/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110531.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, May 31, 2011, Vol. 15, No. 149 Headlines 15-35 HEMPSTEAD: NYCB OKs Cash Collateral Use Thru July 30 15-35 HEMPSTEAD: Trustee Seeks to Retain Rhyne as Prop. Supervisor 409-413 BROADWAY: Voluntary Chapter 11 Case Summary 468 ASHTON: Case Summary & 4 Largest Unsecured Creditors 5731-37 WINTHROP: Case Summary & 20 Largest Unsecured Creditors ACCENTIA BIOPHARMA: Posts $1.0-Mil. Net Loss in March 31 Qtr. AGE REFINING: Court OKs Retention of Travis Wolff as Accountant AGE REFINING: Can Sell Redfish Bay Assets to TexStar for $6.5MM ALABAMA AIRCRAFT: Drops Motion to End Labor Contract ALLIED IRISH: Posts EUR10.2 Billion Net Loss in 2010 AMBASSADORS INT'L: Sale Without Prejudice to Creditor Suit AMERICA'S SUPPLIERS: Posts $126,800 Net Loss in First Quarter AMERICAN POST: Incurs $470,700 Net Loss in First Quarter AMTRUST FINANCIAL: Harbor-Led Auction for Parking Garage June 22 AMTRUST FINANCIAL: June 10 Hearing on Disclosure Statement A.M.Y. REALTY: Case Summary & 4 Largest Unsecured Creditors ANIKA AND ASSOCIATES: Voluntary Chapter 11 Case Summary ARK DEVELOPMENT: BB&T Wants to Pursue Collateral Remedies AVI PROPERTIES: Voluntary Chapter 11 Case Summary AXIOM MANAGEMENT: Files Chapter 7 Petition BALLY TOTAL: Contra Costa Retail Dispute Goes to State Court BERNARD L. MADOFF: Mets Owner Want Suit in District Court BLOCKBUSTER CANADA: Closing Some Stores in GOB Sales BERNARD L. MADOFF: Trustee Responds to Wilpon's Dismissal Plea BIO-KEY INTERNATIONAL: Earns $240,200 in First Quarter BIOCORAL, INC: Incurs $200,607 Net Loss in First Quarter BION ENVIRONMENTAL: Names Dominic Bassani as Interim CEO BMF INVESTMENTS: Case Summary & 8 Largest Unsecured Creditors BROWNIE'S MARINE: Posts $273,400 Net Loss in 1st Quarter C 300: Voluntary Chapter 11 Case Summary C-SWDE348 LLC: Proposes Bogatz & Associates as Attorneys CAESARS ENTERTAINMENT: S&P Assigns 'B' Rating to $1.2BB Term Loan CANNERY CASINO: S&P Affirms 'B-' CCR; Outlook Revised to Stable CAPSALUS CORP: Incurs $966,500 Net Loss in First Quarter CARDO MEDICAL: Posts $321,000 Net Loss in March 31 Quarter CASA GRANDE: Voluntary Chapter 11 Case Summary CENTRAL LEASING: Section 341(a) Meeting Scheduled for June 10 CENTURION PROPERTIES: Can Employ Gibbons & Riely as Appraiser CENTURION PROPERTIES: Taps Lukins & Annis as Special Counsel CHRISTIAN BROTHERS: Taps Tarter Krinsky as Gen. Bankruptcy Counsel CHRISTIAN BROTHERS: U.S. Trustee Forms Creditors Committee CIT GROUP: $15.8 Billion Swap Seeks Looser Terms CLYDESDALE CLO: Moody's Raises Rating on Class D Notes to 'Caa3' CNS RESPONSE: Incurs $6.9 Million Net Loss in Q2 Ended March 31 COMMONWEALTH BANKSHARES: Incurs $6.7-Mil. First Quarter Net Loss COMMONWEALTH REIT: S&P Rates $250MM Preferred Shares at 'BB+' COMMUNITY SHORES: Unit Inks $1.07MM Land Sale Deal With Velmeir CONSOLIDATION SERVICES: Posts $111,900 Net Loss in 1st Quarter CYBRDI INC: Posts $118,700 First Quarter Net Loss DANCING BEAR: WestLB Wins Stay Relief to Continue Foreclosure DANCING BEAR: Court Rejects $5 Million DIP Loan From Colbeck DANCING BEAR: Ch. 11 Trustee Moot in View of WestLB Stay Relief D.D.S. GROUP: Case Summary & 10 Largest Unsecured Creditors DEMMIE ACOSTA: Court Defers Payment of Half of Brokers' Fees DENNIS J. FULLENKAMP: Case Summary & 2 Largest Unsecured Creditors DIAMONDHEAD CASINO: Incurs $552,100 Net Loss in 1st Quarter DLGC II: U.S. Trustee Unable to Form Committee DONALD HARTMANN: Court Trims Sally Frederick Lawsuit DRYSHIPS INC: Ocean Rig Adopts Shareholder Rights Plan DUKE & KING: U.S. Trustee Asks for Conversion or Dismissal DUTCH GOLD: Restated 2009 Annual Report Hikes Net Loss by $0.9MM DYNAMO LLC: Court Rejects Former Lawyers' Bid to Reopen Case EAU TECHNOLOGIES: Karl Hellman Resigns as Director EDRA BLIXSETH: Lender Set to Buy Yellowstone 'Family Compound' ELITE PHARMACEUTICALS: Has 243.36MM Outstanding Common Shares ELITE PHARMACEUTICALS: Wistar Morris Discloses 4.39% Equity Stake ENTREMED, INC: Incurs $2.6 Million First Quarter Net Loss ESCALON MEDICAL: Incurs $1.9 Million Net Loss in Q3 Ended March 31 EVANS OIL: Can Use Fifth Third's Cash Collateral Until June 3 EVANS OIL: Selling Marine Fuel Supply Equipment to Florida Marina EVANS OIL: Fifth Third Wants to Commence Foreclosure on Property EVERGREEN TRANSPORTATION: Trustee Seeks to Appoint Attorney FANNIE MAE: Investor, Housing Lobby Clash on Fannie Future FIDDLER'S CREEK: Bondholders Want Examiner, Not Confirmation FIRST PHYSICIANS: Reports $1.04-Mil. Preliminary Loss for Q1 FONAR CORP: Five Directors Elected at Annual Meeting FORTRESS ENERGY: CCAA Protection Extended Until June 30 FREEWAY FOODS: Landlord's Suit Stays in Bankruptcy Court GALLERY ROW: Case Summary & 9 Largest Unsecured Creditors GARLOCK SEALING: Given Plan Exclusivity Until Nov. 28 GIGI PROPERTIES: Voluntary Chapter 11 Case Summary GOLDENPARK, LLC: Gets Interim Access to Urban's Cash Collateral GOLDENPARK, LLC: Wants Until June 6 to File Schedules & Statements GREAT ATLANTIC PRE-CAST: Case Summary & Largest Unsec. Creditors GREAT ATLANTIC & PACIFIC: Wants to Start Superfresh Closing Sales GREAT CHINA INTERNATIONAL: Posts $733,800 Net Loss in Q1 2011 GREEN ENERGY MANAGEMENT: Incurs $12.7 Million Net Loss in Q1 2011 GREEN MOUNTAIN: Moody's Upgrades Bank Debt Rating to 'Ba2' GREENMAN TECHNOLOGIES: Posts $2.3-Mil. Loss in Fiscal 2nd Quarter GULF FLEET: Wants Cash Collateral Access Extended Until Aug. 5 GULF OFFSHORE: S&P Affirms CCR at 'CCC+'; Outlook Developing HARROGATE INC: Fitch Lowers Rating on Revenue Bonds to 'BB+' HEALTHSPRING INC: S&P Affirms Counterparty Credit Rating at 'B+' HEARUSA INC: U.S. Trustee Appoints 5-Panel Creditors' Committee HEARUSA INC: Seeks Appointment of Consumer Privacy Ombudsman HEARUSA INC: Patient Care Ombudsman Not Necessary for Now HEARUSA INC: Sec. 341 Creditors' Meeting Set for June 17 HEARUSA INC: Gets Incompliance Notice From NYSE Amex HEREFORD BIOFUELS: Dist. Court Rules on Suit v. Greenstone HSRE-CDS I: Gets 2nd Interim OK to Use KeyBank's Cash Collateral HSRE-CDS I: Taps BBK, Ltd. to Assist in Financing Transactions HYMAN COS: Dist. Ct. Rejects Kieselstein's Indemnification Claims INDIANAPOLIS DOWNS: Dismissal of Power Plant Lawsuit Sought INNOLOG HOLDINGS: Incurs $654,600 First Quarter Net Loss INTERNATIONAL BARRIER: Reports $11,100 Net Income in March 31 Qtr. IRON MOUNTAIN: S&P Affirms CCR at 'BB-'; Outlook Negative IVOICE, INC: Incurs $308,500 Net Loss in 1st Quarter J&K WRIGHT: Court Confirms Second Amended Plan JACKSON HEWITT: Hires Alvarez & Marsal as Fin'l Advisors JACKSON HEWITT: Moelis on Board as Investment Banker JACKSON HEWITT: Withdraws Listing of Common Stock from Exchange JOHN CLEMENTE: Ex-Wife Loses Bid to Collect Counsel Fees JOHN MESSINA: 7th Cir. Warns of Sanctions Over Frivolous Appeals JORDAN HOSPITAL: S&P Affirms Rating on $81MM Bonds at 'BB-' JUNIPER GROUP: SEC Requires Delivery of Certain Documents KASDEN FUEL: Trustee May Hire Consultant in the Ordinary Course LA JOLLA: Has $15.44 Million Outstanding Common Shares LANDAMERICA 1031: $14.3 Million Deal Ends SunTrust ARS Dispute LAS VEGAS RAILWAY: CFO Gregory West Resigns; Replacement Named LASALLE RESIDENTIAL: Case Summary & 20 Largest Unsecured Creditors LEGAL XTRANET: Suit v. AT&T Management Goes Back to State Court LESLIE DANNER: Bauer & French Pay Terms Violate Bankruptcy Code LEVEL 3: Subsidiary Enters Into Supplemental Indenture LEWIS AND CLARK: Case Summary & 20 Largest Unsecured Creditors LIBBEY INC: Three Directors Elected at Annual Meeting LIFECARE HOLDINGS: Moody's Affirms Caa1 Corporate Family Rating MARINA BIOTECH: Posts $3.7 Million Net Loss in First Quarter MCCLATCHY CO: Promotes Mark Zieman to Vice Pres. Operations MCCLATCHY CO: Moody's Changes Rating Outlook to Positive MCINTOSH BANCSHARES: Expects $2.4-Mil. First Quarter Net Loss METISCAN, INC: Posts $10,300 Net Loss in First Quarter METROGAS S.A.: Posts ARS26.3 Million Net Loss in First Quarter MIT HOLDING: Incurs $567,800 Net Loss in First Quarter MIT HOLDING: Has 5-Year Distribution Deal with Global Reach MMFX INTERNATIONAL: Agreed to Termination of Plan Exclusivity MORTGAGES LTD: Says Greenberg Suit Belongs in State Court MOUNTAINEER GAS: Fitch Upgrades IDR to 'BB'; Outlook Positive MSR RESORT: Creditors Committee Wants Challenge Period Extended NATIONAL AUTOMATION: Swings to $2.23-Mil. First Quarter Profit NNN 2003: Reports $12.26-Mil. Net Income in First Quarter NORD RESOURCES: Incurs $2.27 Million First Quarter Net Loss NORTEL NETWORKS: Posts $105 Million First Quarter Net Loss NORTEL NETWORKS: Keightley & Ashner Okayed as Pension Counsel NORTEL NETWORKS: Settles With Israel Affiliate for $2 Million NPS PHARMACEUTICALS: Amendment to 2005 Incentive Plan Approved NUTRACEA: Posts $4.1 Million Net Loss in March 31 Quarter OPTIONS MEDIA: Salberg & Company Raises Going Concern Doubt ORANGE GROVE: Can Hire Jerome S. Cohen as Bankruptcy Counsel OSAGE EXPLORATION: Incurs $57,400 Net Loss in First Quarter OSSIS IRON: Case Summary & 20 Largest Unsecured Creditors OUTSOURCE HOLDINGS: FBLB-Led Auction for Jefferson Bank on June 15 OUTSOURCE HOLDINGS: Taps Fenimore Kay Special Transaction Counsel OXIGENE, INC: Incurs $863,000 Net Loss in First Quarter PACIFICA MESA: Workers Sees Enterprise Value Drop, Withdraws Plan PALM HARBOR: Wants Plan Exclusivity Until July 28 PARK CENTRAL: Taps Grubb & Ellis as Real Property Leasing Agent PARK CENTRAL: Taps Valuation Consultants as Real Estate Appraiser PARKER BUILDING: Case Summary & 9 Largest Unsecured Creditors PARKERVISION, INC: Incurs $3.4 Million First Quarter Net Loss PARMALAT SPA: 2nd Circ. Spares BofA from Investors' $300M Claim PERSIAN GALLERY: Case Summary & 20 Largest Unsecured Creditors PETROLEUM & FRANCHISE: Proposes Downs as Special Counsel PLATINUM ENERGY: Tim Culp Discloses 7.9% Equity Stake POINT BLANK: Equity Committee Can Hire Bifferato as Del. Counsel POINT BLANK: Judge Stays Case Over Deregistration Plan POLI-GOLD LLC: Can Access AZ Havasu Cash Collateral Until Sept. 30 PRECISION OPTICS: Incurs $302,300 Net Loss in Q3 Ended March 31 PRIUM SPOKANE: Can Employ Berreth, Lochmiller as Accountants PURESPECTRUM, INC: Incurs $390,700 Net Loss in March 31 Quarter QUALITY DISTRIBUTION: Seven Directors Elected at Annual Meeting QUAMTEL, INC: Posts $679,100 Net Loss in First Quarter QUIGLEY CO: Court Lacks Power to Halt Pfizer Asbestos Claims R & R PLAZA: Case Summary & 14 Largest Unsecured Creditors RADIENT PHARMACEUTICALS: Incurs $85.71 Million Net Loss in 2010 RADIENT PHARMACEUTICALS: Expects to Report $10MM-$12MM Loss in Q1 RADIO ONE: Doyle Mitchell Resigns from Board of Directors RENASCENT, INC: Taps John Amsden for Claim vs. Thornburg RICHARD LIND: Deutsche Bank Has Green Light to Amend Claim RICKY MURRAY: Has Green Light to Use BB&T's Cash Collateral RIDGERUNNER LLC: Bauer & French Pay Terms Violate Bankruptcy Code RIVER ROCK: Reports $7.18 Million Income in March 31 Quarter ROBERT BRYANT: Dolins Awarded $1,800 in Attorney Fees ROCKY MOUNTAIN: Case Summary & 7 Largest Unsecured Creditors RUGGED BEAR: Could Reopen Next Year; Franchisee Keeps 2 Stores RUSSELL SUTHERLAND: Untimely Plan Prompts Case Dismissal SALLY HOLDINGS: S&P Raises CCR to 'BB'; Outlook Revised to Pos. SAINT VINCENTS: District Court Affirms Stay Enforcement Order SBARRO, INC: Drops Prepack in Favor of Negotiating Sale SBARRO, INC: Judge Sets July 8 Claims Bar Date SEAHAWK DRILLING: Hayman Capital's Wind Down Financing Approved SEP RIVERPARK: Plan Outline Hearing Continued Until June 1 SHARMA HOLDING: Case Summary & 12 Largest Unsecured Creditors SHERIDAN GROUP: Incurs $2.36-Mil. First Quarter Net Loss SHREE-GURU INVESTMENTS: Case Summary & Creditors List SHOPS AT PRESTONWOOD: Taps Franklin Skierski as Bankruptcy Counsel SHOPS AT PRESTONWOOD: Wants to Sell 6 Residential Lots to Insider SIMMONS FOODS: S&P Lowers Corporate Credit Rating to 'B-' SMART ONLINE: Incurs $987,798 Net Loss in First Quarter SOURCE INTERLINK: Acquires Mind Over Eye SPARTAN HOLDING: Case Transferred W.D.N.C. Bankruptcy Court SRKO FAMILY: Can Hire Littleton & Project One as REIT Consultants STONERIDGE INC: S&P Raises Corporate Credit Rating to 'BB-' STUDIO ONE: Posts $1.9 Million Net Loss in Q3 Ended March 31 SUFFOLK REGIONAL OTB: Proposes Paying Admin. Creditors in Full SUN VALLEY: Case Summary & 14 Largest Unsecured Creditors SUPERIOR ACQUISITIONS: Plan Confirmation Date Extended to July 20 SW GEORGIA ETHANOL: Plan Filing Exclusivity Extended Until July 1 SW OWNERSHIP: Financing Denied, Wants Case Converted to Chapter 7 SYRACUSE LITHOGRAPHING: Case Summary & Creditors List T3 MOTION: Restates Debenture Agreement with Vision Opportunity TASTY BAKING: Common Stock Delisted from NASDAQ TAYLOR CAPITAL GROUP: Fitch Affirms Long-Term IDR at 'B-' TELVUE CORPORATION: Incurs $797,600 Net Loss in March 31 Quarter TEMPLE-INLAND: Moody's Upgrades Senior Unsecured Debt From Ba1 TIMOTHY BLIXSETH: Involuntary Petition Dismissed for Wrong Venue TN-K ENERGY: Reports $596,800 Net Income in First Quarter TOUSA INC: Wants to Use Lenders' Cash Collateral Beyond June 1 TOUSA TEXAS: Sells 71 Acres of Land to Michael Rose for $500,000 TRAILER BRIDGE: Incurs $10.39 Million Net Loss in First Quarter TRIAD GUARANTY: Confirms 2011 Performance Goals TRITON AVIATION: Fitch Affirms C Rating on Four Classes of Notes TRUMP ENTERTAINMENT: Landry's Wins OK to Buy Trump Marina Casino UDI PROPERTIES: Voluntary Chapter 11 Case Summary UNITY HOUSE: Judge Approves Sale of Assets for $18.5 Million UNO RESTAURANT: Velina Exum Suit Not "Related To" Bankruptcy USA BABY: May Not to Pursue Speculative Claims, 7th Cir. Says VILLA BELLAGIO: Case Summary & 6 Largest Unsecured Creditors V.I.P. ELECTRIC: Case Summary & 20 Largest Unsecured Creditors VISUALANT, INC: Obtains $1MM Financing from Gemini & Ascendiant VITA PARTNERS: Owes $2 Million From Two Landlords VU1 CORPORATION: Posts $1.2 Million Net Loss in Q1 2011 VYTERIS INC: John Burrows Resigns as Director W&K STEEL: Case Summary & 20 Largest Unsecured Creditors WAGLE VENTURES: Case Summary & 3 Largest Unsecured Creditors WARNER MUSIC: Receives Requisite Consents to Amend 2009 Indenture WASHED AGGREGATE: Case Summary & 13 Largest Unsecured Creditors WASHINGTON LOOP: ROBI1956 Wants Cash Collateral Use Request Denied WATERFORD HOTEL: Holiday Inn in Michigan Files for Chapter 11 WCK INC: Secured Creditor Wants Cash Collateral Access Denied WELLINGTON PRESERVE: Sale Approved; Liquidating Plan Confirmed WENDY'S/ARBY'S GROUP: S&P Affirms CCR at 'B+'; Outlook Stable WESTSIDE ATHLETIC: Case Summary & 14 Largest Unsecured Creditors WINDMILL DURANGO: Gets OK for Flangas as Litigation Counsel WINGATE AIRPORT: U.S. Trustee Unable to Form Committee WINGATE AIRPORT: Gets Approval to Employ Neil J. Beller as Counsel WL HOMES: Wachovia Has Enforceable Security Interest in Asset * Bank of America, Morgan Stanley Settle Foreclosure Suit * SecondMarket Says Claims Trading Facing 'Slowdown' * Large Companies With Insolvent Balance Sheet ********* 15-35 HEMPSTEAD: NYCB OKs Cash Collateral Use Thru July 30 ---------------------------------------------------------- The Honorable Gloria M. Burns of the U.S. Bankruptcy Court for the District of New Jersey signed a consent order resolving issues between 15-35 Hempstead Properties, LLC, et al., and secured creditor New York Community Bank. The Consent Order disposes of NYCB's Motion for Relief from Automatic Stay and Motion to Appoint a Trustee and Objection to the Continued Use of Cash Collateral. Among other things, the parties agree on the Debtor's continued use of cash collateral through the end of July 2011. NYCB filed the Motion for Relief on March 10, 2011, citing the Debtors' failure to file a confirmable plan of reorganization and failure to make postpetition payments to NYCB. The Official Committee of Unsecured Creditors filed an objection to the motion on April 7. By April 13, the Debtor, NYCB, and the Committee entered into the Consent Order. The Consent Order provides that: -- NYCB's Motion for Relief will be granted upon approval of the Consent Order; -- NYCB will forebear from proceeding on any remedies so long as there is no uncured event of default under the Consent Order; -- NYCB's Motion to Appoint a Trustee is adjourned sine die, subject to being restored to the Court's calendar on two days' telephone notice; -- The Debtors' Motion for Cash Collateral Use will be approved through July 30, 2011, subject to the Consent Order and a prepared budget, a copy of which is available for free at: http://bankrupt.com/misc/1535HEMPSTEAD_cashcollbudgetthruJul2011.pdf A continued hearing on the use of cash collateral will be scheduled for July 25, 2011, at 11:30 a.m. -- The terms and conditions of the Third Cash Collateral Order are incorporated as if fully set forth and will be applicable through July 30, 2011. -- NYCB's forbearance will expire no later than July 30, 2011, subject to these terms: a. The Debtor will have filed a Plan of Reorganization and Disclosure Statement by April 15, 2011, in a form acceptable to the Bank and the Committee. b. The Debtor's Plan will require that if the "Sales Requirement" is not achieved by July 30, 2011, the property will be sold at an auction on or before Sept. 30, 2011. c. The Debtor's Plan will also contain a provision for sales in the ordinary course which may commence after the Sales Requirement is met. d. Commencing immediately, only Ira Saligman or a property manager designated by him will have signatory authority or use of any debit card. Mr. Saligman is to provide the Bank and Mr. Kates with 48 hours' notice of the issuance of payments over $500. e. Saligman-Decker may hire a property manager by filing an application consistent with Section 327(a) of the Bankruptcy Code who will report to Saligman-Decker and the Kates. f. The Plan will provide for a release price to NYCB of the greater of $130/sq. foot or 75% of gross proceeds. g. In the event of an auction, NYCB is entitled to credit bid. In the event of a credit bid, NYCB will carve out proceeds to pay all administrative claims in full. h. Sale Requirements. The Debtor will deliver agreements of sale which are approved by July 30, 2011 for closing on or before Sept. 30, 2011, which will be at least 60 units and generate at least $6 million of proceeds to NYCB. i. In the event unpaid administrative costs, exclusive of professional fees, exceed $200,000, NYCB will have election to require the Debtor to convert to a Chapter 7 proceeding. j. NYCB agrees to fund approved professional fees as a carve- out from any auction or credit bid. k. The Debtor will file a motion to remove to the Bankruptcy Court its pending real estate tax appeals against the City of Atlantic City, and the Debtor consents to intervention by NYCB and the Committee as parties in the Tax Appeals. -- The Debtor will file an application to employ its broker and Beverly Cox as bookkeeper. Judge Burns inked the Consent Order on April 13. By April 18, as a result of numerous alleged defaults by the Debtors under the Consent Order, NYCB filed a Notice of Presentment where it sought that the automatic stay be vacated as it pertains to NYCB. In an April 27 filing, the Committee notes that the time for NYCB to request relief from the automatic stay has passed. The Committee says it further reserves all of its rights with respect to NYCB's Motion for Relief. About 15-35 Hempstead Properties 15-35 Hempstead Properties, LLC, owns real property at 101 Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10-43178) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, assists 15-35 Hempstead in its restructuring effort. 15-35 Hempstead estimated its assets and debts at $10 million to $50 million. Affiliate Jackson 299 Hempstead, LLC, filed a separate Chapter 11 petition (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010. Jackson 299 Hempstead, LLC, owns a parcel of real property at 101 Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, assists Jackson 299 in its restructuring effort. Jackson 299 estimated its assets and debts at $10 million to $50 million. At the behest of secured lender New York Community Bank, the bankruptcy judge ordered the appointment of a chapter 11 trustee in the Debtors' bankruptcy cases. 15-35 HEMPSTEAD: Trustee Seeks to Retain Rhyne as Prop. Supervisor ------------------------------------------------------------------ Karen L. Gilman, the Chapter 11 Trustee for 15-35 Hempstead Properties, LLC, and Jackson 299 Hempstead LLC, seeks authority from the U.S. Bankruptcy Court for the District of New Jersey, to retain Philip Rhyne as on-site property supervisor, nunc pro tunc to May 12, 2011. The Debtors on March 10, 2011, obtained permission from the Bankruptcy Court to employ Saligman-Decker Associates, LLC, as their property managers. In its application, the Debtors said they need a manager to manage their property by collecting rents, preparing an annual budget, overseeing maintenance of the property, overseeing the acquisition of insurance, keeping property records, preparing records and overseeing landlord-tenant issues. On April 22, 2011, Saligman-Decker hired Philip Rhyne as on-site property manager, pending the execution of a formal contract and presumably, filing of a formal retention application with the Court. Saligman-Decker did not file an application consistent with the Consent Order or Section 327(a) of the Code. The Letter of Agreement specifies that Mr. Rhyne will be paid as a 1099 Contractor with no benefits at an annual salary of $47,500 plus $5,000 bonus on December 31. The Letter of Agreement provides for an April 23, 2011, start date. Mr. Rhyne's compensation also includes a two-bedroom apartment, presumably at the Property. The Letter Agreement provides that all other terms of employment such as vacation and severance are to be determined pending the execution of formal contract. Following the appointment of chapter 11 trustee on May 4, 2011, Saligman-Decker abruptly resigned as Manager. Despite Saligman- Decker's resignation, Mr. Rhyne has acted in good faith as on-site property supervisor with daily presence at the property and continues to act in this capacity pursuant to the Letter Agreement. The Trustee said that an on-site supervisor with a daily presence at the Debtors' property is critical to the preservation of the Debtor's assets, given that the property consists of multiple residential apartment units. About 15-35 Hempstead Properties 15-35 Hempstead Properties, LLC, owns real property at 101 Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10-43178) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, assists 15-35 Hempstead in its restructuring effort. 15-35 Hempstead estimated its assets and debts at $10 million to $50 million. Affiliate Jackson 299 Hempstead, LLC, filed a separate Chapter 11 petition (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010. Jackson 299 Hempstead, LLC, owns a parcel of real property at 101 Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, assists Jackson 299 in its restructuring effort. Jackson 299 estimated its assets and debts at $10 million to $50 million. The cases are jointly administered under 15-35 Hempstead Properties, LLC. 409-413 BROADWAY: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: 409-413 Broadway, LLC 409 Broadway Brooklyn, NY 11211 Bankruptcy Case No.: 11-44505 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Jerome Feller Debtor's Counsel: Lawrence Morrison, Esq. 140 East 45th Street, 19th Floor New York, NY 10017 Tel: (212) 655-3582 Fax: (646) 390-5095 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 Michael D. Alto, managing member. 468 ASHTON: Case Summary & 4 Largest Unsecured Creditors -------------------------------------------------------- Debtor: 468 Ashton LLC 479 Ocean Avenue, Suite A Laguna Beach, Ca 92651 Tel: (949) 715-1500 Bankruptcy Case No.: 11-17405 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Central District of California (Santa Ana) Judge: Mark S. Wallace Debtor's Counsel: David G. Epstein, Esq. THE DAVID EPSTEIN LAW FIRM P.O. Box 4858 Laguna Beach, CA 92652-4858 Tel: (949) 715-1500 Fax: (949) 715-2570 E-mail: david@epsteinlitigation.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/cacb11-17405.pdf The petition was signed by Mark Smith, managing member. 5731-37 WINTHROP: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: 5731-37 Winthrop, LLC 2408 North Kedzie Blvd. Chicago, IL 60647 Bankruptcy Case No.: 11-22144 Chapter 11 Petition Date: May 25, 2011 Court: United States Bankruptcy Court Northern District of Illinois (Chicago) Judge: Carol A. Doyle Debtor's Counsel: David K Welch, Esq. CRANE HEYMAN SIMON WELCH & CLAR 135 S Lasalle St., Suite 3705 Chicago, IL 60603 Tel: (312) 641-6777 Fax: (312) 641-7114 E-mail: dwelch@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/ilnb11-22144.pdf The petition was signed by Relu Stan, manager/member. ACCENTIA BIOPHARMA: Posts $1.0-Mil. Net Loss in March 31 Qtr. ------------------------------------------------------------- Accentia BioPharmaceuticals Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $1.0 million on $2.3 million of sales for the three months ended March 31, 2011, compared with a net loss of $45.8 million on $2.1 million of sales for the same period ended March 31, 2010. The Company's balance sheet at March 31, 2011, showed $7.5 million in total assets, $94.2 million in total liabilities, and a stockholders' deficit of $86.7 million. On March 31, 2011, the Company had an accumulated deficit of approximately $328.5 million and a working capital deficit of approximately $31.9 million. Cash and cash equivalents at March 31, 2011, was $2.5 million of which $2.3 million was attributable to Biovest. The Company's independent registered public accounting firm's report included a "going concern" qualification on the financial statements for the year ended Sept. 30, 2010, citing significant losses and working capital deficits at that date, which raised substantial doubt about the Company's ability to continue as a going concern. A full-text copy of the Form 10-Q is available for free at: http://is.gd/VuD5V3 About Accentia BioPharmaceuticals Headquartered in Tampa, Florida, Accentia BioPharmaceuticals Inc. (OTC QB: ABPI) -- http://www.accentia.net/ -- is committed to advancing the autoimmune disease therapy, Revimmune(TM), as a comprehensive system of care and drug regimen designed for the treatment of autoimmune diseases. Revimmune therapy includes an ultra-high-dose regimen of Cytoxan(R) (cyclophosphamide), exclusively supplied via a strategic agreement with Baxter Healthcare Corporation. Clinical trials for Revimmune are being planned for the treatment of multiple autoimmune indications. Accentia holds a majority-ownership stake in Biovest International, Inc. (OTC QB: "BVTI"), an emerging leader in the field of active personalized immunotherapies. In collaboration with the National Cancer Institute, Biovest has developed a patient-specific, cancer vaccine, BiovaxID(R), with three clinical trials completed, including a Phase III study for the treatment of follicular non-Hodgkin's lymphoma. Additionally, Accentia's wholly-owned subsidiary, Analytica International, based in New York City, is a global research and strategy consulting firm that provides professional services to the pharmaceutical and biotechnology industries. Since 1997, Analytica has expertly directed research studies and projects, including traditional health economic modeling projects, database studies, structured reviews, heath technology assessments, reimbursement analyses, and value dossiers. On Nov. 10, 2008, Accentia BioPharmaceuticals, along with its subsidiaries filed for Chapter 11 protection (Bankr. M.D. Fla. Lead Case No. 08-17795). The Company emerged from Chapter 11 protection, and the Plan of Reorganization became effective, on Nov. 17, 2010. AGE REFINING: Court OKs Retention of Travis Wolff as Accountant --------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Texas has approved the employment of Travis Wolff, LLP as accountants to AGE Refining, Inc. Eric J. Moeller, the Chapter 11 trustee assigned in the Chapter 11 case of Age Refining, asked the Bankruptcy Court's permission to hire Travis Wolff to provide accounting and bookkeeping assistance, cash management assistance, including processing of checks, payroll, deposits and other cash transaction, preparations of schedules as required, and consulting on accounting, business and tax matters. Gary Hoyack, CPA, assurance partner, and Kelly Land, accounting associate, will act as lead accountants in the Debtor's case. Their hourly rates are: Mr. Hoyack $275 Ms. Land $75 To the best of the trustee's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: TRAVIS WOLFF, LLP 9901 IH-10, Suite 500 San Antonio, TX 78230 Tel: (210) 820-3900 E-mail: ghoyack@traviswolff.com 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., at 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. About $29.6 million is owed to a group of Construction Lenders led by JPMorgan Chase Bank, N.A., and Chase Capital Corporation, and about $10 million is owed to a group of Junior Lenders. 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. AGE REFINING: Can Sell Redfish Bay Assets to TexStar for $6.5MM --------------------------------------------------------------- Eric J. Moeller, the Court-appointed Chapter 11 trustee of Age Refining, Inc., sought and obtained permission from the U.S. Bankruptcy Court for the Western District of Texas to sell certain of the Debtor's assets referred to as the Redfish Bay Assets, free and clear of all liens, claims, and encumbrances to TexStar Midstream Services, LP, for $6,500,000. Judge Leif M. Clark also approved the Asset Purchase Agreement between the Chap. 11 Trustee and Texstar, governing the purchase and sale of the Redfish Bay Assets, a full-text copy of which is available for free at http://bankrupt.com/misc/AGERefining_TexstarAPA.pdf Pursuant to the court-approved bidding procedures, the deadline for all potential buyers to submit offers for the purchase of the Redfish Bay Assets was May 17, 2011. On May 18, 2011, the Chap. 11 Trustee announced that he decided to sell the Redfish Bay Assets to TexStar for $6,500,000. Upon submission of the offer, TexStar deposited $1,000,000 on May 17, 2011 with the balance of the purchase price to be deposited by May 20, 2011. The Chap. 11 Trustee has determined that the sale of the Redfish Bay Assets to the Purchaser constituted the highest and best offer for the Redfish Bay Assets and will provide a greater recovery for the Debtor's estates than would be provided by any other available alternative permitted under the Bid Procedures Order. The Court's order provides that because JPMorgan Chase Bank, N.A. and Chase Capital Corporation are the sole parties asserting liens on the Redfish Bay Assets, interim partial payments of JPMorgan's claims may be made from the proceeds of the transaction contemporaneously with the closing. The Chap. 11 Trustee states that the interim, partial payments of the DIP Indebtedness due JPMorgan are entirely appropriate because: (i) those payments were a precondition to the consents of JPMorgan and Chase Capital to the Sale as required by Section 363(f)(2) of the Bankruptcy Code; (ii) the Chap. 11 Trustee might not be able to adequately protect the liens of JPMorgan in the cash proceeds of its collateral; and (iii) it would make little economic sense for the Chap. 11 Trustee to retain the proceeds in escrow and continue to incur the substantial ongoing interest accruals and "negative carry" with respect to the DIP indebtedness. 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. ALABAMA AIRCRAFT: Drops Motion to End Labor Contract ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Alabama Aircraft Industries Inc. dropped a motion it filed on March 10 to reject a collective bargaining agreement with the labor union. Although trial on the contract-rejection motion was completed, the company decided no purpose would be served by having the judge rule and further alienate workers considering how the business will go up for auction June 6. Mr. Rochelle relates that AAI said it was unable to locate an "equity investor," meaning that terminating the labor contract would serve no useful purpose since the business is being sold. The company said it got what it needed from the workers when the union agreed after the trial to modify the labor agreement by deleting a requirement for the maintenance of the existing pension plan. The bankruptcy court also authorized a so-called distress termination of the plan. About Alabama Aircraft Birmingham, Alabama-based Alabama Aircraft Industries Inc. -- http://www.alabamaaircraft.com/-- provides aircraft maintenance and modification services for the U.S. government and military customers. Its 190-acre facility, including its corporate offices, is located at the Birmingham International Airport. The Company currently has 92 salaried employees and 234 hourly employees. About 251 hourly employees were furloughed since Jan. 1, 2010. Alabama Aircraft filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-10452) on Feb. 15, 2011. Two subsidiaries also filed -- Alabama Aircraft Industries, Inc.- Birmingham (Case No. 11-10453) and Pemco Aircraft Engineering Services, Inc. (Case No. 11-10454). The Company said the primary goal of the Chapter 11 filing is to address long-term indebtedness and, in particular, long-term pension obligations under the terms of its pension plan. The Company said it would likely cease operations by April 15, 2011, absent the elimination of its obligations under the pension plan. The Company owes $68.5 million to the Pension Benefit Guaranty Corp. Joel A. Waite, Esq., and Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serve as counsel to the Debtors. Alabama Aircraft estimated assets and debts of $1 million to $10 million as of the Chapter 11 filing. ALLIED IRISH: Posts EUR10.2 Billion Net Loss in 2010 ---------------------------------------------------- Allied Irish Banks, p.l.c., filed on May 18, 2011, its annual report on Form 20-F for the fiscal year ended Dec. 31, 2010. KPMG, in Dublin, Ireland, noted that there are a number of material economic, political and market risks and uncertainties that impact the Irish banking system, including the Company's continued ability to access funding from the Eurosystem and the Irish Central Bank to meet its liquidity requirements, that raise substantial doubt about the Company's ability to continue as a going concern. The Company reported a net loss of EUR10.16 billion on EUR1.84 billion of interest income for 2010, compared with a net loss of EUR2.33 billion on $2.87 billion of interest income for 2009. The net loss of EUR10.2 billion for 2010 included a loss of EUR6.0 billion on the transfer of assets to the National Asset Management Agency ("NAMA"). Total operating income was negative EUR3.4 billion in 2010. Excluding the loss on transfer of assets to NAMA, total operating income was EUR2.6 billion. This compares to EUR4.1 billion in the year to December 2009, a decrease of EUR1.5 billion or 36%. The Company's balance sheet at Dec. 31, 2010, showed EUR145.2 billion in total assets, EUR140.9 billion in total liabilities, and stockholders' equity of EUR4.3 billion. A copy of the Form 20-F is available at http://is.gd/j6fXs9 About Allied Irish Banks, p.l.c. Allied Irish Banks, p.l.c. -- http://www.aibgroup.com/-- is a major commercial bank based in Ireland. It has an extensive branch network across the country, a head office in Dublin and a capital markets operation based in the International Financial Services Centre in Dublin. AIB also has retail and corporate businesses in the UK, offices in Europe and a subsidiary company in the Isle of Man and Jersey (Channel Islands). Since the onset of the global and Irish financial crisis, AIB's relationship with the Irish Government has changed significantly. As at Dec. 31, 2010, the Government, through the National Pension Reserve Fund Commission ("NPRFC"), held 49.9% of the ordinary shares of the Company (the share of the voting rights at shareholders' general meetings), 10,489,899,564 convertible non- voting ("CNV") shares and 3.5 billion 2009 Preference Shares. On April 8, 2011, the NPRFC converted the total outstanding amount of CNV shares into 10,489,899,564 ordinary shares of AIB, thereby increasing its holding to 92.8% of the ordinary share capital. In addition to its shareholders' interests, the Government's relationship with AIB is reflected through formal and informal oversight by the Minister and the Department of Finance and the Central Bank of Ireland, representation on the Board of Directors (three non-executive directors are Government nominees), participation in NAMA, and otherwise. AMBASSADORS INT'L: Sale Without Prejudice to Creditor Suit ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that although the bankruptcy judge gave Windstar Cruises authority to sell its three luxury sailing yachts to The Anschutz Corp., the order approving the sale says that creditors' committee can nonetheless raise claims against the principal secured creditor, Whippoorwill Associates Inc. Mr. Rochelle relates that the committee unsuccessfully opposed the sale. Along with opposition papers, the committee filed a lawsuit against Whippoorwill contending that the secured lender controlled Windstar, fabricated the basis for an otherwise unnecessary Chapter 11 filing, and arranged the sale so the price would be enough to cover the debt it was owed plus counsel fees, "but not a dollar more." The order approving the sale says that the seller, Windstar, and the buyer, Anschutz, were both in good faith. Nonetheless, the last paragraph in the sale-approval order says that it's without prejudice to the ability of the committee to pursue claims against Whippoorwill and Windstar's managers. Mr. Rochelle notes that there are grammatical errors in the paragraph making it unclear exactly what the critical paragraph in the order means and the extent to which it won't prejudice the committee's suit. A creditors' committee isn't automatically authorized to file claims belonging to a bankrupt company. Because the Windstar creditors' committee wasn't authorized to file the complaint, the order also says that it can't be interpreted as giving the committee the right to pursue the complaint against Whippoorwill, according to Mr. Rochelle. About Ambassadors International Headquarters in Seattle, Washington, Ambassadors International, Inc. (NASDAQ: AMIE) -- http://www.ambassadors.com/-- operates Windstar Cruises, a three-ship fleet of luxury yachts that explore the hidden harbors and secluded coves of the world's most sought- after destinations. Carrying 148 to 312 guests, the luxurious ships of Windstar cruise to nearly 50 nations, calling at 100 ports throughout Europe, the Caribbean and the Americas. Ambassadors International Inc. and 11 affiliates sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11002) on April 1, 2011. Kristopher M. Hansen, Esq.; Sayan Bhattacharyya, Esq.; Marianne Mortimer, Esq.; and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, serve as the Debtors' bankruptcy counsel. Imperial Capital, LLC, is the Debtors' financial advisor. Phase Eleven Consultants, LLC, is the Debtors' claims and notice agent. The Debtors tapped Bifferato Gentilotti LLC as Delaware counsel, and Richards, Layton & Finger as bankruptcy co-counsel. The Official Committee of Unsecured Creditors tapped Kelley Drye & Warren LLP as its counsel, and Lowenstein Sandler PC as its co-counsel. The Debtors disclosed $86.4 million in total assets and $87.3 million in total debts as of Dec. 31, 2010. AMERICA'S SUPPLIERS: Posts $126,800 Net Loss in First Quarter ------------------------------------------------------------- America's Suppliers, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $126,787 on $3.35 million of revenues for the three months ended March 31, 2011, compared with net income of $18,460 on $3.23 million of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.63 million in total assets, $1.89 million in total liabilities, and a stockholders' deficit of $254,586. The Company has a recent history of operating losses and operating cash outflows. "These factors raise substantial doubt about our ability to continue as a going concern," the Company said in the filing. As reported in the Troubled Company Reporter on March 26, 2010, MaloneBailey, LLP, in Houston, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2009 results. The independent auditors noted that Company has suffered an accumulated deficit of $6,949,006 as of Dec. 31, 2009. MaloneBailey's opinion on the Company's 2010 financial statements did not include a going concern qualification. A complete text of the Form 10-Q is available for free at: http://is.gd/CAVtrE Scottsdale, Ariz.-based America's Suppliers, Inc., develops software programs that allow the Company to provide general merchandise for resale to businesses through its website at www.DollarDays.com. AMERICAN POST: Incurs $470,700 Net Loss in First Quarter -------------------------------------------------------- American Post Tension, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $470,662 on $1.32 million of sales for the three months ended March 31, 2011, compared with a net loss of $415,094 on $2.48 million of sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.73 million in total assets, $3.50 million in total liabilities, all current, and a $1.77 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/rWGylt About American Post Henderson, Nev.-based American Post Tension, Inc., provides slab- on-grade post-tensioning products and services. In addition, the Company also provides materials to its customers on a freight-on- board ('FOB') basis so the buyer assumes the responsibility for the shipment and shipping charges of the materials purchased from the Company. As reported by the TCR on April 7, 2011, Moss, Krusick & Associates, LLC, in Winter Park, Florida, expressed substantial doubt about the American Post Tension's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses and operating cash outflows. The Company reported a net loss of $1.8 million on $7.0 million of sales for 2010, compared with a net loss of $1.9 million on $7.9 million of sales for 2009. AMTRUST FINANCIAL: Harbor-Led Auction for Parking Garage June 22 ---------------------------------------------------------------- The Hon. Pat Morgenstern-Clarren of the U.S. Bankruptcy Court for the Northern District of Ohio authorized AmTrust Financial Corp., now known as, AmFin Financial Corp., et al., to conduct an auction for a portion of their assets, where Harbor Group International LLC would be stalking horse bidder. As reported in the Troubled Company Reporter on May 5, 2011, Hilco Real Estate will run a sales process for a parking garage that includes ground floor retail and air rights for future development. The facility, which is located at 515 Euclid Avenue in downtown Cleveland, is owned by AmFin Real Estate Investments, Inc. A stalking horse agreement has been executed setting the minimum bid for the asset at $7,750,000. The property was constructed in 2005 at a cost in excess of $25 million. Hilco will receive a flat fee of $75,000 plus expenses for its services, together with a premium of 10% of any sale price received by the Debtors in excess of $7,500,000. The Debtors scheduled a June 22 auction for the assets at Tucker Ellis & West LLP, 1150 Huntington Building, 925 Euclid Avenue, Cleveland, Ohio. Qualified bids are due June 20, at 5:00 p.m. The Court will consider approval of the sale of the assets to Harbor Group or the winning bidder at a hearing on June 23 at 10:30 a.m. In the event of any competing bids for the assets, resulting in Harbor Group not being the successful Buyer, it will receive a breakup fee equal to 3% of the purchase price to be paid at the time of the closing of the sale with such third party buyer. Harbor Group is represented by Lawrence H. Bryant, Esq. -- lbryant@williamsmullen.com -- at William Mullens. Lenders to Submit Credit Bid Lenders U.S. Bank National Association, in its capacity as Indenture Trustee and RBS Citizens, National Association doing business as Charter One, asked that the Court authorize them to credit bid their approximately $12.7 million of senior mortgage indebtedness at the proposed auction of the property. The Court-approved bid procedures provide that U.S. Bank and RBS will be considered "qualified bidders" pursuant to 11 Sec. 363(K). RBS Citizens is represented by: Stuart A. Laven, Jr., Esq. BENESCH, FRIEDLANDER COPLAN & ARONOFF LLP 2300 BP Tower, 200 Public Square Cleveland, OH 44114-2378 Tel: (216) 363-4500 Fax: (216) 363-4588 E-mail: slaven@beneschlaw.com U.S. Bank National is represented by: Katherine Constantine, Esq. DORSEY & WHITNEY LLP Suite 1500, 50 South Sixth Street Minneapolis, MN 55402-1498 Tel: (612) 340-2600 Fax: (612) 340-2643 E-mail: constantine.katherine@dorsey.com About AmTrust Financial AmTrust Financial Corp (PINK: AFNL) was the owner of the AmTrust Bank. AmTrust was the seventh-largest holder of deposits in South Florida, with $4.7 billion in deposits and 21 branches. In November 2008, the Office of Thrift Supervision issued a cease and desist order requiring AmTrust to improve its capital ratios. AmTrust Financial, together with affiliates that include AmTrust Management Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 09-21323) on Nov. 30, 2009. The debtor subsidiaries include AmFin Real Estate Investments, Inc., formerly AmTrust Real Estate Investments, Inc. (Case No. 09- 21328). AmTrust disclosed $128,461,114 in assets and $261,400,098 in liabilities as of the Chapter 11 filing. G. Christopher Meyer, Esq., Christine M. Piepont, Esq., and Sherri L. Dahl, Esq., at Squire Sanders & Dempsey (US) LLP, in Cleveland, Ohio; and Stephen D. Lerner, Esq., at Squire Sanders & Dempsey (US) LLP, in Cincinnati, Ohio, serve as counsel to the Debtors in the Chapter 11 cases. Kurtzman Carson Consultants serves as claims and notice agent. Attorneys at Hahn Loeser & Parks LLP serve as counsel to the Official Committee of Unsecured Creditors. AmTrust Management estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. AmTrust Bank was not part of the Chapter 11 filings. On Dec. 4, 2009, AmTrust Bank was closed by regulators and the Federal Deposit Insurance Corporation was named receiver. New York Community Bank, in Westbury, New York, assumed all of the deposits of AmTrust Bank pursuant to a deal with the FDIC. AMTRUST FINANCIAL: June 10 Hearing on Disclosure Statement ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that although there is no conclusion yet to litigation with the Federal Deposit Insurance Corp. that will determine whether creditors receive anything at all, there will be a hearing on June 10 for approval of the explanatory disclosure statement explaining the proposed Chapter 11 plan for AmTrust Financial Corp. The disclosure statement and plan was amended mid April. Mr. Rochelle notes that for now, AmTrust has the upper hand with the FDIC. Last year, U.S. District Judge Donald C. Nugent in Cleveland ruled that documents were ambiguous as to whether the holding company was under a commitment to provide capital to the bank subsidiary. The FDIC claimed the unfulfilled commitment was $550 million. Mr. Rochelle recounts that at trial in April, a jury concluded there was no commitment and thus no right for the FDIC to collect $550 million from the AmTrust holding company, even though the bank failed four days after AmTrust filed under Chapter 11 in November 2009. After the district judge enters judgment for AmTrust, the holding company assumes the FDIC will appeal. The pendency of the appeal will prevent a distribution to creditors even if the plan is confirmed in the meantime. Mr. Rochelle adds that there is a second dispute with the FDIC over the entitlement to a $194 million tax refund for 2009 that the Internal Revenue Service is yet to pay. The FDIC claimed the right to collect all but $9 million of the refund. Since the tax refund is the largest asset, the outcome of the dispute will determine whether there is much to distribute to unsecured creditors, even if AmTrust beats back the FDIC on its claim for the $550 million. About AmTrust Financial AmTrust Financial Corp (PINK: AFNL) was the owner of the AmTrust Bank. AmTrust was the seventh-largest holder of deposits in South Florida, with $4.7 billion in deposits and 21 branches. In November 2008, the Office of Thrift Supervision issued a cease and desist order requiring AmTrust to improve its capital ratios. AmTrust Financial, together with affiliates that include AmTrust Management Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 09-21323) on Nov. 30, 2009. The debtor subsidiaries include AmFin Real Estate Investments, Inc., formerly AmTrust Real Estate Investments, Inc. (Case No. 09-21328). G. Christopher Meyer, Esq., Christine M. Piepont, Esq., and Sherri L. Dahl, Esq., at Squire Sanders & Dempsey (US) LLP, in Cleveland, Ohio; and Stephen D. Lerner, Esq., at Squire Sanders & Dempsey (US) LLP, in Cincinnati, Ohio, serve as counsel to the Debtors. Kurtzman Carson Consultants serves as claims and notice agent. Attorneys at Hahn Loeser & Parks LLP serve as counsel to the Official Committee of Unsecured Creditors. AmTrust Management estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. AmTrust Bank was not part of the Chapter 11 filings. On Dec. 4, 2009, AmTrust Bank was closed by regulators and the Federal Deposit Insurance Corporation was named receiver. New York Community Bank, in Westbury, New York, assumed all of the deposits of AmTrust Bank pursuant to a deal with the FDIC. A.M.Y. REALTY: Case Summary & 4 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: A.M.Y. Realty, Inc. 34 Hoffman Boulevard, 1st Floor East Orange, NJ 07017 Bankruptcy Case No.: 11-26497 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court District of New Jersey (Newark) Judge: Novalyn L. Winfield Debtor's Counsel: Bruce W. Radowitz, Esq. BRUCE W. RADOWITZ, ESQ. PA 636 Chestnut Street Union, NJ 07083 Tel: (908) 687-2333 E-mail: bradowitz@comcast.net Scheduled Assets: $500,000 Scheduled Debts: $1,050,000 A list of the Company's four largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/njb11-26497.pdf The petition was signed by Ajamu Kalonji, president. ANIKA AND ASSOCIATES: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Anika and Associates, Inc. 3890 Oakland Drive Bloomfield Hills, MI 48301-0000 Bankruptcy Case No.: 11-12407 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court Northern District of Mississippi (Aberdeen) Debtor's Counsel: Craig M. Geno, Esq. HARRIS JERNIGAN & GENO, PLLC P.O. Box 3380 Ridgeland, MS 39158-3380 Tel: (601) 427-0048 E-mail: cmgeno@hjglawfirm.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 Murray D. Wikol, president. ARK DEVELOPMENT: BB&T Wants to Pursue Collateral Remedies --------------------------------------------------------- Branch Banking and Trust Company, a North Carolina banking corporation, asks the U.S. Bankruptcy Court for the Southern District of Florida to modifying the automatic stay on Ark Development/Oceanview, LLC's assets. BB&T is successor-in-interest to Colonial Bank by asset acquisition from the FDIC as receiver for Colonial Bank. BB&T holds a first priority mortgage on the Debtor's property located in Broward County, Florida. On Oct. 6, 2010, BB&T instituted a foreclosure action against the collateral due to, among other defaults, the Debtor's failure to make payments on the underlying promissory note. As of the Petition Date, the Debtor owed BB&T $3,478,006. BB&T seeks permission to complete its state court foreclosure action against the Debtor's real property located in Broward County, Florida. In the alternative, BB&T requests the Court enter an order conditioning the continuance of the automatic stay on the Debtor providing adequate protection to BB&T. BB&T explains that its interest in the collateral is not adequately protected because the Debtor continues to hold and use the collateral, while failing to make payments under the note and mortgage, failing to pay real estate taxes, and failing to record necessary easements to allow access to the collateral. In addition, the value of the collateral is unstable and at risk of continued depreciation. BB&T is represented by: W. Glenn Jensen, Esq. Alan J. Perlman, Esq. David J. Lienhart, Esq. ROETZEL & ANDRESS 420 South Orange Avenue CNL II, 7th Floor Orlando, FL 32801 Tel: (407) 896-2224 Fax: (407) 835-3596 E-mail: gjensen@ralaw.com aperlman@ralaw.com dlienhart@ralaw.com About Ark Development/Oceanview Ark Development/Oceanview LLC owns three pieces luxury homes in Fort Lauderdale, Florida -- at 1431 North Atlantic Boulevard; 1427 North Atlantic Boulevard; and 1423 North Atlantic Boulevard. All three properties are in the final stages of the construction process. The Debtor estimates that the value of each property is roughly $4 million. Ark Development/Oceanview filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 11-20382) on April 18, 2011. Judge John K. Olson presides over the case. It scheduled assets of $12,000,000 and debts of $9,772,531. AVI PROPERTIES: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: AVI Properties, LLC c/o Valerie Paz 4241 Jutland Drive, #308 San Diego, CA 92117 Bankruptcy Case No.: 11-27125 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Central District of California (Riverside) Judge: Scott C. Clarkson Debtor's Counsel: Stuart J. Wald, Esq. LAW OFFICES OF STUART J. WALD 36154 Coffee Tree Place Murrieta, CA 92562 Tel: (310) 429-3354 E-mail: stuart.wald@gmail.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 The list of unsecured creditors filed together with its petition does not contain any entry. The petition was signed by Abraham (Avi) Greenboim, managing member. AXIOM MANAGEMENT: Files Chapter 7 Petition ------------------------------------------ BankruptcyData.com reports that Axiom Management filed for Chapter 7 protection (Bankr. C.D. Calif. Case No. 11-32807) in Los Angeles, California. The staff recruitment company is represented by Benjamin Nachimson of the Law Offices of Benjamin Nachimson. BALLY TOTAL: Contra Costa Retail Dispute Goes to State Court ------------------------------------------------------------ SyWest Development, in its capacity as asset manager for Contra Costa Retail Center, LLC, the defendant in the adversary proceeding, BALLY TOTAL FITNESS CORPORATION, v. CONTRA COSTA RETAIL CENTER, LLC, Adv. Proc. No. 09-01350 (Bankr. S.D.N.Y.), asked the Bankruptcy Court to (i) permissively abstain from hearing the Adversary Proceeding pursuant to, inter alia, 28 U.S.C. Sec. 1334(c)(1) and Federal Rule of Bankruptcy Procedure 5011; and (ii) dismiss the Adversary Proceeding pursuant to Bankruptcy Rule 7012. In a May 24, 2011 Bench Memorandum Decision, Bankruptcy Judge Burton R. Lifland granted the Motion to Abstain, rendering the Motion to Dismiss moot. The main contention between the parties is whether a certain lease of Bally Total Fitness Corporation terminated prepetition under California law and may no longer be assumed. A California trial court found that Bally breached and must forfeit the lease; the decision was upheld on appeal. Bally, no longer able to contest its breach, commenced the Adversary Proceeding before the Bankruptcy Court, seeking application of a California anti- forfeiture statute that prevents forfeiture of a breached lease in "case of hardship." According to Judge Lifland, while Bally's Adversary Proceeding may be considered by the Bankruptcy Court, its resolution is more appropriate for the California state court, pointing out that: -- the Adversary Proceeding is merely an offshoot of the California state court proceeding involving the same parties, lease, and premises, all present in California. -- as the Adversary Proceeding is essentially an equitable appeal of the California state court's decision, notions of comity suggest that the California state court, itself, should decide it. -- as the Bankruptcy Court has already ordered that the lease be assumed pending resolution of the litigation in California, the dispute solely involves state law issues. -- as Bally's chapter 11 plan has gone effective, resolution of the Adversary Proceeding will not greatly impact administration of the bankruptcy estate. A copy of Judge Lifland's decision is available at http://is.gd/5gSizcfrom Leagle.com. About Bally Total Fitness Bally Total Fitness operates nearly 300 fitness centers across the United States. With more than 3 million active members and over 30 years of experience, Bally is among the most popular health club brands in America. The professionals at Bally Total Fitness help motivate members to improve their physical health and reach their personal fitness goals with many affordable membership choices -- including options with no long-term commitment. Bally Total and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 07-12396) on July 31, 2007 after obtaining requisite number of votes in favor of their pre- packaged Chapter 11 plan. The Bankruptcy Court confirmed the Company's Chapter 11 plan and the Company emerged from bankruptcy Oct. 1, 2007. Bally Total Fitness Holding Corp. and its debtor-affiliates and subsidiaries again filed voluntary petitions under Chapter 11 (Bankr. S.D.N.Y., Lead Case No. 08-14818) on Dec. 3, 2008. Their counsel is Kenneth H. Eckstein, Esq., at Kramer Levin Naftalis & Frankel LLP, in New York. As of Sept. 30, 2008, the Company (including non-debtor affiliates) had consolidated assets totaling approximately $1.376 billion and recorded consolidated liabilities totaling approximately $1.538 billion. Bally Total Fitness Holding and its 42 debtor-affiliates delivered their Joint Plan of Reorganization and Disclosure Statement to the Bankruptcy on June 10, 2009. The Plan was confirmed Aug. 19, 2009, and the Company emerged from bankruptcy Sept. 1, 2009. BERNARD L. MADOFF: Mets Owner Want Suit in District Court --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Fred Wilpon asked a U.S. district judge to snatch a lawsuit out of the hands of bankruptcy court, where the trustee for Bernard L. Madoff Investment Securities Inc. is seeking to recover $1 billion from him, New York Mets owner Sterling Equities Inc. and Wilpon's friends, family and associates. According to the report, Mr. Wilpon argued in a filing yesterday that the district court must take over the lawsuit because it involves significant interpretation of unresolved issues of federal law other than bankruptcy law. He also claimed there is conflict between the U.S. Bankruptcy Code and federal securities law. The trustee is seeking to recover $300 million in fictitious profits and $700 million in principal the Wilpon group was able to take out of the Madoff firm before the fraud surfaced publicly. Mr. Rochelle relates that Mr. Wilpon contended that the trade confirmations and account statements he received represented evidence of legal ownership of securities that the trustee cannot upset under bankruptcy law. He also argued that payments he received were protected by the so-called safe harbor provisions in bankruptcy law. Under those parts of the Bankruptcy Code, payments in settlement of securities transactions cannot be set aside by bankruptcy judges. Mr. Wilpon already has a motion pending seeking dismissal of the lawsuit. If a district judge takes away the lawsuit soon enough, that judge would decide the dismissal motion. 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. BLOCKBUSTER CANADA: Closing Some Stores in GOB Sales ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Blockbuster Canada Co. was authorized by the Canadian judge to begin going-out-of-business sales at some stores. The receiver's statement didn't say how many are closing. The receiver, Grant Thornton Ltd., said it is looking for a buyer of the "assets and operations." About Blockbuster Canada Blockbuster Canada Co., an indirect subsidiary of Blockbuster Inc., went into receivership in Canada on May 3, 2011. Grant Thornton Limited was appointed by the Ontario Superior Court of Justice. Michael Creber, on behalf of Grant Thornton Ltd., commenced a Chapter 15 case for Blockbuster Canada (Bankr. S.D.N.Y. Case No. 11-12433) in Manhattan on May 20, 2011, to seek the U.S. court's recognition of the receivership proceedings in Canada. Robert J. Feinstein, Esq., at Pachulski Stang Ziehl & Jones LLP, serves as counsel in the Chapter 15 case. Blockbuster Canada is estimated to have $50,000,001 to $100,000,000 in assets and liabilities. Blockbuster Inc., the movie rental chain with a library of more than 125,000 titles, along with 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. Martin A. Sosland, Esq., and Stephen Karotkin, Esq., at Weil, Gotshal & Manges, serve as counsel to the U.S. 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. The Official Committee of Unsecured Creditors retained Cooley LLP as its counsel. In April 2011, Blockbuster conducted a bankruptcy court sanctioned auction for all the assets. Dish Network Corp. won with an offer having a gross value of $320 million. BERNARD L. MADOFF: Trustee Responds to Wilpon's Dismissal Plea -------------------------------------------------------------- Irving H. Picard, the Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC filed his opposition brief in the United States Bankruptcy Court for the Southern District of New York against the motion by Sterling Equities, its partners, their family members, and certain related trusts and entities seeking either the dismissal of the Trustee's complaint against them or summary judgment. In the opposition brief, the Trustee describes two critical components of the fiduciary mandate which form the basis of his claims against the Sterling Defendants. The first is to locate and recover fictitious profits, or "other people's money," that the Sterling Defendants received from BLMIS and to redistribute those assets equitably to those who withdrew less than they deposited. The second critical component of the Trustee's claims against the Sterling Defendants emanates from the bankruptcy law concept of good faith. A lack of good faith under the bankruptcy law does not require that the defendant actually did something illegal or knew that it was dealing with a Ponzi scheme. Instead, under bankruptcy law, a defendant did not act in good faith if what it knew about BLMIS gave it a reason to inquire further, but instead it turned a blind eye and continued to take money from an enterprise it should have known might be a fraud. "Fred Wilpon, Saul Katz and the Sterling Partners are holding $300 million in fictitious profits consisting of 'other people's money,' stolen money that they received from Bernard Madoff. Yet they refuse to return this stolen money," said David J. Sheehan, counsel to the Trustee and a partner at Baker & Hostetler LLP, the court-appointed counsel for the Trustee. "This case is one of many actions undertaken by the Trustee to fulfill his fiduciary obligation to return stolen money to the rightful owners, who are BLMIS customers and creditors with approved claims," said Mr. Sheehan. "As today's filing shows, the law and the facts verify the Trustee's allegations against the Sterling Defendants. There is no rationale -- in law or in fact - - that justifies their retention of stolen money." The opposition brief submits evidence -- including information and testimony presented for the first time -- which substantiates the Trustee's allegations against the Sterling Defendants, including that they disregarded warnings from trusted advisors and their own suspicions that BLMIS might be a fraud, because they were "fixated on continuing to profit from their access to Madoff and his returns." "The law does not permit 'bad faith' investors to retain money they received from an enterprise after indicia of possible fraud becomes apparent," said Fernando A. Bohorquez, Jr., counsel to the Trustee and a partner at Baker & Hostetler LLP. "Even if the Sterling Defendants did not specifically know that BLMIS was a Ponzi scheme, they cannot keep the hundreds of millions of dollars in principal transfers they received under circumstances indicating that they should have known of possible fraud at BLMIS." The Sterling Defendants must return to the Trustee all of the money that they received from BLMIS if they were on notice of facts suggesting that BLMIS might be a fraud, but failed to conduct a diligent investigation. The Trustee's pre-complaint investigation yielded evidence that shows that the Sterling Defendants were aware that BLMIS might have been a fraud but failed to investigate, including: -- In 2001, the Sterling Partners explored purchasing "fraud insurance" for their BLMIS investments that would cover a Ponzi scheme; -- Sterling Partner David Katz's own testimony that by 2002, he was "screaming for diversification" of the Sterling Partners' investments away from Madoff because "we don't know what he does" and so created their own hedge fund, Sterling Stamos, to achieve "Madoff-like returns"; -- Testimony of one of the Sterling Partners that he had heard Madoff might be front-running, which he understood meant that Madoff might be taking "information and us[ing] it illegally to his own benefit or to benefit his clients"; -- Testimony that the Sterling Partners were warned by their hedge fund business partners of the danger that their hundreds of millions of dollars at BLMIS could be frozen if there were an investigation into Madoff's operations. Sterling Stamos Documents and Testimony Show that the Sterling Partners Were Warned Of particular note, the opposition brief provides more detail from the testimony of Peter Stamos, the chief executive officer of Sterling Stamos, the hedge fund co-founded by Mr. Stamos and the Sterling Partners. After describing his high opinion of Madoff, Peter Stamos in the very next breath stated that Sterling Stamos's due diligence protocols would have "stopped [Madoff] at the door" and that he conveyed this information to a Sterling Partner. Within days of the collapse of BLMIS, there were written communications from Sterling Stamos stating that they had recommended to the Sterling Partners for years that they should have taken their money out of BLMIS, but that they had refused to do so despite these warnings. In particular, a December 2008 email by Sterling Stamos's chief investment strategist read: "In fact, we had recommended to them [Sterling Partners] to redeem [from BLMIS] for years but they kept their investment independent of our recommendation." Before the collapse of the Madoff Ponzi scheme, other credible investment advisors expressed similar misgivings to the Sterling Partners about Madoff, including: -- A Merrill Lynch executive who told Saul Katz that Madoff would not pass Merrill Lynch's due diligence process; -- A consultant to the Sterling Defendants who told Saul Katz that he "couldn't make Bernie's math work" and "Something wasn't right." "Instead of listening to the advice of their own, hand-picked hedge fund managers and other advisors, the Sterling Defendants restructured Sterling Stamos to accommodate Madoff's unorthodox demands for secrecy," said Mr. Sheehan. "Peter Stamos's testimony confirms that, to appease Madoff's desire to avoid disclosures regarding the Sterling Partners' investments with BLMIS, Sterling Stamos's operations and management were entirely restructured at great time and expense." Bayou Fund Ponzi Scheme -- A Lesson Ignored In addition to warnings from experienced investment advisors, the Sterling Partners had previous experience with another Ponzi scheme in 2005. The Trustee's opposition brief details the lessons that the Sterling Partners should have learned from the Bayou Fund Ponzi scheme and that they should have applied to Madoff, but deliberately failed to do so. "The facts are undeniable and inescapable. The Sterling Partners used their BLMIS accounts and the consistent, steady returns as a source of liquidity for their various businesses, including the Mets. They also used their BLMIS accounts for leverage, borrowing against them to obtain additional capital which they then reinvested into their BLMIS accounts to double their returns," said Mr. Sheehan. "As our evidence shows, the Sterling Defendants were aware of and ignored indicia of fraud, despite a series of escalating warnings about Madoff. Of this there is no doubt." The Sterling complaint was initially filed under seal on December 7, 2010 in the United States Bankruptcy Court for the Southern District of New York. The original complaint was unsealed on February 4, 2011, at the Trustee's request, and amended on March 18, 2011. 