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/raid1/www/Hosts/bankrupt/TCR_Public/110414.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, April 14, 2011, Vol. 14, No. 103 Headlines 1ST & STATE: Case Summary & 15 Largest Unsecured Creditors 20 BAYARD: Court Approves Laub Consulting as Financial Advisor 2006 PROSPER: Wants Case Dismissed; Has No Means to Formulate Plan ADOBE CREEK: Gallagher Acquires Golf Course in Chapter 7 AG FERRARI: Says Creditors' Panel Not Necessary AGE REFINING: Court to Consider $41-Mil. Sale Today ALLEN FERGUSON: Financial Woes Prompts Chapter 11 Bankruptcy APPLESEED'S INTERMEDIATE: Committee Has OK for CMAG as Advisors ARLIE & CO: Combined Hearing on Plan Tomorrow ART ONE: Asks for Court's Permission to Use Cash Collateral ASARCO LLC: Plan Admin. Wants Claims Objections Further Extended ASARCO LLC: CSM Wants to Bar Discovery of Settlement Data ASARCO LLC: Victor Karl Objects to Summary Judgement Proceeding BARNES BAY: Viceroy Anguilla Resort Unit Buyer Objects to Sale BARNES BAY: Taps Richards Layton as Delaware Counsel BARNES BAY: Proposes Akin Gump as Bankruptcy Counsel BARNES BAY: Taps Keithley Lake as Special Counsel in Anguila BELTWAY 8: Plan Offers Full Payment to Unsecureds After One Year BERNARD L MADOFF: Trustee May Disclose Bank Officers' Identities BION ENVIRONMENTAL: Has Project With Kreider to Cut Ammonia BLOCKBUSTER INC: Landlords Object to Proposed Sale Order BORDERS GROUP: U.S. Trustee Opposes $8-Mil. in Bonuses for Execs. BORDERS GROUP: Reaches Deal with Committee on Sutherland Contract BORDERS GROUP: Wins Approval to Modify Trade Terms With Vendors BORDERS GROUP: Borders Properties' Schedules and Statement BRSP LLC: S&P Assigns 'BB-' Rating on $282MM Sr. Secured Term Loan BRUGNARA PROPERTIES: Disclosure Statement Hearing Set for May 12 BRYAN/MOORE DEV'T: Court Dismisses Chapter 11 Bankruptcy Case CALUMET SPECIALTY: S&P Puts 'B' Rating on Proposed $375MM Notes CASCADE ACCEPTANCE: Court Denies Farella's $66T Bill CATHOLIC CHURCH: Jesuits Settle Abuse Claims for $166 Million CATHOLIC CHURCH: Wilmington Diocese to Lay Off Employees CATHOLIC CHURCH: Milw. Proposes to Modify Cemetery Staff CBA CATHOLIC CHURCH: CBNA Appeals District Court Arbitration Order CELLO ENERGY: Court Rules on Suit Against Parsons & Whittemore CHAMPION ENVIRONMENTAL: Case Summary & Creditors List CHEM RX: Creditors Win Confirmation of Liquidating Plan CHRISTIAN KNUDSEN: Ch. 7 Trustee to Probe Former Bankr. Counsel CINRAM INTERNATIONAL: S&P Lowers Corporate Credit Rating to 'D' CLUB VENTURES: Court Okays Klestadt & Winters as Panel's Counsel CMHA/TCB LAUREL: Wants to Tap David Donnett for Tenant Evictions CMHA/TCB LAUREL: Taps Santen & Hughes as Bankruptcy Counsel CRYSTAL CATHEDRAL: Court OKs BSW as Committee's Fin'l Consultant CYNTHIA TURNER: Court Pegs BofA Lien at $850,000 DANIEL COOK: Bankruptcy Court Rules on Pending Motions DEVELOPMENTAL DYNAMICS: Case Summary & Creditors Lists DONALD PEDERSEN: Bankr. Court Avoids Doucette Lien on House DRYSHIPS INC: Ocean Rig Prices Sr. Unsecured Bonds Offering DYNEGY INC: Hires White & Case and Lazard for Restructuring Advice EAST COAST: In Ch. 11 to Restructure Georgia Capital Debt EMISPHERE TECHNOLOGIES: Amends Form S-1 for $8.14 Million Shares EMIVEST AEROSPACE: Auctions Two Ground Leased Airport Properties ENRON CORP: Jeff Skilling Loses Appeal to Overturn Convictions ENRON CORP: Former Exec. Shelby Sentenced for Insider Trading ENRON CORP: IRS Pays $1.1-Mil. Reward to Whistleblower FARMLAND INDUSTRIES: 8th Cir. Affirms Dismissal of GAF Suit FLYING MARLIN: Case Summary & 20 Largest Unsecured Creditors FORUM HEALTH: Committee Fights Foundations' Chapter 11 Exit FR & S CORP: Court Rules on Puerto Rico Treasury's Tax Claims FRENCH BROAD: Faces Objections at April 20 Plan Hearing GEOSPATIAL HOLDINGS: Inks Settlement Deal with 29 Investors GLADIOLA WOOD-TOLSON: U.S. Trustee Seeks Chapter 7 Conversion GMX RESOURCES: David Lucke Does Not Own Any Securities GOARANY DEVELOPERS: Voluntary Chapter 11 Case Summary GREENBRIER COS: Announces Results to Date of Tender Offer GREENWICH SENTRY: Creditors Have Until May 23 to File Claims GREENWICH SENTRY: Has Until June 17 to File Chapter 11 Plan GRIND COFFEE: First Bank's Collateral Valued at $350,000 GRUBB & ELLIS: Fails to Get Consents to Amend 2010 Indenture HARRY & DAVID: Section 341(a) Meeting Set for April 27 HARRY & DAVID: Wants June 17, 2011 General Claims Bar Date HARRY & DAVID: Asks for Approval of Jones Day as Counsel HARRISBURG, PA: Should Negotiate Before Ch. 9 Filing, Cravath Says HARVEST OAKS: Court Extends Use of Cash Collateral Through May 31 HARVEST OAKS: Court Reschedules Confirmation Hearing to June 30 HASSEN REAL ESTATE: Case Summary & 10 Largest Unsecured Creditors HERCULES OFFSHORE: Lisa Rodriguez to Resign as VP Human Resources HILTON STEIN: Former Clients' Lawsuit Goes to Trial HQ SUSTAINABLE: Gets NYSE Amex Noncompliance Notice HSRE-CDS I: Has Interim Access to Cash Collateral Until May HSRE-CDS I: Has Nod to Pay Critical Vendors' Prepetition Claims IMPACT CASH: Rocky Mountain Advisory's Miller Named as Receiver INDALEX LIMITED: Union Wins Landmark Court Ruling on Pensions INDIANAPOLIS DOWNS: Has Court's Nod to Hire Epiq as Claims Agent INDIANAPOLIS DOWNS: Taps Greenberg Traurig as Bankruptcy Counsel INDIANAPOLIS DOWNS: Wants Polsinelli Shughart as Conflicts Counsel INFOLINK GROUP: Trustee Directed to Re-Issue Stock Certificate JOHN STOKES: U.S. Trustee Suit Goes to Trial KMC REAL ESTATE: Files List of Five Largest Unsecured Creditors KMS II: M&I Guaranty Action Goes to Sarasota County Court LA JOLLA: Case Summary & 20 Largest Unsecured Creditors LAWRENCE KASSOVER: Plan Trustee Fails in Bid to Reopen Case LEE ENTERPRISES: S&P Assigns 'B' Corporate Credit Rating LEHMAN BROTHERS: Committee Backs $809MM Acquisition of Pine Notes LEHMAN BROTHERS: OKs BNC and Aurora Bank Services Agreement LEHMAN BROTHERS: U.S. Bank, et al., Appeal ADR Order LEVEL 3 COMMS: Registers Preferred Shares With NASDAQ LEVEL 3 COMMS: Adopts Rights Plan Designed to Protect NOLs LITHIUM TECHNOLOGY: Lim Kee Discloses 67.7% Equity Stake LIZ CLAIBORNE: S&P Raises Corp. Credit Rating to 'B-' From 'SD' LOTHIAN OIL: Bankruptcy Court Enters Show Cause Order LOTT SURPLUS: Bank's Suit v. Insurer Stays in Bankruptcy Court MARITIME TELECOMMUNICATIONS: S&P Puts 'B' Corporate Credit Rating MARKET CENTER: Special Counsel Awarded 1/4 of Requested Fees MCCLURE PROPERTIES: Court Rules on Suit vs. Fifth Third Bank MEDICAL PROPERTIES: S&P Puts 'BB' Rating on Proposed $450MM Notes MESA AIR: Has Stipulation With Suntrust on Assumption Issues MESA AIR: Assumes Zurich Surety Bonds and Indemnity Agreements MESA AIR: Resolves Bombardier Administrative Claims MICHAEL KIRKBRIDE: Court Rules on Contractor's Lawsuit MOON THAI: Court Suspends Brown Van Horn's Bankruptcy Practice NATIONAL CONSUMER: Court Denies Rio's Motion for Sanctions NEW CENTURY FIN'L: Court Rejects Muhammad Admin. Claim NEW RIVER: Court Denies Creditor's Motion for Sanctions NEW STREAM: Facing Objections From Committee at Today's Hearing NEXHORIZON BROADBAND: Case Summary & Creditors List NEXTAG INC: S&P Assigns 'BB-' Corporate Credit Rating NEXSTAR BROADCASTING: S&P Puts 'BB-' Rating on Proposed $50MM Loan NORTEK INC: S&P Affirms 'B' Corporate Credit Rating NORTH GENERAL: U.S. Trustee Wants J. Garrity as Ch. 11 Trustee OLD COLONY: Hearing on Cash Collateral Motion Set for April 28 OTTER TAIL: Completes Sale of Business to Green Plains for $60MM OUTSOURCE HOLDINGS: Files List of 18 Largest Unsecured Creditors OVERLAND STORAGE: Joseph De Perio Appointed as Board Member PACIFIC DEVELOPMENT: Has OK to Sell Five Lots to Sierra Homes PAPERWORKS INDUSTRIES: S&P Assigns 'B' Corporate Credit Rating PHOENIX ASSOCIATES: Trustee Cannot Avoid Transfer of Appeal Bond PINNACLE HILLS: Case Summary & 9 Largest Unsecured Creditors PPL CAPITAL: Fitch Puts 'BB+' Rating on Junior Subordinated Notes PROFESSIONAL VETERINARY: Plan Exclusivity Extended Until May 17 PROFESSIONAL VETERINARY: Seeks to Employ BKD LLP as Auditors RAY ANTHONY: Seeks to Employ W.B. Kania as Accountant RAY ANTHONY: Has Until April 13 to Decide on Unexpired Leases RCC NORTH: U.S. Bank Plan Disclosures Hearing Scheduled for May 18 RCI REGIONAL: Case Summary & 2 Largest Unsecured Creditors RICHFIELD 81: Judge Massey Rejects Debtor's Dirt-For-Debt Plan RK HOSPITALITY: Case Summary & 4 Largest Unsecured Creditors SATELITES MEXICANOS: Wants Ernst & Young as Financial Advisor SATELITES MEXICANOS: Wants Lazard Freres as Investment Banker SBARRO INC: Nebraska District Court Issues Show Cause Order SEA TURTLE: Wells Fargo Buys Shopping Center for $10-Mil. SEXY HAIR: Taps Eckert Seamans to Handle Intellectual Property SHARPER IMAGE: To Pay Some Gift-Card Claimholders SHOPS AT PRESTONWOOD: Taps Franklin Skierski as Bankruptcy Counsel SIMIS, INC.: Case Summary & 20 Largest Unsecured Creditors SOLOMON DWEK: Court Rules on Chapter 11 Trustee's Suit v. Levy STATION CASINOS: Updated Chapter 11 Case Summary SUNVALLEY SOLAR: Posts $184,400 Net Loss in June 30 Quarter TASTY BAKING: Incurs $45.18 Million Net Loss in 2010 TAYLOR BEAN: Ex-Chairman Farkas Needs More Money for Defense TENET HEALTHCARE: Sues CHS for Disclosing False Statements TERRA BENTLEY II: Summary Judgment Bid in Avoidance Suit Denied TEXSTYLE, LLC: Files for Chapter 11, Weighed Down by Payables TEXSTYLE, LLC: Voluntary Chapter 11 Case Summary T.H. PROPERTIES: Can Complete 600 Homes Under BoA Lending Deals TRIBUNE CO: Modifies Plan to Address Noteholders Objection TRIBUNE CO: Sends Caption Colorado Dispute to Arbitration UNILAVA CORPORATION: Incurs $1.00 Million Net Loss in 2010 UNISYS CORP: Holders Validly Tender $325.83MM of Senior Notes VILICA LLC: Files Amended Schedules of Assets and Liabilities VINOD & SONS: Case Summary & 13 Largest Unsecured Creditors VITRO SAB: Court Denies Involuntary Petitions vs. 4 US Units WASHINGTON LOOP: U.S. Trustee Asks for Dismissal of Ch. 11 Case WB REAL ESTATE: Case Summary & 9 Largest Unsecured Creditors ZALE CORP: Suspending Filing of Reports Under Savings Plan * Gonzalez to Retire From Manhattan Bankruptcy Bench in Feb. 2012 * Grant Thornton LLP to Acquire Portion of LECG Practice * Recent Small-Dollar & Individual Chapter 11 Filings ********* 1ST & STATE: Case Summary & 15 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: 1st & State Real Estate Holdings, LLC 2888 East Walnut Street, Studio 1 Pasadena, CA 91107 Bankruptcy Case No.: 11-25911 Chapter 11 Petition Date: April 12, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Barry Russell Debtor's Counsel: Ralph S. Greer, Esq. LAW OFFICE OF RALPH S. GREER 2493 E. Colorado Boulevard Pasadena, CA 91107 Tel: (626) 405-2353 Fax: (626) 405-9152 E-mail: rsgreer@pacbell.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 15 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/cacb11-25911.pdf The petition was signed by Estelle Campbell, managing member. 20 BAYARD: Court Approves Laub Consulting as Financial Advisor -------------------------------------------------------------- The Hon. Elizabeth S. Stong of the U.S. Bankruptcy Court for the Eastern District of New York authorized 20 Bayard Views LLC to employ Laub Consulting Services LLC as its financial advisors and accountants. The firm will render the financial advisory and accounting services required by the Debtor in connection with the Debtor's Chapter 11 case. The firm's managing principal will charge $385 per hour for this engagement. The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About 20 Bayard Views 20 Bayard Views, LLC, owns and runs the Bayard Condominium Complex at at 20 Bayard Street, in Brooklyn , New York. A total of 37 of the 62 units remain unsold. 20 Bayard filed for Chapter 11 bankruptcy protection (Bankr. E.D.N.Y. Case No. 09-50723) on Dec. 4, 2009. Attorneys at Porzio, Bromberg & Newman, P.C., serve as general bankruptcy counsel and Moritt Hock Hamroff & Horowitz LLP is local counsel to the Debtor. The Company disclosed $21,219,696 in assets and $20,976,363 in liabilities as of the Chapter 11 filing. In March 2011, Bankruptcy Judge Elizabeth S. Stong issued an order denying confirmation of the Third Amended Plan of Reorganization, as modified, filed by 20 Bayard Views, LLC. The Court held that the Plan cannot be confirmed because it does not satisfy 11 U.S.C. Sec. 1129(b)'s cramdown requirements. W Financial Fund LP, owed $17.4 million in principal on account of a loan made in 2008, objected to the confirmation of the Plan. 2006 PROSPER: Wants Case Dismissed; Has No Means to Formulate Plan ------------------------------------------------------------------ 2006 Prosper Partners, L.P., asks the U.S. Bankruptcy Court for the Northern District of Texas to dismiss its Chapter 11 case because the Debtor currently holds only a nominal amount of $1,025 in cash and there remains no other assets of value to be liquidated for the benefit of creditors. The Debtor's sole real estate asset has been foreclosed upon by Wells Fargo Bank, N.A., the First Lien Lender. Thus, Debtor has no means to formulate a plan. The Debtor relates that if its case were converted to Chapter 7, the Chapter 7 trustee would also have no assets with which to pay Chapter 7 administrative expenses. Dallas, Texas-based 2006 Prosper Partners, L.P., is a single real estate debtor. The Debtor' sole asset consisted of three vacant parcels of real property aggregating approximately 600 acres and located in Collin and Denton counties, Texas, in the Town of Prosper. The Debtor sought Chapter 11 protection (Bankr. N.D. Tex. Case No. 10-34652) on July 2, 2010. Emily S. Chou, Esq., and Michael D. Warner, Esq., at Cole Schotz Meisel Forman & Leonard PA, represent the Debtor in the bankruptcy case. In its schedules, the Debtor disclosed $30,236,308 in assets and $48,475,646 in liabilities. ADOBE CREEK: Gallagher Acquires Golf Course in Chapter 7 -------------------------------------------------------- PressDemocrat.com reports that Adobe Creek Golf Course, an 18-hole public course, has been sold to Sonoma County, California builder Bill Gallaher, the former owner of the Oakmont Golf Course in Santa Rosa. Terms of the sale were not immediately available. No time has been set for the reopening of the 18-hole course designed by Robert Trent Jones. The course has been in a court-appointed receivership since filing for Chapter 7 bankruptcy in January of this year. AG FERRARI: Says Creditors' Panel Not Necessary ----------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that A.G. Ferrari Foods wants the bankruptcy judge to dispense with the formation of an official creditors' committee because it qualifies as a small business. The family-owned company, founded in 1919, is the operator of 13 Italian specialty food stores in the San Francisco Bay area. Total uncontested secured and unsecured debt is about $2.34 million. The San Leandro, California-based retailer says it owes $136,000 to the secured lender Bridge Bank NA. The inventory, it says, is worth $1.2 million. There is another $1.73 million in unsecured debt. A.G. Ferrari Foods filed a Chapter 11 petition (Bankr. N.D. Calif. Case No. 11-43327) on March 28, 2011. Eric A. Nyberg, Esq., at Kornfield, Nyberg, Bendes and Kuhner, in Oakland, California, represents the Debtor. The Debtor estimated assets and debts of $1 million to $10 million as of the Chapter 11 filing. A case summary for A.G. Ferrari is in the March 30, 2011 edition of the Troubled Company Reporter. AGE REFINING: Court to Consider $41-Mil. Sale Today --------------------------------------------------- Vicki Vaughan at My San Antonio reports that a court hearing on a plan to sell AGE Refining is set for 9:30 a.m. today, Thursday. Eric Moeller, the trustee for AGE's bankruptcy, is asking the court to approve the sale of AGE to a prospective buyer that he has designated. The hearing had been set for Monday but was postponed. According to the report, court documents indicate that the trustee's investment bank, Global Hunter Securities, got five bids for AGE, but the trustee determined that it was best for creditors to select a designated buyer without an auction. As widely reported, the purchase price for AGE's refining assets, truck loading rack, railcar loading facility and feedstock is $41 million. The prospective buyer will not be identified until a purchase agreement is signed. A court paper says the buyer is a publicly held company, Bill Rochelle, Bloomberg News' bankruptcy columnist, reported last week. Mr. Rochelle relates that the Chapter 11 trustee for Age Refining Inc. abandoned the idea of an auction and decided instead to sell the assets in a so-called private sale. The trustee decided to cancel the April 5 and 6 auction after negotiating with several potential purchasers. About Age Refining Age Refining, Inc. owns a refinery in San Antonio, Texas. It manufactures, refines and markets jet fuels, diesel products, solvents and other highly specialized fuels. The Company filed for Chapter 11 bankruptcy protection (Bankr. W.D. Texas Case No. 10-50501) on Feb. 8, 2010. Aaron Michael Kaufman, Esq.; Carol E. Jendrzey, Esq.; and Mark E. Andrews, Esq., t Cox Smith Matthews Incorporated, represent the Chapter 11 debtor. The Company estimated $10 million to $50 million in assets and $100 million to $500 million in liabilities in its bankruptcy petition. Eric Moeller has been named chapter 11 trustee to take management of the Debtor from Chief Executive Glen Gonzalez. In November 2010, the trustee filed suit against Mr. Gonzalez, alleging he breached his fiduciary duty by dipping into Company coffers for his personal use while paying himself an excessive salary and stock distributions, according to My San Antonio. ALLEN FERGUSON: Financial Woes Prompts Chapter 11 Bankruptcy ------------------------------------------------------------ Allen Ferguson filed a Chapter 11 bankruptcy petition on March 31, 2011 (Bankr. E.D. Va. Case No. 11-32141). Kristen MacBeth at BankruptcyHome.com reported that Mr. Ferguson, along with his wife Mary, estimated assets and liabilities between $1 and $10 million. In total, the couple owes $3.82 million to 20 unsecured creditors. According to the report, the largest debt, a total of $1.53 million, is owed to Virginia-area bank EVB, a total of $1.53 million, according to Richmond BizSense. An additional sum of nearly $750,000 is owed to Union First Market Bank. Many local citizens are supposed to receive funds from the couple, and a developer is also out $125,000. Wells Fargo is owed more than $662,000. The couple blamed their money trouble on the economy, says BankruptcyHome. "The bankruptcy was filed so that they could have control over an orderly liquidation of assets in a manner designed to pay their creditors," BankruptcyHome quotes Roy Terry, attorney in charge of the case, as saying. APPLESEED'S INTERMEDIATE: Committee Has OK for CMAG as Advisors --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware has granted the official committee of unsecured creditors of Appleseed's Intermediate Holdings, et al, permission to retain Carl Marks Advisory Group LLC as its financial advisors, nunc pro tunc to Jan. 28, 2011. The Court is satisfied that CMAG does not hold or represent an interest adverse to the Debtors' estates and that the CMAG is a "disinterested person" at that term is defined in Section 101(14) of the Bankruptcy Code. The order amends and supercedes the Court's previous order authorizing the employment of CMAG, dated March 7, 2011. CMAG shall be compensated in accordance with the terms of the Financial Advisory Agreement and, in particular, all of CMAG's fees and expenses in these Chapter 11 cases are approved pursuant to section 328(a) 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. Appleseed's is owned by Golden Gate Capital Corp., which also holds stakes in retailers Express Inc., Eddie Bauer Holdings Inc. and Zale Corp. Appleseed's Intermediate and its affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-10160) on Jan. 19, 2011. Appleseed's Intermediate estimated assets at $100 million to $500 million and debts at $500 million to $1 billion in its Chapter 11 petition. Richard M. Cieri, Esq., Joshua A. Sussberg, Esq., at Brian E. Schartz, at Kirkland & Ellis LLP, serve 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 notice, claims and balloting agent. Jay R Indyke, Esq., Cathy Hershcopf, Esq., Brent Weisenberg, Esq., and Richelle Kalnit, Esq., at Cooley LLP, in New York, and Robert K Malone, Esq., Michael P Pompeo, Esq., and Howard A Cohen, Esq., at Drinker Biddle & Reath LLP, in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. ARLIE & CO: Combined Hearing on Plan Tomorrow --------------------------------------------- The U.S. Bankruptcy Court for the District of Oregon adjourned until April 15, 2011, at 10:00 a.m., the combined hearing to consider adequacy of Arlie & Company's Disclosure Statement and confirmation of the proposed Plan of Reorganization, wherein all creditors will recover 100% of their allowed claims. As reported in the Troubled Company Reporter on January 17, 2011, the Debtor's Plan provides for, among other things: -- auctioning off its 5,226-acre West Hilo Tree Farm in Hawaii to raise cash to fund its Chapter 11 bankruptcy reorganization; -- the Debtor will turn back the title to the former U.S. Bureau of Land Management headquarters on Chad Drive, in Eugene, Oregon, which the Company bought for $5.1 million two years ago from a half-dozen individual investors. -- involves reducing the amount of secured debt the Company owes to Bank of America. Under the Plan, creditors and interest holders will be treated as follows: * Each secured creditor will retain its security interest in and liens on its Collateral with the same priority such security interest and liens had on the Petition Date. * Each holder of a "Small Unsecured Claim" will be paid the full amount of its Claim within 60 days following the Effective Date. * Each holder of a General Unsecured Claim will be paid the full amount of its General Unsecured Claim in Cash within five years after the Effective Date. In addition, within 3 years after the Effective Date the Reorganized Debtor will pay at least 50% of the principal amount of each General Unsecured Claim. Interest will accrue from the Petition Date on each General Unsecured Claim until such Claim is paid in full at a uniform annual interest rate of 3.5%. At the time the Reorganized Debtor makes any principal payment on a General Unsecured Claim, the Reorganized Debtor will also pay all accrued but unpaid interest then owing on the General Unsecured Claim. * Existing Interests in the Debtor will be preserved. A full-text copy of the Second Amended Disclosure Statement is available for free at http://ResearchArchives.com/t/s?759e A full-text copy op the Fourth Amended Chapter 11 Plan is available for free at http://ResearchArchives.com/t/s?759f About Arlie & Company Eugene, Oregon-based Arlie & Company -- http://www.arlie.com/-- is a property developer. It is doing business as DHF Corp., and formerly dba Arlie Land and Cattle Company and Crescent Village Community Gardens, LLC. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Ore. Case No. 10-60244) on Jan. 20, 2010. Pachulski Stang Ziehl & Jones LLP, and Ball Janik LLP, serve as the Debtor's bankruptcy counsel. The Company disclosed $227,191,924 in assets and $65,412,220 in liabilities as of the Chapter 11 filing. ART ONE: Asks for Court's Permission to Use Cash Collateral ----------------------------------------------------------- ART One Hickory Corporation seeks authority from the U.S. Bankruptcy Court for the Northern District of Texas to use rents and other charges generated by its property that constitute as Cathay Bank's cash collateral. The Debtor is obligated by two cross collateralized notes to its mortgage lender, Cathay Bank. The Debtor is obligated on the note secured by One Hickory Centre in the principal amount of $8,856,155. The indebtedness on the One Hickory Centre note, as modified, bears interest at the contract rate of 5.0%. The Debtor is obligated on the note secured by Two Hickory Centre in the principal amount of $9,171,208. The indebtedness on the Two Hickory Centre note bears interest at the contract rate of 7.18%. The Debtor's total mortgage obligation to Cathay is in the principal amount of $18,027,362. The Debtor estimates that it has approximately $3,972,638 in equity in the Property. At the respective contract rates for the One Hickory Centre and Two Hickory Centre notes, the total monthly payment of principal and interest is approximately $91,775. Because the mortgage grants a lien on the rents and other charges generated by the Property, Cathay has a lien on the Debtor's cash. Robert A. Simon, Esq., at Barlow, Garsek & Simon, L.L.P., explains that the Debtor needs access to the cash collateral to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/ART_ONE_budget.pdf In exchange for using the cash collateral, the Debtors propose to grant Cathay adequate protection liens to protect the Lender from the diminution in value of the collateral. Beginning on July 3, 2011, the Debtor will begin making monthly payments of adequate protection equal to the monthly interest on the mortgage indebtedness at the non-default contract rate, or approximately $91,000. The Debtor will keep the Property fully insured against loss and pay all delinquent property taxes. With Court approval, the Debtor will grant Cathay a replacement lien on all postpetition rents and common area maintenance charges, and other cost reimbursements collected from tenants to the extent and with the priority that such liens existed prepetition. About ART One Fort Worth, Texas-based ART One Hickory Corporation, aka ART Two Hickory Corporation owns two four-story office buildings in North Dallas, Texas. The first is located at 1800 Valley View Lane, Dallas, Texas 75234, and is approximately 102,612 square feet. The second is located at 1750 Valley View Lane, Dallas, Texas 75234, and is approximately 96,124 square feet. ART One filed for Chapter 11 bankruptcy protection on April 4, 2011 (Bankr. N.D. Tex. Case No. 11-42024). Robert A. Simon, Esq., at Barlow Garsek & Simon, LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. ASARCO LLC: Plan Admin. Wants Claims Objections Further Extended ---------------------------------------------------------------- Mark A. Roberts of Alvarez and Marsal North America LLC, the Reorganized Debtors' Plan Administrator, asks the U.S. Bankruptcy Court for the Southern District of Texas to extend the time by which he can file objections to claims pursuant to Section 14.2 of the Confirmed Plan of Reorganization and Rule 9006(b)(1)(1) of the Federal Rules of Bankruptcy Procedure. The last Court-approved Claims Objection Deadline was March 22, 2011. By this motion, the Plan Administrator seeks an extension of the Current Claims Objection Deadline, through and including the date upon which he files a motion for an order and final decree closing the ASARCO LLC bankruptcy case. The Plan Administrator seeks extension of the Claims Objection Deadline to ensure that no Disputed Claims that should be objected to are inadvertently allowed by the passage of time, Dion W. Hayes, Esq., at McGuirewoods LLP, in Richmond, Virginia, tells Judge Schmidt. The sought extension, Mr. Hayes asserts, will allow additional time to review the remaining unresolved claims to determine whether any additional objections should be filed. Mr. Hayes assures the Court that the Plan Administrator will continue to make distributions on Claims, as he has done routinely since the Plan Effective Date, promptly after those Claims become Allowed Claims. He adds that the Plan Administrator and Reorganized ASARCO will not use the extension of time to delay payment to Claimants, who are appropriately entitled to distributions under the Debtors' Confirmed Plan of Reorganization. A hearing will be held on April 28, 2011, to consider the request. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: CSM Wants to Bar Discovery of Settlement Data --------------------------------------------------------- The Colorado School of Mines asks the Bankruptcy Court for a protective order to prevent discovery of settlement-related information with regard to the Asarco LLC Plan Administrator's objection to its Claim No. 18309. Asimakis (Maki) D. Iatridis, Esq., at Berg Hill Greenleaf & Ruscitti LLP, in Boulder, Colorado, relates that Colorado School of Mines' claim seeks to recover environmental clean-up costs at the CSMRI Site in Golden, Colorado. He also relates that on March 3, 2011, the Plan Administrator issued subpoenas to five entities, who are potentially responsible parties at the Site. The initial deadline to produce documents pursuant to the Subpoenas was March 17, 2011. The Subpoenas seek settlement communications from PRPs, who engaged in and are engaging in settlement negotiations with Colorado School of Mines. Some of the settlement negotiations were through mediation. Between February 25 and March 16, 2011, counsel for Colorado School of Mines and the Plan Administrator conferred to determine and appropriately limit the scope of discovery to exclude mediation and settlement information. Counsel to the Plan Administrator initially indicated they were not seeking to obtain any materials excluded by Rule 26 of the Federal Rules of Civil Procedure or the Colorado mediation statute, according to Mr. Iatridis. However, on March 18, 2011, the Plan Administrator's counsel responded that the Plan Administrator would not exclude from the Subpoenas "documents related to settlement and/or mediation," Mr. Iatridis points out. "The [Plan Administrator] did not confer with Colorado before issuing the Subpoenas and his Subpoenas follow on the heels of his attempt to obtain this settlement information in his discovery requests to Colorado," Mr. Iatridis tells the Court. He reveals that Colorado School of Mines produced all settlement agreements, but did not produce settlement communications and set forth the reasons for its objections. Rather than resolve the issue with Colorado School of Mines or through the Court, the Plan Administrator attempted an end-run by issuing the Subpoenas to the PRPs with whom Colorado School of Mines has negotiated and is negotiating settlement, Mr. Iatridis contends. Mr. Iatridis also alleges that the Subpoenas were signed on March 2, 2011, and appear to have been served on the same day as the notice was served on Colorado School of Mines, in contrary to the requirement of Rule 45(b)(1) of the Colorado Rules of Civil Procedure that notice be provided "before" the Subpoenas are served. By this motion, the Colorado School of Mines seeks a protective order to stop discovery of settlement information from third parties not discoverable under Rule 26 and within the scope of Colorado School of Mines' mediation statute. Mr. Iatridis argues that the settlement information sought by the Subpoenas should not be disclosed because it is (i) irrelevant and not discoverable under the Federal Rules, and (ii) protected from disclosure by Colorado's mediation statute. In support of its Motion, Colorado School of Mines filed with the Court exhibits, which include letters from Total Gas & Power North America, Inc. and Elf Aquitaine, Inc., and NL Industries, Inc., objecting to the Subpoenas. Plan Administrator Reacts In connection with the contested matter between the Plan Administrator and Colorado School of Mines, the Plan Administrator served certain third party document subpoenas and provided notice of same to Colorado School of Mines in February 2011, Dion W. Hayes, Esq., at McGuirewoods LLP, in Richmond, Virginia, tells Judge Schmidt. In response to Colorado School of Mines' vague request that the Plan Administrator "exclude" from the scope of the Subpoenas certain unspecified documents "used and/or created" in certain mediation proceedings, counsel for the Plan Administrator declined the request, but clearly stated that the Plan Administrator "is not seeking through discovery to obtain materials that Rule 26 or the Colorado statute [Col. Rev. Stat. Section 13-22-307] prevents us from obtaining, if any," Mr. Hayes says. Colorado School of Mines took no action in response to that communication, but instead made another request to "exclude documents related to the settlement and/or mediation" in response to a second set of Subpoenas served in March, Mr. Hayes contends. He asserts that Colorado School of Mines was directed to the Plan Administrator's prior response and asked to contact the Plan Administrator's counsel "if you have any further questions regarding this matter." This time, Mr. Hayes says, without warning or consultation, Colorado School of Mines filed the Motion but failed to offer any explanation of what is meant by the undefined term "settlement information" or provide any analysis of how the information is "not discoverable" under the authority cited in the Motion. The Plan Administrator tells the Court that he objects to the Motion because Colorado School of Mines has failed to provide particular and specific demonstrations of fact in support of its relevance and confidentiality objections. The Plan Administrator also objects to the consideration of the Motion on an emergency basis because Colorado School of Mines has failed to show any emergency. * * * In an interim order, Judge Schmidt rules that: -- a hearing on the Motion will take place on April 28, 2011; -- the Plan Administrator voluntarily agrees not to enforce the Subpoenas during the period from March 28, 2011, through the Hearing solely with respect to settlement- related documents in full reservation of the Plan Administrator's right to contest the Motion at the Hearing. In all other respect, the Subpoenas remain in full force and effect; and -- within two business days after the entry of the Interim Order, the Plan Administrator will send a copy of the order to the parties, who received the Subpoenas or their counsel; and -- by April 11, 2011, the School of Mines will produce to the Plan Administrator a client-verified accounting showing all available information regarding all forms of consideration received from any third party on account of any alleged damages and expenses incurred by the School of Mines with respect to the Site, including the payors, the amount paid, the specific expenses to which the payments were applied and any portion of the Claim to which the payments have been applied. Prior to the entry of the Interim Order, Mr. Hayes informed the Court that the Plan Administrator's and the School of Mines' counsel were unable to agree on a form of the Interim Order that accurately reflects the Court's rulings at the March 28, 2011 hearing on the Motion. In response, the Colorado School of Mines asserted that the Plan Administrator's proposed Interim Order did not reflect the results of the March 28 hearing, nor its voluntary offer to produce certain limited information related to costs. Plan Administrator Seeks Documents from Colorado School of Mines In a separate filing, the Plan Administrator asks the Court to compel the Colorado School of Mines to produce certain documents that he has previously requested consisting of several categories of responsive non-privileged documents associated with the Colorado Claim. In a separate filing, the Plan Administrator asks the Court to compel the Colorado School of Mines to produce certain documents that he has previously requested consisting of several categories of responsive non-privileged documents associated with the Colorado Claim. The Plan Administrator served on October 8, 2010, the Colorado School of Mines with the Discovery, which seeks all documents relating to the Claim. After reviewing Colorado School of Mines' objections and conferring with it, counsel for the Plan Administrator traveled to Golden, Colorado, to inspect documents it held on February 9 through 10, 2011. The Plan Administrator notes that during and after the review, he specifically identified and requested responsive non-privileged documents not provided by Colorado School of Mines to date, but Colorado has not produced those documents to date. Similarly, the Plan Administrator relates that his attempts to engage Colorado School of Mines regarding electronic documents and privilege logs have been unsuccessful. At the present time, approximately six months after service of the Discovery, there remain several significant deficiencies with respect to Colorado School of Mines' responses to the Discovery, Mr. Hayes contends. Thus, the Plan Administrator asks Judge Schmidt to enter an order: (a) requiring the Colorado School of Mines to produce the Documents; (b) allowing the Plan Administrator to perform electronic searches in accordance with the parameters that it associated with the Discovery, including a proposed time period, a list of proposed custodians and a list of proposed search terms; and (c) requiring the Colorado School of Mines to amend its Privilege Logs to include sufficient information to determine whether the documents listed therein are in fact privileged. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ASARCO LLC: Victor Karl Objects to Summary Judgement Proceeding --------------------------------------------------------------- Victor Karl informed the Bankruptcy Court that he received a letter from Adam H. Garner, Esq., at McGuirewoods LLP, in Baltimore, Maryland, on behalf of Reorganized ASARCO LLC and the Plan Administrator. The e-mailed letter contains a copy of the Bankruptcy Court's scheduling order. Mr. Karl says that he and ASARCO participated in a lengthy motion for summary judgment proceeding leading up to the offer of judgment that ASARCO offered him in 2005 with respect to his claim for coverage in post-retirement group life insurance. He contends that it is unreasonable to subject him to another summary judgment proceeding as set forth in the Scheduling Order. "Yesterday marks the 9th anniversary of KARL filing a benefit claim with ASARCO with respect to his Group Life Insurance coverage. Thus now in the 10th year of dilatory tactics, ASARCO would add further delay to resolution of KARLs claims," Mr. Karl argues in his March 16, 2011 letter. "If that is not DISCRIMINATORY ANIMUS, KARL does know the meaning of the term as recently pronounced by the US Supreme Court in the Staub decision," he says. Mr. Karl asks the Bankruptcy Court to reconsider the Scheduling Order in relation to his claims. In the alternative, Mr. Karl withdraws his Claim No. 2857 in its entirety, and seeks leave from the Bankruptcy Court to pursue his claims in the New York District Court, in which the claims were initiated and which has accepted jurisdiction prior to the commencement of ASARCO's bankruptcy cases. In a separate filing, Mr. Karl says he also received discovery requests from the Plan Administrator. He opposes the Scheduling Order and says he does not intend to comply with the discovery requests. He emphasizes that the interests of judicial economy and efficiency would be served by his pursuit of his claims in the New York District Court, wherein appropriate relief and complete resolution of all causes of action and issues will receive a full and fair review. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection on August 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On December 9, 2009, Grupo Mexico, S.A.B., consummated the Chapter 11 plan that it sponsored for Asarco LLC. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated Asarco LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. Bankruptcy Creditors' Service, Inc., publishes ASARCO Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by ASARCO LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) BARNES BAY: Viceroy Anguilla Resort Unit Buyer Objects to Sale -------------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that the Viceroy Anguilla Resort & Residences on the island of Anguilla is facing opposition on its request before the U.S. Bankruptcy Court in Delaware for approval of procedures for selling the project. The objection goes to the heart of whether a U.S. court has power to sell property abroad free of liens and claims and in violation of an order from the foreign court. A buyer named RJR Viceroy Ltd. recited in a bankruptcy court filing how it's the beneficiary of a consent order entered in January 2010 by the High Court of Anguilla. The order prohibits the project owner from selling a specific unit until the prospective buyer is repaid its $2 million deposit. RJR cites case authority for the proposition that a court in the U.S. has no power to override a court order from another country where the subject property is located. RJR says the issue isn't merely a question of priority of liens on property. It has a valid court judgment from Anguilla, the theory goes, that prohibits sale absent repayment of the $2 million with interest. According to a court filing, the owner of the resort collected $49 million in deposits for the sale of 97 units. Not held in escrow, the deposits were used in operations. About Barnes Bay Beverly Hills, California-based Barnes Bay Development Ltd. owns the Viceroy Anguilla Resort & Residences on the British West Indies island of Anguilla. Barnes Bay and two affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-10792) on March 17, 2011. The Company disclosed that as of Dec. 31, 2010, it had $531 million in assets and $462 million in debt. Akin Gump Straus Hauer & Feld LLP is the Debtors' bankruptcy counsel, and Richards Layton & Finger, P.A., is the Delaware counsel. Kurtzman Carson Consultants LLC is the Debtors' claims, noticing, solicitation and balloting agent. The Debtor's Chapter 11 plan is intended to facilitate the sale of the Viceroy Anguilla Resort and Residences. BARNES BAY: Taps Richards Layton as Delaware Counsel ---------------------------------------------------- Barnes Bay Development Ltd., et al., ask the U.S. Bankruptcy Court for the District of Delaware for authorization to employ Richards Layton & Finger, P.A., as Delaware counsel, nunc pro tunc to the petition date. RL&F will, among others: i. prepare all necessary petitions, motions, applications, orders, reports and papers necessary to commence these chapter 11 cases; ii. advise the Debtors of their rights, powers and duties as debtors and debtors in possession under chapter 11 of the Bankruptcy Code; and iii. prepare on behalf of the Debtors all motions, applications, answers, orders, reports, and papers in connection with the Debtors estates. The principal professionals and paraprofessionals designated to represent the Debtors and their current standard hourly rates are as follows: Paul N. Heath, Esq. $550 per hour Chun I. Jang, Esq. $365 per hour Travis A. McRoberts, Esq. $280 per hour Janel Gates $200 per hour RL&F received a retainer in the amount of $50,000 on March 16, 2011, from the Debtors as compensation for professional services rendered and reimbursement for expenses incurred in connection with the commencement of these chapter 11 cases. The Debtors propose that the remainder of the retainer paid to RL&F and not expended for prepetition services and disbursements be treated as an evergreen retainer to be held by RL&F as security throughout these chapter 11 cases until RL&F's fees and expenses are awarded by final order and payable to RL&F. RL&F will work closely with Akin Gump Straus Hauer & Feld LLP, the Debtors' proposed bankruptcy counsel, and Keithley Lake & Associates, the Debtors' proposed special Anguillan counsel, to ensure that there is no duplication of effort with respect to each firm's respective duties. To the best of the Debtors' knowledge, information, and belief, RL&F does not hold or represent any interest adverse to the Debtors or their estates. The Debtors believe that RL&F is a "disinterested person," as defined in section 101(14) of the Bankruptcy Code. About Barnes Bay Beverly Hills, California-based Barnes Bay Development Ltd. owns the Viceroy Anguilla Resort & Residences on the British West Indies island of Anguilla. Barnes Bay and two affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-10792) on March 17, 2011. The Company disclosed that as of as of Dec. 31, 2010, it had $531 million in assets and $462 million in debt. Akin Gump Straus Hauer & Feld LLP is the Debtors' bankruptcy counsel, and Keithley Lake & Associates is the Debtors' special Anguillan counsel. Kurtzman Carson Consultants LLC is the Debtors' claims, noticing, solicitation and balloting agent. The Debtor's Chapter 11 plan is intended to facilitate the sale of the Viceroy Anguilla Resort and Residences. BARNES BAY: Proposes Akin Gump as Bankruptcy Counsel ---------------------------------------------------- Barnes Bay Development Ltd., et al., ask the U.S. Bankruptcy Court for the District of Delaware for authorization to employ Akin Gump Strauss Hauer & Feld LLP, as counsel, nunc pro tunc to the Petition Date. Akin Gump will, among others: i. render legal advice regarding the powers and duties of debtors that continue to operate their business and manage their properties as debtors in possession; ii. take all necessary action to protect and preserve the Debtors estates, including the prosecution of actions on the Debtors' behalf, the defense of any actions commenced against the Debtors, the negotiation of disputes in which the Debtors are involved, and the preparation of objections to claims filed against the Debtors estates; and iii. prepare on behalf of the Debtors, as debtors in possession, all necessary motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtors' estates and appear on Debtors' behalf at all hearings regarding the Debtors' cases. The current hourly rates charged by Akin Gump's professionals are: Partners $500-$1,200 Special Counsel and Counsel $410-$850 Associates $280-$510 Paraprofessionals $125-$300 Akin Gump received retainers totaling $325,000 on March 8, 2011, and March 16, 2011, of which $322,419.55 has been applied in satisfaction of the pre-petition fees and expenses incurred by Akin Gump from Jan. 14, 2011, through the Petition Date. The remaining balance of the retainer in the amount of $2,580.45 will be applied to such postpetition allowances of compensation and reimbursement of expenses, respectively, as may be granted by the Court. To the best of the Debtors' knowledge, Akin Gump does not hold or represent any interest adverse to the Debtors or their estates, and that the firm is a "disinterested person," as defined in section 101(14) of the Bankruptcy Code. The principal professionals and paraprofessionals designated to represent the Debtors and their current standard hourly rates are as follows: Paul N. Heath, Esq. $550 per hour Chun I. Jang, Esq. $365 per hour Travis A. McRoberts, Esq. $280 per hour Janel Gates $200 per hour About Barnes Bay Beverly Hills, California-based Barnes Bay Development Ltd. owns the Viceroy Anguilla Resort & Residences on the British West Indies island of Anguilla. Barnes Bay and two affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-10792) on March 17, 2011. The Company disclosed that as of as of Dec. 31, 2010, it had $531 million in assets and $462 million in debt. Richards Layton & Finger, P.A., is the Delaware counsel, and Keithley Lake & Associates is the Debtors' special Anguillan counsel. Kurtzman Carson Consultants LLC is the Debtors' claims, noticing, solicitation and balloting agent. The Debtor's Chapter 11 plan is intended to facilitate the sale of the Viceroy Anguilla Resort and Residences. BARNES BAY: Taps Keithley Lake as Special Counsel in Anguila ------------------------------------------------------------ Barnes Bay Development Ltd., et al., asks the U.S. Bankruptcy Court for the District of Delaware for authorization to employ Keithley Lake & Associates as special counsel in Anguila, effective as of the Petition Date. Because the Debtors' primary asset is located in Anguilla, the Debtors aver that the retention of Anguillan counsel is necessary to effectively manage any sale issues arising under Anguillan law and to assist with the sale of the Debtors' assets under both the laws of Anguilla and in full compliance with the Bankruptcy Code. The Debtors also seek authority to permit KLA to retain Anguilla Credit Management Limited as auctioneer for the Debtors' assets and Cushman & Wakefield Inc. as the appraiser for the Debtors' assets located in Anguilla. KLA professionals and paraprofessionals bill: Partners $600 Associates $375 Paraprofessionals $150 ACML will charge for its services on a fixed fee basis in accordance with its ordinary and customary fees in effect on the date such services are rendered. The fixed fee charged by ACML is anticipated to be $100,000. Cushman will charge for its services on a fixed fee basis in accordance with its ordinary and customary fees in effect on the date such services are rendered. The fixed fee charged by Cushman is anticipated to be $35,000. As special counsel being retained by the Debtors pursuant to Section 327(e), KLA is not subject to the disinterestedness standard of Section 101(14). Nevertheless, to the best of the Debtors' knowledge, the Debtors submit that KLA is a "disinterested person" as that term is defined in Sec. 101(14) of the Bankruptcy Code. The Debtors also submit that KLA does not hold any interests adverse to the Debtors or their estates. About Barnes Bay Beverly Hills, California-based Barnes Bay Development Ltd. owns the Viceroy Anguilla Resort & Residences on the British West Indies island of Anguilla. Barnes Bay and two affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11- 10792) on March 17, 2011. The Company disclosed that as of as of Dec. 31, 2010, it had $531 million in assets and $462 million in debt. Akin Gump Straus Hauer & Feld LLP is the Debtors' bankruptcy counsel, and Richards Layton & Finger, P.A., is the Delaware counsel. Kurtzman Carson Consultants LLC is the Debtors' claims, noticing, solicitation and balloting agent. The Debtor's Chapter 11 plan is intended to facilitate the sale of the Viceroy Anguilla Resort and Residences. BELTWAY 8: Plan Offers Full Payment to Unsecureds After One Year ---------------------------------------------------------------- Beltway 8 Associates, LP, dba Watermarke Apartments, filed with the U.S. Bankruptcy Court for the Middle District of Louisiana on April 4, 2011, a disclosure statement explaining its Chapter 11 Plan of Reorganization. The Plan contemplates payment of all allowed claims against the Debtor based upon the cash flow created through the Debtor's business operations. With respect to FST Watermarke, LLC's Secured Claim, on the Effective Date, all accrued unpaid interest calculated at the non- default contractual rate of 4% per annum plus any amounts allowed by the bankruptcy Court pursuant to 11 U.S.C. Sec. 506(b) will be capitalized and added to the outstanding principal balance of $21,250,000 due under the FST Watermarke Note. The maturity of the FST Watermarke Note will be extended to 60 months from the Effective Date. The Debtor will repay the New Principal Balance in equal monthly installments of principal and interest calculated based upon a 30-year amortization schedule with such payments to commence 30 days after the occurrence of the Effective Date. The entire remaining New Principal Balance and any unpaid accrued interest then due to the Class 2 Claim holder will be paid in full by the Debtor on or before the New Maturity Date. The Debtor believes that by allowing a 5-year extension of the loan with FST, Watermarke Apartments will have time to completely remove concessions (offered in prior years to maintain occupancies due to an oversupply issue in the submarket) from the market and achieve substantially higher rental rates. During that time, the property will have achieved a sufficient stabilized net operating income that will be able to obtain adequate refinance proceeds to pay off the Debtor's obligation to FST Watermarke. The total estimate of the Allowed Class 3 General Unsecured Claims is $2,200,736. Except with respect to the General Unsecured Claim held by 6444 Associates, L.L.C., each holder of an Allowed General Unsecured Claim will receive a cash payment from the Debtor on the Effective Date equal to 50% of its Allowed General Unsecured Claim. The remaining balance of each Allowed General Unsecured Claim will then bear interest from the Effective Date until paid at the rate of 4% per annum. The remaining balance of principal and accrued interest due to each such holder of an Allowed General Unsecured Claim will then be due and payable by the Debtor as a lump sum payment one year after the occurrence of the Effective Date. By voting in favor of confirmation of this Plan, the holder of the General Unsecured Claim of 6444 Associates, L.L.C., will be deemed to have consented to the following less favorable treatment of its General Unsecured Claim as Allowed: the holder thereof will not receive any payments by virtue of such claim until all Unclassified Claims and all other Allowed General Unsecured Claims have been paid in full and the Debtor is current on all payments to FST Watermarke under Class 2. If all of the aforesaid conditions are satisfied, the Debtor will repay the holder thereof in equal monthly installments of principal and interest accruing from the Effective Date at a rate of 4% per annum calculated based upon a 30-year amortization schedule. The entire balance of principal and accrued unpaid interest due to the holder of the General Unsecured Claim of 6444 Associates, L.L.C., will balloon and become due and payable 72 months after the occurrence of the Effective Date. Although the Holders of Equity Interests under Class 4 will retain those interests after confirmation, no distributions may be made to the Holders of such Equity Interests by virtue of same unless the following conditions have been met: (a) all Unclassified Claims have been paid in full; (b) all other Allowed General Unsecured Claims other than the claim of 6444 Associates, L.L.C. have been paid in full as provided by this Plan; and, (c) the Debtor is current on all payments to the holder of the Class 2 Claim and the claim of 6444 Associates, L.L.C. as required by this Plan. A complete text of the Disclosure Statement is available for free at http://bankrupt.com/misc/beltway8.DS.pdf About Beltway 8 Baton Rouge, Louisiana-based Beltway 8 Associates, LP, dba Watermarke Apartments, owns and operates Watermarke Apartments, a 280 unit residential apartment complex located on approximately 15.6 acres in Houston, Texas. It filed for Chapter 11 bankruptcy protection (Bankr. M.D. La. Case No. 11-10001) on Jan. 3, 2011. Patrick S. Garrity, Esq., and William E. Steffes, Esq., at Steffes, Vingiello & McKenzie, LLC, in Baton Rouge, La., serve as the Debtor's bankruptcy counsel. Judge Douglas D. Dodd presides over the Chapter 11 case. The Debtor disclosed $25.3 million in assets and $25.4 million in liabilities as of the Chapter 11 filing. BERNARD L MADOFF: Trustee May Disclose Bank Officers' Identities ---------------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that a bankruptcy judge in Manhattan ruled April 12 that the trustee for Bernard L. Madoff Investment Securities Inc. can disclose previously secret portions of complaints filed against financial institutions. In February, the New York Times and several television outlets of NBC Universal LLC asked U.S. Bankruptcy Judge Burton R. Lifland to unseal redacted portions of the Madoff trustee's complaints. According to Mr. Rochelle, Judge Lifland, in his ruling April 12, evidently intends for the trustee to unseal almost all of the complaints except information about JPMorgan Chase & Co.'s know- your-customer rule and anti-money-laundering procedures. Judge Lifland is also allowing charities to keep the complaints secret. Revealing their details could "seriously jeopardize the financial viability" of the charities or their "ability to raise donations," he said. The Bloomberg report notes that although his order is vague, Judge Lifland apparently intends for the banks to disclose the names of employees and executives named in the papers, even though it would be "embarrassing or prejudicial" for the individuals to be associated with the Madoff Ponzi scheme. Citibank NA, UBS AG and Natixis wanted the judge to keep their employees' identities secret. Reliance International Research LLC was apparently rebuffed in its effort to maintain secrecy about "the identity of one of its owners." Judge Lifland, Mr. Rochelle relates, said there is a "strong presumption" that court filings are publicly available documents. Court papers can remain secret only if they are "scandalous" or "defamatory," and none were in the Madoff case, he said. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping $50 billion. On Dec. 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 Feb. 18, 2011, a total of $6.85 billion in claims by investors has been allowed, with $791.1 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. BION ENVIRONMENTAL: Has Project With Kreider to Cut Ammonia ----------------------------------------------------------- Bion Environmental Technologies believes its partnership with Kreider Farms in Lancaster County, Pennsylvania, is an example of how agriculture will be a leader in helping solve the nation's environmental challenges. Bion made this announcement in response to an April 6th petition, filed on behalf of several environmental groups, urging the US EPA to issue a national ambient air quality standard (NAAQS) for ammonia gas. The Bion/Kreider Farms project will demonstrate that the choice is not simply between "clean air, water and a healthy environment or CAFO's." This 1200 cow dairy project will demonstrate that livestock agriculture, including CAFO's, can operate in a manner that is consistent with clean air, water and a healthy environment. A CAFO, properly managed, can operate as a necessary and productive element of our economy, generating safe environmental impacts. The Bion/Kreider project will show a significant (over 75%) reduction of ammonia from the dairy's 1200 cows. These nitrogen reductions will be based upon measurements taken in accordance with an approved verification plan. They will result in verified credits for nitrogen reductions to the Chesapeake Bay, due in large part to the reductions of ammonia at Kreider Farms. Bion's mass balance measurements will include the nitrogen components that exist in the livestock waste stream and are lost to the environment PRIOR to application to cropland. This is substantially different than the present measurement approach that only considers the nitrogen that is applied to the cropland. Bion's facility will both define the extent of the total nitrogen releases to the water run-off system, including ammonia, and provide the technology to mitigate the releases at their livestock source. Bion's project at Kreider Farms, a voluntary effort on the part of all the various stakeholder groups, demonstrates that a cost effective solution to the environmental impacts associated with livestock waste is possible. This $7.8 million project was financed by the Pennsylvania Infrastructure Investment Authority after a thorough review process by the Pennsylvania Department of Agriculture. Bion has met with the US EPA and has had a continuing dialogue with various environmental groups, such as PennFuture, to provide a transparent understanding of the project and its goals. The project is a part of Pennsylvania's overall response to the Chesapeake Bay mandate. While the results of this partnership represent a victory for both the farm and the environment, the real winner associated with the project will be the Pennsylvania taxpayer. Ed Schafer, Bion's Director of Government Policy, points out that "Providing a low cost alternative to the traditional rate payer-funded approach of expanding nutrient removal capacity at water treatment plants can save taxpayers millions of dollars in rate hikes." Bion is convinced that environmental sustainability cannot be achieved at the expense of economic sustainability. The Kreider Farms project demonstrates that livestock agriculture can provide a cost effective solution to the excess nitrogen issue that affects the nation's large water basins. About Bion Environmental Crestone, Colo.