TCR_Public/110126.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Wednesday, January 26, 2011, Vol. 15, No. 25

                            Headlines

1 ASHBURY: Voluntary Chapter 11 Case Summary
1ST CENTENNIAL: FDIC Sues 14 Former Bank Officers, Directors
A-CAR TRUCKING: Files for Chapter 7 Liquidation
ABE ALIZADEH: Arrested for Not Paying State Taxes
ACCREDITED HOME: Settles Overtime Suit for 10% of Claim

AGRI-BEST HOLDINGS: Advantage Capital to Probe Wells Fargo
ALL AMERICAN GROUP: No Date Yet for Meeting to Approve Merger
ALLIED SECURITY: S&P Affirms 'B' Rating; Outlook 'Negative'
ALLY FINANCIAL: S&P Raises Preferred Stock Rating to 'CC'
ALTER COMMUNICATIONS: H.G. Roebuck to Appeal Plan Confirmation

AMBAC FINANCIAL: Fixes March 2, 2011, as Claims Bar Date
AMBAC FINANCIAL: LTDC is New Trustee for DISCS Purchasers
AMBAC FINANCIAL: Time to Remove Actions Extended on Interim
AMBAC FINANCIAL: Wins OK for KPMG as Tax Consultant
AMERICAN HOME: Liquidating Trustee Wants Loan Docs. Destroyed

APPLESEED'S INTERMEDIATE: Organizational Meeting on Jan. 28
APPLESEED'S INTERMEDIATE: Has OK to Hire Kurtzman as Claims Agent
ATA AIRLINES: Dist. Ct. Rejects Bid for New Trial in FedEx Suit
ATLANTIC SOUTHERN: To Voluntarily Delist Common Stock from Nasdaq
ATTACHMATE CORP: S&P Puts 'BB-' Rating on Proposed $865MM Facility

AVIV HEALTHCARE: Moody's Rates Proposed Sr. Unsec. Notes 'B1'
AXION INTERNATIONAL: Appoints Steve Silverman as New CEO
BANNING LEWIS: Bankruptcy Won't Affect Water Supply
BERNARD L MADOFF: Ponzi Victims Sue U.S. for SEC's Negligence
BIG TREE: Files for Chapter 7 Liquidation

BLOCKBUSTER INC: Court Denies Equityholders' Exam on Valuation
BLOCKBUSTER INC: Lease Decision Deadline Extended to April 21
BLOCKBUSTER INC: Wins OK to Continue Store Closing Sales
CARIS DIAGNOSTICS: Moody's to Keep 'B2' Corporate Rating
CHATEAU DE VILLE: Combined Hearing on Plan & DS Set for Feb. 4

CHATEAU DE VILLE: Court Sets February 25 as Claims Bar Date
CHATEAU DE VILLE: Motion to Sell 6 Units at Renton Property Denied
CIENA CORP: S&P Affirms 'B' Corporate; Outlook Now 'Negative'
CLST HOLDINGS: Gets Confidential Treatment of FCC Agreements
CNL HOTELS: Feb. 1 Debt Payment Looms; Lender Groups Negotiate

CONSOLIDATED HORTICULTURE: Court Fixes March 31 as Claims Bar Date
CORNERSTONE BANCSHARES: R. Vercoe Appointed Community Bank CCO
COSINE COMMUNICATIONS: Effects Reverse/Forward Stock Split
CPI INT'L: S&P Assigns 'B+' to Proposed Sr. Credit Facility
CROWN AMERICAS: S&P Rates $700MM Unsec. Note Offering at 'BB-'

DAMON PURSELL: Plan Outline Filed; All Claims to Be Paid Over Time
DANA HOLDING: Moody's Puts 'B3' Rating on New Sr. Unsecured Notes
DEL MONTE FOODS: Fitch Cuts IDR to 'B' on More Debt from Buyout
DELTA AIR: Discloses Sale of $474 Mil. in Certificates
DELTA AIR: Files Post-Confirmation Report for Third Quarter

DELTA AIR: Flight Attendants Reject AFA Representation
DELTA AIR: Reports December 2010 Traffic Results
DELTA AIR: Signs Note Purchase Agreement With U.S. Bank
DELTA PETROLEUM: S&P Cuts Senior Unsecured Debt Rating to CCC-
DIVERSIFIED INDUSTRIES: Proofs of Claim Due February 7

DUNE ENERGY: S&P Cuts Second-Lien Secured Rating to 'CC'
DYNEGY INC: Seneca Wants Poison Pill Waived to Buy More Shares
EMERGENCY MEDICAL: S&P Puts 'BB' Corporate on CreditWatch Negative
ENCOMPASS DIGITAL: Moody's Gives 'Caa1' on 5.3x debt-to-EBITDA
EXTENDED STAY: Affiliates File Post-Confirmation Report for Q4

EXTENDED STAY: Files Declarations for Nov.-Dec. Disbursements
F&G LEONARD: Taberna Country Club Owner Mulls Bankruptcy
FAIRPOINT COMMUNICATIONS: New Stock Begins Trading on Nasdaq
FEDERAL MORTGAGE: Founders Face Suit for Alleged Ponzi Scheme
FLINT TELECOM: Files Prospectus for 12-Mil. Shares Held by Kodiak

FOR 1031: Voluntary Chapter 11 Case Summary
FUQI INT'L: NASDAQ Grants Firm's Request for Continued Listing
GALLE GLOBAL: Hedge Fund to Liquidate Amid Losses
GR HOLDING: Voluntary Chapter 11 Case Summary
GULF FLEET: U.S. Trustee Appoints Seven-Member Creditors Committee

HELIX ENERGY: S&P Downgrades Senior Unsecured Rating to 'CCC+'
HONOLULU MEDICAL: Process to Release Patient Records Ongoing
HUNTINGTON INGALLS: Fitch to Give 'BB' After Northrop Spin-Off
HUNTINGTON INGALLS: Moody's Assigns 'Ba2' Corp. Family Rating
HII HOLDING: Loan Upsize Won't Change Term Loan's 'B1' Rating

INSIGHT HEALTH: Faces Last-Minute Challenges to Restructuring
JEFFERSON WINDOMERE: Case Summary & 5 Largest Unsecured Creditors
LANDAMERICA FIN'L: Class Suit Goes Back to C.D. Calif. Ct.
LEHMAN BROTHERS: CalPERS Recoups Losses From LBHI Collapse
LEHMAN BROTHERS: E&Y Seeks Transfer of Lawsuit to Federal Court

LEHMAN BROTHERS: LBI Trustee Opposes Newport Plea for Affidavit
LEHMAN BROTHERS: Ruld, Ex-Execs. Seek Dismissal of Retirees Suit
MAJESTIC STAR: Plan Confirmation Hearing Set for March 3
MAXUM PETROLEUM: S&P Puts 'B-' Rating on Proposed $250MM Notes
METROPOLIS SHEETMETAL: Case Summary & Creditors List

MGM RESORTS: CityCenter Issues $1.5-Bil. of Sr. Secured Notes
MILLENNIUM MULTIPLE: Court Extends Claims Bar Date to February 14
MILLENNIUM TRANSIT: Plan Outline OK'd; Feb. 4 Confirm. Hearing Set
MILLENNIUM MULTIPLE: U.S. Trustee Names 3 Add'l Committee Members
MOONLIGHT BASIN: Hearing on Office Building Sale Moved to Feb. 14

MORTGAGE LENDERS: Liquidating Trustee Wants Loan Docs. Destroyed
MOSDOS CHEFETZ: Filed for Chapter 11 to Hold Off State Suit
NAMCO CAPITAL: Chapter 11 Trustee Sues Ezri Namvar Family
NEOMEDIA TECHNOLOGIES: JMC Holds 23.63% Equity Stake
NEVADA STAR: Hearing on Madison Plan Outline Continued to March 2

NEW JERSEY: Christie Bankruptcy Remark Amid Bond Sale Criticized
NMH HOLDINGS: S&P Raises Corporate Rating to 'B', Outlook Stable
NORTEL NETWORKS: Purchase Price to Be Set by Judge, Not Arbitrator
NYC OFF-TRACK: Chapter 9 Bankruptcy Case Dismissed
ODYSSEY PROPERTIES: Golfview Cases' Dismissal Sought by BB&T

ODYSSEY PROPERTIES: Gets Final Nod to Use Cash Collateral
OTC HOLDINGS: Able to Reduce Interest on Exit Loan
OVERLAND STORAGE: Christopher Gopal's Employment Terminated
PARK WINE: Files for Chapter 7 Liquidation
PAUL TRANSPORT: Disclosure Statement Hearing Continued to Feb. 2

PENZANCE CASCADES: Lender Battles Properties Over Cash in Ch. 11
PHILADELPHIA RITTENHOUSE: Creditor Protests Bid to Hire Adviser
PHOENIX FOOTWEAR: Deregisters Securities Unsold to Employees
POINT BLANK: Chapter 11 Plan Draws Objection on WaMu Ground
R & G ENTERPRISES: San Luis Tortilla in Chapter 11

REALOGY CORP: S&P Rates Proposed $700MM Secured Notes at 'CC'
REALOGY CORP: Moody's Assigns 'Caa1' to Proposed $700MM Sr. Notes
R.H. HOOVER: Case Summary & 18 Largest Unsecured Creditors
RHI ENTERTAINMENT: Settles with Crown Media & Hallmark
ROCK-TENN: Moody's Reviews Low-B Ratings for Likely Downgrade

ROSETTA RESOURCES: S&P Cuts Senior Unsecured Rating to 'B-'
ROSMART PLAZA: Files for Chapter 7 Liquidation
S & E PROPERTIES: Case Summary & 3 Largest Unsecured Creditors
SANDRA ANN READ: Time for Property Tax Appeal Extended
SATELITES MEXICANOS: Has Deal with Noteholders for U.S. Prepack

SCHAEFER SALT: Gets Sanctions for Improper Chapter 7 Filing
SCITOR CORP: Moody's Assigns 'B2' Corporate Family Rating
SCOTLAND-COLORADO: Case Summary & 5 Largest Unsecured Creditors
SECURECARE SERVICES: Emerges From Receivership with Invotex's Aid
SMURFIT-STONE: Moody's to Withdraw Ratings After Rock Tenn Deal

SONRISA PROPERTIES: Compass Plan Heads to Confirmation Hearing
SPECIALTY TRUST: Wants Plan Exclusivity Period Extended to March 4
T3 MOTION: Delivers $1MM Unsecured Note to Alfonso/Mercy Cordero
TERRESTAR NETWORKS: Committee Joins Sprint Suit vs. U.S. Bank
TERRESTAR NETWORKS: Creditors Committee Sues U.S. Bank

TERRESTAR NETWORKS: Sprint Nextel Defends Claims
TERRESTAR NETWORKS: Wants Until May 17 to Decide on Leases
TIG, LLC: Case Summary & 2 Largest Unsecured Creditors
TRIBUNE LTD: S&P Lowers Ratings on Notes to 'D' From 'CCC-'
USG CORP: Subsidiary Closes Gypsum Rock Quarry Facilities

UNITED CONTINENTAL: PAR Entities Have 4.7% Equity Stake
VITRO SAB: Agrees to Dismiss Chapter 15 Petition
VITRO SAB: Appeals Plan Dismissal in Mexico
WARNER MUSIC: Paris Court Finds CEO Guilty in Vivendi Lawsuit
WESTERN SUPREME: Voluntary Chapter 11 Case Summary

WORKFLOW MANAGEMENT: Unsecureds-Backed Plan Hearing on Feb. 24
W.R. GRACE: Garlock Has Approval to Access Rule 2019 Statements
YITC-GP LLC: Sequoia Wants Dismissal of Involuntary Ch. 11 Case

* Corporate Debt Discharged in Officer's Bankruptcy

* Industry Review Cues S&P's Rating Actions on U.S. Oil & Gas Cos.
* Reports on State Debt Woes Exaggerated, Nonprofit Group Says
* Restructuring of Hotel Portfolio Debts Seen This Year

* Colony-Led Group Said to Buy $820MM in Failed Bank Mortgages
* Bradley Arant Attorneys Publish Creditors' Rights Law Handbook

* Upcoming Meetings, Conferences and Seminars

                            *********

1 ASHBURY: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: 1 Ashbury Court Partners LLC
          dba Ashbury Court Apartments
              Siena Court Apartments
        3053 Fillmore Street, Suite 260
        San Francisco, CA 94123

Bankruptcy Case No.: 11-10131

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       District of Kansas (Wichita)

Judge: Robert E. Nugent

Debtor's Counsel: L. Donald Huelson, Esq.
                  HUELSON LAW FIRM, LLC
                  16029 S. Bradley
                  Olathe, KS 66062
                  Tel: (913)254-1400
                  Fax: (913)254-1411
                  E-mail: dhuelson@huelsonlawfirm.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 Ross Meyeraan, manager member of
managing member.


1ST CENTENNIAL: FDIC Sues 14 Former Bank Officers, Directors
------------------------------------------------------------
Edvard Pettersson at Bloomberg News reports that the Federal
Deposit Insurance Corp. sued 14 former officers and directors of
First Centennial Bank for negligence, saying it had to pay
$163 million to depositors after the bank failed in January of
2009.

1st Centennial Bank, based in Redlands, California, was closed
in January 2009 by the California Department of Financial
Institutions, which then appointed the FDIC as receiver.

Following the closing, the FDIC entered into a purchase and
assumption agreement with First California Bank, in Westlake
Village, California, to assume the insured deposits of 1st
Centennial.  As of January 9, 2009, 1st Centennial had total
assets of $803.3 million and total deposits of $676.9 million, of
which there were approximately $12.8 million that exceeded the
insurance limits.

1st Centennial Bank's failure was estimated to cost the FDIC's
Deposit Insurance Fund $227 million.


A-CAR TRUCKING: Files for Chapter 7 Liquidation
-----------------------------------------------
The Orlando Sentinel reports that Melbourne, Florida-based A-Car
Trucking & Paving Inc. on Jan. 19 filed for liquidation under
Chapter 7 of the U.S. Bankruptcy Code, disclosing listing $0
assets and $75,049 in liabilities.  The Company's major creditor
is APAC Macasphalt in Melbourne, $61,000.  A meeting of creditors
is set for Feb. 14, 2011.


ABE ALIZADEH: Arrested for Not Paying State Taxes
-------------------------------------------------
The Sacramento Bee reports that Abe Alizadeh has been arrested on
grand theft charges in connection with an alleged failure to pay
state taxes.  The Bee says the attorney general's office accused
Mr. Alizadeh of not paying millions of dollars in sales and
unemployment taxes.  A court declaration by Sandra Gutierrez, an
investigator with the Board of Equalization, said Mr. Alizadeh
"made intentional decisions not to pay the taxes."

According to the Bee, jail records show Mr. Alizadeh was being
held in lieu of $1 million bail at the Placer County jail.

Abe Alizadeh was a longtime Jack in the Box Inc. franchisee in
Northern California.  In September 2009, Mr. Alizadeh sent four
entities that operate his Jack in the Box Inc. franchised
restaurants to Chapter 11 bankruptcy protection.


ACCREDITED HOME: Settles Overtime Suit for 10% of Claim
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Accredited Home Lenders Holding Co. agreed to settle
a $96.7 million claim at a discount of about 90%.  The settlement
will come to bankruptcy court for approval on Feb. 24.

Mr. Rochelle relates that when Accredited acquired Aames Home
Loan, Aames already had been named in a class action for violating
California state labor laws.  The plaintiff filed a claim for
$96.7 million against Accredited, the largest part representing
unpaid overtime.  The parties agreed to settle by allowing a claim
for $9.5 million.

                        About Accredited Home

San Diego, California-based Accredited Home Lenders Holding Co. --
http://www.accredhome.com/-- was a mortgage banker servicing U.S.
markets for conforming and non-prime residential mortgage loans
operating throughout the U.S. and in Canada.  Accredited sold its
mortgage-servicing business in July 2009 as part of its
bankruptcy.

Accredited Home Lenders and its affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Lead Case No. 09-11516) on May 1, 2009.
Gregory G. Hesse, Esq., Lynnette R. Warman, Esq., and Jesse T.
Moore, Esq., at Hunton & William LLP, serve as the Debtors'
bankruptcy counsel.  Laura Davis Jones, Esq., James E. O'Neill,
Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl &
Jones LLP, serve as Delaware counsel.  Kurtzman Carson Consultants
is the Debtors' claims agent.  Andrew I Silfen, Esq., Schuyler G.
Carroll, Esq., Robert M. Hirsch, Esq., at Arent Fox LLP in New
York, and Jeffrey N. Rothleder, Esq., at Arent Fox LLP in
Washington, DC, represent the official committee of unsecured
creditors as co-counsel.  Neil R. Lapinski, Esq., and Shelley A.
Kinsella, Esq., at Elliott Greenleaf, represent the Committee as
Delaware and conflicts counsel.

As reported in the TCR on January 4, 2011, the Debtors submitted
to the Bankruptcy Court a proposed Plan of Liquidation and an
explanatory Disclosure Statement, as twice amended.  The Plan does
not contemplate a continuation of the Debtors' collective
businesses.

According to its bankruptcy petition, Accredited Home's assets
range from $10 million to $50 million and its debts from
$100 million to $500 million.


AGRI-BEST HOLDINGS: Advantage Capital to Probe Wells Fargo
----------------------------------------------------------
Ameet Sachdev and Alejandra Cancino, writing for the Chicago
Tribune, report that the bankruptcy court recently allowed
Advantage Capital Partners' Chicago lawyer, Steve Jakubowski, to
start deposing Wells Fargo Bank's employees about the
circumstances that led to Advantage Capital's $7.8 million
investment in Protein Solutions -- over the bank's objection.

Advantage Capital Partners is a St. Louis-based investment firm
that specializes in small-business finance.

The Tribune report calls Protein Solution's liquidation unusual as
it received $7.85 million with the help of state tax credits just
four months before it filed for bankruptcy, financial support many
small businesses are begging for.  The funding was meant to foster
job creation in low-income communities.  The funds were supposed
to reduce Protein Solutions' debt and support its continued
growth.

"It seems crazy that they got all this money and then went
bankrupt," said Darrell Rudd, whose Chicago company supplied
cardboard boxes to Protein Solutions and is owed nearly $40,000,
according to the Tribune.  "We'll survive it, but it's not good."

The Tribune relates Advantage Capital stands to lose about
$5 million because of Protein Solutions' collapse, according to
court documents.  The Tribune says Advantage Capital blames Wells
Fargo, Protein Solutions' main lender.  The Tribune relates that
Advantage Capital said in a statement in response to Tribune
questions, that shortly after its investment in Protein Solutions,
Wells Fargo unexpectedly limited the availability of credit to the
meat supplier.  The lack of borrowing power triggered a financial
crisis from which the Protein Solutions was unable to recover,
Advantage Capital said.  It called Wells Fargo's actions
"egregious" and "inappropriate."

The Tribune relates court papers filed by the committee of
unsecured creditors support Advantage Capital's view.  According
to the Tribune, the committee said Wells Fargo stopped advancing
credit after it declared Protein Solutions in default of the
credit agreement.  The default was not triggered by a missed a
payment.  The company came up short on meeting a pretax income
threshold for the first six months of 2010, a violation of the
agreement.  The shortfall did not justify curtailing credit, the
committee said.

The Tribune notes that when Protein Solutions filed for
bankruptcy, Wells Fargo had a claim of more than $13.7 million,
but it was secured by equipment, inventory, accounts receivable
and property.  The Tribune relates that according to people
involved in the case, the value of the collateral is expected to
cover Wells Fargo's claim.

Wells Fargo declined to comment, the Tribune says.  According to
the report, Wells Fargo has denied Advantage Capital's
allegations.

The Tribune notes Protein Solutions' bankruptcy lawyer, Steven
Towbin, said Advantage Capital's criticism of Wells Fargo amounts
to sour grapes.  "Advantage is supposed to be a sophisticated
investor," said Mr. Towbin.  "They didn't have to close the deal
if they felt something was wrong or the terms had changed."

The Tribune notes Wells Fargo has to approve legal fees paid to
Mr. Towbin and other lawyers at his firm, according to court
documents.

The Tribune also reports that Protein Solutions' remaining
equipment will be auctioned later this month.

                          About Agri-Best

Chicago, Illinois-based Agri-Best Holdings LLC, dba Protein
Solutions and Agri-Best Properties, LLC, processes and distributes
portion control meat products to national restaurant chains, food
distributors, and consumers.

Agri-Best filed for Chapter 11 bankruptcy protection on October 5,
2010 (Bankr. N.D. Ill. Lead Case No. 10-44595).  Agri-Best
estimated its assets and debts at $10 million to $50 million as of
the Petition Date.

Chicago, Illinois-based Agri-Best Properties LLC filed for
Chapter 11 bankruptcy protection on October 5, 2010 (Bankr. N.D.
Ill. Case No. 10-44600).  Steven B. Towbin, Esq., at Shaw Gussis,
Fishman Glantz, Wolfson & Towbin, LLC, represented Agri-Best
Properties in the Chapter 11 case.  Agri-Best Properties
estimated its assets and debts at $1 million to $10 million.

Judge Eugene R. Wedoff converted the Debtor's Chapter 11 case to
Chapter 7, effective as of December 1, 2010.  Ronald Peterson,
Esq., at Jenner & Block, was appointed Chapter 7 trustee.


ALL AMERICAN GROUP: No Date Yet for Meeting to Approve Merger
-------------------------------------------------------------
All American Group, Inc., is planning to hold a special meeting of
shareholders at a yet-to-be-determined date to seek approval of
the proposed Agreement and Plan of Merger dated as of November 8,
2010, among All American Group Holdings, LLC, as Acquiror, All
American Acquisition Corporation as Acquisition Sub, AAG and
Richard M. Lavers as Shareholders Representative.

If the merger is completed, Acquisition Sub will merge with and
into AAG, AAG -- as the surviving corporation -- will become a
wholly owned subsidiary of Acquiror and holders of the common
shares, without par value of AAG -- other than AAG, Acquiror and
its affiliates, and shareholders that perfect their dissenters'
rights under Indiana law -- will be entitled to receive $0.20 in
cash and all shareholders, other than shareholders that perfect
their dissenters' rights under Indiana law, will receive one unit
of beneficial interest in a liquidating trust that will represent
a contingent right to receive proceeds from the potential sale of
AAG's Specialty Vehicles business in accordance with the merger
agreement, for each common share they own.

Holdings and Acquisition Sub are affiliates of the Company's
lender, H.I.G. All American LLC.  The Troubled Company Reporter
published a story on the proposed merger in its November 15, 2010
edition.

A copy of the preliminary prospectus in connection with the
upcoming meeting is available at http://is.gd/TFVxWV

                     About All American Group

Elkhart, Indiana-based All American Group, Inc., formerly Coachmen
Industries, Inc., (OTC:COHM.PK) says it is one of America's
premier systems-built construction companies under the ALL
AMERICAN BUILDING SYSTEMS(R), ALL AMERICAN HOMES(R), and MOD-U-
KRAF(R) brands, as well as a manufacturer of specialty vehicles.

The Company's balance sheet at Sept. 30, 2010, showed
$74.38 million in total assets, $40.95 million in total
liabilities, and stockholders' equity of $33.43 million

During the first quarter of 2010, the Company failed to meet
certain financial covenants of the credit agreement with H.I.G.
All American LLC.  H.I.G. did not declare the Company to be in
default of any covenant.  The parties entered into various
accommodations waiving those defaults.


ALLIED SECURITY: S&P Affirms 'B' Rating; Outlook 'Negative'
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on Conshohocken, Pa.-based Allied Security Holdings
LLC.  The outlook is negative.

At the same time, S&P assigned 'B+' issue-level ratings on the
Company's proposed $75 million revolving credit facility due in
February 2016 and proposed $395 million first-lien term loan due
in February 2017.  The recovery ratings on both debt issues are
'2', indicating S&P's expectation of substantial (70% to 90%)
recovery in the event of a payment default.  S&P also assigned a
'CCC+' issue-level rating on the Company's proposed $190 million
second-lien term loan due in February 2018.  The recovery rating
is '6', indicating S&P's expectation of negligible (0% to 10%)
recovery in the event of a payment default.

Issue-level ratings are based on preliminary documentation and are
subject to review upon final documentation.  S&P will withdraw
S&P's 'BB-' issue-level ratings on the Company's existing senior
secured credit facilities upon completion of the proposed
transaction and repayment of existing indebtedness.  S&P estimates
Allied will have about $585 million in debt outstanding when the
transaction is completed.

"The ratings reflect S&P's opinion that privately held Allied
Security has a highly leveraged financial risk profile, primarily
because of the Company's aggressive financial policy, high debt,
and weak cash flow protection measures," said Standard & Poor's
credit analyst Brian Milligan.  Pro forma for the proposed
refinancing, S&P calculate that Allied had adjusted leverage of
5.7x at Sept. 30, 2010.  S&P assesses the Company's business risk
profile as weak, reflecting its No. 3 position in the highly
fragmented and competitive contract security officer industry and
narrow business focus.

S&P's financial risk profile assessment reflects Allied's high
leverage and S&P's expectation that the Company's financial policy
will remain aggressive, keeping leverage above 5x for the next
year.

The proposed refinancing could improve the Company's financial
risk profile; the transaction will extend debt maturities and
reduce borrowing costs.  The reduced borrowing costs should create
an estimated incremental $17 million in free operating cash flow.
S&P could revise S&P's assessment of the Company's financial risk
profile to aggressive if the Company uses its free operating
cash flow to accelerate both debt repayment and leverage
reduction.

Allied has a narrow business focus in the highly competitive and
fragmented contract security officer industry.  S&P believe
industry consolidation is under way.  Tuck-in acquisitions will
likely remain part of Allied's growth strategy, but S&P believe
the Company's highly leveraged capital structure will limit this
opportunity.

S&P's business risk profile assessment also reflects the
industry's low customer switching costs and barriers to entry that
create intense pricing pressure and the possibility of losing
contracts.  Allied's diversified customer base (its largest
customer accounts for about 2% of sales) partially mitigates this
risk.

The outlook for Allied Security is negative, reflecting S&P's
opinion that the Company's highly leveraged financial risk profile
will limit its financial flexibility and may reduce its
competitive position in a highly competitive and fragmented
industry.  The outlook also reflects S&P's opinion that the
Company's financial policy will remain aggressive, keeping
leverage above 5x for the next year.

S&P could revise the outlook to stable if the Company makes
meaningful improvement in its credit measures, resulting in
leverage returning to the low-5x area.  Although this could occur
with high-single-digit revenue growth and slight EBITDA margin
expansion, S&P believe a combination of growth and accelerated
debt repayment will be necessary to return leverage to the low-5x
area.

S&P could lower the rating if revenue declines, possibly from
losing multiple contracts or significant pricing pressure, or if
the Company's financial policy remains aggressive, thereby
restricting steady credit measure improvement.  More specifically,
S&P could lower the rating if leverage approaches 6.5x, which S&P
believes could occur if revenue declines slightly and
EBITDA margins erode by about 80 basis points.


ALLY FINANCIAL: S&P Raises Preferred Stock Rating to 'CC'
---------------------------------------------------------
Standard & Poor's Ratings Services raised its rating on the
preferred stock of Ally Financial Inc. (Ally; B/Stable/C) to 'CC'
from 'C'.

Ally (formerly GMAC Inc.) improved its liquidity position and
alleviated some funding pressure at its holding Company in recent
months, making it easier to meet obligations on its preferred
stock.  Nevertheless, the Company faces significant debt
maturities at its holding Company in 2011 and 2012, which is
reflected in the 'CC' rating.

Ally has added liquidity at its holding Company, through both
demonstrated access to the public debt markets and the
amortization of receivables.  Ally issued more than $8 billion in
long-term unsecured debt in 2010.  Also, the U.S. Treasury's
recent conversion of $5.5 billion of its $11.4 billion in Ally
convertible preferred shares into common stock reduces the
Company's preferred dividend obligations by about $500 million
annually.  The Treasury's conversion allows Ally to expand the use
of its commercial bank subsidiary, Ally Bank, to finance its
operations, alleviating some holding-Company funding pressure.
That is because the conversion diluted the ownership of General
Motors Co. (GM), Ally's largest business partner, to less than
10%.  As a result, the Federal Reserve no longer considers GM an
"affiliate" of Ally Bank, a designation that previously limited
the bank's ability to finance GM-related receivables.  This change
should gradually shift more of Ally's total funding toward bank
deposits and away from the wholesale and unsecured financing
issued outside of the bank.

To be sure, Ally will continue to rely heavily on nonbank funding-
-likely for several years -- and has significant debt obligations
to meet in 2011 and 2012.  Roughly $9.5 billion and $12.6 billion
of its unsecured debt matures in 2011 and 2012, respectively.  Its
funding profile remains subject to a high degree of confidence
sensitivity, in S&P's view.  Any unexpected problems could
sharply limit its access to the debt markets.  Still, S&P believes
the Company will have sufficient liquidity to meet obligations and
its preferred dividends this year, partly because of its recent
efforts and the conversion of Treasury shares.


Ratings List

Ally Financial Inc.
Counterparty Credit Rating             B/Stable/C

Upgraded
                                        To                 From
Ally Financial Inc.
Preferred Stock                        CC                 C

Preferred Blocker Inc.
Preferred Stock


ALTER COMMUNICATIONS: H.G. Roebuck to Appeal Plan Confirmation
--------------------------------------------------------------
Melanie Cohen, writing for Dow Jones' Daily Bankruptcy Review,
reports that printing company H.G. Roebuck & Son Inc., whose claim
Alter Communications Inc. disputed, said Alter's bankruptcy plan
wasn't filed in good faith and that it "discriminates unfairly."

Alter's bankruptcy-exit plan was approved by a judge last month.
Under the Plan, unsecured creditors were to divide 85% of the
company's earnings over the next five years.

"The debtor's goals in this case are transparent," H.G. Roebuck
attorneys said in court papers, according to DBR.  "It wants to
avoid paying Roebuck while paying the legally indistinguishable
claims of the other unsecured creditors."

According to DBR, Roebuck said it waited to file an appeal until
after the bankruptcy plan was filed because it wasn't sure it
could make it by the court-imposed deadline.  It said that it
would submit the appeal after it had "the opportunity to conduct
discovery."

DBR relates Roebuck attorneys also said in court papers that Alter
wants to keep the same owners, the Buerger family, "so that they
can reap the benefit of having eliminated Roebuck's claim for a
nominal sum . . . without subjecting itself or the Buerger family
to the risk that a plan will be proposed by Roebuck or someone
else that is less insider-friendly."

DBR relates that, according to the Maryland Daily Record, the
dispute started after Alter and Roebuck split up over a cost issue
with two years left on the contract.  Roebuck sued in December
2009 and was awarded $362,000.  The company had another claim for
more than $1 million in damages pending, according to the
newspaper.

Based in Baltimore, Maryland, Alter Communications publishes the
Baltimore Jewish Times.  Other publications include the magazine
Style, with 90,000 circulation, and Chesapeake Life, with a
circulation of 57,000.

Alter Communications filed for Chapter 11 (Bankr. D. Md. Case No.
10-18241) on April 14, 2010.  Alan M. Grochal, Esq., and Maria
Ellena Chavez-Ruark, Esq., at Tydings and Rosenberg, in Baltimore,
serve as the Debtor's bankruptcy counsel.  The Debtor estimated
assets and debts between $1 million and $10 million in its Chapter
11 petition.

According to the Baltimore Business Journal, Judge James F.
Schneider of the Baltimore bankruptcy court approved Alter
Communications' Chapter 11 exit plan on December 16, 2010.


AMBAC FINANCIAL: Fixes March 2, 2011, as Claims Bar Date
--------------------------------------------------------
Judge Shelley C. Chapman of the U.S. Bankruptcy Court for the
Southern District of New York has established March 2, 2011, at
5:00 p.m., as the deadline by which all persons and entities must
file proofs of claim, other than certain exempt parties against
Ambac Financial Group Inc., including requests for payment under
Section 503(b)(9) of the Bankruptcy Code.

The Court has also fixed May 9, 2011, at 5:00 p.m., as the
deadline by which all governmental units must file proofs of
claim against the Debtor.

                       About Ambac Financial

Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.

Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code in Manhattan (Bankr.
S.D.N.Y. Case No. 10-15973) on November 8, 2010.  Ambac said it
will continue to operate in the ordinary course of business as
"debtor-in-possession" under the jurisdiction of the Bankruptcy
Court and in accordance with the applicable provisions of the
Bankruptcy Code and the orders of the Bankruptcy Court.

Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy.  AAC is being restructured by state regulators in
Wisconsin.  AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.

Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed $30.05 billion in total assets,
$31.47 billion in total liabilities, and a $1.42 billion
stockholders' deficit, at June 30, 2010.

On an unconsolidated basis, Ambac said in a court filing that
it has assets of ($394.5 million) and total liabilities of
$1.6826 billion as of June 30, 2010.

Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about $1.62 billion.

The Vanguard Group, Inc., holds 5.46% of the stock of Ambac and is
its largest shareholder.

Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP represent the Debtor.  The
Blackstone Group LP is the Debtor's financial advisor.  Kurtzman
Carson Consultants LLC is the claims and notice agent.

Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel to
the Official Committee of Unsecured Creditors.

Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY
NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by Ambac Financial Group Inc.
(http://bankrupt.com/newsstand/or 215/945-7000)


AMBAC FINANCIAL: LTDC is New Trustee for DISCS Purchasers
---------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy
Procedure, Anthony A. Bocchino, Jr., managing director at Law
Debenture Trust Company of New York, relates that his firm is
successor-in-interest to Bank of New York Mellon as trustee under
a Junior Subordinated Indenture dated February 12, 2007, by and
between Ambac Financial Group, Inc., as company, and The Bank of
New York Mellon, formerly known as The Bank of New York.

Under the Indenture, AFG issued $400 million aggregate principal
amount of 6.15% Directly Issued Subordinated Capital Securities
due February 7, 2087.  The DISCS are registered in the name Cede
& Co.

Mr. Bocchino discloses that the claims of the beneficial holders
of the DISCS and the Successor Indenture Trustee under the
Indenture consist of:

   (i) all unpaid principal and unpaid interest on all
       outstanding DISCS, plus other amounts due under the
       Indenture;

  (ii) the Successor Indenture Trustee's fees and expenses,
       reasonable disbursements, expenses and advances incurred
       or made by the Successor Indenture Trustee, including the
       reasonable compensation, disbursements and expenses of the
       Successor Indenture Trustee's agents and counsel; and

(iii) all other amounts, including all indemnification rights,
       that are due or become due to the Noteholders or the
       Successor Indenture Trustee under the Indenture and the
       DISCS.

The Noteholders initially acquired their claims upon their
purchases of the DISCS.  However, some of the Noteholders may
have purchased their DISCS in the secondary market, Mr. Bocchino
says.

Mr. Bocchino maintains that the Successor Indenture Trustee does
not own, as Trustee, any claims or DISCS of the Debtor.

                       About Ambac Financial

Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.

Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code in Manhattan (Bankr.
S.D.N.Y. Case No. 10-15973) on November 8, 2010.  Ambac said it
will continue to operate in the ordinary course of business as
"debtor-in-possession" under the jurisdiction of the Bankruptcy
Court and in accordance with the applicable provisions of the
Bankruptcy Code and the orders of the Bankruptcy Court.

Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy.  AAC is being restructured by state regulators in
Wisconsin.  AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.

Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed $30.05 billion in total assets,
$31.47 billion in total liabilities, and a $1.42 billion
stockholders' deficit, at June 30, 2010.

On an unconsolidated basis, Ambac said in a court filing that
it has assets of ($394.5 million) and total liabilities of
$1.6826 billion as of June 30, 2010.

Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about $1.62 billion.

The Vanguard Group, Inc., holds 5.46% of the stock of Ambac and is
its largest shareholder.

Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP represent the Debtor.  The
Blackstone Group LP is the Debtor's financial advisor.  Kurtzman
Carson Consultants LLC is the claims and notice agent.

Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel to
the Official Committee of Unsecured Creditors.

Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY
NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by Ambac Financial Group Inc.
(http://bankrupt.com/newsstand/or 215/945-7000)


AMBAC FINANCIAL: Time to Remove Actions Extended on Interim
-----------------------------------------------------------
Judge Shelley C. Chapman extended the time by which Ambac
Financial Group, Inc., must file notices of removal of related
civil actions to which it is or may become a party to, through the
later of:

  (i) the date of entry of a final order granting the Action
      Removal Period Extension Motion; or

(ii) the hearing date for the final approval of the Action
      Removal Period Extension Motion, which is currently
      scheduled for February 2, 2011.

The Interim Action Removal Period Extension Order will be without
prejudice to (i) the Debtor's right to request a further
extension of time to file notices of removal of the Civil
Actions; and (ii) to any position the Debtor may take regarding
whether Section 362 of the Bankruptcy Code applies to any Civil
Action, Judge Chapman ruled.

The Debtor separately filed with the Court a proposed final order
extending the Action Removal Period Deadline to the later of
(i) June 7, 2011, or (ii) 30 days after entry of an order
terminating the automatic stay with respect to a certain civil
action sought to be removed.  A full-text copy of the proposed
final order is available for free at:

      http://bankrupt.com/misc/Ambac_PropFORemovalMo.pdf

                       About Ambac Financial

Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.

Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code in Manhattan (Bankr.
S.D.N.Y. Case No. 10-15973) on November 8, 2010.  Ambac said it
will continue to operate in the ordinary course of business as
"debtor-in-possession" under the jurisdiction of the Bankruptcy
Court and in accordance with the applicable provisions of the
Bankruptcy Code and the orders of the Bankruptcy Court.

Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy.  AAC is being restructured by state regulators in
Wisconsin.  AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.

Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed $30.05 billion in total assets,
$31.47 billion in total liabilities, and a $1.42 billion
stockholders' deficit, at June 30, 2010.

On an unconsolidated basis, Ambac said in a court filing that
it has assets of ($394.5 million) and total liabilities of
$1.6826 billion as of June 30, 2010.

Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about $1.62 billion.

The Vanguard Group, Inc., holds 5.46% of the stock of Ambac and is
its largest shareholder.

Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP represent the Debtor.  The
Blackstone Group LP is the Debtor's financial advisor.  Kurtzman
Carson Consultants LLC is the claims and notice agent.

Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel to
the Official Committee of Unsecured Creditors.

Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY
NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by Ambac Financial Group Inc.
(http://bankrupt.com/newsstand/or 215/945-7000)


AMBAC FINANCIAL: Wins OK for KPMG as Tax Consultant
---------------------------------------------------
The Bankruptcy Court approved Ambac Financial Group Inc.'s
employment of KPMG LLP to serve as its tax consultant.  Judge
Shelley C. Chapman, however, clarified that the Debtor is not
authorized to employ KPMG LLP to provide services in connection
with the adversary proceeding commenced by the Debtor against the
Internal Revenue Service absent an agreed upon allocation between
the Debtor and Ambac Assurance Corporation or further order of the
Court on appropriate application for fees and expenses in
connection with the IRS Action.

If and when the Debtor and AAC agree on an allocation relating to
the IRS Action Costs, which allocation will be subject to prior
review and consultation with the Official Committee of Unsecured
Creditors, the Debtor may submit a revised proposed order
approving the employment of KPMG, nunc pro tunc to the Petition
Date, to provide services in connection with the IRS Action
without the need to first notice a further hearing on the
Debtor's Application.

As reported in the Dec. 20, 2010 edition of the Troubled Company
Reporter, As the Debtor's tax consultant, KPMG will provide audit,
tax consulting and bankruptcy administration services, including,
but not limited to these services:

(A) Audit of Consolidated Financial Statements

    (a) Audit of the consolidated balance sheet of the Debtor
        and non-debtor affiliates as of December 31, 2010 and
        2009, the related consolidated statements of operations,
        Stockholders' equity and cash flows for each of the
        years in the three-year period ended December 31, 2010,
        and schedules and notes supporting those financial
        statements prepared in accordance with U.S. generally
        accepted accounting principles; and

    (b) Audit of the internal control over financial reporting
        as of December 31, 2010 in accordance with the standards
        of the Public Company Accounting Oversight Board
        Auditing Standard No. 5;

        -- performing tests of the accounting records and other
           procedures, as KPMG considers necessary in the
           circumstances, to provide a reasonable basis for
           KPMG's opinions;

        -- assessing the accounting principles used and
           significant estimates made by management, and
           evaluating the overall consolidated financial
           statement presentation; and

        -- obtaining an understanding of internal control over
           financial reporting, testing and evaluating the
           design and effectiveness of internal control over
           financial reporting, and performing other procedures
           as KPMG considered necessary in the circumstances.

    (c) Review, in accordance with Statement on Auditing
        Standards No. 100, Interim Financial Information, the
        consolidated balance sheets of AFG as of June 30 and
        September 30, 2010 and March 31, 2011, and the related
        consolidated statements of operations, stockholders'
        equity, and cash flows for the quarterly and year-to-
        date periods then ended and notes, which are to be
        included in the quarterly reports;

    (d) Audits of the statutory statements of admitted assets,
        liabilities and surplus of non-debtor affiliates as of
        December 31, 2010 and 2009, the related statements of
        operations, capital and surplus, and cash flow for each
        of the years in the two-year period ended December, 31,
        2010, and schedules supporting those financial
        statements, prepared in accordance with statutory
        statements of accounting principles;

    (e) Audits of the balance sheets of the non-debtor
        affiliates Juneau and Aleutian, as of December 31,
        2010 and 2009, the related consolidated statements
        of operations, stockholder's equity, and cash flows
        for each of the years in the two-year periods ended
        December 31, 2009, and schedules supporting such
        financial statements, prepared in accordance with U.S.
        generally accepted accounting principles;

    (f) Issuance of a comfort letter if required and requested;

    (g) Report to the Audit and Risk Assessment Committee in
        writing regarding corrected misstatements, uncorrected
        misstatements, significant difficulties encountered with
        the Debtor and other matters required to be communicated
        by auditing standards;

    (h) Read minutes of Audit and Risk Assessment Committee
        meetings for consistency with KPMG's understanding of
        the communications;

    (i) Issue a written report upon audit of Ambac Financial
        Group, Inc. Savings Incentive Plan, including audit of
        financial statements and supplemental schedules of the
        Savings Plan as of December 31, 2010 and 2009, and for
        the years ended December 31, 2010 and 2009;

    (j) Assistance regarding certain events and accounting
        pronouncements, which may have a significant impact on
        KPMG's audit efforts.  Examples of Out-of-Scope Audit
        Services to be evaluated for their impact on KPMG's
        efforts include:

        -- significant acquisitions;

        -- dispositions of businesses;

        -- significant and infrequent transactions with complex
           business implications;

        -- accounting and auditing matters related to this
           bankruptcy case to the extent it results in
           additional audit effort;

        -- change in operating segments or reporting units;

        -- asset impairment analyses;

        -- fresh start accounting and related audit efforts;

        -- review of registration statements or comfort letters
           provided to third parties;

        -- review and comment on comment letters received from
           the United States Securities and Exchange Commission
           and the Office of the Commissioner of Insurance of
           Wisconsin and responses provided to those letters
           related to accounting matters; and

        -- the adoption of new accounting or auditing
           pronouncements, etc.

(B) Tax Consulting Services

    (a) Analysis of Section 382 of the Internal Revenue Code
        issues including updating the existing Section 382
        analysis performed by KPMG, including a sensitivity
        analysis to reflect the impact of the proposed or
        hypothetical equity transactions pursuant to the
        restructuring;

    (b) Analysis of net unrealized built-in gains and losses and
        Notice 2003-65 as applied to the ownership change, if
        any, resulting from or in connection with the
        restructuring;

    (c) Analysis of the Debtor's tax attributes including net
        operating losses, tax basis in assets, and tax basis in
        stock of subsidiaries;

    (d) Analysis of cancellation of debt income, including the
        application of Section 108 of the Internal Revenue Code
        and consolidated tax return regulations relating to the
        restructuring of debt;

    (e) Analysis of the application of the attribute reduction
        rules under Section 108(b) and Section 1.1502-28 of the
        Treasury Regulations;

    (f) Analysis of the tax implications of any internal
        reorganizations and proposal of restructuring
        alternatives;

    (g) Analysis of the tax implications of any dispositions of
        assets or subsidiary stock pursuant to the
        restructuring;

    (h) Analysis of the potential bad debt and retirement tax
        losses; and

    (i) Investigate and review facts and tax issues, as
        requested by Dewey & LeBoeuf LLP, to support Dewey &
        LeBoeuf's representation of the Debtor in the adversary
        proceeding between the Debtor and the Internal Revenue
        Service, Case No. 10-04210, commenced in the Court on
        November 9, 2010.

(C) Bankruptcy Administration Services

    (a) Operational protocols: Support the Debtor's management
        with its operational protocols for bankruptcy reporting;

    (b) Bankruptcy reporting: Support the Debtor's management in
        its preparation of a Statement of Financial Affairs, a
        Schedule of Assets and Liabilities and a Monthly
        Operating Report by debtor entity as well as Rule 26 of
        the Federal Rules of Bankruptcy Procedure, if required;

    (c) Disclosure statement and plan of reorganization: Assist
        in the preparation of financial information required in
        the disclosure statement and plan of reorganization,
        including the pro forma balance sheet reflecting fresh
        start accounting.  KPMG's assistance will depend upon
        the Debtor's direction but tasks may pertain to,
        preparation of detailed financial information, liquidity
        analysis, best interest of creditors' test and plan
        feasibility;

    (d) External responses: Support the Debtor's management in
        its response to requests from the various stakeholders
        in the bankruptcy, including but not limited to the
        Office of the US Trustee for Region 2, and any
        statutorily appointed committees that may be
        established;

     (e) Claims analysis: Support the Debtor's management in its
         response to the claims reconciliation process,
         including matching claims to scheduled liabilities,
         evaluating claims, preparing exhibits to objections,
         and analyzing transfers to determine preferential
         treatment;

     (f) Project planning: Assist with timeline and critical
         path development and tracking;

     (g) Approach and work steps: Assist with the consideration
         of the alternatives in approach, timing, order, and
         adoption dates for fresh start reporting; the
         alternatives for on-going efficient processing of
         detailed accounting records; and the potential
         approaches for updating detailed records to reflect
         changes in values and the new accounting requirements
         subsequent to emergence;

     (h) Status meetings: Coordinate and conduct status update
         meetings with key Debtor's management personnel, for
         all work-streams; and

     (i) Coordination of advisors and key partners: Liaise with
         the Debtor's advisors and key business partners,
         including valuation team, attorneys, bankers, etc,
         throughout the course of the engagement.

In connection with the Integrated Audit, KPMG will provide for
services to be charged at both a fixed rate as well as an hourly
rate.  First, a fixed fee of $2.63 million is applicable to In-
Scope Audit Services, for which KPMG bills AFG on a monthly basis
in equal installments of $219,167 for a period of 12 months for
the Integrated Audit, and a fixed fee of $40,000 is applicable to
the Plan Audit Services.

Of the In-Scope Fixed Fee, $1,550,000 was paid before the
Petition Date.  The Plan Fixed Fee has not yet been paid.  Of the
Fixed Fees, the Debtor is responsible for $68,000, of which
$49,217 was paid prepetition.

With respect to any Out-of-Scope Audit Services to be performed
for the Integrated Audit, KPMG will be paid according its
professionals' hourly rates:

  Audit, Audit-Related & Other Services    Discounted Rates
  -------------------------------------    ----------------
  Partner/Managing Director                  $475 to $575
  Senior Manager/Manager                     $350 to $425
  Staff                                      $215 to $300

While non-debtor Ambac Assurance Corporation pays KPMG out of its
account for the Integrated Audit services, AAC later allocates
certain amounts to the Debtor and respective non-debtor entities
resulting in intercompany claims for the charges for which the
Debtor and non-debtor entities must reimburse AAC.  Thus, $68,000
of the Fixed Fees was allocated to the Debtor, and hourly fees
for Out-Of-Scope Audit Services will be allocated to the Debtor
as applicable.

Although KPMG will not charge for its In-Scope and Plan Audit
Services on an hourly basis, KPMG has informed the Debtor that it
will nonetheless maintain records of time spent by its
professionals in connection with the rendering of the In-Scope
and Plan Audit Services.

KPMG's tax consulting and bankruptcy administration services will
be invoiced to AAC.  AAC will pay KPMG out of its account for
those services and later allocate those amounts to the Debtor and
respective non-debtor entities resulting in intercompany claims
for the charges for which the Debtor and non-debtor entities
must reimburse AAC.  The allocation of the bankruptcy
administration services will be 100% to the Debtor, and the
allocation of the tax consulting services, although dependent
upon the nature of the work done, is anticipated to be 20% to the
Debtor.

KPMG informed the Debtor that the majority of fees to be charged
for tax consulting and bankruptcy administration services reflect
a reduction of approximately 15% to 40% from KPMG's normal and
customary rates, depending on the types of services to be
rendered.  Professional fees for bankruptcy administration
services will not exceed a blended hourly rate of $425, tested on
a monthly basis.  The hourly rates for tax consulting and
bankruptcy services to be rendered by KPMG are:

   Tax Consulting Services               Discounted Rate
   -----------------------               ---------------
   Partner                                   $635
   Managing Director                         $550
   Senior Manager                            $500
   Manager                                   $470
   Senior Associate                          $400
   Associate                                 $275

   Bankruptcy Administration Services    Discounted Rate
   ----------------------------------    ---------------
   Partner/Principal/Managing Director       $565
   Director                                  $550
   Manager                                   $485
   Senior Associate                          $385
   Associate                                 $265
   Intern/Para-Professional                  $115

KPMG also will seek reimbursement for reasonable necessary
expenses incurred.

                       About Ambac Financial

Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.

Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code in Manhattan (Bankr.
S.D.N.Y. Case No. 10-15973) on November 8, 2010.  Ambac said it
will continue to operate in the ordinary course of business as
"debtor-in-possession" under the jurisdiction of the Bankruptcy
Court and in accordance with the applicable provisions of the
Bankruptcy Code and the orders of the Bankruptcy Court.

Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy.  AAC is being restructured by state regulators in
Wisconsin.  AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.

Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed $30.05 billion in total assets,
$31.47 billion in total liabilities, and a $1.42 billion
stockholders' deficit, at June 30, 2010.

On an unconsolidated basis, Ambac said in a court filing that
it has assets of ($394.5 million) and total liabilities of
$1.6826 billion as of June 30, 2010.

Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about $1.62 billion.

The Vanguard Group, Inc., holds 5.46% of the stock of Ambac and is
its largest shareholder.

Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP represent the Debtor.  The
Blackstone Group LP is the Debtor's financial advisor.  Kurtzman
Carson Consultants LLC is the claims and notice agent.

Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel to
the Official Committee of Unsecured Creditors.

Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY
NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by Ambac Financial Group Inc.
(http://bankrupt.com/newsstand/or 215/945-7000)


AMERICAN HOME: Liquidating Trustee Wants Loan Docs. Destroyed
-------------------------------------------------------------
Reuters and Bloomberg News report that federal bankruptcy judges
in Delaware were due to hold separate hearings Monday on requests
by trustees liquidating Mortgage Lenders Network USA and American
Home Mortgage to destroy thousands of boxes or original loan
documents.

Scot J. Paltrow, writing for Reuters, reports that:

     -- Neil Luria, the liquidating trustee for Mortgage Lenders,
        sought Judge Peter Walsh's permission to destroy nearly
        18,000 boxes of records now warehoused by document storage
        company, Iron Mountain Inc.  According to Reuters, Mr.
        Luria said destruction is necessary to eliminate $16,000
        per month in storage costs as he disposes of the last
        assets of the bankrupt company.

     -- Steven Sass, the liquidating trustee for American Home
        Mortgage, sought Judge Christopher Sontchi's permission to
        approve destruction of 4,100 boxes of loan documents
        stored in a dank parking garage beneath the company's
        former headquarters in Melville, Long Island.  Mr. Sass
        stated that the local fire marshal wants the documents
        removed as a fire hazard, and he said the cost of moving
        them would be prohibitive.  In accordance with a 2009
        court order, the bankrupt company earlier had destroyed
        the contents of thousands of other boxes after banks and
        other loan servicers had been given a chance to request
        and pick up particular files.

Reuters says the requests come despite intense concerns that
paperwork critical to foreclosures and securitized investments may
be lost.

Phil Milford and Dawn McCarty, writing for Bloomberg News, report
that the U.S. government objected to Mortgage Lenders' request.
According to Bloomberg, Delaware U.S. Attorney Charles M. Oberly
III argues that Mortgage Lenders' plan "threatens to impair
federal law enforcement efforts."  Mr. Oberly III also told the
judge the company's records "may be relevant to pending federal
criminal investigations into mortgage fraud."

Bloomberg further relates that Mr. Oberly proposed, as an
alternative, to require Mr. Luria to provide government officials
"with notice of the specific documents proposed to be destroyed"
and "an opportunity to respond."

According to Reuters, people involved with the cases said the
overlapping timing of the two hearings Monday is coincidental.

                        About American Home

Based in Melville, New York, American Home Mortgage Investment
Corp. (NYSE: AHM) -- http://www.americanhm.com/-- was a mortgage
real estate investment trust engaged in the business of investing
in mortgage-backed securities and mortgage loans resulting from
the securitization of residential mortgage loans originated and
serviced by its subsidiaries.

American Home Mortgage and seven affiliates filed for Chapter 11
protection on August 6, 2007 (Bankr. D. Del. Case Nos. 07-11047
through 07-11054).  James L. Patton, Jr., Esq., Joel A. Waite,
Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt &
Taylor LLP represent the Debtors.  Epiq Bankruptcy Solutions LLC
acts as the Debtors' claims and noticing agent.  The Official
Committee of Unsecured Creditors selected Hahn & Hessen LLP as
its counsel.  As of March 31, 2007, American Home Mortgage's
balance sheet showed total assets of $20,553,935,000, total
liabilities of $19,330,191,000.

American Home filed a de-consolidated plan of liquidation on
August 15, 2008.  The former home mortgage lender's liquidating
Chapter 11 plan was confirmed in February 2009.

                      About Mortgage Lenders

Middletown, Connecticut-based Mortgage Lenders Network USA Inc. --
http://www.mlnusa.com/-- was once the 15th largest mortgage
lender in the United States.  The Company filed for Chapter 11
protection on February 5, 2007 (Bankr. D. Del. Case No. 07-10146).
Pachulski Stang Ziehl & Jones LLP represents the Debtor.  Blank
Rome LLP represents the Official Committee of Unsecured Creditors.
In the Debtor's schedules of assets and liabilities filed with the
Court, it disclosed total assets of $464,847,213 and total debts
of $556,459,464.

The Honorable Peter J. Walsh approved the Company's liquidating
Chapter 11 plan in February 2009.  A full-text copy of the
Debtor's First Amended Liquidating Plan under Chapter 11 of the
Bankruptcy Code, dated December 19, 2008, is available at
http://is.gd/1a3YGat no charge.


APPLESEED'S INTERMEDIATE: Organizational Meeting on Jan. 28
-----------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on January 28, 2011, at 10:00 a.m.
in the bankruptcy case of Appleseed's Intermediate Holdings LLC,
et al.  The meeting will be held at DoubleTree Hotel Wilmington,
700 King Street, Wilmington, Delaware 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.

                  About Appleseed's Intermediate

Based in Beverly, Massachusetts, Appleseed's Intermediate Holdings
LLC, aka Appleseed's Intermediate Holdings, Inc., aka 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.

Appleseed's is owned by Golden Gate Capital Corp., which also
hold stakes in retailers Express Inc., Eddie Bauer Holdings Inc.
and Zale Corp.

Appleseed's Intermediate and its affiliates filed for Chapter 11
bankruptcy protection on January 19, 2011 (Bankr. D. Del. Lead
Case No. 11-10160).  Richard M. Cieri, Esq., Joshua A. Sussberg,
Esq., at Brian E. Schartz, at Kirkland & Ellis LLP, serves as the
Debtors' bankruptcy counsel.  Domenic E. Pacitti, Esq., at Klehr
Harrison Harvey Branzburg LLP, serves as local counsel to the
Debtors.  Moelis & Company LLC is the Debtors' investment banker
and financial advisor.  Alvarez & Marshal North America, LLC, is
the Debtors' restructuring advisor.  Pricewaterhousecoopers LLP is
the Debtors' independent auditor.  Kurtzman Carson Consultants LLC
is the Debtors' notice and claims agent.  Appleseed's Intermediate
estimated assets at $100 million to $500 million and debts at
$500 million to $1 billion in its Chapter 11 petition.


APPLESEED'S INTERMEDIATE: Has OK to Hire Kurtzman as Claims Agent
-----------------------------------------------------------------
Appleseed's Intermediate Holdings LLC, et al., sought and obtained
authorization from the U.S. Bankruptcy Court for the District of
Delaware to employ Kurtzman Carson Consultants LLC as notice,
claims and balloting agent.

KCC will, among other things:

     a. prepare and serve notices in the Debtors' Chapter 11
        cases;

     b. receive, examine and maintain copies of proofs of claim
        and proofs of interest filed in the Debtors' Chapter 11
        cases;

     c. maintain an official claims register in the Debtors'
        Chapter 11 cases by docketing all proofs of claim and
        proofs of interest in a claims database; and

     d. provide access to the public for examination of claims and
        the claims register at no charge.

KCC will charge the Debtor for its services, expenses and supplies
at the rates or prices set by KCC and in effect as of the date of
the service agreement in accordance with the KCC fee structure.
To the extent permitted by applicable law, KCC will receive a
retainer in the amount of $30,000 that may be held by KCC as
security for the Debtor's payment obligations under the agreement.

A copy of the Service Agreement is available for free at:

              http://ResearchArchives.com/t/s?7277

Albert H. Kass, Vice president of Corporate Restructuring Services
for KCC, assured the Court that the firm is a "disinterested
person" as that term defined in Section 101(14) of the Bankruptcy
Code.

                  About Appleseed's Intermediate

Based in Beverly, Massachusetts, Appleseed's Intermediate Holdings
LLC, aka Appleseed's Intermediate Holdings, Inc., aka 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.

Appleseed's is owned by Golden Gate Capital Corp., which also
hold stakes in retailers Express Inc., Eddie Bauer Holdings Inc.
and Zale Corp.

Appleseed's Intermediate and its affiliates filed for Chapter 11
bankruptcy protection on January 19, 2011 (Bankr. D. Del. Lead
Case No. 11-10160).  Richard M. Cieri, Esq., Joshua A. Sussberg,
Esq., at Brian E. Schartz, at Kirkland & Ellis LLP, serves as the
Debtors' bankruptcy counsel.  Domenic E. Pacitti, Esq., at Klehr
Harrison Harvey Branzburg LLP, serves as local counsel to the
Debtors.  Moelis & Company LLC is the Debtors' investment banker
and financial advisor.  Alvarez & Marshal North America, LLC, is
the Debtors' restructuring advisor.  Pricewaterhousecoopers LLP is
the Debtors' independent auditor.  Appleseed's Intermediate
estimated assets at $100 million to $500 million and debts at
$500 million to $1 billion in its Chapter 11 petition.


ATA AIRLINES: Dist. Ct. Rejects Bid for New Trial in FedEx Suit
---------------------------------------------------------------
The Indianapolis Star's Carrie Ritchie reports that U.S. District
Court Judge Richard Young will not allow a new trial in a lawsuit
that netted nearly $66 million in damages for ATA Airlines.

As reported by the Troubled Company Reporter on October 28, 2010,
Patrick Fitzgerald, writing for Dow Jones' Daily Bankruptcy
Review, said a federal jury in Indianapolis, Indiana, ruled that
FedEx Corp. should pay $66 million for canceling a military
shipping contract with ATA that accounted for most of ATA's
revenue and directly led to ATA's decision to shut down.  The
Indianapolis Star says the jury determined the breach of contract
by FedEx cost ATA about $21.99 million in lost net profits in 2008
and $43.99 million in 2009.

The Indianapolis Star reports FedEx claimed the jury's verdict
went against evidence presented at trial.  FedEx also asked the
judge to reconsider the nearly $66 million in damages the jury
awarded ATA.

According to The Indianapolis Star, Judge Young held that the
jury's verdict was supported by the evidence and that the damages
awarded were appropriate based on ATA's calculation of losses.

The Indianapolis Star notes FedEx could still appeal to the U.S.
Circuit Court of Appeals for the Seventh Circuit in Chicago.

                        About ATA Airlines

Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., was a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military.

ATA Airlines and its affiliates filed for Chapter 11 protection on
October 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874).  The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on January 31, 2006.  The Debtors'
emerged from bankruptcy on February 28, 2006.

Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy.  The remaining ATA affiliates that were not
substantively consolidated in the Company's first bankruptcy case
were sold or otherwise liquidated.

ATA Airlines filed for Chapter 22 (Bankr. S.D. Ind. Case No.
08-03675) on April 2, 2008, citing the unexpected cancellation of
a key contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business.  ATA discontinued all
operations subsequent to the bankruptcy filing.  ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.

The Debtor was represented in its Chapter 22 case by Haynes and
Boone, LLP, and Baker & Daniels, LLP, as bankruptcy counsel.

The United States Trustee for Region 10 appointed five members to
the Official Committee of Unsecured Creditors.  Otterbourg,
Steindler, Houston & Rosen, P.C., served as bankruptcy counsel to
the Committee.  FTI Consulting, Inc., acted as its financial
advisors.

ATA Airlines submitted to the Court its Chapter 11 Plan of
Reorganization and accompanying Disclosure Statement on
December 12, 2008, two weeks after it completed the sale of
its key assets to Southwest Airlines Inc.  The First Amended
Chapter 11 Plan was confirmed on March 26, 2009.  The Plan became
effective March 31, 2009.


ATLANTIC SOUTHERN: To Voluntarily Delist Common Stock from Nasdaq
-----------------------------------------------------------------
Atlantic Southern Financial Group, Inc., the parent company of
Atlantic Southern Bank, announced its intent to voluntarily delist
the Company's common stock from the Nasdaq Stock Market.  The
Board determined the costs, expenses and administrative burden of
maintaining the listing outweighed the benefits, given the level
of trading activity in the common stock and the expenses
associated with continued listing, including listing fees and
compliance costs relating to certain issues.  The Company has
immediately proceeded with delisting by providing a written notice
to Nasdaq on January 20, 2011 of its intention to delist and will
file a Form 25 with the Securities Exchange Commission on January
31, 2011.  The Company anticipates that Nasdaq will suspend
trading in the common stock within ten days of submission of its
written notice and expects the delisting from Nasdaq to become
effective February 10, 2011, ten days after filing its Form 25.
Following clearance by the Financial Industry Regulatory Authority
of a Form 211 application filed by a market maker in the Company's
common stock, the Company expects that its shares will be quoted
on the OTC Bulletin Board.  The Company will remain subject to the
periodic reporting requirements of the Securities Exchange Act of
1934, as amended.

The Company has previously reported its receipt of notices from
Nasdaq indicating that the Company is not in compliance with the
following Nasdaq Global Market listing requirements: (i)
Marketplace Rule 5450(b)(1)(C), which requires a minimum market
value of publicly held shares of $5,000,000; and (ii) Marketplace
Rule 5450(a)(1), which requires a minimum closing bid price of
$1.00 per share.  The Company has been given until January 31,
2011 and June 8, 2011 to comply with the MVPHS and bid price
requirements, respectively.

After delisting, the Company will continue to provide investors
access to information filed with the Securities Exchange
Commission or other information required to be made public under
securities laws on the Atlantic Southern Bank Web site at
http://www.atlanticsouthernbank.com/

                      About Atlantic Southern

Macon, Ga.-based Atlantic Southern Financial Group, Inc. (NASDAQ:
ASFN) operates nine banking locations in the middle Georgia
markets of Macon and Warner Robins, five locations in the coastal
markets of Savannah, Darien, Brunswick, one location in the south
Georgia market of Valdosta, Georgia and one location in the
northeast Florida market of Jacksonville, Florida.  The Company
specializes in commercial real estate and small business lending.

The Company's balance sheet at September 30, 2010, showed
$852.6 million in total assets, $832.4 million in total
liabilities, and stockholders' equity of $20.2 million.

"As a result of the extraordinary effects of what may ultimately
be the worst economic downturn since the Great Depression, the
Company's and the Bank's capital have been significantly
depleted," the Company said in its Form 10-Q for the quarter ended
Sept. 30, 2010.  The Company recorded a net loss of $59.2 million
in 2009, and a net loss of $9.3 million in the first nine months
of 2010.

The Company's ability to raise additional capital will depend on
conditions in the capital markets at that time, which are outside
its control, and on its financial performance.  Accordingly, the
Company cannot be certain of its ability to raise additional
capital on terms acceptable to them.  The Company's inability to
raise capital or comply with the terms of the Order [to Cease and
Desist] raises substantial doubt about its ability to continue as
a going concern."

On September 11, 2009, the Company's wholly-owned subsidiary bank,
Atlantic Southern Bank, entered into a Stipulation and Consent to
the Issuance of an Order to Cease and Desist with the Federal
Deposit Insurance Corporation and the Georgia Department of
Banking and Finance, whereby the Bank consented to the issuance of
an Order to Cease and Desist.


ATTACHMATE CORP: S&P Puts 'BB-' Rating on Proposed $865MM Facility
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its 'B' rating outlook
on Seattle-based host connectivity and systems and security
management provider Attachmate Corp. to positive from stable.  All
existing ratings on the Company were affirmed.

Additionally, S&P assigned a 'BB-' issue-level rating and a '1'
recovery rating to the Company's proposed $865 million first lien
facility, consisting of a new $40 million revolving credit
facility due 2016 and a $825 million term loan.  The '1' recovery
rating indicates S&P's expectation of very high (90%-100%)
recovery in the event of a payment default.

The Company also has a proposed $225 million second lien, which
S&P does not rate.

The Company intends to use the proceeds, along with about
$800 million of equity from existing shareholders, to acquire the
operations of Novell Inc. and to extinguish approximately $610
million of Attachmate's existing debt.

The ratings reflect S&P's expectation that the combined entity
will likely benefit from operational and end-market synergies, but
that operational integration risk will be substantial as Novell is
nearly 3x the size of Attachmate. For 2009, Attachmate's stand-
alone revenues were approximately $300 million, compared with
$860 million for Novell.  Attachmate's growth has been stagnant
and Novell's operations have been under pressure, with revenues
down approximately 6% year over year (year to date), and down
almost 10% in fiscal 2009.

While uncertainty about the timing and execution of a strategic
buyer for Novell may have led some customers to delay purchasing
decisions, Attachmate still faces the challenge of reversing the
negative revenue trend at Novell.  S&P also notes that the
proposed financing could be a deleveraging transaction given the
capital contributions from existing shareholders and a combined
EBITDA base that will likely be improved by cost rationalization
at Novell.  Operating lease-adjusted leverage for stand-alone
Attachmate was 5.5x at Sept. 30, 2010, and will likely be into the
low-4.0x range as a combined Company, before even moderate cost
savings.


AVIV HEALTHCARE: Moody's Rates Proposed Sr. Unsec. Notes 'B1'
-------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to the prospective
senior unsecured notes offering of Aviv Healthcare Properties
Limited Partnership.  Moody's has also assigned a Ba3 corporate
family rating to Aviv.  The notching between the corporate family
rating and the senior unsecured rating reflects significant
proportion of secured debt in Aviv's capital structure which is
expected to remain in the medium term.  The rating outlook is
stable.  This is the first time Moody's has rated Aviv.

These ratings were assigned with a stable outlook:

  -- Aviv Healthcare Properties Limited Partnership -- corporate
     family rating at Ba3; prospective senior unsecured debt
     rating at B1.

Aviv's Ba3 corporate family and B1 senior unsecured ratings
reflect the REIT's successful track record and managerial
expertise, as well as small size and private company status.
Aviv's focus on skilled nursing facilities is a key credit concern
due to the relatively low profitability of this sector, in
addition to heavy dependence on government reimbursements.
Moody's acknowledges, however, that Aviv has been strategically
addressing this risk by diversifying its portfolio among 24 states
thereby reducing the likelihood of exposure to severe budget cuts
in any one state. Positively, Aviv has been strategic in choosing
states with more predictable reimbursement regimes and overall
more favorable operating environment.  Aviv's portfolio is further
diversified by operator with over 32 SNF operators net leasing
Aviv's properties.  While many of Aviv's operators are smaller
private firms, this is typical for the highly fragmented SNF
industry.  Aviv has strategically cultivated long-term
relationships with its tenants for many of which it is the only or
the largest landlord.  The REIT has reaped the benefits of this
strategy in terms of de-minimus lease rollovers and successful
collections.  Also positively, Aviv maintains master or cross-
default leases with its operators which provide additional
structural protection.

Aviv's liquidity is adequate following a substantial equity
investment by Lindsay Goldberg LLC in September 2010, and is
expected to be strengthened further with the addition of a
$25 million revolver simultaneously with the proposed $200 million
8-year notes offering.  The proceeds from the unsecured debt
issuance will be used to repay approximately $30 million
outstanding on Aviv's $100 million acquisition facility due 2015
and to pay down its $405 million term loan due 2015.  Positively,
Aviv has no near-term maturities; its capital commitments are
minor, and it anticipates Lindsay Goldberg LLC to make additional
equity contributions to its future acquisitions.

Aviv's credit profile is solid for the rating category with
effective leverage of approximately 54% and secured leverage
expected to decline closer to 31% following the note issuance.
Despite increased interest cost of the bond offering, Aviv's fixed
charge is expected to be over 2.4x. Positively, Aviv has no joint
ventures.

The stable outlook reflects Aviv's predictable cash flow from its
long term triple net leases and no debt maturities until 2015.
These credit positives counterbalance Aviv's small size and
operating focus on a relatively less profitable sector subject to
uncertainty associated with government reimbursement, as well as
its private company status.

A rating upgrade would be difficult in the short-term, and would
depend on the REIT's size increasing to over $1 bn in terms of
gross assets, with secured debt under 30% of gross assets and
fixed charge consistently above 2.5x.  Improvement in the size and
quality of Aviv's unencumbered pool, as well as ample liquidity at
all times, would also be needed for an upgrade.

Negative rating movement would most likely be precipitated by a
deterioration in Aviv's credit profile beyond current levels, any
liquidity concerns, or operational challenges resulting in a
significant decline in the level of rent collections.

This is the first time Moody's has rated Aviv Healthcare
Properties Limited Partnership.

The principal methodology used in this rating was Global Rating
Methodology for REITs and Other Commercial Property Firms
published in July 2010.

Aviv is a private, Chicago-based real estate company, organized as
a REIT, with a primary focus on owning, acquiring and developing
skilled nursing facilities.  Aviv generates its revenues by
entering into long-term triple-net leases with local, regional and
national operators throughout the US.


AXION INTERNATIONAL: Appoints Steve Silverman as New CEO
--------------------------------------------------------
Axion International announced that its Board of Directors has
appointed Axion's current President and COO, Steve Silverman, as
its new Chief Executive Officer while retaining his title of
President, effective immediately.

Jim Kerstein, Axion's current Chief Executive Officer and Chief
Technology Officer, will continue as CTO and focus increasingly on
developing new products and applications for Axion's unique
recycled plastic structural material while promoting the strategic
relationships that have proven to be the foundation of the
business.

"This is an exciting period for Axion.  As we move into a high-
growth phase of our development I am pleased to hand over the
position of CEO to such a highly qualified management executive
thereby allowing myself to focus on continued business and
technology development," stated Mr. Kerstein.  "Steve's
organizational management and decision-making experience across
various emerging companies will provide Axion and its shareholders
with a new and exceptionally dynamic leader.  As proven with his
successful management style and various new contract-wins since
his appointment as Axion's President and COO, I have absolute
confidence that Steve is the executive to fulfill our strategic
goals as we position Axion as a major building supply company.  I
look forward to working with Steve to continue building Axion."

Since joining Axion as President and COO in October, 2010, Mr.
Silverman has been instrumental in laying the foundation for
Axion's product management initiatives, and developing strong
partnerships that will allow Axion to achieve growth going
forward.  In his prior experience Mr. Silverman was a major
contributor to a five-fold increase in revenues at Archbrook
Laguna, LLC.  He led the company's diversification strategy,
formed unique joint ventures with international companies, and
held a key role in the company's organizational restructuring and
long-term strategic development.  He also led the merger team that
integrated BDI and Laguna into one company.

"I am honored and excited to accept the appointment of Axion's
Chief Executive Officer and I couldn't agree more that we are
entering an exciting phase in Axion's development," said Mr.
Silverman.  "Jim and the company have done a tremendous job
developing Axion's unique recycled plastic technology with Rutgers
University and proving its efficacy across numerous industrial
applications, which in many respects is the most difficult aspect
of developing an innovative product.  Moving forward we plan to
further strengthen our capital structure and product management
initiatives, while simultaneously accelerating our growth by
bringing Axion's game-changing structural composites to mass
market.  Building upon our prior success, Axion will continue to
develop strong partnerships and drive our proven materials into
widespread acceptance across the rail, marine and heavy road and
bridge-building industries.  As 2011 unfolds, I look forward to
leveraging Axion's proven industry performance to become the
leading provider of alternative structural building products, all
while maintaining a keen focus on revenue growth and an
unequivocal commitment to shareholder value."

In addition to appointing Steve Silverman as Axion's new Chief
Executive Officer, the Board of Directors has approved a change of
Axion's fiscal year-end from September 30 to December 31 to bring
the company in line with a more traditional financial reporting
calendar.  The Company anticipates filing its Form 10K for the
transition period ended December 31, 2010, within the required
period.

Developed in conjunction with Rutgers University's Materials
Sciences and Engineering Department, Axion's Recycled Structural
Composite is designed from 100% recycled plastics and is used in
structural applications such as composite railroad ties, I-beams,
pilings, bulkhead and cross beams. RSC is inert and contains no
toxic materials.  It will never leach, warp and is impervious to
insect infestation.  Because it is lighter than traditional
materials, transporting RSC is less expensive and reduces energy
costs.  In addition, RSC is completely recyclable at the end of
its functional life.

                     About Axion International

New Providence, N.J.-based Axion International Holdings, Inc.
(OTC BB: AXIH) -- http://wwwaxionintl.com/-- is a structural
solution provider of cost-effective alternative infrastructure and
building products.  The Company's "green" proprietary technologies
allow for the development and manufacture of innovative structural
products made from virtually 100% recycled consumer and industrial
plastics.

The Company's balance sheet at Sept. 30, 2010, showed
$1.7 million in total assets, $2.1 million in total liabilities,
and a $439,089 stockholders' deficit.

Jewett, Schwartz, Wolfe and Associates, in Hollywood, Florida,
expressed substantial doubt about the Company's ability to
continue as a going concern, following the Company's results for
the fiscal years ended September 30, 2009 and 2010.  The
independent auditors said that the Company's need to seek new
sources or methods of financing or revenue to pursue its business
strategy, raise substantial doubt about the Company's ability to
continue as a going concern.


BANNING LEWIS: Bankruptcy Won't Affect Water Supply
---------------------------------------------------
KRDO's Scott Harrison reports it is unclear whether the Banning
Lewis Ranch housing development in east Colorado Springs,
Colorado, will build 60,000 homes as expected, but some citizens
worry it will mean having to supplement, through higher water
rates, the $880 million cost of the Southern Delivery water supply
system.

According to Mr. Harrison, Colorado Springs Utilities, however,
said there's no cause for concern.  The Utilities' spokeswoman
Janet Rummel said rates will not change beyond the 12% annual
increase all customers must pay through 2016, and the Southern
Delivery System remains on schedule to begin pumping water in
2017.

According to the report, Ms. Rummel describes the Banning Lewis
bankruptcy as a short-term situation that should gradually improve
as the economy improves, growth continues and demand for water
climbs.  The utility already provides water to more than 200 homes
in the development.

As reported by the Troubled Company Reporter on January 6, 2011,
Judge Kevin J. Carey authorized Banning Lewis to conduct sales of
building lots under Section 363 of the Bankruptcy Code.  KeyBank
National Association -- as administrative agent under a senior
secured revolving credit agreement dated Sept. 7, 2007, with the
Debtors -- consented to the sale of the lots free and clear of any
lien.  The Debtors were authorized and empowered, but not
required, to honor Banning Lewis Ranch Development I & II LLC's
pre- and postpetition sale contracts.  The sale proceeds will be
used to pay the customary costs of each closing including state
and county transfers taxes, title and escrow fees, legal and
recording fees, charges for preparation of deeds and other
documents.

                      About Banning Lewis

Banning Lewis Ranch Co. is the owner of the undeveloped portion of
a 21,000-acre ranch in Colorado Springs, Colo.   Banning Lewis
Ranch is a master-planned community in Colorado Springs, Colorado.
The first section built, the 350-acre Northtree Village, opened in
September 2007 and will have 1,000 homes priced from the high
$100,000s to the mid-$300,000s.

Banning Lewis Ranch filed for Chapter 11 bankruptcy protection
from creditors on October 28, 2010 (Bankr. D. Del. Case No.
10-13445).  It estimated assets of $50 million to $100 million and
debts of $100 million to $500 million in its Chapter 11 petition.

An affiliate, Banning Lewis Ranch Development I & II, LLC, also
filed for Chapter 11 (Bankr. D. Del. Case No. 10-13446).

Kevin Scott Mann, Esq., at Cross & Simon, LLC, serves as counsel
to the Debtors.  Edward A. Phillips of Eisner Amper LLP has been
retained as the Company's chief restructuring officer.


BERNARD L MADOFF: Ponzi Victims Sue U.S. for SEC's Negligence
-------------------------------------------------------------
David Glovin at Bloomberg News reports that victims of Bernard L.
Madoff's Ponzi scheme sued the U.S. government, alleging
negligence on the part of the U.S. Securities and Exchange
Commission.  The lawsuit filed January 25 in Manhattan federal
court by nine investors in Bernard L. Madoff Investment Securities
LLC follow similar suits also assailing the SEC, which failed to
detect Mr. Madoff's multibillion-dollar fraud until he turned
himself in.

"The SEC must be held accountable and responsible for its own
negligent actions and inactions that directly and proximately
caused the loss of billions of investor funds," the complaint
says.

The case is Applestein v. U.S., Case No. 11-cv-521 (S.D.N.Y.).

                      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 TREE: Files for Chapter 7 Liquidation
-----------------------------------------
The Orlando Sentinel reports that Ormond Beach, Florida-based Big
Tree Daytona Properties LLC on Jan. 19 filed for liquidation under
Chapter 7 of the Bankruptcy Code.  The Company disclosed $950,000
in assets, and $651,000 in liabilities.  A meeting of creditors is
set for Feb. 25, 2011.


BLOCKBUSTER INC: Court Denies Equityholders' Exam on Valuation
--------------------------------------------------------------
Bankruptcy Judge Burton Lifland denied a request by an Ad Hoc
Committee of Equity Security Holders to conduct an examination of
Blockbuster Inc. and its units pursuant to Rule 2004 of the
Federal Rules of Bankruptcy Procedure.

The Ad Hoc Equity Committee held that the value of the Debtors'
enterprises is worth considerably more than the $1.2 billion value
line set by the Debtors.  Counsel to the Committee, Paul Rachmuth,
Esq., at Gersten Savage LLP, in New York, relates that the Debtors
have represented in various filings in the bankruptcy proceeding
that the value of their estates are less than their debts.
Contrary to the Debtors' assertions, the Ad Hoc Committee believes
that the value of the Debtors' enterprises is worth considerably
more than the $1.2 billion value line set by the Debtors.
Unfortunately, Mr. Rachmuth asserted, the public information
available to the Ad Hoc Committee is sufficiently opaque so as to
make an accurate valuation -- and hence an investment decision --
impossible.

Judge Lifland, however, believes that there is very little value
in Blockbuster, at least that has been shown, Caroline Humer of
Reuters reports.

"It's pretty hard to say that this debtor is anything but
insolvent," Reuters quoted Judge Lifland as saying, adding that he
wondered to what lengths Blockbuster would need to go to continue
operating beyond the three-month extension he had just awarded for
lease negotiations.

                       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: Lease Decision Deadline Extended to April 21
-------------------------------------------------------------
Bankruptcy Judge Burton Lifland extended Blockbuster Inc. and its
units' time to assume or reject their unexpired leases through and
including the earlier of (i) April 21, 2011, and (ii) entry of an
order confirming a Chapter 11 plan of reorganization, provided
that the assumption or rejection of Unexpired Leases pursuant to a
Plan confirmed prior to April 21, 2011, may become effective on
the effective date of the Plan, which assumption or rejection of
Unexpired Leases will not be later than April 21 or the later
deadline as may be agreed to by each applicable landlord pursuant
to Section 365(d)(4)(B)(ii).

The extension is without prejudice to the right of the Debtors to
request, with the prior written consent of the lessor, further
extensions of the time to assume or reject their Unexpired Leases
as provided in Section 365(d)(4)(B) of the Bankruptcy Code.

The Debtors previously told the Court that a number of the
objections against the request have been resolved.  Oyster Point
Plaza LLC and Shelby Creek, L.L.C., also informed the Court of the
withdrawal of their objections.

                       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: Wins OK to Continue Store Closing Sales
--------------------------------------------------------
Judge Burton Lifland granted Blockbuster Inc. and its units '
request to continue conducting store closing sales.

All objections to the request that have not been withdrawn,
waived, settled, or specifically addressed in the order, and all
reservations of rights included in those objections, are overruled
in all respects on the merits and denied.

Prior to the entry of the order, the Debtors told Judge Lifland
that they have reviewed the objections against the Store Closing
Motion and have revised the proposed order and Store Closing Sales
Procedures in an effort to resolve the Objections.  The Debtors
told the Court they expect a majority of the Objections to be
resolved by the time the Court hears their request.

The Court also approved the Store Closing Sales Procedures,
provided that the Debtors and landlords are authorized to enter
into agreements modifying the Store Closing Sales Procedures
without further Court order, and provided further that the
agreements do not have a material adverse effect on the Debtors or
their bankruptcy estates.

A copy of the approved Store Closing Sales Procedures is available
for free at:

     http://bankrupt.com/misc/BBI_StoreClosing_Procedures.pdf

Pursuant to Section 363(f) of the Bankruptcy Code, the assets
being sold pursuant to the Store Closing Sales and Bulk Inventory
Sales will be sold free and clear of any and all mortgages,
security interests, liens, encumbrances or other claims, including
the liens and security interests of the DIP Lenders, with those
Liens, if any, attaching to the proceeds.

The Court also allowed the Closing Stores to "go-dark" after the
Store Closing Sales and remain "dark" despite any lease
restriction to the contrary, and to hang signs and interior or
exterior banners advertising the Store Closing Sales in accordance
with the Store Closing Sales Procedures or as otherwise agreed
between the Debtors and the landlords.

In resolution of the objections of the Taxing Authorities, Judge
Lifland ruled that for any Closing Store within their
jurisdiction, the Debtors will maintain, as adequate protection
for the secured claims of the Tax Authorities, a cash reserve in
an amount equal to the sum of (i) ad valorem taxes assessed and
unpaid as of the date of the Store Closing Sale for the Closing
Stores, and (ii) for ad valorem taxes not yet assessed but for
which Ad Valorem Liens have attached prior to the date of the
Store Closing Sale, an amount based on the prior year's assessed
ad valorem taxes for the Closing Stores.

                       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)


CARIS DIAGNOSTICS: Moody's to Keep 'B2' Corporate Rating
--------------------------------------------------------
Moody's Investors Service commented that Caris Diagnostics, Inc.'s
movement to seek an amendment to its credit facility has no
immediate impact on the company's ratings or outlook, including
the B2 Corporate Family Rating and B3 Probability of Default
Rating.  If the company can complete the necessary amendment to
prevent a breach of the financial covenants, Moody's would expect
to maintain the current ratings and stable rating outlook.

However, Moody's could take negative rating action if the
amendment cannot be completed timely.  At that time, Moody's would
also consider any other options the company may have to remedy
non-compliance with the required covenant levels.

Moody's last rating action on Caris was on January 14, 2010, when
Moody's assigned the initial ratings to the company, including the
B2 Corporate Family Rating.

The principal methodologies used in this rating were Global
Business & Consumer Service Industry published in October 2010 and
Loss Given Default for Speculative-Grade Non-Financial Companies
in the U.S., Canada and EMEA published in June 2009.

Caris Diagnostics, Inc., headquartered in Irving, Texas, is a
privately owned provider of anatomic pathology laboratory
services, with a focus on gastrointestinal pathology, urological
pathology, dermatopatholgy and hematopathology.  The company
offers testing and information services used by physicians in the
detection, diagnosis, evaluation and treatment of cancer and other
medical conditions.  The company serves approximately 5,000
physicians throughout the United States who primarily treat
patients in outpatient settings.


CHATEAU DE VILLE: Combined Hearing on Plan & DS Set for Feb. 4
--------------------------------------------------------------
Chateau de Ville, LLC, has filed with the U.S. Bankruptcy Court
for the Western District of Washington a combined plan and
disclosure statement in its Chapter 11 case.

The hearing to the disclosure statement and confirm the Plan will
be held on February 4, 2011, at 9:30 a.m., before Judge Marc
Barecca.  Objections to the disclosure statement or to the
confirmation of the Plan must be filed with the Court not later
than January 28, 2011.

Payments and distributions under the Plan will be funded by the
sales of the units as proposed in pending motions before the
Court.

There is only one secured creditor: First-Citizens Bank and Trust
Company (Class 4).  The Debtor has put together a schedule for
liquidating the remaining 47 condominium units at the Chateau De
Ville that will pay off the outstanding debt owed to First-
Citizens Bank and Trust Company in full.  It is based on a pricing
structure that reduces the pre-petition asking prices by an
average of 36% for the remaining one-bedroom units and an average
of 26% for the two-bedroom units.

General unsecured creditors (Class 5) include eight subcontractors
who hold liens against the Chateau De Ville property and two deed
of trust holders who are subordinated to First Citizens Bank.
Under Section 506, these claims are deemed unsecured, as the
rights of these creditors in the Chateau De Ville property are
junior to the rights held by First-Citizens Bank and Trust Company
and therefore have no equity to attach to their liens, rendering
the claims unsecured.  After the payment of all administrative
claims (Class 1), priority tax claims (Class 3) and secured claims
(Class 4), it is anticipated that there will be no funds available
to pay unsecured creditors (Class 5).  In the event the sale of
units at the Chateau De Ville produces revenues in excess of that
needed to satisfy Class 1 Claims, Class 3 Claims and Class 4
Claims, those funds would be distributed to Class 5 unsecured
creditors pro rata.  To the extent that the Debtor does not retain
any property that has a value in excess of the exemptions allowed
by law, then the balances of all Class 5 claims will be
discharged.

There are no known Priority Pre-petition Wage Claims (Class 2)
creditors.

The Debtor believes that general unsecured creditors in Class 5,
which includes the subordinated lien holders, are impaired and
that holders of claims in each of these classes are therefore
entitled to vote to accept or reject the Plan.  The Debtor
believes that Class 4 First Citizens Bank and Trust is unimpaired
and that holders of claims in each of these classes, therefore, do
not have the right to vote to accept or reject the Plan.

Classes 1, 2, and 3 are unimpaired under the Plan.  Class 6 is the
debtor, Chateau de Ville LLC.  The Plan is silent as to the
treatment of this Class.

A copy of the combined Plan of Reorganization and Disclosure
Statement is available for free at:

         http://bankrupt.com/misc/CDV.combinedPlanDS.pdf

Renton, Washington-based Chateau de Ville LLC was formed to
develop a multi-unit residential building on a parcel of raw land
that it owned in downtown Renton.  Today, 36 units of 50
individual units in the building are fully completed.  The Company
filed for Chapter 11 bankruptcy protection on September 30, 2010
(Bankr. W.D. Wash. Case No. 10-21648).  Larry B. Feinstein, Esq.,
at Vortman & Feinstein, assists the Debtor in its restructuring
effort.  In its schedules, Chateau de Ville disclosed $12,000,000
in assets and $10,106,000 in liabilities as of the petition date.


CHATEAU DE VILLE: Court Sets February 25 as Claims Bar Date
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Washington
set February 25, 2011, as deadline for creditors of Chateau de
Ville, LLC, to file proofs of claim in the Debtor's Chapter 11
case.

Proofs of claim should be filed with the Clerk, U.S. Courthouse,
700 Stewart Street, Room 6301, Seattle, WA 98101.

Renton, Washington-based Chateau de Ville LLC was formed to
develop a multi-unit residential building on a parcel of raw land
that it owned in downtown Renton.  Today, 36 units of 50
individual units in the building are fully completed.  The Company
filed for Chapter 11 bankruptcy protection on September 30, 2010
(Bankr. W.D. Wash. Case No. 10-21648).  Larry B. Feinstein, Esq.,
at Vortman & Feinstein, assists the Debtor in its restructuring
effort.  In its schedules, Chateau de Ville disclosed $12,000,000
in assets and $10,106,000 in liabilities as of the petition date.


CHATEAU DE VILLE: Motion to Sell 6 Units at Renton Property Denied
------------------------------------------------------------------
On January 19, 2011, the U.S. Bankruptcy Court for the Western
District of Washington, after a finding that cause does not exist
to grant the relief being requested, denied the motion of Chateau
de Ville, LLC, to sell Units 410, 207, 205, 404, 411, and 312 at
its multi-unit residential building located at Williams Avenue
South, in Renton, Washington.

Secured Creditor Janes Gypsum Floors Inc. objected to the motion,
as did Brotherton Painting, Inc.  The Court gave no additional
details as to its reasons for the denial of the motion.

Renton, Washington-based Chateau de Ville LLC was formed to
develop a multi-unit residential building on a parcel of raw land
that it owned in downtown Renton.  Today, 36 units of 50
individual units in the building are fully completed.  The Company
filed for Chapter 11 bankruptcy protection on September 30, 2010
(Bankr. W.D. Wash. Case No. 10-21648).  Larry B. Feinstein, Esq.,
at Vortman & Feinstein, assists the Debtor in its restructuring
effort.  In its schedules, Chateau de Ville disclosed $12,000,000
in assets and $10,106,000 in liabilities as of the petition date.


CIENA CORP: S&P Affirms 'B' Corporate; Outlook Now 'Negative'
-------------------------------------------------------------
Standard & Poor's Rating Services affirmed its 'B' corporate
credit and senior unsecured ratings on Linthicum, Md.-based
communications networking provider Ciena Corp.  At the same
time, S&P removed the ratings from CreditWatch with negative
implications, where they were placed on Oct. 12, 2010.  The
outlook is negative.

"The rating reflects our expectation that the MEN business
integration will be fully completed during the fiscal year and
that additional restructuring expenses remain moderate," said
Standard & Poor' credit analyst William Backus.  "We expect that
recent sales momentum will be sustained and that free operating
cash flows will become nominally positive.  We believe that
EBITDA generation will improve modestly throughout the year as
duplicative expenses related to its transition service agreement
ends."

S&P believes that integration risks related to the acquisition are
materially diminished after nearly a year as a combined operation.
The Company remains highly leveraged, which reflects, in part,
high integrations costs and duplicative operating expenses related
to its transition service agreement with an affiliate of Nortel.


CLST HOLDINGS: Gets Confidential Treatment of FCC Agreements
------------------------------------------------------------
CLST Holdings, Inc. submitted an application under Rule 24b-2
requesting confidential treatment for information it excluded from
the Exhibits to a Form 8-K filed on November 3, 2010.

Based on representations by CLST Holdings, Inc. 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, the Securities and Exchange
Commission entered an order granting confidential treatment.  The
SEC ruled that excluded information from the following exhibits
will not be released to the public until November 3, 2020:

   (a) Exhibit 10.3 - Sale and Assignment entered into between
       CLST Asset Trust II and FCC Investment Trust I; and

   (b) Exhibit 10.4 - Sale and Assignment entered into between FCC
       Investment Trust I and 50-by-50 LLC.

In the Nov. 3 Form 8-K, the Company recounted that in 2008, it
consummated two acquisitions of consumer notes receivable
portfolios.  On November 10, 2008, the Company, through CLST Asset
I, LLC, a wholly owned subsidiary of CLST Financo, Inc., which is
one of the Company's direct, wholly owned subsidiaries, entered
into a purchase agreement to acquire all of the outstanding equity
interests of FCC Investment Trust I from a third party.  The
purchase price payable in the Trust I Purchase Agreement was
financed pursuant to the terms and conditions set forth in the
credit agreement, dated November 10, 2008, among Trust I, Fortress
Credit Co LLC, as a lender, FCC Finance, LLC, as the initial
servicer, and various other parties.  On December 12, 2008 we,
through CLST Asset Trust II, a newly formed trust wholly owned by
CLST Asset II, LLC, a wholly owned subsidiary of Financo, entered
into a purchase agreement to acquire certain receivables,
installment sales contracts and related assets owned by SSPE
Investment Trust I and SSPE, LLC.  Funding for Trust II included a
revolving loan, which Trust II entered into with Summit Consumer
Receivables Fund, L.P., as originator, SSPE and SSPE Trust, as co-
borrowers, Summit and Eric J. Gangloff, as Guarantors, Fortress
Credit Corp., as a lender, Summit Alternative Investments, LLC, as
the initial servicer, and various other parties.

Both Trust I and Trust II had been notified that they were in
default of certain of their obligations under their respective
credit agreements, and the Company's investment in Trust I and
Trust II was at a substantial risk of loss.  The Company's
outstanding balances under the Trust I Credit Agreement and the
Trust II Credit Agreement were $21.9 million and $4.0 million,
respectively, as of August 31, 2010.  The Company had been in
discussions with Fortress and Fortress Corp. regarding these
matters and has entered into the Trust I and Trust II settlement
transactions discussed below in resolution of these matters.

          Trust I and Trust II Settlement Transactions

On October 29, 2010, the Trust I Credit Agreement was amended,
effective August 31, 2010.  Among other things, the First
Amendment provided additional funding to Trust I to enable it to
purchase the receivables portfolio of Trust II and pay in full the
outstanding principal balance in addition to all accrued interest.
Trust I executed an Amended and Restated Note in favor of
Fortress, dated October 29, 2010, in the face amount of
$25,763,950 which modifies, restates and replaces that certain
Note, dated as of November 10, 2008, executed by Trust I in the
original face amount of $34,891,977.  Pursuant to the First
Amendment, the Administrative Agent and Lenders (i) consented to
the Sale and Assignment Agreement and (ii) waived all prior events
of default under the Trust I Credit Agreement and the accrual and
collection of default rate interest in connection with such events
of default for the period from September 1, 2010 through October
29, 2010.   In addition, the parties agreed that certain
ineligible receivables acquired by Trust I under the Trust I
Purchase Agreement would be repurchased by Drawbridge Special
Opportunities Fund LP, or one of its affiliates, for an amount
equal to $176,964.  These ineligible receivables were sold
pursuant to the Ineligible Receivables Sale and Assignment
Agreement.  Also, the CLST Parties and the Fortress Parties agreed
to a mutual release which released and discharged all claims,
demands and causes of action they may have against one another
related to the Trust I Credit Agreement, the Trust II Credit
Agreement and certain other related transaction documents.  The
First Amendment also amended certain terms and conditions of the
Trust I Credit Agreement including, among others (i) the
definitions of "Change of Control," "Defaulted Receivable,"
"Facility Amount" and "Interest Rate" and (ii) the Annualized
Default Rate triggers and Delinquent Accounts Ratio triggers.

In connection with the Trust I and Trust II Settlement
Transactions, Trust I entered into a Sale and Assignment,
effective as of August 31, 2010, with Trust II, whereby Trust I
purchased from Trust II its portfolio of receivables along with
all related security and rights to income and proceeds from the
receivables for a purchase price of approximately $5.9 million.
Also, Trust I entered into a Sale and Assignment, effective as of
October 29, 2010, with 50-by-50 LLC, an affiliate of Drawbridge,
whereby Trust I sold certain ineligible receivables acquired under
the Trust I Purchase Agreement to Buyer for an amount equal to
$176,964.

                        About CLST Holdings

CLST Holdings, Inc. (OTC: CLHI) does not have significant
operations.  Previously, it operated as a distributor of wireless
products and provider of distribution and value-added logistics
services to the wireless communications industry, serving network
operators, agents, resellers, dealers, and retailers with
operations in the North American and Latin American Regions.  The
company was formerly known as CellStar Corporation and changed its
name to CLST Holdings, Inc. in March 2007.  CLST Holdings, Inc.
was founded in 1981 and is based in Dallas, Texas.

On March 26, 2010 the Company filed a certificate of dissolution
with the Delaware Secretary of State which became effective on
June 24, 2010.  As a result of the effectiveness of the
certificate of dissolution, the Company was dissolved and, except
to the limited extent provided for by Delaware law, its corporate
existence ceased.  The corporation has three years to liquidate
its assets, prosecute and defend suits, satisfy or provide for its
liabilities, including contingent liabilities, to the extent of
the corporation's assets, and distribute the net proceeds or the
assets in kind, if any, to its stockholders.  During this time
period, the corporation must cease to carry on the business for
which it was established, except as may be necessary or incidental
to the winding up of the corporation's affairs.

The Company expects that it could take a couple of years for the
Company to complete its plan of dissolution and make final
liquidating distributions to its stockholders.


CNL HOTELS: Feb. 1 Debt Payment Looms; Lender Groups Negotiate
--------------------------------------------------------------
The Wall Street Journal's Kris Hudson and Eliot Brown report that
investors led by Paulson & Co. and Winthrop Realty Trust reached
an agreement earlier this month with Morgan Stanley Real Estate
Fund V to take control of CNL Hotels & Resorts Inc., exchanging
their $600 million of CNL's corporate mezzanine debt for the
company's equity, according to court documents and people familiar
with the matter.  According to the Journal, the Paulson-Winthrop
group, which also includes Capital Trust, is slated to formally
seize control of the assets in a foreclosure auction set for
Friday.

The Morgan Stanley fund financed its 2007 purchase of the CNL
resorts portfolio by saddling the properties with $3.3 billion of
debt.  According to the Journal, dozens of lenders and investors
hold various slices of CNL's mortgages and mezzanine debt.  Five
of CNL's eight resorts are pledged as collateral for $1.5 billion
of debt due February 1.  The other three are collateral for
$1 billion of debt due in 2012.

The Journal relates that debt-research companies including
Realpoint LLC calculate that CNL's resorts collectively are worth
less than their total debt, meaning junior claims such as those
held by the Paulson-Winthrop group are at risk of being wiped out
in a restructuring or bankruptcy.  The Morgan Stanley fund wrote
off its stake in 2009.

According to the Journal, people familiar with the matter say
that, for the Paulson-Winthrop group to postpone the impending due
date and avoid losing its claim, it likely will need to pay down
several hundred-million dollars of CNL's more senior debt.  If no
agreement is reached, lenders with more senior claims can
foreclose after February 1.  But any lender doing so would then
need to try to extend any debt senior to their own claims by
paying it down.

The Journal relates that people familiar with the debt explained
that, to extend the February 1 deadline, the Paulson-Winthrop
group must reach agreements with holders of $525 million of
mezzanine debt on the five resorts, including debt held by MetLife
Inc.; Government of Singapore Investment Corp., or GIC; and Five
Mile Capital.  The group also must do so with holders of the
portfolio's $1 billion securitized mortgage, which is overseen by
special servicer Midland Loan Services.  KSL Capital Partners LLC,
which owned the resorts until 2004, is a major holder of the
mortgage.

Sources also told the Journal that the Paulson-Winthrop group is
discussing extensions with each group.  The sources said a
combination of KSL and GIC are the most likely challengers to the
Paulson-Winthrop group for control of CNL, since KSL and GIC
previously have worked together with GIC as an investor in KSL's
funds.

