/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/110809.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, August 9, 2011, Vol. 15, No. 219 Headlines 12 BYFIELD: Wins Plan Approval, Thwarts Bank's Conversion Motion 15-35 HEMPSTEAD: Bank Wins Auction With $13.5-Mil. Offer 155 EAST TROPICANA: Execs Got More as Revenue Dropped, Says Lender 155 EAST TROPICANA: Hooters Casino Has Interim Cash-Use Authority 4KIDS ENTERTAINMENT: Nantahala Capital Owns 6.131% of Common Stock 4KIDS ENTERTAINMENT: Court OKs Eisneramper LLP as Auditor 5TH AVENUE: Wants to Hire Richard M. Kipperman as Replacement CRO AMERICA WEST: CFO Rodriguez Resigns; Robison CEO Takes Over ANGELO & MAXIE: Wins Confirmation of Liquidating Plan ARAPAHOE LAND: Asks for Dismissal of Chapter 11 Case ATI ACQUISITION: Gets 'Caa2' from Moody's as School Papers Revoked AUTOTRADER.COM INC: S&P Retains 'BB+' Corporate Credit Rating AVIS BUDGET: S&P Rates $600-Million Term Loans at 'BB' AWAL BANK: HSBC Loses Bid to Dismiss Chapter 11 Case & Lawsuit BELTWAY ONE: Files Schedules of Assets and Liabilities BLACK WOLF: Case Summary & 11 Largest Unsecured Creditors BLUEGREEN CORP: Stops Offering Under Retirement Plan BNC MORTGAGE: Famatiga Suit v. Mortgage Firms Dismissed BORDERS GROUP: Executives Leave; Alix's Etlin Takes Over BORDERS GROUP: Parties Oppose Terms of IP Assets, Leases Sale BORDERS GROUP: Camelot LLC Wants to File Late Claim BRIDGE VIEW: Voluntary Chapter 11 Case Summary CDC PROPERTIES II: Hires Graham & Dunn as Replacement Counsel CENTRAL FALLS, R.I.: Judge Wants City Back on Track ASAP CLAIM JUMPER: Sets Plan Confirmation as Black Canyon Settles CLEAR CREEK: Files New Schedules of Assets & Liabilities CNO FINANCIAL: S&P Raises Counterparty Credit Rating to 'B+' COMMERCIAL VEHICLE: Files Form 10-Q; Incurs $2.2-Mil. Loss in Q2 COMMERCIAL VEHICLE: To Issue 1.4 Million Common Shares Under Plan CONGRESS SAND: Beveridge & Diamond Okayed as Environmental Counsel CRACKER BARREL: S&P Withdraws 'BB-' Corporate Credit Rating CRYSTAL CATHEDRAL: Taps Prudential Calif. as Condominium Broker CST INDUSTRIES: S&P Lowers Corporate Credit Rating to 'B' CYBEX INTERNATIONAL: Files Form 10-Q; Incurs $555,000 Loss in Q2 DAVID'S WESTMINSTER: Ch. 7 Trustee Says Business Could Reopen ELEPHANT & CASTLE: Can Hire Eckert Seamans as Bankruptcy Counsel ELEPHANT & CASTLE: Epiq Bankruptcy OK'd as Claims, Noticing Agent ELEPHANT & CASTLE: Taps BellMark Partners as Financial Advisor ELEPHANT & CASTLE: Rose Group OK'd for Labor, Employment Matters ENDEAVOUR INTERNATIONAL: S&P Withdraws CCC+ Corp. Credit Rating EOS PREFERRED: Buys $46-Mil. Residential Assets from Aurora Bank EVANS OIL: Plan Filing Exclusivity Expires Aug. 12 EVERGREEN PLAZA: Taps M. Jonathan Hayes as Gen. Bankruptcy Counsel FAITH CHRISTIAN: Taps Lyons & Farrar as Counsel for BP Claim FAITH CHRISTIAN: Taps Judkins Simpson to Handle Marriage Action FAITH CHRISTIAN: Meeting of Creditors Resumes Tomorrow FAITH CHRISTIAN: Plan Disclosures Hearing Tomorrow FENTON SUB: Court OK's Fredrikson & Byron as Bankruptcy Counsel FISHER COMMS: Moody's Upgrades Corporate Family Rating to 'B1' GENERAL MOTORS: Old GM Still Holding $2.36 Billion in New GM Stock GENTIVA HEALTH: Moody's Reviews Ba3 Corporate for Downgrade GIORDANO'S ENTERPRISES: Ousted Owner Mulls Bid, Raising $70MM HANLEY WOOD: Likely to Restructure Due to Cash Woes, Says Moody's HOMELAND SECURITY: Acquires All Outstanding Timios Capital Stock HOTEL AIRPORT: Case Summary & 20 Largest Unsecured Creditors HOWREY LLP: Bills to Bankr. Advisors Start to Pile Up HOWREY LLP: To Hire Duane Morris as Special Counsel HUDSON HEALTHCARE: Meeting to Form Creditors Committee Friday J. RAY MCDERMOTT: Moody's Affirms 'Ba1' Corporate; Outlook Stable JACKSON HEWITT: Wins Confirmation of Exit Plan JEFFERSON COUNTY: May Be Near Deal with Bondholders KAZI FOODS: Can't Assume KFC Franchise Deals Absent Consent KOBRA EFS: Unit Files Schedules of Assets & Liabilities KRONOS INTERNATIONAL: Reports $67.8 Million Net Income in Q2 LAW ENFORCEMENT: Frost PLLC Resigns as Independent Accountant LIBBEY INC: S&P Raises Corporate Credit Rating to 'B+' LIFECARE HOLDINGS: Completes Acquisition of HealthSouth Hospitals LINDA M JONES: Bankruptcy Case Re-converted to Chapter 11 LINDEN PONDS: To Seek Plan Confirmation on Aug. 18 LITTLETON APARTMENTS: Files Schedules of Assets and Liabilities LITTLETON APARTMENTS: Has Interim Access to Secured Lenders' Cash LOS ANGELES DODGERS: Seeks Court OK for $150 Million Loan from MLB LTV STEEL: Defunct Vendor Retains Attorney-Client Privilege LYMAN LUMBER: Files for Chapter 11 to Sell to Investment Firm LYMAN LUMBER: Case Summary & 20 Largest Unsecured Creditors MACCO PROPERTIES: Shareholder Wants Reorganization Case Dismissed MACCO PROPERTIES: Price Edwards OK'd as Trustee's Property Manager MACROSOLVE INC: Steve Signoff Appointed Chief Executive Officer MATIKA VILLA: Case Summary & 20 Largest Unsecured Creditors MEDCLEAN TECHNOLOGIES: Inks Director Agreement with C. Nelson MORGANS FOODS: Black Horse, et al., Do Not Own Common Shares MORGANS HOTEL: Inks $100MM Revolving Facility with Deutsche Bank NETWORK SOLUTIONS: Moody's Affirms B2 CFR; Outlook Stable NPS PHARMACEUTICALS: To Issue $150 Million of Securities OMNICARE INC: Moody's Affirms Ba3 CFR; Outlook Negative OMNICARE INC: S&P Affirms 'BB' Corporate Credit Rating ORESTES & MELODY: Meeting to Form Committee on Thursday PACIFIC LUMBER: Buyers Wins Appeals Court Reversal $29.7MM Order PACIFICUS REAL: Files Schedules of Assets and Liabilities PERRY COUNTY: Fitch Withdraws 'BB' Rating on Revenue Bonds PETROHUNTER ENERGY: Incurs $1.4-Mil. Net Loss in June 30 Quarter PICHIS INC: Case Summary & 20 Largest Unsecured Creditors PLATINUM PROPERTIES: Wants Until Dec. 21 to File Chapter 11 Plan PMI MORTGAGE: S&P Lowers Counterparty Credit Rating to 'CCC-' POST STREET: Amends Schedules of Assets and Liabilities PRECISION OPTICS: Sells IP to Intuitive for $2.5 Million QUINCY MEDICAL: Files Schedules of Assets and Liabilities QUINCY MEDICAL: Needs to Have Winning Bidder by Aug. 17 RANCHO CUCAMONGA: Involuntary Chapter 11 Case Summary REICHMANN PETROLEUM: ConocoPhillips Sued Over Unpaid Revenues REVIVAL OUTREACH: Court Wants Changes to Plan Outline RHODE ISLAND: Moody's Reviews Ba1 Rating for Possible Downgrade RIVER EAST: Judge Eugene R. Wedoff Resumes Case Assignment ROTHSTEIN ROSENFELDT: Investors Suit v. TD Bank Sent to Fla. Court SEAHAWK DRILLING: Anthion Master Fund Owns 5.07% of Common Shares SIGNATURE STYLES: Has Approval for Reinstatement on Google SL GREEN: Fitch Rates $250-Mil. Sr. Unsecured Notes at 'BB+' SPANSION INC: Valuation Appeal Dismissed as Moot STANLEY NEWQUIST III: Transfers Property to Creditor STEVE MCKENZIE: Grant Konvalinka Denied Leave to Sue Trustee STILLWATER MINING: Reports $42.7 Million Net Income in Q2 SUMMIT VIEW: Law Firm's Claim Limited to $200T Settlement SYSTEMS HOLDING: Case Summary & 11 Largest Unsecured Creditors TAWK DEVELOPMENT: Moves Plan Exclusivity Hearing to Aug. 31 TEGRANT CORP: S&P Raises Corporate Credit Rating to 'CCC+' TEN X: Files Schedules of Assets and Liabilities TERRANOVA-2007: Voluntary Chapter 11 Case Summary TERRESTAR CORP: Files Disclosure Statement for Plan TERRESTAR CORP: Plan Exclusivity Expires Oct. 14 TEX X CAPITAL: Can Access Cole Taylor Bank's Cash Until Aug. 31 TREY RESOURCES: Stanley Wunderlich Appointed to Board TRIBUNE CO: Asks OK of Settlement of 2007 Minimum Wage Class Suit TRICO MARINE: Anticipates Plan to Be Effective Tomorrow UNUM GROUP: Moody's Affirms '(P)Ba1' Subordinate Shelf Rating VALENCE TECHNOLOGY: Incurs $3.09 Million Net Loss in June 30 Qtr. VALLEY BAPTIST: Fitch Puts 'BB' Rating on Watch Evolving VILLAGE AT CAMP BOWIE: Denies Confirmation of Second Amended Plan VITAMINSPICE: Involuntary Chapter 11 Case Summary VITRO SAB: Seeks $6.2 Million From Bondholders for Fees VITRO SAB: U.S. Units Have Until Oct. 4 to Propose Ch. 11 Plan WASHINGTON MUTUAL: DOJ Ends Probe With No Criminal Charges WASHINGTON MUTUAL: Court Names Carolyn Cairns as Mediator WASHINGTON MUTUAL: Committee Taps Partnoy as Litigation Consultant WHITTLE DEVELOPMENT: Amended Reorganization Plan Confirmed W.R. GRACE: Files Post-Confirmation Report for Second Quarter W.R. GRACE: Paul Weiss Represents Holders of $369MM Debt W.R. GRACE: Opens Manufacturing Facility in Gurgaon, India YELLOW MEDIA: S&P Lowers Corporate Credit Rating to 'BB+' YRC WORLDWIDE: Announces Composition of Board Committees * Business Bankruptcies Down 13% From Last Year * Ex Birmingham, Ala. Mayor's Bribery Conviction Appeal Denied * S&P Speculative-Grade Composite Spread Widens to 609 Bps * S&P's U.S. Downgrade Doesn't Affect Top-Rated Corporate Issuers * S&P Ratings on U.S. Banks Unaffected by Sovereign Downgrade * S&P Cuts Housing Issues Backed by Fannie, Freddie to 'AA+' * S&P Lowers Ratings on 5 Insurance Groups After U.S. Downgrade * Weiss Ratings Credits S&P for Important First Step * Large Companies With Insolvent Balance Sheets ********* 12 BYFIELD: Wins Plan Approval, Thwarts Bank's Conversion Motion ---------------------------------------------------------------- The Hon. Robert D. Drain of the U.S. Bankruptcy Court for the Southern District of New York denied, without prejudice, New USA Bank's request to convert 12 Byfield, LLC's Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. At the hearing held on July 13, 2011, the Court declared the motion as moot due to confirmation of the Debtor's Plan of Reorganization. As reported in the Troubled Company Reporter on July 19, the Plan will be implemented by and through the proceeds of an exit financing, a loan from TDC Secured Strategies Fund, LLC, secured by a first priority priming lien on the Debtor's single family residence project in the approximate amount of $3 million for a term of 18 months, with two extension options of three months each. The proceeds of the exit financing will be sufficient to permit the Reorganized Debtor to fund the initial distribution to creditors, payment of allowed administrative claims (including professional fees), payment of allowed priority tax claims, completion of the Project, interest payments to USA Ban, and carry costs for a reasonable time period to market and sell the Project so as to maximize value. To the extent that there is a shortfall, the holders of the equity interests have agreed to infuse up to an additional $250,000. Secured creditor USA Bank will be paid in full from the proceeds of the sale of the Project. Holders of mortgage options, a separate group of secured creditors, will also be paid in full. Holders of allowed priority claims will be paid in cash, in full. Holders of general unsecured claims will be paid 50% of their allowed claims on the later of the effective date or the date any such claim becomes an allowed claim and 50% of their allowed claims from the proceeds of the sale of the Project after payment of the higher ranked creditors. Under the Plan, holders of existing equity interests (Class 6), namely, James Scheckter and Susan Scheckter, will be issued new interests in the Reorganized Debtor. In exchange for the new interests, James Scheckter and Susan Scheckter will contribute as capital to the Reorganized Debtor an amount up to $250,000 in the aggregate if, when and as needed by the Reorganized Debtor, as well as guarantee the exit financing and continue their guarantees of the allowed secured claim of USA Bank. A copy of the Amended Disclosure Statement is available at: http://bankrupt.com/misc/12byfield.amendedDS.pdf About 12 Byfield, LLC Redding, Connecticut-based 12 Byfield, LLC, filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-22740) on April 16, 2010. Richard J. Bernard, Esq., at Baker & Hostetler LLP, assists the Company in its restructuring effort. The Company estimated $10 million to $50 million in assets and $1 million to $10 million in debts as of the Chapter 11 filing. 15-35 HEMPSTEAD: Bank Wins Auction With $13.5-Mil. Offer -------------------------------------------------------- Elaine Rose at pressofAtlanticCity reports that bankruptcy trustee Karen L. Gillman, of West Orange, said New York Community Bank, which holds $17.2 million in mortgages on the View at 101 Boardwalk in Atlantic City, was the successful bidder for the property, offering to buy the 539-unit apartment complex, formerly known as the Waterside, for $13.5 million. According to the report, Steven and Angelina Kates of New York City, owners of 15-35 Hempstead Properties, bought the building in February 2007 for $23.3 million. They learned just before closing that the city had issued 1,000 code violations and the state Department of Community Affairs planned to issue hundreds more. The report says the bankruptcy auction was held Wednesday at the Trump Taj Mahal Casino Resort. The sale is contingent on approval of the U.S. Bankruptcy Court at a hearing scheduled for Aug. 11 in Camden. pressofAtlanticCity notes New York Community Bank decided to bid on the property because it was appraised at more than the $13.5 million it paid at Wednesday's auction, said Ilene A. Angarola, executive vice president of investor relations and corporate communications. About 15-35 Hempstead Properties 15-35 Hempstead Properties, LLC and Jackson 299 Hempstead, LLC, own real property at 101 Boardwalk in Atlantic City, New Jersey. They filed for Chapter 11 bankruptcy protection (Bankr. D. N.J. Case Nos. 10-43178 and 10-43180) on Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, serve as counsel to the Debtors. The Debtors each estimated assets and debts at $10 million to $50 million. 155 EAST TROPICANA: Execs Got More as Revenue Dropped, Says Lender ------------------------------------------------------------------ Steve Green at Vegas Inc. reports that Hooters filed for Chapter 11 bankruptcy protection to block a foreclosure by debt holder Canpartners Realty Holding Company IV, an affiliate of Canyon Capital Realty Advisors of Los Angeles, which a $20 billion investment house. According to the report, attorneys for Canpartners weren't favorable about Hooters management. Mr. Green notes Canpartners noted in a court filing that Deborah Pierce, the chief financial officer of Hooters casino's parent company, 155 East Tropicana LLC, in early July had an annual base salary of $191,406 - not counting potential bonuses. "Sometime last month, on the eve of bankruptcy, Ms. Pierce's base salary was increased by 61 percent (to $307,406)," the report quotes Canpartners as saying. Mr. Green relates that Canpartners noted that Gary Gregg, chief operating officer of the casino company, receives a base salary of $300,000; Michael Hessling, president, receives a base salary of $275,000; and Neil Kiefer, CEO, receives a $100,000 annual salary. "Based on the company's financial statements previously provided to Canpartners by Ms. Pierce, net revenue declined by 34 percent from $66.5 million to $43.7 million from 2007 to 2010, respectively," Vegas Inc. quotes Canpartners' filing. "During that same time period of revenue decline, executive salaries increased 8 percent whereas salaries for all departments excluding executives declined by 26 percent and full-time employees were reduced by 37 percent from 966 FTEs to 605 FTEs." About 155 East Tropicana 155 East Tropicana owns the world's first Hooters Casino Hotel, a 696-room and 4-suite hotel located one block from the Las Vegas Strip and across Tropicana Blvd. from MGM Grand. 155 East Tropicana, LLC, along with an affiliate, sought Chapter 11 protection (Bankr. D. Nev. Case No. 11-22216) on Aug. 1, 2011. 155 East sought bankruptcy to stop a scheduled Aug. 8 foreclosure of the second-lien debt. The two secured credit facilities were accelerated early this year. Canpartners Realty Holding Co. IV LLC acquired 98.4 percent of the $130 million in 8.75 percent second-lien senior secured notes. An additional $32.2 million of interest is owing on the second-lien debt. US Bank NA is indenture trustee. Holders of the $14.5 million in first-lien debt have Wells Fargo Capital Finance Inc. as their agent. The first-lien obligation is fully secured. Interest has been paid currently at the default rate. Brigid M. Higgins, Esq., at Gordon & Silver, Ltd., in Las Vegas, Nevada, serves as counsel to the Debtors. Garden City Group, Inc., is the claims agent. 155 East Tropicana estimated $50 million in assets and $100 million to $500 million in liabilities. 155 EAST TROPICANA: Hooters Casino Has Interim Cash-Use Authority ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Hooters Casino Hotel was given interim authority Aug. 4 to use cash representing collateral for secured lenders' claims. Outlining the casino's options, U.S. Bankruptcy Judge Bruce A. Markell said in court, "Either you give up the keys pretty quickly, or you get a consensual plan or you come up with some new value." About 155 East Tropicana 155 East Tropicana owns the world's first Hooters Casino Hotel, a 696-room and 4-suite hotel located one block from the Las Vegas Strip and across Tropicana Blvd. from MGM Grand. 155 East Tropicana, LLC, along with an affiliate, sought Chapter 11 protection (Bankr. D. Nev. Case No. 11-22216) on Aug. 1, 2011. 155 East sought bankruptcy protection to stop a scheduled Aug. 8 foreclosure of the second-lien debt. The two secured credit facilities were accelerated early this year. Canpartners Realty Holding Co. IV LLC acquired 98.4% of the $130 million in 8.75% second-lien senior secured notes. An additional $32.2 million of interest is owing on the second-lien debt. US Bank NA is the indenture trustee. Holders of the $14.5 million in first-lien debt have Wells Fargo Capital Finance Inc. as their agent. The first-lien obligation is fully secured. Interest has been paid currently at the default rate. Brigid M. Higgins, Esq., at Gordon & Silver, Ltd., in Las Vegas, Nevada, serves as counsel to the Debtors. Garden City Group, Inc., is the claims agent. 155 East Tropicana estimated $50 million in assets and $100 million to $500 million in liabilities. 4KIDS ENTERTAINMENT: Nantahala Capital Owns 6.131% of Common Stock ------------------------------------------------------------------ Nantahala Capital Management, LLC, a Massachusetts limited liability company, discloses that as of July 25, 2011, it beneficially owns 829,400 shares of common stock of 4Kids Entertainment, Inc., representing 6.131% of the issuers' outstanding common shares. The percentage ownership is based on 13,528,958 shares of the issuers' common stock outstanding as stated in the issuer's Form 10-Q filed on May 16, 2011. A copy of the Schedule 13D is available at http://is.gd/BOm4AJ About 4Kids Entertainment New York-based 4Kids Entertainment, Inc., dba 4Kids, is an entertainment and media company specializing in the youth oriented market, with operations in these business segments: (i) licensing, (ii) advertising and media broadcast, and (iii) television and film production/distribution. The parent entity, 4Kids Entertainment, was organized as a New York corporation in 1970. The principal driver for filing the Chapter 11 cases is the need to protect 4Kids' most valuable asset -- its rights under an exclusive license relating to the popular Yu-Gi- Oh! ("YGO") series of animated television programs -- from efforts by the licensor, a consortium of Japanese companies, to allegedly wrongfully terminate the license and force 4Kids out of business. 4Kids Entertainment, along with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-11607) on April 6, 2011. Kaye Scholer LLP is the Debtors' restructuring counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims and notice agent. BDO Capital Advisors, LLC, is the financial advisor and investment banker. An official committee of unsecured creditors has not been appointed by the Office of the United States Trustee. 4KIDS ENTERTAINMENT: Court OKs Eisneramper LLP as Auditor --------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has approved 4Kids Entertainment Inc.'s application to employ EisnerAmper LLP fka Eisner LLP as auditor and tax advisor. As reported in the Troubled Company Reporter on July 21, 2011, the professional services that the firm will render to the Debtors may include, without limitation: a) review of the Debtors' interim financial information for the quarters ending June 2011, September 2011 and December 2011; and b) preparation of the Debtors' federal and state tax returns. According to the Debtors, the firm is retained on a fixed fee basis. In respect of the Debtors' quarterly auditing reviews, the firm is to be paid $20,000 after the end of each quarter. In respect of tax preparation services, the firm is to be paid $75,000 after the filing of the Debtors' tax returns, which is estimated to occur in September or October of 2011. The firm's hourly rates are: Partners $450 to $550 Managers/Senior Managers/Directors $325 to $425 Seniors/Staff $200 to $300 The Debtors assure the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About 4Kids Entertainment New York-based 4Kids Entertainment, Inc., dba 4Kids, is an entertainment and media company specializing in the youth oriented market, with operations in these business segments: (i) licensing, (ii) advertising and media broadcast, and (iii) television and film production/distribution. The parent entity, 4Kids Entertainment, was organized as a New York corporation in 1970. The principal driver for filing the Chapter 11 cases is the need to protect 4Kids' most valuable asset -- its rights under an exclusive license relating to the popular Yu-Gi- Oh! ("YGO") series of animated television programs -- from efforts by the licensor, a consortium of Japanese companies, to allegedly wrongfully terminate the license and force 4Kids out of business. 4Kids Entertainment, along with affiliates, filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-11607) on April 6, 2011. Kaye Scholer LLP is the Debtors' restructuring counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims and notice agent. BDO Capital Advisors, LLC, is the financial advisor and investment banker. An official committee of unsecured creditors has not been appointed by the Office of the United States Trustee. 5TH AVENUE: Wants to Hire Richard M. Kipperman as Replacement CRO ----------------------------------------------------------------- 5th Avenue Partners, LLC, asks the U.S. Bankruptcy Court for the Central District of California to approve a stipulation replacing its chief restructuring officer. The stipulation was entered among the Debtor, WestLB AG, New York Branch, the Official Committee of Unsecured Creditors, Prism Hotels & Resorts or its direct or indirect affiliate, and Corporation Management, Inc. The stipulation provides for, among other things: -- the CRO may resign as the Debtor's CRO at any time; and -- in the event that the CRO is terminated, the Court will approve a replacement CRO prior to the departure of the current CRO upon the agreed stipulation of the parties. PHC Dallas, LLC, an affiliate of Prism, through its designee John D. Bailey has acted as the Debtor's CRO. On June 15, 2011, Prism resigned. As a result of the resignation, the Debtor's estate requires a new responsible officer to wrap up and complete the administration of the Debtor's case. The Debtor has selected CMI and its designee Richard M. Kipperman, to replace PHC as the Debtor's CRO. About 5th Avenue Partners Newport Beach, California-based 5th Avenue Partners owns and operates the Se San Diego hotel located in San Diego, California's financial district. The hotel has 184 guestrooms, a 5,500-square- foot spa, a restaurant, rooftop bar and lounge, 20,000 square feet of banquet space and meeting rooms, an outdoor rooftop pool, fitness center and 23 unsold condominium units. 5th Avenue also owns next to the Se San Diego hotel building a 31,000-square-foot building, which it leases to the House of Blues music club. 5th Avenue Partners, LLC, filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 10-18667) on June 25, 2010. Marc J. Winthrop, Esq., at Winthrop Couchot PC, in Newport Beach, California, assists the Company in its restructuring effort. Blitz Lee & Company serves as its accountant. The Company estimated assets at $10 million to $50 million and debts at $50 million to $100 million. The Official Committee of Unsecured Creditors tapped Baker & McKenzie LLP as counsel. AMERICA WEST: CFO Rodriguez Resigns; Robison CEO Takes Over ----------------------------------------------------------- America West Resources, Inc.'s Chief Financial Officer, Brian Rodriguez, resigned effective Aug. 1, 2011. Effective that same date, Brent Davies, age 62, was appointed as the Company's CFO, with a monthly salary of $15,000. For over the last ten years Brent has been the CEO of Robison, Hill & Co., APC, Certified Public Accountants. Brent graduated from the University of Utah in 1973 with a B.S. in Marketing and a B.S. in Management. After serving as a manager in the S. S. Kresge Co. (K-Mart), he returned to school and received a B.S. in Accounting and a MBA (accounting option) in 1976 from the University of Wyoming. He is a Certified Management Accountant and has CPA certificates from California, Nevada, Utah and Wyoming. He has had 40 years of diversified public accounting, industry and teaching experience, including national accounting firm auditing experience; serving as a controller of a small privately owned company; serving on the Board of Directors of several small public and private companies; and participating in accounting and marketing research projects that resulted in two of the articles which he wrote, being published in national magazines. Brent's initial involvement in the mining industry began in 1972 when he was employed by Commercial Shearing Inc. which was heavily involved in tunneling and mine roof support systems. During his career in public accounting he has been involved with various oil and gas, coal, gold, silver, phosphate, sand and gravel mining companies as a consultant, tax preparer, auditor and in financial statement preparation. He has also served on the board of directors for two mining companies. Brent is currently serving as the Utah representative to the State of Nevada CPA Peer Review Acceptance Body. About America West Based in Salt Lake City, Utah, America West Resources, Inc., is an established domestic coal producer engaged in the mining of clean and compliant (low-sulfur) coal. The majority of the Company's coal is sold to utility companies for use in the generation of electricity. The Company reported a net loss of $16.14 million on $10.07 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $8.70 million on $11.01 million of total revenue during the prior year. As reported by the TCR on April 21, 2011, MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt about America West's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has a working capital deficit and has incurred significant losses. The Company's balance sheet at March 31, 2011, showed $28.14 million in total assets, $27.03 million in total liabilities, and $1.11 million in total stockholders' equity. ANGELO & MAXIE: Wins Confirmation of Liquidating Plan ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Angelo & Maxie's has an approved liquidating Chapter 11 plan given the bankruptcy judge's signature on an Aug. 3 confirmation order. Unsecured creditors with about $530,000 in claims are to split up the $160,000 plus recoveries from lawsuits. Houston-based Landry's paid about $3 million for the 230-seat restaurant owned by Angelo & Maxie. From the total, $1.19 million covered secured debt that Landry's acquired. From the price $160,000 was set aside for unsecured creditors and $225,000 for expenses of the Chapter 11 case. An additional $339,000 was used to cure breaches of the lease. Angelo & Maxie's, LLC filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 11-11112) in Manhattan on March 14, 2011. Dawn K. Arnold, Esq., at Rattet Pasternak, LLP, in Harrison, New York, serves as counsel. The Debtor estimated up to $1 million in assets and debts of $1 million to $10 million as of the Chapter 11 filing. ARAPAHOE LAND: Asks for Dismissal of Chapter 11 Case ---------------------------------------------------- Arapahoe Land Investments, LP, asks the U.S. Bankruptcy Court for the Southern District of Texas to dismiss its Chapter 11 case. Arapahoe Land Investments LP owns a 67-acre property in League City, Texas, worth $13.5 million while its mortgage debt is $8.5 million. Trustmark National Bank is the holder of the mortgage. The Abundant Life Christian Center of Lamarque Inc. holds about 75% of the limited partner interests. Castle Rock, Colorado-based Arapahoe Land Investments, LP, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Case No. 11-80194) on April 5, 2011. Barbara Mincey Rogers, Esq., at Rogers & Anderson, PLLC, in Houston, Texas, serves as counsel to the Debtor. ATI ACQUISITION: Gets 'Caa2' from Moody's as School Papers Revoked ------------------------------------------------------------------ Moody's Investors Service lowered ATI Acquisition Company's corporate family rating and probability of default rating to Caa2 from B2. Concurrently Moody's lowered the rating on the senior secured credit facilities to B3 from Ba3 and the rating on the subordinated credit agreement to Caa3 from Caa1. The ratings were also placed under review for possible downgrade. Ratings downgraded: Corporate family rating to Caa2 from B2; Probability of default rating to Caa2 from B2; $17.5 million senior secured revolving credit facility due 2014 to B3 (LGD2, 29%) from Ba3 (LGD3, 30%); $155.5 million senior secured term loan due 2014 to B3 (LGD2, 29%) from Ba3 (LGD3, 30%); $90 million subordinated credit agreement due 2015 to Caa3 (LGD5, 84%) from Caa1 (LGD5, 84%). RATINGS RATIONALE The ratings downgrade was prompted by the Texas Workforce Commission's ("TWC") recent announcement that it issued a notice of Intent to Revoke Certificates of Approval for schools owned by ATI. The notice of revocation requires ATI to immediately cease enrollment of new students and initiate plans to complete the training programs of current students at all of ATI's Texas schools. The TWC announcement stated that the restrictions stem from ATI's failure to submit accurate and verifiable documentation about student completion and graduation rates. Previously, the TWC had placed restrictions on three of the company's schools due to incorrect student employment information. The magnitude of the downgrade reflects the fact that ATI's Texas-based schools account for the bulk of its revenue and profitability. In addition, Moody's is concerned that these issues could threaten ATI's eligibility to receive Title IV funds. In Moody's view, the TWC's actions could ultimately qualify as an event of default under the credit agreement. The downgrade of ATI's ratings also reflects challenging operating conditions, including the soft economic environment and increased regulatory requirements that have contributed to a declining student population and generally weaker than expected operating performance since Moody's first assigned the rating in late 2009. As a result, Moody's is concerned over the company's ability to comply with the financial covenants governing the senior secured credit facilities, particularly given step-down to the leverage ratio in coming quarters. In Moody's opinion, the TWC's actions will complicate the company's efforts to secure an amendment to the credit agreement, if needed. Moody's review will focus on the overall impact of TWC's actions on ATI's business and its eligibility for Title IV funds. The review will also consider the company's liquidity position and ability to secure an amendment to the credit agreement given covenant step-downs. The principal methodology used in rating ATI Acquisition Company was the Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. ATI, based in North Richland Hills, Texas, is a postsecondary education company focused on vocational programs that operates 24 career training centers and schools in Texas, Florida, New Mexico, Arizona, and Oklahoma. AUTOTRADER.COM INC: S&P Retains 'BB+' Corporate Credit Rating ------------------------------------------------------------- Standard & Poor's Ratings Services raised all its ratings on Atlanta-based Cox Enterprises Inc. and its related entities (except 68% owned AutoTrader.com Inc. [BB+/Stable/--]). "We raised our long-term corporate credit rating to 'BBB' from 'BBB-' and our short-term rating to 'A-2' from 'A-3'. The outlook is stable," S&P said. "The upgrade recognizes improvement in financial metrics," said Standard & Poor's credit analyst Richard Siderman, "reflecting solid cash flow generation at the core cable TV operations, including consolidated adjusted debt/EBITDA below 3x, and our expectation that those improvements will be sustained." "The stable outlook reflects our view that maturity of the cable operations, as well as financial policy, will likely limit further improvement in financial metrics. But we also see little downside rating pressure given the good revenue characteristics of the core cable operations, along with our expectation of continued prudent financial policy." "The upgrade recognizes the trend of improved adjusted debt leverage, reflecting solid results at the company's core," added Mr. Siderman, "and well-positioned cable TV operations, enabling the repayment of more than $2 billion of debt over the past two years." "The company reported approximately $10.5 billion of debt outstanding at March 31, 2011. Adjusted debt to EBITDA was 2.8x for the past three fiscal quarters (on a rolling-12-month basis) improved from the low- to mid-3x range realized during 2009. Our view of a continued prudent financial policy from family- controlled Cox is an additional rating consideration." AVIS BUDGET: S&P Rates $600-Million Term Loans at 'BB' ------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'BB' issue-level ratings to Avis Budget Car Rental LLC's (Avis Budget) proposed $200 million secured term loan A and $400 million term loan B, and placed those ratings on CreditWatch with negative implications. The recovery rating on these issues is '1', indicating our expectation that lenders would receive very high (90% to 100%) recovery of principal in the event of a payment default. Avis Budget is the major operating subsidiary of Avis Budget Group Inc. "At the same time, we are maintaining our 'BB' issue-level rating and '1' recovery rating on Avis Budget's $1.5 billion secured revolver maturing in 2016 (a $300 million increase from current $1.2 billion). The rating remains on CreditWatch, where we placed it with negative implications on June 14, 2011, after the company announced its acquisition of U.K. car renter Avis Europe PLC. Based on our understanding of the deal, we would likely affirm the corporate credit rating and assign a stable outlook upon the closing of the proposed merger, or possibly earlier," S&P related. The company will use the proceeds from the increase in the revolver and the term loans, along with cash and other debt, for its planned $1.8 billion acquisition of Avis Europe, including repayment of its debt, expected to close in early October 2011. "Our ratings on the increased revolver and new term loans assume the successful completion of the acquisition on the proposed terms. However, even if the acquisition were not to conclude successfully, we would expect to maintain our '1' recovery rating on the revolving credit and term loans," S&P related. Ratings List Avis Budget Car Rental LLC Corporate credit rating B+/CW Neg/-- Avis Budget Car Rental LLC $1.5 bil. sec revolver BB/CW Neg/-- Recovery Rating 1 New Ratings/CreditWatch Action Avis Budget Car Rental LLC $200 mil sec term loan A BB/CW Neg/-- Recovery Rating 1 $400 mil sec term loan B BB/CW Neg/-- Recovery Rating 1 AWAL BANK: HSBC Loses Bid to Dismiss Chapter 11 Case & Lawsuit -------------------------------------------------------------- Charles Russell LLP, the External Administrator of Awal Bank BSC, won permission from the U.S. Bankruptcy Court to file the Debtor's schedules of assets and liabilities, a statement of financial affairs and operating reports without the Creditor Claim Information. Bankruptcy Judge Allan L. Gropper denied HSBC Bank USA, N.A.'s motions to dismiss Awal's chapter 11 case and the adversary proceeding against it. The External Administrator had sued to avoid or invalidate HSBC's set-off of $12,996,220.98 of the Debtor's money two weeks before the opening of insolvency proceedings in Bahrain. The External Administrator also is seeking relief from one of the usual duties of a chapter 11 debtor -- viz. to disclose the details of each creditor's claim. In the alternative, the External Administrator seeks authorization to file the amount of each creditor's claim under seal. HSBC contends (i) that the requested relief should be denied, (ii) that the chapter 11 case should be dismissed altogether; and (iii) whether or not the entire chapter 11 case is dismissed, the adversary proceeding should be dismissed for failure to state a claim on which relief can be granted. The United States Trustee has also objected to filing the details of each creditor's claim under seal. Judge Gropper acknowledged that several of the matters addressed in his opinion raise issues of first impression under chapter 15, including (i) the