-based Bion Environmental Technologies, Inc. (OTC BB: BNET) -- http://biontech.com/-- has provided environmental treatment solutions to the agriculture and livestock industry since 1990. Bion's patented next-generation technology provides a unique comprehensive treatment of livestock waste that achieves substantial reductions in nitrogen and phosphorus, ammonia, greenhouse and other gases, as well as pathogens, hormones, herbicides and pesticides. The Company's balance sheet at Dec. 31, 2010, showed $3.5 million in total assets, $2.9 million in total liabilities, $2.5 million in Series B Redeemable Convertible Preferred stock, and a stockholders' deficit of $1.9 million. As reported in the Troubled Company Reporter on September 27, 2010, GHP Horwath, P.C., in Denver, Colo., expressed substantial doubt about Bion Environmental Technologies' 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 not generated revenue and has suffered recurring losses from operations. BLOCKBUSTER INC: Landlords Object to Proposed Sale Order -------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that numerous Blockbuster Inc. landlords filed objections to the proposed order formally approving the sale of the business to Dish Network Corp. Landlords contend that some language in the proposed order either inadvertently or intentionally would prevent them from enforcing rights under leases when locations are transferred to Dish. Mr. Rochelle relates that the bankruptcy court will hold a hearing on April 14 to resolve disputes over the order approving the auction where Englewood, Colorado-based Dish made the highest offer with a gross bid of $320 million. The Wall Street Journal's Kris Hudson said last week the possible shuttering of many of Blockbuster's stores is yet more bad news for retail landlords who have been battered for months by a weak economy and anemic demand for space. But looking on the bright side: it could be worse. The Journal said retail landlords bracing for the closure of what could be hundreds of Blockbuster stores expect to find tenants for many of the locations, which are relatively small, well located and appealing to a wide range of users. Blockbusters range from 3,000 to 7,000 square feet. "I don't hear a lot of crying about getting back Blockbuster space," says John Johannson, senior vice president for Minneapolis-based real-estate company Welsh Cos., which owns, manages and brokers retail real estate, according to the Journal. Welsh had two Blockbusters that closed in centers it owns, and another two in centers where it oversees leasing. Sue Chang, writing for Marketwatch, Dish expects to close its acquisition of Blockbuster on April 25. Blockbuster creditors are expected to receive about $227 million from the deal, according to Dish. Steven Russolillo, writing for Dow Jones Newswires, reports that Dish's winning bid for Blockbuster could put it on a path to compete with Netflix Inc., although significant hurdles remain. Dow Jones relates Dish plans to utilize the assets to enhance Dish's subscription offerings, leading some observers to predict it will start streaming video and shipping DVDs. 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 Inc. and 12 U.S. affiliates initiated Chapter 11 bankruptcy proceedings with a pre-arranged reorganization plan in Manhattan (Bankr. S.D.N.Y. Case No. 10-14997) on Sept. 23, 2010. It disclosed assets of $1 billion and debts of $1.4 billion at the time of the filing. 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. 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. The Bank of New York Trust Company, N.A., as trustee under that certain indenture, dated as of Aug. 20, 2004, with respect to the 9% Senior Subordinated Notes due 2012 issued by Blockbuster Inc., is represented by Edward P. Zujkowski, Esq., at Emmet, Marvin & Martin, LLP. The Ad Hoc Studio Committee of Blockbuster Inc. et al. is represented by Robert J. Feinstein, Esq., at Pachulski Stang Ziehl & Jones LLP. Blockbuster on Feb. 21, 2011, entered into an Asset Purchase and Sale Agreement providing for the sale of substantially all of their assets or the proceeds of those assets to a newly formed entity named Cobalt Video Holdco LLC. For purposes of entering into the Purchase Agreement, the Purchaser was established by Monarch Alternative Capital LP, Owl Creek Asset Management LP, Stonehill Capital Management, LLC, and Varde Partners, Inc. who collectively hold more than 50% of the Senior Secured Notes and each of which is a member of the Steering Committee. Cobalt Video Holdco LLC, the stalking horse purchaser, was represented by Mark Shinderman, Esq., at Milbank, Tweed, Hadley & McCloy LLP. The auction was held earlier this month and Dish Network Corp. won with an offer having a gross value of $320 million. Dish said it expects to pay $228 million cash after adjustments for Blockbuster's cash and inventory. BORDERS GROUP: U.S. Trustee Opposes $8-Mil. in Bonuses for Execs. ----------------------------------------------------------------- Tracy Hope Davis, the U.S. Trustee for Region 2, objects to Borders Group's request to pay over $8 million in bonuses to their executives and other deemed key employees. The U.S. Trustee says the move is premature. Despite the characterization of the bonus payments as providing necessary incentives to insiders, there is no information that explains what extra services the insiders would perform beyond their ordinary job duties or a detailed description of the nexus between the supposed incentives and the payment trigger, Susan D. Golden, Esq., trial attorney, in New York, argues. "Given the timing of the Incentive Motion and its expedited hearing, it is apparent that the Key Employee Incentive Plan is really a disguised retention plan for insiders, which also provides for discriminatory bonuses for non-insiders," the U.S. Trustee alleges. Ms. Golden contends that the Incentive Motion provides no financial information metrics nor are the bonuses tied to the number of stores that will continue to operate under a plan of reorganization. Moreover, she adds, it is still unclear at this stage whether there will be any distribution to unsecured creditors. With respect to the proposed bonuses under the Key Employee Retention Plan, the Debtors have failed to demonstrate that the individuals that fall under the KERP are not insiders, the U.S. Trustee continues. The Debtors' failure to provide specific information regarding the names, job descriptions and reporting relationships of each person they propose to pay under the KERP renders the U.S. Trustee and other creditors unable to make a reasonable determination as to whether the characterization of non-insider status to each individual is appropriate, Ms. Golden says. The U.S. Trustee also objects to the Incentive Motion because the Debtors have failed to meet their evidentiary burden of proof to show that the proposed bonus payments comply with Section 503(c) of the Bankruptcy Code. * * * Borders spokesperson Mary Davis told The Wall Street Journal, "The proposed programs were designed to retain key executives at Borders as we proceed through the Chapter 11 reorganization process, and we are actively working to address the questions that have been raised." The Court will consider the Incentive Motion on April 14, 2011. About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BORDERS GROUP: Reaches Deal with Committee on Sutherland Contract ----------------------------------------------------------------- Borders Group, Sutherland Global Services, Inc., and the Official Committee of Unsecured Creditors jointly sought and obtained entry of a stipulated order resolving the Debtors' Motion to Approve Sutherland Contact Agreements. As reported in the March 17, 2011 edition of the Troubled Company Reporter, Borders Group Inc. and its units sought the Bankruptcy Court's permission to: (i) enter into a statement of work agreement and master services agreement with Sutherland Global Services, Inc.; and (ii) pay a $781,250 prepetition claim owed to Sutherland. The Committee, however, raised certain issues with the Debtors and Sutherland concerning the relief sought in the Debtors' Motion. Accordingly, the parties agreed that: (1) Pursuant to Section 363(b) of the Bankruptcy Code, the Debtors are authorized to enter into a Master Service Agreement with Sutherland as set forth in the Debtors' Motion; (2) The Debtors will pay Sutherland $420,774 on account of Sutherland's prepetition unsecured claim; (3) The remainder of Sutherland's prepetition claim, the sum of $360,476, is deemed an allowed general unsecured claim in the Debtors' bankruptcy cases and Sutherland is not required to file a proof of claim on behalf of that allowed claim. If any prepetition contracts between Sutherland and the Debtors relating to Sutherland's prepetition claim are assumed by the Debtors, then that prepetition claim will be treated in accordance with Section 365 of the Bankruptcy Code; (4) Sutherland acknowledges that it has no other prepetition claims against the Debtors and their estates and that it will not file or assert other prepetition claims in the Debtors' bankruptcy cases; and (5) The Debtors and their estates waive any claims that may be asserted against Sutherland to recover any alleged preferential transfer pursuant to Section 547(b) of the Bankruptcy Code or other applicable law. In July 2010, Borders Group, Inc. entered into a Letter of Intent with Sutherland Global Services, Inc. and Sutherland Global Services Philippines, Inc., whereby Sutherland was obligated to initiate and incorporate Borders' customer service calls into Sutherland's outsourced contact center in the Philippines. Pursuant to the LOI, Sutherland established a "Level One," English-speaking customer call contact center that provided support for Borders' rewards and loyalty programs, Borders.com inquiries and other customer service related inquiries. Sutherland also provided other support, including technological assistance, cataloguing and retaining customer emails and other Web site correspondences. The LOI expressly provided that it did not constitute a complete and final agreement; instead, the LOI would serve as a bridge agreement while the parties negotiated a more comprehensive master services agreement. The LOI was supposed to terminate by September 7, 2010, unless the parties were able to enter into a master services agreement or enter into a further extension. In September 2010, the Debtors and Sutherland agreed to extend the LOI Termination Date through, and including, October 22, 2010. The parties then continued to negotiate the terms of a master services agreement, but did not enter into another extension. Nonetheless, since the Petition Date, the parties have continued to operate in accordance with the LOI and the Debtors have been pre-paying for Sutherland's services. Services & Operating Agreements The Debtors and Sutherland have now agreed in principle on the forms of a Master Services Agreement and a Statement of Work Agreement or SOW, which the parties will execute upon obtaining Court permission. The MSA is an umbrella agreement that provides the formal contractual terms to govern the Debtors' and Sutherland's relationship under the SOW. In addition to more formally outlining the services and the compensation structure, the MSA outlines the parties' rights and remedies, including termination rights and notice requirements. The SOW is an operating agreement that governs Sutherland's operation of the Philippines Contact Center. Under the SOW, Sutherland is obligated to provide certain services, including: (i) fielding incoming phone and email customer service inquiries; (ii) managing the toll-free number; (iii) managing customer care resolution, including check and refund requests; (iv) processing Web site and phone gift card purchases; (v) fulfilling Borders.com invoices; and (vi) handling damaged and unsettled goods. The SOW will expire on October 17, 2013. Full-text copies of the forms of the MSA and SOW are available for free at: http://bankrupt.com/misc/Borders_SutherlandMSA.pdf http://bankrupt.com/misc/Borders_SutherlandSOW.pdf As of the Petition Date, the Debtors owe Sutherland $781,250 for services rendered in connection with operating the Philippines Contact Center. The Sutherland Claim is comprised of: -- $685,444 for customer service related production charges, -- $68,205 for electronic and eReader related charges, -- $12,375 for training and development related charges, and -- $15,225 for reimbursement of expenses for services rendered from December 2010 through January 2011. Andrew K. Glenn, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York -- AGlenn@kasowitz.com -- tells the Court that Sutherland has indicated that it will not enter into any of the Contact Agreements unless and until the Sutherland Claim is paid in full. Sutherland has also stated its intention to terminate all services if the Debtors do not pay the Sutherland Claim. Mr. Glenn asserts that providing and maintaining the Philippines Contact Center is an integral component to maintain the Debtors' operations. The Debtors rely heavily on Sutherland to provide this service, he stresses. Finding a replacement for Sutherland could take many months, Mr. Glenn emphasizes. Any interruption in obtaining the services provided at the Philippines Contact Center, he insists, would: (i) damage the Debtors' business reputation; (ii) undermine the Debtors' ability to provide a phone or web vehicle for customer complaints and questions, which is necessary to retain customer and store loyalty; and (iii) adversely and irreparably affect the Debtors' restructuring efforts. Against this backdrop, the Debtors ask to Court to grant critical vendor status on Sutherland. The Debtors further ask the Court that any order approving their motion with respect to Sutherland be made effective immediately by waiving the 14-day stay under Rule 6004(h) of the Federal Rules of Bankruptcy Procedure. About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BORDERS GROUP: Wins Approval to Modify Trade Terms With Vendors --------------------------------------------------------------- In the ordinary course of business, Borders Group acquire goods based on trade credit terms that were negotiated on a vendor-by- vendor basis. The Debtors had the right to return books and magazines at the invoiced cost as a credit towards future invoices from the applicable vendor. As the Debtors' financial difficulties were publicized, many vendors refused to provide any trade credit or accept returns. Instead, vendors began demanding cash in advance or cash on delivery terms for deliveries to the Debtors. Many publishers refused to ship the Debtors merchandise under any terms, causing the Debtors to seek inventory replenishment using alternative channels. Before the Petition Date, the Debtors returned approximately 31% of their merchandise annually for Return Credit. The Debtors now seek to reduce the amount of goods returned to vendors to better manage their inventory, Andrew K. Glenn, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, tells the Court. The Debtors also want to return to an ordinary course business relationship with their vendors, which would include returning merchandise, he reveals. To make vendors comfortable with their individual credit decisions, the Debtors have discussed the imposition of caps on merchandise to be returned during these Chapter 11 cases, according to Mr. Glenn. The Debtors, he notes, have also discussed returning goods acquired prepetition for postpetition credit for the purchase of new inventory at a value equal to or greater than the cost value of the returned inventory. These transactions will be referred to as the Postpetition Credit Returns. Accordingly, the Debtors sought and obtained the Court's permission to modify the trade terms and return prepetition merchandise to vendors for postpetition credit. In an abundance of caution, and at the request of certain vendors that are requiring the Court's approval as a condition to providing new trade terms to the Debtors and allowing the Debtors to assume ordinary course merchandise returns, the Debtors seek confirmation from the Court that they are authorized to enter into vendor agreements that may require caps on returned goods -- Return Limits. The Debtors also sought confirmation from the Court that the Postpetition Credit Returns will not violate Section 546(h) of the Bankruptcy Code. Mr. Glenn contends that Section 546(h) does not apply in the current case because the Debtors will not "offset the purchase price of such goods against any claim of the creditor against the debtor that arose before the commencement of the case." Nevertheless, to the extent Section 546(h) does apply, the Debtors seek Court approval to utilize Postpetition Credit Returns to the extent goods delivered prepetition are returned for credit solely against future invoices for new inventory at equal or greater cost value. Essentially, the Postpetition Credit Returns are in the best interests of the Debtors' estates because they afford the Debtors the flexibility to return prepetition goods on the same basis as postpetition goods, Mr. Glenn asserts. Given that it may be difficult to differentiate goods based on their date of acquisition, the Postpetition Credit Returns will not afford preferential treatment to any creditors, he assures the Court. About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BORDERS GROUP: Borders Properties' Schedules and Statement ---------------------------------------------------------- Borders Properties Inc. Schedules of Assets and Liabilities A. Real Property - B.2 Bank Accounts PNC Bank - Payroll Controlled Disbursement Account $0 PNC Bank - Account Opened for Tax Purposes 0 B.13 Stock and interests Undetermined See http://bankrupt.com/misc/BPISchedB13StockInterests.pdf B.16 Accounts receivable Intercompany receivable Borders, Inc. 447,250,959 Borders International Services, Inc. 681,854 Borders Direct, LLC 466,672 Borders/JGA JV LLC 82,704 Borders Group, Inc. (50,460,159) B.18 Other liquidated debts Tax receivable - NC - fiscal year end 2009 35 B.22 Patents, copyrights, and other intellectual property Undetermined See http://bankrupt.com/misc/BPISchedB22Patents.pdf B.23 Licenses, franchises Undetermined See http://bankrupt.com/misc/BPISchedB23Licenses.pdf TOTAL SCHEDULED ASSETS $398,022,066 =========================================================== D. Creditors Holding Secured Claims Secured Debt Bank of America, N.A. $196,469,250 GA Capital, LLC 48,919,244 TOTAL SCHEDULED LIABILITIES $245,388,494 =========================================================== Statement of Financial Affairs Borders Properties, Inc. disclosed that it made payments, totaling $556,548,070, to creditors within 90 days immediately preceding the Petition Date, a schedule of which is available for free at http://bankrupt.com/misc/BPI_SofA3b.pdf Borders Senior Vice President of Restructuring Holly Etlin disclosed that Borders Properties also made payments, totaling $48,423,388, to insiders within one year immediately before the Petition Date, a schedule of which is available for free at: http://bankrupt.com/misc/BPI_SofA3c.pdf Borders Properties also made payments related to debt counseling or bankruptcy, totaling $9,673,650, within one year immediately preceding the Petition Date, a schedule of which is available for free at http://bankrupt.com/misc/BPI_SofA9.pdf These officers kept the Debtor's books and records within two years immediately preceding the Petition Date: Name Title ---- ----- Glen Tomaszewski Vice President Scott D. Henry Chief Financial Officer Mark R. Bierley Former Chief Financial Officer Messrs. Tomaszewski and Henry were in possession of the books and records of the Debtor at the time of the commencement of its Chapter 11 case. Ernst & Young LLP audited the books and records of the Debtor within two years immediately preceding the Petition Date. The Debtor's current officers and stockholders who directly or indirectly own or hold 5% or more of the voting or equity securities of the Debtor are: Nature of % of Stock Stock Name/Title Ownership Ownership ---------- --------------- --------- Borders, Inc. Legal Ownership 100% Of Wholly Owned Subsidiary Jason D. Cline N/A N/A Vice President Michael J. Edwards N/A N/A President and CEO Scott D. Henry N/A N/A Executive Vice President, Chief Financial Officer, & Treasurer Edward J. Jackson N/A N/A Vice President, Assistant Treasurer & Assistant Secretary Glen Tomaszewski N/A N/A Vice President The Debtor's former officers are: Name Title ---- ----- Kathryn M. Popoff Vice President David S. Laverty Vice President Mark R. Bierley Executive Vice President, Chief Financial Officer, & Treasurer Thomas Carney Executive Vice President & Secretary About Borders Group Borders Group is a leading operator of book, music and movie superstores and mall-based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders- branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. Two of Borders' flagship stores (along with other less prominent stores) are located in Manhattan. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e- commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. National law firm Lowenstein Sandler has been appointed to represent the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group has sought approval to sell merchandise and owned furniture, fixtures and equipment located at approximately 200 of their stores and, at Borders' option, up to 75 of 136 potential other stores, through store closing sales. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000) BRSP LLC: S&P Assigns 'BB-' Rating on $282MM Sr. Secured Term Loan ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'BB-' rating to BRSP LLC's $282 million senior secured term loan due July 2014. The recovery rating is "1", indicating very high (90% to 100%) recovery of principal in the event of a default. The outlook is stable. A preliminary 'BB-' rating was assigned to the loan in October 2010 and this is a delayed notification of the finalized rating following a document review. Fixed lease payments from Calpine Corp. provide for debt service payments on the term loan. Given that Calpine is also the owner and lessor of the assets and there is no ring-fencing structure, the default risk is the same as that of Calpine; thus, the rating on the debt reflects recovery prospects as well. BRUGNARA PROPERTIES: Disclosure Statement Hearing Set for May 12 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of California continued the hearing until May 12, 2011, at 1:30 p.m., to consider the adequacy of the first amended disclosure statement explaining the first amended Chapter 11 plan of reorganization of Brugnara Properties VI. Under the Plan, funding of the payments to Class 1 Secured Claim of Wachovia will come from funds Debtor will need to raise from its principal. The Debtor anticipates that the payment to Class 2 Secured Claim of Jorei Enterprises LLC, which is not due for four years, will come via a refinance or sale of the Real Property. Payments to all General Unsecured Claims will come from an infusion of capital from Debtor's principal. The disbursing agent will distribute funds on account of the allowed claims pursuant to the terms of the Plan. The disbursing agent will also be responsible for reserving amounts for payment of any disputed claims until such time that the disputed claims are either disallowed or become allowed claims. The allowed Class 1 claim will have two treatment options from which to select. Under Option A, the claim will be deemed a $5,000,000 claim as of the Confirmation. The claim will accrue interest at 4% per annum. Payments will be interest only, and the debt shall be due in full 10 years from the Confirmation. Under Option B, the claim will be allowed in its full amount owed, $6,140,000 and will accrue interest at 3% interest only, due in 10 years. Under Options A and B, the loan will be deemed reinstated upon Confirmation. If the Class 1 claim does not select an option, it will be deemed to have selected Option A. The allowed Class 2 claim will be treated pursuant to the terms of the settlement agreement between Debtor and Jorei. Pursuant to that agreement the claim shall be due in four years and will not accrue interest, except as provided in the settlement agreement. The Class 3 claims will receive a pro rata share of $1,000 to be distributed three months from the effective date of the Plan. The Class 4 interest holders will not receive any distributions under the Plan. A full-text copy of the Disclosure Statement, as amended, is available for free at http://ResearchArchives.com/t/s?759d About Brugnara Properties VI San Francisco, California-based Brugnara Properties VI owns a real property located at 224 Sea Cliff Avenue, San Francisco, California. The Company filed for Chapter 11 protection (Bankr. N.D. Calif. Case No. 10-33637) on Sept. 17, 2010. The Company disclosed $17,800,000 in assets and $11,667,750 in liabilities as of the Chapter 11 filing. BRYAN/MOORE DEV'T: Court Dismisses Chapter 11 Bankruptcy Case ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona dismissed the Chapter 11 bankruptcy case of Bryan/Moore Development LLC. According to the Debtor, dismissal of the case is in the best interest of creditors as creditors will be paid immediately upon dismissal of the case, and dismissal will avoid further administrative expenses to the estate. The Debtor reminds the Court that in February, it sold its property, which sale permitted the Debtor to pay its largest secured creditor, Bank of America, in full. The Debtor said it now holds in the debtor in possession bank account in excess of $800,000 from which to satisfy additional creditor claims. The Debtor's schedules indicate that the total amount of non-insider unsecured debt is less than $65,000. The Debtor also owes approximately $45,000 in attorney's fees and costs incurred postpetition. The Debtor says that upon dismissal of the case, it would promptly pay each of its debts, and, therefore, there is no need to remain in this chapter 11 proceeding and continue to incur administrative expenses. About Bryan/Moore Development Mesa, Arizona-based Bryan/Moore Development, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 10- 09233) on March 31, 2010. McGuire Gardner P.L.L.C. represents the Debtor in the Chapter 11 case. The Company scheduled $15,525,000 in assets and $13,166,621 in liabilities as of the Chapter 11 filing. CALUMET SPECIALTY: S&P Puts 'B' Rating on Proposed $375MM Notes --------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B' issue rating (same as the corporate credit rating) to Calumet Specialty Products Partners L.P.'s proposed $375 million senior unsecured notes due 2019. "The recovery rating on the notes is '3', indicating our expectation for meaningful recovery (50% to 70%) in the event of a payment default," S&P related. Calumet plans to use the proceeds from the notes to repay all outstanding borrowings under subsidiary Calumet Lubricants Co., L.P.'s senior secured term loan facility due 2015. As of Dec. 31, 2010, about $367 million was outstanding. The ratings on Indianapolis-based Calumet Specialty Products Partners L.P. reflect the improved near-term outlook for the highly volatile refining and marketing industry, elevated debt leverage, small scale of operations, and limited discretionary cash flows given its master limited partnership (MLP) structure. The ratings also reflect expectations for continued favorable margins on specialty products, improving liquidity, and modest near-term capital spending needs. "The outlook on Calumet is stable. We expect Calumet to maintain adequate liquidity despite weak fuel margins, and that capital spending and distributions should remain largely within operating cash flows. We could lower ratings if liquidity falls below $65 million, or adjusted debt leverage exceeds 4.5x for a prolonged period. At this time, we do not anticipate any positive rating actions on the company given its limited scale of operations, and remaining concern about industry-wide operating margins beyond 2011," S&P noted. Ratings List Calumet Specialty Products Partners LP Corporate credit rating B/Stable/-- Calumet Specialty Products Partners LP Calumet Finance Corp. New Rating $375 mil senior notes due 2019 B Recovery rating 3 CASCADE ACCEPTANCE: Court Denies Farella's $66T Bill ---------------------------------------------------- Farella Braun Martel LLP was counsel to the Creditors' Committee when Cascade Acceptance Corporation's case was in Chapter 11, and was awarded over $400,000 in compensation for its services during that time. Farella Braun has filed an application for an additional $54,049 for services and $2,077 for costs for the period from July 13, 2010 -- following the July 12, 2010 conversion of the Debtor's case to Chapter 7 -- through Jan. 31, 2011. The application seeks compensation for "services performed for the Committee in light of the Conversion Motion, and other post-Conversion Date work for the Committee, as well as preparation of the Chapter 11 Fee Application, and (successfully) responding to objections thereto by certain Insiders." One creditor has filed an objection. In an April 4, 2011 Memorandum, Bankruptcy Judge Alan Jaroslovsky denied the application. A copy of his ruling is available at http://is.gd/Axitlrfrom Leagle.com. About Cascade Acceptance Mill Valley, California-based Cascade Acceptance Corporation filed for Chapter 11 bankruptcy protection (Bankr. N.D. Calif. Case No. 09-13960) on Nov. 23, 2009. Douglas B. Provencher, Esq., at Law Offices of Provencher and Flatt, assisted the Company in its restructuring effort. The Company estimated $50 million to $100 million in assets and debts. In July 2010, Judge Jaroslovsky converted the Chapter 11 case to one under the Chapter 7 of the Bankruptcy Code. CATHOLIC CHURCH: Jesuits Settle Abuse Claims for $166 Million ------------------------------------------------------------- A $166 million settlement was reached in the bankruptcy case of The Society of Jesus, Oregon Province, or the Jesuits, to resolve the claims of hundreds of victims of clergy sexual abuse. Pfau Cochran Vertetis Amala PLLC, in Seattle, Washington, posted on its Web site at http://www.pcvalaw.com/a statement regarding the settlement. The firm represents more than a hundred of the claimants. PCVA's Statement The Society of Jesus, Oregon Province (commonly referred to as "the Jesuits"), has agreed to pay $166 million to settle the claims of hundreds of victims of clergy sexual abuse. The claims span a 30-year period, from the 1950s to the 1980s, and include victims across a five-state region, including Washington, Oregon, Idaho, Montana and Alaska. Most victims still live in the region. The settlement of more than 500 individual claims, the result of over a year of negotiations, is believed to be the single- largest, clergy sex-abuse bankruptcy settlement in the United States. It is also the first bankruptcy among the ten Jesuit provinces nationwide. While a number of Catholic Dioceses have filed for bankruptcy, including the Spokane Diocese, the Jesuits are the first religious order to seek bankruptcy protection. The Oregon Province covers Washington, Idaho, Montana, Oregon, and Alaska. Seattle sexual abuse attorney Michael Pfau, Esq., who represents 150 of the victims and played a role in brokering the settlement, said the money for victims, while significant, is secondary in importance to exposing wrongs and forcing change. "It took courage for the men and women we represent to come forward, tell their story and challenge such a powerful institution," Mr. Pfau said. "Some of our clients were battling the Jesuits and their denials in court for years before the bankruptcy." Although Mr. Pfau has represented hundreds of victims of clergy sexual abuse, he believes the bankruptcy will shed further light on what he perceives as a problem of institutional neglect. "The staggering number of victims who have come forward in the bankruptcy process underscores the extent of the widespread problems within the Jesuit order in the Pacific Northwest. Our clients and their communities deserve answers and deserve closure, and this settlement is a big step toward accomplishing those goals." A steering committee of seven victims and their attorneys began negotiating with the Jesuits and its main insurer several months ago. The same committee will recommend to all claimants that the offer be accepted. Under the terms of the proposed settlement agreement, approximately 70 percent of the payout will come from insurance assets. The remaining 30 percent will be paid directly by the Oregon Province. While the payment plans are still being worked-out, the tentative agreement proposes that all claimants, including those who are not presently represented by an attorney, will be allowed to choose between two payment allocation plans. It also proposes that claimants have the option to share their personal stories with a claims reviewer who will be selected by representatives from the steering committee. For many, this will be an opportunity to talk about what happened to them and how it affected their lives. According to Mr. Pfau, this process is similar to what he and other attorneys negotiated after the Spokane Diocese declared bankruptcy, and it is aimed at accomplishing similar goals. "While all of our clients came forward because they want to hold the Jesuit leadership accountable for decades of bad decisions, an important part of the healing process is allowing them to take ownership of what happened and share their story. This process should provide our clients with a means to do so." Filed in February 2009, the case revealed a shocking number of abuse victims on Native American reservations in Washington, Idaho, and Montana, where the Jesuits ran boarding schools until the mid-1970s. Dozens of victims also came forward from remote villages in Alaska, including many who were orphans or were placed under the care of the Jesuits because their parents were too poor to take care of them. "The victims represent some of the poorest and most vulnerable children in the Pacific Northwest," Mr. Pfau said. "We have long suspected the Jesuits used remote villages in Alaska and small towns near reservations in the Pacific Northwest as a place to send its abusive and problem priests, including known pedophiles. The evidence and personal stories that have emerged from this bankruptcy process show the Native American children paid the heavy price for that reckless disregard of children and others." The sheer number of victims suggests the problem was endemic throughout the five-state region. More than 500 men and women came forward and documented the sexual abuse they allegedly suffered. While dozens of Jesuit priests and authority figures are implicated in the scandal, accusations against some priests were staggering. For example, more than sixty-six individual claims were filed over allegations of sexual abuse by Father Morse, a Jesuit priest who served at St Mary's Mission near Omak Washington. Other Jesuit abusers sought refuge at college campuses. For example, a number of boys have accused the late Reverend John Leary, a former president of Gonzaga University in Spokane, Washington, of sexually abusing them during his tenure at the school. Meanwhile, other claimants alleged that after he was accused of molesting a young boy in Spokane, Jesuit officials secretly moved a popular and charismatic priest, Reverend Michael T. Toulouse, to Seattle University. While at that school, Mr. Pfau's clients allege that Toulouse sexually abused the boys in his car, on trips and at various parishes throughout the Seattle area. In 2005, Mr. Pfau successfully convinced Jesuit officials at the school to discontinue an honorary Toulouse memorial lecture series after he confronted them with new allegations of sexual abuse by the priest. Although the bankruptcy court has lifted a confidentiality order on the tentative settlement, it will likely take several months before the Jesuits begin to compensate victims. The settlement must first be approved by a sufficient majority of individual claimants, and then by the bankruptcy court. According to Mr. Pfau, the settlement agreement also contemplates compensation for victims who have not yet come forward. While every case is different, it is often difficult for victims of childhood sexual abuse to come forward because it means they must confront a part of their life that they have been trying to put behind them. The settlement agreement will resolve claims against the Oregon Province, but it does not end claims against other Jesuit institutions that chose not to participate in the settlement negotiations. For example, Jesuit colleges Gonzaga University and Seattle University refused to participate because they claimed their assets were separate from the Oregon Province, even though both schools are operated by the Jesuits. After the settlement, both colleges will still face claims and lawsuits, including a trial involving eight boys molested by Father Michael Toulouse. That trial was continued when the Jesuits filed for bankruptcy protection, but Mr. Pfau, who represents eight of the boys, believes it will now likely be rescheduled for trial in 2012. For more information, contact Michael T. Pfau at (206) 462- 4335 (work), 206-794-2882 (cell), or michael@pcvalaw.com. Or visit http://www.pcvalaw.com/jesuitbankruptcy. Society of Jesus, Oregon Province Top 10 Worst Alleged Offenders and Number of Claims Filed Against Each (of 141 alleged abusers and 500+ claims of abuse) Name and Location Number of Claims of Alleged Abuse Filed Against Each ---------------- ------------------ Deacon Joseph Lundowski (Alaska) 69 Fr. John J. Morse (Washington) 66 Unidentified Priests, Nuns and Workers 55 Fr. A. J. "Freddy" Ferretti (Idaho) 34 Br. Charlie aka Rene Gallant (Montana) 28 Fr. George Endal (Alaska) 25 Mother Loyola (St. Ignatius Mission Boarding School, Montana) 24 Fr. Anton Smario (Alaska) 20 Fr. Bernard A. Harris (Montana) 20 Fr. Jules Convert (Alaska) 19 Bankruptcies by Roman Catholic Institutions Due to Abuse Claims At least eighth Roman Catholic diocese in the U.S. have filed for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. The last to file for bankruptcy was The Catholic Archdiocese of Milwaukee, in Wisconsin, which filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: Wilmington Diocese to Lay Off Employees -------------------------------------------------------- Bishop W. Francis Malooly of the Catholic Diocese of Wilmington, Inc., reveals in a memorandum for Diocesan employees that an Amended Plan of Reorganization may be presented on April 15, 2011, for consideration by the U.S. Bankruptcy Court for the District of Delaware. Bishop Malooly says that attorneys for the Official Committee of Unsecured Creditors have recently returned redraft of the Amended Plan with their requests and comments for changes, and the Diocese's counsel are currently doing another redraft with those changes. In his memorandum dated April 4, 2011, Bishop Malooly explains that because of its settlement with abuse claimants, which requires the Diocese to contribute $77.425 million to a Settlement Trust, the Diocese's capacity to continue to operate Diocesan ministries at current levels is significantly reduced. He emphasizes that cuts must be made in the fiscal year 2012 budget, which in turn require the Diocese to reduce staff based on a set of priorities. Every ministry or office was required to reduce budgets; most budgets of offices and agencies were reduced 25% or more over the current year's expected expenditures, Bishop Malooly says. "This unfortunately will cause us to initiate a series of lay-offs, a most unfortunate circumstance," he adds. "The ending of people's jobs with the Diocese is a difficult decision, and one made only with the greatest reluctance. I express my regret to those who will be let go effective July 1 of this year," Bishop Malooly says in the memorandum. "I have asked our Human Resources Office to assist those having to leave us to help them in preparing resumes and to offer advice and counsel in their search for new employment," he continues. Robert Krebs, spokesman for the Diocese, says that the memorandum had not yet been circulated to all employees, and the Diocese would not be making any statement on the cutbacks until "after we get a chance to talk to everyone," The News Journal reports. He notes that the reductions would not affect parishes or Catholic schools. He explains that the Diocese remains committed to protecting its educational, charitable and spiritual activities, as Bishop Malooly said in February. "And most of that happens on the parish level," Mr. Krebs said, adding the cutbacks are all focused on the diocesan level. A full-text copy of the memorandum is available for free at: http://bankrupt.com/misc/Church_W_Memo_04042011.pdf Solicitation Exclusivity Ends June 20 Judge Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware extended the Catholic Diocese of Wilmington, Inc.'s exclusive periods to: (a) file a Chapter 11 plan of reorganization through and including the final statutory deadline of April 19, 2011; and (b) solicit acceptances of that plan through and including the final statutory deadline of June 20, 2011. About the Diocese of Wilmington The Diocese of Wilmington covers Delaware and the Eastern Shore of Maryland and serves about 230,000 Catholics. The Delaware diocese is the seventh Roman Catholic diocese to file for Chapter 11 protection to deal with lawsuits for sexual abuse. Previous filings were by the dioceses in Spokane, Washington; Portland, Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and San Diego, California. The Diocese filed for Chapter 11 on Oct. 18, 2009 (Bankr. D. Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Diocese. The Ramaekers Group, LLC, is the financial advisor. The petition says assets range $50 million to $100 million while debts are between $100 million to $500 million. The bankruptcy filing automatically stayed eight consecutive abuse trials scheduled in Delaware scheduled to begin October 19, 2009. There were 131 cases filed against the Diocese, with 30 scheduled for trial, as of the bankruptcy filing. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CATHOLIC CHURCH: Milw. Proposes to Modify Cemetery Staff CBA ------------------------------------------------------------ The Archdiocese of Milwaukee and the Cemetery Employees, Local 113, Laborers International Union of America, AFL-CIO, jointly ask the United States Bankruptcy Court for the Eastern District of Wisconsin to approve certain modifications to their collective bargaining agreement. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, tells Judge Kelley that the request marks the culmination of consensual collective bargaining negotiations that began prior to the commencement of the bankruptcy case, and reflects the longstanding positive relationship between the Archdiocese and the Cemetery Union Employees. The Diocese employs in the aggregate 177 employees, of whom 17 are Cemetery Union Employees, whose terms of employment are governed by the Labor Agreement between the Archdiocese and the Union dated April 1, 2008. For several months, before and after the Petition Date, the Archdiocese and the Cemetery Union Employees negotiated modifications to the CBA and terms for their future employment, Mr. Diesing relates. He notes that the tentative agreement resulting from the negotiations was unanimously approved by the Union bargaining team and was ratified by the Cemetery Union Employees. The Modifications provide modest wage increases in 2012 and 2013, increased employee contributions to the Cemetery and Mausoleum, Employees' Union Pension Plan, and a revised life insurance benefit, Mr. Diesing discloses. The Modifications also revise the Post-Accident Testing protocols and a portion of the Grievance Procedure, and extend the CBA to March 31, 2013. The Modifications draw an appropriate balance between the Archdiocese's needs and the rights of the employees, Mr. Diesing asserts. He contends that the continued employment of the Cemetery Union Employees, who have significant skills and institutional knowledge, is critical for all stakeholders in the case. He adds that the Modifications will facilitate a reorganization plan, while ensuring that the Cemetery Union Employees will enjoy continued employment. Objections or responses to the request are due April 21, 2011. About the Archdiocese of Milwaukee The Diocese of Milwaukee was established on November 28, 1843, and was elevated to an Archdiocese on February 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) CATHOLIC CHURCH: CBNA Appeals District Court Arbitration Order -------------------------------------------------------------- Robert L. Berger, in his capacity as Settlement Trustee in the bankruptcy case of the Catholic Bishop of Northern Alaska, notified the U.S. District Court for the District of Alaska that he will take an appeal to the United States Court of Appeals for the Ninth Circuit from the order issued by the U.S. District Court for the District of Alaska regarding the motion for summary judgment and motion to compel arbitration entered on March 3, 2011. The U.S. District Court for the District of Alaska previously adopted in their entirety the proposed findings of fact and conclusions of law submitted by the U.S. Bankruptcy Court for the District of Alaska with respect to the second motion for partial summary judgment and the motion to compel arbitration filed by Catholic Mutual Relief Society of America in the adversary proceeding commenced by the Catholic Bishop of Northern Alaska against Catholic Mutual and other insurers. In line with the recommendations in the Proposed Findings, District Court Judge Ralph R. Beistline ruled that: -- Catholic Mutual's second motion for partial summary judgment is granted; -- Catholic Mutual has no duty to defend the Diocese or Robert L. Berger, in his capacity as the Settlement Trustee, with respect to the 22 Proofs of Claim that are based on sexual abuse alleged to have occurred during the period from April 15, 1979, to April 15, 1983; -- Catholic Mutual's motion to compel arbitration and stay proceedings related to post-1990 abuse claims pending arbitration is granted, in part, and denied, in part; -- all claims based on acts of sexual abuse that are alleged to have occurred on or after July 1, 1990, must be submitted to arbitration in accordance with the provisions of the insurance certificate issued by Catholic Mutual for the period from July 1, 2008, through July 1, 2009; and -- Catholic Mutual's request for a stay pending arbitration is denied, without prejudice to renewal should the circumstances materially change. Appeal Schedule Molly C. Dwyer, Clerk of the Appellate Court, notified parties of these schedules: July 13, 2011 Deadline for filing of Appellant's opening brief and excerpts of record will be served and filed. August 12, 2011 Deadline for filing of Appellee's answering brief and excerpts of record will be served and filed. About the Diocese of Fairbanks The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka The Diocese of Fairbanks, aka CBNA -- http://www.cbna.info/-- filed for Chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its restructuring efforts. Michael R. Mills, Esq., of Dorsey & Whitney LLP serves as the Debtor's local counsel and Cook, Schuhmann & Groseclose Inc. as its special counsel. Judge Donald MacDonald, IV, of the United States Bankruptcy Court for the District of Alaska presides over Fairbanks' Chapter 11 case. In its schedules, the Debtor disclosed total assets of $13,316,864 and total liabilities of $1,838,719 as of the Petition Date. The Bankruptcy Court entered its order confirming the "Debtor's and the Official Committee of Unsecured Creditors' Third Amended and Restated Joint Plan of Reorganization for the Catholic Bishop of Northern Alaska" on February 17, 2010. The effective date of the Plan occurred on March 19, 2010. In November 2010, Judge Donald MacDonald IV entered a final decree and order closing the Chapter 11 case of the Catholic Bishop of Northern Alaska. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CELLO ENERGY: Court Rules on Suit Against Parsons & Whittemore -------------------------------------------------------------- Pre-bankruptcy, Cello Energy LLC was involved in litigation with Parsons & Whittemore Enterprises Corporation, in the District Court for the Southern District of Alabama. P&W's first lawsuit against Cello -- Cello I -- was filed in 2007. Before the jury rendered a verdict in Cello I, P&W filed a second lawsuit -- Cello II -- against Cello, Boykin Trust, Vesta Venture, Forest Technologies, Jack Boykin, Lois Boykin, Allen Boykin, and Elisa Rambo on Sept. 25, 2009, seeking to avoid fraudulent transfers made by members of the Boykin family and the entities they control, and seeking to pierce the corporate veil. The District Court held a trial in Cello II on Sept. 27-29, 2010. Before the District Court issued its ruling in Cello II, Cello Energy, Jack Boykin, and Boykin Trust filed bankruptcy petitions. Those cases were administratively consolidated on Dec. 3, 2010. On Oct. 25, 2010, P&W filed a Motion for Relief from Stay to Continue Resolution of Prepetition Multi-party Litigation. Relief from the automatic stay was granted on Dec. 7, 2010, with two conditions: (1) the stay was to remain in effect as to injunctive relief sought by P&W in Cello II and (2) P&W was not authorized to execute on any judgment without further order of the Bankruptcy Court. On Feb. 3, 2011, the District Court entered an order in Cello II finding that P&W is entitled to recover these amounts on its fraudulent transfer claims, constructive fraud claims, and actual fraud claims: $700,000 against Boykin Trust; $399,923 against Jack Boykin; $510,000 against Lois Boykin; and a total of $695,000 against Allen Boykin. With regards to P&W's piercing the corporate veil claims, the District Court found that P&W is entitled to recover $10,431,560.50 from Lois Boykin and Allen Boykin jointly and severally. The Order also stated that P&W is only entitled to recover from Cello, Boykin Trust, Allen Boykin, Jack Boykin, and Lois Boykin, jointly and severally, a net total amount of $10,431,560.50 for these findings and for the jury award in the previous Cello I litigation. On March 6, 2011, Cello, Boykin Trust, and Jack Boykin commenced an adversary proceeding against P&W seeking a preliminary injunction order restraining P&W from initiating actions to collect on its judgment against Lois Boykin. P&W objected on March 11, 2011, arguing that Lois Boykin is a non-debtor and requesting that the Court deny the application for a preliminary injunction. The case is Cello Energy, LLC, et al., v. Parsons & Whittemore Enterprises Corporation, Adv. Pro. No. 11-00031 (Bankr. S.D. Ala.). A hearing on the Preliminary Injunction request was held March 29, 2011. At the hearing, Jack Boykin testified that he is the owner and CEO of Cello and that he is the Chairman of Boykin Trust. He testified that his home is owned by Lois Boykin and that they share their home with their son, Allen, and a granddaughter of whom Allen has joint custody. He testified that he spends 100% of his time working on the reorganization of the debtor entities or in developing new contract opportunities with other companies. After the hearing, the Debtors filed a Motion to Certify Question to the Court of Appeals seeking to have the Alabama Supreme Court address "the unresolved issue of whether Alabama law permits a representative of a debtor corporation to bring an alter ego claim against the corporation's former principal." The Debtors raise two arguments in support of the Motion for Preliminary Injunction. First they argue that the Court should use the powers granted to it under 11 U.S.C. Sec. 105 to enter a preliminary injunction against P&W collecting on its debt from Mrs. Boykin. Second, they argue P&W improperly asserted the fraudulent transfer and piercing the corporate veil claims in Cello II because those causes of action are property of the bankruptcy estate. In his April 7, 2011 Order, available at http://is.gd/NUnyeifrom Leagle.com., Bankruptcy Judge Margaret A. Mahoney granted in part, and denied in part, the Debtors' request for a Preliminary Injunction and Temporary Restraining Order. The Court held that the Debtors have not met their burden of showing they have a substantial likelihood of success on the merits. They also have not met their burden of showing that there will be irreparable harm if the motion to issue a preliminary injunction against P&W collecting on its debt from Lois Boykin is denied. The Debtors' Motion to Certify is also denied. While there does not appear to be a direct Alabama case on this exact point of law, the Court said its decision is based on the general and widely accepted principles that govern alter ego claims. It is the opinion of the Court that these general principles serve as a sufficient basis on which to resolve the issue of whether to issue a preliminary injunction against P&W's collection efforts against Lois Boykin, and it is unnecessary at this time to certify the question to the Alabama Supreme Court. If the District Court or the Eleventh Circuit find that it is appropriate to certify the question, it is within their purview to do so. About Cello Energy Cello Energy LLC filed for Chapter 11 protection (Bankr. S.D. Ala. Case No. 10-04877) on Oct. 19, 2010, in Mobile, Alabama. It estimated assets of less than $50,000 and liabilities of $10 million to $50 million. Marcus E. McDowell, Esq. -- mmcdowell@wbblaw.com -- at Weiss, Buell & Bell, serves as counsel to the Debtor. CHAMPION ENVIRONMENTAL: Case Summary & Creditors List ----------------------------------------------------- Debtor: Champion Environmental Services, Inc. 38 West End Drive Gilberts, IL 60136 Bankruptcy Case No.: 11-15354 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: A. Benjamin Goldgar Debtor's Counsel: Scott R. Clar, Esq. CRANE HEYMAN SIMON WELCH & CLAR 135 S Lasalle Suite 3705 Chicago, IL 60603 Tel: (312) 641-6777 Fax: (312) 641-7114 E-mail: sclar@craneheyman.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/ilnb11-15354.pdf The petition was signed by Dominic Gorniak, president. CHEM RX: Creditors Win Confirmation of Liquidating Plan ------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that the creditors' committee for Chem Rx Corp. gained approval of a liquidating Chapter 11 plan when a U.S. Bankruptcy Judge in Delaware signed a confirmation order on April 11. As reported in the Troubled Company Reporter on Jan. 11, 2011, Canadian Imperial Bank of Commerce, New York Agency, as administrative agent for the first lien lenders, and the official committee of unsecured creditors for Chem Rx Corp. filed with the U.S. Bankruptcy Court a Joint Plan of Liquidation and related Disclosure Statement for Chem Rx. The central component of the Plan is the compromise and settlement of the Committee Litigation and any and all Claims and Estate Causes of Action by the Creditors Committee on behalf of the Debtors' Estates as of the Effective Date against the Secured Lenders and the First Lien Agent, subject to the occurrence of the Effective Date. Additionally, the Plan contemplates the establishment of a Litigation Trust to prosecute Estate Causes of Action. The Plan proposes the following treatment for the various claims and interests in the Debtor: Class 1. Priority Claims. Unimpaired. Paid in full in Cash, without interest. Class 2. Other Secured Claims. Impaired. Each holder of an Allowed Other Secured Claim will receive, at the option of the First Lien Agent (a) Cash equal to the net proceeds of the sale or disposition of the Collateral securing that holder's Allowed Other Secured Claim, without interest; or (b) the Collateral; or (c) such other Plan distribution necessary to satisfy the requirements of the Bankruptcy Code. Class 3. Secured Lender Claims. Impaired. Each holder of an Allowed Secured Lender Claim will receive: a. its Pro Rata share of (i) 100% of the Available Proceeds; (ii) beneficial interests in the Litigation Trust; and (iii) any Assets of the Debtors remaining on the Effective Date, except for (x) the Consummation Account, (y) Causes of Action and (z) the Litigation Trust Reserve. b. upon satisfaction of all Allowed Administrative Claims, Allowed Priority Claims, Allowed Priority Tax Claims and Allowed Other Secured Claims, its Pro Rata share of the amounts remaining in the Consummation Account, provided that the Plan Administrator will be Entitled to deduct certain amounts as provided under the Plan. c. tax refunds or any other refund of any kind or nature. d. the releases to the Released Claims. Class 4. General Unsecured Claims. Impaired. Holders of Allowed General Unsecured Claims will receive their Pro Rata share of the beneficial interests in the Litigation Trust and receive Litigation Trust Distributions in accordance with and pursuant to Section 6.3.9 of the Plan and the terms of the Litigation Trust Reserve on the Effective Date. Class 5. Subordinated Claims. Impaired. Holders of Subordinated Claims will receive, upon full payment of Secured Lender Claims, Secured Lender Deficiency Claims and Second Lien Lender Claims, any remaining interest in the Litigation Trust Distributions. Class 6. Equity Interests. Impaired. All Equity Interests will be deemed canceled and extinguished, and the holders will not receive any Plan or Litigation Distribution, or be entitled to retain any property or interest in property. The Available Proceeds refer to the Cash on hand in the Manufacturers and Traders Trust Company (M&T) Account, the Escrow Account held by Greenberg Traurig LLP, and the Wells Fargo Account on the Effective Date, immediately following the funding of the Consummation Account and the Litigation Trust Reserve pursuant to terms of the Plan. The Consummation Account means the account to be established by the Plan Administrator on the Effective Date which will be funded (a) first, from funds in the M&T Account at the Effective Date; and (b) thereafter, in an amount up to a maximum of $4.6 million, (i) first, from the funds remaining in the Escrow Account on the Effective Date and (ii) finally, from the funds available in the Wells Fargo Account on the Effective Date. The Litigation Reserve refers to the money market account to be established by the Litigation Trustee and funded in the amount of $2 million on the Effective Date. A copy of the First Amended Plan of Liquidation is available for free at: http://bankrupt.com/misc/ChemRx.BlacklinedCommitteeDS.pdf About Chem RX Corp. Long Beach, N.Y.