The Journal also relates that a more-junior investor, Eastern
Property Fund, filed a lawsuit last week in Delaware state court
to block the Paulson-Winthrop group from foreclosing, given that
such an action would wipe out Eastern's investment.  A hearing on
that case is scheduled for Thursday.


CONSOLIDATED HORTICULTURE: Court Fixes March 31 as Claims Bar Date
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware established
March 31, 2011, at 4:00 p.m. prevailing Eastern time as the last
day for any individual or entity to file proofs of claim against
Consolidated Horticulture Group LLC, et al.

The Court set April 15, 2011, at 4:00 p.m. prevailing Eastern time
as the governmental unit bar date.

The Court also set March 31, 2011, at 4:00 p.m. prevailing Eastern
time as the last day for all parties asserting administrative
expenses against the Debtors' estates (i) arising between the
Petition Date and March 18, 2011 (but excluding claims for fees
and expenses of professionals retained in these proceedings and
members of the Committee in this case) and (ii) whenever arising
under Section 503(b)(9) of the U.S. Bankruptcy Code, to file a
request for payment of the administrative expense.

Proofs of claim may be filed:

  if by first-class mail:

     CHG Claims Processing Center
     c/o Epiq Bankruptcy Solutions, LLC
     FDR Station, P.O. Box 5112
     New York, NY 10150-5112

  if by hand-delivery or overnight mail:

     Epiq Bankruptcy Solutions, LLC
     Attn: CHG Claims Processing Center
     757 Third Avenue, 3rd Floor
     New York, NY 10017

                  About Consolidated Horticulture

Irvine, California-based Consolidated Horticulture Group LLC,
doing business as Hines Nurseries LLC --
http://www.hineshorticulture.com/-- operates nursery facilities
located in Arizona, California, Oregon and Texas.  Through its
affiliate, the company produces and distributes horticultural
products.

Black Diamond Capital Management LLC purchased Hines
Nurseries Inc. in a bankruptcy sale in January 2009.  The
resulting reorganization plan, confirmed in January 2009, paid
secured creditors in full on their $35.9 million in claims while
providing as much as $12 million toward debt owing to suppliers
both before and after the bankruptcy filing.  The business bought
by Black Diamond was renamed to Consolidated Horticulture.

Consolidated Horticulture and its affiliates filed for Chapter 11
protection on October 12, 2010 (Bankr. D. Del. Lead Case No.
10-13308).  Laura Davis Jones, Esq. and Timothy P. Cairns, Esq. at
Pachulski Stang Ziehl & Jones LLP, serve as Delaware counsel to
the Debtors.  Attorneys at Jones, Walker, Waechter, Poitevent,
Carrere & Denegre, L.L.P., serve as bankruptcy counsel.  Epiq
Bankruptcy Solutions LLC is the claims agent. The Official
Committee of Unsecured Creditors has tapped Lowenstein Sandler PC
as counsel and Blank Rome LLP as co-counsel.  Consolidated
Horticulture estimated $100 million to $500 million in assets and
$50 million to $100 million in debts in the Chapter 11 petition.


CORNERSTONE BANCSHARES: R. Vercoe Appointed Community Bank CCO
--------------------------------------------------------------
On January 21, 2011, Cornerstone Bancshares, Inc., announced that
Cornerstone Community Bank of Chattanooga appointed J. Robert
(Bob) Vercoe, Jr., a Senior Vice President and Relationship
Manager, as Executive Vice President and Chief Credit Officer
effective January 7, 2011.  Vercoe has more than 30 years'
experience in the banking industry, having served in executive
positions with banks in Charlotte, N.C.; Nashville, TN; and, most
recently, Chattanooga.  Originally from Raleigh, North Carolina,
he holds a bachelor's degree in U.S. History and an MBA in finance
from the University of North Carolina at Chapel Hill.  Vercoe has
lived in Chattanooga the past 20 years.  He and his wife have four
grown children and reside on Signal Mountain.

"We are extremely pleased to welcome Bob aboard," said Cornerstone
Community Bank President & CEO Frank Hughes.  "With his vast
knowledge and expertise, he will undoubtedly be a tremendous asset
to Cornerstone."

Cornerstone is a single-bank holding company, with $480 million in
assets, serving the Chattanooga, Tennessee MSA, with five branches
throughout Chattanooga and one loan production office in Dalton,
Georgia.  Locally owned and locally operated, Cornerstone
specializes in providing a comprehensive range of customized
financial solutions for businesses and individuals.

Effective January 4, 2011, Jerry D. Lee resigned from his
positions as Executive Vice President and Chief Credit Officer of
the Company.  Mr. Lee's resignation is not the result of a
disagreement with the Company.

                   About Cornerstone Bancshares

Chattanooga, Tenn.-based Cornerstone Bancshares, Inc. is a bank
holding company.  Its wholly-owned subsidiary, Cornerstone
Community Bank, is a Tennessee-chartered commercial bank with five
full-service banking offices located in Hamilton County,
Tennessee.

The Company's balance sheet as of June 30, 2010, showed
$523.4 million in total assets, $494.0 million in total
liabilities, and stockholders' equity of $29.4 million.

As reported in the Troubled Company Reporter on April 6, 2010,
Hazlett, Lewis & Bieter, PLLC, in Chattanooga, Tenn., 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 was not in compliance with certain of its
debt covenants at December 31, 2009.  In addition, as of
December 31, 2009, Cornerstone Community Bank was restricted from
paying dividends to the Company due to the Bank's recent operating
losses and the Bank's reduced capital levels.

                          Consent Order

The Company disclosed in 10-Q for the quarter ended June 30, 2010,
that following the issuance of a written report by the Federal
Deposit Insurance Corporation and the Tennessee Department of
Financial Institutions concerning their joint examination of
Cornerstone Community Bank in October 2009, the Bank entered a
consent order with the FDIC on April 2, 2010, and a written
agreement with the TDFI on April 8, 2010, each concerning areas of
the Bank's operations identified in the report as warranting
improvement and presenting substantially similar plans for making
those improvements.

The consent order and written agreement, which the Company
collectively refers to as the "Action Plans", convey specific
actions needed to address certain findings from the joint
examination and to address the Company's current financial
condition.  The Action Plans contain a list of strict requirements
ranging from a capital directive, which requires the Company to
achieve and maintain minimum regulatory capital levels in excess
of the statutory minimums to be well-capitalized, to developing a
liquidity risk management and contingency funding plan, in
connection with which the Company will be subject to limitations
on the maximum interest rates it  can pay on deposit accounts.
The Action Plans also contain restrictions on future extensions of
credit and requires the development of various programs and
procedures to improve the Company's asset quality as well as
routine reporting on its  progress toward compliance with the
Action Plans to the Board of Directors, the FDIC and the TDFI.

As of April 2, 2010, the date of the Action Plans, the Bank was
deemed to be "adequately capitalized."


COSINE COMMUNICATIONS: Effects Reverse/Forward Stock Split
----------------------------------------------------------
CoSine Communications, Inc. announced that it has filed amendments
to its Certificate of Incorporation to effect a 1-for-500 reverse
stock split of its common stock immediately followed by a 500-for-
1 forward stock split, as previously approved by CoSine's
stockholders on January 10, 2011.  According to an announcement by
the Financial Industry Regulatory Authority, the reverse and
forward stock splits will take effect on January 21, 2011.  On the
Effective Date, the amendments will result in CoSine's
stockholders of record owning less than 500 shares of common stock
receiving a cash payment of $2.24 per share, on a pre-split basis,
in lieu of owning fractional shares and participating in the
forward stock split.  The reverse stock split will be followed
immediately by the 500-for-1 forward stock split.  CoSine
stockholders holding shares in "street name" through a nominee,
such as a bank or a broker, regardless of the number shares held,
and CoSine's stockholders of record owning 500 or more shares of
common stock will not be impacted by the reverse/forward stock
splits and will retain their current numbers of shares of common
stock without change.

CoSine anticipates that upon completion of the reverse and forward
stock splits, CoSine will have fewer than 300 stockholders of
record, enabling CoSine to deregister its common stock under the
Securities Exchange Act of 1934, as amended, and as a result
thereof, to terminate its periodic reporting obligations with the
Securities and Exchange Commission.  CoSine intends to continue to
provide interim unaudited financial information and annual audited
financial information to its stockholders.  CoSine is taking these
steps to avoid the substantial and increasing cost and expense of
being an SEC reporting company and of regulatory compliance under
the Sarbanes-Oxley Act of 2002, and to focus CoSine's resources on
the redeployment of its existing assets to acquire, or invest in,
one or more operating businesses with existing or prospective
taxable income, or from which it can realize capital gains, that
can be offset by use of its net operating loss carry-forwards.

On the Effective Date, CoSine's transfer agent, BNY Mellon
Shareholder Services, will provide instructions to stockholders
relating to payments to cashed out stockholders and to the
issuance of new certificates to continuing stockholders.

                    About Cosine Communications

Los Gatos, California-based CoSine Communications, Inc. (Pink
Sheets:COSN.pk) was founded in 1998 as a global telecommunications
equipment supplier.  As of December 31, 2006, CoSine had ceased
all its product and customer service related operations.  CoSine's
strategic plan is to redeploy its existing resources to identify
and acquire, or invest in, one or more operating businesses with
the potential for generating taxable income or capital gains.

The Company's balance sheet at Sept. 30, 2010, showed
$21.84 million in total assets, $189.0 thousand in liabilities,
all current, and stockholders' equity of $21.65 million.

Burr Pilger Mayer Inc. of San Jose, California, which audited the
Company's annual report for 2009, said that that the CoSine
Communications' actions in September 2004 in connection with its
ongoing evaluation of strategic alternatives to terminate most
of its employees and discontinue production activities in an
effort to conserve cash, raise substantial doubt about its ability
to continue as a going concern.


CPI INT'L: S&P Assigns 'B+' to Proposed Sr. Credit Facility
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B+' issue rating
and a recovery rating of '2' to CPI International Inc.'s proposed
new senior credit facility, consisting of a five-year $30 million
revolving credit facility and a six-year $150 million first-lien
term loan.  S&P also assigned a 'CCC+' issue rating and a recovery
rating of '6' to the Company's proposed new $215 million of senior
notes due 2018.  S&P are leaving the existing ratings on
CreditWatch with negative implications.

Once Veritas Capital completes its acquisition of CPI, S&P expects
to lower the CPI corporate credit rating to 'B' from 'B+' and
withdraw the ratings on the existing debt as well as the corporate
credit rating on Communications and Power Industries, the issuer.
S&P also plan to remove the CPI corporate credit rating from
CreditWatch and assign a stable outlook at that time.

"The expected 'B' corporate credit rating reflects the Company's
higher leverage following the pending acquisition, its modest
scope of operations, and its exposure to some cyclicality and
variability in demand in some of its end markets," said Standard &
Poor's credit analyst Lisa Jenkins.

CPI produces vacuum electron devices as well as power and control
products for commercial and defense applications requiring high-
power and/or high-frequency power generation such as radar,
electronic warfare, satellite communications, and certain medical,
industrial, and scientific applications.


CROWN AMERICAS: S&P Rates $700MM Unsec. Note Offering at 'BB-'
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned a senior unsecured
debt rating of 'BB-' (one notch below the 'BB' corporate credit
rating) and a recovery rating of '5' to the offering of
$700 million in senior unsecured notes due in 2021 to be issued
jointly by Crown Americas LLC and Crown Americas Capital Corp.
III, subsidiaries of Crown Holdings Inc. The recovery rating
indicates S&P's expectation of modest (10% to 30%) recovery in the
event of a payment default.

At the same time, S&P affirmed its 'BB' corporate credit rating on
Crown Holdings Inc. ("Crown").  S&P also affirmed its 'BB-' senior
unsecured debt rating and '5' recovery rating on existing debt
that is guaranteed by Crown Holdings Inc. and certain of its
subsidiaries and affirmed S&P's 'B+' senior unsecured debt rating
and '6' recovery rating on debt that is not guaranteed.

Based on S&P's updated recovery analysis, S&P lowered its senior
secured debt rating to 'BB+' with a recovery rating of '2' from
'BBB-' with a recovery rating of '1'.

"The ratings on Crown reflect its satisfactory business risk
profile as a leading global can manufacturer with annual sales of
about $8 billion and a significant financial risk profile," said
Standard & Poor's credit analyst Cynthia Werneth.  "The Company's
business strengths include leading shares in a number of segments;
global operations, including good positions in emerging markets
with favorable long-term growth prospects; and greater customer
diversity than most peers."  In addition, metal packaging
producers benefit from fairly stable demand because most of the
business is related to the food and beverage industry.  They also
benefit from a relatively consolidated industry structure, and
timely contractual pass-through of raw material cost fluctuations
to customers.  These factors combine to create comparatively
stable earnings and cash flow over economic cycles.

Philadelphia-based Crown Holdings Inc. is a leading global
producer of metal cans for food, aerosols, and beverages.


DAMON PURSELL: Plan Outline Filed; All Claims to Be Paid Over Time
------------------------------------------------------------------
Damon Pursell Construction Company has filed with the U.S.
Bankruptcy Court for the Western District of Missouri a disclosure
statement explaining its Chapter 11 Plan of Reorganization dated
December 18, 2010.

On the Effective Date of the Plan, the Reorganized Debtor will
assume and continue to own and operate its business and assets
presently being operated by the Debtor.  Michael Pursell will
remain as President and will continue to manage the day-to-day
operations of the Debtor.  The Debtor anticipates that the
operation of its will generate sufficient cash to pay all Allowed
Claims that are to be paid by or on the Effective Date of the
Plan, and all remaining Allowed Claims will be paid in full over
an extended period of time from the Debtor's operating revenue in
accordance with the Plan.

The Debtor says the Plan may be in effect for as long as six years
since the Plan calls for the payments to continue for six years
for unsecured allowed claims.

The Debtor relates that it will make every effort to refinance the
pre-petition loans with other financial institutions after the
Plan is confirmed.  In fact, the Debtor states that several other
local bank and financing organizations have expressed an interest
in refinancing portions of the pre-petition Debt.  Thus, the
Debtor will seek to pay off many of the allowed claims as early as
possible, and the time frame of the Plan could be substantially
reduced for many creditors.

With the exception of administrative convenience claims (Class 1)
and interest holders (Class 27), all classes are impaired under
the Plan.

The Debtor will pay all administrative claims in the amount of
$1,000 or below within 30 days of the confirmation of the Plan.
The aggregate amount of Class 1 Allowed Claims is $24,798.

The interest of the member and owner of the Debtor (Class 27) will
not be modified by the Plan.

A copy of the disclosure statement describing the Chapter 11 Plan
is available for free at:

           http://bankrupt.com/misc/DamonPursell.DS.pdf

             About Damon Pursell Construction Company

Kansas City, Missouri-based Damon Pursell Construction Company
owns and operates the Rockridge Quarry, which sells crushed rock
and rip rap products for road construction and other construction
projects.  The Quarry is located at 9001 Hickman Mills Drive, in
Kansas City, Missouri.  The Debtor also owns a construction
business that provides grading, excavation, utility and other
miscellaneous construction services.  Michael Pursell owns 100% of
the Company.  The Company filed for Chapter 11 bankruptcy
protection on September 15, 2010 (Bankr. W.D. Mo. Case No. 10-
44965).  Thomas G. Stoll, Esq., at Dunn & Davison, LLC, assists
the Debtor in its restructuring effort.  In its schedules, the
Debtor disclosed $18,458,000 in assets and $11,981,801 in
liabilities as of the Petition Date.


DANA HOLDING: Moody's Puts 'B3' Rating on New Sr. Unsecured Notes
-----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Dana Holding
Corporation's new senior unsecured notes.  In a related action
Dana's Corporate Family and Probability of Default ratings were
affirmed at B1, and a Ba1 rating was assigned to Dana's amended
and extended senior secured asset based revolving credit facility.
This action follows Dana's announcement that it is offering
$700 million of senior unsecured notes to be used, along with
cash on hand, to repay its existing senior secured term loan.
Concurrent with the completion of the note offering, Dana also
will amend and extend its existing asset based revolving credit
facility.  The amended and extended asset based revolving credit
facility will have a reduced commitment amount of $500 million
down from $650 million.  The Speculative Grade Liquidity Rating
was affirmed at SGL-2.  The rating outlook remains stable.

Ratings assigned:

  -- New senior unsecured unguaranteed 8-year notes, B3 (LGD5
     88%);

  -- New senior unsecured unguaranteed 10-year notes, B3 (LGD5
     88%);

  -- Amended and extended $500 million senior secured asset based
     revolving credit facility, Ba1 (LGD1, 8%);

Ratings affirmed:

  -- Probability of Default Rating, B1;

  -- Corporate Family Rating, B1;

  -- Speculative Grade Liquidity Rating at SGL-2;

  -- Existing $650 million senior secured asset based revolving
     credit facility, Ba1 (LGD2, 19%) - this rating will be
     withdrawn upon repayment;

  -- Existing $869 million (originally $1.4 billion) senior
     secured term loan, Ba2 (LGD2, 26%) - this rating will be
     withdrawn upon repayment

The affirmation of Dana's B1 Corporate Family Rating and stable
rating outlook continues to anticipate an improving near-term
earnings outlook as increased revenues from rising auto production
volumes are leveraged by the operating efficiencies from the
company's restructuring initiatives.  In addition, a lower amount
of funded debt should support modestly stronger credit metrics
including debt/EBITDA and EBIT/Interest coverage.  The proposed
transaction, along with other announced cash uses including
$120 million for the increased investment in Dana's Chinese joint
venture, will significantly reduce the company's cash balances.
Yet, the company is expected to maintain a good liquidity profile
supported by internal cash flow generation and availability under
its ABL.  It is noted, that the amended revolving credit facility
and the new unsecured notes will have indebtedness baskets that
permit significant additional secured debt and allow more
flexibility for restricted payments.  The ratings anticipate that
the company will maintain a prudent financial profile and do not
incorporate aggressive utilization of the incremental debt
capacity allowed under the debt agreements.

The B3 rating on the $700 million of senior unsecured notes
reflects its priority of payout under Moody's LGD Methodology.
The notes will be issued by Dana Holding Corporation, a holding
company, and upon issuance will not be guaranteed by the company's
subsidiaries.  As a result, the notes will be subordinated to
other non-debt liabilities, including unfunded pension amounts and
trade payables, considered under the LGD Methodology.  The
proposed note will contain a springing guarantee covenant under
which the notes will be granted an unconditional guarantee from
any restricted subsidiary which guarantees other debt.

Dana is expected to continue to demonstrate a good liquidity
profile over the next twelve months as indicated by the
Speculative Grade Liquidity Rating of SGL-2, supported by the
Company's expectation of positive free cash flow generation over
the near-term and availability under the bank credit facility.
The company's cash balances at September 30, 2010 were
approximately $1,137 million.  Cash balances are expected to
reduce over the near-term to supplement the net proceeds of the
note offering for the repayment of the existing term loan, fund
the increase in investment in Dana's Chinese joint venture, and
other items.  Yet, cash balances combined with the Company's
positive free cash flow expectation are anticipated to more than
support higher required working capital needs and higher
reinvestment in plant and equipment as net new business improves
with industry conditions.  External liquidity will be supported by
an amended and extended $500 million asset based revolving credit
facility.  Availability under the existing $650 million asset
based revolving credit facility at September 30, 2010, was
approximately $238 million, based on borrowing base limitations,
and $146 million of outstanding letters of credit.  Dana also
maintains an undrawn European receivables loan facility of Euro
170 million, maturing in July 2012.  Accounts receivable balances
available as collateral under the program would have supported a
US$ equivalent of $96 million in borrowings.

The last rating action for Dana Holding Corporation was on
January 13, 2011, when the Corporate Family Rating was raised to
B1.

The principal methodologies used in this rating were Global
Automotive Supplier Industry published in January 2009, and Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.

Dana, headquartered in Maumee, Ohio, is a world leader in the
supply of axles, driveshafts, sealing, thermal management
products, as well as genuine service parts.  The customer base
includes virtually every major vehicle in the global automotive,
commercial vehicle, and off-highway markets.  The company employs
approximately 22,500 people in 26 countries.  Revenues in 2009
were $5.2 billion.


DEL MONTE FOODS: Fitch Cuts IDR to 'B' on More Debt from Buyout
---------------------------------------------------------------
Fitch Ratings downgraded these Issuer Default Ratings of Del Monte
Foods Company and its wholly-owned operating subsidiary Del Monte
Corporation:

Del Monte Foods Company (Borrower/Issuer)

  -- Long-term IDR downgraded to 'B' from 'B+'.

Del Monte Corporation (Operating Subsidiary)

  -- Long-term IDR downgraded to 'B' from 'B+'.

Fitch has also assigned new ratings to the company's proposed
$3.25 billion of secured credit facilities and offering of up to
$1.6 billion senior unsecured notes, as follows:

Del Monte Foods Company (Borrower/Issuer)

  -- $750 million asset-based loan (ABL) revolver at 'BB/RR1';
  -- $2.5 billion term loan B at 'BB/RR1';
  -- Up to $1.6 billion senior unsecured notes at 'B-/RR5'.

Finally, Fitch has affirmed the following ratings on Del Monte
Corporation's existing senior secured bank facility and senior
subordinated notes.  These ratings will be withdrawn once the
proposed credit agreement and debt issuance close and the
subordinated note tender offers discussed below are completed.

Del Monte Corporation (Operating Subsidiary)

  -- Senior secured bank facility at 'BB+';
  -- Senior subordinated notes at 'B'.

The Rating Outlook is Positive.

These actions resolve the Negative Rating Watch Fitch placed on
Del Monte's ratings on Nov. 30, 2010, following the company's
announcement that it had signed a definitive agreement to be
acquired by Kohlberg Kravis Roberts & Co., Vestar Capital Partners
and Centerview Partners for approximately $5.3 billion, excluding
fees and expenses.  Fitch downgraded Del Monte's IDR to 'B+' from
'BB+', secured ratings to 'BB+' from 'BBB-' and subordinated debt
rating to 'B' from 'BB' to reflect Fitch's expectation that the
credit quality of this debt would not remain as high once Del
Monte became a more leveraged entity.

Fitch anticipates that the buy-out, which is scheduled to close
during the first calendar quarter of 2011, will be roughly 70%
debt/30% equity financed excluding fees and expenses.  Total debt
is expected to include a seven-year $2.5 billion secured term loan
and up to $1.6 billion of senior unsecured notes. Del Monte's new
capital structure will also include a 5-year $750 million ABL.

The ABL will have a first-priority lien on accounts receivable,
inventory and cash while the secured term loan will have a first-
priority lien on substantially all other assets and a second-
priority lien on ABL Priority Collateral.  All debt is expected
to be guaranteed by substantially all domestic operating
subsidiaries.  Credit facility terms are expected to include a
springing fixed-charge coverage ratio along with standard debt-
incurrence-based covenants.

In connection with the proposed buy-out, Del Monte's new owners
commenced cash tender offers, and corresponding consent
solicitations, for any and all of Del Monte's existing senior
subordinated notes, including its $250 million 6.75% and
$450 million 7.5% tranches due Feb. 15, 2015 and Oct. 15, 2019,
respectively.  Given the total consideration for the tender, which
includes a consent payment, Fitch anticipates 100% bondholder
participation.  The consent payment deadline is Feb. 1, 2011, and
the tender offer expiration date is Feb. 16, 2011.

The downgrade of Del Monte's IDRs is due to the significant
increase in financial leverage and annualized interest expense
following the buy-out.  Total debt will increase to approximately
$4.1 billion from $1.5 billion at Oct. 31, 2010, and gross
interest expense is expected to exceed more than $250 million
annually, up from $116 million during fiscal 2010.  Based on
latest 12-month Operating EBITDA of $611.6 million, as calculated
by Fitch, pro forma total debt-to-operating EBITDA is 6.7 times
(x) while pro forma operating EBITDA-to-gross interest expense
could approximate 2.4x.

The Positive Outlook reflects Fitch's view regarding Del Monte's
future ability to de-lever its balance sheet, given its annual
free cash flow generation, relatively high EBITDA margins, and
leading No. 1 and No. 2 U.S. market share positions in the
processed produce and many of the pet food and pet snack
categories in which it competes.  For the year ended May 2, 2010,
the company's Consumer Products segment represented 53% of sales
and 39% of operating income while its Pet Products segment
represented 47% of sales and 61% of operating income.  Fitch does
not expect Del Monte's operating strategy, which has focused on
accelerating growth with higher margin pet products and packaged
produce, to change as a result of the buy-out.

Furthermore, for the LTM period ended Oct. 31, 2010, Del Monte
generated $214.7 million of FCF and had an operating EBITDA margin
of 16.5%.  Despite significantly higher projected interest expense
and the expectation that inflationary cost pressures will grow in
fiscal 2012, Fitch believes on-going productivity savings and
additional cost savings accruing from the buy-out by KKR, Vestar
and Centerview will mitigate potential margin compression.

According to Fitch's modeling, Del Monte has the capacity to
generate normalized FCF in the $100 million-$150 million range and
to maintain adequate liquidity following its buy-out.  Should FCF
be utilized for debt reduction, as Fitch expects, total debt-to-
operating EBITDA could decline to below 6.0x within 18-24 months
of the transaction.  Leverage below 6.0x along with relatively
stable margins and continued meaningful FCF generation could
result in future rating upgrades.

The 'RR1' Recovery Rating on Del Monte's $3.25 billion of proposed
secured debt indicates that Fitch views recovery prospects on
these obligations as outstanding at 91% or better.  The 'RR5'
rating assigned to the company's senior unsecured notes denotes
below-average recovery in the 11%-30% range if the bonds went into
default.  However, Fitch recognizes that recovery could be higher
given the historical stability of Del Monte's cash flow and the
strength of its position in the higher margin fast growing pet
food/snack category for which it competes.


DELTA AIR: Discloses Sale of $474 Mil. in Certificates
------------------------------------------------------
Delta Air Lines, Inc., disclosed with the Securities and Exchange
Commission that on June 28, 2010, it entered into an underwriting
agreement with Credit Suisse Securities (USA) LLC, Morgan Stanley
& Co. Incorporated and Deutsche Bank Securities, Inc., as
representatives of the underwriters named therein, in connection
with the issuance and sale of a total of $474,072,000 of the
Certificates.

The Certificates are being offered pursuant to the Prospectus
Supplement, dated November 15, 2010, to the Prospectus, dated June
28, 2010, which forms a part of the Company's automatic shelf
registration statement on Form S-3 (Registration No. 333-167811),
filed with the Securities and Exchange Commission on June 28,
2010.

The Underwriting Agreement contains customary representations,
warranties, covenants and closing conditions for a transaction of
this type.  The Underwriting Agreement also contains provisions
pursuant to which the Company agrees to hold harmless and
indemnify the Underwriters against damages under certain
circumstances, which are customary for a transaction of this type.

Delivery of the Certificates was made under the Underwriting
Agreement on November 22, 2010, with an interest rate of 4.95% per
annum.  The Certificates were issued by a pass through trust.  The
Underwriters purchased the Certificates from the pass through
trust at 100% of the principal amount thereof.

The pass through trust will use the proceeds from the sale of
Certificates to acquire the Series A Equipment Notes from the
Company.  Payments on the Series A Equipment Notes will be passed
through to the certificateholders of the trust.  The Company
expects to use the proceeds from the issuance of the Series A
Equipment Notes issued with respect to each 2001-1 Aircraft and
Mortgaged Aircraft to reimburse itself, in part, for the
prepayment or repayment at maturity, as applicable, of the
existing financing of such 2001-1 Aircraft and Mortgaged Aircraft.
The Company will use the balance of any such proceeds not used in
connection with the foregoing, along with the proceeds from the
issuance of the Series A Equipment Notes issued with respect to
the Owned Aircraft, to pay fees and expenses relating to the
offering and for general corporate purposes.

                       About Delta Air Lines

Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) --
http://www.delta.com/or http://www.nwa.com/-- provides scheduled
air transportation for passengers and cargo throughout the United
States, and around the world.  The Company's route network is
centered on the hub system it operate at airports in Atlanta,
Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK,
Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo-
Narita. The hub operations include flights, which gather and
distribute traffic from markets in the geographic region
surrounding the hub to domestic and international cities and to
other hubs. The network is supported by a fleet of aircraft, which
is varied in terms of size and capabilities.  On December 31,
2009, the Company's wholly owned subsidiary Northwest Airlines,
Inc., merged with and into Delta.  The wholly owned subsidiary of
the Company is Northwest Airlines Corporation.

Northwest and 12 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).
On May 21, 2007, the Court confirmed the Northwest Debtors'
amended plan.  That amended plan took effect May 31, 2007.

Delta and 18 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented
the Delta Debtors in their restructuring efforts. On April 25,
2007, the Court confirmed the Delta Debtors' plan.  That plan
became effective on April 30, 2007.

(Bankruptcy Creditors Service Inc. publishes Delta Air Lines
Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000).

                        *     *     *

Delta Air Lines and Northwest Airlines carry a 'B/Stable/--'
corporate ratings from Standard & Poor's.  They also continue to
carry 'B2' corporate family ratings from Moody's and "B-" LT
Issuer Default rating from Fitch.


DELTA AIR: Files Post-Confirmation Report for Third Quarter
-----------------------------------------------------------

                     Delta Air Lines, Inc.
                  Consolidated Balance Sheets
                   As of September 30, 2010
                         (In Millions)

                            ASSETS
Current Assets:
  Cash and cash equivalents                              $3,436
  Short-term investments                                    439
  Restricted cash                                           418
  Accounts receivable, net                                1,512
  Expendable parts & supplies inventories                   278
  Deferred income taxes, net                                167
  Prepaid expenses and other                              1,071
                                                         ------
Total current assets                                      7,321

Property and Equipment, Net:
  Property and equipment, net                            20,184

Other Assets:
  Goodwill                                                9,794
  Identifiable intangibles, net                           4,766
  Other noncurrent assets                                 1,088
                                                         ------
Total other assets                                       15,648
                                                         ------
Total assets                                            $43,153
                                                         ======

             LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Current maturities of long-term debt
     and capital leases                                  $2,302
  Air traffic liability                                   3,767
  Accounts payable                                        1,661
  Frequent flyer deferred revenue                         1,610
  Accrued salaries and related benefits                   1,280
  Taxes payable                                             592
  Other accrued liabilities                                 608
                                                         ------
Total current liabilities                                11,820

Noncurrent Liabilities:
  Long-term debt and capital leases                      13,063
  Pension, postretirement & related benefits             11,383
  Frequent flyer deferred revenue                         2,916
  Deferred income taxes, net                              1,734
  Other noncurrent liabilities                            1,522
                                                         ------
Total noncurrent liabilities                             30,618

Commitments and Contingencies

Stockholders' Equity:
  Common stock at $0.0001 par value                          --
  Additional paid-in capital                             13,900
  Accumulated deficit                                    (9,271)
  Accumulated other comprehensive loss                   (3,716)
  Treasury stock, at cost                                  (198)
                                                         ------
Total stockholders' equity                                  715
                                                         ------
Total liabilities and stockholders' equity              $43,153
                                                         ======

                     Delta Air Lines, Inc.
             Consolidated Statements of Operations
             Three Months Ended September 30, 2010
                         (In Millions)

Operating Revenue:
  Passenger:
     Mainline                                            $6,204
     Regional carriers                                    1,571
                                                         ------
  Total passenger revenue                                 7,775

  Cargo                                                     227
  Other, net                                                948
                                                         ------
Total operating revenue                                   8,950

Operating Expense:
  Aircraft fuel and related taxes                         2,023
  Salaries and related costs                              1,669
  Contract carrier arrangements                           1,236
  Aircraft maintenance materials/outside repairs            405
  Contracted services                                       398
  Passenger commissions/other selling expenses              404
  Depreciation and amortization                             375
  Landing fees and other rents                              331
  Passenger service                                         190
  Aircraft rent                                              92
  Profit sharing                                            185
  Restructuring and merger-related items                    206
  Other                                                     433
                                                         ------
Total operating expense                                   7,947
                                                         ------
Operating Income (Loss)                                   1,003

Other (Expense) Income:
  Interest expense                                         (256)
  Amortization of debt discount, net                        (53)
  Interest income                                             7
  Loss on extinguishment of debt                           (360)
  Miscellaneous, net                                         25
                                                         ------
Total other expense, net                                   (637)
                                                         ------
Income (Loss) Before Income Taxes                           366

Income Tax (Provision) Benefit                               (3)
                                                         ------
Net Income (Loss)                                          $363
                                                         ======

                     Delta Air Lines, Inc.
        Condensed Consolidated Statements of Cash Flow
             Nine Months Ended September 30, 2010
                         (In Millions)

Net cash provided by operating activities                $2,514

Cash Flows From Investing Activities:
  Property and equipment additions:
     Flight equipment, incl. advance payments              (753)
     Ground property and equipment                         (168)
  (Purchase) redemption of investments                     (353)
  Proceeds from sales of flight equipment                    28
  Proceeds from sale of subsidiary                           21
  Increase in restricted cash                               (18)
  Other investments                                         (98)
  Other, net                                                (16)
                                                         ------
Net cash used in investing activities                    (1,357)

Cash Flows From Financing Activities:
  Payments on long-term debt and capital
     lease obligations                                   (2,546)
  Proceeds from long-term obligations                       223
  Other, net                                                 (5)
Net cash (used in) provided by                            ------
financing activities                                      (2,328)
Net (Decrease) Increase in Cash and                       ------
Cash Equivalents                                          (1,171)

Cash and cash equivalents at beginning of period           4,607
                                                          ------
Cash and cash equivalents at end of period                 3,436

A copy of Delta's Post-Confirmation Report is available for free
at http://bankrupt.com/misc/Delta_PostCon_3QReport_Sep2010.pdf

                       About Delta Air Lines

Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) --
http://www.delta.com/or http://www.nwa.com/-- provides scheduled
air transportation for passengers and cargo throughout the United
States, and around the world.  The Company's route network is
centered on the hub system it operate at airports in Atlanta,
Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK,
Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo-
Narita. The hub operations include flights, which gather and
distribute traffic from markets in the geographic region
surrounding the hub to domestic and international cities and to
other hubs. The network is supported by a fleet of aircraft, which
is varied in terms of size and capabilities.  On December 31,
2009, the Company's wholly owned subsidiary Northwest Airlines,
Inc., merged with and into Delta.  The wholly owned subsidiary of
the Company is Northwest Airlines Corporation.

Northwest and 12 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).
On May 21, 2007, the Court confirmed the Northwest Debtors'
amended plan.  That amended plan took effect May 31, 2007.

Delta and 18 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented
the Delta Debtors in their restructuring efforts. On April 25,
2007, the Court confirmed the Delta Debtors' plan.  That plan
became effective on April 30, 2007.

(Bankruptcy Creditors Service Inc. publishes Delta Air Lines
Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000).

                        *     *     *

Delta Air Lines and Northwest Airlines carry a 'B/Stable/--'
corporate ratings from Standard & Poor's.  They also continue to
carry 'B2' corporate family ratings from Moody's and "B-" LT
Issuer Default rating from Fitch.


DELTA AIR: Flight Attendants Reject AFA Representation
------------------------------------------------------
Delta Air Lines has received notification from the National
Mediation Board (NMB) in November last year that a majority --
more than 53 percent -- of flight attendants voting in the
election rejected representation by the Association of Flight
Attendants (AFA).

In response, Delta Senior Vice President of In-Flight Service
Joanne Smith issued this message to its 20,000 flight attendants:

    "We are happy to share the results of the Delta flight
    attendant representation election we received today from the
    National Mediation Board.  The majority of voters rejected
    AFA representation.  This is a win for all Delta flight
    attendants.  We are pleased not just with the outcome, but
    also with the fact that so many of you let your voice be
    heard.  There were 18,760 votes cast and 53% voted against
    AFA representation.  There were 19,887 eligible voters, of
    which only 44% voted for AFA.  No matter how you voted,
    thank you for participating.  I could not be more proud of
    our flight attendants.

    So how soon can we fly together, open single bids for base
    transfers and fully integrate?  Just as soon as we are able
    to align pay, benefits, work rules and produce a single
    seniority list.  We hope to be able to move quickly, as we
    have with other workgroups where representation has been
    resolved.  Rates of pay would be the first to be aligned --
    and that would be the first day of the first bid period
    after our flight attendants' decision becomes final.

    We will release the transition plan with anticipated
    timelines for full integration as soon as we can.  The AFA
    has until November 12 to file interference claims with the
    NMB.  If they do not file those claims, you can expect to
    hear our plans for integration very soon thereafter.  If
    interference claims are filed, we will not be in a position
    to align pay, benefits and work rules until final resolution
    is achieved.  As I have heard from so many of you, we are
    anxious to complete our integration and move forward as soon
    as possible.  We have said we respect our flight attendants'
    choice.  We urge the AFA to show that same respect.

    It has been two years since the completion of our merger and
    I want to thank you for your professionalism.  You've been
    waiting a long time for today, and I know we've all grown
    weary of the election debate.  You have spoken and it is
    time to move forward.  Your leadership team will do our best
    to build upon your trust and confidence."

                       About Delta Air Lines

Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) --
http://www.delta.com/or http://www.nwa.com/-- provides scheduled
air transportation for passengers and cargo throughout the United
States, and around the world.  The Company's route network is
centered on the hub system it operate at airports in Atlanta,
Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK,
Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo-
Narita. The hub operations include flights, which gather and
distribute traffic from markets in the geographic region
surrounding the hub to domestic and international cities and to
other hubs. The network is supported by a fleet of aircraft, which
is varied in terms of size and capabilities.  On December 31,
2009, the Company's wholly owned subsidiary Northwest Airlines,
Inc., merged with and into Delta.  The wholly owned subsidiary of
the Company is Northwest Airlines Corporation.

Northwest and 12 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).
On May 21, 2007, the Court confirmed the Northwest Debtors'
amended plan.  That amended plan took effect May 31, 2007.

Delta and 18 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented
the Delta Debtors in their restructuring efforts. On April 25,
2007, the Court confirmed the Delta Debtors' plan.  That plan
became effective on April 30, 2007.

(Bankruptcy Creditors Service Inc. publishes Delta Air Lines
Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000).

                        *     *     *

Delta Air Lines and Northwest Airlines carry a 'B/Stable/--'
corporate ratings from Standard & Poor's.  They also continue to
carry 'B2' corporate family ratings from Moody's and "B-" LT
Issuer Default rating from Fitch.


DELTA AIR: Reports December 2010 Traffic Results
------------------------------------------------
Delta Air Lines reported traffic results for December 2010.
System traffic in December 2010 increased 2.4 percent compared to
December 2009 on a 3.9 percent increase incapacity.  Load factor
decreased 1.1 points to 80.1 percent.

Domestic traffic increased 0.5 percent year over year on a
1.2 percent increase incapacity.  Domestic load factor decreased
0.6 points to 79.6 percent.  International traffic increased 5.3
percent year over year on an 8.1 percent increase incapacity, and
load factor decreased 2.1 points to 80.7 percent.

"December's severe winter weather throughout the United States and
Western Europe reduced Delta's net profit for the fourth quarter
by about $45 million from our previous expectations," said Ed
Bastian, Delta's president.  "My thanks go out to the Delta team
for their hard work to quickly restore normal operations and their
dedication to our customers during the difficult weather
environment."

                      Delta Air Lines
                 Monthly Traffic Results

                            Dec-10        Dec-09   Change
RPMs (000):
Domestic                  8,943,543     8,898,552      0.5%
Mainline                 7,030,105     6,930,192      1.4%
Regional                 1,913,438     1,968,360     (2.8%)
International             6,092,932     5,785,913      5.3%
Latin America            1,062,456     1,205,296    (11.9%)
   Mainline               1,049,250     1,183,889    (11.4%)
   Regional                  13,206        21,407    (38.3%)
Atlantic                 3,095,523     2,873,364      7.7%
Pacific                  1,934,953     1,707,253     13.3%
System                   15,036,475    14,684,465      2.4%

ASMs (000):
Domestic                 11,230,161    11,095,195      1.2%
Mainline                 8,717,084     8,529,601      2.2%
Regional                 2,513,077     2,565,594     (2.0%)
International             7,549,919     6,984,072      8.1%
Latin America            1,343,181     1,540,978    (12.8%)
   Mainline               1,322,544     1,511,356    (12.5%)
   Regional                  20,637        29,622    (30.3%)
Atlantic                 3,843,958     3,448,999     11.5%
Pacific                  2,362,780     1,994,095     18.5%
System                   18,780,080    18,079,267      3.9%

Load Factor:
Domestic                      79.6%         80.2%     (0.6) pts
Mainline                     80.6%         81.2%     (0.6) pts
Regional                     76.1%         76.7%     (0.6) pts
International                 80.7%         82.8%     (2.1) pts
Latin America                79.1%         78.2%      0.9 pts
   Mainline                   79.3%         78.3%      1.0 pts
   Regional                   64.0%         72.3%     (8.3) pts
Atlantic                     80.5%         83.3%     (2.8) pts
Pacific                      81.9%         85.6%     (3.7) pts
System                        80.1%         81.2%     (1.1) pts

Passengers Boarded       12,705,281    12,496,900      1.7%

Mainline Completion           95.5%         98.0%      2.5 pts
Factor

Cargo Ton Miles (000):
Passenger Cargo             202,020       169,905     18.9%
Freighter Cargo                   0        51,102   (100.0%)
System                      202,020       221,007     (8.6%)

                      Delta Air Lines
                Year To Date Traffic Results

                            Dec-10        Dec-09   Change
RPMs (000):
Domestic                115,811,403   114,979,088      0.7%
Mainline                91,106,082    89,965,474      1.3%
Regional                24,705,321    25,013,614     (1.2%)
International            77,357,958    73,964,194      4.6%
Latin America           13,153,017    12,604,482      4.4%
   Mainline              12,869,243    12,380,350      3.9%
   Regional                 283,774       224,132     26.6%
Atlantic                41,893,719    41,804,840      0.2%
Pacific                 22,311,223    19,554,872     14.1%
System                  193,169,361   188,943,282      2.2%

ASMs (000):
Domestic                139,737,482   138,793,389      0.7%
Mainline               108,260,400   106,501,202      1.7%
Regional                31,477,082    32,292,187     (2.5%)
International            92,946,758    91,537,178      1.5%
Latin America           16,552,393    16,067,131      3.0%
   Mainline              16,159,276    15,751,697      2.6%
   Regional                 393,117       315,434     24.6%
Atlantic                50,216,837    51,536,843     (2.6%)
Pacific                 26,177,528    23,933,204      9.4%
System                  232,684,240   230,330,567      1.0%

Load Factor:
Domestic                      82.9%         82.8%      0.1 pts
Mainline                     84.2%         84.5%     (0.3) pts
Regional                     78.5%         77.5%      1.0 pts
International                 83.2%         80.8%      2.4 pts
Latin America                79.5%         78.4%      1.1 pts
   Mainline                  79.6%         78.6%      1.0 pts
   Regional                  72.2%         71.1%      1.1 pts
Atlantic                     83.4%         81.1%      2.3 pts
Pacific                      85.2%         81.7%      3.5 pts
System                        83.0%         82.0%      1.0 pts

Passengers Boarded      162,614,714   161,070,926      1.0%

Cargo Ton Miles (000):
Passenger Cargo           2,272,212     1,741,102     30.5%
Freighter Cargo                   0       547,333   (100.0%)
System                    2,272,212     2,288,435     (0.7%)

                       About Delta Air Lines

Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) --
http://www.delta.com/or http://www.nwa.com/-- provides scheduled
air transportation for passengers and cargo throughout the United
States, and around the world.  The Company's route network is
centered on the hub system it operate at airports in Atlanta,
Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK,
Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo-
Narita. The hub operations include flights, which gather and
distribute traffic from markets in the geographic region
surrounding the hub to domestic and international cities and to
other hubs. The network is supported by a fleet of aircraft, which
is varied in terms of size and capabilities.  On December 31,
2009, the Company's wholly owned subsidiary Northwest Airlines,
Inc., merged with and into Delta.  The wholly owned subsidiary of
the Company is Northwest Airlines Corporation.

Northwest and 12 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).
On May 21, 2007, the Court confirmed the Northwest Debtors'
amended plan.  That amended plan took effect May 31, 2007.

Delta and 18 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented
the Delta Debtors in their restructuring efforts. On April 25,
2007, the Court confirmed the Delta Debtors' plan.  That plan
became effective on April 30, 2007.

(Bankruptcy Creditors Service Inc. publishes Delta Air Lines
Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000).

                        *     *     *

Delta Air Lines and Northwest Airlines carry a 'B/Stable/--'
corporate ratings from Standard & Poor's.  They also continue to
carry 'B2' corporate family ratings from Moody's and "B-" LT
Issuer Default rating from Fitch.


DELTA AIR: Signs Note Purchase Agreement With U.S. Bank
-------------------------------------------------------
Delta Air Lines, Inc., disclosed with the Securities and Exchange
Commission that on November 22, 2010, it entered into a Note
Purchase Agreement with U.S. Bank Trust National Association, as
Subordination Agent and Pass Through Trustee under the pass
through trust newly formed by the Company, U.S. Bank National
Association, as Escrow Agent under the Escrow Agreement, and U.S.
Bank Trust National Association as Paying Agent under the Escrow
Agreement.

The Note Purchase Agreement provides for future issuance by the
Company of Series A equipment notes in the aggregate principal
amount of $474,072,000 secured by 28 aircraft:

   (1) (a) six Boeing 737-832 aircraft delivered new to Delta in
       2000, (b) one Boeing 757-232 aircraft delivered new to
       Delta in 2001 and (c) three Boeing 767-332ER aircraft
       delivered new to Delta in 2000, in each case currently
       subject to liens under a prior enhanced equipment trust
       certificate transaction entered into by Delta in
       September 2001;

  (2) (a) two Boeing 737-732 aircraft delivered new to Delta in
      2009, (b) six Boeing 757-251 aircraft delivered new in
      1996 to Northwest Airlines, Inc., which was acquired by
      Delta in October 2008 and subsequently merged into Delta
      on December 31, 2009 with Delta as the surviving entity,
      (c) one Boeing 777-232LR delivered new to Delta in 2009
      and (d) one Airbus A330-223 aircraft delivered new to
      Northwest Airlines in 2004 -- the "Mortgaged Aircraft", in
      each case currently subject to liens under separate
      mortgage financings; and

  (3) (a) three Boeing 757-351 aircraft delivered new to
      Northwest Airlines in 2003, (b) one Airbus A320-211
      aircraft delivered new to Northwest Airlines in 2003,
      (c) one Airbus A330-323 aircraft delivered new to Northwest
      Airlines in 2005 and (d) three McDonnell Douglas MD-90-30
      aircraft delivered new to third parties from McDonnell
      Douglas from 1996 to 1997 and acquired by Delta in 2009
      and 2010 -- the "Owned Aircraft".

Pursuant to the Note Purchase Agreement, the Trustee will purchase
the Series A Equipment Notes by (a) October 31, 2011, with respect
to the 2001-1 Aircraft; (b) April 30, 2011 with respect to the
Mortgaged Aircraft; and (c) within 90 days of the date of the
execution of the Note Purchase Agreement with respect to the Owned
Aircraft.  The Series A Equipment Notes will be issued under an
Indenture and Security Agreement with respect to each Aircraft to
be entered into by the Company and U.S. Bank Trust National
Association, as Loan Trustee.  The Note Purchase Agreement also
provides for the possible future issuance of another series of
equipment notes to be secured by the Aircraft.

Each Indenture contemplates the issuance of Series A Equipment
Notes, bearing interest at the rate of 4.95% per annum in the
aggregate principal amount equal to $474,072,000.  The Series A
Equipment Notes will be purchased by the Trustee, using the
proceeds from the sale a total of $474,072,000 of Delta Air Lines,
Inc. Pass Through Certificates, Series 2010-2A.

Pending the purchase of the Series A Equipment Notes, the proceeds
from the sale of the Certificates were placed in escrow by the
Trustee pursuant to an Escrow and Paying Agent Agreement, dated as
of November 22, 2010, among U.S. Bank National Association, as
Escrow Agent and Paying Agent, Credit Suisse Securities (USA) LLC,
Morgan Stanley & Co. Incorporated, Deutsche Bank Securities, Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit
Agricole Securities (USA) Inc., UBS Securities LLC, and the
Trustee. The escrowed funds were deposited with the Bank of New
York Mellon, under a Deposit Agreement.

The interest on the escrowed funds is payable on May 23, 2011, and
interest on the Series A Equipment Notes is payable semiannually
on each May 23 and November 23 following the issuance thereof,
beginning on May 23, 2011.  The principal payments on the Series A
Equipment Notes are scheduled on May 23 and November 23 of certain
years, beginning on May 23, 2011.  The final payments on the
Series A Equipment Notes will be due on November 23, 2016,
November 23, 2018 and May 23, 2019, depending on the aircraft
type.  Maturity of the Series A Equipment Notes may be accelerated
upon the occurrence of certain events of default, including
failure by the Company to make payments under the applicable
Indenture when due or to comply with certain covenants, as well as
certain bankruptcy events involving the Company.  The Series A
Equipment Notes issued with respect to each Aircraft will be
secured by a lien on such Aircraft and will also be cross-
collateralized by the other Aircraft financed pursuant to the Note
Purchase Agreement.

                       About Delta Air Lines

Atlanta, Georgia-based Delta Air Lines (NYSE: DAL) --
http://www.delta.com/or http://www.nwa.com/-- provides scheduled
air transportation for passengers and cargo throughout the United
States, and around the world.  The Company's route network is
centered on the hub system it operate at airports in Atlanta,
Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK,
Salt Lake City, Paris-Charles de Gaulle, Amsterdam and Tokyo-
Narita. The hub operations include flights, which gather and
distribute traffic from markets in the geographic region
surrounding the hub to domestic and international cities and to
other hubs. The network is supported by a fleet of aircraft, which
is varied in terms of size and capabilities.  On December 31,
2009, the Company's wholly owned subsidiary Northwest Airlines,
Inc., merged with and into Delta.  The wholly owned subsidiary of
the Company is Northwest Airlines Corporation.