contours of a chapter 11 case brought subsequent to chapter 15 recognition and (ii) whether the External Administrator can sustain the Complaint against HSBC's motion to dismiss and pursue its efforts to avoid or invalidate the set-off. Judge Gropper said the motion to dismiss the adversary proceeding will be denied as HSBC has not, on the pleadings and as a matter of law, demonstrated that (X) the External Administrator's 11 U.S.C. Sec. 553(b) action is untimely, (Y) Article 4A of the UCC preempts the External Administrator's common law claims or (Z) the so-called discharge for value rule precludes the relief sought. Judge Gropper said the External Administrator has leave to move to consolidate the chapter 15 and chapter 11 cases. The lawsuit is Charles Russell, LLP, London, as External Administrator of Awal Bank, BSC, v. HSBC Bank USA, N.A., Adv. Proc. No. 11-01535 (Bankr. S.D.N.Y.). A copy of Judge Gropper's Aug. 4, 2011 Memorandum of Opinion is available at http://is.gd/wKTx9Bfrom Leagle.com. About Awal Bank Awal Bank BSC is a Bahrain lender owned by Saudi Arabian Saad Group. Awal Bank was principally an investment company that provides wholesale banking services in Bahrain including the acceptance of deposits and the making of loans. Awal Bank was taken into administration by the Central Bank of Bahrain on July 30, 2009, after defaulting on loans. U.S. lawyers for the bank said last year that under Bahrain law, Awal's administrator had two years to decide if the bank should liquidate or be returned to management and shareholders. Stewart Hey, Esq., at Charles Russell LLP, as external administrator of Awal Bank, made a voluntary petition under Chapter 15 of the U.S. Bankruptcy Code for the bank (Bankr. S.D.N.Y. Case No. 09-15923) on Sept. 30, 2009, following the administration proceedings. In 2010, the bank began experiencing a liquidity squeeze brought, in part, by the global economic crisis. The bank ceased to operate as a going concern since it was place into administration. Awal Bank filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 10-15518) in Manhattan on Oct. 21, 2010. The Debtor estimated $50 million to $100 million and debts in excess of $1 billion as of the petition date. The External Administrator is represented in the U.S. proceedings by lawyers at Brown Rudnick LLP. Counsel to HSBC Bank USA, National Association, are: William J. Brown, Esq. David J. McNamara, Esq. Allan L. Hill, Esq. 3400 HSBC Center Buffalo, NY 14203-2887 Tel: (716) 847-7089 E-mail: wbrown@phillipslytle.com dmcnamara@phillipslytle.com ahill@phillipslytle.com BELTWAY ONE: Files Schedules of Assets and Liabilities ------------------------------------------------------ Beltway One Development filed with the U.S. Bankruptcy Court for the District of Nevada its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $15,500,000 B. Personal Property $1,339,074 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $13,024,842 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $27,768 ----------- ----------- TOTAL $16,839,074 $13,052,610 Ten Saints LLC, a debtor-affiliate also filed its schedules disclosing assets of $14,766,851 and liabilities of $14,195,600. About Horizon Village, et al. Four related Las Vegas, Nevada-based entities sought Chapter 11 bankruptcy protection on July 13, 2011. The businesses are owned or managed by local business people and firms, including Todd Nigro, Nigro Development LLC, a Nigro family trust and other investors. Horizon Village Square LLC (Bankr. D. Nev. Case No. 11-21034) owns the Vons-anchored Horizon Village Square Shopping Center near I- 515 and Horizon Drive in Henderson. The property includes five retail buildings with nearly 43,000 square feet of space. Ten Saints LLC (Bankr. D. Nev. Case No. 11-21028) owns the 134- room Hampton Inn & Suites at St. Rose Parkway and Seven Hills Drive in Henderson. Beltway One Development Group LLC (Bankr. D. Nev. Case No. 11- 21026) owns the Desert Canyon Business Park at Russell Road and the Las Vegas Beltway. It has two buildings and 15 acres. Nigro HQ LLC (Bankr. D. Nev. Case No. 11-21014) owns an office building at 9115 W. Russell Road occupied by Bank of George, Infinity Plus LLC and Nigro Construction Inc. Todd Nigro said the four bankruptcies were caused by threatened foreclosures -- typically related to Wells Fargo Bank demanding payments to keep loan-to-value ratios at specified levels. Judge Mike K. Nakagawa presides over the cases. Lawyers at Gordon Silver serve as the Debtors' bankruptcy counsel. The bankruptcy petitions estimated assets and debts from $1 million to $10 million each for Nigro HQ; and from $10 million to $50 million in both assets and debts for Horizon Village, Ten Saints and Beltway One. A fifth-related business, Russell Boulder LLC, filed for bankruptcy (Bankr. D. Nev. Case No. 10-29724) on Oct. 19, 2010. It owns the 600-suite Siena Suites extended stay property at Boulder Highway and Russell Road. BLACK WOLF: Case Summary & 11 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Black Wolf Partners, Ltd. P.O. Box 1540 Marble Falls, TX 78654 Bankruptcy Case No.: 11-11945 Chapter 11 Petition Date: August 2, 2011 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: Frank B. Lyon, Esq. 6836 Austin Center Blvd., Suite 150 Austin, TX 78731 Tel: (512) 345-8964 Fax: (512) 697-0047 E-mail: frank@franklyon.com Scheduled Assets: $4,781,453 Scheduled Debts: $3,235,720 A list of the Company's 11 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txwb11-11945.pdf The petition was signed by Steve Hurst, president of Black Wolf Dev., general partner. BLUEGREEN CORP: Stops Offering Under Retirement Plan ---------------------------------------------------- Bluegreen Corporation filed with the U.S. Securities and Exchange Commission a Post-Effective Amendment No. 1 relating to the Registration Statement on Form S-8, which was filed with the SEC and became effective on Sept. 29, 1998. The Registration Statement registered an aggregate of 3,000,000 shares of the Company's common stock to be offered and sold pursuant to the Bluegreen Corporation Retirement Savings Plan, the Bluegreen Corporation 1995 Stock Incentive Plan and the Bluegreen Corporation 1998 Non-Employee Director Stock Option Plan. The Registration Statement also registered an indeterminate amount of interests to be offered and sold pursuant to the Retirement Plan. The Company has ceased offering its common stock as an investment option under the Retirement Plan. Accordingly, the Company filed this Post-Effective Amendment No. 1 to the Registration Statement to withdraw the Retirement Plan from the Registration Statement and to deregister the Retirement Plan Interests issuable under the Registration Statement. About Bluegreen Corp. Bluegreen Corporation -- http://www.bluegreencorp.com/-- provides places to live and play through its resorts and residential community businesses. In December 2010, Standard & Poor's Rating Services raised its corporate credit rating on Bluegreen Corp to 'B-' from 'CCC'. S&P's rating outlook on the Company is stable. S&P believes that Bluegreen will grow its fee-based sales commission revenue from $20 million in 2009 to an estimated $50 million in 2010. At this time, S&P expects that Bluegreen may be able to generate at least the same amount of commission based revenue in 2011. While the increase in fee- based revenue allowed Bluegreen to expand the level of sales that do not require financing, S&P believes that the company will likely remain heavily reliant on its lines of credit, receivable- backed warehousing facilities, and access to the timeshare securitization markets to fund timeshare sales. In S&P's view, Bluegreen currently has adequate sources of liquidity to cover its needs over the next 12-18 months mainly due to the successful closing of a timeshare securitization transaction. The Company reported a net loss of $35.87 million on $365.67 million of revenue for the year ended Dec. 31, 2010, compared with net income of $3.90 million on $367.36 million of revenue during the prior year. The Company's balance sheet at March 31, 2011, showed $1.21 billion in total assets, $892.12 million in total liabilities, and $320.03 million in total shareholders' equity. * * * In December 2010, Standard & Poor's Rating Services raised its corporate credit rating on Bluegreen Corp to 'B-' from 'CCC'. S&P's rating outlook on the Company is stable. S&P believes that Bluegreen will grow its fee-based sales commission revenue from $20 million in 2009 to an estimated $50 million in 2010. At this time, S&P expects that Bluegreen may be able to generate at least the same amount of commission based revenue in 2011. While the increase in fee- based revenue allowed Bluegreen to expand the level of sales that do not require financing, S&P believes that the company will likely remain heavily reliant on its lines of credit, receivable- backed warehousing facilities, and access to the timeshare securitization markets to fund timeshare sales. In S&P's view, Bluegreen currently has adequate sources of liquidity to cover its needs over the next 12-18 months mainly due to the successful closing of a timeshare securitization transaction. BNC MORTGAGE: Famatiga Suit v. Mortgage Firms Dismissed ------------------------------------------------------- District Judge Sean F. Cox granted the defendants' request for summary judgment and dismissed the lawsuit, Martin Famatiga and, Heather Kerchen-Famatiga, v. Mortgage Electronic Registration Systems, Inc., et al., Case No. 10-10937 (E.D. Mich.). Martin Famatiga and Heather Kerchen-Famatiga sued Mortgage Electronic Registration Systems, Inc., U.S. Bank National Association, America's Servicing, BNC Mortgage, and IT Mortgage in Livingston County Circuit Court. Plaintiffs alleged 12 violations of state and federal law relating to Plaintiffs' mortgage agreement. Defendants removed the action to the Eastern District of Michigan, asserting federal question jurisdiction. On March 25, 2010, the Court remanded all of Plaintiffs' state-law claims. The matter is currently before the Court on MERS, U.S. Bank and America's Servicing Company's Motion for Summary Judgment on the remaining federal claims. Any claims against BNC Mortgage are stayed because BNC Mortgage filed for Chapter 11 bankruptcy on Jan. 9, 2009. IT Mortgage is no longer in operation. A copy of the Court's Aug. 2, 2011 Opinion and Order is available at http://is.gd/9uKjq5from Leagle.com. BORDERS GROUP: Executives Leave; Alix's Etlin Takes Over -------------------------------------------------------- Borders Group, Inc. reported to the U.S. Securities and Exchange Commission on August 4, 2011, that the employment of Michael J. Edwards, president of the Company, and Scott D. Henry, executive vice president and chief financial officer of the Company, terminated as of July 29, 2011. Effective July 29, Holly Felder Etlin, the Company's senior vice president for restructuring, was appointed as president of the Company, and Glen Tomaszewski, the Company's vice president, chief accounting officer and controller, was appointed as treasurer of the Company. Ms. Etlin, age 54, has served as the Company's senior vice president for restructuring since February 2011. She is a managing director of AlixPartners, a global business advisory firm that provides financial restructuring, bankruptcy reorganization and other advisory services. AlixPartners has been engaged since February 2011 to provide financial restructuring and bankruptcy reorganization advisory services to Borders and its subsidiaries. Mr. Tomaszewski, age 41, has served as vice president, chief accounting officer and controller of the Company since October 2010 and has held various positions within the Company's financial reporting function since January 1998. In other disclosures, Borders said it has received an initial payment pursuant to an agency agreement that the Company has used to repay in full all outstanding obligations under its debtor-in- possession financing. As previously disclosed, on February 16, 2011, the Company and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York under the caption "In re Borders Group, Inc., et al." On July 13, 2011, the Company entered into an Agency Agreement with Hilco Merchant Resources, LLC, Gordon Brothers Retail Partners, LLC, SB Capital Group, LLC, Tiger Capital Group, LLC and Great American Group, LLC. The Agency Agreement provides for the sale in liquidation of the inventory, fixtures and other assets of all or substantially all of the Company's retail book stores as well as certain other assets of the Company and its subsidiaries. On July 21, 2011, the Bankruptcy Court approved the Agency Agreement and authorized the Company to commence its sale in liquidation pursuant to the Agency Agreement. Borders' merchandise is being marked down from 25% to 50% at 397 stores, according to Richard Kaye, executive vice president of Hilco, in an e-mailed statement to The Detroit News. Moreover, the discount offered on Borders Rewards Plus Cards has been extended through August 7, 2011, the report added. Borders Comments on Shares Trading Borders cautioned its shareholders that trading in shares of the Company's common stock during the pendency of its Chapter 11 bankruptcy proceedings is highly speculative and poses substantial risks. The Company is currently in the process of liquidation and expects that all outstanding shares of its common stock will be cancelled and extinguished upon confirmation of a Chapter 11 liquidation plan by the Bankruptcy Court. In this event, the Company's shareholders will not receive or retain any cash, securities or other property on account of their cancelled shares of common stock. As a result, the Company believes that shares of its currently outstanding common stock have no value. Trading prices for the Company's common stock may bear little or no relationship to the actual recovery, if any, by holders in our Chapter 11 bankruptcy proceedings. Accordingly, the Company urges extreme caution with respect to existing and future investments in its common stock. According to The Detroit News, Borders' shares were selling on August 4, 2011, for less than 2 cents at OTC Markets, the New York firm that operates the trading platform for more than 10,000 unlisted stocks. About Borders Group Borders Group operates book, music and movie superstores and mall- based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders-branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e-commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. Lowenstein Sandler represents the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group is closing 399 stores. Borders selected proposals by Hilco and Gordon Brothers to conduct going out of business sales for all stores after no going concern offers of higher value were submitted by the deadline. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000 BORDERS GROUP: Parties Oppose Terms of IP Assets, Leases Sale ------------------------------------------------------------- Several landlords and creditors oppose the bidding procedures and certain aspects relating to the proposed sale of Borders Group, Inc.'s intellectual property assets and unexpired real property leases. Borders Group, and its debtor affiliates are seeking permission from Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York to sell substantially all of their intellectual property assets, free and clear of all interests, to the highest bidder. To this end, the Debtors ask the Court to approve uniform procedures to govern the bidding, auction and sale of the IP Assets. Certain landlords led by The Macerich Company complain to the Court that they cannot effectively evaluate any proposed assignee until they can identify the proposed tenant, proposed use and review and assess adequate assurance of future performance information. The Landlords allege that the proposed expedited auction process denies them the protections Congress conferred under the Bankruptcy Code. Indeed, the Debtors propose bidding and lease sale procedures that potentially delay delivery of the information until after the bidding procedures objection deadline, according to the Landlords. The Landlords thus ask the Court to modify the schedule in connection with the sales to create a reasonable time for the Landlords to (i) review adequate assurance information, and if necessary: and (ii) to conduct discovery, object, and schedule an evidentiary hearing on any assumption and assignment of the Leases. The Landlords also seek clarification that any sale order must not be free and clear of all obligations to pay all charges due under the Leases, including unbilled year-end adjustments and reconciliations. With respect to the auction of leases, the Landlords want the proposed bidding procedures to be modified to ensure that in the event any of the leases are moved to the first round lease auction, the landlords will still be allowed an opportunity to bid on their leases, should they so desire. Moreover, should any landlord wish to credit bid its cure amount, that is value in and of itself, and the landlord should not be compelled to pay cash on top of its credit bid just to participate in the auction, the Landlords propose. The Landlords add that they should be permitted to bid either a credit bid of all or a portion of the cure amount or a termination of the leases with a waiver of all or a portion of its rejection damages. The objecting landlords are: * Mid-America Asset Management, Inc. * Westfield, LLC * Inland U.S. Management, LLC * Winter Park Town Center, Ltd. * Centro Properties Group; * The Port of Seattle * S.R. Weiner & Associates * DCT/SPF Borders General Partnership * Salmon Run Shopping Center, L.L.C.; Champlain Centre North, L.L.C.; Crystal Run NewCo, LLC; Independence Center, LLC; Crossgates Commons NewCo, LLC; and Lebanon * Macy's Retail Holdings, Inc.; Glimcher Properties Limited Partnership; RVM Glimcher, LLC; Grand Central Parkersburg LLC; and ATC Glimcher, LLC Folsom Broadstone, Inc.; Simon Property Group, Inc.; the Taubman Landlords; the Cafaro Related Entities and Shelbyville Road Plaza, LLC adopt the Objecting Landlords' arguments. Contract counterparties filed responses, asking the Court to fix the cure amounts and direct the Debtors to cure all defaults under their leases and contracts. The contract counterparties include: Proposed Asserted Counterparty Cure Amt. Cure Amt. ------------ --------- ---------- Mid-America Asset Management, Inc. $94,731 $188,139 JJH Midtown Leasehold Owners LLC 77,657 94,870 Cole BD Rapid City SD, LLC 0 26,604 The Court will consider the Debtors' bidding procedures for the IP Assets Sale and Lease Sale on August 10, 2011. Schedule of Leases Borders Group, Inc. and its debtor affiliates submitted to Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York a schedule containing proposed cure amounts for leases subject to their motions to sell intellectual property assets and unexpired non-residential real property leases. The proposed cure amounts schedule is available for free at: http://bankrupt.com/misc/Borders_CureAmtSched.pdf About Borders Group Borders Group operates book, music and movie superstores and mall- based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders-branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e-commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. Lowenstein Sandler represents the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group is closing 399 stores. Borders selected proposals by Hilco and Gordon Brothers to conduct going out of business sales for all stores after no going concern offers of higher value were submitted by the deadline. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000 BORDERS GROUP: Camelot LLC Wants to File Late Claim --------------------------------------------------- Camelot LLC asks Judge Martin Glenn to grant it leave to file an untimely proof of claim against Borders, Inc. Borders entered into a lease with Block E Interests, LLC, to lease space and operate a bookstore in the Block E complex in downtown Minneapolis. Pursuant to the Lease, Borders was responsible for paying a share of the common area expenses and taxes on the shopping center in which the Premises were located. Borders disputed the amounts it had previously paid for the Shared Expenses. Camelot bought Block E and became the landlord under the Lease. As of August 2, 2011, the dispute remains unresolved. The Court entered an order rejecting the Lease effective as of the Petition Date and requiring Camelot to file its proof of claim by April 18, 2011, or by the general claims bar date. As it became clear that the dispute would not be resolved, Camelot began preparing its proof of claim, Salvatore Barbatano, Esq., at Shaw Gussis Fishman Glantz Wolfson & Towbin LLC, in Chicago, Illinois - - sbarbatano@shawgussis.com -- says. In order to properly allege that certain Shared Expenses were due and owing from Borders, Camelot had to collect information from taxing authorities and Block E, he stresses. Collecting this information was a lengthy process in which Camelot did not gain access to all of the required information until June 15, 2011, Mr. Barbatano states. As a result of the expection of Camelot and its attorneys that the General Bar Date Notice would be sent to Camelot's attorneys, the landlord's proof of claim was not filed before the General Bar Date, he asserts. Mr. Barbatano argues that cause exists for Camelot to be granted leave to file its late claim. Given that Borders' and Camelot's attorneys had engaged in extensive negotiation regarding the Dispute, including negotiations over the Proof of Claim, Camelot believed that the General Bar Date Notice would be sent to its attorneys, he contends. If allowed in full, Camelot's Proof of Claim is $2,446,658, which will represent at most 0.1% of the total amount of unsecured claims in the Debtors' Chapter 11 cases, Mr. Barbatano says. He also assures the Court that Camelot's minimal delay in filing its proof of claim has no impact on the judicial proceedings. About Borders Group Borders Group operates book, music and movie superstores and mall- based bookstores. At Jan. 29, 2011, the Debtors operated 642 stores, under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders-branded airport stores in the United States, of which 639 stores are located in the United States and 3 in Puerto Rico. In addition, the Debtors operate a proprietary e-commerce Web site, http://www.Borders.com/, launched in May 2008, which includes both in-store and online e-commerce components. As of Feb. 11, 2011, Borders employed a total of 6,100 full-time employees, 11,400 part-time employees, and approximately 600 contingent employees. Borders Group Inc. and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. Lead Case No. 11-10614) in Manhattan on Feb. 16, 2011. David M. Friedman, Esq., David S. Rosner, Esq., Andrew K. Glenn, Esq., and Jeffrey R. Gleit, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, serve as counsel to the Debtors. Jefferies & Company's Inc. is the financial advisor. DJM Property Management is the lease and real estate services provider. AP Services LLC is the interim management and restructuring services provider. The Garden City Group, Inc., is the claims and notice agent. Attorneys at Morgan, Lewis & Bockius LLP, and Riemer & Braunstein LLP, serve as counsel to the DIP Agents. Lowenstein Sandler represents the official unsecured creditors committee for Borders Group. Bruce S. Nathan and Bruce Buechler, members of Lowenstein Sandlers' Bankruptcy, Financial Reorganization & Creditors' Rights Group, are leading the team. The Debtor disclosed $1.28 billion in assets and $1.29 billion in liabilities as of Dec. 25, 2010 Borders Group is closing 399 stores. Borders selected proposals by Hilco and Gordon Brothers to conduct going out of business sales for all stores after no going concern offers of higher value were submitted by the deadline. Bankruptcy Creditors' Service, Inc., publishes BORDERS GROUP BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Borders Group Inc., the United States' second largest bookstore chain. (http://bankrupt.com/newsstand/or 215/945-7000 BRIDGE VIEW: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Bridge View Palace LLC 341 Wallabout Street, Suite 1A Brooklyn, NY 11206 Bankruptcy Case No.: 11-46701 Chapter 11 Petition Date: August 2, 2011 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Joel B. Rosenthal Debtor's Counsel: Leo Fox, Esq. LAW OFFICE OF LEO FOX 630 Third Avenue, 18th Floor New York, NY 10017 Tel: (212) 867-9595 Fax: (212) 949-1857 E-mail: leofox1947@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Aron Kapelyus, president. CDC PROPERTIES II: Hires Graham & Dunn as Replacement Counsel ------------------------------------------------------------- CDC Properties II LLC seeks permission from the U.S. Bankruptcy Court for the Western District of Washington to employ and retain Graham & Dunn PC as replacement counsel. Upon retention, the firm, will among other things: 1. provide legal advice with respect to the Debtor's powers and duties as debtor-in-possession in the continued operation of their businesses and management property; 2. take necessary action to protect and preserve the Debtor's Estate, including the prosecution of actions on behalf of the Debtor, the defense of any actions commenced against the Debtor, the negotiations concerning all litigation in which the Debtor is involved, and the objection to claims filed against the Debtor's estate; and 3. represent the Debtor in carrying out its duties and exercising its powers under the Bankruptcy Code. Graham & Dunn PC has not received a retainer or advance fee deposit from the Debtor in connection with filing of this bankruptcy case. Subject to the Court's approval, Graham & Dunn PC will charge the Debtor for legal services on an hourly basis in accordance with its ordinary and customary rates as in effect on the dates services are rendered. About CDC Properties II LLC Tacoma, Washington-based CDC Properties II LLC filed for Chapter 11 bankruptcy (Bank. W.D. Wash. Case No. 11-44554) on June 2, 2011. Judge Paul B. Snyder presides over the case. Brad A. Goergen, Esq., at Graham & Dunn PC, serves as bankruptcy counsel. In its petition, the Debtor estimated $10 million to $50 million in assets and debts. The petition was signed by Thomas W. Price, member/manager. Affiliate CDC Properties I, LLC, sought Chapter 11 protection (Case No. 10-41010) on Feb. 2, 2010. Prium Kent Retail, LLC. Prium Lakewood Buildings, and Prium Meeker Mall LLC filed separate Chapter 11 petitions in 2010. CENTRAL FALLS, R.I.: Judge Wants City Back on Track ASAP -------------------------------------------------------- Bob Thayer at The Providence Journal reports that the first hearing on the Central Falls bankruptcy petition got under way in federal court last week with Judge Frank J. Bailey assuring more than two dozen lawyers representing a wide array of interests that everyone will be treated fairly, and that he wants the city back on track as soon as possible. According to the report, Judge Bailey said that municipal filings for Chapter 9 bankruptcy are rare, and he understands that the decision to declare insolvency is one of "last resort." About Central Falls Central Falls is a city in Providence County, Rhode Island. The population was 18,928 at the 2000 census. Central Falls is the smallest and most densely populated city in Rhode Island. Central Falls sought bankruptcy protection under Chapter 9 of the U.S. Bankruptcy Code (Bankr. D. R.I. Case No. 11-13105) on Aug. 1, 2011. The Chapter 9 filing was made after former Rhode Island Supreme Court Judge Robert Flanders, who serves as state-appointed receiver for the city, was unable to negotiate significant concessions from unions representing police officers, firefighters and other city workers. The city grappled with an $80 million unfunded pension and retiree health benefit liability that is nearly quadruple its annual budget of $17 million. Judge Robert Flanders succeeded the role from retired Superior Court Associate Justice Mark A. Pfeiffer, who was appointed in July 2010. Judge Frank Bailey presides over the Chapter 9 case. Theodore Orson, Esq., at Orson and Brusini Ltd., serves as bankruptcy counsel to the receiver. CLAIM JUMPER: Sets Plan Confirmation as Black Canyon Settles ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the remnants of Claim Jumper Restaurants LLC will return to bankruptcy court on Sept. 23 for approval of the liquidating Chapter 11 plan. The bankruptcy court in Delaware signed an order on Aug. 3 approving the disclosure statement containing information from which creditors can decide whether to vote for or against the plan. Mr. Rochelle relates that scheduling a confirmation hearing was made possible through settlement brought about in mediation between the official creditors' committee and subordinated noteholder Black Canyon Capital LLC. The committee was seeking subordination of Black Canyon's claim. Mr. Rochelle recounts that early in the case when the business was being sold, the secured lenders agreed to a carveout from sale proceeds to forestall objection to the sale from the creditors' committee. The disclosure statement says that the trust for creditors was funded with $1.835 million. The disclosure statement on the court's file still had blanks where unsecured creditors would be told the size of a recovery to expect. From the settlement, Black Canyon won't participate in the trust for unsecured creditors. Instead, it will receive $475,000 from the trust. The disclosure statement says that secured creditors with claims of $69.2 million can expect a 54% recovery, according to the report. About Claim Jumper Irvine, California-based Claim Jumper Restaurants, LLC -- http://www.claimjumper.com/-- operated a chain of casual dining restaurants. It was founded in 1977. It had locations in Arizona, California, Colorado, Illinois, Nevada, Oregon, Washington, and Wisconsin. Claim Jumper filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 10-12819) on Sept. 10, 2010. The Debtor estimated its assets at $50 million to $100 million and debts at $100 million to $500 million as of the Petition Date. The Debtor's affiliate, Claim Jumper Management, LLC, filed a separate Chapter 11 petition (Bankr. D. Del. Case No. 10-12820). Curtis A. Hehn, Esq., and James E. O'Neill, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Del., are the Debtors' local counsel. Attorneys at Milbank, Tweed, Hadley & McCloy LLP, in Los Angeles, Calif., are the Debtors' general bankruptcy counsel. Piper Jaffray & Co. is the Debtors' financial advisors and investment bankers. Kurtzman Carson Consultants LLC is the Debtors' notice, claims and solicitation agent. The Creditors Committee has selected Klehr Harrison Harvey Branzburg LLP, in Wilmington, Del. as counsel. In December 2010, Claim Jumper completed the sale its business to Landry's Restaurants Inc., in a transaction valued at $76.6 million. Landry's outbid the offer of holders of mezzanine debt with a winning bid that included $48.3 million cash, the assumption of $23.3 million in debt, and $5 million cash to collateralize existing letters of credit. The Debtor changed its name to Goldcoast Liquidating LLC following the sale. CLEAR CREEK: Files New Schedules of Assets & Liabilities -------------------------------------------------------- Clear Creek Ranch II LLC filed with the U.S. Bankruptcy Court for the Western District of Nevada, its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------- ----------- A. Real Property $18,000,000 B. Personal Property $1,306,593 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $17,498,668 E. Creditors Holding Unsecured Priority Claims $286,921 F. Creditors Holding Unsecured Non-priority Claims $39,377,604 ----------- -------------- TOTAL $19,306,593 $57,163,193 About Clear Creek Ranch II Minden, Nevada-based Clear Creek Ranch II LLC owns a 530.74-acre undeveloped residential subdivision located within the project known as Clear Creek. That project included a world-class golf course, the residential subdivision around the golf course, a lake house on Lake Tahoe and a fly fishing ranch along the West Walker River. The co-developers and joint venturers of the Project are CCR II's affiliate, Clear Creek at Tahoe LLC, and entities affiliated with Nevada businessman John Serpa, Sr., and his sons. Clear Creek Ranch II and Clear Creek at Tahoe filed separate Chapter 11 bankruptcy petitions (Bankr. D. Nev. Case Nos. 11-52302 and 11-52303) on July 18, 2011. Judge Bruce T. Beesley presides over the cases. The Debtors are represented by: Thomas E. Gibbs, Esq. Vincent M. Coscino, Esq. Brian R. Bauer, Esq. ALLEN MATKINS LECK GAMBLE MALLORY & NATSIS LLP 1900 Main Street, Fifth Floor Irvine, CA 92614-7321 Tel: (949) 553-1313 Fax: (949) 553-8354 E-mail: tgibbs@allenmatkins.com vcoscino@allenmatkins.com bbauer@allenmatkins.com The Law Offices of Amy N. Tirre also serves as the Debtors' counsel. In its petition, Clear Creek Ranch II estimated assets and debts of $10 million to $50 million. The petitions were signed by James S. Taylor, the Trustee. CNO FINANCIAL: S&P Raises Counterparty Credit Rating to 'B+' ------------------------------------------------------------ Standard & Poor's Ratings Services raised its counterparty credit rating on CNO Financial Group Inc. to 'B+' from 'B' and its counterparty credit and financial strength ratings on CNO Financial's operating companies to 'BB+' from 'BB'. The outlook on all these companies is stable. "The ratings on CNO Financial Group reflect the companies' significantly improved operating performance, financial flexibility, and -- to a lesser extent -- capitalization in the past two years," said Standard & Poor's credit analyst Kevin Maher. As of June 30, 2011, CNO Financial had about $935 million in notes payable (debt outstanding), of which only $35 million in required principal payments is due over the next 18 months. The equity offering, the debt repurchases, and the senior notes in the past year have all helped enhance corporate liquidity. "We believe that the group's focus on lower-risk life and Medicare Supplement products, the use of reinsurance for riskier products such as long-term care, and strong investment returns have contributed to an increase in earnings in 2010 and 2011," said Mr. Maher. "We expect CNO Financial to further increase earnings with new business, which likely will contribute to an improving capital position and provide a cushion against the covenants over the next several years. Top-line growth in core lines has been good, although the run-off business is shrinking faster than the group is producing new business." "We do not expect any further significant investment losses or unexpected declines in improving operating performance over the next two years. The primary sources of cash at the holding company are dividends from the operating companies, interest on surplus debentures, and management and investment fees. Despite pressures from the holding company on its operating companies to improve risk-adjusted capitalization to stay within covenants, which, in turn, compels the operating companies to minimize dividends, the operating companies paid dividends of $138 million in the first half of 2011," S&P related. "We consider CNO Financial's risk-based capitalization to be a weakness to the rating, as measured by Standard & Poor's stress capital model. However, following strong earnings in the first half of 2011 and the contribution of funds from the equity raise to pay down some existing debt, we expect capitalization to continue to improve and become supportive of the rating over the next two years. Overall, CNO Financial's consolidated National Assn. of Insurance Commissioners risk-based capital ratio (NAIC RBC company action level) was about 351% on June 30, 2011, which is up by about 10% from the midyear 2010 level. Bankers Life & Casualty reports the weakest NAIC RBC ratio, at 279%, down 5% in the past year," S&P said. "We expect CNO Financial to maintain adequate capital at all of its operating companies and to move capital from the holding company or from another operating company to boost Bankers Life & Casualty's capital levels. We consider the group's competitive position to be adequate, and its operating performance is improving," S&P related. COMMERCIAL VEHICLE: Files Form 10-Q; Incurs $2.2-Mil. Loss in Q2 ---------------------------------------------------------------- Commercial Vehicle Group, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting a net loss of $2.17 million on $206.77 million of revenue for the three months ended June 30, 2011, compared with net income of $693,000 on $142.35 million of revenue for the same period during the prior year. The Company also reported net income of $1.11 million on $389.28 million of revenue for the six months ended June 30, 2011, compared with net income of $1.37 million on $288.75 million of revenue for the same period a year ago. The Company's balance sheet at June 30, 2011, showed $392.21 million in total assets, $387.09 million in total liabilities and $5.11 million in total stockholders' investment. A full-text copy of the Form 10-Q is available for free at: http://is.gd/iDDdvN About Commercial