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. BIO-KEY INTERNATIONAL: Earns $240,200 in First Quarter ------------------------------------------------------ BIO-key International, Inc., filed its quarterly report on Form 10-Q, reporting net income of $240,171 on $1.4 million of revenues for the three months ended March 31, 2011, compared with net income of 1.0 million on $976,175 of revenues for the same period last year. During the period ended March 31, 2010, the Company recorded net income from discontinued operations of approximately $435,000 from the sale of its Law Enforcement division to InterAct911 Mobile Systems, Inc., which closed on Dec. 8, 2009. The Company's balance sheet at March 31, 2011, showed $5.5 million in total assets, $4.7 million in total liabilities, and stockholders' equity of $836,544. As reported in the TCR on March 29, 2011, Rotenberg Meril Solomon Bertiger & Guttilla, P.C., in Saddle Brook, New Jersey, expressed substantial doubt about BIO-key's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered substantial net losses in recent years, and has an accumulated deficit at Dec. 31, 2010. A full-text copy of the Form 10-Q is available for free at: http://is.gd/hbx8aA Wall, N.J.-based BIO-key International, Inc. (OTC BB: BKYI) -- http://www.bio-key.com/-- develops and delivers advanced identification solutions to commercial and government enterprises, integrators, and custom application developers. BIOCORAL, INC: Incurs $200,607 Net Loss in First Quarter -------------------------------------------------------- Biocoral, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $200,607 on $62,496 of net sales for the three months ended March 31, 2011, compared with a net loss of $183,654 on $82,454 of net sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.62 million in total assets, $6.56 million in total liabilities and $4.94 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/W9Nvs7 About Biocoral, Inc. Headquartered in La Garenne Colombes, France, Biocoral, Inc. -- http://www.biocoral.com/-- was incorporated under the laws of the State of Delaware on May 4, 1992. Biocoral is a holding company that conducts its operations primarily through its wholly- owned European subsidiaries. The Company's operations consist primarily of research and development and manufacturing and marketing of patented high technology biomaterials, bone substitute materials made from coral, and other orthopedic, oral and maxillo-facial products, including products marketed under the trade name of Biocoral. Most of the Company's operations are conducted from Europe. The Company has obtained regulatory approvals to market its products throughout Europe, Canada and certain other countries. The Company owns various patents for its products which have been registered and issued in the United States, Canada, Japan, Australia and various countries throughout Europe. However, the Company has not applied for the regulatory approvals needed to market its products in the United States. As reported by the TCR on April 11, 2011, Michael T. Studer CPA P.C., in Freeport, New York, expressed substantial doubt about Biocoral's ability to continue as a going concern. Mr. Studer noted that the Company had net losses of approximately $703,300 and $452,600 in 2010 and 2009, respectively. "The Company had a working capital deficiency of approximately $2,125,700 and $1,585,300, at Dec. 31, 2010, and 2009, respectively. The Company also had a stockholders' deficit of approximately $4,734,700 and $4,040,800 at Dec. 31, 2010, and 2009, respectively." The Company reported a net loss of $703,272 on $307,655 of sales for 2010, compared with a net loss of $452,592 on $425,055 of sales for 2009. BION ENVIRONMENTAL: Names Dominic Bassani as Interim CEO -------------------------------------------------------- Dominic Bassani has become Bion Environmental Technologies, Inc.'s Interim CEO effective May 13, 2013. Mr. Bassani has served the Company in various executive capacities since 2000. Mr. Bassani and the Company have agreed to negotiate, during the next three months, an extension/amendment of the existing agreement with Bright Capital, Ltd., pursuant to which Mr. Bassani currently serves the Company. Effective May 13, 2011, William O'Neill has resigned from his positions as Director and CEO of the Company. As the result of Mr. O'Neil's resignation, his employment agreement has been terminated and, pursuant to its terms, 679,688 options granted to Mr. O'Neill have been cancelled and 70,312 options remain outstanding and vested. Mr. O'Neill will assist the Company on an 'as needed' basis to insure a smooth transition. 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. 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. BMF INVESTMENTS: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: BMF Investments, LLC 120 W. Jefferson Avenue Wildwood, NJ 08260 Bankruptcy Case No.: 11-26179 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court District of New Jersey (Camden) Judge: Judith H. Wizmur Debtor's Counsel: Douglas S. Stanger, Esq. FLASTER GREENBERG PC - LINWOOD 646 Ocean Heights Avenue Linwood, NJ 08221 Tel: (609) 645-1881 Fax: (609) 645-9932 E-mail: doug.stanger@flastergreenberg.com Scheduled Assets: $9,000,000 Scheduled Debts: $8,567,830 A list of the Company's eight largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/njb11-26179.pdf The petition was signed by William H. Morey, Jr., general manager. BROWNIE'S MARINE: Posts $273,400 Net Loss in 1st Quarter -------------------------------------------------------- Brownie's Marine Group, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $273,404 on $362,900 of revenues for the three months ended March 31, 2011, compared with a net loss of $160,154 on $464,183 of revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.9 million in total assets, $2.3 million in total liabilities, and a stockholders' deficit of $376,419. A copy of the Form 10-Q is available at http://is.gd/M5okmH About Brownie's Marine Brownie's Marine Group, Inc. (OTC BB: BWMG) -- http://www.brownismarinegroup.com/-- designs, tests, manufactures and distributes recreational hookah diving, yacht based scuba air compressor and nitrox generation systems, and scuba and water safety products. BWMG sells its products both on a wholesale and retail basis, and does so from its headquarters and manufacturing facility in Fort Lauderdale, Florida. The Company reported a net loss of $1.2 million on $2.2 million of revenues for 2010, compared with a net loss of $451,227 on $2.4 million of revenues for 2009. A copy of the Form 10-K is available at http://is.gd/J2Llb1 L.L Bradford & Company, LLC, in Las Vegas, Nevada, expressed substantial doubt about Brownie's Marine Group's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has a working capital deficiency and recurring losses and will need to secure new financing or additional capital in order to pay its obligations. C 300: Voluntary Chapter 11 Case Summary ---------------------------------------- Debtor: C 300, LLC Squire, Sanders & Dempsey (US) LLP 1 East Washington, Suite 2700 Phoenix, AZ 85004 Bankruptcy Case No.: 11-15542 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Randolph J. Haines Debtor's Counsel: Thomas J. Salerno, Esq. SQUIRE, SANDERS & DEMPSEY (US) LLP 1 E Washington St. #2700 Phoenix, AZ 85004 Tel: (602) 528-4043 Fax: (602) 253-8129 E-mail: tsalerno@ssd.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $0 to $50,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Jerry Midzor, member. C-SWDE348 LLC: Proposes Bogatz & Associates as Attorneys -------------------------------------------------------- C-SWDE348, LLC, obtained permission from the U.S. Bankruptcy Court for the District of Nevada to employ Bogatz & Associates, P.C. as its bankruptcy counsel. Scott Bogatz, an attorney at B&A, charges $450 per hour for his services. On March 7, 2011, B&A entered into a written engagement agreement with the Debtor. That agreement provides that B&A be paid a flat fee of $7,500 by the Debtor for providing legal services to the Debtor in this case. To the best of the Debtor's knowledge, B&A is a "disinterested person" within the meaning of Section 101(14) of the bankruptcy code. About C-SWDE348 Las Vegas, Nevada-based C-SWDE348, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11-13942) on March 21, 2011. Scott Bogatz, Esq., at Bogatz & Associates, P.C., serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates B-SWDE3, LLC (Bankr. D. Nev. Case No. 09-29051) and four affiliates filed for bankruptcy in 2009. B-NWI1, LLC (Case No. 10-15774) and nine other related entities sought bankruptcy protection in 2010. B-SCT1, LLC (Case No. 11-11560) and G-SWDE1, LLC (Case No. 11-11991) filed Chapter 11 petitions in February 2011. C-NW361, LLC, and five other affiliates sought bankruptcy protection in March 2011. CAESARS ENTERTAINMENT: S&P Assigns 'B' Rating to $1.2BB Term Loan ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its issue-level rating to Caesars Entertainment Operating Co. Inc.'s (CEOC) new $1.2 billion senior secured term loan, due 2018. "We assigned the first-lien term loan our 'B' issue-level rating (one notch higher than our 'B-' corporate credit rating on the company) with a recovery rating of '2', indicating our expectation for substantial (70%-90%) recovery for lenders in the event of a payment default," S&P related. "Our 'B-' corporate credit rating and stable rating outlook on CEOC and its parent company, Caesars Entertainment Corp. (Caesars), are unaffected by the proposed transaction," S&P noted. "The 'B-' corporate credit rating reflects Caesars' very weak credit measures and our belief that prospects for a meaningful rebound in net revenues and EBITDA in 2011 do not seem promising given the current economic outlook," said Standard & Poor's credit analyst Ben Bubeck. "While several actions taken by management have positioned the company with a moderate covenant cushion and very limited debt maturities over the next few years, Caesars' capacity to continue to fund operational and capital spending needs and meet debt service obligations relies on meaningful growth in cash flow generation over the next few years." "Although the amend and extend transaction improves Caesars' already strong debt maturity profile, we believe the increased interest rate that will be received by extending lenders will weigh on the company's liquidity profile, given weak EBITDA coverage of interest of just 0.9x as of March 31, 2011. We expect EBITDA to begin to grow this year following three years of moderate declines. However, absent meaningful growth in EBITDA over the next few years, Caesars will likely burn substantial cash to meet capital expenditure needs and may be challenged to continue to meet long-term debt service obligations. The amendment also allows Caesars to buy back loans from individual lenders at a price that may be below par. Given the company's very weak financial profile, we would likely view buybacks at a price meaningfully below par as tantamount to a default and lower our issue-level ratings on this debt in accordance with our distressed exchange criteria," S&P elaborated. CANNERY CASINO: S&P Affirms 'B-' CCR; Outlook Revised to Stable --------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on Las Vegas-based Cannery Casino Resorts LLC to stable from negative. "We also affirmed our 'B-' corporate credit rating and all issue-level ratings on the company," S&P stated. "Our outlook revision to stable reflects Cannery's outperformance relative to our expectations in recent periods," explained Standard & Poor's credit analyst Melissa Long. "In 2010, net revenue was essentially flat and EBITDA grew in the low single digit percentage area, compared to our expectation for a low-teens percentage decline in EBITDA. Furthermore, Cannery continued to perform well through the first quarter of 2011, with a high-single-digit percentage increase in net revenue and a roughly 40% increase in EBITDA. Cannery's improving operating performance has led to increased covenant cushion under its total leverage covenant and we believe the cushion, in conjunction with our updated operating performance expectations, should allow Cannery to meet quarterly step-downs scheduled over the next two years. Additionally, although the company's $70 million revolver matures in May 2012, we believe the company is in the position to successfully address this maturity based on operating trends and our expectations for credit measures and cash flow generation," S&P noted. "Our rating incorporates an expectation that EBITDA in 2011 will increase by about 10%, largely driven by our performance assumptions for the company's Meadows Casino in Pennsylvania. Meadows accounts for almost two-thirds of Cannery's EBITDA. We have factored in an expectation that Meadows' EBITDA will grow around 20% in 2011 as the property will continue to realize the benefit from the addition of table games through the first half of 2011. The property also benefits from a lower tax rate on table game revenue as compared to slot revenue. In the second half of 2011 following the anniversary of tables and in 2012, we expect moderate levels of revenue and EBITDA growth," according to S&P. "Our 'B-' corporate credit rating reflects Cannery Casino Resorts LLC's highly leveraged financial profile, the competitive dynamics of the Las Vegas locals market, and our expectation that the U.S. economy will only gradually improve over the next few years. Still, the company's cash flow diversification from operating in two markets on opposite sides of the country and its experienced management team, with a proven track record within the gaming industry, somewhat temper these negative rating factors," S&P added. CAPSALUS CORP: Incurs $966,500 Net Loss in First Quarter -------------------------------------------------------- Capsalus Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $966,482 on $0 of net sales for the three months ended March 31, 2011, compared with a net loss of $911,408 on $0 of net sales for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $4.67 million in total assets, $5.29 million in total liabilities, and a $617,587 total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/7tLaO9 About Capsalus Corp. Atlanta, Ga.-based Capsalus Corp. offers a broad range of solutions to global health problems. WhiteHat Holdings, LLC, was acquired on April 14, 2010. In combining with WhiteHat, the Company is creating a new, consumer-driven business unit, the Nutritional Products Division, focused on healthy food and beverages. The Company reported a net loss of $16.02 million for the year ended Dec. 31, 2010, compared with a net loss of $10.89 million during the prior year. The Company has not generated any operating revenues from its continuing operations, and as of Dec. 31, 2010, it had incurred a cumulative consolidated net loss from inception of $30.66 million. As reported by the TCR on April 21, 2011, Moquist Thorvilson Kaufmann Kennedy & Pieper LLC, in Edina, Minnesota, expressed substantial doubt about the Company's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has suffered losses from operations since its inception. CARDO MEDICAL: Posts $321,000 Net Loss in March 31 Quarter ---------------------------------------------------------- Cardo Medical, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $321,000 for the three months ended March 31, 2011, compared with a net loss of $1.5 million for the same period last year. The Company had no revenue from continuing operations for the three months ended March 31, 2011, and 2010. The Company's balance sheet at March 31, 2011, showed $5.5 million in total assets, $2.5 million in total liabilities, and stockholders' equity of $3.0 million. As reported in the TCR on April 11, 2011, Marcum LLP, in Los Angeles, Calif., expressed substantial doubt about Cardo Medical's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has continuing losses from operations, negative cash flows and limited cash to fund future operations. A copy of the Form 10-Q is available at http://is.gd/aS5pnv Van Nuys, Calif.-based Cardo Medical, Inc. (OTC BB: CDOM) -- http://www.cardomedical.com/-- has formerly operated as an orthopedic medical device company specializing in designing, developing and marketing high performance reconstructive joint devices and spinal surgical devices. In January 2011 the Company entered into an asset purchase agreement to sell substantially all of its assets in the Reconstructive Division to Arthrex, Inc. The Company expects to complete the sale of the Reconstructive Division assets during the second quarter of 2011. Additionally, the Company has completed the sale of substantially all of the assets in the Spine Division in April 2011. CASA GRANDE: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Casa Grande Land Equity Investors Limited Partnership II 6133 E. Joshua Tree Lane Phoenix, AZ 85253 Bankruptcy Case No.: 11-15277 Chapter 11 Petition Date: May 26, 2011 Court: U.S. Bankruptcy Court District of Arizona (Phoenix) Judge: Charles G. Case, II Debtor's Counsel: Mark W. Roth, Esq. POLSINELLI SHUGHART P.C. One East Washington Street CityScape Building, Suite 1200 Phoenix, AZ 85004 Tel: (602) 650-2012 Fax: (602) 926-8562 E-mail: mroth@polsinelli.com Estimated Assets: $0 to $50,000 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 John Deakin, managing general partner. CENTRAL LEASING: Section 341(a) Meeting Scheduled for June 10 ------------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of Central Leasing Co., of NJ, LLC's creditors on June 10, 2011, at 3:00 p.m., at the Office of the US Trustee, Raymond Blvd., One Newark Center, Suite 1401, in Newark, New Jersey. 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 Central Leasing Midland Park, New Jersey-based Central Leasing Co. of NJ, LLC, leases machinery and equipment. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case No. 11-11917) on Jan. 24, 2011. The Debtor disclosed $12,212,082 in assets and $10,229,575 in liabilities as of the Chapter 11 filing. CENTURION PROPERTIES: Can Employ Gibbons & Riely as Appraiser ------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Washington has granted Centurion Properties III LLC PERMISSION to employ Gibbons & Riely PLLC as appraiser to assist the Debtor in setting the market value of the Debtor's property. The firm will bill $285 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 Centurion Properties Kennewick, Washington-based Centurion Properties III, LLC, was established in 2006 for the sole purpose of acquiring, owning, operating and managing the real estate project known as the Battelle Leaseholds located in Richland, Washington. Its sole asset is its leasehold interests in the Battelle Memorial Institute Campus and improvements, valued in excess of $90 million. CPIII filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wash. Case No. 10-04024) on July 9, 2010. John D. Munding, Esq., at Crumb & Munding, assists the Company in its restructuring effort. The Company estimated its assets and debts at $50 million to $100 million. The United States Trustee was unable to appoint a creditors committee in the case. CENTURION PROPERTIES: Taps Lukins & Annis as Special Counsel ------------------------------------------------------------ Centurion Properties III LLC asks the U.S. Bankruptcy Court for the Eastern District of Washington for permission to employ Michael J. Hines at Lukins & Annis as special counsel to render legal services related to the Debtor's pending litigation. Lukin & Annis will be paid based on the rates of its professionals: Professionals Hourly Rates ------------- ------------ Michael J. Hines, Esq. $330 Michael D. Franklin, Esq. $250 Laura Black, Esq. $220 The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Centurion Properties Kennewick, Washington-based Centurion Properties III, LLC, was established in 2006 for the sole purpose of acquiring, owning, operating and managing the real estate project known as the Battelle Leaseholds located in Richland, Washington. Its sole asset is its leasehold interests in the Battelle Memorial Institute Campus and improvements, valued in excess of $90 million. CPIII filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wash. Case No. 10-04024) on July 9, 2010. John D. Munding, Esq., at Crumb & Munding, assists the Company in its restructuring effort. The United States Trustee has been unable to appoint a creditors committee in the case. The Company estimated its assets and debts at $50 million to $100 million. CHRISTIAN BROTHERS: Taps Tarter Krinsky as Gen. Bankruptcy Counsel ------------------------------------------------------------------ The Christian Brothers' Institute and The Christian Brothers of Ireland, Inc., sought and obtained approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Tarter Krinsky & Drogin LLP as their general bankruptcy counsel. The firm can be reached at: Scott S. Markowitz, Esq. Ira R. Abel, Esq. TARTER KRINSKY & DROGIN LLP 1350 Broadway, 11th Floor New York, New York 10018 Tel.: (212) 216-8000 E-mail: smarkowitz@tarterkrinsky.com iabel@tarterkrinsky.com As the Debtors' general bankruptcy counsel, the firm will: (a) give advice to the Debtors with respect to their powers and duties as debtors-in-possession in the continued management of their properties; (b) negotiate with creditors of the Debtors in working out a plan of reorganization, and to take necessary legal steps in order to confirm said plan of reorganization, including, if need be, negotiations in financing a plan of reorganization; (c) prepare on behalf of the Debtors, as debtors-in- possession, necessary applications, answers, orders, reports and other legal papers; (d) appear before the bankruptcy judge and to protect the interests of the debtors-in-possession before the bankruptcy judge, and to represent the Debtors in all matters pending in the Chapter 11 cases; and (e) perform all other legal services for the Debtors, as debtors-in-possession, that may be necessary. The Debtors desire to employ TKD under a general retainer because of the extensive legal services required. Scott S. Markowitz, Esq., a partner at Tarter Krinsky & Drogin LLP, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Christian Brothers' Institute The Christian Brothers' Institute in New Rochelle, New York, is a domestic not-for-profit 501(c)(3) corporation organized under Sec. 102(a)(5) of the New York Not-for-Profit Corporation Law. CBI was formed to establish, conduct and support Catholic elementary and secondary schools principally throughout New York State. The Christian Brothers of Ireland, Inc., in Chicago, Illinois, is a domestic not-for-profit 501(c)(3) corporation organized under the Not-for-Profit Corporation Law of the State of Illinois. CBOI was formed to establish, conduct and support Catholic elementary and secondary schools principally throughout the State of Illinois, as well as other spiritual and temporal affairs of the former Brother Rice Province of the Congregation of Christian Brothers. CBI and CBOI depend upon grants and donations to fund a portion of their operating expenses. The Christian Brothers' Institute and The Christian Brothers of Ireland filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case Nos. 11-22820 and 11-22821) on April 28, 2011. Scott S. Markowitz, Esq., at Tarter Krinsky & Drogin LLP, serves as the Debtors' bankruptcy counsel. CBI estimated its assets at $50 million to $100 million and debts at $1 million to $10 million. CBOI estimated its assets at $500,000 to $1 million and debts at $1 million to $10 million. No official committee of unsecured creditors has been appointed. CHRISTIAN BROTHERS: U.S. Trustee Forms Creditors Committee ---------------------------------------------------------- Tracy Hope Davis, the United States Trustee for Region 2, under 11 U.S.C. Sec. 1102(a) and (b), appointed seven unsecured creditors who are willing to serve on an official committee of unsecured creditors in the Chapter 11 cases of The Christian Brothers' Institute and affiliated debtors in possession. The Creditors Committee members are: 1. William Shanks 2. Thomas James 3. Joseph Shanks 4. Edwin Fowler 5. James J. Eason 6. William Williams 7. Patrick Cullinan About Christian Brothers' Institute The Christian Brothers' Institute in New Rochelle, New York, is a domestic not-for-profit 501(c)(3) corporation organized under Sec. 102(a)(5) of the New York Not-for-Profit Corporation Law. CBI was formed to establish, conduct and support Catholic elementary and secondary schools principally throughout New York State. The Christian Brothers of Ireland, Inc., in Chicago, Illinois, is a domestic not-for-profit 501(c)(3) corporation organized under the Not-for-Profit Corporation Law of the State of Illinois. CBOI was formed to establish, conduct and support Catholic elementary and secondary schools principally throughout the State of Illinois, as well as other spiritual and temporal affairs of the former Brother Rice Province of the Congregation of Christian Brothers. CBI and CBOI depend upon grants and donations to fund a portion of their operating expenses. The Christian Brothers' Institute and The Christian Brothers of Ireland filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case Nos. 11-22820 and 11-22821) on April 28, 2011. Scott S. Markowitz, Esq., at Tarter Krinsky & Drogin LLP, serves as the Debtors' bankruptcy counsel. CBI estimated its assets at $50 million to $100 million and debts at $1 million to $10 million. CBOI estimated its assets at $500,000 to $1 million and debts at $1 million to $10 million. CIT GROUP: $15.8 Billion Swap Seeks Looser Terms ------------------------------------------------ Carla Main at Bloomberg News reported that CIT Group Inc. is offering bondholders as little as 25% of the usual rate to loosen the terms on $15.8 billion of debt. The New York-based company run by John Thain, Merrill Lynch & Co.'s former chief executive officer, is willing to pay investors $2.50 per $1,000 face amount of bonds to agree to waive limits on its ability to pay dividends, transfer assets and sell debt. CIT wants to change the terms of the securities to help clear the way for its first sale of unsecured debt since emerging from bankruptcy. The offer suggests that CIT is betting that bondholders expect Mr. Thain to return the company to investment grade. About CIT Group Founded in 1908, CIT Group Inc. (NYSE: CIT) -- http://www.cit.com/ -- is a bank holding company with more than $35 billion in finance and leasing assets. It provides financing and leasing capital to its more than one million small business and middle market clients and their customers across more than 30 industries. CIT Group Inc. and affiliate CIT Group Funding Company of Delaware LLC announced a Chapter 11 filing on Nov. 1, 2009 (Bankr. S.D.N.Y. Case No. 09-16565). Evercore Partners, Morgan Stanley and FTI Consulting served as the Company's financial advisors and Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel in connection with the restructuring plan. Sullivan & Cromwell served as legal advisor to CIT's Board of Directors. CIT emerged from bankruptcy protection on Dec. 11, 2009, after receiving confirmation of its prepackaged Chapter 11 plan of reorganization. * * * In May 2011, Moody's Investors Service upgraded CIT Group Inc.'s Corporate Family Rating to 'B2' from 'B3'. The rating outlook is stable. The upgrade reflects the progress CIT has made addressing its most immediate organizational, operational, and financial challenges subsequent to its bankruptcy reorganization in December 2009. Moody's, however, notes that CIT's weak margins and uncertainty regarding the pace and adequacy of future margin improvements are constraints on the firm's ratings. By repaying and refinancing high-cost debt, CIT has reduced its cost of funds and improved its net finance margin, adjusted to exclude accretion income associated with fresh-start accounting (FSA) and other distortions such as debt prepayment expense. However, CIT's pre- tax margins are well below pre-crisis levels, a function of high funding costs and elevated, though declining credit costs. CLYDESDALE CLO: Moody's Raises Rating on Class D Notes to 'Caa3' ---------------------------------------------------------------- Moody's Investors Service has upgraded the ratings of these notes issued by Clydesdale CLO 2003 Ltd.: -- US$234,000,000 Class A Senior Secured Floating Rate Notes Due 2015 (current outstanding balance of $74,236,255), Upgraded to Aaa (sf); previously on July 21, 2010 Upgraded to Aa1 (sf); -- US$19,000,000 Class B Second Priority Floating Rate Notes Due 2015, Upgraded to A1 (sf); previously on July 21, 2010 Upgraded to Baa3 (sf); -- US$13,000,000 Class C Third Priority Floating Rate Notes Due 2015, Upgraded to Ba1 (sf); previously on July 21, 2010 Upgraded to Caa1 (sf); -- US$10,000,000 Class D Fourth Priority Floating Rate Notes Due 2015, Upgraded to Caa3 (sf); previously on June 17, 2009 Downgraded to C (sf). RATINGS RATIONALE According to Moody's, the rating actions taken on the notes result primarily from the delevering of the Class A Notes, which have been paid down by approximately 44% or $57 million since the rating action in July 2010. As a result of the delevering, the overcollateralization ratios have increased since the rating action in July 2010. As of the latest trustee report dated May 10, 2011, the Class A, Class B, Class C and Class D overcollateralization ratios are reported at 163.4%, 130.1%, 114.2%, and 104.4%, respectively, versus June 2010 levels of 126.6%, 113.0%, 114.2%, and 104.4%, respectively, and all related overcollateralization tests are currently in compliance. Moody's assumes a distribution of approximately $16 million of principal proceeds, reported in the May 2011 trustee report, will be made to the Class A Notes on the next payment date in June. Moody's notes that the Class D Notes are no longer deferring interest and that all previously deferred interest has been paid in full. Moody's also notes that the credit profile of the underlying portfolio has been relatively stable since the last rating action. Based on the May 2011 trustee report, the weighted average rating factor is 2978 compared to 3085 in June 2010, and securities rated Caa1 and below make up approximately 12.1% of the underlying portfolio versus 13.8% in June 2010. The deal also experienced a decrease in defaults. In particular, the dollar amount of defaulted securities has decreased to about $6.6 million from approximately $14 million in June 2010. Due to the impact of revised and updated key assumptions referenced in "Moody's Approach to Rating Collateralized Loan Obligations" and "Annual Sector Review (2009): Global CLOs," key model inputs used by Moody's in its analysis, such as par, weighted average rating factor, diversity score, and weighted average recovery rate, may be different from the trustee's reported numbers. In its base case, Moody's analyzed the underlying collateral pool to have a performing par and principal proceeds balance of $122 million, defaulted par of $6.8 million, a weighted average default probability of 23.97% (implying a WARF of 4191), a weighted average recovery rate upon default of 44.36%, and a diversity score of 44. These default and recovery properties of the collateral pool are incorporated in cash flow model analysis where they are subject to stresses as a function of the target rating of each CLO liability being reviewed. The default probability is derived from the credit quality of the collateral pool and Moody's expectation of the remaining life of the collateral pool. The average recovery rate to be realized on future defaults is based primarily on the seniority of the assets in the collateral pool. In each case, historical and market performance trends and collateral manager latitude for trading the collateral are also factors. Clydesdale CLO 2003 Ltd., issued in September of 2003, is a collateralized loan obligation, backed primarily by a portfolio of senior secured loans. The principal methodology used in this rating was the "Moody's Approach to Rating Collateralized Loan Obligations" published in August 2009. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found on Moody's website. Moody's Investors Service did not receive or take into account a third-party due diligence report on the underlying assets or financial instruments related to the monitoring of this transaction in the past six months. Moody's modeled the transaction using the Binomial Expansion Technique, as described in Section 2.3.2.1 of the "Moody's Approach to Rating Collateralized Loan Obligations" rating methodology published in August 2009. In addition to the base case analysis described above, Moody's also performed sensitivity analyses to test the impact on all rated notes of various default probabilities. Below is a summary of the impact of different default probabilities (expressed in terms of WARF levels) on all rated notes (shown in terms of the number of notches' difference versus the current model output, where a positive difference corresponds to lower expected loss), assuming that all other factors are held equal: Moody's Adjusted WARF -- 20% (3353) Class A: 0 Class B: +2 Class C: +1 Class D: +1 Moody's Adjusted WARF + 20% (5029) Class A: 0 Class B: -2 Class C: -1 Class D: -1 Moody's notes that this transaction is subject to a high level of macroeconomic uncertainty, as evidenced by 1) uncertainties of credit conditions in the general economy and 2) the large concentration of speculative-grade debt maturing between 2012 and 2014 which may create challenges for issuers to refinance. CDO notes' performance may also be impacted by 1) the manager's investment strategy and behavior, and 2) divergence in legal interpretation of CDO documentation by different transactional parties due to embedded ambiguities. Sources of additional performance uncertainties are: 1. Delevering: The main source of uncertainty in this transaction is whether delevering from unscheduled principal proceeds will continue and at what pace. Delevering may accelerate due to high prepayment levels in the loan market and/or collateral sales by the manager, which may have significant impact on the notes' ratings. 2. Recovery of defaulted assets: Market value fluctuations in defaulted assets reported by the trustee and those assumed to be defaulted by Moody's may create volatility in the deal's overcollateralization levels. Further, the timing of recoveries and the manager's decision to work out versus sell defaulted assets create additional uncertainties. 3. Long-dated assets: The presence of assets that mature beyond the CLO's legal maturity date exposes the deal to liquidation risk on those assets. Moody's assumes an asset's terminal value upon liquidation at maturity to be equal to the lower of an assumed liquidation value (depending on the extent to which the asset's maturity lags that of the liabilities) and the asset's current market value. CNS RESPONSE: Incurs $6.9 Million Net Loss in Q2 Ended March 31 --------------------------------------------------------------- CNS Response, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $6.9 million on $191,800 of revenues for the three months ended March 31, 2011, compared with a net loss of $1.4 million on $178,300 of revenues for the three months ended March 31, 2010. For the six months ended March 31, 2011, revenues were $339,600 compared with revenues of $321,800 for the six months ended March 31, 2010. Net loss increased $3.8 million to &7.0 million in the first half ended March 31, 2011, compared to $3.2 million in the first half ended March 31, 2010. The Company's balance sheet at March 31, 2011, showed $1.1 million in total assets, $11.5 million in total liabilities, and a stockholders' deficit of $10.4 million. A copy of the Form 10-Q is available at http://is.gd/KAwGtJ About CNS Response Aliso Viejo, Calif.-based CNS Response, Inc., is a cloud-based neurometric company focused on analysis, research, development and the commercialization of a patented platform which allows psychiatrists and other physicians to exchange outcome data referenced to electrophysiology. With this information, physicians can make more informed decisions when treating individual patients with behavioral (psychiatric and/or addictive) disorders. The Company's secondary Clinical Services business, operated by its wholly-owned subsidiary, Neuro-Therapy Clinic ("NTC"), is a full service psychiatric clinic. Cacciamatta Accountancy Corporation, in Irvine, California, expressed substantial doubt about CNS Response's ability to continue as a going concern, following the Company's results for the fiscal year ended Sept. 30, 2010. The independent auditors noted that of the Company's continued operating losses and limited capital. COMMONWEALTH BANKSHARES: Incurs $6.7-Mil. First Quarter Net Loss ---------------------------------------------------------------- Commonwealth Bankshars, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $6.7 million on $6.3 million of net interest income for the three months ended March 31, 2011, compared with a net loss of $917,341 on $7.3 million of net interest income for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.032 billion in total assets, $1.011 billion in total liabilities, and stockholders' equity of $21.6 million. A copy of the Form 10-Q is available at http://is.gd/QtrhKS Witt Mares, PLC, in Norfolk, Virginia, expressed substantial doubt about Commonwalth Bankshares' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that of the Company's continued operating losses and deterioration of the loan portfolio, undercapitalized status, liquidity restrictions, and other restrictions as a result of regulatory agreements. Norfolk, Va.-based Commonwealth Bankshares, Inc., (Nasdaq:CWBS) -- http://www.bankofthecommonwealth.com/-- is the parent of Bank of the Commonwealth which opened its first office in Norfolk, Virginia, in 1971. Bank of the Commonwealth has 21 bank branches strategically located throughout the Hampton Roads and Eastern North Carolina regions. COMMONWEALTH REIT: S&P Rates $250MM Preferred Shares at 'BB+' ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' rating to $250 million 7.25% series E cumulative redeemable preferred shares issued by CommonWealth REIT (CommonWealth). The company has indicated that it plans to use proceeds from the offering to repay borrowings under its revolving credit facility, which totaled $270 million at March 31, 2011, and general corporate purposes. The new shares will rank pari passu with the company's existing preferred share issues. "In addition to assigning the new rating on the preferred shares, we affirmed our other outstanding ratings on CommonWealth, including the 'BBB' corporate credit rating. Our outlook on the REIT is stable," S&P stated. "Our ratings on CommonWealth reflect the company's satisfactory business risk profile, supported by a large, well-diversified portfolio of office and industrial properties, as well as a lack of development risk," said credit analyst Susan Madison. "Nevertheless, credit metrics have weakened somewhat over the past year reflecting weak office market fundamentals, particularly in CommonWealth's suburban markets." S&P noted, "We expect that CommonWealth's coverage metrics will improve from current levels as the impact of recent well-leased acquisitions bolsters NOI and occupancy levels. Additionally, recent financing initiatives should lower interest expense and other fixed charges. However, if FCC remains at about 2x over the next 18 to 24 months, and prospects for improvement seem limited due to weak property level performance, we could lower the rating to 'BBB-'. We could also lower the rating if CommonWealth's acquisition strategy becomes more focused on properties and investments outside of the U.S-based office and industrial market. We believe upward rating momentum is unlikely at this time, given our expectations for continued pressure on the company's operating metrics in light of still weak real estate fundamentals." COMMUNITY SHORES: Unit Inks $1.07MM Land Sale Deal With Velmeir --------------------------------------------------------------- Community Shores Bank, a wholly-owned subsidiary of Community Shores Bank Corporation, signed a purchase agreement with Velmeir Acquisition Services, LLC, a limited liability company, to sell a vacant land located at the corner of Apple Avenue and Quarterline in the City of Muskegon. The sale is intended to include all buildings, improvements, easements, division rights, hereditaments and appurtenances situated on or associated with the land. Originally the Bank planned on using the land to build a branch. The agreed on sale price is $1,075,000 and is subject to the terms and conditions outlined in the Purchase Agreement, a copy of which is is available for free at http://is.gd/UU4mpC About Community Shores Muskegon, Mich.-based Community Shores Bank Corporation, organized in 1998, is a Michigan corporation and a bank holding company. The Company owns all of the common stock of Community Shores Bank. The Bank was organized and commenced operations in January 1999 as a Michigan chartered bank with depository accounts insured by the FDIC to the extent permitted by law. The Bank provides a full range of commercial and consumer banking services primarily in the communities of Muskegon County and Northern Ottawa County. The Company's balance sheet at March 31, 2011, showed $242.39 million in total assets, $242.25 million in total liabilities, and $141,754 in total shareholders' equity. As reported by the TCR on April 6, 2011, Crowe Horwath LLP, in Grand Rapids, Michigan, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant recurring operating losses, is in default of its note payable collateralized by the stock of its wholly-owned bank subsidiary, and the subsidiary bank is undercapitalized and is not in compliance with revised minimum regulatory capital requirements under a formal regulatory agreement which has imposed limitations on certain operations. The Company reported a net loss of $8.88 million on $6.95 million of net interest income for 2010, compared with a net loss of $4.96 million on $6.79 million of net interest income for 2009. Total non-interest income was $1.57 million for 2010, compared to $1.97 million for 2009. CONSOLIDATION SERVICES: Posts $111,900 Net Loss in 1st Quarter -------------------------------------------------------------- Consolidation Services, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $111,912 on oil and gas revenues of $86,500 for the three months ended March 31, 2011, compared with a net loss of $41,331 on $0 revenue for the same period last year. The Company's balance sheet at March 31, 2011, showed $5.3 million in total assets, $258,702 in total liabilities, and stockholders' equity of $5.0 million. GBH CPAs, PC, in Houston, expressed substantial doubt about Consolidation Services' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company sustained losses from operations for the year ended Dec. 31, 2010, of $13.2 million, has inadequate working capital to maintain or develop its operations, and is dependent upon funds from lenders, investors and the support of certain stockholders. A copy of the Form 10-Q is available at http://is.gd/snrgLR Las Vegas, Nev.-based Consolidation Services, Inc., was incorporated in the State of Delaware on Jan. 26, 2007. The Company is engaged in the exploration and development of oil and gas properties in Kentucky and Tennessee. CYBRDI INC: Posts $118,700 First Quarter Net Loss ------------------------------------------------- Cybrdi Inc. filed its quarterly report on Form 10-Q, reporting a net loss of $188,699 on $113,811 of revenue for the three months ended March 31, 2011, compared with a net loss of $352,244 on $192,444 of revenue for the same period last year. The Company's balance sheet at March 31, 2011, showed $10.2 million in total assets, $5.4 million in total liabilities, and stockholders' equity of $4.8 million. KCCW Accountancy Corp., in Diamond Bar, Calif., expressed substantial doubt about Cybrdi, Inc.'s ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred recurring losses, accumulated deficit, and working capital deficit at Dec. 31, 2010, and 2009. A copy of the Form 10-Q is available at http://is.gd/7wLQJa Cybrdi, Inc., is a holding company incorporated with 80% equity in Chaoying Biotech, which is engaged in biotechnology manufacturing, and research and development. Through Chaoying Biotech, Cybrdi also controls SD Chaoying, a cultural and entertainment company, which is also developing a casino. The Company is headquartered in Xi'an, the capital of Shaanxi province, and a sub-provincial city in the People's Republic of China. DANCING BEAR: WestLB Wins Stay Relief to Continue Foreclosure ------------------------------------------------------------- Bankruptcy Judge Michael E. Romero granted West LB, AG's request for relief from the automatic stay in the three "Dancing Bear" cases. In Dancing Bear Land, LLC's case, West LB's motion for relief from stay alleges the Debtor has no equity in a real property and improvements associated with a luxury fractional interest residence club in Aspen, Colorado, and West LB's debt is now over $60 million. West LB asserts the bankruptcy was filed on the eve of foreclosure in the state court receivership case for the purpose of hindering and delaying West LB. Moreover, West LB alleges Land and DB Capital Holdings, LLC, as part of an out of court workout, waived the automatic stay and waived the right to seek super-priority financing, although they are now seeking the protection of the stay and are seeking super priority financing. West LB asserts Land cannot provide adequate protection, and cannot promulgate a feasible plan to finish the Project. West LB wants the stay lifted so it may continue with its state court proceedings. In the Capital case, West LB asserts Capital owns 100% of Land, an insolvent single asset real property debtor. As part of the loans on the Project, West LB holds a security interest in Capital's equity in Land. West LB contends Capital waived, prepetition, any ability to seek the protection of the stay against West LB. In addition, according to West LB, Capital has no equity in its membership interest in Land, and such membership interest is not necessary to an effective reorganization because the value of the Real Property is much less than West LB's debt, and because Capital has no real prospects for reorganization. With respect to Dancing Bear Development, West LB seeks relief from stay as to Development's equity ownership interest in Capital. West LB asserts Development, prepetition, waived any ability to seek protection of the automatic stay, and has no equity in the collateral, which is not necessary for an effective reorganization. The Debtors objected to West LB's Motions, arguing that relief from stay is not appropriate because the Debtors' prepetition waiver of their rights to claim protection of the automatic stay is unenforceable, because West LB is adequately protected, and because the Real Property is necessary for an effective reorganization the Debtors have in prospect. Aspen HH Ventures, LLC, which is seeking the appointment of a Chapter 11 trustee in Capital's case, contends West LB's Motions should be denied because there has not been a breach of contract by Land or Capital, and because the prepetition waiver is unenforceable. Aspen HH maintains the only way the Project could have incurred cost overruns which exceeded the budget is if West LB breached the parties' loan agreements. Aspen HH asserts West LB did not require evidence prior to each loan advance that the loan proceeds would be sufficient to cover all Project costs. In granting West LB's Motions, Judge Romero held that the Debtors' proposals with respect to reorganization and providing payments to West LB are speculative and do not provide adequate protection for purposes of relief from stay. The Project consists of two phases. Phase I, or the Parkside Building, is the fractional interest residence club located at 411 S. Monarch Street in Aspen. Phase II, or the Mountainside Building, is the partially developed parcel located at 219 E. Durant Avenue in Aspen. Phase I contains a 9-unit condominium building, divided into 72 fractional units, as well as two restricted-income housing units that have been allocated for employees, a restaurant space, underground parking and storage, a meeting space, an exercise facility, and a rooftop deck. Thirty- two of the fractional units in Phase I have been sold, leaving 40 units still available. Phase II was conceived as an 11-unit condominium building to be divided into 80 fractional interests and one penthouse which itself may be divided into 8 fractional interests. Construction on Phase II was halted in mid-2009 and, except for some basic monitoring and maintenance for safety, drainage and snow-loading, the Phase II property has been dormant since construction was halted. To fund the development of the Project, Land, Capital and a subsidiary of Capital, LCH LLC, obtained two loans from West LB: -- a $53,000,000 senior loan in June 2006; and -- a $5,000,000 second loan in September 2006. Land defaulted on the loan in 2009. Judge Romero noted that the Debtors have not proposed a plan or an outline of a plan. They have presented a project analysis indicating the Project cannot be completed without reliance on a super-priority DIP financing arrangement, and the "value engineering" and "rebranding" of the Project. In addition, new contractors and an as-yet unnamed "third party manager" will have to be hired, and the Debtors offered no evidence as to whether they had investigated the availability and timing of hiring such personnel. Even with a proposed DIP financing, the Project's second building will not be completed until May 2013, approximately two years from now. Payments on West LB's secured debt will not begin until six months after that, and the sales of the interval interests will not be completed until August 2016, over six years after the filing of the involuntary petition. According to Judge Romero, the Debtors' proposals are simply too speculative and too attenuated to comprise a reasonable possibility of a successful reorganization within a reasonable time. A copy of Judge Romero's May 25, 2011 decision is available at http://is.gd/hvnUbmfrom Leagle.com. About Dancing Bear DB Capital Holdings, LLC, is a limited liability company organized under the laws of the State of Colorado. Its assets include its membership interest in Dancing Bear Land, LLC, as well as Dancing Bear Realty, LLC, and LCH LLC. Those entities were used to develop and sell a luxury fractional ownership condominium project (made up of two buildings located across the street from each other) in Aspen, Colorado known as the "Dancing Bear Aspen". Dancing Bear Land holds title to the two parcels of real property on which the Project is being constructed. The Debtor has one Class A member, Aspen HH Ventures, LLC, and one Class B member, Dancing Bear Development, LP. The general partner of Dancing Bear Development, LP, is Dancing Bear Management, LLC, which has no membership or other interest in the Debtor, and is solely owned by Tom DiVenere. The Debtor is managed, pursuant to its Operating Agreement, by Dancing Bear Management, LLC. Fred Funk, William Dennis, G.D.B.S. at Snowmass, Inc., Realty Financial Resources, Inc., and O'Bryan Partnership, Inc., filed an involuntary Chapter 11 bankruptcy petition (Bankr. D. Colo. Case No. 10-25805) against DB Capital Holdings on June 24, 2010. The order for relief was entered Nov. 29, 2010. Jeffrey S. Brinen, Esq., represents the petitioners. In its schedules, DB Capital disclosed liabilities of $57,456,046. On Oct. 19, 2010, Dancing Bear Development, LP, filed for Chapter 11 relief (Bankr. D. Colo. Case No. 10-36493) to stay foreclosure of its membership interest in Capital. DB Development estimated assets and debts below $1 million. On Nov. 23, 2010, Dancing Bear Land, LLC, filed for Chapter 11 relief (Bankr. D. Colo. Case No. 10-39584), to stay foreclosure of its Property. In its schedules of assets and liabilities, DB Land disclosed $58 million in liabilities. DANCING BEAR: Court Rejects $5 Million DIP Loan From Colbeck ------------------------------------------------------------ Bankruptcy Judge Michael E. Romero denied the request of Dancing Bear Land, LLC, and DB Capital Holdings, LLC, to obtain up to $5 million in DIP financing agreement from Colbeck Capital Management, LLC, as Administrative Agent. The DIP Facility is secured by all assets of the Debtors including all avoidance actions under the Bankruptcy Code. The proposed financing has an option for a further $35 million credit line if certain projections are met, and gives Colbeck super-priority status. The interest rate is LIBOR plus 13% per annum. The loan matures 12 months from the effective date of a reorganization plan. The Debtors proposed to grant a senior lien on the property, priming the lien of West LB. The Debtors assert West LB will be adequately protected by the anticipated increase in value in the Property, and by monthly adequate protection payments of $100,000. The Debtors intend to finance the development of the Project and repayment of the DIP Facility through the subsequent $35 million priming facility and then repay that facility through the sale of remaining inventory in the Project. The Debtors believe unless they are permitted to borrow the currently proposed $5 million DIP Facility, they will not be able to reorganize. The Debtors also believe without at least approximately $19,173,594 of priming financing and the ability to sell West LB's collateral to fund development expenses they cannot successfully develop the Project. West LB objected, alleging that the Debtors have no free and clear assets with which to offer adequate protection, and have no equity cushion in any of their assets which could be used for the same purpose. West LB asserts the proposed adequate protection does not compensate it nor provide adequate protection in the face of the proposed $5 million super-priority loan, because the Debtors are relying totally on speculative increases in value. Further, West LB contends the initial $5 million will be used solely to pay administrative expenses, not to finish the Project, so it will not increase the Real Property's value. According to West LB, the Debtors cannot demonstrate cause to allow the super-priority borrowing, as the Debtors are so far "under water" with the Project, and the proposed loan is so risky, no benefit would be realized by the estate. West LB argues Colbeck has not made a firm commitment actually to fund the $5 million (or the later amount) even if the financing agreement were approved, and is charging what amounts to an excessive 21% interest rate. In addition, West LB objects to the Debtors' proposal to divert all sales proceeds, which are West LB's collateral, to Colbeck. West LB believes there has been no showing a priming loan is justified because there is very little chance the Project can succeed as the Debtors claim. Aspen HH Ventures, LLC, also objected, arguing that Thomas M. Di Venere, the manager of Land is Thomas M. Di Venere ("Di Venere"), and the present manager of Dancing Bear Land, LLC, has no authority to act in the absence of consent by Aspen HH. It contends the funding would only benefit Mr. Di Venere, and would increase the $63 million debt on the Real Property by potentially $35 million. According to Aspen HH, since the initial $5 million would be used to pay administrative expenses, it would have no benefit to the estate. Moreover, Aspen HH argues Mr. Di Venere's estimation the completed Project might be worth $100 million is entirely unrealistic and speculative, and placing nearly $100 million of debt on the Real Property makes no economic sense. In denying the Debtors' request to borrow, Judge Romero said the Debtors have not met the requirements of 11 U.S.C. Section 364(d)(1)(B). Judge Romero pointed out that, although periodic payments are proposed, the payments do not come from any assets owned by the Debtors, but merely from the super-priority financing itself. Any failure by the Debtors to meet the requirements of Colbeck to obtain some or all of the financing, or any failure by the Debtors to finish the Project and sell the fractional interests as they anticipate, will endanger payments to West LB, and result in West LB losing value in its secured interest because Colbeck will receive payment in full before any payment on West LB's debt. Therefore, the payments are speculative and risky and do not offer adequate protection. According to Judge Romero, the Debtors have not offered, and, due to lack of equity and lack of unencumbered assets, cannot offer, additional or replacement liens. The proposals to pay the debt of West LB beginning over two years from now, in October 2013, with final payment to be made in 2015, do not offer the indubitable equivalent of West LB's current lien interest. Rather, under the proposal, West LB must wait years for repayment, at a time when no plan of reorganization has been proposed, and on a basis which is speculative and vague. About Dancing Bear DB Capital Holdings, LLC, is a limited liability company organized under the laws of the State of Colorado. Its assets include its membership interest in Dancing Bear Land, LLC, as well as Dancing Bear Realty, LLC, and LCH LLC. Those entities were used to develop and sell a luxury fractional ownership condominium project (made up of two buildings located across the street from each other) in Aspen, Colorado known as the "Dancing Bear Aspen". Dancing Bear Land holds title to the two parcels of real property on which the Project is being constructed. The Debtor has one Class A member, Aspen HH Ventures, LLC, and one Class B member, Dancing Bear Development, LP. The general partner of Dancing Bear Development, LP, is Dancing Bear Management, LLC, which has no membership or other interest in the Debtor, and is solely owned by Tom DiVenere. The Debtor is managed, pursuant to its Operating Agreement, by Dancing Bear Management, LLC. Fred Funk, William Dennis, G.D.B.S. at Snowmass, Inc., Realty Financial Resources, Inc., and O'Bryan Partnership, Inc., filed an involuntary Chapter 11 bankruptcy petition (Bankr. D. Colo. Case No. 10-25805) against DB Capital Holdings on June 24, 2010. The order for relief was entered Nov. 29, 2010. Jeffrey S. Brinen, Esq., represents the petitioners. In its schedules, DB Capital disclosed liabilities of $57,456,046. On Oct. 19, 2010, Dancing Bear Development, LP, filed for Chapter 11 relief (Bankr. D. Colo. Case No. 10-36493) to stay foreclosure of its membership interest in Capital. DB Development estimated assets and debts below $1 million. On Nov. 23, 2010, Dancing Bear Land, LLC, filed for Chapter 11 relief (Bankr. D. Colo. Case No. 10-39584), to stay foreclosure of its Property. In its schedules of assets and liabilities, DB Land disclosed $58 million in liabilities. DANCING BEAR: Ch. 11 Trustee Moot in View of WestLB Stay Relief --------------------------------------------------------------- Bankruptcy Judge Michael E. Romero denied the request of Aspen HH Ventures, LLC, for the appointment of a Chapter 11 trustee in the bankruptcy case of DB Capital Holdings, LLC. The Troubled Company Reporter published a story on Aspen HH's request in its April 25, 2011 edition. DB Capital has objected to the request, contending that Aspen HH has not shown the Debtor is deadlocked or has engaged in gross mismanagement. Capital denies any fraudulent conduct or mismanagement that would warrant appointment of a trustee, and asserts a trustee would simply create administrative expenses and would not benefit the estates or the creditors. Secured lender West LB contends that the presence or absence of a trustee has no bearing on the fact West LB is entitled, in its own estimation, to relief from stay as to the assets of all three Dancing Bear debtors, and a trustee should not impair West LB's ability to pursue its lien rights. According to Judge Romero, since he has granted West LB's motions for relief from stay and denied the Dancing Bear Debtors' motion to obtain DIP financing, any ruling on a Chapter 11 Trustee would be moot. Assuming West LB pursues its state court remedies as to the Debtors' real property, the judge said the Debtors may have few or no remaining assets for administration by a Chapter 11 Trustee. Today's edition of the Troubled Company Reporter includes stories on the Court's rulings (i) granting West LB relief from stay and (ii) denying the Debtors' DIP financing motion. About Dancing Bear DB Capital Holdings, LLC, is a limited liability company organized under the laws of the State of Colorado. Its assets include its membership interest in Dancing Bear Land, LLC, as well as Dancing Bear Realty, LLC, and LCH LLC. Those entities were used to develop and sell a luxury fractional ownership condominium project (made up of two buildings located across the street from each other) in Aspen, Colorado known as the "Dancing Bear Aspen". Dancing Bear Land holds title to the two parcels of real property on which the Project is being constructed. The Debtor has one Class A member, Aspen HH Ventures, LLC, and one Class B member, Dancing Bear Development, LP. The general partner of Dancing Bear Development, LP, is Dancing Bear Management, LLC, which has no membership or other interest in the Debtor, and is solely owned by Tom DiVenere. The Debtor is managed, pursuant to its Operating Agreement, by Dancing Bear Management, LLC. Fred Funk, William Dennis, G.D.B.S. at Snowmass, Inc., Realty Financial Resources, Inc., and O'Bryan Partnership, Inc., filed an involuntary Chapter 11 bankruptcy petition (Bankr. D. Colo. Case No. 10-25805) against DB Capital Holdings on June 24, 2010. The order for relief was entered Nov. 29, 2010. Jeffrey S. Brinen, Esq., represents the petitioners. In its schedules, DB Capital disclosed liabilities of $57,456,046. On Oct. 19, 2010, Dancing Bear Development, LP, filed for Chapter 11 relief (Bankr. D. Colo. Case No. 10-36493) to stay foreclosure of its membership interest in Capital. DB Development estimated assets and debts below $1 million. On Nov. 23, 2010, Dancing Bear Land, LLC, filed for Chapter 11 relief (Bankr. D. Colo. Case No. 10-39584), to stay foreclosure of its Property. In its schedules of assets and liabilities, DB Land disclosed $58 million in liabilities. D.D.S. GROUP: Case Summary & 10 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: D.D.S. Group, LLC 2512 Rancho Bel Air Drive Las Vegas, NV 89107 Bankruptcy Case No.: 11-18284 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: David A. Riggi, Esq. DAVID A. RIGGI, ATTORNEY AND COUNSELOR AT LAW 5550 Painted Mirage Road, #120 Las Vegas, NV 89149 Tel: (702) 808-0359 E-mail: darnvbk@gmail.