-based Chem RX Corporation, aka Paramount Acquisition Corp. -- http://www.chemrx.net/-- is a major institutional pharmacy serving the New York City metropolitan area, as well as parts of New Jersey, upstate New York, Pennsylvania and Florida. The Company and five affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 10-11567) on May 11, 2010. Dennis A. Meloro, Esq., and Scott D. Cousins, Esq., at Greenberg Traurig, LLP, in Delaware, represent the Company in its restructuring. Cypress Holdings, LLC, is the Company's financial advisor. RSR Consulting, LLC, is the Company's chief restructuring officer. Brunswick Group LLP is the Company's public relations consultant. Grant Thornton LLP is the Company's independent auditor. Lazard Middle Market LLC is the Company's investment banker. Eichen & Dimeglio PC is the Company's tax advisor. Kurtzman Carson Consultants is the Company's claims and notice agent. Attorneys at White & Case and Fox Rothschild LLP serve as co-counsel to the Official Committee of Unsecured Creditors Chanin Capital Partners LLC serves as Restructuring and Financial Advisor for the Official Committee of Unsecured Creditors. The Company disclosed $169,690,868 in assets and $178,281,128 in debts as of Feb. 28, 2010. Chem Rx changed its name to CRC Parent Corp. following the sale of its business to PharMerica Corp. at a bankruptcy court-sanctioned auction. PharMerica paid $70.6 million and assumed specified liabilities. The deal enabled PharMerica to move into the New York and New Jersey markets. CHRISTIAN KNUDSEN: Ch. 7 Trustee to Probe Former Bankr. Counsel --------------------------------------------------------------- Christian S. Knudsen, Jr.; Michael G. Rinn, the Chapter 7 trustee for Mr. Knudsen's bankruptcy case; the Office of the U.S. Trustee; and Sirody, Frieman & Feldman, Mr. Knudsen's counsel when his case was still under Chapter 11, entered into a stipulation resolving two contested matters (a) the Motion of the U.S. Trustee to Further Extend Deadline for Objecting to Discharge, and (b) the Motion of Chapter 7 Trustee for Rule 2004 Examination and for Production of Documents, and the responses to those motions. The Chapter 7 Trustee made demand upon Sirody to turn over its entire file to the Chapter 7 Trustee, asserting that any privilege of the Debtor had been waived. Sirody refused the Chapter 7 Trustee's demand absent Court order or the prior written consent of the Debtor. A copy of the stipulation, approved by Bankruptcy Judge James F. Schneider on April 7, is available at http://is.gd/l7yHGF from Leagle.com. About Christian S. Knudsen Christian S. Knudsen, Jr., filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 09-13170) on Feb. 26, 2009, represented by Jeffrey M. Sirody, Esq. -- smeyers5@hotmail.com -- at Sirody, Freiman & Feldman. In his petition, Mr. Knudsen listed $1 million to $10 million in assets and debts. Sirody Frieman acted as the Debtor's bankruptcy counsel until March 3, 2010, whereupon a Notice of Substitution of Counsel was filed withdrawing Sirody Frieman's appearance as counsel. On May 20, 2009, at the behest of the U.S. Trustee, the Court entered an order converting the Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. Michael G. Rinn was appointed Chapter 7 Trustee. The Chapter 7 Trustee is represented by: Joseph J. Bellinger, Esq. OFFIT KURMAN, P.A. 8171 Maple Lawn Boulevard, Suite 200 Maple Lawn, MD 20759 Tel: 301-575-0300 Fax: 301-575-0335 E-mail: jbellinger@offitkurman.com Mr. Knudsen is represented by: James Vidmar, Esq. LOGAN, YUMKAS, VIDMAR & SWEENEY, LLC 2530 Riva Road, Suite 400 Annapolis, MD 21401 Tel: (410) 571-2780 E-mail: jvidmar@loganyumkas.com Sirody Freiman is represented by: Gary S. Poretsky, Esq. SIRODY, FREIMAN & FELDMAN P.C. 1777 Reisterstown Road Suite 360, Commercentre East Baltimore, MD 21208 Tel: (410) 415-0445 Fax: (410) 415-0744 E-mail: garyp@sfflegal.com CINRAM INTERNATIONAL: S&P Lowers Corporate Credit Rating to 'D' --------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its long- term corporate credit rating on Scarborough, Ont.-based Cinram International Inc. to 'D' (default) from 'CC'. Standard & Poor's also lowered its issue-level rating on the company's senior secured bank facility to 'D' from 'CC'. "We are withdrawing our issue-level and recovery ratings on IHC Corp. as there is no longer any debt at this subsidiary," S&P stated. "In addition, we are removing all ratings on Cinram from CreditWatch, where they had been placed with negative implications Jan. 27, 2011," S&P noted. "The downgrade follows the completion of the company's refinancing and recapitalization transaction on April 11, 2011, for its credit facilities due May 2011," said Standard & Poor's credit analyst Lori Harris. "We consider the refinancing to be a distressed exchange offer and tantamount to a default under our criteria definition as lenders were asked to agree to exchange a portion of the previous first-lien secured debt into lower priority second- lien debt, as well as to a maturity extension on most of the debt," Ms. Harris added. The transaction included a cash repayment of US$30 million on Cinram's first-lien secured term debt at closing and an extension of the maturity date of most of the bank debt to December 2013 from May 2011. In addition, US$90 million of first-lien debt was exchanged for second-lien payment-in-kind debt that is mandatorily exchangeable into equity on Dec. 31, 2011, if not repaid earlier from equity proceeds. "We expect to raise the corporate credit and issue-level ratings on Cinram, representative of our assessment of its improved credit risk post the refinancing and recapitalization transaction, in the very near term," S&P added. CLUB VENTURES: Court Okays Klestadt & Winters as Panel's Counsel ---------------------------------------------------------------- The Official Committee of Unsecured Creditors of Club Ventures Investments LLC and its debtor-affiliates received the U.S. Bankruptcy Court for the Southern District of New York's permission to retain Klestadt & Winters LLP as its counsel. The firm will, among other things: a) advise the Committee with respect to its rights, duties, and powers in this case; b) review, analyze and respond, as necessary, to all applications, orders, statements, and schedules filed with the Court; c) review, analyze and respond, as necessary, to any and all liens asserted against the Debtors' assets; d) assist the Committee in its consultations with the Debtors relative to the administration of this case; and e) assist the Committee in analyzing the claims of the Debtors' creditors and in negotiations with such creditors. Tracy L. Klestadt, Esq., partner at the firm, charges $595 per hour. The firm's other partners bill between $425 and $595 per hour; associates bill between $195 and $375 per hour; and paralegals bill at $150 per hour. About Club Ventures New York-based Club Ventures Investments LLC, aka DavidBartonGym, is a boutique gym company. Club Ventures owns DavidBartonGym, an operator of upscale health clubs in four cities. Founded in 1992 by David Barton, DavidBartonGym has grown to operate health clubs in New York, Miami, Chicago, and Seattle (Bellevue). Club Ventures and its affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-10891) on March 2, 2011. Club Ventures estimated its assets at $10 million to $50 million and debts at $50 million to $100 million. David B. Shemano, Esq., at Peitzman, Weg & Kempinsky LLP, in Los Angeles, serves as the Debtors' bankruptcy counsel. CMHA/TCB LAUREL: Wants to Tap David Donnett for Tenant Evictions ---------------------------------------------------------------- CMHA/TCB Laurel Homes I Limited Partnership and CMHA/TCB Laurel Homes V Limited Partnership ask for authorization from the U.S. Bankruptcy Court for the Southern District of Ohio to employ David D. Donnett, Esq., as special counsel. Mr. Donnett will perform tenant evictions on behalf of Debtors. Mr. Donnett proposes to perform legal services and be reimbursed for court costs at the rate of $195-$225 per case. In addition, any time spent over and above simple eviction proceedings are billed at Mr. Donnett's hourly rate of $175. To the best of the Debtor's knowledge, Mr. Donnett is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About CMHA/TCB Laurel CMHA/TCB Laurel Homes I Limited Partnership and CMHA/TCB Laurel Homes V Limited Partnership own and operate phases of the City West Housing Development located in the West End of Cincinnati. The Laurel Homes I and Laurel Homes V phases of the City West Housing Development, together with all other phases of the City West Housing Development, are managed by The Community Builders, Inc. CMHA/TCB V filed for Chapter 11 bankruptcy protection on March 31, 2011 (Bankr. S.D. Ohio Case No. 11-11966). Charles M. Meyer, Esq., at Santen & Hughes, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliate CMHA/TCB I Limited Partnership filed a separate Chapter 11 petition on March 31, 2011 (Bankr. S.D. Ohio Case No. 11- 11953). CMHA/TCB LAUREL: Taps Santen & Hughes as Bankruptcy Counsel ----------------------------------------------------------- CMHA/TCB Laurel Homes I Limited Partnership and CMHA/TCB Laurel Homes V Limited Partnership each filed applications for authorization from the U.S. Bankruptcy Court for the Southern District of Ohio to employ Santen & Hughes as bankruptcy counsel. Santen & Hughes can be reached at: Charles M. Meyer, Esq. Santen & Hughes 600 Vine Street, Suite 2700 Cincinnati, OH 45202 Tel: (513) 852-5986 Fax: (513) 721-0109 E-mail: cmm@santen-hughes.com Santen & Hughes will bill the Debtor pursuant to the hourly rates of its professionals: Charles M. Meyer $370 Deepak K. Desai $260 To the best of the Debtors' knowledge, Santen & Hughes is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About CMHA/TCB Laurel CMHA/TCB Laurel Homes I Limited Partnership and CMHA/TCB Laurel Homes V Limited Partnership own and operate phases of the City West Housing Development located in the West End of Cincinnati. The Laurel Homes I and Laurel Homes V phases of the City West Housing Development, together with all other phases of the City West Housing Development, are managed by The Community Builders, Inc. CMHA/TCB V filed for Chapter 11 bankruptcy protection on March 31, 2011 (Bankr. S.D. Ohio Case No. 11-11966). The Debtor estimated its assets and debts at $10 million to $50 million. Affiliate CMHA/TCB I Limited Partnership filed a separate Chapter 11 petition on March 31, 2011 (Bankr. S.D. Ohio Case No. 11- 11953). CRYSTAL CATHEDRAL: Court OKs BSW as Committee's Fin'l Consultant ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California authorized Official Committee of Unsecured Creditors of Crystal Cathedral Ministries to employ BSW & Associates as its financial consultant. The firm is expected to analyze cash flow and financial statement projections, including establishment of performance benchmarks, monitor performance versus projections and benchmarks, and monitoring of cash flow and solvency of the Debtor. The firm will bill the Debtor's estates based on the hourly rates of its professionals: Designations Hourly Rates ------------ ------------ Managing Director $285 Director $205 Senior Associate $165 The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Crystal Cathedral Crystal Cathedral Ministries is a Southern California-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. March J. Winthrop, Esq., at Winthrop Couchot Professional Corporation, in Newport Beach, California, represents the Debtor. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. The U.S. Trustee for Region 16 appointed seven members to the official committee of unsecured creditors in the Chapter 11 case of Crystal Cathedral Ministries. CYNTHIA TURNER: Court Pegs BofA Lien at $850,000 ------------------------------------------------ Bankruptcy Judge Thomas E. Carlson ruled that the value of the lien of Bank of America, National Association -- successor by merger to LaSalle Bank NA as trustee for WaMu Mortgage Pass- Through Certificates Series2006-AR11 Trust -- on Cynthia J. Turner's real property at 917 N. Idaho Street, San Mateo, California, is $850,000 as of March 29, 2011. A copy of the Court's April 5, 2011 Memorandum is available at http://is.gd/x80jjwfrom Leagle.com. Cynthia J. Turner, aka Cynthia Turner Hall, filed for Chapter 11 bankruptcy (Bankr. N.D. Calif. Case No. 10-33520) on Sept. 9, 2010. DANIEL COOK: Bankruptcy Court Rules on Pending Motions ------------------------------------------------------ Bankruptcy Judge James S. Starzynski issued a Memorandum Opinion in connection with various motions currently pending in the bankruptcy case of Daniel William Cook and Yolanda Teresa Cook. The Debtors filed for Chapter 11 bankruptcy (Bankr. D. N.M. Case No. 04-17704) on Oct. 21, 2004. On Dec. 7, 2004, the Debtors filed Adversary Proceeding 04-1240-S, Cook, et al. v. Garrett Capital, et al. Wells Fargo Bank, NA, one of the defendants, filed a Motion to Abstain. After briefings and hearings, the Bankruptcy Court entered Proposed Findings of Fact and Conclusions of Law on Oct. 19, 2005, recommending to the District Court that it enter an order granting abstention. The matter was then put on the District Court's docket as No. MC05-0042-JB. On March 19, 2009, the Hon. James Browning, District Judge, entered an Order granting the motion and ordering the Bankruptcy Court to abstain from exercising jurisdiction over the adversary proceeding. The March 19, 2009 Order disposed of the adversary proceeding, in effect dismissing it; no further action on the matter was required and, as with any dismissal, the District Court case should have been closed but was not. For unknown reasons, the March 19, 2009 District Court Order was not transmitted to the Bankruptcy Court until March 30, 2010. Perhaps as a consequence, between July 17, 2009 and October 29, 2009, before the Bankruptcy Court was notified of the District Court's Order, the parties filed more motions, responses, and replies in the still open District Court case. None of those filings had anything to do with the subject matter of the closed District Court case. Rather, they were motions dealing with procedural matters that should have been brought up in the underlying bankruptcy case still pending in the Bankruptcy Court, e.g., claims for stay violations and motions for sanctions. The parties also filed "notices" of the District Court filings in the Bankruptcy Court. No party brought to the attention of the Bankruptcy Court any of the District Court filings -- other than filing the "notices" -- and no party asked for a hearing in Bankruptcy Court on any of the issues presented. On Dec. 1, 2009, the District Court conducted a hearing on the motions. On Dec. 3, 2009, the District Court entered an Order stating that the automatic reference of bankruptcy cases to the bankruptcy court was still in effect with respect to the underlying bankruptcy case, and referred the motions back to the bankruptcy court. The Bankruptcy Court conducted a status conference on Jan. 19, 2010 and took all the remaining issues under advisement. A copy of the Bankruptcy Court's April 6, 2011 Memorandum Opinion is available at http://is.gd/7n3jolfrom Leagle.com. DEVELOPMENTAL DYNAMICS: Case Summary & Creditors Lists ------------------------------------------------------ Debtor: Developmental Dynamics Inc. 3731 Stocker Street, #105 Los Angeles, CA 90008 Bankruptcy Case No.: 11-25855 Chapter 11 Petition Date: April 12, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Sheri Bluebond Debtor's Counsel: Michael Y. Lo, Esq. LAW OFFICE OF MICHAEL Y. LO 506 N. Garfield Avenue, #280 Alhambra, CA 91801 Tel: (626) 289-8838 E-mail: michaellolaw@yahoo.com Scheduled Assets: $50,400 Scheduled Debts: $2,457,290 Affiliate that simultaneously sought chapter 11 protection: Debtor Case No. ------ -------- Developmental Dynamics Family Services Inc. 11-25864 Scheduled Assets: $50,400 Scheduled Debts: $1,599,103 A list of Developmental Dynamics Inc.'s 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb11-25855.pdf A list of Developmental Dynamics Family's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/cacb11-25864.pdf The petitions were signed by Wendy Carroll, president. DONALD PEDERSEN: Bankr. Court Avoids Doucette Lien on House ----------------------------------------------------------- Hearing was held on March 14, 2011, on the objection to exemptions by William and Mary Doucette, Donald and Marcee Pedersen's resistance, the Pedersens' motion to avoid lien, and objection by the Doucettes. In an April 11, 2011 Order, Bankruptcy Judge Timothy J. Mahoney held that the objection to exemptions is overruled. The motion to avoid lien is granted to the extent it impairs the homestead exemption. However, the lien will remain in place until such time as the Debtors complete plan payments and are entitled to a discharge. The Doucettes obtained a $96,971 pre-petition judgment against the debtor Donald Pedersen, which became a judicial lien on the Pedersens' house, behind two consensual liens. When they filed for bankruptcy relief, the Debtors claimed a $60,000 homestead exemption in the property. The Doucettes filed a proof of claim for $57,743. They assert that the exemption will impair their lien rights, while the Debtors assert that the lien impairs their exemption rights. Donald H. Pedersen and Marcee N. Pedersen filed for Chapter 11 bankruptcy (Bankr. D. Neb. Case No. 10-83133) on Oct. 28, 2010. A copy of the Court's ruling is available at http://is.gd/BGxGLH from Leagle.com. DRYSHIPS INC: Ocean Rig Prices Sr. Unsecured Bonds Offering ----------------------------------------------------------- DryShips Inc. announced on April 13, 2011, the pricing of $500 million aggregate principal amount of 9.5% Senior Unsecured Bonds Due 2016 offered by its majority-owned subsidiary Ocean Rig UDW Inc. in a private placement. The offering has been made to Norwegian professional investors and eligible counterparties as defined in the Norwegian Securities Trading Regulation 10-2 to 10-4, to non-United States persons in offshore transactions in reliance on Regulation S under the Securities Act of 1933, as amended and in a concurrent private placement in the United States only to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The proceeds of the offering are expected to be used to finance Ocean Rig's newbuilding drillships program and general corporate purposes. The offering is scheduled to close on April 27, 2011, subject to customary closing conditions. The Bonds have not been registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States or to or for the benefit of U.S. persons unless so registered except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable securities laws in other jurisdictions. About DryShips Inc. Based in Greece, DryShips Inc. -- http://www.dryships.com/-- -- owns and operates drybulk carriers and offshore oil deep water drilling units that operate worldwide. As of September 10, 2010, DryShips owns a fleet of 40 drybulk carriers (including newbuildings), comprising 7 Capesize, 31 Panamax and 2 Supramax, with a combined deadweight tonnage of over 3.6 million tons and 6 offshore oil deep water drilling units, comprising of 2 ultra deep water semisubmersible drilling rigs and 4 ultra deep water newbuilding drillships. DryShips's common stock is listed on the NASDAQ Global Select Market where it trades under the symbol "DRYS". The Company's balance sheet at Sept. 30, 2010, showed US$5.80 million in total assets, US$1.90 million in total current liabilities, US$1.10 million in total noncurrent liabilities, and stockholders' equity of US$2.80 million. On Nov. 25, 2010, DryShips Inc. entered into a waiver letter for its US$230.0 million credit facility dated September 10, 2007, as amended, extending the waiver of certain covenants through Dec. 31, 2010. As reported in the Troubled Company Reporter on Sept. 29, 2010, the Company said it is currently in negotiations with its lenders to obtain waivers, waiver extensions or to restructure its debt. As of June 30, 2010, the Company's theoretical exposure (current portion of long-term debt less cash and cash equivalents less restricted cash) amounted to US$761.4 million. DYNEGY INC: Hires White & Case and Lazard for Restructuring Advice ------------------------------------------------------------------ Dynegy Inc. said the law firm of White & Case LLP and the financial advisory firm of Lazard Freres & Co. LLC have been retained to advise the company and the Finance and Restructuring Committee of Dynegy's Board of Directors on debt restructuring activities. The Finance and Restructuring Committee is chaired by Vincent J. Intrieri. Other directors on the committee are Thomas W. Elward, E. Hunter Harrison and Samuel Merksamer. The purpose of the committee is to undertake a comprehensive review of Dynegy's various restructuring alternatives, including, without limitation, if appropriate, reviewing and evaluating (i) possible changes to the capital structure of Dynegy, including the issuance, repurchase or prepayment of indebtedness or equity securities and (ii) possible sales of Dynegy's assets. Creditors Tap Houlihan Lokey Mike Spector, writing for The Wall Street Journal, reports that investment bank Houlihan Lokey is advising Dynegy creditors. Mr. Spector further relates that Dynegy doesn't intend to file for bankruptcy protection in the near term. People familiar with the matter said, it plans to hold talks with bondholders on ways to reduce its debt obligations. Dynegy carried about $4.8 billion in debt at year-end, with the lion's share concentrated in a variety of bonds. Sources told the Journal Dynegy is optimistic it can replace or amend the senior debt amid ebullient credit markets. The Journal notes Dynegy's bonds are trading at a 20%-30% discount, giving the company an opportunity to talk to bondholders about eliminating a portion of their debt holdings. White & Case and Lazard plan to study Dynegy's finances for about two weeks and then discuss options with the company, said another person familiar with the matter, the Journal relates. According to the Journal, people familiar with the matter said Dynegy director Vincent Intrieri, an Icahn confidant, chairs the board's special finance and restructuring committee and started interviewing advisers in recent weeks. Mr. Icahn is Dynegy's largest shareholder, with rights to more than 14%, and wants to keep the company out of bankruptcy court, where stock is usually wiped out. The sources told the Journal Mr. Intrieri and others met with White & Case and Lazard Tuesday to begin discussing how to rearrange the company's finances. 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. Failed Sale The Troubled Company Reporter has chronicled Dynegy's attempts to sell itself. In August 2010, Dynegy struck a deal to be acquired by an affiliate of The Blackstone Group at $4.50 a share or roughly $4.7 billion. That offer was raised to $5.00 a share in November. Through Carl Icahn and investment fund Seneca's efforts, shareholders thumbed down both offers. In December 2010, an affiliate of Icahn 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 February 2011, Icahn Enterprises L.P. terminated the proposed merger agreement with the Company after it failed to garner the required number of shareholder votes. Goldman, Sachs & Co. and Greenhill & Co., LLC, served as financial advisors and Sullivan & Cromwell LLP served as legal counsel to Dynegy on the sale efforts. Bankruptcy Warning Dynegy warned shareholders in March it might be forced into bankruptcy if it is unable to renegotiate the terms of its existing debt. The Company's balance sheet at Dec. 31, 2010, showed $10.013 billion in total assets, $7.267 billion in total liabilities, and stockholders' equity of $2.746 billion. Ernst & Young LLP, in Houston, said that Dynegy projects that it is likely that it will not be able to comply with certain debt covenants throughout 2011. "This condition and its impact on Dynegy Inc.'s liquidity raises substantial doubt about Dynegy Inc.'s ability to continue as a going concern." * * * As reported by the Troubled Company Reporter on March 14, 2011, Fitch Ratings downgraded the ratings on Dynegy and its subsidiaries after Dynegy's auditors raised substantial doubt as to its ability to continue as a going concern and the company announced it would likely trip debt covenants in its credit facilities. EAST COAST: In Ch. 11 to Restructure Georgia Capital Debt --------------------------------------------------------- Wayne Faulkner at StarNews Online reports that Wilmington, North Carolina-based East Coast Development II LLC is aiming to restructure its debt via the Chapter 11 process. East Coast Development disclosed liabilities of about $12.17 million and assets of about $24.8 million as of the Chapter 11 filing. According to the report, James McFarland Jr. is the sole member of the Company, which holds millions worth of land downtown, including the site of the Rhino Club, and elsewhere in New Hanover and Pender counties, according to the filing. The LLC also has interests in Raleigh, Greensboro, Charleston and Columbia. Creditor Georgia Capital LLC attempted to foreclose on East Coast, said attorney Amy Currin of Stubbs & Perdue in New Bern, which is representing East Coast. East Coast "was unable to get its loan reinstated," StarNews Online quotes Ms. Currin, as saying. She noted that Mr. McFarland "has plenty of equity and rental income. It should be a fairly clean Chapter 11 reorganization." Ms. Currin said that the Georgia Capital loan "had a very high rate of interest and difficult terms. East Coast owes the Atlanta company $1.487 million. Georgia Capital has claims against these properties: Parking lots at 127 Market St. and 20 N. Front St., a commercial development site in Castle Hayne and duplexes and acreage in Jacksonville. New Hanover District Attorney Ben David filed a nuisance abatement suit late to prevent the dissolved nightclub's owners from opening a similar establishment in the state. The controversy stems from a brawl outside the club in January that ended in a fatal stabbing. Ms. Currin said she expected Mr. McFarland would be able to pay creditors from his rental income. East Coast Development II LLC dba 100 Block of Market Street LLC filed for Chapter 11 bankruptcy protection on April 8, 2011 (Bankr. E.D. N.C. Case No. 11-02792). Judge Randy D. Doub presides over the case. Trawick H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., represents the Debtor. In its schedules, the Debtor disclosed $24,792,275 in assets, and $12,172,815 in debts. EMISPHERE TECHNOLOGIES: Amends Form S-1 for $8.14 Million Shares ---------------------------------------------------------------- Emisphere Technologies, Inc., filed with the U.S. Securities and Exchange Commission a Post-Effective Amendment No. 1 to Form S-1 registration statement relating to the offer for sale by the existing holders of the Company's common stock of 8,140,496 shares of the Company's common stock, par value $0.01 per share, including 3,488,784 shares of the Company's common stock issuable upon exercise of the warrants held by the selling security holders. All of the shares of common stock offered by this prospectus are being sold by the selling security holders. It is anticipated that the selling security holders will sell these shares of common stock from time to time in one or more transactions, in negotiated transactions or otherwise, at prevailing market prices or at prices otherwise negotiated. The Company will not receive any proceeds from the sales of shares of common stock by the selling security holders. The Company has agreed to pay all fees and expenses incurred by us incident to the registration of the Company's common stock, including SEC filing fees. Each selling security holder will be responsible for all costs and expenses in connection with the sale of their shares of common stock, including brokerage commissions or dealer discounts. The Company's common stock is currently traded on the Over-The- Counter Bulletin Board, commonly known as the OTC Bulletin Board, under the symbol "EMIS." As of March 31, 2011, the closing sale price of the Company's common stock was $1.37 per share. A full-text copy of the Amended Prospectus is available for free at http://is.gd/gxv0RS About Emisphere Technologies Based in Cedar Knolls, New Jersey, Emisphere Technologies, Inc. (OTC BB: EMIS) -- http://www.emisphere.com/-- is a biopharmaceutical company that focuses on a unique and improved delivery of pharmaceutical compounds and nutritional supplements using its Eligen(R) Technology. The Eligen(R) Technology can be applied to the oral route of administration as well other delivery pathways, such as buccal, rectal, inhalation, intra-vaginal or transdermal. Since its inception in 1986, Emisphere has generated significant losses from operations. Emisphere anticipates it will continue to generate significant losses from operations for the foreseeable future, and that its business will require substantial additional investment that it has not yet secured. The Company reported a net loss of $56.91 million on $100,000 of revenue for the year ended Dec. 31, 2010, compared with a net loss of $16.82 million on $92,000 of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $7.27 million in total assets, $89.79 million in total liabilities and $82.52 million in total stockholders' deficit. Following the 2010 financial results, PricewaterhouseCoopers LLP, in New York, noted that the Company has experienced recurring operating losses, has limited capital resources and has significant future commitments that raise substantial doubt about its ability to continue as a going concern. EMIVEST AEROSPACE: Auctions Two Ground Leased Airport Properties ---------------------------------------------------------------- Hilco Real Estate and Counsel RB announced on April 13, 2011, that they will conduct a sealed bid auction for two ground leased airport properties, formerly operated by business jet manufacturer, Emivest Aerospace Corp., which filed for Chapter 11 bankruptcy protection in October 2010. A bid deadline of June 16, 2011 has been set for both properties. Prospective buyers may submit bids on or both of the assets. "The location, remaining lease term, and extension options on these assets makes them desirable for any company operating in the aerospace and/or defense field," said Roberto Perez, Senior Vice President of Hilco Real Estate. He added, "These are best of breed hangar, manufacturing warehouse, and office properties. Each property can provide a company with a turn-key solution for its space and operational requirements." Geoffrey S. Schnipper, Sr. Project Manager for Hilco Real Estate, added, "This is a rare opportunity to assume the remaining term and options of the ground leases. The annual rent obligation associated with these leases is well below market and cannot be replicated in today's marketplace. Only in a bankruptcy setting are these leases transferrable." The offering consists of these assets: -- Martinsburg, WV -- Current lease runs through 2030 with two 30-year renewals at a rate of $10,000 per year plus $1 per usable acre. T he property is 87,500 total SF, inclusive of 25,000 SF of finished office space and is expandable to 33 acres. The remaining 67,500 SF is manufacturing/hangar space. The building was constructed in 1998 and is equipped with cranes, 3,000 amp electrical service, and 40'-45' ceiling clear height. -- San Antonio, TX -- Current lease runs through 2016 with a first right of refusal on 10 year extension. The annual lease rate for the 127,407 SF is $100,000 per year. The property served as the company's corporate headquarters and final assembly plant for the Emivest SJ30 business jet. Originally constructed to serve as an MRO facility for Boeing 707 aircraft, the property can be used for many aerospace/defense applications. The building features heavy power, executive office space, expansion capability, and 46'-54' ceiling clear height. Property brochures and comprehensive due diligence information for both properties can be found online at www.hilcorealestate.com/airport or by calling call 847-313-4790. About Emivest Aerospace Emivest Aerospace Corporation -- http://www.sj30jet.com/-- is a U.S.-based aircraft manufacturing company and a subsidiary of Emirates Investment & Development PSC. Emivest Aerospace Corporation produces the SJ30 light jet. Emivest Aerospace Corporation filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-13391) on Oct. 20, 2010. Emivest estimated assets and debts between $50 million and $100 million. Daniel B. Butz, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Delaware, serves as counsel to the Debtor. Morgan Joseph & Co. Inc. is the financial advisor to the Debtor. The Debtor also hired DLA Piper LLP (US) as special counsel to assist in the marketing of its assets. Attorneys at Pachulski Stang Ziehl & Jones LLP serve as counsel to the Official Committee of Unsecured Creditors. Deloitte Financial Services LLP is the Committee's financial advisor. ENRON CORP: Jeff Skilling Loses Appeal to Overturn Convictions -------------------------------------------------------------- Jeffrey Skilling, Enron Corp.'s former chief executive officer, failed in his attempts to overturn his convictions after the U.S. Appeals Court in New Orleans affirmed all counts, Edvard Petterson at Bloomberg News reported. A three-panel judge in the New Orleans Appellate Court, on April 6, found that the jury hearing Mr. Skilling's case was presented with "overwhelming" evidence that he conspired to commit securities fraud, Bloomberg related. The panel, according to Bloomberg, notes that the trial judge harmlessly erred in allowing the jury to convict Mr. Skilling for conspiracy on a so- called "honest-services fraud theory" as well as on a securities- fraud theory. The panel, however, said the verdict would have been the same absent the alternative-theory error, Bloomberg said. Mr. Skilling was convicted by a jury trial in 2006 for making false statements and insider trading. Bloomberg noted that after Mr. Skilling's trial, the appeals court declared the honest-services fraud theory legally invalid in an appeal by four Merrill Lynch & Co. bankers, who were convicted in a related Enron case. The appellate court, Bloomberg continued, said the bankers didn't deprive Enron of their honest services because they had acted in Enron's best interest and didn't personally profit. Daniel Petrocelli, Esq., Mr. Skilling's lawyer, disagrees with the Appeals Court's decision and says that he and his fellow lawyers will continue to fight to overturn their client's convictions. Mr. Skilling was also previously denied a temporary release to attend his son's funeral, the Associated Press said. Mr. Skilling's son, John Taylor Skilling, was found dead at home in Santa Ana. The cause of death was unknown, according to the report. In a decision dated June 24, 2010, U.S. Supreme Court Justice Ruth Bader Ginsburg, in a landmark 9-0 decision, said the U.S. Government went too far in stretching an anti-fraud law in prosecuting Mr. Skilling and others. Justice Ginsburg vacated in part Mr. Skilling's conviction in failing to provide "honest services" to shareholders. According to the high court, Section 1346 of the U.S. Crimes and Criminal Procedure, which proscribes fraudulent deprivations of "the intangible right of honest services," is properly confined to cover only bribery and kickback schemes. Because Mr. Skilling's alleged misconduct entailed no bribe or kickback, it does not fall within the Court's confinement of Section 1346's proscription, Justice Ginsburg said. The case is U.S. vs. Skilling, 06-20885, U.S. District Court, U.S. Court of Appeals for the Fifth Circuit (New Orleans). About Enron Corp. Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 01-16033) on Dec. 2, 2001, following controversy over accounting procedures that caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors won confirmation of their Plan in July 2004, and the Plan was declared effective on Nov. 17, 2004. After approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre- bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. ENRON CORP: Former Exec. Shelby Sentenced for Insider Trading ------------------------------------------------------------- Rex Shelby, a former Enron Broadband Services senior vice president of engineering and operations, was sentenced by a federal judge in Houston, Texas, on an insider trading charge linked to the investment fraud that destroyed the world's largest energy trader 10 years ago, Laurel Brubaker Calkins at Bloomberg News reported. According to the report, Mr. Shelby pleaded guilty to one count of insider trading and was sentenced to three months of community confinement followed by home confinement for three months. He will also forfeit about $2.6 million in profits from the illicit trade, the report said. Mr. Shelby's lawyer, Ed Tomko, told a judge that Mr. Shelby has also agreed to forfeit another $1 million to resolve related charges by the U.S. Securities and Exchange Commission charges, Bloomberg said. He faced a maximum of 10 years and a fine of $1 million on the one count before reaching his plea deal, the report related. "I take full responsibility for my actions and all the decisions I made at Enron... no one forced me to do those things," the news agency quoted Mr. Shelby as saying. Mr. Shelby and six other EBS executives were indicted in 2003 on charges they helped the parent company's senior management, including Enron Corp.'s former chairman Kenneth Lay and chief executive Jeffrey Skilling, deceive analysts and investors about the unit's capabilities and financial performance, Bloomberg related. Mr. Shelby, according to Bloomberg, has long maintained he sold the Enron shares to diversify his portfolio and not based on any insider knowledge of an alleged conspiracy to inflate Enron's stock price. To avoid a trial on broader conspiracy and fraud charges, which had been set to begin past January, Mr. Shelby pleaded guilty to one count of insider trading in November, the report continued. The case is U.S. vs. Shelby, H-03-093, U.S. District Court, Southern District of Texas (Houston). About Enron Corp. Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 01-16033) on Dec. 2, 2001, following controversy over accounting procedures that caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors won confirmation of their Plan in July 2004, and the Plan was declared effective on Nov. 17, 2004. After approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre- bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. ENRON CORP: IRS Pays $1.1-Mil. Reward to Whistleblower ------------------------------------------------------ The U.S. Internal Revenue Service has reportedly paid a whistleblower approximately $1,100,000 as a reward for giving a tip that Enron Corp. was using abusive tax shelters to generate fictitious income, The Washington Post reported on March 15, 2011. The tax fraud reportedly allowed Enron to evade taxes and report an added $300,000,000 of imaginary profit to a $600,000,000 income, the report said. "If the IRS had pursued this information in 1999 when my client first informed them of these abusive tax shelters, the government might have realized the depth of Enron's problems and perhaps taken steps that might have helped avoid a total meltdown," the Washington Post quoted Erika A. Kelton, Esq., at Phillips & Cohen, in Washington, D.C. About Enron Corp. Based in Houston, Texas, Enron Corporation filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 01-16033) on Dec. 2, 2001, following controversy over accounting procedures that caused Enron's stock price and credit rating to drop sharply. Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal & Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its bankruptcy case. The Official Committee of Unsecured Creditors in the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP. The Debtors won confirmation of their Plan in July 2004, and the Plan was declared effective on Nov. 17, 2004. After approval of the Plan, the new board of directors decided to change the name of Enron Corp. to Enron Creditors Recovery Corp. to reflect the current corporate purpose. ECRC's sole mission is to reorganize and liquidate certain of the operations and assets of the "pre- bankruptcy" Enron for the benefit of creditors. ECRC has been involved in the MegaClaims Litigation, an action against 11 major banks and financial institutions that ECRC believes contributed to Enron's collapse; the Commercial Paper Litigation, an action involving the recovery of payments made to commercial paper dealers; and the Equity Transactions Litigation, which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG, Credit Suisse and Bear Stearns to recover payments made to the four banks on transactions involving Enron's stock while the company was insolvent. FARMLAND INDUSTRIES: 8th Cir. Affirms Dismissal of GAF Suit ----------------------------------------------------------- The Court of Appeals for the Eighth Circuit upheld the decision of the United States Bankruptcy Appellate Panel for the Eighth Circuit affirming the bankruptcy court's order dismissing GAF Holdings, LLC's complaint against Philip Rinaldi; Stanley Riemann; Robert Terry; Pegasus Partners II, L.P.; Pegasus Investors II, L.P.; Pegasus Capital Partners, L.P.; and J.P. Morgan Trust Company, National Association in its capacity as Trustee of the FI Liquidating Trust. The Eighth Circuit held that GAF lacks standing to make an appeal. GAF was incorporated in 1999 to purchase a refinery from Farmland Industries, Inc. GAF could not obtain financing, and later Farmland filed Chapter 11 bankruptcy. Farmland submitted sale procedures for its Coffeyville assets, including its refineries and a coke-gasification fertilizer complex, to the bankruptcy court, and the court entered an order approving them. GAF did not object to the sale procedures. GAF submitted a bid to Farmland for the Coffeyville assets, but Farmland rejected the bid. It determined that GAF was not a qualified bidder because the bid was submitted without the required 10% deposit of the bid amount, in an improper format, without required exhibits and schedules, and missing information necessary for Farmland to determine the bid's actual value. GAF did not contest the determination. On Nov. 14, 2003, the bankruptcy court approved the sale of the Coffeyville assets to Coffeyville Resources, LLC, which was incorporated by Pegasus to make the purchase. In the sale order, the court found that the only qualifying bid was made by CRLLC, that the sale procedures were conducted in good faith, and that the purchase price under the sale agreement was fair, reasonable, and for sufficient value. GAF did not object to or appeal the sale order. Instead, on Feb. 2, 2004, GAF moved under Federal Rule of Civil Procedure 60(b) to set aside the sale order, contending that the sale was the product of collusion between Riemann, Terry, and CRLLC. Specifically, GAF asserted that Riemann, a former Farmland executive, had a conflict of interest at the time of the sale because he was discussing possible employment with CRLLC, that Riemann was now employed by CRLLC, and that GAF did not have the opportunity to conduct due diligence prior to submitting its bid on the Coffeyville assets. The bankruptcy court heard arguments on GAF's 60(b) motion and then denied it, concluding that the sale was conducted at arm's length and that there was insufficient evidence to support GAF's allegations. GAF did not appeal the denial of its 60(b) motion. On Feb. 20, 2004, the bankruptcy court entered an order that authorized an amendment to the sale agreement. The order also reaffirmed the terms of the sale order unaffected by the amendment, including the determination that the sale of the Coffeyville assets had been conducted in good faith. GAF did not challenge the order. On Feb. 27, 2007, GAF filed a complaint in bankruptcy court alleging that the appellees intentionally interfered with GAF's business expectancy in purchasing the Coffeyville assets and participated in a civil conspiracy to conceal the real value of the Coffeyville assets. The appellees moved to dismiss the complaint on various grounds. The bankruptcy court dismissed the complaint with prejudice, holding that GAF was attempting to make an impermissible collateral attack on its prior orders approving the sale and that GAF failed to state a claim for which relief could be granted. Alternatively, the court held that GAF lacked standing. On appeal, the BAP held that the bankruptcy court lacked subject- matter jurisdiction over GAF's state tort claims against non- debtor third parties. In re Farmland Indus., Inc., 378 B.R. 829 (B.A.P. 8th Cir. 2007). The BAP remanded the case to the bankruptcy court, instructing the court to dismiss GAF's complaint for lack of subject-matter jurisdiction. The defendants appealed the BAP's decision, and the Eighth Circuit reversed. In re Farmland Indus., Inc., 567 F.3d 1010 (8th Cir. 2009). The Eighth Circuit held that the bankruptcy court had subject-matter jurisdiction because GAF's claims are "related to" the bankruptcy of Farmland under 28 U.S.C. Sec. 157(c)(1). Eighth Circuit remanded the case to the BAP for a ruling on whether the bankruptcy court properly dismissed GAF's complaint. On remand, the BAP affirmed the bankruptcy court's dismissal of GAF's complaint. In re Farmland Indus., Inc., 408 B.R. 497 (B.A.P. 8th Cir. 2009) (holding that GAF lacked standing to sue and that GAF's complaint failed to state a claim, was barred by collateral estoppel, and was precluded by 11 U.S.C. Sec. 363(m)). The case is GAF Holdings, LLC, Appellant, v. Philip Rinaldi; Stanley Riemann, Appellees, Black Diamond Capital Management, LLC, Robert Terry; Pegasus Capital Partners, L.P.; Pegasus Investors II, L.P.; Pegasus Capital Partners, L.P.; J.P. Morgan Trust Company, National Association, in its capacity as Trustee of the FI Liquidating Trust, Appellees, No. 09-3049 (8th Cir.). A copy of the Eighth Circuit's April 4, 2011 decision is available at http://is.gd/8hMC2qfrom Leagle.com. The Eighth Circuit panel consists of Circuit Judges Roger Leland Wollman, Kermit Edward Bye, and Bobby E. Shepherd. Circuit Judge Shepherd wrote the decision. About Farmland Industries Farmland Industries, Inc., was one of the largest agricultural cooperatives in North America with about 600,000 members. The firm operates in three principal business segments: fertilizer production; pork processing, packing and marketing; and beef processing, packing and marketing. The company, along with its affiliates, filed for chapter 11 protection (Bankr. W.D. Mo. Case No. 02-50557) on May 31, 2002 before the Honorable Jerry W. Venters. The Debtors' Counsel is Laurence M. Frazen, Esq., at Bryan Cave LLP. When the Debtors filed for chapter 11 protection, they listed total assets of $2.7 billion and total debts of $1.9 billion. During its Chapter 11 case, the Company sold its businesses, including its pork production and processing business to Virginia-based Smithfield Foods $367.4 million in cash and other consideration. The Bankruptcy Court confirmed the Second Amended Joint Plan of Reorganization filed by Farmland Industries, Inc., and its debtor-affiliates, and that plan was effective on May 1, 2004. Pursuant to the plan, Farmland transferred certain assets to a liquidating trust to liquidate and distribute proceeds to certain creditors of and interest holders in Farmland. J.P. Morgan Trust Company, National Association, serves as the Liquidating Trustee. FLYING MARLIN: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: The Flying Marlin Charleston, LLC 1078 Blue Hill Creek Marco Island, FL 34145 Bankruptcy Case No.: 11-06748 Chapter 11 Petition Date: April 10, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Ft. Myers) Debtor's Counsel: Christian B. Felden, Esq. FELDEN AND FELDEN, P.A. 201 Shannon Oaks Circle, Suite 200 Cary, NC 27511 Tel: (888) 808-9291 Fax: (888) 808-9991 E-mail: cbfelden@feldenandfelden.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/flmb11-06748.pdf The petition was signed by Peter McFarland, managing member. FORUM HEALTH: Committee Fights Foundations' Chapter 11 Exit ----------------------------------------------------------- Business Journal Daily reports that the committee of unsecured creditors in Forum Health Inc.'s Chapter 11 bankruptcy will be in court to try to prevent the dismissal of two related foundations' bankruptcy cases and continue their efforts to tap into more than $12 million of the foundations' unrestricted assets. According to the report, U.S. Bankruptcy Judge Kay Woods will hear a motion by the creditors' committee to stay her order, issued last month, that permits Trumbull Memorial Hospital Foundation and Western Reserve Health Foundation to dismiss their Chapter 11 cases. Judge Woods ruled that the two foundations were "separate and distinct nonprofit corporations" that have "operated exclusively for their charitable purposes," and that their unrestricted funds could not be used to pay the creditors of the other various Forum debtors in the consolidated Chapter 11 case. Forum filed for bankruptcy more than two years ago. Its key assets were purchased last fall by Community Health Systems inc. of Nashville and now operate as ValleyCare Health System, Source says. The report relates that the Creditors Committee, which represents Forum's vendors and suppliers, filed an appeal of the judge's ruling with the District Court for the Northern District of Ohio, arguing that the dismissal motions were "incorrectly decided" and that it is likely to succeed on appeal. In their objection, the two foundations argue that the bankruptcy court did not abuse its discretion in granting the dismissal motions and that nothing the committee has submitted is likely to convince an appeals court to determine otherwise. They further argue that staying the dismissals will harm the foundations, their charitable missions, their creditors and all parties by freezing the foundation's assets, notes the Journal. The Ohio Attorney General's office also submitted a filing arguing that "no public interest" is served by granting a stay pending the creditors' appeal. About Forum Health Forum Health and its affiliates filed for Chapter 11 protection (Bankr. N.D. Ohio Lead Case No. 09-40795) on March 16, 2009. In its petition, Forum Health estimated $100 million to $500 million in assets and debts. McDonald Hopkins LLC and Nadler, Nadler and Burdman Co., L.P.A., serve as the Debtors' chapter 11 co-counsel. Huron Consulting Services LLC is the Debtors' Chief Restructuring Officer and Financial Support Personnel. Houlihan Lokey Howard and Zukin Capital, Inc. are the Debtors' investment bankers. Ernst & Young LLP is the Debtors' independent auditor. Baker and Hostetler and Thompson Hine LLP serve as special counsel. Squire, Sanders & Dempsey LLP serve as the bond counsel. Kurtzman Carson Consultants LLC is the claims and notice agent. Alston & Bird LLP serves as counsel to the Official Committee of Unsecured Creditors. Grant Thornton LLP is the financial advisor to the Creditors Committee. FR & S CORP: Court Rules on Puerto Rico Treasury's Tax Claims ------------------------------------------------------------- The Treasury Department of the Commonwealth of Puerto Rico requests in the chapter 7 bankruptcy case of FR & S Corp., allowance and payment of alleged post-petition administrative expenses for corporate income taxes for the tax year 2008, taxes withheld from salaries for the period ending on Dec. 31, 2008, and the 7% withholding of taxes for the payment of professional services for tax year 2008, pursuant to 11 U.S.C. Sections 503(b)(1)(B)(i), 507(a)(2) and 507(a)(8)(A) and (D). The chapter 7 trustee objects to the PR Treasury's request for the 2008 corporate income taxes, employment taxes and the 7% tax withholding from the payment of professional services for tax year 2008 to be afforded administrative expense priority based on the following: (i) Debtor filed its bankruptcy petition December 19, 2008, and was converted to chapter 7 on May 15, 2009, thus the amount requested is an unsecured priority; (ii) The 2008 corporate income taxes, employment taxes and the 7% withholding of taxes for the payment of professional services are pre-petition taxes even though the tax payment was due post-petition. Thus, the PR Treasury is not entitled to administrative expense priority; and (iii) There was no tax incurred by the estate because Debtor's taxable activity occurred pre-petition, before there was an estate. Bankruptcy Judge Enrique S. Lamoutte granted the PR Treasury's request is granted in part and denied in part. The Court found and concluded that: (1) PR Treasury's claim for state income taxes for the entire 2008 calendar year is an administrative expense which satisfies the two prong test of Section 503(b)(1)(B)(i); (2) the state income tax withholdings for the first three quarters of the 2008 year were incurred pre-petition and as such are entitled to eighth priority status in conformity with Section 507(a)(8)(C); (3) the fourth quarter of Debtor's 2008 calendar year is a post- petition tax claim and as such the same is afforded administrative expense priority status since the same does not fall under Section 507(a)(8) and was incurred by the estate on Dec. 31, 2008; (4) the 7% tax withholdings for the first eleven (11) months of Debtor's 2008 calendar year were incurred pre-petition and as such must be afforded eighth priority status pursuant to Section 507(a)(8)(C); and (5) the 7% tax withholding for professional services rendered for the entire month of December 2008 was incurred post-petition and as such satisfies the two prong test of Section 503(b)(1)(B)(i). A copy of the Court's March 30, 2011 Opinion and Order is available at http://is.gd/bJVffHfrom Leagle.com. FR & S Corp. filed a Chapter 11 bankruptcy petition (Bankr. D. P.R. Case No. 08-08659) on Dec. 19, 2008, represented by Juan Manuel Suarez Cobo, Esq. -- suarezcobo@prtc.net -- in San Juan, Puerto Rico. The petition listed under $50,000 in assets and between $1 million and $10 million in debts. The Court on May 15, 2009, granted the Debtor's request for conversion to chapter 7. FRENCH BROAD: Faces Objections at April 20 Plan Hearing ------------------------------------------------------ Linda W. Simpson, bankruptcy administrator for the Western District of North Carolina, objects to confirmation of the proposed Chapter 11 plan of French Broad LLC, arguing that the plan is not feasible because, among other things, the Debtor's monthly status report does not show sufficient monthly income to fund the plan. Garry and Paula Paddick, Mountain 1st Bank & Trust, and Smoky Mountain Materials Inc. also object to the Debtor's plan. The Hon. George R. Hodges of the U.S. Bankruptcy Court for the Western District of North Carolina will convene a hearing on April 20, 2011, at 9:30 a.m. to consider confirmation of the Debtor's proposed Chapter 11 plan. The Debtor won approval of the disclosure statement explaining the Plan on Feb. 23, 2011. Ballots were sent to creditors and were due to be returned March 18. The Chapter 11 Plan According to the Disclosure Statement, the Plan provides for creditors to be paid in full from the sale of units by French Broad Place. Under the Plan, Metromont Corporation, owed $2,961,431 for its DIP claim, will receive 10% per annum accrued interest for a period of 13 months, principal reduction will be paid periodically as future inventory sales close on account of Metromont's secured claim. Metromont will receive 40% of all future net sales proceeds to be applied to the principal loan balance outstanding. Ashville Savings Bank, owed $8,620,619, secured by a second lien deed of trust on the assets of the Debtor, will receive 40% of all future sales net proceeds applied to the principal loan balance outstanding on account of Ashville's impaired secured claim. Once the DIP loan is repaid 100%, then 100% of the future NSP will be paid to Ashville as loan principal reduction until paid in full with interest at the contract rate. Metromont, owed $2,765,234 secured by a third lien deed of trust, will not be paid interest or principal during the DIP loan tenure. The second deed of trust contract note will accrue interest at 5% from the date of the Plan. Once the DIP loan is repaid 10% and Ashville Savings Bank is repaid 100%, then Metromont will receive monthly interest at 5% and 100% of future NSP until repaid 100%. Ed Burdette Construction, holder a materialman's/mechanics lien in the amount of $2,627,773, will have its claim paid as a general unsecured claim. General unsecured creditors, expected to total $3,300,000, which includes the secured claim of Ed Burdette, will be paid in full over a period of three years. A copy of the Court-approved disclosure statement is available for free at http://bankrupt.com/misc/French_Broad_Final_DS.pdf Confirmation Required by April 30 The terms of the DIP loan provided that French Broad Realty, Inc., which is a separate organization from the Debtor, but is owned by principals of the Debtor, is allowed a limited six-month of sales listing for all units with a 1.5% listing-side commission and an additional 3% commission to be paid to the procuring broker if other than FBRI. FBRI will be allowed to draw up to $11,500 per month for use as salary of its personnel, for a period of six months. The Debtor, under the DIP loan, is required to obtain confirmation of the Plan by April 30. About French Broad French Broad Place LLC was formed for the development of a 48-unit mixed used real estate community in downtown Brevard, North Carolina. The owners -- led by Scott Latell and Joshua Burdette as managing members -- have over $4,500,000 of cash equity in the development to date. Appraisals conducted in the spring of 2010 valued the property from $10,500,000 to $12,5000,000. Secured claims by lenders exceed $14,000,000. French Broad Place LLC filed for Chapter 11 bankruptcy protection on March 25, 2010 (Bankr. W.D. N.C. Case No. 10-10335). Edward C. Hay, Jr., Esq., at Pitts, Hay & Hugenschmidt, P.A., represents the Debtor. The Company disclosed $20,171,100 in assets and $14,395,245 in liabilities. GEOSPATIAL HOLDINGS: Inks Settlement Deal with 29 Investors ----------------------------------------------------------- Geospatial Holdings, Inc., has entered into a settlement agreement with 29 investors that purchased shares of the Company's capital stock in private placements in October and December 2009 and March 2010. The investors had threatened to file a lawsuit against Geospatial and its officers relating to their purchases of $5.5 million of capital stock issued in connection with the offerings. The Company's Board of Directors unanimously approved the settlement agreement. While disputing all claims of misconduct by the Company's officers, the Board concluded that Geospatial would be unable to raise essential equity capital if the Company did not enter into the settlement agreement. Further, the Board concluded that without new equity capital the Company would be unable to continue its business as a going concern resulting in a complete loss of investment value for all of the Company's shareholders. The investors have agreed not to pursue their claims for a period of 120 days during which the Company plans to raise additional equity capital. Provided the Company raises at least $5 million in new equity capital before the expiration of 120 days, the investors have agreed to forever waive their right to pursue their claims against the Company and it officers, except in the event the Company files for bankruptcy. Following the closing of an equity offering of at least $5 million, the Company has agreed that the investors will be granted additional shares of Geospatial stock. Each such investor will be granted additional shares so that the aggregate number of shares issued to such investor related to the offerings and the settlement will equal the investor's aggregate investment in the offerings divided by the per share price at which the Company effects its anticipated offering. Thus, the investors will be treated as if they had purchased all of their shares at the same offering price to be established in the upcoming offering. Other unaffiliated investors purchased $6.4 million of Geospatial capital stock in the October 2009 through March 2010 private placements. While these investors have not raised allegations of misconduct against the Company or its officers, the Company's Board of Directors has concluded that such investors should be treated equitably with the investors that are party to the settlement agreement. Accordingly, the Company plans to offer all such investors settlements consistent with the terms outlined above. Mr. Smith has agreed to resign his position as Chairman and Chief Executive Officer and step-down from the Company's Board of Directors upon closing of the anticipated capital raise. At that time, the Board intends to appoint David Dresner to succeed Mr. Smith as CEO. Further, Timothy Sutherland would become non- executive Chairman of the Company's Board of Directors, while Thomas Ridge will continue to serve as a member of the Board. Mr. Dresner is the former CEO of Statoil Energy (a division of StatoilHydro) and a 20 year veteran of Pricewaterhouse Coopers where he served as Office Managing Partner. Mr. Sutherland is the Chairman and CEO of Pace Global Energy Services, LLC, a leading energy consulting and management company. "Speaking for myself and the Board, we are excited about the opportunities that lie ahead. Reduct, Geospatial and key stakeholders have invested a great deal of time and effort to realign the Company's operations and formulate a business model that provides a path for economic success. Under its new leadership, Geospatial will be well positioned to capitalize on the rapidly growing market opportunity for mapping underground infrastructure," said Timothy Sutherland. About Geospatial Holdings Sarver, Pa.