute emerged between the company and the bank when City National demanded payment of $1.77 million under a "remargin" provision in the loan contract. "The debtor believes that the value of the collateral is more than the amounts due and owing to CNB under the loan revision agreement as of the petition date," the report quotes Las Vegas law firm Gordon Silver, attorney of the Company. A meeting of creditors is set for Jan. 20, 2010. Twain Condominiums LLC owns 192 condominium units within the 254- unit Twain Estates condominium complex at Arville Street and Twain Avenue. The Company filed for bankruptcy on Dec. 15, 2010 (Bankr. D. Nev. Case No. 10-33323). Judge Linda B. Riegle presides the case. Thomas H. Fell, Esq., at Gordon Silver Attorneys and Counselors at Law, represents the Debtor. The Debtor estimated both assets and debts of between $10 million and $50 million in its petition. UNI-PIXEL INC: Morgan Stanley Discloses 1.2% Equity Stake --------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, Morgan Stanley disclosed that it beneficially owns 362,718 shares of common stock of Morgans Hotel Group Co. representing 1.2% of the shares outstanding. Morgan Stanley Investment Management Inc. also owns 354,074 shares representing 1.2% equity stake. The number of shares outstanding of the Company's common stock, par value $0.01 per share, as of November 8, 2010 was 30,243,380. About Morgans Hotel Group Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) -- http://www.morganshotelgroup.com/-- is widely credited as the creator of the first "boutique" hotel and a continuing leader of the hotel industry's boutique sector. Morgans Hotel Group operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and Shore Club in South Beach, Mondrian in Los Angeles and South Beach, Clift in San Francisco, Ames in Boston, and Sanderson and St Martins Lane in London. Morgans Hotel Group and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans Hotel Group also manages hotels in Isla Verde, Puerto Rico and Playa del Carmen, Mexico. Morgans Hotel Group has other property transactions in various stages of completion, including projects in SoHo, New York and Palm Springs, California. The Company's balance sheet at Sept. 30, 2010, showed $759.10 million in total assets, $801.22 million in total liabilities, and a stockholders' deficit of $42.12 million. Morgans Hotel's forbearance agreements with the lenders which hold the mortgage loans secured by its Hudson and Mondrian Los Angeles hotels were extended until October 12, 2010. The loans are comprised of a $217.0 million first mortgage secured by the Hudson and a $120.5 million first mortgage loan secured by the Mondrian Los Angeles. U.S. ACQUISITIONS: Case Summary & 7 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: U.S. Acquisitions & Oil, Inc. 902 North Market Street, Suite 704 Wilmington, DE 19801 Tel: (302) 887-0917 Bankruptcy Case No.: 10-14121 Chapter 11 Petition Date: December 21, 2010 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Debtor's Counsel: Rebekah M. Nett, Esq. WESTVIEW LAW CENTER, PLC 1303 South Frontage Road, Suite 1 Hastings, MN 55033 Tel: (651) 437-3100 Fax: (651) 846-6414 E-mail: rnett@westviewlaw.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 seven largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/deb10-14121.pdf The petition was signed by Naomi Isaacson, president. Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Midwest Properties of Shawano, LLC. 10-12481 07/13/10 USEC INC: FMR LLC Discloses 5.419% Equity Stake ----------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on December 10, 2010, FMR LLC disclosed that it beneficially owns 6,385,460 shares of USEC Inc. common stock representing 5.419% of the shares outstanding. Edward C. Johnson 3d also owns 6,385,460 shares. As of October 15, 2010, there were 114,441,455 shares of Common Stock issued and outstanding. The ownership of one investment company, Fidelity Low-Priced Stock Fund, amounted to 6,107,226 shares or 5.183% of the Common Stock outstanding. Edward C. Johnson 3d and FMR LLC, through its control of Fidelity, and the funds each has sole power to dispose of the 6,107,226 shares owned by the Funds. Members of the family of Edward C. Johnson 3d, Chairman of FMR LLC, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders' voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders' voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Edward C. Johnson 3d, Chairman of FMR LLC, has the sole power to vote or direct the voting of the shares owned directly by the Fidelity Funds, which power resides with the Funds' Boards of Trustees. Fidelity carries out the voting of the shares under written guidelines established by the Funds' Boards