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 10 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nvb11-18284.pdf The petition was signed by Daniel Kelsay, Jr., managing member. DEMMIE ACOSTA: Court Defers Payment of Half of Brokers' Fees ------------------------------------------------------------ Demmie B. Acosta, Marcus & Millichap Real Estate Investment Services, Inc., Mark A. Mason and John M. Antonini asked the Court to allow payment in full of real estate commissions in connection with the Debtor's sales of real property on 17th Street and 18th Street in San Francisco even though the Court-authorized broker, Marcus & Millichap, did not comply with the Court's order prohibiting it from representing both the seller -- Debtor -- and any buyer of the Properties. In his May 24, 2011 Memorandum Decision, Bankruptcy Judge Dennis Montali allowed payment of one-half of the commissions due on the sales of each of the Properties, and subordinate the other half until creditors of these affiliated debtors have been paid in full. A copy of Judge Montali's ruling is available at http://is.gd/6tFTi4from Leagle.com. Demie Balauro Acosta filed a Pro Se Chapter 11 petition (Bankr. N.D. Calif. Case No. 09-32339) on Aug. 14, 2009. The case is jointly administered with the Pro Se Chapter 11 case of Beriong Investments LLC (Bankr. N.D. Calif. Case No. 09-32340). DENNIS J. FULLENKAMP: Case Summary & 2 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Dennis J. Fullenkamp Realty, Inc. 3443 Hancock Bridge Parkway, Suite 301 North Fort Myers, FL 33903 Bankruptcy Case No.: 11-10310 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court Middle District of Florida (Ft. Myers) Debtor's Counsel: Christopher C. Nash, Esq. LEAVENGOOD, NASH, DAUVAL & BOYLE PA 2958 1st Avenue North St. Petersburg, FL 33713 Tel: (727) 347-7828 Fax: (727) 327-3305 E-mail: data@leavenlaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's two largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb11-10310.pdf The petition was signed by Dennis J. Fullenkamp, president. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Dennis J. Fullenkamp 11-10302 05/27/11 DIAMONDHEAD CASINO: Incurs $552,100 Net Loss in 1st Quarter ----------------------------------------------------------- Diamondhead Casino Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $552,141 for the three months ended March 31, 2011, compared with a net loss of $548,734 for the same period last year. The Company incurs ongoing expenses, but has no current revenue and no revenue stream with which to pay ongoing expenses. The Company's balance sheet at March 31, 2011, showed $5.7 million in total assets, $2.5 million in total liabilities, and stockholders' equity of $3.2 million. As reported in the TCR on March 29, 2011, Friedman LLP, in New York, N.Y., expressed substantial doubt about Diamondhead Casino's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred significant recurring net losses over the past few years, and in addition, has no operations, except for its efforts to develop the Diamondhead, Mississippi property. A copy of the Form 10-Q is available at http://is.gd/Lyx27E Largo, Fla.-based Diamondhead Casino Corporation, from inception through approximately August of 2000, operated gaming vessels in international waters. The Company eventually divested itself of its gaming operations to satisfy financial obligations to its vendors, lenders and taxing authorities and to focus its resources on the development of a casino resort in Diamondhead, Mississippi. The Company owns, through its wholly-owned subsidiary, Mississippi Gaming Corporation, an approximate 404.5 acre tract of unimproved land in Diamondhead, Mississippi. The property is located at 7051 Interstate 10. The Company intends, in conjunction with unrelated third parties, to develop the site in phases beginning with a casino resort. The casino resort is expected to include a casino, a hotel and spa, pools, a sport and entertainment center, a conference center and a state-of-the-art recreational vehicle park. The Company has no current operations in Mississippi. DLGC II: U.S. Trustee Unable to Form Committee ---------------------------------------------- The United States Trustee said that a committee under 11 U.S.C. Sec. 1102 has not been appointed because an insufficient number of persons holding unsecured claims against DLGC II have expressed interest in serving on a committee. The U.S. Trustee reserves the right to appoint such a committee should interest develop among the creditors. Phoenix, Arizona-based DLGC II, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 11-10174) on April 13, 2011. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. Affiliate Lake Pleasant Group, LLP (Bankr. D. Ariz. Case No. 11- 10170) filed a separate Chapter 11 petition on April 13, 2011. DONALD HARTMANN: Court Trims Sally Frederick Lawsuit ---------------------------------------------------- Bankruptcy Judge Michael E. Romero granted, in part, and denied, in part, Donald Leonhard Hartmann's request to dismiss the complaint, SALLY D. FREDERICK, v. DONALD LEONHARD HARTMANN, Adv. Proc. No. 10-1919 (D. Colo.). Mr. Hartmann's Motion to Dismiss is granted to the extent it seeks dismissal of Ms. Frederick's second claim for relief under 11 U.S.C. Sec. 523(a)(19), and to the extent it seeks dismissal of the embezzlement components of her first claim for relief under Sec. 523(a)(4). It is denied to the extent it seeks dismissal of the fraud or defalcation and larceny components of Ms. Frederick's first claim for relief under Sec. 523(a)(4), to the extent it seeks dismissal of her third claim for relief under Sec. 523(a)(2)(A), and to the extent it seeks dismissal of Ms. Frederick's fourth claim for relief under Sec. 523(a)(6). Ms. Frederick is directed to file an amended complaint properly asserting the larceny claim under Sec. 523(a)(4) and the willful and malicious injury elements of her claim under Sec. 523(a)(6) or those claims will be dismissed. A copy of Judge Romero's May 25, 2011 Order is available at http://is.gd/qmwrTEfrom Leagle.com. Donald Leonhard Hartmann is a Chapter 11 Debtor (Bankr. D. Colo. Case No. 10-31429). DRYSHIPS INC: Ocean Rig Adopts Shareholder Rights Plan ------------------------------------------------------ Ocean Rig UDW Inc., DryShips, Inc.'s majority-owned subsidiary, has adopted a shareholder rights plan, pursuant to which shareholders will receive one right per share of common stock held to purchase a fraction of a share of Series A Participating Preferred Stock. The right separates from the common stock and become exercisable after a person or group, other than DryShips, acquires beneficial ownership of 15% or more of Ocean Rig UDW's common stock or the 10th business day after a person or group, other than DryShips, announces a tender or exchange offer which would result in that person or group holding 15% or more of the Ocean Rig UDW's common stock. In such event, each holder of a right (except the acquiring person) is entitled to buy at the exercise price of $100, a number of shares of the Ocean Rig UDW's common stock which has a market value of twice the exercise price. Any time after the date an acquiring person obtains more than 15% of Ocean Rig UDW's common stock and before that acquiring person acquires more than 50% of Ocean Rig UDW's outstanding common stock, the Ocean Rig UDW is permitted to exchange each right owned by all other rights holders, in whole or in part, for one share of common stock. The rights may have anti-takeover effects. The rights will cause substantial dilution to any person or group that attempts to acquire Ocean Rig UDW without the approval of the Ocean Rig UDW's board of directors. Ocean Rig UDW may redeem the rights at any time prior to a public announcement that a person has acquired beneficial ownership of 15% or more of Ocean Rig UDW's common stock. 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 Sept. 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 March 31, 2011, showed US$6.99 billion in total assets, US$3.05 billion in total liabilities, and US$3.94 billion in total equity. In its audit report on the Company's financial statements for the year ended Dec. 31, 2010, Deloitte, Hadjipavlou Sofianos & Cambanis S.A., noted that the Company's inability to comply with financial covenants under its original loan agreements as of Dec. 31, 2009, its negative working capital position and other matters raise substantial doubt about its ability to continue as a going concern. DUKE & KING: U.S. Trustee Asks for Conversion or Dismissal ---------------------------------------------------------- Chapter11Cases.com reports that the United States Trustee for Region 12 is asking the Minnesota bankruptcy court to either dismiss or convert to chapter 7 the bankruptcy cases of Duke and King Acquisition Corp. and four affiliated companies. According to Chapter11Cases.com, the companies have received authority to sell the franchises from the bankruptcy court and the U.S. Trustee's motion states that "at the time this motion is heard, the Debtors will have closed on the sale of the restaurants and will have no further business operations, but instead will be left with relatively little furniture, fixtures and equipment to liquidate." Although it asked for a conversion or dismissal, the U.S. Trustee states that its preference is for the bankruptcy cases to be converted, Chapter11Cases.com notes. According to the report, the motion asserts two separate grounds for conversion: (1) Insiders are selling the remaining non-operating assets to a related company for less than fair market value and with no evidence that any efforts were make to have an arms length sale, and the Debtors expect to continue with future transactions with the insiders' related entity. The transactions require "an immediate review and an independent trustee to determine what is in the estates' best interests." (2) Once the sale of the franchises closes, the chapter 11 cases will be "for all meaningful purposes over." About Duke and King Burnsville, Minnesota-based Duke and King Acquisition Corp., dba Burger King, operates 92 Burger King franchises in Minnesota, Missouri, Illinois, Wisconsin, Iowa and Kansas. The Company was formed in November 2006 to acquire 88 Burger King franchise restaurants from The Nath Companies. The Company and four affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Minn. Case No. 10-38652) on December 4, 2010. Clinton E. Cutler, Esq., and Douglas W. Kassebaum, Esq., at Fredrikson & Byron, P.A., serve as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Affiliates Duke and King Missouri Holdings, Inc. (Bankr. D. Minn. Case No. 10-38654), Duke and King Missouri, LLC (Bankr. D. Minn. Case No. 10-38653), Duke and King Real Estate, LLC (Bankr. D. Minn. Case No. 10-38655), and DK Florida Holdings, Inc. (Bankr. D. Minn. Case No. 10-3856), filed separate Chapter 11 petitions on December 4, 2010. The cases are jointly administered under the Duke and King Acquisition Corp. case. According to NetDockets, the companies' primary secured financing is provided by Bank of America and the outstanding obligations were approximately $11 million as of December 1, 2010. DUTCH GOLD: Restated 2009 Annual Report Hikes Net Loss by $0.9MM ---------------------------------------------------------------- Dutch Gold Resources, Inc., filed with the U.S. Securities and Exchange Commission an amended Annual Report on Form 10-K/A for the year ended Dec. 31, 2009. The Company's restated statement of operations reflects a net loss of $11.33 million on $0 of sales for the year ended Dec. 31, 2009, compared with a net loss of $10.41 million on $0 of sales as originally reported. The Company's restated balance sheet at Dec. 31, 2009, showed $1.24 million in total assets, $8.05 million in total liabilities and a $6.81 million total stockholders' deficit, compared with $1.24 million in total assets, $5.53 million in total liabilities and a $4.29 million total stockholders' deficit. A full-text copy of the Amended Form 10-K is available at no charge at http://is.gd/PNDmpP About Dutch Gold Based in Atlanta, Ga., Dutch Gold Resources, Inc. (OTC: DGRI) -- http://www.dutchgoldresources.com/-- is a junior gold miner focused on developing its existing mining properties in North America and acquiring and developing new mines that can enter into production in 12 to 24 months. The Company reported a net loss of $3.70 million on $0 of revenue for the year ended Dec. 31, 2010, compared with a net loss of $11.33 million on $0 of revenue during the prior year. The Company reported a net loss of $1.18 million on $0 of revenue for the three months ended March 31, 2011, compared with a net loss of $987,438 on $0 of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $4.22 million in total assets, $6.87 million in total liabilities, and a $2.65 million total stockholders' deficit. As reported, Hancock Askew & Co., LLP, in Atlanta, Georgia, expressed substantial doubt about the Company's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has limited liquidity and has incurred recurring losses from operations. DYNAMO LLC: Court Rejects Former Lawyers' Bid to Reopen Case ------------------------------------------------------------ Dynamo, LLC's former attorneys, as unpaid administrative creditors, filed a motion to reopen the chapter 11 case and to have the order of dismissal vacated because of an alleged fraud on the Court. In a May 24, 2011 Opinion, Bankruptcy Judge Raymond T. Lyons held that the former owner of the Debtor, Diane Cosola, did not mislead the Court when her attorney advocated dismissal, rather than conversion to Chapter 7. She intended, as her attorney represented, to retake control of the limited liability company and operate the business as a going concern. Her determination to sell the assets of the Debtor to a newly formed entity controlled by her brother was not made prior to her representations to the Court at the time of the hearing. There was no fraud. The motions to reopen and to vacate the order of dismissal are denied. A copy of the Court's ruling is available at http://is.gd/1pgLHefrom Leagle.com. The former lawyers are represented by: David E. Shaver, Esq. BROEGE, NEUMANN, FISHER & SHAVER LLC 25 Abe Voorhees Drive Manasquan, NJ 08736 Tel: 732-722-5763 877-571-5074 Fax: 732-223-2416 Diane Cosola is represented by: Chryssa Yaccarino, Esq. KELLY & BRENNAN, P.C. Coast Capital Building, Suite 200 1011 Highway 71 Spring Lake, NJ 07762 Tel: (732) 449-0525 Fax: (732) 449-0592 Dynamo, LLC, filed a voluntary Chapter 11 petition (Bankr. D. N.J. Case No. 08-27675) on Sept. 16, 2008. Luciano Castiglione was listed as the sole equity security holder. The Debtor operated a pizzeria restaurant. EAU TECHNOLOGIES: Karl Hellman Resigns as Director -------------------------------------------------- Karl Hellman, a director of EAU Technologies, Inc., informed the Company that he is resigning as a director effective immediately. EAU did not have any disagreement with Mr. Hellman. The Company expressed its appreciation to Mr. Hellman for his many years of service on the board. About EAU Technologies Kennesaw, Ga.-base EAU Technologies, Inc., is in the business of developing, manufacturing and marketing equipment that uses water electrolysis to create non-toxic cleaning and disinfecting fluids for food safety applications as well as dairy drinking water. As reported by the TCR on April 7, 2011, HJ & Associates, LLC, in Salt Lake City, Utah, expressed substantial doubt about EAU Technologies' ability to continue as a going concern following the Company's 2010 results. The independent auditors noted that the Company has a working capital deficit as well as a deficit in stockholders equity. The Company reported net income of $2.4 million on $697,555 of revenues for 2010, compared with a net loss of $2.2 million on $724,510 of revenues for 2009. EDRA BLIXSETH: Lender Set to Buy Yellowstone 'Family Compound' -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the so-called Family Compound at the Yellowstone Mountain Club LLC failed to attract any bid to compete with the $10.9 million offer from the secured lender. Consequently, the May 20 auction was canceled, court filings say. The sale was being undertaken by the bankruptcy trustee for Edra Blixseth, who took over management of the bankrupt club development when her husband Timothy gave her the property in August 2008 as part of a divorce settlement. Situated on 160 acres, the home has two 2,240 square-foot residences. Membership in the club wasn't included in the purchase price. About Edra D. Blixseth Edra D. Blixseth owns the Porcupine Creek Golf Club in Rancho Mirage and the Yellowstone Club in Montana. Ms. Blixseth filed for Chapter 11 bankruptcy protection on March 26, 2009 (Bankr. D. Mont. Case No. 09-60452). Gary S. Deschenes, Esq., at Deschenes & Sullivan Law Offices assists Ms. Blixseth in her restructuring efforts. The Debtor estimated $100 million to $500 million in assets and $500 million to $1 billion in debts. The Debtor's case was converted from a Chapter 11 to a Chapter 7 by Court order entered May 29, 2009. About Timothy Blixseth Tax officials from California, Montana and Idaho on April 5, 2011, filed an involuntary-bankruptcy petition under Chapter 7 against Timothy Blixseth in Las Vegas, Nevada (Bankr. D. Nev. Case No. 11-15010). The three states that signed the petition against the Yellowstone Club co-founder claim they are owed $2.3 million in back taxes. A copy of the petition is available for free at http://bankrupt.com/misc/nvb11-15010.pdf Mr. Blixseth is seeking dismissal of the involuntary petition. Mr. Blixseth and his former wife, Edra Blixseth, founded the Yellowstone Club, near Big Sky, Montana, in 2000 as a ski resort for millionaires looking for vacation homes. Members paid $205 million for 72 properties in 2005 alone. Bloomberg News, citing a court ruling by U.S. Bankruptcy Judge Ralph B. Kirscher, says the couple took cash for their personal use from a $375 million loan arranged by Credit Suisse. Finances at the club deteriorated thereafter, and the club eventually went bankrupt, Judge Kirscher found. Mr. Blixseth was ordered to pay $40 million to the club's creditors under a September ruling by Judge Kirscher. Mr. Blixseth said he's appealing that judgment. About Yellowstone Mountain Located near Big Sky, Montana, Yellowstone Mountain Club LLC -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Club and its affiliates filed for Chapter 11 bankruptcy on Nov. 10, 2008 (Bankr. D. Montana, Case No. 08- 61570). The Company's owner affiliate, Edra D. Blixseth, filed for Chapter 11 on March 27, 2009 (Case No. 09-60452). In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners, LLC, acquired equity ownership in the reorganized Club for $115 million. Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC represented the Debtors. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer, as counsel, and James H. Cossitt, Esq., at local counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. ELITE PHARMACEUTICALS: Has 243.36MM Outstanding Common Shares ------------------------------------------------------------- Elite Pharmaceuticals, Inc., announced that all of the outstanding shares of its Series D 8% Convertible Preferred Stock has been converted into the Company's common stock, pursuant to the election of the holders of the Series D. This eliminates the Company's obligation to pay $720,000 in annual dividends and eliminates the associated administrative costs. The Company now has 243,363,531 shares of common stock outstanding. About Elite Pharmaceuticals Northvale, N.J.-based Elite Pharmaceuticals, Inc. (OTC BB: ELTP) -- http://www.elitepharma.com/-- is a pharmaceutical firm that develops and manufactures oral, controlled-release products using proprietary technology. Elite developed and manufactures for its partner, ECR Pharmaceuticals, Lodrane 24(R) and Lodrane 24D(R), for allergy treatment and expects to launch soon three approved generic products. Elite also has a pipeline of additional generic drug candidates under active development and the Company is developing ELI-216, an abuse resistant oxycodone product, and ELI- 154, a once-a-day oxycodone product. Elite conducts research, development and manufacturing in its facility in Northvale, New Jersey. The Company's balance sheet at Dec. 31, 2010, showed $10.89 million in total assets, $17.46 million in total liabilities, and $6.57 million in total stockholders' deficit. Demetrius & Company, L.L.C., in Wayne, New Jersey, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's results for fiscal year ended March 31, 2010. The independent auditors noted that the Company has experienced significant losses and negative operating cash flows resulting in a working capital deficiency and shareholders' deficit. The Company reported a net loss $8.1 million on $3.3 million of revenue for the fiscal year ended March 31, 2010, compared with a net loss of $6.6 million on $2.3 million of revenue for the year ended March 31, 2009. ELITE PHARMACEUTICALS: Wistar Morris Discloses 4.39% Equity Stake ----------------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission, I. Wistar Morris, III, disclosed that he beneficially owns 10,672,439 shares of common stock of Elite Pharmaceuticals, Inc., representing 4.39% of the shares outstanding, based on the Company's 243,363,531 outstanding shares as of May 24, 2011. A full-text copy of the filing is available for free at: http://is.gd/gHLjSH About Elite Pharmaceuticals Northvale, N.J.-based Elite Pharmaceuticals, Inc. (OTC BB: ELTP) -- http://www.elitepharma.com/-- is a pharmaceutical firm that develops and manufactures oral, controlled-release products using proprietary technology. Elite developed and manufactures for its partner, ECR Pharmaceuticals, Lodrane 24(R) and Lodrane 24D(R), for allergy treatment and expects to launch soon three approved generic products. Elite also has a pipeline of additional generic drug candidates under active development and the Company is developing ELI-216, an abuse resistant oxycodone product, and ELI- 154, a once-a-day oxycodone product. Elite conducts research, development and manufacturing in its facility in Northvale, New Jersey. The Company's balance sheet at Dec. 31, 2010, showed $10.89 million in total assets, $17.46 million in total liabilities, and $6.57 million in total stockholders' deficit. Demetrius & Company, L.L.C., in Wayne, New Jersey, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's results for fiscal year ended March 31, 2010. The independent auditors noted that the Company has experienced significant losses and negative operating cash flows resulting in a working capital deficiency and shareholders' deficit. The Company reported a net loss $8.1 million on $3.3 million of revenue for the fiscal year ended March 31, 2010, compared with a net loss of $6.6 million on $2.3 million of revenue for the year ended March 31, 2009. ENTREMED, INC: Incurs $2.6 Million First Quarter Net Loss --------------------------------------------------------- EntreMed, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $2.6 million for the three months ended March 31, 2011, compared with a net loss of $2.1 million for the same period last year. There were no revenues recorded during the quarters ended March 31, 2011, or March 31, 2010. The Company does not expect to record revenue in 2011 until the fourth quarter. The Company's balance sheet at March 31, 2011, showed $5.1 million in total assets, $1.7 million in total liabilities, and stockholders' equity of $3.4 million. As reported in the TCR on April 6, 2011, Reznick Group, P.C., in Vienna, Va., expressed substantial doubt about EntreMed's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred recurring operating losses and negative cash flows from operations. A copy of the Form 10-Q is available at http://is.gd/9sUx3c Rockville, Md.-based EntreMed, Inc. (Nasdaq: ENMD) -- http://www.entremed.com/-- is a clinical-stage pharmaceutical company focused on developing its lead compound ENMD-2076, an Aurora A and angiogenic kinase inhibitor for the treatment of cancer. ENMD-2076 has completed Phase 1 studies in patients with advanced solid tumors and leukemia and is currently in a Phase 1 study in multiple myeloma and a multi-center Phase 2 study in patients with platinum resistant ovarian cancer. ESCALON MEDICAL: Incurs $1.9 Million Net Loss in Q3 Ended March 31 ------------------------------------------------------------------ Escalon Medical Corp. filed its quarterly report on Form 10-Q, reporting a net loss of $1.9 million on $7.5 million of revenues for the three months ended March 31, 2011, compared with a net loss of $309,358 on $7.9 million of revenues for the same period of the prior fiscal year. The Company reported a net loss of $3.6 million on $22.6 million of revenues for the nine months ended March 31, 2011, compared with a net loss of $2.0 million on $23.6 million of revenues for the same period of the prior fiscal year. The Company's balance sheet as of March 31, 2011, showed $19.0 million in total assets, $10.5 million in total liabilities, and stockholders' equity of $8.5 million. As reported in the Troubled Company Reporter on October 15, 2010, Mayer Hoffman McCann P.C., in Plymouth Meeting, Pa., expressed substantial doubt about Escalon Medical'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 ongoing debt payments on the debt related to the Biocode Hycel acquisition and continued losses from operations and negative cash flows from operating activities. A copy of the Form 10-Q is available at http://is.gd/yvxawz About Escalon Medical Wayne, Pa.-based Escalon Medical Corp. (Nasdaq: ESMC) -- http://www.escalonmed.com/-- operates in the healthcare market specializing in the development, manufacture, marketing and distribution of medical devices and pharmaceuticals in the areas of ophthalmology, diabetes, hematology and vascular access. EVANS OIL: Can Use Fifth Third's Cash Collateral Until June 3 ------------------------------------------------------------- The Hon. David H. Adams of the U.S. Bankruptcy Court for the Middle District of Florida authorized, on an interim basis, The Evans Oil Company LLC, et al., to use the cash collateral until June 3, 2011. As reported in the Troubled Company Reporter on Feb. 9, Fifth Third Bank, Evans' principal working capital and secured lender, asserts a security interest in Debtors' cash collateral. Fifth Third Bank provides various credit facilities to Evans Oil, pursuant to a certain Amended and Restated Credit Agreement entered into as of April 16, 2010. Presently, Evans Oil owes Fifth Third Bank approximately $34 million. John S. Sarrett, Esq., at Hahn Loeser & Parks LLP, explained that the Debtors need the money to fund their Chapter 11 case, pay suppliers and other parties. As adequate protection for any such interest in cash collateral used by the Debtors, Fifth Third is granted replacement liens upon, and security interests in, Debtors' postpetition cash collateral, but only to the extent that Debtors diminish the cash collateral. As further adequate protection of Fifth Third's interests in the cash collateral, the Debtors will provide counsel for Fifth Third and any creditors' committee with weekly and daily financial reports. Fifth Third may, upon not less than two business days' prior written notice to Debtors' counsel, have the right to a hearing on stay relief. The Court scheduled a May 26 hearing to consider the Debtors' further access to the cash collateral. About Evans Oil Naples, Florida-based Evans Oil Company LLC, aka Evans Oil Co LLC, distributes bulk oil, gas, diesel and lubricant products. Evans Oil, together with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Lead Case No. 11-01515) on Jan. 30, 2011. Attorneys at Hahn Loeser & Parks LLP as bankruptcy counsel serve as bankruptcy counsel to the Debtors. Garden City Group Inc. is the claims and notice agent. The Parkland Group Inc. is the restructuring advisor. Evans Oil estimated assets and debts at $10 million to $50 million as of the Chapter 11 filing. EVANS OIL: Selling Marine Fuel Supply Equipment to Florida Marina ----------------------------------------------------------------- The Hon. David H. Adams of the U.S. Bankruptcy Court for the Middle District of Florida authorized Evans Oil Company LLC, et al., to sell various marine fuel supply equipment to Florida Marina Clubs, LLC for $75,000. The sale is on an as-is, where-is basis and is free and clear of all interests. About Evans Oil Naples, Florida-based Evans Oil Company LLC, aka Evans Oil Co LLC, distributes bulk oil, gas, diesel and lubricant products. Evans Oil, together with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Lead Case No. 11-01515) on Jan. 30, 2011. Attorneys at Hahn Loeser & Parks LLP as bankruptcy counsel serve as bankruptcy counsel to the Debtors. Garden City Group Inc. is the claims and notice agent. The Parkland Group Inc. is the restructuring advisor. Evans Oil estimated assets and debts at $10 million to $50 million as of the Chapter 11 filing. EVANS OIL: Fifth Third Wants to Commence Foreclosure on Property ---------------------------------------------------------------- Fifth Third Bank asks the U.S. Bankruptcy Court for the Middle District of Florida to modify the automatic stay imposed, or, in the alternative, to require Evans Oil Company, LLC, et al., to provide Fifth Third with adequate protection. Fifth Third also asks the Court for authority to commence and conclude foreclosure proceedings on Wet Slip 20, Naples Boat Club Wet Slip Marina. Fifth Third explains that it lacks adequate protection because the Debtor has not made any postpetition payments to Fifth Third under the note. Further, interest continues to accrue under the note and is unpaid. Fifth Third is owed $939,030 pursuant to a term loan promissory note with the effective date of April 16, 2010. Based on the Nov. 10, 2010, appraisal, the property has an appraised value of $425,000. About Evans Oil Naples, Florida-based Evans Oil Company LLC, aka Evans Oil Co LLC, distributes bulk oil, gas, diesel and lubricant products. Evans Oil, together with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Lead Case No. 11-01515) on Jan. 30, 2011. Attorneys at Hahn Loeser & Parks LLP as bankruptcy counsel serve as bankruptcy counsel to the Debtors. Garden City Group Inc. is the claims and notice agent. The Parkland Group Inc. is the restructuring advisor. Evans Oil estimated assets and debts at $10 million to $50 million as of the Chapter 11 filing. EVERGREEN TRANSPORTATION: Trustee Seeks to Appoint Attorney ----------------------------------------------------------- Lynn H. Andrews, Esq. as Chapter 11 Trustee of Evergreen Transportation, Inc., seeks authority from the Southern District of Alabama to employ Terrie S. Owen, Attorney at Law, to represent her in the Chapter 11 case. Alabama-based Evergreen Transportation, Inc., operates a freight and logistics business. The Company filed for Chapter 11 (Bankr. S.D. Ala. Case No. 09-13525) on Aug. 4, 2009. Silver, Voit & Thompson, Attorneys at Law, P.C. represents the Debtor in its restructuring efforts. Ross Consulting Services, LLC, and Carriage Hill Partners, Ltd., have been tapped as financial advisors. In its petition, the Debtor estimated $10 million to $50 million in assets and up to $10 million in liabilities as of the Chapter 11 filing. FANNIE MAE: Investor, Housing Lobby Clash on Fannie Future ---------------------------------------------------------- American Bankruptcy Institute reports that a private investor seeking a smaller government role in the U.S. housing market on Thursday clashed with housing-industry lobby groups who urged Congress to take its time to phase out mortgage giants Fannie and Freddie or risk limiting mortgage availability. About Fannie Mae Federal National Mortgage Association, aka Fannie Mae, is a government-sponsored enterprise that was chartered by U.S. Congress in 1938 to support liquidity, stability and affordability in the secondary mortgage market, where existing mortgage-related assets are purchased and sold. The Company's balance sheet at Dec. 31, 2010 showed $3.222 trillion in total assets, $3.224 trillion in total liabilities, and a $2.52 billion total deficit. Fannie Mae has been under conservatorship, with the Federal Housing Finance Agency acting as conservator, since September 6, 2008. As conservator, FHFA succeeded to all rights, titles, powers and privileges of the company, and of any shareholder, officer or director of the company with respect to the company and its assets. The conservator has since delegated specified authorities to Fannie Mae's Board of Directors and has delegated to management the authority to conduct day-to-day operations. The U.S. Department of the Treasury owns Fannie Mae's senior preferred stock and a warrant to purchase 79.9% of its common stock, and Treasury has made a commitment under a senior preferred stock purchase agreement to provide Fannie with funds under specified conditions to maintain a positive net worth. FIDDLER'S CREEK: Bondholders Want Examiner, Not Confirmation ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the bondholders' indenture trustee is asking the judge presiding over Fiddler's Creek LLC's Chapter 11 case to appoint an examiner to "investigate serious improprieties suspected of the debtors." U.S. Bank NA, the indenture trustee, said it discovered that "certain senior secured creditors' liens have been shifted to less valuable collateral and property." The indenture trustee also has a motion on the calendar to postpone the May 27 hearing to consider the Debtor's proposed Chapter 11 plan. Another motion by the indenture trustee alleges that Fiddler's Creek improperly solicited homeowners. About Fiddler's Creek Each of Fiddler's Creek, LLC, and its affiliates owns, operates or is otherwise affiliated with the premier, fully integrated, master planned residential community known as "Fiddler's Creek" in southwestern Florida. Fiddler's Creek is located in Collier County, Florida, approximately 12 miles southeast of the city of Naples and six miles north of Marco Island. The Fiddler's Creek development is comprised of nearly 4,000 zoned acres of prime land in Naples, Florida, and is planned for and capable of accommodating up to 6,000 residences upon projected build-out, which is estimated to be in 2020. Fiddler's Creek contains five distinctive neighborhoods known as: Fiddler's Creek, Veneta, Aviamar, Marsh Cove and Meadow Run. Fiddler's Creek filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 10-03846) on Feb. 23, 2010. Attorneys at Genovese Joblove & Battista, P.A., and at Woodward,Pires & Lombardo PA represent the Debtors. Judge Alexander L. Paskay presides over the case. The Company estimated assets and debts at $100 million to $500 million. The Official Unsecured Creditors' Committee is represented by Paul S. Singerman, Esq., Jordi Guso, Esq., and Debi Evans Galler, Esq., at Berger Singerman PA, in Miami, Florida. FIRST PHYSICIANS: Reports $1.04-Mil. Preliminary Loss for Q1 ------------------------------------------------------------ First Physicians Capital Group, Inc., filed with the U.S. Securities and Exchange Commission its preliminary unaudited consolidated income statement for the fiscal quarter ended March 31, 2011. The Company reported a net loss allocable to common stockholders of $1.04 million on $7.44 million of revenue from services for the fiscal quarter ended March 31, 2011, compared with a net loss allocable to common stockholders of $2.69 million on $9.60 million of revenue from services for the same period during the prior year. Given recent material transactions, the Company expects to be late in filing its financial results for the quarter ending March 31, 2011. In future quarters, the Company does not expect to record revenues and expenses from the hospitals recently sold. The Company does expect to receive payments on promissory notes that were issued to the Company by the various buyers in conjunction with the sales of the hospitals. The Company also expects to receive fees from its service offerings and lease payments from the lessees of the real estate facilities that it continues to own. The Company has transitioned its business model from being an owner-operator of hospitals to a service provider to hospitals. While there can be no assurances, the Company currently believes it will be more profitable going forward with lower future capital requirements. The Company recognizes that the continued expense of compliance with Sarbanes-Oxley requirements, financial and legal filings with the SEC, and professional fees associated with the preparation thereof is very costly for a company of its size. Therefore, the Company along with its bankers is evaluating its future status as a publicly-traded company. The Company is also sensitive to the fact that some investors would like the option of a full or partial liquidity event sooner rather than later. The current public market for the Company's common stock lacks liquidity and does not provide for this opportunity and is unlikely to improve on its own absent a significant transaction. Potential strategies or concepts under consideration by the Company include but are not limited to a going-private transaction such as a management buyout or sale to a financial buyer, a leveraged recapitalization, full or partial sale to a corporate buyer and/or a share repurchase program. The Company, working with its legal counsel, will provide information to investors in the near future as to the Company's plans regarding remaining a publicly-traded company, and will be available to discuss and answer questions on the choices presented at such time. A full-text copy of the press release announcing the preliminary financial results is available for free at http://is.gd/QrkGil About First Physicians Beverly Hills, Calif.-based First Physicians Capital Group, Inc. (OTC BB: FPCG) -- http://www.fpcapitalgroup.com/-- is an operator of healthcare services firms in the U.S. The Company's balance sheet at Dec. 31, 2010, showed $24.6 million in total assets, $28.9 million in total liabilities, $191,000 in non-redeemable preferred stock, $12.2 million in redeemable preferred stock, and a stockholders' deficit of $16.7 million. As reported in the Troubled Company Reporter on Feb. 21, 2011, Whitley Penn LLP, in Dallas, Texas, expressed substantial doubt about First Physicians Capital Group's ability to continue as a going concern, following the Company's results for the fiscal year ended Sept. 30, 2010. The independent auditors noted that the Company has experienced recurring losses from operations. FONAR CORP: Five Directors Elected at Annual Meeting ---------------------------------------------------- The Annual Meeting of Stockholders of Fonar Corporation was held at 10:00 a.m. on May 20, 2011, at the Double Tree Hotel, Wilmington Downtown, 700 King Street, Wilmington, Delaware 19801. At the meeting, the items of business were the election of five directors and ratification of the selection by the board of directors of Marcum LLP as the Company's auditors for the fiscal year ending June 30, 2011. The stockholders elected Raymond V. Damadian, M.D., Claudette J. V. Chan, Robert J. Janoff, Charles N. O'Data and Robert Djerejian, all of whom were sitting directors, as the directors of the Company. The stockholders also ratified the selection of Marcum LLP as the Company's auditors for the fiscal year ending June 30, 2011. About FONAR FONAR was incorporated in 1978, making it the first, oldest and most experienced MRI company in the industry. FONAR introduced the world's first commercial MRI in 1980, and went public in 1981. Since its inception, nearly 300 recumbent-OPEN MRIs and 150 UPRIGHT(R) Multi-Position(TM) MRI scanners worldwide have been installed. FONAR's stellar product line includes the Upright(TM) MRI (also known as the Stand-Up(TM) MRI), the only whole-body MRI that performs Position(TM) imaging (pMRI(TM)) and scans patients in numerous weight-bearing positions, i.e. standing, sitting, in flexion and extension, as well as the conventional lie-down position. Liquidity and Going Concern Marcum, LLP, in New York, N.Y., expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the fiscal year ended June 30, 2010. The independent auditors noted that Company has suffered recurring losses from operations, continues to generate negative cash flows from operating activities, has negative working capital at June 30, 2010, and is dependent on asset sales to fund its shortfall from operations. At March 31, 2011, the Company had a working capital deficit of approximately $7.3 million and a stockholders' deficiency of approximately $781,000. For the nine months ended March 31, 2011, the Company generated a net income of approximately $2.9 million, which included non-cash charges of approximately $2.8 million. FORTRESS ENERGY: CCAA Protection Extended Until June 30 ------------------------------------------------------- Fortress Energy Inc. disclosed its application to the Court of Queen's Bench of Alberta for an Order under the Companies' Creditors Arrangement Act (Canada) to extend its CCAA protection has been granted, allowing the Company to continue to prepare a plan of arrangement for its creditors if necessary, and staying all claims and actions against the Company and its assets. The extension under the Order granted will be in effect until June 30, 2011, at which time the matter will be reviewed by the Court. The order permits the Company to remain in possession and control of its property, carry on its business, and retain employees and other service providers. While the Order is in effect the Company will continue to work with its Court appointed Monitor, Hardie & Kelly Inc. Fortress has taken this step to enable Fortress to challenge a reassessment issued by the Canada Revenue Agency, which reassessment is in the amount of approximately $18 million. As a result of the reassessment, if the Company took no action, it would be compelled to immediately remit $9 million to the CRA and the Company does not have the necessary funds to remit. Other than the claim by CRA, Fortress has sufficient liquid assets to pay all other liabilities and trade payables. Fortress believes that the CRA's position is not sustainable and intends to vigorously dispute the CRA's claim. On March 28, 2011, Fortress filed a Notice of Objection to the reassement with Appeals Division of the CRA and is awaiting a response from an Appeals Officer. FREEWAY FOODS: Landlord's Suit Stays in Bankruptcy Court -------------------------------------------------------- Bankruptcy Judge Thomas W. Waldrep, Jr., denied plaintiff's request to remand the lawsuit, Jane H. Walter, v. Freeway Foods, Inc., Freeway Foods of Greensboro, Inc., Gary M. Fly, individually, Lynne R. Fly, individually, Yellow Sign, Inc., and Waffle House, Inc., Adv. Proc. No. 10-02057 (Bankr. M.D.N.C.). The Court finds that mandatory abstention does not apply, and declines to exercise its discretion to permissively abstain from hearing the Adversary Proceeding or to remand it to state court. For the time being, the Adversary Proceeding will proceed in the Bankruptcy Court. A copy of the Court's May 24, 2011 Memorandum Opinion is available at http://is.gd/O5Y8Nifrom Leagle.com. On July 30, 2010, Ms. Walter, the owner of certain real property on which was located a Waffle House franchise operated by the Debtor, filed suit in the Superior Court of Guilford County, North Carolina, against the Debtor; Gary and Lynne Fly, the principals of the Debtor; Waffle House, the franchisor of the Debtor's Waffle House locations; and YSI, an affiliate of Waffle House, seeking damages as a result of an alleged scheme between and among the Defendants to defraud her. Freeway Foods of Greensboro, Inc., was in the business of operating 36 Waffle House franchises in North Carolina until an involuntary Chapter 7 bankruptcy was filed against it (Bankr. M.D.N.C. Case No. 10-11282) on July 13, 2010. GALLERY ROW: Case Summary & 9 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Gallery Row Limted Partnership an Arizona Limited Partnership 2850 East Skyline Drive, Suite 200 Tucson, AZ 85718 Bankruptcy Case No.: 11-15540 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court District of Arizona (Tucson) Judge: Eileen W. Hollowell Debtor's Counsel: Sally M. Darcy, Esq. MCEVOY, DANIELS & DARCY P.C. Camp Lowell Corporate Center 4560 East Camp Lowell Drive Tucson, AZ 85712 Tel: (520) 326-0133 Fax: (520) 326-5938 E-mail: DarcySM@aol.com Scheduled Assets: $2,202,062 Scheduled Debts: $6,953,663 A list of the Company's nine largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/azb11-15540.pdf The petition was signed by Michael J. Hanson, GRLP, LLC, general partner of Gallery Row. GARLOCK SEALING: Given Plan Exclusivity Until Nov. 28 ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that for a second time, Garlock Sealing Technologies LLC asked the bankruptcy judge to require asbestos claimants to file claims. Ordinarily, a claim includes little more than the amount of the debt and a brief statement of the basis for the liability. Garlock instead wanted creditors to include extensive information about the basis for the claim and the resulting illness, if any. U.S. Bankruptcy Judge George R. Hodges in Charlotte, North Carolina said "no" in an order this month. Judge Hodges said he wanted a trial estimating the total amount of asbestos claims, not a valuation on a claim-by-claim basis. According to the report, Garlock also wanted discovery from other companies that already completed Chapter 11 reorganization. In addition, Garlock wanted discovery from lawyers for asbestos plaintiffs. Again, Hodges said "no" in an order last week. Judge Hodges, according to Mr. Rochelle, did make one ruling in Garlock's favor. The creditors' committee wanted the judge to allow them to file their own plan when the company's exclusivity expires on May 31. Instead, Judge Hodges extended Garlock's exclusive right to file a plan until Nov. 28. About Garlock Sealing Headquartered in Palmyra, New York, Garlock Sealing Technologies LLC is a unit of EnPro Industries, Inc. (NYSE: NPO). For more than a century, Garlock has been helping customers efficiently seal the toughest process fluids in the most demanding applications. On June 5, 2010, Garlock filed a voluntary Chapter 11 petition (Bankr. W.D. N.C. Case No. 10-31607) in Charlotte, North Carolina, to establish a trust to resolve all current and future asbestos claims against Garlock under Section 524(g) of the U.S. Bankruptcy Code. The Debtor estimated $500 million to $1 billion in assets and up to $500 million in debts as of the Petition Date. Affiliates The Anchor Packing Company and Garrison Litigation Management Group, Ltd., also filed for bankruptcy. The filing covers only Garlock operations in Palmyra, New York and Houston, Texas. Garlock Rubber Technologies, Garlock Helicoflex, Pikotek, Technetics, Garlock Europe and Garlock operations in Canada, Mexico or Australia are not affected by the filing, nor is EnPro Industries or any other EnPro operating subsidiary. Albert F. Durham, Esq., at Rayburn Cooper & Durham, P.A., represents the Debtor in its Chapter 11 effort. Garland S. Cassada, Esq., at Robinson Bradshaw & Hinson, serves as counsel for asbestos matters. The Official Committee of Asbestos Personal Injury Claimants in the Chapter 11 cases is represented by Travis W. Moon, Esq., at Hamilton Moon Stephens Steele & Martin, PLLC, in Charlotte, NC, Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, in New York, and Trevor W. Swett III, Esq., Leslie M. Kelleher, Esq., and Jeanna Rickards Koski, Esq., in Washington, D.C. 20005. Joseph W. Grier, III, the Court-appointed legal representative for future asbestos claimants, has retained A. Cotten Wright, Esq., at Grier Furr & Crisp, PA, and Richard H. Wyron, Esq., and Jonathan P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, as his co- counsel. About 124,000 asbestos claims are pending against Garlock in state and federal courts across the country. The Company says majority of pending asbestos actions against it is stale and dormant -- almost 110,000 or 88% were filed more than four years ago and more than 44,000 or 35% were filed more than 10 years ago. A schedule of the pending asbestos actions is available for free at: http://bankrupt.com/misc/Garlock_PendingAsbestosActions.pdf GIGI PROPERTIES: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: GIGI Properties, LLC 1955 S State Rd 7 Ft. Lauderdale, FL 33317 Bankruptcy Case No.: 11-24293 Chapter 11 Petition Date: May 25, 2011 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: John K. Olson Debtor's Counsel: Mary Jo Rivero, Esq. MARY JO RIVERO, P.A. 1806 N Flamingo Rd #355 Pembroke Pines, FL 33028 Tel: (954) 704-9332 Fax: (954) 704-2388 E-mail: ecf@maryjorivero.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Gigi Stetler, manager. GOLDENPARK, LLC: Gets Interim Access to Urban's Cash Collateral --------------------------------------------------------------- The U.S. Bankruptcy court for the Central District of California authorized on an interim basis, Goldenpark LLC, to use revenues from its hotel operations to pay expenses of maintaining and operating the hotel. The Court will convene a final hearing on June 8, 2011, to consider the Debtor's request for continued access o the cash collateral. Objections, if any, are due June 1. As reported in the Troubled Company Reporter on May 23, the revenues represent cash collateral securing the Debtor's obligations to Urban Commons Sycamore LLC. Goldenpark said it owes Urban $17.5 million under a secured loan that Urban assumed from Wilshire State Bank. According to Goldenpark, it maintained a productive relationship and was operating under a temporary forbearance with Wilshire. The situation was different with Urban, which, according to the Debtor, maintains a "reputation for acquiring debt to foreclose and operate real properties." Urban declared the loan in default in January 2011. The Debtor requested that the foreclosure be stayed so it could close on a sale of the Hotel, which was under contract to a third party for $24 million. Urban refused and commenced foreclosure proceedings on March 30. Urban requested the appointment of a receiver for the Hotel. The Debtor filed for bankruptcy one day before the scheduled hearing on Urban's request for a receiver. The Debtor said it has prepared a budget reflecting its ordinary and necessary operating expenses that must be paid postpetition to preserve the business. The budget was prepared collectively through the efforts of the Debtor's ownership well as a third party independent management company, Hotel Management Group LLC. According to the Debtor, Urban and other creditors who may assert an interest in the cash collateral are adequately protected by the use of cash collateral. Urban is protected by an equity cushion of roughly 22.9% and the remaining secured creditors are protected by equity cushions of roughly 17.1% and 17.04%. The secured creditors will be further protected by the continuing management and operation of the Hotel, thereby preserving the value of their collateral. If there are cash flow shortages, further adequate protection will be provided by the fact that Dae In Kim will fund the shortfalls from non-estate funds as capital contributions. The Debtor is also authorised to pay (1) pay prepetition priority wages and commissions; and (2) honor accrued vacation and leave benefits. About Goldenpark LLC Goldenpark LLC operates a 171-room hotel in Norwalk, California. Pursuant to a franchise agreement with Hilton Worldwide, the hotel is currently being operated as a Double Tree Hotel. Goldenpark LLC filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-30070) on May 8, 2011, to halt a secured lender's attempt to place the hotel in the hands of a receiver. Judge Peter Carroll presides over the case. Levene Neale Bender Rankin & Brill LLP serves as the Debtor's counsel. In its petition, the Debtor listed $10 million to $50 million in both assets and debts. The petition was signed by Dae In Kim, managing member. GOLDENPARK, LLC: Wants Until June 6 to File Schedules & Statements ------------------------------------------------------------------ GoldenPark, LLC, asks the U.S. Bankruptcy Court for the Central District of California to extend until June 6, 2011, its time to file its schedules of assets and liabilities and statement of financial affairs. The Debtor relates that its needs more time to prepare the documents. Norwalk, California-based Goldenpark, LLC, filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 11-30070) on May 8, 2011. Bankruptcy Judge Peter Carroll presides over the case. David B. Golubchik, Esq., at Levene Neale Bender Yoo & Brill LLP, represents the Debtor in its restructuring effort. The Debtor estimated assets and debts at $10 million to $50 million. GREAT ATLANTIC PRE-CAST: Case Summary & Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: Great Atlantic Pre-Cast Concrete & Statuary, Inc. 225 Ellis Street Staten Island, NY 10307 Bankruptcy Case No.: 11-44473 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Elizabeth S. Stong Debtor's Counsel: Yann Geron, Esq. FOX ROTHSCHILD LLP 100 Park Avenue, 15th Floor New York, NY 10017 Tel: (212) 878-7900 Fax: (212) 692-0940 E-mail: ygeron@foxrothschild.com Scheduled Assets: $2,302,000 Scheduled Debts: $5,430,659 A list of the Company's 15 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nyeb11-44473.pdf The petition was signed by Virginia Fresca, vice president and secretary. GREAT ATLANTIC & PACIFIC: Wants to Start Superfresh Closing Sales ----------------------------------------------------------------- BankruptcyData.com reports that Great Atlantic & Pacific Tea Company filed a motion in the U.S. Bankruptcy Court for an order authorizing the Company to (i) commence store closing sales at certain Superfresh Banner stores, in accordance with the Court- approved store rationalization procedures issued on March 10, 2011, and (ii) sell assets in connection therewith free and clear of liens, claims or encumbrances. The motion explains, "After the conclusion of the marketing process and an extensive two-day auction, the Debtors obtained bids for various packages of assets that upon Court approval, will generate more than $40 million in cash proceeds for the estates, free the Debtors from significant costs of operating underperforming stores, and potentially offer continued employment opportunities for A&P employees at certain stores to be purchased by grocery store operators." About Great Atlantic & Pacific Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific is a leading supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid- Atlantic and Northeastern United States. It operates 395 supermarkets, combination food and drug stores, beer, wine, and liquor stores, and limited assortment food stores in Connecticut, Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Virginia, and the District of Columbia. "Banners" include A&P (101 stores), Food Basics (12 stores), Pathmark (128 stores), Super Fresh (57 stores), The Food Emporium (16 stores), and Waldbaum's (59 stores). A&P employs roughly 41,000 employees, including roughly 28,000 part-time employees. Roughly 95% of the workforce are covered by collective bargaining agreements. A&P and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010 in White Plains, New York. In its petition, A&P reported total assets of $2.5 billion and liabilities of $3.2 billion as of Sept. 11, 2010. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. Lazard Freres & Co. LLC is the financial advisor. Huron Consulting Group is the management consultant. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represent the Official Committee of Unsecured Creditors. GREAT CHINA INTERNATIONAL: Posts $733,800 Net Loss in Q1 2011 ------------------------------------------------------------- Great China International Holdings, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $733,775 on $1.7 million of revenues for the three months ended March 31, 2011, compared with a net loss of $812,744 on $1.8 million of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $60.1 million in total assets, $37.9 million in total liabilities, and stockholders' equity of $22.2 million. Kabani & Company, Inc., in Los Angeles, California, expressed substantial doubt about Great China International's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has a working capital deficit of $27.8 million as of Dec. 31, 2010, and in addition, has negative cash flow from operations and net loss for the year ended Dec. 31, 2010, of $299,799 and $3.2 million, respectively. A copy of the Form 10-Q is available at http://is.gd/J9Uyt0 Headquartered in Shenyang, PRC, Great China International Holdings, Inc., through its various subsidiaries, is or has been engaged in commercial and residential real estate leasing, management, consulting, investment, development and sales. The Company conducts all its operation in the People's Republic of China through its direct and indirect wholly owned subsidiaries" Shenyang Maryland International Industry Company Limited and Silverstrand International Holdings Company Limited. The Company was incorporated in the State of Nevada on Dec. 4, 1987, under the name of Quantus Capital, Inc., and in 1992, it changed its name to Red Horse Entertainment Corporation. Effective July 5, 2005, the Company completed the acquisition of Silverstrand International Holdings Limited, a Hong Kong limited liability company. On Sept. 15, 2005, the Company changed its name to Great China International Holdings, Inc., from Red Horse Entertainment Corporation. GREEN ENERGY MANAGEMENT: Incurs $12.7 Million Net Loss in Q1 2011 ----------------------------------------------------------------- Green Energy Management Services Holdings, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $12.7 million on $4,307 of contract revenue earned for the three months ended March 31, 2011, compared with a net loss of $53,972 on $201,727 of contract revenue earned for the same period last year. Selling, general and administrative expenses for the three months ended March 31, 2011, and 2010, were $12.7 million and $78,381, respectively. The Company's balance sheet at March 31, 2011, showed $1.6 million in total assets, $883,477 in total liabilities, and stockholders' equity of $684,718. As reported in the TCR on April 8, 2011, MaloneBailey, LLP, in Houston, expressed substantial doubt about Green Energy Management's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations. A copy of the Form 10-Q is available at http://is.gd/m6ZOQb Teaneck, N.J.-based Green Green Energy Management Services Holdings, Inc., is full service energy management company. The Company also provides residential and commercial electrical contractor services. During the second half of 2010, the Company underwent a significant shift in its business strategy away from the former Southside ("Southside Electric Corporation, Inc.") contracting business to the new strategy of Energy Efficiency and energy management. As a result, all of the Company's resources have been devoted to procuring new contracts pursuant to this new strategy. GREEN MOUNTAIN: Moody's Upgrades Bank Debt Rating to 'Ba2' ---------------------------------------------------------- Moody's Investors Service, Inc. upgraded the senior secured debt ratings on Green Mountain Coffee Roasters, Inc.'s amended and extended $1.25 billion bank facility to Ba2 from Ba3 and affirmed the company's Ba3 Corporate Family Rating and B1 Probability of Default Rating. Moody's also upgraded the company's Speculative Grade Liquidity Rating to SGL-2 from SGL-3. The rating outlook is stable. The upgrades of the senior secured debt and SGL ratings reflect improvements to the collateralization for the company's secured debt and the enhanced liquidity profile that resulted from the recent common equity sale earlier this month that raised $689 million. A portion of the proceeds from the equity offering were used to repay $350 million of the company's $549 million senior secured Term Loan B bank facility, which reduced the amount of outstanding senior secured debt to about $630 million, or 4.9% of its total market capitalization, and reduced debt /EBITDA to about 1.6 times. The increased amount of collateral relative to the amount of remaining secured debt resulted in an upgrade to those debt instruments. The remaining outstanding amounts under the Term Loan B will be repaid as part of a proposed amendment to the existing $1.45 billion of senior secured facilities. Under the proposed amendment, the current bank facilities consisting of a $650 million revolving credit facility, a $250 million Term Loan A, and a $550 million Term Loan B, will be amended to expand the revolving credit facility to $1 billion and to repay the $550 million Term Loan B, resulting in a $200 million reduction of the total facility size to $1.25 billion from $1.45 billion. The new revolving credit facility will include a line for multi-currency borrowings of at least $200 million, the size of the line included in the existing revolving credit facility. Pricing will be reduced and the maturity date will be extended from December 2015 to June 2016. Upon closing of the amendment, expected by the end of June 2011, the ratings on the Term Loan B will be withdrawn. RATINGS RATIONALE The Ba3 Corporate Family Rating reflects the expanding base and growing retail acceptance of GMCR's category-leading Keurig single-cup brewers, which in turn drive sales of its high-margin K-Cup portion packs. The rating also reflects the company's aggressive growth strategy that has involved the rapid consolidation of K-Cup licensees in recent years and the formation of key strategic partnerships that Moody's expects to spur incremental demand for Keurig brewers and K-Cups. GMCR's rapid organic growth (over 50% rate) has placed heavy demands on its highly concentrated supply chain and distribution network. These demands will likely intensify in the coming year as the company implements the recently announced strategic partnerships with Dunkin Donuts, Starbucks and ConAgra Foods to provide selected brands in the K-Cup single-serve format. Moody's expects these strategic partnerships to build consumer awareness of the single-serve brewing format and to expand GMCR's loyal base of K-Cup consumers. Although gross cash flows have grown rapidly, the incremental working capital and plant expansion required to keep up with rapid demand growth has consumed substantially all of GMCR's operating cash flow. The resulting negative free cash flows are likely to persist for the foreseeable future. However, the recent cash equity raised provides important financial cushion that should allow GMCR to fund its rapid growth while maintaining modest financial leverage. GMCR could face direct competition in the manufacturing and marketing of K-Cups as early as 2012, when two principal patents expire. This will open the door for other coffee makers to produce their own K-Cups, royalty-free. Moody's expects that over time this will lead to a gradual decline in the company's K-Cup market share and profit margins. But if the product category continues to expand at its current rate, GMCR may be able to grow earnings for the foreseeable future, although at a slower rate. It is not clear whether its strategic relationships with other coffee makers will provide material protection against K-Cup competition after patent expiration, but Moody's assumes that its most capable partners will secure their right to exit the relationship under certain conditions. Ratings upgraded: Green Mountain Coffee Roasters, Inc. -- $1,000 million of amended senior secured revolving credit facilities expiring June 2016 at Ba2 (LGD 2, 27%); -- $250 million amended senior secured bank Term Loan A expiring June 2016 at Ba2 (LGD 2, 27%); -- Speculative Grade Liquidity Rating to SGL-2 from SGL-3. Ratings affirmed: Green Mountain Coffee Roasters, Inc. -- Corporate Family Rating at Ba3; -- Probability of Default Rating at B1; Ratings to be withdrawn: Green Mountain Coffee Roasters, Inc. -- $550 million senior secured bank Term Loan B expiring December 2015 at Ba3 (LGD 3, 30%). The SGL-2 rating is based on Moody's expectation that GMCR will have adequate liquidity over the next twelve months, but may rely on seasonal borrowings to fund growth-related working capital needs and capital investments. Working capital needs typically peak near the end of the fourth quarter as the company builds brewer inventory for the holiday season. Given the company's high demands for growth capital, Moody's does not anticipate positive free cash flow generation in the near-term. The bank debt instrument ratings reflect both the overall probability of default (as reflected in the B1 PDR) and a below- average mean family loss given default assessment of 35% (or an above-average mean family recovery estimate of 65%), in line with Moody's LGD Methodology and typical treatment for an all-first- lien bank senior secured debt capital structure. The principal methodology used in rating Green Mountain Coffee Roasters, Inc. was Global Packaged Goods Industry published in July 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009 A rating upgrade is unlikely to occur until GMCR is generating positive free cash flow on a sustained basis, which Moody's does not expect to occur in the near-term. The company would also need to improve the diversity and robustness of its supply chain and distribution networks before Moody's would consider an upgrade. The company would also need to resolve the ongoing SEC inquiry and the uncertainty related to upcoming patent expirations. Quantitatively, a rating upgrade would require debt / EBITDA to be sustained below 3.5 times. Ratings could be downgraded if liquidity erodes and/or GMCR faces deteriorating operational performance, including a major decline in i) installed base of active Keurig coffee brewers; ii) gross margins; or iii) GMCR's K-Cup sales. A downgrade may also occur if the company experiences a major disruption in its supply chain or distribution network, or if the ongoing SEC inquiry has a significantly more negative outcome than Moody's is anticipating. Quantitatively, ratings could be downgraded if management pursues more debt-financed acquisitions or if debt-to-EBITDA rises above 4.0 times. Corporate Profile Green Mountain Coffee Roasters, Inc. based in Waterbury, Vermont, is a manufacturer of specialty coffee and other hot beverages, and single serve coffee brewing systems. The company's operations are managed through two business units. The Specialty Coffee business unit produces coffee, tea and hot cocoa from its family of brands, including Tully's Coffee(R), Green Mountain Coffee(R), Newman's Own(R) Organics coffee, Timothy's World Coffee(R), Diedrich(R), and Van Houtte(R). The Keurig business unit manufactures gourmet single-cup brewing systems and GMCR produces the K-Cup(R) portion packs for Keurig(R) Single-Cup Brewers. Sales for the last-twelve months ended March 26, 2011 were $1.9 billion. GREENMAN TECHNOLOGIES: Posts $2.3-Mil. Loss in Fiscal 2nd Quarter ----------------------------------------------------------------- GreenMan Technologies, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $2.3 million on $914,287 of sales for the three months ended March 31, 2011, compared with a net loss of $1.7 million on $248,004 of sales for the three months ended March 31, 2010. Net sales from continuing operations for the six months ended March 31, 2011, increased $1.0 million or 148% to $1.7 million as compared to net sales of $687,860 for the six months ended March 31, 2010. Net loss for the six months ended March 31, 2011, was $3.8 million as compared to $3.3 million for the six months ended March 31, 2010. The Company's balance sheet at March 31, 2011, showed $5.2 million in total assets, $5.9 million in total liabilities, and a stockholders' deficit of $733,895. Schechter Dokken Kanter Andrews & Selcer, Ltd., in Minneapolis, Minnesota, expressed substantial doubt about GreenMan Technologies' ability to continue as a going concern, following the Company's results for the fiscal year ended Sept. 30, 2010. The independent auditors noted that the Company has continued to incur substantial losses from operations, has not generated positive cash flows and has insufficient liquidity to fund its ongoing operations. A copy of the Form 10-Q is available at http://is.gd/m8EZ0o Lynnfield, Mass.