-based Geospatial Holdings, Inc. (OTC BB: GSPH) -- http://www.GeospatialCorporation.com/-- through its wholly- owned subsidiary Geospatial Mapping Systems, Inc., doing business as Geospatial Corporation, utilizes proprietary technologies to determine the accurate location and position of underground pipelines, conduits and other underground infrastructure data allowing Geospatial to create accurate three-dimensional (3D) digital maps and models of all underground infrastructure. As reported in the Troubled Company Reporter on April 24, 2010, Goff Backa Alfera and Company, LLC, in Pittsburgh, Pa., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company has incurred net losses since inception. Operations and capital requirements since inception have been funded by sales of stock and advances from its chief executive officer, and current liabilities exceed current assets by $3.9 million. GLADIOLA WOOD-TOLSON: U.S. Trustee Seeks Chapter 7 Conversion ------------------------------------------------------------- Gladiola Delores Wood-Tolson and the United States Trustee for Region 4 have agreed to extend the time upon which the Debtor can file her response or objection to the U.S. Trustee's amended motion to convert the Debtor's case to one under Chapter 7 of the Bankruptcy Code, or in the alternative, dismiss the case. The Debtor's response was due April 7. The parties agreed to move the Debtor's response deadline to April 12. Bankruptcy Judge Paul Mannes approved the stipulation, a copy of which is available at http://is.gd/QBit53from Leagle.com. Gladiola Delores Wood-Tolson in Laurel, Maryland, filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 10-15331) on March 15, 2010, represented by: Rudolph E. DeMeo, Esq. THE LAW OFFICE OF RUDOLPH E. DEMEO, P.C. 1449 Light Street Baltimore, MD 21230 Tel: (410) 244-6544 Fax: (410) 547-1010 E-mail: redemeo@yahoo.com According to the schedules, the Debtor has assets of $3,442,238, and total liabilities of $2,467,774. GMX RESOURCES: David Lucke Does Not Own Any Securities ------------------------------------------------------ In a Form 3 filing with the U.S. Securities and Exchange Commission, David J. Lucke, a director at GMX Resources Inc., disclosed he does not own any securities of the Company. About GMX Resources GMX Resources Inc. -- http://www.gmxresources.com/-- is an independent natural gas production company headquartered in Oklahoma City, Oklahoma. GMXR has 53 producing wells in Texas & Louisiana, 24 proved developed non-producing reservoirs, 48 proved undeveloped locations and several hundred other development locations. GMXR has 9,000 net acres on the Sabine Uplift of East Texas. GMXR has 7 producing wells in New Mexico. The Company's strategy is to significantly increase production, revenues and reinvest in increasing production. GMXR's goal is to grow and build shareholder value every day. The Company's balance sheet at Dec. 31, 2010 showed $507.09 million in total assets, $368.87 million in total liabilities and $138.22 million in total equity. The Company reported a net loss of $138.29 million on $96.52 million of oil and gas sales for the year ended Dec. 31, 2010, compared with a net loss of $181.08 million on $94.29 million of oil and gas sales during the prior year. * * * GMX Resources got a first time 'Caa1' Corporate Family Rating and SGL-3 Speculative Grade Liquidity rating from Moody's Investors Service in February 2011. GMX's 'Caa1' CFR reflects its small size, limited diversification, production that is 97% natural gas in a low gas price environment, high leverage on production and reserves, and the risks inherent in developing its newly acquired oil focused Bakken and Niobrara acreage while outspending cash flow," commented Jonathan Kalmanoff, Moody's Analyst. "The rating also considers the potential for improvement in both profitability and diversification if GMX is successful in developing its newly acquired acreage, the pre-funding of the majority of 2011 capital spending through both debt and equity offerings, a lack of required drilling to hold acreage in the company's East Texas properties, and hedges in place which add support to realized prices for gas production through 2012." Standard & Poor's Ratings Services in February 2011 said it assigned its preliminary 'B-' corporate credit rating to GMX Resources Inc. The outlook is stable. "The ratings on Oklahoma City-based GMX Resources Inc. reflect the company's limited scale of operations, meaningful exposure to weak natural gas prices, a very aggressive near-term spending plan, limited liquidity beyond 2011, and elevated debt leverage," said Standard & Poor's credit analyst Paul B. Harvey. GOARANY DEVELOPERS: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Goarany Developers, Inc. 3 Bristol Drive Middletown, NY 10941 Bankruptcy Case No.: 11-36000 Chapter 11 Petition Date: April 12, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Poughkeepsie) Judge: Cecelia G. Morris Debtor's Counsel: Lawrence F. Morrison, Esq. LAWRENCE MORRISON, ATTORNEY AT LAW 140 East 45th Street, 19th Floor New York, NY 10017 Tel: (212) 655-3582 Fax: (646) 539-3682 E-mail: morrlaw@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Mohamed El-Goarany, president. GREENBRIER COS: Announces Results to Date of Tender Offer --------------------------------------------------------- The Greenbrier Companies, Inc., announced Wednesday that, pursuant to the terms of its previously announced tender offer and consent solicitation for its outstanding 8 3/8% Senior notes due 2015, holders of $90,599,000 aggregate principal amount of the outstanding Notes (approximately 38.55% of the total outstanding) have validly tendered their Notes and have delivered consents for the proposed amendments to the indenture governing the Notes prior to the expiration of the consent date, which was 5:00 p.m., New York City time, on April 12, 2011. In addition, Greenbrier announced that it has waived the condition to acceptance of the Notes for payment set forth in its Offer to Purchase and Consent Solicitation Statement, dated as of March 30, 2011, that the requisite consents from the holders of at least a majority in aggregate principal amount of the outstanding Notes to the proposed amendments to the Indenture be received and that a supplemental indenture related thereto be executed. Accordingly, Greenbrier has accepted for purchase and payment all of the Notes that were validly tendered and not validly withdrawn prior to the Consent Payment Deadline for a price of $1,031.67 per $1,000 principal amount of Notes, which includes a consent payment of $10.00 per $1,000principal amount of Notes, plus accrued and unpaid interest to, but not including, the Early Settlement Date. Payment for the Notes pursuant to the Early Settlement is expected to be made on April 13, 2011. The terms of the tender offer and consent solicitation are detailed in Greenbrier's Statement and related letter of transmittal dated as of March 30, 2011. The tender offer and consent solicitation remains open and will expire at 8:00 a.m., New York City time, on April 27, 2011, unless extended. Notes tendered and consents delivered pursuant to the tender offer and consent solicitation may no longer be withdrawn or revoked. Holders who validly tender their Notes after the Consent Payment Deadline and prior to the Expiration Time will be eligible to receive the tender offer consideration of $1,021.67 per $1,000 principal amount of Notes, plus accrued and unpaid interest to, but not including, the settlement date, but will not receive the consent payment of $10.00 per $1,000 principal amount of Notes. Greenbrier also announced that it is issuing a notice of redemption for any and all of its Notes that remain outstanding after the consummation of its tender offer and consent solicitation. The Notes will be redeemed on May 16, 2011 at a redemption price equal to 102.792% of the outstanding principal amount thereof, plus accrued and unpaid interest to the redemption date. About Greenbrier Cos. Based in Lake Oswego, Oregon, The Greenbrier Companies Inc. operates in three primary business segments: manufacturing, refurbishment and parts, and leasing and services. The manufacturing segment, operating from four facilities in the United States, Mexico and Poland, produces double-stack intermodal railcars, conventional railcars, tank cars and marine vessels. The refurbishment & parts segment performs railcar repair, refurbishment and maintenance activities in the United States and Mexico. The leasing & services segment owns roughly 8,000 railcars and provides management services for roughly 225,000 railcars. * * * As reported by the TCR on April 5, 2011, Moody's Investors Service upgraded the ratings for The Greenbrier Companies Inc. Corporate Family Rating to B3 from Caa1. The upgrade of the CFR reflects Moody's expectations that Greenbrier's earnings, revenues and financial performance will improve over the next 12 to 18 months as a result of growing demand for rail cars. Greenbrier is well position to benefit from improving industry conditions in the rail car manufacturing and leasing businesses, where continued growth in overall railroad freight volume will likely result in robust demand growth for new railcars. Greenbrier carries 'B-' issuer credit ratings from Standard & Poor's Ratings Services. S&P said in May 2010 that the ratings on Greenbrier reflect the company's fair business risk profile stemming from the cyclicality of the freight car manufacturing industry; the dramatic decline in demand for new railcars as a result of slower economic growth and weaker carloadings; and limited customer diversity. The Company, according to S&P, also has a highly leveraged financial risk profile, marked by increased debt balances as a result of acquisitions completed in recent years. GREENWICH SENTRY: Creditors Have Until May 23 to File Claims ------------------------------------------------------------ The Hon. Burton R. Lifland of the U.S. Bankruptcy Court for the Southern District of New York set May 23, 2011, as the deadline for creditors of Greenwich Sentry L.P. and Greenwich Sentry Partners L.P. to file proofs of claim. All proofs of claim must be filed at: U.S. Bankruptcy Court for Southern District of New York Alexander Hamilton Custom House, One Bowling Green, Room 534 New York, New York 10004-1408 About Greenwich Sentry Liquidators of Fairfield Sentry Limited, filed a Chapter 15 petition for Fairfield in June 2010 (Bankr. S.D.N.Y. Case No. 10-13164). In July 2010, Kenneth Krys and Christopher Stride of Krys & Associates (BVI) Limited, the liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited obtained cross-border recognition as foreign main proceedings by the U.S. Bankruptcy Court of the funds' insolvency proceedings, pending in the British Virgin Islands. The liquidators are represented in the U.S. by Brown Rudnick LLP. Fairfield Sentry Limited was the largest "feeder fund" to Bernard L. Madoff Investment Securities LLC, and invested approximately 95% of its assets with BLMIS. BLMIS was placed into liquidation proceedings in the United States in December 2008, after it was revealed that Bernard Madoff operated BLMIS as a Ponzi scheme for many years. Fairfield Sigma Limited and Fairfield Lambda Limited were both feeder funds of Fairfield Sentry Limited, and invested all of their assets with Fairfield Sentry Limited. Greenwich Sentry, L.P., and an affiliate filed for Chapter 11 protection on Nov. 19, 2010 (Bankr. S.D.N.Y. Case No. 10-16229) hoping to settle lawsuits filed against it in connection with its investments with Bernard L. Madoff. Paul R. DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP, in New York, represents the Debtors in the Chapter 11 cases. Bernard L. Madoff was charged by the Securities and Exchange Commission in December 2008 of orchestrating the largest Ponzi scheme in history, with losses topping US$50 billion. In March 2009, Mr. Madoff pleaded guilty to 11 federal crimes and admitted to turning his wealth management business into a Ponzi scheme. A trustee was appointed to liquidate and has been filing clawback suits against investors who withdrew phony profits from Mr. Madoff. On May 18, 2009, Irving H. Picard, the trustee liquidating the estate of Mr. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC, filed a lawsuit against Fairfield Sentry and Greenwich, seeking the return of $3.55 billion that Fairfield withdrew from Madoff during the period from 2002 to Madoff's arrest in December 2008. Since 1995, the Fairfield funds invested about $4.5 billion with BLMIS. Mr. Picard claims that Fairfield knew or should have known about the fraud give that it received from BLMIS unrealistically high and consistent annual returns of between 10% and 21% in contrast to the vastly larger fluctuations in the S&P 100 Index. In schedules filed with the Court, Greenwich Sentry disclosed $317,073,770 in total assets and $206,337,244 in total liabilities. GREENWICH SENTRY: Has Until June 17 to File Chapter 11 Plan ----------------------------------------------------------- The Hon. Burton R. Lifland of the U.S. Bankruptcy Court for the Southern District of New York extended the exclusive periods of Greenwich Sentry L.P. and Greenwich Sentry Partners L.P. to file a Chapter 11 plan of reorganization until June 17, 2011, and solicit acceptances of that plan until Aug. 16, 2011. As reported in the March 30, 2011 edition of the Troubled Company Reporter, in justifying the requested extension, the Debtors narrated that they consider themselves "net losers" in the SIPA proceedings of Bernard L. Madoff Investment Securities LLC to the extent of roughly $140 million for GS and for GSP. The Debtors also face an adversary proceeding, brought by Irving H. Picard, Esq., trustee for the substantively consolidated SIPA liquidation of BLMIS, asserting "claw back" claims against the Debtors and others, and seeking to disallow the Debtors' claims in the BLMIS SIPA proceeding. The Debtors have been named as parties in several civil actions, pending in various courts and in different stages of litigation, arising out of their accounts at BLMIS. The Debtors noted that they have been negotiating a settlement of the claims of the BLMIS Trustee. Counsel for the Debtors have attended multiple settlement conferences and have been exchanging proposed settlement drafts with counsel for the BLMIS Trustee and other key parties-in-interest. It is intended that the settlement, when finalized, will be accomplished through a plan of reorganization for the Debtors whose objective will be to return maximum value to the innocent limited partners of both Debtors. About Greenwich Sentry Liquidators of Fairfield Sentry Limited, filed a Chapter 15 petition for Fairfield in June 2010 (Bankr. S.D.N.Y. Case No. 10-13164). In July 2010, Kenneth Krys and Christopher Stride of Krys & Associates (BVI) Limited, the liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited obtained cross-border recognition as foreign main proceedings by the U.S. Bankruptcy Court of the funds' insolvency proceedings, pending in the British Virgin Islands. The liquidators are represented in the U.S. by Brown Rudnick LLP. Fairfield Sentry Limited was the largest "feeder fund" to Bernard L. Madoff Investment Securities LLC, and invested approximately 95% of its assets with BLMIS. BLMIS was placed into liquidation proceedings in the United States in December 2008, after it was revealed that Bernard Madoff operated BLMIS as a Ponzi scheme for many years. Fairfield Sigma Limited and Fairfield Lambda Limited were both feeder funds of Fairfield Sentry Limited, and invested all of their assets with Fairfield Sentry Limited. Greenwich Sentry, L.P., and an affiliate filed for Chapter 11 protection on Nov. 19, 2010 (Bankr. S.D.N.Y. Case No. 10-16229) hoping to settle lawsuits filed against it in connection with its investments with Bernard L. Madoff. Paul R. DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP, in New York, represents the Debtors in the Chapter 11 cases. Bernard L. Madoff was charged by the Securities and Exchange Commission in December 2008 of orchestrating the largest Ponzi scheme in history, with losses topping US$50 billion. In March 2009, Mr. Madoff pleaded guilty to 11 federal crimes and admitted to turning his wealth management business into a Ponzi scheme. A trustee was appointed to liquidate and has been filing clawback suits against investors who withdrew phony profits from Mr. Madoff. On May 18, 2009, Irving H. Picard, the trustee liquidating the estate of Mr. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC, filed a lawsuit against Fairfield Sentry and Greenwich, seeking the return of $3.55 billion that Fairfield withdrew from Madoff during the period from 2002 to Madoff's arrest in December 2008. Since 1995, the Fairfield funds invested about $4.5 billion with BLMIS. Mr. Picard claims that Fairfield knew or should have known about the fraud give that it received from BLMIS unrealistically high and consistent annual returns of between 10% and 21% in contrast to the vastly larger fluctuations in the S&P 100 Index. In schedules filed with the Court, Greenwich Sentry disclosed $317,073,770 in total assets and $206,337,244 in total liabilities. GRIND COFFEE: First Bank's Collateral Valued at $350,000 -------------------------------------------------------- Bankruptcy Judge Katharine M. Samson ruled that the value of the collateral held as security by First Bank and Trust, and, accordingly, the amount of First Bank's allowed secured claim against The Grind Coffee & Nosh, LLC, is $350,000. A copy of the Court's April 4, 2011 Memorandum Opinion and Order is available at http://is.gd/w5gdnlfrom Leagle.com. In March 2011, the Court denied the bank's request for relief from the automatic stay but granted its request for adequate protection. The Grind Coffee & Nosh, LLC, filed for Chapter 11 protection (Bankr. S.D. Miss. Case No. 11-50011) on Jan. 4, 2011, estimating under $1 million in assets and debts. The Debtor is represented by William J. Little Jr., Esq., at Lentz & Little, PA. GRUBB & ELLIS: Fails to Get Consents to Amend 2010 Indenture ------------------------------------------------------------ The consent solicitation of Grubb & Ellis Company with respect to its 7.95% Senior Convertible Notes Due 2015, which the Company initially launched on March 8, 2011, to seek the approval to amend certain provisions in Section 9.01 of the Indenture, dated as of May 7, 2010 which governs the Notes, expired at 5:00 p.m., New York City time, on April 11, 2011. The Company did not receive the requisite consents from the holders of the Notes to amend the Indenture and accordingly, the Indenture remains unchanged. The Company retains the right to re-solicit consents pursuant to a new consent solicitation at a future date should it choose to do so. About Grubb & Ellis Santa Ana, Calif.-based Grubb & Ellis Company (NYSE: GBE) -- http://www.grubb-ellis.com/-- is a commercial real estate services and investment management company with over 5,200 professionals in more than 100 company-owned and affiliate offices throughout the United States. The Company's range of services includes tenant representation, property and agency leasing, commercial property and corporate facilities management, property sales, appraisal and valuation and commercial mortgage brokerage and investment management. Through its investment management business, the Company is a leading sponsor of real estate investment programs. The Company reported a net loss of $69.7 million on $575.5 million of revenues for 2010, compared with a net loss of $80.5 million on $527.9 million of revenues for 2009. At Dec. 31, 2010, the Company's balance sheet showed $286.9 million in total assets, $255.8 million in total liabilities, $90.1 million in 12% cumulative participating perpetual convertible preferred stock, and a stockholders' deficit of $59.0 million. HARRY & DAVID: Section 341(a) Meeting Set for April 27 ------------------------------------------------------ Roberta A. DeAngelis, the U.S. Trustee for Region 3, will convene a meeting of creditors of Harry & David Holdings Inc. and its debtor-affiliates on April 27, 2011, at 1:00 p.m., at J. Caleb Boggs Federal Building, 2nd Floor, Room 2112. This is the first meeting of creditors required under Section 341(a) of the U.S. Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. About Harry & David Medford, Oregon-based Harry & David Holdings, Inc. -- aka Bear Creek Corporation; Bear Creek Direct Marketing, Inc.; Bear Creek Stores, Inc.; Bear Creek Operations, Inc.; and Bear Creek Orchards, Inc. -- is a multi-channel specialty retailer and producer of branded premium gift-quality fruit and gourmet food products and gifts marketed under the Harry & David(R), Wolferman's(R) and Cushman's(R) brands. It has 70 stores across the country. Harry & David Holdings filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-10884) on March 28, 2011. Affiliates Harry and David (Bankr. D. Del. Case No. 11-10885), Harry & David Operations, Inc. (Bankr. D. Del. Case No. 11-10886), and Bear Creek Orchards, Inc. (Bankr. D. Del. Case No. 11-10887) filed separate Chapter 11 petitions. Daniel J. DeFranceschi, Esq.; Paul Noble Heath, Esq.; and Zachary I Shapiro, Esq., at Richards Layton & Finger, serve as the Debtors' local counsel. David G. Heiman, Esq.; Brad B. Erens, Esq.; and Timothy W. Hoffman, Esq., at Jones Day, are the Debtors' legal counsel. Rothschild Inc. is the Debtors' investment banker. Alvarez & Marsal LLC is the Debtors' financial advisor. Garden City Group Inc. is the Debtors' claims and notice agent. The cases are jointly administered, with Harry David Holdings as lead case. Kristopher M. Hansen, Esq., and Erez E. Gilad, Esq., at Stroock & Stroock & Lavan LLP; Thomas B. Walper, Esq., at Munger, Tolles & Olson LLP; and Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP are counsel to principal noteholders. Moelis & Company is the financial advisor to the principal noteholders. Lowenstein Sandler has been retained as counsel to the unsecured creditors committee in the Harry & David bankruptcy case. The Debtors disclosed $304.3 million in total assets and $360.8 million in total debts as of Dec. 25, 2010. HARRY & DAVID: Wants June 17, 2011 General Claims Bar Date ---------------------------------------------------------- Harry & David Holdings Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to set June 17, 2011, as the deadline for creditors to file proofs of claim. The Debtors propose Sept. 26, 2011, as the deadline for governmental units to file proofs of claim. A hearing is set for April 27, 2011, at 9:30 a.m., to consider the Debtors' request. Objections, if any, are due April 19, 2011, at 4:00 p.m. About Harry & David Medford, Oregon-based Harry & David Holdings, Inc. -- aka Bear Creek Corporation; Bear Creek Direct Marketing, Inc.; Bear Creek Stores, Inc.; Bear Creek Operations, Inc.; and Bear Creek Orchards, Inc. -- is a multi-channel specialty retailer and producer of branded premium gift-quality fruit and gourmet food products and gifts marketed under the Harry & David(R), Wolferman's(R) and Cushman's(R) brands. It has 70 stores across the country. Harry & David Holdings filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-10884) on March 28, 2011. Affiliates Harry and David (Bankr. D. Del. Case No. 11-10885), Harry & David Operations, Inc. (Bankr. D. Del. Case No. 11-10886), and Bear Creek Orchards, Inc. (Bankr. D. Del. Case No. 11-10887) filed separate Chapter 11 petitions. Daniel J. DeFranceschi, Esq.; Paul Noble Heath, Esq.; and Zachary I Shapiro, Esq., at Richards Layton & Finger, serve as the Debtors' local counsel. David G. Heiman, Esq.; Brad B. Erens, Esq.; and Timothy W. Hoffman, Esq., at Jones Day, are the Debtors' legal counsel. Rothschild Inc. is the Debtors' investment banker. Alvarez & Marsal LLC is the Debtors' financial advisor. Garden City Group Inc. is the Debtors' claims and notice agent. The cases are jointly administered, with Harry David Holdings as lead case. Kristopher M. Hansen, Esq., and Erez E. Gilad, Esq., at Stroock & Stroock & Lavan LLP; Thomas B. Walper, Esq., at Munger, Tolles & Olson LLP; and Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP are counsel to principal noteholders. Moelis & Company is the financial advisor to the principal noteholders. Lowenstein Sandler has been retained as counsel to the unsecured creditors committee in the Harry & David bankruptcy case. The Debtors disclosed $304.3 million in total assets and $360.8 million in total debts as of Dec. 25, 2010. HARRY & DAVID: Asks for Approval of Jones Day as Counsel -------------------------------------------------------- Harry & David Holdings Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Jones Day as their counsel. The firm will advise the Debtors of their rights, powers and duties in continuing to operate and manage their respective businesses and properties under chapter 11 of the Bankruptcy Code. The firm will charge the Debtors based on the hourly rates of its professionals: Professional Designation Hourly Rate ------------ ----------- ----------- David G. Heiman, Esq. Partner $975 Brad B. Erens, Esq. Partner $800 Timothy W. Hoffmann, Esq. Associate $575 Joseph M. Tiller, Esq. Associate $500 Justin F. Carroll, Esq. Associate $475 The Debtors assure the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Harry & David Medford, Oregon-based Harry & David Holdings, Inc. -- aka Bear Creek Corporation; Bear Creek Direct Marketing, Inc.; Bear Creek Stores, Inc.; Bear Creek Operations, Inc.; and Bear Creek Orchards, Inc. -- is a multi-channel specialty retailer and producer of branded premium gift-quality fruit and gourmet food products and gifts marketed under the Harry & David(R), Wolferman's(R) and Cushman's(R) brands. It has 70 stores across the country. Harry & David Holdings filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-10884) on March 28, 2011. Affiliates Harry and David (Bankr. D. Del. Case No. 11-10885), Harry & David Operations, Inc. (Bankr. D. Del. Case No. 11-10886), and Bear Creek Orchards, Inc. (Bankr. D. Del. Case No. 11-10887) filed separate Chapter 11 petitions. Daniel J. DeFranceschi, Esq.; Paul Noble Heath, Esq.; and Zachary I Shapiro, Esq., at Richards Layton & Finger, serve as the Debtors' local counsel. David G. Heiman, Esq.; Brad B. Erens, Esq.; and Timothy W. Hoffman, Esq., at Jones Day, are the Debtors' legal counsel. Rothschild Inc. is the Debtors' investment banker. Alvarez & Marsal LLC is the Debtors' financial advisor. Garden City Group Inc. is the Debtors' claims and notice agent. The cases are jointly administered, with Harry David Holdings as lead case. Kristopher M. Hansen, Esq., and Erez E. Gilad, Esq., at Stroock & Stroock & Lavan LLP; Thomas B. Walper, Esq., at Munger, Tolles & Olson LLP; and Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP are counsel to principal noteholders. Moelis & Company is the financial advisor to the principal noteholders. Lowenstein Sandler has been retained as counsel to the unsecured creditors committee in the Harry & David bankruptcy case. The Debtors disclosed $304.3 million in total assets and $360.8 million in total debts as of Dec. 25, 2010. HARRISBURG, PA: Should Negotiate Before Ch. 9 Filing, Cravath Says ------------------------------------------------------------------ Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that legal advisers for Harrisburg, Pennsylvania, said the city should negotiate in good faith with creditors and consider selling assets before filing for municipal bankruptcy reorganization under Chapter 9. Cravath Swaine & Moore LLP, which agreed in November to represent the city at no cost, said that tax increases or cost cutting along won't solve financial problems. About Harrisburg, Pennsylvania The city of Harrisburg is coping with debt related to a failed revamp of an incinerator. The outstanding principal on the Incinerator debt is $288 million. Total principal and interest on this debt would amount to approximately $458 million. Debt service payments on the total incinerator debt are $20 million per year. Of this total, Dauphin County, Pennsylvania, is responsible for roughly $10 million and Harrisburg is responsible for the other $10 million. The city is guarantor on 100% of the $288 million Incinerator debt. The City Council of Harrisburg voted 5-2 on Sept. 28, 2010, to seek professional advice on bankruptcy or State oversight. Harrisburg needed state aid to avoid default on $3.3 million of bond payments this month. The city has missed about $8 million in debt-service payments this year on bonds issued in connection with a trash-to-energy incinerator. The city owes another $40 million by the end of the year, and was sued by its home county Dauphin County; bond insurer Assured Guaranty Municipal Corp., a unit of Assured Guaranty Ltd.; and bond trustees TD Bank and M&T Bank Corp. over $19 million in skipped bond payments. In November 2010, the city council tapped Cravath, Swaine and Moore LLP as debt restructuring advisors. Cravath is working on "pro bono" basis. HARVEST OAKS: Court Extends Use of Cash Collateral Through May 31 ----------------------------------------------------------------- Bankruptcy Judge Stephani W. Humrickhouse of the United States Bankruptcy Court, Raleigh, North Carolina authorized Harvest Oaks Drive Associates, LLC, to continue using cash collateral on an interim basis for its postpetition, necessary and reasonable operating expenses through May 31, 2011, subject to certain remaining provisions. On Feb. 22, 2011, CSMC 2006-C5 Strickland Road LLC and its special servicer, LNR Partners, Inc., the secured lender sought relief from the automatic stay to exercise their state law remedies for the Debtor's default under a note, including foreclosure. In the event the Court grants the Motion for Relief from Stay, the Interim Order will cease to be effective. On Aug. 9, 2006, the Debtor executed a promissory note amounting $13,475,000 in favor of Column Financial, Inc. The Note is secured by, among other things, a Deed of Trust, Security Agreement and Financing Statement on the Shopping Center recorded in the Wake County Register of Deeds. The Note, Deed of Trust, Assignment and other loan documents were subsequently assigned to Wells Fargo, N.A., as trustee for the registered Holders of Credit Suisse First Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates, Series 2006-C5, and then assigned to CSMC 2006-C5 Strickland Road LLC. A further hearing will be held on May 18, 2011 at 10:00 a.m. at the United States Bankruptcy Court, Raleigh, North Carolina. About Harvest Oaks Raleigh, North Carolina-based Harvest Oaks Drive Associates, LLC, is engaged in the business of leasing retail shopping space. Harvest Oaks Drive Associates filed for Chapter 11 bankruptcy protection (Bankr. E.D.N.C. Case No. 10-03145) on April 21, 2010. Trawick H Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., assists the Company in its restructuring effort. The Company disclosed $15,832,000 in assets and $14,634,161 in debts in its Schedules of Assets & Liabilities. HARVEST OAKS: Court Reschedules Confirmation Hearing to June 30 --------------------------------------------------------------- The Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the Eastern District of North Carolina has continued until June 30, 2011, at 10:00 a.m., the hearing to consider the confirmation of Harvest Oaks Drive Associates, LLC's Plan of Reorganization. As reported in the Troubled Company Reporter on Aug 30, 2010, according to the Disclosure Statement, the Plan contemplates a continuation of the Debtor's business. The Debtor intends to satisfy creditor claims from income earned through operations of its shopping center business, and from funds advanced by the guarantors of the Wachovia obligation. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/HARVESTOAKS_DS.pdf About Harvest Oaks Raleigh, North Carolina-based Harvest Oaks Drive Associates, LLC, filed for Chapter 11 bankruptcy protection on April 21, 2010 (Bankr. E.D. N.C. Case No. 10-03145). Trawick H Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., assists the Company in its restructuring effort. In its schedules, the Company disclosed $15,832,000 in assets and $14,634,161 in debts. HASSEN REAL ESTATE: Case Summary & 10 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Hassen Real Estate Partnership 100 North Barranca Avenue, Suite 900 West Covina, CA 91791-1600 Bankruptcy Case No.: 11-25499 Chapter 11 Petition Date: April 10, 2011 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Richard M. Neiter Debtor's Counsel: Christine M. Pajak, Esq. STUTMAN, TREISTER & GLATT PROFESSIONAL CORPORATION 1901 Avenue Of The Stars, 12th Floor Los Angeles, CA 90067 Tel: (310) 228-5600 E-mail: cpajak@stutman.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Tarek Alhassen, secretary of Hassen Real Estate Corporation, general partner. Affiliate that simultaneously filed separate Chapter 11 petition: Debtor Case No. ------ -------- Eastland Tower Partnership 11-25500 Hassen Real Estate's List of 10 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Athens Services Trade Debt $3,390 14048 E. Valley Boulevard City of Industry, CA 91746 Arcadia Property Services Inc. Trade Debt $1,950 11730 Hallwood Drive El Monte, CA 91732 Precision Air Conditioning and Trade Debt $1,826 Mech Inc. P.O. Box 8488 Long Beach, CA 90808 Southern California Edison Trade Debt $1,679 Newman and Nelson Inc. Trade Debt $75 Suburban Water Systems Trade Debt unknown Hydro Connections Inc. Trade Debt unknown Encore Lighting Trade Debt unknown Ace Pelizon Plumbing Trade Debt unknown Verizon California Trade Debt unknown HERCULES OFFSHORE: Lisa Rodriguez to Resign as VP Human Resources ----------------------------------------------------------------- Lisa W. Rodriguez informed Hercules Offshore, Inc., of her intention to resign as Vice President, Human Resources, to be effective on a mutually agreed date prior to the Annual Meeting of Stockholders to be held on May 10, 2011. The Company will consider internal candidates for the position. About Hercules Offshore Hercules Offshore Inc. (NASDAQ: HERO) -- http://www.herculesoffshore.com/-- provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the United States, Gulf of Mexico and internationally. The Company provides these services to integrated energy companies, independent oil and natural gas operators and national oil companies. The Company operates in six business segments: Domestic Offshore, International Offshore, Inland, Domestic Liftboats, International Liftboats and Delta Towing. The Company reported a net loss of $134.59 million on $657.48 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $91.73 million on $742.85 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $1.99 billion in total assets, $1.14 billion in total liabilities and $853.13 million in stockholders' equity. The Troubled Company Reporter said on November 17, 2010, Moody's Investors Service downgraded the Corporate Family Rating of Hercules Offshore Inc. and the Probability of Default Rating to Caa1 from B2. Moody's also downgraded Hercules' 10.5% senior secured notes due 2017, its senior secured revolving credit facility due 2012, and its senior secured term loan B due 2013, all to Caa1 with LGD3, 45%. The outlook remains negative. "The inability of Hercules to generate meaningful free cash flow despite limited reinvestment in its aging fleet of rigs is cause for concern," commented Stuart Miller, Moody's Senior Analyst. "Without a significant de-leveraging of its balance sheet, Hercules is following a path that could lead to financial hardship at the first sign of a market softening." Hercules' Caa1 CFR rating reflects its highly leveraged balance sheet and limited ability to generate free cash flow. The Caa1 rating on the senior secured notes reflects their pari passu secured position in Hercules' capital structure relative to the senior secured credit facilities. HILTON STEIN: Former Clients' Lawsuit Goes to Trial --------------------------------------------------- Hilton L. Stein filed a motion for summary judgment seeking dismissal of the adversary complaint, Dr. Monica Mehta, Physical Medicine & Rehabilitation Services, Inc., and Monica Mehta, M.D., P.A., v. Hilton L. Stein, Adv. Pro. No. 02-04013 (Bankr. D. N.J.), or, in the alternative, entry of an order permitting him to submit expert reports. The Plaintiffs object. They seek to have the debt owed by the Defendant declared non-dischargeable pursuant to 11 U.S.C. Sections 523(a)(4), (a)(2)(A), and (a)(2)(B). The Plaintiffs' Complaint alleges that (i) the Defendant committed fraud or defalcation while acting in a fiduciary capacity; (ii) the Defendant procured the debt through false pretenses, a false representation, or actual fraud; and (iii) the Defendant procured the debt through the use of materially false written statement respecting his financial condition. The Plaintiffs filed a cross- motion to compel the Defendant to pay $632.24 for photocopying and duplicating costs incurred during discovery. In his April 4, 2011 Opinion, Bankruptcy Judge Donald H. Steckroth denied the Defendant's motion for summary judgment and directed the Defendant to submit his expert reports within 45 days from the entry of the accompanying Order. The Plaintiffs' cross-motion to recover costs is denied at this time. In November 2001, the Plaintiffs retained the Defendant to pursue a legal malpractice claim against the law firm of Blume, Goldfaden, et al. and attorney Michael Wittenberg. The parties negotiated a Retainer Agreement, including a cap on fees at $75,000. The Plaintiffs paid the Defendant an initial sum of $40,000. A copy of the Court's ruling is available at http://is.gd/rJgFbD from Leagle.com. Approximately six months later, on June 10, 2002, the Defendant filed a voluntary petition under chapter 11 of the Bankruptcy Code (Bankr. D. N.J. Case No. 02-36276). On Sept. 30, 2002, the Court appointed a Chapter 11 Trustee. On Nov. 18, 2002, upon motion by the Trustee, the case was converted to one under chapter 7. HQ SUSTAINABLE: Gets NYSE Amex Noncompliance Notice --------------------------------------------------- HQ Sustainable Maritime Industries, Inc., has received a notice from the NYSE Amex LLC notifying the Company that, following resignation of its independent non-executive director and the Chairman of the Audit Committee effective April 6, 2011 (as disclosed in the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on April 11, 2011), the Company was not in compliance with continued listing standards set forth under Sections 802(a) and 803(B)(2)(a) of the Exchange Company Guide. The foregoing Sections require a listed company to maintain a majority of independent directors on its Board of Directors and at least three independent directors on the company's Audit Committee. The Exchange staff noted that the Company will have until the earlier of (i) its next annual shareholder meeting or (ii) April 6, 2012, to regain compliance with the foregoing continued listing requirements. The Company has commenced its search for a candidate to fill in the vacancy resulting from the director resignation and will endeavor to complete the process and appoint such replacement to the Board and the Audit Committee as soon as practicable. The Company was previously notified that it was not in compliance with continued listing standards set forth under Sections 134 and 1101 of the Exchange Company Guide since the Company was yet to file its Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2010. The trading in the Company's securities remains halted. A .BC indicator will be attached to the Company's ticker symbol in addition to the .LF indicator previously appended. About HQ Sustainable Maritime HQ Sustainable Maritime Industries, Inc., produces and markets health products derived from marine based raw materials as well as Tilapia resulting from vertically integrated operations. HQS practices cooperative farming of sustainable aquaculture, produces all-natural enriched feeds, Tilapia value added products and health products. The Company markets its nutraceutical and health products, including its "Omojo" branded health products through retail and franchise sales in China. Some of these products are now being introduced to the United States. The World Brand Laboratory and also the China Health Care Association have recognized these as China leading Health product brands. The Company produces and sells certified, value added Seafood products, including "Gluten Free" "Lillian's Healthy Gourmet" products in the United States through its Seattle based affiliate. US based sales have been expanded to include "Omojo" health products. HSRE-CDS I: Has Interim Access to Cash Collateral Until May ----------------------------------------------------------- HSRE-CDS I, LLC, sought and obtained interim authorization from the Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware to use the cash collateral until May 2011. As of Dec. 31, 2009, the Debtor entered into an amended and restated loan agreement with KeyBank National Association, whereby the Lender agreed to make a loan to the Debtor in the principal amount of $22,089,187 with an initial maturity date of Dec. 31, 2011. The Loan is secured by mortgages and deeds of trust encumbering all of the Debtor's properties in favor of the Lender. The Debtor is currently indebted on the Loan in the approximate amount of $22 million plus accrued and unpaid interest and costs and fees. On March 30, 2011, the Lender is believed to have sold, transferred, or assigned the prepetition loan documents to Gulfstream Capital Partners or special purpose entity GB HoldCo, LLC. R. Craig Martin, Esq., at DLA Piper LLP (US), explained that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/HSRE-CDS_budget.pdf In exchange for using the cash collateral, the Debtor will grant the Lender adequate protection to the extent of any diminution of the Lender's interest as of the Petition Date, in the form of additional and replacement security interests in and liens upon certain of the Debtor's prepetition and postpetition property and assets. GB HoldCo Objection GB HoldCo objected to the Debtor's use of cash collateral, saying that the Chapter 11 proceeding is an ill-conceived attempt by the Debtor to derail GB HoldCo's foreclosure of the Debtor's real property in Missouri that has no ability to service the secured debt with which it is encumbered. "With no strategy in place to satisfy its mortgage indebtedness -- presently in excess of $22 million -- the Debtor now seeks this Court's countenance in delaying GB HoldCo's attempts to execute on its collateral under the guise of a purported reorganization effort. In reality, this is a classic two-party dispute/bad faith filing initiated one day before a scheduled foreclosure. Accordingly, in the near term, GB HoldCo intends to move for the entry of an order: (a) dismissing the Debtor's Chapter 11 petition . . . or, alternatively, (b) granting relief from the automatic stay," GB HoldCo stated. GB HoldCo possess valid mortgage liens on the Debtor's real property in Missouri and Louisiana, which have been in default for over one year. GB HoldCo said that because it holds a present and absolute assignment of rents and income from the Debtor, the Debtor lacks any ownership interest in those rents and income. "As such, the Debtor's rental revenue from its real estate is not cash collateral, requiring denial of the cash collateral motion," GB HoldCo stated. GB HoldCo asked that the Debtor immediately turn over to GB HoldCo that portion of the collateral constituting cash collateral that is in the Debtor's possession or in any accounts at any financial institutions or otherwise under the Debtor's control. GB HoldCo also wanted the Debtor to segregate and account for any and all cash collateral presently in its possession and control, or hereafter received by the debtor, or any entity under the Debtor's control, from any source whatsoever, and to turn over to GB HoldCo any additional cash collateral as collected and segregated. Final Hearing The Court has set a final hearing for May 10, 2011, at 11:00 a.m. (Eastern time) on the Debtor's request for authorization to use cash collateral. About HSRE-CDS I Irving, Texas-based HSRE-CDS I, LLC, is a real estate company engaged in the acquisition, ownership, operation, management, leasing, financing, mortgaging and selling of real property. HSRE-CDS I filed for Chapter 11 bankruptcy protection on March 31, 2011 (Bankr. D. Del. Case No. 11-10972). The Debtor has not had sufficient time to discuss with the new lender the terms and conditions to use any cash collateral. The bankruptcy case will allow the Debtor the breathing room to negotiate with the new lender about issues likely to be key in this case. R. Craig Martin, Esq., at DLA Piper LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $10 million to $50 million. HSRE-CDS I: Has Nod to Pay Critical Vendors' Prepetition Claims --------------------------------------------------------------- HSRE-CDS I, LLC, sought and obtained authorization from the Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware to pay $10,000 prepetition claims of critical vendors. According to the Debtor, the Critical Vendors provide services that are essential in making the Debtor's real property safe and comfortable places to live for the tenants. As the owner of properties housing exclusively college students, the Debtor must be able to have the properties cleaned, maintained and repaired immediately, and as necessary, even if it is in the middle of the night, or over a weekend. In particular, software provider RealPage, Inc., is the sole- source servicer of the type of property management software the Debtor uses in operating its properties. This software tracks tenants lease terms and payments and also includes many added services like background checks, credit card processing, and tracking of each tenants payments. The software also provides tenant ledger accounting, allowing the Debtor to record and track which tenants are delinquent on their rent payments. With many of the tenants utilizing credit cards to pay rent, any delay or disruption in the software provider's service would result in immediate harm to the Debtor's ability to maintain operations. Most of the companies that the Debtor anticipates it may have to treat as Critical Vendors are smaller local entities, like lawn- moving companies or cleaning companies, which requires the Debtor to prepay or pay at the time of service, for the Critical Vendor to continue to service the Debtor. The Debtor will treat as Critical Vendors those vendors that provide uniquely essential services to the Debtor's operations. About HSRE-CDS I Irving, Texas-based HSRE-CDS I, LLC, is a real estate company engaged in the acquisition, ownership, operation, management, leasing, financing, mortgaging and selling of real property. HSRE-CDS I filed for Chapter 11 bankruptcy protection on March 31, 2011 (Bankr. D. Del. Case No. 11-10972). The Debtor has not had sufficient time to discuss with the new lender the terms and conditions to use any cash collateral. The bankruptcy case will allow the Debtor the breathing room to negotiate with the new lender about issues likely to be key in this case. R. Craig Martin, Esq., at DLA Piper LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $10 million to $50 million. IMPACT CASH: Rocky Mountain Advisory's Miller Named as Receiver --------------------------------------------------------------- District Judge Dale Kimball appointed Gil A. Miller of Rocky Mountain Advisory, LLC as receiver for Impact Cash, LLC and Impact Payment Systems, LLC, in the case, SEC, v. John Scott Clark, et al. Civil No. 1:11-cv-46 (D. Utah). The District Court also froze District Judge Dale Kimball appointed Gil A. Miller of Rocky Mountain Advisory, LLC as receiver for Impact Cash, LLC and Impact Payment Systems, LLC, in the case, SEC, v. John Scott Clark, et al. Civil No. 1:11-cv-46 (D. Utah). The District Court also froze the company's assets and barred the destruction of documents. A copy of the District Court's April 1, 2011 order is available at http://is.gd/qzLst0from Leagle.com. As reported by the Troubled Company Reporter on March 30, 2011, the U.S. Securities and Exchange Commission obtained a court order freezing the assets of two online payday loan companies and their owner charged with perpetrating a $47 million offering fraud and Ponzi scheme. The SEC alleges that John Scott Clark of Hyde Park, Utah, promised investors astronomical annual returns of 80% on their investments in his companies -- Impact Cash LLC and Impact Payment Systems LLC. Investors were told their money would be kept in separate bank accounts and used to fund payday loans and other aspects of the companies' operations. However, Mr. Clark instead commingled investor funds into a single pool and used them to make unauthorized investments, pay fictitious profits to earlier investors, and finance his own lavish lifestyle. INDALEX LIMITED: Union Wins Landmark Court Ruling on Pensions ------------------------------------------------------------- The United Steelworkers union has won a landmark legal decision forcing Indalex Limited to honor pension obligations to employees. The Court of Appeal for Ontario ruled last Thursday that Indalex Limited did not fulfill its fiduciary duties to employees when the company filed for protection from creditors under the Companies' Creditors Arrangement Act (CCAA) in 2009. The ruling, which will benefit United Steelworkers (USW) members who worked at a former Indalex operation in Quebec, sets a precedent for providing greater benefits to pension plan members in cases of corporate insolvency. In many past cases, employees and pensioners have suffered drastic reductions in their pensions, as corporate assets were distributed first to creditors ranked ahead of pension plans. Toronto-based Indalex Limited, an aluminum extrusions manufacturer, wound up its employee pension plan on Dec. 31, 2006. At that time, the plan was underfunded. In 2009, Indalex filed for CCAA protection and obtained interim financing to continue operations while it sought to sell its assets. Indalex sold substantially all of its assets in a court- approved sale on July 20, 2009. At the hearing that approved the 2009 sale, the USW argued the company should use proceeds of the sale to satisfy pension plan deficiencies. The CCAA judge rejected those arguments, prompting the appeal by the USW and other pension plan members. In a unanimous ruling issued, a three-judge panel of the Court of Appeal upheld the USW's appeal. "Indalex knew that the plans were under-funded and that unless more funds were put into the plans, pensions would have to be reduced," Madam Justice Eileen Gillese stated in the court's decision. "The decisions that Indalex was unilaterally making had the potential to affect the plans' beneficiaries' rights, at a time when they were particularly vulnerable." About NUPGE The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. INDIANAPOLIS DOWNS: Has Court's Nod to Hire Epiq as Claims Agent ---------------------------------------------------------------- Indianapolis Downs, LLC, et al., sought and obtained authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Epiq Bankruptcy Solutions, LLC, as claims and noticing agent, nunc pro tunc to the Petition Date. Epiq will, among other things: a. prepare and serve required notices in the Debtors' bankruptcy cases; b. assist the Debtors with administrative tasks in the preparation of schedules of assets and liabilities and statements of financial affairs; c. maintain copies of proofs of claim and proofs of interest filed; and d. provide temporary employees to process claims, as necessary. Epiq will be paid based on the hourly rates of its professionals: Clark $34-$51 Case Manager (Level 1) $106-$149 IT Programming Consultant $119-$161 Case Manager (Level 2) $157-$187 Senior Case Manager $191-$234 Senior Consultant $250 A copy of the Debtors' service agreement with Epiq is available for free at: http://bankrupt.com/misc/INDIANAPOLIS_DOWNS_claimsagentpact.pdf Joseph N. Wharton, Esq., vice president and senior consultant at Epiq, assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Indianapolis Downs Indianapolis Downs, LLC, operates a "racino," which is a combined race track and casino, at a state-of-the-art 283 acre Shelbyville, Indiana site. It also operates two satellite wagering facilities in Evansville and Clarksville, Indiana. Total revenue for 2010 was $270 million, representing an 8.7% increase in 2009. The casino captured 53% of the Indianapolis market share. Indianapolis Downs was granted a permit to conduct a horse track operation in Shelvyville, Indiana, in July 2001, and started operating the track in 2002. It was granted permission to operate the casino at the racetrack operation in May 2007. The casino began operations in July 2010. Indianapolis Downs, LLC, and subsidiary, Indianapolis Downs Capital Corp., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 11-11046) in Wilmington, Delaware, on April 7, 2011. Indianapolis Downs estimated $500 million to $1 billion in assets and up to $500 million in debt as of the Chapter 11 filing. According to a court filing, the Debtor owes $98,125,000 on a first lien debt. It also owes $375,000,000 on secured notes and $72,649,048 on subordinated notes. Matthew L. Hinker, Esq., Scott D. Cousins, Esq., and Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP in Wilmington, Delaware, have been tapped as counsel to the Debtors. Christopher A. Ward, Esq., at Polsinelli Shughart PC, in Wilmington, Delaware, is the conflicts counsel. Lazard Freres & Co. LLC is the investment banker. Bose Mckinney & Evans LLP and Bose Public Affairs Group LLC serve as special counsel. Kobi Partners, LLC, is the restructuring services provider. FD U.S. Communications, Inc., is the corporate communications consultant. INDIANAPOLIS DOWNS: Taps Greenberg Traurig as Bankruptcy Counsel ---------------------------------------------------------------- Indianapolis Downs, LLC, et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ the law firm of Greenberg Traurig, LLP, as bankruptcy counsel, nunc pro tunc to the Petition Date. Greenberg Traurig can be reached at: Matthew L. Hinker, Esq. Scott D. Cousins, Esq. Victoria Watson Counihan, Esq. Greenberg Traurig, LLP The Nemours Building 