of Trustees. Pyramis Global Advisors, LLC, an indirect wholly-owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940, is the beneficial owner of 277,685 shares or 0.236% of the outstanding Common Stock of USEC Incorporated as a result of its serving as investment adviser to institutional accounts, non-U.S. mutual funds, or investment companies registered under Section 8 of the Investment Company Act of 1940 owning such shares. The number of shares of Common Stock of USEC Incorporated owned by the institutional account at November 30, 2010 included 277,685 shares of Common Stock resulting from the assumed conversion of $3,320,000 principal amount of USEC INC CONV 3% 10/01/14 (83.64 shares of Common Stock for each $1,000 principal amount of debenture). Edward C. Johnson 3d and FMR LLC, through its control of PGALLC, each has sole dispositive power over 277,685 shares and sole power to vote or to direct the voting of 277,685 shares of Common Stock owned by the institutional accounts or funds advised by PGALLC. Pyramis Global Advisors Trust Company, an indirect wholly-owned subsidiary of FMR LLC and a bank as defined in Section 3(a)(6) of the Securities Exchange Act of 1934, is the beneficial owner of 549 shares or 0.000% of the outstanding Common Stock of the USEC Incorporated as a result of its serving as investment manager of institutional accounts owning such shares. Edward C. Johnson 3d and FMR LLC, through its control of Pyramis Global Advisors Trust Company, each has sole dispositive power over 549 shares and sole power to vote or to direct the voting of 0 shares of Common Stock owned by the institutional accounts managed by PGATC. About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- supplies enriched uranium fuel for commercial nuclear power plants. * * * USEC Inc. carries 'Caa1' corporate and probability of default ratings, with "developing" outlook, from Moody's, and 'CCC+' long term foreign issuer credit rating and 'CCC-' long term local issuer credit rating, with outlook "developing", from Standard & Poor's. In May 2010, S&P said that its rating and outlook on USEC Inc. are not affected by the announcement that Toshiba Corp. and Babcock & Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co., have signed a definitive investment agreement for $200 million with USEC. VISTA RIDGE: 10th Cir. BAP Grants Homeowners an Admin. Claim ------------------------------------------------------------ The United States Bankruptcy Appellate Panel for the Tenth Circuit affirmed a bankruptcy court order granting the motion by Vista Ridge Association, Inc., a homeowners' association for Vista Ridge properties, to treat its claim against Vista Ridge Development, LLC as an administrative expense pursuant to 11 U.S.C. Sec. 503(b)(1)(A). The Debtor took an appeal from the bankruptcy court order. The three-man panel before the BAP consisted of Bankruptcy Judges Terrence L. Michael (N.D. Okla.), William T. Thurman (D. Utah), and Dana L. Rasure (N.D. Okla.). Judge Thurman wrote the Opinion. A copy of the BAP's Opinion dated December 20, 2010, is available at http://is.gd/jcinnfrom Leagle.com. Vista Ridge Development, LLC, is a builder and developer that is creating a subdivision of homes within a planned luxury community near Erie, Colorado called "Vista Ridge." The Debtor purchased 139 lots of Vista Ridge property in 2005, and has since completed 39 homes on those properties. The Debtor filed a voluntary Chapter 11 petition (Bankr. D. Colo. Case No. 09-37789) on December 31, 2009. Garry R. Appel, Esq. -- appelg@appellucas.com -- in Denver, serves as the Debtor's counsel. In its schedules, the Company disclosed assets of $5,046,339 and debts of $6,786,430. The Debtor listed the HOA as a secured creditor on Schedule D of its petition, with a listed claim of $120,678.96. The Debtor's exit plan proposed on March 30, 2010, provided that the HOA would retain any liens securing its claim on each parcel, and that the assessments on each parcel would be paid in full, with interest, upon its sale. The Debtor proposed to pay the HOA, upon each closing, the total assessments applicable to that property, whether incurred pre- or post-petition, plus interest. The HOA filed a motion to treat its postpetition assessments as administrative expenses and to have them immediately paid on April 8, 2010. The Debtor objected. VITAMIN SHOPPE: Moody's Raises Corporate Family Rating to 'B1' -------------------------------------------------------------- Moody's Investors Service raised the corporate family, probability of default, and secured notes ratings of Vitamin Shoppe Industries, Inc., to B1 from B2 based on expectations for continued improvement in credit metrics due to both debt reduction and strong performance