-based GreenMan Technologies, Inc. (OTC QB: GMTI) through its two alternative energy subsidiaries, American Power Group, Inc. ("APG") and APG International, Inc. ("APGI"), provides a cost-effective patented dual fuel conversion technology for diesel engines and diesel generators. GULF FLEET: Wants Cash Collateral Access Extended Until Aug. 5 -------------------------------------------------------------- Gulf Fleet Holdings, Inc., et al., ask the U.S. Bankruptcy Court for the Western District of Louisiana to approve a third stipulation, extending until Aug. 5, 2011, the Debtors' use of the cash collateral. The Court previously granted the Debtor permission to access the cash collateral. The stipulation was entered among the Debtors, Comerica Bank, as agent and on behalf of the senior bank lenders and Brightpoint Capital Partners Master Fund, L.P., as subordinate agent on behalf of the subordinate lenders. The Debtors would use the cash collateral to fund their Chapter 11 case, pay suppliers and other parties. As of the Petition Date, the Debtors estimate that they had $1.2 million of cash collateral in accounts maintained at Comerica Bank and Iberia Bank. The Debtors entered into: a. a $67 million revolving credit and term loan agreement, dated as of May 2007, as amended on August 2007 and January 2010, with (a) Comerica Bank, as lender and administrative agent (the Agent); (b) BBVA Compass Bank; (c) ING Capital, LLC; and (d) PNC National Association. As of the Petition Date, the Debtors allegedly owe a total sum of approximately $37.5 million under the Credit Agreement; b. a $6 million Term B Loan Agreement, dated May 2007, and amended on January 2010, with Brightpoint. As of the Petition Date, the Debtors owe approximately $7.6 million under this subordinated debt agreement; c. a $6 million term loan term loan agreement and security agreement, dated as of October 2008, and amended on January 2010, with LBC Credit Partners II, L.P. As of the Petition Date, the Debtors allegedly owe approximately $6.2 million under this agreement; d. $4.25 million term loan and security agreement, dated as of October 2008, and amended on January 2010 with Bank One Equity Investors-BIDCO, Inc. As of the Petition Date, the Debtors allegedly owe approximately $3.9 million under this agreement; e. $1.2 million retail loan and security agreement, dated as of August 2006, with Bank of America. As of the Petition Date, about $1.1 million is owed under this agreement; f. a factoring agreement, dated September 2009, with Gulf Fleet Financing, LLC. Pursuant to this agreement, Gulf Financing purchased accounts receivable with a face amount of approximately $2.9 million from the Debtors for a purchase price of approximately $2.9 million; and g. two convertible subordinated notes in favor of Gulf Fleet Financing, LLC, in the amounts of $5,452,600 and $2,897,400 respectively, and both of which are dated January 2010. In exchange for using the cash collateral, the Debtors will grant the Agent replacement liens on and first priority postpetition security interests in all assets of any of the Debtors, an allowed administrative superpriority expense claim against each Debtor on all of the Postpetition Collateral. About Gulf Fleet Lafayette, Lousiana-based Gulf Fleet Holdings, Inc. -- along with affiliates Star Marine, LLC; Gulf Wind, LLC; Gulf Service, LLC; Gulf Worker, LLC; Hercules Marine, LLC; Gulf Fleet, LLC; Gulf Fleet Marine, Inc.; Gulf Fleet Management, LLC; Gulf Fleet Offshore, LLC; and Gulf Ocean Marine Services, LLC -- filed for Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. W.D. La. Case No. 10-50713). Gulf Fleet estimated $100 million to $500 million in assets and $50 million to $100 million in debts in its Chapter 11 petition. In their schedules, affiliate Gulf Fleet, LLC, disclosed $2,088,277 in assets and $83,891,116 in liabilities; Gulf Fleet Management, LLC, disclosed $943,256 in assets and $45,071,399 in liabilities; and Gulf Ocean Marine Services, LLC, disclosed $15,777,138 in assets and $79,513,230 in liabilities. R. Michael Bolen, U.S. Trustee for Region 5 appointed seven members to the official committee of unsecured creditors. The Committee is represented by Alan H. Goodman, Esq., Christopher D. Johnson, Esq., and Hugh M. Ray, Jr., Esq. GULF OFFSHORE: S&P Affirms CCR at 'CCC+'; Outlook Developing ------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its preliminary 'CCC+' corporate credit rating on Louisiana-based Gulf Offshore Logistics Holdings LLC. The outlook is developing. "At the same time, we withdrew the preliminary 'CCC+' issue and preliminary '3' recovery ratings on the company's proposed $110 million secured fixed rate notes after it announced a revised deal. We assigned a preliminary 'B-' issue rating (one notch above the preliminary corporate credit rating) and a preliminary '2' recovery rating to GOL's newly proposed $75 million secured floating rate notes due 2016. The '2' recovery rating indicates our expectation of substantial (70% to 90%) recovery in the event of a payment default," S&P stated. "In addition, we assigned a preliminary 'CCC-' issue rating (two notches below the preliminary corporate credit rating) and a preliminary '6' recovery rating to GOL's proposed $35 million secured term B fixed rate notes due 2016 plus warrants. The '6' recovery rating indicates our expectation of negligible (0% to 10%) recovery in the event of a payment default. The company will use proceeds from the two issues to repay outstanding debt and to fund acquisitions and working capital," S&P continued. "The preliminary ratings on GOL reflect the company's position as a participant in the highly cyclical and competitive offshore marine services segment of the oilfield services sector; small size and scale; limited geographic diversity with a majority of vessels in the Gulf of Mexico, which has been affected by the Macondo incident; concentrated customer base; low barriers to entry in GOL's business space; and its less than adequate liquidity," said Standard & Poor's credit analyst Patrick Y. Lee. The ratings also reflect GOL's younger-than-average fleet that permits the company to obtain higher day rates, long-term contracting of a majority of its fleet, and minimal nonacquisition capital expenditure requirements. The offshore marine services business in which GOL competes is a relatively fragmented segment of the oilfield services industry where barriers to entry are modest and competitive differentiation is difficult to establish. To offset these issues, GOL focuses on deepwater operations, which require more specialized equipment and which tend to have higher day rates than vessels that work continental shelf activities. Moreover, relative to its much larger, often publicly traded competitors, GOL has a newer fleet of vessels that are more sought after by exploration and production companies and, therefore, can capture higher day rates and utilization figures. The company prefers to keep about 70% of its company-owned fleet on contract, which helps to provide some revenue visibility and helps keep utilization over 90%. "The outlook is developing because we could raise or lower the ratings depending on Gulf of Mexico market conditions, on whether GOL procures a revolving credit facility, and on the specific size and terms and conditions of such a facility. We may take a negative rating action if the company is unable to procure a revolving credit facility and the company does not garner day rates and utilization sufficiently high enough to preclude fixed charges from outstripping cash flow and thus erode its limited liquidity. If market conditions stabilize and the company obtains a credit facility, then we could consider raising the corporate credit rating to 'B-' from 'CCC+'. The addition of higher priority first lien revolving credit facility debt, however, could result in the recovery rating on the floating notes being revised down to '3', indicating expectations of meaningful (50% to 70%) recovery in the event of a payment default. Thus, if GOL obtains higher priority revolving debt and we raise the corporate credit rating to 'B-', then the issue rating on the floating notes could remain a 'B-'. If GOL obtains higher priority revolving debt, but we do not raise the corporate credit rating to 'B-', then the issue rating on the floating notes could be lowered to 'CCC+'," S&P explained. HARROGATE INC: Fitch Lowers Rating on Revenue Bonds to 'BB+' ------------------------------------------------------------ As part of its continuous surveillance effort Fitch Ratings has downgraded these bonds to 'BB+' from 'BBB-' issued on behalf of Harrogate, Inc.: -- $13.6 million New Jersey Economic Development Authority revenue bonds, series 1997. The Rating Outlook is Stable. Rating Rationale -- The downgrade reflects Harrogate missing its debt service coverage covenant in 2010, due to a decline in independent living occupancy that has continued through the interim period; -- Liquidity is solid and provides Harrogate with a significant amount of financial flexibility at the current rating level; -- Harrogate continues to benefit from its management contract with Life Care Services LLC, one of the nation's leading nonprofit managers of continuing care retirement communities (CCRC); -- Other credit concerns include a competitive service area and deferred capital spending, as reflected by a high age of plant of 19.5 years. Key Rating Drivers -- Harrogate's sales continue their positive trend, stabilizing occupancy, resulting in debt service coverage above the 1.2x covenant. Security: The bonds are secured by mortgage on certain property and equipment and a debt service reserve fund. Credit Summary: The downgrade to Harrogate's rating is based primarily on Harrogate missing its debt service coverage covenant of 1.2 times (x) in 2010, but debt service coverage was greater than 1x. Harrogate missed the covenant due to a decline in independent living occupancy that has affected entrance fees receipts. ILU occupancy continued to decline in 2011. As of March 31, 2011, ILU occupancy was 77%, down from 80% at year end 2010, and much lower than 2008 when it was at 85.5%. The lower occupancy has reflected stress in the local area housing market, as well as higher than expected turnover of units. In 2010, Harrogate turned over 38 units and had net sales of 22 units. Through the first five months of 2011, Harrogate already has 14 sales but turnover has remained elevated at 18. In response to the negative occupancy trend, Harrogate has worked to contain expenses, replaced its marketing director, and has worked with outside firms to improve marketing efforts and help facilitate potential resident move-ins. The improved sales in 2011 reflect this effort. However, occupancy will remain a challenge over the near term. Additionally, by June 8, Harrogate's management will be hiring a consultant to review operations as part of its compliance with its debt service violation. Liquidity remains strong for the rating level and provides Harrogate with a financial cushion. As of March 31, 2011, Harrogate had 287.3 days cash on hand, a cushion ratio of 9 times, and cash to debt of 92.1% Beyond declining occupancy, credit concerns include deferred capital spending as reflected in a high average age of plant and competitive service area. Harrogate has postponed indefinitely a large capital project that would include a new assisted living building and refurbished Health Center. Fitch believes the projects are necessary for Harrogate to continue to remain competitive, and Harrogate's management has indicated that it remains dedicated to this building project but will not commence financing and construction until occupancy improves significantly. Additionally, Harrogate has a formidable competitor within 17 miles of its service area, Seabrook, a large Erickson-managed, type 'C', continuing care retirement community (CCRC). The stable outlook reflects Fitch's belief that Harrogate's liquidity provides the financial cushion needed for Harrogate to work through its occupancy and operating challenges. However, should entrance fee receipts remain weak and Harrogate fails to meet its 1.2x coverage for a second year, further negative rating pressure may occur. Harrogate is a type 'A' CCRC located in Lakewood, New Jersey with 275 ILUs and 68 SNF beds. Total revenues in FY 2010 were $17.8 million. Harrogate provides its annual financial statements to the Municipal Securities Rulemaking Board's EMMA system. HEALTHSPRING INC: S&P Affirms Counterparty Credit Rating at 'B+' ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on HealthSpring Inc. to positive from stable. Standard & Poor's also said that it affirmed its 'B+' counterparty credit rating on the company and its 'B+' ratings on the company's debt. In addition, Standard & Poor's withdrew its ratings on subsidiary Bravo Health Inc. at the company's request. "The outlook revision is based on our view that HealthSpring's credit profile is maturing to a level consistent with a higher rating category because of its improving business and financial risk fundamentals," said Standard & Poor's credit analyst James Sung. "In addition, we have factored in a more favorable view of the company's Medicare Advantage market given the added clarity regarding the new payment methodology and rates for 2012." HealthSpring's solidifying competitive position in the Medicare Advantage and Part D markets and key credit ratios (ROR, debt leverage, EBITDA coverage) are currently consistent with a higher rating category. Over the past 12 months, HealthSpring has achieved significant organic and acquisition-based membership growth while maintaining strong operating margins and good expense control. In March 2011, the company raised $301.5 million in an 8.625 million share common stock issuance and used $263.4 million of the net proceeds for debt repayment. "In our view, HealthSpring is well positioned to continue its strong performance because of key competitive strengths, such as its improving scale and diversification, organic and geographic expansion, and effective medical cost management. Over the long term, we believe these strengths will allow HealthSpring to compete effectively against peers and take advantage of favorable industry trends (Baby Boomers, industry consolidation) while adequately managing reform-related risks. For 2011, we expect HealthSpring to achieve key operational targets such as MA membership growth of about 35,000 members, stand-alone PDP membership growth of 135,000-155,000 members, total revenues of $5.4 billion, pretax income (EBT) of $360 million-$380 million, and a pretax ROR of 6.5%-7.0%," S&P stated. "We have refrained from raising the rating immediately because HealthSpring has not yet operated its Bravo acquisition (its largest to date) successfully for at least several quarters (it was acquired in November 2010). Although HealthSpring has largely integrated the Bravo acquisition from a core operational standpoint, the full integration of physician engagement practices -- as well as its systems and drug formularies, for example -- will take additional time to execute. Historically, Bravo has operated with a higher medical loss ratio and operating expense structure than HealthSpring. Bravo is HealthSpring's most challenging acquisition to date given its size and scale, new geographic regions, new products (Medicaid), and generally less- integrated physician practices," S&P stated. S&P noted, "We expect that HealthSpring will make more acquisitions over the next 12 months (as it has stated), which would introduce new integration risks and potentially higher debt leverage. However, this would not necessarily preclude an upgrade given management's track record of integrating acquisitions and paying off debt quickly." "The positive outlook indicates that there is at least a one-in- three likelihood that we will raise our counterparty credit rating on HealthSpring over the next six to 12 months. A combination of continued strong operating results and an uneventful integration progress with Bravo Health would likely lead to a one-notch upgrade. However, if the company makes further acquisitions within this timeframe, we would consider various factors -- such as the size and type of the acquisition, the financing used, and the proposed integration strategy -- before raising the rating. If the company were to make a significant acquisition outside of its core Medicare expertise, we would likely be more conservative in our upgrade consideration. From a credit ratio perspective, we expect the company keep its debt to capital consistent with its historical 25%-35% range and for EBITDA interest coverage to remain above 10x. In addition, we expect the company to maintain a good level of statutory capitalization," S&P added. HEARUSA INC: U.S. Trustee Appoints 5-Panel Creditors' Committee --------------------------------------------------------------- Chapter11Cases.com reports that the United States Trustee for Region 21 announced the appointment of an Official Committee of Unsecured Creditors for HearUSA Inc.'s bankruptcy case. The members of the Creditors' Committee are: (1) Hansaton Accoustics Inc., (2) Phonak LLC, (3) Family Hearing Aid Center, (4) JKG Group, and (5) Dalco Contingency, LLC The U.S. Trustee has selected the representative of Hansaton Acoustics to act as the temporary chairperson for the Committee. Based in West Palm Beach, Florida, HearUSA Inc. sells hearing aids in 10 states. The Company filed for Chapter 11 bankruptcy protection on May 16, 2011 (Bankr. S.D. Fla. Case No. 11-23341). Judge Erik P. Kimball presides over the case. Brian K. Gart, Esq., Paul Steven Singerman, Esq., and Debi Evans Galler, Esq., at Berger Singerman, P.A., represent the Debtor. The Debtor selected Bryan Cave LLP as special counsel; Sonenshine Partners LLC, investment banker; Development Specialist Inc., restructuring advisor; and AlixPartners LLC, as communications consultant. Trustee Services, Inc., is the notice, claims and balloting claims agent. The Debtor estimated both assets and debts between $50 million and $100 million as of the Chapter 11 filing. HEARUSA INC: Seeks Appointment of Consumer Privacy Ombudsman ------------------------------------------------------------ HearUSA Inc. asks the Bankruptcy Court to direct the United States Trustee to appoint a consumer privacy ombudsman in its Chapter 11 case. The Debtor made the request in connection with the planned sale of substantially all of its assets. The Debtor and its subsidiary, Auxiliary Health Benefits Corporation, dba National Ear Care Plan, entered into an asset purchase agreement dated May 16, 2011, to sell the business to William Demant Holdings A/S. The assets include personally identifiable consumer information of customers who are subject to the Debtor's privacy policy, necessitating the appointment of a consumer privacy ombudsman under 11 U.S.C. Sec. 332. About HearUSA HearUSA, Inc., which sells hearing aids in 10 states, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 11-23341) on May 16, 2011, to sell the business for $80 million to William Demant Holdings A/S. The Debtor said that assets are $65.6 million against debt of $64.7 million as of March 31, 2010. Judge Erik P. Kimball presides over the case. Brian K. Gart, Esq., Paul Steven Singerman, Esq., and Debi Evans Galler, Esq., at Berger Singerman, P.A., represent the Debtor. The Debtor selected Bryan Cave LLP as special counsel; Sonenshine Partners LLC, investment banker; Development Specialist Inc., restructuring advisor; and AlixPartners LLC, as communications consultant. Trustee Services, Inc., serves as claims and notice agent. HEARUSA INC: Patient Care Ombudsman Not Necessary for Now --------------------------------------------------------- At the behest of HearUSA Inc., Bankruptcy Court Erik B. Kimball held that there is no need for the appointment of a patient care ombudsman as contemplated by Sec. 333(a)(1) of the Bankruptcy Code. The Debtor said there's no basis for the appointment of a patient care ombudsman as it is not a "healthcare business". Judge Kimball, however, held that his decision doesn't include a finding as to whether the Debtor is a "healthcare business" as defined under Sec. 101(27A) of the Bankruptcy Code. Judge Kimball also noted that the Court's determination concerning whether the appointment of a patient care ombudsman to monitor the quality of patient care and to represent the interest of the Debtor's patients, is necessary for the patients' protection under the specific facts of the Debtor's case, will be continued until the time when any circumstance arises which could involve the interests of the Debtor's patients and there may be a basis for the appointment of a patient care ombudsman. About HearUSA HearUSA, Inc., which sells hearing aids in 10 states, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 11-23341) on May 16, 2011, to sell the business for $80 million to William Demant Holdings A/S. The Debtor said that assets are $65.6 million against debt of $64.7 million as of March 31, 2010. Judge Erik P. Kimball presides over the case. Brian K. Gart, Esq., Paul Steven Singerman, Esq., and Debi Evans Galler, Esq., at Berger Singerman, P.A., represent the Debtor. The Debtor selected Bryan Cave LLP as special counsel; Sonenshine Partners LLC, investment banker; Development Specialist Inc., restructuring advisor; and AlixPartners LLC, as communications consultant. Trustee Services, Inc., serves as claims and notice agent. HEARUSA INC: Sec. 341 Creditors' Meeting Set for June 17 -------------------------------------------------------- The United States Trustee for the Southern District of Florida will convene a meeting of creditors in the bankruptcy case of HearUSA Inc. on June 17, 2011, at 11:30 a.m. at 1515 N Flagler Dr Room 870, West Palm Beach. Proofs of Claim are due by Sept. 15, 2011. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in the Debtors' bankruptcy cases. Attendance by the Debtors' creditors at the meeting is welcome, but not required. The Section 341(a) meeting offers the creditors a one-time opportunity to examine the Debtor's representative under oath about the Debtor's financial affairs and operations that would be of interest to the general body of creditors. About HearUSA HearUSA, Inc., which sells hearing aids in 10 states, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 11-23341) on May 16, 2011, to sell the business for $80 million to William Demant Holdings A/S. The Debtor said that assets are $65.6 million against debt of $64.7 million as of March 31, 2010. Judge Erik P. Kimball presides over the case. Brian K. Gart, Esq., Paul Steven Singerman, Esq., and Debi Evans Galler, Esq., at Berger Singerman, P.A., represent the Debtor. The Debtor selected Bryan Cave LLP as special counsel; Sonenshine Partners LLC, investment banker; Development Specialist Inc., restructuring advisor; and AlixPartners LLC, as communications consultant. Trustee Services, Inc., serves as claims and notice agent. HEARUSA INC: Gets Incompliance Notice From NYSE Amex ---------------------------------------------------- HearUSA, Inc. received a written notice from NYSE Amex LLC indicating that the Company no longer complies with the Exchange's continued listing standards as a result of the Company's filing of a voluntary petition under Chapter 11 of the US Bankruptcy Code and that its securities are therefore subject to being delisted from the Exchange. The Exchange stated its intention to file a delisting application with the Securities and Exchange Commission and to truncate the procedures regarding continued listing evaluation and follow-up as specified in the rules of the Exchange. The Exchange notice states that the Staff of the Exchange intends to initiate immediate delisting proceedings. In particular, the written notice from the Exchange stated that (i) as a result of the Chapter 11 filing, the Staff has determined that the Company is financially impaired and, as such, is not in compliance with Section 1003(a)(iv) of the NYSE Amex Company Guide; and (ii) the Company is not in compliance with Section 134 and Section 1101 of the Company Guide because the Company failed to timely file its Quarterly Report on Form 10-Q for the fiscal quarter ended March 26, 2011. The Company's first fiscal quarter actually ended on April 2, 2011 and the Company was not delinquent in filing its Form 10-Q at the time of the notice from the Exchange. The Company does not intend to appeal the Exchange's determination to delist the Company's common stock. After the Company's common stock is delisted, the Company cannot predict whether any trading market, including any over-the-counter trading market, for the Company's common stock will develop or be sustained. About HearUSA HearUSA, Inc., which sells hearing aids in 10 states, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 11-23341) on May 16, 2011, to sell the business for $80 million to William Demant Holdings A/S. The Debtor said that assets are $65.6 million against debt of $64.7 million as of March 31, 2010. Judge Erik P. Kimball presides over the case. Brian K. Gart, Esq., Paul Steven Singerman, Esq., and Debi Evans Galler, Esq., at Berger Singerman, P.A., represent the Debtor. The Debtor selected Bryan Cave LLP as special counsel; Sonenshine Partners LLC, investment banker; Development Specialist Inc., restructuring advisor; and AlixPartners LLC, as communications consultant. Trustee Services, Inc., serves as claims and notice agent. HEREFORD BIOFUELS: Dist. Court Rules on Suit v. Greenstone ---------------------------------------------------------- In Daniel J. Sherman, in his capacity as Chapter 7 Trustee, and on behalf of the Estate of Hereford Biofuels, L.P., v. Greenstone Farm Credit Services, ACA, et al., Civil Action No. 3:11-CV-0710-N (N.D. Tex.), District Judge David C. Godbey granted summary judgment granted entirely in favor of the Defendant, specifically: (a) that it was acting within the scope of its contractual rights when it refused to advance loan proceeds to Panda-Hereford pursuant to a September 4, 2008 Draw Request and a November 21, 2008 Draw Request, which were made at a time when Panda-Hereford could not satisfy the contractual conditions that were required to be met in order to receive a disbursement of loan proceeds; (b) that a September 5, 2008 Waiver and an October 6, 2008, as to Panda-Hereford's defaults, were not enforceable as to Defendant because the Waivers were not mere waivers of default but also contemplated interest rate increases and any agreement that contemplated interest rate changes needed full-Lender consent (which the Defendant never gave); and (c) that Greenstone should have an allowed, unsecured claim in the bankruptcy case for its reasonable and necessary attorneys' fees and expenses in the amount of $161,743.50 in having to litigate these matters. The adversary proceeding involves an allegation by the borrower that one of its prospective lenders, who was party to a multi- lender financing agreement, committed breach of contract by failing to fund said lender's pro rata share of certain borrowing requests made by the borrower. The Action was initially commenced in state court in Dallas, Texas, but was removed to the bankruptcy court in Dallas, when the original plaintiff and borrower, Panda Hereford Ethanol, L.P., filed for bankruptcy in Dallas. Panda- Hereford resorted to filing bankruptcy when it did not have the necessary funds to finish construction on what was intended to be a state-of-the art, manure-fueled ethanol plant in Hereford, Texas. According to pleadings filed in Panda-Hereford's bankruptcy case, $225 million had been invested in the ethanol plant at the time of the filing of the bankruptcy case ($80 million of which was equity). A copy of the District Court's May 24, 2011 Order is available at http://is.gd/pPSjpAfrom Leagle.com. About Hereford Biofuels Hereford Biofuels and three of its debtor-affiliates filed separate petitions for Chapter 11 relief of January 23, 2009 (Bankr. N.D. Tex. Lead Case No. 09-30453). Dan B. Prieto, Esq., Gregory M. Gordon, Esq., and Robert J. Jud, Esq., at Jones Day, represent the Debtors as counsel. Joseph M. Coleman, Esq., and Joseph A. Friedman, Esq., at Kane, Russell, Coleman & Logan, represent the official committee of unsecured creditors as counsel. When the Debtor filed for protection from its creditors, it listed between $50 million and $100 million in assets and between $100 million and $500 million in debts. On June 11, 2009, the Debtors consummated the sale of their ethanol plant in Hereford, Texas, to Ethanol Acquisition, LLC, and substantially all of their assets other than the proceeds of certain assets pursuant to a settlement agreement with the official committee of unsecured creditors and Societe Generale, as agent for the prepetition lenders, were transferred to the purchaser. The members of the purchaser are the Debtors' senior secured lenders, Societe Generale as administrative Agent, disbursement agent, collateral agent and LC Fronting Bank, and SG Americas Securities, LLC, as lead arranger under that Financing Agreement dated as of July 28, 2006. The purchaser offered to pay (i) a principal amount of the obligations equal to $25,000,000; and (ii) the assumption of the assumed liabilities. On Sept. 22, 2009, the bankruptcy case was converted to Chapter 7, and Daniel J. Sherman was appointed as the chapter 7 trustee. HSRE-CDS I: Gets 2nd Interim OK to Use KeyBank's Cash Collateral ---------------------------------------------------------------- The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware, in a second interim order, authorized HSRE- CDS I, LLC to use the cash collateral. As reported in the Troubled Company Reporter on April 14, 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. 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. Subject to carve out, the use of the cash collateral will terminate effective the fifth business day after entry of an order disposing of the motion to dismiss. If necessary upon final disposition of the motion to dismiss, the Court will schedule a final hearing on the Debtor's request to access the 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 disclosed assets amounting to $1,256,241 plus unknown and liabilities of $22,878,499 as of the Chapter 11 filing. HSRE-CDS I: Taps BBK, Ltd. to Assist in Financing Transactions -------------------------------------------------------------- HSRE-CDS I, LLC, asks the U.S. Bankruptcy Court for the District of Delaware for authority to employ BBK, Ltd. as financial advisor. BBK, Ltd. will, among other things: -- assist the Debtor in restructuring of its debt; -- identify the qualified participants for a financing transaction; and -- assist the Debtor in negotiations with the secured lender. The hourly rates of BBK, Ltd.'s personnel are: Managing Directors $500 Senior Directors $425 Directors $375 Manager $320 Associates $250 Analysts $195 Praprofessional staff $95 As of the Petition Date, BBK, Ltd. received $46,968 as payment for prepetition services rendered. BBK, Ltd., does not hold a prepetition claim against the Debtor. To the best of the Debtor's knowledge, BBK, Ltd., is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The Debtor set a June 3 hearing on the requested employment of BBK, Ltd. as financial advisor. 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. It is a partnership between campus-housing operator Collegiate Management Group and private equity firm Harrison Street Real Estate Capital LLC. HSRE-CDS I filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-10972) on March 31, 2011. 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 disclosed assets of 1,256,241 plus unknown and liabilities of $22,878,499 as of the Chapter 11 filing. Roberta A. DeAngelis, the U.S. Trustee for Region 3, was unable to appoint an official committee of unsecured creditors in the Debtor's case. HYMAN COS: Dist. Ct. Rejects Kieselstein's Indemnification Claims ----------------------------------------------------------------- District Judge Denise Cote ruled that Kieselstein Enterprises, Inc., and its owner, Barry Cord, are not entitled to indemnification or contribution from The Hyman Companies, Inc. and Nat Hyman in the event that Kieselstein is found liable to Iva P. Speyer. Ms. Speyer has sued Kieselstein, a jewelry designer and manufacturer, for employment discrimination. Judge Cote ruled that the express terms of the Bankruptcy Court's Confirmation Order permanently enjoin any action by Kieselstein against Hyman Co. Kieselstein also has not identified any duty owed by Nat Hyman to Ms. Speyer; indeed, its argument concerning indemnification is based solely on the relationship between Kieselstein and Hyman Co., without mention of Nat Hyman's role. Judge Cote dismissed Kieselstein's third-party complaint against Hyman Co. The case before the District Court is, IVA P. SPEYER, Plaintiff, v. KAREN KIESELSTEIN-CORD, KAREN CORD, BARRY KIESELSTEIN-CORD, BARRY CORD, KIESELSTEIN CORD IMPERIAL, LLC, KIESELSTEIN CORD RETAIL, INC., FRANKLIN BONILLA, and KIESELSTEIN ENTERPRISES, INC., Defendants; and BARRY CORD and KIESELSTEIN ENTERPRISES, INC., Third-Party Plaintiffs, v. NATHANIEL L. HYMAN and THE HYMAN COMPANIES, INC., Third-Party Defendants, No. 09 Civ. 3032 (S.D.N.Y.). A copy of Judge Cote's May 24, 2011 Opinion & Order is available at http://is.gd/AgDyYRfrom Leagle.com. About Hyman Cos. Allentown, Pennsylvania-based The Hyman Companies, Inc. -- aka Landau, The Landau Collection, Boccelli, Landau Costume Jewelry, and Bijou Bijou -- filed for Chapter 11 bankruptcy protection on March 3, 2009 (Bankr. E.D. Pa. Case No. 09-20523). Edmond M. George, Esq., at Obermayer Rebmann Maxwell & Hippel, LLP, assists the Company in its restructuring efforts. The Company listed $1 million to $10 million in both assets and debts. INDIANAPOLIS DOWNS: Dismissal of Power Plant Lawsuit Sought ----------------------------------------------------------- The parties to the complaint, Power Plant Entertainment Casino Resort Indiana, LLC, et al., v. Ross J. Mangano, et al., Adv. Proc. No. 11-00336 (Bankr. D. Md.), stipulate to give the Plaintiffs' additional time to respond to certain defendants' motions to dismiss the lawsuit. On April 29, 2011, Defendants The J. Oliver Cunningham Trust dated February 26, 1971, The Anne C. McClure Trust dated February 26, 1971, The Jane C. Warriner Trust dated February 26, 1971 -- Trust Defendants -- and Ross J. Mangano removed certain claims and causes of action asserted in a state court proceeding captioned Power Plant Entertainment Casino Resort Indiana, LLC, et al. v. Ross J. Mangano, et al., No. 24C11001014 (Md. Cir. Ct., Baltimore City) to the Bankruptcy Court. On May 4 and 10, 2011, the Trust Defendants and Mr. Mangano filed motions to dismiss the Removed Claims. On May 6, 2011, Plaintiffs Power Plant Entertainment Casino Resort Indiana, LLC, PPE Casino Resorts Maryland, LLC, and The Cordish Company filed a Motion for Abstention and Remand regarding the Removed Claims. A copy of the parties' stipulation, as approved by Bankruptcy Judge Nancy V. Alquist on May 13, 2011, is available at http://is.gd/N7gdHzfrom Leagle.com. The Plaintiffs are represented by: Robert J. Weltchek, Esq. WELTCHEK MALLAHAN & WELTCHEK Lutherville, MD Tel: 410-825-5287 Fax: 410-825-5277 E-mail: rweltchek@wmwlawfirm.com The Removing Defendants are represented by: Steven F. Barley, Esq. Scott R. Haiber, Esq. Andrea W. Trento, Esq. HOGAN LOVELLS US LLP Baltimore, Maryland Tel: (410) 659-2700 Fax: (410) 659-2701 E-mail: andrea.trento@hoganlovells.com 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. In July 2001, Indianapolis Downs was granted a permit to conduct a horse track operation in Shelvyville, Indiana, 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 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. Epiq Bankruptcy Solutions is the claims and notice agent. INNOLOG HOLDINGS: Incurs $654,600 First Quarter Net Loss -------------------------------------------------------- Innolog Holdings Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $654,574 on $1.30 million of revenue for the three months ended March 31, 2011, compared with a net loss of $700,061 on $1.71 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $791,341 in total assets, $9.68 million in total liabilities, all current, and a $8.89 million total stockholders' deficiency. A full-text copy of the Form 10-Q is available for free at: http://is.gd/qPpkVp About Innolog Holdings Fairfax, Virginia-based Innolog Holdings Corporation is a holding company designed to make acquisitions of companies in the government services industry. The Company's first acquisition, Innovative Logistics Techniques, Inc., is a solutions oriented provider of logistics services primarily to agencies of the U.S. government, but also to state and local agencies and to private businesses. As reported by the TCR on May 26, 2011, Spector & Associates, LLP, inPasadena, California, expressed substantial doubt about the Company's ability to continue as a going concern. The Company reported a net loss of $5.79 million on $5.81 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $2.81 million on $5.93 million of revenue for the period from March 23, 2009, through Dec. 31, 2009. INTERNATIONAL BARRIER: Reports $11,100 Net Income in March 31 Qtr. ------------------------------------------------------------------ International Barrier Technology Inc. filed its quarterly report on Form 10-Q, reporting net income of $11,126 on $734,503 of sales for the three months ended March 31, 2011, compared with a net loss of $1.9 million on $659,585 of sales for the three months ended March 31, 2010. For the nine months ending March 31, 2011, the net income is $865,317 versus a net loss of $2.2 million in the prior year. Year-to-date sales increased 23% to $2.5 million versus $2.0 million in the prior year. The Company's balance sheet as of March 31, 2011, showed $4.2 million in total assets, $2.1 million in total liabilities, and stockholders' equity of $2.1 million. "At March 31, 2011, the Company had an accumulated deficit of $14.4 million (June 30, 2010 - $15.3 million) since its inception and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company's ability to continue as a going concern," the Company said in the filing. A copy of the Form 10-Q is available at http://is.gd/swePlG Watkins, Minnesota-based International Barrier Technology Inc. develops, manufactures and markets proprietary fire resistant building materials branded as Blazeguard in the United States of America and, as well, the Company owns the exclusive U.S. and international rights to the Pyrotite(R) fire retardant technology. IRON MOUNTAIN: S&P Affirms CCR at 'BB-'; Outlook Negative --------------------------------------------------------- Standard & Poor's Ratings Services affirmed all of its ratings on Boston-based information storage company Iron Mountain Inc., including the 'BB-' corporate credit rating. "At the same time, we removed all ratings from CreditWatch, where they were placed with negative implications on April 19, 2011. The rating outlook is stable," S&P related. "In addition, we assigned our 'BB+' rating to Iron Mountain Inc.'s operating subsidiaries' (Iron Mountain Information Management Inc., Iron Mountain Canada Corporation, and Iron Mountain Switzerland GmbH) proposed $1.35 billion senior secured facilities. These facilities consist of a $750 million revolving credit facility and a $600 million term loan A. The recovery rating on this debt is '1', indicating our expectation of very high (90% to 100%) recovery for lenders in the event of a payment default. Proceeds of the new facilities are expected to be used to refinance the existing credit facilities and to fund share repurchases," S&P continued. "The 'BB-' rating on Iron Mountain reflects our expectation that leverage will remain below our 5.5x fully-adjusted target for the rating, despite management's intention to return $2.2 billion to shareholders by 2013 year-end," said Standard & Poor's credit analyst Tulip Lim. "We view the company's financial risk profile as aggressive, a function of the company's relatively capital- intensive nature and its increased shareholder return orientation." The outlook is negative, reflecting Standard & Poor's view that management could adopt an even more aggressive financial policy, potentially increasing shareholder pressure. IVOICE, INC: Incurs $308,500 Net Loss in 1st Quarter ---------------------------------------------------- Ivoice, Inc., filed with the U.S. Securities and Exchange Commission its Quarterly Report on Form 10-Q reporting a net loss of $308,529 on $41,621 of sales for the three months ended March 31, 2011, compared with a net loss of $93,679 on $42,400 of sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.55 million in total assets, $3.60 million in total liabilities, and a $2.05 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/CxenhA About iVoice Matawan, N.J.-based iVoice, Inc. -- http://www.ivoice.com/-- is focused on the development and licensing of its proprietary technologies. To date the Company has filed fifteen (15) patent applications with the United States Patent and Trademark Office for speech enabled applications that the Company has developed internally. Of the patent applications the Company has filed, four (4) patents have been awarded. As reported by the TCR on April 25, 2011, Rosenberg Rich Baker Berman & Co, in Somerset, New Jersey, expressed substantial doubt about iVoice, Inc.'s ability to continue as a going concern. The independent auditors noted that the Company has incurred substantial accumulated deficits. The Company reported a net loss of $1.5 million on $177,198 of sales for 2010, compared with net income of $219,780 on $108,120 of sales for 2009. J&K WRIGHT: Court Confirms Second Amended Plan ---------------------------------------------- Chief Bankruptcy Judge William T. Thurman confirmed the Second Amended Joint Plan of Reorganization Dated May 11, 2011, filed by J&K Wright Family Limited Partnership; Carlton Hotel LLC; and Cedar City Inn LLC, finding that the Debtors have met the burden of proving the elements of Sections 1129(a) and (b) of the Bankruptcy Code by a preponderance of evidence. The Plan designates five Classes of Claims or Equity Interests. No objections to confirmation of the Plan were filed. A copy of the Bankruptcy Court's May 24, 2011 FINDINGS OF FACT AND CONCLUSIONS OF LAW IN SUPPORT OF ORDER CONFIRMING DEBTORS' SECOND AMENDED JOINT PLAN OF REORGANIZATION DATED MAY 11, 2011, is available at http://is.gd/TfxCQKfrom Leagle.com. J&K Wright Family Limited Partnership; Carlton Hotel LLC; and Cedar City Inn LLC, filed separate Chapter 11 bankruptcy petitions (Bankr. D. Utah Case Nos. 10-36784, 10-36787, and 10-36790) on Dec. 3, 2010, represented by: Danny C. Kelly, Esq. Bentley R. Peay, Esq. STOEL RIVES LLP 201 South Main Street, Suite 1100 Salt Lake City, UT 84111 Telephone: (801) 578-6979 Facsimile: (801) 578-6999 E-mail: dckelly@stoel.com brpeay@stoel.com J&K Wright Family Limited Partnership and Cedar City Inn LLC each listed $1 million to $10 million in assets and debts. Carlton Hotel listed $1 million to $10 million in assets and under $50,000 in debts. JACKSON HEWITT: Hires Alvarez & Marsal as Fin'l Advisors -------------------------------------------------------- Jackson Hewitt Tax Service Inc. and its debtor-affiliates seek Bankruptcy Court permission to employ Alvarez & Marsal North America, LLC, as financial advisors. The Debtors said A&M is familiar with their businesses, financial affairs, and capital structure. Since A&M's engagement commenced on March 31, 2011, the A&M professionals providing services to the Debtors have worked closely with the Debtors' management and other professionals in assisting with the myriad requirements of the chapter 11 cases. Consequently, the Debtors believe that A&M has developed significant relevant experience and expertise regarding the Debtors and the unique circumstances of their cases. Dennis Stogsdill, a Managing Director at A&M, will be the project leader for the services provided by A&M in the Debtors' chapter 11 cases. Mr. Stogsdill attests that (a) A&M is a "disinterested person" within the meaning of Bankruptcy Code section 101(14), as modified by section 1107(b), and holds no interest adverse to the Debtors or their estates in connection with the matters for which A&M is to be retained by the Debtors, as required by section 327(a), and (b) A&M has no connection with the Debtors, their creditors, the U.S. Trustee, or other parties in interest in these chapter 11 cases. A&M will be paid a fixed fee by the Debtors of $25,000 per week for the services of Richard Mizak, a Senior Director at A&M, on a full-time basis. Additional personnel will only be utilized upon authorization from the Debtors. In accordance with the terms of the Engagement Letter, A&M will be compensated for the services of Mr. Stogsdill and such additional personnel at A&M's customary hourly rates: Managing Director $650-850 Director $450-650 Associate $300-450 Analyst $175-300 With respect to the services A&M will provide to the Debtors in assisting in the development of a creditor matrix and unsecured claims analysis and preparation of schedules of financial affairs and schedules of assets and liabilities, the Debtors will pay A&M a one-time fee of $30,000. A&M will be reimbursed for the reasonable out-of-pocket expenses. The parties also agreed to indemnification provisions. On April 5, 2011, A&M received $50,000 as a retainer in connection with preparing for and conducting the filing of the chapter 11 cases. In the 90 days prior to the Petition Date, A&M received payments totaling $215,389.93 in the aggregate for services performed for the Debtors. A&M has applied these funds to amounts due for services rendered and expenses incurred prior to the Petition Date. The unapplied residual retainer, which is estimated to total approximately $25,000, will not be segregated by A&M in a separate account, and will be held until the end of the chapter 11 cases and applied to A&M's finally approved fees in these proceedings. About Jackson Hewitt Tax Service Parsippany, New York-based Jackson Hewitt Tax Service Inc., aka JHTS Inc., provides computerized preparation services for federal, state and local individual income tax returns in the United States through a nationwide network of franchised and company-owned offices operating under the brand name Jackson Hewitt Tax Service. The Company has 700 franchisees who collectively operated a total of 4,846 offices. The Company also operates 1,110 company-owned offices. Jackson Hewitt and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-11587) on May 24, 2011. Judge Mary F. Walrath presides over the case. Skadden, Arps, Slate, Meagher & Flom LLP, serves as the Debtors' bankruptcy counsel. Alvarez & Marsal North America, LLC, serves as their financial advisor. Moelis & Company LLC acts as investment banker. The Garden City Group, Inc., serves as the Debtors' Claims and Noticing Agent. The Debtors also retained Deloitte & Touche to serve as tax advisors and Kekst & Company to serve as communications advisors. The Debtors filed a Joint Prepackaged Plan of Reorganization and Disclosure Statement together with their petitions. Under the terms of the Plan, Jackson Hewitt's current secured lenders will receive their pro rata share of a new $100 million term loan and all of the equity in the reorganized enterprise. The Company also anticipates entering into a new $115 million revolving credit facility upon consummation of the Plan. It is anticipated that upon consummation of the proposed Plan, Jackson Hewitt's new equity will be privately held. All of the Company's existing common stock will be cancelled upon Jackson Hewitt's emergence from bankruptcy. On May 23, 2011, the Debtors commenced solicitation of votes on the Plan from the lenders. No other classes of creditors or stockholders were solicited, as each such class is either being paid in full or receiving no recovery and hence, is deemed either to accept or reject the Plan, respectively. The Debtors received overwhelming acceptances to the Plan from the lenders. Mark McDermott, Esq., at Skadden Arps, told the Bankruptcy Court at a May 25 hearing that investor and financier Bayside Capital is in line to be "a significant majority" owner of Jackson Hewitt. Bayside Capital has $4.5 billion under management. Bayside is the largest of 10 secured lenders that Jackson Hewitt owes a total of $357 million. Mr. McDermott also told the Court that Jackson Hewitt, worth an estimated $225 million, does not have sufficient value to cover the secured debt. The Court set a July 8 court date to consider confirmation of Jackson Hewitt's Chapter 11 plan. Wells Fargo Bank, N.A., the Administrative Agent to the prepetition lenders, is represented by Reed Smith. Bayside Capital Inc. is represented by Milbank Tweed Hadley & McCloy LLP. JACKSON HEWITT: Moelis on Board as Investment Banker ---------------------------------------------------- Jackson Hewitt Tax Service Inc. and its debtor-affiliates ask the Bankruptcy Court to approve their employment of Moelis & Company LLC as investment banker. Among others, Moelis will assist the Debtors in identifying, soliciting, evaluating and negotiating any restructuring transaction, sale transaction, equity transaction or debt transaction initiated by the Debtors or by a third party. In March 2010, the Debtors retained Moelis to, among other things, (a) assist with their efforts to find a replacement refund anticipation loan financing commitment in time for the 2011 tax season, and (b) explore more comprehensive solutions to restructure their secured debt. Since the commencement of its engagement, Moelis has familiarized itself with the Debtors' business and operations by reviewing the Debtors' financial condition and outlook, analyzing the Debtors' financial liquidity and assisting in the development of financial data and presentations to the Debtors' senior management, board of directors and creditors. Moelis has also provided strategic advice relative to potential restructuring alternatives, including extensive participation in negotiations and discussions with certain creditor constituencies. The Debtors propose to pay Moelis according to this Fee Structure: (a) Monthly Fee A monthly cash fee equal to $150,000, payable in advance on the 3rd day of every month regardless of whether or not a Transaction has taken place or will take place. (b) Restructuring Fee A cash fee equal to $2 million, payable upon consummation of a Restructuring Transaction. 50% of the Restructuring Fee was paid prior to the Petition Date. 50% of all Monthly Fees paid since Sept. 3, 2010, will be credited towards the Restructuring Fee. (c) Sale Transaction Fee A cash fee equal to the greater of $3 million or 1% of the Transaction Value to be paid upon closing of a Sale Transaction. (d) Equity Transaction Fee A cash fee equal to 4% of the aggregate face value of new capital raised in an Equity Transaction that does not constitute a Sale Transaction, payable upon closing of the corresponding Equity Transaction. (e) Debt Transaction Fee A cash fee equal to 1.00% of the aggregate face amount of any new debt raised in a Debt Transaction, up to $500 million, plus 0.5% of the aggregate face amount of any new debt above $500 million, payable immediately upon the closing of the Debt Transaction. (f) RAL Transaction Fee A cash fee equal to 0.25% of either (a) the difference between the 2011 RAL Commitment and the amount of the Base Level RAL Program, if Republic Bank and/or River City Bank provides a commitment to the Debtors for a refund anticipation loan program for 2011, or (b) the aggregate face amount of a similar commitment, if provided by certain other financial institutions. In either case, the fee is payable immediately upon closing of the commitment. The sum of all the fees in aggregate shall not exceed $5 million provided, however, any RAL Transaction Fee will not be included or subject to the cap. In the event the Sale Transaction Fee is paid, Moelis will not be entitled to receive the Restructuring Fee or the Equity Transaction Fee. Conversely, in the event the Restructuring Fee or the Equity Transaction Fee is paid, Moelis will not be entitled to receive the Sale Transaction Fee. Furthermore, 50% of any fees outstanding (excluding Monthly Fees) earned in connection with a Transaction consummated in connection with a prepackaged or pre-negotiated bankruptcy plan, after giving effect to any crediting, will be earned and paid prior to the commencement of the case and the other 50% will be earned and paid upon consummation of such plan; however, if the plan is denied confirmation, any fees already earned and paid in connection therewith (excluding Monthly Fees) will be refunded to the Debtors. In addition to any fees payable to Moelis under the Fee Structure, Moelis will charge the Debtors for all reasonable out-of-pocket expenses incurred in connection with the engagement. The parties also agree to indemnification provisions. During the 90-day period preceding the Petition Date, the Debtors made aggregate fee payments to Moelis of $1,587,500 and aggregate expense reimbursements to Moelis of $21,656.43 as follows: $308,752.14 on March 15, $151,330.45 on April 5, $153,336.61 on May 6, and $995,737.23 on May 23 Steven Panagos, Managing Director and Vice Chairman, Restructuring and Recapitalization of Moelis & Company LLC, attests that (a) Moelis is a "disinterested person" within the meaning of Bankruptcy Code section 101(14), as modified by section 1107(b), and holds no interest adverse to the Debtors or their estates in connection with the matters for which Moelis is to be retained by the Debtors, as required by section 327(a), and (b) Moelis has no connection with the Debtors, their creditors, the U.S. Trustee, or other parties in interest in these chapter 11 cases. Mr. Panagos may be reached at: Steven Panagos Managing Director and Vice Chairman, Restructuring and Recapitalization MOELIS & COMPANY LLC 399 Park Avenue, Fifth Floor New York, NY 10022 Telephone: (212) 883-3800 Facsimile: (212) 880-4260 E-Mail: Steve.Panagos@moelis.com About Jackson Hewitt Tax Service Parsippany, New York-based Jackson Hewitt Tax Service Inc., aka JHTS Inc., provides computerized preparation services for federal, state and local individual income tax returns in the United States through a nationwide network of franchised and company-owned offices operating under the brand name Jackson Hewitt Tax Service. The Company has 700 franchisees who collectively operated a total of 4,846 offices. The Company also operates 1,110 company-owned offices. Jackson Hewitt and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-11587) on May 24, 2011. Judge Mary F. Walrath presides over the case. Skadden, Arps, Slate, Meagher & Flom LLP, serves as the Debtors' bankruptcy counsel. Alvarez & Marsal North America, LLC, serves as their financial advisor. Moelis & Company LLC acts as investment banker. The Garden City Group, Inc., serves as the Debtors' Claims and Noticing Agent. The Debtors also retained Deloitte & Touche to serve as tax advisors and Kekst & Company to serve as communications advisors. The Debtors filed a Joint Prepackaged Plan of Reorganization and Disclosure Statement together with their petitions. Under the terms of the Plan, Jackson Hewitt's current secured lenders will receive their pro rata share of a new $100 million term loan and all of the equity in the reorganized enterprise. The Company also anticipates entering into a new $115 million revolving credit facility upon consummation of the Plan. It is anticipated that upon consummation of the proposed Plan, Jackson Hewitt's new equity will be privately held. All of the Company's existing common stock will be cancelled upon Jackson Hewitt's emergence from bankruptcy. On May 23, 2011, the Debtors commenced solicitation of votes on the Plan from the lenders. No other classes of creditors or stockholders were solicited, as each such class is either being paid in full or receiving no recovery and hence, is deemed either to accept or reject the Plan, respectively. The Debtors received overwhelming acceptances to the Plan from the lenders. Mark McDermott, Esq., at Skadden Arps, told the Bankruptcy Court at a May 25 hearing that investor and financier Bayside Capital is in line to be "a significant majority" owner of Jackson Hewitt. Bayside Capital has $4.5 billion under management. Bayside is the largest of 10 secured lenders that Jackson Hewitt owes a total of $357 million. Mr. McDermott also told the Court that Jackson Hewitt, worth an estimated $225 million, does not have sufficient value to cover the secured debt. The Court set a July 8 court date to consider confirmation of Jackson Hewitt's Chapter 11 plan. Wells Fargo Bank, N.A., the Administrative Agent to the prepetition lenders, is represented by Reed Smith. Bayside Capital Inc. is represented by Milbank Tweed Hadley & McCloy LLP. JACKSON HEWITT: Withdraws Listing of Common Stock from Exchange --------------------------------------------------------------- On May 26, 2011, The New York Stock Exchange LLC filed on SEC Form 25, a notification of removal from listing and/or registration of the common stock of Jackson Hewitt Tax Service Inc. from the Exchange, pursuant to 17 CFR 240.12d2-2(b). A security is considered to be delisted 10 days after the filing of the Form 25 with the SEC. A copy of the SEC Form 25 is available at http://is.gd/zvrNeP About Jackson Hewitt Tax Service Parsippany, New York-based Jackson Hewitt Tax Service Inc., aka JHTS Inc., provides computerized preparation services for federal, state and local individual income tax returns in the United States through a nationwide network of franchised and company-owned offices operating under the brand name Jackson Hewitt Tax Service. The Company has 700 franchisees who collectively operated a total of 4,846 offices. The Company also operates 1,110 company-owned offices. Jackson Hewitt and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 11-11587) on May 24, 2011. Judge Mary F. Walrath presides over the case. Skadden, Arps, Slate, Meagher & Flom LLP, serves as the Debtors' bankruptcy counsel. Alvarez & Marsal North America, LLC, serves as their financial advisor. Moelis & Company LLC acts as investment banker. The Garden City Group, Inc., serves as the Debtors' Claims and Noticing Agent. The Debtors also retained Deloitte & Touche to serve as tax advisors and Kekst & Company to serve as communications advisors. The Debtors filed a Joint Prepackaged Plan of Reorganization and Disclosure Statement together with their petitions. Under the terms of the Plan, Jackson Hewitt's current secured lenders will receive their pro rata share of a new $100 million term loan and all of the equity in the reorganized enterprise. The Company also anticipates entering into a new $115 million revolving credit facility upon consummation of the Plan. It is anticipated that upon consummation of the proposed Plan, Jackson Hewitt's new equity will be privately held. All of the Company's existing common stock will be cancelled upon Jackson Hewitt's emergence from bankruptcy. On May 23, 2011, the Debtors commenced solicitation of votes on the Plan from the lenders. No other classes of creditors or stockholders were solicited, as each such class is either being paid in full or receiving no recovery and hence, is deemed either to accept or reject the Plan, respectively. The Debtors received overwhelming acceptances to the Plan from the lenders. Mark McDermott, Esq., at Skadden Arps, told the Bankruptcy Court at a May 25 hearing that investor and financier Bayside Capital is in line to be "a significant majority" owner of Jackson Hewitt. Bayside Capital has $4.5 billion under management. Bayside is the largest of 10 secured lenders that Jackson Hewitt owes a total of $357 million. Mr. McDermott also told the Court that Jackson Hewitt, worth an estimated $225 million, does not have sufficient value to cover the secured debt. The Court set a July 8 court date to consider confirmation of Jackson Hewitt's Chapter 11 plan. JOHN CLEMENTE: Ex-Wife Loses Bid to Collect Counsel Fees -------------------------------------------------------- On May 26, 2010, Bankruptcy Judge Michael B. Kaplan denied a request by Linda Clemente to declare that counsel fees she incurred in connection with her ex-husband's bankruptcy proceedings were non-dischargeable under 11 U.S.C. Sections 523(a)(5) and (a)(15). The Plaintiff appealed the decision. In a May 23, 2011 Opinion, District Judge Joel A. Pisano affirmed. "[I]t appears that the Bankruptcy Court could have found that the Defendant engaged in sufficiently vexatious or bad faith conduct to warrant the award of attorney's fees incurred in the bankruptcy proceedings pursuant to 11 U.S.C. Sec. 105(a). Although the fact findings . . . seem to lead to the opposite conclusion, the Bankruptcy Court was in the best position to reach its conclusion and [the District] Court is loathe to substitute its judgment. Because the Bankruptcy Court took into account and considered Defendant's conduct in both the divorce and bankruptcy proceedings and because the Bankruptcy Court is in the best position to make such a determination, the Court finds that the Bankruptcy Court's decision was not in error," Judge Pisano said. A copy of Judge Pisano's May 23, 2011 Opinion is available at http://is.gd/Qe3n1qfrom Leagle.com. Linda Clemente and her ex-spouse debtor-defendant John Clemente engaged in lengthy divorce proceedings in the Superior Court of New Jersey beginning in August of 2003. On Jan. 17, 2008, Mr. Clemente filed for Chapter 11 bankruptcy (Bankr. D. N.J. Case No. 08-10812), listing under $1 million in assets and debts. A copy of his petition is available at: http://bankrupt.com/misc/njb08-10812.pdf On April 24, 2009, Mr. Clemente moved to convert his Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. In granting the motion, the Bankruptcy Court noted his untimely and delinquent domestic support obligations. JOHN MESSINA: 7th Cir. Warns of Sanctions Over Frivolous Appeals ---------------------------------------------------------------- John Messina appeals a contempt judgment for a third time, asserting arguments that the U.S. Court of Appeals for the Seventh Circuit has rejected at least once or twice before. His arguments have not improved with the passage of time and the Seventh Circuit affirmed. The Seventh Circuit panel, consisting of Circuit Judges William J. Bauer, John L. Coffey, and Kenneth F. Ripple, said the third appeal is patently frivolous. "We rejected all of Messina's arguments at least once before, and he could not have believed in good faith that his arguments would be successful this time around," the Seventh Circuit held. The Seventh Circuit directs Mr. Messina to show cause as to why he should not pay double attorneys' fees and costs associated with the appeal, pursuant to Rule 38 of the Federal Rules of Appellate Procedure. Mr. Messina is also directed to show cause as to why he should not be suspended or disbarred pursuant to Rule 46(b) of the Federal Rules of Appellate Procedure. Given his blatant disregard of the Seventh Circuit's and the district court's warnings, contempt findings, and sanctions, the Seventh Circuit cautioned Mr. Messina that another frivolous appeal will warrant an injunction against future litigation between these parties. "Messina's litigation crusade must end; whether it ends voluntarily or by order of court is entirely within his control," the Seventh Circuit said. A copy of the Seventh Circuit's May 24, 2011 Order is available at http://is.gd/8bH31Zfrom Leagle.com. John P. Messina is a practicing Illinois attorney doing business as the Law Office of John P. Messina. On Sept. 22, 1999, he filed a Chapter 11 bankruptcy petition (Bankr. N.D. Ill. 99-29371), Judge John H. Squires presiding. On Feb. 6, 2001, the case was converted to Chapter 7 and thereafter Lawrence Fisher was appointed as the case trustee. Keevan D. Morgan, Esq., and Peter L. Berk, Esq., at Morgan & Bley, Ltd., 900 West Jackson Boulevard, Suite 4 East, Chicago, Illinois, represented the trustee. JORDAN HOSPITAL: S&P Affirms Rating on $81MM Bonds at 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook to positive from stable and affirmed its 'BB-' rating on Massachusetts Development Finance Agency's $81 million series 1992B, 1998D, and 2003E bonds issued for Jordan Hospital. "The positive outlook reflects what we consider the hospital's slim, but improved, financial cushion achieved after Jordan posted very strong earnings in 2010 and significantly improved unrestricted cash and investments," said Standard & Poor's credit analyst Cynthia Keller Macdonald. "In addition, Jordan has recently completed a management reorganization under its relatively new CEO, which we believe will likely result in continued progress, given that the hospital has historically underperformed its potential in a market with limited competition," said Ms. Keller Macdonald. The 'BB-' rating reflects Standard & Poor's view of Jordan's: * Limited record of positive operations, * Elevated debt levels, * Soft volume trends, and * Outmigration from the service area. Standard & Poor's believes a lower rating is unlikely due to Jordan's: * Growing unrestricted cash and investments, and * Strong market position with limited competition in a growing service area. Standard & Poor's could consider a higher rating if Jordan maintains cash and investments and if the hospital establishes a longer record of positive operations, although not necessarily at 2010 levels. Standard & Poor's believes a lower rating or negative outlook within the one-year time frame of this outlook is possible if Jordan's financial profile deteriorates, volumes substantially decrease, or if the hospital issues any new debt or has major capital needs because Jordan's debt levels are already high. Jordan Hospital operates a 155-bed acute-care hospital in Plymouth, Mass. JUNIPER GROUP: SEC Requires Delivery of Certain Documents --------------------------------------------------------- Juniper Group, Inc., received a subpoena issued pursuant to a formal order from the Securities and Exchange Commission on May 12, 2011. The subpoena requires the delivery of certain documents related to a matter involving a third party. The SEC states that this investigation is a non-public, fact finding inquiry and it should not be construed as an indication by the SEC that any violations of the law have occurred nor as an adverse reflection upon any person, entity or security. The Company has not been made aware of any allegations by the SEC. During the period April 1, 2011, through May 20, 2011, the Company approved the conversion of convertible securities into unrestricted shares of common stock pursuant to the provisions of Rule 144(b)(1). The Convertible Securities were originally issued under Section 4(2) of the Securities Act of 1933 as private transactions exempt from registration and in all recent conversions the provisions of Rule 144(c)(1) were met in that the Company is a reporting issuer, the recipients were non-affiliates of the Company and each had held the Convertible Securities in excess of six months. A total of 1,536,999,999 shares of unrestricted common stock were issued during the period April 1, 2011, through May 20, 2011, in exchange for the satisfaction of the conversion of $136,575 of Convertible Securities. The conversions were taken in response to the request of the holders of the Convertible Securities and upon satisfactory compliance with the provisions of Rule 144 and its provisions as set forth above. The Company relied on exemptions from registration afforded by Section 4(2) of the Securities Act of 1933 and Rule 506 of Regulation D of the General Rules and Regulations thereunder for the sale of the Convertible Notes and warrants to investors and the issue of shares upon conversion of convertible notes, debentures and preferred stock. The Company believes that it has complied with the manner of sale, access to information and investor accreditation requirements of such exemptions. The Company has 4,497,067,398 shares of Common Stock, par value $0.0001 issued and outstanding as of May 20, 2011, of which approximately 1,715,700 are held in brokers' name. About Juniper Group Boca Raton, Fla.