1007 North Orange Street, Suite 1200 Wilmington, DE 19801 Tel: (703) 661-7668 Fax: (302) 661-7000 (302) 661-7360 E-mail: hinkerm@gtlaw.com bankruptcydel@gtlaw.com Greenberg Traurig has advised the Debtors that the current hourly rates applicable to the principal attorneys and paralegals proposed to represent the Debtors are: Professional Rater Per Hour ------------ -------------- Nancy A. Mitchell $945 David D. Cleary $595 Maria DiConza $805 Scott D. Cousins $755 Victoria W. Counihan $665 Kevin D. Finger $620 Elizabeth M. Connolly $420 James P. Madigan $405 Matthew L. Hinker $315 Kami Hoskins $255 Elizabeth Thomas $235 Other attorneys and paralegals will render services to the Debtors as needed. Generally, Greenberg Traurig's hourly rates are in these ranges: Professional Rater Per Hour ------------ -------------- Shareholders $340-$1,100 Of Counsel $360-$935 Associates $175-$610 Legal Assistants/Paralegals $60-$310 To the best of the Debtors' knowledge, assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Indianapolis Downs Indianapolis Downs, LLC, operates a "racino," which is a combined race track and casino, at a state-of-the-art 283 acre Shelbyville, Indiana site. It also operates two satellite wagering facilities in Evansville and Clarksville, Indiana. Total revenue for 2010 was $270 million, representing an 8.7% increase in 2009. The casino captured 53% of the Indianapolis market share. Indianapolis Downs was granted a permit to conduct a horse track operation in Shelvyville, Indiana, in July 2001, and started operating the track in 2002. It was granted permission to operate the casino at the racetrack operation in May 2007. The casino began operations in July 2010. Indianapolis Downs, LLC, and subsidiary, Indianapolis Downs Capital Corp., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 11-11046) in Wilmington, Delaware, on April 7, 2011. Indianapolis Downs estimated $500 million to $1 billion in assets and up to $500 million in debt as of the Chapter 11 filing. According to a court filing, the Debtor owes $98,125,000 on a first lien debt. It also owes $375,000,000 on secured notes and $72,649,048 on subordinated notes. Christopher A. Ward, Esq., at Polsinelli Shughart PC, in Wilmington, Delaware, is the conflicts counsel. Lazard Freres & Co. LLC is the investment banker. Bose Mckinney & Evans LLP and Bose Public Affairs Group LLC serve as special counsel. Kobi Partners, LLC, is the restructuring services provider. FD U.S. Communications, Inc., is the corporate communications consultant. Epiq Bankruptcy Solutions is the claims and notice agent. INDIANAPOLIS DOWNS: Wants Polsinelli Shughart as Conflicts Counsel ------------------------------------------------------------------ Indianapolis Downs, LLC, et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Polsinelli Shughart PC as special conflicts counsel to the Debtors, nunc pro tunc to the Petition Date. Polsinelli will represent the Debtors regarding matters the Debtors' lead bankruptcy counsel, Greenberg Traurig, LLP, will be unable to handle due to a conflict of interest, including issues related to a debtor-in-possession financing facility with Wells Fargo Bank, N.A., and any issues that may arise with The Cordish Company and International Gaming Technology. Polsinelli will work closely with Greenberg Traurig and the Debtors are confident that the assignment of tasks will be maintained efficiently and with a clear delineation of duties in order to prevent the duplication of efforts. Polsinelli has advised the Debtors that the current hourly rates applicable to the principal attorneys and paralegals proposed to represent the Debtors are: Professional Rate Per Hour ------------ ------------- Christopher A. Ward $425 Justin K. Edelson $255 Shanti M. Katona $255 Other attorneys and paralegals will render services to the Debtors as needed. Polsinelli's hourly rates are in these ranges: Professional Rate Per Hour ------------ ------------- Attorneys $200-$500 Paralegals $185 To the best of the Debtors' knowledge, Polsinelli is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Indianapolis Downs Indianapolis Downs, LLC, operates a "racino," which is a combined race track and casino, at a state-of-the-art 283 acre Shelbyville, Indiana site. It also operates two satellite wagering facilities in Evansville and Clarksville, Indiana. Total revenue for 2010 was $270 million, representing an 8.7% increase in 2009. The casino captured 53% of the Indianapolis market share. Indianapolis Downs was granted a permit to conduct a horse track operation in Shelvyville, Indiana, in July 2001, and started operating the track in 2002. It was granted permission to operate the casino at the racetrack operation in May 2007. The casino began operations in July 2010. Indianapolis Downs, LLC, and subsidiary, Indianapolis Downs Capital Corp., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 11-11046) in Wilmington, Delaware, on April 7, 2011. Indianapolis Downs estimated $500 million to $1 billion in assets and up to $500 million in debt as of the Chapter 11 filing. According to a court filing, the Debtor owes $98,125,000 on a first lien debt. It also owes $375,000,000 on secured notes and $72,649,048 on subordinated notes. Matthew L. Hinker, Esq., Scott D. Cousins, Esq., and Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP in Wilmington, Delaware, have been tapped as counsel to the Debtors. Lazard Freres & Co. LLC is the investment banker. Bose Mckinney & Evans LLP and Bose Public Affairs Group LLC serve as special counsel. Kobi Partners, LLC, is the restructuring services provider. FD U.S. Communications, Inc., is the corporate communications consultant. Epiq Bankruptcy Solutions is the claims and notice agent. INFOLINK GROUP: Trustee Directed to Re-Issue Stock Certificate -------------------------------------------------------------- WestLaw reports that a Chapter 11 debtor's majority shareholder received the stock certificates individually, in his own name and right, separate and apart from his spouse, contrary to his assertion that he, along with his wife, held the certificates as tenants by the entirety, shielding them from levy. Therefore, an order directing the debtor to re-issue the shares of stock previously issued to the shareholder and to deliver the re-issued stock certificates to the police for further disposition in aid of the execution of a state-court judgment against the shareholder, as requested by the judgment creditor and authorized by a state statute, was warranted. In re Infolink Group, Inc., --- B.R. ---- , 2011 WL 799770 (Bankr. S.D. Fla.). A copy of the Honorable A. Jay Cristol's Order dated Feb. 24, 2011, is available at http://is.gd/HUZseBfrom Leagle.com. Infolink Group, Inc., fka Infolink.com, Inc., and Infolink Information Services, Inc., filed chapter 11 petitions (Bankr. D. Del. Case Nos. 10-10981 and 10-10982) on Mar. 24, 2010, and the cases were transferred (Bankr. S.D. Fla. Case Nos. 10-26423 and 10-26436) to Florida on June 2, 2010. Drew M. Dilworth in Miami, Fla., serves as the Chapter 11 Trustee in the Debtors' cases, and is represented by Allison R. Day, Esq. -- aday@gjb-law.com -- and Carlos E. Sardi, Esq. -- csardi@gjb-law.com -- at Genovese Joblove & Battista, P.A., and Geoffrey S. Aaronson, Esq. -- gaaronson@aspalaw.com -- in Miami, Fla. JOHN STOKES: U.S. Trustee Suit Goes to Trial -------------------------------------------- In United States Trustee, v. John Patrick Stokes, No. 09-60265-7, Adv. Pro. No. 10-00063 (Bankr. D. Mont.), the U.S. Trustee seeks summary judgment against Mr. Stokes under Counts One-through-Six of the U.S. Trustee's complaint. The U.S. Trustee seeks summary judgment in Count One to deny Mr. Stokes' discharge under 11 U.S.C. Sec. 727(a)(2) for concealment of transfers or assets; Count Two under Sec. 727(a)(4)(A) for false oath or account; Count Three under Sec. 727(a)(4)(B) for presenting or using a false claim; Count Four under Sec. 727(a)(4)(C) for attempt to gain advantage; Count Five under Sec. 727(a)(5) for failure to explain loss of assets; Count Six under Sec. 727(a)(6)(A) for refusal to obey an order of the Court. Mr. Stokes objects that genuine issues of material fact remain with respect to all six Counts. He contends that he relied on his former attorney to prepare his original schedules, and that the U.S. Trustee failed to show genuine absence of material fact as to his intent under Sec. 727(a)(2) and Sec. 727(a)(4)(A), and the Court should not draw the inferences of intent as requested by the U.S. Trustee in deciding summary judgment. In his April 11, 2011 Memorandum of Decision, Bankruptcy Judge Ralph B. Kirscher denied the U.S. Trustee's request for failure to satisfy the heavy burden under Fed. R. Civ. P. 56(a) (applicable in adversary proceedings under Fed. R. Bankr. P. 7056) to show that there is no genuine issue as to any material fact. A copy of the Court's ruling is available at http://is.gd/dEWuZZfrom Leagle.com. John Stokes owned a Kalispell radio station. He filed for Chapter 11 bankruptcy protection (Bankr. D. Mont. Case No. 09-60265-7) on March 4, 2009. Mr. Stokes' bankruptcy filing included his two unregistered corporations, Z-600 Inc. and Skyline Broadcasting. In September 2009, the Bankruptcy Court denied Mr. Stokes' bid to withdraw his Chapter 11 bankruptcy filing and instead granted the U.S. Trustee's motion to convert the bankruptcy to Chapter 7. KMC REAL ESTATE: Files List of Five Largest Unsecured Creditors --------------------------------------------------------------- KMC Real Estate Investors LLC has filed with U.S. Bankruptcy Court for the Southern District of Indiana its list of five largest unsecured creditors, disclosing: Entity Nature of Claim Claim Amount ------ --------------- ------------ Healthcare Practice Consultants Accounting $6,732 3220 Office Pointe Place services Suite 100 rendered Louisville, KY 40220-5444 Branch Banking and Trust Co. 4601 Medical Undetermined 401 West Main Street Plaza Louisville, KY 40202 Way, Clarksville Indiana (Hospital (Undetermined Building and secured) Land) together with all personal property/hospital equipment Cardinal Health Undetermined 7000 Cardinal Place (Undetermined Dublin, OH 43017 secured) Clark County Treasurer 4601 Medical Undetermined Plaza (Undetermined Way, Clarksville secured) Indiana-Lot Number 2 in Veteran's Village, at the same appears of record in Plat Book 14, Page 79, recorded Rialto Capital Advisors 4601 Medical Undetermined Plaza (Undetermined Way, Clarksville secured) Indiana (Hospital Building and Land) together with all personal property/hospital equipment Clarksville, Indiana-based KMC Real Estate Investors LLC filed for Chapter 11 bankruptcy protection on April 1, 2011 (Bankr. S.D. Ind. Case No. 11-90930). Gary Lynn Hostetler, Esq., Courtney Elaine Chilcote, Esq., and Jeffrey A. Hokanson, Esq., at Hostetler & Kowalik, P.C., serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $100 million to $500 million. Affiliate Kentuckiana Medical Center, LLC, previously sought Chapter 11 protection on Sept. 9, 2010 (Bankr. S.D. Ind. Case No. 10-93039). KMS II: M&I Guaranty Action Goes to Sarasota County Court --------------------------------------------------------- M&I Marshall & Ilsley Bank, v. Marvin I. Kaplan, et al., Case No. 8:11-cv-352-T-23TGW (M.D. Fla.), sued the guarantors of a note issued to the plaintiff's predecessor in interest and moved for summary judgment. After the initiation of the action but before the motion for summary judgment, the primary obligor on the note, KMS II, LLC, filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code. On the morning of the summary judgment hearing the defendants removed the action to the United States Bankruptcy Court for the Middle District of Florida, Tampa Division. The plaintiff moves to remand and asserts (1) that the removal is "an obvious attempt to forum shop and delay entry of summary judgment" and (2) that "substantial discovery has been propounded in the State Court Action, significant motion practice has taken place with respect to such discovery, a magistrate has been appointed to hear discovery motions and other matters agreed to by the parties; in other words, the State Court Action has been quite active since it has been filed." Instead of responding to the motion to remand, the defendants move "to (1) refer and transfer [the] matter to the United States Bankruptcy Court for the Middle District of Florida, Tampa Division, and (2) extend time to respond to motion for remand." The defendants assert that "[t]his removed case is essentially a collateral attack by M&I MARSHALL & ILSLEY BANK . . . against the Defendants and is designed to circumvent the reorganization process in the KMS II, L.L.C. Chapter 11 case." In his April 6, 2011 Order, District Judge Steven D. Merryday granted the motion to remand, sending the action to the Circuit Court for Sarasota County, Florida, and denied the motion to transfer to bankruptcy court. A copy of the Court's ruling is available at http://is.gd/H7ZD1efrom Leagle.com. About KMS II KMS II, LLC, in Sarasota, Florida, filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 10-30506) on Dec. 23, 2010, represented by David S. Jennis, Esq. -- ecf@jennisbowen.com -- at Jennis & Bowen, P.L. In its petition, the Debtor listed $1 million to $10 million in both assets and debts. Affiliate AlphaRock, LLC, filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 09-11888) on June 5, 2009. LA JOLLA: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------- Debtor: La Jolla UTC Corp P.O. Box 1300 La Jolla, CA 92038 Bankruptcy Case No.: 11-05973 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court Southern District of California (San Diego) Debtor's Counsel: Vincent Renda, Esq. RENDA LAW OFFICES, P.C. 12626 High Bluff Drive, Suite #330 San Diego, CA 92130 Tel: (858) 755-2600 Fax: (858) 755-2626 E-mail: vr@rendalawoffices.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/casb11-05973.pdf The petition was signed by Anthony Renda, president. LAWRENCE KASSOVER: Plan Trustee Fails in Bid to Reopen Case ----------------------------------------------------------- District Judge Shira A. Scheindlin affirmed a bankruptcy court ruling denying R. Peyton Gibson's motion for an order to reopen the bankruptcy case of Lawrence Kassover. On May 1, 1998, Lawrence Kassover filed a petition for reorganization under Chapter 11 of the United States Bankruptcy Code. The following month, the Bankruptcy Court approved R. Peyton Gibson's appointment as Chapter 11 Trustee. In June 2000, the Bankruptcy Court issued an order confirming Ms. Gibson's First Amended Plan of Reorganization. The Plan called for the liquidation of the Debtor's assets through a liquidating trust and for Ms. Gibson to act as liquidating trustee. At the time of the filing, the Debtor owned two principal assets -- an undivided one-quarter interest in various real property and, a 5.66% interest in The Garden City Company, Inc. GCC was a closely-held corporation controlled primarily by members of the Debtor's extended family including the Debtor's cousin, and party to an action, Philip Kassover. The Plan required Ms. Gibson to "marshal, liquidate, and distribute" the Debtor's shares in GCC. To maximize the value of the Debtor's shares, the Plan authorized Ms. Gibson to pursue the disposition of GCC, as a whole, subject to the approval of the GCC shareholders and the Bankruptcy Court. In July 2002, both the Bankruptcy Court and a majority of the GCC shareholders approved a merger between GCC and Prism Venture Partners, LLC. Prism agreed to pay $2,000 per share to each GCC shareholder to effectuate the merger. The Merger Agreement provided for Ms. Gibson to act as the Disbursing Agent responsible for holding the Merger Consideration in trust. It further authorized Ms. Gibson to distribute the Merger Consideration to the former shareholders upon the production of certain documentation and the satisfaction of all monetary obligations owed by each shareholder to GCC. The merger was consummated on August 23, 2002, and the surviving corporation was named Garden City. As Disbursing Agent, Ms. Gibson disbursed the full Merger Consideration to each of the former shareholders for their shares in GCC with the exception of Philip Kassover, Ruth Kassover, and the Estate of Nathan Kassover. Allegedly, in June 2003, Garden City instructed Ms. Gibson to withhold the Merger Consideration owed the Kassovers and the Nathan Kassover Estate due to both their failure to provide certain documentation and their outstanding monetary obligations owed to Garden City. Several months later, Ms. Gibson distributed $322 per share to the Nathan Kassover Estate and $169 per share to Philip. In July 2005, the Kassovers, in their individual capacity and as executors of the Nathan Kassover Estate, filed suit in New York state court against Prism, Garden City, Ms. Gibson and the other shareholders alleging twelve state law claims. Among these, were two claims brought against Ms. Gibson for breach of contract and breach of fiduciary duty in both her representative and personal capacity for her failure to disburse the full Merger Consideration. In August 2005, Ms. Gibson removed the action to federal court where it was referred to the Bankruptcy Court. The Kassovers subsequently moved to remand the action to state court. The Bankruptcy Court held that the state claims lacked a close nexus to the bankruptcy proceeding and that the Bankruptcy Court had not retained post-confirmation subject matter jurisdiction over the dispute. The Bankruptcy Court further noted that the Kassovers were suing Ms. Gibson in her role as Disbursing Agent -- rather than in her role as liquidating trustee -- and any liability incurred as Disbursing Agent would have no effect on the Debtor's estate or the liquidating trust. The Bankruptcy Court remanded the action to New York state court on January 12, 2006. Upon remand, Ms. Gibson moved to dismiss the claims and asserted various affirmative defenses and counterclaims alleging that the Kassovers were not entitled to the Merger Consideration for failing to satisfy the preconditions established in the Merger Agreement. On January 19, 2007, the Supreme Court of New York (Freedman, J.) denied Ms. Gibson's motion to dismiss the breach of contract claim but dismissed the breach of fiduciary duty claim. On September 25, 2007, the court dismissed all of Ms. Gibson's counterclaims. The Appellate Division, First Department affirmed both these rulings on July 22, 2008. On July 2, 2008, the Supreme Court of New York (Freedman, J.) granted the Kassovers' motion for partial summary judgment on the breach of contract claim against Ms. Gibson in her representative capacity but dismissed the breach of contract claim against Ms. Gibson in her individual capacity. On June 9, 2009, the Supreme Court of New York (Kapnick, J.) entered judgment against Ms. Gibson in the amount of $1,825,598. In May 2010, the Appellate Division, First Department upheld the judgment against Ms. Gibson, amended the amount, and reinstated the breach of contract claim against her in her personal capacity. The Court of Appeals denied Ms. Gibson leave to appeal on September 14, 2010 and the single remaining breach of contract claim is currently proceeding to trial. On March 23, 2010, in response to a motion by Ms. Gibson, the Bankruptcy Court signed a Final Decree37 discharging Ms. Gibson as trustee and, on August 6, 2010, closed the bankruptcy proceeding. Less than two weeks later, on August 19, 2010, Ms. Gibson moved the Bankruptcy Court to reopen the proceedings pursuant to section 350 of the Bankruptcy Code. Ms. Gibson requested the reopening to thereafter seek a ruling enforcing the release provisions of the Plan, Confirmation Order and Final Decree. Ms. Gibson contends that the release provisions in the Plan, Confirmation Order and Final Decree pertaining to her role as Trustee and Liquidating Trustee apply equally to her role as Disbursing Agent pursuant to the Merger Agreement and, therefore, immunize her from the currently pending state court action. On October 27, 2010, after full briefing and a hearing, the Bankruptcy Court (Liflind, J.) denied Ms. Gibson's motion in its entirety. The Bankruptcy Court held that reopening was inappropriate because both it and the state court had repeatedly ruled that "Gibson's role as Disbursing Agent was separate and apart from her role as Liquidating Trustee." The Bankruptcy Court concluded that it had "no subject matter jurisdiction over the issue of whether Gibson can be held personally liable for her role as Disbursing Agent, which is before the State Court in an action that was remanded . . . in 2006." The case before the District Court is In re Lawrence Kassover, No. 10 Civ. 9366 (S.D.N.Y.). A copy of the Court's April 4, 2011 Opinion and Order is available at http://is.gd/QbRkqbfrom Leagle.com. LEE ENTERPRISES: S&P Assigns 'B' Corporate Credit Rating -------------------------------------------------------- Standard & Poor's Ratings Services said it assigned Davenport, Iowa-based Lee Enterprises Inc. its preliminary 'B' corporate credit rating. The rating outlook is negative. "At the same time, we assigned our preliminary 'B' rating (the same as the corporate credit rating) to the company's offering of $675 million first-priority lien senior secured notes due 2017 with a preliminary recovery rating of '3', indicating our expectation of meaningful (50%-70%) recovery for lenders in the event of a payment default. We also rated the company's second-priority lien senior secured notes due 2018 a preliminary 'CCC+', with a preliminary recovery rating of '6', indicating negligible (0%-10%) recovery for lenders," S&P stated. The company will use proceeds from the transaction to refinance its existing unrated debt maturing April 2012. "The preliminary 'B' corporate credit rating on Lee reflects our expectation of secular declines in EBITDA, credit measures, and liquidity over the near-to-intermediate term," said Standard & Poor's credit analyst Hal F. Diamond. Under our base case scenario, revenue will decline at a low- to mid-single-digit percent rate and EBITDA will fall at a mid-single-digit percent pace in the fiscal year ending September 2011 due to continuing print advertising revenue declines, only partially offset by a slight reduction in operating expenses," S&P noted. "We also believe that revenues could decline in the mid-single digits in fiscal 2012," added Mr. Diamond, "while EBITDA could fall in the low-double-digit range, as it may be increasingly difficult for the company to realize additional cost reductions." LEHMAN BROTHERS: Committee Backs $809MM Acquisition of Pine Notes ----------------------------------------------------------------- The Official Committee of Unsecured Creditors in Lehman Brothers' cases tells the Bankruptcy Court that it has analyzed independently Lehman Commercial Paper Inc.'s proposed acquisition of the Pine Notes for approximately $809 million. Appreciating the sheer size and significance of the transaction, the Committee says it concurs with the Debtors that the Proposed Transaction is economically favorable to the estates. The Committee says it also agrees with LCPI's decision to maximize value by acquiring 100% control of Pine through an acquisition of all of the Pine Notes owned both by Barclays and LBHI followed by an unwind of the Pine securitization. Accordingly, the Committee supports the Debtors' request and asks the Court to approve the Proposed Transaction. David Walsh filed a supplement to his declaration in support of the Debtors' request. He stated that he has concluded that the purchase price of the Barclays Notes and the LBHI Notes is fair and reasonable, and affords LCPI the opportunity for substantial profit from the cash flows generated by the Underlying Assets. Notes Issued by Pine CCS As reported in the March 29, 2011 edition of the Troubled Company Reporter, Lehman Commercial Paper Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to purchase notes issued by Pine CCS, Ltd. LCPI plans to purchase more than $927 million worth of Class A-1 notes from Barclays Bank PLC, and $4 million worth of Class A-1 notes from Lehman Brothers Holdings Inc. The Barclays notes will be sold for only $805 million, of which a large portion is held by the trustee, U.S. Bank N.A., and by LCPI on behalf of Pine CCS. As of February 28, 2011, about $261 million of the purchase price is held by the trustee. A substantial portion of the purchase price is also held by LCPI as restricted cash on behalf of Pine CCS, which it collected from the commercial loans it participated to the issuer. As of February 28, 2011, the amount was approximately $303 million, which means that LCPI will only have to pay about $241 million out of its unrestricted cash to acquire the Barclays notes, according to court papers. In connection with the acquisition of the Lehman notes, LBHI will also release its security interest in other classes of notes issued by Pine CCS. These include Class A-2 notes, Class B notes and subordinated notes that LBHI acquired pursuant to a collateral disposition agreement with JPMorgan Chase Bank N.A. The Lehman notes were issued after LCPI sold participations in the commercial loans to Pine CCS to increase its liquidity. The notes are secured by the commercial loans. A full-text copy of an agreement governing the note acquisition is available at http://bankrupt.com/misc/LBHI_PineNoteSale.pdf Jacqueline Marcus, Esq., at Weil Gotshal & Manges LLP, in New York, says "considerable value" could be realized by purchasing the Barclays notes given the big discount on the purchase price. The acquisition of notes would also allow LCPI to take control of Pine CCS since the sellers hold a significant position in the capital structure of the issuer. Barclays owns 99.6% of the Class A-1 notes while the rest is owned by LBHI. "Obtaining control over Pine will enable LCPI to terminate the Pine securitization and own the underlying assets free and clear of the interests of any other party," Ms. Marcus says. The lawyer further says maximum value of the commercial loans can only be achieved through active management of those loans but such management is impeded by Pine CCS' ownership of participations in the loans as well as by Barclays' ownership of the notes. 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 Sept. 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. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. 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 Sept. 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 Sept. 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: OKs BNC and Aurora Bank Services Agreement ----------------------------------------------------------- Bankruptcy Judge James Peck issued an order approving an intercompany services agreement between BNC Mortgage LLC and Aurora Bank FSB. BNC Mortgage, an affiliated debtor of Lehman Brothers Holdings Inc., entered into the agreement to ensure Aurora Bank's continued services to the company and to compensate the bank for those services. In an order dated March 31, 2011, Judge Peck authorized BNC Mortgage to pay from the intercompany receivable a sum of $504,455 to Aurora Bank for the services it provided after the company's bankruptcy filing. The receivable is the primary remaining asset of BNC Mortgage and was originated during the winding down of its businesses. It is comprised of amounts that were transferred to Aurora Bank, tax benefits the company accrued prior to the wind down, and other miscellaneous funds. As of January 9, 2009, the amount of the payable was $17,184,322. 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 Sept. 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. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. 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 Sept. 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 Sept. 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: U.S. Bank, et al., Appeal ADR Order ---------------------------------------------------- U.S. Bank National Association and a group of noteholders led by a certain Siu Lui Ching filed with the U.S. District Court for the Southern District of New York a statement of issues in connection with their appeal from a bankruptcy judge's March 3, 2011 order. Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York issued the order authorizing Lehman Brothers Holdings Inc. and its affiliated debtors to implement an alternative dispute resolution process to settle their claims under derivatives contracts with special purpose vehicles. In their statement, U.S. Bank and the noteholders group raised, among other things, the issues of whether or not the Bankruptcy Court erred by: (1) requiring an SPV derivatives counterparty to identify and designate by written notice a person with authority to negotiate all disputed amounts and issues on behalf of the SPV derivatives counterparty, and allow for the imposition of sanctions by the Bankruptcy Court for the failure to designate an authorized designee; (2) requiring an SPV derivatives counterparty or an SPV trustee to incur costs; (3) requiring an SPV derivatives counterparty or an SPV trustee to provide notice to holders of notes or certificates using methods not required or contemplated by relevant governing documents; and (4) failing to require the Debtors to provide the SPV derivatives counterparty and the SPV trustees any information they have or may acquire with respect to the identities of the beneficial holders of notes, certificates or other economic interests in the affected transaction. (5) holding that the noteholders group's objection to the March 3 order was untimely. 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 Sept. 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. Additional units, Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC, sought for bankruptcy protection in December 2009 or more than a year after LBHI and its other affiliates filed their bankruptcy cases. 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 Sept. 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 Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEVEL 3 COMMS: Registers Preferred Shares With NASDAQ ----------------------------------------------------- Level 3 Communications, Inc., registered its preferred stock purchase rights with The NASDAQ Stock Market LLC. The Company entered into a Rights Agreement with Wells Fargo Bank, N.A., as Rights Agent, dated as of April 10, 2011. The Company entered into the Rights Agreement in an effort to deter acquisitions of the Company's common stock that would potentially limit the Company's ability to use its built in losses and any resulting net loss carryforwards to reduce potential future federal income tax obligations. Under the Rights Agreement, from and after the record date of April 21, 2011, each share of Common Stock will carry with it one preferred share purchase right until the Distribution Date or earlier expiration of the Rights. In general terms, the Rights will impose a significant penalty upon any person that, together with all Affiliates and Associates that person, acquires 4.9% or more of the outstanding Common Stock after April 10, 2011. Stockholders that own 4.9% or more of the outstanding Common Stock as of the close of business on April 10, 2011 will not trigger the Rights so long as they do not (i) acquire additional shares of Common Stock representing 0.5% or more of the shares of Common Stock outstanding at the time of such acquisition or (ii) fall under 4.9% ownership of Common Stock and then re-acquire shares that in the aggregate equal 4.9% or more of the Common Stock. A person will not trigger the Rights solely as a result of (a) any transaction that the Board of Directors of the Company determines, in its sole discretion, is an exempt transaction for purposes of triggering the Rights and (b) any acquisition that occurs or may be deemed to occur as a result of entering into the Agreement and Plan of Amalgamation, dated as of April 10, 2011, by and among the Company, Apollo Amalgamation Sub, Ltd., its direct wholly owned subsidiary, and Global Crossing Limited and the transactions contemplated thereby. STT Crossing Ltd. and its Affiliates and Associates will be exempt for the purposes of the Rights Agreement, unless and until STT Crossing Ltd. acquires any Common Stock other than (x) pursuant to the transactions contemplated by the Amalgamation Agreement, (y) in a transaction that is permitted under Section 4 of the Stockholder Rights Agreement, dated as of April 10, 2011, by and among the Company and STT Crossing Ltd. or (z) any transfers of Common Stock or other Company equity interests between STT Crossing Ltd. and its Affiliates. A person to whom STT Crossing Ltd. transfers any amount of Common Stock pursuant to and as permitted by Section 4.3(iii) of the Stockholder Rights Agreement will be exempt for purposes of the Rights Agreement, unless and until such person acquires any additional Common Stock. The Board may, in its sole discretion prior to the Distribution Date, exempt any person or group for purposes of the Rights Agreement if it determines the acquisition by such person or group will not jeopardize the Company's tax benefits or is otherwise in the Company's best interests. Any person that acquires shares of Common Stock in violation of these limitations is known as an "Acquiring Person." The Rights Agreement is not expected to interfere with any merger or other business combination approved by the Board. The Rights From the record date of April 21, 2011, until the Distribution Date or earlier expiration of the Rights, the Rights will trade with, and will be inseparable from, the Common Stock. New Rights will also accompany any new shares of Common Stock that the Company issues after April 21, 2011, until the Distribution Date or earlier expiration of the Rights. Exercise Price Each Right will allow its holder to purchase from the Company one ten-thousandth of a share of Series B Junior Participating Preferred Stock for $9.00, subject to adjustment, once the Rights become exercisable. This portion of a Preferred Share will give the stockholder approximately the same dividend and liquidation rights as would one share of Common Stock. Prior to exercise, the Right does not give its holder any dividend, voting, or liquidation rights. Exercisability The Rights will not be exercisable until 15 business days after the public announcement that a person or group has become an Acquiring Person unless the Rights Agreement has been terminated or the Rights have been redeemed. The date when the Rights become exercisable is the "Distribution Date." Until that date or earlier expiration of the Rights, the Common Stock certificates will also evidence the Rights, and any transfer of shares of Common Stock will constitute a transfer of Rights. After that date, the Rights will separate from the Common Stock and be evidenced by book-entry credits or by Rights certificates that the Company will mail to all eligible holders of Common Stock. Any Rights held by an Acquiring Person, or any Affiliates or Associates of the Acquiring Person, are void and may not be exercised. Consequences of a Person or Group Becoming an Acquiring Person If a person or group becomes an Acquiring Person, all holders of Rights except the Acquiring Person, or any Affiliates or Associates of the Acquiring Person, may, upon payment of the Exercise Price, purchase shares of Common Stock with a market value of twice the Exercise Price, based on the 'current per share market price' of the Common Stock on the date of the acquisition that resulted in such person or group becoming an Acquiring Person. Exchange After a person or group becomes an Acquiring Person, the Board may extinguish the Rights by exchanging one share of Common Stock or an equivalent security for each Right, other than Rights held by the Acquiring Person, or any Affiliates or Associates of the Acquiring Person. Preferred Share Provisions. Each one ten-thousandth of a Preferred Share, if issued: * will not be redeemable. * will entitle its holder to dividends equal to the dividends, if any, paid on one share of Common Stock. * will entitle its holder upon liquidation either to receive $1.00 or an amount equal to the payment made on one share of Common Stock, whichever is greater. * will vote together with the Common Stock as one class on all matters submitted to a vote of stockholders of the Company and will have the same voting power as one share of Common Stock, except as otherwise provided by law. * will entitle holders to a per share payment equal to the payment made on one share of Common Stock, if shares of Common Stock are exchanged via merger, consolidation, or a similar transaction. The value of one ten-thousandth interest in a Preferred Share is expected to approximate the value of one share of Common Stock. Expiration The Rights will expire on the earliest of (i) the day following the third anniversary of the closing of the transactions contemplated by the Amalgamation Agreement, (ii) the time at which the Rights are redeemed, (iii) the time at which the Rights are exchanged, (iv) the time at which the Board determines that the Net Operating Losses of the Company are utilized in all material respects or that an ownership change under Section 382 of the Internal Revenue Code would not adversely impact in any material respect the time period in which the Company could use the NOLs, or materially impair the amount of the NOLs that could be used by the Company in any particular time period, for applicable tax purposes, (v) the first anniversary of the closing of the transactions contemplated by the Amalgamation Agreement if approval of the Rights Agreement by the affirmative vote of the holders of a majority of the voting power of the outstanding Common Stock of the Company has not been obtained prior to such date, (vi) the termination of the Amalgamation Agreement or (vii) a determination by the Board, prior to the Distribution Date, that the Rights Agreement and the Rights are no longer in the best interests of the Company and its stockholders. Redemption The Board may redeem the Rights for $0.0001 per Right at any time before the Distribution Date. If the Board redeems any Rights, it must redeem all of the Rights. Once the Rights are redeemed, the only right of the holders of Rights will be to receive the redemption price of $0.0001 per Right. The redemption price will be adjusted if the Company has a stock split or stock dividends of its Common Stock. Anti-Dilution Provisions The Board may adjust the Exercise Price, the number of Preferred Shares issuable and the number of outstanding Rights to prevent dilution that may occur from a stock dividend, a stock split, or a reclassification of the Preferred Shares or Common Stock. Amendments The terms of the Rights Agreement may be amended by the Board without the consent of the holders of the Rights. After the Distribution Date, the Board may not amend the agreement in a way that adversely affects holders of the Rights. About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. The Company's balance sheet at Dec. 31, 2010, showed $8.35 billion in total assets, $8.51 billion in total liabilities and a $157 million stockholders' deficit. Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. LEVEL 3 COMMS: Adopts Rights Plan Designed to Protect NOLs ---------------------------------------------------------- Level 3 Communications, Inc., has adopted a Stockholder Rights Plan. The Rights Plan is designed to protect the company's federal Net Operating Losses (NOLs) from the effect of Internal Revenue Code (IRC) Section 382, which can restrict the use of NOLs. As of Dec. 31, 2010, the company had a NOL carry forward for federal tax purposes of approximately $5.9 billion. The company's ability to use its NOLs can be negatively affected if there is an "ownership change" as defined under IRC Section 382. In general, this would occur if certain ownership changes related to the company's stock that is held by five percent or greater stockholders exceed 50 percent, measured over a rolling three-year period. The completion of the company's pending business combination transaction with Global Crossing Limited would move the company significantly closer to the 50 percent ownership change and increase the likelihood of a loss of the company's valuable NOLs. The purpose of the Rights Plan is to deter trading that would result in an ownership change and to protect the company's ability to use its NOLs in the future, in order to prevent the reduction in stockholder value that would result from the loss of the NOLs. The Rights Plan was not adopted as an anti- takeover measure, and if the Global Crossing transaction is not completed, the Rights Plan would expire. The Rights Plan will be limited in life, and the rights will expire upon the earliest of (1) the day following the third anniversary of the closing of the Global Crossing transaction, if stockholder approval of the Rights Plan is obtained; (2) the first anniversary of the closing of the Global Crossing transaction, if stockholder approval of the Rights Plan is not obtained by that date; (3) the termination of the Amalgamation Agreement governing the Global Crossing transaction; (4) the determination by the company's Board of Directors that the NOLs are utilized in all material respects or that an ownership change under IRC Section 382 would not adversely effect in any material respect the time period in which the company could use the NOLs, or materially impair the amount of the NOLs that could be used by the company in any particular time period; or (5) certain other events described in the Rights Plan, including if the company's Board of Directors determines that expiration is in the company's best interest. Under the Rights Plan, one right will be distributed for each share of the company's common stock outstanding as of the close of business on April 21, 2011. Pursuant to the Rights Plan, when a person or group has obtained beneficial ownership of 4.9 percent or more of the company's common stock outstanding at the time of such acquisition, or an existing holder with greater than 4.9 percent ownership acquires more shares representing at least an additional 0.5 percent of the company's common stock outstanding at the time of such acquisition, there would be a triggering event causing significant dilution in the economic interest and voting power of that person or group. The company's Board of Directors has the discretion to exempt any person or group for purposes of the Rights Plan if it determines the acquisition by that person or group will not jeopardize tax benefits or is otherwise in the company's best interests. In addition, acquisitions of company shares as a result of the closing of the Global Crossing transaction, and certain transfers following the closing by STT Crossing Ltd., a wholly owned subsidiary of Singapore Technologies Telemedia and the controlling stockholder of Global Crossing, including pursuant to the Stockholder Rights Agreement that the company has entered with STT Crossing Ltd. in connection with the Global Crossing transaction, have been exempted from triggering the provisions of the Rights Plan. About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. The Company's balance sheet at Dec. 31, 2010, showed $8.35 billion in total assets, $8.51 billion in total liabilities and a $157 million stockholders' deficit. Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. LITHIUM TECHNOLOGY: Lim Kee Discloses 67.7% Equity Stake -------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission, Lim Ho Kee and his affiliates disclosed that they beneficially own 2,176,212,293 shares of common stock of Lithium Technology Corporation representing 67.7% of the shares outstanding. Lim Ho Kee is the sole shareholder of Power Duke Investments Limited. On Oct. 22, 2010, the Company entered into a Stock Purchase Agreement with Power Duke, pursuant to which the Company issued 83,333,333 shares of Common Stock to Power Duke. A full-text copy of the filing is available for free at: http://is.gd/diYVKp About Lithium Technology Plymouth Meeting, Pa.-based Lithium Technology Corporation is a mid-volume production stage company that develops large format lithium-ion rechargeable batteries to be used as a new power source for emerging applications in the automotive, stationary power, and national security markets. The Company reported a net loss of $7.25 million on $6.35 million of products and services sales for the year ended Dec. 31, 2010, compared with a net loss of $10.51 million on $7.37 million of product and services sales during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $10.78 million in total assets, $34.16 million in total liabilities and $23.38 million in total stockholders' deficit. Amper, Politziner & Mattia, LLP, Edison, New Jersey, noted that the Company has recurring losses from operations since inception and has a working capital deficiency that raise substantial doubt about its ability to continue as a going concern. $7 Mil. Funding Needed As reported by the TCR on April 8, 2011, the Company entered into a number of financing transactions and is continuing to seek other financing initiatives. The Company said it will need to raise additional capital to meet its working capital needs and to complete its product commercialization process. Such capital is expected to come from the sale of securities and debt financing. The Company believes that if it raises approximately $7 million in debt and equity financings, the Company would have sufficient funds to meet its needs for working capital and capital expenditures and to meet expansion plans during 2011. If the Company is not able to raise such additional capital, the Company will assess all available alternatives including a sale of the Company's assets or merger, the suspension of operations and possibly liquidation, auction, bankruptcy, or other measures. LIZ CLAIBORNE: S&P Raises Corp. Credit Rating to 'B-' From 'SD' --------------------------------------------------------------- Standard & Poor's Ratings Services said it raised its corporate credit rating on New York City-based Liz Claiborne Inc. to 'B-' from 'SD'. "We also raised our ratings on Liz Claiborne's remaining 5% euro notes (not tendered) to 'CCC' from 'D'. The recovery rating on this debt remains unchanged at '6'," S&P related. "At the same time, we affirmed the 'B-' issue-level rating on Liz Claiborne's $220 million 10.5% senior secured notes due 2019. The recovery rating remains at '3', indicating our expectation for meaningful (50% to 70%) recovery in the event of a payment default. We also affirmed the 'CCC' issue level rating on Liz Claiborne's 6% convertible notes due 2014. The recovery rating remains at '6', indicating our expectation for negligible (0% to 10%) recovery in the event of a payment default," S&P stated. "These rating actions follow the completion of the company's recent tender offer and associated financing, in which EUR128.5 million of its EUR350 million 5% notes due 2013 were retired and $220 million of new 10.5% senior secured notes due 2019 were issued, and our subsequent reassessment of Liz Claiborne's credit risk," S&P noted. "Our ratings on Liz Claiborne reflect its poor operating performance, its thin credit metrics, and our expectation that weak consumer spending will hamper its ability to materially improve its operating performance over the next 12 months, but that the company will have adequate liquidity over the near term," said Standard & Poor's credit analyst Jeffrey Burian. "The rating outlook is negative, reflecting the company's leverage, which remains very high, and operating performance which, although slightly improving, remains below our prior expectations," S&P added. LOTHIAN OIL: Bankruptcy Court Enters Show Cause Order ----------------------------------------------------- At the behest of Lothian Oil Inc. and its debtor-affiliates, Chief Bankruptcy Judge Ronald B. King directed several entities to appear before the Bankruptcy Court on April 26, 2011, at 9:30 o'clock a.m., and show cause why they should not be held in contempt of a Final Contempt Judgment entered by the Court on July 15, 2010, and subject to the additional sanctions and penalties set forth. The entities are: (i) attorney Jessica Sokol, (ii) Israel Grossman, and (iii) Ms. Sokol's clients, Zalman Anderson, Jan Arnett, Albert Balakhane, Edmond Balakhane, Lawrence Clark, Brenda Crayk, Jacob and Miriam Dekelbaum, Azriel Horowitz, Charles Soltz, Daniel and M. Zucker, Akberali Khakee Pension Plan, Anna Meisher Pension Plan, Feinberg Family Trust, Herzberg Family Trust, Hirshberg Family Trust, JG Trust, Listokin Trust, Lothian Cassidy, LLC, Moses Family Trust, MYG Trust, Pension Solutions, S. Pollak Audiological P.C. Profit Sharing Plan, Shorivger Trust, Shoshana Trust, Spitzer Family Trust, YG Trust, YS Trust, YYSD Trust, and 731 895 866 LLC. On July 15, 2010, the Court entered its Final Contempt Judgment and Final Contempt Judgment Findings of Fact and Conclusions of Law. Under the Final Contempt Judgment, the Respondents are subject to a $10,000 sanction for each action taken or pleading filed in furtherance of the lawsuit currently pending in the Court as Adversary Proceeding No. 10-7011-RBK, with the sanctions payable to the Court. Under the Final Contempt Judgment, the Reorganized Debtors may recover from the Respondents the reasonable and necessary attorneys' fees incurred in defending, responding to, or otherwise addressing Respondents' post-Final Contempt Judgment actions in furtherance of the New York Lawsuit. From July 20, 2010 through October 8, 2011, the Respondents filed eight pleadings and other documents in the United States District Court for the Eastern District of New York in furtherance of the New York Lawsuit and in violation of the Final Contempt Judgment. From July 20, 2010 through December 13, 2010, Respondents filed 32 pleadings and other documents in the United States Court of Appeals for the Second Circuit in furtherance of the New York Lawsuit and in violation of the Final Contempt Judgment. A copy of the Court's April 6, 2011 Order to Appear and Show Cause is available at http://is.gd/QkU5lufrom Leagle.com. About Lothian Oil Based in Midland, Texas, Lothian Oil Inc. is a privately owned oil and gas company. Lothian and six affiliates filed for chapter 11 protection on June 13, 2007 (Bankr. W.D. Tex. Case No. 07-70121). When Lothian sought bankruptcy, it listed assets and debts between $1 million to $100 million. The Reorganized Debtors are represented by: Marty L. Brimmage, Jr. Eric Terry, Esq. Abigail Ottmers, Esq. Charles A. Beckham, Jr., Esq. HAYNES AND BOONE, LLP, E-mail: marty.brimmage@haynesboone.com. eric.terry@haynesboone.com abigail.ottmers@haynesboone.com. charles.beckham@haynesboone.com LOTT SURPLUS: Bank's Suit v. Insurer Stays in Bankruptcy Court -------------------------------------------------------------- Bankruptcy Judge Letitia Z. Paul denied the request by Amerisure Mutual Insurance Company (i) to withdraw Bankruptcy Court reference of the suit, Texas First Bank, v. Amerisure Mutual Insurance Company, Adv. Pro. No. 10-3617 (Bankr. S.D. Tex.), and (ii) for dismissal of the complaint. Prior to the filing of bankruptcy, Amerisure provided workers compensation coverage and automobile insurance coverage to Lott. Amerisure required the Debtor to provide it with a letter of credit to secure the Debtor's additional premium and loss reimbursement obligations to Amerisure. The Debtor provided Amerisure with a letter of credit issued by Texas First Bank and listing Amerisure as the beneficiary. The purpose of the letter of credit was to assure Amerisure that the Debtor would have funds available in the event of stop losses under Debtor's Master Premium Agreement for the automobile and workers compensation policies. On Jan. 21, 2010, the Debtor executed a promissory note, in the same amount as the letter of credit, and a security agreement granting a first lien to Texas First Bank in certain equipment. The Debtor's principal, Robert Lott, also executed a personal guaranty. These loan documents were executed to secure repayment if Texas First Bank was required to pay Amerisure under the letter of credit. On Oct. 26, 2010, Amerisure made demand on Texas First Bank for the full amount of the letter of credit. Texas First Bank did not comply and filed the adversary proceeding against Amerisure for declaratory judgment as to Texas First Bank's rights and obligations under the letter of credit. Amerisure filed a motion to dismiss on the basis of lack of subject matter jurisdiction and a motion requesting that the reference of the adversary proceeding be withdrawn. Although Amerisure has not yet filed an Answer to the Complaint, Amerisure alleges that it intends to assert equitable or legal counter claims and cross-claims, and to exercise its Seventh Amendment right to a jury trial. Amerisure also alleges that it does not consent to a final determination and entry of final judgment in this case by the Bankruptcy Court. A copy of Judge Paul's April 6, 2011 Memorandum Opinion is available at http://is.gd/AkfAAefrom Leagle.com. Lott Surplus Materials, Inc., dba Lott Contractors, in Hamshire, Texas, is in the business of construction, repair, and maintenance of pipelines and compressor stations in Texas and Louisiana. Lott Surplus Materials filed a voluntary Chapter 11 petition (Bankr. S.D. Tex. No. 10-39477) on Oct. 22, 2010. Ronald J. Sommers, Esq. -- efilers@nathansommers.com -- at Nathan Sommers Jacobs, serves as bankruptcy counsel. The Debtor's petition disclosed $1 million to $10 million in assets and $10 million to $50 million in debts. MARITIME TELECOMMUNICATIONS: S&P Puts 'B' Corporate Credit Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B' corporate credit rating to Miramar, Fla.-based satellite services provider Maritime Telecommunications Network Inc. (MTN). The outlook is stable. "At the same time, we assigned a 'B+' issue-level rating and '2' recovery rating to the company's $110 million senior secured term loan and $10 million revolver. The '2' recovery rating indicates our expectation of substantial (70% to 90%) recovery in the event of payment default," S&P stated. The company intends to use the proceeds from the term loan to repay about $84 million of outstanding debt, pay a $20 million distribution to shareholders, add $1 million of cash to the balance sheet, and pay related fees and expenses. "The ratings we are assigning are final and follow the closing of the financing on March 4, 2011," S&P noted. "The ratings on MTN reflect its narrow scope of business, revenue concentration among large customers with significant pricing power, uncertain growth prospects from new business lines, and a highly leveraged financial risk profile," said Standard & Poor's credit analyst Allyn Arden, "including elevated pro forma operating lease-adjusted leverage of about 6.3x." Tempering factors include the company's leading niche position in providing communications services to the North American cruise industry, its stability from long-term contractual revenue, and its solid net free cash flow generation. MARKET CENTER: Special Counsel Awarded 1/4 of Requested Fees ------------------------------------------------------------ WestLaw reports that the services provided by special counsel for a Chapter 11 debtor, which led to the successful settlement of the debtor's prepetition litigation against the purchaser of the debtor's real property, provided a benefit to the bankruptcy estate, as required for special counsel's entitlement to compensation under the Bankruptcy Code's administrative expense statute. Although the debtor contended that the efforts of its attorney and the real estate agent involved in the original sale transaction resulted in the bulk of the large settlement, the bankruptcy court concluded that it was the efforts of special counsel, including its settlement negotiations, that led to the $9,750,000 recovery for the estate. The court also rejected the debtor's contention that, rather than obtaining a benefit for the estate, special counsel's efforts resulted in an almost $4,000,000 loss, based on the difference between the settlement obtained and the original purchase price for the debtor's property. In re Market Center East Retail Property, Inc., --- B.R. ----, 2011 WL 1204754 (Bankr. D. N.M.). A copy of the Honorable James S. Starzynski's Memorandum Opinion dated Mar. 30, 2011, awarding $350,000 of $1.4 million requested to Barak Lurie, Esq., and Lurie & Park, is available at http://is.gd/Ga25Wpfrom Leagle.com. Market Center East Retail Property, Inc., is a limited liability company that has operated a retail commercial shopping center in Albuquerque, New Mexico since 2006. It acquired the property by purchase from a former owner in 2006 by assuming that owner's obligations under various loan documents and by executing new guaranties. Danny Lahave is the 100% owner of the Debtor and its sole officer. Market Center sought Chapter 11 bankruptcy protection (Bankr. D. N.M. Case No. 09-11696) on April 22, 2009, as a single asset real estate debtor. The Company is represented by Daniel J. Behles, Esq., at Cuddy & McCarthy, LLP. At the time of the filing, the Debtor estimated its assets and debts at less than $10 million. The Debtor filed a Chapter 11 Plan on June 16 or 17, 2009, and filed an Amended Chapter 11 Plan on August 30, 2009. MCCLURE PROPERTIES: Court Rules on Suit vs. Fifth Third Bank ------------------------------------------------------------ McClure Properties, Inc., filed a two count adversary complaint against Fifth Third Bank and William T. Holmes. Count I seeks to set aside a trustee's foreclosure sale, conducted by Mr. Holmes, on the grounds that the foreclosure sale price was so low as to shock the conscience. Count II of the complaint seeks to avoid the foreclosure sale as being a fraudulent transfer under West Virginia law, W. Va. Code Sec. 40-1A-4(a). The Bank requests entry of a judgment on the pleadings on both counts of the Debtor's complaint. The Bank asserts that both counts should be dismissed on the grounds that the causes of action are subject to claim preclusion, the price received at a regularly conducted foreclosure sale cannot be fraudulent, and the claims against it are time-barred under the applicable statute of limitations. Bankruptcy Judge Patrick M. Flatley dismissed Count II of the Debtor's complaint asserting a cause of action under W. Va. Code Sec. 40-1A-4(a), but denied the remaining relief sought by the Bank. The case is McClure Properties, Inc., v. Fifth Third Bank, C2C Realty, LLC, and William T. Holmes, Successor Trustee, Adv. Pro. No. 10-146 (Bankr. N.D. W.Va.). A copy of the Court's April 4, 2011 Memorandum Opinion is available at http://is.gd/MCyS1ifrom Leagle.com. McClure Properties, Inc., filed for Chapter 11 bankruptcy (Bankr. N.D. W.Va. Case No. 10-1810) on July 26, 2010. MEDICAL PROPERTIES: S&P Puts 'BB' Rating on Proposed $450MM Notes ----------------------------------------------------------------- Standard & Poor's Ratings Services raised its rating on Birmingham, Ala.