driven by same store sales growth. Vitamin Shoppe's solid growth throughout a period of weak consumer spending also supports the upgrade. The outlook is stable, and a summary of the actions is: Vitamin Shoppe Industries, Inc., -- Senior Secured Bonds, Upgraded to B1, LGD4, 54%, from B2, LGD4, 50% -- Probability of Default Rating, Upgraded to B1 from B2 -- Corporate Family Rating, Upgraded to B1 from B2 -- Outlook, Stable Ratings Rationale Vitamin Shoppe's B1 corporate family rating incorporates its focus on improving its credit profile, which Moody's expects to continue. Nevertheless, lease adjusted leverage will likely remain fairly high (estimated to be in the low to mid 4 times debt-to-EBITDA range pro forma for the November 2010 secured notes repayment), which poses challenge for operating in a competitive industry with high business risk associated with potential product safety issues. Vitamin Shoppe also relies partially on product introductions to drive growth, creating possible revenue volatility should newly launched products fail to match evolving consumer preferences. Its strong brand name, broad product selection, demonstrated resilience of performance through a period of weak consumer spending and good geographic diversity somewhat mitigate these risks. Also, Moody's consider industry growth prospects strong given the rising U.S. population of people over 50, a demographic group that that tends to purchase higher levels of vitamins, minerals, and nutritional supplements. Good liquidity, including expectations for continued positive free cash flow, also supports the rating. The stable outlook incorporates Moody's expectations that Vitamin Shoppe will continue to generate positive free cash flow, maintain good liquidity, and report sales growth. Expectations that lease adjusted leverage will remain fairly high, in addition to the fairly small scale and business risk somewhat limit upward momentum. The relatively near maturity of the secured notes (November 2012) also somewhat constrains the rating. However, Moody's would consider a positive ratings action with sustainable leverage below 3 times debt-to-EBITDA, EBIT-to- Interest above 3 times, and free cash flow to debt around 10%. Declining sales or deterioration of liquidity or credit metrics could result in a negative ratings action. WALNUT GARDENS: Case Summary & 13 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Walnut Gardens, LLC aka Sunset Terrace Apartments 631 S. Olive Street, Suite 860 Los Angeles, CA 90014 Bankruptcy Case No.: 10-64169 Chapter 11 Petition Date: December 20, 2010 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Debtor's Counsel: Thomas C. Corcovelos, Esq. Corcovelos & Forry LLP 1001 Sixth Street, Suite 150 Manhattan Beach, CA 90266 Tel: (310) 374-0116 Fax: (310) 318-3832 E-mail: corforlaw@corforlaw.com Scheduled Assets: $7,606,585 Scheduled Debts: $18,804,543 A list of the Company's 13 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb10-64169.pdf The petition was signed by Steven Glass, attorney in fact. WASHINGTON MUTUAL: Shareholders Can't Make New Plan Arguments ------------------------------------------------------------- Peg Brickley, writing for Dow Jones' Daily Bankruptcy Review, reports that Judge Mary F. Walrath rejected a request by Washington Mutual shareholders to make new arguments against the Debtors' Chapter 11 plan. Judge Walrath gave no explanation for rejecting the request. The official shareholder committee opposed confirmation of the Plan. The Plan proposes to distribute $7 billion to creditors but wipe out shareholders. According to Ms. Brickley, shareholders said renewed Chapter 11 plan arguments were warranted due to an event that they contend significantly increases the amount of value Washington Mutual has to distribute: a delay in the parent Company's abandonment of its equity stake in WaMu. Ms. Brickley relates the equity is worthless in and of itself, as WaMu was sold to J.P. Morgan Chase & Co. after being seized by regulators. However, it entitles Washington Mutual to take advantage of tax breaks due to the losses it sustained when the thrift was seized. By waiting until next year to shed the WaMu equity, Washington Mutual boosted the size of the tax breaks available to it. Once out of bankruptcy, Ms. Brickley relates, WaMu will continue to exist as a shell, operating an insurance company in "run-off," that is, writing no new business but managing existing policies. At confirmation hearings, WaMu said it expects the reorganized company to be able to use $100 million worth of tax breaks to shelter the income from its severely curtailed continuing operations. The plan confirmation trial concluded December 7. The Troubled Company Reporter, citing a Dow Jones' Daily Bankruptcy Review article, reported December 21, 2010, that Judge Walrath said she won't rule on the Plan this year. The TCR, citing Reuters Legal, reported that the settlement requires court approval by December 31 but Judge Walrath said the court could not meet that deadline. She ordered the parties to advise her by December 29 if they would extend the deadline for her opinion to January 31. 