-based Juniper Group, Inc., is a holding company. The Company was incorporated in the State of Nevada in 1997 and conducts its business through indirect wholly-owned subsidiaries. The Company's wireless infrastructure services operating subsidiaries primarily focus their activities in the Eastern and Central United States. The Company's intention is to be able to support the increased demand in the deployment of wireless infrastructure services with leading wireless telecommunication companies in providing them with maintenance and upgrading of wireless telecommunication network sites, site acquisitions, site surveys, co-location facilitation, tower construction and antenna installation to tower system integration, hardware and software installations. As reported by the TCR on April 21, 2011, Liebman Goldberg & Hymowitz, LLP, in Garden City, New York, expressed substantial doubt about the Company's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has a working capital deficiency and has suffered recurring losses from operations. KASDEN FUEL: Trustee May Hire Consultant in the Ordinary Course --------------------------------------------------------------- Bankruptcy Judge Albert S. Dabrowski denied the request of the Chapter 11 Trustee for The Kasden Fuel Company to employ Fuss & O'Neill, Inc. as Environmental Consultants pursuant to Section 363(b) of the Bankruptcy Code. However, the Court said the Chapter 11 Trustee may employ the firm in the ordinary course of business pursuant to 11 U.S.C. Section 1108. The Chapter 11 Trustee needs the firm's services to "review various records, inspect [certain Property] and perform certain testing to report to the Trustee what, if any, environmental issues may exist on the Property", and to assist the Trustee in his efforts "in marketing the Debtor's business for sale as a going concern." A copy of the Court's May 20, 2011 Brief Memorandum and Order is available at http://is.gd/sMLFjpfrom Leagle.com. The Kasden Fuel Company in East Hartford, Connecticut, filed for Chapter 11 bankruptcy (Bankr. D. Conn. Case No. 10-21973) on June 11, 2010. Jon P. Newton, Esq. -- jnewton@reidandriege.com -- at Reid & Riege, serves as the Debtor's bankruptcy counsel. In its petition, the Debtor listed $1 million to $10 million in assets and debts. The petition was signed by Bruce J. Deitch, the Company's president. LA JOLLA: Has $15.44 Million Outstanding Common Shares ------------------------------------------------------ La Jolla Pharmaceutical Company reported that on May 23, 2011, it had converted approximately 8 shares of Series C-1 1 Convertible Preferred Stock into 1,352,332 shares of common stock. Following these conversions, the Company had a total of 15,447,991 shares of common stock issued and outstanding. About La Jolla Pharmaceutical San Diego, Calif.-based La Jolla Pharmaceutical Company (OTC BB: LJPC) -- http://www.ljpc.com/-- is a biopharmaceutical company that has historically focused on the development and testing of Riquent as a treatment for Lupus nephritis. The Company's balance sheet at March 31, 2011, showed $6.74 million in total assets, $12.58 million in total liabilities, all current, $5.57 million in Series C-1 1 redeemable convertible preferred stock, and a $11.41 million total stockholders' deficit. The Company reported a net loss of $3.76 million on $0 of revenue from collaboration agreement for the year ended Dec. 31, 2010, compared with a net loss of $8.63 million on $8.12 million of revenue from collaboration agreement during the prior year. As reported by the TCR on April 18, 2011, BDO USA, LLP, in San Diego, Calif., expressed substantial doubt about the Company's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has suffered recurring losses from operations, an accumulated deficit of $428 million as of Dec. 31, 2010 and has no current source of revenues. LANDAMERICA 1031: $14.3 Million Deal Ends SunTrust ARS Dispute -------------------------------------------------------------- Hilary Russ at Bankruptcy Law360 reports that a liquidation trustee charged with recovering money for creditors of a LandAmerica Financial Group Inc. subsidiary asked a Virginia bankruptcy court on Thursday to approve a $14.3 million settlement with SunTrust Banks Inc. over the sale of auction rate securities. According to Law360, the settlement would bring recoveries for many of the creditors of LandAmerica 1031 Exchange Services Inc. of up to 66.5 cents on the dollar, following previous settlements including a $95.5 million deal with a second bank in October. About LandAmerica Financial LandAmerica Financial Group, Inc., provides real estate transaction services with offices nationwide and a vast network of active agents. LandAmerica and its affiliates operate through approximately 700 offices and a network of more than 10,000 active agents throughout the world, including Mexico, Canada, the Caribbean, Latin America, Europe, and Asia. LandAmerica Financial Group and its affiliate LandAmerica 1031 Exchange Services, Inc., filed for Chapter 11 protection Nov. 26, 2008 (Bankr. E.D. Va. Lead Case No. 08-35994). Attorneys at Willkie Farr & Gallagher LLP and McGuireWoods LLP serve as co- counsel. Zolfo Cooper is the restructuring advisor. Epiq Bankruptcy Solutions serves as claims and notice agent. Attorneys at Akin Gump Strauss Hauer & Feld LLP and Tavenner & Beran, PLC, serve as counsel to the Creditors Committee of 1031 Exchange. Bingham McCutchen LLP and LeClair Ryan serve as counsel to the Creditors Committee of LFG. In its bankruptcy petition, LFG disclosed total assets of $3.32 billion and total debts of $2.84 billion as of Sept. 30, 2008. On March 6, 2009, affiliate LandAmerica Assessment Corporation, aka National Assessment Corporation, filed its own petition for Chapter 11 relief. Affiliate LandAmerica Title Company filed for for Chapter 11 relief on March 27, 2009. LandAmerica Credit Services, Inc., filed for Chapter 11 in July 2009. LAS VEGAS RAILWAY: CFO Gregory West Resigns; Replacement Named -------------------------------------------------------------- Gregory P. West has resigned his position as Chief Financial Officer, Secretary, and Treasurer on May 18, 2011. Mr. West resigned for personal reasons and has no disputes or disagreements with the Company. On May 19, 2011, Wanda Witoslawski was offered and accepted the position of Chief Financial Officer and Treasurer. About Las Vegas Railway Las Vegas, Nev.-based Las Vegas Railway Express, Inc., formerly Liberty Capital Asset Management, Inc. was formed March 9, 2007, as Corporate Outfitters, a development stage company. On Nov. 3, 2008, with a share exchange, asset purchase agreement the Company acquired Liberty Capital Asset Management, a Nevada corporation, formed in July of 2008 as a holding company for all the assets of CD Banc LLC in contemplation of the company going public via a reverse merger into a publicly trading corporation. CD Banc LLC was formed in 2003 as a Nevada limited liability corporation with the purpose of acquiring real estate assets and holding them for long-term appreciation. The Company acquired Las Vegas Railway Express (LVRE) in January 2010 and began its operations as the primary business of the Company. The Company subsequently changed its name from Las Vegas Railway Express, to Las Vegas Railway Express, Inc., and is traded under the symbol XTRN.OB. The Company's balance sheet at June 30, 2010, showed $1.32 million in total assets, $2.09 million in total liabilities, and a stockholders' deficit of $770,059. Hamilton, PC, in Denver, Colo, expressed substantial doubt about the Company's ability to continue as a going concern, following its results for the fiscal year ended March 31, 2010. The independent auditors noted that the Company has suffered recurring losses from operations. For the quarter ended, June 30, 2010, there were no revenues associated with the railcar operations. The Company has an accumulative deficit of $8.49 million through June 30, 2010. Although a substantial portion of the Company's cumulative net loss is attributable to discontinued operations, management believes that it will need additional equity or debt financing to be able to sustain profitability. LASALLE RESIDENTIAL: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: LaSalle Residential Holdings Corporation 200 East Randolph Drive Chicago, IL 60601 Bankruptcy Case No.: 11-15464 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Redfield T. Baum Sr. Debtor's Counsel: Stephen E. Traverse, Esq. Buckley King LPA 2020 N. Central Ave., #1120 Phoenix, AZ 85004 Tel: (602) 325-1569 Fax: (602) 424-2566 E-mail: traverse@buckleyking.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/azb11-15464.pdf The petition was signed by Timothy T. Balin, president. LEGAL XTRANET: Suit v. AT&T Management Goes Back to State Court --------------------------------------------------------------- Bankruptcy Judge Leif M. Clark remands the lawsuit, LEGAL XTRANET, INC. D/B/A/ ELUMICOR, v. AT&T MANAGEMENT SERVICES, L.P. F/K/A SBC MANAGEMENT SERVICES, L.P., Adv. Proc. No. 11-05042 (Bankr. W.D. Tex.), to state court, at AT&T's behest, saying the lawsuit involves only state law claims that are non-core. A copy of the Court's May 24, 2011 Decision and Order is available at http://is.gd/09UKWvfrom Leagle.com. Legal Xtranet, Inc., dba Elumicor, filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-51042) on March 28, 2011, listing under $1 million in both assets and debts. A copy of its petition is available at http://bankrupt.com/misc/txwb11-51042.pdf LESLIE DANNER: Bauer & French Pay Terms Violate Bankruptcy Code --------------------------------------------------------------- Chief Bankruptcy Judge Terry L. Myers denied the request of Leslie and Terriann Danner to employ Bauer & French as attorneys, saying the fee arrangement is designed to skirt the compensation approval procedures of the Bankruptcy Code. According to Judge Myers, although creatively advanced and ably argued, the compensation terms and conditions are inconsistent with the policies and provisions of the Bankruptcy Code, as well as the Idaho Rules of Professional Conduct. Pursuant to the Application, the Debtors propose to pay the firm at their normal hourly rate of $225 per hour for Randal J. French; $200 per hour for Robin Long and $125 per hour for Jared C. Hoskins. The Debtors have paid the firm $8,539 as an advance payment retainer. From that retainer, the Debtors paid $1,039 for the chapter 11 filing fee and $7,500 as advance payments. Accompanying the Application was the verified statement of Bauer & French as required by Fed. R. Bankr. P. 2014(a). In addition to the required disclosures and verifications of lack of adverse interest required under Rule 2014(a) and case law, Bauer & French stated that it has received $7,500 as an advance payment to file the Debtors' Chapter 11, plus $1,039 as a filing fee. From that retainer, Bauer & French applied $7,500 as an advance payment retainer. Bauer & French also indicated that, at an appropriate time, it will account for all services rendered, and refund any unearned retainer or seek additional compensation if the fees for services rendered exceeds the amount of the advance payment retainer. From that retainer, Bauer & French paid $1,039 for the Chapter 11 filing fee. No other attorney fees will be paid, pending further court order after notice to all parties in interest and a hearing on applications as are required by the applicable rules. Bauer & French also said it has received no other funds from the Debtors, or for their benefit, in the one year prior to the filing of the petition in the case. The United States Trustee objected to the Application. The Court and the U.S. Trustee expressed concern over operation of the "advance payment retainer" as conceived and intended by Counsel and the Debtors. A copy of the Court's May 26, 2011 Memorandum of Decision is available at http://is.gd/3YaiE2from Leagle.com. Judge Myers also denied an application by another debtor entity, KM Allied of Nampa, LLC, to employ Bauer & French as counsel, citing the compensation structure. Leslie and Terriann Danner filed for Chapter 11 bankruptcy (Bankr. D. Idaho Case No. 11-00651) on March 16, 2011. LEVEL 3: Subsidiary Enters Into Supplemental Indenture ------------------------------------------------------ Level 3 Financing, Inc., a wholly owned subsidiary of Level 3 Communications, Inc., entered into a Supplemental Indenture dated as of May 24, 2011, to the Indenture, dated as of March 4, 2011, among Level 3 Communications, Inc., as Guarantor, Level 3 Financing, as Issuer, and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Level 3 Financing's 9.375% Senior Notes due 2019. The Guarantee Supplemental Indenture was entered into among Level 3 Financing, Level 3 Communications, LLC, a wholly owned subsidiary of Level 3 Communications, Inc., and The Bank of New York Mellon Trust Company, N.A., as Trustee. Pursuant to the Guarantee Supplemental Indenture, Level 3 LLC has provided an unconditional, unsecured guaranty of the Notes. On May 24, 2011, Level 3 Financing entered into an additional Supplemental Indenture, dated as of May 24, 2011, to the Indenture. The Subordination Supplemental Indenture was entered into among Level 3 Financing, Level 3 Communications, Inc., Level 3 LLC and The Bank of New York Mellon Trust Company, N.A., as Trustee. Pursuant to the Subordination Supplemental Indenture, the unconditional, unsecured guaranty of Level 3 LLC of the Notes will be subordinated in any bankruptcy, liquidation or winding up proceeding of Level 3 LLC to all obligations of Level 3 LLC under the Level 3 Financing Amended and Restated Credit Agreement dated as of March 13, 2007. 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. 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. The Company's balance sheet at March 31, 2011, showed $8.80 billion in total assets, $9.06 billion in total liabilities, and a $265 million total stockholders' deficit. LEWIS AND CLARK: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Lewis and Clark Apartments, LP 165 N. Meramec, Suite 500 St. Louis, MO 63105 Bankruptcy Case No.: 11-45515 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Eastern District of Missouri (St. Louis) Judge: Kathy A. Surratt-States Debtor's Counsel: Nicholas A. Franke, Esq. SPENCER FANE BRITT BROWNE LLP 1 North Brentwood, Suite 1000 St. Louis, MO 63105 Tel: (314) 863-7733 Fax: (314) 862-4656 E-mail: nfranke@spencerfane.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/moeb11-45515.pdf The petition was signed by Timothy R. Wolf, president of Lewis and Clark Partners, LLC, general partner. LIBBEY INC: Three Directors Elected at Annual Meeting ----------------------------------------------------- The Annual Meeting of the shareholders of Libbey Inc. was held on May 19, 2011. Three individuals were elected to serve as directors for a three-year term: (1) William A. Foley (2) Deborah G. Miller (3) Terence P. Stewart The non-binding advisory resolution on the Company's 2010 executive compensation was approved. Stockholders approved advisory votes on executive compensation to be held every year. Ernst & Young LLP was ratified as the Company's independent auditors for the fiscal year ending Dec. 31, 2011. About Libbey Inc. Based in Toledo, Ohio, since 1888, Libbey, Inc., operates glass tableware manufacturing plants in the United States in Louisiana and Ohio, as well as in Mexico, China, Portugal and the Netherlands. Libbey supplies tabletop products to foodservice, retail, industrial and business-to-business customers in over 100 countries. The Company's balance sheet at March 31, 2011, showed $778.87 million in total assets, $758.58 million in total liabilities and $20.29 in million total shareholders' equity. * * * Libbey carries 'B' issuer credit ratings, with stable outlook, from Standard & Poor's Ratings Services. On Oct. 28, 2009, Libbey restructured a portion of its debt by exchanging the old 16% Senior Subordinated Secured Payment-in- Kind Notes due December 2011 of subsidiary Libbey Glass Inc., having an outstanding principal amount as of October 28, 2009, of $160.9 million for (i) $80.4 million principal amount of new Senior Subordinated Secured Payment-in-Kind Notes due 2021 of Libbey Glass, and (ii) 933,145 shares of common stock and warrants exercisable for 3,466,856 shares of common stock of Libbey Inc. On Feb. 8, 2010, Libbey used the proceeds of a $400.0 million debt offering of 10.0% Senior Secured Notes due 2015 of Libbey Glass Inc., as well as cash on hand, to (i) repurchase the $306.0 million then outstanding Floating Rate Senior Secured Notes due 2011 of Libbey Glass, (ii) repay the $80.4 million New PIK Notes and (iii) pay related fees and expenses. Concurrent with the closing of the offering of the Senior Secured Notes, Libbey entered into an amended and restated $110 million Asset Based Loan facility which, among other terms, extended the maturity date to 2014. LIFECARE HOLDINGS: Moody's Affirms Caa1 Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service changed Lifecare Holdings Inc.'s outlook to stable from negative and upgraded the speculative grade liquidity (SGL) rating to SGL-3 from SGL-4. The actions result from the reduced refunding risk and expectation for modest improvement in operating performance. Concurrently, Moody's affirmed the Caa1 corporate family and probability of default ratings and Caa3 senior subordinated notes rating. These rating actions were taken: -- Corporate family rating, affirmed at Caa1; -- Probability of default rating, affirmed at Caa1; -- $119.3 million senior subordinated notes, due 2013, affirmed at Caa3 (LGD6, 90%); -- Speculative Grade Liquidity Rating, upgraded to SGL-3 from SGL-4. These ratings were withdrawn: -- $255 million senior secured term loan, due 2012; -- $60 million senior secured revolving credit facility, due 2011. RATINGS RATIONALE The Caa1 corporate family rating continues to reflect Lifecare's considerable pro forma debt leverage of approximately 7.1 times and limited interest coverage as measured by (EBITDA-CAPEX)/ Interest expense of 1 times for 2011. The ratios are calculated pro forma for the acquisition of 8 long-term acute care hospitals (LTACHs) that are expected to contribute about $10 million of annual EBITDA. The facilities will be financed with a $47 million incremental senior secured term loan (not rated by Moody's) and an $80 million sale-leaseback transaction with Healthcare REIT. Lifecare will not take title to the property. The rating also considers the company's reliance on the specialty hospital segment that results in a 60% Medicare revenue concentration. Further, Lifecare's absolute scale and size is moderate when compared to some of its competitors; it operates 28 facilities in 10 states (pro forma for the recent acquisition). High concentration by state and payor make the company susceptible to changes in Medicare payment schedules and event-risk related to a single facility. The rating favorably reflects the company's competitive position in local markets, good EBITDA margins due to high acuity mix, and improvement in liquidity profile as reflected in the change of the SGL to SGL-3 from SGL-4. Lifecare's new credit agreement that was put in place in February 2011 increased headroom under financial covenants significantly. Nevertheless, the spread over LIBOR is considerable -- at 13.25% (company could choose to PIK 5.5%). In addition, by entering into the new credit agreement, the company eased the refunding risk as it extended the maturities of its debt obligations. The revolving credit facility and term loans are due in 2015 and 2016, respectively and the senior subordinated notes are due in 2013. However, the credit facilities have a springing maturity at May 15, 2013 that is triggered if the subordinated notes have not been refinanced, purchased, or defeased in full by May 15, 2013. The change in the outlook to stable reflects the expectation that the company will modestly improve its debt leverage and interest coverage metrics through operational improvements such as improving clinical documentation and reducing accounts receivable days. Additionally, the fiscal 2012 proposal by Centers of Medicare and Medicaid (CMS) for Medicare reimbursement rates was a 1.2% net increase in the base rate, thus, Moody's expects the rates to be relatively stable through next year and a half. The ratings could be downgraded if (i) the company's free cash flow turns negative on a sustained basis (ii) the company's liquidity profile weakens due to the tightening of headroom under the financial covenants (iii) there are declines in Medicare reimbursement for 2012 or beyond or (iv) the moratorium ends in 2012 with adverse implications for the company's operating performance. The ratings could be upgraded if debt to EBITDA was expected to be sustained below 6 times, interest coverage above 1.25 times, and free cash flow to debt above 3 percent. Additionally, there could be upward pressure if the company were to improve its occupancy rates and report a steady increase in patient visits. The principal methodologies used in rating LifeCare were Global For-Profit Hospital Industry published in September 2008, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Plano, TX, LifeCare operates 20 long-term acute care hospitals in nine states. The company's facilities include eight "hospital within a hospital" facilities ("HWH") and 12 free- standing facilities. In addition, the company holds a 50% investment in a joint venture for a long-term care hospital. LifeCare reported revenues of $358 million for the twelve months ended March 31, 2011. MARINA BIOTECH: Posts $3.7 Million Net Loss in First Quarter ------------------------------------------------------------ Marina Biotech, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $3.7 million on $214,000 of revenue for the three months ended March 31, 2011, compared with a net loss of $9.5 million on $184,000 of revenue for the same period last year. The change in fair value liability for price adjustable warrants and subscription investment units was income of approximately $1.6 million in the quarter ended March 31, 2011, compared to expense of approximately $2.7 million in the quarter ended March 31, 2010. The Company's balance sheet at March 31, 2011, showed $29.1 million in total assets, $9.8 million in total liabilities, and stockholders' equity of $19.3 million. As reported in the TCR on March 29, 2011, KPMG LLP, in Seattle, Wash., expressed substantial doubt about Marina Biotech's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred recurring losses and has an accumulated deficit, and has had recurring negative cash flows from operations. A copy of the Form 10-Q is available at http://is.gd/Ixy2w1 Bothell, Wash.-based Marina Biotech, Inc. (Nasdaq: MRNA) -- http://www.marinabio.com/-- is a biotechnology company, focused on the development and commercialization of RNA interference- (RNAi) and RNA-based therapeutics. MCCLATCHY CO: Promotes Mark Zieman to Vice Pres. Operations ----------------------------------------------------------- The McClatchy Company, on May 18, 2011, announced the promotion of Mark Zieman, 50, to the position of Vice President, Operations effective May 31, 2011. Mr. Zieman is filling the position left vacant as a result of the previously announced retirement of Frank Whittaker on May 27, 2011. Mr. Zieman, who most recently was the publisher of The Kansas City Star, will oversee 13 daily newspapers and their affiliated operations in seven states, primarily in the Midwest and Southeast. These include the (Columbus) Ledger-Enquirer, The (Macon) Telegraph, the Belleville News-Democrat, The Wichita Eagle, the (Biloxi) Sun Herald, The Kansas City Star, The Charlotte Observer, The (Raleigh) News & Observer, The Beaufort Gazette, The (Rock Hill) Herald, The (Hilton Head) Island Packet, The (Columbia) State and The (Myrtle Beach) Sun News. Mr. Zieman was named president and publisher of The Kansas City Star in 2008. From 1997 to 2008, he served as the newspaper's editor and vice president. Prior to that, Mr. Zieman was an investigative reporter from 1986 to 1989 where he rose through the newsroom management. He became projects editor in 1989, managing editor in 1992 and was named editor in 1997. In connection with Mr. Zieman's new position, the Compensation Committee of the Board of Directors of the Company has approved the following compensation specifically related to Mr. Zieman's promotion: -- An annual base salary of $500,000 effective May 31, 2011; and -- A 2011 annual incentive compensation target award of 70% of Mr. Zieman's annual base salary, subject to certain performance conditions and to the terms and conditions of the Company's Management by Objective Plan, which is included as Exhibit 10.4 to the Company's Annual Report on Form 10-K filed on March 24, 2000. In connection with his appointment as a principal operating officer of the Company, Mr. Zieman will enter into the Company's standard form of Indemnification Agreement for executive officers. There is no arrangement or understanding between Mr. Zieman and any other persons pursuant to which he was selected as a principal operating officer. The Company held its annual meeting of stockholders on May 18, 2011. As of the applicable record date of March 22, 2011, there were outstanding 60,334,574 shares of Class A Common Stock and 24,800,962 shares of Class B Common Stock. Shares representing 84.8% of the voting power of the Company were represented at the Meeting in person or by proxy. At the Meeting the stockholders: (i) elected the Company's Class A and Class B directors for the ensuing year; (ii) ratified the selection of Deloitte & Touche LLP as the Company's independent auditors for 2011; (iii) approved, on an advisory, non-binding basis, the Company's executive compensation; and (iv) approved, on an advisory, non-binding basis, the triennial frequency of Say on Pay votes. The Stockholders elected 11 directors at the Annual Meeting: Class A: Elizabeth Ballantine Kathleen Foley Feldstein S. Donley Ritchey Class B: Leroy Barnes, Jr. Molly Maloney Evangelisti Brown McClatchy Maloney William B. McClatchy Kevin S. McClatchy Theodore R. Mitchell Gary B. Pruitt Frederick R. Ruiz About The McClatchy Company Sacramento, Calif.-based The McClatchy Company (NYSE: MNI) -- http://www.mcclatchy.com/-- is the third largest newspaper company in the United States, publishing 30 daily newspapers, 43 non-dailies, and direct marketing and direct mail operations. McClatchy also operates leading local websites in each of its markets which extend its audience reach. The websites offer users comprehensive news and information, advertising, e-commerce and other services. Together with its newspapers and direct marketing products, these interactive operations make McClatchy the leading local media company in each of its premium high growth markets. McClatchy-owned newspapers include The Miami Herald, The Sacramento Bee, the Fort Worth Star-Telegram, The Kansas City Star, The Charlotte Observer, and The News & Observer (Raleigh). The Company's balance sheet at March 27, 2011, showed $3.04 billion in total assets, $2.82 billion in total liabilities and $220.13 million in stockholders' equity. * * * In February 2010, Moody's Investors Service upgraded The McClatchy Company's Corporate Family Rating to Caa1 from Caa2, Probability of Default Rating to Caa1 from Caa2, and senior unsecured and unguaranteed note ratings to Caa2 from Caa3, concluding the review for upgrade initiated on January 27, 2010. The upgrades reflect McClatchy's improved liquidity position and reduced near-term default risk following completion of the company's refinancing, and its ability to stabilize EBITDA performance through significant cost reductions. The rating outlook is stable. Standard & Poor's Ratings Services also raised its corporate credit on Sacramento, California-based The McClatchy Co. to 'B' from 'B-'. The upgrade reflects the significant current and expected moderation in the pace of ad revenue declines in 2010 and 2011 and improving debt leverage and discretionary cash flow. As reported by the Troubled Company Reporter on Feb. 8, 2011, Fitch Ratings has upgraded the Issuer Default Rating of the McClatchy Company to 'B-'. The Rating Outlook is Stable. The revenue declines endured by McClatchy in 2010 were materially lower than Fitch's expectation. Fitch had modeled declines in the mid-teens versus actual declines in the mid-single digits. While Fitch expected the company to focus on cost containment, the company's success exceeded Fitch expectations. Fitch had expected EBITDA to decline more than 10% versus actual EBITDA growth in the mid-single digits. As a result absolute debt and leverage were better than Fitch expectations. Fitch estimates 2010 year end gross unadjusted leverage of approximately 4.7 times. Fitch expects the company will be able to meet its pension funding obligations and satisfy all of its maturities up to and including its senior unsecured notes due in 2014 ($169 million balance as of Sept. 30, 2010). Also, Fitch does not expect McClatchy will have any issues meeting its credit agreement financial covenants (under both Fitch's base and stress cases). MCCLATCHY CO: Moody's Changes Rating Outlook to Positive -------------------------------------------------------- Moody's Investors Service changed The McClatchy Company's (McClatchy) rating outlook to positive from stable following the company's announcement that it closed on the sale of land in Miami for $236 million. The outlook change reflects Moody's expectation that McClatchy will utilize the net proceeds to reduce debt, including its underfunded pension position, which will reduce leverage by approximately half a turn and lower required contributions to the pension plan over the next few years. Moody's affirmed McClatchy's Caa1 Corporate Family Rating (CFR) based the company's continuing high leverage (approximately 6.1x LTM 3/27/11 incorporating Moody's standard adjustments and the effects of the Miami land sale) and the ongoing newspaper industry revenue pressure. Debt instrument ratings are not affected, but Moody's updated the loss given default assessments to reflect the updated debt mix. LGD Updates: Issuer: McClatchy Company (The) -- Senior Secured Bank Credit Facility, Changed to LGD2 - 19% from LGD2 - 22% (no change to B1 rating) -- Senior Secured Regular Bond/Debenture, Changed to LGD2 - 19% from LGD2 - 22% (no change to B1 rating) -- Senior Unsecured Regular Bond/Debenture, Changed to LGD5 - 79% from LGD5 - 80% (no change to Caa2 ratings) Outlook Actions: Issuer: McClatchy Company (The) -- Outlook, Changed To Positive From Stable RATINGS RATIONALE Economic conditions in McClatchy's markets remain soft and the company's revenue continues to contract -- lagging the newspaper sector and the broader advertising market. Moody's projects McClatchy's EBITDA will decline by approximately 20% from 2010 to 2012 and this will necessitate further debt reduction in order to lower leverage. Moody's believes this could be challenging if the economy were to remain soft or weaken. However, Moody's believes a positive outlook is warranted given the proximity of debt-to- EBITDA leverage to the 6x or lower range that could lead to an upgrade, continued projected free cash flow generation and McClatchy's ongoing plans to reduce debt, and low default risk over the next two years. McClatchy received approximately $228 million net proceeds (after $2 million of transfer taxes and $6 million being held in escrow) and plans to make a $163 million contribution to its pension plan. The company is required by the terms of its $865 million 11.5% notes to make an offer to repurchase the bonds at par from the remaining $65 million proceeds. Because the 11.5% notes are trading comfortably above par, Moody's anticipates bondholders will decline the repurchase offer. Moody's expects McClatchy will utilize the funds for pension contributions, bond repurchases or any capital gains taxes on the land sale. McClatchy's December 2010 credit agreement amendment permits it to repurchase any of its outstanding bonds. Because Moody's includes the underfunded pension in debt, the pension contributions will reduce leverage. Moody's expects McClatchy to retire the remaining $18 million 7.125% notes at the June 1, 2011 maturity date and to repay the $7.8 million of revolver borrowings outstanding at the end of the first quarter. Thereafter, McClatchy will have no funded debt maturities until $161 million of notes expire in November 2014 with required pension contributions being the only meaningful cash obligation in the interim. The actions will reduce the required pension contribution and increase financial flexibility. Moody's believes the remaining mandatory contributions can be comfortably funded within McClatchy's projected free cash flow. McClatchy's lease rent expense will increase over the next two years due to the sale-leaseback in the first quarter of 2011 and the need to find new facilities to house the Miami Herald operations. McClatchy's SGL-2 speculative-grade liquidity rating reflects its good liquidity position for the next 12-15 months, with cash (approximately $4 million as of 3/27/11), an estimated $130 million of free cash flow for the next 12 months, and modest unused capacity under the $125 million revolver (after factoring in letters of credit and the revolver's $50 million minimum availability requirement), comfortably covering the $18.2 million maturity in June 2011. Moody's also expects McClatchy's EBITDA cushion within its revolver financial maintenance covenants will exceed 20% over the next 12-15 months. The principal methodology used in rating The McClatchy Company was the Moody's Global Newspaper Industry Methodology, published September 2008. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. MCINTOSH BANCSHARES: Expects $2.4-Mil. First Quarter Net Loss ------------------------------------------------------------- McIntosh Bancshares, Inc., discloses that continued adverse economic conditions in its market area during 2010 and 2011, particularly in the housing and real estate markets, have necessitated ongoing evaluation of McIntosh Bank's provision and allowance for loan losses and various expenses relating to the Bank's other real estate owned (OREO) and loan portfolios, and as a result of this process, the completion of the Company's consolidated financial statements for the quarter ended March 31, 2011 has been delayed. The Company has also not filed its annual report on Form 10-K for the fiscal year ended Dec. 31, 2010. Management anticipates that its unaudited nonperforming assets will total approximately $83.0 million at March 31, 2011, compared to approximately $83.8 million at Dec. 31, 2010. The Company anticipates a substantial net loss for the quarter ended March 31, 2011, although the Company avers that results are an improvement compared to the quarter ended March 31, 2010. The Company says it experienced favorable variances in loan loss provision ($6.0 million improvement as compared to the first quarter of 2010) and salaries and benefits ($777,000 improvement as compared to the first quarter of 2010). However, according to the Company, these improvements were partially offset by a $330,000 decline in net interest income; $609,000 more in net other real estate (ORE) and repossession losses; $258,000 more in professional fees, primarily due to expenses incurred in managing non-performing assets; a $79,000 increase in regulatory fees; and a $73,000 reduction in income from Bank Owned Life Insurance due to the liquidation of that group of assets in July, 2010. Management anticipates that the Company's unaudited loss for the quarter ended March 31, 2011, will be $2.4 million compared to a net loss of $7.9 million for the quarter ended March 31, 2010. Additionally, management anticipates that the independent auditor's report with respect to its audited financial statements for the year ended Dec. 31, 2010, if issued, will contain an explanatory paragraph indicating that there is substantial doubt about the Company's ability to continue as a going concern. Information about the Bank's financial condition and results of operations as of March 31, 2011, is publicly available, free of charge, on the FDIC's website at www.fdic.gov. About McIntosh Bancshares Jackson, Ga.-based McIntosh Bancshares, Inc., operates as the bank holding company for McIntosh State Bank that provides commercial banking products and services to individuals and corporate customers in Georgia. METISCAN, INC: Posts $10,300 Net Loss in First Quarter ------------------------------------------------------ Metiscan, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $10,346 on $485,561 of revenues for the three months ended March 31, 2011, compared with a net loss of $74,472 on $898,628 of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $12.0 million in total assets, $4.4 million in total liabilities, and stockholders' equity of $7.6 million. As reported in the TCR on April 25, 2011, Eugene M Egeberg, CPA, in Baltimore, expressed substantial doubt about Metiscan's ability to continue as a going concern, following the Company's 2010 results. Mr. Egeberg noted that the Company has a large accumulated deficit through Dec. 31, 2010. A copy of the Form 10-Q is available at http://is.gd/Lifkab Dallas, Tex.-based Metiscan, Inc. (OTC PK: MTIZ) -- http://www.metiscan.com/-- is the parent company of a portfolio of enterprises with operations in healthcare, healthcare IT, mobile technology and employment services. METROGAS S.A.: Posts ARS26.3 Million Net Loss in First Quarter -------------------------------------------------------------- MetroGAS S.A. filed its unaudited consolidated interim financial statements as of March 31, 2011, reporting a net loss of ARS26.3 million on ARS231.6 million of sales for the three months ended March 31, 2011, compared with a net loss of ARS15.1 million on ARS225.7 million of sales for the same period of 2010. The Company's balance sheet at March 31, 2011, showed total assets of ARS2.473 billion, total liabilities of ARS1.671 billion, minority interest of ARS2.0 million, and shareholders' equity of ARS799.6 million. As reported in the TCR on May 3, 2011, Price Waterhouse & Co. S.R.L., in Buenos Aires, Argentina, expressed substantial doubt about MetroGas S.A.'s ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted of uncertainties related to the suspension of the original regime for tariff adjustments and the Company's petition for voluntary reorganization in an Argentine Court on June 17, 2010. A copy of the Company's unaudited consolidated interim financial statements for the three months ended March 31, 2011, is available at http://is.gd/V7qDm7 About MetroGas Buenos Aires-based MetroGAS S.A., which listed its American Depositary Shares on the New York Stock Exchange and Buenos Aires Stock Exchange in November 1994, is Argentina's largest natural gas distribution company in terms of number of customers and volume of gas deliveries, according to the 2010 annual report of ENARGAS, an agency of the Argentine Government, which has broad authority over the gas distribution and transportation industries, including their tariffs. The Company has approximately 2.2 million customers in its service area (the city of Buenos Aires and southern and eastern greater metropolitan Buenos Aires). The Company is one of nine natural gas distribution companies formed in connection with the privatization of Gas del Estado. The suspension of the original regime for tariff adjustments and the inability to generate sufficient cash flows to pay its financial debt obligations led the Company to file a petition for a voluntary reorganization proceeding (concurso preventivo) in an Argentine court on June 17, 2010. MIT HOLDING: Incurs $567,800 Net Loss in First Quarter ------------------------------------------------------ MIT Holding, Inc., filed with the U.S. Securities and Exchange Commission its Quarterly Report on Form 10-Q reporting a net loss of $567,814 on $5.08 million of sales and services rendered for the three months ended March 31, 2011, compared with a net loss of $201,510 on $1.67 million of sales and services rendered for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $16.14 million in total assets, $18.69 million in total liabilities and a $2.54 million total stockholders' deficiency. At March 31, 2011, the company had negative working capital of $1,185,879 and a stockholders' deficiency of $2,247,789. From inception the Company has incurred an accumulated deficit of $8,527,203. The Company said these factors raise substantial doubt its ability to continue as a going concern. As reported by the TCR on April 27, 2011, Michael T. Studer CPA P.C., in Freeport, New York, expressed substantial doubt about MIT Holding's ability to continue as a going concern. The independent auditors noted that the Company negative working capital of $1.2 million and a stockholders' deficiency of $2.2 million. "From inception the Company has incurred an accumulated deficit of $8.5 million." A full-text copy of the Form 10-Q is available for free at: http://is.gd/BIfoqb About MIT Holding Savannah, Ga.-based MIT Holding, Inc. (OTC BB: MITD) -- http://www.mitholdinginc.com/-- distributes wholesale pharmaceuticals, administers intravenous infusions, operates an ambulatory center where therapies are administered and sells and rents home medical equipment. The Company reported net income of $78,832 on $7.1 million of revenue for 2010, compared with a net loss of $1.2 million on $6.4 million of revenue for 2009. MIT HOLDING: Has 5-Year Distribution Deal with Global Reach ----------------------------------------------------------- MIT Holding Inc., on May 11, 2011, executed a five-year agreement with Global Reach International, Inc., for the appointment as distributor of 7,200,000 units of the Provector, with an aggregate value of $86,500,000 over a period of five years with a projected profit of $36,000,000. The contract is subject to the Nigerian government's formal approval which is in process at this time. A full-text copy of the Distribution Agreement is available at no charge at http://is.gd/MLXdoY About MIT Holding Savannah, Ga.-based MIT Holding, Inc. (OTC BB: MITD) -- http://www.mitholdinginc.com/-- distributes wholesale pharmaceuticals, administers intravenous infusions, operates an ambulatory center where therapies are administered and sells and rents home medical equipment. As reported by the TCR on April 27, 2011, Michael T. Studer CPA P.C., in Freeport, New York, expressed substantial doubt about MIT Holding's ability to continue as a going concern. The independent auditors noted that the Company negative working capital of $1.2 million and a stockholders' deficiency of $2.2 million. "From inception the Company has incurred an accumulated deficit of $8.5 million." The Company reported net income of $78,832 on $7.1 million of revenue for 2010, compared with a net loss of $1.2 million on $6.4 million of revenue for 2009. At Dec. 31, 2010, the Company's balance sheet showed $1.1 million in total assets, $3.4 million in total liabilities, and a stockholders' deficit of $2.2 million. MMFX INTERNATIONAL: Agreed to Termination of Plan Exclusivity ------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California approved a stipulated resolution, terminating MMFX International Holdings, Inc., et al.'s exclusive periods to file and solicit acceptances for the proposed chapter 11 plan. The stipulation was entered between the Debtors and the Official Committee of Unsecured Creditors in the Debtors' cases. The Court ordered that this schedule be adopted: a) May 2, is set as the deadline to file the Disclosure Statement. b) May 31, is fixed as the deadline for filing and serving written objections to the Disclosure Statement. Replies in support of the Disclosure Statement must be filed no later than June 3. c) The hearing to consider approval of the Disclosure Statement will take place on June 7, at 10:00 a.m. (Pacific Standard Time). d) On or before June 10, the Plan, the Disclosure Statement, a ballot and a notice of the confirmation hearing will be mailed to creditors, equity holders and other parties in interest, and will be transmitted to the U.S Trustee. The Plan Proponents are authorized to reproduce the Disclosure Statement and Plan single-spaced and in a legible manner for purposes of mailing. e) July 8, at 5:00 p.m. is fixed as the deadline for filing and serving written objections to confirmation of the Plan. f) July 8, at 5:00 p.m. is set as the voting deadline by which all ballots must be mailed or delivered to the balloting agent designated on the ballots so that they are actually received on or before the voting deadline. g) July 19, is fixed as the deadline to file with the Court the tabulation of all acceptances and rejections of the Plan. h) A hearing on confirmation of the plan will be held on July 22, at 9:00 a.m. About MMFX Irvine, California-based MMFX International Holdings, Inc., and MMFX Canadian Holdings, Inc., filed for Chapter 11 (Bankr. C.D. Calif. Case Nos. 10-10085 and 10-10083) on Jan. 5, 2010. Margaret M. Mann, Esq., at Sheppard Mullin Richter & Hampton LLP represents the Debtors in their restructuring efforts. MMFX Int'l and MMFX Canadian estimated assets and debts at $50 million to $100 million as of the Chapter 11 filing. The Debtors tapped Pillsbury Winthrop Shaw Pittman LLP as their special corporate counsel, and Bidna & Keys APLC as their special counsel. The Official Committee of the Unsecured Creditors in the Debtors' cases tapped Pachulski Stang Ziehl & Jones LLP as its counsel. MORTGAGES LTD: Says Greenberg Suit Belongs in State Court --------------------------------------------------------- Pete Brush at Bankruptcy Law360 reports that ML Servicing Co. told an Arizona federal judge Thursday that its suit against Greenberg Traurig LLP and one of its partners contains malpractice and breach of fiduciary duty claims that exist regardless of the ex- mortgage servicer's bankruptcy and thus belong in state court. The suit, according to Law360, is of one of many linked to the fraud committed by Radical Bunny, four managers of which were ordered by U.S. District Judge Susan R. Bolton in an April summary judgment ruling to pay $3.7 million. About Mortgages Ltd. Mortgages Ltd. was the subject of an involuntary Chapter 7 petition dated June 20, 2008, filed by KGM Builders Inc. -- a contractor for Grace Communities, a borrower of the company -- in the U.S. Bankruptcy Court for the District of Arizona. Central & Monroe LLC and Osborn III Partners LLC, divisions of Grace Communities, sought the appointment of an interim trustee for Mortgages Ltd. in the Chapter 7 proceeding. Mortgages Ltd. faced lawsuits filed by Grace Communities and Rightpath Limited Development Group for its alleged failure to fully fund loans. Mortgages Ltd. denied the charges. The Debtor's case was converted to a chapter 11 proceeding on June 24, 2008 (Bankr. D. Ariz. Case No. 08-07465). Judge Sarah Sharer Curley presided over the case. Carolyn Johnsen, Esq., and Bradley Stevens, Esq., at Jennings, Strouss & Salmon P.L.C., replaced Todd A. Burgess, Esq., at Greenberg Traurig LLP, as counsel to the Debtor. As of Dec. 31, 2007, the Debtor had total assets of $358,416,681 and total debts of $350,169,423. Mortgages Ltd. was reorganized pursuant to a plan that was confirmed by the Bankruptcy Court on March 20, 2009. As part of the Plan, ML Manager LLC was created to manage and operate the loans in the portfolio. The original investors for the most part transferred their interests to 49 separate Loan LLC's. A number of investors, referred to as "pass through investors" did not transfer their interests. As part of the Plan, ML Manager took out $20 million in exit financing to help keep the company afloat during the reorganization. MOUNTAINEER GAS: Fitch Upgrades IDR to 'BB'; Outlook Positive ------------------------------------------------------------- Fitch Ratings has upgraded Mountaineer Gas Company's (MGC) Issuer Default Rating (IDR) to 'BB' from 'BB-' and its senior unsecured debt and bank loan ratings to 'BB+' from 'BB'. The Rating Outlook is Positive. Approximately $90 million of long-term debt is affected by the rating actions. The rating upgrade reflects MGC's continued operational improvements and constructive outcome of its 2009 General Rate Case which has produced significantly improved credit metrics. EBITDA to cash interest for the 12 months ended March 31, 2011 improved to 4.0 times (x) compared with 3.1x and 2.3x, respectively, at Dec. 31, 2010 and Dec. 31, 2009. With the all important winter heating season behind it, Fitch expects MGC to finish 2011 with an EBITDA to cash interest ratio of approximately 4.0x. Similarly, MGC is free cash flow positive within Fitch's modeling assumptions of annual capital expenditures of $11 million up to a high of $15 million per annum. The catalyst for this financial improvement was the constructive outcome of MGC's 2009 General Rate Case. The Public Service Commission of West Virginia (WVPSC) approved a $19 million annual increase in revenues, which, when combined with previous operational enhancements implemented by MGC's management, resulted in significantly improved coverage measures and improved liquidity as working capital requirements and related financing costs were reduced. Also beneficial to MGC's financial profile was the $6 million infusion of equity in the fourth quarter of 2010 (4Q'10) concurrent with the acquisition of The East Resources regulated gas distribution business, which added approximately 5,000 customers. MGC's liquidity position is bolstered by an Asset Management Agreement (AMA) with Sequent (a subsidiary of AGL Resources, IDR 'A-' by Fitch) which effectively transfers the natural gas inventory, storage and related financing costs to Sequent. MGC draws down the natural gas inventory as needed to meet customer demand during the peak winter heating season. As a result of the AMA, MGC's seasonal working capital and short term financing needs are substantially reduced. The AMA extends through 2012. Based on expected capital expenditures, MGC is free cash flow positive throughout Fitch's forecast period. Fitch expects a $20 million debt maturity in December 2012 to be refinanced, but otherwise expects little change in MGC's capital structure. MGC's balance sheet leverage with debt to total capital at approximately 53%, while typical for its rating category, reflects greater leverage than Fitch's investment grade guidelines. Fitch projects debt to EBITDA of 4.1x at year-end 2011. Fitch's concerns center on MGC's tariff structure as there is the potential for regulatory lag as expense items such as pensions and real estate taxes are not on trackers. Consequently, higher operating costs from inflation may erode earnings in the years after a rate case settlement. Similarly, MGC's tariff does not have efficiency and conservation riders which may add to cash flow volatility. The Positive Outlook reflects Fitch's expectation that MGC will maintain the momentum from the operational improvements instituted by management since 2009. While Fitch modeled generally flat to slightly lower gas volumes in its forecasts, the gradual recovery in the economy will likely result in higher sales and improved margins. MGC, the sole subsidiary of Mountaineer Gas Holdings LP, is a natural gas distribution company that is engaged in the sale, distribution, and transport gas to 223,000 customers in West Virginia. The company is jointly owned by private investors ArcLight Capital Partners LLC and DB Nexus American Investments (UK) Limited through a joint venture company and by managing partner IGS Utilities, LLC. MSR RESORT: Creditors Committee Wants Challenge Period Extended --------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 cases of MSR Resort Golf Course LLC, et al., asks the U.S. Bankruptcy Court for the Southern District of New York to modify the final cash collateral order that: i) the Committee is afforded 90 days from the date of the order approving the appointment of its counsel to investigate the facts and commence any appropriate challenge as representative of the estate and the Committee may use the Investigation Carve-Out through the date; ii) the prepetition secured parties will provide the Committee with documents relating to the Prepetition Secured Obligations and Prepetition Encumbrances; iii) the Committee is granted standing and authority to commence any challenges; and iv) that modifications and amendments to the final cash collateral order as a result of the motion do not constitute a termination notice event. The Committee relates that the final cash collateral order provides that up to $100,000 of cash collateral may be used to pay the allowed fees and expenses of professional persons incurred directly in connection with investigating, any claims or causes of action against any prepetition secured party, provided further, however, that the investigation carve-out may only be used by, and is only available to, the Committee. However, the Committee had not been appointed when the final cash collateral order was entered. In fact, the Committee was only appointed on May 11, 2011, two days prior to the May 13 deadline for a committee to both investigate and commence a challenge. The Committee is represented by: Martin G. Bunin, Esq. Craig E. Freeman, Esq. ALSTON & BIRD LLP 90 Park Avenue New York, NY 10016 Tel: (212) 210-9400 About MSR Resort MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc., owns a portfolio of eight luxury hotels with over 5,500 guest rooms, including the Arizona Biltmore Resort & Spa in Phoenix, the Ritz-Carlton in Orlando, Fla., and Hawaii's Grand Wailea Resort Hotel & Spa in Maui. On Jan. 28, 2011, CNL-AB LLC acquired the equity interests in the portfolio through a foreclosure proceeding. CNL-AB LLC is a joint venture consisting of affiliates of Paulson & Co. Inc., a joint venture affiliated with Winthrop Realty Trust, and affiliates of Capital Trust, Inc. Morgan Stanley's CNL Hotels & Resorts Inc. owned the resorts before the Jan. 28 foreclosure. Following the acquisition, five of the resorts with mortgage debt scheduled to mature on Feb. 1, 2011, were sent to Chapter 11 by the Paulson and Winthrop joint venture affiliates. MSR Resort Golf Course LLC and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan on Feb. 1. The resorts subject to the filings are Grand Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta Resort and Club and PGA West, Doral Golf Resort and Spa, and Claremont Resort and Spa. James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O. Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The five resorts had $2.2 billion in assets and $1.9 billion in debt as of Nov. 30, 2010, according to court filings. In its schedules, debtor MSR Resort disclosed $59,399,666 in total assets and $1,013,213,968 in total liabilities. NATIONAL AUTOMATION: Swings to $2.23-Mil. First Quarter Profit -------------------------------------------------------------- National Automation Services, Inc., filed with U.S. Securities and Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income of $2.23 million on $220,546 of revenue for the three months ended March 31, 2011, compared with a net loss of $664,376 on $363,363 of revenue for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $818,301 in total assets, $3.10 in total liabilities and a $2.28 total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/sF7Mqh About National Automation Henderson, Nev.-based National Automation Services, Inc. (Pinksheets: NASV) -- http://www.nasautomation.com/-- is a holding company formed to acquire and operate specialized automation control companies located in the Southwestern United States. Currently, the Company owns 100% of the capital stock of two operating subsidiaries: (1) Intuitive Solutions, Inc., a Nevada corporation, based in Henderson, Nevada, and (2) Intecon, Inc., an Arizona corporation, based in Tempe, Arizona. The Company reported a net loss of $2.88 million on $1.95 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $4.88 million on $3.74 million of revenue during the prior year. As reported by the TCR on April 20, 2011, Lynda R. Keeton CPA, LLC, in Henderson, NV, expressed substantial doubt about the Company's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has working capital deficiencies and continued net losses. NNN 2003: Reports $12.26-Mil. Net Income in First Quarter --------------------------------------------------------- NNN 2003 Value Fund, LLC, filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting consolidated net income of $13.26 million on $0 of interest and dividend income for the three months ended March 31, 2011, compared with a consolidated net loss of $1.44 million on $12,000 of interest and dividend income for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $1.84 million in total assets, $1.14 million in total liabilities, and $696,000 in total equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/niDvUP About NNN 2003 Santa Ana, Calif.-based NNN 2003 Value Fund, LLC, was formed as a Delaware limited liability company on June 19, 2003. The Company was organized to acquire, own, operate and subsequently sell its ownership interests in a number of unspecified properties believed to have higher than average potential for capital appreciation, or value-added properties. Grubb & Ellis Realty Investors, LLC, serves as the Fund's manager, pursuant to the terms of an operating agreement. The Company reported a consolidated net loss of $493,000 on $6.85 million of rental revenue of operations held for non-sale disposition for the year ended Dec. 31, 2010, compared with a consolidated net loss of $9.09 million on $6.95 million of rental revenue of operations held for non-sale disposition during the prior year. Ernst & Young LLP, in its March 18, 2011 report accompanying the Form 10-K report, noted that the Company has incurred recurring losses and has a working capital deficiency. In addition, the Company has not complied with certain covenants of loan agreements and does not have sufficient cash flow to repay mortgage loans that are past due and in default. These conditions raise substantial doubt about the Company's ability to continue as a going concern. NORD RESOURCES: Incurs $2.27 Million First Quarter Net Loss ----------------------------------------------------------- Nord Resources Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $2.27 million on $4.75 million of net sales for the three months ended March 31, 2011, compared with net income of $1.01 million on $6.00 million of net sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $60.92 million in total assets, $60.98 million in total liabilities and a $56,548 total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/C7TXac About Nord Resources Based in Tuczon, Arizona, Nord Resources Corporation (TSX:NRD/OTCBB:NRDS.OB) -- http://www.nordresources.com/-- is a copper mining company whose primary asset is the Johnson Camp Mine, located approximately 65 miles east of Tucson, Arizona. Nord commenced mining new ore on February 1, 2009. Nedbank, the Company's senior lender, has declined to extend the forbearance agreement with respect to the scheduled principal and interest payment in the approximate amount of $2,150,000 that was due on March 31, 2010 under the Company's $25,000,000 secured term-loan credit facility with Nedbank. Nedbank Capital has also declined to extend the forbearance agreement regarding the Company's failure to make the payment of $697,869 due on April 6, 2010 under the Copper Hedge Agreement between the parties. Both forbearance agreements expired at midnight on May 13, 2010. The Company is now in default of its obligations under the Credit Agreement and the Copper Hedge Agreement with Nedbank. On June 2, 2010, Nord Resources appointed FTI Consulting to advise on refinancing structures and strategic alternatives. The Company reported a net loss of $21.20 million on $28.64 million of net sales for the year ended Dec. 31, 2010, compared with net income of $392,438 on $19.91 million of net sales during the prior year. As reported by the TCR on April 4, 2011, Mayer Hoffman McCann P.C., in Phoenix, Arizona, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted as of Dec. 31, 2010, and 2009, the Company reported a deficit in net working capital of $39,929,666 and $7,652,818, respectively. The Company's significant historical operating losses, lack of liquidity, and inability to make the requisite principal and interest payments due under the terms of the Company's credit agreement with its senior lender raise substantial doubt about the Company's ability to continue as a going concern, the auditors said. NORTEL NETWORKS: Posts $105 Million First Quarter Net Loss ---------------------------------------------------------- Nortel Networks Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $105 million for the three months ended March 31, 2011, compared with net income of $355 million for the same period last year. Revenues from continuing operations were $20 million in the first quarter of 2011 compared to $362 million for the first quarter of 2010, reflecting a reduction of 94.5% as a result of the business divestitures and the deconsolidation of the U.S. Debtors' subsidiaries. The net loss included interest expense of $79 million, other expense-net of $12 million, partially offset by other operating income of $25 million comprised primarily of billings under transition services agreements and reorganization items-net of $6 million. The net earnings in the first quarter of 2010 of $355 million included reorganization items of $496 million primarily related to the gain on the divestitures of the Optical Networking and Carrier Ethernet businesses and GSM/GSM-R business, other operating income of $60 million primarily of billings under transition services agreements, and other income-net of $60 million, comprised in part of a currency exchange gain of $44 million and rental income of $13 million. The cash balance as of March 31, 2011, was $775 million compared to a cash balance of $807 million as of Dec. 31, 2010, and restricted cash as of March 31, 2011, was $3.2 billion primarily related to the business divestiture proceeds. The cash balance was impacted by cash used in operating activities of $50 million partially offset by a net favorable foreign exchange impact of $9 million, and cash from investing activities of $9 million related to proceeds from the sale of the MSS business of $49 million, which was almost entirely offset by an increase in restricted cash of $40 million. The Company's balance sheet at March 31, 2011, showed $4.434 billion in total assets, $11.122 billion in total liabilities, and a stockholders' deficit of $6.688 billion. A copy of the Form 10-Q is available at http://is.gd/ZRaC0e A copy of the earnings release is available at http://is.gd/b3FSVo About Nortel Networks Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel Networks divested off key assets while in Chapter 11. So far, Nortel has raised $3.2 billion by selling its operations as it prepares to wind up a two-year liquidation due to insolvency. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. In June 2011, Nortel will auction off its remaining patent portfolio. Google Inc. is the lead bidder with a $900 million offer. NORTEL NETWORKS: Keightley & Ashner Okayed as Pension Counsel ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware to has approved Nortel Networks Inc.'s application to employ Keightley & Ashner LLP as special pension benefits counsel. During its retention, Keightley & Ashner employment will be limited to: 1. providing advice and guidance to the Debtors that will allow the Debtors to evaluate the PBGC's claims; 2. supporting Clearly Gottlieb in evaluating the PBGC's claims; and 3. Assisting Clearly Gottlieb in developing strategies to Resolve the PBGC's claims. Avant Advisory will charge the Debtors' estates in accordance with its customary hourly rates. The firm's hourly rates are: Personnel Hourly Rate --------- ---------- Attorneys $700 to $750 Other Professionals $550 to $600 Paralegals/Clerks $175 About Nortel Networks Nortel Networks Inc. (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel Networks divested off key assets while in Chapter 11. So far, Nortel has raised $3.2 billion by selling its operations as it prepares to wind up a two-year liquidation due to insolvency. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. In June 2011, Nortel will auction off its remaining patent portfolio. Google Inc. is the lead bidder with a $900 million offer. NORTEL NETWORKS: Settles With Israel Affiliate for $2 Million ------------------------------------------------------------- Vin Gurrieri at Bankruptcy Law360 reports that Nortel Networks Inc. and affiliate Nortel UK told a Delaware bankruptcy court Tuesday they had reached a $2 million settlement agreement with Nortel Israel, as the communications technology provider begins splitting money and allocating asset sale proceeds among its affiliates. According to Law360, NNI was hit earlier this month by a flood of claims from its European affiliates centered around "transfer pricing, intercompany dealings, trading and other agreements" with it, as well as mismanagement and breach of fiduciary allegations against company executives. About Nortel Networks Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel Networks divested off key assets while in Chapter 11. So far, Nortel has raised $3.2 billion by selling its operations as it prepares to wind up a two-year liquidation due to insolvency. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. In June 2011, Nortel will auction off its remaining patent portfolio. Google Inc. is the lead bidder with a $900 million offer. NPS PHARMACEUTICALS: Amendment to 2005 Incentive Plan Approved -------------------------------------------------------------- NPS Pharmaceuticals, Inc., on May 18, 2011, held its 2011 annual meeting of stockholders. At the annual meeting, the stockholders of NPS approved an amendment to the Company's 2005 Omnibus Incentive Plan to increase by 4,650,000 shares the aggregate number of shares of common stock reserved for issuance under the Omnibus Plan. The other material features of the Omnibus Plan were not affected by the amendment. The full text of the Omnibus Plan, as amended, is available for free at http://is.gd/FVdmHh On May 19, 2011, the Company filed a Certificate of Amendment of the Amended and Restated Certificate of Incorporation of the Company with the Secretary of State of the State of Delaware. The Certificate of Amendment amended the Company's Amended and Restated Certificate of Incorporation by increasing the number of authorized shares of the Company's common stock from 105,000,000 to 175,000,000 shares. Moreover, these nominees were elected to the Board of Directors of the Company: (1) Michael W. Bonney, B.A. (2) Colin Broom, M.D. (3) Pedro Granadillo, B.S. (4) James G. Groninger, M.B.A. (5) Donald E. Kuhla, Ph.D. (6) Francois Nader, M.D., M.B.A. (7) Rachel R. Selisker, CPA (8) Peter G. Tombros, M.S., M.B.A. These proposals were also approved at the Annual Meeting: (a) The advisory vote on executive compensation; (d) The conduct of future shareholder advisory votes every year on the compensation of the Company's named executive officers; and (e) The ratification of the appointment of KPMG LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2011. About NPS Pharmaceuticals Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq: NPSP) -- http://www.npsp.com/-- is developing new treatment options for patients with rare gastrointestinal and endocrine disorders. The Company's balance sheet at March 31, 2011, showed $158.27 million in total assets, $317.94 million in total liabilities and a $159.67 million total stockholders' deficit. The Company reported a consolidated net loss of $31.44 million on $89.41 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $17.86 million on $84.15 million of total revenue during the prior year. NPS noted in its Form 10-K for the year ended Dec. 31, 2009, it has not been profitable since its inception in 1986. As of Dec. 31, 2009, it had an accumulated deficit of $922.7 million. "Currently, we are not a self-sustaining business and certain economic, operational and strategic factors may require us to secure additional funds." The Company though believes its existing capital resources at Dec. 31, 2009, along with the receipt of $38.4 million from the sale of its REGPARA royalty stream, should be sufficient to fund its current and planned operations through at least Jan. 1, 2011. NUTRACEA: Posts $4.1 Million Net Loss in March 31 Quarter --------------------------------------------------------- NutraCea filed its quarterly report on Form 10-Q, reporting a net loss of $4.1 million on $8.0 million of revenues for the three months ended March 31, 2011, compared with a net loss of $3.3 million on $7.2 million of revenues for the same period last year. The increase in net loss was primarily due to an increase in warrant liability expense of $2.9 million which was partially offset by: (i) higher sales in the Bio-Refining segment, (ii) improved margins, (iii) lower selling, general and administrative expenses and (iv) recovery of a $740,000 accounts receivable, previously written off as uncollectible. The Company's balance sheet at March 31, 2011, showed $55.2 million in total assets, $28.7 million in total liabilities, $7.7 million in redeemable noncontrolling interest in Nutra SA, and stockholders' equity of $18.8 million. As reported in the TCR on April 6, 2011, BDO USA, LLP, in Phoenix, Arizona, expressed substantial doubt about NutraCea's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations resulting in an accumulated deficit of $184.8 million. "Also, in November 2009, the Company filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code. Although the Company emerged from bankruptcy in November 2010, there continues to be substantial doubt about its ability to continue as a going concern." A complete text of the Form 10-Q is available for free at: http://is.gd/yasUZI Scottsdale, Arizona-based NutraCea (NTRZ.pk) -- http://www.nutraceaonline.com/-- is a food ingredient and health company focused on the procurement, processing and refinement of rice bran and derivative products. The Company has proprietary intellectual property that allows it to process and convert rice bran, one of the world's most underutilized food resources, into a highly nutritious ingredient, stabilized rice bran (SRB) that has applications in various food products. Nutracea filed for Chapter 11 bankruptcy protection on Nov. 10, 2009 (Bankr. D. Ariz. Case No. 09-28817). NutraCea emerged from Chapter 11 bankruptcy protection effective Nov. 30, 2010. OPTIONS MEDIA: Salberg & Company Raises Going Concern Doubt ----------------------------------------------------------- Options Media Group Holdings, Inc., filed on May 17, 2011, its annual report on Form 10-K for the fiscal year ended Dec. 31, 2010. Salberg & Company, P.A., in Boca Raton, Florida, expressed substantial doubt about Options Media Group Holdings' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has a net loss of $9.86 million, and net cash used in operations of $2.02 million for the year ended Dec. 31, 2010, and a working capital deficit and an accumulated deficit of $524,157, and $22.74 million respectively at Dec. 31, 2010. The independent auditors noted that the Company has also discontinued certain operations. The Company reported a net loss of $9.86 million on $835,246 of revenues for 2010, compared with a net loss of $9.38 million on $1.61 million of revenues for 2009. The Company's balance sheet at Dec. 31, 2010, showed $3.13 million in total assets, $1.17 million in total liabilities, and stockholders' equity of $1.96 million. A copy of the Form 10-K is available at http://is.gd/VKlnIu Boca Raton, Fla.-based Options Media Group Holdings, Inc. has historically been an Internet marketing company providing e-mail services to corporate customers. Additionally, it contained a lead generation business and an SMS text messaging delivery business. In 2010, the Company transitioned by changing its focus to smartphones and developing a robust anti-texting program that prohibits persons in vehicles from texting and e-mailing while moving. As part of its focus on mobile software applications, the Company has also broadened its suite of products including obtaining a license to market mobile anti-virus software. In conjunction with this change of focus, in February 2011, the Company sold its e-mail and SMS businesses. The Company retains its lead generation business. Since the mobile software business did not generate any material revenue until March 31, 2011, the revenue consists almost solely of lead generation revenue. In conjunction with this change of focus, the Company is in the process of changing its name to PhoneGuard, Inc., and is currently soliciting consents from its key shareholders for that purpose. The Company's remaining business from its original business model is its lead generation business. The Company offers lead generation programs to assist a variety of businesses with customer acquisition for the products and services they are selling. The Company pre-screens the leads through its online surveys to meet its clients' exact criteria. Revenue from generating and selling leads to customers is recognized at the time of delivery and acceptance by the customer. ORANGE GROVE: Can Hire Jerome S. Cohen as Bankruptcy Counsel ------------------------------------------------------------ The U.S. Bankruptcy Court for the Central District of California authorized Orange Grove Service Inc. to employ Jerome S. Cohen as its bankruptcy counsel. As reported in the Troubled Company Reporter on March 15, 2011, Mr. Cohen will replace Ori S. Blumenfeld, Esq., at Wilson & Associates LLP. Mr. Cohen and his associates will be paid on an hourly basis: Professional Title Rate ------------ ----- ---- Jerome S. Cohen, Esq. Principal $450 Elaine V. Nguyen, Esq. Associate $300 Scott P. Layfield, Esq. Associate $300 William Gynan, Esq. Associate $300 Kim A. Bui, Esq. Associate $300 The Debtor agreed to pay a $25,000 initial deposit to cover early foreseeable fees and costs. On Feb. 10, the Debtor tendered to Mr. Cohen $30,000. Mr. Cohen will transfer $5,000 to a certified public accountant selected by the Debtor as a retainer for accounting services in the Debtor's case. The Cohen firm assured the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Orange Grove Service La Verne, California-based Orange Grove Service, Inc., owns and operates 2 "strip" shopping centers, the Lemon Creek in Walnut, Calif., and the Fremont, in Alhambra, Calif. The Company filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 10-21336) on March 25, 2010. Matthew Abbasi, Esq., at Wilson & Associates LLP, in Los Angeles, assists the Debtor in its restructuring effort. The Debtor tapped Hahn Fife & Company LLP, as its accountant to provide accounting services, and Michael R. Brown as special litigation counsel for state court and adversarial proceedings. The Debtor disclosed $12,003,736 in assets and $11,611,337 in liabilities as of the Chapter 11 filing. On Feb. 22, 2011, the Court denied, without prejudice, the Debtor's disclosure statement explaining the proposed plan of reorganization. The Plan proposes to pay creditors from the cash flow from rents generated by the operation of the Debtor's 2 strip shopping centers, the Lemon Creek in Walnut, California, and the Fremont Center in Alhambra, California. OSAGE EXPLORATION: Incurs $57,400 Net Loss in First Quarter ----------------------------------------------------------- Osage Exploration and Development, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $57,429 on $641,744 of total operating revenues for the three months ended March 31, 2011, compared with a net loss of $1.00 million on $424,763 of total operating revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $2.91 million in total assets, $1.66 million in total liabilities and $1.24 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/FDKqpM About Osage Exploration Based in San Diego, California with production offices in Oklahoma City, Oklahoma, and executive offices in Bogota, Colombia, Osage Exploration and Development, Inc. (OTC BB: OEDV) -- http://www.osageexploration.com/-- is an independent exploration and production company with interests in oil and gas wells and prospects in the US and Colombia. The Company reported a net loss $1.62 million on $1.83 million of total operating revenues for the year ended Dec. 31, 2010, compared with a net loss of $2.32 million on $2.81 million of total operating revenues during the prior year. GKM, LLP expressed substantial doubt about the Company's ability to continue as a going concern. GKM noted that the Company has suffered recurring losses from operations and has an accumulated deficit as of Dec. 31, 2010. OSSIS IRON: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Ossis Iron Works 4860 Cecile Avenue Las Vegas, NV 89115 Bankruptcy Case No.: 11-18292 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: Kent L. Ivey, Esq. IVEY FORSBERG & DOUGLAS 64 N. Pecos Road, #800 Henderson, NV 89074 Tel: (702) 990-6447 Fax: (702) 990-6445 E-mail: iveynet@earthlink.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 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nvb11-18292.pdf The petition was signed by Osvalda Ayala, president/owner. OUTSOURCE HOLDINGS: FBLB-Led Auction for Jefferson Bank on June 15 ------------------------------------------------------------------ The Hon. D. Michael Lynn of the U.S. Bankruptcy Court for the Northern District of Texas authorized Outsource Holdings, Inc., to conduct a sale process for 100% of the outstanding capital stock of Jefferson Bank. The Debtor relates that its only significant asset is it 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. The Debtor relates that a sale/merger of its interest in Jefferson Bank before August 2011 offers the best opportunity for maximizing the value of the asset for the estate and its creditors. However, the Debtor was unable to obtain consent from its creditors. Sheshuniff & Co. Investment Banking, L.P., as its investment banker and financial advisor, assisted the marketing efforts of the Debtor which resulted to: i) an acquisition agreement with First Bank Lubbock Bancshares, Inc. In exchange for the merger with Jefferson Bank and FBLB's affiliate -- First Bank & Trust, Lubbock, Texas -- FBLB will pay $2,021,000 in cash at closing, plus another $8,979,000 in cash within four years of closing; and ii) a purchase an assumption agreement with MidSouth Bank, N.A., a whole owned subsidiary of MidSouth Bancorp., FBLB and Jefferson Bank. Under the agreement, upon merger of First Bank & Trust and Jefferson Bank, MidSouth will buy certain assets from First Bank & Trust and Jefferson Bank for $11,600,000. MidSouth is buying majority of Jefferson Bank's assets. The Court approved the offer of FBLB as the stalking horse bid for the Debtor's interests in Jefferson Bank. The Debtor set a June 15 auction for the sale of the Debtor's interests in Jefferson Bank, at the offices of the Debtor's counsel at Forshey & Prostok, LLP, 777 Main Street, Suite 1290, Forth Worth, Texas. The Debor will conclude the negotiated sale process on June 20. Qualified bids are due June 10. The Court will consider the sale of the assets to FBLB or the winning bidder at a hearing on June 22, 2011, at 9:30 a.m. (prevailing Fort Worth, Texas time). Objections, if any, are due July 17, at 5:00 p.m. The Debtor is also authorized to pay expense reimbursement of up to $200,000, for the sale or use of the stock with the presence of a firm initial offer. The Court also directed the U.S. Trustee to appoint an examiner in the case. 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. The Debtor disclosed $10,571,121 in assets and $13,887,431 in liabilities as of the Chapter 11 filing. No creditors' committee has been appointed in the case. OUTSOURCE HOLDINGS: Taps Fenimore Kay Special Transaction Counsel ----------------------------------------------------------------- Outsource Holdings, Inc., asks the U.S. Bankruptcy Court for the Northern District of Texas for permission to employ Fenimore, Kay, Harrison & Ford, LLP as special transaction and regulatory counsel. Fenimore Kay will be assisting the Debtor in connection with the proposed transaction and in connection with all regulatory issues related thereto. The Debtor relates that its only significant asset is it 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. The Debtor believes that a sale/merger of its interest in Jefferson Bank before August 2011 offers the best opportunity for maximizing the value of the asset for the estate and its creditors. However, the Debtor was unable to obtain consent from its creditors. An investment banking firm assisted the marketing efforts of the Debtor which resulted to: i) an acquisition agreement with First Bank Lubbock Bancshares, Inc. In exchange for the merger with Jefferson Bank and FBLB's affiliate -- First Bank & Trust, Lubbock, Texas -- FBLB will pay $2,021,000 in cash at closing, plus another $8,979,000 in cash within four years of closing; and ii) a purchase an assumption agreement with MidSouth Bank, N.A., a whole owned subsidiary of MidSouth Bancorp., FBLB and Jefferson Bank. Under the agreement, upon merger of First Bank & Trust and Jefferson Bank, MidSouth will buy certain assets from First Bank & Trust and Jefferson Bank for $11,600,000. MidSouth is buying majority of Jefferson Bank's assets. The Debtor will use the FBLB and MidSouth offers as a stalking horse for other potential offers for the Debtor's interests in Jefferson Bank. The hourly rates of Fenimore Kay's personnel are: Geoffrey Kay $375 Associates $200 - $325 To the best of the Debtor's knowledge, Fenimore Kay is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. 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. The Debtor disclosed $10,571,121 in assets and $13,887,431 in liabilities as of the Chapter 11 filing. No creditors' committee has been appointed in the case. OXIGENE, INC: Incurs $863,000 Net Loss in First Quarter ------------------------------------------------------- OXiGENE, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $863,000 for the three months ended March 31, 2011, compared with a net loss of $11.02 million for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $3.85 million in total assets, $2.80 million in total liabilities, and $1.04 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/07qJNs About OXiGENE Inc. South San Francisco, Calif.-based OXiGENE (Nasdaq: OXGN) -- http://www.oxigene.com/-- is a clinical-stage biopharmaceutical company developing novel therapeutics to treat cancer and eye diseases. The Company reported a consolidated net loss of $23.77 million on $0 of license revenue for the year ended Dec. 31, 2010, compared with a consolidated net loss of $28.94 on $0 of license revenue during the prior year. As reported by the Troubled Company Reporter on March 23, 2011, Ernst & Young LLP, after auditing the Company's financial statements for the year ended Dec. 31, 2010, expressed substantial doubt about the Company's ability to continue as a going concern. Ernst & Young noted that the Company has incurred recurring operating losses and will be required to raise additional capital, alternative means of financial support, or both, prior to Jan. 1, 2012 in order to sustain operations. According to Ernst & Young, the ability of the Company to raise additional capital or alternative sources of financing is uncertain. PACIFICA MESA: Workers Sees Enterprise Value Drop, Withdraws Plan ----------------------------------------------------------------- Creditor Workers Realty Trust II, L.P., notified the U.S. Bankruptcy Court for the Central District of California of its withdrawal of its Plan of Reorganization for Pacifica Mesa Studios, LLC. Workers tells that Court that it will no longer pursue the confirmation of its Plan, and further advises the Court and parties-in-interest that it will not seek to have the Court approve the Disclosure Statement. Workers filed its competing Plan on March 25, 2011. Workers believed that the Plan was viable, based on, among other things, the opinions of its investment banker and financial consultant, Duff & Phelps Securities, LLC. For example, based on its review and analysis, Duff & Phelps had concluded that the Debtor had an estimated enterprise value of approximately $27.7 million. This value served as the basis for the terms of the Plan, including the treatment of Amalgamated Bank's secured claim against the Debtor. According to Workers, the Debtor's Plan seeks to eliminate Workers' claims and interests in the Debtor and its property (including Worker's senior lien on the New Markets Tax Credits proceeds) while granting 100% ownership of the Debtor to Amalgamated. After filing the Plan, Workers became concerned that its estimate of the Debtor's enterprise value was overly optimistic and must be adjusted downward. Significantly, on April 8, the State of New Mexico enacted a new cap on the state tax incentives that may be allocated to film productions in the state during any given year. The cap on film tax incentives takes effect July 1. Workers believes this development will discourage film companies from doing business in New Mexico, which will harm the Debtor's business and further reduce its enterprise value. On April 20, 2011, the Debtor and Amalgamated filed their objections to the Plan, making it clear that the Debtor and Amalgamated will resist Workers' Plan at all costs. Workers is represented by: POLSINELLI SHUGHART PC Jerry L. Switzer, Jr., Esq. Monika J. Machen, Esq. 161 N. Clark Street, Suite 4200 Chicago, IL 60601 Tel: (312) 819-1900 Fax: (312) 819 1910 E-mail: jswitzer@polsinelli.com mmachen@polsinelli.com BLANK ROME LLP Sara L. Chenetz, Esq. Peter F. Jazayeri, Esq. 1925 Century Park East, Suite 1900 Los Angeles, CA 90046 Tel: (424) 239-3400 Fax: (424) 239-3399 E-mail: chenetz@blankrome.com jazayeri@blankrome.com About Pacifica Mesa Agoura Hills, California-based Pacifica Mesa Studios, LLC, dba Albuquerque Studios and ABQ Studios, is a California limited liability company that was formed for the purpose of developing and running a state-of-the art production complex in Albuquerue, New Mexico. The Debtor is owned on a 50/50 basis by members Harold Katersky and Dana Arnold. The Debtor is the largest film studio in New Mexico. The Debtor filed for Chapter 11 bankruptcy protection on July 20, 2010 (Bankr. C.D. Calif. Case No. 10-18827). Steven T. Gubner, Esq., at Ezra Brutzkus & Gubner, assists the Debtor in its restructuring effort. The Debtor estimated $50 million to $100 million in assets and $100 million $500 million in liabilities in its Chapter 11 petition. PALM HARBOR: Wants Plan Exclusivity Until July 28 ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Palm Harbor Homes Inc., which sold its assets to Fleetwood Enterprises Inc. in April, is seeking a two-month extension of the exclusive right to propose a Chapter 11 plan. If the bankruptcy judge agrees at a July 22 hearing, the new deadline will be July 28. Palm Harbor said it is working to iron out problems in a plan. It didn't say what they are. About Palm Harbor Homes Addison, Texas-based Palm Harbor Homes, Inc. -- http://www.palmharbor.com/-- manufactured and marketed factory- built homes. The Company marketed nationwide through vertically integrated operations, encompassing manufactured and modular housing, financing and insurance. Palm Harbor, along with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 10-13850) on Nov. 29, 2010. It disclosed $321,263,000 in total assets and $280,343,000 in total debts. Brian Cejka at Alvarez & Marsal is the Debtors' chief restructuring officer. Raymond James and Associates, Inc., is the Debtors' investment banker. Alvarez & Marshal North America, LLC, is the Debtors' financial advisor. BMC Group, Inc., is the Debtors' claims agent. Pachulski Stang Ziehl & Jones LLP serves as counsel to the Official Committee of Unsecured Creditors. Following a court-approved sale process, Palm Harbor in March 2011 sold its business for $85.25 million to Fleetwood Enterprises Inc., a venture between Cavco Industries Inc. and a fund advised by Third Avenue Management LLC. Fleetwood is providing up to $55 million in secured financing for Palm Harbor's reorganization. As reported in the TCR on May 16, 2011, Cavco Industries and Fleetwood Homes filed with the U.S. Bankruptcy Court for the District of Delaware a motion for an order enforcing and ordering Palm Harbor Homes to perform its obligations under the Court- approved amended and restated asset purchase agreement and to pay administrative expenses. According to Cavco and Fleetwood, the Debtors ceased paying former employees' sales commissions and profit-sharing bonuses prior to the closing date when the individuals were still employees of the Debtors. PARK CENTRAL: Taps Grubb & Ellis as Real Property Leasing Agent --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Nevada authorized Park Central Plaza 32 LLC, to employ Grubb & Ellis Company as leasing agent for real property belonging to the estate. Grubb & Ellis will render all necessary listing, leasing and real estate services to Debtor. Grubb & Ellis will charge the Debtor a percentage based on the procurement of a tenant for the real property. Net lease terms provide for payment as: * 6% of the minimum guaranteed base rent for the first 60 months of the initial lease term; * 3% of the minimum guaranteed base rent for the second 60 months of the initial lease term if applicable. In the event Grubb & Ellis procures a buyer for the shopping center or any portion thereof Grubb & Ellis will be paid: * 6% of the gross sales price, 3% of which would provide co-op for outside broker. 5% of the gross sales if no outside broker. * Grubb & Ellis will be paid a commission of 1.5% in the event the Debtor sells the shopping center or any portion thereof to a principal that is not represented. To the best of the Debtor's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Park Central Las Vegas, Nevada-based Park Central Plaza 32, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11- 14153) on March 23, 2011. Greenberg Traurig LLP represents the Debtor in its restructuring effort. The Debtor tapped Matthew L. Johnson & Associates, P.C., as its special counsel, and Valuation Consultants as real estate appraiser. The Debtor estimated assets and debts at $10 million to $50 million. PARK CENTRAL: Taps Valuation Consultants as Real Estate Appraiser ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Nevada authorized Park Central Plaza 32 LLC, to employ Valuation Consultants as real estate appraiser. The Debtor will pay $7,000 to the firm for the appraisal and $350 per hour for the time Keith Harper spends preparing for and attending depositions and court hearings. To the best of the Debtor's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Park Central Las Vegas, Nevada-based Park Central Plaza 32, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11- 14153) on March 23, 2011. Greenberg Traurig LLP represents the Debtor in its restructuring effort. The Debtor tapped Matthew L. Johnson & Associates, P.C., as its special counsel, and Grubb & Ellis Company as leasing agent for real property belonging to the estate. The Debtor estimated assets and debts at $10 million to $50 million. PARKER BUILDING: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Parker Building LLC 434 State Street Schenectady, NY 12305 Bankruptcy Case No.: 11-11685 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court Northern District of New York (Albany) Judge: Robert E. Littlefield, Jr. Debtor's Counsel: Richard H. Weiskopf, Esq. O'CONNELL & ARONOWITZ 54 State Street, 9th Floor Albany, NY 12207 Tel: (518) 462-5601 Fax: (518) 462-2670 E-mail: rweiskopf@oalaw.com Scheduled Assets: $951,458 Scheduled Debts: $2,393,655 A list of the Company's nine largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nynb11-11685.pdf The petition was signed by Christopher J. Myers, managing member. PARKERVISION, INC: Incurs $3.4 Million First Quarter Net Loss ------------------------------------------------------------- ParkerVision, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $3.4 million on $0 revenue for the three months ended March 31, 2011, compared with a net loss of $3.9 million on $63,735 of revenue for the same period last year. The Company's balance sheet at March 31, 2011, showed $19.2 million in total assets, $1.3 million in total liabilities, and stockholders' equity of $17.9 million. As reported in the TCR on April 11, 2011, PricewaterhouseCoopers LLP, in Jacksonville, Florida, expressed substantial doubt about ParkerVision's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations. A copy of the Form 10-Q is available at http://is.gd/u9zbT5 Jacksonville, Fla.-based ParkerVision, Inc. (Nasdaq: PRKR) -- http://www.parkervision.com/-- designs, develops and markets its proprietary radio frequency technologies which enable advanced wireless communications for current and next generation mobile communications networks. PARMALAT SPA: 2nd Circ. Spares BofA from Investors' $300M Claim --------------------------------------------------------------- Samuel Howard at Bankruptcy Law360 reports that the Second Circuit on Friday found that Bank of America Corp. did not cause the $300 million in losses suffered by two special purpose entities that invested in Parmalat SpA, short-circuiting the Cayman Island entities' claim for breach of fiduciary duty. Affirming the lower court in a summary order, the Second Circuit shot down the SPEs' allegations that BofA breached its duty to the companies, holding that Parmalat's scandalous collapse in 2003 caused their losses, according to Law360. About Parmalat S.p.A. Headquartered in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/-- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on Dec. 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court declared the units insolvent. On June 22, 2004, Dr. Bondi, on behalf of the Italian entities, sought protection from U.S. creditors by filing a petition under Sec. 304 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 04-14268). Parmalat's U.S. operations filed for Chapter 11 protection on Feb. 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represented the U.S. Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Three special-purpose vehicles established by Parmalat S.p.A. -- Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. -- commenced separate winding up proceedings before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. were appointed liquidators in the cases. On Jan. 20, 2004, the Liquidators filed a Sec. 304 petition (Bankr. S.D.N.Y. Case No. 04-10362). Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represented the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presided over the Parmalat Debtors' U.S. cases and Sec. 304 cases. In 2007, Parmalat obtained a permanent injunction in the Sec. 304 cases. PERSIAN GALLERY: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Persian Gallery, Inc. 2860 Piedmont Road, N.E. Atlanta, GA 30305 Bankruptcy Case No.: 11-65633 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Paul Reece Marr, Esq. PAUL REECE MARR, P.C. 300 Galleria Parkway, N.W., Suite 960 Atlanta, GA 30339 Tel: (770) 984-2255 Fax: (770) 984-0044 E-mail: pmarr@mindspring.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/ganb11-65633.pdf The petition was signed by Mahmoud ("Mike") Govahi Kashani, CEO. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Mahmoud ("Mike") Govahi Kashani 11-63556 05/02/11 PETROLEUM & FRANCHISE: Proposes Downs as Special Counsel -------------------------------------------------------- Petroleum & Franchise Capital LLC asks U.S. Bankruptcy Court for the District of Connecticut for permission to employ Downs Rachlin Martin PLLC, which maintains an office for the practice of law at 28 Vernon Street, Suite 501, Brattleboro, Vt., to represent the Debtors as their Special Counsel to handle certain environmental insurance claims. As commercial finance lenders, the Debtors often obtain insurance policies which provide coverage for environmental contamination on real estate subject to mortgages which secure the portfolio obligations. The Debtors have a borrower who is in default and is currently in Chapter 11 Bankruptcy proceedings. There are numerous properties securing the obligations from this borrower which contain environmental contaminants and for which the Debtors have obtained environmental insurance. The Debtors obtained phase two studies of the subject properties and submitted claims to its carrier which have been denied. The Debtors believe the denials to be improper and are retaining the services of DRM to pursue their insurance claims. Downs Rachlin is experienced in environmental law and the related pursuit of insurance claims based on the type of environmental insurance policies obtained by the Debtors. Downs Rachlin will charge the Debtors for its legal services on an hourly basis in accordance with its ordinary and customary hourly rates in effect on the date services are rendered which are between $200/hr and $365/hr. The Debtors assure the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The hearing on the application to employ Downs Rachlin will be held on June 14, 2011, at 10:00 a.m. About Petroleum & Franchise Danbury, Connecticut-based Petroleum & Franchise Capital, LLC, and its affiliates are specialty commercial finance lenders, offering a premier array of long-term fixed rate financing products to experienced national and regional retail petroleum operators for new site development or acquisition, remodeling and construction financing for over a decade. Petroleum & Franchise Capital, LLC, filed for Chapter 11 bankruptcy protection on June 23, 2010, (Bankr. D. Conn. Case No. 10-1465). Craig I. Lifland, Esq., and James Berman, Esq., at Zeisler and Zeisler, assist the Company in its restructuring effort. BDO USA, LLP, serves as the Company's accountants. The Company estimated assets and debts at $50 million to $100 million. Petroleum & Franchise Funding, LLC, an affiliate of the Debtor, a filed separate Chapter 11 petition (Case No. 10-51467) on June 23, 2010, disclosing $66,132,915 in assets and $54,782,604 in liabilities as of the Chapter 11 filing. PLATINUM ENERGY: Tim Culp Discloses 7.9% Equity Stake ----------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Tim G. Culp disclosed that he beneficially owns 1,801,581 shares of common stock of Platinum Energy Resources, Inc., representing 7.9% of the shares outstanding. The percentages used is calculated based upon 22,606,476 shares of the common stock, par value $0.0001 per share, of Platinum Energy Resources, Inc., issued and outstanding as of April 13, 2011, as reported in the Company's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2010, which was filed with the Commission on April 15, 2011. A full-text copy of the filing is available for free at http://is.gd/EF3tgU About Platinum Energy Houston, Tex.-based Platinum Energy Resources, Inc. -- http://www.platenergy.com/-- is an independent oil and gas exploration and production company. The Company has approximately 37,000 acres under lease in relatively long-lived fields with well-established production histories. The properties properties are concentrated primarily in the Gulf Coast region in Texas, the Permian Basin in Texas and New Mexico, and the Fort Worth Basin in Texas. The Company reported reported a net loss of $5.13 million on $20.40 million of oil and gas sales for the year ended Dec. 31, 2010, compared with a net loss of $32.02 million on $17.30 million of oil and gas sales during the prior year. The Company's balance sheet at Dec. 31, 2010 showed $53.09 million in total assets, $23.73 million in total liabilities, not subject to compromise, $5.10 million in liabilities subject to compromise, related to assets held for sale-discontinued operations, and $24.26 million in total stockholders' equity. GBH CPAs, PC, in Houston, Texas, expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial statements for the year ended Dec. 31, 2009. The independent auditors noted that the Company has experienced significant losses since inception and is currently in default of its debt agreements. The Company has incurred significant losses, resulting in cumulative losses of $113,747,702 through Sept. 30, 2010. At Sept. 30, 2010, the Senior Credit Facility balance was approximately $5.15 million. The Company's current cash on hand of $2,395,820 is not adequate to satisfy the debt. Also, the Company has negative working capital of $8,168,992. Currently the Company is looking at various ways of correcting these issues, including exploring joint venture opportunities as well as a thorough analysis of our specific assets for potential divestiture. Further the Company has assets and liabilities that could be affected by unfavorable outcomes of litigation in progress. POINT BLANK: Equity Committee Can Hire Bifferato as Del. Counsel ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized the Official Committee of Equity Security Holders of Point Blank Solutions Inc., et al., to retain Bifferato LLC as its Delaware counsel. Bifferato will, among other things: -- participate in the formulation of a Plan; -- assist the Equity Committee in requesting the appointment of a trustee or examiner, if the action be necessary; and -- assist the Equity Committee in investigating the acts, conduct, assets, liabilities, and financial condition of the Debtor, the operation of the Debtor's business, potential claims, and any other, matters relevant to the cases or to the formulation of a plan of reorganization. The hourly rates of Bifferato's personnel are: Directors $345 - $700 Associates $225 - $385 Paralegal/Legal Assistants $150 - $200 To the best of the Equity Committee's knowledge, Bifferato is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-11255) on April 14, 2010. Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. T. Scott Avila of CRG Partners Group LLC is the restructuring officer. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. The Equity Committee has tapped Morrison Cohen LLP, Baker & McKenzie LLP, and The Bayard, P.A., as its counsel. Robert M. Hirsh, Esq., and Heike M. Vogel, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at Messana Rosner & Stern LLP, serve as co-counsel. POINT BLANK: Judge Stays Case Over Deregistration Plan ------------------------------------------------------ Lance Duroni at Bankruptcy Law360 reports that U.S. Bankruptcy Judge Peter J. Walsh on Wednesday halted a New York suit against the CEO of Point Blank Solutions Inc. over plans to deregister the company, saying the litigation could disrupt the body armor maker's reorganization at a delicate point in the case. Law360 relates that Judge Walsh issued a 90-day preliminary injunction against the suit, which takes issue with plans to deregister the company as an indirect condition of a settlement with the U.S. Securities and Exchange Commission on accounting fraud accusations. About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-11255) on April 14, 2010. Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. T. Scott Avila of CRG Partners Group LLC is the restructuring officer. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. The Equity Committee has tapped Morrison Cohen LLP, Baker & McKenzie LLP, and The Bayard, P.A., as its counsel. Robert M. Hirsh, Esq., and Heike M. Vogel, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at Messana Rosner & Stern LLP, serve as co-counsel. POLI-GOLD LLC: Can Access AZ Havasu Cash Collateral Until Sept. 30 ------------------------------------------------------------------ The Hon. Randolph J. Haines of the U.S. Bankruptcy Court for the District of Arizona has approved the stipulation authorizing Poli- Gold, LLC's continued interim use of the cash collateral of its secured lender AZ Havasu, LLC. The Debtor is authorized to use the cash collateral to pay ordinary, necessary, and essential postpetition operating expenses of its Panguitch Lake Resort until Sept. 30, 2011. The parties may further extend the Debtor's use of the cash collateral by agreement and without further order of the Court. Fort Mohave, Arizona-based Poli-Gold, LLC, owns a cabin and RV resort in Panguitch, Utah. It also owns a commercial building/warehouse/storage facility in Fort Mohave, Arizona, as well as a commercial property in Lake Havasu City, Arizona, and some vacant lots in Kingman, Arizona. Poli-Gold filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 10-37018) on Nov. 17, 2010. Attorneys at Engelman Berger, P.C., serve as the Debtor's bankruptcy counsel. Keller Williams River Cities Specialist serves as real estate listing broker. The Debtor disclosed assets of $30,384,943 and liabilities of $14,401,515 as of the petition date. PRECISION OPTICS: Incurs $302,300 Net Loss in Q3 Ended March 31 --------------------------------------------------------------- Precision Optics Corporation, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $302,312 on $495,423 of revenues for the three months ended March 31, 2011, compared with a net loss of $131,368 on $850,939 of revenues for the three months ended March 31, 2010. Total revenues for the nine months ended March 31, 2011, were $1.62 million, as compared to $2.16 million for the same period last year. During the nine months ended March 31, 2011, the Company incurred a net loss of $791,109 and used cash in operations of $392,852. During the nine months ended March 31, 2010, the Company incurred a net loss of $607,616 and used cash in operations of $61,450. The Company's balance sheet as of March 31, 2011, showed $1.33 million in total assets, $2.27 million in total liabilities, and a stockholders' deficit of $940,471. As reported in the TCR on Sept. 27, 2010, Stowe & Degon LLC, in Westborough, Mass., expressed substantial doubt about Precision Optics' ability to continue as a going concern, following the Company's results for the fiscal year ended June 30, 2010. The independent auditors noted that the Company has suffered recurring net losses and negative cash flows from operations. A copy of the Form 10-Q is available at http://is.gd/lCZzMe Headquartered in Gardner, Massachusetts, Precision Optics Corporation, Inc., has been a developer and manufacturer of advanced optical instruments since 1982. The Company designs and produces high-quality micro-optics, medical instruments and other advanced optical systems. The Company's medical instrumentation line includes laparoscopes, arthroscopes and endocouplers and a world-class product line of 3-D endoscopes for use in minimally invasive surgical procedures. PRIUM SPOKANE: Can Employ Berreth, Lochmiller as Accountants ------------------------------------------------------------ Prium Spokane Buildings, L.L.C., sought and obtained authority from the U.S. Bankruptcy Court for the Eastern District of Washington to employ Berreth, Lochmiller & Associates, PLLC, as accountants. Any actual award of compensation to the firm is subject to further Court order pursuant to Section 330 of the Bankruptcy Code and to any order establishing procedures for interim compensation and establishing fee and expense guidelines that may be entered. Bellevue, Washington-based Prium Spokane Buildings, L.L.C., filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wash. Case No. 10-06952) on Dec. 16, 2010. Davidson Backman Medeiros PLLC, represents the Debtor. There was no creditors committee appointed in the case. According to its schedules, the Debtor disclosed $17,042,743 in total assets and $34,723,584 in total debts. PURESPECTRUM, INC: Incurs $390,700 Net Loss in March 31 Quarter --------------------------------------------------------------- PureSpectrum, Inc., filed with the U.S. Securities and Exchange and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $390,742 on $25,682 for the three months ended March 31, 2011, compared with a net loss of $2.31 million on $9,079 of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $971,074 in total assets, $3.36 million in total liabilities, and a $2.39 million total stockholders' deficit. The Company has incurred net losses from operations of $390,742 for the three months ended March 31, 2011. In addition, at March 31, 2011, the Company has an accumulated deficit of $22,574,835 and negative working capital of $2,784,500. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern, according to the Form 10- Q. A full-text copy of the Form 10-Q is available for free at: http://is.gd/odLIzP About PureSpectrum, Inc. Savannah, Ga.-based PureSpectrum, Inc. (OTC: PSRU) -- http://www.purespectrumlighting.com/-- is engaged in the development, marketing, licensing, and contract manufacturing of lighting technology for use in residential, commercial, and industrial applications worldwide. The Company reported a net loss of $7.97 million on $79,634 of revenue for the year ended Dec. 31, 2010, compared with a net loss of $7.31 million on $12,490 of revenue during the prior year. QUALITY DISTRIBUTION: Seven Directors Elected at Annual Meeting --------------------------------------------------------------- Quality Distribution, Inc.'s 2011 annual meeting of shareholders was held on May 24, 2011. Of the 23,536,869 shares of common stock outstanding on the April 7, 2011, record date, a total of 21,033,339 shares of common stock were represented in person or by proxy. Seven nominees were elected to serve as directors to hold office until the next annual meeting of our shareholders or until their successors have been elected and qualified: (1) Kevin E. Crowe (2) Gary R. Enzor (3) Richard B. Marchese (4) Thomas R. Miklich (5) M. Ali Rashid (6) Alan H. Schumacher (7) Thomas M. White Stockholders also approved the ratification of the appointment of PricewaterhouseCoopers LLP as the Company's independent registered certified public accounting firm for 2011. About Quality Distribution Quality Distribution, LLC, and its parent holding company, Quality Distribution, Inc., are headquartered in Tampa, Florida. The company is a transporter of bulk liquid and dry bulk chemicals. The company's 2010 revenues are approximately $686 million. Apollo Management, L.P., owns roughly 30% of the common stock of Quality Distribution, Inc. The Company's balance sheet at March 31, 2011, showed $281.43 million in total assets, $405.83 million in total liabilities, and a $124.40 million total shareholders' deficit. * * * As reported by the Troubled Company Reporter on Feb. 18, 2011, Moody's Investors Service said the $38 million public offering of 4 million shares of Quality Distribution's common stock on Feb. 9, 2011, does not affect Quality's 'Caa1' corporate family and probability of default ratings with a positive outlook. However, Moody's notes that the intended debt reduction at par from $17.5 million of the proceeds would be viewed favorably. In the Nov. 8, 2010 edition of the TCR, Standard & Poor's Ratings Services said that it has raised its corporate credit ratings on U.S.-based Quality Distribution Inc. to 'B' from 'B-'. S&P also removed the ratings from CreditWatch, where S&P had placed them with positive implications on Oct. 28, 2010, following the launch of the bond offering. The outlook is stable. "The rating action reflects the improvement in Quality Distribution's financial profile after completing its refinancing," said Standard & Poor's credit analyst Anita Ogbara. "Following the transaction, S&P expects Quality Distribution to benefit from lower interest expense, improved cash flow adequacy, and a substantial reduction in debt maturities over the next few years." QUAMTEL, INC: Posts $679,100 Net Loss in First Quarter ------------------------------------------------------ Quamtel, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $679,090 on $428,010 of revenues for the three months ended March 31, 2011, compared with a net loss of $869,439 on $703,748 of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.9 million in total assets, $5.0 million in total liabilities, and a stockholders' deficit of $3.1 million. RBSM LLP, in New York, expressed substantial doubt about Quamtel's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred significant operating losses in the current year and also in the past. A copy of the Form 10-Q is available at http://is.gd/qHgMjM The Company reported a net loss of $10.0 million on $2.2 million of revenues for 2010, compared with a net loss of $1.9 million on $2.5 million of revenues for 2009. The Company's balance sheet at Dec. 31, 2010, showed $2.0 million in total assets, $4.8 million in total liabilities, and a stockholders' deficit of $2.8 million. A copy of the Form 10-K is available at http://is.gd/dwUbfK Based in Dallas, Quamtel, Inc., provides prepaid and postpaid enhanced telecommunications services with an emphasis on transporting calls that originate from the United States and Canada and terminate in other specific regions of the world. QUIGLEY CO: Court Lacks Power to Halt Pfizer Asbestos Claims ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Pfizer Inc. lost an appeal in the reorganization of its non-operating subsidiary Quigley Co. when a federal judge ruled that the drugmaker isn't entitled to protection from some asbestos claims under the umbrella of Quigley's Chapter 11 case. According to the report, the May 20 opinion by U.S. District Judge Richard Holwell in New York dealt with only one Quigley product, Insulag, and only affects asbestos claims governed by Pennsylvania law or states with similar laws. Under a settlement reached while the appeal was pending, many asbestos claimants have already resolved their disputes with Quigley and Pfizer. The "decision has limited implications," said Edward Weisfelner of Brown Rudnick LLP in New York, who represents an ad hoc committee of three law firms representing asbestos claimants, according to Mr. Rochelle's report. "Our clients have reached a settlement with Pfizer and a goodly percentage of all asbestos lawyers had reached a settlement years ago that would preclude them from pursuing this theory." Mr. Rochelle notes that under Section 524 of the Bankruptcy Code, third parties can sometimes piggyback a company in Chapter 11 and receive absolution from asbestos claims without being in bankruptcy. Judge Holwell ruled that the provision doesn't apply to Pfizer regarding Insulag claims under Pennsylvania law. Mr. Rochelle explains that Judge Holwell said Pfizer's liability arose "out of its sponsorship of a defective product, not its corporate affiliation" with Quigley. As a result, Judge Holwell reversed the bankruptcy judge and ruled that the asbestos claimants have the right to bring suits directly against Pfizer. There was no power under bankruptcy law to use Quigley's bankruptcy to stop suits against Pfizer, Judge Holwell said. An injunction against Pfizer suits was "beyond the jurisdiction of a bankruptcy court," he said. Judge Holwell didn't rule that Pfizer is liable on Quigley asbestos claims. Pfizer "has never been held derivatively liable for actions of Quigley," the New York-based company said in an emailed statement. It disagrees with the ruling and "will seek clarification from the district court," Pfizer said. Asbestos claimants were appealing an injunction by the bankruptcy judge earlier in the case stopping suits against Pfizer. Amid the appeal, the bankruptcy judge in April approved a so-called plan- support agreement designed to end the Quigley case after more than six years. The settlement was reached with an ad hoc committee representing 40,000 asbestos claimants contending they were injured by Quigley products. Quigley has a June 7 hearing for approval of a disclosure statement explaining the settlement and treatment of asbestos claimants under the Chapter 11 plan. Pfizer has "requested a short extension of the bankruptcy proceedings," according to the company's statement. The settlement headed off a hearing to have been held in April where the ad hoc committee would have sought dismissal of the Quigley reorganization begun in September 2004. The motion to dismiss resulted from a ruling by the bankruptcy judge in September refusing to confirm Quigley's prior reorganization plan. About Quigley Co. Quigley Co. was acquired by Pfizer in 1968 and sold small amounts of products containing asbestos until the early 1970s. In September 2004, Pfizer and Quigley took steps that were intended to resolve all pending and future claims against the Company and Quigley in which the claimants allege personal injury from exposure to Quigley products containing asbestos, silica or mixed dust. Quigley filed for bankruptcy in 2004 and has a Chapter 11 plan and a settlement with Chrysler. Quigley filed for Chapter 11 bankruptcy protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to implement a proposed global resolution of all pending and future asbestos-related personal injury liabilities. Lawrence V. Gelber, Esq., and Michael L. Cook, Esq., at Schulte Roth & Zabel LLP, represent the Debtor in its restructuring efforts. Elihu Inselbuchm Esq., at Caplin & Drysdale, Chartered, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it disclosed $155,187,000 in total assets and $141,933,000 in total debts. R & R PLAZA: Case Summary & 14 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: R & R Plaza, LLC 338 President Street Saddle Brook, NJ 07663 Bankruptcy Case No.: 11-26482 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court District of New Jersey (Newark) Judge: Morris Stern Debtor's Counsel: David Edelberg, Esq. NOWELL AMOROSO KLEIN BIERMAN, P.A. 155 Polifly Road Hackensack, NJ 07601 Tel: (201) 343-5001 Fax: (201) 343-5181 E-mail: dedelberg@njbankruptcy.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 14 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/njb11-26482.pdf The petition was signed by Raymond Plaza, managing member. RADIENT PHARMACEUTICALS: Incurs $85.71 Million Net Loss in 2010 --------------------------------------------------------------- Radient Pharmaceuticals Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K, reporting a net loss of $85.71 million on $231,662 of net revenues for the year ended Dec. 31, 2010, compared with a net loss of $16.62 million on $8.62 million of net revenues during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $856,960 in total assets, $53.75 million in total liabilities and a $52.89 million total stockholders' deficit. KMJ Corbin & Company LLP, in Costa Mesa, California, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant operating losses, had negative cash flows from operations in 2010 and 2009, and has a working capital deficit of approximately $53 million at Dec. 31, 2010. A full-text copy of the Form 10-K is available for free at: http://is.gd/GIgknS About Radient Pharmaceuticals Headquartered in Tustin, Calif., Radient Pharmaceuticals Corporation -- http://www.Radient-Pharma.com/-- is engaged in the research, development, manufacturing, sale and marketing of its ONKO-SURE(TM) a proprietary IVD Cancer Test in the United States, Canada, China, Chile, Europe, India, Korea, Taiwan, Vietnam and other markets throughout the world. Radient said in October 2010 it incurred a trigger event on the 12% Convertible Notes issued in first and second quarter of 2010 due to its failure to have the related registration statement declared effective by June 1, 2010. The Company filed on Sept. 7, 2010, an Event of Default under those same notes occurred since it did not hold the related shareholder meeting by Aug. 31, 2010. RADIENT PHARMACEUTICALS: Expects to Report $10MM-$12MM Loss in Q1 ----------------------------------------------------------------- Radient Pharmaceuticals Corporation anticipates filing its Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, on or before the close of business on Tuesday, June 7, 2011. In the Form 10-Q, the Company expects to report revenues of approximately $31,000 and a net loss in the range of $10.6 to $12 million compared with net loss of approximately $2.6 million for the three months ended March 31, 2010. The Company also expects to report stockholders deficit in the range of approximately $13.6 to $15.0 million for the quarter ended March 31, 2011, as compared to a deficit of approximately $52.9 million for the quarter ended March 31, 2010. About Radient Pharmaceuticals Headquartered in Tustin, Calif., Radient Pharmaceuticals Corporation -- http://www.Radient-Pharma.com/-- is engaged in the research, development, manufacturing, sale and marketing of its ONKO-SURE(TM) a proprietary IVD Cancer Test in the United States, Canada, China, Chile, Europe, India, Korea, Taiwan, Vietnam and other markets throughout the world. Radient said in October 2010 it incurred a trigger event on the 12% Convertible Notes issued in first and second quarter of 2010 due to its failure to have the related registration statement declared effective by June 1, 2010. The Company filed on Sept. 7, 2010, an Event of Default under those same notes occurred since it did not hold the related shareholder meeting by Aug. 31, 2010. The Company reported a net loss of $85.71 million on $231,662 of net revenues for the year ended Dec. 31, 2010, compared with a net loss of $16.62 million on $8.62 million of net revenues during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $856,960 in total assets, $53.75 million in total liabilities and a $52.89 million total stockholders' deficit. KMJ Corbin & Company LLP, in Costa Mesa, California, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant operating losses, had negative cash flows from operations in 2010 and 2009, and has a working capital deficit of approximately $53 million at Dec. 31, 2010. RADIO ONE: Doyle Mitchell Resigns from Board of Directors --------------------------------------------------------- Prior to the 2011 annual meeting of stockholders, B. Doyle Mitchell, Jr., submitted his resignation from the Board of Directors of Radio One, Inc., including a prospective resignation if he were re-elected at the 2011 Meeting to serve until the 2012 annual meeting of stockholders. On May 18, 2011, in accordance with Radio One, Inc.'s bylaws, the Board appointed Dennis Miller as a Class B director to serve until the 2012 Meeting or until his successor is duly elected and qualified. Mr. Miller's qualifications to serve as a director include his knowledge of TV One, his many years of senior management experience at various public and private media enterprises, and his knowledge of new media enterprises. Mr. Miller currently serves as a General Partner with Spark Capital, LLC, a venture fund with an investment focus on the conflux of the media, entertainment and technology industries. Prior to joining Spark Capital in 2005, Mr. Miller was a Managing Director of Constellation Ventures, the venture investment arm of Bear Stearns. His portfolio of investments has included TV One, College Sports Television (acquired by CBS), Widevine (acquired by Google), K12 taken public in 2008 (NYSE:LRN), Next New Networks (acquired by Google) and The Gospel Channel. He also served on the Board of Directors of Capital IQ (acquired by McGraw-Hill). From 1998 to 2000, Mr. Miller was Executive Vice President of Lions Gate Entertainment. Prior to joining Lions Gate, he was an Executive Vice President with Sony Pictures Entertainment where he was responsible for all television operations of SPE and actively involved with strategic planning and new media. From 1990 to 1995, Mr. Miller was Executive Vice President of Turner Network Television. In 1993, he took on the additional responsibility for the Turner Entertainment Company. Mr. Miller began his career as an attorney with Manatt, Phelps, Rothenberg and Phillips in Los Angeles. He holds a Juris Doctorate from Boalt Law School and a B.A. in political science from the University of California at San Diego. As of April 4, 2011, the date of the Company's proxy statement, the compensation committee of the Board had not made any determinations with respect to 2010 bonuses for the Company's named executive officers. On May 18, 2011, the Committee made final determinations with respect to 2010 Executive Bonuses. These proposals were approved by the stockholders at the 2011 Annual Meeting of Stockholders held on May 18, 2011: * The election of Terry L. Jones and Brian W. McNeill as Class A directors to serve until the 2012 annual meeting of stockholders or until their successors are duly elected and qualified. * The election of Catherine L. Hughes, Alfred C. Liggins, III, D. Geoffrey Armstrong, and Ronald E. Blaylock as directors to serve until the 2012 annual meeting of stockholders or until their successors are duly elected and qualified. * The ratification of Ernst & Young LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2011. About Radio One Based in Washington, Radio One, Inc. (Nasdaq: ROIAK and ROIA) -- http://www.radio-one.com/-- is a diversified media company that primarily targets African-American and urban consumers. The Company is one of the nation's largest radio broadcasting companies, currently owning 53 broadcast stations located in 16 urban markets in the United States. Radio One operates syndicated programming including the Russ Parr Morning Show, the Yolanda Adams Morning Show, the Rickey Smiley Morning Show, CoCo Brother Live, CoCo Brother's "Spirit" program, Bishop T.D. Jakes' "Empowering Moments", the Reverend Al Sharpton Show, and the Warren Ballentine Show. The Company also owns a controlling interest in Reach Media, Inc. -- http://www.blackamericaweb.com/-- owner of the Tom Joyner Morning Show and other businesses associated with Tom Joyner. Radio One owns Interactive One -- http://www.interactiveone.com/ -- an online platform serving the African-American community through social content, news, information, and entertainment, which operates a number of branded sites, including News One, UrbanDaily, HelloBeautiful, Community Connect Inc. -- http://www.communityconnect.com/-- an online social networking company, which operates a number of branded Web sites, including BlackPlanet, MiGente, and Asian Avenue and an interest in TV One, LLC -- http://www.tvoneonline.com/-- a cable/satellite network programming primarily to African-Americans. The Company reported a net loss of $26.62 million on $279.90 million of net revenue for the year ended Dec. 31, 2010, compared with a net loss of $48.55 million on $272.09 million of net revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $1.00 billion in total assets, $844.13 million in total liabilities, $31.26 million in redeemable non-controlling interests, and $132.02 million in total stockholders' equity. In its report dated Aug. 23, 2010, for the Company's fiscal 2009 financial statements, Ernst & Young LLP expressed substantial doubt as to the Company's ability to continue as a going concern, given certain covenant violations under the Company's loan agreements which could have resulted in significant portions of the Company's outstanding debt becoming callable by the Company's lenders. The Company noted that these violations were cured as a part of certain refinancing transactions more fully described in our Current Report on Form 8-K filed, Dec. 1, 2010. Having cured these violations, the Company's audited financial statements for 2010 have been prepared assuming that it will continue as a going concern. * * * In the Dec. 10, 2010 edition of the TCR, Moody's confirmed the Caa1 rating for Radio One, Inc.'s Corporate Family Rating and confirmed its Caa2/LD Probability of Default Rating. According to Moody's, the Caa1 corporate family rating will reflect Radio One's high pro forma debt-to-EBITDA leverage of approximately 8.0x (incorporating Moody's standard adjustments) mitigated by improved operating performance due to expected political advertising gains in 4Q10 followed by double digit EBITDA gains in 1Q11 compared to a weak 1Q10. Despite expected growth in EBITDA and improving debt-to-EBITDA leverage ratios, reported debt balances will remain flat at approximately $655 million for the next 12 months due to the anticipated funding of the TV One capital call as well as the potential accretion of the PIK portion of the new 12.5%/15% subordinated notes due 2016. As reported by the Troubled Company Reporter on March 11, 2011, Standard & Poor's Ratings Services said it raised its long-term corporate credit rating on U.S. radio broadcaster Radio One Inc. to 'B-' from 'CCC+'. The rating outlook is stable. "The 'B-' rating and stable outlook reflect S&P's view that the proposed transaction will improve Radio One's financial flexibility by eliminating near-term refinancing risk and increasing headroom under financial covenants," said Standard & Poor's credit analyst Michael Altberg. "Going forward, S&P believes the company's increased ownership in TV One LLC, a growing African American-targeted cable TV network, provides additional diversity to Radio One's business profile and access to a more stable revenue stream." RENASCENT, INC: Taps John Amsden for Claim vs. Thornburg -------------------------------------------------------- Renascent, Inc., sought and obtained authority from the U.S. Bankruptcy Court for the District of Montana to employ: John Amsden, Esq. BINNEY LAW FIRM, P.C. P.O. Box 2253 Missoula, Montana 59806-2253 Tel: (406) 541-8020 Fax: (406) 541-8006 E-Mail: jon@binneylaw.com as special counsel to represent the Debtor in its claims against Thornburg Mortgage Securities Trust 2007-3; BAC Home Loan Servicing, LP; Countrywide Home Loans, Inc.; Wells Fargo; and any or all persons, known or unknown, claiming or who might claim any right, title, estate, or interest in or lien or encumbrance upon the real property. The Debtor will pay Mr. Amsden a 1/3 (one-third) contingency fee. John Amsden, Esq., at Binney Law, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Renascent, Inc Victor, Montana-based Renascent, Inc, filed for Chapter 11 bankruptcy protection (Bankr. D. Mont. Case No. 10-62358) on Sept. 29, 2010. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million as of the Petition Date. Jon R. Binney, Esq., who has an office in Missoula, Montana, serves as bankruptcy counsel to the Debtor. David Markette and Dustin Chouinard as serves as the Debtor's special counsel. RICHARD LIND: Deutsche Bank Has Green Light to Amend Claim ---------------------------------------------------------- Bankruptcy Chief Judge Thomas L. Saladino authorized Deutsche Bank National Trust Company to file an amended proof of claim in the bankruptcy case of Richard H. Lind and Christine M. Lind, over the objection of Omaha State Bank. Deutsche Bank seeks to file a second amended proof of claim. The proof of claim deadline in the case was Feb. 21, 2010. Deutsche Bank timely filed its original proof of claim as a creditor secured by Debtors' residence on Nov. 10, 2009, for $379,468.54. On March 2, 2011, Deutsche Bank filed another amended proof of claim, this time for $465,639.78, to add additional interest through Nov. 10, 2010, and include late charges and bankruptcy fees. Omaha State Bank holds a lien in the sale proceeds junior to that of Deutsche Bank. Omaha State Bank points out that the property securing the claims was sold free and clear of liens pursuant to a motion filed by the Debtors and the net proceeds of the sale -- $551,237.28 -- were paid into the registry of the court pending distribution to the secured creditors. Omaha State Bank argues that in consenting to the sale of the property, it relied upon the proof of claim of record in November 2010, and that it is prejudiced by the substantial increases Deutsche Bank is now asking for its claim. Omaha State Bank also argues that Deutsche Bank should not be allowed to include its bankruptcy, foreclosure, and other fees. Omaha State Bank believes that Deutsche Bank should only be entitled to its principal and interest as set forth in Deutsche Bank's treatment under Debtors' confirmed plan. Judge Saladino said Deutsche Bank is entitled to amend its proof of claim, and gave Deutsche Bank until June 3, 2011, to file an affidavit which details its calculation of interest and its asserted escrow advances that it wishes to be included, as well as any other amounts that it wishes to be included in its proof of claim. Omaha State Bank will have until June 10, 2011, to object. Judge Saladino encouraged Omaha State Bank, Deutsche Bank, and the Debtors to work together on a potential stipulation that would allow undisputed amounts -- such as the principal balance, among others -- to be disbursed to Deutsche Bank to prevent the further accrual of interest. A copy of the Court's May 26, 2011 Order is available at http://is.gd/jaMgnnfrom Leagle.com. Richard H. Lind and Christine M. Lind filed for Chapter 11 bankruptcy (Bankr. D. Neb. Case No. 09-82915) on Oct. 29, 2009. RICKY MURRAY: Has Green Light to Use BB&T's Cash Collateral ----------------------------------------------------------- Bankruptcy Judge Stephani W. Humrickhouse authorized Ricky V. Murray and Connie B. Murray to use the cash collateral securing their obligations to Branch Banking & Trust Co. The Court further held that prior to the hearing set for June 8, 2011 on BB&T's motion for relief from the stay or for adequate protection, the Debtors are directed to pay to BB&T adequate protection payments of $8,008.39 per month for the months of February, March, April, May and June 2011. A determination of adequate protection payments after June 2011 will be made in conjunction with the stay hearing. A copy of the Court's May 24, 2011 Order is available at http://is.gd/GH8Twffrom Leagle.com. Ricky V. Murray and Connie B. Murray are members and principals of three North Carolina limited liability companies -- Related Entities -- engaged in the business of owning and renting real estate, and a corporation known as Lisa Dee's Florist, Inc. Two of the LLCs were administratively dissolved by the North Carolina Secretary of State in February 2009. In September 2010, lender BB&T initiated foreclosure proceedings and on Dec. 1, 2010, the day of the foreclosure sale, the Related Entities transferred to the Murrays all of the Related Entities' interests in the real property subject to BB&T's security interests. The properties were transferred for nominal consideration. The Murrays filed a Chapter 11 petition (Bankr. E.D.N.C. Case No. 10-10143) on Dec. 10, 2010. On May 1, 2011, BB&T filed an adversary proceeding against the Debtors and the Related Entities in which it asserts claims arising out of the Related Entities' transfers of the properties to the Debtors. RIDGERUNNER LLC: Bauer & French Pay Terms Violate Bankruptcy Code ----------------------------------------------------------------- Chief Bankruptcy Judge Terry L. Myers denied the request of Ridgerunner LLC to employ Bauer & French as attorneys. The Court rejected the attempted use of an "advance payment retainer" as a means of allowing Counsel to be employed and to obtain compensation for post-petition services without compliance with Bankruptcy Code Sections 330 and 331. The Court also rejected the proposition that the advance payment of fees authorized Counsel to immediately deposit amounts in its general business or operating account as opposed to placing them in a client trust account in accord with applicable requirements of the Idaho Rules of Professional Conduct. On April 1, 2011, Counsel filed a Rule 2016(b) disclosure indicating that it had received $8,539 prior to the filing of the case, of which $1,039 was used to pay the Debtor's filing fee, and $7,500 of which was an "advance payment retainer." A copy of the Court's May 26, 2011 Memorandum of Decision is available at http://is.gd/ZlM1Vifrom Leagle.com. Judge Myers also denied an application by other debtor entities, KM Allied of Nampa, LLC (Bankr. D. Idaho Case No. 10-03056) and Leslie and Terriann Danner (Bankr. D. Idaho Case No. 11-00651), to employ Bauer & French as counsel, in view of the compensation structure. Ridgerunner LLC filed for Chapter 11 bankruptcy relief (Bankr. D. Idaho Case No. 11-20369) on April 1, 2011, listing under $1 million in both assets and debts. A copy of Ridgerunner's petition is available at http://bankrupt.com/misc/idb11-20369.pdf RIVER ROCK: Reports $7.18 Million Income in March 31 Quarter ------------------------------------------------------------ River Rock Entertainment Authority filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting income before distributions to tribe of $7.18 million on $31.88 million of gross revenues for the three month-period ended March 31, 2011, compared with income before distributions to tribe of $7.28 million on $32.63 million of gross revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $229.83 million in total assets, $219.38 million in total liabilities, all current, and $10.45 million in total net assets. A full-text copy of the Form 10-Q is available for free at: http://is.gd/G9MDRA About River Rock Headquartered in Geyserville, California, River Rock Entertainment Authority is a governmental instrumentality of the Dry Creek Rancheria Band of Pomo Indians, a federally recognized Indian tribe. River Rock Casino is a governmental development project of the Authority. The Casino offers Class III slot and video poker gaming machines, house banked table games, including Blackjack, Three card poker, Mini-baccarat and Pai Gow poker, Poker, featuring Texas Hold' em, comprehensive food and non-alcoholic beverage offerings, and goods for sale on tribal land located in Geyserville, California. As reported by the TCR on March 18, 2011, Moody's Investors Service downgraded River Rock Entertainment Authority's Corporate Family Rating and Probability of Default Rating to Caa1 from B2, and the rating on the $200 million senior notes due 2011 to Caa1 from B2. All ratings are kept under review for further possible downgrade. The downgrade of CFR to Caa1 reflects the significant refinancing risk stemming from upcoming maturity of RREA's $200 million senior notes on Nov. 1, 2011 and lack of evidence that the Authority has made meaningful progress in addressing the maturity since its ratings were initially placed under review for possible downgrade in October 2010. In the Dec. 13, 2010 edition of the Troubled Company Reporter, Standard & Poor's Ratings Services lowered its ratings on Sonoma County, California-based River Rock Entertainment Authority; the issuer credit rating was lowered to 'B-' from 'B+'. At the same time, S&P placed the ratings on CreditWatch with negative implications. RREA was created to operate the River Rock casino for the Dry Creek Rancheria Band of Pomo Indians (the Tribe). "The rating downgrade and CreditWatch listing reflect River Rock's limited progress in addressing near-term refinancing needs associated with its $200 million senior notes due November 2011, as well as other debt held at the Tribe," said Standard & Poor's credit analyst Michael Halchak. "With less than 12 months to the maturity on the senior notes, S&P has become increasingly concerned around River Rock's ability to successfully address these refinancing needs. In addition, S&P believes River Rock faces additional liquidity needs related to the Tribe's memorandum of agreement with Sonoma County, associated with infrastructure spending needs in and around the casino." ROBERT BRYANT: Dolins Awarded $1,800 in Attorney Fees ----------------------------------------------------- Bankruptcy Judge Michael E. Romero awarded Robert Alan Dolin and Lisa Dolin $1,800 in attorney fees (6 hours x $300 = $1800) and $8.25 for expenses incurred in obtaining order compelling completion of Robert Olan Bryant's deposition. A copy of the Court's May 25 order is available at http://is.gd/cFSv4Wfrom Leagle.com. Robert Olan Bryant was convicted of securities fraud and owed $8.8 million to victims, according to a September 2009 report by The Denver Post. Mr. Bryant is a Chapter 11 debtor (Bankr. D. Colo. Case No. 07-10832). ROCKY MOUNTAIN: Case Summary & 7 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Rocky Mountain Truss Co., LLC 2445 US Highway 2 NE Havre, MT 59501 Bankruptcy Case No.: 11-61058 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court District of Montana (Butte) Debtor's Counsel: Steven M. Johnson, Esq. CHURCH HARRIS JOHNSON & WILLIAMS PC P.O. Box 1645 Great Falls, MT 59403 Tel: (406) 761-3000 E-mail: sjohnson@chjw.com Scheduled Assets: $164,398 Scheduled Debts: $1,749,229 A list of the Company's seven largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/mtb11-61058.pdf The petition was signed by Jesse Lohse, partner. RUGGED BEAR: Could Reopen Next Year; Franchisee Keeps 2 Stores -------------------------------------------------------------- Jon Chesto, writing for the Mass. Market section at the Wicked Local Network, reports that fans of the now-defunct Rugged Bear children's clothing chain can either wait for the brand to be revived next year -- or they can drive to Beverly and West Lebanon, N.H., where the only two franchised Rugged Bear stores remain open under a new name. Franchisees Brad and Megan Greenwood decided to keep the stores open -- under the name C&C Kids -- despite the closing of the parent company. The Rugged Bear brand, meanwhile, was bought by another group of investors who plan on bringing the Bear out of hibernation next year, at least as an online outlet. About The Rugged Bear Headquartered in Norwood, Massachusetts, The Rugged Bear Company is a chain of retail children's clothing stores New England, New York and New Jersey. It filed for Chapter 11 bankruptcy protection (Bankr. D. Mass. Case No. 11-10577) on Jan. 25, 2011. Charles A. Dale, III, Esq., at K&L GATES LLP, serves as the Debtor's bankruptcy counsel. Consensus Advisers, LLC, is the Debtor's financial advisor. RUSSELL SUTHERLAND: Untimely Plan Prompts Case Dismissal -------------------------------------------------------- Bankruptcy Judge Michael E. Romero dismissed Russell D. Sutherland's Chapter 11 case after he failed to timely file a plan of reorganization and disclosure statement. The Debtor had asked the Court decline to dismiss or convert the case and treat his Plan of Reorganization, dated Feb. 11, 2011 as timely filed pursuant to the 300-day deadline in 11 U.S.C. Sec. 1121(e)(2). That plan was filed 311 days after the petition date and 254 days after the conversion date. Further, on Feb. 25, 2011, the Court ordered the Feb. 11, 2011 Plan "stricken" because the Plan was deficient and the Debtor failed to comply with L.B.R. 3017-2. According to Judge Romero, the 300-day deadline is a "drop dead" provision, citing similar rulings in In re Castle Horizon Real Estate, LLC, 2010 WL 3636160, *2 (Bankr. E.D. N.C. 2010); In re Sanchez, 429 B.R. 393, 398 (Bankr. D. Puerto Rico 2010); and In re Win Trucking, Inc., 236 B.R. 774, 778 (Bankr. D. Utah 1999). A copy of Judge Romero's May 25, 2011 Order is available at http://is.gd/qXkeo9from Leagle.com. Russell D. Sutherland filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 10-17768) on April 6, 2010. SALLY HOLDINGS: S&P Raises CCR to 'BB'; Outlook Revised to Pos. --------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Denton, Texas-based Sally Holdings LLC to 'BB' from 'BB- '. The rating outlook is positive. "At the same time, we raised our senior secured debt rating on Sally Holdings to 'BBB-' from 'BB+'. The recovery rating remains '1', indicating our expectations for very high (90%-100%) recovery in the event of a payment default," S&P said. "In addition, we revised our recovery rating on Sally's senior unsecured notes to '3' from '4'. The '3' recovery rating indicates our expectation of meaningful (50% to 70%) recovery for noteholders in the event of a payment default. This revision reflects our expectation that the company will continue to voluntarily repay debt (above the required amortization) with its positive cash flow. We raised our issue-level rating on this debt to 'BB' (the same as the corporate credit rating) from 'BB-', in accordance with our notching criteria for a '3' recovery rating," according to S&P. "We also raised our subordinated debt rating on Sally to 'B' from 'B-'. The recovery rating remains '6', indicating our expectations for negligible (0%-10%) recovery in the event of a payment default," S&P continued. "Our 'BB' rating reflects our view that Sally Holdings LLC and its wholly owned subsidiary Sally capital Inc. will maintain their positive momentum with sales growth, positive comparable-store sales, margin improvement, and debt reduction," said Standard & Poor's credit analyst Jayne Ross, "resulting in improving credit protection measures over the next 12 months." SAINT VINCENTS: District Court Affirms Stay Enforcement Order ------------------------------------------------------------- On Oct. 26, 2010, Erica T. Kagan filed an appeal from a Sept. 9, 2010 Order issued by Bankruptcy Judge Cecelia G. Morris enforcing the automatic stay imposed in the bankruptcy cases of Saint Vincents Catholic Medical Centers of New York and enjoining Ms. Kagan from prosecution of the case captioned In the Matter of Erica T. Kagan, an attorney at Kurland, Bonica & Associates, P.C. v. New York State Department of Health, Index No. 110869/2010, in the New York State Supreme Court. In a May 23, 2011 Opinion and Order, District Judge Jed S. Rakoff affirmed the Bankruptcy Court's ruling. The appeal arises from the closure of St. Vincent's Hospital Manhattan, a facility operated by Saint Vincent's Catholic Medical Centers of New York. On April 6, 2010, following several years in which the Hospital incurred tens of millions of dollars in operating losses, the Board of Directors of SVCMC voted to approve closure of the Hospital. According to the Debtors, they submitted a final plan for closure of the Hospital to the New York State Department of Health on April 8, 2010, and the DOH subsequently approved the plan. On April 14, 2010, the Debtors filed for relief under Chapter 11 of the Bankruptcy Code and moved for interim and final orders authorizing the Debtors to fully implement the Closure Plan. On April 16, 2010, the Bankruptcy Court entered an order granting the Closure Motion on an interim basis. On April 20, 2010, eight plaintiffs represented by the law firm of Kurland, Bonica & Associates, P.C., filed a complaint against the DOH and the Commissioner of the DOH, Richard F. Daines, in the New York State Supreme Court, County of New York. The complaint alleged that defendants violated various laws in approving the Hospital's closure, including 10 N.Y.C.R.R. Sec. 401.3(g), which provides that "[n]o medical facility shall discontinue operation or surrender its operating certificate unless 90 days' notice of its intention to do so is given to the commissioner and his written approval obtained." N.Y. Comp. Codes R. & Regs. tit. 10, Sec. 401.3(g) (2010)). Plaintiffs sought an order enjoining any further action by the defendants to close the Hospital and compelling the DOH Commissioner to initiate investigations of the Hospital. A copy of the District Court's decision is available at http://is.gd/BG9g1Dfrom Leagle.com. About Saint Vincents Saint Vincents Catholic Medical Centers of New York, doing business as St. Vincent Catholic Medical Centers -- http://www.svcmc.org/-- was anchored by St. Vincent's Hospital Manhattan, an academic medical center located in Greenwich Village and the only emergency room on the Westside of Manhattan from Midtown to Tribeca, St. Vincent's Westchester, a behavioral health hospital in Westchester County, and continuing care services that include two skilled nursing facilities in Brooklyn, another on Staten Island, a hospice, and a home health agency serving the Metropolitan New York area. Saint Vincent Catholic Medical Centers of New York and six of its affiliates first filed for Chapter 11 protection on July 5, 2005 (Bankr. S.D.N.Y. Case Nos. 05-14945 through 05-14951). St. Vincents Catholic Medical Centers returned to bankruptcy court by filing another Chapter 11 petition (Bankr. S.D.N.Y. Case No. 10-11963) on April 14, 2010. The Debtor estimated assets of $348 million against debts totaling $1.09 billion in the new petition. Although the hospitals emerged from the prior reorganization in July 2007 with a Chapter 11 plan said to have "a realistic chance" of paying all creditors in full, the bankruptcy left the medical center with more than $1 billion in debt. The new filing occurred after a $64 million operating loss in 2009 and the last potential buyer terminated discussions for taking over the flagship hospital. Adam C. Rogoff, Esq., and Kenneth H. Eckstein, Esq., at Kramer Levin Naftalis & Frankel LLP, represent the Debtor in its Chapter 11 effort. SBARRO, INC: Drops Prepack in Favor of Negotiating Sale ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Sbarro Inc. said it consensually terminated the plan- support agreement underlying the so-called prepackaged Chapter 11 petition filed on April 4. Instead, Sbarro said it will "explore other strategic alternatives." The company said a "qualified bidder" expressed an interest in an acquisition. MidOcean Partners, Ares Corporate Opportunities Fund II LP, and first-lien lenders support abandoning the prepackaged plan, Sbarro said. 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 approximately 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. The Debtor disclosed $51,537,899 in assets and $460,975,646 in liabilities 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. SBARRO, INC: Judge Sets July 8 Claims Bar Date ---------------------------------------------- Chapter11Cases.com reports that Bankruptcy Judge Shelley Chapman entered an order setting the deadline (or bar date) for the filing of proofs of claim on account of certain types of claims against Sbarro, Inc. and its affiliates. The order requires creditors to file proofs of claim on account of certain claims arising before the Petition Date (including 503(b)(9) claims) so that they are received by Sbarro's claims agent by or before 5:00 p.m. (Eastern) on July 8, 2011, Chapter11Cases.com. Chapter11Cases.com relates that governmental entities are required to file their proofs of claim by 5:00 p.m. (Eastern) on October 3, 2011. The order provides details of the categories of claims for which the bar date applies and the procedures which creditors must follow in order to file a valid proof of claim, Chapter11Cases.com says. 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 approximately 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. The Debtor disclosed $51,537,899 in assets and $460,975,646 in liabilities 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. SEAHAWK DRILLING: Hayman Capital's Wind Down Financing Approved --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas authorized, on a final basis, Seahawk Drilling, Inc., et al., to obtain obtain postpetition, secured wind down financing from Hayman Capital Master Fund, L.P., in the aggregate amount of $14,250,000. As reported in the Troubled Company Reporter on May 17, 2011, the Debtors will use the money to fund the operations during the period following the closing of the sale of the Debtors' assets to Hercules Offshore, Inc., through confirmation of the Debtors' Chapter 11 plan of reorganization. The Wind Down Facility will be released in two separate tranches: Tranche A, consisting of an initial draw of up to $5.75 million upon interim approval of this motion; and Tranche B, consisting of a secondary draw of $8.5 million upon final approval of this motion. The Wind Down Facility will be paid with shares of Hercules Common Stock on the effective date of a confirmed Chapter 11 plan of reorganization in the Debtors' jointly-administered bankruptcy cases. Hercules Offshore announced on April 27,, the completion of the asset purchase and sale. In accordance with the terms of the Asset Purchase Agreement, Hercules Offshore will acquire 20 jackup rigs located in the U.S. Gulf of Mexico and related assets, accounts receivable, cash, accounts payables, and certain contractual rights from Seahawk Drilling. The total consideration paid to Seahawk Drilling consists of approximately 22.3 million shares of Hercules Offshore common stock and $25.0 million in cash. Following this transaction, there will be a total of approximately 137.2 million outstanding shares of Hercules Offshore, Inc. The Debtors intend to use the cash received from Hercules under the APA to pay off the existing DIP Facility with D.E. Shaw Direct Capital, L.L.C. Immediately following the closing with Hercules, assuming Court approval is obtained, the Debtors will receive the first tranche under the Wind Down Facility with Hayman upon satisfaction of the conditions in the Wind Down DIP Loan Agreement. Presented below is a brief summary of the material terms of the proposed Wind Down Facility: a. Borrower: Seahawk Drilling, Inc., as a debtor-in-possession together with the subsidiary-debtors in this jointly- administered case. b. Guarantors: All debtors-in-possession in these Chapter 11 cases, other than the Borrower. c. Lender: Hayman or one of its affiliates. d. Term Loan Facility: The Wind Down Lender will lend up to $14,250,000 in the form of two term loans as follows: (i) a term loan of up to $5,750,000 (the "Tranche A Loan") in a single draw upon satisfaction of the conditions precedent to the Tranche A Loan and (ii) a term loan of up to $8,500,000 ] (the "Tranche B Loan") in a single draw upon satisfaction of the conditions precedent to the Tranche B Loan. e. Maturity: The Loans will mature upon the earlier of (i) Jan. 31, 2012 and (ii) the second Business Day after the effective date of a confirmed plan of reorganization or liquidation. f. Interest Rate: The Loans will bear interest at 13% per annum unless an Event of Default will have occurred, in which case the Loans will bear interest at 15% per annum. g. Interest Payments/PIK: Accrued interest on the Loans will be payable in arrears on the last day of each calendar month and on the Maturity Date and, if not paid in cash, then to the ] extent not so paid, will be payable in kind by adding such accrued interest not paid in cash to the unpaid principal balance of the Loans. h. Use of Proceeds: Proceeds of the Loans may only be used for (I) (A) the orderly wind down of the Borrower's bankruptcy estate, including all costs, fees, expenses (including, without limitation, legal fees and expenses) payable to the Wind Down Lender and (B) the administration of claims and distributions to creditors and interest holders in accordance with a budget acceptable to the Lender (together with any and all updates, supplements and/or modifications to such budget that have been approved in advance by the Bankruptcy Court and the Lender, collectively, the "Wind Down Budget") and (ii) the Carve-Out. k. Payment at Maturity: The Borrower will repay the Loans no later than the Maturity Date, which will be the earlier of: (i) Jan. 31, 2012 and (ii) the second Business Day after the effective date of the Reorganization Plan. At such time as the Loans shall become due and payable, whether on the Maturity Date or, if earlier, upon acceleration, the Balance Due will be payable by the transfer to the Wind Down DIP Lender, free and clear of all Liens, of a number of shares of common stock, par value $0.01 per share, of Hercules then owned by the Loan Parties and maintained pursuant to the Escrow Agreement as in effect on the date hereof having an aggregate value, when determined in accordance with the provisions of Section 3.02 of the Wind Down DIP Loan Agreement, equal to the Balance Due. If the Borrower is unable to pay or satisfy in full the Balance Due because either (i) the Subject Hercules Common Stock does not constitute Released Hercules Stock or, (ii) after applying all Released Hercules Stock in accordance with Section 3.01(b) and Section 3.02, a Balance Due remains, such Balance Due will be payable in full in dollars when due. A copy of the Debtor-in-Possession Loan, Security and Guaranty Agreement is available for free at: http://bankrupt.com/misc/seahawk,winddownfacilitymotion.pdf About Seahawk Drilling Houston, Texas-based Seahawk Drilling, Inc., engages in a jackup rig business in the United States, Gulf of Mexico, and offshore Mexico. It offers rigs and drilling crews on a day rate contractual basis. The Company and several affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 11-20089) on Feb. 11, 2011. Berry D. Spears, Esq., and Johnathan C. Bolton, Esq., at Fullbright & Jaworkski L.L.P., in Houston, serve as the Debtors' bankruptcy counsel. Shelby A. Jordan, Esq., and Nathaniel Peter Holzer, Esq. at ordan, Hyden, Womble, Culbreth & Holzer, P.C., in Corpus Christi, Texas, serve as the Debtors' co-counsel. Alvarez and Marsal North America, LLC, is the Debtors' restructuring advisor. Simmons & Company International is the Debtors' transaction advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. Judy A. Robbins, U.S. Trustee for Region 7, appointed three creditors to serve on an Official Committee of Unsecured Creditors of Seahawk Drilling Inc. and its debtor- affiliates. Heller, Draper, Hayden, Patrick & Horn, L.L.C., represents the creditors committee. In its amended schedules, Seahawk Drilling disclosed $208,190,199 in assets and $438,458,460 in liabilities as of the petition date. Seahawk filed for Chapter 11 protection to complete the sale of all assets to Hercules Offshore, Inc. As reported by the Troubled Company Reporter on April 11, 2011, the Bankruptcy Court approved an Asset Purchase Agreement between Hercules Offshore and its wholly owned subsidiary, SD Drilling LLC, and Seahawk Drilling, pursuant to which Seahawk agreed to sell to Hercules, and Hercules agreed to acquire from Seahawk, all 20 of Sellers' jackup rigs and related assets, accounts receivable and cash and certain liabilities of Sellers in a transaction pursuant to Section 363 of the U.S. Bankruptcy Code. According to DBR Small Cap, the deal was valued at about $176 million when it received court approval. Based on previous TCR reports, the purchase price for the Acquisition will be funded by the issuance of roughly 22.3 million shares of Hercules Offshore common stock and cash consideration of $25 million, which will be used primarily to pay off Seahawk's Debtor-in-Possession loan. The number of shares of Hercules Offshore common stock to be issued will be proportionally reduced at closing, based on a fixed price of $3.36 per share, if the outstanding amount of the DIP loan exceeds $25 million, with the total cash consideration not to exceed $45 million. The deal closed on April 27, 2011. SEP RIVERPARK: Plan Outline Hearing Continued Until June 1 ---------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Oklahoma Has continued until June 1, 2011, at 9:30 a.m., the hearing to consider adequacy of the disclosure statement explaining SEP Riverpark Plaza, L.L.C.'s Plan of Reorganization. As reported by the Troubled Company Reporter on March 11, 2011, the Debtor filed with the Court a plan of reorganization and an accompanying disclosure statement. The Plan is aimed at immediately placing the Debtor's property on the market through Price Edwards Company, actively seeking a purchase contract for the fair market value of the project, paying all creditors in full with interest, and allowing the equity security holder to receive any remaining funds left from the sale proceeds. All classes of claims and interests are impaired under the Plan, except Class 3 - - tenant security deposit claims characterized as being entitled to priority. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/SEP_RIVERPARK_ds.pdf About SEP Riverpark Oklahoma City, Oklahoma-based SEP Riverpark Plaza, L.L.C., aka Riverpark Plaza Apartments, filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 0-16832) on Nov. 11, 2010. According to its schedules, the Debtor disclosed 19,165,623 in total assets and $12,026,685 in total debts. On Jan. 13, 2011, Judge Sarah A. Hall authorized the Debtor's employment of Hiersche Law Firm as its bankruptcy counsel. SHARMA HOLDING: Case Summary & 12 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Sharma Holding Company, LLC P.O. Box 2666 Sausalito, CA 94966 Bankruptcy Case No.: 11-11950 Chapter 11 Petition Date: May 25, 2011 Court: United States Bankruptcy Court Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: David N. Chandler, Esq. LAW OFFICES OF DAVID N. CHANDLER 1747 4th St. Santa Rosa, CA 95404 Tel: (707) 528-4331 E-mail: DChandler1747@yahoo.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 12 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/canb11-11950.pdf The petition was signed by Fred Usher, managing member. SHERIDAN GROUP: Incurs $2.36-Mil. First Quarter Net Loss -------------------------------------------------------- The Sheridan Group, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $2.36 million on $68.18 million of net sales for the three months ended March 31, 2011, compared with net income of $1.54 million on $68.29 million of net sales for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $235.12 million in total assets, $199.38 million in total liabilities and $35.74 million in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/k5ONSA About The Sheridan Group Hunt Valley, Maryland-based The Sheridan Group, Inc. -- http://www.sheridan.com/-- is a specialty printer offering a full range of printing and value-added support services for the journal, catalog, magazine and book markets. The Sheridan Group, Inc., reported a net loss of $5.9 million on $266.2 million of sales for 2010, compared with net income of $8.2 million on $293.9 million of sales for 2009. PricewaterhouseCoopers LLP, in Baltimore, Maryland, expressed substantial doubt about The Sheridan Group, Inc.'s ability to continue as a going concern. The independent auditors noted that the Company has a significant amount of current debt maturing within the next twelve months and will need to raise additional capital in order to settle these obligations. SHREE-GURU INVESTMENTS: Case Summary & Creditors List ----------------------------------------------------- Debtor: Shree-Guru Investments, Inc. 1716 Jefferson Street Jefferson City, MO 65109 Bankruptcy Case No.: 11-20962 Chapter 11 Petition Date: May 27, 2011 Court: U.S. Bankruptcy Court Western District of Missouri (Jefferson City) Judge: Dennis R. Dow Debtor's Counsel: Jonathan A. Margolies, Esq. MCDOWELL RICE SMITH & BUCHANAN 605 W. 47th Street, Suite 350 Kansas City, MO 64112 Tel: (816) 753-5400 Fax: (816) 753-9996 E-mail: jmargolies@mcdowellrice.com Estimated Assets: $100,001 to $500,000 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/mowb11-20962.pdf The petition was signed by George Pate, president. SHOPS AT PRESTONWOOD: Taps Franklin Skierski as Bankruptcy Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas, authorized The Shops at Prestonwood, LP, to employ Franklin Skierski Lovall Hayward, LLP as general bankruptcy counsel. FSLH is representing the Debtor in the Bankruptcy proceedings. FSLH is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. FSLH can be reached at: Melissa S. Hayward, Esq. FRANKLIN SKIERSKI LOVALL HAYWARD LLP 10501 N. Central Expy, Suite 106 Dallas, TX 75231 Tel: (972) 755-7100 Fax: (972) 755-7110 E-mail: MHayward@FSLHlaw.Com 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. The Debtor 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 disclosed $18,200,000 in assets and $14,151,239 in liabilities as of the Chapter 11 filing. SHOPS AT PRESTONWOOD: Wants to Sell 6 Residential Lots to Insider ----------------------------------------------------------------- The Shops at Prestonwood, LP, asks the U.S. Bankruptcy Court for the Northern District of Texas for authorization to: -- sell six single family residential lots to insider Prestonwood Custom Homes, L.P., for $65,000 per lot, or a total price of $390,000; -- pay claims of any taxing authorities attributable to the subject lots and, amounts owed to property tax solutions attributable to the subject lots from the sales proceeds at closing. The Debtor relates that PWCH is an insider of the Debtor and is owned in part by Michael Holigan, one of the Debtor's officers. Additionally, Brady Giddens, an officer of the Debtor's managing general partner, is also an officer of PWCH. The sale will not be subject to bigger and better offers and will be free and clear of all liens, interests, and encumbrances. The Court will consider the Debtor's request to sell assets at hearing on June 7,2011 at 9:00 a.m. The Debtor is represented by: Melissa S. Hayward, Esq. FRANKLIN SKIERSKI LOVALL HAYWARD LLP 10501 N. Central Expy, Ste. 106 Dallas, TX 75231 Tel: (972) 755-7100 Fax: (972) 755-7114 E-mail: MHayward@FSLHlaw.com 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. The Debtor 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 disclosed $18,200,000 in assets and $14,151,239 in liabilities as of the Chapter 11 filing. No creditors' committee, trustee nor examiner has been appointed in the case. SIMMONS FOODS: S&P Lowers Corporate Credit Rating to 'B-' --------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Siloam Springs, Ark.-based Simmons Foods Inc. to 'B-' from 'B'. "At the same time we lowered our issue-level rating on the company's $265 million second-lien notes maturing 2017 to 'CCC+' from 'B-', with an unchanged recovery rating of '5', indicating our expectation for modest (10%-30%) recovery in the event of a payment default. We placed all ratings on CreditWatch with developing implications," S&P said. "The downgrade and CreditWatch placement reflect the risk of Simmons Foods operating under a forbearance agreement, and the uncertainty about its maintaining an adequate liquidity profile prior to obtaining a timely amendment," said Standard & Poor's credit analyst Christopher Johnson. "Although the company was in compliance with its financial covenants for the first quarter of 2011 (ended March 31) and is actively seeking an amendment, we are uncertain about the company's ability to obtain a timely amendment given that we believe the company would have breached its leverage covenant for the period ending April 30, 2011, had it not obtained a forbearance agreement." "The CreditWatch developing placement means that Standard & Poor's could either lower or raise the ratings once we have resolved the CreditWatch," S&P said. "We will closely monitor Simmons Foods' progress in obtaining an amendment to its bank facility credit agreement, and will assess the amount of future covenant headroom as well as the outlook for the company's underperforming poultry operations prior to resolving our CreditWatch," said Mr. Johnson. "We could raise the ratings back to 'B' if the company obtains an amendment with adequate cushion to withstand a continued downturn in its poultry segment. Alternatively, we would further lower the ratings if the company is not able to obtain an amendment and consequently defaults on its debt obligations." SMART ONLINE: Incurs $987,798 Net Loss in First Quarter ------------------------------------------------------- Smart Online, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $987,798 on $138,738 of total revenues for the three months ended March 31, 2011, compared with a net loss of $916,925 on $363,900 of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $744,575 in total assets, $21.01 million in total liabilities and a $20.27 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/XTgtX5 About Smart Online Headquartered in Durham, North Carolina, Smart Online, Inc. (OTC BB: SOLN) -- http://www.smartonline.com/-- develops and markets software products and services targeted to small businesses that are delivered via a Software-as-a-Service (SaaS), or SaaS, model. The Company also provides Web site consulting services, primarily in the e-commerce retail industry products and services. The Company reported a net loss of $3.95 million on $1.03 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $9.54 million on $1.42 million of total revenue during the prior year. As reported by the TCR on April 4, 2011, Cherry, Bekaert & Holland, LLP, in Raleigh, North Carolina, noted that the Company has suffered recurring losses from operations and has a working capital deficiency as of Dec. 31, 2010. These conditions, according to the independent auditors, raise substantial doubt about the Company's ability to continue as a going concern, the auditors said. SOURCE INTERLINK: Acquires Mind Over Eye ---------------------------------------- Stefani Botelho at Folio Mag reports that Source Interlink Media has acquired Mind Over Eye, a digital marketing and visual effects studio in Santa Monica, California. The company will now market itself as a full-service creative agency as the company pulls together its existing resources under one umbrella. Source Interlink is a U.S. distributor of home entertainment products and services and one of the largest publishers of magazines and online content for enthusiast audiences. Source Interlink and 17 affiliates filed for bankruptcy (Bankr. D. Del. Case No. 09-11424) on April 27, 2009. Attorneys at Kirkland & Ellis LLP and Pachulski Stang Ziehl Young Jones served as bankruptcy counsel. SIM emerged from bankruptcy in 2009. SPARTAN HOLDING: Case Transferred W.D.N.C. Bankruptcy Court ----------------------------------------------------------- Bankruptcy Judge Randy D. Doub transfers the venue of Spartan Holding Company, Inc.'s Chapter 11 case to the Western District of North Carolina at the behest of the Bankruptcy Administrator. The judge said the interest of the estate will best be served by transferring the case. Spartan Holding Company, Inc., filed a Chapter 11 petition (Bankr. E.D.N.C. Case No. 11-02355) on March 28, 2011. The Bankruptcy Administrator contends, that venue in the Eastern District of North Carolina is improper and that the petition should have been filed in the Western District of North Carolina. The Bankruptcy Administrator sought either dismissal or transfer of venue. Law Office of Jack B. Styles serves as the Debtor's counsel. In its petition, the Debtor scheduled assets of $734,400 and debts of $1,366,225. The petition was signed by Ralph Ledford, its president. A copy of Judge Doub's May 24, 2011 Order is available at http://is.gd/5LXYQTfrom Leagle.com. SRKO FAMILY: Can Hire Littleton & Project One as REIT Consultants ----------------------------------------------------------------- The SRKO Family Limited won permission from the U.S. Bankruptcy Court for the District of Colorado to employ Littleton Capital Partners and Project One Integrated Services as real estate development consultants. Littleton Capital will undertake a 60-day study on the status of Colorado Crossing and the requirements for proceeding to development while Project One will coordinate the task to be undertaken by it with Littleton Capital and do a construction inspection and assessment of costs to complete the development. Colorado Crossing, the Debtor's primary asset, is a 154 acre mixed use development located on the north end of Colorado Springs. The Debtor will pay Littleton Capital Partners $20,000 per month for the initial two month engagement. The Debtor will also pay Project One $18,450 per month for the initial two month engagement. About The SRKO Family LP The SRKO Family Limited Partnership, dba Colorado Crossing, is based in Colorado Springs, Colorado. SRKO Family is the owner of the financially troubled Colorado Crossing project. The Company was run by Colorado Springs developer Jannie Richardson. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Colo. Case No. 10-13186) on Feb. 19, 2010. The Debtor disclosed $34,421,448 in assets and $80,619,854 in liabilities as of the Petition Date. STONERIDGE INC: S&P Raises Corporate Credit Rating to 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Warren, Ohio-based auto supplier Stoneridge Inc. to 'BB- ' from 'B+'. The outlook is stable. "At the same time, we raised our issue-level ratings on the company's senior secured notes to 'BB-' from 'B+'. The recovery ratings on the debt remain unchanged," S&P stated. "The upgrade reflects our opinion that Stoneridge's credit profile has risen to levels consistent with the 'BB-' rating and that the company can sustain the improvement," said Standard & Poor's credit analyst Lawrence Orlowski. "Given the improving credit measures, we view Stoneridge's financial risk profile as significant. For instance, at the end of 2010, the company's adjusted debt to EBITDA was 4.0x and we expect leverage to be comfortably below 3.0x by the end of 2011 because of strong growth and expanding margins in 2011. It was 3.6x at March 31, 2011." STUDIO ONE: Posts $1.9 Million Net Loss in Q3 Ended March 31 ------------------------------------------------------------ Studio One Media, Inc.'s filed its quarterly report on Form 10-Q, reporting a net loss of $1.9 million on $135,130 of revenues for the three months ended March 31, 2011, compared with a net loss of $1.4 million on $65,713 of revenues for the three months ended March 31, 2010. Total revenues for the nine months ended March 31, 2011, increased to $369,440 from $132,084 or 180% over the comparable nine month period in 2010. Net loss was $4.9 million for the nine-months ended March 31, 2011, compared with a net loss of $4.1 million for the nine-months ended March 31, 2010. The Company's balance sheet at March 31, 2011, showed $3.1 million in total assets, $1.9 million in total liabilities, and stockholders' equity of $1.2 million. SingerLewak LLP, in Los Angeles, expressed substantial doubt about the Studio One Media's ability to continue as a going concern, following the Company's results for the fiscal year ended June 30, 2010. The independent auditors noted that the Company has historically suffered recurring losses from operations, has a substantial accumulated deficit and has limited revenues. A copy of the Form 10-Q is available at http://is.gd/2psXNW Studio One Media, Inc. (OTC BB: SOMD) is a diversified media and technology company based in Scottsdale, Arizona. The Company's subsidiaries and divisions include MyStudio, Inc., AfterMaster HD Audio Labs, Inc., MyStudio Music and MyStudio Management. Over the last seven years, Studio One and its wholly-owned subsidiary, MyStudio, Inc., have been engaged in the research and development of proprietary, leading-edge audio and video technologies for professional and consumer use. SUFFOLK REGIONAL OTB: Proposes Paying Admin. Creditors in Full -------------------------------------------------------------- American Bankruptcy Institute reports that under the terms of Suffolk Regional Off-Track Betting Corp.'s adjusted chapter 9 reorganization plan, all administrative expenses and claims would be paid in full in cash on the effective date of the plan. About the Company Hauppauge, New York-based Suffolk Regional Off-Track Betting Corporation, aka Suffolk OTB, filed for Chapter 9 bankruptcy protection (Bankr. E.D. N.Y. Case No. 11-42250) on March 18, 2011. Christopher F. Graham, Esq., at McKenna Long & Aldridge LLP, serves as the Debtor's bankruptcy counsel. The Garden City Group is the notice, claims, and solicitation agent, nunc pro tunc to the Petition Date. The Debtor estimated its assets and debts at $10 million to $50 million. Suffolk OTB said in its bankruptcy petition that it qualified under Chapter 9 and that its board of directors authorized its officers to seek the necessary legislative authorization. SUN VALLEY: Case Summary & 14 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Sun Valley Estates, LLC dba Reflection Lake RV Park & Campground 11580 Petenwell Road San Diego, CA 92131 Bankruptcy Case No.: 11-08607 Chapter 11 Petition Date: May 25, 2011 Court: United States Bankruptcy Court Southern District of California (San Diego) Debtor's Counsel: John L. Smaha. Esq. SMAHA LAW GROUP, APC 7860 Mission Center Court, Suite 100 San Diego, CA 92108 Tel: (619) 688-1557 Fax: (619) 688-1558 E-mail: jsmaha@smaha.com Scheduled Assets: $5,606,783 Scheduled Debts: $4,468,480 A list of the Company's 14 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/casb11-08607.pdf The petition was signed by John Grant, co-trustee. SUPERIOR ACQUISITIONS: Plan Confirmation Date Extended to July 20 ----------------------------------------------------------------- Superior Acquisitions, Inc. and the U.S. Trustee for Region 16 jointly sought and obtained approval from the U.S. Bankruptcy Court for the Northern District of California of a stipulation extending the deadline for the Debtor to confirm his Chapter 11 Plan to July 20, 2011. About Superior Acquisitions Superior Acquisitions, Inc., in Lakeport, California, filed for Chapter 11 bankruptcy (Bankr. N.D. Calif. Case No. 10-13730) on Sept. 28, 2010, Judge Alan Jaroslovsky presiding. The Debtor disclosed $13,889,530 in assets and $14,866,437 in liabilities as of the Chapter 11 filing. The Law Offices of Michael C. Fallon -- mcfallon@fallonlaw.net -- serves as bankruptcy counsel to the Debtor. Linda S. Green was later appointed as Chapter 11 trustee. She is represented by John H. MacConaghy, Esq. -- macclaw@macbarlaw.com -- at MacConaghy and Barnier, as counsel. The Chapter 11 trustee has tapped Bachecki Crom & Co. LLP as her accountant. SW GEORGIA ETHANOL: Plan Filing Exclusivity Extended Until July 1 ----------------------------------------------------------------- Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that Southwest Georgia Ethanol LLC obtained an extension of the company's exclusive right to propose a Chapter 11 plan until July 1, one month less than the company wanted. The Debtor said it has made progress in negotiating with the Company's lenders and creditors. About Southwest Georgia Ethanol Southwest Georgia Ethanol LLC, a unit of First United Ethanol Co., sought bankruptcy protection (Bankr. M.D. Ga. 11-10145) in Albany, Georgia, on Feb. 1, 2011. The Debtor owns and operates an ethanol production facility located on 267 acres in Mitchell County, Georgia, producing 100 million gallons of ethanol annually. Ethanol production operations commenced in October 2008. Revenue was $168.9 million for fiscal year ended Sept. 30, 2010. The Debtor said profitability and liquidity have been materially reduced by unfavorable fluctuations in commodity prices for ethanol and corn. John Michael Levengood, Esq., at McKenna Long & Aldridge LLP, in Atlanta, Georgia, serves as counsel to the Debtor. Morgan Keegan & Company, Inc., is the investment banker and financial advisor. The Debtor's balance sheet showed $164.7 million in assets and $134.1 million in debt as of Dec. 31, 2010. Since 2008, at least 11 ethanol-related companies have sought court protection, including VeraSun Energy Corp., once the second- largest U.S. ethanol maker; units of Pacific Ethanol Inc.; and White Energy Holding Co. SW OWNERSHIP: Financing Denied, Wants Case Converted to Chapter 7 ----------------------------------------------------------------- SW Ownership LLC, asks the U.S. Bankruptcy Court for the Western District of Texas, to convert it Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. The Debtor explains that it has no access to other funds for its rehabilitation. The Debtor relates that on May 6, 2011, the Court determined to deny the Debtor to obtain financing and granted the lift stay in favor of International Bank of Commerce, the Debtor's prepetition senior secured lender. As a result of the rulings, IBC will foreclose upon the estate's sole tangible assets (with the exception of nominal cash in the Debtor's accounts and estate claims) and the Debtor's sole means of generating revenues or cash flow. About SW Ownership SW Ownership LLC is a single member limited liability company owned by SW Ownership Holdings LLC. The Debtor owns the project commonly known as "Skywater Over Horseshoe Bay" that is currently being developed in Llano and Burnet counties and is comprised of a roughly 1,600-acre residential community project with an 18-hole, Jack Nicklaus-designed, Signature Golf Course. SW Ownership LLC does not currently maintain operations (save for Project development) and has no employees. Skywater Management LLC is the pre-petition and current manager of the Project for SWO. SW Ownership LLC filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 11-10485) on Feb. 28, 2011, represented by lawyers at Munsch Hardt Kopf & Harr, P.C. The Debtor disclosed $76,983,491 in assets and $37,793,270 in liabilities as of the Chapter 11 filing. The Debtor tapped Richard Ellis, Inc., as its appraiser, valuation consultant and experts. SYRACUSE LITHOGRAPHING: Case Summary & Creditors List ----------------------------------------------------- Debtor: Syracuse Lithographing Company dba Syracuse Litho 163 Solar Street Syracuse, NY 13204 Bankruptcy Case No.: 11-31211 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Northern District of New York (Syracuse) Judge: Margaret M. Cangilos-Ruiz Debtor's Counsel: Stewart L. Weisman, Esq. LAW OFFICE OF STEWART L. WEISMAN Box 598, Shadow Rock Manlius, NY 13104-0598 Tel: (315) 682-0652 Fax: (315) 682-0734 E-mail: sweisman@twcny.rr.com Scheduled Assets: $739,733 Scheduled Debts: $1,006,651 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/nynb11-31211.pdf The petition was signed by Darryl J. Grandy, sole owner/president/director. T3 MOTION: Restates Debenture Agreement with Vision Opportunity --------------------------------------------------------------- T3 Motion, Inc., on May 9, 2011, entered into a Restated Debenture Amendment and Conversion Agreement with Vision Opportunity Master Fund, Ltd., that restated an earlier agreement originally dated as of March 31, 2011. Under the Agreement, the parties restated the Debenture Agreement to provide that the deletion of the current conversion provisions of the Debenture would not take effect until the closing of the offering. About T3 Motion Costa Mesa, Calif.-based T3 Motion, Inc., develops and manufactures T3 Series vehicles, which are electric three-wheel stand-up vehicles that are directly targeted to the public safety and private security markets. The Company reported a net loss of $8.32 million on $4.68 million of net revenues for the year ended Dec. 31, 2010, compared with a net loss of $6.70 million on $4.64 million of net revenues during the prior year. The Company's balance sheet at Dec. 31, 2010, showed $3.58 million in total assets, $19.25 million in total liabilities, and a $15.67 million stockholders' deficit. As reported by the TCR on April 6, 2011, KMJ Corbin & Company LLP, in Costa Mesa, Calif., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant operating losses and has used substantial amounts of working capital in its operations since inception, and at Dec. 31, 2010, has a working capital deficit of $15,057,791 and an accumulated deficit of $45,120,210. TASTY BAKING: Common Stock Delisted from NASDAQ ------------------------------------------------ The NASDAQ Stock Market LLC notified the U.S. Securities and Exchange Commission regarding the removal from listing or registration of Tasty Banking Co.'s common stock from the Exchange. 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. The Company reported 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 March 26, 2011, showed $153.32 million in total assets, $172.18 million in total liabilities and a $18.86 million total 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. 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 CAPITAL GROUP: Fitch Affirms Long-Term IDR at 'B-' -------------------------------------------------------- Fitch Ratings has affirmed the 'B-' long-term Issuer Default Ratings (IDR) of Taylor Capital Group Inc. (TAYC) and 'B' long- term IDR of Cole Taylor Bank. The Rating Outlook for TAYC and Cole Taylor Bank is revised to Negative from Stable. Supporting the revision of the Rating Outlook to Negative from Stable, TAYC reported a continued high and increasing level of problem assets. Non-performing assets (NPAs), including accruing troubled debt restructurings (TDRs), have increased to 8.01% of loans and foreclosed real estate at March 31, 2011, up from 5.65% a year ago. Further, although TAYC reported a modest profit (before preferred dividends) in the first quarter of 2011 (1Q'11), earnings remain weak and volatile, impacted by fluctuating levels of securities gains and credit costs. TAYC's ratings at their current levels were affirmed based on strengthened regulatory capital levels, and a good liquidity profile. TAYC is still struggling with elevated levels of NPAs, driven by the weak real estate market in the Chicago area. TAYC's loan portfolio includes a high percentage of commercial real estate (CRE) loans (including C&LD) at 46% of loans and approximately 562% of stockholder's equity at March 31, 2011. This deteriorating trend is counter to industry trends in which many banking institutions are reporting improving credit metrics over the past several quarters. TAYC also has a book of bank holding and bank loans, which totaled $86 million at March 31, 2011, some of which is nonperforming. Fitch expects that high credit costs will impede a consistent return to core profitability over the near term for TAYC. TAYC reported basically break-even profitability (before preferred dividends) in 1Q'11, supported by much lower provision expenses during the quarter. TAYC's earnings are still primarily spread income driven, but becoming increasingly diversified with TAYC's entry into asset-based and mortgage lending. The holding company's ratings are notched below those of the bank suggesting greater levels of stress at the parent than bank. Although the holding company has adequate levels of cash on hand to service existing debt obligations, given the operating losses at the bank level over the past several years, there is no upstream bank dividend capacity. Further, TAYC still has the $105 million Troubled Asset Relief Program (TARP) preferred stock still outstanding, which will reset to more onerous 9% dividends in 2013. Providing support to the affirmation of TAYC's ratings at their current levels, TAYC's regulatory capital ratios have been augmented through continued capital contributions from a committed group of management and investors. Most recently, TAYC raised $25 million in preferred stock in 1Q'11 that has since converted to common equity. Despite $325 million in capital raised over the past several years, mostly in the form of preferred stock investments, the ratio of tangible common equity to tangible assets remains low at 2.12% as of March 31, 2011. In the meantime, TAYC's regulatory capital ratios are appropriate for its rating category. TAYC's Rating Outlook could be positively affected through a moderation in credit trends, improving financial performance, and building capital ratios. Conversely, TAYC's long-term IDR could be negatively affected if the company needs to raise a significant amount of further capital given a deterioration in asset quality. Fitch would likely downgrade the IDRs and debt ratings of TAYC and affiliates if asset quality continues to deteriorate and causes further pressure on capital. On the other hand, a sustained return to profitability combined with progress in lowering problem asset levels could cause Fitch to revise the Outlook to Stable. Fitch has affirmed these ratings: Taylor Capital Group, Inc. -- Long-term Issuer Default Rating (IDR) at 'B-'; -- Individual at 'D/E'; -- Preferred stock at 'CC/RR6'. -- Short-term IDR at 'B'. -- Support rating at '5'; -- Support floor at 'NF'. Cole Taylor Bank -- Long-term IDR at 'B'; -- Short-term at 'B'; -- Individual at 'D'; -- Long-term deposits at 'B+/RR3'; -- Short-term deposits at 'B'; -- Support rating at '5'; -- Support floor at 'NF'. TAYC Capital Trust I -- Preferred stock at 'CC/RR6'. TELVUE CORPORATION: Incurs $797,600 Net Loss in March 31 Quarter ---------------------------------------------------------------- TelVue Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $797,606 on $1.1 million of revenues for the three months ended March 31, 2011, compared with a net loss of $874,328 on $887,572 of revenues for the same period last year. The Company's balance sheet at March 31, 2011, showed $1.5 million in total assets, $24.4 million in total liabilities, and a stockholders' deficit of $22.9 million. ParenteBeard LLC, in Huntingdon Valley, Pa., expressed substantial doubt about TelVue's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has suffered recurring losses from operations and has a net accumulated deficit. A copy of the Form 10-Q is available at http://is.gd/XS8r0O Mt. Laurel, N.J.