Northwest and 12 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).
On May 21, 2007, the Court confirmed the Northwest Debtors'
amended plan.  That amended plan took effect May 31, 2007.

Delta and 18 affiliates filed for Chapter 11 protection on
September 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represented
the Delta Debtors in their restructuring efforts. On April 25,
2007, the Court confirmed the Delta Debtors' plan.  That plan
became effective on April 30, 2007.

(Bankruptcy Creditors Service Inc. publishes Delta Air Lines
Bankruptcy News, http://bankrupt.com/newsstand/or 215/945-7000).

                        *     *     *

Delta Air Lines and Northwest Airlines carry a 'B/Stable/--'
corporate ratings from Standard & Poor's.  They also continue to
carry 'B2' corporate family ratings from Moody's and "B-" LT
Issuer Default rating from Fitch.


DELTA PETROLEUM: S&P Cuts Senior Unsecured Debt Rating to CCC-
--------------------------------------------------------------
Standard & Poor's Ratings Services took several rating actions on
16 U.S. oil and gas exploration and production companies following
an industry review.  S&P's review on the sector followed S&P's
Sept. 30, 2010, revision of S&P's exploration and production
recovery criteria.  The new approach aims to better reflect S&P's
expectation for commodity prices and reserve values in a default
scenario.

The rating actions S&P took, were on speculative-grade companies
and affected specific issues and their respective recovery
ratings. S&P did not take any corporate credit rating actions.
(Standard & Poor's recovery rating scale ranges from '6',
indicating expectations of negligible [0%-10%] recovery in a
payment default, to '1+', indicating expectations of full [100%]
recovery.)  S&P included in its reviews an updated reserve report
utilizing S&P's new price deck.

Ratings List
Issue Ratings lowered; Recovery Ratings Revised
                                           To     From
Quicksilver Resources Inc. (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          5      3

BreitBurn Energy Partners (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Ratings                         5      4

Helix Energy Solutions Group Inc. (B/Stable/--)
Senior Unsecured                          CCC+   B-
  Recovery Ratings                         6      5

Rosetta Resources Inc. (B/Stable/--)
Senior Unsecured                          B-     B+
  Recovery Rating                          5      2

Chaparral Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          4      2

NFR Energy LLC (B/Stable/--)
Senior Unsecured                          B-     B
  Recovery Rating                          5      4

Venoco Inc. (B/Stable/--)
Second-Lien Secured                       B      BB-
  Recovery Rating                          4      1

Delta Petroleum Corp. (CCC/Negative/--)
Senior Unsecured                          CCC-   CCC
  Recovery Rating                          5      4

Dune Energy Inc. (CCC-/Negative/Unsolicited)
Second-Lien Secured                       CC       CCC-
  Recovery Rating                          5        4


Issue Ratings Raised; Recovery Ratings Revised
                                           To     From
Penn Virginia Corp. (BB-/Stable/--)
Subordinated                              B+     B
  Recovery Rating                          5      6

Forest Oil Corp. (BB-/Stable/--)
Senior Unsecured                          BB-    B+
  Recovery Rating                          4      5

Clayton Williams Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B-
  Recovery Rating                          4      5


Issue Ratings Unchanged; Recovery Ratings Revised
                                           To     From
Whiting Petroleum Corp. (BB/Stable/--)
Recovery Rating                           4      3

Range Resources Corp. (BB/Stable/--)
Recovery Rating                            3      4

Bill Barrett Corp. (BB-/Stable/--)
Recovery Rating                           3      4

PetroQuest Energy Inc. (B/Stable/--)
Recovery Rating                           4      3


DIVERSIFIED INDUSTRIES: Proofs of Claim Due February 7
------------------------------------------------------
Diversified Industries Ltd. disclosed that the company's Proposal
to Creditors under the Bankruptcy and Insolvency Act, R.S.C. 1985,
was approved by the Supreme Court of British Columbia on January
24, 2011.  The Company's creditors have until February 7, 2011 to
submit a proof of claim form to G. Powroznik Group Inc., of G-
Force Group, the Trustee under the Proposal.

A copy of the Proposal and relevant documents is posted on the
Trustee's Web site, at http://www.g-forcegroup.ca/current-
projects/diversified-industries

The Trustee will immediately begin working with the Company to
implement the terms of the Proposal, including retiring all the
Company's liabilities, selling all of its assets, and preserving
the tax pools as the only remaining material asset of the Company.

The Trustee expects the Company to complete the terms of the
Proposal by approximately February 28, 2011.


DUNE ENERGY: S&P Cuts Second-Lien Secured Rating to 'CC'
--------------------------------------------------------
Standard & Poor's Ratings Services took several rating actions on
16 U.S. oil and gas exploration and production companies following
an industry review.  S&P's review on the sector followed S&P's
Sept. 30, 2010, revision of S&P's exploration and production
recovery criteria.  The new approach aims to better reflect S&P's
expectation for commodity prices and reserve values in a default
scenario.

The rating actions S&P took, were on speculative-grade companies
and affected specific issues and their respective recovery
ratings. S&P did not take any corporate credit rating actions.
(Standard & Poor's recovery rating scale ranges from '6',
indicating expectations of negligible [0%-10%] recovery in a
payment default, to '1+', indicating expectations of full [100%]
recovery.)  S&P included in its reviews an updated reserve report
utilizing S&P's new price deck.

Ratings List
Issue Ratings lowered; Recovery Ratings Revised
                                           To     From
Quicksilver Resources Inc. (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          5      3

BreitBurn Energy Partners (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Ratings                         5      4

Helix Energy Solutions Group Inc. (B/Stable/--)
Senior Unsecured                          CCC+   B-
  Recovery Ratings                         6      5

Rosetta Resources Inc. (B/Stable/--)
Senior Unsecured                          B-     B+
  Recovery Rating                          5      2

Chaparral Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          4      2

NFR Energy LLC (B/Stable/--)
Senior Unsecured                          B-     B
  Recovery Rating                          5      4

Venoco Inc. (B/Stable/--)
Second-Lien Secured                       B      BB-
  Recovery Rating                          4      1

Delta Petroleum Corp. (CCC/Negative/--)
Senior Unsecured                          CCC-   CCC
  Recovery Rating                          5      4

Dune Energy Inc. (CCC-/Negative/Unsolicited)
Second-Lien Secured                       CC       CCC-
  Recovery Rating                          5        4


Issue Ratings Raised; Recovery Ratings Revised
                                           To     From
Penn Virginia Corp. (BB-/Stable/--)
Subordinated                              B+     B
  Recovery Rating                          5      6

Forest Oil Corp. (BB-/Stable/--)
Senior Unsecured                          BB-    B+
  Recovery Rating                          4      5

Clayton Williams Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B-
  Recovery Rating                          4      5


Issue Ratings Unchanged; Recovery Ratings Revised
                                           To     From
Whiting Petroleum Corp. (BB/Stable/--)
Recovery Rating                           4      3

Range Resources Corp. (BB/Stable/--)
Recovery Rating                            3      4

Bill Barrett Corp. (BB-/Stable/--)
Recovery Rating                           3      4

PetroQuest Energy Inc. (B/Stable/--)
Recovery Rating                           4      3


DYNEGY INC: Seneca Wants Poison Pill Waived to Buy More Shares
--------------------------------------------------------------
Seneca Capital has asked the Special Committee of the Board of
Directors of Dynegy Inc. -- consisting of Patricia Hammick, David
Biegler, Victor Grijalva, William Trubeck and Howard Sheppard --
for limited waivers of Dynegy's Stockholder Protection Rights
Agreement dated as of November 22, 2010 as amended, to permit
Seneca (i) to work in concert with others for the purpose of
acquiring additional Dynegy common stock at a price greater than
$5.50 per share, and (ii) to acquire additional non-voting
Beneficial Ownership of Dynegy common stock at a price that is
greater than $5.50 per share.

Seneca is the second largest shareholder of Dynegy with a 12%
economic interest, including 9.3% voting common stock.  A full-
text copy of Seneca's letter is available at http://is.gd/GKlvTK

On Monday, Seneca filed with the Securities and Exchange
Commission a presentation dubbed "Saving Dynegy: For All
Shareholders" in connection with its attempts to block Dynegy's
sale to an affiliate of Icahn Enterprises.  The presentation
reiterates Seneca's view that the Icahn deal is being made at the
wrong price, wrong time, and for the wrong reasons.  Seneca
insists Dynegy is worth $7.50 to $8.50 per share today with
significant upside in a recovery.

Seneca also accuses the Dynegy board of rushing to sell the
Company.  According to Seneca, management stands to benefit from
$36 million in change-of-control severance payments (nearly 6% of
Dynegy's equity value) that are largely irrespective of the deal
price.  Seneca said the Special Committee of Dynegy's Board that
abandoned its promise of a "careful standalone review" in favor of
yet another sale agreement and an ill-timed auction for Dynegy
during the heart of the holiday season, is comprised of members
that have only purchased a combined total of less than 16,000
shares.

The Troubled Company Reporter has chronicled Dynegy's attempts to
sell itself.  In August, Dynegy struck a deal to be acquired by an
affiliate of The Blackstone Group at $4.50 a share.  That offer
was raised to $5.00 a share in November.  Through Icahn and
Seneca's efforts, shareholders thumbed down both offers.  On
December 22, 2010, an affiliate of IEP commenced a tender offer to
purchase all of the outstanding shares of Dynegy common stock for
$5.50 per share in cash, or roughly $665 million in the aggregate.

In its presentation, Seneca disclosed that it retained a Big Four
accounting/consulting firm to analyze the potential cost cutting
opportunity at Dynegy by utilizing various benchmarking techniques
and publicly available information on Dynegy and industry peers in
a 'Top Down' analysis.  The accounting firm, Seneca, said did not
consent to the use of its name in the presentation.  Among others,
Seneca said the Big 4 firm's report identified between $82 million
and $157 million of incremental cost-cutting potential starting
from financials for the 12 months ended September 30, 2010.

A full-text copy of Seneca's presentation is available
at http://is.gd/n1NX9h

                   NYPSC Green Lights Icahn Deal

Dynegy on Friday announced that at a January 20, 2011, session of
the New York Public Service Commission, NYPSC granted
authorization for the proposed transaction between Dynegy and
Icahn.  A written ruling to that effect is expected to be issued
by NYPSC in due course.  This determination by NYPSC satisfies one
of the closing conditions of the IEP tender offer.

The IEP tender offer is currently set to expire at midnight
(Eastern Time) on January 25, 2011, unless extended in accordance
with the terms of the IEP-Dynegy merger agreement.  Dynegy has
filed with the Securities and Exchange Commission a Solicitation/
Recommendation Statement on Schedule 14D-9 regarding the tender
offer.

The U.S. Department of Justice and the Federal Trade Commission
have granted early termination of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act related to the
proposed acquisition of Dynegy by an affiliate of IEP.  The only
remaining regulatory approval necessary to satisfy the closing
conditions of the IEP tender offer relates to the Federal Energy
Regulatory Commission.  A joint application filed by Dynegy and
IEP is currently subject to review by FERC, and an order is
expected to be forthcoming.

Goldman, Sachs & Co. and Greenhill & Co., LLC are serving as
financial advisors and Sullivan & Cromwell LLP is serving as legal
counsel to Dynegy.

                        About Dynegy Inc.

Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE:DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets.  The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.

As reported by the Troubled Company Reporter on November 26, 2010,
Fitch Ratings downgraded the ratings of Dynegy Inc. and its
subsidiaries: Dynegy Inc. Issuer Default Rating to 'CCC' from
'B-'; Dynegy Holdings, Inc. IDR to 'CCC' from 'B-'; Secured bank
credit facilities and notes to 'B+/RR1' from BB-/RR1; Senior
unsecured to 'CCC/RR4' from 'B/RR3'; and Dynegy Capital Trust I
preferred to 'C/RR6' from 'CCC/RR6'.

The downgrade reflects Fitch's belief that the rejection of The
Blackstone Group's bid to acquire Dynegy for $5/share will likely
lead to another transaction and capital restructuring by Dynegy's
management as activist stockholders seek to maximize shareholder
values.  The downgrade also reflects the underperformance of
Dynegy's merchant generation operations.  There is a high
correlation ofDynegy's future financial performance to improvement
in power prices, shrinkage in the reserve capacity margins in the
wholesale markets Dynegy owns and operates its generating plants,
and improvement in electricity demand.

In October 2010, Moody's Investors Service lowered the ratings of
Dynegy Holdings, including its Corporate Family Rating, to Caa1
from B3 along with the ratings of various affiliates or parent
company Dynegy Inc.  The rating outlook for DHI and Dynegy remains
negative.  The rating action followed the expiration of the 40-day
"go shop" period, according to Moody's, increasing the probability
that Dynegy will be acquired by an affiliate of The Blackstone
Group L.P. in a transaction valued at approximately $4.7 billion,
including the assumption of existing debt.  Moody's said Dynegy's
financial profile is expected to be quite fragile, particularly
during 2011 and 2012, when the company is projected to generate
both negative operating cash flow and negative free cash flow due
to weak operating margins and the required funding of their
capital investment programs.  To the extent that the transactions
with Blackstone and NRG are not completed, Moody's said downward
rating pressure at DHI and Dynegy will continue to exist given the
weak financial prospects for the company over the next few years
coupled with the liquidity concerns.

Moody's Investors Service believes that the ratings and negative
rating outlook for Dynegy, Inc., and its subsidiary, Dynegy
Holdings, Inc (Caa1 Corporate Family Rating) will remain unchanged
at this time following the announcement that its board had agreed
to be acquired by Icahn Enterprises LP for $5.50 per share in
cash, or approximately $665 million.


EMERGENCY MEDICAL: S&P Puts 'BB' Corporate on CreditWatch Negative
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' corporate
credit rating for Greenwood Village, Colo.-based Emergency Medical
Services Corp., as well as all related issue-level ratings for
subsidiaries EmCare HoldCo and AMR HoldCo, on CreditWatch with
negative implications.  CreditWatch with negative implications
means that the ratings could either be lowered or affirmed
following the completion of S&P's review.

The CreditWatch placement follows reports that Emergency Medical
may be subject to a takeover by a private equity firm.  In S&P's
opinion, a meaningfully debt-laden transaction would weaken
Emergency Medical's credit metrics below current levels, which
include lease-adjusted debt to EBITDA of about 1.9x and funds from
operations to total debt of about 37% for the 12 months ended
Sept. 30, 2010.  S&P expects Emergency Medical to maintain
leverage below 3x to maintain the current 'BB' rating.  In
addition, S&P believes the Company could absorb an additional
$750 million of debt without affecting the financial risk profile
and triggering a downgrade.  However, S&P would consider a
downgrade of the ratings if leverage exceeds 3x and S&P expects it
to remain there on a sustained basis.  Emergency Medical had
$424 million of reported debt as of Sept. 30, 2010.  Currently,
S&P views the Company's business risk profile as fair and its
financial risk profile as intermediate.

"We will resolve the CreditWatch listing when more information
regarding a potential transaction and financing becomes
available," said Standard & Poor's credit analyst Rivka Gertzulin.
"We will then assess the Company's financial policy and the impact
of any potential transaction on the Company's capital structure."


ENCOMPASS DIGITAL: Moody's Gives 'Caa1' on 5.3x debt-to-EBITDA
--------------------------------------------------------------
Moody's Investors Service assigned a Caa1 Corporate Family Rating
and a Caa1 Probability of Default Rating for Encompass Digital
Media, Inc.  Moody's also assigned B2 (LGD2 - 29%) ratings to the
company's proposed $20 million first lien revolver due 2016 and
$175 million first lien term loan B due 2016, which fund the
$120 million acquisition of the content and distribution business
of Ascent Media Inc. and refinance existing debt.  The rating
outlook is stable.

These ratings were assigned:

Issuer: Encompass Digital Media, Inc.

  -- Corporate Family Rating: Caa1
  -- Probability of Default Rating: Caa1
  -- New first lien revolver due 2016 -- B2 (LGD2, 29%)
  -- New first lien term loan B due 2016 -- B2 (LGD2, 29%)
  -- The rating outlook is stable.

Encompass' Caa1 CFR broadly reflects high financial risk, as
evidenced by debt-to-EBITDA leverage of approximately 5.3x and
weak fixed charge coverage of just over one time, and business
risks associated with being a provider of outsourced services.
The majority of revenues is generated from large content
providers, including major cable and broadcast networks, some of
which provide most of their own, in-house origination and
transmission.  Encompass provides third-party origination and
transmission for a portion of these clients' needs.  Customers are
willing to outsource a portion of their business to the extent
Encompass provides competitive service and technology, thereby
allowing them to avoid capital spending on infrastructure and
technology upgrades to bring such business in-house.  A track
record for providing the latest technology as well as dependable,
error free transmission and 24/7 service is critical.  Ratings are
supported by multi-year contracts for more than 80% of revenues
combined with a $549 million backlog. Ratings are also supported
by the company's consistent relationships and high renewal rates.
Given maturation of cable channel proliferation, incremental
demand for third-party origination and distribution services is
expected to be driven by the outsourcing of upgraded content
management in High Definition/3D versus Standard Definition,
proliferation of multiple file formats, potential demand for
disaster recovery services, and development of TV broadcast
central-casting.  Revenues are not advertising-based and dollars
spent on origination and distribution were sustained during the
economic downturn.  The Caa1 CFR reflects very limited free cash
flow-to-total debt of about 4%-to-5% as expected in the first
year, and accommodates the accrual of PIK interest on $95 million
of unrated second lien debt' held entirely by Tennenbaum Funds.

The total interest rate, including PIK and cash component, exceeds
the rate on the 1st lien debt and results in 1.2x EBITDA - capex
coverage of interest expense and roughly flat debt balances for
the first 12 months.  Encompass has grown through acquisitions,
and with the pending purchase of Ascent Media's content
distribution businesses revenues and EBITDA are expected to double
in size.  Risks arise from the rapid growth through acquisition;
however, the pending transaction geographically diversifies
operations across the U.S. and establishes facilities in the UK
and Singapore.  In addition, the combined entities have a track
record of capital spending in excess of the company's current
business plan.  To the extent Encompass chooses to increase
capital spending above its plan, liquidity would notably be
strained given modest free cash flow and approximately $15 million
of expected revolver availability.

The stable outlook reflects Moody's view that Debt-to EBITDA will
be sustained below 5.75x after the first 12 months as Encompass
assimilates newly acquired operations in the U.S. as well as the
U.K. and Singapore.  The outlook also reflects expectations that
the company's multi-year backlog will continue to support
predictable revenue performance, liquidity will be adequate and
EBITDA margins will remain at current levels.  Ratings could be
downgraded if revenue and EBITDA fall short of management's plan
due to a decline in contract renewals or an inability to develop
new business resulting in Debt-to-EBITDA ratios greater than 6.0x.
A decrease in backlog and erosion of margins resulting in weakened
liquidity and deterioration in EBITDA cushion relative to
financial maintenance covenant requirements would create downward
rating pressure.  An upgrade could be considered if total debt-to-
EBITDA is sustained comfortably below 4.75x and first lien debt-
to-EBITDA is sustained comfortably below 2.0x, with free cash
flow-to-debt ratios greater than 7%.

The principal methodology used in determining instrument ratings
was Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.

Encompass Digital Media, Inc., headquartered in Los Angeles, CA,
is a leading provider of outsourced network origination and
transmission services to broadcasters, cable channels and other
media companies.  With the acquisition of satellite services
businesses of Crawford Communications in January 2010 and the
pending acquisition of the content distribution businesses of
Ascent Media, Encompass becomes a leading provider of outsourced
services to the major producers and distributors of motion
pictures and television programs in the U.S., Europe and Asia.
Encompass is owned primarily through an investment of an affiliate
of Wasserstein & Co. in addition to executive management and
Tennenbaum Funds.  Through December 31, 2010, pro forma LTM
revenue was approximately $197 million.


EXTENDED STAY: Affiliates File Post-Confirmation Report for Q4
--------------------------------------------------------------
Extended Stay Inc. prepared a post-confirmation quarterly
operating report for 74 of its affiliated debtors whose Fifth
Amended Joint Chapter 11 Plan of Reorganization had been
confirmed by the U.S. Bankruptcy Court for the Southern District
of New York.

The Operating Report, which covers the period October 1 to
December 31, 2010, disclosed that the Plan Debtors had
$230,586,968 in total cash receipts and $197,020,337 in total
disbursements for the reporting period.

Plan-related payments disbursed during the reporting period total
$127,726,544.

The Plan Debtors did not sell or transfer any assets outside the
normal course of business or outside the restructuring plan
during the reporting period.

The Plan Debtors are also current on all post-confirmation plan
payments, according to the Report.

A full-text copy of the Oct. to Dec. 2010 Post-Confirmation
Quarterly Operating Report is available without charge at:

    http://bankrupt.com/misc/ESI_PostConQReportDec3110.pdf

                       About Extended Stay

Extended Stay is the largest owner and operator of mid-price
extended stay hotels in the United States, holding one of the most
geographically diverse portfolios in the lodging sector with
properties located across 44 states (including 11 hotels located
in New York) and two provinces in Canada.  As a result of
acquisitions and mergers, Extended Stay's portfolio has expanded
to encompass over 680 properties, consisting of hotels directly
owned or leased by Extended Stay or one of its affiliates.
Extended Stay currently operates five hotel brands: (i) Crossland
Economy Studios, (ii) Extended Stay America, (iii) Extended Stay
Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe
Studios.

Extended Stay Inc. and its affiliates filed for Chapter 11 on
June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764).  Judge James M.
Peck handles the case.  Marcia L. Goldstein, Esq., at Weil Gotshal
& Manges LLP, in New York, represents the Debtors.  Lazard Freres
& Co. LLC is the Debtors' financial advisors.  Kurtzman Carson
Consultants LLC is the claims agent.  The Official Committee of
Unsecured Creditors tapped Gilbert Backenroth, Esq., Mark T.
Power, Esq., and Mark S. Indelicato, Esq., at Hahn & Hessen LLP,
in New York, as counsel.  Extended Stay had assets of
$7.1 billion and debts of $7.6 billion as of the end of 2008.

Extended Stay Inc. in October successfully emerged from Chapter 11
protection.  An investment group including Centerbridge Partners,
L.P., Paulson & Co. Inc. and Blackstone Real Estate Partners VI,
L.P.  has purchased 100 percent of the Company for $3.925 billion
in connection with the Plan of Reorganization confirmed by the
Bankruptcy Court in July.

Bankruptcy Creditors' Service, Inc., publishes Extended Stay
Bankruptcy News.  The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings undertaken by Extended Stay Inc. and
its various affiliates. (http://bankrupt.com/newsstand/or
215/945-7000).


EXTENDED STAY: Files Declarations for Nov.-Dec. Disbursements
-------------------------------------------------------------
Joseph Teichman, secretary and general counsel of Extended Stay
Inc., filed declarations with the U.S. Bankruptcy Court for the
Southern District of New York disclosing that the company has not
made any disbursements in the past two months.

Mr. Teichman filed the declaration in lieu of ESI's monthly
operating reports for November and December 2010, and in
compliance with a recent agreement between the U.S. Trustee and
Weil Gotshal Manges LLP, under which ESI won't be required to
file the report if it has not made any disbursements during the
reporting period.

ESI is not part of the restructuring plan that was confirmed by
the Court and thus, is still required to continue to file a
monthly operating report.

ESI's 74 affiliated debtors, which were reorganized pursuant to
the confirmed Plan, have been required to file operating reports
on a quarterly basis after the restructuring plan took effect on
October 8, 2010.

                       About Extended Stay

Extended Stay is the largest owner and operator of mid-price
extended stay hotels in the United States, holding one of the most
geographically diverse portfolios in the lodging sector with
properties located across 44 states (including 11 hotels located
in New York) and two provinces in Canada.  As a result of
acquisitions and mergers, Extended Stay's portfolio has expanded
to encompass over 680 properties, consisting of hotels directly
owned or leased by Extended Stay or one of its affiliates.
Extended Stay currently operates five hotel brands: (i) Crossland
Economy Studios, (ii) Extended Stay America, (iii) Extended Stay
Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe
Studios.

Extended Stay Inc. and its affiliates filed for Chapter 11 on
June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764).  Judge James M.
Peck handles the case.  Marcia L. Goldstein, Esq., at Weil Gotshal
& Manges LLP, in New York, represents the Debtors.  Lazard Freres
& Co. LLC is the Debtors' financial advisors.  Kurtzman Carson
Consultants LLC is the claims agent.  The Official Committee of
Unsecured Creditors tapped Gilbert Backenroth, Esq., Mark T.
Power, Esq., and Mark S. Indelicato, Esq., at Hahn & Hessen LLP,
in New York, as counsel.  Extended Stay had assets of
$7.1 billion and debts of $7.6 billion as of the end of 2008.

Extended Stay Inc. in October successfully emerged from Chapter 11
protection.  An investment group including Centerbridge Partners,
L.P., Paulson & Co. Inc. and Blackstone Real Estate Partners VI,
L.P.  has purchased 100 percent of the Company for $3.925 billion
in connection with the Plan of Reorganization confirmed by the
Bankruptcy Court in July.

Bankruptcy Creditors' Service, Inc., publishes Extended Stay
Bankruptcy News.  The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings undertaken by Extended Stay Inc. and
its various affiliates. (http://bankrupt.com/newsstand/or
215/945-7000).


F&G LEONARD: Taberna Country Club Owner Mulls Bankruptcy
--------------------------------------------------------
Laura Oleniacz at ENCToday reports that the owners of the Taberna
Country Club and Golf Course will likely file for Chapter 11
bankruptcy in an attempt to head off a creditor's foreclosure and
subsequent sale of the property, an attorney for the owners said.

"We will stop the foreclosure before it occurs," Rodney Currin, an
attorney with the firm Stubbs & Perdue, said.  "The people who are
running the club will continue to run it in the same fashion that
it was run before.  In other words, the club is not going to shut
down or go out of business."

Mr. Currin said members should not notice any change in the club's
operations in the event of a Chapter 11 filing.

According to the report, documents filed January 5 in the Craven
County Courthouse, says Club owner F&G Leonard LLC had a balance
of more than $2.73 million on the $3.75 million loan as of Dec.
31, 2010.

A hearing on the foreclosure is scheduled for Thursday, Jan. 27,
and the foreclosure sale of the 218-acre property that contains
the club and golf course is scheduled for Feb. 25.


FAIRPOINT COMMUNICATIONS: New Stock Begins Trading on Nasdaq
------------------------------------------------------------
FairPoint Communications, Inc. (FRP 24.50, +1.50, +6.52%),
announced January 25 that shares of its common stock have begun
trading on the Nasdaq Stock Market under the ticker symbol FRP.

"Today's Nasdaq listing marks the culmination of the recent
financial restructuring process," said Paul H. Sunu, CEO of
FairPoint.

On January 24, 2011, FairPoint emerged from Chapter 11 bankruptcy
protection with a considerably deleveraged balance sheet. As of
the emergence date, the Company had approximately $1.0 billion of
debt outstanding and approximately 26.3 million shares outstanding
(including shares held in reserve for certain pre-petition
claims).

FairPoint will continue to use Bank of New York Mellon as the
transfer agent for its common stock. Questions for the transfer
agent should be directed to Bank of New York Mellon Shareowner
Services at 1-877-295-8608.

                   About FairPoint Communications

FairPoint Communications, Inc. (NYSE: FRP) --
http://www.fairpoint.com/-- owns and operates local exchange
companies in 18 states offering advanced communications with a
personal touch, including local and long distance voice, data,
Internet, television and broadband services.  FairPoint is traded
on the New York Stock Exchange under the symbols FRP and FRP.BC.

FairPoint and its affiliates filed for Chapter 11 protection on
October 26, 2009 (Bankr. S.D.N.Y. Case No. 09-16335).  Rothschild
Inc. is acting as financial advisor for the Company; AlixPartners,
LLP as the restructuring advisor; and Paul, Hastings, Janofsky &
Walker LLP is the Company's counsel.  BMC Group is claims and
notice agent.

As of June 30, 2009, FairPoint reported $3.24 billion in
total assets, $321.41 million in total current liabilities,
$2.91 billion in total long-term liabilities, and $1.23 million
in stockholders' equity.

Andrews Kurth is counsel to the Official Committee of Unsecured
Creditors.  Altman Vilandrie is the operational consultant to the
Creditors' Committee.  Verrill Dana is the Creditors' Committee's
special regulatory counsel.  Jeffries serves as the Creditors'
Committee's financial advisor.

FairPoint Communications on January 24, 2011, successfully
completed its balance sheet restructuring and emerged from Chapter
11.  As a result of the restructuring, FairPoint has reduced its
outstanding debt by approximately 64%, from approximately $2.8
billion (including interest rate swap liabilities and accrued
interest) to approximately $1.0 billion.  In addition, the Company
has a $75 million revolving credit facility available for working
capital and general corporate purposes.  Existing stock in the
Company was cancelled and holders did not receive any
distributions.

                           *     *     *

This concludes the Troubled Company Reporter's coverage of
FairPoint Communications until facts and circumstances, if any
emerge that demonstrate financial or operational strain or
difficulty at a level sufficient to warrant renewed coverage.


FEDERAL MORTGAGE: Founders Face Suit for Alleged Ponzi Scheme
-------------------------------------------------------------
The Edmonton Journal's Gary Lamphier reports that Jay Peers and
his two sons are facing a class action lawsuit for running "a
classic Ponzi scheme" that cost investors in his now-bankrupt
companies tens of millions of dollars.  According to the Edmonton
Journal, the civil suit, filed by two West Coast residents who
invested more than $3.1 million in Edmonton, Canada-based Federal
Mortgage Corp. Ltd. and Peers Foster Kristiansen Inc., alleges
that returns from Mr. Peers' failed companies were covered by
funds from incoming investors.

The suit says "So far as is known to date, of a total invested of
$72 million, over $30 million was shown to have been invested in
ventures or properties owned directly or indirectly by Robert,
Marc and Jay Peers."

The Edmonton Journal says none of the allegations made in the suit
have been proven in court and as of late Friday, a statement of
defence had not been filed with the court.

The Edmonton Journal relates the class-action lawsuit was filed by
plaintiffs Robert and Charity Mewburn in Edmonton's Court of
Queen's Bench of Alberta against Mr. Peers, his sons Robert and
Marc -- who ran two related firms in Calgary -- and FMC directors
Dawn Vader, Sharma Laleeni and David Kauffman.

Mr. Peers' companies filed for bankruptcy in early December, and
PricewaterhouseCoopers Inc., the court-appointed bankruptcy
trustee, held its first meetings with creditors on Jan. 12.  The
Mewburns' suit was filed two days later.

The Edmonton Journal relates more than 400 investors, their
spouses, lawyers and accountants attended the Jan. 12 creditors'
meetings at Edmonton's Mayfield Inn.  Some of the unsecured
creditors named in the trustee's filings are owed $500,000 or
more, and many are senior citizens who appear to have put the bulk
of their life savings into FMC.

The Mewburns are seeking a court order certifying the suit as a
class action proceeding on behalf of other FMC and PFK investors.


FLINT TELECOM: Files Prospectus for 12-Mil. Shares Held by Kodiak
-----------------------------------------------------------------
Flint Telecom Group, Inc., filed a registration statement on Form
S-1 with the Securities and Exchange Commission on January 21,
2011, for the resale by shareholder Kodiak Capital Group, LLC, of
up to 12,000,000 shares of the Company's common stock, par value
$0.01 per share.   The shares of common stock offered under this
prospectus by Kodiak are issuable to Kodiak pursuant to the
Investment Agreement entered into by and between Kodiak and the
Flint Telecom Group, Inc., dated November 26, 2010 and
subsequently amended on January 21, 2011.  The Company will not
receive any proceeds from the sale of these shares by Kodiak.
This registration statement covers only a portion of the shares of
common stock that may be issuable pursuant to the IA.  The Company
may file subsequent registration statements covering the resale of
additional shares of common stock issuable pursuant to the IA with
Kodiak.  The Company will bear all costs associated with this
registration statement.

Kodiak may sell the shares of common stock in a number of
different ways and at varying prices.  The Company provides
further information about how Kodiak may sell its shares of common
stock in the section entitled "Plan of Distribution."  Kodiak is
an "underwriter" within the meaning of the Securities Act of 1933,
as amended, in connection with the resale of the Company's common
stock under the IA.

The Company's shares of common stock are quoted on the OTCBB under
the symbol "FLTT.OB." On January 19, 2011, the closing sale price
of the Company's common stock was $0.017 per share.

                        About Flint Telecom

Overland Park, Kan.-based Flint Telecom Group, Inc. (OTC BB: FLTT)
-- http://www.flinttelecomgroup.com/-- delivers next-generation
IP communications Products and Services.  As part of the Company's
ongoing emphasis on streamlining its operations and reaching
sustainable profitability, during the year ended June 30, 2010,
the Company shut down and disposed of four operating companies:
CVC Int'l, Phone House Inc. of Florida, Dial-Tone Communications
and Starcom Alliance.

The Company's balance sheet at September 30, 2010, showed
$2.2 million in total assets, $14.8 million in total liabilities,
all current, $4.6 million in redeemable equity securities, and a
$17.3 million stockholders' deficit.

As reported in the Troubled Company Reporter on October 26, 2010,
L.L, Bradford & Company, LLC, in Las Vegas, Nev., expressed
substantial doubt about the Company's ability to continue as a
going concern, following the Company's results for the fiscal year
ended June 30, 2010.  The independent auditors noted that the
Company has suffered losses from operations, negative cash flows
from operations and current liabilities exceed current assets.


FOR 1031: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: FOR 1031 Dorado LLC
        12426 W. Explorer Drive
        Boise, ID 83713

Bankruptcy Case No.: 11-10215

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       District of Delaware (Delaware)

Judge: Peter J. Walsh

Debtor's Counsel: Natasha M. Songonuga, Esq.
                  GIBBONS PC
                  1000 N. West Street, Suite 1200
                  Wilington, DE 19801
                  Tel: (302) 295-4875
                  Fax: (302) 295-4876
                  E-mail: nsongonuga@gibbonslaw.com

Scheduled Assets: $1,821,225

Scheduled Debts: $2,121,839

The Company did not file a list of creditors together with its
petition.

The petition was signed by Conrad Myers, as Trustee of the DBSI
R.E. Liquidating Trust, successor.


FUQI INT'L: NASDAQ Grants Firm's Request for Continued Listing
--------------------------------------------------------------
FUQI International, Inc. disclosed that a NASDAQ Listing
Qualifications Panel has granted the Company's request for an
extension of time, as permitted under NASDAQ's Listing Rules, to
comply with the annual shareholder meeting and proxy solicitation
requirements set forth in NASDAQ Listing Rules 5620(a) and
5620(b), respectively. In accordance with the Panel's decision,
the Company must solicit proxies and hold its annual meeting on or
before May 9, 2011.

As previously reported, on September 29, 2010, FUQI received a
NASDAQ notice of noncompliance due to the delay in certain filings
with the Securities and Exchange Commission and that the Company's
securities were subject to delisting unless it requested a
hearing.  The Company timely requested a hearing and appeared
before the Panel on November 11, 2010.  On December 9, 2010, the
Panel rendered its determination to continue the Company's listing
subject to an extension through March 28, 2011, by which date the
Company must file with the SEC all delayed reports and any
required restatements.

                   About FUQI International

Based in Shenzhen, China, FUQI International, Inc. is a leading
designer, producer and seller of high quality precious metal
jewelry in China. FUQI develops, promotes, manufactures and sells
a broad range of products consisting of unique styles and designs
made from gold and other precious metals such as platinum and
Karat gold.


GALLE GLOBAL: Hedge Fund to Liquidate Amid Losses
-------------------------------------------------
Saijel Kishan at Bloomberg News reports that Galle Global Macro
Partners LLC, the hedge fund founded by Sri "Wije" Wijegoonaratna,
a former Fortress Investment Group LLC executive, is shutting down
about a year after it started.

The firm, based in New York, plans to return most money to
investors next month, Mr. Wijegoonaratna said in a letter to
clients January 13.

"With the past few months' redemptions, our asset base has
unfortunately become too unstable to support our original vision
of a full-scale institutional macro business," he said in the
letter, a copy of which was obtained by Bloomberg News. "As a
result, we have decided that it is in the best interests of the
GGM investors to close all of our funds as of January 31."

Mr. Wijegoonaratna, who started his firm in February with $450
million, said he was "disappointed" with his performance.  Macro
funds, which trade everything from currencies to commodities,
returned 2.2% on average last year, according to data compiled by
Bloomberg, while hedge funds of all types averaged gains of 7% as
global markets rallied.

Bloomberg News also reports that Shafiq Karmali, a former Goldman
Sachs Group Inc. trader, planned to shut his hedge fund, Cypress
Lane, a little more than a year after starting it, three people
briefed on the decision said in November.


GR HOLDING: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: GR Holding, LLC
        9708 Fort Colony Way
        Tampa, FL 33615

Bankruptcy Case No.: 11-01074

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       Middle District of Florida (Tampa)

Debtor's Counsel: Tom H. Billiris, Esq.
                  TOM H. BILLIRIS, PA
                  2311 ALT 19 STE 5
                  Palm Harbor, FL 34683-2631
                  Tel: (727) 786-7200
                  E-mail: tbilliri@tampabay.rr.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 Galal Ramadan, member.


GULF FLEET: U.S. Trustee Appoints Seven-Member Creditors Committee
------------------------------------------------------------------
R. Michael Bolen, U.S. Trustee for Region 5 appointed seven
members to the official committee of unsecured creditors in the
Chapter 11 cases of Gulf Fleet Holdings, Inc., et al.

The Creditors Committee members are:

1. Hudson Drydocks, Inc.
   Attn: Wendle Huddleston
   1809 West Garner Street
   Morgan City, LA 70380
   Tel: (985) 384-6492
        (985) 759-1131

2. Vacco Marine, Inc.
   Attn: Laura Lee Smith
   P.O. Box 8032
   Houma, LA 70361
   Tel: (985) 851-4400
   Fax: (985) 851-4141

3. Cummins Mid-South, LLC
   Attn: Mark Whitehead
   3770 South Perkins Road
   Memphis, TN 38118
   Tel: (901) 577-0670
   Fax: (901) 522-8758

4. Qorval, LLC
   Attn: Judy M. Levy
   2210 Vanderbilt Beach Road, Suite 1206
   Naples, FL 34109
   Tel: (239) 280-5799
   Fax: (239) 435-9777

5. Thoma-Sea Boat Builders, L.L.C.(non-voting member)
   Attn: Walter Thomassie
   P.O. Box 399
   Bourg, LA 70343
   Tel: (985) 532-5515
   Fax: (985) 853-0702

6. NREC Power Systems
   Attn: Bryan F. Chaisson
   P.O. Box 3016
   5222 Highway 311
   Houma, LA 70361-3010
   Tel: (985) 872-5480
   Fax: (985) 872-0611

7. Doerle Food Services, LLC
   Attn: Christie Boutte
   113 Kol Drive
   Broussard, LA 70518
   Tel: (337) 252-8551 (ext. 1011)
   Fax: (337) 252-8559

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtor's
expense.  They may investigate the Debtor's business and financial
affairs.  Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.  Those
committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

The Committee is represented by:

     Alan H. Goodman, Esq.
     601 Poydras, No. 2100
     New Orleans, LA 70112
     Tel: (504) 584-9419
     Email: agoodman@lemle.com

     Christopher D. Johnson, Esq.
     Hugh M. Ray, Jr., Esq.
     600 Travis, Suite 7000
     Houston, TX 77002
     Tel: (713) 485-7300
     Fax : (713) 485-7344
     Email: cjohnson@mckoolsmith.com

                         About Gulf Fleet

Lafayette, Louisiana-based Gulf Fleet Holdings, Inc. -- along with
affiliates Star Marine, LLC; Gulf Wind, LLC; Gulf Service, LLC;
Gulf Worker, LLC; Hercules Marine, LLC; Gulf Fleet, LLC; Gulf
Fleet Marine, Inc.; Gulf Fleet Management, LLC; Gulf Fleet
Offshore, LLC; and Gulf Ocean Marine Services, LLC -- sought
Chapter 11 protection (Bankr. W.D. La. Case No. 10-50713) on
May 14, 2010.  Benjamin W. Kadden, Esq., Christopher T.
Caplinger, Esq., and Stewart F. Peck, Esq., at Lugenbuhl, Wheaton,
Peck, Rankin & Hubbard in New Orleans, La., represent the Debtors.
The Debtor is operating under the terms of cash collateral
agreements with lenders led by Comerica Bank and Brightpoint
Capital Partners Master Fund, L.P.

Gulf Fleet estimated $100 million to $500 million in assets and
$50 million to $100 million in debts in its Chapter 11 petition.
In their schedules, affiliate Gulf Fleet, LLC, disclosed
$2,088,277 in assets and $83,891,116 in liabilities; Gulf Fleet
Management, LLC, disclosed $943,256 in assets and $45,071,399 in
liabilities; and Gulf Ocean Marine Services, LLC, disclosed
$15,777,138 in assets and $79,513,230 in liabilities.


HELIX ENERGY: S&P Downgrades Senior Unsecured Rating to 'CCC+'
--------------------------------------------------------------
Standard & Poor's Ratings Services took several rating actions on
16 U.S. oil and gas exploration and production companies following
an industry review.  S&P's review on the sector followed S&P's
Sept. 30, 2010, revision of S&P's exploration and production
recovery criteria.  The new approach aims to better reflect S&P's
expectation for commodity prices and reserve values in a default
scenario.

The rating actions S&P took, were on speculative-grade companies
and affected specific issues and their respective recovery
ratings. S&P did not take any corporate credit rating actions.
(Standard & Poor's recovery rating scale ranges from '6',
indicating expectations of negligible [0%-10%] recovery in a
payment default, to '1+', indicating expectations of full [100%]
recovery.)  S&P included in its reviews an updated reserve report
utilizing S&P's new price deck.

Ratings List
Issue Ratings lowered; Recovery Ratings Revised
                                           To     From
Quicksilver Resources Inc. (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          5      3

BreitBurn Energy Partners (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Ratings                         5      4

Helix Energy Solutions Group Inc. (B/Stable/--)
Senior Unsecured                          CCC+   B-
  Recovery Ratings                         6      5

Rosetta Resources Inc. (B/Stable/--)
Senior Unsecured                          B-     B+
  Recovery Rating                          5      2

Chaparral Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          4      2

NFR Energy LLC (B/Stable/--)
Senior Unsecured                          B-     B
  Recovery Rating                          5      4

Venoco Inc. (B/Stable/--)
Second-Lien Secured                       B      BB-
  Recovery Rating                          4      1

Delta Petroleum Corp. (CCC/Negative/--)
Senior Unsecured                          CCC-   CCC
  Recovery Rating                          5      4

Dune Energy Inc. (CCC-/Negative/Unsolicited)
Second-Lien Secured                       CC       CCC-
  Recovery Rating                          5        4


Issue Ratings Raised; Recovery Ratings Revised
                                           To     From
Penn Virginia Corp. (BB-/Stable/--)
Subordinated                              B+     B
  Recovery Rating                          5      6

Forest Oil Corp. (BB-/Stable/--)
Senior Unsecured                          BB-    B+
  Recovery Rating                          4      5

Clayton Williams Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B-
  Recovery Rating                          4      5


Issue Ratings Unchanged; Recovery Ratings Revised
                                           To     From
Whiting Petroleum Corp. (BB/Stable/--)
Recovery Rating                           4      3

Range Resources Corp. (BB/Stable/--)
Recovery Rating                            3      4

Bill Barrett Corp. (BB-/Stable/--)
Recovery Rating                           3      4

PetroQuest Energy Inc. (B/Stable/--)
Recovery Rating                           4      3


HONOLULU MEDICAL: Process to Release Patient Records Ongoing
------------------------------------------------------------
Dan Nakaso, writing for the Honolulu Star-Advertiser, reports that
Honolulu Medical Group Inc. is still sending records to patients.
The Star-Advertiser relates attorney James Wagner said the process
is continuing to get all requested records to patients by a July
11 deadline, when all records will be destroyed.  The report
relates Mr. Wagner said that, after paying a $42 fee, patients
should expect a 60- to 90-day turnaround period to receive their
records.

A Web site where patients can request their records has been
created at http://honmed.com/

Honolulu Medical Group once claimed to be the state's largest
multispecialty clinic and traced its history back 106 years when
it was founded as Hawaii's first physician group by Dr. James Judd
and Dr. W.D. Baldwin.  By 2009, the Honolulu Medical Group's
roster of 40 physicians had dwindled to just 11 and the group
filed for bankruptcy protection, saying it owed creditors more
than $1 million.

As reported by the Troubled Company Reporter on November 6, 2009,
Honolulu Medical Group Inc. filed for Chapter 11 bankruptcy in
Honolulu, Hawaii.  Erika Engle of Star Bulletin reported that the
Company's attorney James Wagner cited the near-unavoidable
national debate on health care costs as a reason the company fell
so deeply behind.

The Company estimated assets of less than $50,000 and debts of
between $1 million and $10 million in its Chapter 11 petition.


HUNTINGTON INGALLS: Fitch to Give 'BB' After Northrop Spin-Off
--------------------------------------------------------------
Fitch Ratings expects to assign a 'BB' Issuer Default Rating to
Huntington Ingalls Industries Inc. upon the completion of the
company's potential spin-off from Northrop Grumman Corporation.
Fitch also expects to rate HII's proposed five-year senior secured
$600 million term loan facility, five-year $650 million revolving
credit facility, and approximately $1.18 billion of Rule 144A
senior unsecured notes.  Proceeds from the term loan and the notes
will be used to pay a transfer to NOC, repay intercompany debt
owed to NOC, and fund HII's initial liquidity.  Fitch expects the
debt transactions and spin-off will be completed in the first
quarter of 2011.

Fitch expects to assign these ratings on HII:

  -- Long-term IDR at 'BB';
  -- Senior secured term loan at 'BBB-';
  -- Senior secured revolving credit facility at 'BBB-';
  -- Senior unsecured notes at 'BB'.

The Rating Outlook is expected to be Stable. Fitch expects HII
will have approximately $1.9 billion of outstanding debt after the
potential spin-off including the debt mentioned above and
approximately $105 million of senior unsecured legacy debt.

The ratings reflect HII's position as a leading company in the
defense shipbuilding industry with core capabilities in building
aircraft carriers, nuclear submarines, large amphibious attack
vessels, and surface combatants.  The company is the sole source
manufacturer on about 66% of its revenues, including building and
overhauling aircraft carriers for the U.S. Navy, and it has a
large and highly visible backlog.  HII is well-positioned in the
current defense spending environment, with roles on four of the
U.S. Dept. of Defense's (DOD) top 12 programs in the fiscal 2011
budget.  HII also has a high percentage of cost-plus and fixed-
price incentive contracts, which have less risky terms than firm
fixed-price contracts, although margins are generally lower.
Fitch expects the company will follow a conservative financial
strategy after the potential spin-off, and Fitch projects that
most of HII's financial metrics will be solid for the expected
ratings.  Finally, HII's pension funding position is relatively
healthy compared to many other large defense contractors.

Fitch's key concerns include HII's revenue concentration with the
U.S. Navy and Coast Guard, the ongoing restructuring at the
company's Gulf Coast operations, and uncertainty about U.S.
defense spending after fiscal 2012.  HII generates nearly all of
its revenues from the U.S. government, exposing the company to
changes in U.S. Navy and U.S. Coast Guard plans regarding future
fleet needs.  HII will be undergoing an extensive reorganization
at least through 2012 to address performance issues at its Gulf
Coast operations; this restructuring includes the closing of its
Avondale shipyard.  Additional rating concerns include the
company's relatively low margins, weak free cash flow in the past
two years, program execution risks, the percentage of the
workforce that is unionized, exposure to hurricanes, and the lack
of a track record as a standalone company.  HII will need to
develop in-house support functions which are currently handled by
NOC, including some information technology.

Fitch's expectation to notch up the senior secured credit facility
by two rating notches from the IDR to 'BBB-' is based on the
coverage provided by HII's tangible assets and operating EBITDA
compared to the fully drawn facility.  The collateral for the
facility includes substantially all of HII's assets with the
exception of the Avondale shipyard and a few other exclusions.  In
assigning the rating, Fitch noted Newport News' solid backlog and
strategic importance to the U.S. Navy.  The amount of secured debt
compared to the amount of unsecured debt and equity in HII's
expected capital structure also supported Fitch's notching
analysis.

HII is expected to have approximately $600 million of liquidity
consisting of $200 million-$300 million of cash with the remainder
provided by the $650 million revolving facility, with up to
$350 million usable for letters of credit.  The actual liquidity
level may exceed the targeted $600 million if HII does not utilize
the full Letter of Credit allowance under the revolving facility,
but Fitch's forecasts include the assumption that a substantial
portion of the LC facility will be used to cover workers'
compensation.  Debt maturities will be minimal for the next
several years other than amortization of the term loan.  Required
pension contributions should also be manageable given HII's
funding position.  After the spin-off and debt issuances Fitch
expects HII will have leverage of approximately 3.2 times (x)-
3.4x, with the potential for steady improvement over the next
several years with some debt reduction and restructuring-driven
margin expansion.

Lower discretionary pension contributions, a smaller increase in
working capital and lower capital expenditures eased the pressure
on HII's free cash flow in 2010.  HII's FCF in 2009 was negative
$269 million, and Fitch expects FCF to be weak in 2010 and 2011,
although improved from 2009.  Through the nine months ended
Sept. 30, 2010, HII's FCF was $55 million, compared to negative
$329 million for the same period in 2009.  Fitch expects that FCF
could improve materially in 2012 and 2013 as restructuring abates
and some capital spending projects are completed.  Fitch's
projections include no share repurchases or dividends, although
HII's dividend policy will be established by the board of
directors based on HII's financial conditions and other factors.
Fitch's financial projections show that HII should be able to
build cash based on the assumptions of a successful Gulf Coast
restructuring and continued support of the company's programs in
the defense budget.