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. Washington Mutual Bank was taken over on Sept. 25, 2008, 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. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. Fred S. Hodera, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York City and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unseucred Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired WaMu's assets prior to the Petition Date. WEST VIRGINIA NATIONAL: AM Best Cuts Issuer Credit Rating to BB --------------------------------------------------------------- A.M. Best Co. has downgraded the financial strength rating to B (Fair) from B+ (Good) and issuer credit rating to "bb" from "bbb-" of West Virginia National Auto Insurance Company (West Virginia National Auto) (Morgantown, WV). The outlook for both ratings is stable. The downgrades reflect West Virginia National Auto's declining capitalization trend driven by its recent and projected growth in premium volume and associated liabilities. As a result, the company faces additional risks in the pricing, claims and reserving associated with its new business expansion in Virginia amid competitive market conditions. Also, the company's earnings in recent years have been dampened by consistently unprofitable underwriting results and expense issues. These negative rating factors are partially offset by West Virginia National Auto's fair capitalization, generally profitable operating results and management's local market knowledge specializing in non-standard automobile risks. A.M. Best will continue to monitor the company's operating performance and overall capitalization to ensure these factors remain within A.M. Best's expectations. WISE METALS: S&P Withdraws 'CCC' Corporate Credit Rating -------------------------------------------------------- Standard & Poor's Ratings Services said that it withdrew its 'CCC' corporate credit and 'CC' senior secured debt ratings on aluminum can sheet manufacturer Wise Metals Group LLC at the company's request. The company recently redeemed its previously rated secured notes. WORKFLOW MANAGEMENT: Obtains Final Approval to Use Cash Collateral ------------------------------------------------------------------ On December 16, 2010, the U.S. Bankruptcy Court for the Eastern District of Virginia granted, on a final basis, Workflow Management, Inc., et al., permission to use cash collateral of the Prepetition Secured Parties to fund their Chapter 11 case, pay suppliers and other parties, from December 16, 2010, until February 4, 2011, provided that all payments will be made pursuant to an approved budget. As adequate protection for the Debtors' use of their cash collateral, the Prepetition Secured Parties are granted allowed super-priority administrative expense claims, replacement liens on all property acquired by the Debtors after the Petition Date, including the proceeds of causes of action arising under chapter 5 of the Bankruptcy Code, and the accrual or payment of interest and fees, as provided in the Final Order. The Final Order relating to the Debtors' use of cash collateral also requires, among other things, that Debtors obtain Bankruptcy Court approval of a disclosure statement explaining the Debtors' Chapter 11 plan of reorganization by January 18, 2011. As of the Petition Date, the total amount of outstanding first- lien debt was $141,553,802.26 in principal, and $4,819,000.00 in undrawn Letters of Credit, and the total amount of outstanding second-lien debt was $190,936,685.80 in principal. The agent for the first-lien lenders is Credit Suisse, Cayman Islands Branch, and the agent for the second-lien lenders is Silver Point Finance LLC. The obligations to the first-lien and second-lien lenders are secured by liens on and security interests in essentially all of the personal and real property of the Debtors who are Loan Parties, and all proceeds thereof, including the Cash Collateral. A complete text of the Final Cash Collateral Order is available for free at: http://bankrupt.com/misc/workflow.finalcashcollateralorder.pdf About Workflow Management Headquartered in Dayton, Ohio Workflow Management, Inc., fka Workflow Graphics, Inc. -- http://www.workflowone.com/-- offers commercial printing services, including print buying and document management capabilities, through