Vehicle Group New Albany, Ohio-based Commercial Vehicle Group, Inc., (Nasdaq: CVGI) supplies fully integrated system solutions for the global commercial vehicle market, including the heavy-duty truck market, the construction and agricultural markets, and the specialty and military transportation markets. The Company has facilities located in the United States in Arizona, Indiana, Illinois, Iowa, North Carolina, Ohio, Oregon, Tennessee, Virginia and Washington and outside of the United States in Australia, Belgium, China, Czech Republic, Mexico, Ukraine and the United Kingdom. * * * Commercial Vehicle carries a 'Caa2' Corporate Family Rating and 'Caa2/LD' Probability of Default Rating from Moody's. It has 'CCC+' issuer credit ratings from Standard & Poor's. In mid-October 2010, Moody's Investors Service upgraded Commercial Vehicle Group, Inc.'s Corporate Family Rating to Caa1 from Caa2, and revised the ratings outlook to positive from negative. These positive actions recognize the continuing improvement in the build rates for commercial vehicles and the realized benefits of the company's operating and capital restructurings. According to Moody's, the Caa1 CFR reflects modest size, high debt leverage, and exposure to highly cyclical commercial vehicle end markets. Demand for commercial vehicle components is sensitive to both economic cycles and regulatory implementation schedules. As reported by the TCR on April 12, 2011, Standard & Poor's Ratings Services said it raised its corporate credit rating on New Albany, Ohio-based Commercial Vehicle Group Inc. (CVG) to 'B-' from 'CCC+'. "The upgrade reflects our assumption that CVG can improve EBITDA and cash flow in the next two years, because we believe commercial truck production volumes will continue to rise year-over-year in 2011 and 2012," said Standard & Poor's credit analyst Nancy Messer. Heavy-duty truck production increased by a meaningful 30% in 2010, leading to a 30% year-over-year sales increase. COMMERCIAL VEHICLE: To Issue 1.4 Million Common Shares Under Plan ----------------------------------------------------------------- Commercial Vehicle Group, Inc., registered an additional 1,400,000 shares of its common stock, par value $0.01 per share, for issuance under the Commercial Vehicle Group, Inc. Fourth Amended and Restated Equity Incentive Plan. The increase in the number of shares authorized for issuance under the Plan was approved by the Company's stockholders at the Company's 2011 annual meeting held on May 12, 2011. The Company previously filed a Registration Statement on Form S-8 on May 3, 2005, covering 1,000,000 shares of the Company's Common Stock authorized for issuance under the original version of the Plan. On Aug. 3, 2007, the Company filed an additional Registration Statement on Form S-8 to register an additional 1,000,000 shares of the Company's Common Stock pursuant to the second amendment and restatement of the Plan that increased the number of shares authorized for issuance under the Plan, as approved by the Company's stockholders at the Company's 2007 annual meeting of stockholders. On Aug. 10, 2009, the Company filed an additional Registration Statement on Form S-8 to register an additional 1,200,000 shares of the Company's Common Stock pursuant to the third amendment and restatement of the Plan that increased the number of shares authorized for issuance under the Plan, as approved by the Company's stockholders at the Company's 2009 annual meeting of stockholders. A full-text copy of the Form S-8 is available for free at: http://is.gd/CHu54v About Commercial Vehicle Group New Albany, Ohio-based Commercial Vehicle Group, Inc., (Nasdaq: CVGI) supplies fully integrated system solutions for the global commercial vehicle market, including the heavy-duty truck market, the construction and agricultural markets, and the specialty and military transportation markets. The Company has facilities located in the United States in Arizona, Indiana, Illinois, Iowa, North Carolina, Ohio, Oregon, Tennessee, Virginia and Washington and outside of the United States in Australia, Belgium, China, Czech Republic, Mexico, Ukraine and the United Kingdom. The Company's balance sheet at June 30, 2011, showed $392.21 million in total assets, $387.09 million in total liabilities and $5.11 million in total stockholders' investment. * * * Commercial Vehicle carries a 'Caa2' Corporate Family Rating and 'Caa2/LD' Probability of Default Rating from Moody's. It has 'CCC+' issuer credit ratings from Standard & Poor's. In mid-October 2010, Moody's Investors Service upgraded Commercial Vehicle Group, Inc.'s Corporate Family Rating to Caa1 from Caa2, and revised the ratings outlook to positive from negative. These positive actions recognize the continuing improvement in the build rates for commercial vehicles and the realized benefits of the company's operating and capital restructurings. According to Moody's, the Caa1 CFR reflects modest size, high debt leverage, and exposure to highly cyclical commercial vehicle end markets. Demand for commercial vehicle components is sensitive to both economic cycles and regulatory implementation schedules. As reported by the TCR on April 12, 2011, Standard & Poor's Ratings Services said it raised its corporate credit rating on New Albany, Ohio-based Commercial Vehicle Group Inc. (CVG) to 'B-' from 'CCC+'. "The upgrade reflects our assumption that CVG can improve EBITDA and cash flow in the next two years, because we believe commercial truck production volumes will continue to rise year-over-year in 2011 and 2012," said Standard & Poor's credit analyst Nancy Messer. Heavy-duty truck production increased by a meaningful 30% in 2010, leading to a 30% year-over-year sales increase. CONGRESS SAND: Beveridge & Diamond Okayed as Environmental Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas authorized Congress Sand & Gravel, LLC, et al., to employ Laura L. LaValle and the Law Firm of Beveridge & Diamond, PC as special counsel. As reported in the Troubled Company Reporter on June 17, 2011, as special counsel, the firm is representing the Debtors concerning the Texas Commission on Environmental Quality regulation of environmental matters. The customary and proposed hourly rates to be charged by B&D for the individuals expected to be directly involved in representing the Debtor are: Ms. LaValle $441 Associates $250 - $380 Paralegals/Paraprofessionals $140 - $195 The Debtor will also reimburse B&D for its necessary out-of-pocket expenses. On Dec. 10, 2010, B&D received $2,500 as a retainer from Congress Sand. B&D may be owed some fees for services rendered immediately prior to the Petition Date that were not included in the B&D billing time system. The Debtors assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Congress Sand Bridgeport, Texas-based Congress Materials, LLC -- dba Green Aggregates and Union Materials, LP -- filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-37526) on Oct. 28, 2010. It estimated assets and debts at $10 million to $50 million. Kerens, Texas-based Congress Sand filed for Chapter 11 bankruptcy protection on Oct. 28, 2010 (Bankr. N.D. Tex. Case No. 10- 37522). It estimated its assets and debts at $1 million to $10 million. Congress Materials' bankruptcy case is jointly administered with Congress Sand & Gravel, LLC. Congress Sand is the lead case. Douglas S. Draper, Esq., at Heller Draper Hayden Patrick & Horn, LLC, assists Congress Sand and Congress Materials in their restructuring efforts. Affiliate Green Aggregates, Inc. (Bankr. N.D. Tex. Case No. 07- 53439) filed a separate Chapter 11 petition on Dec. 31, 2007. CRACKER BARREL: S&P Withdraws 'BB-' Corporate Credit Rating ----------------------------------------------------------- Standard & Poor's Ratings Services withdrew its 'BB-' corporate credit rating and 'BB-' issue ratings on Lebanon, Tenn.-based Cracker Barrel Old Country Store Inc. at the company's request. CRYSTAL CATHEDRAL: Taps Prudential Calif. as Condominium Broker --------------------------------------------------------------- Crystal Cathedral Ministries asks the U.S. Bankruptcy Court for the Central District of California for permission to employ Prudential California Realty as real estate broker to assist with the sale of certain residential real property located at 31423 Coast Highway, No. 33, Laguna Beach, California. The firm will assist the Debtor with identifying prospective buyers for the condominium and effectuating and consummating a sale of the condominium. The firm's compensation will include a percentage fee commission of 3% based a listing price of the condominium, if: a) a condominium is sold during the term of the listing agreement or any extension thereto to a purchaser procured by the firm, the Debtor, or any other party; b) within 180 days after the expiration of the term of the listing agreement and any extension thereto, unless otherwise agreed, the Debtor enters into a sales contract to sell, convey, lease or otherwise transfer the condominium to anyone or that person's related entity; and c) if, without the firm's prior written consent, the condominium is withdrawn from sale, conveyed, leased, rented, otherwise transferred, or made unmarketable by a voluntary act of the Debtor during the listing period or any extension thereto. If the condominium is not sold during the term of the listing agreement then the Debtor will have no obligation to pay the fee any fees and expenses. 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 Crystal Cathedral Crystal Cathedral Ministries is a Southern California-based megachurch founded by television evangelist Robert Schuller. The church, known for its television show "The Hour of Power." Mr. Schuller retired from his role as senior pastor of Crystal Cathedral in 2006. His daughter Sheila Schuller Coleman has been senior pastor since July 2009. Contributions declined 24 percent in 2009, in part on account of "unsettled leadership." Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. Marc J. Winthrop, Esq., at Winthrop Couchot P.C. represent the Debtor. Todd C. Ringstad, Esq., at Ringstad & Sanders, LLP, represents the Official Committee of Unsecured Creditors. CST INDUSTRIES: S&P Lowers Corporate Credit Rating to 'B' --------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Lenexa, Kan.-based CST Industries Inc. (CST) to 'B-' from 'B'. "At the same time, we lowered all of the company's issue-level ratings by one notch. The outlook is negative," S&P related. "The rating actions reflect our view that CST's thin margin of headroom under its financial covenants could trigger a financial covenant violation in the second half of 2011," said Standard & Poor's credit analyst Robyn Shapiro. "The negative outlook reflects the potential for a downgrade if CST is unable to negotiate adequate covenant relief. While the company successfully amended covenant levels most recently in November 2010, headroom currently remains very thin under financial covenants which are set to tighten in upcoming quarters. In addition, given the uncertain macroeconomic environment, it's unclear to us how soon CST's operating performance and credit metrics will improve. Finally, the company's $20 million revolving credit facility matures in December 2012 and its term loan, about $130 million outstanding, is due August 2013." The rating on CST reflects its highly leveraged financial risk profile and weak business risk profile as a participant in the fragmented and competitive metal storage tank market. "Given the uncertain macroeconomic environment, we believe domestic end market demand could remain weak over the next few quarters," S&P said. CST designs, fabricates, and erects factory-coated bolted and welded tanks and aluminum geodesic domes for a variety of end users, including the water, wastewater, industrial, agricultural, and oilfield markets. The industrial end markets are more cyclical than the water and wastewater markets. The industry is characterized by competing technologies and competition among numerous small players based on price, quality, and personal relationships. Although the company has leading niche-market shares, it participates in the larger overall metal storage market. A diverse customer base with low sales concentration slightly offsets the risks associated with CST's narrow scope of operations. CST's financial risk profile is highly leveraged. "We adjust debt for capitalization of operating leases and postretirement obligations," S&P related. "The outlook is negative, reflecting the potential for a downgrade if CST violates a covenant and cannot negotiate adequate covenant relief in a timely manner," Ms. Shapiro continued. "We could revise the outlook to stable if the company can negotiate covenant relief and maintain headroom under covenants consistent with our view of adequate liquidity, namely more than 15%." CYBEX INTERNATIONAL: Files Form 10-Q; Incurs $555,000 Loss in Q2 ---------------------------------------------------------------- Cybex International, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $555,000 on $32.56 million of net sales for the three months ended June 25, 2011, compared with a net loss of $356,000 on $27.67 million of net sales for the three months ended June 26, 2010. The Company also reported a net loss of $176,000 on $63.57 million of net sales for the six months ended June 25, 2011, compared with a net loss of $1.11 million on $53.78 million of net sales for the three months ended June 26, 2010. The Company's balance sheet at June 25, 2011, showed $83.93 million in total assets, $99.00 million in total liabilities and a $15.07 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/XZapKp About Cybex International Medway, Mass.-based Cybex International, Inc. (NASDAQ: CYBI) -- http://www.cybexintl.com/--is a manufacturer of exercise equipment and develops, manufactures and markets strength and cardiovascular fitness equipment products for the commercial and, to a lesser extent, consumer markets. The Company reported a net loss of $58.2 million on $123.0 million of sales for 2010, compared with a net loss of $2.4 million on $120.5 million of sales for 2009. KPMG LLP, in Pittsburgh, Pa., expressed substantial doubt about Cybex International's ability to continue as a going concern. The independent auditors noted that a December 2010 jury verdict in a product liability suit apportions a significant amount of liability to the Company. "The Company does not have the resources to satisfy a judgment in this matter that has not been substantially reduced from the jury verdict, which raises substantial doubt about the Company's ability to continue as a going concern." DAVID'S WESTMINSTER: Ch. 7 Trustee Says Business Could Reopen ------------------------------------------------------------- Peter Panepinto at Carroll County Times reports that the fate of David's Jewelers in Westminster, Maryland, is uncertain after an impending court case forced the business to close on July 29. The business filed for voluntary bankruptcy under chapter 11 reorganization July 11, but it was converted to a liquidation case July 29, County Times relates citing Zvi Guttman, a trustee who is overseeing the liquidation case on behalf of the court. Mr. Guttman said that since the business is under a liquidation case, it requires a court order to operate, according to County Times. Mr. Guttman, as cited by County Times, said there is a possibility the business could reopen in a different form, close or undergo a liquidation sale. David's Jewelers operates a jewelry store. David's Jewelers had been located on Main Street in Westminster, Maryland for more than 50 years. The store has 10 to 20 staff. David's Westminster, Inc., doing business as David's Jewelers and Hossler Jewelry, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D. Md. Case No. 11-24222) in Baltimore on July 11, 2011. The Debtor is represented by: Edward M. Miller, Esq. MILLER AND MILLER, LLP 202 E. Main St., 1st Floor Westminster, MD 21157 Tel: (410) 751-5444 Fax: (410) 751-6633 E-mail: mmllplawyers@verizon.net ELEPHANT & CASTLE: Can Hire Eckert Seamans as Bankruptcy Counsel ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts authorized Massachusetts Elephant & Castle Group and its affiliates to employ Eckert Seamans Cherin & Mellott, LLC as counsel under a general retainer. As reported in Troubled Company Reporter on July 20, 2011, John G. Loughnane, Esq., a member at the firm, will lead the engagement. The firm's hourly rates are: Paralegals $100 - $200 Associates $155 - $335 Members $220 - $580 Mr. Loughnane attested that Eckert Seamans is a "disinterested person" as that term is defined in Sec. 101(14) of the Bankruptcy Code, and represents or holds no interest adverse to the estates with respect to matters upon which the firm is to be employed. About Massachusetts Elephant & Castle Group Boston-based Massachusetts Elephant & Castle Group and its affiliates operates 21 British-style restaurant pubs in the U.S. and Canada. The chain, with 10 locations in the U.S., generated revenue of $47.5 million in 2010, throwing off $3.9 million of earnings before interest, taxes, depreciation, amortization, and foreign exchange gains or losses. Elephant & Castle filed for Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16155) on June 28, 2011. Bankruptcy Judge Henry J. Boroff presides over the case. John G. Loughnane, Esq. at Eckert Seamans Chein& Mellott, LLC represents the Debtor in its restructuring effort. Repechage Investments' estimated assets and debts at $10 million to $50 million. Other Debtors' estimated assets and debts at $0 to $10 million. On July 12, 2011, the U.S. Trustee's office appointed the Official Committee of Unsecured Creditors. ELEPHANT & CASTLE: Epiq Bankruptcy OK'd as Claims, Noticing Agent ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts authorized Massachusetts Elephant & Castle Group and its affiliates to employ Epiq Bankruptcy Solutions, LLC as claims, noticing and balloting agent. As reported in the Troubled Company Reporter on July 20, 2011, Jason D. Horwitz, Epiq vice president and senior consultant, attested that his firm does not (a) hold or represent an interest materially adverse to the Debtors' estates with respect to any matter for which it will be employed, or (b) have any materially adverse connection to the Debtors, their creditors or other relevant parties. Mr. Horwitz disclosed that on June 27, Epiq received a $25,000 retainer from the Debtors. About Massachusetts Elephant & Castle Group Boston-based Massachusetts Elephant & Castle Group and its affiliates operates 21 British-style restaurant pubs in the U.S. and Canada. The chain, with 10 locations in the U.S., generated revenue of $47.5 million in 2010, throwing off $3.9 million of earnings before interest, taxes, depreciation, amortization, and foreign exchange gains or losses. Elephant & Castle filed for Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16155) on June 28, 2011. Bankruptcy Judge Henry J. Boroff presides over the case. John G. Loughnane, Esq. at Eckert Seamans Chein& Mellott, LLC represents the Debtor in its restructuring effort. Repechage Investments' estimated assets and debts at $10 million to $50 million. Other Debtors' estimated assets and debts at $0 to $10 million. On July 12, 2011, the U.S. Trustee's office appointed the Official Committee of Unsecured Creditors. ELEPHANT & CASTLE: Taps BellMark Partners as Financial Advisor -------------------------------------------------------------- Massachusetts Elephant & Castle Group, Inc., et al., ask the U.S. Bankruptcy Court for the District of Massachusetts for permission to employ BellMark Partners, LLC as financial advisor. BellMark will perform consulting and financial advisory services that will be necessary during the chapter 11 case. BellMark's compensation will consist of: a) a transaction fee of the greater of 2% of the Transaction Value up to and including $25 million; plus 3% of each incremental dollar between $25 million and $30 million; plus 4% of each incremental dollar in excess of $30 million, subject to an overall minimum Transaction Fee of $350,000; b) BellMark will only earn a Transaction Fee on whatever final sales price is obtained and thereafter approved by the Court after a stalking-horse bid is subject to a bidding and auction process where other competitive bids are made, provided, however, that if no other competitive bids are made, then the Transaction Fee shall be based on the stalking-horse bid after it has been approved by the Court as the final purchaser; c) any Transaction Fee earned by BellMark will be held from the proceeds of any Transaction for the benefit of BellMark until the Court rules on BellMark's fee application. If such a withholding results in one or more secured creditors not being paid in full from the sale proceeds, such withholding will be deemed a carve out from the collateral of such secured creditor. In addition, the Debtors agreed to pay to BellMark a monthly set fee amount of $5,000, except that the Monthly Fee will be $10,000 for the first month starting from the commencement of these bankruptcy cases. To the best of the Debotors' knowledge, BellMark "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code. About Massachusetts Elephant & Castle Group Boston-based Massachusetts Elephant & Castle Group and its affiliates operates 21 British-style restaurant pubs in the U.S. and Canada. The chain, with 10 locations in the U.S., generated revenue of $47.5 million in 2010, throwing off $3.9 million of earnings before interest, taxes, depreciation, amortization, and foreign exchange gains or losses. Elephant & Castle filed for Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16155) on June 28, 2011. Bankruptcy Judge Henry J. Boroff presides over the case. John G. Loughnane, Esq. at Eckert Seamans Chein& Mellott, LLC represents the Debtor in its restructuring effort. Repechage Investments' estimated assets and debts at $10 million to $50 million. Other Debtors' estimated assets and debts at $0 to $10 million. On July 12, 2011, the U.S. Trustee's office appointed the Official Committee of Unsecured Creditors. ELEPHANT & CASTLE: Rose Group OK'd for Labor, Employment Matters ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts authorized Massachusetts Elephant & Castle Group and its affiliates, to employ The Rose Group, APLC, as special counsel. As reported in the Troubled Company Reporter on July 21, 2011, as counsel, Rose Group will render: (a) legal advice on labor and employment matters concerning the Debtors' operations in San Diego, California; and (b) legal advice and acting as the Debtors' Chief Negotiator in their current negotiations for a new collective bargaining agreement with UNITE HERE Local 30, AFL-CIO in San Diego, California. The Debtors will pay Rose Group $350 per hour for attorneys and $90 to $105 per hour for paralegals. The Debtors will also reimburse the firm for necessary out-of-pocket expenses. Kenneth J. Rose, Esq., at The Rose Group, APLC, assured the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors or their estates. Mr. Rose disclosed that as of the Petition Dates, the Debtors owe the Rose Group $2,625 for services rendered prepetition. The Rose Group also holds a $6,000 retainer from which it will satisfy the prepetition amounts. The Rose Group, he said, will hold in a client trust account the remainder of the retainer to cover postpetition services. About Massachusetts Elephant & Castle Group Boston-based Massachusetts Elephant & Castle Group and its affiliates operates 21 British-style restaurant pubs in the U.S. and Canada. The chain, with 10 locations in the U.S., generated revenue of $47.5 million in 2010, throwing off $3.9 million of earnings before interest, taxes, depreciation, amortization, and foreign exchange gains or losses. Elephant & Castle filed for Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16155) on June 28, 2011. Bankruptcy Judge Henry J. Boroff presides over the case. John G. Loughnane, Esq. at Eckert Seamans Chein& Mellott, LLC represents the Debtor in its restructuring effort. Repechage Investments' estimated assets and debts at $10 million to $50 million. Other Debtors' estimated assets and debts at $0 to $10 million. On July 12, 2011, the U.S. Trustee's office appointed the Official Committee of Unsecured Creditors. Goulston & Storrs, P.C. represents the Committee in the Debtors' cases. The Committee tapped FTI Consulting, Inc., as its financial advisors. ENDEAVOUR INTERNATIONAL: S&P Withdraws CCC+ Corp. Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its preliminary 'CCC+' corporate credit rating on Houston-based exploration and production company Endeavour International Corp. "We also withdrew the preliminary 'CCC' issue rating and preliminary '5' recovery rating on Endeavour's previously proposed $250 million senior unsecured notes. These withdrawals were done at the issuer's request. The company did not finalize the financing that was the basis for our assignment of preliminary ratings on June 8, 2011," S&P related. EOS PREFERRED: Buys $46-Mil. Residential Assets from Aurora Bank ---------------------------------------------------------------- EOS Preferred Corporation and Aurora Bank FSB finalized an Asset Sale Agreement pursuant to which the Company purchased certain residential mortgage backed securities assets from the Bank. The total purchase price was $46,763,679 plus accrued interest. The face amount of the assets as of closing was $47,156,379. The coupon interest rates as of closing ranged from 3.50% to 5.10%. The Agreement was executed following approval by the Company's Board of Directors by special meeting held on July 13, 2011. A full-text copy of the Asset Sale Agreement is available for free at http://is.gd/NLrqZd About EOS Preferred Based in New York, EOS Preferred Corporation (formerly Capital Crossing Preferred Corporation) is a Massachusetts corporation with the principal business objective to hold mortgage assets that will generate net income for distribution to stockholders. The Company was organized on March 20, 1998, to acquire and hold real estate assets and Aurora Bank FSB, an indirect wholly-owned subsidiary of Lehman Brothers Holdings Inc., owns all of the Company's common stock. Effective June 21, 2010, the Company changed its corporate name to EOS Preferred Corporation. The Company operates in a manner intended to allow its to be taxed as a real estate investment trust, or a "REIT," under the Internal Revenue Code of 1986, as amended. As a REIT, EOS will not be required to pay federal or state income tax if it distributes its earnings to its shareholders and continues to meet a number of other requirements. The Company reported net income of $7.65 million on $2.19 million of total interest income for the year ended Dec. 31, 2010, compared with a net loss of $12.82 million on $3.56 million of total interest income during the prior year. As reported by the TCR on April 6, 2011, Ernst & Young LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. On Sept. 15, 2008, Lehman Brothers Holdings Inc., indirect parent company to Aurora Bank FSB, and ultimate parent company of EOS Preferred Corporation, filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code. Aurora Bank, the sole owner of the common stock of EOS Preferred Corporation, is subject to a Cease and Desist Order, dated Jan. 26, 2009, and a Prompt Corrective Action Directive, dated Feb. 4, 2009, issued by the Office of Thrift Supervision, requiring Aurora Bank, among other matters, to submit a capital restoration plan and a liquidity management plan, and imposing restrictions on certain activities of Aurora Bank and EOS Preferred Corporation. According to the independent auditors, the bankruptcy of Lehman Brothers and the ability of the OTS to regulate and restrict the business and operations of EOS Preferred Corporation, in light of the Cease and Desist Order and the Prompt Corrective Action Directive, raise substantial doubt about EOS Preferred Corporation's ability to continue as a going concern. The Company's balance sheet at March 31, 2011, showed $87.21 million in total assets, $484,000 in total liabilities and $86.72 million in total stockholders' equity. EVANS OIL: Plan Filing Exclusivity Expires Aug. 12 -------------------------------------------------- The Hon. Barry S. Schermer of the U.S. Bankruptcy Court for the Middle District of Florida granted in part, denied in part, Evans Oil Company LLC, et al.'s request for exclusivity extensions. The Court has extended the Debtor's exclusive right to file and solicit acceptances for the proposed plan of reorganization until Aug. 12, 2011, and Oct. 12, respectively, without prejudice to the Debtors' rights to seek other or further extensions thereof and the rights of the U.S. Trustee and Fifth Third Bank with respect to the same. The U.S. Trustee and Fifth Third Bank each filed objections to Debtors' motion to extend exclusivity period. 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. There has been no committees formed in the Debtor's case at the present time. EVERGREEN PLAZA: Taps M. Jonathan Hayes as Gen. Bankruptcy Counsel ------------------------------------------------------------------ Evergreen Plaza Investment-DE, LLC, et al., ask the U.S. Bankruptcy Court for the Central District of California for permission to employ M. Jonathan Hayes as their general bankruptcy counsel. Hayes will, among other things: -- advise the Debtors regarding cash collateral matters with respect to the Debtors' real property; -- conduct examinations of witnesses, claimants, or adverse parties and to prepare and assist in the preparation and reports, accounts and pleadings; and -- advise concerning the requirements of the Bankruptcy Code and applicable rules. The hourly rates of the firm's professionals assigned to the cases are: M. Jonathan Hayes $385 Roksana Moradi, associate $235 Elizabeth Massaad, law clerk $95 Carolyn Afari, law clerk $65 Mr. Hayes received a prepetition retainer amounting to $50,000, plus the filing fee of $4,156, which was deposited into his client trust account. The source of the funds were the Debtors. The Debtors also seeks approval to allow Mr. Hayes to maintain single timekeeping records in the case of Evergreen Plaza Investment-DE LLC only. To the best of the Debtors' knowledge, Hayes is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Evergreen Plaza Evergreen Plaza Investment-DE, LLC; 15352 Vanowen Street Apartments-DE, LLC; Normandie Court III-DE, LLC; Westlake Evergreen-DE, LLC, jointly own, as Tenants-in-Common, 100% of real property located at 3637-3755 E. Thousand Oaks Blvd., Thousand Oaks, California. The percentage of ownership is: Evergreen (54.31%), Normandie (10.74%), Westlake (25%), and Vanowen (9.95%). The four entities jointly operate the Real Property pursuant to a Tenancy in Common Agreement executed between them on Oct. 28, 2004. The Real Property is a commercial complex of about 38 units with 21 units rented at this time. The Real Property is managed by Kaufman Properties, owned by Mark Kaufman, and JDS Real Estate, Inc. owned by Jason Schwetz. The leasing broker is JDS Real Estate, Inc. who is presently showing the spaces. The four entities filed for Chapter 11 bankruptcy on June 28, 2011, to stop a foreclosure sale by secured creditor LNR Partners. Evergreen Plaza Investment-DE (Bankr. C.D. Calif. Case No. 11- 17858); Westlake Evergreen-DE, LLC (Bankr. C.D. Calif. Case No. 11-17874); 15352 Vanowen Street Apartments-DE (Bankr. C.D. Calif. Case No. 11-17870); and Normandie Court III-DE (Bankr. C.D. Calif. Case No. 11-17872), estimated $10 million to $50 million in both assets and debts in their petitions. The law offices of M. Jonathan Hayes serve as the Debtors' counsel. The Debtors value the Real Property at roughly $13 million. Total secured debt exceeds $17 million. Each debtor-entity said its case is a single asset case. FAITH CHRISTIAN: Taps Lyons & Farrar as Counsel for BP Claim ------------------------------------------------------------ Faith Christian Family Church of Panama City Beach, Inc., on July 25, 2011, asked the U.S. Bankruptcy Court for the Northern District of Florida for permission to employ Marsha L. Lyons of the Law Offices of Lyons & Farrar, PA as counsel for BP claim. The firm will, among other things: -- prepare legal papers relating to trademark infringement; -- prepare pleadings and applications and to conduct examinations incidental to the administration of the Debtor's estate; and -- perform all other legal services for preservation of the Debtor's trademark and prevent infringement. To the best of Debtor's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Faith Christian Family Church Based in Panama City Beach, Florida, Faith Christian Family Church of Panama City Beach Inc., dba Faith Christian Family Church, filed for Chapter 11 bankruptcy protection on May 24, 2011 (Bankr. N.D. Fla. Case No. 11-50288). Charles M. Wynn Law Offices, P.A., represents the Debtor. The Debtor tapped James A. Judkins of the law firm of Judkins, Simpson, High & Schulte, as special counsel, and Marsha L. Lyons of the Law Offices of Lyons & Farrar, PA, as counsel for BP claim. The Debtor has $11,339,469 in assets, and $3,361,477 in debts. The Debtor has filed a plan of reorganization that calls for the sale of its parsonage to pay off its creditors. FAITH CHRISTIAN: Taps Judkins Simpson to Handle Marriage Action --------------------------------------------------------------- Faith Christian Family Church of Panama City Beach, Inc., asks the U.S. Bankruptcy Court for the Northern District of Florida for permission to employ James A. Judkins of the law firm of Judkins, Simpson, High & Schulte, as special counsel. The firm was retained prior to the filing of the bankruptcy case to represent the debtor-in-possession in a civil matter. The firm will represent the Debtor in the dissolution of marriage action between Markus Quin Bishop and Margie Negrin Bishop, in the Circuit Court of Bay County, Florida. To the best of the Debtor's knowledge, Mr. Judkins is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Faith Christian Family Church Based in Panama City Beach, Florida, Faith Christian Family Church of Panama City Beach Inc., dba Faith Christian Family Church, filed for Chapter 11 bankruptcy protection on May 24, 2011 (Bankr. N.D. Fla. Case No. 11-50288). Charles M. Wynn Law Offices, P.A., represents the Debtor. The Debtor tapped James A. Judkins of the law firm of Judkins, Simpson, High & Schulte, as special counsel, and Marsha L. Lyons of the Law Offices of Lyons & Farrar, PA, as counsel for BP claim. The Debtor has $11,339,469 in assets, and $3,361,477 in debts. The Debtor has filed a plan of reorganization that calls for the sale of its parsonage to pay off its creditors. FAITH CHRISTIAN: Meeting of Creditors Resumes Tomorrow ------------------------------------------------------ The U.S. Trustee for Region 21 has continued until Aug. 10, 2011, at 8:45 a.m., Eastern Time, the meeting of creditors in the Chapter 11 case of Faith Christian Family Church of Panama City Beach, Inc. The hearing will be held at 110 East Park Avenue, Tallahasse, Florida, Room 004. Based in Panama City Beach, Florida, Faith Christian Family Church of Panama City Beach Inc., dba Faith Christian Family Church, filed for Chapter 11 bankruptcy protection on May 24, 2011 (Bankr. N.D. Fla. Case No. 11-50288). Charles M. Wynn Law Offices, P.A., represents the Debtor. The Debtor has $11,339,469 in assets, and $3,361,477 in debts. The Debtor has filed a plan of reorganization that calls for the sale of its parsonage to pay off its creditors. FAITH CHRISTIAN: Plan Disclosures Hearing Tomorrow -------------------------------------------------- Faith Christian Family Church of Panama City Beach, Inc., will seek approval Aug. 10, 2011, at 10:00 a.m., of the disclosure statement explaining its proposed plan of reorganization. According to the First Amended Disclosure Statement, filed on July 5, 2011, the Debtor will fund the Plan from general operations of the ministry. The ministry has also listed the parsonage for sale at a price of $4.2 million. Should the parsonage sell prior to confirmation, the Debtor will be able to pay Suntrust and all creditors in full, except for Margie Negrin Bishop (Class 14) whose claim is disputed. The secured claim of Suntrust Bank, owed $2,924,127 plus accrued interest, will be satisfied from the surrender of real property. The Debtor is proposing three options, each of which consists of the surrender of real property in full satisfaction of the debt. Allowed unsecured claims of less than $1,200 will be paid in full at no interest upon the effective date of confirmation. General unsecured claim of Suntrust for a Visa card in the approximate amount of $15,309 will be paid in full at 6% simple interest over 60 months. Equity interest holders will retain their positions as members of the not for profit corporation. A copy of the First Amended Disclosure Statement is available at: http://bankrupt.com/misc/faithchristian.1stamendedDS.pdf Based in Panama City Beach, Florida, Faith Christian Family Church of Panama City Beach Inc., dba Faith Christian Family Church, is a not for profit corporation. The church filed for Chapter 11 bankruptcy protection (Bankr. N.D. Fla. Case