Defense spending is a key driver of HII's financial performance
and credit quality.  HII generated approximately 99% of its
estimated 2010 revenues from the U.S. government, primarily the
U.S. DOD. Fitch believes the outlook for HII's operations is still
favorable through fiscal 2012.  Beyond fiscal 2012 there is more
uncertainty for core spending levels, due to federal budget
pressures.  Fitch believes that HII has credit metrics strong
enough to withstand lower defense spending levels while retaining
the current ratings.

HII currently is an operating unit of NOC responsible for
approximately 18% of the company's revenues.  HII is the nation's
sole industrial designer, builder, and refueler of nuclear-powered
aircraft carriers and one of only two companies capable of
designing and building nuclear-powered submarines for the U.S.
Navy.  HII is also one of the nation's leading full-service
systems providers for the design, engineering, construction, and
life cycle support of major surface ships for the U.S. Navy, U.S.
Coast Guard, and international navies.  HII has good diversity
within its product lineup as the majority of revenues are driven
by seven to eight major programs.  However, the divestiture will
expose HII to changes in future U.S. Navy and U.S. Coast Guard
funding plans as the company lacks diversification outside of
shipbuilding.

Fitch received three years of audited financial statements of
HII's standalone operations.


HUNTINGTON INGALLS: Moody's Assigns 'Ba2' Corp. Family Rating
-------------------------------------------------------------
Moody's Investors Service assigned new debt ratings to Huntington
Ingalls Industries Inc. including: Ba2 corporate family and
probability of default ratings, Baa3 senior secured bank credit
facility rating, Ba3 senior unsecured bond rating, and a
speculative grade liquidity rating of SGL-2.  The rating outlook
is stable.

The Ba2 CFR reflects Huntington Ingalls' established position as a
critical shipbuilding contractor to the U.S. Navy, with stable
revenues although a moderate return on assets of about 2% to 3%.
Moody's expects 2011 debt to EBITDA of about 4.0 times, which
would be consistent with the Ba2 rating level.  Moody's also
anticipates operating margins should gradually improve over time
which should produce declining financial leverage.

Moody's said, "Huntington Ingalls is a sole builder of U.S. Navy
aircraft carriers, is one of two contractors for U.S. Navy
submarines, and holds a strong position as a surface warship
contractor.  We anticipate the Navy continuing to award contracts
at a pace that basically maintains the company's current backlog
level, which provides good visibility of forward revenues.
Assuming costs in line with recent levels, the rating envisions
EBIT margin improving to the mid-single digit percentage range.
This gradually improving EBIT margin should lower leverage over
time.  Longer term, U.S. fiscal deficits could pressure ship
building outlays but we do not see that as a risk to intermediate-
term revenues.

"We do not anticipate Gulf Coast segment margins will approach
those of the Newport News segment for some time, even with the
planned closure of the Avondale, Louisiana yard.  Although charges
related to the Avondale closure and problems on amphibious ship
contracts have likely concluded, the rating acknowledges that
completing vessels LPD 23 and LPD 25 -- as Avondale closes --
could prove a challenge.  Operational improvements made in recent
periods should permit better performance on future surface
combatant ship contracts, especially the DDG-51 program re-start.
Huntington Ingalls appears reasonably positioned to receive a
meaningful portion of the U.S. Navy's DDG-51 ship construction
contracts, which would be handled by the Gulf Coast segment.

"The speculative grade liquidity rating of SGL-2 reflects a good
liquidity profile, which adds support to the Ba2 CFR.  A beginning
cash balance of about $300 million and no beginning borrowing
expected on the $650 million five-year revolver, provide a
comfortable level of available liquidity.  Near-term maturities
will be limited and we expect the company should be cash flow
generative over 2011.  The SGL-2 anticipates adequate headroom
under the first lien credit facility's financial ratio covenant
tests.

"Upward rating momentum would develop with backlog continuing at
current levels and steadily improving Gulf Coast operations,
leading to an expectation of EBIT margin in the upper single digit
percentage range (8% to 9%).  At this margin level, assuming a
balanced financial policy, leverage metrics would likely improve
to include debt to EBITDA of 3.0 times and free cash flow to debt
above 10%. Expectation of a good liquidity profile would as well
accompany an upgrade."

Downward rating momentum would develop if backlog were to
materially weaken or if Moody's were to expect return on assets
sustained below 1%.  Debt to EBITDA exceeding 5.0 times, or a
weakening liquidity profile could also cause a ratings downgrade.

Ratings assigned, subject to review of final documentation:

  -- $650 million senior secured revolving credit due 2016, Baa3
     LGD2, 21%

  -- $600 million senior secured term loan B due 2016, Baa3 LGD2,
     21%

  -- $575 million senior unsecured notes due 2018, Ba3 LGD5, 74%

  -- $600 million senior unsecured notes due 2021, Ba3 LGD5, 74%

  -- Speculative grade liquidity, SGL-2

When Huntington Ingalls' separation from Northrop Grumman
Corporation occurs, the remaining $22 million of 4.55% Gulf
Opportunity Zone Industrial Revenue Bonds due 2028 will become an
obligation of Huntington Ingalls' main operating company.  At that
time, the GoZone Bonds will no longer benefit from the credit
support of Northrop Grumman Corporation (Baa1).  Moody's therefore
expects to lower the rating of the GoZone Bonds to Ba3 LGD5, 74%
from Baa1 following the spin-off.

The principal methodologies used in this rating were Global
Aerospace and Defense published in June 2010, and Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.

Huntington Ingalls Industries, Inc., after it is spun off of
Northrop Grumman Corporation, will be an independent company.
Huntington Ingalls provides full service design, engineering,
construction, and lifecycle support of major surface ship programs
for the U.S. Navy.  Moody's estimates revenues in 2010 were
approximately $6.5 billion.


HII HOLDING: Loan Upsize Won't Change Term Loan's 'B1' Rating
-------------------------------------------------------------
Moody's Investors Service said HII Holding Corporation's plan to
upsize its Term Loan B to $450 million from $315 million does not
change the firm's Corporate Family Rating or the proposed term
loan's B1 issue rating.

The principal methodology used in this rating was Global Chemical
Industry rating methodology published in December 2009.

HII Holding Corporation's operating subsidiary, Houghton
International Inc., is a specialty chemicals manufacturer and
services firm headquartered in Valley Forge, Pennsylvania, with a
focus on metalworking fluids and chemical management services.
Houghton has announced plans to acquire Shell's metalworking and
hot rolling oil business in 2011.  The company is privately owned
by funds managed by AEA Investors LLC.


INSIGHT HEALTH: Faces Last-Minute Challenges to Restructuring
-------------------------------------------------------------
Dow Jones' DBR Small Cap reports that InSight Health Services
Holdings Corp. said that it's facing a last-minute bid by some of
its creditors to derail its restructuring plan, which the
bankruptcy court is slated to consider approving.

According to DBR, after noteholders questioned the propriety of
the votes cast in favor of InSight's Chapter 11 plan of
reorganization, six of those accepting voters have stepped forward
to ask the bankruptcy court to let them now reject the plan.

In court papers filed, InSight said the creditors' timing was
"highly suspect" and said their request shouldn't be countenanced,
the report notes.

                        The Chapter 11 Plan

The Honorable Arthur J. Gonzalez was scheduled to convene a
combined hearing on Jan. 25, 2011, to pass on the adequacy of the
disclosure statement used to solicit acceptances of InSight Health
Services Holdings Corp.'s prepackaged chapter 11 plan of
reorganization, and to consider whether that plan should be
confirmed.

Under the plan, the Debtors' senior secured notes -- the only
class of claims or interests entitled to vote on the plan -- will
be converted into equity.  The Debtors' general unsecured
creditors are unimpaired and will receive a full recovery on their
general unsecured claims.  Additionally, the Debtors' senior
secured noteholders agree to convey to the equityholders warrants
to acquire two percent of the fully diluted equity in the
reorganized Debtors, in recognition of the Debtors' existing
equityholders' efforts to achieve a successful, consensual
restructuring that preserves value for the Debtors' businesses and
creditors.

Upon the Petition Date, the Debtors have obtained votes accepting
the plan from the holders of over two thirds of the amount of the
senior secured notes.  The Debtors believe that they will obtain
further acceptance of the plan by the proposed December 27, 2010
voting deadline and be able to confirm the plan expeditiously.

The Debtors expect to emerge from the chapter 11 process as a
substantially deleveraged enterprise well positioned to compete
successfully in the competitive diagnostic medical imaging
industry going forward.

A full-text copy of the Plan is available for free at:

       http://bankrupt.com/misc/InsightHealth_Plan_DS.pdf

                        About Insight Health

InSight Health Services Holdings Corp. provides diagnostic medical
imaging services through a network of fixed-site centers and
mobile facilities.  Its services-including magnetic resonance
imaging, positron emission tomography and computed tomography,
traditional computed tomography, mammography, bone densitometry,
ultrasound and x-ray-are noninvasive procedures that generate
representations of internal anatomy on film or digital media,
which are used by physicians for the diagnosis and assessment of
diseases and other medical conditions.  The Company operates in
more than 30 states and target specific regional markets.

Insight Health Services Holdings Corp. and its affiliate, InSight
Health Services Corp., sought Chapter 11 protection (Bankr. D.
Del. Case Nos. 07-10700 and 07-10701) on May 29, 2007, with a
prepackaged bankruptcy plan that was confirmed on July 10, 2007,
and declared effective on August 1, 2007.

InSight Health Services Holdings Corp. made a second trip to the
bankruptcy court (Bankr. S.D.N.Y. Lead Case No. 10-16564) on
Dec. 10, 2010, with another prepackaged Chapter 11 plan of
reorganization   Sixteen affiliates also filed for Chapter 11
protection.

InSight is represented by Edward O. Sassower, Esq., James H.M.
Sprayregan, Esq., and Ryan Blaine Bennett, Esq., at Kirkland &
Ellis LLP.  Zolfo Cooper is the Debtors' financial advisor, and
BMC Group Inc. is the claims and noticing agent.

Chris L. Dickerson, Esq. -- chris.dickerson@skadden.com -- and
Matthew M. Murphy, Esq. -- matthew.murphy@skadden.com -- at
Skadden, Arps, Slate, Meagher & Flom LLP in Chicago, Ill.,
represent an ad hoc group of Noteholders in the Debtors' cases.
The Debtors' prepetition secured lenders are represented by C.
Edward Dobbs, Esq. -- edobbs@phrd.com -- at Parker, Hudson, Rainer
& Dobbs LLP in Atlanta, Ga.


JEFFERSON WINDOMERE: Case Summary & 5 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Jefferson Windomere, LLC
          dba Zangwood Villas
              Zangwood Villa Apartments
        509 N. Winnetka Avenue, Suite 201
        Dallas, TX 75208
        Tel: (214) 941-5600

Bankruptcy Case No.: 11-30507

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       Northern District of Texas (Dallas)

Judge: Harlin DeWayne Hale

Debtor's Counsel: Stephen Warner Tiemann, Esq.
                  STEPHEN W. TIEMANN, ATTORNEY AT LAW
                  2000 E. Lamar Boulevard, Suite 600
                  Arlington, TX 76006
                  Tel: (817) 275-7245
                  Fax: (817) 275-1056
                  E-mail: steve@swtlaw.net

Scheduled Assets: $725,689

Scheduled Debts: $1,138,918

A list of the Company's five largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/txnb11-30507.pdf

The petition was signed by Anil Malhotra, director and member.


LANDAMERICA FIN'L: Class Suit Goes Back to C.D. Calif. Ct.
----------------------------------------------------------
Bankruptcy Judge Kevin R. Huennekens granted the plaintiffs'
request to abstain from hearing the suit, Robert Hagan, Lori
Northcutt and John Ray, v. Lawyers Title Insurance Corporation,
Commonwealth Land Title Company, Chicago Title Insurance Company,
Fidelity National Financial, Inc., and Fidelity National Title
Insurance Company, Adv. Pro. No. 10-03168 (Bankr. E.D. Va.), and
transfer venue back to the United States Bankruptcy Court for the
Central District of California pursuant to 28 U.S.C. Sec. 1412 and
Federal Rule of Bankruptcy Procedure 7087.

The Plaintiffs filed the original complaint before the Superior
Court of the State of California, County of Orange, on April 2,
2010.  The Original Complaint, styled as a class action, asserts
four causes of action against the Defendants seeking severance
benefits on behalf of individuals who were or are employed in
California by Lawyers Title or Commonwealth Title.  On May 26,
2010, the Defendants removed the Original Complaint to the
California Bankruptcy Court.  On September 29, 2010, the
California Bankruptcy Court granted the Defendants' Amended Motion
to Transfer Venue and transferred the removed action to the
Chapter 11 case of LandAmerica Financial Group, Inc.

Judge Huennekens held that the Virginia Bankruptcy Court has
subject matter jurisdiction over the lawsuit and that mandatory
abstention under 28 U.S.C. Sec. 1334(c)(2) is improper.
Nevertheless, the Court has carefully chosen to exercise its
discretion under 28 U.S.C. Sec. 1334(c)(1) to abstain from hearing
the removed action.  Judge Huennekens said the adversary
proceeding will have only a minimal effect upon the administration
of the LandAmerica Bankruptcy Case.

A copy of Judge Judge Huennekens' January 21, 2011 Memorandum
Opinion is available at http://is.gd/pahbZvfrom Leagle.com.

                   About LandAmerica Financial

LandAmerica Financial Group, Inc., provided real estate
transaction services with offices nationwide and a vast network of
active agents.  LandAmerica Financial Group and its affiliate
LandAmerica 1031 Exchange Services, Inc. filed for Chapter 11
protection Nov. 26, 2008 (Bankr. E.D. Va. Lead Case No. 08-35994).
Attorneys at Willkie Farr & Gallagher LLP and McGuireWoods LLP
served as co-counsel.  Zolfo Cooper served as the restructuring
advisor.  Epiq Bankruptcy Solutions served as claims and notice
agent.

Attorneys at Akin Gump Strauss Hauer & Feld LLP and Tavenner &
Beran, PLC, served as counsel to the Creditors Committee of 1031
Exchange.  Bingham McCutchen LLP and LeClair Ryan served as
counsel to the Creditors Committee of LFG.

In its bankruptcy petition, LFG reported total assets of
$3,325,100,000, and total debts of $2,839,800,000 as of
Sept. 30, 2008.

On March 6, 2009, affiliate LandAmerica Assessment Corporation,
aka National Assessment Corporation, filed its own Chapter 11
petition.  Affiliate LandAmerica Title Company filed for for
Chapter 11 relief on March 27, 2009.   LandAmerica Credit
Services, Inc., filed for Chapter 11 in July 2009.

LandAmerica filed a Joint Plan of Liquidation on Sept. 9, 2009.
The Bankruptcy Court confirmed that plan on Nov. 23, 2009, and the
plan took effect on Dec. 7, 2009.


LEHMAN BROTHERS: CalPERS Recoups Losses From LBHI Collapse
----------------------------------------------------------
The California Public Employees' Retirement System is now worth
just as much as when Lehman Brothers Holdings Inc. went bankrupt
in 2008 and wiped out $6.8 trillion in U.S. stock-market value in
six months, according to a January 19, 2011 report by Bloomberg
News.

Even with the gain, the largest U.S. public pension today has
only about 70% of the money it needs to cover benefits promised
to government workers.  CalPERS, which lost almost a third of its
value in the crash, has had to demand more from taxpayers to
cover those costs.

Calpers had assets of about $225 billion when Lehman filed for
bankruptcy.  That fell to $164.7 billion by January 31, 2009, and
reached $227 billion as of January 13 this year.  Its all-time
high was about $260 billion in October 2007 when the global
recession began, according to the report.

David Crane, former chief adviser of Governor Arnold
Schwarzenegger on jobs and the economy, said the fund is still
on the hook to pay for benefit increases.

"It's debt as real as any other debt and it's taking an enormous
amount of money away from other programs," Bloomberg News quoted
Mr. Crane as saying.

"What matters is disclosure.  When the state in 1999
retroactively granted pension increases for state workers, that's
the same thing as issuing debt," Mr. Crane told Bloomberg.

In 1999, flush with profits from the dot-com boom, CalPERS won
passage of legislation that retroactively boosted retirement
benefits at the same time it lowered contributions from the state
and local governments.

Proponents of the increase at the time said investment gains that
would push the Dow Jones Industrial Average to more than 20,000
points by 2010 would cover the cost.  Then the financial crisis
hit in 2008, which resulted in CalPERS losing a decade's worth of
value, Bloomberg reported.

                       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.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

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: E&Y Seeks Transfer of Lawsuit to Federal Court
---------------------------------------------------------------
Ernst & Young LLP has asked for the transfer of a lawsuit by New
York's former attorney general over its audits of Lehman Brothers
Holdings Inc. to federal court from state court, according to a
January 19, 2011 report by Reuters.

The firm said the litigation over whether it complied with
federal auditing standards must be heard in federal court, citing
U.S. securities law and the Sarbanes-Oxley corporate governance
act.  It wants the case assigned to U.S. District Judge Lewis
Kaplan who is handling similar legal issues in another Lehman
case, Reuters reported.

Andrew Cuomo, former New York state attorney general, filed the
lawsuit against Ernst & Young for allegedly approving the so-
called repo transaction, an artificial sale and buy-back deal
that enabled Lehman to hide billions of debts from regulators and
allowed the company to look healthier when it reported quarterly
financial data.

Mr. Cuomo accused the firm of giving clean opinions on Lehman's
financial statements although they concealed massive repo
transactions instead of exposing the accounting fraud.

The New York state aims to recover over $150 million Ernst &
Young charged Lehman from 2001 to 2008.

A spokesman for current New York Attorney General Eric
Schneiderman did not issue an immediate comment, Reuters noted.

                       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.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

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 Trustee Opposes Newport Plea for Affidavit
---------------------------------------------------------------
James W. Giddens, as trustee for the liquidation of the business
of Lehman Brothers Inc. pursuant to the Securities Investor
Protection Act of 1970, asks the Court to deny in all respects
Newport Global Opportunities Fund L.P.'s request to compel him to
sign an affidavit that Newport's 3,663,125 shares of Amtrol
Holdings Inc. common stock previously held by LBI in segregated,
safekeeping, at the request of Newport, are lost.

David W. Wiltenburg, Esq., at Hughes Hubbard & Reed LLP, in New
York, tells the Court that Newport is one of approximately 300
hedge funds and similar clients of the worldwide Lehman
enterprise, who maintained securities in margin accounts at
Lehman Brothers International (Europe) rather than LBI; and yet
Newport asserts to be a "customer" of LBI under SIPA, asserting
that its maintenance of accounts with LBIE rather than LBI is of
no consequence under SIPA, a legal argument that may come before
the Court in due course.

Evidence suggests that Newport and its management are aware that
the Amtrol Shares are not lost and are also aware that their
characterizations of their dealings with LBI as set forth in the
request and supporting declaration are not accurate, Mr.
Wiltenburg asserts.

In another filing, Mr. Giddens sought and obtained the Court's
authority to file the unredacted exhibits to his objection under
seal.  He asserted that the exhibits contain highly sensitive
confidential and commercial information relating to Newport's
assets, its purported claims in the LBI proceeding and his
resolution of claims related to those assets.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers has been a leader in the global
financial markets by serving the financial needs of corporations,
governmental units, institutional clients and individuals
worldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555).  Lehman's bankruptcy petition
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.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

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: Ruld, Ex-Execs. Seek Dismissal of Retirees Suit
----------------------------------------------------------------
Richard Fuld and other former directors of Lehman Brothers
Holdings Inc. have sought for the dismissal of a lawsuit that
seeks to hold them liable for investing workers' retirement
savings in the investment bank's stock, according to a
January 21, 2011 report by The Wall Street Journal.

In court papers, the directors said the board's appointment of a
committee to oversee the employee-retirement programs does not
make them responsible for the committee's choices or require them
to share insider knowledge of the company's finances.  They
argued that they "had no legal duty to disclose non-public
business information to the benefit committee," the Journal
reported.

The directors also said the employees failed to cite any facts
showing that the independent directors were aware of Repo 105's
use, according to the report.

An attorney for the Lehman employees, Mark Rifkin, Esq., at Wolf
Haldenstein Adler Freeman & Herz LLP, in New York, said they
disagree that the directors had no duty to inform Lehman's senior
executives on the benefits committee, the Journal reported.

"That argument is merely an attempt by the director-defendants to
shift responsibility to others for the huge losses suffered by
plan participants," Mr. Rifkin said.

The former Lehman employees filed the lawsuit alleging that the
directors invested their retirement savings in stock at the same
time the company was using the repo transactions to cover up its
financial condition.  They claimed that the senior Lehman
officials knew about the repo transactions and should have made
the retirement-plan fiduciaries aware of the risk created by
those deals.

The employees said those responsible for the retirement plan
should have known the transactions rendered Lehman's financial
statements "materially inaccurate" and should have advised the
plan of the risk.

                       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.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

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)


MAJESTIC STAR: Plan Confirmation Hearing Set for March 3
--------------------------------------------------------
As reported in the Troubled Company Reporter on January 18, 2011,
Majestic Star Casino LLC received approval of the disclosure
statement explaining its proposed Chapter 11 plan.

The voting deadline will be on March 3, 2011, at 4:00 p.m.  The
Debtors may extend the voting deadline in their sole discretion
without further of the Court.

The confirmation hearing is scheduled for March 10, 2011, at 2:30
p.m.  Objections to confirmation of the Plan must be filed with
the Court no later than 4:00 p.m. on March 1, 2011.

                       The Chapter 11 Plan

As reported in the Jan. 18, 2011 edition of the Troubled Company
Reporter, according to Bill Rochelle, the bankruptcy columnist for
Bloomberg News, the Plan, revised again on Jan. 6, offers senior
secured credit facility lenders, owed $65.3 million, full payment
by receiving some cash and rolling over remaining debt.  If new
financing is available, the existing facility will be paid in
cash.  Holders of $348.4 million in senior secured notes are in
line for a 52% recovery from 58% of the new equity and $100.6
million in cash.  If new financing isn't available, noteholders
will receive new debt instead of cash.  Holders of the senior
notes are to be given 42% of the new equity for their
approximately $233 million in debt, resulting in a 25% recovery.
General unsecured creditors are being offered 25% in cash or a
share in $1 million, whichever is less.  Holders of $72.6 million
in discount notes are to receive nothing.

According to the Disclosure Statement, under the Plan, the Debtors
will retain and reorganize around their casino gaming properties
in Gary, Indiana, Tunica County, Mississippi, and Black Hawk,
Colorado, subject, in the case of the Black Hawk, Colorado gaming
property, to obtaining all governmental licenses, suitability
determinations, and other approvals required for such property on
or prior to 240 days following the Confirmation Date.

                         About Majestic Star

The Majestic Star Casino, LLC -- aka Majestic Star Casino, aka
Majestic Star -- is based in Las Vegas, Nev., and is a wholly
owned subsidiary of Majestic Holdco, LLC, which is a wholly owned
subsidiary of Barden Development, Inc.  The Company was formed on
December 8, 1993, as an Indiana limited liability company to
provide gaming and related entertainment to the public.  The
Company commenced gaming operations in the City of Gary at
Buffington Harbor, located in Lake County, Inc., on June 7, 1996.
The Company is a multi-jurisdictional gaming company with
operations in three states -- Indiana, Mississippi and Colorado.

The Company sought Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 09-14136) on November 23, 2009.  The Company's
affiliates -- The Majestic Star Casino II, Inc., The Majestic Star
Casino Capital Corp., Majestic Star Casino Capital Corp. II,
Barden Mississippi Gaming, LLC, Barden Colorado Gaming, LLC,
Majestic Holdco, LLC, and Majestic Star Holdco, Inc. -- filed
separate Chapter 11 petitions.

The Majestic Star Casino's balance sheet at June 30, 2009,
showed total assets of $406.42 million and total liabilities of
$749.55 million.

Kirkland & Ellis LLP is the Debtors' bankruptcy counsel.  James E.
O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns,
Esq., at Pachulski Stang Ziehl & Jones LLP, are the Debtors'
Delaware counsel.  Xroads Solutions Group, LLC, is the Debtors'
financial advisor, while EPIQ Bankruptcy Solutions LLC serves as
the Debtors' claims and notice agent.


MAXUM PETROLEUM: S&P Puts 'B-' Rating on Proposed $250MM Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' issue-level
rating to Maxum Petroleum Operating Co.'s proposed $250 million
senior unsecured notes due 2019, based on preliminary terms and
conditions.  The recovery rating on this debt is '5', indicating
S&P's expectation of modest (10% to 30%) recovery in the event of
a payment default.

S&P expects the Company to use proceeds to repay outstanding debt,
including about $150 million outstanding under it credit facility,
and for general purposes, including potential acquisitions.

The rating on Maxum Petroleum Operating Co. (B/Stable/--) reflects
the Company's thin margins, highly fragmented market, improving
economic activity levels, and significant working capital needs.
The rating on Maxum also reflects the Company's leading market
position, low maintenance-capital expenditure needs, and adequate
liquidity.

Ratings List
Maxum Petroleum Operating Co.
Corporate credit rating                        B/Stable/--

New Ratings
$250 million senior unsecured notes due 2019   B-
  Recovery rating                               5


METROPOLIS SHEETMETAL: Case Summary & Creditors List
----------------------------------------------------
Debtor: Metropolis Sheetmetal Contractors, Inc.
        56 Eads Street
        West Babylon, NY 11704

Bankruptcy Case No.: 11-70252

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       Eastern District of New York (Central Islip)

Judge: Robert E. Grossman

Debtor's Counsel: Salvatore LaMonica, Esq.
                  LAMONICA HERBST AND MANISCALCO
                  3305 Jerusalem Avenue
                  Wantagh, NY 11793
                  Tel: (516) 826-6500
                  Fax: (516) 826-0222
                  E-mail: sl@lhmlawfirm.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/nyeb11-70252.pdf

The petition was signed by Michael Luca, president.


MGM RESORTS: CityCenter Issues $1.5-Bil. of Sr. Secured Notes
-------------------------------------------------------------
CityCenter Holdings, LLC, announced that it has issued $900
million aggregate principal amount of its 7.625% senior secured
first lien notes due 2016 and $600 million aggregate principal
amount of its 10.75% senior secured second lien PIK toggle notes
due 2017.  The interest rate on the senior secured second lien
notes increases by 0.75% if CityCenter elects to pay interest in
the form of additional debt.  The Company also received
approximately $77 million in aggregate equity contributions from
its owners, MGM Resorts International and Infinity World
Development Corp.

The net proceeds from the offering and the contributed equity were
used to reduce the outstanding principal balance of the Company's
senior secured credit facilities from approximately $1.85 billion
to $500 million, to establish an interest escrow for the Company's
first lien notes and remaining senior credit facilities balance
for approximately 18 months, and to pay fees and expenses
associated with the transactions.  Concurrently with the
consummation of the offering, the Company's senior secured credit
facilities were amended and restated, and the remaining $500
million balance was extended to January 21, 2015.

MGM Resorts International Chairman and Chief Executive Officer
James J. Murren, who also serves as the Chairman of the Company's
Board of Directors, said: "The success of this financing puts
CityCenter on solid long term financial footing, and allows
CityCenter the opportunity to continue to grow its brand
awareness, market share, and cash flows."

William Grounds, President and Chief Operating Officer of Infinity
World Development Corp said: "We are very pleased with the strong
support shown by the investment community for this financing.  It
is particularly gratifying that CityCenter was able to upsize the
first lien notes from $500 million to $900 million, which affirms
Infinity World's belief in the strong long-term potential of
CityCenter."
CityCenter's President and Chief Executive Officer, Bobby Baldwin,
said: "The ARIA Hotel and Casino, along with the other components
of CityCenter, continue to build momentum and are benefitting from
the completion of construction in their vicinity."

                         About CityCenter

CityCenter is an urban mixed-use development on the Las Vegas
Strip that includes ARIA Resort & Casino, a 4,004-room casino
resort; Mandarin Oriental Las Vegas, a 392-room non-gaming
boutique hotel with 225 luxury condominium residences; Crystals, a
retail dining and entertainment district; Vdara Hotel and Spa, a
1,495-room luxury hotel-condominium; and the Veer Towers, which
contain 669 luxury condominium residences. CityCenter opened in
December 2009.

CityCenter Holdings, LLC is a 50/50 joint venture of MGM Resorts
International and Infinity World Development Corp (a wholly owned
subsidiary of Dubai World).

                         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.


MILLENNIUM MULTIPLE: Court Extends Claims Bar Date to February 14
-----------------------------------------------------------------
Upon the motion of the Official Committee of Unsecured Creditors
of Millennium Multiple Employer Welfare Benefit Plan, the U.S.
Bankruptcy Court for the Western District of Oklahoma extended the
deadline for the filing of proofs of claim and interest in the
Debtor's Chapter 11 case to 4:30 p.m. on February 14, 2011.

Proofs of claim and interest must be filed before the bar date
with the Clerk of the United States Bankruptcy Court for the
Western District of Oklahoma, 215 Dean A. McGee Avenue, Oklahoma
City, Oklahoma 73102.

                    About Millennium Multiple

Richardson, Texas-based Millennium Multiple Employer Welfare
Benefit Plan filed for Chapter 11 bankruptcy protection on June 9,
2010 (Bankr. W.D. Okla. Case No. 10-13528).  G. Blaine Schwabe,
III, Esq., at Mock Schwabe Waldo Elder Reeves & Bryant, assists
the Company in its restructuring effort.  Eric D. Madden, Esq.,
and Brandon V. Lewis, Esq., at Diamond McCarthy LLP, in Dallas;
and Kyung S. Lee, Esq., at Diamond McCarthy LLP, in Houston, serve
as counsel to the Official Committee of Unsecured Creditors.  The
Company estimated its assets and debts at $50,000,001 to
$100,000,000 as of the petition date.


MILLENNIUM TRANSIT: Plan Outline OK'd; Feb. 4 Confirm. Hearing Set
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Mexico has
approved the disclosure statement explaining Millennium Transit
Services, LLC's proposed Chapter 11 Plan of Reorganization.
Ballots are due on February 4, 2011.

The Court set a confirmation hearing for February 4, 2011, at 1:30
p.m.  Objections to confirmation must be filed no later than
February 4, 2011.

The Debtor believes the Plan is feasible because all unsecured
creditors will be paid on the Initial Distribution Date from new
funds to be loaned to the Debtor from James Ludvik.  Although the
Debtor hopes that emerging from bankruptcy will allow the Debtor
to sell new buses, there is currently no plan to immediately
restart the manufacturing plant.

                        The Chapter 11 Plan

The Debtor estimates secured claims (including the unsecured
portion of undersecured claims) of $41,000,000, priority tax
claims of $0, and general unsecured claims of $6,218,157.

All classes are Impaired Under the Plan.

The Plan proposes the following treatment for the various claims
and interests in the Debtor:

Class 1. Secured Claim of Pioneer Bank.  The Class 1 Claim will be
        paid in accordance with the pre-petition loan documents,
        without modification.  The first payment will be made on
        the Initial Payment Date, and subsequent payments will be
        made monthly.

Class 2. Pre-Petition Secured Claim of James A. Ludvik.  The
        Class 2 Claim will be paid as funds permit after payment
        of other creditor claims.

Class 3. Other Secured Claims.  Allowed Class 3 Claims will be
        paid in the full amount of the Allowed Secured Claim in
        equal payments of principal and interest made over 5 years
        from the Effective Date of the Plan, with interest.  The
        first payment will be made on the Initial Payment Date,
        and subsequent payments will be made monthly.  There are
        no known creditors in this class.

Class 4. Post-Petition Secured Claim of James A. Ludvik.  The
        Class 4 Claim will be paid as funds permit after payment
        of other creditor claims.

Class 5. Priority Claims.  There are no known creditors in this
        class.  The Debtor will make equal installments of
        principal and interest, to the Holders of all Allowed
        Class 5 Claims so that Class 5 Claims are paid in full
        within five years after the Effective Date of the Plan,
        with Interest.

Class 6. General Unsecured Non-Priority Claims. Class 6 consists
        of all allowed Unsecured Non-Priority Claims, other than
        Class 7 and Class 8 claims, including but not limited to
        claims arising from rejection of executory contracts and
        unexpired leases and unsecured deficiency claims.  The
        Allowed Class 6 claimants will be paid by Debtor from an
        unsecured creditors' fund in the amount of $150,000 which
        will be set up by Debtor at confirmation of the plan.  The
        Debtor will disburse the funds in the account within 10
        days after all unsecured claims have been finally allowed
        or disallowed.  The Allowed Class 6 claims will be paid
        on a pro-rata basis.

Class 7. Post-Petition Liabilities.  The Class 7 claims, including
        any administrative claims not approved by the Court, will
        not be paid under the Plan.

Class 8. Equity.  The equity owners will retain ownership of their
        stock in the Debtor.

A copy of the disclosure statement describing the Debtor's
Chapter 11 Plan is available at:

        http://bankrupt.com/misc/MillenniumTransit.DS.pdf

                     About Millennium Transit

Roswel, New Mexico-based Millennium Transit Services LLC is a New
Mexico limited liability company organized for the purpose of
operating a bus manufacturing facility in Roswell, New Mexico.
The Company filed for Chapter 11 relief on August 29, 2008 (Bankr.
D. N.M. Case No. 08-12848).  Currently, MTS is managed by
Millennium Transit LLC, which is owned by James Ludvik.  David T.
Thuma, Esq., at Jacobvitz, Thuma & Walker, represents the Debtor
as counsel.  George M. Moore, Esq., at Moore, Berkson &
Gandarilla, P.C., represents the official committee of unsecured
creditors.  The Debtor estimated $10 million to
$50 million in assets and debts in its Chapter 11 petition.

MTS is not currently building buses due to a lack of demand for
its products and issues with obtaining working capital or
investment capital to fund a re-start of the manufacturing
process.


MILLENNIUM MULTIPLE: U.S. Trustee Names 3 Add'l Committee Members
-----------------------------------------------------------------
On January 2011, Richard A. Wieland, the U.S. Trustee for
Region 20, appointed three additional unsecured creditors to the
Official Unsecured Creditors' Committee in Millennium Multiple
Employer Welfare Benefit Plan's Chapter 11 case now pending in the
U.S. Bankruptcy Court for the Western District of Oklahoma.

The three additional Committee members are Legal Reprographics,
Inc., T. Matera & Associates, Inc., and Hugh M. Cunningham, Inc.

The Creditors Committee is now composed of:

1. Various Participants
   Representative: John Malesovas
   816 Congress Avenue, Suite 1265
   Austin, TX 78701
   Tel: (512) 708-1777

2. Various Participants
   Representative: Kathryn E. Barnett
   1650 One Nashville Place
   150 Fourth Avenue North
   Nashville, TN 37219
   Tel: (615) 313-9000

3. Vivek Khetpal
   Representative: Vivek Khetpal
   1275 Mockingbird Lane
   Durant, OK 74701
   Tel: (580) 931-0500

4. Juli Jessen
   Representative: Christina Economou
   370 South Main Street
   Yuma, AZ 85364
   Tel: (928) 819-1576

5. Jeffrey Epstein
   Representative: Jeffrey Epstein
   1015 Redcedar Lane
   Houston, TX 77094
   Tel: (281) 556-8495

6. Shahe E. Vartivarian
   Representative: Salpi Vartivarian
   7777 Southwest Freeway, Suite 610
   Houston, TX 77074
   Tel: (713) 339-9949

7. Lester Lewis
   Representative: Lester Lewis
   9821 Spring Hill Drive
   Anchorage, AK 99507
   Tel: 907-346-3869

8. Legal Reprographics, Inc.
   Representative: Steven Beaver
   13151 Stone Canyon Road
   Poway, CA 92064-2175

9. T. Matera & Associates, Inc.
   Representative: Tom Matera
   1518 Herbert Street
   Downers Grove, IL 60515

10. Hugh M. Cunningham, Inc.
   Representative: Dan Townsend
   13755 Benchmark Drive
   Dallas, TX 75234

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtor's
expense.  They may investigate the Debtor's business and financial
affairs.  Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.  Those
committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

                    About Millennium Multiple

Richardson, Texas-based Millennium Multiple Employer Welfare
Benefit Plan filed for Chapter 11 bankruptcy protection on June 9,
2010 (Bankr. W.D. Okla. Case No. 10-13528).  G. Blaine Schwabe,
III, Esq., at Mock Schwabe Waldo Elder Reeves & Bryant, assists
the Company in its restructuring effort.  Eric D. Madden, Esq.,
and Brandon V. Lewis, Esq., at Diamond McCarthy LLP, in Dallas;
and Kyung S. Lee, Esq., at Diamond McCarthy LLP, in Houston, serve
as counsel to the Official Committee of Unsecured Creditors.  The
Company estimated its assets and debts at $50,000,001 to
$100,000,000 as of the petition date.


MOONLIGHT BASIN: Hearing on Office Building Sale Moved to Feb. 14
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Montana has
continued to Monday, February 14, 2011, at 9:00 a.m., the hearing
on Moonlight Basin Ranch LP's motion to sell designated property
outside the ordinary course of business and to use the cash
collateral resulting from the sale.

The motion, which was filed November 17, seeks the sale of the
Debtor's office building (Lots 6 and 7 of the Ennis Hot Springs
Subdivision in Madison County, Montana), to Highway 287 Office LLC
for $244,000 in cash.  The Debtor will retain an option to
repurchase the property for a cash price of $264,252 exercisable
on or before October 1, 2011.  The Debtor will retain possession,
without payment of rent, during the repurchase period.

The amount of the cash proceeds, combined with the proceeds of
sale of other Designated Properties will not exceed $1,127,500.

Lehman Commercial Paper, Inc., who holds a security interest and
mortgage interest in, and lien on, all or substantially all of the
Debtor's assets including the Office Building Property subject of
this motion, has agreed to release the sale proceeds of the
Designated Properties for specified purposes described in the
debtor in possession financing Final Order.

This sale is proposed in accordance with the "Designated
Properties" provisions of the Final Order and the Senior Secured
Super-Priority Debtor-in-Possession Credit Agreement.

                      About Moonlight Basin

Ennis, Montana-based Moonlight Basin Ranch LP is a golf and ski
resort in Montana.  The Company filed for Chapter 11 bankruptcy
protection on November 18, 2009 (Bankr. D. Mont. Case No.
09-62327).  Craig D. Martinson, Esq., and James A. Patten, Esq.,
who have offices in Billings, Montana, assist the Debtor in its
restructuring effort.  In its amended schedules, the Debtor
disclosed $45,519,089 in assets and $97,407,467 in liabilities as
of the petition date.

Debtor-affiliate Moonlight Lodge, LLC, also filed a separate
Chapter 11 petition (Bankr. D. Mont. Case No. 09-62329) on
November 18, 2009.  The Company estimated $10 million to
$50 million in assets and $50 million to $100 million in debts in
its Chapter 11 petition.


MORTGAGE LENDERS: Liquidating Trustee Wants Loan Docs. Destroyed
----------------------------------------------------------------
Reuters and Bloomberg News report that federal bankruptcy judges
in Delaware were due to hold separate hearings Monday on requests
by trustees liquidating Mortgage Lenders Network USA and American
Home Mortgage to destroy thousands of boxes or original loan
documents.

Scot J. Paltrow, writing for Reuters, reports that:

     -- Neil Luria, the liquidating trustee for Mortgage Lenders,
        sought Judge Peter Walsh's permission to destroy nearly
        18,000 boxes of records now warehoused by document storage
        company, Iron Mountain Inc.  According to Reuters, Mr.
        Luria said destruction is necessary to eliminate $16,000
        per month in storage costs as he disposes of the last
        assets of the bankrupt company.

     -- Steven Sass, the liquidating trustee for American Home
        Mortgage, sought Judge Christopher Sontchi's permission to
        approve destruction of 4,100 boxes of loan documents
        stored in a dank parking garage beneath the company's
        former headquarters in Melville, Long Island.  Mr. Sass
        stated that the local fire marshal wants the documents
        removed as a fire hazard, and he said the cost of moving
        them would be prohibitive.  In accordance with a 2009
        court order, the bankrupt company earlier had destroyed
        the contents of thousands of other boxes after banks and
        other loan servicers had been given a chance to request
        and pick up particular files.

Reuters says the requests come despite intense concerns that
paperwork critical to foreclosures and securitized investments may
be lost.

Phil Milford and Dawn McCarty, writing for Bloomberg News, report
that the U.S. government objected to Mortgage Lenders' request.
According to Bloomberg, Delaware U.S. Attorney Charles M. Oberly
III argues that Mortgage Lenders' plan "threatens to impair
federal law enforcement efforts."  Mr. Oberly III also told the
judge the company's records "may be relevant to pending federal
criminal investigations into mortgage fraud."

Bloomberg further relates that Mr. Oberly proposed, as an
alternative, to require Mr. Luria to provide government officials
"with notice of the specific documents proposed to be destroyed"
and "an opportunity to respond."

According to Reuters, people involved with the cases said the
overlapping timing of the two hearings Monday is coincidental.

                        About American Home

Based in Melville, New York, American Home Mortgage Investment
Corp. (NYSE: AHM) -- http://www.americanhm.com/-- was a mortgage
real estate investment trust engaged in the business of investing
in mortgage-backed securities and mortgage loans resulting from
the securitization of residential mortgage loans originated and
serviced by its subsidiaries.

American Home Mortgage and seven affiliates filed for Chapter 11
protection on August 6, 2007 (Bankr. D. Del. Case Nos. 07-11047
through 07-11054).  James L. Patton, Jr., Esq., Joel A. Waite,
Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt &
Taylor LLP represent the Debtors.  Epiq Bankruptcy Solutions LLC
acts as the Debtors' claims and noticing agent.  The Official
Committee of Unsecured Creditors selected Hahn & Hessen LLP as
its counsel.  As of March 31, 2007, American Home Mortgage's
balance sheet showed total assets of $20,553,935,000, total
liabilities of $19,330,191,000.

American Home filed a de-consolidated plan of liquidation on
August 15, 2008.  The former home mortgage lender's liquidating
Chapter 11 plan was confirmed in February 2009.

                      About Mortgage Lenders

Middletown, Connecticut-based Mortgage Lenders Network USA Inc. --
http://www.mlnusa.com/-- was once the 15th largest mortgage
lender in the United States.  The Company filed for Chapter 11
protection on February 5, 2007 (Bankr. D. Del. Case No. 07-10146).
Pachulski Stang Ziehl & Jones LLP represents the Debtor.  Blank
Rome LLP represents the Official Committee of Unsecured Creditors.
In the Debtor's schedules of assets and liabilities filed with the
Court, it disclosed total assets of $464,847,213 and total debts
of $556,459,464.

The Honorable Peter J. Walsh approved the Company's liquidating
Chapter 11 plan in February 2009.  A full-text copy of the
Debtor's First Amended Liquidating Plan under Chapter 11 of the
Bankruptcy Code, dated December 19, 2008, is available at
http://is.gd/1a3YGat no charge.


MOSDOS CHEFETZ: Filed for Chapter 11 to Hold Off State Suit
-----------------------------------------------------------
Steve Lieberman at The Journal News reports that Mosdos Chofetz
Chaim Inc., a Ramapo New York-based yeshiva that is building
adult-student housing on Grandview Avenue, filed for Chapter 11
bankruptcy protection, to prevent a state judge from holding an
investigatory hearing into whether the yeshiva illegally housed
families in 17 apartments beyond his approval at the site just
outside New Hempstead.

The Journal News reports that a supreme court justice held the
hearing anyway in the Rockland County Courthouse in New City and
plans on hearing testimony and accepting evidence on Jan. 31,
2011.  The congregation's leader, Rabbi Aryeh Zaks, was subpoenaed
to testify but didn't show up at the Jan. 19 hearing.  Mr. Zakz is
expected at the next hearing date.

Mosdos Chefetz Chaim Inc., filed a Chapter 11 petition (Bankr.
S.D.N.Y. Case No. 11-22062) on Jan. 18, 2011, in White Plains, New
York.  Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand
Greene Genovese & Gluck, P.C., in New York, represents the Debtor.
In its schedules, the Debtor disclosed assets of $4,530,000 and
debts of $16,412,113.  Mr. Zaks signed the Chapter 11 petition.


NAMCO CAPITAL: Chapter 11 Trustee Sues Ezri Namvar Family
---------------------------------------------------------
Adam Popescu at the Beverly Hills Courier reports that Bradley D.
Sharp, the chapter 11 trustee of Namco Capital Group, filed a new
lawsuit against alleged ponzi-schemer Ezri Namvar's children,
sisters, brothers and their wives for money that they allegedly
took out of the Company and used to fund real estate development
ventures, stock purchases, and a $200,000 wedding party for Ezri
Namvar's brother Ramin Namvar.

The report relates that According to the 40-page suit, the trustee
claimed the Namvars "would pick a property and have Namco provide
equity funding, without any security or any written agreement
beyond a journal entry.  Then they would form one or more LLCs to
hold title and would distribute LLC ownership interests directly
and indirectly to various combinations of Namvar family members,"
without the family members adding any equity to the deal.

The lawsuit, according to the report, alleges that because there
was no written agreement with Namco, the Namvar brothers exercised
broad flexibility to manage the funds however they saw fit.
Hundreds of LLCs were created in this way.

Ezri Namvar, Chairman, CEO, is founder and principal shareholder
of Namco Capital Group, Inc., a privately held holding company for
companies engaged in real estate investments and financial
services.  Creditors with $7.7 million in claims filed involuntary
Chapter 11 petitions on December 22, 2008, against Mr. Namvar and
Namco Capital (Bankr. C.D. Calif. Case No. 08-32349, and 08-
32333).

Mr. Popescu notes Mr. Namvar pleaded not guilty on Oct. 4, 2010,
to charges that he was involved in a scheme to shift
$23 million in client funds to pay off creditors of another
bankrupt company he controlled.  Mr. Namvar will face trial on
May 3, 2011, at the U.S. District Court in downtown Los Angeles.


NEOMEDIA TECHNOLOGIES: JMC Holds 23.63% Equity Stake
----------------------------------------------------
In an amended Schedule 13D filing with the Securities and Exchange
Commission on January 21, 2011, each of JMC Holdings, L.P. and
Michael J. Cline disclosed beneficial ownership of 11,032,736
shares of common stock of NeoMedia Technologies, Inc.,
representing 23.63% of the shares outstanding, based on 35,660,877
shares of Common Stock outstanding as of January 18, 2011.

JMC and Mr. Cline own 1,446,916 shares of Common Stock and 265
shares of Series C Convertible Preferred Stock, par value $0.01
per share, which is convertible into Common Stock at the request
of the holder pursuant to the Certificate of Designation of the
Preferred Stock.

The Certificate of Designation provides that each share of the
Preferred Stock is convertible into Common Stock of the Company
equal to the quotient of the liquidation amount divided by the
conversion price.  The liquidation amount is equal to $1,000 per
share of Preferred Stock.  The conversion price is equal to, at
the option of the holder, the lesser of (i) $0.50 or (ii) 97% of
the lowest closing bid price of the Common Stock for the 125
trading days immediately preceding the date of conversion, as
quoted by Bloomberg LP.

The Certificate of Designation further provides that no holder
of the Preferred Stock shall be entitled to convert the
Preferred Stock to the extent that such conversion would cause the
aggregate number of shares of Common Stock beneficially owned by
such holder to exceed 9.99% of the outstanding shares of Common
Stock following such conversion.

Assuming a conversion price of $0.027645, if the Preferred Stock
were to be converted as of the date hereof, the Reporting Persons
would own 11,032,736 shares of Common Stock in the aggregate of
the Issuer which would represent approximately 23.63% of the total
shares of Common Stock outstanding at such time.  However, the
Certificate of Designation prohibits the Reporting Persons from
converting the Preferred Stock to the extent such conversion would
result in the Reporting Persons beneficially owning in excess of
9.99% of the then issued and outstanding shares of Common Stock.

The Preferred Stock has voting rights on an as converted basis
together with the Common Stock shareholders and as otherwise
provided under the laws of the State of Delaware.  Mr. Cline, as
the General Partner of JMC, has the sole voting and dispositive
power with respect to the Preferred Stock reported pursuant to
this Schedule 13D.

                    About NeoMedia Technologies

Atlanta, Ga.-based NeoMedia Technologies, Inc., provides mobile
barcode scanning solutions.  The Company's technology allows
mobile devices with cameras to read 1D and 2D barcodes and provide
"one click" access to mobile content.

The Company's balance sheet at September 30, 2010, showed
$9.04 million in total assets, $83.31 million in total
liabilities, $8.37 million in Series C convertible preferred
stock, $2.50 million in Series D convertible preferred stock, and
a stockholders' deficit of $85.14 million.

At September 30, 2010, the Company has an accumulated deficit of
$237.99 million.  The Company also has a working capital deficit
of $82.05 million, of which of which $68.51 million is related to
the Company's financing instruments, including $30.71 million
related to the fair value of warrants and those debentures that
are recorded as hybrid financial instruments, and $37.80 million
related to the amortized cost carrying value of certain of the
Company's debentures and the fair value of the associated
derivative liabilities.

As reported in the Troubled Company Reporter on April 1, 2010,
Kingery & Crous, P.A., in Tampa, Fla., expressed substantial
doubt about the Company's ability to continue as a going concern
following the Company's 2009 results.  The independent auditors
noted that the Company has suffered recurring losses from
operations and has ongoing requirements for additional capital
investment.


NEVADA STAR: Hearing on Madison Plan Outline Continued to March 2
-----------------------------------------------------------------
Judge Peter Carroll of the U.S. Bankruptcy Court for the Central
District of California will convene another hearing on March 2 to
consider approval of the disclosure statement for explaining the
plan of liquidation for Nevada Star, LLC, and Claudia Raffone, as
proposed by creditor Madison Realty Capital, L.P.

Following a hearing on Dec. 15, 2010, Judge Carroll approved in
part and denied in part the disclosure statement explaining the
plan proposed by Madison.  Madison was required to submit an
amended plan and disclosure statement this month.  A hearing on
the amended disclosure statement was scheduled for Feb. 16.