three divisions: WorkflowOne, Freedom Graphics Services, and United Envelope. It also distributes office products and promotional items through an online ordering system. Its customers include both small and large companies throughout North America in such sectors as financial services, health care, retail, and government. Workflow Management Inc., and its affiliates, filed for Chapter 11 bankruptcy protection on September 29, 2010 (Bankr. E.D. Va. Lead Case No. 10-74617). Cullen A. Drescher, Esq., Daniel F. Blanks, Esq., Douglas M. Foley, Esq., and Patrick L. Hayden, Esq., at McGuireWoods LLP; Sarah Beckett Boehm, Esq., at McGuireWoods LLP; and Rosa J. Evergreen, Esq., at Arnold & Porter LLP, assist the Debtors in their restructuring effort. Arnold & Porter LLP is the Debtors' special counsel. Kaufman & Canoles, P.C., is the Debtors' corporate counsel. FTI Consulting is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. Workflow Management estimated assets and debts at $100 million to $500 million as of the Chapter 11 filing. XODTEC LED: Barron Partners Discloses 4.1% Equity Stake ------------------------------------------------------- In an amended Schedule 13G filing with the Securities and Exchange Commission on December 13, 2010, Barron Partners LP disclosed that it beneficially owns 1,000,000 shares of Xodtec Group USA, Inc. common stock representing 4.1% of the shares outstanding. The number of shares of Xodtec Led, Inc.'s common stock outstanding, as of October 11, 2010 was 25,364,827. About Xodtec LED Headquartered in Jhonghe City, Taiwan, Xodtec LED, Inc. is a Nevada corporation incorporated on November 29, 2006, under the name Sparking Events, Inc. On June 28, 2009, the Company's corporate name was changed to "Xodtec Group USA, Inc." and on May 17, 2010, the Company's corporate name was changed to "Xodtec LED, Inc." The Company, through its subsidiaries, is engaged in the design, marketing and selling of advanced lighting solutions which are designed to use less energy and have a longer life than traditional incandescent, halogen, fluorescent light sources. The Company's wholly-owned subsidiaries, Xodtec Technology Co., Ltd.; Targetek Technology Co., Ltd.; UP Technology Co., Ltd., are organized under the laws of the Republic of China (Taiwan). The Company also owns a 35% interest in Radiant Sun Development S.A., a company organized under the laws of the Independent State of Samoa. The Company's balance sheet at August 31, 2010, showed $1.7 million in total assets, $3.1 million in total liabilities, and a stockholders' deficit of $1.4 million. Z TRIM HOLDINGS: E. Smith Discloses 70.2% Equity Stake ------------------------------------------------------ In an amended Schedule 13D filing with the Securities and Exchange Commission on December 13, 2010, Edward B. Smith, III disclosed that he beneficially owns 18,638,665 shares of common stock of Z Trim Holdings, Inc. common stock representing 70.2% of the shares outstanding. At November 9, 2010, there were 8,000,814 shares of common stock outstanding. Each of Brightline Capital Management, LLC, Nick Khera and Brightline Ventures I, LLC owns 18,568,665 shares of common stock representing 69.9% equity stake. On November 29, 2010, Brightline Ventures purchased 7.07 preferred stock units of the Company and on December 7, 2010, Brightline Ventures purchased 220.6266 Preferred Stock Units. Each Preferred Stock Unit consists of 2,000 shares of Series I, 8%, convertible preferred stock, par value $0.01 per share and one five-year warrant to immediately purchase 15,000 Shares at an exercise price of $1.50 per Share. The Preferred Stock is convertible at the rate of $1.00 per share into Shares. The funds for the purchase of the Preferred Stock Units by Brightline Ventures came from the working capital of Brightline Ventures, over which Messrs. Khera and Smith, through their roles at Brightline Capital, exercise investment discretion. No borrowed funds were used to purchase the Preferred Stock Units from the Issuer, other than any borrowed funds used for working capital purposes in the ordinary course of business. The total cost for the Preferred Stock Units purchased on November 29, 2010 by Brightline Ventures was $70,700 and the total cost for the Preferred Stock Units purchased on December 7, 2010 by Brightline Ventures was $2,206,266. About Z Trim Mundelein, Ill.