No. 11-50288) on May 24, 2011. The Debtor disclosed $11,339,469 in assets, and $3,361,477 in debts as of the Chapter 11 filing. Charles M. Wynn, Esq., at Charles M. Wynn Law Offices, P.A., serves as the Debtor's bankruptcy counsel. FENTON SUB: Court OK's Fredrikson & Byron as Bankruptcy Counsel --------------------------------------------------------------- The Hon. Robert J. Kressel of the U.S. Bankruptcy Court for the District of Minnesota authorized Fenton Sub Parcel D, LLC, and Bowles Sub Parcel D, LLC, to employ Fredrikson & Byron, P.A., as counsel. As reported in the Troubled Company Reporter on July 18, 2011, the Debtors provided a combined retainer of $35,000 for the services to be rendered and fees incurred prior to the case, and during the chapter 11 case. The two filing fees of $1,039 each will be paid by the Debtors pursuant to Fredrikson & Byron's first fee application. James L. Baillie, Esq., a shareholder at the firm, attested that the firm does not (a) represent any entity in connection with the case, (b) does not hold or represent any interest adverse to the estates, and (c) are disinterested under Sec. 327 of the Bankruptcy Code. Fredrikson & Byron represents Carlson Real Estate Company, and an affiliate of Carlson Real Estate Company is an investor in an LLC that owns less than 20% of an LLC that holds the membership interest in the Debtors. Carlson Real Estate Company has given Fredrikson & Byron a waiver with respect to Fredrikson & Byron's representation of the Debtors. A shareholder of Fredrikson & Byron is the representative for a trust that is an investor in an LLC that owns less than 20% of an LLC that holds the membership interest in the Debtors. The shareholder, on behalf of the trust, has given Fredrikson & Byron a waiver with respect to Fredrikson & Byron's representation of the Debtors. About Fenton Sub Parcel D and Bowles Sub Parcel D Fenton Sub Parcel D LLC and Bowles Sub Parcel D LLC jointly own industrial multi-tenant properties located in the Twin Cities. They are controlled by StoneArch II/WCSE Minneapolis Industrial LLC. StoneArch is the 100% member of Bowles Subsidiary, LLC and of Fenton Subsidiary LLC. Bowles Subsidiary LLC is then the 100% member of Bowles Sub Parcel D LLC, and Fenton Subsidiary LLC is the 100% member of Fenton Sub Parcel D, LLC. In 2007, StoneArch acquired various LLCs, which in turn owned 27 industrial multi-tenant properties located in the Twin Cities. The properties were divided into four separate pools: A, B, C, and D. Fenton Sub Parcel D and Bowles Sub Parcel D jointly own the properties in pool D. As tenants in common, Fenton Sub Parcel D has an undivided 74.5394% interest and Bowles Sub Parcel D has an undivided 25.4606% interest. The Pool D Properties consist of six parcels of real property located in Anoka, Dakota, and Hennepin Counties, Minnesota. The Debtors expect the Pool D Properties to be worth $13,135,656 as of the Petition Date. Although they are two separate legal entities, Fenton Sub Parcel D and Bowles Sub Parcel D have consistently been treated as one enterprise. Hoyt Properties, Inc., acts as agent in managing the Pool D Properties. Fenton Sub Parcel D and Bowles Sub Parcel D filed for Chapter 11 bankruptcy (Bankr. D. Minn. Case Nos. 11-44430 and 11-44434) on June 29, 2011. The Debtors' petitions were signed by Steven Bruce Hoyt, chief manager, who is a debtor in bankruptcy case number 11- 43816. He is separately represented by Michael C. Meyer of the firm Ravich Meyer. The cases were originally assigned to Judge Dennis D. O'Brien and reassigned to Judge Robert J. Kressel as the cases are related to the Hoyt case, which was filed earlier and assigned to Judge Kressel. FISHER COMMS: Moody's Upgrades Corporate Family Rating to 'B1' -------------------------------------------------------------- Moody's Investors Service upgraded Fisher Communication Inc.'s Corporate Family Rating (CFR) to B1 from B2 and Probability of Default Rating (PDR) to B1 from B2. Moody's also upgraded the company's Senior Unsecured Notes due 2014 to B1, LGD 4 -- 52% from B2, LGD 4 -- 51%. The upgrade is due to the company's success in improving EBITDA margins combined with meaningful debt reduction leading to expected good free cash flow generation over the rating horizon. The Speculative Grade Liquidity Rating is unchanged at SGL-2. The rating outlook is stable. Upgrades: Issuer: Fisher Communications, Inc. -- Corporate Family Rating: Upgraded to B1 from B2 -- Probability of Default Rating: Upgraded to B1 from B2 -- Senior Unsecured Notes due 2014: Upgraded to B1, LGD 4 -- 52% from B2, LGD 4 -- 51% Unchanged: Issuer: Fisher Communications, Inc. -- Speculative Grade Liquidity Rating: Affirmed SGL-2 Outlook Action: Issuer: Fisher Communications, Inc. -- Outlook is stable RATINGS RATIONALE Fisher's B1 Corporate Family Rating reflects Moody's expectation that management will achieve targets Moody's established for an upgrade including the reduction in absolute debt balances to approximately $50 million and increasing EBITDA margins to greater than 25%. Improved margins combined with meaningful debt reduction resulted in 2.1x debt-to-EBITDA ratios estimated for LTM June 30, 2011 (including Moody's standard adjustments) compared to 7.3x for the same period in the prior year. Since 2009 management has been repurchasing senior notes consistent with its strategy to reduce debt. Over the same period, consolidated EBITDA margins have improved to more than 20% for LTM June 2011 (including Moody's standard adjustments) compared to 7.5% for FY2009 reflecting management's focus on personnel costs as well as benefits from shared services and automation. Having entered into an agreement to divest remaining small market radio stations, Moody's expects EBITDA margins to improve further; however, overall margins will continue to be constrained by Fisher's lack of national scale and fewer broadcast properties over which operators allocate fixed costs including corporate overhead. Ratings are supported by Fisher's diverse television network affiliations and good liquidity. Looking forward, management states that it intends to keep debt-to-EBITDA ratios below 4.50x -- 4.25x. Given leverage is currently below this range, ratings incorporate the potential for an acceptable level of debt financed acquisitions or shareholder distributions. Moody's is aware of management's focus to enhance shareholder returns and ratings incorporate the potential for excess cash to be used to fund acquisitions or provide for share repurchases and dividends. The stable outlook reflects Moody's expectation that debt-to- EBITDA ratios (including Moody's standard adjustments) will remain below 4.25x and that Fisher will maintain good liquidity. The outlook incorporates the potential for dividends and share repurchases funded by excess cash or a portion of free cash flow. Ratings could be downgraded if debt-to-EBITDA ratios exceed 4.5x (including Moody's standard adjustments) or if free cash flow-to- debt ratios were to fall below 8% - 10% due to deterioration in EBITDA margins, increased capital spending, share repurchases, or dividends. Excluding a scenario under which the company makes an accretive acquisition, higher debt levels or a decline in cash balances could also result in a downgrade. Lack of national scale and geographic concentration in the northwest constrain ratings; however, Moody's would consider an upgrade if management demonstrates commitment to execute its business plan while balancing creditor and shareholder interests evidenced by maintaining a conservative balance sheet that would be consistent with a higher rating, strong liquidity, and a minimum 12% free cash flow-to-debt ratios. Recent Events The company continues to explore strategic alternatives for Fisher Plaza including a sale or mortgaging of the asset. A recent appraisal valued the facility at $142 million, 34% above the $106 million book value as of December 2010. Last month, Fisher entered into an agreement to sell 6 radio stations in Montana for $1.8 million, thereby completing the disposition of all of its smaller market radio stations. During the company's 2Q11 earnings call, management disclosed that it repurchased additional senior notes through July 2011 reducing outstandings to $69.3 million from $101.4 million at December 2010; Moody's estimates the company's debt-to-EBITDA ratio to be approximately 2.2x (including Moody's standard adjustments) factoring in these repurchases. Leading up to the annual shareholders meeting in May 2011, FrontFour Capital (representing dissident shareholders) sought to gain a majority of board representation, but was able to win only two seats, bringing its total to three of the total nine board seats, leaving six directors who are supportive of existing management's growth strategy. Costs related to the proxy contest were reported to be $1.6 million in the first half of 2011. The principal methodology used in rating Fisher Communications was the Global Broadcast Industry Methodology published in June 2008. Founded in 1910, Fisher Communications, Inc. operates 13 high power plus 7 lower power television stations with diverse network affiliations including ABC (2 affiliates), CBS (9), Fox (1), and Univision (6) in the northwestern US. The company also operates 3 radio stations in Seattle, as well as Fisher Plaza, a mixed use facility near downtown Seattle. Fisher is publicly traded and shareholders with more than 5% of outstanding shares as of March 2011, include GAMCO Asset Management (approximately 28%), TowerView (10%) and George D. Fisher (5%). The company is headquartered in Seattle, WA and revenues for the LTM ended June 30, 2011 totaled $178 million. GENERAL MOTORS: Old GM Still Holding $2.36 Billion in New GM Stock ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the old General Motors Corp. creditor's trust reported it's still holding $2.36 billion in market value of common stock and warrants in new GM, formally named General Motors Co. The securities are being held back pending final resolution of $7.04 billion in disputed claims. Through the end of June, $29.84 billion in unsecured claims had been resolved. The creditors' committee is also objecting to the validity of a claim by the U.S. Treasury Department to the proceeds should the committee succeed in its lawsuit to void the security interest on a $1.5 billion term loan. Mr. Rochelle recounts that old GM, now formally named Motors Liquidation Co., implemented its Chapter 11 plan in March and made a first distribution in April of some of the stock and warrants it received from new GM. There have been additional distributions since then. GM's was the largest manufacturing reorganization in history. The plan created four trusts. One distributes the stock and warrants issued by new GM as consideration for the sale of the assets. Creditors of old GM split up 10% of the stock of new GM and warrants for 15%. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company (NYSE:GM, TSX: GMM) -- http://www.gm.com/-- is one of the world's largest automakers, traces its roots back to 1908. GM employs 208,000 people in every major region of the world and does business in more than 120 countries. GM and its strategic partners produce cars and trucks in 30 countries, and sell and service these vehicles through the following brands: Baojun, Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Isuzu, Jiefang, Opel, Vauxhall, and Wuling. GM's largest national market is China, followed by the United States, Brazil, the United Kingdom, Germany, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. was formed to acquire the operations of General Motors Corp. through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The U.S. government once owned as much as 60.8% stake in New GM on account of the financing it provided to the bankrupt entity. The deal was closed July 10, 2009, and Old GM changed its name to Motors Liquidation Co. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. GENTIVA HEALTH: Moody's Reviews Ba3 Corporate for Downgrade ----------------------------------------------------------- Moody's Investors Service placed Gentiva's ratings, including the Ba3 corporate family and probability of default ratings, under review for downgrade due to a confluence of negative factors affecting the home health sector, including an announcement in July 2011 which proposes to increase reimbursement rate cuts alongside volume losses associated with new legislation requiring "face-to-face" physician assessments. Moreover, Moody's is concerned about future pressure associated with the debt ceiling compromise which includes requirements for reduction in Medicare spending. Notably, Medicare comprises about 83% of Gentiva's revenues. In addition, Moody's lowered Gentiva's Speculative Grade Liquidity rating to SGL-2 from SGL-1 primarily as a result of the likelihood that the company's flexibility under its credit agreement covenants will diminish by 2012. The following ratings are under review for downgrade: Corporate Family Rating at Ba3; Probability of Default Rating at Ba3; $125 million senior secured revolver due 2015 at Ba2 (LGD3, 34%); $200 million senior secured term loan A due 2015 at Ba2 (LGD3, 34%); $600 million senior secured term loan B due 2016 at Ba2 (LGD3, 34%); $325 million unsecured notes due 2018 at B2 (LGD5, 88%); This rating was downgraded: Speculative Grade Liquidity rating to SGL-2 from SGL-1. RATINGS RATIONALE Moody's currently believes that the rating review is reasonably likely to result in a downgrade of at least one notch, and expects to conclude the review process shortly. The review will focus on the impact of lower EBITDA on the company's debt-to-EBITDA leverage, the decline in free cash flow and bank credit agreement covenant compliance. Moody's will also consider the potential for Gentiva to deploy restructuring initiatives and discussions with CMS (Centers for Medicare & Medicaid Services) that could mitigate some of the rate pressure. Moody's notes that Gentiva's hospice segment should modestly offset the depth of the home health rate cuts and the company benefits from approximately $100 million in balance sheet cash. Gentiva Health Services, Inc. is a leading provider of home health and hospice services in the US. The company offers direct home nursing and therapies, including specialty programs, as well as hospice care with over 450 locations in 42 states. Gentiva reported revenues of over $1.7 billion for the twelve months ended June 30, 2011. Gentiva's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Gentiva's core industry and believes Gentiva's ratings are comparable to those of other issuers with similar credit risk. GIORDANO'S ENTERPRISES: Ousted Owner Mulls Bid, Raising $70MM ------------------------------------------------------------- Katy Stech, writing for Dow Jones' Daily Bankruptcy Review, reports that John Apostolou, the ousted owner of the Giordano's pizza chain, is putting together a bankruptcy auction bid that would enable him to recapture the iconic Chicago restaurant company once again. According to DBR, Zane Smith, Esq., an attorney for Mr. Apostolou, said late Friday that he and his family members are negotiating with lenders to raise more than $70 million that they'd use to bid on Giordano's Enterprises Inc., which is expected to be auctioned off by the end of the year. Ms. Smith said the group's proposal could be the auction's so-called stalking-horse bid, which would set the floor price for the event and is typically meant to rally bids from outsiders. That first bid, along with the entire auction process, would need approval from a bankruptcy judge. DBR relates that in an e-mail Friday, Giordano's Chapter 11 Trustee Philip Martino said he's received "no offer" from Mr. Apostolou. "Since my appointment, such an offer has been imminent," Mr. Martino said. "If he makes an offer, it will be evaluated with all others to identify what is best for the bankruptcy estates." DBR further relates Mr. Apostolou hired Ms. Smith, a personal- injury lawyer, to bring a lawsuit against a former Giordano's executive, the chain's main lender Fifth Third Bank and a handful of franchisees, alleging that they ganged up on him to deprive him of control over the restaurant chain. The lawsuit, filed Wednesday in Cook County Circuit Court, claims that Mr. Apostolou and his wife, Eva, are owed more than $120 million in damages for the conspiracy launched against him by the groups -- all while Mr. Apostolou was recovering from a heart attack he suffered days after he defaulted on his loan payment last summer. According to DBR, the accusations against the franchisees echo a lawsuit that the Chapter 11 Trustee Martino recently filed, which says the franchisees were conspiring to block the company's sale to outside buyers. In June 2011, the Apostolous and Marshall E. Home filed a 20-page motion, including attachments, in the Giordano's case seeking dismissal for lack of subject matter jurisdiction. About Giordano's Enterprises Chicago, Illinois-based Giordano's Enterprises, Inc., was founded in 1974 in Chicago, Illinois, by two Argentinean immigrants, Efren and Joseph Boglio. In 1988, John and Eva Apostolou purchased control of Giordano's. Although this casual dining eatery offers a broad array of fine Italian cuisine, it is primarily know for its "Chicago's World Famous Stuffed Pizza". At present, Giordano's operates six company owned stores in Chicagoland, four joint venture stores, and thirty-five franchisee locations. In addition, Giordano's operates Americana Foods, Inc., located in Mount Prospect, Illinois, that serves as the commissary for the majority of food products purchased by the Illinois locations. An affiliated real estate holding company, Randolph Partners, LP, owns 12 restaurant buildings that are leased to four of the company-owned locations, two of the joint venture locations and six of the franchisee locations. The other 33 locations are leased from third party landlords; two for the Giordano's locations, two for the joint venture locations and 29 for the franchise locations. Giordano's is the lessee and subleases the restaurant facility for 22 of the 29 franchise third party leases. JBA Equipment Finance, Inc, another affiliated entity, leases restaurant equipment packages to eight franchisee locations. Giordano's Enterprises and 26 affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Lead Case No. 11-06098) on Feb. 16, 2011. Six additional affiliates filed for Chapter 11 protection on Feb. 17, 2011. Michael L. Gesas, Esq., David A. Golin, Esq., Miriam R. Stein, Esq., and Kevin H. Morse, at Arnstein & Lehr, LLP, in Chicago, serve as the Debtors' bankruptcy counsel. Giordano's Enterprises disclosed $59,387 in assets and $45,538,574 in liabilities as of the Chapter 11 filing. Certain of the Debtors owe Fifth Third Bank not than $13,560,662, pursuant to loans and financial accommodations, and $31,927,998 under a business loan as of the Petition Date. Fifth Third has agreed to provide DIP financing of up to $35,983,563 to the Debtors. Philip V. Martino has been appointed as Chapter 11 trustee in the Debtors' bankruptcy cases, at the behest of the U.S. Trustee. Mr. Martino filed a $3,000,000 bond. HANLEY WOOD: Likely to Restructure Due to Cash Woes, Says Moody's ----------------------------------------------------------------- Moody's Investors Service has changed the corporate family rating (CFR) for Hanley-Wood, LLC to Ca from Caa1 prior. The downgrade reflects the company's strained liquidity and high leverage. The outlook remains negative. Moody's has taken the following rating actions: Issuer: Hanley Wood, LLC -- Corporate Family Rating, downgraded to Ca from Caa1 -- Probability of Default Rating, downgraded to Ca from Caa1 -- Outlook, unchanged at Negative -- Senior Secured Term Loan due March 2014, Downgraded to Ca, LGD 4-51% from Caa1, LGD 4-50% -- Senior Secured Revolving Credit Facility due March 2013, Downgraded to Ca, LGD 4-51% from Caa1, LGD 4-50% RATINGS RATIONALE Hanley Wood's rating reflects its strained liquidity and high leverage of approximately 20x debt to last-twelve-months EBITDA (Moody's Adjusted). Moody's feels that a restructuring is very likely since the current business cannot support the existing debt load which was set near the peak of the housing bubble. Hanley- Wood's revenues appear to have stabilized and management has aggressively shed costs. However, given the likelihood of a slow, grinding recovery of the U.S. housing market, Moody's believes that Hanley-Wood will need to significantly reduce debt to reach a sustainable capital structure. The company is highly cyclical due to its exposure to the residential and commercial construction sectors. Protracted duress within these industries has prevented Hanley-Wood from recovering following the recession. Within the company's exhibition business, which represents one-third of the company's revenues but approximately three-fourths of its EBITDA, sales have fallen by one-third from the pre-recession peak. Additionally, Hanley-Wood's print advertising revenues face continued pressure from electronic substitution. Hanley-Wood's revenues, while recently stabilized, have fallen below the level at which the company can cover its fixed costs and it continues to consume cash. The company has met near-term obligations by borrowing against accounts receivables and is likely to trip the maximum leverage covenant which governs its revolving credit facility, when it steps down to 7.5x on January 1, 2012. Although the company's equity sponsor can cure this breach by repaying any outstanding revolver borrowings ($6.5 million as of 3/31/11), the ongoing liquidity crunch is unlikely to abate. Hanley-Wood's credit facility is secured by a first priority lien on substantially all of the assets of Hanley-Wood, LLC and its domestic operating subsidiaries. Moody's rates the senior secured credit facility Ca, in line with the CFR as it represents the majority of the company's debt capital. Moody's could lower Hanley-Wood's ratings if the company's liquidity position becomes further strained and the company is unable to find alternative financing sources to meet its cash needs. Hanley Wood's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Hanley Wood's core industry and believes Hanley Wood's ratings are comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009 (and/or) the Government-Related Issuers methodology published in July 2010. Headquartered in Washington, DC, Hanley-Wood is a leading business-to-business media company serving customers in the residential housing and commercial construction end markets. Revenues for the twelve month period ended March 31, 2011 were approximately $130 million. HOMELAND SECURITY: Acquires All Outstanding Timios Capital Stock ---------------------------------------------------------------- Homeland Security Capital Corporation added a second acquisition as part of its entry into the mortgage and settlement services industry by completing the acquisition of all of the stock of Timios, Inc. The acquisition of Timios, Inc., a technologically advanced, paperless provider of title insurance and escrow services, adds additional core services to Fiducia Real Estate Solutions, Inc. (Fiducia), a recently formed subsidiary under HOMS. Timios is a licensed title insurance and escrow agent operating in approximately 40 States offering comprehensive title and escrow services for mortgage origination refinance, reverse mortgage, real estate owned and deed-in-lieu transactions, listing some of the largest lenders and servicers nationwide as clients. Timios is headquartered in Westlake Village, California, and has offices in Plano, Texas, as well as satellite offices in four other states. The initial purchase price is $1,150,000, subject to working capital adjustments, plus contingency payments of up to $1,350,000 payable over the next 12 months. C. Thomas McMillen, HOMS Chairman and CEO, stated, "Completion of this transaction and the Default Servicing transaction we previously announced represent a big step forward in immediately expanding our presence nationwide in this new line of business." McMillen continued, "The extensive experience of both management teams increases our ability to reach new customers and provide current customers with enhanced default and title products and services." Trevor Stoffer, the CEO of Timios, Inc., went on to say, "Timios has come a long way in a short period of time. Our growth in volume and new clients through difficult times is a testament to what we believe to be our high level of service and great partnerships. Our new partnership with Homeland Security will allow us to extend our service to more clients, expand our product offerings, and drive increasing value to our customers and investors." HOMS consolidates the results of subsidiaries Safety & Ecology Holdings Corporation, Nexus Technologies Group, Inc., and Polimatrix, Inc., and will also consolidate the results of Fiducia. The Company will continue to measure its operating performance against plan taking into consideration EBITDA adjustments and one time charges. In addition, effective July 29, 2011, in exchange for the payment of the consideration for the acquisitions of Timios and Default Servicing, Inc., the Company received Class A membership interests in Fiducia Holdings LLC. In addition, C. Thomas McMillen, the Chief Executive Officer and Chairman of the Company, and Michael T. Brigante, the Chief Financial Officer of the Company, in exchange for certain consideration, received Class B membership interests in Fiducia Holdings, which entitles them to a 20% carry and a pro rata participation in any distributions made by Fiducia Holdings after the repayment of all capital contributions plus dividends and any loans plus interest to the Company as a Class A member. On the same day, Fiducia Holdings, along with six other investors who are members of Timios' management, invested in the shares of common stock, par value $0.001 per share, and Series A Preferred Stock, par value $0.001 per share, of Fiducia Real Estate Holdings, Inc. Fiducia Real Estate is now 80% owned by the Company, through its Class A membership interests in Fiducia Holdings, and 20% owned by the Minority Stockholders. Fiducia Real Estate, in turn, now owns 100% of the capital stock of each of Timios Acquisition and Default Servicing USA, Inc. The terms of the Series A Preferred are set forth in the Certificate of Designation, Preferences and Rights of the Series A Preferred, dated as of July 29, 2011, a copy of which is available for free at http://is.gd/VPSUeM As part of this restructuring, the Company also entered into a services agreement with each of Timios Acquisition and Default, pursuant to which it will receive $25,000 per month for providing the services set forth in the Services Agreement, as well as a tax sharing agreement, which agreement sets forth, among other things, the terms pursuant to which the Company and each of Timios Acquisition and Default will utilize the tax attributes of the Company to offset certain liabilities of the combined group of companies and to strengthen such subsidiary's balance sheet during the period which the Company may consolidate its tax return with such subsidiaries. A copy of each of the forms of the Services Agreement and the Tax Sharing Agreement are available for free at: http://is.gd/dd4hwz http://is.gd/2s5iQ0 About Homeland Security Homeland Security Capital Corporation is an international provider of specialized technology-based radiological, nuclear, environmental disaster relief and electronic security solutions to government and commercial customers. At December 31, 2009, the Company had total assets of $35,815,519 against total liabilities of $38,018,448 and Warrants Payable -- Series H Preferred Stock of $169,768. Stockholders' deficit was $2,372,697 at December 31, 2009. In March 2008, the Company entered into a stock purchase agreement with YA Global Investments, L.P. pursuant to which the Company sold to YA 10,000 shares of its Series H Convertible Preferred Stock. The Series H Stock is convertible into shares of Common Stock at an initial ratio of 33,333 shares of Common Stock for each share of Series H Stock, subject to adjustments -- including the Company's wholly owned subsidiary, Safety & Ecology Holdings Corporation, achieving certain earnings milestones, as defined, for the calendar years ending December 31, 2009 and 2008. Safety operates its business on a fiscal year ending June 30. Safety achieved the first milestone for the calendar year ending December 31, 2008. However, the second financial milestone for the calendar year ended December 31, 2009, has not been satisfied, resulting in a potential adjustment to the conversion ratio yielding approximately 56,300 shares of Common Stock for each share of Series H Stock, or approximately a potential additional 230,000,000 shares of the Company's Common Stock in the aggregate. Management is discussing with YA the possibility of a waiver or amendment of any adjustment to the Series H Stock conversion ratio, however there can be no assurances YA will waive or amend the adjustment, if any, to the Series H Stock conversion ratio. YA has not exercised its conversion rights as of February 22, 2010. In June 2009 the Company entered into an agreement YA extending the due date on its senior notes payable, and accrued interest, to YA from March 14, 2010, until October 1, 2010, for $2,500,000 and April 1, 2011, for $10,560,000. In exchange, the Company agreed to an increase in the interest rate, from 13% to 15%, on the senior notes payable and certain other debt due to YA, effective January 1, 2010, if the Company failed to secure a certain contract by March 2010. In December 2009, the Company was informed that it had been eliminated from the award process for this contract. Accordingly, the Company will begin recording interest expense at the increased rate effective Jan. 1, 2010. HOTEL AIRPORT: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Hotel Airport Inc. P.O. Box 38087 San Juan, PR 00937 Bankruptcy Case No.: 11-06620 Chapter 11 Petition Date: August 5, 2011 Court: U.S. Bankruptcy Court District of Puerto Rico (Old San Juan) Debtor's Counsel: Edgardo Munoz, Esq. EDGARDO MUNOZ, PSC P.O. Box 360971 San Juan, PR 00936-0971 Tel: (787) 524-3888 Fax: (787) 524-3888 E-mail: emunoz@emunoz.net Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by David Tirri, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Firstbank Puerto Rico -- $5,068,333 P.O. Box 9146 San Juan, PR 00908-0146 Autoridad De Los Puertos -- $355,537 P.O. Box 37042 San Juan, PR 00937-0042 PR Tourism Co. -- $24,669 Apartado Postal 9023960 San Juan, PR 00902-3960 American Airlines -- $18,000 Tropigas -- $11,881 BJ Bistro -- $9,145 American Hotel Register -- $7,386 Progressive -- $7,315 Golden Whipp -- $6,066 Provisiones Legrand -- $6,063 Viva Carpets -- $3,430 Centennial P.R -- $2,867 PRTC -- $2,820 NPR Solutions -- $2,705 Tischer & Co Inc. -- $2,133 Gasco Industrial -- $1,479 D'Erick Exterminating -- $1,200 Kevane Grant Thornton -- $1,185 Schindler Elevator Corp. -- $1,183 Total Services -- $1,456 HOWREY LLP: Bills to Bankr. Advisors Start to Pile Up ----------------------------------------------------- Sara Randazzo at The Am Law Daily reports that covering the period from June 7 -- when Howrey converted its bankruptcy from an involuntary Chapter 7 filing to voluntary Chapter 11 -- through the end of the month, the court records show the defunct firm's financial adviser Proviti Inc. submitted the largest bill, for about $393,000. According to the report, bankruptcy counsel Wiley Rein, meanwhile, submitted a fee and expense report totaling about $264,000. Wiley's top billing partner on the matter is H. Jason Gold, resident in the Washington, D.C., office. Gold has put in more than 100 hours at a rate of $730 per hour, according to the filing. Other Wiley partners working on the case included Valerie Morrison -- roughly 85 hours at $660 per hour -- and Dylan Trache -- 129 hours at $535 per hour -- both in the Washington office. The report says Felderstein Fitzgerald Willoughby & Pascuzzi, a bankruptcy boutique in Sacramento, California, that serves as counsel to the official committee of unsecured Howrey creditors, submitted a bill for roughly $49,000 in fees. Name partner Thomas Willoughby did most of the firm's work on the matter, billing 73 hours at $475 per hour. Willoughby, who performed the same function in the bankruptcy of Heller Ehrman, was chosen as the committee's attorney in mid-June. The Am Law Daily says the unsecured creditors committee filed a request asking the court to approve the hiring of financial consultant Development Specialists Inc. at a blended rate of $310 per hour to analyze Howrey's finances and advise on a liquidation plan. DSI previously advised on the financial unwinding of other bankrupt law firms including Heller and Coudert Brothers. The Am Law Daily notes while Howrey and its creditors work toward finalizing a dissolution plan, the firm is also battling with its Washington, D.C., landlord over unpaid rent that could cost the firm $7.7 million and with its medical insurance provider over more than 4,000 unpaid claims from former employees. The firm detailed its own monthly expenses for June last week and still hopes to move the bankruptcy proceedings to a Washington, D.C.-area jurisdiction, though that issue is on hold until a preliminary liquidation plan is arranged in the next two months, notes The Am Law Daily. About Howrey LLP Three creditors filed an involuntary Chapter 7 petition (Bankr. N.D. Calif. Case No. 11-31376) on April 11, 2011, against the remnants of the Washington-based law firm Howrey LLP. The filing was in San Francisco, where the firm had an office. The firm previously was known as Howrey & Simon and Howrey Simon Arnold & White LLP. The firm at one time had more than 700 lawyers in 17 offices. The partners voted to dissolve in March. The firm specialized in antitrust and intellectual-property matters. The three creditors filing the involuntary petition together have $36,600 in claims, according to their petition. The involuntary chapter 7 petition was converted to a chapter 11 case in June at the request of the firm. In its schedules filed in July, the Debtor disclosed assets of $138.7 million and liabilities of $107.0 million. HOWREY LLP: To Hire Duane Morris as Special Counsel --------------------------------------------------- Dow Jones' DBR Small Cap reports that the Howrey LLP seeks permission from the U.S. Bankruptcy Court in San Francisco to employ Duane Morris as special counsel. The application was filed on July 21. About Howrey LLP Three creditors filed an involuntary Chapter 7 petition (Bankr. N.D. Calif. Case No. 11-31376) on April 11, 2011, against the remnants of the Washington-based law firm Howrey LLP. The filing was in San Francisco, where the firm had an office. The firm previously was known as Howrey & Simon and Howrey Simon Arnold & White LLP. The firm at one time had more than 700 lawyers in 17 offices. The partners voted to dissolve in March. The firm specialized in antitrust and intellectual-property matters. The three creditors filing the involuntary petition together have $36,600 in claims, according to their petition. The involuntary chapter 7 petition was converted to a chapter 11 case in June at the request of the firm. In its schedules filed in July, the Debtor disclosed assets of $138.7 million and liabilities of $107.0 million. HUDSON HEALTHCARE: Meeting to Form Creditors Committee Friday ------------------------------------------------------------- Roberta DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on August 12, 2011, at 9:30 a.m. in the bankruptcy case of Hudson Healthcare Inc. The meeting will be held at: United States Trustee's Office One Newark Center 1085 Raymond Blvd. 21st Floor, Room 2106 Newark, NJ 07102 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Hudson Healthcare Inc. is the nonprofit operator of Hoboken University Medical Center in Hoboken, New Jersey. Hudson Healthcare filed for Chapter 11 protection (Bankr. D. N.J. Case No. 11-33014) in Newark on Aug. 1, 2011, estimating assets and debt of less than $50 million. Attorneys at Trenk, Dipasquale, Webster, et al., serve as counsel to the Debtor. J. RAY MCDERMOTT: Moody's Affirms 'Ba1' Corporate; Outlook Stable ----------------------------------------------------------------- Moody's Investors Service affirmed McDermott International Inc.'s Ba1 corporate family rating, Ba2 probability of default rating and Baa3 senior secured bank facility rating. The ratings outlook remains stable. The affirmation of MDR's corporate family rating reflects Moody's view that the company's strong balance sheet and favorable operating track record provide it with the capacity to absorb an expected increase in business and financial risks. Moody's expects such risks to increase over the 12 to 18 month ratings horizon as MDR invests to expand its existing capabilities in the deep water and subsea segments of the offshore engineering and construction market. RATINGS RATIONALE MDR's Ba1 corporate family rating reflects its leading position in a niche market segment that has favorable long-term fundamentals. The offshore E&C industry is however highly competitive and cyclical and MDR's large, fixed-price contracts are susceptible to cost overruns. These risks are mitigated by the company's significant order backlog, late-cycle contributions, a focus on project risk management and MDR's strong market position. While the rating incorporates Moody's expectation that acquisition activity and/or increased capital expenditures may consume cash and cause its adjusted leverage to rise from less than 1x currently, Moody's expects MDR's balance sheet will remain conservatively leveraged and supported by strong liquidity, providing meaningful cushion against the downside risks inherent in its business. The stable outlook considers Moody's view that while MDR's measures of financial strength may periodically weaken due to contract issues or, longer term, to pursue strategic growth initiatives, the company's balance sheet is expected to remain conservatively leveraged while its strong liquidity position provides additional downside protection. Upwards movement of MDR's ratings is unlikely in the near term but could occur on a longer term basis should the company demonstrate consistent disciplined bidding practices and strong project execution. Key credit metrics associated with an upgrade would include adjusted Debt/EBITDA sustained below 1.25x. The rating could be lowered should cost overruns lead to sustained EBITA margins in the mid single digits, or should the company's balance sheet deteriorate through either its growth ambitions or shareholder return initiatives such that adjusted Debt/ EBITDA was expected to be sustained above 2x. Moody's last rating action on MDR was on August 11, 2010 when Moody's repositioned the ratings of MDR's subsidiary, J Ray McDermott, S.A. to MDR. The repositioning of the ratings followed completion of the spin-off of Babcock & Wilcox Company from MDR. The principal methodology used in rating MDR was the Global Construction Industry Methodology, published November 2010. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA, published June 2009. Headquartered in Houston, Texas, McDermott International, Inc. is a leading full-service engineering and construction company focused exclusively on offshore upstream oil & gas. Revenues for the last twelve months ended June 30, 2011 were about $3 billion. JACKSON HEWITT: Wins Confirmation of Exit Plan ---------------------------------------------- Peg Brickley, writing for Dow Jones Newswires, reports that Jackson Hewitt Tax Service Inc. on Monday won court approval to exit bankruptcy with its balance sheet revamped and free from accusations it bilked consumers on tax-related loans. According to the report, Judge Mary Walrath said she would confirm the Chapter 11 debt-restructuring plan. Dow Jones relates Jackson Hewitt attorney Mark McDermott, Esq., at Skadden Arps Slate Meagher & Flom, said lenders owed $357 million will swap that secured debt for ownership of the company and a new $100 million note. In court papers, the company is said to be worth an estimated $225 million. Additionally, the lenders are providing a $115 million new revolving loan to keep Jackson Hewitt going until the start of the next tax season. Dow Jones relates the lenders and lawyers for the official committee of unsecured creditors have reached a deal that sets aside $1.1 million for the low-ranking creditors, who were originally slated to get nothing under Jackson Hewitt's plan. "The lenders in this case are really giving a lot to get this company reorganized," Mr. McDermott said, Dow Jones notes. About Jackson Hewitt 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 tapped Deloitte & Touche to serve as tax advisors and Kekst & Company to serve as communications advisors. BDO Financial serves as financial advisors to the Official Committee of Unsecured Creditors. Duane Morris serves as the panel's counsel. 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. But the unsecured creditors won an extra month to investigate the company's prepackaged reorganization plan and secured resources for the effort after a judge refused to place a hard cap on attorneys' fees. JEFFERSON COUNTY: May Be Near Deal with Bondholders --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that commissioners for Jefferson County, Alabama, put off a decision until Aug. 12 on filing for municipal bankruptcy reorganization after the governor said a settlement was within "striking distance." Governor Robert Bentley said, "I will support a properly structured bankruptcy if a satisfactory agreement cannot be reached by the end of [this week]" The discussions concern the size of the haircut creditors will take on $3.1 billion in defaulted sewer bonds. The amount of sewer-rate increases is also a topic of negotiation. Shelly Sigo, writing for The Bond Buyer, recounts that in mid- July, Jefferson County submitted a settlement proposal that asked creditors to take a $1.3 billion haircut while agreeing to sewer rate increases of 7.8% annually for three years then 3% hikes each year. Creditors responded with a counteroffer agreeing to forgive $1 billion of the debt while seeking 8% rate increases each year for five years. Much of the debt is held by large banks and bond insurers. The county's largest creditor is JPMorgan. According to The Bond Buyer, Commission President David Carrington said after Thursday's closed-door meeting, "The commission has reviewed the creditor's offer in exhaustive detail, point by point." He added that, "[Gov. Robert Bentley] has requested the commission enter into another standstill to get additional concessions from the creditors." According to The Bond Buyer, one Wall Street firm said the settlement could set a bad precedent. "In our opinion, the creditors' ostensible capitulation to Jefferson County's demands for principal reduction sets a disquieting precedent," Bank of America Merrill Lynch said in a report on Friday, The Bond Buyer relates. "In light of the county's troubled execution of the capital program, not to mention a history of neglecting -sewerage treatment and control dating back to the late 19th century, concessions made by the creditors in this instance could discourage investors from supporting both ongoing and prospective large-scale, multi-year capital programs intended to enable communities to comply with the Clean Water Act," the Merrill report said. The Bond Buyer also relates Merrill Lynch speculated that creditors may be willing to take such a large haircut for several reasons, including the fact that some investors picked up the county's sewer debt at deeply discounted prices in the secondary market. The lengthy time and expense of litigation in bankruptcy court could be another reason why creditors are willing to settle, the Merrill report said. The Bond Buyer notes additional concessions being sought by the county in last week's counteroffer were not released. About Jefferson County Jefferson County has its seat in Birmingham, Alabama. It has a population of 660,000. It ended its 2006 fiscal year with a $42.6 million general fund balance, according to Standard & Poor's. Jefferson County is trying to restructure $3.2 billion in sewer debt. A bankruptcy by Jefferson County stands to be the largest municipal bankruptcy in U.S. history. It could beat the record $1.7 billion set by Orange County, California in 1994. In September 2010, Alabama Circuit Court Judge Albert Johnson named John S. Young Jr. LLC as receiver for the sewer system. Jefferson County has retained Kenneth Klee, Esq., at Klee Tuchin Bogdanoff & Stern LLP to represent the county in the event of bankruptcy. Mr. Klee is considered to be a municipal-bankruptcy expert, having handled Orange County's bankruptcy case. KAZI FOODS: Can't Assume KFC Franchise Deals Absent Consent ----------------------------------------------------------- Bankruptcy Judge Thomas J. Tucker ruled that Kazi Foods of Michigan, Inc., may not assume any of their franchise agreements with KFC Corporation without KFC's consent pursuant to 11 U.S.C. Sec. 365(c)(1). The Debtors filed four motions to assume certain pre-petition franchise agreements with KFC and establish cure costs associated with the proposed assumptions. KFC objected on numerous grounds, including that under Sec. 365(c)(1), the Debtors cannot assume any of the franchise agreements without KFC's consent, and KFC does not consent. A copy of Judge Tucker's Aug. 4, 2011 Opinion is available at http://is.gd/jOtOQMfrom Leagle.com. About Kazi Foods Kazi Foods is the second-largest Kentucky Fried Chicken franchisee and the 11th-largest restaurant franchisee in the world. The bankruptcy filing by four of its 11 entities affects approximately 130 restaurant locations across Michigan, Florida, New York, New Jersey and Maryland. Kazi Foods of Michigan Inc. and Kazi Foods of Florida Inc. filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case Nos. 11-43971 and 11-43986) on Feb. 17, 2011. Kazi Foods of Annapolis, Inc., filed a Chapter 11 petition (Bankr. E.D. Mich. Case No. 11-47556) on March 21, 2011. Kazi Foods of New York, Inc., simultaneously sought Chapter 11 protection (Case No. 11-47551). Stephen M. Gross, Esq. -- sgross@mcdonaldhopkins.com -- at McDonald Hopkins, PLC, represents the Debtors. Kazi Michigan estimated under $50,000 in assets and $1 million to $10 million in debts. Each of Kazi Florida, Kazi Annapolis and Kazi NY estimated $1 million to $10 million in both assets and debts. KOBRA EFS: Unit Files Schedules of Assets & Liabilities ------------------------------------------------------- Fairway Commons II, LLC, a subsidiary Kobra EFS, filed with the U.S. Bankruptcy Court for the Eastern District of California, its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------- ----------- A. Real Property $10,400,000 B. Personal Property $673,344 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $13,909,790 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $181,700 ----------- -------------- TOTAL $11,073,344 $14,091,490 Kobra EFS, in Roseville, California, filed for Chapter 11 bankruptcy (Bankr. E.D. Calif. Case No. 11-35250) on June 20, 2011. Affiliates that also sought Chapter 11 protection are Fairway Commons II, LLC (Case No. 11-35255) and Eureka Ridge, LLC (Case No. 11-35256). Judge Christopher M. Klein presides over the case. Paul A. Warner, Esq., serves as the Debtors' bankruptcy counsel. Kobra EFS and Fairway Commons II separately estimated $10 million to $50 million in both assets and debts. KRONOS INTERNATIONAL: Reports $67.8 Million Net Income in Q2 ------------------------------------------------------------ Kronos International, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on form 10-Q, reporting net income of $67.80 million on $404 million of net sales for the three months ended June 30, 2011, compared with net income of $9 million on $256.60 million of net sales for the same period during the prior year. The Company also reported net income of $108.90 million on $702.70 million of net sales for the six months ended June 30, 2011, compared with net income of $49.30 million on $485.40 million of net sales for the same period a year ago. The Company's balance sheet at June 30, 2011, showed $1.13 billion in total assets, $831.30 million in total liabilities, current and noncurrent, and $299.80 million in total stockholders' equity. Steven L. Watson, Chief Executive Officer, said, "Our segment profit in the first half of 2011 nearly quadrupled from the first half of last year. Continued strong global demand for TiO2 products allowed us to successfully implement further increases in our TiO2 selling prices during the first half of the year. Even with the cost of ore and other raw materials increasing, we believe our profit margins will continue to expand. We have continued to operate our manufacturing facilities at near full practical capacity utilization levels, and set several new internal production records during the first six months of 2011. With constraints to adding significant new production capacity, especially for the premium grades of TiO2 products through the chloride process, and the growing worldwide demand for TiO2 products, we believe the significant global shortage of TiO2 products will continue for several years. We believe increased and sustained profit margins will be necessary before the magnitude of increased TiO2 production capacity will match future demand levels. As a result, we expect our cash flows and profitability to continue to increase beyond 2011." A full-text copy of the Form 10-Q is available for free at: http://is.gd/i0Jcw3 About Kronos International Kronos International, Inc., produces and markets TiO2 pigments in Europe, and is a wholly owned subsidiary of Kronos Worldwide, Inc., headquartered in Dallas, Texas. * * * As reported by the TCR on April 15, 2011, Fitch Ratings has upgraded Kronos International, Inc.'s (Kronos International) Issuer Default Rating (IDR) to 'B' from 'B-'. Fitch's ratings reflect high financial leverage at Kronos International, as well as Kronos Worldwide, Inc.'s (Kronos Worldwide) solid market position in the titanium dioxide (TiO2) industry. The ratings also reflect the recovery in the TiO2 industry and Fitch's expectations that operating EBITDA will average at least $150 million, annually over the next 24 months. In July 2011, Moody's Investors Service raised Kronos International, Inc.'s Corporate Family Rating to B1 from B2 and upgraded the rating on the company's senior secured notes due 2013 to B2 (LGD5, 75%) from B3 (LGD5, 72%). The upgrade reflects KII's strong operating results, the currently favorable TiO2 market and the expectation that the company will continue to enjoy strong margins, despite ore cost increases, as further TiO2 price increases are implemented. * * * This concludes the Troubled Company Reporter's coverage of Kronos International until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. LAW ENFORCEMENT: Frost PLLC Resigns as Independent Accountant ------------------------------------------------------------- In a Form 8-K filing Thursday, Law Enforcement Associates Corporation discloses that on Aug. 1, 2011, Frost, PLLC, resigned from its role as the independent accountant of the Company. Frost has advised the Company that its decision to resign was a result of the bankruptcy filing and the unpaid invoices totaling approximately $40,000 owed to Frost for previous accounting services rendered to the Company. Frost's opinion on the Company's consolidated financial statements for the year ended Dec. 31, 2010, included an explanatory paragraph regarding the uncertainty that the Company would continue as a going concern. Frost's report indicated that, as a result of ongoing litigation matters, a working capital deficit, the significant operating losses already incurred, and the limited financial resources of the Company, there is substantial doubt about the ability of the Company to continue as a going concern. Other than aforementioned going concern assumption, Frost's report on the consolidated financial statements of the Company as of and for the year ended Dec. 31, 2010, does not contain an adverse opinion or a disclaimer of opinion, nor is the report qualified or modified as to additional uncertainties, audit scope, or accounting principles. Given the pending bankruptcy case, the Company's Board of Directors does not intend to appoint a new independent registered public accounting firm at this time. About Law Enforcement Law Enforcement Associates Corporation was formed on Dec. 3, 2001 when the Company acquired all the outstanding stock of Law Enforcement Associates, Inc., a New Jersey company, incorporated in 1972, doing business in North Carolina. The Company's operations consist of the manufacturing and providing of surveillance and intelligence gathering products and vehicle inspection equipment. Products are used by law enforcement agencies, the military, security, and correctional organizations. Law Enforcement Associates Corporation filed a Chapter 11 bankruptcy petition (Bankr. E.D.N.C. Case No. 11-05686) on July 27, 2011. William P. Janvier, Esq., at Janvier Law Firm, PLLC, in Raleigh, North Carolina, serves as counsel. In the petition, the Debtor estimated assets of up to $50,000 and debts of up to $10 million. LIBBEY INC: S&P Raises Corporate Credit Rating to 'B+' ------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate and senior secured debt ratings on Toledo, Ohio-based Libbey Inc. to 'B+' from 'B'. The rating outlook is stable. Libbey had about $412.5 million of reported debt outstanding as of June 30, 2011. "The upgrade and stable outlook reflect our belief that Libbey will sustain its improved profitability and credit measures and maintain its adequate liquidity position," said Standard & Poor's credit analyst Rick Joy. "The company has seen a rebound in profitability since early 2010, reflecting improved demand for its glassware and dinnerware products in the U.S. and strong growth in its international operations. For the 12 months ended June 30, 2011, revenues increased by more than 6%, and were up more than 7% in the quarter ended June 30, excluding the impact of the recent sale of its Traex plastic dinnerware business. We estimate the company's adjusted EBITDA margins narrowed slightly to 16.9% for the 12 months ended June 30, 2011, from 17% in the prior-year period, as the benefits of cost-reduction initiatives and higher capacity utilization have largely offset cost inflation. However, EBITDA margins have increased substantially from 10.2% in June 2009 as a result of previously implemented cost-cutting initiatives and facility rationalization. Credit measures have improved for the 12 months ended June 30, 2011, with estimated lease and pension-adjusted total debt to EBITDA decreasing to about 4.4x from 5.0x in the previous year period, and funds from operations to total debt increasing to 14.1% from 6.1%," S&P related. "The ratings on Libbey reflect our opinion of the company's weak business risk profile and aggressive financial risk profile. We view the company as having a narrow business focus, capital- intensive operations, vulnerability to volatile natural gas prices, and a leveraged financial profile which includes sizable unfunded pension and postretirement medical benefit obligations. (Libbey Glass Inc., the company's wholly owned subsidiary, is the issuer of the company's senior secured notes. For analytical purposes, we view Libbey and Libbey Glass Inc. as one economic entity.) We believe Libbey benefits from channel diversification and leading market shares as a glass beverageware provider in the U.S. foodservice and retail industries. The company also holds the leading market position in glass tableware in Mexico through its subsidiary Crisa Libbey Commercial S. de R.L. de C.V. (not rated)," S&P stated. LIFECARE HOLDINGS: Completes Acquisition of HealthSouth Hospitals ----------------------------------------------------------------- LifeCare Holdings, Inc., has completed its transaction to acquire the long term acute care hospitals of HealthSouth Corporation. With this transaction, LifeCare now operates 27 LTACHs in 10 states, totaling 1,392 licensed beds. The new hospital facilities are located in Sarasota, FL; Las Vegas, NV; Mechanicsburg and Monroeville, PA.; and Ruston, LA, with remote locations in the neighboring communities of Farmerville and Homer. LifeCare has historically operated hospitals in four of the five states in which the HealthSouth hospitals are located, providing opportunities to increase market share and strengthen referral and payor relationships. "With the completion of this transaction, we have not only expanded our network of facilities but have also enhanced our workforce of highly trained, compassionate caregivers," said LifeCare Chairman and Chief Executive Officer Phillip B. Douglas. "We look forward to the opportunity to share best practices with these hospitals and to integrate them into our efforts to consistently improve outcomes for patients in need of the intensive level of care provided in an LTACH environment." Total consideration to HealthSouth was $117.5 million, which included the value of working capital not acquired by LifeCare. The transaction was financed by additional drawings under LifeCare's senior secured credit facility and by proceeds generated from the sale of the real estate assets associated with four of the acquired hospitals. The transaction is expected to be immediately deleveraging to LifeCare Holdings' balance sheet on a pro forma basis. Second Amended and Restated Master Lease Agreement On Aug. 1, 2011, LifeCare REIT 1, Inc., a subsidiary of LifeCare Holdings, Inc., entered into a Second Amended and Restated Master Lease Agreement with Health Care REIT, Inc., HCRI Texas Properties, Ltd., HCRI Wisconsin Properties, LLC, HCRI Pennsylvania Properties, Inc. and HCRI Louisiana Properties, L.P., collectively as Landlord, adding four Long Term Acute Care Hospitals to the existing Master Lease Agreement, dated May 2, 2007, between the Landlord and the Tenant, which covered two other long term acute care hospitals. Under the Second Amended and Restated Lease, the Landlord acquired title to the LTACHs on Aug. 1, 2011, from HealthSouth Corporation or its affiliates. The LTACHs are located in Mechanicsburg, Pennsylvania (68 beds), Las Vegas, Nevada (70 beds), Sarasota, Florida (40 beds) and Ruston, Louisiana (40 beds). The LTACH located in Ruston, Louisiana has two remote facilities, one located in Farmerville, Louisiana (12 beds) and the second located in Homer, Louisiana (18 beds). These two remote facilities are not leased from the Landlord and are not included in the Second Amended and Restated Lease. In addition, the LTACH located in Monroeville, Pennsylvania (87 beds) acquired from HealthSouth pursuant to the Purchase Agreement (defined below) was not acquired by the Landlord and is not included in the Second Amended and Restated Lease. Each of the LTACHs was previously owned and operated by HealthSouth. The Second Amended and Restated Lease became effective with respect to the LTACHs on Aug. 1, 2011, and its initial 15-year term ends on July 31, 2026. The Second Amended and Restated Lease contains an option to renew for one 14-year, 11-month renewal term. The rent for the LTACHs under the Second Amended and Restated Lease is computed based upon the Landlord's investment amount allocated to the LTACHs multiplied by the greater of (i) a spread over the trading yield on 10-year U.S. Treasury Notes, or (ii) 9.5%, and is subject to an annual inflation adjustment. The Second Amended and Restated Lease is an "absolute net lease." The Second Amended and Restated Lease is guaranteed by the Company, San Antonio Specialty Hospital, Ltd., LifeCare Hospitals of Milwaukee, Inc., LifeCare Hospitals of Mechanicsburg, LLC, LifeCare Specialty Hospital of North Louisiana, LLC, LifeCare Hospital at Tenaya, LLC and LifeCare Hospitals of Sarasota, LLC. On Aug. 1, 2011, the Company and LifeCare Hospitals of Houston, LLC, paid a transaction fee of $750,000 to Health Care REIT, Inc., and an indirect parent of the Company granted a warrant to HealthCare REIT, Inc., to purchase 6.25% of the shares of Parent's common stock. About LifeCare Holdings Plano, Tex.-based LifeCare Holdings, Inc. -- http://www.lifecare-hospitals.com/-- operates 19 hospitals located in nine states, consisting of eight "hospital within a hospital" facilities (27% of beds) and 11 freestanding facilities (73% of beds). Through these 19 long-term acute care hospitals, the Company operates a total of 1,057 licensed beds and employ approximately 3,200 people, the majority of whom are registered or licensed nurses and respiratory therapists. Additionally, the Company holds a 50% investment in a joint venture for a 51-bed LTAC hospital located in Muskegon, Michigan. The Company's balance sheet at March 31, 2011, showed $454.17 million in total assets, $469.25 million in total liabilities, and a $15.08 million stockholders' deficit. * * * LifeCare Holdings carries "Caa1" corporate family and probability of default ratings, with negative outlook, from Moody's Investors Service and a 'CCC-' corporate credit rating, with negative outlook from Standard & Poor's Ratings Services. In November 2010, Standard & Poor's Ratings lowered its corporate credit rating on LifeCare Holdings to 'CCC-' from 'CCC+'. "The downgrade reflects the imminent difficulty the company may have in meeting its bank covenant requirements and the risk of it successfully refinancing significant debt maturing in 2011 and 2012," said Standard & Poor's credit analyst David Peknay. The likelihood of a debt covenant violation is heightened by the company's lack of appreciable operating improvement coupled with a large upcoming tightening of is debt covenant in the first quarter of 2011. Additional equity by the company's financial sponsor may be necessary to avoid a covenant violation. Accordingly, S&P believes the chances of bankruptcy have increased. As reported by the TCR on May 26, 2011, Standard & Poor's Rating Services affirmed its 'CCC-' corporate credit rating and its senior subordinated debt rating on Plano, Texas-based LifeCare Holdings Inc. "The low-speculative-grade rating on LifeCare reflects its narrow focus in a competitive business heavily reliant on uncertain Medicare reimbursement," said Standard & Poor's credit analyst David Peknay, "and its highly leveraged financial risk profile highlighted by very weak cash flow protection measures, slim liquidity, and very high debt level." LINDA M JONES: Bankruptcy Case Re-converted to Chapter 11 --------------------------------------------------------- Chief Bankruptcy Judge Frank R. Alley III denied the request of creditor PremierWest Bank and Charles and Joyce Todd to dismiss the bankruptcy case of Linda M. Jones under Chapter 12 of the Bankruptcy Code. The case originated as a Chapter 11 filing (Bankr. D. Ore. Case No. 10-65478) on Sept. 9, 2010, and later converted to Chapter 12 on Ms. Jones' motion. The Todds argued Ms. Jones is ineligible for Chapter 12 relief. Judge Alley said he finds Ms. Jones to be ineligible for Chapter 12 relief but affords her an opportunity to reorganize in Chapter 11. "[Ms. Jones] deserves a chance to reorganize, especially given the salutary societal endeavor with which she is so closely affiliated," the judge said. Judge Alley directed Ms. Jones to file a Chapter 11 plan and disclosure statement by Aug. 31, 2011. A copy of Judge Alley's Aug. 2, 2011 Memorandum Opinion is available at http://is.gd/Wd48gCfrom Leagle.com. Ms. Jones owns and maintains 22 acres of land and improvements in rural Jackson County, Oregon, doing business as "Eden Farm." Her principal activity is boarding and training horses. She also offers riding lessons and occasionally puts on horse shows. She keeps about 45 horses on the property, 3 of which she owns. Of the remaining horses, about 15 are owned by private third parties; the balance are owned by Equamore Foundation, a Sec. 501(c)(3) charitable foundation whose mission is to care for abandoned or neglected horses. Ms. Jones is Equamore's executive director. For the most part, the Equamore horses are not saleable. On occasion Equamore will permit third parties to adopt a horse for a fee, although due to the economy, it often waives its adoption fee. Equamore hires veterinarians to geld all of the stallions it takes in. If one of its mares is pregnant when taken in, Equamore will also raise the foal, but not for resale. The great bulk of Ms. Jones' income comes from boarding fees. Private parties pay $350 per month to board a horse. Equamore is also supposed to pay a monthly fee, but due to lack of funds, now owes Ms. Jones over $89,000. Ms. Jones lives on the property. It is zoned by Jackson County for exclusive farm use. Ms. Jones has obtained a conditional use permit from the County planning authorities. The permit apparently authorizes an additional dwelling on the property for farm labor, and the use of the property for boarding and showing up to 50 horses. Ms. Jones' 3 employees (1 full-time, 2 part- time), are treated as "agricultural employees" for tax purposes. LINDEN PONDS: To Seek Plan Confirmation on Aug. 18 -------------------------------------------------- Jessica Bartlett at boston.com reports that Linden Pond has a hearing scheduled for Aug. 18 in Dallas, where a federal bankruptcy judge is expected to approve its debt-restructuring plan. The proposal includes forgiving about $34 million of Linden Ponds' $150 million debt. According to Hingham officials, Linden Ponds owes $1.7 million in property taxes for the third and fourth quarters of the fiscal year that ended June 30. An additional $799,519 was due to the town last Monday, and was paid by the company later in the week, officials said. The next quarterly payment of $799,519 will come due Nov. 1, and the company expects to pay that on time, officials said. Town Administrator Ted Alexiades said Linden Ponds will be paying 14 percent interest on top of the taxes in arrears from the 2011 fiscal year. If the bill isn't paid by late September, he said, the town will put a lien in the property, and bump the interest rate to 16 percent. About Linden Ponds Linden Ponds Inc. operates a 108-acre continuing care retirement community located at 300 Linden Ponds Way in Hingham, Massachusetts. The facility has 988 independent living units (with an occupancy rate of 87.9%) and 132 skilled nursing beds (68% occupancy rate). Linden Ponds leases the facility and the property upon which it is built from Hingham Campus LLC. Hingham is the owner of the facility and owns the fee simple interest in the property upon which the facility is built. Senior Living Retirement Communities, LLC, formerly known as Erickson Retirement Communities, LLC, owns 100% of the membership interests in Hingham. Hingham Campus and Linden Ponds filed a pre-negotiated Chapter 11 petition (Bankr. N.D. Tex. Lead Case No. 11-33912) in Dallas on June 15, 2011. Hingham Campus estimated assets and debts of $100 million to $500 million. Debt includes $156.4 million owing on bonds issued by the Massachusetts Development Finance Agency, with Wells Fargo Bank, National Association, as the bond trustee. Erickson Retirement Communities sought bankruptcy protection (Bankr. N.D. Tex. Case No. 09-37010) on Oct. 19, 2009. Erickson, the owner of 20 senior living facilities, won approval of its reorganization plan in April 2010. The Erickson plan provided for a sale to Redwood Capital, the highest bidder at the auction in December 2009. Redwood won the auction with an all-cash bid of $365 million. Attorneys at DLA Piper LLP (US) represent Hingham in the Chapter 11 case. Attorneys at McGuire, Craddock & Strother, P.C., and Whiteford, Taylor And Preston, L.L.P., represent Linden Ponds. LITTLETON APARTMENTS: Files Schedules of Assets and Liabilities --------------------------------------------------------------- Littleton Apartments LLC, filed with the U.S. Bankruptcy Court for the Northern District of Texas its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $571,814 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $40,568,366 E. Creditors Holding Unsecured Priority Claims $78,472 F. Creditors Holding Unsecured Non-priority Claims $13,646,594 ----------- ----------- TOTAL $571,814 $54,293,432 Affiliate MS 128 Littleton Limited Partnership also filed its schedules disclosing assets of $100 and liabilities of $0. About Littleton Apartments Based in Dallas, Texas, Littleton Apartments LLC, owns a newly constructed 350-unit luxury apartment property in downtown Littleton, Colorado, known as the "Alexan Downtown Littleton". MS 128 Littleton Limited Partnership owns 100% of the membership interests in Littleton and has no other assets. Neither Littleton nor MS 128 have any employees. The Property is managed by GREP Southwest, LLC d/b/a Greystar, pursuant to a Management Agreement. Littleton and MS 128 filed separate Chapter 11 petitions (Bankr. N.D. Tex. Case Nos. 11-34564 and 11-34563) on July 14, 2011. The cases are jointly administered. Judge Stacey G. Jernigan presides over the cases. Patrick J. Neligan, Jr., Esq., at Neligan Foley LLP, serves as counsel. In its petition, Littleton Apartments estimated assets and debts of $50 million to $100 million. The petitions were signed by Timothy J. Hogan, vice president. LITTLETON APARTMENTS: Has Interim Access to Secured Lenders' Cash ----------------------------------------------------------------- On July 28, 2011, the U.S. Bankruptcy Court for the Northern District of Texas authorized Littleton Apartments LLC to use cash collateral on an interim basis, pursuant to a budget, with a permitted variance of 10% on a line-item basis and a variance of 10% on the aggregate budget. As adequate protection, the pre-petition Secured Lenders are granted replacement liens in all post-petition assets of Littleton and proceeds thereof, including, without limitation, all Rents, issues and income generated by the Property, excluding any causes of action under Chapter 5 of the Bankruptcy Code. As reported previously, Littleton Apartments LLC seeks authority from the Bankruptcy Court to use rent from its Colorado apartment to fund the business while in Chapter 11. The Debtor said the rent constitute cash collateral securing obligations to its prepetition lenders. Littleton said it owes a syndicate of lenders led by California Bank & Trust, as agent, under the terms of a Construction Loan Agreement, Secured Promissory Note, Deed of Trust, and various accompanying loan documents dated July 1, 2008. The amounts owed under the Loan Documents are secured by a lien on, inter alia, the Property, the rents generated by the Property, and all of Littleton's personal property. As of the Petition Date, the outstanding amount due under the Loan Documents was $40.6 million. The Debtors have prepared a 30-day budget, from July 15 through Aug. 14. The Debtors expect total income on the Property to be $384,951. Total operating and non-recoverable expenses are expected to be $89,729. About Littleton Apartments Based in Dallas, Texas, Littleton Apartments LLC, owns a newly constructed 350-unit luxury apartment property in downtown Littleton, Colorado, known as the "Alexan Downtown Littleton". MS 128 Littleton Limited Partnership owns 100% of the membership interests in Littleton and has no other assets. Neither Littleton nor MS 128 have any employees. The Property is managed by GREP Southwest, LLC d/b/a Greystar, pursuant to a Management Agreement. Littleton and MS 128 filed separate Chapter 11 petitions (Bankr. N.D. Tex. Case Nos. 11-34564 and 11-34563) on July 14, 2011. The cases are jointly administered. Judge Stacey G. Jernigan presides over the cases. Patrick J. Neligan, Jr., Esq., at Neligan Foley LLP, serves as counsel. In its petition, Littleton Apartments estimated assets and debts of $50 million to $100 million. The petitions were signed by Timothy J. Hogan, vice president. LOS ANGELES DODGERS: Seeks Court OK for $150 Million Loan from MLB ------------------------------------------------------------------ The Los Angeles Dodgers is asking a Delaware bankruptcy judge to approve a $150 million loan from Major League Baseball that would keep the team operating for the remainder of the season. Canada.com reports that the Los Angeles Dodgers and Major League Baseball have agreed on a $150 million loan to keep the club financially operational through the rest of the season. According to the Canada.com report, the saga with one of the most storied franchises in baseball and its money issues reached its climax two weeks ago when a U.S. Bankruptcy Court rejected the Dodgers' recently proposed $150 million bankruptcy financing plan. The report says Dodgers owner Frank McCourt then rebuffed MLB's loan offer in favor of a deal with hedge fund Highbridge Capital, which Judge Kevin Gross found unacceptable and instead directed the team to negotiate a deal with the league. The parties agreed to the terms and conditions per Judge Gross' instructions, according to MLB.com on Friday. Terms of $150-Mil. Loan Marie Beaudette, writing for Dow Jones' Daily Bankruptcy Review, reports that The Los Angeles Dodgers on Friday disclosed the terms of a deal to borrow up to $150 million from Major League Baseball -- two weeks after a bankruptcy judge rejected the team's request to borrow the money from preferred lender, Highbridge Principal Strategies, a hedge fund affiliated with JP Morgan Chase & Co. According to DBR, Dodgers filed details of the new loan deal along with a proposed final order authorizing the team to tap the financing. On July 22, Judge Gross denied the Dodgers' request because MLB had put up a better deal. MLB had offered to provide the bankruptcy financing on an unsecured basis, at a reduced interest rate and without nearly $10 million in fees the team had agreed to pay Highbridge. Judge Gross required the MLB loan to be free of control provisions and assured the Dodgers that he would offer protections in "the hopefully unlikely event that baseball strays from its obligations to act in good faith." According to the report, the team will use the loan to pay off borrowings under the Highbridge loan, which was approved by Judge Gross on an interim basis shortly after the team sought Chapter 11 protection. According to court papers, the payoff amount as of 5 p.m. Wednesday was about $61.2 million. About the Los Angeles Dodgers Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a professional Major League Baseball club in the Los Angeles metropolitan area. Frank McCourt, a Boston real-estate developer who unsuccessfully bid for the Boston Red Sox, bought the Dodgers from Rupert Murdoch's Fox Entertainment Group, Inc. in 2004 for $330 million. Mr. McCourt also bought the Dodgers Stadium from Fox for $100 million. Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB Commissioner Bud Selig rejected a television deal with News Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for June 30 and July 1. Fox Sports has exclusive cable television rights for Dodgers games until the end of 2013 baseball season. Chapter 11 filings were also made for LA Real Estate LLC, an affiliated entity which owns Dodger Stadium, and three other related holding companies. The petition estimates assets of up to $500 million and debts of up to $1 billion. According to Forbes, the team is worth about $800 million, making it the third most valuable baseball team after the New York Yankees and the Boston Red Sox. Judge Kevin Gross presides over the case. Lawyers at Young, Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Thomas Lauria, Esq., at White & Case, represents MLB. Attorneys at Morrison & Foerster LLP and Pinckney, Harris & Weidinger, LLC, serve as counsel to the Official Committee of Unsecured Creditors. The LA Dodgers is the 12th professional sports team in North America to have sought bankruptcy protection, and the fifth baseball club to have done so, after the Texas Rangers in 2010; the Chicago Cubs in 2009; the Baltimore Orioles in 1993; and the Seattle Pilots in 1970. The other seven teams were from the National Hockey League, including the Phoenix Coyotes in 2009. LTV STEEL: Defunct Vendor Retains Attorney-Client Privilege ----------------------------------------------------------- Magistrate Judge Morton Denlow in Chicago barred former offices and directors of LTV Steel Company Inc. from seeking documents subject to attorney-client privilege from Shefsky & Froelich Ltd., which represented Hunter Corporation, a defunct LTV vendor and a member of the Official Committee of Administrative Claimants in the LTV case. Shefsky claims that an attorney-client privilege applies to a number of the subpoenaed documents, while the Defendants argue that the privilege ended when Shefsky's corporate client went out of business. Judge Denlow said Hunter retains it is attorney-client privilege. LTV Steel Company Inc. filed for Chapter 11 bankruptcy on Dec. 30, 2000, but the restructuring attempt collapsed in the fall of 2001. After investigating why the restructuring effort failed, the Official Committee of Administrative Claimants filed a lawsuit in the Northern District of Ohio, claiming that the former directors and officers of LTV breached their fiduciary duties during the restructuring effort by incurring administrative debts that they knew the company could not repay. Hunter Corporation was a construction company and LTV vendor headquartered in Indiana and incorporated in Delaware. The Defendants allegedly forced Hunter out of business by inducing Hunter to perform work for which the Defendants knew LTV could not pay. Specifically, Hunter performed repairs on an LTV facility in 2001 for which LTV never paid. Hunter ceased construction operations shortly thereafter. Hunter has since pursued its claim against LTV, most recently as a member of the ACC in the Ohio action. Chester Jones continues to act as Hunter's President. Hunter was dissolved on March 1, 2009 for failure to pay Delaware franchise taxes. On Feb. 2, 2011, Hunter was officially reinstated as a Delaware Corporation in good standing, after Hunter Vice President and Director Jerry Oshinski filed for revival of the company's charter. Joel Sprayregen, a Shefsky shareholder, both represented Hunter during LTV's bankruptcy and has served as the ACC's F.R.C.P. Rule 30(b)(6) witness in the Ohio action. In 2010, during the period that Hunter was dissolved, the Defendants sought documents from Shefsky relating to Hunter's relationship with LTV. In response to a subpoena issued Dec. 30, 2010, Shefsky withheld some documents on the grounds that they were protected by an attorney- client privilege between Hunter and Shefsky. The case is The Official Committee of Administrative Claimants, on behalf of LTV Steel Company, Inc., v. Glenn J. Moran, James Baske, George Henning, and Eric Evans, Case No. 11 C 3300 (N.D. Ill.). A copy of the Court's Aug. 4, 2011 Memorandum Opinion and Order is available at http://is.gd/WrMBznfrom Leagle.com. About The LTV Corporation Headquartered in Cleveland, Ohio, The LTV Corp. operated as a domestic integrated steel producer. The Company along with 48 subsidiaries filed for Chapter 11 protection on Dec. 29, 2000 (Bankr. N.D. Ohio, Case No. 00-43866). On Aug. 31, 2001, the Company disclosed $4,853,100,000 in total assets and $4,823,200,000 in total liabilities. By order dated Feb. 28, 2002, the Court approved the sale of substantially all of the Debtors' integrated steel assets to WLR Acquisition Corp. n/k/a International Steel Group, Inc., for roughly $80 million, plus assumption of certain environmental and other obligations. ISG also purchased inventories which were located at the integrated steel facilities for $52 million. The sale of the Debtors' integrated steel assets to ISG closed in April 2002, and a second closing related to the purchase of the inventory occurred in May 2002. On Dec. 31, 2002, substantially all of the assets of the Pipe and Conduit Business, consisting of LTV Tubular Company, a division of LTV Steel Company, Inc., and Georgia Tubing Corporation, were sold to Maverick Tube Corporation for cash of roughly $120 million plus the assumption of certain environmental and other obligations. On Oct. 16, 2002, the Debtors announced that they intended to reorganize the Copperweld Business as a stand-alone business. The LTV Corporation no longer exercised any control over the business or affairs of the Copperweld Business. A separate plan of reorganization was developed for the Copperweld Business. On Aug. 5, 2003, the Copperweld Business filed a disclosure statement for the Joint Plan of Reorganization of Copperweld Corporation and certain of its debtor affiliates. On Oct. 8, 2003, the Court approved the Second Amended Disclosure Statement. On Nov. 17, 2003, the Court confirmed the Second Amended Joint Plan, as modified, and on Dec. 17, 2003, the Plan became effective and the common stock was canceled. Because LTV received no distributions under the Second Amended Plan, its equity in the Copperweld Business is worthless and has been canceled. In November 2002, the Debtors paid the DIP Lenders the remaining balance due for outstanding loans and in December 2002, the remaining letters of credit were canceled or cash collateralized. Consequently, the Debtors have no remaining obligation to the DIP Lenders. Pursuant to a February 2003 Court order, LTV Steel continued the orderly liquidation and wind down of its businesses. On Oct. 8, 2003, the Court entered an Order substantively consolidating the Chapter 11 estates of LTV Steel and Georgia Tubing Corporation for all purposes. In November and December 2003, approximately $91.9 million was distributed by LTV Steel to other Debtors pursuant to an Intercompany Settlement Agreement that was approved by the Court on Nov. 17, 2003. On Dec. 23, 2003, the Court authorized LTV Steel and Georgia Tubing to make distributions to their administrative creditors and, after the final distribution, to dismiss their Chapter 11 cases and dissolve. On March 31, 2005, the Court entered an order that among other things: (a) approved a distribution and dismissal plan for LTV and certain other debtors; (b) authorized The LTV Corporation and LTV Steel to take any and all actions that are necessary or appropriate to implement the distribution and dismissal plan; (c) established March 31, 2005, as the record date for identifying shareholders of LTV that are entitled to any and all shareholder rights with respect to the distribution and dismissal plan and the eventual dissolution of LTV; and (d) authorized The LTV Corporation to establish and fund a reserve account for the conduct of post-dismissal activities and the payment of post- dismissal claims. LTV is in the process of liquidating, and its stock is worthless. On March 28, 2007, the Official Committee of Administrative Claimants filed a motion with the Court requesting an order to approve the appointment of a Chapter 11 trustee. On April 11, 2007, April 12, 2007, and May 1, 2007, certain of LTV's former officers and directors filed motions to convert the case to Chapter 7. On June 28, 2007, the ACC filed a motion to withdraw the Chapter 11 Trustee Motion; the Court granted the ACC's withdrawal motion on Aug. 1, 2007. An evidentiary hearing on the Chapter 7 Trustee Motion was held in August 2007. The Court has not yet issued its order. LYMAN LUMBER: Files for Chapter 11 to Sell to Investment Firm ------------------------------------------------------------- Lyman Lumber Co., a Minnesota building-products supplier hit hard by the U.S. housing crisis, filed for Chapter 11 bankruptcy protection to sell itself to a Manhattan investment firm. Lyman Lumber sought Chapter 11 petition together with its affilaites (Bankr. D. Minn. Lead Case No. 11-45190). Lyman Lumber has signed a letter of intent to sell its Midwestern assets to SP Asset Management LLC, an affiliate of Steel Partners Holdings L.P. New York City-based Steel Partners is a diversified holding company that owns and operates businesses in a variety of industries. The purchase price was not disclosed. Lyman, which operates six Midwest divisions that serve contractors and lumber dealers, said it plans to use the Chapter 11 process to restructure debt obligations and to allow it to shed non- performing assets such as its land holdings and construction- lending portfolio, says the Minneapolis/St. Paul Business Journal. Evan Weinberger at Bankruptcy Law360 notes the Chapter 11 filing announcement came one day after Lyman, the largest supplier of lumber, building materials and job-site labor for residential construction in the Midwest, filed for bankruptcy protection in Minnesota. Katy Stech, writing for Dow Jones' Daily Bankruptcy Review, reports that the building-products supplier was hit hard by the U.S. housing crisis. The 113-year old company said the move will enable it to shed some of its money-losing operations while it works to sell its operating assets to an affiliate of hedge-fund firm Steel Partners LLC. Lyman Lumber President Jim Hurd said that the business expects to continue operating throughout the case. Lyman Lumber sells building supplies, such as framing beams, roofing materials, siding and drywall to residential builders. First Day Motions According to DBR, the company is seeking court permission to spend about $9.2 million on taxes, operating expenses and to pay its 750 employees during the first few weeks of the case. DBR relates a Steel Partners representative declined to say whether building-supply companies make up a large part of its investment portfolio. DBR, citing papers filed in court, says Lyman Lumber estimated it owes $19 million to a handful of lenders including U.S. Bank, TCF Bank, Bank of America, Wells Fargo Bank, J.P. Morgan Chase Bank and Prudential Insurance Company of America. Lyman Lumber said it also holds mortgages for properties located in Eau Claire, Wis., Woodinville, Wash., and Matthews, N.C. LYMAN LUMBER: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Lyman Lumber Company P.O. Box 40 Excelsior, MN 55331 Bankruptcy Case No.: 11-45191 Affiliates that simultaneously sought Chapter 11 protection: Debtor Case No. ------ -------- Lyman Holding Company 11-45190 Automated Building Components, Inc. 11-45192 Building Material Wholesalers, Inc. 11-45193 Carpentry Contractors Corp. 11-45194 Construction Mortgage Investors Co. 11-45196 Lyman Development Co. 11-45199 Lyman Lumber of Wisconsin, Inc. 11-45201 Lyman Properties, L.L.C. 11-45202 Mid-America Cedar, Inc. 11-45203 Woodinville Lumber, Inc. 11-45204 Woodinville Construction Services, L.L.C. 11-45206 Chapter 11 Petition Date: August 4, 2011 Court: U.S. Bankruptcy Court District of Minnesota (Minneapolis) Judge: Robert J. Kressel Debtors' Counsel: James L. Baillie, Esq. FREDRIKSON & BYRON, P.A. 200 South Sixth Street, Suite 4000 Minneapolis, MN 55402 Tel: (612) 492-7013 Fax: (612) 492-7077 E-mail: jbaillie@fredlaw.com - and - Sarah M. Gibbs, Esq. FREDRIKSON & BRYON, P.A. 200 S. 6th Street, Suite 4000 Minneapolis, MN 55402 Tel: (612) 492-7452 E-mail: sgibbs@fredlaw.com Lyman Lumber's Estimated Assets: $50,000,001 to $100,000,000 Lyman Lumber's Estimated Debts: $100,000,001 to $500,000,000 The petition was signed by James E. Hurd, president and chief executive officer. Lyman Lumber's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Central States Pension Fund Pension Liability $7,004,056 9377 W. Higgins Road Des Plaines, IL 60018 Scott Kevitt Promissory Note $1,577,446 3335 Pennsylvania Avenue N Crystal, MN 55427 Kevitt Excavating LLC Promissory Note $707,408 3335 Pennsylvania Avenue N Crystal, MN 55427 Kevitt Excavating Inc. Promissory Note $696,816 3335 Pennsylvania Avenue N Crystal, MN 55427 Minnetonka Country Club, et al Promissory Note $590,660 24575 Smithtown Road Shorewood, MN 55331 Ruth B. Witrak, et al Promissory Note $561,593 24575 Smithtown Road Shorewood, MN 55331 Bohdan Witrak, et al Promissory Note $508,618 24575 Smithtown Road Shorewood, MN 55331 Annalee M. Hanson Rev Trust Promissory Note $454,439 6400 Greenbriar Ave Excelsior, MN 55331 Manion's Trade Vendor $436,371 7705 - 305Th Street St Cloud, MN 56303-9411 SVK Development LLC Promissory Note $398,424 3335 Pennsylvania Avenue N Crystal, MN 55427 Timothy J. Schoen Promissory Note $393,407 711 Ashley Drive Chaska, MN 55318 James William Scheible Promissory Note $380,458 8800 Cottonwood Lane Eden Prairie, MN 55347 Timothy G. Liester Promissory Note $343,514 26355 Oak Ridge Circle Shorewood, MN 55331 Dennis J. Amato Promissory Note $320,787 5 The Crow's Nest Port Washington, NY 11050 The J Amato GST Exempt Trust Promissory Note $320,787 Melanie D. Gutterson, Trustee 128 Tracy Lane Alamo, CA 94507 Lucille L. Rust Promissory Note $319,548 5650 Boone Avenue N, Apartment 416 New Hope, MN 55428 Mariellen Waldron Subordinated $312,674 55 Pine Street, #307 Debenture Edmonds, WA 98020 Jeff P & Barbara J. Johnson Subordinated $271,890 1512 Knob Hill Lane Debenture Excelsior, MN 55331 John B. MacWherter Rev Trust Promissory Note $265,193 3670 Northome Road Wayzata, MN 55391 Kim Nhung Nguyen Promissory Note $261,999 4315 Hadley Circle N Oakdale, MN 55128 MACCO PROPERTIES: Shareholder Wants Reorganization Case Dismissed ----------------------------------------------------------------- Jennifer Price, the sole shareholder of Macco Properties, Inc., asks the U.S. Bankruptcy Court for the Western District of Oklahoma to dismiss the Debtor's Chapter 11 case. According to Ms. Price, soon as the Chapter 11 trustee was appointed, the agreement was breached by the U.S. Trustee (and the Chapter 11 trustee), as Macco's management was prohibited from conducting its normal business operations, and the Chapter 11 trustee has made no effort to determine the unsecured debt. Specifically, one of Macco's affiliated companies collected a settlement of an account receivable during the pendency of the case in the amount of $1,375,000. Those funds were intended to be used by Macco to fulfill obligations of its day-to-day operations in managing commercial properties. However, the Chapter 11 trustee seize thos funds, and is failing, refusing and neglecting to properly run Macco's business. The $1,375,000 settlement is more than enough to pay liquidated, non-contingent, due and owing unsecured creditors in full, and there is no need for the Chapter 11 trustee to dramatically change all management of Macco at the expense of all of Macco's creditors and Ms. Price, individually. Ms. Price adds that the Chapter 11 trustee failed to pay the required payments which resulted in a $100,000 penalty to one of Maco's affiliated companies, namely AP Bristol Park Apartments, LLC. Seyburn, Kahn, Bess and Serlin, P.C., and Pinkerton & Finn represented Ms. Price. As reported in the Troubled Company Reporter on July 27, 2011, the Debtor sought for the dismissal of its Chapter 11 case. The Debtor is fighting in the Court to regain control of its $131 million real estate empire that stretches across Oklahoma and Kansas. About Macco Properties Oklahoma City, Oklahoma-based Macco Properties, Inc., filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 10- 16682) on Nov. 2, 2010. G. Rudy Hiersche, Jr., Esq., at the Hiersche Law Firm, serves as the Debtor's bankruptcy counsel. The Debtor disclosed $50,823,581 in total assets, and $4,323,034 in total liabilities. The Official Unsecured Creditors' Committee is represented by Ruston C. Welch, at Welch Law Firm, P.C., in Oklahoma City, Oklahoma. Receivership Services Corp., a division of the Martens Cos., has been named by the Court as property manager for the six Wichita apartment complexes caught up in the bankruptcy of Macco Properties of Oklahoma City. MACCO PROPERTIES: Price Edwards OK'd as Trustee's Property Manager ------------------------------------------------------------------ The Hon. Niles Jackson of the U.S. Bankruptcy Court for the Western District of Oklahoma authorized Michael E. Deeba, the Chapter 11 trustee for Macco Properties, Inc., to retain Price Edwards & Company as property manager. The trustee related that upon assuming his duties and responsibilities, the trustee discovered that the Debtor is the 100% or 99% owner/member/manager of numerous Limited Liability Companies, each of which own or control multi-family apartment complexes, commercial business complexes, shopping center and other non-income producing real properties. These properties are located in Oklahoma, Kansas, Arizona and Texas. With respect to the Oklahoma properties, there are five multifamily apartment complexes located in Oklahoma City and Norman, Oklahoma, as: a. The Brooks Apartments - 2500 W. Brooks Street, Norman, OK. b. Newport/Granada Apartments - 3407 NW 39th & 3405 NW 40th St., OKC, OK. c. Emerald Court Apartments - 4746 NW 23rd Street, OKC, OK. d. Remington Apartments - 7125 S. Sante Fe Ave., OKC, OK. e. Winslow Glen Apartments - 4750 NW 23rd, Street, OKC. OK. These properties represent 745 rental units. In addition, there are four commercial business properties, as: a. Sovereign Business Park - 1220 & 1300 Sovereign row, OKC, OK. b. Charter Business Park - 4219 Charter Ave., OKC, OK. c. Northgate Office Park - 4010 N. Lincoln, OKC, OK. d. MacArthur Executive Building - 4614 N. MacArthur Blvd., OKC, OK. The trustee believes that in order to maintain the value of these properties for the benefit of the bankruptcy estate, competent management is needed to stabilize the business operations. Price Edwards is expected to: a) evaluate the property; b) manage and lease of the property; and c) instruct and advise the trustee as to a marketing plan for and the eventual sale of the property of the Debtor's estate. David Dirkschneider, an employee of Price Edwards, told the Court that pursuant to the Multifamily Property Management Agreements, Price Edwards will receive as compensation for management services a management fee equal to 4% of gross rental receipts from each apartment complex, but no less than $2,500 per property per month. Price Edwards will also receive $1,200 asinitial set-up to compensate it for accounting set-up, including computer and software needs involved in the property operation and the administration of and establishment of employee payroll requirements, including interviewing and hiring of new employees, workers compensation insurance and payroll tax responsibilities. Pursuant to the Property Management and Leasing Agreements, Price Edwards will receive as compensation for management services a management fee equal to $1,500 for each of the properties known as Sovereign Business Park and Northgate Office Park and $1,000 for each of the properties known as Charter Business Park and MacArthur Executive Building and a leasing fee equal to 6% commission if another broker is involved, and 4% if no other broker is involved. In the event there is insufficient funds to pay the monthly management fee, Price Edwards has agreed to accrue the fees until the property is sold and receive payment out of the proceeds of sale. To the best of the trustee's knowledge, Price Edwards is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Macco Properties Oklahoma City, Oklahoma-based Macco Properties, Inc., filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 10- 16682) on Nov. 2, 2010. G. Rudy Hiersche, Jr., Esq., at the Hiersche Law Firm, serves as the Debtor's bankruptcy counsel. The Debtor disclosed $50,823,581 in total assets, and $4,323,034 in total liabilities. The Official Unsecured Creditors' Committee is represented by Ruston C. Welch, at Welch Law Firm, P.C., in Oklahoma City, Oklahoma. Receivership Services Corp., a division of the Martens Cos., has been named by the Court as property manager for the six Wichita apartment complexes caught up in the bankruptcy of Macco Properties of Oklahoma City. MACROSOLVE INC: Steve Signoff Appointed Chief Executive Officer --------------------------------------------------------------- MacroSolve, Inc., appointed a new Chief Executive Officer, Steve Signoff, to lead the Company's revenue growth. Mr. Signoff also joins the Company's Board of Directors. He is a 20-year seasoned sales, marketing, and executive leader with Fortune 250 and Fortune 1000 companies including Sprint and One Communications, as well as serving as a start-up CEO. Effective Aug. 1, 2011, and in conjunction with the appointment of Mr. Signoff, Clint Parr resigned as the Company's Chief Executive Officer. Mr. Parr remains as the Company's President and a member of the Board of Directors. Mr. Signoff joins MacroSolve at a time when the Company is building multiple national sales channels to market and sell its patented suite of mobile apps. "I believe MacroSolve's investments and visionary platform development have poised the Company for growth, with timing and market demand on our side. Now is the time to leverage our technology, strong management team and exceptional board members to drive expanding market share in the mobile app space," stated MacroSolve CEO, Steve Signoff. "Steve is the kind of CEO we need to lead MacroSolve's evolution into our next stage of growth. We will be working closely together to capture revenue opportunities by continuing to develop and distribute innovative products into the mobile apps space," stated MacroSolve's President, Clint Parr. "Both Steve and our new chairman, Howard Janzen, have followed the evolution of mobility for a decade and have kept current with MacroSolve. They saw MacroSolve as perfectly positioned to take advantage of the explosion in the growth of mobility and were happy to have the opportunity to jump on board. The addition of Steve and Howard marks the beginning of strategically selecting new talent at the appropriate time to address the new opportunities that MacroSolve will face," stated Jim McGill, Vice Chairman of MacroSolve. "Our issue now is speed to market with our major partners as part of a strategy to quickly capture the high ground in several vertical markets. The synergistic talents of Steve Signoff and Clint Parr will accelerate the capture of that high ground." Mr. Signoff was most recently Chief Sales and Marketing Officer of One Communications, the largest privately-held, multi-regional integrated telecommunications solutions provider in the United States. He led the company's sales and marketing organization driving revenue via direct, indirect and wholesale channels in the B2B marketplace. Mr. Signoff holds a Bachelor of Arts degree having graduated cum laude in business with a major in finance and a minor in economics. He has completed additional post-graduate courses in business development negotiating, marketing and strategic planning with Harvard Law School, Columbia University and the University of Michigan. He has served on the boards of Vumber, Intelig in Rio de Janeiro, Brazil; Barak in Tel Aviv, Israel; and nonprofit boards including The Kansas City Zoo, the Sprint Foundation and CASA. Effective Aug. 1, 2011, the Company entered into an employment agreement with Mr. Signoff to serve as CEO. The Agreement can be terminated at any time by either party upon 60 days prior written notice. The base salary under the Agreement is initially $330,000, which will be paid in cash, shares of the Company's common stock and notes payable. Mr. Signoff will receive an initial salary of at least $50,000 per annum in cash, notes payable in an amount equal to the difference between $180,000 per annum and the Cash Salary, and shares of Common Stock equal to the difference between the annual salary and the Target. Mr. Signoff received 100,000 shares of Common Stock as a signing bonus. As well, Mr. Signoff is entitled to receive options to purchase 1,500,000 shares of the Company's Common Stock, exercisable at $0.50 per share In addition, Mr. Signoff is entitled to participate in any and all benefit plans, from time to time, in effect for the Company's employees, along with vacation, sick and holiday pay in accordance with its policies established and in effect from time to time. About MacroSolve, Inc. Tulsa, Okla.-based MacroSolve, Inc. (OTC BB: MCVE) -- http://www.macrosolve.com/-- is a technology and services company that develops mobile solutions for businesses and government. A mobile solution is typically the combination of mobile handheld devices, wireless connectivity, and software that streamlines business operations resulting in improved efficiencies and cost savings. As reported in the Troubled Company Reporter on April 7, 2010, Hood Sutton Robinson & Freeman CPAs, P.C., expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted of the Company's recurring losses from operations and net capital deficiency. The Company's balance sheet at March 31, 2011, showed $1.73 million in total assets, $1.66 million in total liabilities and $69,781 in total stockholders' equity. MATIKA VILLA: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Matika Villa, LLC P.O. Box 5156 Salisbury, NC 28147 Bankruptcy Case No.: 11-51204 Chapter 11 Petition Date: August 3, 2011 Court: United States Bankruptcy Court Middle District of North Carolina (Winston-Salem) Judge: William L. Stocks Debtor's Counsel: Edwin H. Ferguson, Jr., Esq. FERGUSON, SCARBROUGH, HAYES, HAWKINS P.O. Box 444 Concord, NC 28025-0444 Tel: (704) 788-3211 Fax: (704) 784-3211 E-mail: ehfafd@fspa.net Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ncmb11-51204.pdf The petition was signed by Timothy D. Smith, member/manager. MEDCLEAN TECHNOLOGIES: Inks Director Agreement with C. Nelson ------------------------------------------------------------- MedClean Technologies, Inc., on Aug. 1, 2011, entered into a Director Agreement with Constance A. Nelson, pursuant to which Ms. Nelson was appointed (i) to the Company's board of directors and (ii) as Chairman of the Board's audit committee. The term of the Director Agreement is for a period of one year, commencing Aug. 1, 2011. The Director Agreement may, at the option of the Board, be automatically renewed on such date that Ms. Nelson is re-elected to the Board. Under the Director Agreement, Ms. Nelson is to be paid 5,000,000 stock options on an annual basis which vest quarterly. Ms. Nelson combines over 30 years of experience in accounting, internal audit, and management in the fields of manufacturing, government and higher education. From 2000 through 2011, she has held positions including Controller, Accounting Manager, Director of Financial Accounting, and Director of Finance for Exide Technologies, a global manufacturing company. From 1996 through 1999 she was Finance Director for the City of Pinecrest, Florida. From 1981 to 1996 she held positions with the State of Tennessee including Assistant Commissioner for the Department of Commerce and Insurance, Vice President of Business and Finance for Tennessee State University, and Director of Internal Audit for the Department of General Services. She has an undergraduate degree from David Lipscomb University and an MBA from Tennessee State University. The Company believes that Ms. Nelson's broad range of experience in accounting and management fields over the past 30 years make her a valuable member to the Board and the Board's audit committee. There is no family relationship between Ms. Nelson and any of the Company's directors or officers. A full-text copy of the Director Agreement is available for free at http://is.gd/azrdaj On July 31, 2011, Joseph Esposito resigned from his position on the Board pursuant to the expiration of his consultant agreement. About MedClean Technologies Based in Bethel, Connecticut, MedClean Technologies, Inc., provides solutions for managing medical waste on site including designing, selling, installing and servicing on site (i.e. "in- situ") turnkey systems to treat regulated medical waste. The Company's balance sheet at March 31, 2011, showed $1.8 million in total assets, $2.1 million in total liabilities, and a stockholders' deficit of $295,325. As reported in the TCR on April 6, 2011, Child, Van Wagoner & Bradshaw, PLLC, in Salt Lake City, Utah, expressed substantial doubt about the MedClean Technologies' ability to meet its obligations and to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred substantial recurring losses. MORGANS FOODS: Black Horse, et al., Do Not Own Common Shares ------------------------------------------------------------ In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Black Horse Capital LP and its affiliates disclosed that they do not own any shares of common stock of Morgan's Foods, Inc. A full-text copy of the filing is available for free at http://is.gd/29ZSeN About Morgan's Foods Cleveland, Ohio-based Morgan's Foods, Inc., which was formed in 1925, operates through wholly-owned subsidiaries KFC restaurants under franchises from KFC Corporation, Taco Bell restaurants under franchises from Taco Bell Corporation, Pizza Hut Express restaurants under licenses from Pizza Hut Corporation and an A&W restaurant under a license from A&W Restaurants, Inc. As of May 20, 2011, the Company operates 56 KFC restaurants, 5 Taco Bell restaurants, 10 KFC/Taco Bell "2n1's" under franchises from KFC Corporation and franchises from Taco Bell Corporation, 3 Taco Bell/Pizza Hut Express "2n1's" under franchises from Taco Bell Corporation and licenses from Pizza Hut Corporation, 1 KFC/Pizza Hut Express "2n1" under a franchise from KFC Corporation and a license from Pizza Hut Corporation and 1 KFC/A&W "2n1" operated under a franchise from KFC Corporation and a license from A&W Restaurants, Inc. Grant Thornton LLP, in Cleveland, Ohio, expressed substantial doubt about Morgan's Foods' ability to continue as a going concern. The independent auditors noted that as of Feb. 27, 2011, the Company was in default and cross default of certain provisions of its most significant credit agreements and in default of the image enhancement requirements under franchise agreements for certain of its restaurants. The Company reported a net loss of $988,000 on $89.9 million of revenues for the fiscal year ended Feb. 27, 2011, compared with net income of $396,000 on $90.5 million of revenues for the fiscal year ended Feb. 28, 2010. The Company's balance sheet at May 22, 2011, showed $43.03 million in total assets, $42.62 million in total liabilities and $418,000 in total shareholders' equity. MORGANS HOTEL: Inks $100MM Revolving Facility with Deutsche Bank ---------------------------------------------------------------- Morgans Group LLC, Beach Hotel Associates LLC and Morgans Hotel Group Co., as guarantor, entered into a secured Credit Agreement, with Deutsche Bank Securities Inc. as sole lead arranger, Deutsche Bank Trust Company Americas, as agent, and the lenders party thereto. The Revolving Credit Agreement provides commitments for a $100 million revolving credit facility and includes a $15 million letter of credit sub-facility. The maximum amount of those commitments available at any time for borrowings and letters of credit is determined according to a borrowing base valuation equal to the lesser of (i) 55% of the appraised value of the Delano Hotel and (ii) the adjusted net operating income for the Florida Property divided by 11%. Extensions of credit under the Revolving Credit Agreement are available for general corporate purposes. The commitments under the Revolving Credit Agreement may be increased by up to an additional $10 million during the first two years of the facility, subject to certain conditions, including obtaining commitments from any one or more lenders to provide those additional commitments. The commitments under the Revolving Credit Agreement terminate on July 28, 2014, at which time all outstanding amounts under the Revolving Credit Agreement will be due and payable. There are no loans currently outstanding under the Revolving Credit Agreement. The obligations of the Borrowers under the Revolving Credit Agreement are guarantied by the Company and Morgans Hotel Group Management LLC. Those obligations are also secured by a mortgage on the Florida Property and all associated assets of the Florida Borrower, as well as a pledge of all equity interests in the Florida Borrower. The interest rate applicable to loans under the Revolving Credit Agreement is a floating rate of interest per annum, at the Borrowers' election, of either LIBOR plus 4.00%, or a base rate plus 3.00%. In addition, a commitment fee of 0.50% applies to the unused portion of the commitments under the Revolving Credit Agreement. A full-text copy of the Form 8-K is available for free at: http://is.gd/ohiLHt About Morgans Hotel Group Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) -- http://www.morganshotelgroup.com/-- is widely credited as the creator of the first "boutique" hotel and a continuing leader of the hotel industry's boutique sector. Morgans Hotel Group operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and Shore Club in South Beach, Mondrian in Los Angeles and South Beach, Clift in San Francisco, Ames in Boston, and Sanderson and St Martins Lane in London. Morgans Hotel Group and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans Hotel Group also manages hotels in Isla Verde, Puerto Rico and Playa del Carmen, Mexico. Morgans Hotel Group has other property transactions in various stages of completion, including projects in SoHo, New York and Palm Springs, California. The Company reported a net loss of $83.64 million on $236.37 million of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $101.60 million on $225.05 million of total revenues during the prior year. The Company's balance sheet at June 30, 2011, showed $604.36 million in total assets, $655.66 million in total liabilities, and a $51.29 million total stockholders' deficit. NETWORK SOLUTIONS: Moody's Affirms B2 CFR; Outlook Stable --------------------------------------------------------- Moody's Investors Service affirmed Network Solutions, LLC's B2 Corporate Family Rating (CFR) and the ratings for the company's existing credit facilities, and revised the ratings outlook to stable, from negative. These ratings were affirmed: Issuer: Network Solutions, LLC Corporate Family Rating at B2 Probability of Default Rating at B2 $25 million secured revolver due 2013 at B1 (LGD3, 39%) -- point estimate revision from (LGD3, 43%) $383 million (approximately $199 million outstanding) first lien secured term loan due 2014 at B1 (LGD3, 39%) -- point estimate revision from (LGD3, 43%) Outlook actions: Outlook changed to stable from negative RATING RATIONALE The revision of ratings outlook to stable reflects Moody's expectations that Network Solutions will generate stable cash flow from operations driven by improving operating performance and that the company will maintain good liquidity. Moody's believes that Web.com's announced plans to acquire Network Solutions do not affect Network Solutions' ratings. Under the terms of the agreement, Network Solutions' debt will be repaid in full at the close of the acquisition, which is expected to occur during the fourth quarter, at which time the company's ratings will be withdrawn. Should the transaction not close as currently proposed, Network Solutions' stabilizing operating trends, good free cash flow generation and increased financial flexibility through debt repayment over the past several quarters would strongly position the company's CFR within the B2 rating category. The last rating action on Network Solutions was on September 3, 2009 when Moody's changed the rating outlook to negative from stable. The principal methodology used in rating Network Solutions was the Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Network Solutions, headquartered in Herndon, Virginia, is a provider of Internet domain name registration. In addition, the company provides a portfolio of web products and services to help customers maximize the value of that identity throughout its life cycle. NPS PHARMACEUTICALS: To Issue $150 Million of Securities -------------------------------------------------------- NPS Pharmaceuticals, Inc., may from time to time offer common stock, preferred stock, depositary shares, debt securities or warrants together or separately which together will have an aggregate initial offering price not to exceed $150,000,000. A full-text copy of the Form S-3 registration statement is available for free at http://is.gd/aRW7qZ In a separate filing, the Company registered with the Securities and Exchange Commission register an additional 4,650,000 shares of the Company's common stock, $0.001 par value per share reserved for issuance under the Company's 2005 Omnibus Incentive Plan. A full-text copy of the Form S-8 registration statement is available for free at http://is.gd/sTOzY5 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 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. The Company's balance sheet at June 30, 2011, showed $253.27 million in total assets, $280.58 million in total liabilities, and a $27.31 million total stockholders' deficit. OMNICARE INC: Moody's Affirms Ba3 CFR; Outlook Negative ------------------------------------------------------- Moody's Investors Service assigned Baa3 ratings to Omnicare, Inc.'s new $450 million unsecured Term Loan A and its new $300 million unsecured revolver. The ratings are subject to Moody's review of final documentation. At the same time, all existing ratings were affirmed, including Omnicare's Ba3 CFR and PDR as well as its SGL-1 speculative grade liquidity rating. The rating outlook remains negative. Proceeds from this transaction are expected to be used to partially take out the company's $525 million in callable 6.875% senior subordinated notes, due 2015. Moody's expects to withdraw the rating on the 2015 notes once they are fully repaid. Ratings assigned: Omnicare, Inc. New $450 million unsecured Term Loan A at Baa3, LGD2, 14% New $300 million unsecured revolver at Baa3, LGD2, 14% Ratings affirmed: Omnicare, Inc. Corporate Family Rating at Ba3 Probability of Default Rating at Ba3 Senior subordinated notes at Ba3, LGD4, 53% from Ba3, LGD3, 44% Convertible senior notes at B2, LGD5, 84% from B2, LGD5, 85% SGL-1 Speculative Grade Liquidity Rating Omnicare Capital Trust I PIERS Trust Preferreds at B2, LGD6, 94% Omnicare Capital Trust II PIERS Trust Preferreds at B2, LGD6, 94% Rating withdrawn: $400 million secured revolver at Baa3, LGD1, 6% RATINGS RATIONALE The Ba3 CFR incorporates Moody's expectation that the company will continue to see improvements in operating performance. Because of uncertainty associated with the reimbursement environment for long-term care pharmacy operators, the ratings assume that Omnicare's credit metrics will trend toward those above a "Ba3" rating level, including debt/EBITDA below 3.5 times. The negative outlook reflects Moody's concerns that despite some recent stabilization, fundamental operating conditions, including declining bed counts, competitive pricing pressures and the potential for negative effects from recent cuts in nursing home reimbursement rates, may not result in metrics that are in line with Moody's expectations for the Ba3 rating. For the twelve months ended June 30, 2011, debt/EBITDA is estimated at 4.3 times. Moody's expects the company to continue to focus on implementing new operating initiatives, including standardized practices to help boost customer retention rates and efficiency. In addition, Moody's understands that Omnicare will seek to reposition its specialty business for better growth. Moody's views the appointment of John Figueroa as CEO favorably, especially in light of his senior experience at one of the nation's largest drug distributors. However, the transition to a new CEO provides some uncertainty associated with future strategic initiatives and financial policies. If the company's operating performance deteriorates due to declining bed and script trends or material changes in reimbursement, or, if deleveraging does not occur because of acquisition activity and debt/EBITDA is sustained above 3.75 times, the ratings could be downgraded. If, however, Omnicare is able to continue to address operating issues and can realize better cushions in its metrics to help offset reimbursement uncertainties, the outlook could return to stable. If the company is able to continue to show improvement in bed and script volume and successfully weather potential reimbursement changes such that credit metrics can be sustained in at least the high-"Ba" range, including debt/EBITDA at or below 2.5 times, the ratings could be upgraded. Omnicare, Inc.'s ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Omnicare, Inc.'s core industry and believes Omnicare, Inc.'s ratings are comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Omnicare, Inc. (OCR), headquartered in Covington, Kentucky, is the leading provider of institutional pharmacy services to the long term care sector. OMNICARE INC: S&P Affirms 'BB' Corporate Credit Rating ------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'BBB-' issue-level rating and '1' recovery rating to Covington, Ky.