As reported in the Nov. 19, 2010 edition of the Troubled Company
Reporter, Madison, holder of a first priority security interest in
and lien upon the Debtor's multi-unit dwelling facility in New
York, filed a plan that seeks to accomplish payments to creditors
by selling Nevada Star's property and paying creditors with the
proceeds of the sale.  If necessary, the Plan provides for the
sale of Ms. Raffone's property and paying her creditors (some of
which overlap with the claims asserted against Nevada Star).
Nevada Star's principal asset is a 49 unit apartment building,
located at 114 West 86th Street in New York City, and all fixtures
and incidental personal property that is used for the operations
and maintenance of the building.  Ms. Raffone's principal assets
are two single family residences located in Beverly Hills,
California and Florida.  Under the Plan, all secured claims will
be paid in full.  Unsecured creditors will be paid from remaining
cash after administrative claims and secured claims are paid in
full.

The Debtors, along with creditors Fox Rothschild LLP, Casey Ciklin
Lubitz Martens & O'Connell, Henry Douglas Campbell, the IRS
objected to the Disclosure Statement.

                 Feb. 16 Hearing Moved to March 2

The Court has approved a stipulation filed by the Debtors,
Madison, the Official Committee of Unsecured Creditors and Henry
Douglas Campbell, in addition to other creditors holding allowed
claims, seeking a continuance of the Chapter 11 status conference
hearing and the hearing on the first amended disclosure statement
set by the Court on February 16, 2011 to March 2, 2011, at 9:30
a.m.

The stipulation provides that Madison will file the first amended
disclosure statement by January 28, 2011.

Madison Realty is represented by:

     BRYAN CAVE LLP
     Katherine M. Windler, Esq.
     120 Broadway, Suite 300
     Santa Monica, California 90401-2386
     Telephone: (310) 576-2100
     Facsimile: (310) 576-2200
     E-mail: katherine.windler@bryancave.com

                        About Nevada Star

Beverly Hills, California-based Nevada Star, LLC, filed for
Chapter 11 protection on April 26, 2010 (Bankr. C.D. Calif. Case
No. 10-26188).  Michael Jay Berger, Esq., who has an
office in Beverly Hills, California, represents the Debtor.  The
Company disclosed $22,274,634 in assets and $12,191,750 in
liabilities as of the Petition Date.


NEW JERSEY: Christie Bankruptcy Remark Amid Bond Sale Criticized
----------------------------------------------------------------
Brendan A. McGrail at Bloomberg News reports that New Jersey
Governor Chris Christie's comments that rising health-care costs
might "bankrupt" the state, made the same day of a planned bond
sale, drew criticism for poor timing and may have driven up
borrowing costs.

The Troubled Company Reporter first ran a story on the
"bankruptcy" remark on January 14.

About 20 minutes after Gov. Christie, 48, made the bankruptcy
reference in a town-hall meeting in Paramus January 13, the New
Jersey Economic Development Authority cut its tax-exempt school
bond offering by almost half to $777.5 million and its taxable
offering 50% to $123.2 million.

"He is scaring some people when he says the state is going
bankrupt," said Gary Pollack, head of bond trading at Deutsche
Bank Private Wealth Management in New York.

Gov. Christie, a first-term Republican, said health-care spending
"will bankrupt" the state unless it requires its workers to pay
more for medical coverage.  New Jersey will spend $4.3 billion on
employee and retiree health insurance this year, and that cost
will rise 40% within four years, he said.


NMH HOLDINGS: S&P Raises Corporate Rating to 'B', Outlook Stable
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Boston, Mass.-based NMH Holdings LLC (doing business as
National Mentor Holdings Inc.) to 'B' from 'B-'.  The rating
outlook is stable.

In addition, S&P assigned National Mentor Holding Inc's proposed
$75 million senior secured revolving credit facility due in 2016
and $505 million term loan due in 2017 S&P's 'B+' issue-level
rating (one notch higher than the 'B' corporate credit rating on
the Company).  S&P also assigned this debt a recovery rating of
'2', indicating S&P's expectation of substantial (70%-90%)
recovery for lenders in the event of a payment default.

At the same time, S&P assigned the Company's $275 million notes
due 2018 a rating of 'CCC+' (two notches lower than the 'B'
corporate credit rating) with a recovery rating of '6', indicating
S&P's expectation of negligible (0%-10%) recovery for noteholders
in the event of a payment default.

The rating upgrade reflects the elimination of near-term maturity
risk, including the approaching applicable high-yield discount
obligation payment requirement.  The 'B' rating reflects the
Company's significant exposure to reimbursement risk, fairly thin
operating margins, and limited ability to reduce financial
leverage through debt reduction given its emphasis on
acquisitions.


NORTEL NETWORKS: Purchase Price to Be Set by Judge, Not Arbitrator
------------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that in the liquidation of Nortel Networks Inc., the
bankruptcy judge, not an arbitrator, will determine a disputed
price adjustment following the sale of the Internet telephony
business to Genband Inc.  When the bankruptcy judge in Delaware
approved the sale in March 2010, Nortel advertised the price as
generating $182 million after adjustments.

Mr. Rochelle relates that the dispute centers on a price
adjustment related to an interpretation of the phrase "services to
be performed or products to be provided" after the closing date.
If Genband is correct in its interpretation, the final price would
be $142.9 million. If Nortel is right, it's $182 million.

According to Mr. Rochelle, U.S. Bankruptcy Judge Kevin Gross wrote
an opinion on Jan. 21 concluding that an arbitration provision in
the purchase contract doesn't apply.  He said arbitration applies
only to accounting disputes.  Since the dispute is only over the
interpretation of the contract, Judge Gross ruled that he, not the
arbitrator, must decide the final sale price.

A copy of Judge Gross' January 21, 2011 Memorandum Opinion is
available at http://is.gd/Y7CcFGfrom Leagle.com.

                     About Nortel Networks

Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was
once North America's largest communications equipment provider.
It has sold most of the businesses while in bankruptcy.

Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List).  Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.

The Monitor sought recognition of the CCAA Proceedings in the U.S.
by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164).  Mary Caloway,
Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney
PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's
counsel.

Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138).
Judge Kevin Gross presides over the case.  James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel.  The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.  Fred S. Hodara, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, in New York, and
Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represent the Official Committee of
Unsecured Creditors.

Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection.  On May 28, 2009, at the request
of the Administrators, the Commercial Court of Versailles, France
ordered the commencement of secondary proceedings in respect of
Nortel Networks S.A.  On June 8, 2009, Nortel Networks UK Limited
filed petitions in this Court for recognition of the English
Proceedings as foreign main proceedings under chapter 15 of the
Bankruptcy Code.

Nortel Networks divested off key assets while in Chapter 11.
In March 2009, the U.S. Bankruptcy Court entered an order
approving the sale of the Layer 4-7 assets to Radware Ltd. as the
successful bidder at auction.  In July 2009, Nortel sold its CDMA
and LTE-related assets to Telefonaktiebolaget LM Ericsson (Publ).
In September 2009, the Court Nortel sold its Enterprise Solutions
business to Avaya Inc.  In October 2009, the Court approved the
sale of assets associated with Nortel's Next Generation Packet
Core network components to Hitachi, Ltd.  On December 2, 2009, the
Court approved the sale of assets associated with Nortel's
GSM/GSM-R business to Telefonaktiebolaget LM Ericsson (Publ) and
Kapsch Carriercom AG.  In December 2009, the Debtors sold their
Metro Ethernet Networks business to Ciena Corporation.  In March
2010, Nortel sold its Carrier Voice Over IP and Application
Solutions business to GENBAND Inc.  In September 2010, Nortel sold
its Multi-Service Switch business to Ericsson.

Nortel Networks has filed a proposed plan of liquidation in the
U.S. Bankruptcy Court.  The Plan generally provides for full
payment on secured claims with other distributions going in
accordance with the priorities in bankruptcy law.


NYC OFF-TRACK: Chapter 9 Bankruptcy Case Dismissed
--------------------------------------------------
Tiffany Kary at Bloomberg News reports that New York City
Off-Track Betting Corp.'s bankruptcy case was dismissed, ending
the last effort to recover funds for creditors following last
year's shutdown of the operator of horse-racing wagering parlors.

According to the report, U.S. Bankruptcy Judge Martin Glenn said
January 25 the Chapter 9 bankruptcy failed, as there is nothing
left to reorganize.  He dismissed a union's request to appoint a
trustee to recover funds paid out by OTB, which oversaw betting on
races at New York's Aqueduct, Belmont and Saratoga tracks since
1955.

"All day-to-day and wind down operations have ceased, all
employees have been terminated, all cash has been disbursed with
the exception of an account reserved to honor un-cashed checks and
all officers have resigned," Judge Glenn wrote in his ruling.

NYC OTB filed the motion asking the U.S. Bankruptcy Court to
dismiss its Chapter 9 case.  As reported by the Troubled Company
Reporter, NYC OTB began closing down December 7, 2010, after the
state Senate voted down legislation for a bailout to be effected
through a Chapter 9 reorganization plan.

                         Trustee Denied

Bloomberg relates that a union representing 1,027 of about 1,200
former OTB employees sought a trustee to recover "hundreds of
millions" of dollars in transfers made by the Company to the state
and the New York tracks before the bankruptcy filing, arguing the
money should return to the estate for distribution to all
creditors.

Trustees have limited power to undo transfers made in a Chapter 9
debtor's exercise of a political or governmental function, Jude
Glenn said in denying the request, according to the Bloomberg
report.

                           About NYC OTB

New York City Off-Track Betting Corporation is a public benefit
corporation, which operates an off-track pari-mutuel betting
system on thoroughbred and harness horse races held at all 11 race
tracks located in New York State and certain race tracks located
outside of the State.  Since NYC OTB's inception in 1971, it has
made payments of nearly $2 billion to the State horse racing
industry, more than $1.4 billion to New York City and nearly
$600 million to the State.  In 2008 alone, NYC OTB made statutory
contributions in an aggregate amount of $128.6 million to the
State horse racing industry, the State, the City, and other local
municipalities.  NYC OTB's operations are regulated by the State.

NYC OTB filed for bankruptcy under Chapter 9 of the Bankruptcy
Code on December 3, 2009 (Bankr. S.D.N.Y. Case No. 09-17121).  OTB
is represented by Richard Levin, Esq., at Cravath, Swaine & Moore
LLP., in New York, and Michael S. Fox, Esq., Herbert C. Ross,
Esq., David Y. Wolnerman, Esq., at Olshan Grundman Frome
Rosenzweig & Wolosky LLP in New York.

At September 30, 2009, NYC OTB had $18,468,147 in total assets
against $74,912,742 in total current liabilities, $6,982,887 in
long-term liabilities, and $201,020,000 in long-term post
employment benefits.


ODYSSEY PROPERTIES: Golfview Cases' Dismissal Sought by BB&T
------------------------------------------------------------
Creditor Branch Banking And Trust Company asks the U.S. Bankruptcy
Court for the Middle District of Florida to dismiss the Chapter 11
bankruptcy cases of Century (III) DP III, LLC, and Odyssey (III)
DP III, LLC -- the Golfview Debtors -- or convert the cases to
Chapter 7, due to substantial and continuing losses and diminution
of the estates, and the absence of a reasonable likelihood of
rehabilitation.

The Golfview Debtors' Monthly Operating Reports and cash flow
reports show that the Golfview Self Storage project doesn't
generate sufficient income to cover its operating expenses and the
significant accrued yet unpaid bankruptcy administrative expenses,
let alone make debt service payments to its secured lender BB&T.

At a hearing held November 1, 2010, the Court made a finding that
the Golfview Debtors meet the definition of "single asset real
estate".  Since that time, the Golfview Debtors breached their
obligations under the U.S. Bankruptcy Code and have made only one
monthly interest payment.  That single payment, issued on or about
November 17, 2010, was returned when a check bounced due to
insufficient funds, BB&T says.  BB&T states that it didn't receive
the replacement funds until November 30, 2010.  According to BB&T,
the Golfview Debtors didn't make any monthly interest payment in
December 2010 and haven't made any payment for January 2011.

BB&T claims that the costs of reorganization in these cases is
significantly diminishing the value of the estates, and that the
harm is being compounded by the fact that administrative costs
being incurred by the Golfview Debtors are unusually high due to
the multiple levels of administration put in place for the benefit
of Odyssey Properties III, LLC, the parent company.  "The storage
facility is run by the onsite employees, who are paid a salary for
their operation of the Project.  There is also the monthly
management fee paid to a management company owned and controlled
by the owners of the Golfview Debtors.  In addition, the Chief
Restructuring Officer receives a significant fee for assisting the
Jointly Administered Debtors with their bankruptcy filings and
planning.  Finally, in addition to U.S. Trustee fees, the
attorneys for the Jointly Administered Debtors are undoubtedly
incurring their own significant fees. All of these layers of
administrative pockets are to somehow be filled by a Project that
can't even cover its own operating expenses or real estate taxes,"
BB&T states.

According to BB&T, the Golfview Debtors' estates are essentially
being burdened with a "common enterprise tax" that isn't
commensurate with the benefit -- if any -- of being associated
with the other Jointly Administered Debtors.  "Simply put, these
cases are only benefiting the insiders and professionals," BB&T
claims.

BB&T says that the overall value of the Project has continued to
decline in the nearly six months since the petition date.  The
most recent projected budget provided by the Jointly Administered
Debtors' counsel for January 2011 through March 2011 shows that
the Golfview Project will have a negative cash flow of more than
$90,000 during the first quarter of 2011.  The Golfview Debtors'
cash flow report for the week ending December 26, 2010, shows that
Golfview Debtors had a cumulative negative cash flow of $5,870 for
the first five months of the case, even before including attorneys
fees and unpaid CRO fees.

"It appears that the only way the Golfview Debtors have been able
to avoid showing a cumulative negative cash flow on their weekly
cash collateral reports is by ceasing interest payments to BB&T,
curtailing their Legal and Professional payments, and by including
borrowed funds from the DIP Lender in their calculation of 'Net
Cash from Operations'," BB&T states.

BB&T says that the Golfview Debtors' weekly cash flow reports and
the available monthly operating reports show that the income
produced by the Golfview Project insufficient to cover its
operating expenses.  The most recent Monthly Operating Report
shows that the Golfview Debtors had negative cash flow of
$37,382.75 during the first four months of the case.

The Court has set a preliminary hearing for February 7, 2011, at
11:00 a.m. to consider and act upon BB&T's request to have the
Golfview Debtors' bankruptcy cases dismissed.

BB&T is represented by David J. Lienhart, Esq. --
dlienhart@ralaw.com -- and W. Glenn Jensen, Esq. --
gjensen@ralaw.com -- at Roetzel & Andress.

                       Odyssey Properties

Lakeland, Florida-based Odyssey Properties III, LLC, is engaged in
the business of developing, owning, and operating commercial
properties, including anchored and unanchored retail centers,
office buildings, flex and warehouse space, and self-storage
centers, primarily in central Florida.

Odyssey Properties and certain affiliates filed for Chapter 11
protection on August 2, 2010 (Bankr. M.D. Fla. Case No. 10-18713).
Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain &
Prosser, PA, represents the Debtor.  The Debtor estimated its
assets and debts at $10 million to $50 million as of the Petition
Date.


ODYSSEY PROPERTIES: Gets Final Nod to Use Cash Collateral
---------------------------------------------------------
Odyssey Properties III, LLC, et al., obtained final authorization
from the Hon. Catherine Peek McEwen of the U.S. Bankruptcy Court
for the Middle District of Florida to use cash collateral.

Odyssey Properties III owe $29 million to holders of the investor
notes.  The Debtors also have obligations to lenders -- financing
obtained from the Debtors' mortgage lenders, Wells Fargo Bank,
National Association, successor by merger to Wachovia Bank,
National Association, Branch Banking & Trust Company, successor in
interest to Colonial Bank by asset acquisition from the Federal
Deposit Insurance Corporation as Receiver for Colonial Bank
(BB&T), and Flagstar Bank, FSB.  The Lenders and the noteholders
may assert that they have liens on the rents and leases at the
projects and that they therefore have an interest in the Debtors'
cash collateral.

Edward J. Peterson, III, at Stichter Riedel Blain & Prosser, P.A.,
explained that the Debtors need access to the cash collateral to
fund their Chapter 11 case, pay suppliers and other parties.  The
Debtors will use the collateral pursuant to a budget, a copy of
which is available for free at:

http://bankrupt.com/misc/Oddyssey_Properties_cashcoll_budget.pdf

The Debtors will provide cash-basis profit and loss statements on
a weekly basis to the counsel for each of the Lenders and the
counsel to the indenture trustee for the Noteholders by 5:00 p.m.
(EST) on Friday of the following week.

The Lenders and Noteholders are granted as adequate protection
postpetition replacement liens against the Debtors' cash
collateral to the same extent, validity, and priority as existed
as of the Petition Date.

Use of cash collateral will be segregated on a project basis, such
that cash collateral generated by a particular project will only
be used for that specific project.  Any cash received from a
project that is not used pursuant to the terms of the Budget will
remain segregated by the Debtor owning the project pending further
court order.

                       Odyssey Properties

Lakeland, Florida-based Odyssey Properties III, LLC, is engaged in
the business of developing, owning, and operating commercial
properties, including anchored and unanchored retail centers,
office buildings, flex and warehouse space, and self-storage
centers, primarily in central Florida.

Odyssey Properties and certain affiliates filed for Chapter 11
protection on August 2, 2010 (Bankr. M.D. Fla. Case No. 10-18713).
Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain &
Prosser, PA, represents the Debtor.  The Debtor estimated its
assets and debts at $10 million to $50 million as of the Petition
Date.


OTC HOLDINGS: Able to Reduce Interest on Exit Loan
--------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
that Oriental Trading Co. is reducing the interest rate offered
for the $200 million credit needed to finance its emergence from
Chapter 11 reorganization.  The bankruptcy judge in New York
confirmed the Chapter 11 plan on Dec. 16.

According to the report, OTC is now offering 5.5 percentage points
more than the London interbank borrowed rate, rather than
6.5 percentage points as before.  The Libor floor is now 1.5%,
rather than 1.75%.  To increase the yield, the lenders now would
pay 99% of par, rather than 98% of the face amount, according to a
person familiar with the negotiations.

                   About OTC Holdings Corporation

Omaha, Nebraska-based OTC Holdings Corporation filed for
Chapter 11 protection on August 25, 2010 (Bankr. D. Del. Case No.
10-12636).  Affiliates OTC Investors Corporation (Bankr. D. Del.
Case No. 10-12637), Oriental Trading Company, Inc. (Bankr. D. Del.
Case No. 10-12638), Fun Express, Inc. (Bankr. D. Del. Case No.
10-12639), and Oriental Trading Marketing, Inc. (Bankr. D. Del.
Case No. 10-12640), filed separate Chapter 11 petitions on
August 25, 2010.  The Debtors disclosed $463 million in assets and
$757 million in liabilities as of the Chapter 11 filing.

Richard Hahn, Esq., My Chi To, Esq., Jae-Sun Chung, Esq., Huyue
Angela Zhang, Esq., and Jessica Katz, Esq., at Debevoise &
Plimpton LLP, represent the Debtors.  Joel A. Waite, Esq., and
Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor, serve
as the Debtors' local counsel.  Jefferies & Company, Inc., is the
Debtors' financial advisor.  Protiviti, Inc., is the Debtors'
restructuring consultant.  Kurtzman Carson Consultants LLC is the
Debtors' claims agent.

The Official Committee of Unsecured Creditors' counsel is Ashby &
Geddes, P.A.


OVERLAND STORAGE: Christopher Gopal's Employment Terminated
-----------------------------------------------------------
On January 14, 2011, the employment of Christopher Gopal, one of
Overland Storage, Inc.'s named executive officers in fiscal 2010,
terminated following a leave of absence which commenced in July
2010.  At the time of his leave of absence, Mr. Gopal was serving
as the Company's Vice President of Worldwide Operations and his
responsibilities were assumed by Eric L. Kelly, the Company's
President and Chief Executive Officer.

                      About Overland Storage

San Diego, Calif.-based Overland Storage, Inc. (Nasdaq: OVRL) --
http://www.overlandstorage.com/-- is a global provider of data
management and data protection solutions across the data
lifecycle.  By providing an integrated range of technologies and
services for primary, nearline, offline, archival and cloud data
storage, Overland makes it easy and cost effective to manage
different tiers of information over time.

The Company's balance sheet at September 30, 2010, showed
$39.27 million in total assets, $41.74 million in total
liabilities, and a stockholders' deficit of $2.47 million.

As reported in the Troubled Company Reporter on September 28,
2010, Moss Adams LLP, in San Diego, Calif., expressed substantial
doubt about the Company's ability to continue as a going concern,
following the Company's results for the fiscal year ended June 30,
2010.  The independent auditors noted of the Company's recurring
losses and negative operating cash flows.


PARK WINE: Files for Chapter 7 Liquidation
------------------------------------------
The Orlando Sentinel reports that Orlando, Florida-based Park Wine
Merchants LLC on Jan. 19 filed for liquidation under Chapter 7 of
the Bankruptcy Code.  The Company disclosed $154,293 in
liabilities.  The Company's major creditors are Republic National
Distributors Company, Tampa, owed $52,278; Chase Moneyline,
Louisville, Kentucky, $50,000; American Express, El Paso, Texas,
$11,200.


PAUL TRANSPORT: Disclosure Statement Hearing Continued to Feb. 2
----------------------------------------------------------------
The U.S. Bankruptcy Court has continued to February 2, 2011, at
9:30 a.m. the hearing on the disclosure statement explaining Paul
Transportation, Inc.'s Chapter 11 Plan of Reorganization.

Under the Plan, the Reorganized Debtor will pay most Claims over
time.

The Plan includes alternative treatments, dependent on whether
Class 22, which is the Class of Unsecured Claims of more than
$10,000, accepts or rejects the Plan.

Should Class 22 accept the Plan, Troy Paul will serve as President
of the Reorganized Debtor and sole member of its Board of
Directors.  If Class 22 rejects the Plan, the Reorganized Debtor's
management will be governed by its shareholders consistently with
applicable law.  New Paul will be managed by Troy Paul on the same
terms and conditions under which he would have been employed by
the Reorganized Debtor had Class 22 accepted the Plan.

Under the Plan, if Class 22 accepts the Plan, the Reorganized
Debtor will pay: i) in full Priority Claims and Secured Claims,
with most Claims being paid over time; ii) thirty-five cents on
the dollar on Unsecured Claims of $10,000 or less or Unsecured
Claims reduced to $10,000, with the payment occurring on or about
the Plan Effective Date; and (iii) forty cents on the dollar,
without interest, on Unsecured Claims of more than $10,000, with
payment occurring over time.  Should Class 22 accept the Plan, the
Interest Holder will retain his Pre-Petition equity security
interest.

Should Class 22 reject the Plan, Claimants holding Priority Claims
will be paid in full, again generally over time, either by the
Reorganized Debtor, which will be vested will all unencumbered
assets of the Estate (which the Debtor believes has negligible if
any value), or by New Paul, which will be an Oklahoma limited
liability company formed and wholly-owned by Troy Paul and,
generally, will be vested with all assets not vested in the
Reorganized Debtor.  New Paul will fully pay Secured Claims as
provided in the Plan, again over time, and perform under assumed
and assigned executory contracts and unexpired leases.  Should
Class 22 reject the Plan, Claimants holding Unsecured Claims will
receive a pro-rata distribution of one hundred percent (100%) of
the equity securities of the Reorganized Debtor, and the Interest
Holder's Pre-Petition equity security interest will be canceled,
and he will not receive or retain anything on account of his Pre-
Petition equity security interest.  As owners of the Reorganized
Debtors, Claimants holding Unsecured Claims will effectively
control the assets of the Reorganized Debtor, subject to the terms
of the Plan, which requires the Reorganized Debtor to use its
assets to first pay any unpaid Priority Claims, and then requires
use of its remaining assets to pay Claimants holding Unsecured
Claims pro-rata.  The Debtor in Possession does not believe it
likely that Unsecured Creditors would receive any distributions
should Class 22 reject the Plan.

A copy of the Disclosure Statement is available for free at:

        http://bankrupt.com/misc/PaulTransportation.DS.pdf

The Debtor also filed a summary of the Plan and a limited
Disclosure Statement intended specifically for Claimants holding
Claims in Class 21 under the Plan, which consists of Unsecured
Claims of $10,000 or less, and Unsecured Claims voluntarily
reduced to $10,000.

The Debtor believes that approximately 200 claimants hold
Unsecured Claims of $10,000 or less, which those claims
aggregating $189,898.  The remaining Unsecured Claims, which the
Debtor believes total $4,351,760, are held by about 40 Claimants.

The Pre-Petition Claims evidenced by the Schedules and the timely-
filed proofs of claim, however, show total unsecured claims of
$15,591,947.

A copy of the Limited Disclosure Statement for Class 21 Claimants
is available for free at:

      http://bankrupt.com/misc/PaulT.LimitedDSforClass21.pdf

                     About Paul Transportation

Enid, Oklahoma-based Paul Transportation Inc. provides flatbed
transportation services across the lower 48 states.  The Debtor
hauls a variety of goods, including pipe, steel, wallboard, coils,
paper, lumber and other products used in the construction and oil
and gas industries.  The Debtor maintains service terminals in
Oklahoma City, Oklahoma; Houston, Texas; and Fort Dodge,Iowa.
Troy Paul is the Debtor's sole shareholder, officer and
stockholder.  The Debtor employs 142 people.  In addition, the
Debtor also contracts with approximately 67 independent owner-
operator drivers.

Paul Transportation filed for Chapter 11 bankruptcy protection on
May 18, 2010 (Bankr. W.D. Okla. Case No. 10-13022).  Matthew C.
Goodin, Esq., and Stephen W. Elliott, Esq., at Kline, Kline,
Elliott & Bryant, assist the Debtor in its restructuring effort.

Lyle R. Nelson, Esq., L. Vance Brown, Esq., Eric Huddleston, Esq.,
an Karolina D. Roberts, Esq., at Elias, Books, Brown & Nelson, PC,
represent the Official Committee of Unsecured Creditors.

In its schedules, the Debtor reported $38,249,443 in total assets
and $23,535,843 in total liabilities.



PENZANCE CASCADES: Lender Battles Properties Over Cash in Ch. 11
----------------------------------------------------------------
Bankruptcy Law360 reports that a special servicer for $107 million
in debt is opposing efforts by four bankrupt commercial property
entities controlled by Garrison Investment Group to tap cash on
hand for operations, having accused the investor of seeking
Chapter 11 in bad faith.

                      About Penzance Cascades

Penzance Cascades North LLC, along with affiliates, filed for
bankruptcy protection in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-16643).  The affiliates that filed are Penzance Cascades West
LLC (Bankr. S.D.N.Y. Case No. 10-16644), Penzance Parkridge Two,
LLC (Case No. 10-16645) and Penzance Parkridge Five, LLC (Case No.
10-16646).

The Penzance entities own office buildings in Reston, Virginia.
They filed Chapter 11 petitions on Dec. 15, 2010, to head off
foreclosure the next day.  The properties, whose ultimate owner is
a fund managed by Garrison Investment Group, owe $107 million on a
mortgage where $67.5 million of the debt is now held in a
securitization.

Penzance Cascades North, owner of a five-story building in Reston,
Virginia, estimated assets of $10 million to $50 million and debt
of $100 million to $500 million.

Harvey A. Strickon, Esq., at Paul,Hastings, Janofsky & Walker LLP,
in New York, serves as counsel to the Debtors.


PHILADELPHIA RITTENHOUSE: Creditor Protests Bid to Hire Adviser
---------------------------------------------------------------
Rachel Feintzeig at Dow Jones' DBR Small Cap reports that an
affiliate of the secured creditor that prompted Philadelphia
Rittenhouse Developer L.P. to seek bankruptcy protection is now
insisting the Company has no prospects for reorganization or cash
flow as it wades through its Chapter 11 case.

According to the report, iStar Tara LLC, the iStar Financial Inc.
affiliate that pumped $240 million into the Philadelphia
Rittenhouse's downtown luxury condo project, is protesting the
Company's bid to hire New World Realty Advisors LLC as its
financial adviser.  In papers filed with the U.S. Bankruptcy Court
in Philadelphia, iStar called the proposed engagement an
"unreasonable waste of time and resources" incapable of producing
any benefit for the company or its creditors, the report notes.

"This is a single asset real estate case where the debtor has no
cash flow, no prospect for cash flow, no equity in its property
and no ability to reorganize," the report quoted iStar as saying.

                  About Philadelphia Rittenhouse

Philadelphia Rittenhouse Developer, L.P. is a joint venture
between ARC Properties, Inc., based in Clifton, New Jersey, and
Philadelphia-based Wheeler Brothers Holdings, LLC.  The company
was formed to develop 10 Rittenhouse Square, a 33-story
condominium building in Philadelphia.

Rittenhouse Developer filed for chapter 11 bankruptcy in response
to an action in Pennsylvania state court seeking to appoint a
receiver for the development project, which was brought by one of
the Company's lenders, iStar Tara, LLC.

Philadelphia Rittenhouse filed for Chapter 11 bankruptcy
protection on December 30, 2010 (Bankr. E.D. Pa. Case No. 10-
31201).  Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin,
P.C., serves as the Debtor's bankruptcy counsel.  The Debtor
estimated its assets and debts at $100 million to $500 million.
iStar Tara, LLC is represented in the chapter 11 case by the firm
of Blank Rome LLP.


PHOENIX FOOTWEAR: Deregisters Securities Unsold to Employees
------------------------------------------------------------
On January 21, 2011, Phoenix Footwear Group, Inc. filed Post-
Effective Amendments with the Securities and Exchange Commission
to Form S-8 filings to deregister securities offered to employees
under the Phoenix Footwear Group, Inc. Amended and Restated 2001
Long-Term Incentive Plan that were registered and have not been
sold:

   (a) 900,000 shares of common stock originally declared
       effective by the SEC on June 10, 2004;

   (b) 349,204 shares of common stock originally declared
       effective by the SEC on September 7, 2001; and

   (c) 1,000,000 shares of common stock originally declared
       effective by the SEC on January 3, 2007.

                      About Phoenix Footwear

Based in Carlsbad, California, Phoenix Footwear Group, Inc. (NYSE
Amex: PXG) specializes in quality comfort women's and men's
footwear with a design focus on fitting features.  Phoenix
Footwear designs, develops, markets and sells footwear in a wide
range of sizes and widths under the brands Trotters(R),
SoftWalk(R), and H.S. Trask(R).  The brands are primarily sold
through department stores, leading specialty and independent
retail stores, mail order catalogues and internet retailers and
are carried by approximately 650 customers in more than 900 retail
locations throughout the U.S.  Phoenix Footwear has been engaged
in the manufacture or importation and sale of quality footwear
since 1882.

The Company's balance sheet at October 2, 2010, showed $10,837,000
in total assets, $6,760,000 in total liabilities, and $4,077,000
in stockholders' equity.

As reported by the Troubled Company Reporter on November 29, 2010,
the Company said in its quarterly report on Form 10-Q for the
period ended October 2, 2010, that the severe global recession has
been challenging during the past two years and has dramatically
affected the Company's business as it is dependent on consumer
demand for its products.  During this time, the Company has faced
significant working capital constraints as the result of the
decline in sales, expenditures, and obligations associated with
its restructuring and diminished borrowing capacity.  These
factors, together with net losses and negative cash flows during
the past three fiscal years, raise substantial doubt about the
Company's ability to continue as a going concern.


POINT BLANK: Chapter 11 Plan Draws Objection on WaMu Ground
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that one of the grounds relied on by U.S. Bankruptcy Judge
Mary F. Walrath in refusing to confirm the Washington Mutual Inc.
reorganization plan is resonating in another Delaware bankruptcy.

Mr. Rochelle relates that in the Chapter 11 case of Point Blank
Solutions Inc., shareholder Rodney McFadden filed an objection to
the disclosure statement explaining the Point Blank plan.  Mr.
McFadden said the plan can't be confirmed because it only allows
current shareholders who are so-called accredited investors to buy
stock in the rights offering that provides part of the financing
for reorganized Point Blank.

According to Mr. Rochelle, Mr. McFadden pointed to Judge Walrath's
Jan. 7 WaMu opinion in which she said it was unfair discrimination
to give new stock only to creditors holding more than $2 million
in one of the creditor classes.  She said discrimination wasn't
justified by administrative convenience or economy resulting from
having a company with few shareholders not required to report to
the U.S. Securities and Exchange Commission.

Mr. Rochelle notes that the Point Blank case is pending before
U.S. Bankruptcy Judge Peter J. Walsh, and one bankruptcy judge is
not obliged to follow the rulings of another.  Until now, it had
been common practice for rights offerings to be available only to
accredited investors, in part so the reorganized company wouldn't
be a reporting company.

                        Point Blank Plan

The U.S. Bankruptcy Court for the District of Delaware will
convene a hearing on February 14, 2011, at 2:00 p.m. (prevailing
Eastern time), to consider adequacy of the Disclosure Statement.
Objections, if any, are due February 8, at 4:00 p.m.

The Plan Proponents are the Debtors, the Official Committee of
Unsecured Creditors, the Official Committee of Equity Security
Interest Holders, Privet Fund Management LLC, as investment
manager for Privet Opportunity Fund I, LLC and Privet Fund LP,
Privet Opportunity Fund I, LLC, Prescott Group Capital Management,
LLC, and Lonestar Capital Management, LLC, as investment advisor
to Lonestar Partners, LP and manager of PB Funding, LLC.

The Plan Proponents will begin soliciting votes on the Plan
following Disclosure Statement approval.

The Plan contemplates the reorganization and continuation of the
Debtors' business through a restructuring of each Debtor's debt
obligations and the generation of new capital through a Rights
Offering of new common stock in the Reorganized Debtors,
backstopped by the Backstop Parties.  The Rights Offering,
combined with the Debtors' available cash from operations going
forward and exit financing, if necessary and available, will
provide the funding necessary to consummate the Plan and pay
remaining secured and unsecured creditors in accordance with the
terms of the Plan.  All of the prepetition equity Interests in
Parent will be surrendered, and 100% of the equity securities
interests in the Reorganized Parent will be acquired pursuant to
the Rights Offering.

Generally, the Plan is structured around three key components.

   a) The Rights Offering/Direct Subscription.  In addition to
      cash on hand and an Exit Facility, if one is necessary and
      available, the Debtors intend to fund their reorganization
      effort-including the payment of all amounts due under the
      Plan-through the issuance and sale of shares of New Common
      Stock in Reorganized Parent in a minimum amount of
      $15,000,000 and (subject to certain consents and other
      conditions) up to a maximum of $25,000,000.  The New Common
      Stock will be sold (i) through a Rights Offering to eligible
      holders of Allowed General Unsecured Claims and Allowed Old
      Equity Interests, backstopped by the Debtors' existing DIP
      Lenders, and (ii) through a direct subscription of shares to
      two of the existing DIP Lenders, Privet and Prescott.

   b) The Inter-Debtor Compromise.  The Plan Proponents have
      identified several potential Claims, Causes of Action and
      other disputes that may exist between the several Debtors,
      including existing and potential disputes regarding (i) the
      value and disposition of Intercompany Claims, (ii) the
      valuation of the individual Debtor's Estates, (iii) the
      individual Debtor's respective ownership interest in certain
      potentially valuable lawsuits, (iv) the susceptibility of
      two or more of the Debtors' Estates to substantive
      consolidation and (v) the consideration, if any, that should
      be paid by Parent to retain its existing Interests in the
      Debtor Subsidiaries.

   c) The Recovery Trust. Under the Plan, holders of Allowed
      General Unsecured Claims, Allowed Subordinated Unsecured
      Claims, Allowed Class Action Claims and Allowed Old Equity
      Interests will be issued beneficial interests in a Recovery
      Trust established for the purpose of liquidating certain
      assets and distributing the proceeds thereof to the trust
      beneficiaries and making certain disbursements or
      distributions to Reorganized Parent.  On the Effective Date,
      the Reorganized Debtors will fund a Recovery Trust with a
      cash payment of $3 million, an additional $1 million for
      expenses and rights to certain potentially valuable Causes
      of Action, the proceeds of which will be distributed to the
      beneficiaries of the Recovery Trust in accordance with the
      waterfall.

The Debtors intend to pay in full administrative claims and
secured claims.

General unsecured claims will receive ratable proportion of
distributions from the recovery trust, and rights to participate
in the rights offering.  Holders of subordinated unsecured claims
will receive ratable proportion of distributions, if any, from the
recovery trust after payment in full of the general unsecured
claims.

Holders of equity interests will receive ratable proportion of
distributions from the recovery trust, pari passu, and rights to
participate in the rights offering.

A full-text copy of the Disclosure Statement is available for
free at http://bankrupt.com/misc/POINTBLANK_DS.pdf

                        About Point Blank

Headquartered in Pompano Beach, Florida, Point Blank Solutions,
Inc. -- http://www.pointblanksolutionsinc.com/-- designs and
produces body armor systems for the U.S. Military, Government and
law enforcement agencies, as well as select international markets.
The Company maintains facilities in Pompano Beach, Florida, and
Jacksboro, Tennessee.

The Company's former chief executive officer and chief operating
officer were convicted in September 2010 of orchestrating a
$185 million fraud.

Point Blank Solutions, formerly DHB Industries, filed for
Chapter 11 protection on April 14, 2010 (Bankr. D. Del. Case No.
10-11255).  Laura Davis Jones, Esq., and Timothy P. Cairns, Esq.,
at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel
to the Debtor.  Olshan Grundman Frome Rosenweig & Wolosky LLP
serves as corporate counsel.  T. Scott Avila of CRG Partners Group
LLC is the restructuring officer.  Epiq Bankruptcy Solutions
serves as claims and notice agent.

The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Equity Security
Holders in the case.  The Equity Committee has tapped Morrison
Cohen LLP, and The Bayard, P.A., as counsel.  Robert M. Hirsh,
Esq., and Heike M. Vogel, Esq., at Arent Fox LLP, serve as counsel
to the Creditors Committee, and Frederick B. Rosner, Esq., and
Brian L. Arban, Esq., at Messana Rosner & Stern LLP, serve as
co-counsel.


R & G ENTERPRISES: San Luis Tortilla in Chapter 11
--------------------------------------------------
Rick Desloge at St. Louis Business Journal reports that R & G
Enterprises LLC, which is under Chapter 11 protection, operates a
business locally under the name San Luis Tortilla Co.  The Company
makes and sells tortillas.  The Company is half-owned by Barbara
Abeyta and Greg Abeyta, both of Arnold, Missouri.

In its schedules, the Debtor disclosed $110,286 in assets and
$1,129,538 in debts.

St. Louis Business Journal reports the majority of Maryland
Heights, Missour-based Company's assets are $42,332 in accounts
receivable and $52,400 in machinery, fixtures and equipment.

The largest unsecured creditors include Minsa Corp. of Muleshoe,
Texas, with a claim of $205,021 from a judgment; Corn Flour
Producers LLC of Worthington, Ind., with a claim of $169,509 for
materials; and Serapio's Tortilla Factory of Oklahoma City, with a
claim of $158,000 for supplies.  The largest secured creditor is a
unit of the Internal Revenue Service, with a tax lien of $60,409.
Three of the four other secured creditors are taxing authorities.

St. Louis Business Journal relates that, in addition to the
judgment owed to Minsa, the bankruptcy filing shows R & G was a
party to five other collection actions in the last year and one
landlord-tenant lawsuit; R&G faces judgments in three of those
five collection matters, and the landlord action is pending in St.
Louis County Circuit Court.

R & G Enterprises, LLC, filed for Chapter 11 protection  (Bankr.
E.D. Mo. Case No. 11-40439) in St. Louis, Missouri, on Jan. 18,
2011.  Edward J. Karfeld, Esq., at Karfeld Law Firm, P.C., in St.
Louis, represents the Debtor in the Chapter 11 case.


REALOGY CORP: S&P Rates Proposed $700MM Secured Notes at 'CC'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned Realogy Corp.'s
proposed $700 million senior secured notes due 2019 its
preliminary issue-level rating of 'CC'.  S&P also assigned this
debt S&P's preliminary recovery rating of '6', indicating S&P's
expectation of negligible (0% to 10%) recovery for noteholders in
the event of a payment default.  While the notes will be secured
by the same collateral as the Company's existing first-lien credit
facility, the priority of the lien on the notes will be junior to
that of the first-lien facility.  Proceeds from the notes will be
used to prepay extended term loan balances under the first-lien
credit facility.

The 'CC' corporate credit rating, along with all existing issue-
level ratings for Realogy, remain on CreditWatch with positive
implications, where they were placed Jan. 18, 2011.

The CreditWatch listing reflects S&P's expectation that Realogy's
liquidity profile would be improved upon the close of the proposed
transactions, which include the amendment and extension of the
Company's first-lien credit facility.  S&P believes these
transactions would decrease the level of senior secured first-lien
debt in the Company's capital structure, and would also provide
the Company a sufficient cushion under its first-lien senior
secured net leverage covenant (the covenant steps down to 4.75x in
March 2011) over the intermediate term.

Ratings List
Realogy Corp.
Corporate Credit Rating       CC/Watch Pos/--

New Rating

Realogy Corp.
$700M sr secd nts due 2019    CC(prelim)
   Recovery Rating             6(prelim)


REALOGY CORP: Moody's Assigns 'Caa1' to Proposed $700MM Sr. Notes
-----------------------------------------------------------------
Moody's Investors Service assigned a Caa1 to Realogy Corporation's
proposed $700 million of senior secured notes and affirmed all
other ratings including the Caa2 Corporate Family Rating.  The
rating outlook remains positive.

On January 18, 2011, Realogy commenced a solicitation among its
lenders seeking amendments to the first lien secured credit
facility to, among other things, extend the maturity of a portion
of such facility from 2013 to 2016.  The proposed amendment and
extension of Realogy's first lien credit facility is contingent
upon approval by a majority of credit facility lenders and the
issuance of $700 million of the proposed secured notes.  The
proceeds from the secured note offering will be used to repay
extended term debt.

The credit facility is also expected to be amended to carve out
the proposed secured notes from the senior secured leverage ratio.
The proposed secured notes are expected to provide for liens on
substantially all of the company's domestic assets and 65% of the
stock of foreign subsidiaries.  The liens will be junior to the
liens securing the first lien credit facility but senior to the
liens securing the second lien term loans.  Realogy's SGL-3
speculative grade liquidity rating and the positive rating outlook
are contingent upon the completion of the proposed refinancing.

Moody's assigned the following rating (LGD assessments):

  -- $700 million senior secured notes due 2019, Caa1 (LGD 2, 24%)

  -- All other ratings were affirmed.

The Caa2 Corporate Family Rating and Caa3 Probability of Default
Rating reflects very high leverage, negative free cash flow and
uncertainty regarding the timing and strength of a recovery of the
residential housing market in the US.  Moody's expects Debt to
EBITDA of about 14 times for the 2010 calendar year.  Despite the
recently completed and proposed improvements to the debt maturity
profile, the Caa2 CFR continues to reflect Moody's view that
current debt levels are unsustainable and that a substantial
reduction in debt levels will be required to stabilize the capital
structure.  Assuming a recovery in the housing market over the
next two years, the balance sheet could be restructured through a
conversion of the $2.1 billion of subordinated debt into equity in
conjunction with an equity offering.  The ratings are supported by
the company's leading market positions, strong brands, solid
EBITDA margins and the potential for EBITDA growth upon a recovery
in the housing market.

The positive outlook reflects the improved debt maturity profile
pro forma for the refinancing and anticipates moderate Adjusted
EBITDA growth in 2011.  Profitability growth will be driven by
modest improvement in the top line and the realization of cost
reductions initiated in 2010.

The ratings could be upgraded if home sale volume or pricing
rebounds solidly in 2011 or 2012 leading to strong growth in
Adjusted EBITDA, improved credit metrics and liquidity.  A balance
sheet restructuring that meaningfully reduces leverage could also
lead to an upgrade.  The ratings or outlook could be pressured if
the housing market downturn continues into 2011 leading to a
material decline in Realogy's profitability and liquidity.

The principal methodologies used in this rating were Global
Business & Consumer Service Industry published in October 2010,
and Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.

Realogy Corporation is a leading global provider of real estate
and relocation services.  Realogy is substantially owned and
controlled by an affiliate of Apollo Management, L.P. (Apollo),
and reported revenues of about $4.2 billion in the twelve months
ended September 30, 2010.


R.H. HOOVER: Case Summary & 18 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: R.H. Hoover, Inc.
          dba Hoover Premier Homes
        9209 East Mission Avenue, Suite F
        Spokane, WA 99206-4096

Bankruptcy Case No.: 11-00295

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       Eastern District of Washington (Spokane/Yakima)

Debtor's Counsel: Brett T. Sullivan, Esq.
                  SULLIVAN STROMBERG, PLLC
                  827 W. 1st Avenue, Suite 425
                  Spokane, WA 99201-3914
                  Tel: (509) 413-1004
                  Fax: (509) 413-1078
                  E-mail: bretts@sullivanstromberg.com

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $1,000,001 to $10,000,000

A list of the Company's 18 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/waeb11-00295.pdf

The petition was signed by Karen L. Dorsey, treasurer.


RHI ENTERTAINMENT: Settles with Crown Media & Hallmark
------------------------------------------------------
BankruptcyData.com reports that RHI Entertainment, Inc., is
seeking approval of a settlement with Crown Media Holdings, Inc.,
Hallmark Cards, Inc. and MATn Movies & Televisions Productions
GmbH & Co. Project IV KG in connection with their disputes
regarding certain distribution rights and obligations.

According to BData, terms of the settlement include:

   -- the transfer of Picture Rights by RHI Entities;

   -- the payment by Hallmark of settlement Amount and
      adherence to the continuing guaranty, waiver of
      indemnification claim against RHI;

   -- the assignment of Crown Media license fees;

   -- the payments of third party obligations;

   -- the future exploitation of picture rights;

   -- the rights to gross receipts of picture rights;

   -- the entry into a new distribution agreement;

   -- the survival of sublicense agreements;

   -- the termination of transaction documents; and

   -- the dismissal of lawsuits and releases among parties.

Eric Morath, writing for Dow Jones' Daily Bankruptcy Review, notes
that RHI Entertainment is handing over its rights to the "Phantom
Racer" film to National Bank of Canada to settle a $650,000 debt.
The bank loaned the funds necessary to produce the movie and
retained a lien on the film after RHI acquired it.

According to Mr. Morath, RHI said in papers filed with the
Bankruptcy Court that the "Phantom Racer" is one of several movies
it intends to hand over to lenders as part of its reorganization
plan.

                       About RHI Entertainment

New York-based RHI Entertainment, Inc., develops, produces and
distribute new made-for-television movies, mini-series and other
television programming worldwide.  It filed for Chapter 11
bankruptcy protection on December 10, 2010 (Bankr. S.D.N.Y. Case
No. 10-16536).  D.J. Baker, Esq., Rosalie Walker Gray, Esq., Keith
A. Simon, Esq., Adam S. Ravin, Esq., and Jude Gorman, Esq., at
Latham & Watkins LLP, serve as the Debtors' bankruptcy counsel.
The Debtor disclosed $524,722,000 in total assets and $834,094,000
in total debts in its chapter 11 petition.

Affiliates RHI Entertainment, LLC (Bankr. S.D.N.Y. Case No.
10-16537), RHIE Holdings Inc. (Bankr. S.D.N.Y. Case No. 10-16538),
RHI Entertainment Holdings II, LLC (Bankr. S.D.N.Y. Case No.
10-16541), RHI Entertainment Distribution, LLC (Bankr. S.D.N.Y.
Case No. 10-16549), RHI International Distribution Inc. (Bankr.
S.D.N.Y. Case No. 10-16550), RHI Entertainment Productions, LLC
(Bankr. S.D.N.Y. Case No. 10-16551), HE Pro Tunes, Inc. (Bankr.
S.D.N.Y. Case No. 10-16552), HEGOA INC. (Bankr. S.D.N.Y. Case No.
10-16553), HEP Music, Inc. (Bankr. S.D.N.Y. Case No. 10-16554),
HEP SS Music Inc. (Bankr. S.D.N.Y. Case No. 10-16555), Don
Quixote, Inc. (Bankr. S.D.N.Y. Case No. 10-16556), Independent
Projects, Inc. (Bankr. S.D.N.Y. Case No. 10-16557), Library
Storage, Inc. (Bankr. S.D.N.Y. Case No. 10-16558), Metropolitan
Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16560), NGP
Holding, Inc. (Bankr. S.D.N.Y. Case No. 10-16561), and SLB
Productions, Inc. (Bankr. S.D.N.Y. Case No. 10-16562) filed
separate Chapter 11 petitions.

Logan & Company, Inc., serves as the Debtors' claims and noticing
agent.

RHI's First Lien Lenders are represented by Michael A. Chapnick,
Esq. -- mchapnick@morganlewis.com -- and Wendy S. Walker, Esq. --
wwalker@morganlewis.com -- at Morgan, Lewis & Bockius LLP, and
RHI's Second Lien Lenders are represented by Mark R. Somerstein,
Esq. -- mark.somerstein@ropesgray.com -- and Patricia I. Chen,
Esq. -- patricia.chen@ropesgray.com -- at Ropes & Gray LLP.

As reported in the Troubled Company Reporter on Dec. 16, 2010, RHI
Entertainment Inc., won approval to put its prepackaged Chapter 11
case on a fast track and hold a combined disclosure statement and
restructuring plan confirmation hearing as early as Feb. 17, 2011.
The Prepackaged Plan provides that, on its Effective Date, (a) the
First Lien Lenders will receive (i) $300 million of New Term Loan
Obligations and (ii) roughly 99% of the New Common Stock (subject
to dilution); and (b) the Second Lien Lenders will receive (i)
roughly 1% of the New Common Stock (subject to dilution), (ii) New
Warrants representing 15% ownership of the New Common Stock on a
fully diluted basis, and (iii) a limited fee and expense
reimbursement of up to $250,000.  A hearing has been scheduled for
Feb. 17, 2011, to consider the adequacy of the Disclosure
Statement.