-based Z Trim Holdings, Inc., is a functional food ingredient company which provides custom product solutions that help answer the food industry's problems. Z Trim's revolutionary technology provides value-added ingredients across virtually all food industry categories. Z Trim's all-natural products, among other things, help to reduce fat and calories, add fiber, provide shelf-stability, prevent oil migration, and add binding capacity -- all without degrading the taste and texture of the final food products. The Company's balance sheet as of June 30, 2010, showed $4.4 million in total assets, $14.8 million in total liabilities, and a stockholders' deficit of $10.4 million. As reported in the Troubled Company Reporter on April 12, 2010, M&K, CPAs, PLLC, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has suffered recurring losses from operations and requires additional financing to continue in operation. The Company discloses in its latest 10-Q that it does not expect or anticipate that its concerns over its ability to continue as a going concern will have any impact on its ability to raise capital from internal and external sources. * Municipal Investors Grow Pickier About Insurers' Fin'l Health --------------------------------------------------------------- Amid the recent sell-off in the U.S. municipal-bond market, investors are increasingly differentiating between state and local governments with strong finances and those facing big fiscal woes, Dow Jones' Small Cap reports. According to the report, that trend could have significant implications for holders of bonds issued by weaker state and local governments, some of which are already paying higher interest rates and have seen the prices of their bonds decline in value. The report relates that the growing gap between what the strongest and weakest government issuers pay to borrow brings unpleasant echoes of the European debt crisis, where escalating yields paid by countries such as Greece and Ireland made their fiscal situations untenable. For muni investors, the scenario could prove similar - a series of rolling crises as the spotlight goes from one troubled issuer to the next, the report notes. Dow Jones' says that underlying this dynamic are issuers struggling not just with budget woes, but with higher borrowing costs that end up inflating budget deficits. * Foreclosure Filings 2010 Show No Shortage of Foreclosed Homes --------------------------------------------------------------- Record numbers of foreclosures hit the market in 2010, as well as record numbers of people looking to buy them, reports Foreclosure Deals, a leading online provider of foreclosure news and information, in a year-end Foreclosure Filings 2010 review. The record-breaking trend of 2009 continued throughout the year, as foreclosures have remained high and many experts are expecting them to climb even higher in 2011. As a result, says James Foxx, a Foreclosure Deals business analyst, many buyers are flocking to the foreclosure market in search of low prices to match record-low mortgage interest rates. "2010 was a big year for foreclosure investing, and 2011 is shaping up to be very similar," Foxx remarked. After a record 2.8 million homes entered foreclosure proceedings in 2009, experts predicted foreclosure filings 2010 would surge even higher. As a response, Congress and the Federal Reserve pledged to do something about it. Interest rates were set low, partly as an encouragement to buyers to start buying up surplus foreclosure homes. Talk of legislation designed to reduce foreclosure filings began spreading in Washington. The year began with a customary January slump, as foreclosure activity fell 10%. By February, foreclosures were up by only 6% from the previous year, the lowest increase in foreclosures since the epidemic began. In March, the White House revealed its plan to curb foreclosures. The plan provided increased funding for foreclosure education while giving lenders incentives for providing loan modification and refinancing for troubled homeowners. Experts, however, warned that this would only stall foreclosures, as loan modification couldn't help everybody with trouble paying their mortgage. By the end of April, these fears seemed well founded. New statistics revealed that foreclosures in the first quarter were 35% higher than in 2009. A closer look at the numbers revealed that much of this increase was in bank repossessions and REO homes, the last stage of foreclosure. There was a much slower growth rate in new foreclosure listings coming onto the market. With moratoriums expiring and banks looking to clear out backlogs of defaulted homes, millions more properties were set to be foreclosed. As the hot months dragged on, the trend of increased bank foreclosures, but slower-than-normal growth in new foreclosures, continued. Summer also saw large increases in metropolitan foreclosures, and the infamous foreclosure-hotbed states of California, Nevada, Florida, and Arizona suddenly accounted for 19 of the top 20 foreclosure cities in the nation. By September, industry figures warned that since economic