-based Omnicare Inc.'s proposed $750 million senior unsecured credit facility, consisting of a $300 million revolving credit facility and a $450 million term loan A. The company intends to use the proceeds from the term loan A to redeem at least $425 million of its $525 million 6.875% senior subordinated notes due 2015. "Finally, we affirmed our existing ratings on Omnicare, including our 'BB' corporate credit rating on the company. The outlook is stable," S&P related. "Our ratings on Omnicare reflect the company's fair business risk profile and significant financial risk profile; the business risk profile continues to reflect the company's narrow business focus, exposing it to industry-specific risks, such as the potential for future reimbursement pressure," said Standard & Poor's credit analyst Jesse Juliano. "In addition, Omnicare has experienced a number of operating shortfalls since its debt-financed acquisition of NeighborCare Inc. in 2005, and the 2006 implementation of Medicare Part D. Also, Omnicare has experienced a decline in the number of beds served over the past few years. However, we do expect the trend in beds served could improve in 2011 through acquisitions and an increased focus on customer service. Risks to Omnicare are partially offset by the company's opportunity to capitalize on its leading position as a provider of pharmacy services to nursing homes and other long-term care providers, and its ability to generate free cash flow despite numerous operating hurdles over the past few years. We expect the company to generate roughly $425 million of operating cash flow in 2011." Omnicare achieved its leading market position through a long series of acquisitions. The company leverages this larger size to achieve operational economies of scale and improve its purchasing clout with pharmaceutical manufacturers. Given its broad industry presence, it would be difficult for any national managed care company to serve its nursing home and long-term care members without operating through Omnicare. ORESTES & MELODY: Meeting to Form Committee on Thursday ------------------------------------------------------- Roberta DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on Aug. 11, 2011, at 9:30 a.m. in the bankruptcy case of Orestes & Melody Sanchez. The meeting will be held at: United States Trustee's Office One Newark Center 1085 Raymond Blvd. 21st Floor, Room 2106 Newark, NJ 07102 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Orestes and Melody Sanchez filed a joint Ch. 11 petition (Bankr. D. N.J Case No. 11-31416) on July 18, 2011. PACIFIC LUMBER: Buyers Wins Appeals Court Reversal $29.7MM Order ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the purchasers of Scotia Pacific Co. and affiliate Pacific Lumber Co. persuaded three judges on the U.S. Court of Appeals in New Orleans to reverse their own opinion from October which told the buyers in substance that they had to pay $29.7 million more for the California timberland business. According to the report, Marathon Structured Finance Fund LP and Mendocino Redwood Co. bought Scotia and Palco under a Chapter 11 plan for $580 million in cash and the conversion of $160 million of debt into equity. In last year's opinion, Chief Judge Edith H. Jones from the 5th Circuit in New Orleans overturned the two lower courts and in substance told the buyers they must pay an extra $29.7 million because the bankruptcy judge made a mistake in calculating the amount owed to secured lenders for use of their collateral during the Chapter 11 case. Mr. Rochelle relates that in a four-page opinion Aug. 4 revising the original ruling, Judge Jones said she didn't mean to imply that the lower courts "had no choice" but to require payment of the entire $29.7 million. She said that "partial recovery may be justified if necessary to avert the concerns of the equitable mootness doctrine." In the new ruling, Judge Jones said the entire amount need not be paid if it would "undermine the plan" or "jeopardize the reorganized debtor's financial health." Mr. Rochelle notes that the Scotia-Palco case is the second this year in which a bankruptcy opinion by Judge Jones has been under attack. About Pacific Lumber Based in Oakland, California, The Pacific Lumber Company and its subsidiaries operated in several principal areas of the forest products industry, including the growing and harvesting of redwood and Douglas-fir timber, the milling of logs into lumber and the manufacture of lumber into a variety of finished products. Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned subsidiaries of Pacific Lumber. Scotia Pacific, Pacific Lumber's largest operating subsidiary, was established in 1993, in conjunction with a securitization transaction pursuant to which the vast majority of Pacific Lumber's timberlands were transferred to Scotia Pacific, and Scotia Pacific issued Timber Collateralized Notes secured by substantially all of Scotia Pacific's assets, including the timberlands. Pacific Lumber, Scotia Pacific, and four other subsidiaries filed for chapter 11 protection (Bankr. S.D. Tex. Case Nos. 07-20027 through 07-20032) on Jan. 18, 2007. Jack L. Kinzie, Esq., at Baker Botts LLP, is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan, Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead counsel. Kyung S. Lee, Esq., at Diamond McCarthy LLP, is Scotia Pacific's co-counsel, replacing Porter & Hedges LLP. John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Official Committee of Unsecured Creditors. When Pacific Lumber filed for protection from its creditors, it estimated assets and debts of more than $100 million. Scotia Pacific disclosed total assets of $932,000,000 and total debts of $765,978,335. The Debtors filed their Joint Plan of Reorganization on Sept. 30, 2007, which was amended on Dec. 20, 2007. Four other parties-in- interest filed competing plans for the Debtors -- The Bank of New York Trust Company, N.A., as Indenture Trustee for the Timber Notes; the Official Committee of Unsecured Creditors; Marathon Structured Finance Fund L.P, the Debtors' DIP Lender and Agent under the DIP Credit Facility; and the Heartlands Commission, which represents the tribal members of the Bear River Band of Rohnerville Rancheria and PALCO employees. On July 8, 2008, the Court confirmed the Modified First Amended Joint Plan of Reorganization With Technical Modifications for the Debtors, which was proposed by Marathon Structured Finance Fund L.P., Mendocino Redwood Company, LLC, and the Official Committee of Unsecured Creditors. The Debtors emerged from bankruptcy protection on July 30, 2008. The Reorganized Entities have been renamed as Humboldt Redwood Co., under the management of Mendocino Redwood. PACIFICUS REAL: Files Schedules of Assets and Liabilities --------------------------------------------------------- PacificUS Real Estate Group filed with the U.S. Bankruptcy Court for the Central District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $19,300,000 B. Personal Property $10,827,898 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $6,226,295 E. Creditors Holding Unsecured Priority Claims $173,425 F. Creditors Holding Unsecured Non-priority Claims $7,182,795 ----------- ----------- TOTAL $30,127,898 $13,582,515 About Pacificus Real Estate PacificUS Real Estate Group, based in Pasadena, California, owns various real estate properties, including the "SilverTip Property"located at the south entrance of Yosemite National Park. It filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-40120) on July 14, 2011. Judge Ernest M. Robles presides over the case. The Debtor is represented by Ron Bender, Esq., at Levene, Neale, Bender, Yoo & Brill, LLP. In its petition, the Debtor estimated assets and debts of $10 million to $50 million. The petition was signed by Paul J. Giuntini, its president. PacificUS said it intends to reorganize through a sale of -- or a joint venture to develop -- the SilverTip Property. PERRY COUNTY: Fitch Withdraws 'BB' Rating on Revenue Bonds ---------------------------------------------------------- Fitch Ratings has withdrawn the 'BB' rating on the Indiana Finance Authority (IN) (Perry County Memorial Hospital) hospital revenue bonds series 2010 as the bond was not sold. PETROHUNTER ENERGY: Incurs $1.4-Mil. Net Loss in June 30 Quarter ---------------------------------------------------------------- Petrohunter Energy Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $1.37 million for the three months ended June 30, 2011, compared with a net loss of $2.11 million for the same period during the prior year. The Company also reported a net loss of $4.05 million for the nine months ended June 30, 2011, compared with a net loss of $6.15 million for the same period a year ago. The Company's balance sheet at June 30, 2011, showed $1.16 million in total assets, $67.38 million in total liabilities and a $66.22 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/UxmlFT About PetroHunter Energy Denver, Colo.-based PetroHunter Energy Corporation is an oil and gas exploration company. The Company currently owns oil and gas leasehold interests either directly or through an equity investment in Australia (Beetaloo Basin) and in Western Colorado (Piceance Basin). As reported in the Troubled Company Reporter on Dec. 28, 2010, Eide Bailly LLP, in Greenwood Village, Colo., expressed substantial doubt about PetroHunter Energy'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 an accumulated deficit of $286.0 million and net loss of $6.8 million for the year ending Sept. 30, 2010, and as of that date, has a working capital deficit of $11.3 million. PICHIS INC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Pichis, Inc. P.O. Box 560115 Guayanilla, PR 00656-0560 Bankruptcy Case No.: 11-06583 Chapter 11 Petition Date: August 3, 2011 Court: United States Bankruptcy Court District of Puerto Rico (Ponce) Debtor's Counsel: Charles Alfred Cuprill, Esq. CHARLES A CURPILL, PSC LAW OFFICE 356 Calle Fortaleza Second Floor San Juan, PR 00901 Tel: (787) 977-0515 E-mail: cacuprill@cuprill.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Luis A. Emmanuelli Gonzalez, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Caribe General Construction $1,164,256 Constructors Contractors 2053 Ponce By Pass Suite 201 Ponce PR00717 1308 CRIM Real Property Tax $787,875 P.O. Box 70235 San Juan, PR 00936 8235 Bally Technologies Gaming systems; Lease $565,652 Lockbox 749335 Los Angeles CA 90074 Departamento De Hacienda Payroll Tax $260,564 De PR Witholdings Bankruptcy Section (424B) PO Box 9024140 San Juan PR 00902 4140 Aristrocat Technologies Lease of Equipment $252,208 Inc. 7230 Amigo Street Las Vegas NV 89119 Departamento De Hacienda Sales and Use Tax $177,475 De PR PR Electric Power Electric Power $156,641 (PREPA) Aut Services State Insurance Fund Workmen's Compensation $147,325 Corp. Insurance Atronic International Lease of Equipment $136,320 WMS Gaming Corporate Financing Equipment $104,263 Receipts Internal Revenue Payroll Tax $93,090 Services Witholdings Best Western Hotel Franchise Fees $84,615 International HMS Gaming LLC Konami Machines $76,515 Banco Popular De Credit Card Purchases $47,642 Puerto Rico Visa Compa�a De Turismo De Room Tax $36,516 PR Lavanderias Del Sur Laundry Services $33,595 Reel Games Inc. Lease of Equipment $33,480 Departamento Del Trabajo Payroll Tax $31,983 Y Recursos Humanos Manuel A. Nu�ez, Esq. Legal Services $29,843 Capitol Security Police Security Services $27,866 Inc. PLATINUM PROPERTIES: Wants Until Dec. 21 to File Chapter 11 Plan ---------------------------------------------------------------- Platinum Properties, LLC, and PPV, LLC, ask the U.S. Bankruptcy Court for the Southern District of Indiana to extend their exclusive periods to file and solicit acceptances for the proposed plan of reorganization until Dec. 21, 2011, and Feb. 21, 2012, respectively. Absent the extensions, the Debtors' initial exclusive filing period and exclusive solicitation period will expire on Aug. 23, and Oct. 24, respectively. The Debtors require more time to formulate a viable reorganization plan. The Debtors are working to arrive at a consensual plan or, barring that, a plan that satisfies all confirmation requirements of section 1129 of the Bankruptcy Code. About Platinum Properties and PPV LLC Indianapolis, Indiana-based Platinum Properties, LLC, is a residential real estate developer. Platinum acquires land, designs the projects, obtains zoning and other approvals, and constructs roads, drainage, utilities, and other infrastructure of residential subdivisions. Platinum then sells the finished, platted lots. Platinum also has an ownership interest in several special purpose entities that in turn own, operate and manage individual projects. PPV LLC is a joint venture between Platinum and a non-debtor entity, Pittman Partners, Inc., each of whom hold an equity interest in PPV. PPV owned four projects directly and owns 100% of the membership interest of Sweet Charity Estates, LLC. Platinum Properties and PPV LLC filed for Chapter 11 protection (Bankr. S.D. Ind. Case Nos. 11-05140 and 11-05141) on April 25, 2011. Lawyers at Baker & Daniels serve as the Debtors' bankruptcy counsel. Platinum Properties disclosed $14,624,722 in assets and $181,990,960 in liabilities as of the Chapter 11 filing. The U.S Trustee has not yet appointed a creditors committee in the Debtor's case. The U.S. Trustee reserves the right to appoint such a committee should interest developed among the creditors. PMI MORTGAGE: S&P Lowers Counterparty Credit Rating to 'CCC-' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its counterparty credit and financial strength ratings on PMI Mortgage Insurance Co. (PMI) to 'CCC-' from 'B-'. "At the same time, based on standard notching, we lowered our counterparty credit and senior debt ratings on PMI's holding company, The PMI Group Inc. (TPG), one notch to 'CC' from 'CCC-'. The outlook is negative," S&P related. "In our July 5, 2011, press release, we noted that PMI had become subject to further adverse reserve development relating to its expectations of future claim denial reversals. Further, we indicated that PMI would be subject to a one or more notch downgrade following any significant adverse deviations in operating results. PMI recorded a net operating loss of $338.4 million for the second quarter of 2011. The excess losses were a result of a $242.6 million increase in reserves caused primarily by a decrease in expected future claim denials net of reversals. Moreover, we believe PMI remains highly vulnerable to further adverse reserve development over the next 12 months," S&P said. "Given PMI's estimated statutory capitalization of $257.8 million at the end of second-quarter 2011, we believe statutory insolvency is possible by the end of 2011 or in early 2012," said Standard & Poor's credit analyst Miles Kaschalk. "Further, we believe PMI could be placed into regulatory supervision or court-ordered receivership by the Arizona Department of Insurance at or before the occurrence of statutory insolvency. Under the indenture governing an aggregate of $685 million of debt securities, this receivership would constitute an event of default." "The rating outlook on PMI is negative based on our expectation that PMI's 2011 and 2012 operating results will further erode its statutory capital position. We will lower the rating further as the potential of regulatory takeover and/or statutory insolvency becomes more likely," S&P said. POST STREET: Amends Schedules of Assets and Liabilities ------------------------------------------------------- Post Street, LLC, filed with the U.S. Bankruptcy Court for the Northern District of California amended schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property Unknown B. Personal Property $280,815 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $55,028,579 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $1,064,273 ----------- ----------- TOTAL $280,815 $56,092,852 + Unknown A full-text copy of the Amended Schedules is available for free at http://bankrupt.com/misc/POSTSTREET_amended_sal.pdf In its original schedules, the Debtor disclosed assets of $3,316 plus unknown amount and liabilities of $55,906,564. About Post Street LLC Post Street LLC, based in San Francisco, California, filed for Chapter 11 bankruptcy (Bankr. Case No. 11-32255) on June 15, 2011. Judge Thomas E. Carlson presides over the case. Eric D. Goldberg, Esq., at Stutman, Treister and Glatt, serves as the Debtor's bankruptcy counsel. The Debtor disclosed assets of $3,316 plus unknown amount and liabilities of $55,906,564 as of the Chapter 11 filing. The petition was signed by Stanley W. Gribble, authorized agent. PRECISION OPTICS: Sells IP to Intuitive for $2.5 Million -------------------------------------------------------- Precision Optics Corporation, Inc., on July 28, 2011, entered into an asset purchase agreement with Intuitive Surgical Operations, Inc., in which the Company received $2.5 million in connection with the sale of certain intellectual property. Pursuant to the Agreement, the Company assigned all of its currently issued and pending patents to Intuitive Surgical. As part of the Agreement, Intuitive Surgical agreed to grant the Company a royalty-free, paid-up, worldwide, transferrable, subject to certain limitations, non-exclusive license to directly and indirectly make, use, develop, modify, improve, substitute, iterate, combine, distribute, offer for sale, and sell, import and export products outside the field of medical robotics throughout countries worldwide. Intuitive Surgical also agreed to certain restrictions on the granting of additional licenses outside the field of medical robotics. Intuitive Surgical also agreed to grant the Company a royalty- free, paid-up, worldwide, transferrable, subject to certain limitations, non-exclusive license to directly and indirectly make, use, develop, modify, improve, substitute, iterate, combine, distribute, offer for sale, and sell, import and export products and services for in vitro procedures utilizing genomic or proteomic lab-on-a-chip or other similar benchtop diagnoses, both inside and outside the field of medical robotics throughout countries worldwide. On July 27, 2011, the Company entered into an amendment with certain accredited investors to amend the Pledge and Security Agreement, dated June 25, 2008, to allow the Company to enter into the Agreement with Intuitive Surgical. On June 25, 2008, the Company entered into a Purchase Agreement, as amended on December 11, 2008, with certain accredited investors pursuant to which the Company sold an aggregate of $600,000 of 10% Senior Secured Convertible Notes. The Investors amended the Notes on several dates to extend the "Stated Maturity Date" of the Notes. On July 27, 2011, the Investors further amended the Notes to extend the "Stated Maturity Date" to Aug. 31, 2011. The Investors also amended the Notes to allow the Company to enter into the Agreement with Intuitive Surgical. About Precision Optics 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. 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. QUINCY MEDICAL: Files Schedules of Assets and Liabilities --------------------------------------------------------- Quincy Medical Center, Inc., filed with the U.S. Bankruptcy Court District of Massachusetts its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $23,854,337 B. Personal Property $47,360,193 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $63,890,030 E. Creditors Holding Unsecured Priority Claims $4,242,652 F. Creditors Holding Unsecured Non-priority Claims $13,186,732 ----------- ----------- TOTAL $71,214,530 $81,319,414 About Quincy Medical Center Quincy Medical Center is a 196-bed, nonprofit hospital in Quincy, Massachusetts. Quincy Medical Center, Inc. together with two affiliates, sought Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16394) on July 1, 2011. John T. Morrier, Esq., at Casner & Edwards, LLP, in Boston, serves as counsel to the Debtors. Navigant Capital Advisor LLC and Navigant Consulting Inc. serve as financial advisors. Epiq Bankruptcy Solutions LLC is the claims, noticing, and balloting agent. Mark O'Neill appointed as new chief executive officer. Quincy disclosed assets of $73 million and liabilities of $79.4 million. Debt includes $56.4 million owing on secured bonds issued through a state health-care finance agency. There is another $2.5 million secured obligation owing to Boston Medical Center Corp. Accrued liabilities are $18.2 million. QUINCY MEDICAL: Needs to Have Winning Bidder by Aug. 17 ------------------------------------------------------- On Aug. 1, 2011, the U.S. Bankruptcy Court for the District of Massachusetts amended its interim order [Docket No. 60] extending Quincy Medical Center, Inc., and its affiliated debtors' right to use cash collateral of the Prepetition Secured Parties through Aug. 12, 2011, which is also the date of the final hearing on the Debtors' cash collateral motion. Absent the amendment, the Debtor's right to use cash collateral will terminate on Aug. 1, 2011. The Court also extends to Aug. 3, 2011, the date by which the Company must file a plan of liquidation, and to Aug. 17, 2011, the date by which the Company must obtain entry of a order identifying the "Winning Bidder" under the sale procedures approved by the Court, which extended deadline coincides with the date of the Aug. 17, 2011 hearing scheduled by the Court for than purpose. About Quincy Medical Center Quincy Medical Center is a 196-bed, nonprofit hospital in Quincy, Massachusetts. Quincy Medical Center, Inc. together with two affiliates, sought Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16394) on July 1, 2011. John T. Morrier, Esq., at Casner & Edwards, LLP, in Boston, serves as counsel to the Debtors. Navigant Capital Advisor LLC and Navigant Consulting Inc. serve as financial advisors. Epiq Bankruptcy Solutions LLC is the claims, noticing, and balloting agent. Mark O'Neill appointed as new chief executive officer. In its schedules, the Debtor listed $71,214,530 in assets and $81,319,414 in liabilities as of the petition date. RANCHO CUCAMONGA: Involuntary Chapter 11 Case Summary ----------------------------------------------------- Alleged Debtor: Rancho Cucamonga Harry's Pacific Grill. LLC aka Harry's Pacific Grill, LLC 339 N. Hwy #101 Solana Beach, CA 92075 Case Number: 11-12992 Involuntary Chapter 11 Petition Date: August 2, 2011 Court: Southern District of California (San Diego) Judge: Margaret M. Mann Creditors who signed the Chapter 11 petition: Petitioner Nature of Claim Claim Amount ---------- --------------- ------------ CanAm Partners LLC Consulting Agreement $100,000 G.A. Harrington, mgr. 300-400 Richard St. Vancouver, BC V6B2Z4 United Coastal Loans $50,000 Group, LLC Caysee Haywood, MGR 1616 17th St. #268 Denver, CO 80202 Entrust Metal Advisors, Loans $10,000 Inc. S.A. Strickland, mgr 4737 N. Ocean Dr. Ft. Lauderdale, FL 33308 REICHMANN PETROLEUM: ConocoPhillips Sued Over Unpaid Revenues ------------------------------------------------------------- Roxanne Palmer at Bankruptcy Law360 reports that ConocoPhillips Co. was hit with a breach of contract lawsuit Friday in Texas court accusing the oil giant of failing to pay revenues owed on several gas leases acquired by MSB Energy Inc. from Reichmann Petroleum Corp. MSB bought the leases from Reichmann after the company's Chapter 11 reorganization plan was confirmed by a Texas bankruptcy court in May 2008, according to a complaint filed by Baytex Credit Corp. Reichmann Petroleum Corp., based in Grapevine, Tex., sought Chapter 11 protection (Bankr. S.D. Tex. Case No. 06-60843) on Dec. 8, 2006, represented by Patrick J. Neligan, Jr., Esq., at Neligan, Andrews & Foley, LLP, in Dallas, Tex., and estimating its assets and debts at less than $100 million. Reichmann Petroleum filed a Chapter 11 Plan of Reorganization on June 27, 2007, and the Bankruptcy Court confirmed the Company's Second Amended Plan of Reorganization on May 2, 2008. REVIVAL OUTREACH: Court Wants Changes to Plan Outline ----------------------------------------------------- Bankruptcy Judge Thomas J. Tucker found another set of flaws in the Amended Combined Plan and Disclosure Statement filed by Revival Outreach Center International Church on July 26, 2011, and directed the Debtor to subject a revised disclosure statement by Aug. 2. A copy of Judge Tucker's July 31, 2011 Order is available at http://is.gd/bHKigcfrom Leagle.com. As reported by the Troubled Company Reporter on July 27, 2011, Judge Tucker said he cannot yet grant preliminary approval of the disclosure statement explaining the Combined Plan and Disclosure Statement filed by the Debtor on July 8, 2011, citing a laundry- list of problems that the Debtor must correct. The amendments were due to be filed July 21, 2011. A copy of Judge Tucker's prior Order is available at http://is.gd/cqsmtPfrom Leagle.com. About Revival Outreach Center International Church Revival Outreach Center International Church, based in Royal Oak, Michigan, filed a Chapter 11 petition (Bankr. E.D. Mich. Case No. 11-46419) on March 10, 2011. Judge Thomas J. Tucker oversees the case. Erica J. Ehrlichman, Esq. -- erica@findlinglaw.com -- at The Findling Law Firm PLC serves as bankruptcy counsel. In its petition, the Debtor estimated assets and debts between $1 million and $10 million. The petition was signed by David Findling, special restructuring officer. RHODE ISLAND: Moody's Reviews Ba1 Rating for Possible Downgrade --------------------------------------------------------------- Moody's Investors Service has placed on review for possible downgrade the Ba1 rating assigned to Rhode Island Health and Educational Building Corporation's (RIHEBC) Public Schools Revenue Financing Program Revenue Bonds, Series 2007B (Pooled Issue), affecting $17.19 million in outstanding debt. SUMMARY RATING RATIONALE The rating action recognizes the recent action on Central Falls Caa1 general obligation rating, which was recently placed on review for possible downgrade. RIHEBC's 2007B bond issue is an unenhanced pool and rated using a 'weak link plus' approach, with Central Falls being the lowest-rated among the pool's participants. The Ba1 pooled financing rating incorporates Central Falls' Caa1 GO rating as well as the city's limited (6.6%) portion of the pool. The significant amount of debt service (34.22%) directly paid to RIHEBC by the state and the availability of the State of Rhode Island's (GO rated Aa2/negative outlook) intercept of state aid for the remainder of the participants' debt service provide strong additional security and lifts the pool rating above the weakest link rating of Caa1. Despite this, Central Falls' liquidity is strained and the city faces severe budgetary structural imbalance. Furthermore, the timing and outcome of bankruptcy proceedings are uncertain, increasing the risk of nonpayment to RIHEBC by Central Falls. The rating has been placed on review pending the outcome of the review of Central Falls' general obligation rating. For more information on the City of Central Falls' rating please refer to Moody's recent credit reports dated June 17, 2011 and August 2, 2011. Additional factors incorporated in the Ba1 rating are the strong mechanics, included in the RIHEBC pool agreement, historical state support for school construction projects, and RIHEBC's ability to intercept certain state aid related to construction of school facilities. Proceeds from the 2007B bonds were originally loaned to four local units of government to fund various school capital improvement projects. STRENGTHS - Above average credit quality of majority of pool participants - Direct payment by the state of majority of participants' debt service - Availability of state intercept program for remainder of participants' debt service - Strong program mechanics including participant loan payment due date 45 days prior to debt service payment CHALLENGES - Severely weak credit quality and bankruptcy of Central Falls - Lack of shared debt service reserve or step-up provisions DETAILED CREDIT DISCUSSION PROGRAM STRUCTURE AND LEGAL SECURITY The Series 2007 B Bonds are special obligations of the Rhode Island Health and Educational Building Corporation (RIHEBC), secured solely by the loan payments from the pool's borrowers under their respective financing agreements. Loan repayments, which are due under each financing agreement are scheduled to be sufficient to pay the borrower's proportionate share of the principal, sinking fund installments and redemption price of and interest on the Series 2007 B Bonds, from the proceeds from which each borrower will receive a loan. With this series of bonds, each borrower will privately place its general obligation unlimited tax bond with RIHEBC. There is no cross collateralization or cross default, therefore no borrower is responsible for the loan repayments of any other borrower and default of one borrower will not constitute default of any other borrowers. While RIHEBC does not have a debt service reserve for the 2007 B bonds, each borrower is required, under the series indenture, to establish a debt service fund sufficient to cover semi-annual debt service payments. The percentage participation of each borrower is as follows: Town of Tiverton - 54.22%, Town of North Kingstown - 35.47%, City of Central Falls - 6.59% and the Town of Barrington - 3.72%. The general funds of RIHEBC are not pledged to any bonds, nor is the State of Rhode Island obligated in any form. STATE INTERCEPT AVAILABLE FOR RHODE ISLAND HEALTH AND EDUCATIONAL BUILDING CORPORATION OBLIGATIONS Moody's takes into account that certain state aid related to the construction of school facilities can be intercepted by the trustee for debt service payments. State housing aid attributable to the school projects financed with this issue will be paid directly to the trustee without further notification (direct payment approach) and when received by the trustee, will be forwarded to the respective borrower if the borrower has made its full loan payment. RIHEBC also has the ability to intercept a borrower's state housing aid payments on previously issued and outstanding bonds (interceptable aid), should a borrower default on a payment obligation to the corporation. Loan repayments (full debt service payment) on the Series 2007 B Bonds are to be paid by each borrower on April 1 and October 1, which is 45 days prior to the date on which principal and interest is due on the Series 2007 B Bonds. In the event of a payment default, RIHEBC will, within five business days after payments are due from the borrower, send a written delinquency notice to the Office of the General Treasurer, stating the name of the borrower in default and the amount of such delinquency. Once the General Treasurer has received written notice of delinquency, he shall deduct the amount listed in the notice, from the borrower's state housing aid, and pay such available amounts directly to the trustee via wire. The General Treasurer will make such payments, to the extent available from appropriated State Housing Aid, no later than five business days prior to the principal and interest payment dates for the Series 2007 B Bonds (May 15th and November 15th). While total interceptable aid well exceeds loan repayments net of state housing aid (net loan obligations) to be paid directly to the trustee due in some years for some of the pool participants, there are some years during which interceptable aid is less than the net loan obligation due from a particular pool participant. WHAT COULD MOVE THE RATING UP: - Upgrade of Central Falls' general obligation rating - Enhanced security provided by debt service reserve fund or step- up provision WHAT COULD MOVE THE RATING DOWN: - Downgrade of Central Falls' GO rating - Discontinuation of state intercept KEY STATISTICS FOR POOL: Town of Tiverton - unrated, 54.2% of pool Town of North Kingstown - GO rated Aa2, 35.5% of pool City of Central Falls - GO rated Caa1/rating under review for possible downgrade, 6.6% of pool Town of Barrington - GO rated Aa1, 0.37% of pool Public Schools Series 2007B Debt Outstanding: $17.19 million The principal methodology used in this rating was Moody's Approach to Rating U.S. Municipal and Not-For-Profit Pool Financings published in May, 2010. RIVER EAST: Judge Eugene R. Wedoff Resumes Case Assignment ---------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois informed River East Plaza, LLC, that effective Aug. 2, 2011, Judge Eugene R. Wedoff, at his request, will resume sitting on cases assigned to him. Pursuant to the Court rules, Judge Jack B. Schmetterer will no longer have responsibility for the LNV motion to modify stay. The counsels are advised to appear before Judge Wedoff to receive directions as to the motion. As reported in the Troubled Company Reporter on July 13, 2011, Chief Judge Carol A. Doyle transferred the Chapter 11 case of the Debtor to Judge Eugene R. Wedoff. The case was previously assigned to Judge Bruce W. Black. About River East Plaza, LLC Chicago, Illinois-based River East Plaza, LLC, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 11-05141) on Feb. 10, 2011. Michael E. Gosman, Esq., at Whyte Hirschboeck Dudek S.C., serves as the Debtor's bankruptcy counsel. The Debtor disclosed $19,410,255 in assets and $45,268,651 in liabilities as of the Chapter 11 filing. ROTHSTEIN ROSENFELDT: Investors Suit v. TD Bank Sent to Fla. Court ------------------------------------------------------------------ Magistrate Judge Mark Falk granted TD Bank N.A.'s request to transfer to the United States District Court for the Southern District of Florida pursuant to 28 U.S.C. Sec. 1404(a), the venue of the lawsuit commenced by victims of Scott W. Rothstein's fraud. Platinum Partners Value Arbitrage Fund, L.P., Centurion Structured Growth, LLC, and Level 3 Capital Fund, L.P., v. TD Bank, N.A., Civil Action No. 10-6457 (D. N.J.), was commenced Dec. 13, 2010, to recover more than $100 million lost in the highly publicized, large-scale Ponzi scheme perpetrated by imprisoned former Florida lawyer Scott W. Rothstein through the now bankrupt Florida law firm of Rothstein, Rosenfeldt, Adler, PA. The Rothstein scheme involved offering potential investors and lenders the opportunity to purchase stakes in structured settlements allegedly secured by Mr. Rothstein and RRA. Mr. Rothstein would inform the investors and lenders that the settlement details were confidential, but that the settlement funds were being held in escrow accounts at a TD Bank in South Florida. To put investors and lenders at ease, Mr. Rothstein allowed would-be investors to review TD Bank escrow account statements to confirm the amount of settlement funds available. In 2009, Mr. Rothstein's scheme imploded. It was revealed that the structured settlements Mr. Rothstein had purportedly secured were essentially fictional. In November 2009, Mr. Rothstein pleaded guilty to criminal racketeering, fraud, and money laundering, and he is presently serving a 50 year sentence in federal prison in Florida. The Complaint alleges that they loaned hundreds of millions of dollars to Florida investment firm Banyon 1030-32 for the purposes of investing in the proceeds of settlements allegedly secured by Mr. Rothstein and RRA. The Plaintiffs claim they only loaned the money to Banyon to invest in the Rothstein scheme after conducting due diligence, including traveling to TD Bank in Florida to review escrow account statements. The Plaintiffs allege that, during these visits, they were provided with bank statements and cover letters generated by at least three different TD Bank employees confirming amounts contained in RRA's trust accounts. The Plaintiffs claim that these statements were false, and that TD Bank, through its representatives, negligently or fraudulently misrepresented the security of the escrow accounts and their balances, thereby facilitating the scheme and defrauding the Plaintiffs into investing in the phantom settlements. A copy of Judge Falk's Aug. 2, 2011 Opinion is available at http://is.gd/LGLo6Ufrom Leagle.com. As reported by the Troubled Company Reporter on July 28, 2011, Herbert Stettin, the Chapter 11 trustee liquidating RRA filed a lawsuit against Toronto-Dominion Bank for allegedly not only ignoring numerous red flags raised by Mr. Rothstein's banking practices but for also allowing Mr. Rothstein's $1.2 billion-plus fraud to grow as big and last as long as it did. About Rothstein Rosenfeldt Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA -- http://www.rra-law.com/-- has been suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed Nov. 