-based Medical Properties Trust Inc. and its subsidiary, MPT Operating Partnership L.P., to 'BB' from 'BB-'. "At the same time, we assigned our 'BB' issue rating and our '4' recovery rating to the partnership's proposed $450 million senior unsecured notes due 2021. The outlook is stable," S&P stated. "We upgraded Medical Properties to acknowledge the REIT's improved financial risk profile, which we now view to be intermediate," said credit analyst James Fielding. "A successful recapitalization in 2010 provided capacity for the REIT's recent unsecured debt transactions that will provide capital for potentially accretive acquisitions. Additional growth could eventually bolster a business risk profile that we continue to view as fair, largely because of Medical Properties' meaningful tenant and geographic concentration." "Our stable outlook reflects our expectation that stable core cash flows in 2011 will support moderately higher overall debt levels. We would raise our rating one notch if Medical Properties continues to diversify its tenant base while maintaining leverage near 5.0x EBITDA and that accretive investments eventually support coverage of all fixed charges including common dividends of close to 1.1x. We would lower our rating by one notch if one of the company's top three tenants default and/or debt rises more than expected such that debt-to-EBITDA approaches 9.0x," S&P related. MESA AIR: Has Stipulation With Suntrust on Assumption Issues ------------------------------------------------------------ Reorganized Mesa Air Group, Inc. and its affiliated debtors and liquidating debtors and Suntrust Leasing Corporation have entered into a stipulation and order regarding assumption obligations with respect to certain aircraft leases. Suntrust have filed (i) Claim Nos. 770 and 772 against Mesa Air Group, and (ii) Claim Nos. 771 and 784 against Mesa Airlines, Inc. On December 28, 2010, the Debtors filed a Plan Supplement to their Second Amended Joint Plan of Reorganization, dated November 23, 2010. On January 7, 2011, Suntrust filed an objection to the proposed assumption obligations with respect to certain aircraft leases. On January 19, 2011, the Debtors filed their Third Amended Joint Plan of Reorganization and an Amended Plan Supplement to their Plan. Pursuant to the Amended Plan Supplement, the Debtors proposed to assume two leases between Mesa Airlines and Suntrust, as owner participant, relating to aircraft with FAA Registration Numbers N521LR and N522LR. The Amended Plan Supplement provided that the Assumption Obligations related to the assumption of the Aircraft Leases are $0. The Third Amended Plan was confirmed on January 20, 2011, and became effective on March 1, 2011. The parties stipulate that: * Notwithstanding anything to the contrary in the Amended Plan Supplement, the Assumption Obligations in connection with the assumption of the Aircraft Leases are $40,000. * Mesa Airlines assumes the Aircraft Leases pursuant to Section 365(a) of the Bankruptcy Code. * Upon entry by the Bankruptcy Court of the stipulation and order -- the date of which is the Assumption Effective Date -- Mesa Airlines will immediately pay Suntrust $40,000 to cure all defaults existing as the Assumption Effective Date under the Aircraft Leases pursuant to Section 365(b) of the Bankruptcy Code. * Suntrust's Objection is deemed withdrawn. * Suntrust's Claims are deemed withdrawn. Judge Martin Glenn approved the stipulation on April 7, 2011. About Mesa Air Mesa Air currently operates 76 aircraft with approximately 450 daily system departures to 94 cities, 38 states, the District of Columbia, and Mexico. Mesa operates as US Airways Express and United Express under contractual agreements with US Airways and United Airlines, respectively, and independently as go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company was founded by Larry and Janie Risley in New Mexico in 1982. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), disclosing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on January 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Mesa Air's Plan of Reorganization became effective March 1, 2011. The Company's restructuring accomplishments included elimination of 100 excess aircraft and associated leases and debt which contributed to the deleveraging of Mesa's balance sheet in the approximate amount of $700 million in capitalized leases and $50 million in debt, and extending the term of the code-share agreement with US Airways through September 2015. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MESA AIR: Assumes Zurich Surety Bonds and Indemnity Agreements -------------------------------------------------------------- On March 21, 2011, Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York approved the stipulation entered into by Mesa Air Group, Inc., and its affiliated debtors, on the one hand, and Zurich American Insurance Company, its subsidiaries and affiliates, including Fidelity and Deposit of Maryland, Colonial American Casualty and Surety Co., and American Guarantee and Liability Co., on the other hand, with respect to certain surety bonds and claims. Among other things, the Debtors and Zurich have agreed that (i) the Debtors will assume the surety bonds and the related indemnity agreements; (ii) a payment of $18,027 by the Debtors to Zurich will cure all defaults existing under the Surety Bonds and Indemnity Agreements; (iii) the Debtors have provided adequate assurance of future performance under the Surety Bonds and Indemnity Agreements; and (iv) the Zurich Proofs of Claim will be disallowed. The Surety Bonds and Indemnity Agreements are deemed assumed. The Zurich Proofs of Claim are Claim Nos. 23, 24, 25, 1349, 1350, 1351, 1493, 1494, and 1495. A schedule of the Surety Bonds and Indemnity Agreements is available at no charge at: http://bankrupt.com/misc/Mesa_OrdStipZurichBonds032111.pdf About Mesa Air Mesa Air currently operates 76 aircraft with approximately 450 daily system departures to 94 cities, 38 states, the District of Columbia, and Mexico. Mesa operates as US Airways Express and United Express under contractual agreements with US Airways and United Airlines, respectively, and independently as go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company was founded by Larry and Janie Risley in New Mexico in 1982. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), disclosing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on January 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Mesa Air's Plan of Reorganization became effective March 1, 2011. The Company's restructuring accomplishments included elimination of 100 excess aircraft and associated leases and debt which contributed to the deleveraging of Mesa's balance sheet in the approximate amount of $700 million in capitalized leases and $50 million in debt, and extending the term of the code-share agreement with US Airways through September 2015. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MESA AIR: Resolves Bombardier Administrative Claims --------------------------------------------------- Mesa Air Group and its affiliates received approval from the Bankruptcy Court of a settlement agreement with (i) Bombardier Services Corporation and (ii) Bombardier Capital Inc. to resolve issues that are or may be raised with respect to the amounts of certain administrative claims asserted by Bombardier. Before the Petition Date, Mesa Airlines, Inc., leased from various owner trustees two Canadian Regional Jet CL-600-2B19 in which BCI was the Loan Participant and Controlling Party that financed the owner trustees' purchase of the CRJ 200 aircraft. Mesa Airlines also leased from BSC two CRJ 200 aircraft. Mesa Air Group, Inc. guaranteed Mesa Airlines' obligations under the BCI Leases and the BSC Leases. On March 4, 2010, the Debtors filed a notice electing to perform their obligations under one of the BCI Leases. On March 9, 2010, the parties entered into a stipulation pursuant to Section 1110(b) of the Bankruptcy Code to extend the 60-day period set for in Section 1110(a)(2) of the Bankruptcy Code and to establish the terms and conditions for the Debtors' postpetition use, surrender and return of the CRJ 200 aircraft leased by Bombardier upon the Debtors' rejection of the BSC Leases. The Debtors subsequently rejected the BCI Leases and the BSC Leases pursuant to the Court's February 23, 2010 rejection Procedures Order. The Court's March 26, 2010 Bar Date Order established May 21, 2010 as the deadline to file proofs of claim by all creditors other than governmental units against the Debtors. Bombardier filed certain claims asserting administrative claims against Mesa Airlines on account of purported breaches of the Section 1110 Agreement in connection with the rejection of the BCI Leases and BSC Leases. Claim No. Amount --------- ------ 1428 $750,000 1446 $1,443,797 1453 $1,648,554 The salient terms of the settlement agreement include: (a) The liquidated amount of the Asserted Administrative Claims will be reduced to and allowed in the aggregate amount of $321,000. The Allowed Administrative Claim will not be subject to any further objection by any party-in- interest. Mesa Airlines will pay the Allowed Administrative Claim to Bombardier by wire transfer in immediately available funds. (b) Upon the Court's approval of the settlement agreement, the Debtors' claims agent is directed to modify Claim No. 1453 and to expunge Claim Nos. 1428 and 1446, and any other administrative expense claims filed by Bombardier related to the Aircraft Leases that have not otherwise been allowed pursuant to separate order of the Court. (c) Each party will be responsible for costs and expenses it incurred in negotiating, drafting, and executing the settlement agreement. The settlement agreement will not have any effect upon the allowance of the BSC/BCI General Unsecured Claims pursuant to the BSC/BCI General Unsecured Claims Allowance Order. The general unsecured claims of Bombardier arising from the rejection of the BSC Leases and the BCI Leases, in addition to the resolution of other general unsecured claims, were resolved and allowed pursuant to the Order Authorizing Debtors to (I) Assume Master Purchase Agreement, as Amended, with Bombardier, Inc., (II) Settle Certain Claims Between the Debtors and Bombardier Inc. Arising Under the Master Purchase Agreement, and (III) Settle Certain Claims Asserted Against the Debtors by Bombardier Capital Inc. and Bombardier Service Corporation. About Mesa Air Mesa Air currently operates 76 aircraft with approximately 450 daily system departures to 94 cities, 38 states, the District of Columbia, and Mexico. Mesa operates as US Airways Express and United Express under contractual agreements with US Airways and United Airlines, respectively, and independently as go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company was founded by Larry and Janie Risley in New Mexico in 1982. Mesa Air Group Inc. and its units filed their Chapter 11 petitions Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), disclosing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on January 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Mesa Air's Plan of Reorganization became effective March 1, 2011. The Company's restructuring accomplishments included elimination of 100 excess aircraft and associated leases and debt which contributed to the deleveraging of Mesa's balance sheet in the approximate amount of $700 million in capitalized leases and $50 million in debt, and extending the term of the code-share agreement with US Airways through September 2015. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MICHAEL KIRKBRIDE: Court Rules on Contractor's Lawsuit ------------------------------------------------------ During the period of time between February 2004 through January 2005, Michael Lynn Kirkbride and Dolores Avoline Kirkbride entered into agreements with Alan Votta Construction, Inc., for the construction, sale, and purchase of residential homes in the towns of Kure Beach and Carolina Beach, North Carolina. The nature of the agreements entailed Alan Votta purchasing land and constructing residential homes. When certificates of occupancy were issued, the Kirkbrides would obtain financing to purchase the homes from Alan Votta as development property, intending to resell the properties. In total there were agreements for the construction, sale, and purchase of six single-family homes. In April 2006, the Kirkbrides learned they could not obtain the requisite financing to purchase these homes from Alan Votta for two reasons: 1) they concurrently owned too many other properties, and 2) there were insufficient reserves. After learning of the Kirkbrides' inability to obtain financing, Alan Votta listed the three properties for sale. Two of the three properties were sold to third party purchasers for less than the original purchase agreement price. The Kirkbrides filed for relief under chapter 11 of the Bankruptcy Code on January 8, 2008. Alan Votta sued the Kirkbrides in state court in June 2007. After responsive pleadings and counterclaims were filed, each party asserted the other had breached the three disputed contracts. After the filing of the Kirkbrides' bankruptcy petition, the parties brought the litigation into the Bankruptcy Court's jurisdiction as an adversary proceeding to which the Kirkbrides filed a motion for summary judgment. On Aug. 13, 2009, the bankruptcy court found that the disputed contracts were each subject to the condition precedent that the Kirkbrides acquire financing to purchase the properties after using their best efforts to secure loans. The bankruptcy court also found that the Kirkbrides had used their best efforts to obtain financing, but were unable to do so. As a result of the failed condition, the contract was found to be unenforceable, entitling the Kirkbrides to the return of their deposits. On appeal, the district court affirmed the bankruptcy court's findings as to the Kirbrides' reasonable efforts to obtain financing. However, the district court found that based on the language in the contracts, there was a genuine issue of material fact as to whether the deposits were earnest money deposits that were refundable in light of the unfulfilled condition precedent or whether the deposits became non-refundable after a certain date. In his April 7, 2011 Order, Bankruptcy Judge J. Rich Leonard held that at the summary judgment phase, the issue of whether the deposits were refundable was a genuine one of material fact, as found by the district court. "However, after trying the issue on remand, the Court finds the terms of the contract are unambiguous and thus not open to interpretation based on extrinsic evidence. As such, the contracts dictate that the deposits, totaling $105,000.00, must be refunded to defendants Michael and Dolores Kirkbride," Judge Leonard said. The suit is Alan Votta Construction, Inc., v. Michael L. Kirkbride and Dolores A. Kirkbride, Adv. Pro. No. 08-00211 (Bankr. E.D.N.C.). A copy of his decision is available at http://is.gd/M5boa2from Leagle.com. MOON THAI: Court Suspends Brown Van Horn's Bankruptcy Practice -------------------------------------------------------------- Bankruptcy Judge John K. Olson issued an order prohibiting David Marshall Brown, Chad T. Van Horn, and Hollie F. Kirsner, and all other Brown, Van Horn, P.A., attorneys who were employed by the firm on April 1, 2011, from filing any debtor cases under any Chapter of the Bankruptcy Code in any Bankruptcy Court in the United States, effective immediately, pending further Court order. The Court previously entered an Order to Show Cause directing the Brown Van Horn attorneys to appear on March 22, 2011, and show cause why they should not be suspended from the practice of law before the Court. The show cause hearing was continued April 1, 2011, directing the law firm to employ one skilled Chapter 13 practitioner and one skilled Chapter 11 practitioner with impeccable reputations to study the firm's Chapter 13 and Chapter 11 practices, make recommendations, and report to the Court when they had completed their analysis. The two lawyers retained by Brown, Van Horn, John D. Bristol (as to Chapter 13 matters) and Frank P. Terzo (as to Chapter 11 matters) gave preliminary findings at the April 1 hearing. The Order to Show Cause was precipitated by what appeared to be incompetent and wrongful conduct by the lawyers in the firm in the Chapter 11 case of Moon Thai & Japanese, Inc., and in other cases filed under Chapter 11 and Chapter 13. The Court also directed Brown Van Horn to return certain fees. A copy of the Court's April 8, 2011 Order is available at http://is.gd/Qgbpzsfrom Leagle.com. Moon Thai & Japanese, Inc., and its affiliates filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 10-23328) on May 14, 2010. NATIONAL CONSUMER: Court Denies Rio's Motion for Sanctions ---------------------------------------------------------- Magistrate Judge Peggy A. Leen denied Rio Properties, Inc.'s Motion for Sanctions Due to Spoliation of Evidence filed in the suit, John P. Brincko, v. Rio Properties, Inc., Case No. 2:10-cv- 00930-PMP-PAL (D. Nev.). Mr. Brincko is the Chapter 11 Trustee in National Consumer Mortgage, LLC's bankruptcy case. A copy of the Court's March 30, 2011 Order is available at http://is.gd/lAqpIg from Leagle.com. Headquartered in Orange, California, National Consumer Mortgage LLC -- http://www.nationalconsumermortgage.com/-- is an independent mortgage brokerage that creates and processes home loans. The Debtor filed for chapter 11 protection on Apr. 3, 2006 (Bankr. C.D. Calif. Case No. 06-10429). Lorraine L. Loder, in Los Angeles, California, represents the Debtor. David L. Neale, Esq., at Levene, Neale, Bender, Rankin & Brill L.L.P., represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it listed total assets of $1,102,135 and total debts of $32,846,858. On June 22, 2006, John P. Brinco was appointed as the Debtor's Chapter 11 Trustee. He is represented by the lawyers at Baker & McKenzie LLP. NEW CENTURY FIN'L: Court Rejects Muhammad Admin. Claim ------------------------------------------------------ Bankruptcy Judge Kevin J. Carey sustained the objection by The New Century Liquidating Trust to the request for payment of administrative expenses filed by Cedric Muhammad. Mr. Muhammad's claim for an administrative expense or a general unsecured claim is disallowed. The Objection sought to (i) disallow and expunge the Claim as an invalid administrative claim; or in the alternative, (ii) reclassify the Claim as a general unsecured claim, and (iii) disallow and expunge the reclassified general unsecured claim, because it was filed after the claims bar date. Judge Carey said Mr. Muhammad's Claim is not an administrative expense of the estate. Even if the Claim is considered a general unsecured claim, it is disallowed since it was not timely filed and Mr. Muhammad has neither alleged nor proven facts sufficient to support a valid claim. Mr. Muhammad asserts a claim for $2,500,000 against the Debtors based on the decisions and actions taken in connection with a pre- bankruptcy loan from New Century Mortgage Corporation. The Claim asserts that the Debtors deliberately defrauded Mr. Muhammad and caused damages to Mr. Muhammad and his family. A copy of the Court's April 11, 2011 Order is available at http://is.gd/RdOAlWfrom Leagle.com. About New Century Financial Founded in 1995, Irvine, Calif.-based New Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/-- was a real state investment trust, providing mortgage products to borrowers nationwide through its operating subsidiaries, New Century Mortgage Corporation and Home123 Corporation. The Company offered a broad range of mortgage products designed to meet the needs of all borrowers. New Century Financial and its affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 07-10416) on April 2, 2007. Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins, Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., were tapped as bankruptcy counsel. The Official Committee of Unsecured Creditors selected Hahn & Hessen as its bankruptcy counsel and Blank Rome LLP as its co-counsel. When the Debtors filed for bankruptcy, they listed total assets of $36,276,815 and total debts of $102,503,950. The Court confirmed the Debtors' second amended joint Chapter 11 plan of liquidation on July 15, 2008. The Plan became effective on Aug. 1, 2008, creating the New Century Liquidating Trust and appointing Alan M. Jacobs as Liquidating Trustee of New Century Liquidating Trust and Plan Administrator of New Century Warehouse Corporation. NEW RIVER: Court Denies Creditor's Motion for Sanctions ------------------------------------------------------- On Nov. 2, 2010, Kevin Gleason, counsel for Christopher Denison, filed a Claim of Exemption and Notice of Hearing in the bankruptcy case of New River Dry Dock, Inc. The Claim asserted that Mr. Denison could exempt commissions he had received from a real estate sale. Mr. Denison had already admitted he owed those commissions to the Plan Administrator under the Debtor's confirmed Chapter 11 Plan. Bankruptcy Judge John K. Olson previously ordered those funds to be sequestered and disbursed to the Plan Administrator. On Nov. 3, 2010, Marina Mile Shipyard, Inc., filed a Motion to Strike Denison's Claim of Exemption and Notice of Hearing. MMS gave Mr. Denison's counsel, Kevin C. Gleason an opportunity to withdraw or otherwise amend the Claim before filing a motion for sanctions against him. MMS filed the Motion for Sanctions on Nov. 29, 2010. When MMS filed the Motion for Sanctions Mr. Gleason had not withdrawn or otherwise amended the Claim. On Dec. 6, 2010, Mr. Gleason and MMS entered into an agreed order to strike the Claim. During a Jan. 4, 2011 hearing, Mr. Gleason argued that MMS could not pursue sanctions against him because MMS did not provide him 21 days to withdraw or otherwise amend the Claim before it filed its Motion for Sanctions. Because Mr. Gleason is correct in his counting of days under Federal Rule of Bankruptcy Procedure 9011, the sanctions motion will be denied. In his March 31, 2011 Order, Judge Olson said MMS jumped the gun and filed its Motion for Sanctions prematurely. Judge Olson explained that Mr. Gleason had essentially conceded the Claim was meritless and procedurally unsound by submitting an agreed order striking it on Dec. 6. As a result of the circumstances, Mr. Gleason has managed to skirt MMS's motion for sanctions. Judge Olson directed Mr. Gleason to appear before the Court on April 20, 2011, at 1:30 pm, and to show cause why his conduct in filing the Claim on Mr. Denison's behalf should not be sanctioned by the imposition of non-monetary sanctions. MMS an unsecured creditor under the Debtor's confirmed plan of reorganization. A copy of Judge Olson's ruling is available at http://is.gd/cuuFox from Leagle.com. About New River Based in Fort Lauderdale, Florida, New River Dry Dock, Inc., filed for chapter 11 protection on July 18, 2006 (Bankr. S.D. Fla. Case No. 06-13274). James H. Fierberg, Esq., at Berger Singerman, P.A., represents the Debtor in its restructuring efforts. Mindy A. Mora, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it estimated assets between $10 million and $50 million and its debts between $1 million to $10 million. The Bankruptcy Court confirmed New River Dry Dock's Chapter 11 Liquidation Plan in October 2007. NEW STREAM: Facing Objections From Committee at Today's Hearing --------------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that New Stream Capital LLC now has an opponent in addition to a group whose members say they invested $90 million in New Stream's U.S. and Cayman Island funds. The three-member official unsecured creditors' committee, appointed April 6, lined up with the objecting investors by opposing the proposed secured financing and procedures for selling the portfolio of life-insurance policies. The committee, like the investor group, says the financing would benefit no one other than affiliates of McKinsey & Co., the proposed lender and purchaser of the policies. McKinsey is under contract to buy the policies for $127.5 million. The committee, like the investors, says that preparations for a sale were inadequate because there was nothing more than an eight-day marketing period eight months ago. Since then, New Stream has been under a so-called no-shop clause prohibiting any effort at finding a better offer. New Stream isn't proposing to hold an auction. It wants a breakup fee approved, with completion of the sale as part of the prepackaged Chapter 11 plan it hopes will win approval at an April 25 confirmation hearing. The hearing on the financing and sale-related issues is scheduled for today, April 14. The Chapter 11 Plan As reported in the Troubled Company Reporter on March 16, 2011, before seeking bankruptcy protection, New Stream negotiated a plan of reorganization with creditors. The prepackaged plan was "overwhelmingly approved" by investors. In order to meet the timeline in a Plan Support Agreement and the post-petition financing, the hearing to consider confirmation must take place not later than May 12, 2011. Over the last eight years, NSSC has invested primarily by making loans and equity investments. The aggregate indebtedness secured by the investment portfolio of NSSC is approximately $688,412,974. This debt is divided into two tranches. The secured claims of the NSSC Bermuda Lenders, in the approximate amount of $369,066,322, have first priority over the secured claims of the Cayman Fund and US Fund, which are parri passu; the claims of the Cayman Fund and US Fund aggregate $319,346,652. NSI is indebted to certain segregated account classes of the Bermuda Fund in the approximate amount of $81,573,376. The Plan is predicated on a rapidly executed sale of NSI's portfolio of life settlement contracts on the terms set forth in the asset purchase agreement with MIO Partners, Inc., an affiliate of several investors in the US Fund and Cayman Funds. MIO has designated Limited Life Assets Master Limited and Limited Life Assets Holdings Limited as the purchasers. The Plan provides for both the implementation of this asset sale and the allocation of the net proceeds among the Debtors' secured creditors. The Plan provided for the sale of the NSI Insurance Portfolio either pursuant to a "Consensual Process" or a "Cramdown Process". However, since Class 3 (which is described more fully in 104, infra) has voted to accept the Plan, the sale will take place pursuant to the Consensual Process and the Debtors do not presently intend to seek approval of the Insurance Portfolio Sale pursuant to Section 363 of the Bankruptcy Code prior to seeking confirmation of the Plan. The Plan treats creditors as follows: -- NSI Bermuda Lenders under Class 1, owed $81,573,376, which have voted to accept the plan, will receive less than the full amount owed. Payment will be from the net proceeds of the Insurance Portfolio Sale -- NSSC Bermuda Lenders under Class 2, owed $396,066,322, which hold a first lien on the investment portfolio of NSSC, will (1) receive will receive a distribution from the remaining proceeds of the Insurance Portfolio Sale and (2) substantially all of the remainder of NSSC's assets, except for certain assets that are being released for the benefit of the Class 3 Claims. They voted in favor the Plan. -- All holders of US-Cayman Claims, under Class 3, in the aggregate amount of $319,346,653, will each receive a percentage share of periodic distributions of the net proceeds from the liquidation of the common stock of North Star Financial Services Limited and specific assets and certain real estate and commercial loans (collectively identified as USC Wind Down Assets). In addition, holders of Class 3 Claims who voted to accept the Plan, and thereby grant the third-party releases provided for in section 12.5 of the Plan, will be entitled to receive a cash payment from the Global Settlement Fund upon the Plan's Effective Date. Under the Global Settlement, the Purchaser and Creditors in Classes 1 and 2, in exchange for the "yes" vote and the third-party releases, have agreed to provide funding for cash payments (expected to aggregate $15 million) to Class 3 claimants. -- Holders of general unsecured claims against NSI and NSCI, under Classes 4(a) and (d), will be paid in full and are not impaired under the Plan. Each holder of allowed general unsecured claim against NSC, in Class 4(c), will share, on a pro rata basis, in a cash distribution of. Holders of general unsecured claims against NSSC, in Class 4(b), will not receive any distribution or retain any property on account of such Claims and pursuant to Bankruptcy Code Sec. 1126(g) this Class is deemed not to have accepted the Plan. -- Holders of the Class 5(a) Interests in NSI that are currently held by NSSC will continue to be held by NSSC and the Class 5(d) Interests in NSCI that are currently held by the Cayman Funds will continue to be held by the Cayman Funds. Class 5(b) Interests in NSSC and Class 5(c) Interests in NSC will be extinguished and the Holders of Interests in Class 5(b) and Class 5(a) shall not receive or retain any property on account of such Interests. Each holder of a claim in Classes 1, 2, 3 and 4(c) was entitled to vote either to accept or reject the Plan A copy of the Plan is available for free at: http://bankrupt.com/misc/NewStream_Plan.pdf A copy of the Disclosure Statement explaining the terms of the Plan is available for free at: http://bankrupt.com/misc/NewStream_DS.pdf About New Stream New Stream is an inter-related group of companies that collectively comprise an investment fund, headquartered in Ridgefield, Connecticut. Founded in 2002, New Stream focuses on providing non-traded private debt to the insurance, real estate and commercial finance sectors. On March 7, 2011, when New Stream was still soliciting votes on the Chapter 11 plan, certain investors filed a petition (Bankr. D. Del. Lead Case No. 11-10690) seeking to force three new stream funds -- New Stream Secured Capital Fund (U.S.) LLC, New Stream Secured Capital Fund P1 (Cayman), Ltd. and New Stream Secured Capital Fund K1 (Cayman), Ltd. -- to Chapter 11 bankruptcy. The petitioning investors in the New Stream investment enterprise say they are collectively owed over $90 million, representing roughly 28% of the approximately $320 million owed to all U.S. and Cayman investors. The Petitioners are represented by (i) Joseph H. Huston, Jr., Esq., Maria Aprile Sawczuk, Esq., Meghan A. Cashman, Esq., at Stevens & Lee, P.C., in Wilmington, Delaware, and Beth Stern Fleming, Esq., at Stevens & Lee, P.C., in Philadelphia, Pennsylvania, and Nicholas F. Kajon, Esq., David M. Green, Esq., and Constantine Pourakis, Esq., at Stevens & Lee, P.C., in New York, (ii) Edward Toptani, Esq., at Toptani Law Offices, in New York, and (iii) John M Bradham, Esq., and David Hartheimer, Esq., at Mazzeo Song & Bradham LLP, in New York. New Stream Secured Capital, Inc., and three affiliates (New Stream Insurance, LLC, New Stream Capital, LLC, and New Stream Secured Capital, L.P.) filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 11-10753) on March 13, 2011, with a proposed prepackaged Chapter 11 plan. Kurt F. Gwynne, Esq., J. Cory Falgowski, Esq., Michael J. Venditto, Esq., and Scott M Esterbrook, Esq., at Reed Smith LLP, serve as the Debtors' bankruptcy counsel. Kurtzman Carson Consultants LLC is the Debtors' claims and notice agent. NSSC, Inc., estimated its assets and debts at up to $50,000. NSC estimated its assets at $100,000 to $500,000 and debts at $50,000 to $100,000. NSI estimated its assets at $100 million to $500 million and debts at $50 million to $100 million. NSSC, LP, estimated its assets and debts at $500 million to $1 billion. NSI's insurance portfolio is being sold for $184.35 million as part of the Chapter 11 plan. The aggregate indebtedness secured by the investment portfolio of NSSC is $688,412,974. NSI owes $81,573,376 to certain account classes under a Bermuda fund. NEXHORIZON BROADBAND: Case Summary & Creditors List --------------------------------------------------- Debtor: NexHorizon Broadband of Southern California, Inc. fka National City Cable, Inc. P.O. Box 7208 Westminster, CO 80021-7208 Bankruptcy Case No.: 11-17956 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court District of Colorado (Denver) Judge: Elizabeth E. Brown Debtor's Counsel: Aaron A Garber, Esq. KUTNER MILLER BRINEN, P.C. 303 E. 17th Avenue, Suite 500 Denver, CO 80203 Tel: (303) 832-2400 E-mail: aag@kutnerlaw.com Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/cob11-17956.pdf The petition was signed by Calvin D. Smiley, Sr., president & CEO. Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- NexHorizon Communications, Inc. 10-24682 06/11/10 NexHorizon of Colorado, Inc. 09-12193 02/17/09 NEXTAG INC: S&P Assigns 'BB-' Corporate Credit Rating ----------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'BB-' corporate credit rating to San Mateo, Calif.-based NexTag Inc., owner and operator of several comparison shopping Web sites. The rating outlook is stable. "At the same time, we assigned NexTag's $190 million secured first-lien credit facilities our issue-rating of 'BB-' (at the same level as the 'BB-' corporate credit rating) with a preliminary recovery rating of '4', indicating our expectation of average (30%-50%) recovery for debtholders in the event of a payment default. The credit facilities consist of a $40 million revolving credit facility due 2016 and a $150 million term loan due 2016," S&P stated. "The 'BB-' corporate credit rating incorporates our assumption of moderate revenue growth over the next several years, driven by growth in total visits to company Web sites, as well as a possible increase in traffic monetization beginning in 2012," said Standard & Poor's credit analyst Andy Liu. NexTag is the owner and operator of comparison shopping Web sites. The company's Web sites connect over 40 million monthly unique visitors and over 25,000 merchants. NexTag has several direct competitors, including Shopzilla.com and Pricegrabber.com. The basis of competition is the volume and value of Internet traffic delivered to merchants. Additionally, NexTag indirectly competes with some of its clients and with search engines for Internet traffic. "The stable rating outlook assumes that the business will continue to grow, enabling the company to expand its EBITDA base and maintain covenant compliance," said Mr. Liu. "Still, we could lower the rating if debt leverage reaches 3x. This could happen if revenue declines 15%, coupled with a meaningful deterioration in EBITDA margins. It is also possible that debt leverage reaches 3x due to debt-financed acquisitions." NEXSTAR BROADCASTING: S&P Puts 'BB-' Rating on Proposed $50MM Loan ------------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned a 'BB-' issue-level rating to the proposed $50 million incremental senior secured term loan of Nexstar Broadcasting Inc. (two notches above the 'B' corporate credit rating of the parent, Irving, Texas-based Nexstar Broadcasting Group Inc.). "The recovery rating on the debt is '1', indicating our expectation of very high (90% to 100%) recovery for lenders in the event of a payment default. Nexstar plans to use the net proceeds of the loan to redeem its outstanding 11.375% senior discount notes, to pay related fees and expenses, and for general corporate purposes," S&P related. "At the same time, we affirmed the 'B' corporate credit rating on Nexstar Broadcasting Group Inc. and the issue-level ratings on the consolidated company's debt. We also revised the recovery rating on the company's $325 million second-lien notes to '4', indicating our expectation of average (30% to 50%) recovery for note holders in the event of a payment default, from '3'," S&P noted. "We also revised our rating outlook on Nexstar to positive from stable. The rating outlook revision reflects our expectation that, barring unforeseen events, the company will be able to continue reducing its leverage on an average trailing-eight- quarter EBITDA basis so that lease-adjusted debt to EBITDA approaches the mid-6x range within the next 12 months," S&P stated. "The rating affirmation reflects our view that the proposed transaction, combined with the pending acquisition of two small CBS affiliates, is essentially leverage-neutral and will slightly improve the company's lease-adjusted EBITDA coverage of interest by replacing high-coupon debt with lower-cost bank borrowings," said Standard & Poor's credit analyst Deborah Kinzer. "Our rating outlook revision reflects our expectation that 2011 EBITDA will be significantly higher than the 2009 mid-recession level, so that the ratio of the company's lease-adjusted debt to average trailing-eight-quarter EBITDA could decline to the mid-6x range within the next 12 months. Events that could forestall the achievement of this threshold include a reversal of the recovery in core ad demand, failure to renew affiliation agreements with major networks, and an NFL lockout that extends into the football season." NORTEK INC: S&P Affirms 'B' Corporate Credit Rating --------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'B' corporate credit rating on Providence, R.I.-based Nortek Inc. The rating outlook is stable. "We assigned our 'BB-' issue-level rating (two notches higher than the corporate credit rating) to Nortek's proposed $350 million senior secured term loan due 2017 based on preliminary terms and conditions. The recovery rating is '1', indicating our expectation of very high (90% to 100%) recovery for lenders in the event of a payment default. At the same time, we assigned our 'B' issue-level rating (the same as the corporate credit rating) to Nortek's proposed $500 million senior notes due 2021 based on preliminary terms and conditions. The recovery rating is '4', indicating our expectation of average (30% to 50%) recovery for lenders in the event of a payment default. If the proposed transaction closes in a manner consistent with the preliminary terms and conditions, we would likely raise the issue- level rating on the existing senior unsecured notes due 2018 to 'B' from 'CCC+', and revise the recovery rating to '4' from '6'," S&P stated. The company intends to use the proceeds of the proposed senior secured term loan facility and senior notes to redeem or repurchase its 11% senior secured notes due 2013. "The 'B' rating on Nortek reflects what we consider to be the company's highly leveraged financial risk profile, given our expectations that adjusted leverage is likely to exceed 5x over the upcoming year," said Standard & Poor's credit analyst Tobias Crabtree. While the proposed refinancing transaction addresses the significant portion of the company's capital structure that matures in 2013, we expect credit measures to remain weak over the next several quarters given that a significant portion of the company's cash flow will be needed to service its more than $1 billion of debt. The ratings also reflect what we consider to be its fair business risk profile, as we believe the company has leading positions in diverse product lines, such as kitchen range hoods and exhaust fans, which is somewhat offset by its considerable exposure to challenging residential and nonresidential construction end markets," S&P noted. "The ratings incorporate our expectation that demand for Nortek's products sold to residential end markets, including its kitchen range hoods, exhaust fans, and ventilation products, which account for about 30% of its sales, may moderately increase as housing markets and the general economy continue to recover. Specifically, we believe repair and replacement markets, which account for the majority of the company's residential ventilation products and residential HVAC sales, could improve about 3% to 5% over the next year. The stable rating outlook reflects our expectation that Nortek's operating performance during the next several quarters will be relatively in-line with its recent levels due to a gradual improvement in the residential housing market, resulting in credit measures that we would consider to be in-line with the ratings given the company's fair business risk profile. Specifically, we expect adjusted leverage to remain above 5x, interest coverage at or below 2x, and adjusted EBITDA of at least $200 million over the next year. This expectation is based on a gradual recovery in the company's residential end markets, especially repair and replacement construction activity, but still weak commercial construction activity and manageable raw material cost inflation. In addition, our outlook reflects our view that the company's liquidity position is likely to remain adequate following the recent extension of its ABL facility's maturity to 2015," S&P elaborated. "We could take a negative rating action if adjusted EBITDA were to decline in excess of 20% from our projected level of more than $200 million due to a double-dip recession and reduced construction activity or rapidly rising raw material costs. Specifically, for a lower rating, leverage would likely have to exceed 7x," S&P stated. "At this time, we believe a positive rating action is unlikely given our expectations for leverage to be maintained above 5x throughout 2011. Still, if operating results were to meaningfully improve, such as due to a much greater-than-expected recovery in residential construction activity, resulting in leverage being maintained between 4x and 5x then we could consider a higher Rating," S&P added. NORTH GENERAL: U.S. Trustee Wants J. Garrity as Ch. 11 Trustee -------------------------------------------------------------- Tracy Hope Davis, U.S. Trustee for Region 2 asks the U.S. Bankruptcy Court for the Southern District of New York to appoint James L. Garrity, Jr. as the Chapter 11 trustee in North General Hospital and its Debtor affiliates' bankruptcy cases. The request was made after the Court entered an order directing the appointment of a Chapter 11 trustee on March 28, 2011. Subsequently, the Court granted the request provided that a $1,550,000 bond is posted. About North General New York-based North General Hospital is a not-for-profit 200-bed community hospital in upper Manhattan that has serviced the communities of East and Central Harlem since the 1970s. The Hospital filed for Chapter 11 bankruptcy protection on July 2, 2010 (Bankr. S.D.N.Y. Case No. 10-13553). Charles E. Simpson, Esq., at Windels, Marx, Lane & Mittendorf, LLP, assists the Debtor in its restructuring effort. Garfunkel Wild, P.C., is the Debtor's special healthcare and regulatory counsel. Healthcare Management Solutions, LLC, is the Debtor's financial and healthcare reimbursement manager. Alston & Bird, LLP, serves as the Official Committee of Unsecured Creditors' counsel. NHB Advisors, Inc., is the financial advisor to the Committee. The Company disclosed $67 million in assets and $293 million in liabilities as of the Petition Date. OLD COLONY: Hearing on Cash Collateral Motion Set for April 28 -------------------------------------------------------------- Hon. Henry J. Boroff of the U.S. Bankruptcy Court for the District of Massachusetts (Boston) will convene a hearing on Old Colony LLC's request for continued use of cash collateral on April 28, 2011, at 2:00 p.m. About Old Colony Saugus, Massachusetts-based Old Colony, LLC, dba The Inn At Jackson Hole, filed for Chapter 11 bankruptcy protection (Bankr. D. Mass. Case No. 10-21100) on Oct. 11, 2010. Donald F. Farrell, Jr., Esq., at Anderson Aquino LLP, assists the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $10 million to $50 million as of the Petition Date. OTTER TAIL: Completes Sale of Business to Green Plains for $60MM ---------------------------------------------------------------- Otter Tail Ag Enterprises LLC has completed a sale of its ethanol production facility pursuant to Section 363 of the bankruptcy code to Green Plains Renewable Energy Inc. Total consideration was approximately $60 million, of which $55 million was for the property, plant and equipment and the remainder for inventories and other assets. The investment banking group of Carl Marks Advisory Group LLC acted as exclusive M&A and financial advisor to Otter Tail. Otter Tail filed for bankruptcy in October 2009 and originally intended to pursue a Plan of Reorganization that provided for a full reinstatement of the secured lenders' indebtedness of approximately $55 million and a recovery of $6.5 million in cash and $2.3 million of equity to the bondholders on their total claim of approximately $26 million. Ultimately, that Plan of Reorganization did not materialize, and in October 2010, Otter Tail engaged Carl Marks to conduct a formal sale process. In January 2011, Carl Marks and Otter Tail installed Green Plains as the Stalking Horse Bidder, leading to a successful sale of the assets and a distribution of approximately $16 million in cash to the bondholders - a premium of more than 80 percent over the previously agreed upon Plan of Reorganization. "This transaction realized significant value for all constituents in a volatile marketplace," said Christopher K. Wu, partner of Carl Marks Advisory Group. "The deal is an outstanding outcome for all of the parties involved in the transaction." This transaction marks the sixth consecutive engagement for Carl Marks in the domestic ethanol industry. The firm has collectively advised constituents throughout the capital structure on engagements representing over 2.4 billion gallons of ethanol production capacity. About Carl Marks Advisory Group LLC Carl Marks Advisory Group LLC -- http://www.carlmarks.com/-- with offices in New York, Vienna, Va., Bedminster, N.J., and Charlotte, N.C., provides a wide array of investment banking and financial, operational and real estate advisory services to the middle market, including mergers and acquisitions advice, sourcing of capital, financial restructuring plans, strategic business assessments, improvement plans and interim management. Carl Marks Advisory Group is the 2010 recipient of the Turnaround Management Association's Turnaround of the Year Award in the Large Company category. Carl Marks Securities LLC, based in New York, assists its clients in executing private placements of debt and equity. The firm is a member of FINRA and SIPC. About Otter Tail AG Based in Fergus Falls, Minnesota, Otter Tail AG Enterprises, LLC -- http://www.ottertailethanol.com/-- owns and operates a nameplate capacity 55 million gallon annual production plant of undenatured ethanol in Fergus Falls, Minnesota. The Company processes approximately 20 million bushels of corn into approximately 55 million gallons of ethanol each year. In addition, the Company sells distillers grains, a principal co-product of the ethanol production process. The Company filed for Chapter 11 on Oct. 30, 2009 (Bankr. D. Minn. Case No. 09-61250). Attorneys at Mackall, Crounse & Moore, PLC, represent the Debtor in the Chapter 11 case. Carl Marks Advisory Group LLC is the financial advisor. The Debtor disclosed assets of $66.4 million against $86 million in debt, nearly all secured, in its schedules. The largest secured creditor is AgStar Financial Services, owed $40.9 million. OUTSOURCE HOLDINGS: Files List of 18 Largest Unsecured Creditors ---------------------------------------------------------------- Outsource Holdings, Inc., has filed with U.S. Bankruptcy Court for the Northern District of Texas its list of 18 largest unsecured creditors, disclosing: Entity Nature of Claim Claim Amount ------ --------------- ------------ BNY Mellon, Indenture Trustee Indenture $5,280,058 525 William Penn Place 7th Floor Pittsburgh, PA 15259 Duncan Burkholder 2009 Notes $688,500 4515 Marsha Sharp Freeway Lubbock, TX 79407 James Young 2009 Notes $688,500 5010 91st Street, #8 Lubbock, TX 79424 John Walton 2009 Notes $573,750 4718 S. Loop 289 Lubbock, TX 79414 James Mils 2009 Notes $570,000 8160 Sundance Dr. Mansfield, TX 76063 Jim Burke 2009 Notes $570,000 8136 Sundance Dr. Mansfield, TX 76063 Larry Rother 2009 Notes $570,000 3601 Misty Creek Drive Austin, TX 78735 Greg Garland 2009 Notes $401,625 5723 83rd Lane Lubbock, TX 79424 Ricky Green 2009 Notes $401,625 4903 97th Street Lubbock, TX 79424 Bruce Orr 2009 Notes $285,000 3617 Woodedcreek Cr. Arlington, TX 76016 Ronnie Malone 2009 Notes $285,000 5506 Vista Meadow Dallas, TX 75248 Duncan Burkholder 2010 Notes $22,145 James Young 2010 Notes $22,145 John Walton 2010 Notes $18,455 Greg Garland 2010 Notes $12,918 Ricky Green 2010 Notes $12,918 Bruce Orr 2010 Notes $9,227 Ronnie Malone 2010 Notes $9,227 About Outsource Holdings Lubbock, Texas-based Outsource Holdings, Inc.'s only significant asset is its ownership of all of the outstanding capital stock of Jefferson Bank, which is a state bank with five branch locations in the Dallas/Fort Worth metroplex. Outsource Holdings believes that a sale/merger of its interests in Jefferson Bank before August 2011 offers the best opportunity for maximizing the value of this asset for this bankruptcy estate and its creditors. The Debtor has been unable to obtain consent from its creditors to conduct a sale or merger outside of bankruptcy. Since Outsource Holdings believes that a sale before August 2011 is necessary to avoid significant and sudden further declines in the value of its interests in Jefferson Bank, Outsource Holdings believes its fiduciary duties to its creditor body as a whole required the initiation of the bankruptcy case. Outsource Holdings filed for Chapter 11 bankruptcy protection on April 3, 2011 (Bankr. N.D. Tex. Case No. 11-41938). Jeff P. Prostok, Esq., at Forshey & Prostok, LLP, serves as Outsource Holdings' bankruptcy counsel. Outsource Holdings estimated its assets and debts at $10 million to $50 million. OVERLAND STORAGE: Joseph De Perio Appointed as Board Member ----------------------------------------------------------- The Board of Directors of Overland Storage, Inc., upon the recommendation of its Nominating and Governance Committee, appointed Joseph A. De Perio to fill one of the vacancies on the Board of Directors. Mr. De Perio will serve as a director of the Company for a term of office expiring at the Company's next Annual Meeting of Shareholders. Mr. De Perio will receive compensation in accordance with the Company's standard compensation arrangements for non-employee directors. Mr. De Perio was selected as a director pursuant to the terms of a Stock Purchase Agreement dated March 16, 2011, by and among the Company, Clinton Magnolia Master Fund Ltd. and certain other investors party thereto. Pursuant to the Purchase Agreement, CMAG acquired 2,832,861 shares of common stock of the Company and warrants exercisable to purchase 1,246,458 shares of common stock of the Company for total consideration of $5.0 million. Mr. De Perio is a portfolio manager of Clinton Group, Inc., the investment manager for CMAG. The Board of Directors has determined that Mr. De Perio qualifies as independent under the independence standards set forth in NASDAQ Marketplace Rule 5605(a)(2). About Overland Storage San Diego, Calif.-based Overland Storage, Inc. (Nasdaq: OVRL) -- http://www.overlandstorage.com/-- is a global provider of unified data management and data protection solutions designed to enable small and medium enterprises (SMEs), corporate departments and small and medium businesses (SMBs) to anticipate and respond to change. The Company's balance sheet at Dec. 31, 2010 showed $39.82 million in total assets, $38.31 million in total liabilities and $1.52 million in shareholders' equity. As reported in the Troubled Company Reporter on Sept. 28, 2010, Moss Adams LLP, in San Diego, Calif., expressed substantial doubt about Overland Storage'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. PACIFIC DEVELOPMENT: Has OK to Sell Five Lots to Sierra Homes ------------------------------------------------------------- Bankruptcy Judge R. Kimball Mosier authorized Pacific Development, L.C., to sell five parcels of real property located in Heritage Village, Payson, Utah County, Utah: (i) 41-711-34; (ii) 41-711-35; (iii) 41-711-36; (iv) 41-711-37; and (v) 41-711-40, free and clear of all liens, claims and encumbrances, to Sierra Homes Construction, Inc. A copy of the Court's April 6, 2011 Findings and Conclusions is available at http://is.gd/RHxuU7from Leagle.com. About Pacific Development Provo, Utah-based Pacific Development, L.C., is the obligor on and owner of various real estate development loans for properties primarily located in Payson, Salem, Springville and Harrisburg, Utah. The Company filed for Chapter 11 protection (Bankr. D. Utah Case No. 10-22754) on March 10, 2010. Danny C. Kelly, Esq. at Stoel Rives LLP represents the Debtor in its restructuring effort. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. The Official Committee of Unsecured Creditors is represented by David P. Billings and J. Thomas Beckett at Parsons, Behle & Latimer, P.C. PAPERWORKS INDUSTRIES: S&P Assigns 'B' Corporate Credit Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'B' corporate credit rating to Philadelphia, Pa.-based PaperWorks Industries Holding Corp. The outlook is stable. "At the same time, we assigned preliminary issue-level and recovery ratings to the company's proposed $250 million senior secured credit facilities. The credit facilities consist of a $40 million senior secured revolving credit facility and a $210 million senior secured term loan. We have assigned preliminary 'B+' ratings (one notch higher than the corporate credit rating) and a preliminary '2' recovery rating to the senior secured debt. The '2' recovery rating indicates our expectation of substantial (70% to 90%) recovery for lenders in the event of a payment default," S&P related. The company intends to use proceeds to refinance existing debt and the bridge loan used to fund two acquisitions, namely Manchester Industries and Rosmar Packaging Corp., and to pay related fees and expenses. In January 2011, an affiliate of PaperWorks' equity sponsor, Sun Capital Partners, completed these two strategic acquisitions with the plan to merge these businesses into PaperWorks in conjunction with the refinancing of PaperWorks' credit facility. "The preliminary ratings on PaperWorks reflect its highly leveraged financial risk profile, participation in the very competitive and fragmented paperboard industry, significant customer concentration, and some substitution risk from alternative packaging materials," said Standard & Poor's credit analyst Liley Mehta. "Partially tempering factors include relatively recession resistant demand from consumer end markets, contractual pass through of raw material price fluctuations for a majority of its customers, and integrated paperboard manufacturing operations with the ability to produce different substrates." PaperWorks is a manufacturer of folding cartons and paperboard. The packaging segment, which represents more than half of consolidated revenues, primarily includes folding cartons for personal care, household and fabric care, pet care, food, health care, and other consumer products which have relatively recession resistant demand. The paperboard segment (which accounts for the balance of its sales) manufactures and sheets paperboard for the folding carton market, as well as for internal consumption. "The stable rating outlook reflects our expectations of gradual improvement in operating performance as a result of integration benefits from the Manchester and Rosmar acquisitions, and low- single-digit sales volume growth coupled with our expectations for manageable increases in raw materials costs," S&P related. "A negative rating action could occur if EBITDA declined, which we believe could cause cash flow to decline and liquidity to tighten considerably. This could occur due to customer losses, or if input costs, especially for old corrugated containers, increase materially and sales price increases do not take hold. We could also lower the ratings if free cash flow turns negative for an extended period, or if the key credit metric of debt to EBITDA is near or above 6x on a consistent basis. In addition, we have reservations about financial policy, particularly in light of the private equity ownership and acquisition-driven growth strategy,' S&P noted. "If the company successfully completes the integration of the Rosmar and Manchester acquisitions and maintains an improving earnings and consistent free cash generation, we could raise ratings modestly," S&P stated. PHOENIX ASSOCIATES: Trustee Cannot Avoid Transfer of Appeal Bond ---------------------------------------------------------------- Wilbur J. Babin, Jr., the trustee in the chapter 7 bankruptcy case of Phoenix Associates Land Syndicate, Inc., filed a complaint against E.H. Mitchell & Company, L.L.C., seeking to avoid the recordation of a monetary judgment and to avoid a transfer of an appeal bond originally posted in state court by the Debtor. In an April 6, 2011 Memorandum Opinion, available at http://is.gd/O74ws2 from Leagle.com, Bankruptcy Judge Jerry A. Brown held that the Chapter 7 trustee can avoid the recordation of the judgment, but the trustee cannot avoid the transfer of the appeal bond. The case is Wilbur J. "Bill" Babin, Jr., in his capacity as trustee of the bankruptcy estate of Phoenix Associates Land Syndicate, v. E.H. Mitchell & Company, L.L.C., Adv. Pro. No. 10-1020 (Bankr. E.D. La.). About Phoenix Associate Based in Madisonville, Louisiana, Phoenix Associates Land Syndicate, dba Murphy Sand and Gravel -- http://www.pbls.biz/-- focused principally on the acquisition and development of companies in the aviation, construction, mining and oil & gas industries. The Company filed for Chapter 11 on June 10, 2009 (Bankr. E.D. La. Case No. 09-11743). Claude C. Lightfoot, Jr., at Claude C. Lightfoot, Jr. P.C., represented the Debtor in its restructuring efforts. In its schedules, the Debtor listed $6,300 in total assets and $20,135,813 in total liabilities. The case was converted to Chapter 7 on July 31, 2009. PINNACLE HILLS: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Pinnacle Hills West, LLC 5506 Walsh Lane, Suite 212 Rogers, AR 72758 Bankruptcy Case No.: 11-71721 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court Western District of Arkansas (Fayetteville) Debtor's Counsel: Stanley V. Bond, Esq. BOND LAW OFFICE P.O. Box 1893 Fayetteville, AR 72701-1893 Tel: (479) 444-0255 Fax: (479) 444-7141 E-mail: attybond@me.