conditions were not improving, the scene was set for more foreclosures. Then came a public outcry over the scandal at Bank of America and JP Morgan, where officials were discovered to have issued foreclosures on homes without even bothering to review them. The story illuminated the frustration with the foreclosure filings 2010 problem, as even the banks seemed to be overwhelmed by the sheer volume of properties. Despite that October and November saw further decreases in new foreclosures, buyers should be aware that a swell in new foreclosures could happen at any time as loan modification periods expire and more homeowners fall further behind on mortgage payments in 2011. ForeclosureDeals.com Business Analyst James Foxx is quick to point out the positives for these interested in buying foreclosure houses. "We saw a lot more repossessions, but we also saw record numbers of homebuyers at foreclosure sales," remarked Foxx. "Foreclosures are selling at rock-bottom prices, and they remain the best way for first-time homebuyers or investors to find the best deals. I think it's clear that statistics for foreclosures in 2011 are going to look very similar to those for foreclosure filings 2010." * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ------------------------------------------------------------- Recent Chapter 11 cases filed with assets and liabilities below $1,000,000: In Re A Child's Dream Learning Center, Inc. Bankr. D. Ariz. Case No. 10-38940 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/azb10-38940.pdf In Re Rosemont, LLC Bankr. D. Ariz. Case No. 10-38993 Chapter 11 Petition filed December 6, 2010 filed pro se In Re Charlotte R. Roa Bankr. C.D. Calif. Case No. 10-49199 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/cacb10-49199.pdf In Re Zippy's Currency X-Change Inc. Bankr. C.D. Calif. Case No. 10-62064 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/cacb10-62064.pdf In Re Streetcar Charlies, LLC Bankr. M.D. Fla. Case No. 10-29218 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/flmb10-29218.pdf In Re Norman Quintero Ministries, Inc. Bankr. S.D. Fla. Case No. 10-47196 Chapter 11 Petition filed December 6, 2010 filed pro se In Re Amanda C. McLeod Bankr. M.D. Ga. Case No. 10-54094 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/gamb10-54094.pdf In Re Marland J. McLeod Bankr. M.D. Ga. Case No. 10-54093 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/gamb10-54093.pdf In Re Move of God Miracle Cathedral, Inc. Bankr. N.D. Ga. Case No. 10-14561 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/ganb10-14561.pdf In Re Effingham Housing Alternatives, Ltd. Bankr. S.D. Ga. Case No. 10-42629 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/gasb10-42629.pdf In Re Salzburger Properties, Inc. Bankr. S.D. Ga. Case No. 10-42628 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/gasb10-42628.pdf In Re DR Dickson, LLC Bankr. W.D. La. Case No. 10-81887 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/lawb10-81887.pdf In Re Best For Less Granite, LLC Bankr. W.D. La. Case No. 10-81888 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/lawb10-81888.pdf In Re John V. Frankowski Bankr. D. N.J. Case No. 10-47729 Chapter 11 Petition filed December 6, 2010 See http://bankrupt.com/misc/njb10-47729.pdf In Re Farmville Group, LLC Bankr. E.D. Va. Case No. 10-20336 Chapter 11 Petition filed December 10, 2010 filed pro se In Re Housemasters Design/Build Professionals, Inc. Bankr. D. Kan. Case No. 10-42215 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/ksb10-42215.pdf In Re Lester Joseph Temple, Jr. aka Mickey Temple dba L.J. Temple Landscaping Services Lorraine Ann Temple Bankr. D. Md. Case No. 10-37947 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/mdb10-37947.pdf In Re Gaoussou Kouyate Fatoumata Kouyate Bankr. S.D. N.Y. Case No. 10-16601 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/nysb10-16601.pdf In Re Reliatech Sales & Service, LLC Bankr. W.D. N.Y. Case No. 10-15242 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/nywb10-15242.pdf In Re Clinton Scott Tucker aka Sunsational Tanning Center dba Sunsational Tanning Salon, LLC Delynn G. Tucker Bankr. D. Ore. Case No. 10-67281 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/orb10-67281.pdf In Re TILIA, Inc. aka Laboratorio Clinico Las, Ameri Bankr. D. Puerto Rico Case No. 10-11627 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/prb10-11627.pdf In Re Perlock Center, L.L.C. Bankr. E.D. Va. Case No. 10-38527 Chapter 11 Petition filed December 13, 2010 See http://bankrupt.com/misc/vaeb10-38527.pdf In Re 13602 N 50TH LLC Bankr. D. Ariz. Case No. 10-39769 Chapter 11 Petition filed December 14, 2010 filed pro se In Re Marcia Black Bankr. D. Ariz. Case No. 10-39851 