ROCK-TENN: Moody's Reviews Low-B Ratings for Likely Downgrade
-------------------------------------------------------------
Moody's Investors Service placed all ratings of Rock-Tenn Company
on review for possible downgrade, including the company's Ba1
Corporate Family Rating, Ba1 Probability of Default Rating and
individual instrument ratings.  The rating action was prompted by
Rock Tenn's announcement that it has agreed to acquire Smurfit-
Stone Container Corporation.

Moody's review will focus on the amount of acquisition debt
financing taken on to fund the transaction; the size and pace
of any cost synergies that can be realized; post-closing credit
metrics taking into consideration SSCC's large unfunded pension
liability; the integration of higher cost linerboard mills that
may need increased capital spending; and Rock Tenn's ability to
maintain adequate liquidity.

The aggregate purchase price being paid for SSCC's equity in
the transaction is approximately $3.5 billion, consisting of
approximately $1.8 billion of cash and the issuance of
30.9 million shares of Rock Tenn common stock.  Rock Tenn has
received $3.7 billion in committed bank financing to finance the
cash portion of the transaction, to refinance existing debt and to
provide liquidity for the combined operations.  The acquisition is
expected to close in the second calendar quarter of 2011 and is
subject to regulatory clearances and other customary closing
conditions.  Assuming the transaction closes as anticipated,
existing debt at Smurfit-Stone Container Enterprises, Inc., will
likely be repaid and all of Moody's ratings of that entity
withdrawn.

These ratings were placed on review:

On Review for Possible Downgrade:

Issuer: Rock-Tenn Company

  -- Probability of Default Rating, Placed on Review for Possible
     Downgrade, currently Ba1

  -- Corporate Family Rating, Placed on Review for Possible
     Downgrade, currently Ba1

  -- Senior Secured Bank Credit Facility, Placed on Review for
     Possible Downgrade, currently Baa3

  -- Senior Unsecured Regular Bond/Debenture, Placed on Review for
     Possible Downgrade, currently Ba2

Outlook Actions:

Issuer: Rock-Tenn Company

  -- Outlook, Changed To Rating Under Review From Stable

Moody's last rating action was on November 30, 2009, when it
increased Rock Tenn's corporate family rating to Ba1 from Ba2
reflecting the company's improved credit protection metrics.

The principal methodology used in rating Rock Tenn was the Moody's
Global Paper and Forest Products Industry Rating Methodology,
published in September 2009.

Headquartered in Norcross, Georgia, Rock-Tenn Company is a
manufacturer of paperboard, containerboard and consumer and
corrugated packaging.  The company had annual net sales of
approximately $3 billion in its fiscal year ending September 30,
2010, and has operating locations in the United States, Canada,
Mexico, Chile and Argentina.


ROSETTA RESOURCES: S&P Cuts Senior Unsecured Rating to 'B-'
-----------------------------------------------------------
Standard & Poor's Ratings Services took several rating actions on
16 U.S. oil and gas exploration and production companies following
an industry review.  S&P's review on the sector followed S&P's
Sept. 30, 2010, revision of S&P's exploration and production
recovery criteria.  The new approach aims to better reflect S&P's
expectation for commodity prices and reserve values in a default
scenario.

The rating actions S&P took, were on speculative-grade companies
and affected specific issues and their respective recovery
ratings. S&P did not take any corporate credit rating actions.
(Standard & Poor's recovery rating scale ranges from '6',
indicating expectations of negligible [0%-10%] recovery in a
payment default, to '1+', indicating expectations of full [100%]
recovery.)  S&P included in its reviews an updated reserve report
utilizing S&P's new price deck.

Ratings List
Issue Ratings lowered; Recovery Ratings Revised
                                           To     From
Quicksilver Resources Inc. (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          5      3

BreitBurn Energy Partners (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Ratings                         5      4

Helix Energy Solutions Group Inc. (B/Stable/--)
Senior Unsecured                          CCC+   B-
  Recovery Ratings                         6      5

Rosetta Resources Inc. (B/Stable/--)
Senior Unsecured                          B-     B+
  Recovery Rating                          5      2

Chaparral Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          4      2

NFR Energy LLC (B/Stable/--)
Senior Unsecured                          B-     B
  Recovery Rating                          5      4

Venoco Inc. (B/Stable/--)
Second-Lien Secured                       B      BB-
  Recovery Rating                          4      1

Delta Petroleum Corp. (CCC/Negative/--)
Senior Unsecured                          CCC-   CCC
  Recovery Rating                          5      4

Dune Energy Inc. (CCC-/Negative/Unsolicited)
Second-Lien Secured                       CC       CCC-
  Recovery Rating                          5        4


Issue Ratings Raised; Recovery Ratings Revised
                                           To     From
Penn Virginia Corp. (BB-/Stable/--)
Subordinated                              B+     B
  Recovery Rating                          5      6

Forest Oil Corp. (BB-/Stable/--)
Senior Unsecured                          BB-    B+
  Recovery Rating                          4      5

Clayton Williams Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B-
  Recovery Rating                          4      5


Issue Ratings Unchanged; Recovery Ratings Revised
                                           To     From
Whiting Petroleum Corp. (BB/Stable/--)
Recovery Rating                           4      3

Range Resources Corp. (BB/Stable/--)
Recovery Rating                            3      4

Bill Barrett Corp. (BB-/Stable/--)
Recovery Rating                           3      4

PetroQuest Energy Inc. (B/Stable/--)
Recovery Rating                           4      3


ROSMART PLAZA: Files for Chapter 7 Liquidation
----------------------------------------------
The Orlando Sentinel reports that Melbourne, Florida-based Rosmart
Plaza Inc., on Jan. 16 filed for liquidation under Chapter 7 of
the U.S. Bankruptcy Code.  The Company disclosed $407,186 in
liabilities.  A meeting of creditors is set for Feb. 14, 2011.


S & E PROPERTIES: Case Summary & 3 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: S & E Properties, LLC
        P.O. Box 489
        Nitro, WV 25143

Bankruptcy Case No.: 11-30045

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       Southern District of West Virginia (Huntington)

Judge: Ronald G. Pearson

Debtor's Counsel: Marshall C. Spradling, Esq.
                  100 Capitol Street, Suite 703
                  Charleston, WV 25301
                  Tel: (304) 343-2544
                  Fax: (304) 343-2546
                  E-mail: marshallspradling@wvdsl.net

Estimated Assets: $0 to $50,000

Estimated Debts: $1,000,001 to $10,000,000

A list of the Company's three largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/wvsb11-30045.pdf

The petition was signed by Scott Cable.


SANDRA ANN READ: Time for Property Tax Appeal Extended
------------------------------------------------------
WestLaw reports that a bankruptcy statute that extended, for two
years postpetition, the time period fixed under applicable
nonbankruptcy law for a debtor to commence an action, where such
time period had not expired before the petition date, applied to
permit a Chapter 11 debtor to contest, under state law, the tax
assessments for her investment properties, since the 60-day window
within which such a challenge had to be raised under state law had
not expired before the debtor filed her bankruptcy petition.
After finding ambiguous a statutory limitation on the bankruptcy
court's power to determine ad valorem taxes that was added to the
Bankruptcy Code by the Bankruptcy Abuse Prevention and Consumer
Protection Act (BAPCPA), a Florida bankruptcy court concluded that
the limitation applied in cases in which no prior final
adjudication of ad valorem tax liability had been made and the
applicable nonbankruptcy period for contesting the tax obligation
expired prior to the debtor's petition filing.  In re Read, ---
B.R. ----, 2011 WL 180085 (Bankr. M.D. Fla.) (Williamson, J.).

A copy of the Honorable Michael G. Williamson's Memorandum Opinion
dated Jan. 19, 2011, discussing the interplay of 11 U.S.C. Sec.
108 and 11 U.S.C. Sec. 505 in her bankruptcy proceeding, is
available at http://is.gd/idQ8cofrom Leagle.com.

Sandra Ann Read sought chapter 11 protection (Bankr. M.D. Fla.
Case No. 09-25809) on Nov. 10, 2009, and is represented by Herbert
R. Donica, Esq., at the Donica Law Firm PA in Tampa, Fla.  At the
time of the filing, Ms. Read estimated her assets and debts at
$1 million to $10 million.


SATELITES MEXICANOS: Has Deal with Noteholders for U.S. Prepack
---------------------------------------------------------------
Satelites Mexicanos, S.A. de C.V. (Satmex SAB) has reached an
agreement with the holders of more than two-thirds of the
outstanding principal amount of its Second Priority Senior Secured
Notes due 2013 regarding a comprehensive recapitalization to be
effected through the solicitation of a prepackaged plan of
reorganization to be filed in the United States bankruptcy court.
The recapitalization will provide the resources for the Company to
finance the timely completion of Satmex 8, a satellite scheduled
to be launched in 2012 to replace the Company's Satmex 5
satellite, and to lay the groundwork for the future construction
of Satmex 7, which is intended to replace the Company's
Solidaridad 2 satellite.

Satmex has joined in a Restructuring Support Agreement among the
Supporting Holders and Holdsat Mexico S.A.P.I. de C.V., a Mexican
company which was newly formed in cooperation with the Supporting
Holders to effect the proposed recapitalization, and which will be
majority controlled by certain Mexican partners in compliance with
applicable Mexican foreign investment laws.  The Plan contemplates
that the recapitalization will be financed with the proceeds of an
offering of up to $325 million in aggregate principal amount of
new senior secured debt financing and the proceeds of a rights
offering of equity securities in the indirect parent of
reorganized Satmex to eligible holders of Second Priority Senior
Secured Notes in an aggregate amount of up to $96.25 million.
Eligible holders of Second Priority Senior Secured Notes will also
have the right to invest in their pro rata share of a follow-on
issuance of equity securities in an aggregate amount of up to
$40 million, which may be called by the reorganized company for
purposes of funding the construction and launch of Satmex 7.

Under the terms of the Plan, holders of Satmex's First Priority
Senior Secured Notes due 2011 will be paid out in cash at par plus
accrued interest.  Holders of Satmex's Second Priority Senior
Secured Notes will receive their pro rata share of (i) a pool of
equity interests in the indirect parent of reorganized Satmex (the
"Parent Interests"), (ii) the Primary Rights to invest in
additional Parent Interests, and (iii) the Follow-On Rights, but
only to the extent that holders have exercised their Primary
Rights.  In the alternative, such holders may elect to receive, in
lieu of the Parent Interests, Primary Rights and Follow-On Rights,
a cash payment of 38 cents for every dollar of Second Priority
Senior Secured Notes held by such electing holders, which payment
will be funded by certain of the Supporting Holders.  It is
anticipated that other creditors, including trade creditors, will
be paid in full under the Plan.  If the Plan is consummated and
certain other conditions are satisfied, existing stockholders of
Satmex will receive their share of $6.25 million under a purchase
agreement with Holdsat Mexico S.A.P.I. de C.V. as part of the
recapitalization transactions.

The Restructuring Support Agreement provides that the Supporting
Holders will vote in favor of the Plan. Furthermore, Centerbridge
Partners, L.P., Monarch Alternative Capital, L.P., Moneda Asset
Management, New Generation Advisors, LLC and Outrider Management,
LLC and certain of their affiliates have committed to exercise all
of the rights granted to them under the Plan as holders of the
Second Priority Senior Secured Notes and to purchase any interests
which are not subscribed by other holders.

"We are pleased by the confidence in Satmex shown by the
investment commitment of the Supporting Holders," said Patricio
Northland, Chief Executive Officer of Satmex.  "As a result of
these initiatives our debt and interest expense will be reduced
and our liquidity and equity capital will be greatly enhanced.
This will provide support for ongoing service to our customers in
the near term and will facilitate a number of important operating
initiatives, including the completion of construction and the
launch of our Satmex 8 satellite, and the entry into a
construction and launch agreement for our Satmex 7 satellite.

These initiatives will ensure that Satmex continues to provide our
customers with the broadest and most flexible C and Ku band
coverage across the hemisphere, and allow us to capitalize on the
attractive growth opportunities in our core markets. We intend to
move forward as expeditiously as possible to complete the
recapitalization, and we anticipate that the process will have no
day-to-day impact on our suppliers, customers or employees."  Mr.
Northland also stated that he is grateful to the Company's
employees for their dedication and to Satmex's customers and
business partners for their continued support over the past year.

Jared S. Hendricks, a Managing Director of Centerbridge Partners,
expressed appreciation on behalf of the Backstop Parties to
Satmex's management team for their tireless efforts in bringing
the Company to this important threshold.  "This transaction would
not have been possible without the dedication and leadership of
Satmex's management team, whom the Backstop Parties are excited to
support as the Company enters this next stage of its corporate
development," said Mr. Hendricks.

"We believe in the opportunities for growth in the markets served
by Satmex and are pleased to be part of the Company's continued
development" said Josiah Rotenberg, a Managing Principal of
Monarch Alternative Capital.  "We look forward to a long and
mutually beneficial relationship."

Completion of the transaction is subject to certain regulatory
approvals and other conditions precedent.

Lazard and its Mexican alliance partner, Alfaro, Davila y Rios,
S.C. are serving as financial advisors to Satmex, and Greenberg
Traurig is serving as U.S. counsel and Santamarina y Steta and
Rubio Villegas & Asociados are serving as the Company's Mexican
counsels.

Jefferies & Company, Inc. is serving as the financial advisor to
certain holders of the Second Priority Senior Secured Notes, and
Ropes & Gray LLP is serving as U.S. counsel and Cervantes Sainz as
Mexican counsel to this group.

The bonds maturing this year are trading at par while the bonds
due in 2013 traded on Jan. 19 for 39.5 cents on the dollar,
according to Trace, the bond-price reporting system of the
Financial Industry Regulatory Authority, Bloomberg News reported.

                      U.S. Bankruptcy in 2006

Bill Rochelle, the bankruptcy columnist at Bloomberg News, notes
that Satelites Mexicanos will be seeking a prepackaged bankruptcy
reorganization in the U.S. less than five years after emerging
from a prior U.S. Chapter 11 case.

Mr. Rochelle recounts that litigated disputes began in May 2005,
when bondholders filed an involuntary Chapter 11 petition against
Satmex.  The company responded in June 2005 by filing a concurso
mercantil, the Mexican version of reorganization.  It later asked
the U.S. bankruptcy judge to dismiss the involuntary petition.  A
partial settlement was made in mid-2005 entailing a dismissal of
the involuntary Chapter 11 petition while Satmex filed a Section
304 ancillary petition in New York, so that the bankruptcy court
could assist the Mexican court by enjoining legal actions in the
U.S.  The Section 304 ancillary petition was the predecessor to
what is now Chapter 15 for cross-border insolvencies.

After reaching final agreement with bondholders to restructure
$800 million in debt, the Company filed a prepackaged Chapter 11
petition in New York.  The plan called for swapping $203.4 million
of senior secured floating notes for $234.4 million in first-lien
senior-secured notes, while $320 million in 10.125% unsecured
notes became $140 million of second-lien notes and 78% of the new
common stock.

The prior petition listed assets of $906 million against debts
totaling $743.5 million.

In August 2003, Satmex defaulted on $320 million in senior
unsecured notes.  It was roughly half owned by Loral Space &
Communications Ltd., with the remainder split between Mexican
shareholders and the Mexican government, which had 23% of the
stock.  Satellite manufacturer Loral underwent its own Chapter 11
reorganization in July 2003.

                         About Satmex SAB

Satelites Mexicanos, S.A. de C.V., (Satmex) is a Mexico-based
satellite service provider in Latin America.  Satmex's fleet
offers hemispheric and regional coverage throughout the Americas.

Satmex balance sheet a June 30, 2010, showed US$438.29 million in
assets, US$516.55 million in liabilities, and a US78.26 million
shareholders' deficit.

Satmex had a net loss of US$6.12 million on US$53.06 million of
revenue for the six months ended June 30, 2010, compared with a
net loss of US$8.81 million on US$50.35 million of revenue for six
months ended June 30, 2009.

Satmex has a 'C' issuer rating and 'Ca' long term corporate family
rating, with negative outlook, from Moody's Investors Service.


SCHAEFER SALT: Gets Sanctions for Improper Chapter 7 Filing
-----------------------------------------------------------
Bankruptcy Judge Novalyn L. Winfield imposed sanctions against
Schaefer Salt Recovery, Inc., and Nicholas Khoudary, SSR's Vice
President and counsel, in connection with an improperly filed
Chapter 7 petition.  Judge Winfield awarded Carol Segal (a) $9,239
for fees and $7.90 for expenses in connection with the Chapter 7
case Mr. Khoudary commenced on SSR's behalf; and (b) $2,220 for
fees in connection with a Motion for Reconsideration.

On May 12, 2004, a mere eight days after it was formally
incorporated as a business entity, SSR filed a bare bones Chapter
11 petition (Bankr. D. N.J. Case No. 04-_____).  SSR's only assets
were mortgages on three properties as to which tax lien
foreclosure actions brought by Ms. Segal were pending in the
Superior Court of New Jersey.

At Ms. Segal's behest, the Bankruptcy Court dismissed the Chapter
11 petition by order dated July 6, 2004, on a finding that it had
been filed in bad faith, but struck language in the proposed order
that would have barred SSR from filing another petition for 180
days.  Following the dismissal, the foreclosure actions were
reinstated in the Superior Court.

On August 13, 2004, SSR filed a new petition (Bankr. D. N.J. Case
No. 04-36630), this time pursuant to Chapter 7, for no apparent
reason other than to cause the automatic stay to again kick in.
Ms. Segal sought dismissal of the Chapter 7 petition.

At a hearing on August 24, 2004, Mr. Khoudary advised the
Bankruptcy Court that SSR consented to the dismissal of the
Chapter 7 petition and that he saw no need to appear.  At the
hearing, the Bankruptcy Court held that sanctions should be
imposed against Mr. Khoudary and SSR under 28 U.S.C. Sec. 1927.
The Bankruptcy Court subsequently determined that it could not
impose sanctions because of the supervisory rule articulated in
Pensiero v. Lingle, 847 F.2d 90 (3d Cir. 1988).  Ms. Segal first
filed a motion for reconsideration, which was denied.  She then
appealed to the U.S. Court of Appeals for the Third Circuit, which
reversed in 2008.

According to Judge Winfield, in dismissing the Chapter 11 case the
Bankruptcy Court made it known that it considered the case to be
lacking a reorganizational purpose.  "This alone certainly should
have caused Khoudary and SSR to pause and consider whether the
Chapter 7 case had an actual bankruptcy purpose," Judge Winfield
said.  Given the timing of the filing and the events outlined that
precipitated the Chapter 7 filing, Judge Winfield said it is
readily apparent that Mr. Khoudary and SSR made no objective
assessment of the bankruptcy purpose that could be achieved from a
Chapter 7 case.

A copy of the Court's January 21, 2011 Letter Decision is
available at http://is.gd/tWuiY9from Leagle.com.


SCITOR CORP: Moody's Assigns 'B2' Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service assigned B2 corporate family and
probability of default ratings to Scitor Corporation.
Concurrently, a senior secured bank credit facility rating of B2
has been assigned.  The ratings outlook is stable.  The ratings
assigned anticipate increasing leverage from the company's planned
$305 million senior secured credit facility which will refinance
an existing credit facility, fund retirement of the company's
subordinated debt, and provide for preferred stock redemption and
a common stock dividend.

The B2 CFR encompasses Scitor's elevated financial leverage
against a solid niche position as a services contractor to the
U.S. intelligence community, historically good EBITDA margins, and
an expectation of free cash flow to debt in the high single digit
percentage range.  The company's work centers on highly classified
programs in the intelligence areas that should continue realizing
federal outlay funding and growth.  Long-established relationships
across the intelligence and U.S. Department of Defense community
and technical expertise in science and engineering disciplines
bodes well for continuing competitiveness.  Substantial backlog,
historical re-compete contract win rates and low employee turnover
should support good revenue growth with free cash flow reducing
the debt load materially over the next few years.  The rating also
encompasses debt to EBITDA proforma for the transaction in the
mid-7.0 times range and risk from contract concentration.  Moody's
notes some potential for tighter margins in the future as U.S.
fiscal deficits could encourage non-fixed price contractors with
good margins, like Scitor, to demonstrate greater pricing
flexibility as a means of maintaining re-compete rates.

Upward rating momentum could develop with an expectation of debt
to EBITDA sustained below 5.5 times with EBITDA to interest
approaching the mid- 2.0 times range and a good liquidity profile.
Downward pressure could mount if the company were to sustain debt
to EBITDA beyond 7.0 times, or if backlog were to deteriorate
significantly.

Ratings assigned, subject to review of final documentation:

  -- Corporate family and probability of default, B2
  -- $30 million senior secured revolving credit due 2016, B2 LGD
     3, 46%
  -- $275 million senior secured term loan B due 2017, B2 LGD 3,
     46%

The principal methodologies used in this rating were Global
Aerospace and Defense published in June 2010, and Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.

Scitor Corporation, is a provider of engineering, management
consulting and information services for highly classified programs
to the U.S. Intelligence Community.  Revenues in FY2010 were
approximately $600 million.


SCOTLAND-COLORADO: Case Summary & 5 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Scotland-Colorado, LLC
        Main Office
        1777 Borel Place Suite 1000
        San Mateo, Ca 94402

Bankruptcy Case No.: 11-30246

Chapter 11 Petition Date: January 23, 2011

Court: U.S. Bankruptcy Court
       Northern District of California (San Francisco)

Judge: Thomas E. Carlson

Debtor's Counsel: Neil Jon Bloomfield, Esq.
                  LAW OFFICES OF NEIL JON BLOOMFIELD
                  901 E. Street, #100
                  San Rafael, CA 94901
                  Tel: (415) 454-2294
                  E-mail: njbloomfield@njblaw.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 five largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/canb11-30246.pdf

The petition was signed by Robert J. Howie, manager.


SECURECARE SERVICES: Emerges From Receivership with Invotex's Aid
-----------------------------------------------------------------
Raymond J. Peroutka, Jr., Managing Director and CEO of Invotex
Group, disclosed that the firm has successfully reorganized the
financially troubled SecureCare Services, Ltd., which has been
renamed Compass, Inc., and its Receivership has been dismissed by
the Circuit Court for Montgomery County, Maryland.

Prior to Invotex's July 2008 appointment by the Secretary of the
Department of Health and Mental Hygiene as Receiver for
SecureCare, the company was deeply insolvent and had posted a loss
of $2.9 million for the prior 12 months.  Over a period of 24
months, Invotex implemented a complete reorganization of
SecureCare, its staff, resident housing, quality of care systems
and financial reporting systems.  In addition, SecureCare's new
Executive Director, Andrea Kolp, helped guide SecureCare during
the process with the goal of remaking SecureCare into a model DDA
agency.  The unaudited financial statements of the now not-for-
profit, which is overseen by a volunteer board of directors, shows
net income in excess of $1.5 million for the period ended June 30,
2010.

According to Peroutka, "This was a big win for everyone involved,
including the staff, creditors, state regulators and, most
importantly, the constituents.  In a very brief time following our
appointment as receiver, we were able to assess the operational
and financial problems, impose controls and begin corrective
action.  This was all accomplished while assuring the health and
safety of more than 90 developmentally disabled individuals.  Not
only did they receive uninterrupted service throughout the
receivership, but today they have a stronger, financially stable
agency upon which they can depend."

                        About Compass Inc.

Since 1994, Compass has supported individuals with developmental
disabilities to live and work in communities of their choice.
Almost immediately from its beginnings, Compass became recognized
as one of the outstanding providers of residential services in
Maryland with a niche in supporting individuals with coexisting
Mental Health conditions and Developmental Disabilities. Further,
Compass' new 501(c)(3) designation will enhance its ability to
obtain grants and raise funds from charitable sources.


SMURFIT-STONE: Moody's to Withdraw Ratings After Rock Tenn Deal
---------------------------------------------------------------
Moody's commented on Rock Tenn Company's acquisition of Smurfit-
Stone Container Corporation.  In connection with the transaction
funding, Rock Tenn intends to retire the senior secured term loan
at Smurfit-Stone Container Enterprises, Inc.  Assuming the
transaction closes as anticipated, SSCE's existing debt will
likely be repaid and all of Moody's ratings of that entity
withdrawn.

Moody's last rating action was on June 30, 2010, when it removed
the provisional designation on SSCE's B2 term loan, corporate
family and probability of default ratings.

The principal methodology used in rating SSCE was the Moody's
Global Paper and Forest Products Industry Rating Methodology,
published in September 2009.  Other methodologies and factors that
may have been considered in the process of rating this issuer can
also be found in the Rating Methodologies sub-directory on Moody's
website.

Headquartered in Creve Coeur, MO, Smurfit-Stone Container
Corporation operates through a wholly-owned subsidiary company,
Smurfit-Stone Container Enterprises, Inc.  The company is an
integrated producer of containerboard and corrugated containers
and is a large collector, marketer, and exporter of recycled
fiber.


SONRISA PROPERTIES: Compass Plan Heads to Confirmation Hearing
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
approved the disclosure statement explaining the Second Amended
Plan of Reorganization filed by Compass Bank for Sonrisa
Properties, Ltd.

As reported by the Troubled Company Reporter on January 20, 2011,
Compass Bank filed a disclosure statement explaining its proposed
Plan of Liquidation, as twice amended, for the Debtor.  Compass
Bank, the Debtor's largest secured creditor, is owed a principal
balance of roughly $7,100,000 plus accrued interest exceeding
$800,000.

The Court fixed February 15, 2011, as the last day for submitting
written acceptances or rejections of the Plan.

The Court will convene a hearing on February 22, 2011, at 10:30
a.m., to consider confirmation of the Compass Bank Plan.
Objections are due February 8, 2011.

At the Feb. 22 hearing, the Bankruptcy Court will also consider
confirmation of the Plan proposed by the Debtor's management.

                         Compass Bank Plan

The Compass Plan provides for the sale of the Debtor's property
via an auction to take place within 120 days of the Effective Date
of the Plan.  The Auction will be conducted by Auction Resolutions
dba Tranzon Auction Resolutions, a Texas limited liability company
based in Cypress, Texas.

The Property will be sold at Auction via one or more cash sales
and/or a credit bid sale.  Net Sales Proceeds will be distributed
by the Disbursing Agent in accordance with the Plan.  The
Disbursing Agent will also liquidate any remaining assets and
distribute Other Liquidation Proceeds and Pre-Confirmation
Remaining Sale Proceeds in accordance with the Plan.

Under the Plan of Compass Bank, each holder of a unsecured claim
under Class 5 will receive (in full satisfaction of such Allowed
Claim) its pro rata share of (a) Net Sale proceeds after payment
in full of Allowed Claims in Classes 1-4 and funding of the
Disbursing Agent Reserve, and (b) Other Liquidation Proceeds plus
interest at the Federal Judgment Interest Rate from the Petition
Date until the date of payment.  The distribution to holders of
Allowed Class 5 Claims will in the aggregate be no less than (i)
the General Unsecured Minimum Payment, and (ii) any portion of the
Unsecured Priority Tax Minimum Payment remaining after payment of
Allowed Class 2 Claims.

Compass Bank projects that each Unsecured Creditor would receive
at least 10% of its Allowed Claim under the Plan.  If there is
insufficient cash sales proceeds to fund these payments, they
would be paid directly by Compass Bank.

A copy of the Compass Bank Second Amended Disclosure Statement is
available for free at:

   http://bankrupt.com/misc/Sonrisa.2ndAmendedCompassDS.pdf

Compass Bank is represented by:

      Bruce J. Ruzinsky, Esq.
      JACKSON WALKER L.L.P.
      1401 McKinney, Suite 1900
      Houston, Texas 770 I0
      Tel: (713) 752-4204
      Fax: (713) 481-6262
      E-mail: bruzinsky@jw.com

                         Management Plan

Sonrisa Properties, Ltd., is seeking confirmation of a plan that
proposes to (1) obtain financing from a third party ($4,750,000
from Briar Capital Group) in order to restructure the Compass Bank
indebtedness over a five year term; (2) subordinate the first lien
position of Compass by granting Briar Capital Group a first lien
position in the collateral; and (3) a payout to holders of
undisputed and allowed unsecured claims after payment in full to
Briar Capital Group and Compass.

Pursuant to the Plan, Compass will partially release its lien as
properties are sold and receive $1.30 per square foot for any
property for which a partial release is requested.  100% of net
proceeds remaining from any sale will be first applied to the
Briar Note until the Briar Note is paid in full.

Randal M. Hall, the president of the Debtor's general partner,
will disburse all plan funds.

                     About Sonrisa Properties

League City, Texas-based Sonrisa Properties, Ltd., owns roughly 4
acres of unimproved real property in League City, Galveston
County, Texas located on/near the Gulf Freeway at the FM 646
intersection.  The Company filed for Chapter 11 bankruptcy
protection on January 4, 2010 (Bankr. S.D. Texas Case No. 10-
80012), to stop Compass Bank, the largest secured creditor, from
foreclosing on the property.  Karen R. Emmott, Esq., who has an
office in Houston, Texas, assists the Company in its restructuring
effort.  The Company disclosed $21,098,818 in assets and
$8,420,540 in liabilities as of the Petition Date.


SPECIALTY TRUST: Wants Plan Exclusivity Period Extended to March 4
------------------------------------------------------------------
Specialty Trust, Inc., and its debtor affiliates, ask the U.S.
Bankruptcy Court for the District of Nevada for an extension of
their exclusive right to file a plan for an additional 45 days, or
until March 4, 2011, except as to the committee of equity holders,
as well as an extension of their exclusive right to obtain
acceptances of that plan through and including May 3, 2011, except
as to the Committee.

If the Committee files a plan that is not co-sponsored by the
Debtors, the holder of the Debtors' subordinated notes, Taberna
Preferred Funding VII, Ltd., would also be entitled to file a plan
without further order of the Court.

The Debtor relate that they have been negotiating with all
interested parties with respect to a consensual plan, but that it
would be premature for them to file a plan of reorganization "at
this juncture".

The Court previously extended the exclusive period for the Debtors
to file a plan from August 18, 2010, to October 18, 2010.  On
December 17, 2010, the Court further extended the exclusivity
period for the Debtors to file a plan through January 18, 2011,
except as to the Committee.  As to the Committee only, the
Debtor's exclusivity to file a plan was terminated as of
October 19, 2010.

The hearing on the motion is scheduled for March 2, 2011, at
10:00 a.m.

                       About Specialty Trust

Reno, Nevada-based Specialty Trust, Inc., filed for Chapter 11
bankruptcy protection on April 20, 2010 (Bankr. D. Nev. Case No.
10-51432).  Sallie B. Armstrong, Esq., and Michelle N. Kazmar,
Esq., at Downey Brand LLP, in Reno, Nevada; and Ira D. Kharasch,
Esq., Scotta E. McFarlan, Esq., and Victoria A. Newmark, Esq., at
Pachulski Stang Ziehl & Jones LLP, in Los Angeles, Calif., serve
as the Debtor's bankruptcy counsel.  On May 24, 2010, a committee
of equity holders was appointed.  On September 2, 2010,
the Court appointed Grant Lyon as chief restructuring officer
("CRO") of the Debtors.  In its schedules, the Debtor disclosed
assets of $201,452,048 and liabilities of $109,022,194 as of the
petition date.

On April 20, 2010, affiliates Specialty Acquisition Corp. (Bankr.
D. Nev. Case No. 10-51437) and SAC II (Bankr. D. Nev. Case No.
10-51440) filed separate petitions for Chapter 11 relief.  In its
amended schedules, Specialty Acquisition disclosed assets of
$3,886,113 and liabilities of $49,068,173 as of the petition date.
In its amended schedules, SAC II disclosed assets of $40,955,000
an liabilities of $39,445,118 as of the petition date.


T3 MOTION: Delivers $1MM Unsecured Note to Alfonso/Mercy Cordero
----------------------------------------------------------------
On January 14, 2011, T3 Motion, Inc., delivered a 10% unsecured
promissory note in the principal amount of $1,000,000 that matures
on October 1, 2013, to Alfonso G. Cordero and Mercy B. Cordero.
The Note was dated as of September 30, 2010.  Interest payments of
$8,333.33 are due on the first day of each calendar month
commencing November 1, 2010 and continuing each month thereafter.
The Noteholder subsequently waived payment obligations from
November 1, 2010 through January 1, 2011 and the parties agreed
that accrued interest during that time would be paid at
February 6, 2011.

The Company may prepay the Note, but must prepay in full only.
The Company will be in default under the Note upon: (1) failure to
timely make payment; and (2) failure to perform other agreements
under the Note within 10 days of request from the holder of the
Note.  Upon such event of default, the Holder may declare the Note
immediately due and payable.  The applicable interest rate will be
upon default will be increased to 15% or the maximum rate allowed
by law.

                          About T3 Motion

Costa Mesa, Calif.-based T3 Motion, Inc., develops and
manufactures T3 Series vehicles, which are electric three-wheel
stand-up vehicles that are directly targeted to the public safety
and private security markets.

The Company's balance sheet as of September 30, 2010, showed
$3.81 million in total assets, $16.56 million in total
liabilities, and a stockholders' deficit of $12.75 million.  At
September 30, 2010, the Company has an accumulated deficit of
$40.41 million, a working capital deficit of $14.32 million and a
cash balance of $40,966.

KMJ Corbin & Company LLP, in Costa Mesa, Calif., expressed
substantial doubt about the Company's ability to continue as a
going concern, following the Company's 2009 results.  The
independent auditors noted that the Company has incurred
significant operating losses and had negative cash flows from
operations since inception and at December 31, 2009, has a working
capital deficit of $11.01 million and an accumulated deficit of


TERRESTAR NETWORKS: Committee Joins Sprint Suit vs. U.S. Bank
-------------------------------------------------------------
The Official Committee of Unsecured Creditors in TerreStar
Networks Inc.'s Chapter 11 cases filed an intervenor complaint
against U.S. Bank, in its capacity as Indenture Trustee and
Collateral Agent for the 15.0% Senior Secured Payment-In-Kind
Notes due 2014 issued by Debtor TerreStar Networks Inc.

The Committee's complaint joins the action Sprint Nextel
commenced, which seeks a declaration regarding the priority,
scope, validity and enforceability of any security interests
granted by TSN and certain of its affiliates in licenses,
authorizations, waivers, permits and other related regulatory
approvals granted by the Federal Communications Commission and
the proceeds and value derived from the FCC Licenses.

Pursuant to a security agreement, TSN and its affiliates
purported to grant a security interest in the FCC Licenses and
any proceeds thereof to Defendant U.S. Bank as Collateral Agent
for the Senior Secured Noteholders.

David M. Posner, Esq., at Otterbourg Steindler Houston & Rosen
P.C., in New York, contends that a present, justiciable dispute
exists as to the priority, scope, validity, and enforceability of
the liens purportedly granted by a certain security agreement
between the Debtors and U.S. Bank.   The Security Agreement
purports that the Debtors grant a security interest in the FCC
Licenses and any related proceeds to Defendant U.S. Bank as
collateral agent for the Senior Secured Noteholders.  "Applicable
law prohibits the grant of a security interest in the FCC
Licenses, and any prepetition lien purportedly held by U.S. Bank
or the Senior Secured Noteholders on the proceeds of the FCC
Licenses would not, in any event, attach to any proceeds or value
derived from the FCC Licenses after the filing of the bankruptcy
cases by TSN and its affiliates," Mr. Posner asserts.

In their proposed Chapter 11 Plan of Reorganization, as presently
contemplated, TSN and certain of the affiliated debtors propose
to transfer 97% of the equity of the reorganized Debtor entities
to the Senior Secured Noteholders and only approximately 3% of
the equity to unsecured creditors.  In connection with this, the
TSN Debtors have acknowledged that the S-Band License to use 20
MHz of spectrum in the 2 GHz spectrum band is one of their
critical assets, and the TSN Debtors have valued the S-Band
License at a range of $1.02 billion to $1.28 billion pursuant to
a total reorganization value for purposes of the Plan of
$1.07 billion to $1.37 billion.

The Plan is clearly premised upon the assumption that the Senior
Secured Noteholders have a lien on substantially all of the TSN
Debtors' assets, including the S-Band, Mr. Posner points out.  He
contends that applicable Federal law precludes the Senior Secured
Noteholders from having a valid security interest in the S-Band
License, which is the most valuable asset of the TSN Debtors and
comprises a substantial portion of the total reorganization value
under the Plan.

The unsecured creditors that comprise the constituency
represented by the Committee, Mr. Posner argues, are entitled to
share in the value derived from the unencumbered S-Band License
and should therefore receive substantially more than the
approximate 3% of the equity in the reorganized entity.

Resolution of the present dispute as to the validity and
enforceability of the Senior Secured Noteholders' alleged lien on
the S-Band license and all proceeds thereof and therefrom will
promote judicial economy and the interests of justice, and from
the perspective of the Committee, provide the legal and equitable
basis to establish the competing priority of claims to the assets
of certain of the TSN Debtors' estates in these bankruptcy cases,
Mr. Posner tells Judge Lane.

                   U.S. Bank Answers Complaint

U.S. Bank, through its counsel, Franklin Ciaccio, Esq., at Carter
Ledyard & Milburn LLP, in New York, filed an answer to Sprint
Nextel's complaint generally denying all allegations.

U.S. Bank generally asserts that it doesn't have knowledge or
information sufficient to form a belief as to the truth of Sprint
Nextel's allegations.

The Debtors and the Ad Hoc Noteholder Group filed separate
joinders to U.S. Bank's answer.

                     About TerreStar Networks

Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.

TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices.  This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure.  The
Company intends to provide multiple communications applications,
including voice, data and video services.

As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc.  Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.

TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).

The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.

Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq., at
Fraser Milner Casgrain LLP and Ira Dizengoff, Esq., Arik Preis,
Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer &
Feld LLP, serve as bankruptcy counsel to the Debtors.  Blackstone
Advisory Partners LP is the financial advisor.  The Garden City
Group, Inc., is the claims and noticing agent in the Chapter 11
cases.  Otterbourg Steindler Houston & Rosen P.C. is the counsel
to the Official Committee of Unsecured Creditors.  FTI Consulting,
Inc., is the Committee's financial advisor

Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


TERRESTAR NETWORKS: Creditors Committee Sues U.S. Bank
------------------------------------------------------
The Official Committee of Unsecured Creditors in TerreStar
Networks Inc.'s Chapter 11 cases has commenced an adversary
complaint against U.S. Bank National Association, in the bank's
capacity as Indenture Trustee and Collateral Agent for the 15.0%
Senior Secured Payment-In-Kind Notes due 2014 issued by Debtor
TerreStar Networks Inc.

Under the Complaint, the Creditors Committee seeks to avoid an
alleged security interest claimed by U.S. Bank in the certain
assets of TSN consisting of and relating to TSN's interest in
TerreStar-2, the Debtors' ground spare satellite under
construction at Space Systems/Loral, Inc.

David M. Posner, Esq., at Otterbourg, Steindler, Houston & Rosen,
P.C., in New York, relates that pursuant to a security agreement
among TSN, as issuer, and TerreStar National Services, Inc. and
TerreStar License Inc., as guarantors, in favor of U.S. Bank, as
Collateral Agent for the holders of the Senior Secured Notes,
TSN, TerreStar National Services, Inc. and TerreStar License Inc.
purported to grant a lien upon certain of their assets.  The
Security Agreement provides that the Indenture Trustee has a lien
on all personal property of the Debtors other than "Excluded
Property," which includes any property or assets subject to a
"Permitted Lien."  The Permitted Liens include liens related to
the issuance of purchase money indebtedness incurred to finance
the procurement, construction and launch of one or more
satellites or ground-based beam-forming earth stations in an
amount at any time outstanding not to exceed $100 million.

Mr. Posner notes that upon information and belief, provisions of
the Indenture and Security Agreement were intended to exclude
TSN's interest in TS-2 from the collateral pool of the Senior
Secured Noteholders until a time as a certain purchase money
indebtedness is paid in full.

A $100 million Purchase Money Credit Agreement was entered into
by TSN, as borrower, U.S. Bank, as collateral agent, and
Harbinger Capital Partners LLC and EchoStar Corporation, as the
original lenders, following the execution of the Indenture.
Pursuant to the terms of the PMCA, monies were advanced as
required to fund SS/L's construction of TS-2.  A first lien on
all of TSN's rights in TS-2, along with TSN's interest in raw
materials, work-in-process, construction agreement, insurance,
books and records and all related proceeds secured the PMCA.

Accordingly, pursuant to the terms of the Security Agreement,
from February 5, 2008, onwards, TSN's interest in TS-2 and the
TS-2 Related Assets constituted Excluded Property and therefore
were "carved out" of the collateral pool securing the Senior
Secured Notes because all of TSN's interest in TS-2 and the TS-2
Related Assets were pledged to secure the PMCA, Mr. Posner
asserts.

Notwithstanding the fact that TSN's interest in TS-2 and the
TS-2 Related Assets had already been carved out of the collateral
pool securing the Senior Secured Notes by the express terms the
Security Agreement as originally entered into on March 24, 2008,
U.S. Bank filed a UCC-3 Amendment with the Delaware Department of
State that specifically terminated whatever security interest
that U.S. Bank might claim to have in TSN's interest in TS-2 and
the TS-2 Related Assets, Mr. Posner tells Judge Lane.  He adds
that the U.S. Bank UCC-3 did not contain any conditional release,
or "springing lien," that would limit the purpose of such filing.

Mr. Posner further contends that even if the PMCA were to be paid
in full and its lien with respect to TSN's interest in TS-2 and
TS-2 Related Assets released, any security interest in those
assets claimed by U.S. Bank would remain unperfected because the
UCC-1 financing statement originally filed by U.S. Bank with the
Delaware Secretary of State in 2007 was effectively negated as to
TSN's interest in TS-2 and the TS-2 Related Assets by U.S. Bank's
filing of the U.S. Bank UCC-3 on or about March 24, 2008.

Subsequently, the Debtors filed for Chapter 11 protection in
October 2010 and obtained a debtor-in-possession financing, which
included a stipulation that U.S. Bank has a perfected security
interest in the "Collateral," as the term is defined in the
Indenture.

Representing the Creditors Committee, Mr. Posner argues that
TSN's interest in TS-2 and the IS-2 Related Assets did not
constitute "Collateral" for the Senior Secured Notes since by
reason of an unpaid balance remaining with respect to the PMCA.
"Those assets continued to constitute Excluded Property
specifically carved out from U.S. Bank's collateral pool by the
Security Agreement," he maintains.

Mr. Posner also points out that under the TSN Debtors' Fourth
Amended Disclosure Statement for the Joint Chapter 11 Plan, the
TSN Debtors acknowledged that "there is a litigable issue as to
whether the holders of the Senior Secured Notes have a lien on
the TSN's rights in TerreStar-2."

TSN has not assumed the Amended and Restated Contract for
TerreStar-2 dated December 12, 2007, which governs the
construction of TS-2, Mr. Posner reveals.  He adds that upon
information and belief, U.S. Bank has claimed that its Alleged
Interest in TSN's interest in TS-2, the TS-2 Related Assets and
all related proceeds that it claims on behalf of, and as agent
for, the Senior Secured Noteholders, are valid and enforceable
security interests.

The Creditors Committee disputes the validity and enforceability
of any liens on TSN's interest in TS-2 and the TS-2 Related
Assets and proceeds purportedly granted to U.S. Bank as
Collateral Agent for the Senior Secured Noteholders.

The recoveries to be realized by the Committee's unsecured
creditor constituency stands to be increased significantly if the
liens on TSN's interest in TS-2 and the TS-2 Related Assets or
the related proceeds claimed by the Senior Secured Noteholders
are either (i) declared to be invalid; (ii) if deemed at one time
to have been valid, then declared to have been released; or
(iii) avoided as unperfected under the Committee's present
complaint, Mr. Posner emphasizes.

Mr. Posner thus contends that a present and justifiable dispute
exists as to the scope, validity and enforceability of the
Alleged Interest in TSN's interest in TS-2, the TS-2 Related
Assets and all related proceeds, and that the dispute must be
decided either prior to, or contemporaneously with, issues
related to confirmation of the TSN Debtors' Plan.  He further
points out that a complete and final determination of whether
liens purportedly granted by the Security Agreement to secure the
obligations owed by the Debtors on account of the Senior Secured
Notes extend to and encumber TSN's rights in TS-2 and the TS-2
Related Assets is not readily obtainable in another form of
action or proceeding.

"Accordingly, any declaration by [the Bankruptcy] Court that such
assets are not encumbered by the liens granted to U.S. Bank under
the Security Agreement will not constitute an advisory opinion,"
Mr. Posner says.

A pre-trial conference with respect to the adversary complaint
has been set for March 8, 2011, at 10:00 a.m.

                     About TerreStar Networks

Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.

TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices.  This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure.  The
Company intends to provide multiple communications applications,
including voice, data and video services.

As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc.  Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.

TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).

The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.

Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq., at
Fraser Milner Casgrain LLP and Ira Dizengoff, Esq., Arik Preis,
Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer &
Feld LLP, serve as bankruptcy counsel to the Debtors.  Blackstone
Advisory Partners LP is the financial advisor.  The Garden City
Group, Inc., is the claims and noticing agent in the Chapter 11
cases.  Otterbourg Steindler Houston & Rosen P.C. is the counsel
to the Official Committee of Unsecured Creditors.  FTI Consulting,
Inc., is the Committee's financial advisor

Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


TERRESTAR NETWORKS: Sprint Nextel Defends Claims
------------------------------------------------
As reported in the Jan. 3, 2011 edition of the Troubled Company
Reporter, TerreStar Networks Inc. and its units seek the entry of
a Bankruptcy Court order expunging, disallowing, or reducing
Sprint Nextel Corporation's Claim Nos. 49 through 52, 66 through
70, and 79 through 82.  Ira S. Dizengoff, Esq., at Akin Gump
Strauss Hauer & Feld LLP, in New York, contends that by filing
identical claims aggregating more than $104 million against each
of the TSN Debtors, Sprint Nextel opportunistically and
inequitably is attempting to turn the bankruptcy claims process
"on its head and create claims that did not previously exist,
either legally or factually."

In response, the basic facts underlying the claims asserted by
Sprint Nextel Corporation are not in dispute, Eric T. Moser, Esq.,
at K&L Gates LLP, in New York, relates.  He points out that the
Debtors do not dispute that Sprint Nextel has completely cleared
the spectrum band licensed by the Debtors, thereby making the
spectrum available for the Debtors to provide mobile satellite
services.

Mr. Moser notes that the Debtors' omnibus objection to Sprint
Nextel's claims can be reduced to two issues: (1) Which Debtor
entities are liable for the amount owed to Sprint Nextel; and (2)
What is the amount owed.  On the first issue, the Debtors contend
that the only debtor entities liable for the reimbursement
obligation are TerreStar Networks Inc.; TerreStar License Inc.;
and TerreStar National Services Inc.  On the second issue, the
Debtors contend that Sprint Nextel has failed to provide
sufficient information to validate its claim, and in violation of
the applicable regulatory scheme, failed to identify what amount
they admit owing.

The resolution of both issues, Mr. Moser relates, is controlled
by the order entered by the Federal Communications Commission on
September 29, 2010, resolving a number of issues regarding the
reimbursement obligations of MSS providers.  He elaborates that
among other things, the 2010 Declaratory Ruling clarified that
each corporate affiliate that comprises an integrated MSS
enterprise is liable for any reimbursement obligation owed to
Sprint Nextel.

The Debtors have repeatedly represented and admitted that they
collectively comprise a single MSS enterprise, Sprint Nextel
notes.  The integrated nature of the Debtors' operations is
demonstrated by the fact that they have structured their
operations so that various Debtor entities hold different assets
and provide different services, each of which is necessary for
the operation of the Debtors' network.  "Based on their own self-
description and their operational structure, the Debtors
constitute an integrated MSS enterprise, and each Debtor entity
involved in that structure is jointly and severally liable for
the reimbursement obligation owed to Sprint Nextel," Mr. Moser
contends.

On behalf of Sprint Nextel, Mr. Moser asserts that the arguments
presented by the Debtors in their objection to avoid joint and
several liability to Sprint Nextel's claims are weak and
unpersuasive for these reasons:

  1. No legal support exists for the Debtors' argument that it
     is inequitable for Sprint Nextel to assert claims against
     each of the Debtors.  The equitable doctrine of "laches"
     does not apply because Sprint is not seeking an equitable
     remedy, rather, Sprint is seeking monetary damages and the
     statute of limitations for Sprint to assert its claims has
     not expired.

     Mr. Moser notes that the facts demonstrate that Sprint
     Nextel has not delayed in asserting its claims and that the
     Debtors have not suffered any prejudice that would support
     an equitable defense, even if it were to apply.

  2. The Debtors misread the 2010 Declaratory Ruling and ignored
     its plain terms by arguing from the premise that the order
     never uses the term "joint and several liability."  The
     2010 Declaratory Ruling states that the FCC intended to
     clarify when multiple affiliates would be subject to
     "enterprise liability."

     Enterprise liability is a legal doctrine that imposes joint
     and several liability and therefore, there was no need for
     the FCC to use the phrase "joint and several liability,"
     Mr. Mosner relates.

  3. The 2010 Declaratory Ruling did not state that only the
     nominal licensee, like the license-holding entity, and its
     corporate parent are subject to enterprise liability.  The
     history of the FCC proceedings and the language of the 2010
     Declaratory Ruling itself demonstrate that all corporate
     affiliates that comprise an integrated MSS enterprise are
     jointly and severally liable for the reimbursement
     obligation.