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $50,000,001 to $100,000,000 The petition was signed by Bill Schwyhart, manager of Schwyhart Holdings, LLC, manager. Debtor's List of nine Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ The Private Bank & Trust Co. Real Estate $19,768,234 1401 S Brentwood Boulevard Saint Louis, MO 63144 Chambers Bank Real Estate $6,305,113 1685 E. Joyce Boulevard Fayetteville, AR 72703 Liberty Bank of Arkansas Real Estate $5,698,929 P.O. Box 7514 Jonesboro, AR 72403 Benton County Tax Collector 2008 and 2009 $1,024,942 215 East Central, Suite 3 Delinquent Taxes Bentonville, AR 72712 Traffic & Lighting Systems -- $151,638 McGoodwinWilliamsYates, Inc. -- $93,563 Butler, Rosenbury & Prtnrs Inc -- $46,484 Frost, PLLC -- $800 Delaware Secy of State -- $271 PPL CAPITAL: Fitch Puts 'BB+' Rating on Junior Subordinated Notes ----------------------------------------------------------------- Fitch Ratings has assigned a 'BB+' rating to PPL Capital Funding, Inc.'s new $850 million issue of 4.32% junior subordinated notes due June 2019. The notes are a component of PPL Corp.'s (PPL) offering of equity units. The equity units consist of the notes and a forward purchase contract obligating the holder to purchase, no later than May 1, 2014, a stated number of PPL common stock. The Ratings Outlook is Stable. Net proceeds of this offering and a concurrent common stock offering will be used to reduce PPL's borrowings under a bridge loan facility used to fund the acquisition of Central Networks, a UK electricity distribution business, from E.ON AG. The acquisition closed on April 1, 2011. The ratings of PPL Capital Funding are based on an unconditional guarantee by its corporate parent PPL. PPL's ratings reflect its rapid transformation from a company heavily reliant on commodity sensitive businesses to one that is highly regulated with substantially less business risk. Driven by the acquisitions of Central Networks in April 2011 and LG&E and KU Energy, LLC, in November 2010, regulated operations are expected by Fitch to provide approximately 75% of consolidated EBITDA by 2013. By comparison regulated operations accounted for approximately 30% of EBITDA prior to the acquisitions. The ratings also reflect Fitch's expectation that the initial rise in leverage from funding the aforementioned acquisitions will decline over the next few years. The expected improvement recognizes a full year of earnings from the two acquisitions, including synergy savings at the newly acquired UK electricity distribution businesses, and a $77 million rate increase implemented by PPL's US electricity business, PPL Electric Utilities Corp. (Issuer Default Rating [IDR] 'BBB' by Fitch) effective Jan. 1, 2011. Fitch calculates the pro forma 2010 ratio of debt/EBITDA, adjusted to include the permanent acquisition financing and the 2011 earnings contribution of Central Networks, increased to 5.1 times (x) compared to the 2010 debt/EBITDA of 4.4x. By 2013, Fitch expects this leverage measure to fall below 4.0x. The ability to extract expected synergy savings from the newly acquired UK businesses and a challenging operating environment for PPL's US wholesale power business are the primary credit concerns. Driven primarily by lower energy and capacity prices and higher fuel costs, the earnings and cash flow contribution of PPL's wholesale power business are expected to decline in 2011 and remain under pressure for several years. In addition, management forecasts an increase in 2011 operating and maintenance expense. The concurrent offerings of common stock and equity units completes approximately 50% of the permanent acquisition funding related to the Central Networks acquisition, which was initially funded with a GBP3.6 billion (approximately $5.8 billion) bridge loan facility. PPL plans to term out the remaining borrowings of approximately $3 billion with long-term debt to be issued at the newly acquired UK entities. The new notes will be subordinate and junior to all of PPL Capital Funding's existing and future senior indebtedness. Prior to May 1, 2016, PPL Capital Funding will have the right to defer interest on the notes one or more times for one or more consecutive interest periods without giving rise to an event of default. The notes will be pledged as security for the holders' obligation to purchase the PPL common stock by May 1, 2014. The securities will be remarketed in two tranches and will be subordinated unsecured obligations of PPL Capital Funding and will remain outstanding until maturity in 2019. The notes will initially pay a fixed 4.32% rate of interest through May 1, 2014, payable quarterly. Holders of the equity units will also receive quarterly contract payments of 4.43% on the forward purchase contract. The company may elect to remarket the notes as fixed rate notes and/or floating rate notes. PROFESSIONAL VETERINARY: Plan Exclusivity Extended Until May 17 --------------------------------------------------------------- The Hon. Timothy J. Mahoney extended until May 17 the time within which Professional Veterinary Products, Ltd., and its debtor affiliates have exclusive right to solicit acceptances of their plan of liquidation. Direct Vet Marketing, Inc., a creditor holding more than $17 million in claims, objected to the approval of the disclosure statement explaining the liquidation plan. To resolve DVM's objection, the Debtors and the Official Committee of Unsecured Creditors entered into a stipulation with the creditor providing for the liquidation of the DVM claim either through a negotiated resolution or an appropriate adversary proceeding or contested matter. The parties also agreed that any hearing on the approval of the Disclosure Statement will be continued only after (i) the DVM claim is resolved or (ii) until one of the parties seeks a further hearing date, though no party can make that request on or before July 1. The stipulation also prohibits DVM from objecting to the Plan or seeking for the dismissal or conversion of the Debtors' bankruptcy cases or filing a competing plan. About Professional Veterinary Products Professional Veterinary Products Ltd. -- http://www.pvpl.com/-- operates a veterinary supply company owned and managed by veterinarians. Professional Veterinary sought Chapter 11 protection from creditors on August 20, 2010, in Omaha, Nebraska (Bankr. D. Neb. Case No. 10-82436). Affiliates ProConn and Exact Logistics also filed for Chapter 11. The Company reported $89.79 million in total assets, $78.23 million in total liabilities, and $11.56 million in stockholders' equity at April 30, 2010. The Company hired McGrath North Mullin & Kratz PC LLC, as bankruptcy counsel and Alliance Management as financial and restructuring advisors. As reported in the Troubled Company Reporter on December 29, 2010, the Debtors and the Official Committee of Unsecured Creditors have submitted to the Bankruptcy Court a proposed Plan of Liquidation and an explanatory Disclosure Statement. PROFESSIONAL VETERINARY: Seeks to Employ BKD LLP as Auditors ------------------------------------------------------------ Professional Veterinary Products, Ltd., a Nebraska corporation, and its debtor affiliates seek court authority to employ BKD, LLP, as their auditors. The Debtors relate that they seek to employ BKD to perform auditing work relating to their Master Profit Sharing Plan and Trust. The Debtors, according to Robert P. Diederich, Esq., at McGrath North Mullin & Kratz, PC LLO, in Omaha, Nebraska, have wound up their Profit Sharing Plan. If the Profit Sharing Plan has not been properly terminated, there is a potential risk of liability that the Debtors could face, Mr. Diedrerich says. A final audit would ensure that the Profit Sharing Plan has been properly terminated and thus would reduce the potential for any liability owing from the Debtors, he adds. BKD is owed $20,000 in prepetition debt. BKD, Mr. Diederich relates, is unwilling to provide any postpetition services to the Debtors without receiving payment of 60% of the prepetition debt. To ensure that the Debtors retain the value-enhancing services of BKD, the Debtors seek to pay BKD $12,000, the amount representing 60% of the value of BKD's claim, a distribution marginally more than the Debtors estimate it will receive as a distribution in under their plan of liquidation. In exchange for the payment, BKD would waive its right to the balance of its unsecured, prepetition claim, Mr. Diederich says. About Professional Veterinary Products Professional Veterinary Products Ltd. -- http://www.pvpl.com/-- operates a veterinary supply company owned and managed by veterinarians. Professional Veterinary sought Chapter 11 protection from creditors on August 20, 2010, in Omaha, Nebraska (Bankr. D. Neb. Case No. 10-82436). Affiliates ProConn and Exact Logistics also filed for Chapter 11. The Company reported $89.79 million in total assets, $78.23 million in total liabilities, and $11.56 million in stockholders' equity at April 30, 2010. The Company hired McGrath North Mullin & Kratz PC LLC, as bankruptcy counsel and Alliance Management as financial and restructuring advisors. As reported in the Troubled Company Reporter on December 29, 2010, the Debtors and the Official Committee of Unsecured Creditors have submitted to the Bankruptcy Court a proposed Plan of Liquidation and an explanatory Disclosure Statement. RAY ANTHONY: Seeks to Employ W.B. Kania as Accountant ----------------------------------------------------- Ray Anthony International, LLC seeks permission from the U.S. Bankruptcy Court for the Western District of Pennsylvania to employ W.B. Kania & Associates, LLC as its accountant. As the Debtor's accountant, W.B. Kania will prepare, review and file tax returns on behalf of the Debtor. The Debtor will pay W.B. Kania at $150 per hour. W.B. Kania has no connection with the Debtor, nor represent any interest adverse to the Debtor or any other party-in-interest. West Mifflin, Pennsylvania-based Ray Anthony International, Inc., filed for Chapter 11 bankruptcy protection (Bankr. W.D. Pa. Case No. 10-26576) on Sept. 15, 2010. The Debtor estimated assets and debts at $50 million to $100 million as of the Chapter 11 filing. Affiliate Ray G. Anthony filed a separate Chapter 11 petition (Bankr. W.D. Pa. Case No. 10-26552) on Sept. 14, 2010. RAY ANTHONY: Has Until April 13 to Decide on Unexpired Leases ------------------------------------------------------------- At Ray Anthony International, LLC's request, the U.S. Bankruptcy Court for the Western District of Pennsylvania extended the deadline by which the Debtor may assume or reject its lease of nonresidential real property until April 13, 2011. The Debtor's deadline to assume or reject its business premises leases expired on March 14, 2011 pursuant to Section 365(d)(4) of the Bankruptcy Code. West Mifflin, Pennsylvania-based Ray Anthony International, Inc., filed for Chapter 11 bankruptcy protection (Bankr. W.D. Pa. Case No. 10-26576) on Sept. 15, 2010. The Debtor estimated assets and debts at $50 million to $100 million as of the Chapter 11 filing. Affiliate Ray G. Anthony filed a separate Chapter 11 petition (Bankr. W.D. Pa. Case No. 10-26552) on Sept. 14, 2010. RCC NORTH: U.S. Bank Plan Disclosures Hearing Scheduled for May 18 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Arizona will convene a hearing on May 18, 2011, to consider approval of the disclosure statement explaining the Chapter 11 plan of reorganization which U.S. Bank N.A. proposed for RCC North LLC. Under U.S. Bank's proposed restructuring plan, claims and interests are divided into five classes: Class 1-A Administrative Claims, Class 2 Security Claims, Class 3 General Unsecured Claims, Class 4 U.S. Bank Unsecured Claim, and Class 5 Interest. Class 1 is further divided into three classes. Class 1-A consists of administrative claims while Classes 1-B and C consist of wage and tax claims, respectively. These claims will be paid in full and in cash unless the creditors agree to an alternative form of treatment. Class 2 is also further divided into four classes. Class 2-A consists of allowed secured claim of U.S. Bank while Class 2-B consists of allowed secured claim of Maricopa County for real property taxes. Meanwhile, Classes 2-C and 2-D consist of allowed secured claims of Fennemore Craig and Larson Allen, respectively. The plan proposes to, among other things, transfer to U.S. Bank title to any personal property collateral for its loan including cash collateral. The bank will be required to pay allowed unsecured claims in full from its cash collateral after the plan takes effect. Fennemore Craig's and Larson Allen's secured claims will be paid in full from their retainer. The balance of the retainer will be paid to U.S. Bank or its designee. As for Maricopa County's secured claim, the plan proposes to pay it in full, with interest, as of the effective date to the extent such claim exist. Class 3 consists of allowed unsecured claims of creditors other than U.S. Bank. They will be paid in full following the effective date. Class 4 consists of U.S. Bank's allowed unsecured claim. On account of this claim, the bank will receive any property of RCC North's estate not subject to a valid and enforceable lien or security interest in favor of the bank. Meanwhile, Class 5 consists of allowed interests held by Raintree Corporate Center Holdings LLC. RCCH will retain its equity interests in RCC North, according to the proposed plan. Under the proposed plan, Classes 2-A and 4 are impaired, thus, only those classes are entitled to vote on the plan. The other classes are unimpaired. The plan will be funded by U.S. Bank's collateral and other assets and will be implemented by a new property manager to be retained by the bank. A full-text copy of U.S. Bank's proposed Chapter 11 plan of reorganization is available for free at: http://bankrupt.com/misc/RCCNorth_USBankDS.pdf About RCC North LLC Scottsdale, Arizona-based RCC North LLC owns and operates two Class A office buildings and the related corporate campuses known as Phase I and Phase II of the Raintree Corporate Center located north of the northeast corner of Loop 101 (Pima Freeway) and Raintree Drive, at 15333 North Pima Road and 15111 North Pima Road, respectively, in Scottsdale, Arizona. The Company filed for Chapter 11 bankruptcy protection on April 15, 2010 (Bankr. D. Ariz. Case No. 10-11078). John J. Hebert, Esq., Mark W. Roth, Esq., and Philip R. Rudd, Esq. at Polsinelli Shughart PC represent the Debtor in its restructuring effort. The Company estimated its assets and debts at $50 million to $100 million in its Chapter 11 petition. RCI REGIONAL: Case Summary & 2 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: RCI Regional Grove, LLC One BetterWorld Circle, Suite 300 Temecula, CA 92590 Bankruptcy Case No.: 11-22055 Chapter 11 Petition Date: April 12, 2011 Court: U.S. Bankruptcy Court Central District of California (Riverside) Judge: Scott C. Clarkson Debtor's Counsel: Ron Bender, Esq. LEVENE, NEALE, BENDER, YOO & BRILL LLP 10250 Constellation Boulevard, Suite 1700 Los Angeles, CA 90067 Tel: (310) 229-1234 E-mail: rb@lnbrb.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Paul Garrett, president of Redhawk Communities, Inc., sole member. Debtor's List of two Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Garrett Real Estate Services -- $1,639 One BetterWorld Circle, Suite 300 Temecula, CA 92590 City of Garden Grove -- $896 11222 Acacia Parkway P.O. Box 3070 Garden Grove, CA 92842-3070 RICHFIELD 81: Judge Massey Rejects Debtor's Dirt-For-Debt Plan -------------------------------------------------------------- WestLaw reports that valuation evidence presented by a Chapter 11 debtor, including expert testimony based on allegedly comparable sales conducted more than one year earlier, was insufficient to show that the debtor's dirt-for-debt plan, under which a portion of the undeveloped real property securing a creditor's claim was to be surrendered to it in full satisfaction of its claim, would provide the creditor with the indubitable equivalent of its claim. Thus, the plan could not be "crammed down" over the creditor's objection. The expert provided no information as to how long it took these alleged comparables to sell or whether the creditor could sell land that was to be surrendered in a reasonable time. A secured creditor's ability to liquidate fairly quickly the illiquid property that is to be distributed to it under a plan is a most important consideration in the court's "indubitable equivalence" analysis. In re Richfield 81 Partners II, LLC, --- B.R. ----, 2011 WL 1345563 (Bankr. N.D. Ga.). The Honorable James E. Massey entered his Order (Doc. 84) denying the Debtor's request to value property securing a $1.4 million loan from SunTrust Bank at $1.6 million on Feb. 8, 2011. Richfield 81 Partners II, LLC, sought chapter 11 protection (Bankr. N.D. Ga. Case No. 10-73883) on May 8, 2010, and is represented by James L. Paul, Esq. -- jimmy.paul@chamberlainlaw.com -- at Chamberlain, Hrdlicka, White, Williams & Martin, in Atlanta, Ga. RK HOSPITALITY: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: RK Hospitality, LLC dba Days Inn & Suites-Bentonville 1709 SE Sunrise Street Bentonville, AR 72712 Bankruptcy Case No.: 11-71720 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court Western District of Arkansas (Fayetteville) Debtor's Counsel: Stanley V. Bond, Esq. BOND LAW OFFICE P.O. Box 1893 Fayetteville, AR 72701-1893 Tel: (479) 444-0255 Fax: (479) 444-7141 E-mail: attybond@me.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/arwb11-71720.pdf The petition was signed by Kuldeep K Chawla, manager. SATELITES MEXICANOS: Wants Ernst & Young as Financial Advisor ------------------------------------------------------------- Satelites Mexicanos, S.A., de C.V., et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Ernst & Young LLP as financial advisor, nunc pro tunc to the Petition Date. E&Y will, among other things: a. develop communication plans for various constituents; b. assist the management and the Debtors' counsel with respect to bankruptcy implementation, including but not limited to the preparation of the information required in the schedule of financial affairs and the statements of assets and liabilities and the development of process for production of monthly operating reports; c. design and prepare a 13-week liquidity management/cash flow template/tool that incorporates detailed sources and uses of cash; and d. assist with the preparation of a liquidation analysis to produce an illustrative summary of potential recoveries under various scenarios. E&Y will be paid based on the hourly rates of its professionals: Partner/Principal $650-$700 Senior Manager $500-$550 Manager $375-$400 Senior/Staff $200-$325 To the best of the Debtors' knowledge, E&Y is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Satmex SAB Satelites Mexicanos, S.A. de C.V., (Satmex) is a Mexico-based provider of fixed satellite services in the Americas, with coverage to more than 90% of the population to the Americas, including more than 45 nations and territories. Satmex also provides Latin American television programming in the United States. One of only two privately managed FSS providers based in Latin America, Satmex has a fleet comprised of three satellites. Satmex 5 and Satmex 6 generate the adjusted EBITDA for Satmex. A third satellite, Solidaridad 2, is inclined orbit but does not generate any adjusted EBITDA. Construction of Satmex 8 is expected to be completed by July 2012. Satmex also intends to pursue plans for a new satellite, to be named Satmex 7. Satmex filed for Chapter 11 bankruptcy protection on April 6, 2011 (Bankr. D. Del. Case No. 11-11035). Affiliates Alterna'TV International Corporation (Bankr. D. Del. Case No. 11-11034) and Alterna'TV Corporation (Bankr. D. Del. Case No. 11-11033) simultaneously filed separate Chapter 11 petitions. Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, serves as the Debtor's bankruptcy counsel. Lazard Freres & Co. LLC is the Debtors' investment banker. Rubio Villegas & Asociados, S.C., serves as the Debtors' special Mexican corporate and regulatory counsel. Epiq Bankruptcy Solutions is the Debtors' claims and notice agent. Jefferies & Company, Inc., is the financial advisor to supporting 2nd lien noteholders. Ropes & Gray LLP is the U.S. counsel to supporting 2nd lien noteholders. Cervantes Sainz serves as Mexican counsel to supporting 2nd lien noteholders. Dechert LLP is the U.S. counsel to supporting holders of first priority notes. Galicia Abogados, S.C., is the Mexican counsel to supporting holders of first priority notes. Bracewell & Giuliani LLP is the U.S. counsel to Series B. Directors. Kuri Brena Sanchez Ugarte Y Aznar is Mexican counsel to Series B. Directors. Morgan, Lewis & Bockius LLP is the U.S. counsel for SCT for Mexico Government. Casares, Castelazo, Frias, Tenorio Y Zarate, SC, is the Mexican counsel for SCT for Mexico Government. Detente Group is the financial advisor for SCT for Mexico Government. Latham & Watkins LLP is the U.S. counsel to Jefferies Finance. Creel, Garcia-Cuellar, Aiza Y Enriquez is the Mexican counsel for Jefferies. In its schedules, Satmex disclosed $393,427,253 in total assets and $457,699,978 in total debts. SATELITES MEXICANOS: Wants Lazard Freres as Investment Banker ------------------------------------------------------------- Satelites Mexicanos, S.A. de C.V., et al., ask for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Lazard Freres & Co. LLC as investment banker and financial advisor, nunc pro tunc to the Petition Date. Lazard Freres will, among other things: a. review and analyze the Debtors' business, operations and financial projections; b. evaluating the Debtors' potential debt capacity and capital expenditure requirements in light of its projected cash flows; c. assist in the determination of a capital structure for the Debtors; and d. assist in the determination of a range of values for the Debtors on a going concern basis. Lazard Freres will be paid, among other things: a. a monthly fee of $175,000 for the first two months of its engagement, and $150,000 for each additional month of engagement; b. a fee equal to $2 million, payable upon the earlier (i) execution of a binding term sheet by, or similar binding agreement in principle among, a sufficient number of the Debtors' stakeholders to proceed with the implementation of a restructuring, (ii) execution of definitive agreements with respect to a pre-packaged or pre-arranged plan of reorganization by a number of the Debtors' stakeholders as is necessary to bind the Debtors' stakeholders to the plan, and (iii) delivery of binding consents to, or execution of, a prepackaged plan by a number of the Debtors' stakeholders as is necessary to file the plan; and c. a fee equal to $8 million, payable upon consummation of a restructuring. More information on compensation of Lazard Freres is available at the letter agreement, a copy of which is available for free at: http://bankrupt.com/misc/SATELITES_MEXICANOS_letteragreement.pdf J. Blake O'Dowd, managing director of Lazard Freres, assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Satmex SAB Satelites Mexicanos, S.A. de C.V., (Satmex) is a Mexico-based provider of fixed satellite services in the Americas, with coverage to more than 90% of the population to the Americas, including more than 45 nations and territories. Satmex also provides Latin American television programming in the United States. One of only two privately managed FSS providers based in Latin America, Satmex has a fleet comprised of three satellites. Satmex 5 and Satmex 6 generate the adjusted EBITDA for Satmex. A third satellite, Solidaridad 2, is inclined orbit but does not generate any adjusted EBITDA. Construction of Satmex 8 is expected to be completed by July 2012. Satmex also intends to pursue plans for a new satellite, to be named Satmex 7. Satmex filed for Chapter 11 bankruptcy protection on April 6, 2011 (Bankr. D. Del. Case No. 11-11035). Affiliates Alterna'TV International Corporation (Bankr. D. Del. Case No. 11-11034) and Alterna'TV Corporation (Bankr. D. Del. Case No. 11-11033) simultaneously filed separate Chapter 11 petitions. Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, serves as the Debtor's bankruptcy counsel. Ernst & Young LLP is the Debtors' financial advisor. Rubio Villegas & Asociados, S.C., serves as the Debtors' special Mexican corporate and regulatory counsel. Epiq Bankruptcy Solutions is the Debtors' claims and notice agent. Jefferies & Company, Inc., is the financial advisor to supporting 2nd lien noteholders. Ropes & Gray LLP is the U.S. counsel to supporting 2nd lien noteholders. Cervantes Sainz serves as Mexican counsel to supporting 2nd lien noteholders. Dechert LLP is the U.S. counsel to supporting holders of first priority notes. Galicia Abogados, S.C., is the Mexican counsel to supporting holders of first priority notes. Bracewell & Giuliani LLP is the U.S. counsel to Series B. Directors. Kuri Brena Sanchez Ugarte Y Aznar is Mexican counsel to Series B. Directors. Morgan, Lewis & Bockius LLP is the U.S. counsel for SCT for Mexico Government. Casares, Castelazo, Frias, Tenorio Y Zarate, SC, is the Mexican counsel for SCT for Mexico Government. Detente Group is the financial advisor for SCT for Mexico Government. Latham & Watkins LLP is the U.S. counsel to Jefferies Finance. Creel, Garcia-Cuellar, Aiza Y Enriquez is the Mexican counsel for Jefferies. The Debtors disclosed $441.6 million in total assets and $531.6 million in total debts as of March 23, 2011. In its schedules, Satmex disclosed $393,427,253 in total assets and $457,699,978 in total debts. SBARRO INC: Nebraska District Court Issues Show Cause Order ----------------------------------------------------------- District Judge Laurie Smith Camp issued separate orders directing parties in four lawsuits involving Sbarro Inc. as defendant, to show cause why the suits should not be referred to the Bankruptcy Court for the District of Nebraska under NEGenR 1.5(a)(1) and 28 U.S.C. Sec. 157. Under NEGenR 1.5(a)(1), "Upon the filing of a suggestion in bankruptcy, or other notification that a party to a civil case is a debtor in a bankruptcy case, the entire case will be referred to the bankruptcy court of this district for further action." The four lawsuits are: -- Kursat Hamzaoglu, v. Sbarro, Inc., Case No. 8:09CV301 (D. Neb.); -- Charles Alley, v. Sbarro, Inc., Case No. 8:09CV300 (D. Neb.); -- Volkan Soyulmaz, v. Sbarro, Inc., Case No. 8:09CV299 (D. Neb.); and -- Zafer Bulduk, v. Sbarro, Inc., Case No. 8:09CV298 (D. Neb.) A copy of one of the Court's orders is available at http://is.gd/tZ1RIFfrom Leagle.com. About Sbarro Inc. The Sbarro family started its business after moving to Brooklyn, New York, from Naples, Italy, in 1956. Today Sbarro is a leading, global Italian quick service restaurant concept with 5,170 employees, 1,045 restaurants throughout 42 countries, and annual revenues in excess of $300 million. Sbarro Inc. sought bankruptcy protection under Chapter 11 (Bankr. S.D.N.Y. Lead Case No. 11-11527) to eliminate about $200 million in debt. Sbarro disclosed assets of $471 million and debt of $486.6 million as of the Chapter 11 filing. Sbarro said it has reached an agreement with all of its second- lien secured lenders and approximately 70% of its senior noteholders on the terms of a reorganization plan that will eliminate more than half of the Company's total indebtedness. Edward Sassower, Esq., and Nicole Greenblatt, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' general bankruptcy counsel. Rothschild, Inc., is the Debtors' investment banker and financial advisor. PriceWaterhouseCoopers LLP is the Debtors' bankruptcy consultants. Marotta Gund Budd & Dzera, LLC, is the Debtors' special financial advisor. Curtis, Mallet-Prevost, Colt & Mosle LLP serves as the Debtors' conflicts counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims agent. Sard Verbinnen & Co is the Debtors' communications advisor. SEA TURTLE: Wells Fargo Buys Shopping Center for $10-Mil. --------------------------------------------------------- Josh McCann at The Island Packet & The Beaufort Gazette reports that Wells Fargo Bank claimed the Berkeley Place shopping center in Bluffton in a foreclosure auction. The bank, which started foreclosure proceedings against center owner Sea Turtle Entertainment in 2009, was the lone bidder, offering $10 million. According to the report, Sea Turtle Entertainment owed more than $30 million on a $23.5 million loan it obtained in 2007, according to the records. The 24-acre open-air center is home to the Sea Turtle Cinemas movie theater and a collection of shops and restaurants. A few of the center's units had been sold previously and were not affected by the auction, but the theater and much of the center were involved, said Lori Kaylor, managing partner of Sea Turtle Entertainment and vice president of Sea Turtle Cinemas. The Gazette says a judge appointed Faison & Associates, a Charlotte commercial real estate firm, to run the center and try to find a buyer after the bank initiated foreclosure. At the time, the bank said Sea Turtle Entertainment had failed to make monthly payments of more than $155,000 since September 2008 and was accumulating interest at a rate of more than $6,700 per day. Based in Hilton Head Island, South Carolina, Sea Turtle Cinemas, Inc., Sea Turtle Cinemas operates a 45,000 square foot, 12-screen movie theater and is the anchor of Berkeley Place shopping center, which is being operated by Sea Turtle Entertainment, LLC. The Landlord and the Debtor are owned and managed by the same group of individuals and entities. Sea Turtle Cinemas filed for Chapter 11 bankruptcy (Bankr. D. S.C. Case No. 10-03259) on May 4, 2010). Michael W. Mogil, Esq. -- mwmogil@aol.com -- serves as the Debtor's counsel. In its petition, the Debtor estimated both assets and debts as between $1 million and $10 million. SEXY HAIR: Taps Eckert Seamans to Handle Intellectual Property -------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California authorized Sexy Hair Concepts LLC, et al., to employ Eckert Seamans Cherin & Mellott, LLC as special counsel. Eckert's will handle the Debtors' intellectual property portfolio and all matters related thereto. The Debtor also tapped Eckert's services in the Class Action lawsuit - Salon Fad et al., v. L'oreal USA, Inc. et al., Case No. 10-CV-5063- which was initiated in the U.S. District Court of the Southern District of New York. The Class Action plaintiffs alleged, among other things, that Sexy Hair, by virtue of a statement on its packaging, violated the Lanham Act. Eckert will maintain consolidated time records reflecting work performed on behalf of all Debtors, and each Debtor will be jointly and severally liable for all fees and expenses incurred by Eckert. Any services provided by Eckert, solely for the benefit of Midco or Ecoly, will be de minimis and will be incidental to the work performed on behalf of the operating entity, Sexy Hair. It is expected that all funds used to pay Eckert's fees and expenses will come from Sexy Hair's operating cash flow or reorganization because. The hourly rates of Eckert's personnel are: Junior Associates $160 Partners $615 Paralegal/Librarian $150 - $165 Sexy Hair advanced to Eckert a $25,000 prepetition retainer. Eckert did not incur any expenses on behalf of the Debtors, but received monthly compensation prior to the Petition Date of $355,598. As of the Petition Date, the retainer balance is $25,000. Roberta Jacobs-Meadway, a partner at Eckert, assures the Court that the firm is a ?disinterested person? as that term is defined in Section 101(14) of the Bankruptcy Code. Ms. Jacobs-Meadway can be reached at: Roberta Jacobs-Meadway member, board of directors co-chair of the Intellectual Property Group Two Liberty Place 50 South 16th Street, 22nd Floor Philadelphia, PA 19102 Tel: (215) 851-8522 Fax: (215) 851-8383 E-mail: rjacobsmeadway@eckertseamans.com About Sexy Hair Chatsworth, California-based Sexy Hair Concepts, LLC, is an operating company engaged in the development, distribution and marketing of premium quality hair care products and brands. It outsources the production and manufacture of its various lines of premier hair care products and operates from a single facility in Chatsworth, California, that houses its corporate offices and distribution warehouse. It works with several distributors domestically and internationally, but does not maintain any other offices. Sexy Hair filed for Chapter 11 bankruptcy protection on Dec. 21, 2010 (Bankr. C.D. Calif. Case No. 10-25922). According to its schedules, Sexy Hair disclosed $78,000,000 in total assets and $91,141,147 in total debts as of the Petition Date. Sexy Hair's bankruptcy case is jointly administered with those of Ecoly International, Inc., a California corporation, and Luxe Beauty Midco Corporation. Ecoly is the lead case (Bankr. C.D. Calif. Case No. 10-25919). Scott F. Gautier, Esq., at Peitzman, Weg & Kempinsky LLP, serves as Sexy Hair's bankruptcy counsel. CRG Partners Group, LLC is the financial advisor. Imperial capital, LLC is the investment banker. Kurtzman Carson Consultants LLC has been designated as the entity that will tabulate the ballots and prepare the ballot summary in connection with Sexy Hair's proposed Chapter 11 plan. Klee, Tuchin, Bogdanoff & Stern LLP serves as counsel for the Official Committee of Unsecured Creditors. SHARPER IMAGE: To Pay Some Gift-Card Claimholders ------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that customers of Sharper Image Corp. may be paid in full on unused gift cards. After Shaper Image filed under Chapter 11 in February 2008, it allowed customers to use gift cards only for purchases twice the amount of the card. Since then, all the stores were closed and all the assets liquidated. The company never set a bar date for filing claims based on gift cards, even though it says the claims may represent the largest category of priority claims that are entitled to full payment. According to Mr. Rochelle, the remnants of the retailer filed a motion this week setting up a procedure where holders of gift cards may be paid in full. At a May 17 hearing, Sharper Image will ask the judge to authorize spending $60,000 on a media campaign asking former customers to file gift card claims. Customers who provide copies of gift cards will be paid first. If assets remain, customers will be paid who swear they held a gift card if they were unable to produce a copy. Mr. Rochelle notes that the effort to honor gift cards isn't entirely voluntary on Sharper Image's part. The bankruptcy court granted a motion creating a class action on behalf of gift-card holders. About Sharper Image Headquartered in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- was a multi-channel specialty retailer. It operated in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The Company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it was also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The Company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D. Del. Case No. 08-10322). Judge Kevin Gross presides over the case. Harvey R. Miller, Esq., Lori R. Fife, Esq., and Christopher J. Marcus, Esq., at Weil, Gotshal & Manges, LLP, serve as the Company's lead counsel. Steven K. Kortanek, Esq., and John H. Strock, Esq., at Womble, Carlyle, Sandridge & Rice, P.L.L.C., serve as the Company's local Delaware counsel. An official committee of unsecured creditors was appointed in the case. Cooley Godward Kronish LLP is the Committee's lead bankruptcy counsel. Whiteford Taylor Preston LLC is the Committee's Delaware counsel. When the Debtor filed for bankruptcy, it disclosed total assets of $251,500,000 and total debts of $199,000,000. As of June 30, 2008, the Debtor disclosed $52,962,174 in total assets and $39,302,455 in total debts. Sharper Image changed its name to "TSIC, Inc." following the sale of its assets to a group consisting of Gordon Brothers Retail Partners, LLC, GB Brands, LLC, Hilco Merchant Resources, LLC, and Hilco Consumer Capital, LLC. SHOPS AT PRESTONWOOD: Taps Franklin Skierski as Bankruptcy Counsel ------------------------------------------------------------------ The Shops at Prestonwood, LP, asks for authorization from the U.S. Bankruptcy Court for the Northern District of Texas to employ Franklin Skierski Lovall Hayward, LLP, as general bankruptcy counsel. Franklin Skierski can be reached at: Melissa S. Hayward, Esq. Franklin Skierski Lovall Hayward LLP 10501 N. Central Expressway, Suite 106 Dallas, TX 75231 Tel: (972) 755-7104 Fax: (972) 755-7114 E-mail: MHayward@FSLHlaw.com Franklin Skierski will be paid based on the hourly rates of its professionals: Professional Hourly Rate ------------ ----------- Melissa Hayward $315 Robert Johnson $200 Paralegal $150 To the best of the Debtor's knowledge, Franklin Skierski is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About The Shops at Prestonwood Addison, Texas-based The Shops at Prestonwood, LP's primary assets consist of approximately 144 residential townhome lots and an additional 17.170 acres of residential undeveloped land located within the Shops at Prestonwood subdivision in Denton County, Texas. Shops at Prestonwood filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 11-32209) on April 1, 2011. Melissa S. Hayward, Esq., at Franklin Skierski Lovall Hayward LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. SIMIS, INC.: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Simis, Inc. 1409 Sutter Street San Francisco, CA 94109 Bankruptcy Case No.: 11-31373 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court Northern District of California (San Francisco) Judge: Dennis Montali Debtor's Counsel: Ning Yu, Esq. MACDONALD AND ASSOCIATES 221 Sansome Street, 3rd Floor San Francisco, CA 94104 Tel: (415) 362-0449 E-mail: ning@macdonaldlawsf.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/canb11-31373.pdf The petition was signed by Sarit Simayof, officer. SOLOMON DWEK: Court Rules on Chapter 11 Trustee's Suit v. Levy -------------------------------------------------------------- Bankruptcy Judge Kathryn C. Ferguson ruled on a summary judgment motion filed by Morris Levy in the suit, Charles A. Stanziale, JR., as Chapter 11 Trustee of Solomon Dwek, v. Morris Levy, adv. Pro. No. 09-1256 (Bankr. D. N.J.). In March 2003, Solomon Dwek created Berkeley Heights Gas, LLC in the hope of acquiring property that might then be leased to a third party to operate a drug store. On Sept. 15, 2003, BHG entered into a Ground Lease with Walgreen Eastern Co., Inc. On March 24, 2004, BHG amended its Certificate of Formation to reflect that Morris Levy had a 50% interest. Also in March 2004, BHG purchased two adjacent lots in Berkeley Heights, New Jersey. BHG obtained a note and mortgage with First Savings Bank to finance the purchase. Both Messrs. Levy and Dwek personally guaranteed the note. In April 2005, BHG refinanced with GMAC and paid off the mortgage to First Savings Bank. Two days later Mr. Levy transferred his 50% interest in BHG to Mr. Dwek in consideration for $1,096,770 of the loan proceeds, which was paid to him on May 2, 2005. Mr. Stanziale ultimately sold the property in August 2009 for $3,400,309. Judge Ferguson held that Summary Judgment is denied on Counts I and II of the Complaint. Partial summary judgment is granted on Counts III and IV as they pertain to the 2005 transfer. The Trustee has withdrawn Count V (deepening insolvency). A copy of the Court's April 4, 2011 Memorandum Opinion is available at http://is.gd/r8woTgfrom Leagle.com. About Solomon Dwek Several creditors filed an involuntary Chapter 7 bankruptcy petition against Solomon Dwek (Bankr. D. N.J. Case No. 07-11757) on Feb. 9, 2007. On Feb. 13, 2007, SEM filed for voluntary Chapter 11. On Feb. 22, 2007, the Dwek bankruptcy case was converted to Chapter 11 and it was administratively consolidated with the SEM bankruptcy. Charles A. Stanziale, Jr., has been appointed trustee in Mr. Dwek's Chapter 11 bankruptcy. STATION CASINOS: Updated Chapter 11 Case Summary ------------------------------------------------ Debtor: Station Casinos Inc. 1505 South Pavilion Center Drive Las Vegas, NV 89135 Bankruptcy Case No.: 09-52477 Affiliates that simultaneously filed separate Chapter 11 petitions: Entity Case No. ------ -------- Northern NV Acquisitions, LLC 09-52470 FCP MezzCo Parent Sub, LLC 09-52479 Reno Land Holdings, LLC 09-52471 FCP MezzCo Borrower VII, LLC 09-52480 River Central, LLC 09-52472 FCP MezzCo Borrower VI, LLC 09-52481 Tropicana Station, LLC 09-52473 FCP MezzCo Borrower V, LLC 09-52482 FCP Holding, Inc. 09-52474 FCP MezzCo Borrower IV, LLC 09-52483 FCP Voteco, LLC 09-52475 FCP MezzCo Borrower III, LLC 09-52484 Fertitta Partners LLC 09-52476 FCP MezzCo Borrower II, LLC 09-52485 FCP MezzCo Borrower I, LLC 09-52486 FCP MezzCo Parent, LLC 09-52478 FCP PropCo, LLC 09-52487 Type of Business: Station Casinos, Inc., is a gaming and entertainment company that currently owns and operates nine major hotel/casino properties (one of which is 50% owned) and eight smaller casino properties (three of which are 50% owned), in the Las Vegas metropolitan area, as well as manages a casino for a Native American tribe. Station Casinos owns and operates: (i) Palace Station, (ii) Boulder Station, (iii) Texas Station, (iv) Sunset Station, (v) Santa Fe Station Hotel & Casino, (vi) Red Rock, (vii) Fiesta Rancho Casino Hotel, (viii) Fiesta Henderson Casino Hotel, (ix) Wild Wild West, (x) Wildfire Casino, (xi) Wildfire Casino - Boulder Highway, formerly known as Magic Star Casino, (xii) Gold Rush Casino, and (xiii) Lake Mead Casino. On the Web: http://www.stationcasinos.com/ Chapter 11 Petition Date: July 28, 2009 Court: District of Nevada Judge: Gregg W. Zive The Debtors' Legal Counsel: Paul S Aronzon, Esq. Thomas R Kreller, Esq. Samir Parikh, Esq. Adam Moses, Esq. Milbank, Tweed, Hadley & McCloy LLP 601 South Figueroa St. 30th Floor Los Angeles, CA 90017 Tel: (213) 892-4000 Fax: (213) 629-5063 http://www.milbank.com/ Debtors' Regulatory Counsel: Brownstein Hyatt Farber Schreck LLP 100 City Parkway, Suite 1600 Las Vegas, NV 89106-4614 Tel: (702) 382-2101 Fax: (702) 382-8135 http://www.bhfs.com/ Debtors' Local Counsel: Bruce Thomas Beesley, Esq. Laury Macauley, Esq. Lewis and Roca LLP 50 West Liberty Street, Suite 410 Reno, NV 89501 Tel: (775) 823-2900 Fax: (775) 823-2929 http://www.lrlaw.com/ Debtors' Investment Banker: Lazard Freres & Co. LLC 30 Rockefeller Plaza New York, NY 10020 Tel: (212) 632-6000 Fax: (212) 332-5901 http://www.lazard.com/ Debtors' Claims Agent: Kurtzman Carson Consultants LLC 2335 Alaska Avenue El Segundo, CA 90245 Tel: (310) 823-9000 http://www.kccllc.net/ The Debtors' financial condition as of June 30, 2009: Total Assets: $5,725,001,325 Total Debts: $6,482,637,653 Affiliates that sought Chapter 11 protection on April 12, 2011: Debtor Case No. ------ -------- AUBURN DEVELOPMENT, LLC 11-51188 MAGIC STAR STATION, LLC 11-51190 PALACE STATION HOTEL & CASINO, INC. 11-51191 BOULDER STATION, INC 11-51192 PAST ENTERPRISES, INC. 11-51193 RANCHO STATION, LLC 11-51194 CENTERLINE HOLDINGS, LLC 11-51195 SONOMA LAND HOLDINGS, LLC 11-51196 STATION HOLDINGS, INC. 11-51197 CHARLESTON STATION, LLC 11-51198 STN AVIATION, INC. 11-51199 CV HOLDCO, LLC 11-51200 SANTA FE STATION, INC. 11-51201 DURANGO STATION, INC. 11-51202 SC DURANGO DEVELOPMENT, LLC 11-51203 SUNSET STATION, INC. 11-51204 FIESTA STATION, INC. 11-51205 TEXAS STATION, LLC 11-51206 FRESNO LAND ACQUISITIONS, LLC 11-51207 TOWN CENTER STATION, LLC 11-51208 GOLD RUSH STATION, LLC 11-51209 TROPICANA ACQUISITIONS, LLC 11-51210 GREEN VALLEY STATION, INC. 11-51211 VISTA HOLDINGS, LLC 11-51212 GREEN VALLEY RANCH GAMING, LLC 11-51213 INSPIRADA STATION, INC 11-51214 LAKE MEAD STATION, INC. 11-51215 ALIANTE GAMING, LLC 11-51216 LML STATION, LLC 11-51217 ALIANTE HOLDING, LLC 11-51218 ALIANTE STATION, LLC 11-51219 SCI and 17 affiliates that sought bankruptcy protection in 2009 are the subject of jointly administered chapter 11 cases pending before this Court, In re Station Casinos, Inc., Case No. BK 09- 52477. The April 12 Debtors want their cases jointly administered with the SCI Cases. A. Station Casinos' 40 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Law Debenture Trust Company notes unstated as Trustee of the 6.875% Sr. Subordinated Notes due March 2016 which held a $724.3MM unsecured claim as of March 3, 2009 400 Madison Avenue #4 New York, NY 10017 Tel: (646) 747-1252 Fax: (212) 750-1361 Law Debenture Trust Company notes unstated as Trustee of the 6.50% Senior Subordinated Notes due February 2014 which held a $467.2MM unsecured claim as of March 3, 2009 400 Madison Avenue #4 New York, NY 10017 Tel: (646) 747-1252 Fax: (212) 750-1361 Law Debenture Trust Company notes unstated as Trustee of the 6.00% Senior Notes due April 2012 which held a $461.4MM unsecured claim as of March 3, 2009 400 Madison Avenue #4 New York, NY 10017 Tel: (646) 747-1252 Fax: (212) 750-1361 Law Debenture Trust Company notes unstated as Trustee of the 7.75% Senior Notes due Augus 2016 which held a $417.1MM unsecured claim as of March 3, 2009 400 Madison Avenue #4 New York, NY 10017 Tel: (646) 747-1252 Fax: (212) 750-1361 Law Debenture Trust Company notes unstated as Trustee of the 6.625% Sr. Subordinated Notes due March 2018 which held a $309.3MM unsecured claim as of March 3, 2009 400 Madison Avenue #4 New York, NY 10017 Tel: (646) 747-1252 Fax: (212) 750-1361 Fedility Management & notes unstated Research Co. Oaktree Capital Management notes unstated Western Asset Management Co notes unstated Goldman Sachs Asset notes unstated Management LP Franklin Templeton Investments notes unstated MFS Investment Management notes unstated Prudential Investment notes unstated Management Pacific Investment Management notes unstated Co. Northwest Investment notes unstated Management Barclays Capital notes unstated Nomura Asset Management Co. notes unstated Ltd. Serengeti Asset Management notes unstated Lord Abbet & Co. LLC notes unstated AllianceBernstein LP notes unstated Metropolitan Life Insurance notes unstated Co. PPM America Inc. notes unstated Dreman Value Management LLC notes unstated Bridge Capital notes unstated Trust & Custody Services notes unstated Bank Ltd. CS Securties USA notes unstated Morgan Stanley Investment notes unstated Management AEGON USA Investment notes unstated Management NY Life International notes unstated GE Asset Management Inc. notes unstated Travelers Companies Inc. notes unstated Eaton Vance Management notes unstated Putnam Investments notes unstated High River LP notes unstated Continental Casualty Co. notes unstated JP Morgan Chase Fixed notes unstated Income Pyramis Global Advisors notes unstated Openheimer Funds Inc. notes unstated Wellington Management notes unstated Columbia Management Advisors notes unstated LLC Babson Capital Management LLC notes unstated B. April 12 Debtors' Consolidated List of 40 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Nevada Gaming Commission Accrued A/P $5,091,361 Tax & License Div. P.O. Box 8004 Carson City, NV 89702-8004 Fertitta Enterprises Deposit - Fertitta $2,925,000 P.O. Box 27555 Gaming Las Vegas, NV 89126-1555 I.G.T. Accrued A/P $1,451,202 Dept 7866 Los Angeles, CA 90088-7866 Nevada Power Company Accrued A/P Trade $1,226,461 dba NV Energy P.O. Box 30086 Reno, NV 89520-3086 Nevada Department of Taxation NV Modified $1,215,272 1550 E. College Parkway, Suite 115 Business Tax Carson City, NV 89710 Internal Revenue Service Accounts Payable $1,055,480 P.O. Box 9949 Ogden, UT 84409 U.S. International Media Accrued Advertising $941,842 1201 Alta Loma Road Los Angeles, CA 90069 State of Nevada Employment Accounts Payable $670,444 Security 500 E. Third Street Carson City, NV 89713-0030 Clark County Business License Notes Payable - $540,358 Department Other P.O. Box 551810 Las Vegas, NV 89155-1810 WMS Gaming Inc. Accrued Other $481,135 Receipts 23571 Network Place Chicago, IL 60673-1235 Findlay Chevrolet Accrued A/P Trade $332,362 6800 S. Torrey Pines Drive Las Vegas, NV 89118 US Foodservice of Nevada Accrued A/P Trade $254,827 P.O. Box 3911 Las Vegas, NV 89127 Shell Energy North America (US), Accrued A/P Trade $219,662 L.P. Mission Industries #44 Accounts Payable $207,510 Las Vegas Review Journal Accrued Other - $207,370 Advertising Terry Downey (Severance) Accrued Other $171,992 Dreschler, Cookie Accrued Other $169,464 Cintas Corporation Accrued A/P $168,658 Principal Financial Group Accrued A/P Trade $164,888 I.G.T Megajackpot Fund Accounts Payable $159,791 Tedesco, Robert Front Money/ $146,000 Safekeeping Hospitality Network, Ltd. Accrued A/P $144,324 Ernst & Young LLP - LA Accrued A/P $132,678 Nevada Department of Taxation - NV Modified $130,764 Bus Tax Business Tax MDC Restaurant's, LLC Accrued A/P $127,040 dba Denny's/Coco's Olympus Construction, Inc. Accrued A/P Trade $123,813 Williams Gaming, Inc. Accounts Payable $121,517 Southwest Gas Advanced Deposits $107,599 Western Money Systems Accrued A/P Trade $107,189 Lamar Companies, The - LA Accrued A/P Trade $106,205 Young Electric Sign Company Accrued A/P Trade $104,008 Bally Gaming & Systems Accrued A/P Trade $100,921 Teems, Edward Front Money/ $100,000 Safekeeping NCV Vending Services Accrued A/P $99,350 Zaxby's Spring Advanced Deposits $97,720 State Restaurant Equipment Other Payable $92,717 Fatburger (Comps) Accrued A/P Trade $91,999 American Express - Corp CPC Accrued A/P Trade $84,075 Pyatt & Silvestri & Hanlon Accrued A/P Trade $81,980 Color Reflections Accrued Advertising $79,299 SUNVALLEY SOLAR: Posts $184,400 Net Loss in June 30 Quarter ----------------------------------------------------------- Sunvalley Solar, Inc., filed on April 8, 2011, Amendment No. 1 to its quarterly report for the quarter ended June 30, 2010. The Company reported a net loss of $184,389 on $1.3 million of revenues for the three months ended June 30, 2010, compared with a net loss of $25,040 on $1.2 million of revenues for the same period of 2009. At June 30, 2010, the Company's balance sheet showed $3.6 million in total assets, $3.8 million in total liabilities, and a stockholders' deficit of $167,345. "We have experienced recurring losses from operations and had an accumulated deficit of $844,126 as of June 30, 2010," the Company said in the filing. "The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern." A complete text of the Form 10-Q/A is available for free at: http://is.gd/GPUOTY Walnut, California-based Sunvalley Solar, Inc., is focused on developing its expertise and proprietary technology to install residential, commercial and governmental solar power systems. The Company's customers range from small private residences to large commercial solar power users. TASTY BAKING: Incurs $45.18 Million Net Loss in 2010 ---------------------------------------------------- Tasty Baking Company filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K reporting a net loss of $45.18 million on $171.67 million of net sales for the 52 weeks ended Dec. 25, 2010, compared with a net loss of $3.39 million on $180.56 million of net sales for the 52 weeks ended Dec. 26, 2009. The Company's balance sheet at Dec. 25, 2010 showed $153.84 million in total assets, $170.82 million in total liabilities and $16.98 million in shareholders' deficit. PricewaterhouseCoopers LLP, in Philadelphia, Pennsylvania, noted that that the Company's cumulative losses, substantial indebtedness that is due June 30, 2011, in addition to its current liquidity situation, raise substantial doubt about its ability to continue as a going concern. A full-text copy of the Annual Report is available for free at: http://is.gd/GIk97A About Tasty Baking Company Tasty Baking Company (NasdaqGM: TSTY) -- http://www.tastykake.com/ -- founded in 1914 and headquartered in Philadelphia, Pa., is one of the country's leading bakers of snack cakes, pies, cookies, and donuts. The company has manufacturing facilities in Philadelphia and Oxford, Pa. The company offers more than 100 products under the Tastykake brand name. As of Sept. 25, 2010, the Company had $185,504,000 in total assets and $169,743,000 in total liabilities. Forbearance Agreement, Going Concern Doubt On Jan. 5, 2011, Tasty Baking obtained initial two-week waiver agreements from several of its creditors, which waived certain payments that were due and certain financial covenant requirements. The Company said it was experiencing extremely tight liquidity due to (i) certain production difficulties during the optimization of its new Philadelphia bakery that caused the Company to not achieve the expected operational cash savings from this bakery during the fourth quarter of 2010; (ii) the impact of the recent bankruptcy filing by The Great Atlantic & Pacific Tea Company, Inc.; and (iii) a sharp rise in commodity costs. At the conclusion of the two-week waiver period, on Jan. 14, 2011, the Company entered into arrangements with certain creditors, including: (i) a Seventh Amendment to the Company's Bank Credit Facility; (ii) a Forbearance and Amendment Agreement with the PIDC Local Development Corporation, which also included a new $2 million loan from PIDC; (iii) a letter agreement with the Machinery and Equipment Fund of the Department of Community and Economic Development of the Commonwealth of Pennsylvania, along with a new $1 million loan from MELF; and (iv) a letter agreement with the Company's landlords at the Philadelphia Navy Yard for its bakery and offices. Also on Jan. 14, 2011, the Company issued $3.5 million of unsecured 12% promissory notes due Dec. 31, 2011 to a group of accredited investors. The Creditor Amendments generally permit the Company to delay certain payments to PIDC, MELF and Liberty Property until June 30, 2011. The Creditor Amendments also generally provide that the creditor will waive certain specified defaults, but not any other defaults that may occur in the future that are not specifically waived in the Creditor Amendments. In addition, the Bank Amendment, among other things, (i) changed the maturity date of the Bank Credit Facility to June 30, 2011; (ii) reduced the letter of credit limit to the aggregate amount of letters of credit currently outstanding, while not permitting the Company to issue new letters of credit or extend outstanding letters of credit; and (iii) set new financial covenants, a breach of which could cause a default to occur prior to June 30, 2011. The Bank Amendment also required that the Company engage in a process -- pursuant to an agreed upon timeline with milestones -- to consummate a sale of the Company before June 30, 2011 in an amount sufficient to pay all obligations of the Company under the Bank Credit Facility and all transaction costs. The Company has delayed the filing of its 2010 annual report on Form 10-K. The Company anticipates that the Form 10-K for fiscal year ended Dec. 25, 2010, will include an explanatory paragraph from the Company's independent registered public accounting firm expressing substantial doubt about the Company's ability to continue as a going concern. TAYLOR BEAN: Ex-Chairman Farkas Needs More Money for Defense ------------------------------------------------------------ Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Lee Farkas, former chairman of Taylor Bean & Whitaker Mortgage Corp., is in the second week of a criminal trial for what the government contends was $1.9 billion fraud. Mr. Farkas returned to the bankruptcy court in Jacksonville, Florida, April 12 by filing a motion asking for more money to pay for his defense. Mr. Rochelle recounts that in September, the bankruptcy court allowed $3 million from a directors' and officers' insurance policy to be used in defense costs for Mr. Farkas and two other indicted executives. Two took guilty pleas. Mr. Farkas didn't. He sought a delay in the trial and failed. According to the report, Mr. Farkas said in a court filing that his $1 million has been exhausted. He wants the bankruptcy judge either to let him use the entire $5 million policy or utilize the reminder of the $2 million not spent by colleagues who pleaded guilty. Plan Hearing Up in Air Mr. Rochelle reported last week that Taylor Bean & Whitaker Mortgage Corp. requested a fourth adjournment of the hearing for confirmation of the Chapter 11 plan. Although it reported "significant progress," the Company deferred a hearing scheduled for last week in view of "complex issues" that remain. According to Mr. Rochelle, the Disclosure Statement says assets to be administered under the Plan eventually will total from $322 million to $521 million. After claims with higher priority are paid, between $264 million and $354 million will remain to pay unsecured creditors, which hold more than $8 billion in claims. Unsecured creditors are expected recover between 3.3% and 4.4%, according to the Disclosure Statement. As reported in the Troubled Company Reporter on Sept. 27, the Plan proposed by the Debtor and the Official Committee of Unsecured Creditors contemplates the formation of a single liquidating trust for the benefit of creditors, which will succeed to all assets of the Debtors. The Plan trustee will, among other things, liquidate the non-cash assets transferred to the plan trust, reconcile claims against the Debtors, make distributions to holders of allowed claims, and wind down the Chapter 11 cases and the Debtors' respective estates. In addition, the Plan provides for the establishment of a cash reserve for disputed claims within any particular class. The process of distributing cash under the Plan will be completed over time. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/TaylorBean_DS.pdf About Taylor Bean Taylor, Bean & Whitaker Mortgage Corp. grew from a small Ocala- based mortgage broker to become one of the largest mortgage bankers in the United States. In 2009, Taylor Bean was the country's third largest direct-endorsement lender of FHA-insured loans of the largest wholesale mortgage lenders and issuer of mortgage backed securities. It also managed a combined mortgage servicing portfolio of approximately $80 billion. The company employed more that 2,000 people in offices located throughout the United States. Taylor Bean sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 09-07047) on Aug. 24, 2009. Taylor Bean filed the Chapter 11 petition three weeks after federal investigators searched its offices. The day following the search, the Federal Housing Administration, Ginnie Mae and Freddie Mac prohibited the company from issuing new mortgages and terminated servicing rights. Taylor Bean estimated more than $1 billion in both assets and liabilities in its bankruptcy petition. Jeffrey W. Kelly, Esq., and J. David Dantzler, Jr., Esq., at Troutman Sanders LLP, in Atlanta, Ga., and Russel M. Blain, Esq., and Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain & Prosser, PA, in Tampa, Fla., represent the Debtors. Paul Steven Singerman, Esq., and Arthur J. Spector, Esq., at Berger Singerman PA, in Miami, Fla., represent the Committee. BMC Group, Inc., serves as the claims and noticing agent. TENET HEALTHCARE: Sues CHS for Disclosing False Statements ---------------------------------------------------------- Tenet Healthcare Corporation filed a lawsuit against Community Health Systems, Inc., its Chairman and Chief Executive Officer, Wayne T. Smith, and its Chief Financial Officer, W. Larry Cash, in the United States District Court for the Northern District of Texas. The action seeks to compel CHS to disclose fully its practice of systematically admitting, rather than observing, patients in CHS hospitals for financial, rather than clinical, purposes. Robert C. Walters, Esq., at Gibson, Dunn & Crutcher LLP, in Dallas, Texas, attorney for Tenet Healthcare, says Tenet's shareholders are at risk of being harmed by false and misleading statements and omissions by CHS, a company whose financial performance has, for many years, been driven by the improper and undisclosed practice of systematically admitting patients into CHS hospitals despite no clinical need. According to Mr. Walters, CHS's practice of greatly underusing "observation" status and consequently overusing "inpatient admission" status has served to overstate its growth statistics, revenues, and profits, and has created a substantial undisclosed financial and legal liability to the federal government, numerous state governments, private insurance companies, and patients. "By failing to disclose its improper business practices and substantial liabilities, CHS has made false and misleading statements and material omissions to its own shareholders," Mr. Walters asserts. "Now, as CHS attempts to acquire Tenet for $6.00 per share, $1.00 of which would be paid in CHS stock to Tenet's shareholders, CHS is making false and misleading statements to Tenet's shareholders in the hope that they will exert pressure upon Tenet to accept an inadequate offer, or elect CHS-nominated directors who will approve a transaction with CHS," he adds. Mr. Walters tells the Court that this improper admissions practice, which sets CHS apart from other peer hospital groups in the country, allowed CHS to receive approximately $280 million to $377 million, between 2006 and 2009, by treating Medicare patients on an admitted inpatient basis who should have been treated in observation. As a result, Mr. Walters notes, CHS has been paid by Medicare, and likely state Medicaid programs, private insurance companies, and other payers, untold hundreds of millions -- if not billions -- of dollars for unnecessary hospital admissions. Mr. Walters relates CHS may well be subject to liability and damages of well over $1 billion for its practices during the 2006-2009 period, not to mention damages to other payers and to the tens of thousands of patients who should never have been admitted as inpatients in CHS hospitals. About Tenet Healthcare Dallas, Texas-based Tenet Healthcare Corporation (NYSE: THC) -- http://www.tenethealth.com/-- is a health care services company whose subsidiaries and affiliates own and operate acute care hospitals, ambulatory surgery centers and diagnostic imaging centers. The Company's balance sheet at Dec. 31, 2010, showed $8.50 billion in total assets, $6.68 billion in total liabilities, and $1.82 billion in total equity. * * * As reported by the TCR on Aug. 5, 2010, Moody's Investors Service affirmed its 'B2' corporate family rating for Tenet. The rating reflects Moody's expectation that the Company will likely see positive free cash flow for the full year ending Dec. 31, 2010, as operating results continue to improve and litigation settlement payments end in the third quarter. However, the ratings also consider the significant headwinds facing the company, and the sector as a whole, with respect to increasing bad debt expense, weak volume trends and changes in mix as commercial volumes decline. S&P's corporate credit rating on Tenet is 'B' and remains unchanged. The ratings agency noted that while the Company has experience recent successes to date of a multiyear turnaround effort, the Company has a still-weak business risk profile and high financial leverage. Fitch Ratings has issued its Recovery Rating review of the U.S. Healthcare sector. This review includes an analysis of valuation multiples, EBITDA discounts applied, and detailed recovery worksheets for issuers with a Fitch Issuer Default Rating of 'B+' or lower in this sector. Fitch Ratings has placed Tenet Healthcare Corp.'s ratings on Rating Watch Positive. Tenet's existing ratings are Issuer Default Rating 'B-'; Secured bank facility 'BB-/RR1'; Senior secured notes 'BB-/RR1'; Senior unsecured notes 'B/RR3. The ratings apply to approximately $4.3 billion of debt outstanding as of Sept. 30, 2010. TERRA BENTLEY II: Summary Judgment Bid in Avoidance Suit Denied --------------------------------------------------------------- Terra Bentley II, LLC, v. Village of Overland Pointe, LLC, Adv. Pro. No. 09-6099 (Bankr. D. Kans.), seeks to avoid certain transfers and other actions that affected its rights in a real estate development it was involved in with the Defendant. The Debtor has filed a motion for summary judgment on all its claims, contending that its adoption and the local government's approval of a development plan and plat for the property, the sale of one lot in the development to Village, and the recording of a declaration of covenants and restrictions were all fraudulent transfers that it can avoid under Kansas state law and the Bankruptcy Code. Village responds that the Debtor's claims all fail, or at least that there are genuine issues of material fact that preclude resolving the claims by summary judgment. In his April 6, 2011 Opinion, available at http://is.gd/wPVf0B from Leagle.com, Bankruptcy Judge Dale L. Somers held that the Debtor's effort to avoid the adoption of the development plan and plat is barred as a matter of law by a state court judgment entered before the Debtor filed for bankruptcy, and that Village is correct that genuine issues of material fact preclude granting summary judgment on the Debtor's effort to avoid the sale of the lot and the recording of the declarations. Terra Bentley II, LLC filed a Chapter 11 bankruptcy petition (Bankr. D. Kans. Case No. 09-23107) on Sept. 18, 2009. The Debtor is represented by James F.B. Daniels, Esq., at McDowell Rice Smith & Buchanan. According to the schedules, the Company has assets of at least $4,564,588, and total debts of $7,608,849. TEXSTYLE, LLC: Files for Chapter 11, Weighed Down by Payables ------------------------------------------------------------- TexStyle, LLC, doing business as TexStyle Home Fashions, filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 11-11686) on April 12 in Manhattan. In its schedules, the Debtor disclosed $7.6 million in assets and debt of $13.8 million. TexStyle, a designer and marketer of home textiles, said it owes $2.8 million to Wells Fargo Bank NA, the secured lender. A total of $1.5 million in secured debt is owing to insiders. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the New York-based company blamed the filing on the "global economic recession" and "significant payables" left over from the acquisition of TexStyle in September. Revenue in 2010 was $16 million. Losses exceeded $4 million, a court papers said. The Walmart.com Web site is responsible for $100,000 a month in sales, according to a filing. TEXSTYLE, LLC: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: TexStyle, LLC dba TexStyle Home Fashions 11 Penn Plaza, 5th Floor New York, NY 10001 Bankruptcy Case No.: 11-11686 Chapter 11 Petition Date: April 12, 2011 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Judge: Stuart M. Bernstein Debtor's Counsel: Adam L. Rosen, Esq. SILVERMAN ACAMPORA LLP 100 Jericho Quadrangle, Suite 300 Jericho, NY 11753 Tel: (516) 479-6300 Fax: (516) 479-6301 E-mail: filings@spallp.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Guyer R. McCracken, chief operating officer. T.H. PROPERTIES: Can Complete 600 Homes Under BoA Lending Deals --------------------------------------------------------------- The Philadelphia Business Journal reports that lending agreements with Bank of America and other institutions will allow T.H. Properties to complete more than 600 homes spread over two communities in Montgomery County. According to the report, the agreements cover 106 homes at the Biltmore Estates in Skippack and 514 homes at Northgate in Upper Hanover Township. Both communities include a mix of single-family and multi-unit buildings. About T.H. Properties Philadelphia-based T.H. Properties, L.P., has 12 working developments in Pennsylvania and New Jersey. Timothy Hendricks and his brother Todd started the firm in 1992. T.H. Properties and its affiliates filed for Chapter 11 bankruptcy protection on April 30, 2009 (Bankr. E.D. Pa. Case No. 09-13201). Northgate Development Company, LP (Bankr. E.D. Calif. Case No. 09-____) was among the affiliates that filed. Barry E. Bressler, Esq., at Schnader, Harrison, Segal & Lewis, LLP, and Natalie D. Ramsey, Esq., at Montgomery McCracken Walker and Rhoads LLP, represent the Debtors in their restructuring efforts. T.H. Properties estimated assets between $100 million and $500 million, and debts between $10 million and $50 million in its Chapter 11 petition. A creditors' committee has been appointed in the Debtors' chapter 11 proceedings. Affiliate Wynstone Development Group, LP (Bankr. E.D. Calif. Case No. 10-17863) filed for Chapter 11 protection on Sept. 14, 2010. It estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. TRIBUNE CO: Modifies Plan to Address Noteholders Objection ---------------------------------------------------------- Tribune Co.; the Official Committee of Unsecured Creditors; Oaktree Capital Management, L.P.; Angelo, Gordon & Co., L.P.; and JPMorgan Chase Bank, N.A. submitted to Judge Carey a modified Second Amended Joint Plan of Reorganization for Tribune Company and its subsidiaries on April 5, 2011. Counsel to the Debtors, Bryan F. Krakauer, Esq., at Sidley Austin LLP, in Chicago, Illinois, says the DCL Plan has been modified to: (i) provide holders of Allowed Senior Noteholder Claims and Allowed Other Parent Claims with the option to elect to receive their distributions either in a strip consideration, comprised of cash, new debt and equity or in cash alone; and (ii) eliminate the release of claims and causes of action against those beneficial owners of Tribune common stock whose shares were purchased by Tribune on or about June 4, 2007 so that these claims can be preserved and prosecuted for the benefit of creditors. These amendments address two of the principal objections to the DCL Plan asserted by Aurelius Capital Management, LP and other noteholders, Mr. Krakauer tells Judge Carey. Based on the Noteholders' view of the equity value of the Debtors, electing the strip distribution option will significantly increase the value of the Senior Noteholders' guaranteed Effective Date recoveries, and preservation of claims against Step One Selling Stockholders will eliminate the Noteholders' objection to the release of those claims. "The DCL Plan offers these benefits while still also preserving the certainty of an all-cash distribution option for those creditors that prefer cash," Mr. Krakauer says. Mr. Krakauer reminds the Court that prior to the amendments, the DCL Plan provided for a fixed cash distribution of about $431 million to the Senior Noteholders and an equivalent percentage recovery in cash for holders of Allowed Other Parent Claims. The Debtors continue to believe that a distribution enterprise value of $6.75 billion is accurate, he notes. However, by adjusting the form of consideration to better suit the Noteholders' preferences, the Debtors offer Aurelius and any other Senior Noteholder that believe the equity value of the Company is higher the option to receive the consideration that they value more highly: a 6.2745% strip of consideration, consisting of pro rata portions of cash, new debt, and equity, in lieu of a cash-only distribution, he points out. At the DCL Plan's $6.75 billion DEV, after taking into account the $120 million in additional value from the Step Two/Disgorgement Settlement, this distribution is equal in value to the cash-only distribution, according to Mr. Stickles. General unsecured creditors of Tribune are also given an equivalent "strip" option. Mr. Krakauer continues that based on the $8 billion DEV used in the Noteholders' Plan, electing this "strip" option over cash would increase the value of the Noteholders' guaranteed Effective Date recoveries from $431 million to $509.5 million. The $90 million "first dollars" that they will receive out of litigation and creditors' trust recoveries and their 65% share of the residual trust distributions provides additional settlement value, regardless of whether cash or the "strip" is elected. If aggregate trust recoveries are conservatively estimated at $300 million, Senior Noteholders would recover an additional $204.9 million, bringing their aggregate recovery to $714.4 million, Mr. Krakauer relates. The Debtors prepared a chart illustrating recoveries to the Senior Noteholders under the scenarios at both the DCL Plan and at the illustrative DEV used in the Noteholders' Plan, in each case plus $120 million from the Step Two/Disgorgement Settlement: Senior Noteholder Recoveries In Millions Amended Debtors' Plan (Assuming Amended $300MM in Natural Debtors' Debtors' Trust Recovery Plan Plan Recoveries) -------- -------- -------- ----------- Notes$ Notes% Notes$ Notes% Notes$ Notes% Notes$ Notes% DEV Recovery Rec. Rec. Rec. Rec. Rec. Rec. Rec. --- ------ ------ ------ ------ ------ ------ ------ ------ $6.75 $61.6 4.80% $431 33.59% $431 33.58% $636 49.57% Bil. $8 $63.4 4.94% $431 33.59% $509.5 39.71% $714.4 55.68% Bil. The Noteholders have objected to the release of claims against Step One Selling Stockholders in the previous version of the DCL Plan. The Debtors have resolved this objection by removing those releases, claims against Step One Selling Stockholders for the disgorgement of amounts received in connection with Tribune's 2007 leveraged buyout will now be preserved, Mr. Krakauer discloses. As with all other preserved claims, a disproportionate share of any recoveries on these claims will be distributed to Senior Noteholders and other non-LBO creditors, he explains. If the Noteholders stand by their $8 billion DEV, the amendments set forth in the DCL Plan substantially increase the value of distributions offered to non-LBO creditors under the DCL Plan, Mr. Krakauer relates. Due to the change in the form of consideration provided to the Senior Lenders, the Debtors believe that it would be prudent to resolicit the Senior Lender Claim. Thus, the Debtors intend to file with the Court a motion seeking approval of a resolicitation of Senior Noteholders and Holders of Other Parent Claims to allow them to elect the new treatment option they prefer will also be necessary. A three-part copy of the DCL Plan dated April 5, 2011 in three parts is available for free at: http://bankrupt.com/misc/Tribune_Apr5DebtorsPlan01.pdf http://bankrupt.com/misc/Tribune_Apr5DebtorsPlan02.pdf http://bankrupt.com/misc/Tribune_Apr5DebtorsPlan03.pdf A three-part blacklined copy of the DCL Plan in three parts is available for free at: http://bankrupt.com/misc/Tribune_Apr5PlanPart1_blacklined.pdf http://bankrupt.com/misc/Tribune_Apr5PlanPart2_blacklined.pdf http://bankrupt.com/misc/Tribune_Apr5PlanPart3_blacklined.pdf March 3 DCL Plan The Debtors filed with the Court on March 3, 2011, a proposed Second Amended Joint Plan of Reorganization. The March 3 Plan contains these modifications, including: * The current directors of Tribune will serve on Tribune's board of directors after the confirmation date of the Plan until the Effective Date. The Debtors will file a notice specifying the identity and affiliations of any person proposed to serve on the initial board of directors of Reorganized Tribune from and after the Effective Date. * The insurance policies of the Debtors will continue in effect after the Effective Date pursuant to their terms and conditions and nothing in the Plan documents will relieve any of the Reorganized Debtors from performing their obligations under the Insurance Policies, nor will anything in the Plan Documents relieve any insurer from performing its obligations under the Insurance Policies. A two-part copy of the DCL Plan dated March 3, 2011 in two parts is available for free at: http://bankrupt.com/misc/Tribune_Mar3DebtorsPlan01.pdf http://bankrupt.com/misc/Tribune_Mar3DebtorsPlan02.pdf A two-part copy of the DCL Plan in three parts is available for free at: http://bankrupt.com/misc/Tribune_Mar3DebtorsPlan01_blacklined.pdf http://bankrupt.com/misc/Tribune_Mar3DebtorsPlan02_blacklined.pdf Tribune, et al., Object to Aurelius Plan The Debtors; the Official Committee of Unsecured Creditors; Oaktree Capital Management, L.P.; Angelo, Gordon & Co., L.P.; and JPMorgan Chase Bank, N.A., object to confirmation of the Second Amended Joint Plan of Reorganization for Tribune Company filed by Aurelius Capital Management, L.P., et al. Counsel to the Debtors, Bryan F. Krakauer, Esq., at Sidley Austin LLP, in Chicago, Illinois, tells the Court that the Noteholders have rightly modified their Noteholder Plan to allow Step Two Senior Lenders to receive their initial distributions rather than holding them back. Similarly, the Noteholders' attempt to incorporate the Bridge Settlement into the Noteholder Plan suggests that the Noteholders no longer object to the Bridge Settlement as a component of the DCL Plan, he notes. Those developments narrow the scope of issues in dispute, he relates. However, the amendments in the Noteholder Plan do not achieve the Noteholders' objective of addressing and resolving certain objections to the Noteholder Plan, Mr. Krakauer contends. The changes, he avers, only affect the consideration paid to creditors other than the Noteholders, requiring no concession whatsoever in the consideration the Noteholders provide themselves, or in the size of a Non-LBO Debt Reserve, which will still contain sufficient value to pay all non-LBO creditors in full with four years of postpetition interest. Mr. Krakauer also notes that no settlement with the Bridge Loan Lenders has actually been implemented in the Noteholder Plan. The settlement value provided by the Bridge Loan Lenders increases the recoveries of the Senior Noteholders and holders of Allowed Other Parent Claims, he stresses. "The suggestion that the Bridge Settlement might be grafted onto the Noteholder Plan as a further means of reducing the required equity reserve is simply yet another effort by the Noteholders to have others remedy their Plan's infirmities," he maintains. If implemented, the Amendments would in some ways render the Noteholder Plan less confirmable than its prior version, the Debtors insist. Debtors Defend Witness List, Noteholders Seek to Preclude Witness The DCL Plan Proponents allege that Aurelius Capital Management, LP, et al.'s objection seek to prevent the development of a full record on which the Court may consider the two competing Chapter 11 Plans. Counsel to the Debtors, Matthew B. McGuire, Esq., at Landis Rath & Cobb LLP, in Wilmington, Delaware, argues that the testimony of the Debtors' witnesses responds directly to the evidence presented by the Noteholders through their witnesses. There is also no merit to the Noteholders' claim of surprise concerning the DCL Plan to present rebuttal testimony since the Debtors have consistently and expressly indicated their intention to call rebuttal witnesses if necessary, he adds. In a supplemental objection, the Noteholders insist that Mace Rosenstein, the Debtors' witness, should not be permitted to testify as a rebuttal witness as to any matters that are outside the scope of the Noteholders' witness Mark Prak's testimony, including with respect to FCC "issues under the Noteholder Plan." Creditors' Committee Seeks Resolution of Discovery Matters The telephonic hearing held on April 5 was convened at the request of the Official Committee of Unsecured Creditors to address issues that have arisen with respect to the Plan Confirmation Hearing. In a letter to the Court on April 4, the Creditors' Committee identified six issues related to the ongoing plan discovery: (1) There is a dispute between the Debtors and the Noteholders concerning the rebuttal case the DCL Plan Proponents wish to present and the other points raised by the Noteholders. (2) The Noteholders argue that if the Debtors are permitted to present a rebuttal case, it should begin on Tuesday, April 12, 2011, while the Debtors' rebuttal case should begin on April 11, 2011. (3) In the event that the Debtors are permitted to present rebuttal evidence, the Noteholders seek the right to do so as well, on a date to be scheduled after the Debtors' rebuttal evidence is presented. (4) The Noteholders have requested a short deposition of Professor Bernard Black to be scheduled this week based on the Debtors' representation that they intend to call Professor Black to rebut Professor Rock's expert report addressing corporate governance issues and in the event the Debtors are permitted to offer that rebuttal testimony. (5) Depending on how the Court resolves the disputes concerning the rebuttal case and its commencement date, notice needs to be sent to all other parties regarding whether their legal objections to the competing plans will be heard beginning on April 13, 2011 or April 14, 2011. (6) There is a dispute between the Debtors and the Noteholders concerning whether they should present their legal objections to the competing plans on April 13 or 14 when other parties will present their legal objections, as the Noteholders contend, or defer legal objections until after post-hearing briefs are submitted and present them as part of their closing arguments, as the Debtors contend. The Creditors' Committee believes that resolution of these issues will affect what matters will go forward during the week of April 11. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Sends Caption Colorado Dispute to Arbitration --------------------------------------------------------- Tribune Company or its subsidiaries and Caption Colorado L.L.C. were parties to a certain agreement, dated as of Jan. 3, 2000, for closed captioning services of live programs to certain television stations owned and operated by Tribune. The Agreement provides that unless earlier terminated, it will automatically renew for successive 12-month periods, unless Tribune, the Stations or Caption Colorado, at least 90 days before the end of the initial term or before the end of any extension period, provides written notice to the other party of the intent to terminate the Agreement. The Initial Term of the Agreement terminated on Dec. 31, 2010. Caption Colorado filed a motion asking Judge Kevin Carey to allow it an administrative expense claim for its damages on account of Tribune's breach of the Agreement in the total amount of $1,313,449 plus costs, as permitted by Section 503(b)(1)(A) of the Bankruptcy Code. Tribune Co. and Caption Colorado jointly sought and obtained approval from the Court of a stipulation for the (i) resolution of Caption Colorado's motion to allow administrative claim and (ii) withdrawal of Caption Colorado's objection to the two Plans of Reorganization. The Parties agree to commence an arbitration proceeding to adjudicate and resolve the disputes arising out of the captioning agreement, including, without limitation, the amount of damages, if any, suffered by Caption Colorado on account of the alleged postpetition breach of Tribune Broadcasting Company, on behalf of itself and its subsidiaries, of the Captioning Agreement, pursuant to the Captioning Agreement and applicable non- bankruptcy law and in a non-bankruptcy forum of competent jurisdiction. The results of that arbitration and any subsequent applicable non-bankruptcy proceeding, including the amount of damages, shall be final and binding upon the Parties and the Broadcast Debtors' estates. Notwithstanding any provisions of the plan of reorganization ultimately confirmed by the Court, any ruling or judgment awarding damages to Caption Colorado arising out of the Non- Bankruptcy Proceeding will be deemed an allowed administrative expense claim and shall be paid as provided for in the applicable Confirmed Plan and as required under Section 1129(a)(9)(A) of the Bankruptcy Code. The Administrative Expense Motion will be deemed withdrawn, without prejudice to either of the Parties' rights to file any future pleadings relating to enforcement of the Parties' Stipulation. Similarly, the Confirmation Objection is deemed withdrawn, provided that Caption Colorado's rights to object to any other plan of reorganization that may be proposed in the Debtors' Chapter 11 cases are fully preserved. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08- 13141). The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. And Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) UNILAVA CORPORATION: Incurs $1.00 Million Net Loss in 2010 ---------------------------------------------------------- Unilava Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K reporting a net loss of $1.00 million on $5.31 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $1.81 million on $7.35 million of revenue during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $4.50 million in total assets, $5.35 million in total liabilities and $846,998 in total stockholders' deficit. De Joya Griffith & Company, LLC, in Henderson, Nevada, said that the Company has suffered losses from operations, which raises substantial doubt about its ability to continue as a going concern. The Company has recently sustained operating losses and has an accumulated deficit of $2.38 million at Dec. 31, 2010. In addition, the Company has negative working capital of $4.59 million at Dec. 31, 2010. A full-text copy of the Annual Report is available for free at: http://is.gd/oSt6Vz About Unilava Corporation Unilava Corporation (OTC BB: UNLA)-- http://www.unilava.com/-- is a diversified communications holding company incorporated under the laws of the State of Wyoming in 2009. Unilava Corporation and its subsidiary brands provide a variety of communications services, products, and equipment that address the needs of corporations, small businesses and consumers. The Company is licensed to provide long distance services in 41 states throughout the U.S. and local phone services across 11 states. Through its carrier-grade microwave wireless broadband infrastructure and broadband Internet access partners, the Company also offers mobile and high-definition IP-hosted voice services to residential customers and corporate clients. Additionally, Unilava Corp. delivers a comprehensive and integrated suite of fee-based online and mobile advertising and web services to a broad array of business enterprises. Headquartered in San Francisco, the Company has regional offices in Chicago, Seoul, Hong Kong, and Beijing. UNISYS CORP: Holders Validly Tender $325.83MM of Senior Notes ------------------------------------------------------------- Unisys Corporation announced that its tender offer for its outstanding 14 1/4% Senior Secured Notes due 2015 and 12 3/4% Senior Secured Notes due 2014 expired at 5:00 P.M., New York City time, on April 8, 2011. Holders validly tendered $134,798,000 in aggregate principal amount of the First Priority Notes and $191,033,000 in aggregate principal amount of the Second Priority Notes. In accordance with the terms of the tender offer, the company has accepted for purchase all of the First Priority Notes validly tendered and $44,066,000 in aggregate principal amount of the Second Priority Notes validly tendered. Because the consideration payable for the aggregate principal amount of Notes validly tendered exceeded the maximum payment amount of $220 million, the company accepted the Second Priority Notes for purchase from tendering holders on a pro rata basis, using a proration factor of approximately 23.1%. The company expects to make payment by April 11, 2011, for the Notes accepted for purchase. The complete terms and conditions of the tender offer are described in the Offer to Purchase, dated Feb. 22, 2011, and the related letter of transmittal. As previously announced, the company also recently redeemed $86.3 million in aggregate principal amount of the First Priority Notes and $124.7 million in aggregate principal amount of the Second Priority Notes, using the proceeds from the sale of 2,587,500 shares of its 6.25% Mandatory Convertible Preferred Stock, Series A, at an initial liquidation preference of $100 per share. The annualized dividend on the Mandatory Convertible Preferred Stock will be approximately $16 million until the mandatory conversion date of March 1, 2014. An aggregate principal amount of $25.5 million of the First Priority Notes and an aggregate principal amount of $206.2 million of the Second Priority Notes remain outstanding. Goldman, Sachs & Co. and Citi acted as dealer managers in connection with the tender offer. Questions regarding the tender offer may be directed to Goldman, Sachs & Co. at (212) 902-5183 (collect) or (800) 828-3182 (U.S. toll-free) or to Citigroup Global Markets Inc. at (212) 723-6106 (collect) or (800) 558-3745 (U.S. toll-free). Inquiries may also be directed to Global Bondholder Services Corporation, which served as the information agent and depositary for the tender offer, at (212) 430-3774 (for banks and brokers) or (866) 937-2200 (U.S. toll-free). About Unisys Corp. Based in Blue Bell, Pennsylvania, Unisys Corporation (NYSE: UIS) -- http://www.unisys.com/-- provides a portfolio of IT services, software, and technology that solves critical problems for clients. With more than 26,000 employees, Unisys serves commercial organizations and government agencies throughout the world. As reported by the Troubled Company Reporter on Feb. 24, 2011, Moody's Investors Service has affirmed Unisys' B1 corporate family rating and all other ratings, and also changed the rating outlook to positive from stable. This outlook change follows the announcement by Unisys of plans to issue mandatory convertible preferred stock, redeem secured notes, and tender for additional bonds which Moody' estimates will reduce secured debt by up to $390 million. Upon completion of the transactions, the loss given default assessments will be revised based on the remaining debt balances. VILICA LLC: Files Amended Schedules of Assets and Liabilities ------------------------------------------------------------- Vilica, LLC, has amended its schedules of assets and liabilities, stating: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $6,585,000 B. Personal Property $7,394,670 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $2,866,390 E. Creditors Holding Unsecured Priority Claims 0 F. Creditors Holding Unsecured Non-priority Claims $740,400 ----------- ----------- TOTAL $13,979,670 $3,626,790 Santa Cruz, California-based Vilica, LLC, filed for Chapter 11 bankruptcy protection on December 13, 2010 (Bankr. N.D. Calif. Case No. 10-62728). Stephen T. Davies, Esq., at Turner Litigation Services, serves as the Debtor's bankruptcy counsel. VINOD & SONS: Case Summary & 13 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Vinod & Sons, Inc. 2900 W. International Speedway Boulevard Daytona Beach, FL 32124 Bankruptcy Case No.: 11-02592 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court Middle District of Florida (Jacksonville) Debtor's Counsel: Scott W. Spradley, Esq. LAW OFFICES OF SCOTT W. SPRADLEY PA P.O. Box 1 109 South 5th Street Flagler Beach, FL 32136 Tel: (386) 693-4935 Fax: (386) 693-4937 E-mail: scott.spradley@flaglerbeachlaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 13 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/flmb11-02592.pdf The petition was signed by Bipin Rama, president. VITRO SAB: Court Denies Involuntary Petitions vs. 4 US Units ------------------------------------------------------------ Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Vitro SAB scored another victory this week when a bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. Judge Russell Nelms said the companies were generally paying debts as they come due. Even though they were in default on their guarantees of the bonds, the judge said they have "a meaningful number of third party trade vendors that are being paid." Judge Nelms also noted that the four companies are among almost 50 Vitro affiliates that are liable on guarantees of the notes. Judge Nelms, according to the report, will decide later about the involuntary petitions filed against eight non-operating Vitro subsidiaries in the U.S. Judge Nelms wasn't required to rule on the involuntary petitions against four other Vitro units -- Vitro America LLC and three other U.S. subsidiaries into Chapter 11. -- because they put themselves into Chapter 11 on April 6. They too were facing involuntary petitions filed in November by holders of some of the $1.2 billion of bonds in default for two years. 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 Dec. 7, 2010. 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 Nov. 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 Dec. 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 Dec. 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. Sections 1515 and 1517. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan based on the vote of $1.9 billion of intercompany debt when third-party creditors were opposed. In April, Vitro SAB emerged the victor when an appellate court in Mexico reinstated the prepackaged reorganization the company filed last year under that country's concurso mercantile. WASHINGTON LOOP: U.S. Trustee Asks for Dismissal of Ch. 11 Case --------------------------------------------------------------- Don Walton, the U.S. Trustee for Region 21, asks the U.S. Bankruptcy Court for the Middle District of Florida to dismiss Washington Loop, LLC, a Limited Liability Company's Chapter 11 bankruptcy case or in the alternative convert the case to Chapter 7. The Debtor was dismissed from a prior Chapter 11 case, (Case No. 10-27981) by order of the Court entered on March 17, 2011. In the Debtor's prior Chapter 11 case, the Debtor's Schedule F, as filed under penalty of perjury, listed some 34 general unsecured creditors totaling claims of $1,953,354.42. In that case, the Debtor, under penalty of perjury listed all Schedule F debts and non-contingent, liquidated, and undisputed. In the current Chapter 11 case, the Debtor declares, under penalty of perjury, that all Schedule F debts are unliquidated. These schedules were filed no less than two weeks after the dismissal of the prior Chapter 11 case, and only six weeks after the Debtor filed its Schedule F in that case. The U.S. Trustee would assert that the Debtor won't be able to establish the evidentiary showing that 100% of all of its general unsecured creditors' claims are unliquidated. "It appears that the Debtor's contrary position in this instant case that 100% of all of its general unsecured claims are unliquidated is intentionally motivated to obviate the statutory provision of Section 1111(a), title 11, United States Code," the U.S. Trustee says. As the Court stated in Cluff, the "last minute change of heart appears disingenuous and smacks of manipulation," the U.S. Trustee states. According to the U.S. Trustee, the manipulation is heightened in a "Chapter 11 case juxtaposed to the statutory provision of Section 1111(a) and Fed. R. Bankr. P. 3003." The U.S. Trustee claims that the filing of Schedule F wherein the Debtor scheduled 100% of all of its prepetition general unsecured claims evidences an intent by the Debtor to delay harass, or further frustrate and needlessly increase the costs associated to the creditors and other parties in interest in this bankruptcy case. Punta Gorda, Florida-based Washington Loop, LLC, a Limited Liability Company, filed for Chapter 11 bankruptcy protection on March 31, 2011 (Bankr. M.D. Fla. Case No. 11-06053). Joel S. Treuhaft, Esq., who has an office in Palm Harbor, Florida, serves as the Debtor's bankruptcy counsel. The Debtor was dismissed from a prior Chapter 11 case, (Case No. 9:10-27981) by order of the Court entered on March 17, 2011. In the Debtor's prior Chapter 11 case, the Debtor's Schedule F, as filed under penalty of perjury, listed some 34 general unsecured creditors totaling claims of $1,953,354.42. In that case, the Debtor, under penalty of perjury listed all Schedule F debts and non-contingent, liquidated, and undisputed. The Debtor now declares, under penalty of perjury, that all Schedule F debts are unliquidated. These schedules were filed no less than two weeks after the dismissal of the prior Chapter 11 case, and only six weeks after the Debtor filed its Schedule F in that case. In its schedules, the Debtor disclosed $45,098,259 in total assets and $19,654,992 in total debts as of the Petition Date. WB REAL ESTATE: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: WB Real Estate Revivial, LLC 3520 East Utopia Road Phoenix, AZ 85050 Bankruptcy Case No.: 11-09921 Chapter 11 Petition Date: April 11, 2011 Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtor's Counsel: Mark J. Giunta, Esq. LAW OFFICE OF MARK J. GIUNTA 1413 N. 3rd Street Phoenix, AZ 85004-1612 Tel: (602) 307-0837 Fax: (602) 307-0838 E-mail: mark.giunta@azbar.org Scheduled Assets: $595,412 Scheduled Debts: $1,239,981 A list of the Company's nine largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/azb11-09921.pdf The petition was signed by Richard Boeckmann, managing member. ZALE CORP: Suspending Filing of Reports Under Savings Plan ---------------------------------------------------------- Zale Corporation Savings and Investment Plan filed a Form 15 with the U.S. Securities and Exchange Commission notifying of its suspension of its duty to file reports required under Section 15(d) of the Securities Exchange Act of 1934, as amended. There are currently no holders of records of common stock under the Plan. Zale Corporation common stock, par value $0.01 per share, has been eliminated as an investment option under the Plan. About Zale Corporation Based in Dallas, Texas, Zale Corporation (NYSE: ZLC) -- http://www.zalecorp.com/-- is a specialty retailer of diamonds and other jewelry products in North America, operating approximately 1,900 retail locations throughout the United States, Canada and Puerto Rico, as well as online. Zale Corporation's brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale also operates online at http://www.zales.com/, http://www.zalesoutlet.com/, http://www.gordonsjewelers.com/and http://www.pagoda.com/ Zale reported a net loss of $93.67 million on $1.62 billion of revenues for the year ended July 31, 2010, compared with a net loss of $166.35 million on $1.78 billion of revenues for the same period a year ago. As reported by the Troubled Company Reporter on February 10, 2010, The Deal.com's Sara Behunek reported that analysts said bankruptcy looms for Zale if it fails to restructure its debt and put in place a solid merchandising strategy. The Company's balance sheet at Jan. 31, 2011 showed $1.20 billion in total assets, $960.97 million in total liabilities and $244.01 million in total stockholders' investment. * Gonzalez to Retire From Manhattan Bankruptcy Bench in Feb. 2012 ----------------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Chief Judge Arthur J. Gonzalez of the U.S. Bankruptcy Court for the Southern District of New York will retire from the bench on Feb. 29, 2012. The next day, he will become a senior fellow at the New York University School of Law. Judge Gonzalez was the U.S. Trustee in New York before being appointed a bankruptcy judge in 1995. He presided over the Chapter 11 cases for Enron Corp., WorldCom Inc. and Chrysler Corp. In addition to teaching at NYU, Gonzalez is to be codirector of the NYU's Bankruptcy Workshop and the Galgay Fellows Program. * Grant Thornton LLP to Acquire Portion of LECG Practice -------------------------------------------------------- The Philadelphia office of Grant Thornton LLP on Wednesday announced a final agreement to acquire 19 partners and 164 professionals from the LECG Audit, Tax and Advisory practice. Additional LECG professionals will join Grant Thornton offices in Atlanta, Chicago and New York. Prior to merging with LECG, the portion of the business that Grant Thornton is acquiring was known as Smart Business Advisory and Consulting and was the largest independent accounting firm based in the Philadelphia area. "We are very excited and proud of the outstanding talent that we have added to the Philadelphia office," said Rick Gebert, Philadelphia office managing partner. "This acquisition allows us to further support the firm's goal to be the leading audit, tax and advisory firm serving dynamic organizations in our chosen markets. It also strengthens our already very capable resources in the Pennsylvania market." "This transaction represents a key strategic milestone in the Philadelphia office's response to marketplace opportunities that allow us to deliver truly value-added tax, audit and advisory services to our clients and prospective clients," noted Wayne Kaplan, who will assume the role of Philadelphia office managing partner as of Aug. 1. "It complements and builds upon our talented cadre of professionals who service our chosen markets." About Grant Thornton LLP Grant Thornton LLP -- http://www.GrantThornton.com/-- is the U.S. member firm of Grant Thornton International Ltd, one of the six global audit, tax and advisory organizations. Grant Thornton International Ltd and its member firms are not a worldwide partnership, as each member firm is a separate and distinct legal entity. * Recent Small-Dollar & Individual Chapter 11 Filings ----------------------------------------------------- In Re John McCombs Bankr. S.D. Ala. Case No. 11-01293 Chapter 11 Petition filed March 31, 2011 In Re 83rd Partners LLC dba Prime Pizza Bankr. D. Ariz. Case No. 11-08851 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/azb11-08851.pdf In Re Benjamin Kang Bankr. C.D. Calif. Case No. 11-23910 Chapter 11 Petition filed March 31, 2011 In Re Daniel Rodarte Bankr. C.D. Calif. Case No. 11-23824 Chapter 11 Petition filed March 31, 2011 In Re Gary Bodenweiser Bankr. C.D. Calif. Case No. 11-20789 Chapter 11 Petition filed March 31, 2011 In Re Waheed Akhtar Bankr. E.D. Calif. Case No. 11-27951 Chapter 11 Petition filed March 31, 2011 In Re Alegria Hipolito Bankr. N.D. Calif. Case No. 11-53072 Chapter 11 Petition filed March 31, 2011 In Re Carole Shelton Bankr. N.D. Calif. Case No. 11-11183 Chapter 11 Petition filed March 31, 2011 In Re Escapes Acquisition LLC Bankr. M.D. Fla. Case No. 11-04467 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/flmb11-04467.pdf In Re Mary Henderson Bankr. M.D. Fla. Case No. 11-06181 Chapter 11 Petition filed March 31, 2011 In Re Butler Logging, Inc. Bankr. S.D. Ga. Case No. 11-30148 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/gasb11-30148.pdf In Re Jeffrey Purtle Bankr. D. Kan. Case No. 11-20880 Chapter 11 Petition filed March 31, 2011 In Re Redrye, LLC Bankr. E.D. Mich. Case No. 11-49143 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/mieb11-49143p.pdf See http://bankrupt.com/misc/mieb11-49143c.pdf In Re Extreme Team, A Nevada Corporation aka Barbie Ltd aka Re/Max Extreme Bankr. D. Nev. Case No. 11-14741 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/nvb11-14741.pdf In Re Michael Gallicchio Bankr. D. N.J. Case No. 11-19772 Chapter 11 Petition filed March 31, 2011 In Re New Jersey Lawn and Irrigation, Inc. Bankr. D. N.J. Case No. 11-19928 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/njb11-19928.pdf In Re K.C. Third Avenue Parking LLC Bankr. S.D.N.Y. Case No. 11-11423 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/nysb11-11423.pdf In Re Hickory Grove Express LLC aka Gold Water Development Inc. Bankr W.D. N.C. Case No. 11-30840 Chapter 11 Petition filed March 31, 2011 filed pro se In Re Union Trust Philadelphia, LLC aka Union Trust Steak House Bankr. E.D. Pa. Case No. 11-12565 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/paeb11-12565.pdf In Re WSC 717 Associates, L.P. Bankr. E.D. Pa. Case No. 11-12567 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/paeb11-12567.pdf In Re Lorjes, LLC Bankr. W.D. Pa. Case No. 11-10581 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/pawb11-10581.pdf In Re Elisa Apartments Corporation Bankr. D. Puerto Rico Case No. 11-02830 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/prb11-02830.pdf In Re Mark Skoda Bankr. W.D. Tenn. Case No. 11-23283 Chapter 11 Petition filed March 31, 2011 In Re Freddy's Investments, Inc. dba Proactive Homecare Bankr. S.D. Texas Case No. 11-70201 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/txsb11-70201.pdf In Re New Beginnings Behavioral Health Services, Inc. Bankr. S.D. Texas Case No. 11-70199 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/txsb11-70199.pdf In Re Robert Ruiz Patricia Ruiz Bankr. W.D. Texas Case No. 11-30602 Chapter 11 Petition filed March 31, 2011 In Re Bryan Thorell Bankr. D. Utah Case No. 11-24430 Chapter 11 Petition filed March 31, 2011 In Re Allen Ferguson Bankr. E.D. Va. Case No. 11-32141 Chapter 11 Petition filed March 31, 2011 In Re H&L Hospitality LLC Bankr. D. D.C. Case No. 11-00248 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/dcb11-00248.pdf In Re Ires Investment Group, LP Bankr. W.D. Texas Case No. 11-60384 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/txwb11-60384p.pdf See http://bankrupt.com/misc/txwb11-60384c.pdf In Re Lanphear Tool Works, Inc. Bankr. W.D. Mich. Case No. 11-03675 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/miwb11-03675p.pdf See http://bankrupt.com/misc/miwb11-03675c.pdf In Re Normangee Apartments Ltd. Bankr. W.D. Texas Case No. 11-60383 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/txwb11-60383.pdf In Re Pepperonis Pizza Inc. Bankr. C.D. Calif. Case No. 11-14692 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/cacb11-14692.pdf In Re Pittsburgh National Golf Club, Inc. Bankr. W.D. Pa. Case No. 11-22050 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/pawb11-22050p.pdf See http://bankrupt.com/misc/pawb11-22050c.pdf In Re Ridgerunner, LLC Bankr. D. Idaho Case No. 11-20369 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/idb11-20369.pdf In Re S17 Owners Association, Inc. Bankr. D. S.C. Case No. 11-02194 Chapter 11 Petition filed April 1, 2011 See http://bankrupt.com/misc/scb11-02194.pdf In Re Soccer Pro RC LLC Bankr. N.D. Calif. Case No. 11-31251 Chapter 11 Petition filed March 31, 2011 See http://bankrupt.com/misc/canb11-31251.pdf In Re Edward Byington Bankr. W.D. Va. Case No. 11-70729 Chapter 11 Petition filed April 1, 2011 In Re Huu Tieu Bankr. C.D. Calif. Case No. 11-14686 Chapter 11 Petition filed April 1, 2011 In Re Jacob Jones Bankr. M.D. Fla. Case No. 11-02406 Chapter 11 Petition filed April 1, 2011 In Re Jeffrey Geftos Cynthia Geftos Bankr. E.D. Mich. Case No. 11-49372 Chapter 11 Petition filed April 1, 2011 In Re Jose Hernandez Bankr. S.D. Texas Case No. 11-32749 Chapter 11 Petition filed April 1, 2011 In Re Leonor Zimerman Bankr. C.D. Calif. Case No. 11-14045 Chapter 11 Petition filed April 1, 2011 In Re Pamela Rodgers Bankr. E.D.N.Y. Case No. 11-42754 Chapter 11 Petition filed April 1, 2011 In Re Patricia Studier Bankr. S.D. Ga. Case No. 11-40690 Chapter 11 Petition filed April 1, 2011 In Re Randall Byrd Bankr. W.D. Texas Case No. 11-10781 Chapter 11 Petition filed April 1, 2011 In Re Timothy Marine Bankr. S.D. Ala. Case No. 11-01313 Chapter 11 Petition filed April 1, 2011 In Re William Budigan Bankr. W.D. Wash. Case No. 11-13822 Chapter 11 Petition filed April 1, 2011 In Re William Warr Bankr. N.D. Ala. Case No. 11-40888 Chapter 11 Petition filed April 1, 2011 In Re Juan Rodriguez Hernandez Bankr. D. Puerto Rico Case No. 11-02855 Chapter 11 Petition filed April 1, 2011 In Re Shelby Verley Bankr. C.D. Calif. Case No. 11-20981 Chapter 11 Petition filed April 2, 2011 In Re Brenda Alarcon Bankr. N.D. Calif. Case No. 11-11234 Chapter 11 Petition filed April 2, 2011 In Re Jose Crespo Vales Bankr. D. Puerto Rico Case No. 11-02857 Chapter 11 Petition filed April 2, 2011 In Re Ernest Thomas Bankr. S.D. Texas Case No. 11-32811 Chapter 11 Petition filed April 2, 2011 In Re Maria Torres Bankr. S.D.N.Y. Case No. 11-11524 Chapter 11 Petition filed April 3, 2011 In Re Karen Johnson Bankr. D. S.C. Case No. 11-02220 Chapter 11 Petition filed April 3, 2011 In Re William Hardegree Kim Hardegree Bankr. N.D. Ala. Case No. 11-40897 Chapter 11 Petition filed April 4, 2011 In Re Frank Boyce Bankr. C.D. Calif. Case No. 11-11564 Chapter 11 Petition filed April 4, 2011 In Re Sheila Kearney Bankr. C.D. Calif. Case No. 11-21131 Chapter 11 Petition filed April 4, 2011 In Re Mieczyslaw Cius Bankr. M.D. Fla. Case No. 11-06394 Chapter 11 Petition filed April 4, 2011 In Re Kings Diner Bar Deli BBQ, LLC fka 710 Food Corp. LLC Bankr S.D. Fla. Case No. 11-19110 Chapter 11 Petition filed April 4, 2011 filed pro se In Re Benigno Marquez Bankr. S.D. Fla. Case No. 11-19120 Chapter 11 Petition filed April 4, 2011 In Re Steven Berkowitz Bankr. S.D. Fla. Case No. 11-19107 Chapter 11 Petition filed April 4, 2011 In Re Briggs Development & Property Management, LLC Bankr. N.D. Ga. Case No. 11-60392 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/ganb11-60392.pdf In Re Carolyn Malcolm Bankr. N.D. Ga. Case No. 11-60274 Chapter 11 Petition filed April 4, 2011 In Re Furcron Developers, LLC Bankr. N.D. Ga. Case No. 11-60202 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/ganb11-60202.pdf In Re Marcelo Ferrari Bankr. N.D. Ga. Case No. 11-60245 Chapter 11 Petition filed April 4, 2011 In Re Maze Properties, Inc. Bankr. N.D. Ga. Case No. 11-60437 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/ganb11-60437.pdf In Re NAM CHI LLC Bankr. N.D. Ga. Case No. 11-60438 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/ganb11-60438.pdf In Re The Nominal Group, Inc. Bankr. N.D. Ga. Case No. 11-60365 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/ganb11-60365.pdf In Re Ronald Murphy Bankr. N.D. Ga. Case No. 11-41116 Chapter 11 Petition filed April 4, 2011 In Re Yong Choe Bankr. N.D. Ga. Case No. 11-60620 Chapter 11 Petition filed April 4, 2011 In Re Dolphus DeLoach Bankr. S.D. Ga. Case No. 11-60180 Chapter 11 Petition filed April 4, 2011 In Re Ramon Jackson Bankr. N.D. Ill. Case No. 11-14259 Chapter 11 Petition filed April 4, 2011 In Re Oldmire, LLC Bankr. M.D. La. Case No. 11-10478 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/lamb11-10478.pdf In Re BHK Properties, LLC Bankr. D. Maine Case No. 11-20451 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/meb11-20451.pdf In Re Cicero Yow Bankr. E.D. N.C. Case No. 11-02630 Chapter 11 Petition filed April 4, 2011 In Re Harry G. Ochs, Inc. Bankr. E.D. Pa. Case No. 11-12746 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/paeb11-12746.pdf In Re Murray Wilhoite Bankr. M.D. Tenn. Case No. 11-03449 Chapter 11 Petition filed April 4, 2011 In Re Robert Tavernini Bankr. N.D. Texas Case No. 11-32341 Chapter 11 Petition filed April 4, 2011 In Re Susanne Walker Bankr. N.D. Texas Case No. 11-32348 Chapter 11 Petition filed April 4, 2011 In Re Uppal Bros., Inc. dba Save Way Food Mart Bankr. N.D. Texas Case No. 11-42051 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/txnb11-42051.pdf In Re Juan Casaretto Bankr. S.D. Texas Case No. 11-10197 Chapter 11 Petition filed April 4, 2011 In Re Brit-Bran, LLC dba Precision Tune Auto Care Bankr. W.D. Texas Case No. 11-60404 Chapter 11 Petition filed April 4, 2011 See http://bankrupt.com/misc/txwb11-60404.pdf In Re Bradley Martin Sheryl Martin Bankr. W.D. Texas Case No. 11-60400 Chapter 11 Petition filed April 4, 2011 In Re Maria Torres Bankr. W.D. Texas Case No. 11-30644 Chapter 11 Petition filed April 4, 2011 In Re Mauro Cedillo Benita Cedillo Bankr. W.D. Texas Case No. 11-30639 Chapter 11 Petition filed April 4, 2011 In Re F&M Land Company, LLC Bankr N.D. Calif. Case No. 11-53215 Chapter 11 Petition filed April 5, 2011 filed pro se In Re Copernicus, Inc. dba Edible Arrangements #714 Bankr. M.D. Fla. Case No. 11-02452 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/flmb11-02452.pdf In Re FSP, Inc. dba Dollar Dawg dba eZmissions dba Right Stuff dba Highway 96 Post Office Bankr. N.D. Ga. Case No. 11-60838 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/ganb11-60838.pdf In Re Butler Trucking, Inc. Bankr. S.D. Ga. Case No. 11-30154 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/gasb11-30154.pdf In Re Bass Healthcare Enterprises, LLC Bankr. E.D. Okla. Case No. 11-80461 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/okeb11-80461.pdf In Re Nelson's Investment Co., Inc. Bankr. E.D. Okla. Case No. 11-80457 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/okeb11-80457.pdf In Re Phila. Playoffs Inc. Bankr E.D. Pa. Case No. 11-12755 Chapter 11 Petition filed April 5, 2011 filed pro se In Re Pope Logging, Inc. Bankr. S.D. Ga. Case No. 11-30153 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/gasb11-30153.pdf In Re Newkirk Holdings, LLC Bankr. W.D. Okla. Case No. 11-11769 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/okwb11-11769.pdf In Re MPACT Martial Arts Academy, Inc. Bankr. M.D. Tenn. Case No. 11-03490 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/tnmb11-03490.pdf In Re Ludgate Investments, LLC Bankr W.D. Texas Case No. 11-30654 Chapter 11 Petition filed April 5, 2011 filed pro se In Re Advanced Heating and Cooling, Inc. Bankr. W.D. Wash. Case No. 11-13937 Chapter 11 Petition filed April 5, 2011 See http://bankrupt.com/misc/wawb11-13937.pdf In Re Young America Mortgage Corporation Bankr. C.D. Calif. Case No. 11-14298 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/cacb11-14298.pdf In Re Jumbo USA, Inc. Bankr. D. Nev. Case No. 11-15076 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/nvb11-15076.pdf In Re Pioneer Health Resources, Inc. Bankr. D. Nev. Case No. 11-51122 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/nvb11-51122.pdf In Re Granite Fields Property Management, LLC Bankr. D. N.H. Case No. 11-11364 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/nhb11-11364.pdf In Re Diamond Oaks Bankr. D. N.H. Case No. Chapter 11 Petition filed April 6, 2011 In Re Golf Club, LLC Bankr. D. N.H. Case No. 11-11365 Chapter 11 Petition filed April 6, 2011 In Re Zadeda Farms, Inc. Bankr. D. N.H. Case No. 11-11366 Chapter 11 Petition filed April 6, 2011 In Re CMC Capital Management Co, LLC Bankr E.D.N.Y. Case No. 11-42852 Chapter 11 Petition filed April 6, 2011 filed pro se In Re Musgrove Trucking, Inc. Bankr. E.D. Okla. Case No. 11-80464 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/okeb11-80464p.pdf See http://bankrupt.com/misc/okeb11-80464c.pdf In Re Kreka Enterprises, Inc. dba Lake Dallas Point Restaurant Bankr. E.D. Texas Case No. 11-41133 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/txeb11-41133.pdf In Re The Poultry Source, Inc. aka Hall's Honey Fried Chicken Bankr. N.D. Texas Case No. 11-32441 Chapter 11 Petition filed April 6, 2011 See http://bankrupt.com/misc/txnb11-32441.pdf In Re N Zone, LLC Bankr. E.D. Ark. Case No. 11-12281 Chapter 11 Petition filed April 7, 2011 See http://bankrupt.com/misc/areb11-12281.pdf In Re Rodney Smith Bankr. C.D. Calif. Case No. 11-25026 Chapter 11 Petition filed April 7, 2011 In Re Guadalupe Luna Bankr. E.D. Calif. Case No. 11-14077 Chapter 11 Petition filed April 7, 2011 In Re Anthony Juliano Bankr. D. Conn. Case No. 11-30912 Chapter 11 Petition filed April 7, 2011 In Re Martin Storage Company, Inc. Bankr. D. Md. Case No. 11-17230 Chapter 11 Petition filed April 7, 2011 See http://bankrupt.com/misc/mdb11-17230p.pdf See http://bankrupt.com/misc/mdb11-17230c.pdf In Re Charles Grigsby Bankr. D. Nev. Case No. 11-15193 Chapter 11 Petition filed April 7, 2011 In Re Timothy Robinson Bankr. D. N.M. Case No. 11-11544 Chapter 11 Petition filed April 7, 2011 In Re GFS Inc. dba Jobee Restaurant Bankr. S.D.N.Y. Case No. 11-11637 Chapter 11 Petition filed April 7, 2011 See http://bankrupt.com/misc/nysb11-11637.pdf In Re GEO Properties Corporation Bankr. W.D.N.Y. Case No. 11-11167 Chapter 11 Petition filed April 7, 2011 See http://bankrupt.com/misc/nywb11-11167.pdf In Re Gary Mercer Bankr. E.D. N.C. Case No. 11-02718 Chapter 11 Petition filed April 7, 2011 In Re Ronald Bryant Bankr. E.D. N.C. Case No. 11-02749 Chapter 11 Petition filed April 7, 2011 In Re Daren Le Beau Bankr. W.D. Okla. Case No. 11-11832 Chapter 11 Petition filed April 7, 2011 In Re Aboshusha, Inc. ta Country Club Diner Bankr. M.D. Pa. Case No. 11-02533 Chapter 11 Petition filed April 7, 2011 See http://bankrupt.com/misc/pamb11-02533.pdf In Re Abatecola Leasing, LLC Bankr. S.D. Texas Case No. 11-80203 Chapter 11 Petition filed April 7, 2011 See http://bankrupt.com/misc/txsb11-80203.pdf In Re Curtis Cripe Bankr. D. Ariz. Case No. 11-09830 Chapter 11 Petition filed April 8, 2011 In Re Silverleaf Perimeter Center, LLC Bankr. D. Ariz. Case No. 11-09724 Chapter 11 Petition filed April 8, 2011 See http://bankrupt.com/misc/azb11-09724p.pdf See http://bankrupt.com/misc/azb11-09724c.pdf In Re Tyson Stuhr Bankr. D. Ariz. Case No. 11 -09726 Chapter 11 Petition filed April 8, 2011 In Re Dan Zhu Bankr. C.D. Calif. Case No. 11-25289 Chapter 11 Petition filed April 8, 2011 In Re RASCO-Alcoa Bankr. C.D. Calif. Case No. 11-25341 Chapter 11 Petition filed April 8, 2011 In Re Gregory Phillips Bankr. M.D. Fla. Case No. 11-06716 Chapter 11 Petition filed April 8, 2011 In Re Mouneimne Properties, LLC Bankr. M.D. Fla. Case No. 11-06730 Chapter 11 Petition filed April 8, 2011 See http://bankrupt.com/misc/flmb11-06730.pdf In Re Windmill Lakes IV Condominium Association, Inc. Bankr. S.D. Fla. Case No. 11-19571 Chapter 11 Petition filed April 8, 2011 See http://bankrupt.com/misc/flsb11-19571.pdf In Re Eugenio Lopez Bankr. D. Nev. Case No. 11-15246 Chapter 11 Petition filed April 8, 2011 In Re NJ Business and Education Center, Inc. Bankr. D. N.J. Case No. 11-21077 Chapter 11 Petition filed April 8, 2011 See http://bankrupt.com/misc/njb11-21077.pdf In Re Charles Garrett Bankr. E.D. N.C. Case No. 11-02797 Chapter 11 Petition filed April 8, 2011 In Re LAZ Holdings, LLC aka Kegs & Corks Bankr. N.D. Texas Case No. 11-32509 Chapter 11 Petition filed April 8, 2011 See http://bankrupt.com/misc/txnb11-32509.pdf In Re Isidro Zaragoza Bankr. D. Nev. Case No. 11-15221 Chapter 11 Petition filed April 8, 2011 In Re Jay Davey Bankr. D. N.H. Case No. 11-11381 Chapter 11 Petition filed April 8, 2011 In Re Jimmy Banks Bankr. D. Nev. Case No. 11-15270 Chapter 11 Petition filed April 8, 2011 In Re Jose Diaz-Gonzalez Bankr. D. Puerto Rico Case No. 11-02995 Chapter 11 Petition filed April 8, 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/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors" Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. 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. *** End of Transmission ***