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/azb10-39851.pdf In Re Nujya Anmwhfit Muhammad fka Nujah Muhammad fka Nujya Strawder Bankr. C.D. Calif. Case No. 10-50088 Chapter 11 Petition filed December 14, 2010 filed pro se In Re Maria M. Bedolla Bankr. N.D. Calif. Case No. 10-62765 Chapter 11 Petition filed December 14, 2010 filed pro se In Re Glo Investments, LLC Bankr. S.D. Fla. Case No. 10-47962 Chapter 11 Petition filed December 14, 2010 filed pro se In Re Myers Electrical Inc. Bankr. D. Kan. Case No. 10-14169 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/ksb10-14169.pdf In Re Turtlefuns, Incorporated Bankr. D. Mass. Case No. 10-23505 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/mab10-23505p.pdf See http://bankrupt.com/misc/mab10-23505c.pdf In Re Doreen Boyle Bankr. D. Nev. Case No. 10-33263 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/nvb10-33263.pdf In Re Esteban Vega-Alonso Elvira Vega Bankr. D. Nev. Case No. 10-33269 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/nvb10-33269.pdf In Re Ravinder Kaur Johal Gurdeep Singh Bankr. D. Nev. Case No. 10-54862 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/nvb10-54862.pdf In Re Our Daily Soup, LLC Bankr. D. N.J. Case No. 10-48529 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/njb10-48529.pdf In Re Levine Design, Inc. Bankr. W.D. Pa. Case No. 10-28821 Chapter 11 Petition filed December 14, 2010 See http://bankrupt.com/misc/pawb10-28821.pdf In Re Michael Thomas Sondgeroth Luzviminda Jiminez Sondgeroth Bankr. D. Ariz. Case No. 10-39983 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/azb10-39983.pdf In Re Gas Plumbing Services, Inc. Bankr. M.D. Fla. Case No. 10-22181 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/flmb10-22181.pdf In Re Group Molinari, LLC Bankr. S.D. Fla. Case No. 10-48005 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/flsb10-48005.pdf In Re Bullhead 1117, LLC Bankr. D. Nev. Case No. 10-33331 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/nvb10-33331p.pdf See http://bankrupt.com/misc/nvb10-33331c.pdf In Re YEAH! Inc. Bankr. D. Puerto Rico Case No. 10-11744 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/prb10-11744.pdf In Re Bandera Elite Holdings, Inc. dba Cedar Creek Nursing and Rehabilitation Center Bankr. N.D. Texas Case No. 10-48143 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/txnb10-48143.pdf In Re Sulphur Springs Elite Holdings, Inc. dba Sunny Springs Nursing and Rehabilitation Center Bankr. N.D. Texas Case No. 10-48144 Chapter 11 Petition filed December 15, 2010 See http://bankrupt.com/misc/txnb10-48144.pdf In Re Edgar Reinoso Linda Reinoso Bankr. C.D. Calif. Case No. 10-63610 Chapter 11 Petition filed December 16, 2010 filed pro se In Re Astro Tel, Inc. Bankr. M.D. Fla. Case No. 10-29992 Chapter 11 Petition filed December 16, 2010 See http://bankrupt.com/misc/flmb10-29992.pdf In Re MLJAFA, Inc. dba Papa Joe's Restaurant Bankr. N.D. Ill. Case No. 10-55569 Chapter 11 Petition filed December 16, 2010 See http://bankrupt.com/misc/ilnb10-55569.pdf In Re Baer Architecture Group, Inc. Bankr. D. Mass. Case No. 10-46155 Chapter 11 Petition filed December 16, 2010 See http://bankrupt.com/misc/mab10-46155.pdf In Re Richard Garofano Bankr. D. Mass. Case No. 10-23621 Chapter 11 Petition filed December 16, 2010 See http://bankrupt.com/misc/mab10-23621.pdf In Re ResCom Northpark, LLC Bankr. S.D. Miss. Case No. 10-04419 Chapter 11 Petition filed December 16, 2010 See http://bankrupt.com/misc/mssb10-04419.pdf In Re Aesthetics Dental Laboratory LLC Bankr. D. Neb. Case No. 10-43747 Chapter 11 Petition filed December 16, 2010 See http://bankrupt.com/misc/neb10-43747.pdf In Re 6920 REDFIELD LLC Bankr. D. Ariz. Case No. 10-40284 Chapter 11 Petition filed December 17, 2010 filed pro se In Re Lexani Limousines, LLC fdba Avalon Limousines, LLC Bankr. D. Ariz. Case No. 10-40351 Chapter 11 Petition filed December 17, 2010 See http://bankrupt.com/misc/azb10-40351.pdf In Re Valentin Delafuente aka JoJo Delafuente dba April Garden Villa aka JoJo De La Fuente Bankr. N.D. Calif. Case No. 10-62890 Chapter 11 Petition filed December 17, 2010 See http://bankrupt.com/misc/canb10-62890.pdf In Re Tara Lynn McCoy aka Tara L McCoy aka Tara McCoy Bankr. D. Colo. Case No. 10-41415 Chapter 11 Petition filed December 17, 2010 See http://bankrupt.com/misc/cob10-41415.pdf In Re S.L.R.C., L.L.P. Bankr. M.D. Fla. Case No. 10-10845 Chapter 11 Petition filed December 17, 2010 See http://bankrupt.com/misc/flmb10-10845.pdf In Re Zane & Co. Hair Salon Inc. dba Casablanca Beauty Center Bankr. M.D. Fla. Case No. 10-10839 Chapter 11 Petition filed December 17, 2010 See http://bankrupt.com/misc/flmb10-10839.pdf ********* 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 ***