  4. The Debtors ignored their regulatory history and
     operational structure when they asserted that TerreStar
     Canada and 0887729 B.C. Ltd are not part of the Debtors'
     integrated MSS enterprise because they are Canadian
     entities with no operations in the United States.  The S-
     Band License held by TLI was issued with several
     conditions, including (i) the requirement that the Debtors
     obtain an appropriate license from Industry Canada for the
     operation of the Debtors' satellite and (ii) the
     requirement that the Debtors certify that they own an
     operational satellite by a certain deadline.  Thus, for
     regulatory purposes, the Debtors' U.S. operations are
     integrated with the Canadian operations.  Without the
     licenses and assets held by the TerreStar Canada and 088,
     there would be no domestic operations because the Debtors
     would never have been able to satisfy the conditions
     imposed by the FCC upon the issuance of the S-Band License,
     Mr. Moser asserts.

For these reasons, Sprint Nextel asks the Court to reject the
Debtors' arguments and find that each of the Debtors is jointly
and severally liable for the reimbursement obligation owed to it.

With respect to the amount of the claims, Mr. Moser asserts that
the 2010 Declaratory Ruling imposes a strict burden of proof and
production on both Sprint Nextel and the Debtors.  He maintains
that once Sprint Nextel satisfies its burden of production, the
Debtors cannot challenge the amount owed unless they provide (i)
an independent estimate of what they believe the costs to be, and
(ii) evidentiary support for that estimate.  Mr. Moser points the
Court to the detail that the Debtors never stated in their Claim
Objection what they believe the correct amount of the claim to
be, nor did they provide any evidence to challenge the amount
claims by Sprint Nextel.  Instead, the Debtors contended that
Sprint Nextel has not provided the information required by the
2010 Declaratory Ruling, Mr. Moser cites.

Sprint Nextel has complied with the order by providing a detailed
statement showing a calculation of the amount owed, audit
statements to verify the claimed amounts, and copies of the
various frequency relocation agreements that were executed in
connection with the band-clearing efforts, Mr. Moser reminds
Judge Lane.

Accordingly, because the Debtors have not provided any
evidentiary support to demonstrate that the amount claimed by
Sprint Nextel is incorrect, there is no basis to reduce the
amount claimed by Sprint Nextel, Mr. Moser asserts.

For each of these reasons, Sprint Nextel asks Judge Lane to
overrule the Debtors' Omnibus Objection and allow its claims in
full.

                     About TerreStar Networks

Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.

TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices.  This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure.  The
Company intends to provide multiple communications applications,
including voice, data and video services.

As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc.  Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.

TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).

The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.

Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq., at
Fraser Milner Casgrain LLP and Ira Dizengoff, Esq., Arik Preis,
Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer &
Feld LLP, serve as bankruptcy counsel to the Debtors.  Blackstone
Advisory Partners LP is the financial advisor.  The Garden City
Group, Inc., is the claims and noticing agent in the Chapter 11
cases.  Otterbourg Steindler Houston & Rosen P.C. is the counsel
to the Official Committee of Unsecured Creditors.  FTI Consulting,
Inc., is the Committee's financial advisor

Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


TERRESTAR NETWORKS: Wants Until May 17 to Decide on Leases
----------------------------------------------------------
TerreStar Networks, Inc., and its debtor affiliates ask the United
States Bankruptcy Court for the Southern District of New York to
extend the time within which they must assume or reject unexpired
non-residential real property leases pursuant to Section
365(d)(4) of the Bankruptcy Code to the earlier of:

  (i) the date an order is entered confirming a Chapter 11 plan
      in the Debtors' bankruptcy case, or

(ii) an additional 90 days through and including May 17, 2011.

Section 365(d)(4) provides that an unexpired non-residential real
property lease under which a debtor is the lessee will be deemed
rejected and will immediately be surrendered to the lessor, if
the trustee does not assume or reject the unexpired lease by the
earlier of (i) the date that is 120 days after a debtor filed for
bankruptcy protection, or (ii) the date of the entry of an order
confirming a plan in that debtor's case.  The court may extend
the lease decision period prior to the expiration of the 120-day
period for 90 days on the motion of the trustee or lessor for
cause.

The Debtors' current lease decision deadline is February 16,
2011.

The Debtors are parties to more than 40 non-residential real
property leases that have not already been the subject of a
notice of assumption or rejection in their Chapter 11 cases.  The
Unexpired Leases include headquarters leases, general office
space leases, leases underlying the Debtors' ground operations
including, two Gateway Earth Stations, the Debtors' 15
calibration earth stations located throughout the United States,
and five CES located throughout Canada.

Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
New York, tells the Court that a significant number of the
Unexpired Leases are critical to the operation of the Debtors'
core business functions because many of the Debtors' business
operations are located at leased facilities or on premises that
are subject to certain of the Unexpired Leases.

Since the Petition Date, much of the Debtors' time has been
devoted to significant and exigent matters, Mr. Dizengoff
relates.  He notes that the Debtors have been called upon to
respond to myriad complex issues to ensure the continued
viability of their businesses.

Mr. Dizengoff also tells the Court that the Debtors' executive
management is presently working, in consultation with their
restructuring advisors, to make determinations regarding
assumption and rejection of all of their executory contracts and
unexpired leases.  Thus, the review and assessment process for
the Debtors' Unexpired Leases is in progress, but forcing a
premature decision about assumption or rejection could have a
detrimental impact on the Debtors' operations and estates, he
maintains.

"Notwithstanding the challenges faced in these cases to date, the
Debtors have a proven resolve to work tirelessly toward a
successful and rapid reorganization, an important component of
which is optimizing their strategic choices in respect of their
numerous Unexpired Leases," Mr. Dizengoff says.  He notes that
"as a result, however, the Debtors have not yet had sufficient
time to complete a review and analysis of individual leases."

Despite the many competing demands, the Debtors are in the
process of evaluating their non-residential real property lease
portfolio and have already rejected several leases that were no
longer beneficial to the Debtors' businesses, Mr. Dizengoff
reveals.  He asserts that the proposed extension will provide the
Debtors with the critical additional time needed to complete the
process.

The Court is set to consider the Debtors' request on February 1,
2011, at 12:30 p.m.  The objection deadline is set on the same
date at 12:00 p.m.

                     About TerreStar Networks

Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.

TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices.  This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure.  The
Company intends to provide multiple communications applications,
including voice, data and video services.

As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc.  Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.

TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).

The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.

Michel Wunder, Esq., Ryan Jacobs, Esq., and Jarvis Hetu, Esq., at
Fraser Milner Casgrain LLP and Ira Dizengoff, Esq., Arik Preis,
Esq., and Ashleigh Blaylock, Esq., at Akin Gump Strauss Hauer &
Feld LLP, serve as bankruptcy counsel to the Debtors.  Blackstone
Advisory Partners LP is the financial advisor.  The Garden City
Group, Inc., is the claims and noticing agent in the Chapter 11
cases.  Otterbourg Steindler Houston & Rosen P.C. is the counsel
to the Official Committee of Unsecured Creditors.  FTI Consulting,
Inc., is the Committee's financial advisor

Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


TIG, LLC: Case Summary & 2 Largest Unsecured Creditors
------------------------------------------------------
Debtor: TIG, LLC
          fdba Downtown Loft Developers, LLC
        P.O. Box 630006
        Hollywood, FL 33021

Bankruptcy Case No.: 11-11650

Chapter 11 Petition Date: January 24, 2011

Court: U.S. Bankruptcy Court
       Southern District of Florida (Fort Lauderdale)

Judge: Raymond B. Ray

Debtor's Counsel: Richard R. Robles, Esq.
                  LAW OFFICES OF RICHARD R. ROBLES, P.A.
                  905 Brickell Bay Drive, #228
                  Miami, FL 33131
                  Tel: (305) 755-9200
                  E-mail: rrobles@roblespa.com

Estimated Assets: $50,001 to $100,000

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/flsb11-11650.pdf

The petition was signed by Zusia Tenenbaum, managing member.


TRIBUNE LTD: S&P Lowers Ratings on Notes to 'D' From 'CCC-'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the notes
from Tribune Ltd.'s series 44, a synthetic collateralized debt
obligation (CDO) transaction, to 'D (sf)' from 'CCC- (sf)'.

The downgrade follows credit events in the underlying portfolio
that resulted in the notes incurring a full principal loss.

Rating Lowered

Tribune Ltd.
US$45 mil Tribune Limited Series 44

                Rating
Class         To      From
Tranche       D (sf)  CCC- (sf)


USG CORP: Subsidiary Closes Gypsum Rock Quarry Facilities
---------------------------------------------------------
As part of USG Corporation's steps to adjust operations and
staffing to market conditions, the Company's subsidiary, CGC Inc.,
is temporarily closing its gypsum rock quarry facilities in
Windsor, Nova Scotia, Canada, effective February 28, 2011.

The Company will record charges of approximately $16 million
related to the closure of the quarry facilities in the fourth
quarter of 2010.  These charges include approximately $5 million
for employee termination benefits, $9 million for contractual
obligations and $2 million for asset write-offs.  The Company
estimates that it will incur cash expenditures of approximately
$15 million in 2011 and later periods in connection with the
closure.

                          About USG Corp.

USG Corporation, headquartered in Chicago, Illinois, is a leading
producer and distributor of building materials in the Unites
States, Canada and Mexico.  The company manufactures and markets
gypsum wallboard and operates a specialty distribution business
that sells to professional contractors.  It also manufactures
ceiling tiles and ceiling grids used primarily in commercial
applications.  Revenues for the last 12 months through March 31,
2010, totaled approximately $3.1 billion.

                           *     *     *

As reported by the Troubled Company Reporter on November 8, 2010,
Moody's Investors Service assigned a B2 rating to USG
Corporation's new senior unsecured notes, and affirmed its Caa1
Corporate Family Rating and Caa1 Probability of Default Rating.
USG's speculative grade liquidity rating remains SGL-3.  The
outlook is stable.

The Caa1 Corporate Family Rating results from weak operating
performance.  Low capacity utilization rates of approximately 45%
at its gypsum manufacturing facilities make it difficult for USG
to overcome its high fixed costs.  Moody's projects that potential
demand increases for wallboard from North American new home
construction and repair and remodeling will not be adequate to
generate sufficient volumes and operating profits to cover USG's
interest expense over the intermediate term.  Furthermore, the
non-residential construction end market, which accounts for about
30% of USG's revenues, is expected to face stagnant growth well
into 2011.  The amount of profits derived from the company's
worldwide ceilings business is not enough to make up shortfalls in
the gypsum and distribution businesses.  For the last twelve
months through September 30, 2010, operating margins remain
substandard at negative 4.9% and leverage is very high at debt-to-
EBITDA of 27.2 times.  The company's inability to generate
positive earnings will result in very weak credit metrics for the
foreseeable future and will require cash to fund operating
shortfalls.


UNITED CONTINENTAL: PAR Entities Have 4.7% Equity Stake
-------------------------------------------------------
In an amended Schedule 13G filing with the Securities and Exchange
Commission on January 21, 2011, each of PAR Investment Partners,
L.P., PAR Group, L.P. and PAR Capital Management, Inc., disclosed
beneficially ownership of 15,011,990 shares of common stock of UAL
Corporation representing 4.7% of the shares outstanding.  As of
October 18, 2010, there were 317,071,876 shares of United
Continental Holdings, Inc. common stock outstanding.

                      About United Continental

United Continental Holdings, Inc. (NYSE: UAL) --
http://www.UnitedContinentalHoldings.com/, http://www.united.com/
and http://www.continental.com/-- is the holding company for both
United Airlines and Continental Airlines.  Together with United
Express, Continental Express and Continental Connection, these
airlines operate a total of approximately 5,800 flights a day to
371 airports throughout the Americas, Europe and Asia from their
hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles,
New York, San Francisco, Tokyo and Washington, D.C.  United and
Continental are members of Star Alliance, which offers more than
21,200 daily flights to 1,172 airports in 181 countries worldwide
through its 28 member airlines. United's and Continental's more
than 80,000 employees reside in every U.S. state and in many
countries around the world.

United Continental carries 'B2' corporate family and probability
of default ratings, with stable outlook, from Moody's, 'B' issuer
credit ratings, with stable outlook, from Standard & Poor's, and
'B-' issuer default rating from Fitch.

UAL Corp filed for Chapter 11 protection on Dec. 9, 2002 (Bankr.
N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen, Esq., Marc
Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba,
Esq., at Kirkland & Ellis, represented the Debtors in their
restructuring efforts.  Fruman Jacobson, Esq., at Sonnenschein
Nath & Rosenthal LLP represented the Official Committee of
Unsecured Creditors.  Judge Eugene R. Wedoff confirmed a
reorganization plan for United on Jan. 20, 2006.  The Company
emerged from bankruptcy on Feb. 1, 2006.

At June 30, 2010, UAL had $20.134 billion in total assets against
total current liabilities of $8.573 billion, long-term debt of
$6.281 billion, long-term obligations under capital leases of
$1.01 billion, other liabilities and deferred credits of
$7.022 billion, and a stockholders' deficit of $2.756 billion.


VITRO SAB: Agrees to Dismiss Chapter 15 Petition
------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Vitro SAB agreed to dismiss the Chapter 15 petition
it filed in New York in mid-December, according to a document
submitted January 24 to the U.S. Bankruptcy Court in Fort Worth,
Texas, where bondholders filed involuntary Chapter 11 petitions a
month earlier against Vitro's U.S. subsidiaries.

According to Mr. Rochelle, Vitro was forced into dismissing the
Chapter 15 case following a ruling from a court in Mexico this
month dismissing Vitro's attempted reorganization under that
country's version of Chapter 11.

Mr. Rochelle notes that a Chapter 15 case is exclusively to
provide support for a bankruptcy case pending abroad.  When the
Mexican case was dismissed, the necessary predicate for the
Chapter 15 petition in New York evaporated.  Vitro is appealing
the ruling by the judge in Mexico.

                           About Vitro SAB

Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global
glass producer, serving the construction and automotive glass
markets and glass containers needs of the food, beverage, wine,
liquor, cosmetics and pharmaceutical industries.

Vitro is the largest manufacturer of glass containers and flat
glass in Mexico, with consolidated net sales in 2009 of
MXN23,991 million (US$1.837 billion).

Vitro defaulted on its debt in 2009, and is now seeking to
restructure around US$1.5 billion in debt, including US$1.2
billion in notes.

Vitro launched an offer to buy back or swap US$1.2 billion in debt
from bondholders.  The tender offer would be consummated with a
bankruptcy filing in Mexico and Chapter 15 filing in the United
States.  Vitro said noteholders would recover as much as 73% by
exchanging existing debt for cash, new debt or convertible bonds.
The offer was to expire December 7.

Noteholders who oppose the exchange, namely Knighthead Master
Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson
Kempner Distressed Opportunities Fund LP, and Brookville Horizons
Fund, L.P. -- which hold US$75 million, or approximately 6% of the
outstanding bond debt -- commenced involuntary bankruptcy cases
under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset
Corp. (Bankr. N.D. Tex. Case No. 10-47470) and nine other
affiliates on November 17, 2010.

Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation
Counsel to analyze the potential rights that Vitro may exercise in
the United States against the ad hoc group of dissident
bondholders and its advisors.

A larger group of noteholders, known as the Ad Hoc Group of Vitro
Noteholders -- comprised of holders, or investment advisors to
holders, which represent approximately US$650 million of the
Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not
among the Chapter 11 petitioners, although the group has expressed
concerns over the exchange offer.  The group says the exchange
offer exposes Noteholders who consent to potential adverse
consequences that have not been disclosed by Vitro.  The group is
represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at
White & Case LLP.

The U.S. affiliates subject to the involuntary petitions are Vitro
Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10-
47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473);
Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super
Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky
International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP
Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco
Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O.
Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger
Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa
Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance
Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass,
Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC
(Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC
(Bankr. N.D. Tex. Case No. 10-47485).

Vitro SAB on December 13, 2010, filed its voluntary petition for a
pre-packaged Concurso Plan in the Federal District Court for Civil
and Labor Matters for the State of Nuevo Leon, thereby commencing
its voluntary concurso mercantil proceedings.  Vitro SAB believes
that, as a result of the implementation of the Concurso Plan
through the Mexican Proceeding, the holders of the Restructured
Debt will recover 68% to 75% of the face value of their respective
claims.

Vitro SAB also commenced parallel proceedings under Chapter 15 of
the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in
Manhattan on December 13, 2010, to seek U.S. recognition and
deference to its bankruptcy proceedings in Mexico.

Alejandro Francisco Sanchez-Mujica, as foreign representative of
Vitro, has asked the U.S. Bankruptcy Court to enter an order
recognizing the Mexican Proceeding as "foreign main proceeding"
pursuant to 11 U.S.C. Secs. 1515 and 1517.

Early in January 2011, the Mexican Court dismissed the Concurso
Mercantil proceedings.


VITRO SAB: Appeals Plan Dismissal in Mexico
-------------------------------------------
Carlos Manuel Rodriguez and Thomas Black at Bloomberg News report
that Vitro, S.A.B. de C.V. Chief Executive Officer Hugo Lara said
the company filed an appeal in Mexican court to challenge a ruling
dismissing the company's voluntary bankruptcy petition.

According to Bloomberg, Mr. Lara said the appeal should be decided
in one to three months.  It was legal to use US$1.9 billion of
intercompany debt to gain majority support for a debt plan that
was rejected by third-party creditors, he added.

As reported in the Troubled Company Reporter-Latin America on
January 12, 2011, Bloomberg News said that Vitro SAB said that a
Mexican judge rejected a bankruptcy plan the company filed in a
Monterrey court.  The company plans to appeal the judge's decision
to dismiss the petition for bankruptcy, Vitro said in an e-mailed
statement obtained by the news agency.

Bloomberg says that following the ruling, the company agreed to
withdraw its related bankruptcy petition in a New York court,
according to a court document filed on January 24, 2011.

      Vitro Refused to Meet with Noteholders, Says Group

The Ad Hoc Group of Vitro Noteholders on January 21 released a
statement to provide the following details and clarifications in
connection with Vitro SAB's restructuring process:

a) Contrary to Vitro's statement that it sought an agreement with
   all of its creditors, despite being directly informed that the
   Ad Hoc Group of Vitro Noteholders, which collectively own more
   than $735 million of Vitro's $1.2 billion of outstanding Senior
   Notes, opposes the Company's plan, Vitro has refused to even
   meet with the Ad Hoc Group of Vitro Noteholders, much less
   attempt to reach agreement with its members.  The Senior Notes
   have been in payment default for nearly two years and more than
   $300 million in aggregate past-due interest is owed by Vitro.

b) Contrary to Vitro's allegation that its plan is opposed only by
   a small  "minority" of noteholders, the plan has in fact been
   rejected (and is opposed) by  the Ad Hoc Group of Vitro
   Noteholders, which collectively own more than 60% of
   outstanding Senior Notes and approximately 50% of Vitro's total
   third-party unsecured debt.

c) Contrary to the allegations of Vitro regarding the reasons its
   plan has been rejected, the Ad Hoc Group of Vitro Noteholders
   has unanimously rejected Vitro's proposal, because the offer
   represents an unacceptably poor economic return to Noteholders
   that is inconsistent with the Company's financial capabilities,
   it improperly leaves the current shareholders unimpaired, and
   has been crafted solely between Vitro and certain affiliated
   parties in a direct attempt to transfer value away from third-
   party creditors.

d) In an attempt to overcome the fact that its consent
   solicitation has received support from only 10% of Vitro's
   third-party creditors that were solicited, Vitro is relying on
   the support of (i) an affiliated party who has been induced to
   accept the consent solicitation with patently preferential
   transfers and other special consideration and (ii) $1.9 billion
   of purported intercompany claims controlled by direct and
   indirect subsidiaries of Vitro and which may have recently been
   manufactured to cram down the offer on non-consenting third-
   party creditors.

e) Contrary to the allegations of Vitro regarding improper
   participation in Vitro's concurso proceeding, the Ad Hoc Group
   of Vitro Noteholders and its members have not participated in
   Vitro's pre-pack concurso in any form or fashion.  The
   dismissal of the pre-pack concurso is only attributable to the
   procedural and substantive decisions made by the Company for an
   improper purpose.  Specifically, the Mexican Court has
   referenced that the Company cannot use the $1.9 billion of
   intercompany claims to declare its pre-pack concurso effective
   and that the holders of intercompany claims are not creditors
   within the meaning of the concurso law.  Also, Vitro failed to
   disclose that the Noteholders have commenced involuntary
   concurso cases against Vitro and certain of its subsidiaries
   which have not been dismissed and remain pending before the
   Mexican Court.

f) Contrary to the allegations of Vitro that the efforts of the Ad
   Hoc Group of Vitro Noteholders put Vitro's business and
   employees at risk, any jeopardy to Vitro's business or
   employees has been caused solely by Vitro's shareholders'
   efforts to improperly retain their full ownership and control
   of the Company without providing a full recovery to creditors.
   The Ad Hoc Group of Vitro Noteholders cannot be faulted for
   merely trying to protect their rights as creditors.

h) The Ad Hoc Group of Vitro Noteholders remains open to a
   negotiated settlement, so long as the consideration is
   consistent with the economic capabilities of Vitro and treats
   creditors according to their respective rankings and
   priorities.

The Ad Hoc Group's statement was signed by

   JAIME R. GUERRA GONZALEZ, ESQ.
   Jesus Angel Guerra Mendez, esq.

   c/o:

   WHITE & CASE LLP, Esq.
   John Cunningham
   Phone: (305) 995-5252
   E-mail: JCunningham@whitecase.com
   Richard Kebrdle
   Phone: (305) 995-5276
   E-mail: RKebrdle@whitecase.com

   CHANIN CAPITAL PARTNERS LLC
   Brian Cullen
   Phone: (310) 445-4010
   E-mail: BCullen@chanin.com
   Mark Catania
   Phone: (310) 445-4010
   E-mail: MCatania@chanin.com

                         About Vitro SAB

Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global
glass producer, serving the construction and automotive glass
markets and glass containers needs of the food, beverage, wine,
liquor, cosmetics and pharmaceutical industries.

Vitro is the largest manufacturer of glass containers and flat
glass in Mexico, with consolidated net sales in 2009 of
MXN23,991 million (US$1.837 billion).

Vitro defaulted on its debt in 2009, and is now seeking to
restructure around US$1.5 billion in debt, including US$1.2
billion in notes.

Vitro launched an offer to buy back or swap US$1.2 billion in debt
from bondholders.  The tender offer would be consummated with a
bankruptcy filing in Mexico and Chapter 15 filing in the United
States.  Vitro said noteholders would recover as much as 73% by
exchanging existing debt for cash, new debt or convertible bonds.
The offer was to expire December 7.

Noteholders who oppose the exchange, namely Knighthead Master
Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson
Kempner Distressed Opportunities Fund LP, and Brookville Horizons
Fund, L.P. -- which hold US$75 million, or approximately 6% of the
outstanding bond debt -- commenced involuntary bankruptcy cases
under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset
Corp. (Bankr. N.D. Tex. Case No. 10-47470) and nine other
affiliates on November 17, 2010.

Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation
Counsel to analyze the potential rights that Vitro may exercise in
the United States against the ad hoc group of dissident
bondholders and its advisors.

A larger group of noteholders, known as the Ad Hoc Group of Vitro
Noteholders -- comprised of holders, or investment advisors to
holders, which represent approximately US$650 million of the
Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not
among the Chapter 11 petitioners, although the group has expressed
concerns over the exchange offer.  The group says the exchange
offer exposes Noteholders who consent to potential adverse
consequences that have not been disclosed by Vitro.  The group is
represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at
White & Case LLP.

The U.S. affiliates subject to the involuntary petitions are Vitro
Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10-
47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473);
Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super
Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky
International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP
Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco
Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O.
Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger
Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa
Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance
Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass,
Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC
(Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC
(Bankr. N.D. Tex. Case No. 10-47485).

Vitro SAB on December 13, 2010, filed its voluntary petition for a
pre-packaged Concurso Plan in the Federal District Court for Civil
and Labor Matters for the State of Nuevo Leon, thereby commencing
its voluntary concurso mercantil proceedings.  Vitro SAB believes
that, as a result of the implementation of the Concurso Plan
through the Mexican Proceeding, the holders of the Restructured
Debt will recover 68% to 75% of the face value of their respective
claims.

Vitro SAB also commenced parallel proceedings under Chapter 15 of
the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in
Manhattan on December 13, 2010, to seek U.S. recognition and
deference to its bankruptcy proceedings in Mexico.

Alejandro Francisco Sanchez-Mujica, as foreign representative of
Vitro, has asked the U.S. Bankruptcy Court to enter an order
recognizing the Mexican Proceeding as "foreign main proceeding"
pursuant to 11 U.S.C. Secs. 1515 and 1517.

Early in January 2011, the Mexican Court dismissed the Concurso
Mercantil proceedings.



WARNER MUSIC: Paris Court Finds CEO Guilty in Vivendi Lawsuit
-------------------------------------------------------------
Warner Music Group Corp. announced that the Trial Court in Paris
has found Edgar Bronfman, Jr., the company's Chairman and CEO,
guilty of the previously disclosed charge relating to certain
trades he made in the stock of Vivendi Universal in 2002.  As a
result of its finding, the Court imposed a fine on Mr. Bronfman
and a suspended sentence.

Mr. Bronfman has informed the company that he intends to appeal
the trial court's decision to the Paris Court of Appeal.  Under
French law, the fine is suspended, pending the final outcome of
the case.

Scott M. Sperling, the Chair of the company's Executive Governance
& Nominating Committee said, "The Board of Directors is
disappointed with the decision in this matter, and fully supports
Mr. Bronfman as he appeals this verdict."  Michele J. Hooper, the
company's lead independent director and Chair of the company's
Audit Committee, added, "We did not expect this ruling as the
Board has been thoroughly briefed on the underlying facts and has
been closely monitoring the case, including through today's
verdict, with the advice of our outside corporate governance
counsel."

Mr. Bronfman remarked, "I am disappointed that the Court differed
with both the Paris public prosecutor and the lead civil claimant
in the case, APPAC, who both took the position that I should be
acquitted.  I will appeal today's decision to the Paris Court of
Appeal and continue to vigorously defend myself against this
charge.  As I have consistently stated, my trades were proper."

                      About Warner Music Group

Based in New York, Warner Music Group Corp. (NYSE: WMG)
-- http://www.wmg.com/-- was formed by a private equity
consortium of investors on November 21, 2003.  The Company is the
direct parent of WMG Holdings Corp., which is the direct parent of
WMG Acquisition Corp.  WMG Acquisition Corp. is one of the world's
major music-based content companies and the successor to
substantially all of the interests of the recorded music and music
publishing businesses of Time Warner Inc.

The Company classifies its business interests into two fundamental
operations: Recorded Music and Music Publishing.  The Company's
Recorded Music business primarily consists of the discovery and
development of artists and the related marketing, distribution and
licensing of recorded music produced by such artists.  The
Company's Music Publishing operations include Warner/Chappell, its
global Music Publishing company, headquartered in New York with
operations in over 50 countries through various subsidiaries,
affiliates and non-affiliated licensees.

The Company's balance sheet at June 30, 2010, showed $3.65 billion
in total assets, $3.82 billion in total liabilities, and
a stockholders' deficit of $174 million.

                          *     *     *

As reported by the Troubled Company Reporter, Standard & Poor's
Ratings Services on Aug. 13, 2010, revised its rating outlook on
Warner Music Group Corp. to negative from stable.  Ratings on the
company, including the 'BB-' corporate credit rating, were
affirmed.  "The revised outlook reflects continued revenue and
EBITDA declines amid a light album release schedule and ongoing
challenges in maintaining profitability levels due to the digital
transition taking place within the industry, notwithstanding
vigilant cost management," said Standard & Poor's credit analyst
Michael Altberg.

As reported by the TCR on October 4, 2010, Fitch affirmed these
ratings: Warner Music Group Corp. (IDR at 'BB-'.); WMG Holdings
Corp. (IDR at 'BB-'; and -- Unsecured notes at 'B'); and WMG
Acquisition Corp. (IDR at 'BB-'; Secured notes at 'BB';
Subordinated notes at 'B+').

Fitch's ratings are supported by WMG's market position as the
third largest music distributor/label, with a 20% market share
according to Nielsen SoundScan.  Fitch said liquidity is
sufficient, as the company generates sufficient cash to support
operations and capital expenditures.  As of June 30, 2010, WMG had
$400 million in consolidated cash and cash equivalents (including
$176 million of cash at the parent holding company).  There are no
maturities until 2014, when approximately $900 million in
subordinated debt (including WMG Holdings Corp. notes) are due.

Standard & Poor's Ratings Services lowered its corporate credit
rating on New York City-based Warner Music Group Corp. to 'B+'
from 'BB-'.  The rating outlook is stable.


WESTERN SUPREME: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Western Supreme, Inc.
          dba Sunny California Poultry
              United Food Company
        11412 Drysdale Lane
        Los Alamitos, ca 90720
        Tel: (213) 627-3861

Bankruptcy Case No.: 11-10976

Chapter 11 Petition Date: January 23, 2011

Court: U.S. Bankruptcy Court
       Central District of California (Santa Ana)

Debtor's Counsel: Shawn A. McMillan, Esq.
                  THE LAW OFFICES OF SHAWN A. MCMILLAN
                  4955 Via Lapiz
                  San Diego, CA 92122
                  Tel: (858) 646-0069
                  Fax: (206) 600-4582
                  E-mail: attyshawn@netscape.net

Estimated Assets: $500,001 to $1,000,000

Estimated Debts: $1,000,001 to $10,000,000

The Company did not file a list of creditors together with its
petition.

The petition was signed by Frank B. Fogarty, chief executive
officer.


WORKFLOW MANAGEMENT: Unsecureds-Backed Plan Hearing on Feb. 24
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Workflow Management Inc. scheduled a Feb. 24
confirmation hearing for approval of a Chapter 11 plan now
supported by the official committee representing unsecured
creditors.  The bankruptcy court approved the explanatory
disclosure statement on Jan. 21, allowing creditors to vote.

Mr. Rochelle relates that the Creditors Committee removed its
opposition when the pot for unsecured creditors was doubled to
$2 million.  Unsecured creditors of the operating companies with
claims estimated at $25 million were originally projected to
receive between 1% and 4%.  The revised plan calls for an
affiliate of Perseus LLC, the existing owner, to receive 41.5% of
the new common stock in return for a $12.5 million investment.
The Plan is supported by the agent for second-lien lenders owed
$196.5 million.

A copy of the disclosure statement to the Third Amended Plan of
Reorganization, filed Jan. 21, 2011, is available for free at:

      http://bankrupt.com/misc/Workflow_3rdAmended_DS.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.  The Official Committee of Unsecured
Creditors retained Venable LLP as counsel and Protiviti Inc. as
financial advisor.

Workflow Management estimated assets and debts at $100 million to
$500 million as of the Chapter 11 filing.


W.R. GRACE: Garlock Has Approval to Access Rule 2019 Statements
---------------------------------------------------------------
Garlock Sealing Technologies LLC received approval from the
Bankruptcy Court of its request for access to statements filed
under Rule 2019 of the Federal Rules of Bankruptcy Procedure by
law firms representing asbestos personal injury claims in 12
Chapter 11 cases, including the Chapter 11 case of W.R. Grace &
Co. and its debtor affiliates.

                      About W.R. Grace & Co.

Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.

The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring effort.  The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.  Stroock &
Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors.  The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice.  David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants.  The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it.  Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.

W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization.  The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims.  The Plan confirmation hearing
wrapped up on January 25.

Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates.  (http://bankrupt.com/newsstand/or 215/945-7000)


YITC-GP LLC: Sequoia Wants Dismissal of Involuntary Ch. 11 Case
---------------------------------------------------------------
Sequoia Capital Partners, LLC, asks the U.S. Bankruptcy Court for
the Eastern District of Texas to dismiss YITC-GP, LLC's
involuntary Chapter 11 bankruptcy case.

The Debtor, Sequoia Capital, the other two creditors, and all
other persons who have appeared in this case and asserted that
they are parties in interest reached an agreement to have the
bankruptcy case dismissed.  The United States Trustee has agreed
to the relief in this motion.

The Debtor is a defendant in the adversary case styled David E.
Girault et al. v. Rhoderick Tyrone Williams et al., Adv. No. 10-
07010, in the U.S. Bankruptcy Court for the Southern District of
Texas, McAllen Division.  David Girault, Las Pecheras, Inc., and
Robert Yarto had each brought various claims against the Debtor
and other parties in the Adversary Case.  The parties to the
Adversary Case, including the Debtor's primary creditor, General
Electric Capital Corp., have reached a settlement of all claims
and causes of action pending in the Adversary Case, including
those against Debtor.  The settlement was approved by the U.S.
Bankruptcy Court for the Eastern District of Texas.

Sequoia Capital says that based on the change in Debtor's
circumstances that has resulted from its settlement with its
creditors, cause exists to dismiss this case.  The settlement
agreement provides for the dismissal of this Chapter 11 case.

The Court has set for February 7, 2011, at 10:00 a.m. a hearing on
Sequoia Capital's request for dismissal.

Sequoia Capital is represented by Richard W. Ward, who has an
office Plano, Texas.

Sequoia Capital Partners, LLC filed a Chapter 11 involuntary
petition against Frisco, Texas-based YITC-GP, LLC, on April 27,
2010 (Bankr. E.D. Tex. Case No. 10-41309).


* Corporate Debt Discharged in Officer's Bankruptcy
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals for the Seventh Circuit in
Chicago ruled on Jan. 21 that fiduciary duties toward creditors
thrust upon officers of an insolvent company don't mean that a
corporate officer can't discharge a company debt in his own
bankruptcy,

Mr. Rochelle relates that the case involved the head of an
advertising agency that went bankrupt.  A client paid the agency
to buy advertising space.  When the agency went bankrupt, some
media hadn't been paid, with the result that the client had to pay
twice.  When the agency's head filed for personal bankruptcy, the
client sued in bankruptcy court for a declaration that the debt
wasn't dischargeable.  The client relied on the notion under most
state law that officers of an insolvent company assume fiduciary
duties to creditors of the company.  The client argued that the
company officer wasn't entitled to discharge the debt in his
personal bankruptcy because he committed fraud while acting in a
fiduciary capacity.

According to Mr. Rochelle, upholding the bankruptcy court, U.S.
Circuit Judge David F. Hamilton ruled that not every fiduciary
duty under state law qualifies as the type of fiduciary duty on
which a debt can be exempted from discharge. In the process, he
agreed with the U.S. Court of Appeals in New Orleans and differed
with several district and bankruptcy courts.  Accepting the
creditor's argument in the absence of fraud, Judge Hamilton said,
"would go a long way toward imposing nondischargeable personal
liability on corporate officers and directors for general
corporate debts of faltering corporations."  Judge Hamilton cited
the familiar rule that exceptions to discharge must be construed
narrowly.

The appellate case is Follett Higher Education Group, Inc., an
Illinois corporation, v. Jay Berman, No. 10-1882 (7th. Cir.).  The
three-judge panel consists of Circuit Judges Michael Stephen
Kanne, John Daniel Tinder, and David Frank Hamilton.  A copy of
the January 21, 2011 decision, penned by Judge Hamilton, is
available at http://is.gd/3uMDTzfrom Leagle.com.


* Industry Review Cues S&P's Rating Actions on U.S. Oil & Gas Cos.
------------------------------------------------------------------
Standard & Poor's Ratings Services took several rating actions on
16 U.S. oil and gas exploration and production companies following
an industry review.  S&P's review on the sector followed S&P's
Sept. 30, 2010, revision of S&P's exploration and production
recovery criteria.  The new approach aims to better reflect S&P's
expectation for commodity prices and reserve values in a default
scenario.

The rating actions S&P took, were on speculative-grade companies
and affected specific issues and their respective recovery
ratings. S&P did not take any corporate credit rating actions.
(Standard & Poor's recovery rating scale ranges from '6',
indicating expectations of negligible [0%-10%] recovery in a
payment default, to '1+', indicating expectations of full [100%]
recovery.)  S&P included in its reviews an updated reserve report
utilizing S&P's new price deck.

Ratings List
Issue Ratings lowered; Recovery Ratings Revised
                                           To     From
Quicksilver Resources Inc. (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          5      3

BreitBurn Energy Partners (B+/Stable/--)
Senior Unsecured                          B      B+
  Recovery Ratings                         5      4

Helix Energy Solutions Group Inc. (B/Stable/--)
Senior Unsecured                          CCC+   B-
  Recovery Ratings                         6      5

Rosetta Resources Inc. (B/Stable/--)
Senior Unsecured                          B-     B+
  Recovery Rating                          5      2

Chaparral Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B+
  Recovery Rating                          4      2

NFR Energy LLC (B/Stable/--)
Senior Unsecured                          B-     B
  Recovery Rating                          5      4

Venoco Inc. (B/Stable/--)
Second-Lien Secured                       B      BB-
  Recovery Rating                          4      1

Delta Petroleum Corp. (CCC/Negative/--)
Senior Unsecured                          CCC-   CCC
  Recovery Rating                          5      4

Dune Energy Inc. (CCC-/Negative/Unsolicited)
Second-Lien Secured                       CC       CCC-
  Recovery Rating                          5        4


Issue Ratings Raised; Recovery Ratings Revised
                                           To     From
Penn Virginia Corp. (BB-/Stable/--)
Subordinated                              B+     B
  Recovery Rating                          5      6

Forest Oil Corp. (BB-/Stable/--)
Senior Unsecured                          BB-    B+
  Recovery Rating                          4      5

Clayton Williams Energy Inc. (B/Stable/--)
Senior Unsecured                          B      B-
  Recovery Rating                          4      5


Issue Ratings Unchanged; Recovery Ratings Revised
                                           To     From
Whiting Petroleum Corp. (BB/Stable/--)
Recovery Rating                           4      3

Range Resources Corp. (BB/Stable/--)
Recovery Rating                            3      4

Bill Barrett Corp. (BB-/Stable/--)
Recovery Rating                           3      4

PetroQuest Energy Inc. (B/Stable/--)
Recovery Rating                           4      3


* Reports on State Debt Woes Exaggerated, Nonprofit Group Says
--------------------------------------------------------------
Dow Jones Newswires' Kelly Nolan reports that the nonprofit Center
on Budget and Policy Priorities said in a report Thursday recent
media reports that suggest state and local governments could
default on their debt or declare bankruptcy because of large
budget deficits and unfunded pension liabilities overstate the
issue.  The nonpartisan policy group, according to Dow Jones, said
commentators have conflated states' fiscal problems, caused by the
recession, with longer-term issues of debt, pension obligations,
and retiree health costs.  This has created "the mistaken
impression that drastic and immediate measures are needed to avoid
an imminent fiscal meltdown," the report said.

According to Dow Jones, Iris J. Lav wrote the report with
Elizabeth McNichol.  "States have adequate tools and means to meet
their obligations," they wrote.  "The potential for bankruptcy
would just increase the political difficulty of using these other
tools to balance their budgets, delaying the enactment of
appropriate solutions."

It is far "more constructive" to focus on fixing these basic
building blocks of state and local finance than to "proclaim a
crisis based on exaggerations of imminent threats," Ms. Lav said
in a conference call with reporters, according to Dow Jones.

Dow Jones also relates Ms. Lav estimated that states will face a
$125 billion shortfall for fiscal 2012, which starts July 1 in
most cases.  But these financial woes should subside when the
economy improves, she added.  In the meantime, state and local
governments have addressed these gaps through using reserve funds,
cutting costs and raising taxes, among other things.


* Restructuring of Hotel Portfolio Debts Seen This Year
-------------------------------------------------------
A report by The Wall Street Journal's Mike Spector and Kris Hudson
indicates several restructurings of pricey hotel portfolios taken
private during the boom and loaded with debt will likely to occur
this year.  The WSJ report states that:

     -- CNL Hotels & Resorts Inc., a collection of eight U.S.
        luxury resorts held by a Morgan Stanley fund, has nearly
        a third of its $3.3 billion in debt coming due Feb. 1.

     -- Kerzner International Resorts Inc., owner of the Atlantis
        resort in the Bahamas, has half of its $2.6 billion of
        debt expiring in September.

As reported in today's Troubled Company Reporter, people familiar
with the matter have told the Journal Highland Hospitality Corp.
is nearing a deal with creditors, including Ashford Hospitality
Trust, Prudential Financial Inc., Barclays PLC and Blackstone
Group LP, to restructure $1.8 billion in debt outside of
bankruptcy court.

The Journal notes the hotel-restructuring wave comes just as the
hospitality sector rebounds from the recession. Hotel values had
declined an estimated 55% between mid-2007 and mid-2009, according
to Green Street Advisors Inc.  Since then, values have recovered,
along with hotel occupancy and nightly rates.

Still, hotel values remain 25% below their mid-2007 peak,
according to Green Street, according to the Journal.  The upshot
is that the hotel industry's resurgence isn't happening fast
enough to help owners of troubled hotels refinance or pay down
billions in mortgages that come due over the next two years,
including more than $9 billion alone in securitized mortgages.

That has left owners of troubled hotel properties scrambling to
rework their debts, the Journal says.


* Colony-Led Group Said to Buy $820MM in Failed Bank Mortgages
--------------------------------------------------------------
According to The Wall Street Journal's Eliot Brown, people
familiar with the matter said the Federal Deposit Insurance Corp.
is set to announce as early as Wednesday that a group led by
Colony Capital LLC was awarded two portfolios with $820 million of
commercial and residential mortgages seized from failed banks.
The price couldn't be determined.

According to Mr. Brown, Colony is now emerging as one of the
dominant players in the acquisition of distressed assets from the
Federal Deposit Insurance Corp.  Mr. Brown relates Los Angeles-
based Colony, led by Chairman Tom Barrack, made headlines last
year by joining a group that bought Miramax Films.  Colony already
has won four other portfolios of FDIC mortgages valued at more
than $3 billion, making it the largest winner of multiple deals.
Mr. Brown also notes the firm bid and lost on the single-biggest
FDIC deal, the $4.5 billion in real-estate assets of the Chicago-
based Corus Bank won by a Starwood Capital-led group.  No other
bidder has won more than two portfolios.

The Journal notes the FDIC sold $11.8 billion of commercial-
property assets last year through structures similar to the Colony
deals, and analysts expect a similar volume this year.

The Journal also relates Edward Loyd, CEO of Loyd Capital
Management, one of the losing bidders on numerous FDIC deals, has
said the fact that Colony keeps winning means that others will
stop bidding, thus depressing prices from a lack of competition.
"Economies of scale are killing the competitiveness of this
process," Mr. Loyd said, as the number of bidders fell by the end
of 2010. "It's a flawed system."

As policy, the FDIC awards each portfolio to the highest bidder
"that best maximizes the return," a spokeswoman said, according to
the Journal.


* Bradley Arant Attorneys Publish Creditors' Rights Law Handbook
----------------------------------------------------------------
Bradley Arant Boult Cummings LLP partners William L. Norton, IIII,
and Roger G. Jones have co-authored the 2010 edition of the Norton
Creditors' Rights Handbook.  The attorneys have worked together
for over twenty year and are members of the firm's Bankruptcy,
Restructuring and Distressed Investing Group.

The Norton Creditors' Rights Handbook, published by
ThomsonReuters, is a definitive resource for bankruptcy attorneys,
in-house counsel, credit managers and others regarding controlling
credit transactions.  It provides a narrative outline of the three
major steps in the debtor-creditor relationship: inception, out-
of-court workout, and bankruptcy.  The text analyzes the important
laws and regulations in effect, identifies potential problem areas
at each juncture of the process, offers practice-proven strategies
for avoiding creditor traps and pitfalls, and includes forms used
to document various transactions.  For more information, or to
purchase a copy, visit http://ResearchArchives.com/t/s?7282

This is the second significant publication by members of the
Bradley Arant Boult Cummings Bankruptcy, Restructuring and
Distressed Investing Group in the past year. In the spring of
2010, Patrick Darby co-authored the ABI Guide to Chapter 9.

               About Bradley Arant Boult Cummings LLP

Tracing its roots to 1871, Bradley Arant Boult Cummings LLP has
more than 380 attorneys in seven offices.  The law firm maintains
offices in Birmingham, Huntsville, and Montgomery, Alabama;
Jackson, Mississippi; Charlotte, North Carolina; Nashville,
Tennessee; and Washington, D.C.  The firm's lawyers serve clients
locally, regionally, nationally and internationally, and provide
services across a wide range of industries, including accounting,
automotive, banking and finance, biotechnology, life sciences,
construction, education, emerging business, energy, entertainment,
equipment leasing, forest products, government contracts, health
care, life sciences, hospitality, insurance, manufacturing,
materials and aggregate production, media and communications,
mining, municipal and public finance, oil and gas, pharmaceuticals
and medical devices, public utilities, real estate, retail, steel,
technology, telecommunications, textiles, transportation, and
venture capital.


* Upcoming Meetings, Conferences and Seminars
---------------------------------------------

Feb. 3-5, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Caribbean Insolvency Symposium
         Westin Casuarina Resort & Spa, Grand Cayman Island
            Contact: 1-703-739-0800; http://www.abiworld.org/

Feb. 18, 2011
   WHARTON RESTRUCTURING CLUB
      7th Annual Wharton Restructuring and Turnaround Conference
         The Union League, Philadelphia, Pa.
            Contact: http://whartonrestructuringconference.org/
                     Colin McGinnis -- mcginnic@wharton.upenn.edu
                     Adam Piekarski -- adamjp@wharton.upenn.edu
                     Avi Robbins -- arobb@wharton.upenn.edu

Feb. 24-25, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Valcon
         Four Seasons Las Vegas, Las Vegas, Nev.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Mar. 4, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Bankruptcy Battleground West
         Hyatt Regency Century Plaza, Los Angeles, Calif.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Mar. 7-9, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Conrad Duberstein Moot Court Competition
         Duberstein U.S. Courthouse, New York, N.Y.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Mar. 10, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Nuts and Bolts - Florida
         Tampa, Fla.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Mar. 10-12, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      SUCL/ Alexander L. Paskay Seminar on
      Bankruptcy Law and Practice
         Marriott Tampa Waterside, Tampa, Fla.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Mar. 17-19, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Byrne Judicial Clerkship Institute
         Pepperdine University School of Law, Malibu, Calif.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Mar. 31-Apr. 3, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Annual Spring Meeting
         Gaylord National Resort & Convention Center,
         National Harbor, Md.
            Contact: 1-703-739-0800; http://www.abiworld.org/

April 27-29, 2011
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Spring Conference
         JW Marriott, Chicago, IL
            Contact: http://www.turnaround.org/

May 5, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Nuts and Bolts - New York City
         Association of the Bar of the City of New York,
         New York, N.Y.
            Contact: 1-703-739-0800; http://www.abiworld.org/

May 6, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      New York City Bankruptcy Conference
         Hilton New York, New York, N.Y.
            Contact: 1-703-739-0800; http://www.abiworld.org/

June 6, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Canadian-American Cross-Border Insolvency Symposium
         Fairmont Royal York, Toronto, Ont.
            Contact: 1-703-739-0800; http://www.abiworld.org/

June 9-12, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Central States Bankruptcy Workshop
         Grand Traverse Resort and Spa, Traverse City, Mich.
               Contact: http://www.abiworld.org/

July 21-24, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Northeast Bankruptcy Conference
         Hyatt Regency Newport, Newport, R.I.
            Contact: 1-703-739-0800; http://www.abiworld.org/

July 27-30, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Southeast Bankruptcy Workshop
         The Sanctuary at Kiawah Island, Kiawah Island, S.C.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Aug. 4-6, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      Mid-Atlantic Bankruptcy Workshop
         Hotel Hershey, Hershey, Pa.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Oct. 14, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      NCBJ/ABI Educational Program
         Tampa Convention Center, Tampa, Fla.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Oct. __, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      International Insolvency Symposium
         Dublin, Ireland
            Contact: 1-703-739-0800; http://www.abiworld.org/

Oct. 25-27, 2011
   TURNAROUND MANAGEMENT ASSOCIATION
      Hilton San Diego Bayfront, San Diego, CA
         Contact: http://www.turnaround.org/

Dec. 1-3, 2011
   AMERICAN BANKRUPTCY INSTITUTE
      23rd Annual Winter Leadership Conference
         La Quinta Resort & Spa, La Quinta, Calif.
            Contact: 1-703-739-0800; http://www.abiworld.org/

April 3-5, 2012
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Spring Conference
         Grand Hyatt Atlanta, Atlanta, Ga.
            Contact: http://www.turnaround.org/

Apr. 19-22, 2012
   AMERICAN BANKRUPTCY INSTITUTE
      Annual Spring Meeting
         Gaylord National Resort & Convention Center,
         National Harbor, Md.
            Contact: 1-703-739-0800; http://www.abiworld.org/

July 14-17, 2012
   AMERICAN BANKRUPTCY INSTITUTE
      Southeast Bankruptcy Workshop
         The Ritz-Carlton Amelia Island, Amelia Island, Fla.
            Contact: 1-703-739-0800; http://www.abiworld.org/

Aug. 2-4, 2012
   AMERICAN BANKRUPTCY INSTITUTE
      Mid-Atlantic Bankruptcy Workshop
         Hyatt Regency Chesapeake Bay, Cambridge, Md.
            Contact: 1-703-739-0800; http://www.abiworld.org/

November 1-3, 2012
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Annual Convention
         Westin Copley Place, Boston, Mass.
            Contact: http://www.turnaround.org/

Nov. 29 - Dec. 2, 2012
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
            Contact: 1-703-739-0800; http://www.abiworld.org/

April 10-12, 2013
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Spring Conference
         JW Marriott Chicago, Chicago, Ill.
            Contact: http://www.turnaround.org/

October 3-5, 2013
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Annual Convention
         Marriott Wardman Park, Washington, D.C.
            Contact: http://www.turnaround.org/

The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday.  Submissions via
e-mail to conferences@bankrupt.com are encouraged.

Last Updated: Jan. 25, 2011



                           *********

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 by e-mail.

On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases by individuals and business entities estimating
assets and debts or disclosing assets and liabilities at less than
$1,000,000.  The list includes links to freely downloadable images
of the small-dollar business-related 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.  Jhonas Dampog, 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 2011.  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.


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