-based TelVue Corporation is a broadcast technology company that specializes in playback, automation and workflow solutions for public, education and government ("PEG") television stations; cable, telephone company ("Telco") and satellite television providers; K-12 and higher education institutions; and professional broadcasters. TEMPLE-INLAND: Moody's Upgrades Senior Unsecured Debt From Ba1 -------------------------------------------------------------- Moody's Investors Service upgraded Temple-Inland Inc's (Temple- Inland) senior unsecured debt ratings to Baa3 from Ba1. In a related rating action, Moody's withdrew the company's Ba1 corporate family rating. The upgrade recognizes Temple-Inland's improved credit protection metrics through both debt reduction and strong financial performance. Temple-Inland has been able to restore most of its credit protection metrics to levels that existed prior to the implementation of the company's transformation plan in 2007. Moody's estimates that Temple Inland's leverage (adjusted debt to EBITDA) will be in the 2-2.5x range during the following 12 to 18 months. The rating outlook is stable. RATINGS RATIONALE Temple-Inland's Baa3 senior unsecured rating primarily reflects the company's low cost integrated operations, strong operating cash flow and key credit protection measures. Temple-Inland is one of the most forward-integrated producers of corrugated packaging in North America, with approximately 95% of the company's containerboard converted in the company's own box plants. The rating also reflects Temple-Inland's good liquidity position and through the cycle derives some support from the diversification provided by the company's wood products business. Temple-Inland's ratings are constrained by the cyclicality of the packaging and wood products industry and the pressures from high fiber, energy and chemical costs. The Baa3 rating anticipates that the company will maintain conservative financial policies and will not pressure its balance sheet or liquidity position with excessive dividend payouts, share buy backs or acquisitions. The company has good liquidity which includes unused borrowing capacity of about $670 million on committed credit facilities (that mature beyond one-year) totaling $935 million (as of Q1- 2011). This consists of a $600 million revolving credit facility that matures in June 2014 and a $250 million accounts receivable securitization program and $85 million of other committed credit agreements that all mature by 2013. In addition, the company has about $24 million of cash on hand, Moody's estimated free cash flow generation of approximately $90 million and about $25 million in debt maturities during 2011. Covenant issues are not expected over the near term. The stable rating outlook reflects Moody's belief that Temple- Inland will consistently generate strong cash flow as a result of its integrated low cost operations and that the company may be able to further improve its current credit protection measures as it completes its box plant transformation projects and conditions in the housing market return to normalized levels. An upgrade to Baa2 would be dependent on the ability to maintain a good liquidity position and sustain normalized RCF/TD above 25%, (RCF-CapEx)/TD above 16% and total debt to EBITDA below 2.5x. The ratings or outlook could be pressured if demand or prices fall materially causing deterioration in the company's liquidity profile or should Moody's expectations of normalized RCF/Debt drop below 20%, (RCF-Capex)/Debt below 12%, or if total debt to EBITDA exceeds 3x. Upgrades: Issuer: Angelina & Neches River Authority, TX -- Senior Unsecured Revenue Bonds, Upgraded to Baa3 from Ba1 Issuer: Floyd County Development Authority, GA -- Senior Unsecured Revenue Bonds, Upgraded to Baa3 from Ba1 Issuer: Maysville (City of) KY -- Senior Unsecured Revenue Bonds, Upgraded to Baa3 from Ba1 Issuer: McDuffie County Development Authority, GA -- Senior Unsecured Revenue Bonds, Upgraded to Baa3 from Ba1 Issuer: Temple-Inland Inc. -- Senior Unsecured Regular Bond/Debenture, Upgraded to Baa3 from Ba1 Outlook Actions: Issuer: Temple-Inland Inc. -- Outlook, Changed To Stable From Positive Withdrawals: Issuer: Angelina & Neches River Authority, TX -- Senior Unsecured Revenue Bonds, Withdrawn, previously rated LGD4, 63% Issuer: Floyd County Development Authority, GA -- Senior Unsecured Revenue Bonds, Withdrawn, previously rated LGD4, 63% Issuer: Maysville (City of) KY -- Senior Unsecured Revenue Bonds, Withdrawn, previously rated LGD4, 63% Issuer: McDuffie County Development Authority, GA -- Senior Unsecured Revenue Bonds, Withdrawn, previously rated LGD4, 63% Issuer: Temple-Inland Inc. -- Probability of Default Rating, Withdrawn, previously rated Ba1 -- Corporate Family Rating, Withdrawn, previously rated Ba1 -- Senior Unsecured Regular Bond/Debenture, Withdrawn, previously rated LGD4, 63% The principal methodology used in rating Temple Inland was the Global Paper and Forest Products Industry Methodology, published September 2009. Headquartered in Austin, Texas, Temple-Inland, is an integrated corrugated packaging and building products company. TIMOTHY BLIXSETH: Involuntary Petition Dismissed for Wrong Venue ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Timothy Blixseth persuaded the bankruptcy judge in Las Vegas to dismiss the involuntary Chapter 7 petition filed against him in early April by three states, Mr. Blixseth said in a statement. The bankruptcy judge didn't reach the issue of whether Blixseth is bankrupt. Instead, U.S. Bankruptcy Judge Bruce A. Markell ruled that the involuntary petition shouldn't have been filed in Nevada because Mr. Blixseth neither lived nor worked there, Mr. Blixseth said. Although the petition was dismissed, Judge Markell is allowing the state of Montana to refile the petition in a proper location. Montana originally filed the involuntary petition along with the states of California and Utah. Mr. Blixseth paid off California and Utah at a 15 percent discount, and the two states withdrew their participation in the petition. Together, the two states were paid about $1.9 million. Mr. Rochelle says Judge Markell scheduled a hearing in September to decide whether it's appropriate to impose sanctions on Montana for having the petition dismissed. Montana alleged Mr. Blixseth owed an undisputed $219,000 in taxes. Mr. Blixseth opposed Montana's right to file the petition, saying the tax debt to the state is disputed. Mr. Rochelle relates that the judge himself initially raised the question about whether the involuntary petition was filed in the correct state. Shortly after the petition was filed, he directed the parties to explain why the case shouldn't be dismissed or transferred to another state where Mr. Blixseth lives or has property. Montana contended that Nevada was correct because the company that owns most of Mr. Blixseth's assets was formed under Nevada law, even though it had no property or offices in Nevada. About Timothy Blixseth Tax officials from California, Montana and Idaho on April 5, 2011 filed an involuntary-bankruptcy petition under Chapter 7 against Timothy Blixseth in Las Vegas, Nevada (Bankr. D. Nev. Case No. 11-15010). The three states that signed the petition against the Yellowstone Club co-founder claim they are owed $2.3 million in back taxes. A copy of the petition is available for free at http://bankrupt.com/misc/nvb11-15010.pdf Mr. Blixseth and his former wife, Edra Blixseth, founded the Yellowstone Club, near Big Sky, Montana, in 2000 as a ski resort for millionaires looking for vacation homes. Members paid $205 million for 72 properties in 2005 alone. Bloomberg News, citing a court ruling by U.S. Bankruptcy Judge Ralph B. Kirscher, says the couple took cash for their personal use from a $375 million loan arranged by Credit Suisse. Finances at the club deteriorated thereafter, and the club eventually went bankrupt, Judge Kirscher found. Mr. Blixseth was ordered to pay $40 million to the club's creditors under a September ruling by Judge Kirscher. Mr. Blixseth said he's appealing that judgment. About Edra D. Blixseth Edra D. Blixseth owns the Porcupine Creek Golf Club in Rancho Mirage and the Yellowstone Club in Montana. Ms. Blixseth filed for Chapter 11 bankruptcy protection on March 26, 2009 (Bankr. D. Mont. Case No. 09-60452). Gary S. Deschenes, Esq., at Deschenes & Sullivan Law Offices assists Ms. Blixseth in her restructuring efforts. The Debtor estimated $100 million to $500 million in assets and $500 million to $1 billion in debts. The Debtor's case was converted from a Chapter 11 to a Chapter 7 by Court order entered May 29, 2009. About Yellowstone Mountain Located near Big Sky, Montana, Yellowstone Mountain Club LLC -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Club and its affiliates filed for Chapter 11 bankruptcy on Nov. 10, 2008 (Bankr. D. Montana, Case No. 08- 61570). The Company's owner affiliate, Edra D. Blixseth, filed for Chapter 11 on March 27, 2009 (Case No. 09-60452). In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners, LLC, acquired equity ownership in the reorganized Club for $115 million. Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC represented the Debtors. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer, as counsel, and James H. Cossitt, Esq., at local counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. TN-K ENERGY: Reports $596,800 Net Income in First Quarter --------------------------------------------------------- TN-K Energy Group, Inc., filed its quarterly report on Form 10-Q, reporting net income of $596,814 on $380,782 of revenues for the three months ended March 31, 2011, compared with net income of $223,550 on $220,936 of revenues for the same period last year. Included in total other income during the first quarter 2011 and the first quarter 2010 are non-cash gains on derivatives of $604,774 and $286,878, respectively. The Company's balance sheet at March 31, 2011, showed $3.28 million in total assets, $9.45 million in total liabilities, and a stockholders' deficit of $6.17 million. As reported in the TCR on April 26, 2011, Sherb & Co., LLP, in New York City, expressed substantial doubt about TN-K Energy's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred recurring operating losses and will have to obtain additional financing to sustain operations. A copy of the Form 10-Q is available at http://is.gd/jdBJeB Crossville, Tenn.-based TN-K Energy Group, Inc., an independent oil exploration and production company, engaged in acquiring oil leases and exploring and developing crude oil reserves and production in the Appalachian basin. TOUSA INC: Wants to Use Lenders' Cash Collateral Beyond June 1 -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida will convene a hearing on May 25, 2011 at 9:30 a.m., to consider the request of TOUSA, Inc., and its debtor-affiliates, to access the cash collateral of their prepetition lenders after June 1, 2011. On April 13, the Court authorized the Debtors, in an eighth final order, to use the lenders' cash until May 31. Citicorp North America, Inc., and Wells Fargo Bank, N.A., as first and second lien administrative agents to the prepetition lenders, consented to the Debtors use of the cash collateral. The Debtors would use the cash collateral to complete the implementation of their wind-down business plan and continue to fund the administrative expenses of the Chapter 11 cases. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will grant the prepetition lenders replacement liens, adequate protection and super priority administrative expense. The Debtors related that they have not finalized the terms of the cash collateral because they are still in discussions with the prepetition lenders and the Creditors' Committee regarding the continued use of cash collateral. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA, Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on Jan. 29, 2008 (Bankr. S.D. Fla. Case No. 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Cars LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. The official committee of unsecured creditors has filed a proposed chapter 11 liquidating plan for Tousa. However, the committee said that it no longer intends to pursue approval of its liquidation plan because of the pending appeal of its fraudulent transfer case in the U.S. Court of Appeals for the Eleventh Circuit. A district court in February 2011 held that the bankruptcy judge was wrong in ruling that lenders who were paid off received fraudulent transfers when Tousa gave liens on subsidiaries' properties to bail out and refinance a joint venture. Daniel H. Golden, Esq., and Philip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, represent the creditors committee. TOUSA TEXAS: Sells 71 Acres of Land to Michael Rose for $500,000 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized TOUSA Texas, L.P., as debtor-affiliate of TOUSA, Inc., to sell approximately 71 acres of land situated in Harris County, Texas to Michael Rose for $500,000. The property is comprised of 395 unfinished single family lots. The Debtor related that the borrowing base value attributed to the property ($798,450) exceeds the cash purchase price. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA, Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on Jan. 29, 2008 (Bankr. S.D. Fla. Case No. 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Cars LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It estimated assets and debts of $1 million to $10 million in its Chapter 11 petition. The official committee of unsecured creditors has filed a proposed chapter 11 liquidating plan for Tousa. However, the committee said that it no longer intends to pursue approval of its liquidation plan because of the pending appeal of its fraudulent transfer case in the U.S. Court of Appeals for the Eleventh Circuit. A district court in February 2011 held that the bankruptcy judge was wrong in ruling that lenders who were paid off received fraudulent transfers when Tousa gave liens on subsidiaries' properties to bail out and refinance a joint venture. Daniel H. Golden, Esq., and Philip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, represent the creditors committee. TRAILER BRIDGE: Incurs $10.39 Million Net Loss in First Quarter --------------------------------------------------------------- Trailer Bridge, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $10.39 million on $24.81 million of operating revenues for the three months ended March 31, 2011, compared with a net loss of $307,569 on $28.84 million of operating revenues for the same period a year ago. The Company's balance sheet at March 31, 2011, showed $109.11 million in total assets, $119.59 million in total liabilities, and a $10.48 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/bbGCJ0 About Trailer Bridge Jacksonville, Fla.-based Trailer Bridge, Inc., is an integrated trucking and marine freight carrier that provides freight transportation between the continental U.S., Puerto Rico and the Dominican Republic. BDO USA, LLP, in Miami, Fla., expressed substantial doubt about Trailer Bridge's ability to continue as a going concern. The independent auditors noted that the Company has a significant working capital deficit resulting from the current maturities of long term debt. The Company reported a net loss of $2.3 million on $118.2 million of revenues for 2010, compared with net income of $2.6 million on $114.3 million of revenues for 2009. TRIAD GUARANTY: Confirms 2011 Performance Goals ----------------------------------------------- The Compensation Committee of the Board of Directors of Triad Guaranty Inc. confirmed the corporate and individual performance goals that will be used to assess each named executive officer's eligibility for an annual performance-based cash incentive award for the year ending Dec. 31, 2011. The performance-based cash incentive award is designed to recognize the accomplishment of key corporate and individual performance goals. Targeted cash incentive awards have been established and are based on the value of the contributions of the named executive officer's position. Using the relative weightings of goals as a benchmark, the weighting for each named executive officer was determined based on their individual responsibility towards the attainment of the respective corporate goal. At the conclusion of the year, the performance versus the goals will be assessed. The performance against each goal, and the weighting of the goal for each individual, will determine the percentage of the incentive compensation target that is earned. However, the Committee retains the right to award an amount greater than the target to any specific individual if that individual's performance merits such action. For the year ending Dec. 31, 2011, the Committee has approved the following corporate performance goals: (i) manage the Company's run-off in a manner that maintains positive relations with, and the support of, the Illinois Department of Insurance and key policyholders; (ii) pursue opportunities to settle or commute large blocks of risk where the settlement improves the outcome of the run-off plan; (iii) efficiently and effectively administer the Company's master policies to assure timely payment of all valid claims; (iv) reduce expenses while maintaining efficient and effective operations; (v) maintain a talented and motivated staff to successfully manage the run-off plan; and (vi) analyze and develop a plan to maximize the value of existing assets and infrastructure. For each of the named executive officers, the following corporate goals were deemed to be the most important in their individual assessments: Kenneth W. Jones (President, Chief Executive Officer and Principal Financial Officer) - In addition to the overall executive leadership responsibilities associated with accomplishing the Company's corporate goals, the Committee deemed these three goals as the most important (in order of weighting) for Mr. Jones: (i) analyze and develop a plan to maximize the value of existing assets and infrastructure; (ii) manage the Company's run-off in a manner that maintains positive relations with, and the support of, the Department and key policyholders; and (iii) pursue opportunities to settle or commute large blocks of risk where the settlement improves the outcome of the run-off plan. Earl F. Wall (Senior Vice President, Secretary and General Counsel) - The Committee deemed these three goals as the most important (in order of weighting) for Mr. Wall: (i) pursue opportunities to settle or commute large blocks of risk where the settlement improves the outcome of the run-off plan; (ii) efficiently and effectively administer the Company's master policies to assure timely payment of all valid claims; and (iii) manage the Company's run-off in a manner that maintains positive relations with, and the support of, the Department and key policyholders. Shirley A. Gaddy (Senior Vice President, Operations) - The Committee deemed these three goals as the most important (in order of weighting) for Ms. Gaddy: (i) efficiently and effectively administer the Company's master policies to assure timely payment of all valid claims; (ii) reduce expenses while maintaining efficient and effective operations; and (iii) maintain a talented and motivated staff to successfully manage the run-off plan. For each of our named executive officers, a minimum bonus opportunity is available as a "retention guarantee" during 2011 - in other words, the minimum annual cash incentive award set forth below is automatically earned by each named executive officer who remains in a key position for the Company's ongoing operations at Dec. 31, 2011 or who is involuntarily terminated without cause during 2011. The 2011 minimum annual cash incentive award and targeted annual cash incentive award for each of our named executive officers is set forth below: Mr. Jones: Minimum of $95,000 and target of $190,000. Mr. Wall: Minimum of $62,500 and target of $125,000. Ms. Gaddy: Minimum of $50,000 and target of $100,000. As part of the Company's retention efforts, each of the named executive officers, if he or she is actively working for and in good standing with the Company, is entitled to receive 5% of his or her annual base salary in July 2011 as an advance payment on the minimum annual cash incentive award noted above. Grant of Restricted Stock Pursuant to the Company's 2006 Long-Term Stock Incentive Plan, the Board approved a grant of 30,000 shares of restricted stock to Mr. Jones on May 18, 2011, that was valued at $0.23 per share, based upon the closing price of the Company's common stock as quoted on the OTC Bulletin Board(R) at the close of business on May 18, 2011. These shares of restricted stock will vest on May 17, 2012. In connection with the grant of restricted stock, Mr. Jones' targeted annual cash incentive award for 2011 was reduced from $200,000 to $190,000. The Company's Annual Meeting of Stockholders was held on May 19, 2011. Shares entitled to vote at the Annual Meeting totaled 15,258,128, of which 12,516,840 shares were represented. These five directors were elected at the Annual Meeting: (1) H. Lee Durham, Jr. (2) Deane W. Hall (3) Kenneth W. Jones (4) William T. Ratliff, III (5) David W. Whitehurst Stockholders also voted to amend the Company's certificate of incorporation to establish restrictions on the transfer of the Company's common stock to avoid an "ownership change" under Section 382 of the Internal Revenue Code of 1986, as amended, and thereby help preserve certain tax benefits. Stockholders also voted to approve the Triad Guaranty Inc. Tax Benefits Preservation Plan, as adopted by the Board on Sept. 13, 2010. Stockholders also voted to ratify the appointment of Ernst & Young LLP as the Company's independent registered public accounting firm for the year ending Dec. 31, 2011. About Triad Guaranty Winston-Salem, N.C-based Triad Guaranty Inc. (OTC BB: TGIC) -- http://www.triadguaranty.com/-- is a holding company that historically provided private mortgage insurance coverage in the United States through its wholly-owned subsidiary, Triad Guaranty Insurance Corporation. TGIC is a nationwide mortgage insurer pursuing a run-off of its existing in-force book of business. The Company's balance sheet at Dec. 31, 2010, showed $991.62 million in total assets, $1.57 billion in total liabilities and $586.20 million in deficit in assets. Ernst & Young LLP expressed substantial doubt about the Company's ability to continue as a going concern. The Company is operating the business in run-off under Corrective Orders with the Illinois Department of Insurance and has reported a stockholders' deficiency in assets at Dec. 31, 2010. TRITON AVIATION: Fitch Affirms C Rating on Four Classes of Notes ---------------------------------------------------------------- Fitch Ratings has affirmed all classes in Triton Aviation Finance (TAF): -- Class A-1 notes at 'Bsf', Outlook Stable; -- Class B-1, B-2, C-1, and C-2 notes at 'Csf/RR6'. The affirmation of all notes in TAF reflects credit risk that is consistent with their current ratings. The class A-1 notes pass under Fitch's 'Bsf' scenario while the subordinate notes are not expected to receive material cash flow. The analysis of TAF is consistent with Fitch Rating's criteria titled 'Global Rating Criteria for Aircraft Operating Lease ABS', dated April 25, 2011, with these exceptions: -- While the criteria states that Fitch will assume all aircraft have a useful life of 25 years, this was adjusted to 30 years based on the characteristics of the current leases in place. -- All recessionary value decline assumptions except for the tier 1 aircraft in the 'Bsf' scenario were decreased by 5% from representative ranges in order to reflect the currently depressed values of aviation equipment and lease rates from the recent downturn. TRUMP ENTERTAINMENT: Landry's Wins OK to Buy Trump Marina Casino ---------------------------------------------------------------- Carla Main at Bloomberg News reported that Landry's Inc., owner of Nevada's Golden Nugget casinos, won regulatory approval to buy the Trump Marina Hotel Casino, becoming Atlantic City's newest investor. The New Jersey Casino Control Commission approved an interim license, clearing the way for Houston-based Landry's to buy the money-losing casino for $38 million from Trump Entertainment Resorts Inc. Landry's, which owns restaurants including the Bubba Gump Shrimp Co., will change the name to Golden Nugget and spend about $100 million on the acquisition and initial renovation, executives said. The company is already adding its restaurants and plans a new hotel tower, Chief Executive Officer Tilman Fertitta told the commission in Atlantic City. The sale comes as Atlantic City struggles to reverse record gambling declines. About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the Company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC, and other affiliates filed for Chapter 11 protection on Feb. 17, 2009 (Bankr. D. N.J. Lead Case No. 09-13654). The Company tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP served as the Company's auditor and accountant and Lazard Freres & Co. LLC was the financial advisor. Garden City Group was the claims agent. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of Dec. 31, 2008. Trump Hotels & Casino Resorts, Inc., filed for Chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No. 04-46898 through 04-46925). Trump Hotels obtained the Court's confirmation of its Chapter 11 plan on April 5, 2005, and in May 2005, it exited from bankruptcy under the name Trump Entertainment Resorts Inc. UDI PROPERTIES: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: UDI Properties, LLC 41539 Kalmia Street Murrieta, CA 92562 Bankruptcy Case No.: 11-27126 Chapter 11 Petition Date: May 25, 2011 Court: U.S. Bankruptcy Court Central District of California (Riverside) Judge: Catherine E. Bauer Debtor's Counsel: Stuart J. Wald, Esq. LAW OFFICES OF STUART J. WALD 36154 Coffee Tree Place Murrieta, CA 92562 Tel: (310) 429-3354 E-mail: stuart.wald@gmail.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The list of unsecured creditors filed together with its petition does not contain any entry. The petition was signed by Abraham (Avi) Greenboim, managing member. UNITY HOUSE: Judge Approves Sale of Assets for $18.5 Million ------------------------------------------------------------ Unity House Inc. received approval from a Hawaii bankruptcy court judge to sell its Lotus at Diamond Head Hotel to Nobuka USA Inc. for $18.5 million. Bill Rochelle, the bankruptcy columnist for Bloomberg News, notes that the sale was approved without an auction. The owner said there would have been no purpose in searching for a better offer, only more expense. The Pacific Business News reports that as part of the sale, Unity House will purchase the fee interest on the parcel of land on which the hotel is located and include it with the 51-room Lotus at Diamond Head. Unity House will buy the fee interest on the land from Bank of Hawaii Trust Real Estate for $5.6 million. Jim Boersema, Unity House's chairman, told PBN that the sale of the hotel and land must be concluded by July 15, and that he expects the Honolulu nonprofit will emerge from Chapter 11 bankruptcy after the sale is completed. According to Bloomberg News, the property wasn't generating enough to pay debt service on the mortgage that was $5.9 million when the lender MK Pacific LLC was foreclosing earlier this year. The mortgage matured last year. The hotel's revenue varied from $160,000 to $221,000 a month. Operating expenses ranged from $62,000 to $71,000, according to a court filing. About Unity House Unity House Inc. owns The Lotus at Diamond Head in Hawaii. United House is a social-welfare organization for benefit of members of the Teamsters union. In pursuing repayment of a $5.5 million loan, MK Pacific LLC filed a foreclosure lawsuit against Unity House in February and a receiver was appointed in the case in March. Unity House filed a Chapter 11 petition (Bankr. D. Hawaii Case No. 11-01032) on April 13, 2011. Donald L. Spafford, Jr., Esq., in Honolulu, Hawaii, serves as counsel to the Debtor. The Debtor estimated assets and debts of $1 million to $10 million. UNO RESTAURANT: Velina Exum Suit Not "Related To" Bankruptcy ------------------------------------------------------------ Bankruptcy Judge Paul Mannes held that a wrongful death and survivorship action filed in the Circuit Court for Prince George's County, Maryland, arising out of events occurring Feb. 3, 2008, styled Velina Exum, as Personal Representative of the Estate of Curtis Lee Poston, Deceased, et al. v Uno Restaurant Holdings Corporation, et al., Case No. CAL 11-01261, is not "related to" Uno's bankruptcy case. The close nexus required to establish "related to" jurisdiction is nonexistent. A copy of the Court's May 20, 2011 Memorandum of Decision is available at http://is.gd/AfU36Dfrom Leagle.com. About Uno Restaurant Boston, Massachusetts-based Uno Restaurant Holdings Corporation -- http://www.unos.com/-- has 179 company-owned and franchised full-service Uno Chicago Grill restaurants located in 28 states, the District of Columbia, Puerto Rico, South Korea, the United Arab Emirates, Honduras, Kuwait, and Saudi Arabia. The company also operates a fast casual concept called Uno Due Go(R), a quick serve concept called Uno Express, and a consumer foods division which supplies airlines, movie theaters, hotels, airports, travel plazas, schools and supermarkets with both frozen and refrigerated private-label foods and branded Uno products. The Company and 152 affiliates filed for Chapter 11 protection on Jan. 20, 2010 (Bankr. S.D.N.Y. Lead Case No. 10-10209). The Company estimated its assets and debts at $100 million to $500 million as of the Petition Date. Weil, Gotshal & Manges LLP assisted the Debtors in their restructuring effort. CRG Partners Group LLC served as the restructuring advisor. Kurtzman Carson Consultants LLC served as noticing and claims agent. As reported by the Troubled Company Reporter on July 27, 2010, Uno Restaurant emerged from Chapter 11 pursuant to its plan of reorganization, confirmed by the Bankruptcy Court on July 6. Pursuant to the Plan, 100% of the Company's $142 million, 10% Senior Secured Notes, due February 2011, was converted into substantially all of the equity of the Company, thereby eliminating $14.2 million in annual interest payments and reducing total debt from $176.3 million to approximately $40 million. In connection with the emergence from Chapter 11, the Company arranged for $55 million of permanent, long-term exit financing comprised of a $30 million revolving credit facility, due July 2015, provided by long-standing-lender Wells Fargo Capital Finance, part of Wells Fargo & Company, and $25 million of new notes, due February 2016, provided by a majority of the new equity holders. The Exit Facility allowed the Company to repay all outstanding amounts under its former Debtor in Possession Credit Facility, implement the provisions of the Plan, pay transaction costs and provide significant liquidity going forward to fund working capital needs and the Company's growth and investment plans. USA BABY: May Not to Pursue Speculative Claims, 7th Cir. Says ------------------------------------------------------------- Creditors forced USA Baby, a closely held corporation, into bankruptcy, and a trustee was appointed. The trustee declined to pursue unliquidated, speculative claims, a decision that was opposed by no one except Scott Wallis, the company's president and a 5% stockholder. Mr. Wallis, acting on his own and not as an officer of USA Baby, moved for permission to stand in for the trustee to pursue those claims. The bankruptcy court denied Mr. Wallis's motion, and the district court upheld that decision. Mr. Wallis appealed. The U.S. Court of Appeals for the Seventh Circuit affirmed the lower court's decision in a May 25, 2011 Order. "We cannot conclude from this record that [the trustee] failed to exercise sound business judgment in his decision not to pursue the claims Wallis envisions against the franchisees and others," the Seventh Circuit held. The panel consists of Circuit Judges Richard A. Posner, John L. Coffey, and Joel M. Flaum. The trustee, Barry Chatz, elected not to pursue the claims because USA Baby did not have the money or a backer to finance collection activity, and because no law firm would take the claims on a contingency basis given the remote possibility of success. Commerce Capital, the creditor that would benefit most from receivables that USA Baby might recover, agreed with Mr. Chatz that the risk of pursuing these claims was too great. No other creditors, or USA Baby itself, objected to Commerce Capital's request for relief from the stay or to Mr. Chatz's no asset statement. The Seventh Circuit held that while Mr. Wallis continues to assert that he believes he could collect on the accounts receivable, he offered the bankruptcy court no basis to rely on this assessment. "Nowhere in this record do we see any evidence that Wallis ever has tried to quantify specific amounts due from particular persons, or identify bases for making claims against those persons, or assess the likelihood of recovery. Nor is there any evidence even remotely supporting his allegations of a conspiracy or conflicts of interest by Chatz," the Seventh Circuit said. A copy of the Seventh Circuit's ruling is available at http://is.gd/ly1sWefrom Leagle.com. About USA Baby Based in Lombard, Illinois, USA Baby Inc. sold infant & children's furniture. USA Baby was formed in 2003 to franchise stores selling furniture and other products for babies and children. It operated no stores of its own. On Sept. 5, 2008, three creditors, Wallis Kraham of Binghamton, N.Y., Jack B. Whisler of Arlington Heights, Ill., and Leslie Ruess of San Diego, filed an involuntary Chapter 11 petition (Bankr. N.D. Ill. Case No. 08-23564), claiming breach of subscription agreement and seeking $122,875 in the aggregate. Abraham Brustein, Esq., at Dimonte & Lizak, LLC, represented Wallis Kraham, one of the petitioning creditors. The bankruptcy court entered an order for relief, leaving USA Baby in possession of the bankruptcy estate, but the corporation did not file the required bankruptcy schedules or statements. A group of franchisees, citing that failure and alleging a history of prepetition mismanagement by Scott Wallis, the company's president and a 5% stockholder, asked the bankruptcy court to appoint a trustee and convert the case to Chapter 7. While those motions were pending, the company filed a statement of affairs and the required schedules. The bankruptcy court appointed Barry Chatz as trustee but denied the franchisees' motion for conversion to Chapter 7. Days later, though, Mr. Chatz filed his own motion for conversion, citing lack of funding. The bankruptcy court converted the case but also allowed Mr. Chatz to continue operations for a limited time. VILLA BELLAGIO: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Villa Bellagio Estates LLC 1931 Lock Haven Way Claremont, CA 91711 Bankruptcy Case No.: 11-33048 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Ernest M. Robles Debtor's Counsel: Nolan E. Clark 2001 Financial Way #102 Glendora, CA 91741-4602 Tel: (626) 914-2605 Scheduled Assets: $859,572 Scheduled Debts: $2,752,558 A list of the Company's six largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb11-33048.pdf The petition was signed by Nolan E. Clark, manager. V.I.P. ELECTRIC: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: V.I.P. Electric Company 8358 Mentor Avenue Mentor, OH 44060 Tel: (440) 255-0180 Bankruptcy Case No.: 11-14534 Chapter 11 Petition Date: May 26, 2011 Court: U.S. Bankruptcy Court Northern District of Ohio (Cleveland) Judge: Randolph Baxter Debtor's Counsel: Harry W. Greenfield, Esq. BUCKLEY KING, LPA 600 Superior Avenue, East 1400 Fifth Third Center Cleveland, OH 44114 Tel: (216) 363-1400 Fax: (216) 579-1020 E-mail: bankpleadings@bucklaw.com - and - Heather E. Heberlein, Esq. BUCKLEY KING, LPA 600 Superior Avenue, East 1400 Fifth Third Center Cleveland, OH 44114 E-mail: heberlein@buckleyking.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/ohnb11-14534.pdf The petition was signed by Kevin Vayo, vice president. VISUALANT, INC: Obtains $1MM Financing from Gemini & Ascendiant --------------------------------------------------------------- Visualant, Inc., closed a $1.0 million financing. The financing, led by Gemini Strategies LLC of San Diego, CA and New York, and Ascendiant Capital Partners LLC of Irvine, CA, provides capital for Visualant to continue with the execution of its strategic plans, including the funding of its planned acquisitions and the market development of its Spectral Pattern Matching Technology. The financing, in the form of a 10% convertible debenture, has a floor conversion price of $0.35 per share subject to adjustment and includes warrants for 2.4 million shares that are exercisable at a price of $0.50 per share for five years. The financing provides for an additional $1.0 million investment option within the one year agreement at $1.00 per share and has a floor conversion price of $.70 per share subject to adjustment. "We are pleased to secure the support of Gemini Strategies and Ascendiant Capital Partners," said Ron Erickson, Visualant CEO. "Their investment provides the resources for Visualant to accelerate the execution of our growth plans." About Visualant Inc. Seattle, Wash.-based Visualant, Inc., was incorporated under the laws of the State of Nevada on October 8, 1998. The Company develops low-cost, high speed, light-based security and quality control solutions for use in homeland security, anti- counterfeiting, forgery/fraud prevention, brand protection and process control applications. The Company's balance sheet at March 31, 2011 showed $4.63 million in total assets, $6.13 million in total liabilities, a $1.54 million total stockholders' deficit and $47,739 noncontrolling interest. As reported in the Troubled Company Reporter on Jan. 4, 2011, Madsen & Associates CPA's, Inc., Salt Lake City, expressed substantial doubt about Visualant, Inc.'s ability to continue as a going concern, following the Company's results for the fiscal year ended September 30, 2010. The independent auditors noted that the Company will need additional working capital for its planned activity and to service its debt. VITA PARTNERS: Owes $2 Million From Two Landlords ------------------------------------------------- Paolo Lucchesi at The San Francisco Chronicle reports taht public records of Vita Partners LLC indicate that the biggest unsecured claim is $2 million from the landlords, Charles Crocker and the estate of the late John Traina. According to the report, Vita has 120 days to propose a restructuring plan to the creditors and court. Possible outcomes could include opening the restaurant at its original location or opening it somewhere else. Based in Yountville, California, Vita Partners LLC filed for Chapter 11 bankruptcy protection (Bankr. N.D. Calif. Case No. 11- 11708) on May 6, 2011. Judge Alan Jaroslovsky presides over the case. Debra I. Grassgreen, Esq., and Maxim B. Litvak, Esq., at Pachulski, Stang, Ziehl, and Jones LLP, represent the Debtor. The Debtor estimated both assets and debts of between $1 million and $10 million. VU1 CORPORATION: Posts $1.2 Million Net Loss in Q1 2011 ------------------------------------------------------- Vu1 Corporation filed its quarterly report on Form 10-Q, reporting a net loss of $1.24 million for the three months ended March 31, 2011, compared with net income of $62,780 for the same period last year. The Company had no revenues for the three months ended March 31, 2011, and 2010. Derivative valuation gain amounted to approximately $341,132 during the three months ended March 31, 2011, compared to derivative valuation gain of $1.14 million for the three months ended March 31, 2010. The Company's balance sheet at March 31, 2011, showed $3.05 million in total assets, $2.34 million in total liabilities, and stockholders' equity of $709,976. As reported in the TCR on April 11, 2011, Peterson Sullivan, LLP, in Seattle, Wash., expressed substantial doubt about Vu1 Corporation's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company incurred a net loss of $4,626,250, and it had negative cash flows from operations of $3,529,351 in 2010. "In addition, the Company had an accumulated deficit of $70,499,569 at Dec. 31, 2010." A copy of the Form 10-Q is available at http://is.gd/xM0Fsu New York City-based Vu1 Corporation (OTC BB: VUOC) -- http://www.Vu1.com/-- designs, develops and manufactures mercury-free light bulbs using the Company's proprietary Electron Stimulated Luminescence(TM), or ESL, lighting technology. VYTERIS INC: John Burrows Resigns as Director --------------------------------------------- John Burrows has resigned as a director of Vyteris, Inc., effective May 19, 2011, to pursue other business interests. Mr. Burrows did not submit a written resignation and did not give any reason for resignation other than the foregoing. In connection with his resignation, options to purchase Company's common stock previously issued to Mr. Burrows will retain their original expiration dates of 10 years from their original date of issuance, and any options, which have not yet vested, will immediately vest. Additionally, any cash directors' fees for service as a director during 2010 and 2011 will be paid simultaneously with the payment of 2010 and 2011 directors' fees to the continuing directors on the Company's Board of Directors. About Vyteris, Inc. Based in Fair Lawn, New Jersey, Vyteris, Inc. (formerly Vyteris Holdings (Nevada), Inc., has developed and produced the first FDA- approved electronically controlled transdermal drug delivery system that transports drugs through the skin comfortably, without needles. This platform technology can be used to administer a wide variety of therapeutics either directly into the skin or into the bloodstream. The Company holds approximately 50 U.S. and 70 foreign patents relating to the delivery of drugs across the skin using an electronically controlled "smart patch" device with electric current. The Company reported a net loss of $10.54 million on $117,792 of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $33.94 million on $4.56 million of total revenues during the prior year. As reported by the TCR on April 21, 2011, Amper, Politziner & Mattia, LLP, in Edison, New Jersey, expressed substantial doubt about the Company's ability to continue as going concern, following the 2010 financial results. The independent auditors noted that the Company has incurred recurring losses and is dependent upon obtaining sufficient additional financing to fund operations and has not been able to meet all of its obligations as they become due. The Company's balance sheet at March 31, 2011, showed $2.52 million in total assets, $15.39 million in total liabilities and a $12.86 million total stockholders' deficit. W&K STEEL: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: W&K Steel, LLC 98 Antisbury Place Rankin, PA 15104 Bankruptcy Case No.: 11-23355 Chapter 11 Petition Date: May 26, 2011 Court: U.S. Bankruptcy Court Western District of Pennsylvania (Pittsburgh) Debtor's Counsel: Kevin J. McKeon, Esq. WATT, TIEDER, HOFFAR & FITZGERALD, LLP 8405 Greensboro Drive, Suite 100 McLean, VA 22102 Tel: (703) 749-1000 Fax: (703) 893-8029 E-mail: kmckeon@wthf.com Estimated Assets: $500,001 to $1,000,000 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/pawb11-23355.pdf The petition was signed by Edward C. Wilhelm, Jr., member-manager. WAGLE VENTURES: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Wagle Ventures, Inc. 32 Rancho Circle Lake Forest, CA 92630 Bankruptcy Case No.: 11-17406 Chapter 11 Petition Date: May 25, 2011 Court: United States Bankruptcy Court Central District of California (Santa Ana) Judge: Mark S. Wallace Debtor's Counsel: Bryan L. Ngo, Esq. BLUE CAPITAL LAW FIRM, P.C. 14441 Brookhurst St Ste 8 Garden Grove, CA 92843 Tel: (714) 839-3800 Fax: (949) 271-5788 E-mail: bngo@bluecapitallaw.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 three largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb11-17406.pdf The petition was signed by Sunil Wagle, president. WARNER MUSIC: Receives Requisite Consents to Amend 2009 Indenture ----------------------------------------------------------------- WMG Acquisition Corp., a wholly owned subsidiary of Warner Music Group Corp., solicited consents, upon the terms and subject to the conditions set forth in the Notice of Consent Solicitation dated May 13, 2011, to amend the indenture, dated as of May 28, 2009, by and among the Company, the guarantors named therein and Wells Fargo Bank, National Association, as trustee, pursuant to which the 9.50% Senior Secured Notes Due 2016 were issued. The purpose of the Consent Solicitation was to amend the Indenture in connection with the Agreement and Plan of Merger, dated as of May 6, 2011, by and among Airplanes Music LLC, an affiliate of Access Industries, Inc., Airplanes Merger Sub, Inc., a wholly owned subsidiary of Airplanes Music LLC, and Warner Music Group, pursuant to which Airplanes Merger Sub, Inc., will be merged with and into WMG upon the terms and subject to the conditions set forth in the Merger Agreement, to permit Access Industries and certain related persons to be "Permitted Holders" so that the Merger would not constitute a "Change of Control". On May 23, 2011, valid consents from holders of a majority in aggregate principal amount of the outstanding Notes were received and not withdrawn, and the Consent Solicitation has expired. Upon receipt of the Requisite Consents, the Company, the guarantors and the Trustee executed a supplemental indenture to effect the proposed amendments to the Indenture. On the terms and subject to the conditions of the Consent Solicitation, the proposed amendments will not become operative until all conditions to the Consent Solicitation, including, without limitation, consummation of the Merger, have been satisfied. The Supplemental Indenture will bind all holders of Notes and their transferees. The Company engaged Credit Suisse Securities (USA) LLC and UBS Securities LLC as its solicitation agents. Questions and requests for assistance regarding the Consent Solicitation should be directed to Credit Suisse Securities (USA) LLC at (212) 538-1862 or (800) 820-1653 (toll free) or UBS Securities LLC at (203) 719- 4210 (call collect) or (888) 719-4210 (toll free). Requests for documents may be directed to Global Bondholder Services Corporation, which acted as the information agent for the Consent Solicitation, at (866) 470-3700 (toll free) or (212) 430-3774 (banks and brokers). About Warner Music Group Based in New York, Warner Music Group Corp. (NYSE: WMG) -- http://www.wmg.com/-- was formed by a private equity consortium of investors on Nov. 21, 2003. The Company is the direct parent of WMG Holdings Corp., which is the direct parent of WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's major music-based content companies and the successor to substantially all of the interests of the recorded music and music publishing businesses of Time Warner Inc. The Company classifies its business interests into two fundamental operations: Recorded Music and Music Publishing. The Company's Recorded Music business primarily consists of the discovery and development of artists and the related marketing, distribution and licensing of recorded music produced by such artists. The Company's Music Publishing operations include Warner/Chappell, its global Music Publishing company, headquartered in New York with operations in over 50 countries through various subsidiaries, affiliates and non-affiliated licensees. Warner Music reported a net loss of $39 million on $682 million of revenue for the three months ended March 31, 2011, compared with a net loss of $28 million on $666 million of revenue for the same period during the prior year. The Company also reported a net loss of $57 million on $1.47 billion of revenue for the six months ended March 31, 2011, compared with a net loss of $44 million on $1.58 billion of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2011, showed $3.61 billion in total assets, $3.87 billion in total liabilities and a $254 million in total deficit. * * * In May 2011, Warner Music Group Corp. and Access Industries, the U.S.-based industrial group, announced the execution of a definitive merger agreement under which Access Industries will acquire WMG in an all-cash transaction valued at $3.3 billion. The purchase includes WMG's entire recorded music and music publishing businesses. WASHED AGGREGATE: Case Summary & 13 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Washed Aggregate Resources, Inc. 14 Kettle Creek Road Weston, CT 06883 Bankruptcy Case No.: 11-21588 Chapter 11 Petition Date: May 26, 2011 Court: U.S. Bankruptcy Court District of Connecticut (Hartford) Debtor's Counsel: Timothy D. Miltenberger, Esq. COAN LEWENDON GULLIVER & MILTENBERGER 495 Orange Street New Haven, CT 06511 Tel: (203) 624-4756 Fax: 203-243-4488 E-mail: tmiltenberger@coanlewendon.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 A list of the Company's 13 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/ctb11-21588.pdf The petition was signed by Henry Bromberger, member. WASHINGTON LOOP: ROBI1956 Wants Cash Collateral Use Request Denied ------------------------------------------------------------------ Creditor ROBI1956, LLC, asks the U.S. Bankruptcy Court for the Middle District of Florida to deny Washington Loop, LLC's request to use the cash collateral. ROBI has a lien upon the Debtor's rents and profits of the property. ROBI's collateral includes a mortgage and assignment of rents upon the Debtor's real estate. ROBI is also a holder of judgment of $6,878,742 plus interest. ROBI explains that the Debtor seeks authority to use $245,000 to $8,000,000 worth of cash collateral within the next six months. The source of cash would presumably be sales of dirt. ROBI adds that the type of the Debtor's operation has the potential to significantly decrease the value of ROBI's collateral. The Debtor only proposed to give ROBI replacement lien in its property but did propose to make adequate protection payments. About Washington Loop, LLC 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 disclosed $45,098,259 in assets and $19,703,694 in liabilities as of the Chapter 11 filing. 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. 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. WATERFORD HOTEL: Holiday Inn in Michigan Files for Chapter 11 ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the owner of the Holiday Inn Express in Waterford, Michigan, filed for Chapter 11 protection, owing $4.55 million to the secured lender Dawn-G LLC. The real estate and fixtures are valued at $2 million, according to a court filing. Waterford Hotel Inc. filed a Chapter 11 petition (Bankr. E.D. Mich. Case No. 11-54788) in Detroit on May 25. WCK INC: Secured Creditor Wants Cash Collateral Access Denied ------------------------------------------------------------- State Bank of India California, asks with the U.S. Bankruptcy Court for the Central District of California to deny WCK Inc.'s requested access to the cash collateral. Secured creditor SBIC explains that it has not consented to the Debtor's use of he cash collateral because the Debtor's bankruptcy was filed in bad faith for the sole purpose of avoiding the appointment of a receiver and avoiding the foreclosure of the hotel property. SBIC is represented by: Stephen E. Jenkins, Esq. HEMAR, ROUSSO & HEALD, LLP 15910 Ventura Boulevard, 12th Floor Encino, CA 91436-2829 Tel: (818) 501-3800 Fax: (818) 501-3985 About WCK, Inc. WCK, Inc., dba Four Points by Sheraton, in Diamond Bar, California, filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 11-28047) on April 26, 2011. Judge Peter Carroll presides over the case. John Eom, Esq., at Wilshire One Law Group, serves as bankruptcy counsel. The Debtor disclosed $17,260,570 in assets and $17,099,000 in liabilities as of the Chapter 11 filing. WELLINGTON PRESERVE: Sale Approved; Liquidating Plan Confirmed -------------------------------------------------------------- The Hon. Erik P. Kimbal of the U.S. Bankruptcy Court for the Southern District of Florida confirmed the Second Amended Plan of Liquidation as of April 22, 2011, proposed by Wellington Preserve Corporation and creditor Clico Enterprises, Ltd. The Court also approved the three separate real estate transactions whereby the Debtor is selling all of its real estate holdings and development rights, for the total gross sales price (before direct closing costs) of $50,000,000. The purchasers are Zacara Farms, LLC, which has contracted to purchase 102.74 acres; members of the Tanen family, who have agreed to exchange the Debtor's parcels 23B and 24B for lots 24C and 25C currently owned by the Tanen's and J-5 Wellington Preserve, LLC, which has contracted to purchase 420.841 acres, together with development rights. The Plan also provides, for treatment of the entire Internal Revenue Service claim as disputed; out of the first real estate closing contemplated by the Plan, the plan would reserve the entire amount of the IRS claim, plus a 10% cushion, pending the outcome of the Debtor's contemplated objection to the claim of the IRS. Treatment of Claims Class 1. Brennan Financial will receive $1,445,490, in full on the later of the Effective Date or the date the proceeds of the sale of the assets are cleared. Class 2. Allowed Mechanics Lien Creditors will receive cash in an amount equal to the amount of the Allowed Mechanics Lien Claims on the later of the Effective Date or the date the proceeds of the sale of the assets are cleared. The claims consist of: i) Alan Gerwig & Associates, Inc. - $3,532.50; ii) Dunkelberger Engineering & Testing Inc. - $801; iii) H & J Contracting Inc. - $23,059; and, iv) O'Dell, Inc. - $47,522. Class 3. Allowed Unsecured Creditors ($844,919) will receive cash in an amount equal to the allowed amount of the claim. Class 4. Allowed Unsecured Claim of Clico Enterprises Ltd. ($73,000,000) - Clico will receive any remaining balances after the satisfaction of all claims without interest. Class 6. Equity Security Holders will receive nothing and the corporation will be dissolved. A full-text copy of the Amended Plan is available for free at http://bankrupt.com/misc/WELLINGTONPRESERVE_AmendedPlan.pdf About Wellington Preserve Corporation Miami, Florida-based Wellington Preserve Corporation filed for Chapter 11 (Bankr. S.D. Fla. Case No. 10-22049) on April 27, 2010. Ronald G Neiwirth, Esq., who has an office in Miami, Florida, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $50 million to $100 million. WENDY'S/ARBY'S GROUP: S&P Affirms CCR at 'B+'; Outlook Stable ------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Altanta- based Wendy's/Arby's Group Inc. to stable from negative. "At the same time, we affirmed all ratings on the company, including the 'B+' corporate credit rating," S&P stated. "The outlook revision to stable reflects our view that credit measures should stabilize in line with the 'B+' rating as benefits from the company's menu initiatives and debt reduction should offset modest earnings softness resulting from food cost inflation," said Standard & Poor's credit analyst Andy Sookram. "We also believe that the planned sale of Arby's will be a net benefit to credit measures. The ratings reflect our opinion that Wendy's/Arby's Group has a highly leveraged financial risk profile because of high debt, thin cash flow protection measures, and our view that the company will use excess cash flow to fund shareholder initiatives and capital expenditures instead of reducing debt in excess of what is required under the credit agreement." WESTSIDE ATHLETIC: Case Summary & 14 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Westside Athletic Club, LLC dba PureFitness Downtown 501 West Broadway, Suite F San Diego, CA 92101 Bankruptcy Case No.: 11-08902 Chapter 11 Petition Date: May 27, 2011 Court: United States Bankruptcy Court Southern District of California (San Diego) Debtor's Counsel: John L. Smaha, Esq. SMAHA LAW GROUP, APC 7860 Mission Center Court, Suite 100 San Diego, CA 92108 Tel: (619) 688-1557 Fax: (619) 688-1558 E-mail: jsmaha@smaha.com Scheduled Assets: $4,936,800 Scheduled Debts: $3,773,283 A list of the Company's 14 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/casb11-08902.pdf The petition was signed by Michael London, PureFitness Holding, Inc. president. WINDMILL DURANGO: Gets OK for Flangas as Litigation Counsel ----------------------------------------------------------- Windmill Durango Office, LLC sought and received approval from the United States bankruptcy court District of Nevada of its renewed request to employ Flangas McMillan Law Group as special counsel. During its retention, Flangas McMillan employment will be limited to: (a) advising the Debtor of its state court rights and obligations and performance of its duties during administration of the bankruptcy cases; (b) representing the Debtor in all complex civil cases and related landlord/litigation proceedings before this Court or before other courts with jurisdictions over these cases; (c) assisting the Debtor in the performance of its duties as set forth in 11 U.S.C 1107 Flangas McMillan will charge the Debtors' estates in accordance with its customary hourly rates. The firm's hourly rates are: Personnel Hourly Rate --------- ---------- Dimitri Dalacas $295 Paralegals $125 About Windmill Durango Las Vegas, Nevada-based Windmill Durango Office, LLC, currently owns 4.49 acres of commercial real estate developed with a Class A office with improvements in Clark County, Nevada. IDC Windmill Durango, LLC, is the general partner of Windmill Durango, LP, which is the sole member of the Debtor. The Debtor is managed by Jeff Susa, Manager of IDC Windmill Durango, LLC. The Company filed for Chapter 11 protection on August 17, 2010 (Bankr. D. Nev. Case No. 10-25594). Zachariah Larson, Esq., and Shara Larson, Esq., at Larson & Stephens, in Las Vegas, represent the Debtor as counsel. The Debtor proposed the law firm of Flangas McMillan Law Group as special counsel. The Debtor disclosed $21,389,774 in assets and $16,535,000 in liabilities as of the Petition Date. Affiliates Windmill Durango Op, LLC (Bankr. D. Nev. Case No. 10-18058) and Windmill Durango Retail, LLC (Bankr. D. Nev. Case No. 10-18056) filed for Chapter 11 protection on May 3, 2010. WINGATE AIRPORT: U.S. Trustee Unable to Form Committee ------------------------------------------------------ The U.S. Trustee said that a committee under 11 U.S.C. Sec. 1102 has not been appointed because an insufficient number of persons holding unsecured claims against Wingate Airport South, LLC, have expressed interest in serving on a committee. The U.S. Trustee reserves the right to appoint such a committee should interest develop among the creditors. Las Vegas, Nevada-based Wingate Airport South, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11- 11950) on Feb. 11, 2011. In its schedules, the Debtor disclosed $12,000,000 in assets and $9,497,529 in liabilities as of the Petition Date. WINGATE AIRPORT: Gets Approval to Employ Neil J. Beller as Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Nevada has approved the employment of Neil J. Beller, Esq., of the law offices of Neil J. Beller, Ltd., as bankruptcy counsel to Wingate Airport South, LLC. Neil J. Beller, Ltd., declares that it does not represent any related parties to the Debtor, and that it does not represent parties who are now or may become adverse to the interest of the Debtor with respect to matters in which it is to be employed. Neil J. Beller, Ltd., has agreed to represent Debtor in its bankruptcy proceedings for a $10,000 retainer, which has been paid by the Debtor, and $425 per hour attorney time and $125 per hour paralegal time. Las Vegas, Nevada-based Wingate Airport South, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11- 11950) on Feb. 11, 2011. In its schedules, the Debtor disclosed $12,000,000 in assets and $9,497,529 in liabilities as of the Petition Date. WL HOMES: Wachovia Has Enforceable Security Interest in Asset ------------------------------------------------------------- Bankruptcy Judge Brendan Linehan Shannon granted the motion for summary judgment filed by Wachovia Bank in the lawsuit, Wachovia Bank, National Association, a national banking association, v. WL Homes, LLC (Debtor), a Delaware Limited Liability Company; JLH Insurance Corporation, an Arizona Corporation; and Does 1 through 100, inclusive, Adv. Proc. No. 09-50514 (Bankr. D. Del.). The adversary proceeding is about the ability of a parent company to grant a security interest in an asset of its subsidiary and the extent to which a third party may enforce such a security interest. The resolution of this issue turns on the legal significance that should be accorded to the actions of an agent of both the parent and the subsidiary, wearing multiple hats and presumptively acting on behalf of both entities. The Court held that the fact that an agent may represent more than one principal does not alter the well-established doctrine that an agent with authority is capable of binding its principal. Accordingly, the Court finds that a security interest in the subsidiary's asset granted by the parent's agent to a third party is enforceable if it otherwise satisfies the requirements set forth in Article 9 of the Uniform Commercial Code. Judge Shannon denied the motion for summary judgment filed by George L. Miller, Chapter 7 Trustee for the estate of WL Homes, LLC, to the extent that it seeks a declaration that Wachovia's security interest is invalid. A copy of Judge Shannon's May 25, 2011 Opinion is available at http://is.gd/TgSDdwfrom Leagle.com. About WL Homes Irvine, California-based WL Homes LLC -- dba John Laing Homes, John Laing Homes Luxury, Laing Urban, Laing Luxury Homes, and John Laing Urban -- is one of metro Denver's largest homebuilders. It builds under the John Laing brand primarily in Colorado, California, Arizona, and Texas. John Laing began as a builder in the United Kingdom and came to the U.S. market in 1984. The company was sold to Dubai-based Emaar Properties in 2006 for $1.05 billion. Emaar invested $613 million in the company, but eventually stopped funding. John Laing had a work force of 1,100 in 2006, but cut employees to about 90 by the first week of February 2009. John Laing has 105 real estate developments across the country. It also builds luxury and custom homes. WL Homes and five of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 09-10571) on Feb. 19, 2009. Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtors' in their restructuring efforts. Ashby & Geddes represents the Official Committee of Unsecured Creditors. In its bankruptcy petition, WL Homes estimated assets of more than $1 billion, and debts between $500 million and $1 billion. As reported in the TCR on June 10, 2009, the Bankruptcy Court converted WL Homes LLC and its debtor affiliates' Chapter 11 cases to cases under Chapter 7 liquidation, at the request of the creditors committee. * Bank of America, Morgan Stanley Settle Foreclosure Suit --------------------------------------------------------- American Bankruptcy Institute reports that the Justice Department yesterday settled with subsidiaries of Bank of America Corp. and Morgan Stanley for more than $22 million to resolve allegations that the banks wrongfully foreclosed on almost 200 active-duty military-service members without first obtaining court orders. * SecondMarket Says Claims Trading Facing 'Slowdown' ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the dearth of major new Chapter 11 filings is leading to an inevitable decline in the value of claims being traded. Mr. Rochelle relates that according to data compiled from court records by SecondMarket Inc., in April, the $1.84 billion in Lehman Brothers Holdings Inc. claims that were traded represented 84 percent in dollar amount of all transfers reported to the country's bankruptcy courts. In March, Lehman was responsible for 82 percent of all traded debt by dollar amount. According to the report, April's overall numbers "pointed to a slowdown in claims trading," said New York-based SecondMarket, which describes itself the largest secondary market for illiquid assets. So far this year, 30 public companies sought Chapter 11 relief, compared with 39 in the same period last year, according to statistics compiled by Bankruptcydata.com, a service of New Generation Research Inc. In term of the sizes of new cases, the decline is more dramatic. The assets of public companies entering Chapter 11 this year totaled $6.7 billion, or 29 percent of the year-ago period's $22.9 billion, the Bankruptcydata report said. The 380 reported Lehman trades in April represented 43 percent of the month's 892 trades, SecondMarket said. In number of trades, April's figure was the second-highest in a year. * Large Companies With Insolvent Balance Sheet ---------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- ANOORAQ RESOURCE ARQ SJ 1,024.0 (77.0) 20.9 AUTOZONE INC AZO US 5,884.9 (1,119.5) (655.3) LORILLARD INC LO US 3,590.0 (449.0) 1,290.0 DUN & BRADSTREET DNB US 1,825.5 (615.8) (321.8) WEIGHT WATCHERS WTW US 1,126.0 (636.6) (345.4) CLOROX CO CLX US 4,051.0 (82.0) (28.0) MEAD JOHNSON MJN US 2,465.4 (250.4) 572.3 NAVISTAR INTL NAV US 9,279.0 (832.0) 2,002.0 TAUBMAN CENTERS TCO US 2,535.6 (512.8) - DIRECTV-A DTV US 20,593.0 (678.0) 2,813.0 MOODY'S CORP MCO US 2,524.4 (223.2) 498.6 SUN COMMUNITIES SUI US 1,160.1 (111.7) - CHOICE HOTELS CHH US 412.4 (49.0) (1.9) CABLEVISION SY-A CVC US 8,962.9 (6,462.4) (309.5) HCA HOLDINGS INC HCA US 23,809.0 (7,788.0) 2,719.0 VERISK ANALYTI-A VRSK US 1,286.4 (109.1) (180.8) DISH NETWORK-A DISH US 10,280.6 (502.5) 705.1 UNISYS CORP UIS US 2,949.3 (692.1) 547.6 UNITED RENTALS URI US 3,692.0 (29.0) 123.0 THERAVANCE THRX US 315.1 (27.8) 266.9 DOMINO'S PIZZA DPZ US 487.4 (1,167.7) 167.9 IPCS INC IPCS US 559.2 (33.0) 72.1 GRAHAM PACKAGING GRM US 2,943.5 (501.5) 313.1 TEAM HEALTH HOLD TMH US 832.2 (25.7) 44.8 DISH NETWORK-A EOT GR 10,280.6 (502.5) 705.1 VECTOR GROUP LTD VGR US 924.6 (61.4) 294.8 OTELCO INC-IDS OTT US 319.2 (7.6) 22.4 FREESCALE SEMICO FSL US 4,097.0 (5,076.0) 1,468.0 NATIONAL CINEMED NCMI US 796.4 (327.0) 74.0 OTELCO INC-IDS OTT-U CN 319.2 (7.6) 22.4 INCYTE CORP INCY US 459.6 (104.0) 315.8 CHENIERE ENERGY CQP US 1,776.3 (547.6) 24.4 WESTMORELAND COA WLB US 788.0 (173.9) (1.0) REVLON INC-A REV US 1,105.5 (686.5) 132.7 MAINSTREET EQUIT MEQ CN 453.0 (10.2) - RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 SALLY BEAUTY HOL SBH US 1,707.0 (340.6) 418.5 MERITOR INC MTOR US 2,675.0 (1,006.0) 205.0 PROTECTION ONE PONE US 562.9 (61.8) (7.6) KNOLOGY INC KNOL US 823.7 (4.0) 42.7 JUST ENERGY GROU JE CN 1,760.9 (328.6) (339.4) VENOCO INC VQ US 815.6 (21.6) 8.1 BOSTON PIZZA R-U BPF-U CN 148.2 (100.1) 1.3 REGAL ENTERTAI-A RGC US 2,323.2 (541.6) (114.5) SWIFT TRANSPORTA SWFT US 2,555.7 (9.8) 204.6 RSC HOLDINGS INC RRR US 2,817.4 (62.2) (71.6) QUALITY DISTRIBU QLTY US 281.4 (124.4) 40.9 WORLD COLOR PRES WC CN 2,641.5 (1,735.9) 479.2 CHENIERE ENERGY LNG US 2,564.4 (509.7) 87.4 SPIRIT AIRLINES SAVE US 545.2 (97.0) 27.6 EXELIXIS INC EXEL US 495.7 (68.7) 126.1 AMER AXLE & MFG AXL US 2,167.8 (415.4) 60.4 WORLD COLOR PRES WCPSF US 2,641.5 (1,735.9) 479.2 WORLD COLOR PRES WC/U CN 2,641.5 (1,735.9) 479.2 RENAISSANCE LEA RLRN US 49.9 (31.4) (36.6) NPS PHARM INC NPSP US 158.3 (159.7) 117.8 SINCLAIR BROAD-A SBGI US 1,571.2 (144.6) 60.4 ISTA PHARMACEUTI ISTA US 131.7 (161.7) 6.6 US AIRWAYS GROUP LCC US 8,217.0 (30.0) (104.0) ALASKA COMM SYS ALSK US 609.8 (27.4) 6.3 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) WARNER MUSIC GRO WMG US 3,617.0 (254.0) (650.0) ACCO BRANDS CORP ABD US 1,094.2 (77.0) 293.1 MORGANS HOTEL GR MHGC US 692.8 (29.2) 205.1 NYMOX PHARMACEUT NYMX US 10.0 (3.3) 6.8 BLUEKNIGHT ENERG BKEP US 323.5 (35.1) (85.8) SMART TECHNOL-A SMT US 546.2 (43.3) 173.7 NEXSTAR BROADC-A NXST US 582.6 (181.2) 40.0 PRIMEDIA INC PRM US 208.0 (91.7) 3.6 SMART TECHNOL-A SMA CN 546.2 (43.3) 173.7 TOWN SPORTS INTE CLUB US 460.0 (4.7) (15.4) QWEST COMMUNICAT Q US 16,849.0 (1,560.0) (2,828.0) SINCLAIR BROAD-A SBTA GR 1,571.2 (144.6) 60.4 LIZ CLAIBORNE LIZ US 1,255.8 (124.5) (26.5) PDL BIOPHARMA IN PDLI US 248.7 (371.2) (161.6) CENVEO INC CVO US 1,439.5 (333.5) 208.1 AMR CORP AMR US 27,113.0 (3,949.0) (1,028.0) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) CC MEDIA-A CCMO US 16,938.6 (7,280.4) 1,644.2 GENCORP INC GY US 989.6 (177.7) 83.8 PALM INC PALM US 1,007.2 (6.2) 141.7 CLEVELAND BIOLAB CBLI US 19.2 (9.7) (10.1) VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) RADNET INC RDNT US 556.6 (81.8) 11.0 LIN TV CORP-CL A TVL US 797.4 (127.9) 38.6 VONAGE HOLDINGS VG US 251.7 (102.0) (39.2) IDENIX PHARM IDIX US 54.9 (40.6) 19.6 ABSOLUTE SOFTWRE ABT CN 116.3 (12.0) (12.6) GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 MANNKIND CORP MNKD US 254.8 (203.5) 26.2 EPICEPT CORP EPCT SS 12.4 (6.0) 6.0 ODYSSEY MARINE OMEX US 25.7 (8.1) (14.0) DENNY'S CORP DENN US 296.8 (102.3) (36.9) CUMULUS MEDIA-A CMLS US 318.9 (324.4) 12.4 VERSO PAPER CORP VRS US 1,458.2 (49.2) 169.5 COLUMBIA LABORAT CBRX US 27.8 (2.6) 11.5 HUGHES TELEMATIC HUTC US 108.8 (62.4) (16.0) KV PHARM-B KV/B US 296.2 (233.4) (134.5) EASTMAN KODAK EK US 5,882.0 (1,274.0) 954.0 KV PHARM-A KV/A US 296.2 (233.4) (134.5) CINCINNATI BELL CBB US 2,636.2 (650.4) 6.4 QUANTUM CORP QTM US 431.0 (61.1) 97.9 HOVNANIAN ENT-B HOVVB US 1,670.1 (401.3) 1,042.4 ********* 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 ***