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non- existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on Jan. 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. On June 10, 2010, Mr. Rothstein was sentenced to 50 years in prison. SEAHAWK DRILLING: Anthion Master Fund Owns 5.07% of Common Shares ----------------------------------------------------------------- Anthion Master Fund, L.P., et al., disclose that as of July 27, 2011, they may be deemed to beneficially owns 606,825 of Seahawk Drilling, Inc.'s Common Stock, par value $0.01 per share, representing 5.07% of the issuer's common stock outstanding. The other reporting persons are Anthion Management LLC, the investment advisor to Anthion Master Fund, L.P., and David Moradi, the Managing Member of Anthion Management, LLC. A copy of the Schedule 13G is available at http://is.gd/gYI4ml 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 Jonathan 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 Jordan, 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. SIGNATURE STYLES: Has Approval for Reinstatement on Google ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the owner of the Spiegel catalog was given permission by the bankruptcy court this week to pay the $890,000 it owed to Google Inc. As a result, the company's advertisements will reappear adjacent to search results when a Google user makes a search using specified words. According to the report, Google stopped running Spiegel advertisements when the catalog filed for Chapter 11 leaving $890,000 unpaid. The authority to pay the pre-bankruptcy unsecured debt was on the condition that Google give the catalogue terms not less favorable than those before Chapter 11. Spiegel also has the right to contest the amount properly owing. The report relates that to justify paying unsecured debt, the catalog said the lack of Google advertisements caused a "dramatic negative impact" on the business. The Internet this year is generating 75% of the catalog's business, the court filing said. About Signature Styles Signature Styles LLC, owner of the Spiegel catalog, filed a Chapter 11 petition (Bankr. D. Del. Case No. 11-11733) on June 6, 2011, along with a deal to sell the business to affiliates of the current owners and lenders. New York-based Signature Styles, which filed for bankruptcy together with its affiliates, disclosed assets of $48.6 million and debt of $867.6 million. It purchased the Spiegel business for $21.7 million at a foreclosure sale in June 2009. Debt includes $37.2 million owing on a secured term loan and revolving credit. Unsecured debt totals $35.3 million, which include $9.8 million owing to trade suppliers and $23.2 million in customer obligations. The lenders and owners are funds affiliated with Patriarch Partners LLC. Christopher A. Ward, Esq., at Polsinelli Shughart PC, in Wilmington, Delaware, serves as counsel to the Debtor. Western Reserve Partners LLC serves as investment bankers. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. A fund affiliated with Patriarch Partners LLC has an agreement to buy the business in return for the assumption of specified debt, including $30 million owing on the term loan and revolving credit. The buyer also will honor some customer obligations. The bankruptcy court authorized a Sept. 1 auction to learn whether the best offer for the business is from a fund associated with Patriarch Partners LLC. The purchase contract with Patriarch was negotiated before the Chapter 11 filing. Roberta A. DeAngelis, United States Trustee for Region 3, appointed an official committee of unsecured creditors in the case. The panel is represented by Frederick B. Rosner, Esq. Julia B. Klein, Esq. THE ROSNER LAW GROUP LLC 824 N. Market Street, Suite 810 Wilmington, DE 19801 Tel: (302) 777-1111 Fax: (302) 220-1007 E-mail: rosner@teamrosner.com - and - Jay R. Indyke, Esq. Jeffrey L. Cohen, Esq. Brent Weisenberg, Esq. Richelle Kalnit, Esq. COOLEY LLP 1114 Avenue of the Americas New York, NY 10036 Tel: (212) 479-6000 Fax: (212) 479-6275 E-mail: jindyke@cooley.com jcohen@cooley.com bweisenberg@cooley.com rkalnit@cooley.com SL GREEN: Fitch Rates $250-Mil. Sr. Unsecured Notes at 'BB+' ------------------------------------------------------------ Fitch Ratings has assigned a 'BB+' rating to the $250 million senior unsecured notes issued by SL Green Operating Partnership, L.P., the operating partnership of SL Green Realty Corp. (NYSE: SLG), and Reckson Operating Partnership, L.P., as co-obligors. The $250.0 million aggregate principal amount of 5.00% senior notes, which were priced to yield 5.03%, are due Aug. 15, 2018. SL Green expects net proceeds from the sale of the notes to be approximately $246.5 million and expects to use the net proceeds to repay a portion of the amount outstanding under its unsecured credit facility and for general corporate purposes. SL Green Operating Partnership L.P.'s Issuer Default Rating (IDR) is 'BB+'. The Rating Outlook is Stable. SL Green Realty Corp. is an office REIT located in New York City. As of June 30, 2011, SL Green owned interests in 57 Manhattan properties totaling more than 33.6 million square feet. This includes ownership interests in 25.8 million square feet of commercial properties and debt and preferred equity investments secured by 7.6 million square feet. SPANSION INC: Valuation Appeal Dismissed as Moot ------------------------------------------------ District Judge Robert B. Kugler dismissed as equitably moot an appeal by an ad hoc group of certain holders of subordinated debentures issued by Spansion LLC from an April 2010 decision by the Bankruptcy Court determining the Debtor's enterprise value to be between $872 million and $944 million. Spansion sought to dismiss the appeal under the doctrine of equitable mootness because the parties substantially consummated the confirmed Plan. The debenture holders argued that equitable mootness is inappropriate because the appeal does not ask the Court to overturn the Confirmed Plan. Instead, the appeal affects the Bankruptcy Court's valuation determination and does not require the Court to unravel the entire reorganization plan. According to Judge Kugler, the Bankruptcy Court's determination of Spansion's enterprise value was an integral part of the overall reorganization plan. The Bankruptcy Court's valuation directly affects the general distribution scheme because Spansion issued millions of dollars worth of new common stock and unsecured notes pursuant to that valuation. Changing the Bankruptcy Court's valuation jeopardizes the entire bankruptcy reorganization plan. A copy of Judge Kugler's Aug. 4, 2011 Opinion is available at http://is.gd/tLFQZ9from Leagle.com. About Spansion Spansion Inc. -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 bankruptcy on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On Feb. 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, served as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, served as the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee appointed an official committee of unsecured creditors in the case. As of Sept. 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. Spansion submitted its first plan of reorganization on Oct. 26, 2009, and gained approval from the U.S. Bankruptcy Court on its amended disclosure statement on Dec. 22, 2009. Spansion received confirmation from the U.S. Bankruptcy Court for its plan on April 16, 2010, and emerged from Chapter 11 protection May 10, 2010. Spansion entered Chapter 11 reorganization with more than $1.5 billion in debt. Spansion emerged a well-capitalized company with less than $480 million in debt and roughly $230 million in cash, which is supplemented with an undrawn credit line of up to $65 million. STANLEY NEWQUIST III: Transfers Property to Creditor ---------------------------------------------------- Bankruptcy Judge James F. Schneider signed off on a stipulation and consent order terminating the automatic stay in the bankruptcy case of Stanley Arthur Newquist, III, to allow the Debtor and his spouse Aimee T. Newquist to transfer a property at 56 Madison Place, Annapolis, Maryland, by deed in lieu of foreclosure to Maureen T. Lamb no later than Aug. 31, 2011, and pay all cost associated with the transfer. Ms. Lamb is a secured creditor of the Debtor to whom the Debtor and Mrs. Newquist jointly and severally owe the principal amount of $511,143.25 as of the Petition Date, plus 10 months of unpaid accrued interest of $25,550. On Jan. 12, 2005, Ms. Lamb sold her right, title and interest in the Property to the Debtor and Mrs. Newquist as tenants by the entirety for the sum of $500,000. Attorneys for Maureen T. Lamb are: Lawrence J. Yumkas, Esq. Lisa Yonka Stevens, Esq. LOGAN, YUMKAS, VIDMAR & SWEENEY, LLC 2530 Riva Road, Suite 400 Annapolis, MD 21401 Tel: (443) 569-0758 E-mail: lyumkas@loganyumkas.com lstevens@loganyumkas.com A copy of the Aug. 4, 2011 Stipulation and Consent Order is available at http://is.gd/ZhKQUzfrom Leagle.com. Annapolis, Maryland-based Stanley Arthur Newquist, III, dba Little Pink Houses, filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 10-32799) on Oct. 4, 2010, represented by John C. Gordon, Esq. -- johngordononline@yahoo.com -- as bankruptcy counsel. Mr. Newquist estimated assets of $500,001 to $1 million, and debts of $1 million to $10 million in debts. STEVE MCKENZIE: Grant Konvalinka Denied Leave to Sue Trustee ------------------------------------------------------------ Bankruptcy Judge Shelley D. Rucker denied a motion by Grant, Konvalinka & Harrison, P.C., seeking leave of the Bankruptcy Court to file a state court action in Bradley County against C. Kenneth Still, the trustee in the Chapter 7 case of Steve A. McKenzie, and the Trustee's attorneys, Richard L. Banks, and Richard L. Banks & Associates, P.C. GKH seeks to bring claims for malicious prosecution and abuse of process. A copy of the Court's Aug. 5, 2011 Memorandum is available at http://is.gd/gVITuKfrom Leagle.com. About Steve A. McKenzie The Steve A. McKenzie case was originally filed as an involuntary Chapter 7 bankruptcy (Bankr. E.D. Tenn. Case No. 08-16378) on Nov. 20, 2008. Mr. McKenzie filed a voluntary Chapter 11 bankruptcy (Bankr. E.D. Tenn. Case No. 08-16987) on Dec. 20, 2008. Upon request of counsel for the Debtor, the two cases were consolidated. The case has since proceeded with the earlier filing date of Nov. 20, 2008, as the effective date of the petition. On Jan. 15, 2009, the Court entered an agreed order converting the involuntary Chapter 7 case no. 08-16378 to a Chapter 11 proceeding and substantively consolidating the proceeding with case no. 08-16987. Mr. McKenzie estimated $100 million to $500 million in both assets and debts in his Chapter 11 petition. An Official Committee of Unsecured Creditors was appointed by the United States trustee. The Committee retained Evans LeRoy & Hackett PLLC as counsel. On Feb. 20, 2009, C. Kenneth Still was appointed as Chapter 11 trustee. He also tapped F. Scott LeRoy, Esq., as counsel. Mr. LeRoy ultimately withdrew from Evans LeRoy. The case was later converted back to Chapter 7 and Douglas R. Johnson was named the Chapter 7 trustee. He was terminated on June 14, 2010, and Mr. Still was added to the case as Chapter 7 trustee. STILLWATER MINING: Reports $42.7 Million Net Income in Q2 --------------------------------------------------------- Stillwater Mining Company filed with the U.S. Securities and Exchange Commission its quarterly report on form 10-Q reporting net income of $42.69 million on $222.60 million of total revenues for the three months ended June 30, 2011, compared with net income of $14.59 million on $134.86 million of total revenues for the same period during the prior year. The Company also reported net income of $78.89 million on $392.66 million of total revenues for the six months ended June 30, 2011, compared with net income of $27.95 million on $268.33 million of total revenues for the same period during the prior year. The Company's balance sheet at June 30, 2011, showed $1.03 billion in total assets, $363.65 million in total liabilities, and $675.28 million in total stockholders' equity. Francis R. McAllister, Stillwater Chairman and CEO, commented, "It is my great pleasure to report a second consecutive record earnings quarter for Stillwater Mining Company. All of our operations are performing well right now, reflecting strong PGM prices, improved productivity, improved cost management and a focus on building for the future. The increase in tons mined during this year's second quarter, combined with higher realized ore grades, resulted in a 26.7% increase in ounces of mined palladium and platinum produced compared to the same period last year. We continue to benefit from robust PGM, and specifically palladium, market dynamics and believe a favorable outlook continues. While average PGM prices declined slightly during the second quarter from earlier in the year, they have continued to increase significantly on a quarter over quarter comparison." A full-text copy of the Form 10-Q is available for free at: http://is.gd/CMF66F About Stillwater Mining Billings, Montana-based Stillwater Mining Company -- http://www.stillwatermining.com/-- is the only U.S. producer of palladium and platinum and is the largest primary producer of platinum group metals outside of South Africa and Russia. The Company's shares are traded on the New York Stock Exchange under the symbol "SWC." Stillwater carries a 'B' issuer credit ratings from Standard & Poor's. As reported by the TCR on Aug. 1, 2011, Moody's Investors Service upgraded Stillwater Mining Company's Corporate Family Rating (CFR) and Probability of Default Rating to 'B2' from 'Caa1' in recognition of the continued improvement in financial and operational performance which Moody's views as sustainable. The CFR upgrade reflects the meaningful recovery in Stillwater's primary end- market (the automotive sector), associated increase in demand for the company's mined platinum group metals (PGMs), and the increase in both palladium and platinum prices throughout 2010 and into 2011. * * * This concludes the Troubled Company Reporter's coverage of Stillwater Mining Company until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. SUMMIT VIEW: Law Firm's Claim Limited to $200T Settlement --------------------------------------------------------- District Judge Susan C. Bucklew affirmed a Bankruptcy Court order dated Feb. 15, 2011, granting granted a Motion to Enforce Settlement Agreement in favor of Summit View LLC, Ashley Glen LLC, and Riverwood LLC, and over the objection of Thaddeus Freeman, PLLC, counsel for creditor WDG Construction, Inc. Freeman appealed the ruling. Judge Bucklew said the lower court's decision to enforce the settlement agreement, thereby declining to impose a charging lien on the plan payments under the settlement agreement, was proper and must be upheld. The appellate case is Thaddeus Freeman, PLLC, v. Summit View, LLC, Ashley Glen, LLC, and Riverwood, LLC, Case No. 8:11-cv-724-T-24 (M.D. Fla.). A copy of Judge Bucklew's Aug. 1, 2011 Order is available at http://is.gd/7ZS8PIfrom Leagle.com. While the bankruptcy proceedings were ongoing, multiple adversary proceedings were initiated against WDG. WDG filed counterclaims in those actions. The adversary proceedings remained pending as of the date of the confirmation of Summit View's plan, and ultimately were resolved through a post-confirmation settlement agreement. The confirmed plan included a secured claim in favor of WDG against Summit View for $1,002,093.77, which was to be paid in 60 equal monthly payments of $6,154. Pursuant to the terms of the settlement, all of WDG's rights to receive payments under the Summit View plan were assigned to CWES II, LLC. In consideration for the assignment of the right to receive payments under the Summit View plan, CWES paid WDG $200,000. CWES did not assume any obligations or liabilities of WDG. Freeman and WDG executed an Hourly/Contingency Fee Agreement, wherein WDG agreed to pay Freeman an hourly rate of $350 or 33- 1/3% "of the gross amount of any recovery as paid . . . whichever is greater." The Bankruptcy Court approved the settlement on Sept. 13, 2010. Freeman then filed a Motion to Disburse Court Ordered Funds to Attorney, arguing that it was entitled to a charging lien on the settlement funds that WDG received under the settlement agreement, and requested that the Bankruptcy Court approve disbursal of one- third of the settlement funds, or $66,000. The Bankruptcy Court granted that motion, giving Freeman the right to disburse to itself funds equivalent to one-third of the total amount of funds WDG received from CWES pursuant to the settlement agreement. The law firm then claimed that it retained a valid charging lien as to the plan payments that were originally supposed to be made to WDG and were assigned to CWES, in addition to the agreed charging lien on the $200,000 settlement proceeds. In response, Summit View requested the Bankruptcy Court to make a determination that neither CWES nor Summit View was obligated to Freeman for one-third of the plan payments assigned to CWES under the settlement agreement. The Bankruptcy Court granted Summit View's request, saying the law firm is only entitled to claim from the $200,000 pot. Freeman was estopped from enforcing its lien as to those payments. About Summit View Palm Harbor, Florida-based Summit View, LLC, Ashley Glen, LLC, and Riverwood, LLC, were formed for the purpose of land development, including commercial, retail, and residential development. Ashley Glen owned a 260-acre mixed-use project, named Ashley Glen and planned for the northeast intersection of State Road 54 and the Suncoast Parkway in Pasco County. The three firms are owned by JES Properties, Inc., which is in turn owned by Douglas J. Weiland and his wife, Elizabeth Sirna. Summit View filed for Chapter 11 bankruptcy (Bankr. Md. Fla. Case No. 09-06495) on April 2, 2009. Ashley Glen and Riverwood filed for Chapter 11 (Bankr. M.D. Fla. Case Nos. 09-13611 and 09-13612) on June 25, 2009. The bankruptcy filing was precipitated by a number of factors, including a downturn in the housing and construction industries, breaches of contract, problems with project financing, and ongoing litigation. The cases were jointly administered. The Debtors were represented by Alberto F. Gomez, Jr., Esq. -- algomez@morsegomez.com -- at Morse & Gomez P.A. Summit View estimated $1 million to $10 million in both assets and debts. Ashley Glen estimated $10 million to $50 million in both assets and debts. On March 17, 2010, the Bankruptcy Court entered an order confirming Summit View's bankruptcy-exit plan. Terms of the plan were reported in the July 13, 2009 edition of the Troubled Company Reporter. A full-text copy of the Plan is available for free at http://ResearchArchives.com/t/s?3ee7 SYSTEMS HOLDING: Case Summary & 11 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Systems Holding, Ltd. dba The Executive Suites@Flintrock 2802 Flintrock Trace, Suite 200 Austin, TX 78738 Bankruptcy Case No.: 11-11943 Chapter 11 Petition Date: August 2, 2011 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: Frank B. Lyon, Esq. 6836 Austin Center Blvd., Suite 150 Austin, TX 78731 Tel: (512) 345-8964 Fax: (512) 697-0047 E-mail: frank@franklyon.com Scheduled Assets: $2,081,962 Scheduled Debts: $2,747,042 A list of the Company's 11 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txwb11-11943.pdf The petition was signed by Paul Beavers, member/manager of Syndications, LLC, general partner. TAWK DEVELOPMENT: Moves Plan Exclusivity Hearing to Aug. 31 ---------------------------------------------------------- Hon. Mike K. Nakagawa of the U.S. Bankruptcy Court for the District of Nevada approved the stipulation entered between Tawk Development, LLC and Aviva Real Estate Investors (Falcon Landing), LLC, extending the Debtor's exclusive periods to file and solicit acceptances for the proposed plan of reorganization. The stipulation provides for: 1. The Debtor may file a plan of reorganization is extended until Aug. 5; 2. Aviva and the Debtor reserve all of their respective remedies regarding any plan that may be proposed by the Debtor or any other party; 3. the hearing on the Debtor's request that plan solicitation period be extended until Oct. 28, will be continued to Aug. 31, at 9:30 a.m. The Debtor and Aviva, its principal secured creditor and the only creditor, are seeking to reach a consensual resolution as to their respective disputes, which resolution, to the extent one can be reached, will be incorporated into such plan of reorganization. Aviva is represented by Quarles & Brady LLP and Pisanelli Bice PLLC. About Tawk Development Las Vegas, Nevada-based Tawk Development, LLC, owns and operates a 198-unit resort style apartment complex known as Falcon Landing, which is located at 5067 Madre Mesa Drive in Las Vegas. It filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 11- 10584) on Jan. 14, 2011. Talitha B. Gray, Esq., at Gordon & Silver, Ltd., serves as the Debtor's bankruptcy counsel. The Debtor disclosed $22,747,153 in assets and $21,263,119 in liabilities as of the Chapter 11 filing. TEGRANT CORP: S&P Raises Corporate Credit Rating to 'CCC+' ---------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Dekalb, Ill.-based Tegrant Corp. to 'CCC+' from 'CCC'. At the same time, Standard & Poor's removed all ratings on the company from CreditWatch, where they had been placed with positive implications on Dec. 21, 2010. The outlook is stable. "The upgrade follows our assessment of Tegrant's improved earnings prospects after significant restructuring actions and its integration of Createc," said Standard & Poor's credit analyst Ket Gondha. The acquisition of Indianapolis, Ind.-based Createc Corp. is expected to generate significant synergies in the coming quarters. "The challenging macroeconomic environment has hindered recent profitability, and concerns about sufficient liquidity and covenant restrictions constrain the ratings," Mr. Gondha continued. "However, we believe earnings generation will meaningfully improve in the second half of 2011." At the same time, Standard & Poor's assigned a 'B-' issue-level rating to Tegrant's $25 million first-lien term loan C due 2014. Standard & Poor's assigned the loan a '2' recovery rating, reflecting the expectation of substantial (70% to 90%) recovery in the event of a payment default. The company primarily used funds from the term loan C along with borrowings on the revolving credit facility to fund its Createc acquisition. Standard & Poor's also raised its issue-level ratings on the company's existing $265 million first-lien credit facilities to 'B-' from 'CCC+' and the issue-level rating on the company's $75 million second-lien term loan facility to 'CCC-' from 'CC'. The recovery ratings on the first-lien facilities remain '2', reflecting the expectation of substantial (70% to 90%) recovery in the event of a payment default. The recovery rating on the second- lien term loan facility remains '6', indicating the expectation for negligible (0% to 10%) recovery in the event of a payment default. With annual sales of more than $425 million, pro forma for the acquisition of Createc, Tegrant is a leading manufacturer and designer of protective, temperature-assurance, and retail packaging products for a range of primarily North American markets. This includes molded foam components for the automotive and building products industries, temperature- controlled transport products for the health care and food service industries, and thermoformed packages and packaging machines for consumer-related markets. The ratings on Tegrant reflect the company's high leverage, limited liquidity, and upcoming maturities in 2013, offset by the expectation of support from its private-equity sponsor. The ratings also incorporate Tegrant's leading positions in its protective packaging markets, where it is at least twice the size of its next-largest competitor. However, its markets are in niche segments of the packaging industry that are fragmented, highly competitive, and sensitive to macroeconomic conditions. Standard & Poor's characterizes the business risk profile as weak and the financial risk profile as highly leveraged. Since Metalmark Capital's acquisition of Tegrant in March 2007, the company's leverage ratio has remained significantly greater than 5x, and compliance with financial covenants has been an ongoing concern. Covenant violations represent a strong possibility, given weak macroeconomic conditions and upcoming covenant step-downs. "Still, we expect that Metalmark will take steps to support liquidity, including funding equity cures to prevent covenant violations," Mr. Gondha said. TEN X: Files Schedules of Assets and Liabilities ------------------------------------------------ Ten X Capital Partners III, LLC (SERIES B), filed with the U.S. Bankruptcy Court for the Northern District of Illinois its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $10,000,000 B. Personal Property $557,411 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $6,935,691 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $60,695 ----------- ----------- TOTAL $10,557,411 $6,996,386 Ten X Capital Partners III, LLC (Series B) operates an industrial real property located at 601 W. Polk Street, Chicago, Illinois, as a telecom hotel and storage facility. Ten X Capital Partners III, LLC (Series B) filed a voluntary Chapter 11 petition (Bankr. N.D. Ill. Case No. 11-27294) on June 30, 2011. Judge John H. Squires presides over the case. The Debtor is represented by Chester H. Foster, Jr., Esq., at Foster & Smith. In its petition, the Debtor estimated $10 million to $50 million in assets, and $1 million to $10 million in debts. The petition was signed by John W. Branch, manager of RM Advisors, LLC. TERRANOVA-2007: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Terranova - 2007, LP 4545 Post Oak Place, Suite 315 Houston, TX 77027 Bankruptcy Case No.: 11-36753 Chapter 11 Petition Date: August 2, 2011 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Richard L Fuqua, II, Esq. FUQUA & ASSOCIATES, PC 5005 Riverway, Ste. 250 Houston, TX 77056 Tel: (713) 960-0277 E-mail: fuqua@fuquakeim.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Robert L. Farrar, Jr., president of Palo Pinto Land Company, general partner. TERRESTAR CORP: Files Disclosure Statement for Plan --------------------------------------------------- BankruptcyData.com reports that TerreStar Corporation (TSC) filed with the U.S. Bankruptcy Court a Disclosure Statement related to the Joint Chapter 11 Plan of Terrestar Corporation, Motient Communications, Motient Holdings, Motient License, Motient Services, Motient Ventures Holding, Mvh Holdings, Terrestar Holdings and Terrestar New York - which was filed on July 22, 2011. "The TSC Debtors believe that their businesses and assets have significant value that would not be realized in a liquidation, either in whole or in substantial part. Consistent with the valuation, liquidation and other analyses prepared by the TSC Debtors with the assistance of their advisor . . ., the value of the TSC Debtors is substantially greater as a going concern than in a liquidation. The TSC Debtors also believe that any alternative to Confirmation, such as an attempt by another party to file a competing plan, would result in significant delays, litigation and additional costs, and could negatively affect the value of the TSC Debtors' estates, which could ultimately lower the recoveries for all holders of Allowed Claims and Equity Interests," according to the Disclosure Statement obtained by BData. The Court scheduled a Sept. 19, 2011, hearing to consider the Disclosure Statement. About TerreStar Networks TerreStar Corporation and TerreStar Holdings, Inc., filed voluntary Chapter 11 petitions with the U.S. Bankruptcy Court for the Southern District of New York on Feb. 16, 2011. TSC's Chapter 11 filing joins the bankruptcy proceedings of TerreStar Networks Inc. and 12 other affiliates, which filed on Oct. 19, 2010. The October Chapter 11 cases are procedurally consolidated under TSN's Case No. 10-15446 under Judge Sean H. Lane. TSC is the parent company of each of the October Debtors. TSC has four wholly owned direct subsidiaries: TerreStar Holdings, Inc., TerreStar New York Inc., Motient Holdings Inc., and MVH Holdings Inc. TSC's case is jointly administered with the cases of seven of the October Debtors under the caption In re TerreStar Corporation, et al., Case No. 11-10612 (SHL). The seven Debtor entities who sought joint administration with TSC are TerreStar New York Inc., Motient Communications Inc., Motient Holdings Inc., Motient License Inc., Motient Services Inc., Motient Ventures Holdings Inc., and MVH Holdings Inc. TSC is a Delaware corporation whose main asset is the equity in non-Debtor TerreStar 1.4 Holdings LLC, which has the right to use a "1.4 GHz terrestrial spectrum" pursuant to 64 licenses issued by the Federal Communication Commission. TSC also has an indirect 89.3% ownership interest in TerreStar Network, Inc., which operates a separate and distinct mobile communications business. TerreStar Holdings is a Delaware corporation that directly holds 100% of the interests in 1.4 Holdings LLC. TerreStar Networks -- TSN -- the principal operating entity of TSC, developed an innovative wireless communications system to provide mobile coverage throughout the United States and Canada using satellite-terrestrial smartphones. The system, however, required an enormous amount of capital expenditures and initially produced very little in the way of revenue. TSN's available cash and borrowing capacity were insufficient to cover its funding; thus, forcing TSN to seek bankruptcy protection in October 2010. TSC estimated assets and debts of $100 million to $500million in its Chapter 11 petition. Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serves as counsel for the TSC and TSN Debtors. Garden City Group is the claims and notice agent. Blackstone Advisory Partners LP is the financial advisor. The Garden City Group, Inc., is the claims and noticing agent in the Chapter 11 cases. Otterbourg Steindler Houston & Rosen P.C. is the counsel to the Official Committee of Unsecured Creditors formed in TSN's Chapter 11 cases. FTI Consulting, Inc., is the Committee's financial advisor. TERRESTAR CORP: Plan Exclusivity Expires Oct. 14 ------------------------------------------------ The Hon. Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York extended TerreStar Corporation, et al.'s exclusive periods to file and solicit acceptances for the proposed plan of reorganization until Aug. 15, 2011, and Oct. 14, respectively. About TerreStar Corp. TerreStar Corporation and TerreStar Holdings, Inc., filed voluntary Chapter 11 petitions with the U.S. Bankruptcy Court for the Southern District of New York on Feb. 16, 2011. TSC's Chapter 11 filing joins the bankruptcy proceedings of TerreStar Networks Inc. and 12 other affiliates, which filed on Oct. 19, 2010. The October Chapter 11 cases are procedurally consolidated under TSN's Case No. 10-15446 under Judge Sean H. Lane. TSC is the parent company of each of the October Debtors. TSC has four wholly owned direct subsidiaries: TerreStar Holdings, Inc., TerreStar New York Inc., Motient Holdings Inc., and MVH Holdings Inc. TSC's case is jointly administered with the cases of seven of the October Debtors under the caption In re TerreStar Corporation, et al., Case No. 11-10612 (SHL). The seven Debtor entities who sought joint administration with TSC are TerreStar New York Inc., Motient Communications Inc., Motient Holdings Inc., Motient License Inc., Motient Services Inc., Motient Ventures Holdings Inc., and MVH Holdings Inc. TSC is a Delaware corporation whose main asset is the equity in non-Debtor TerreStar 1.4 Holdings LLC, which has the right to use a "1.4 GHz terrestrial spectrum" pursuant to 64 licenses issued by the Federal Communication Commission. TSC also has an indirect 89.3% ownership interest in TerreStar Network, Inc., which operates a separate and distinct mobile communications business. TerreStar Holdings is a Delaware corporation that directly holds 100% of the interests in 1.4 Holdings LLC. TerreStar Networks -- TSN -- the principal operating entity of TSC, developed an innovative wireless communications system to provide mobile coverage throughout the United States and Canada using satellite-terrestrial smartphones. The system, however, required an enormous amount of capital expenditures and initially produced very little in the way of revenue. TSN's available cash and borrowing capacity were insufficient to cover its funding; thus, forcing TSN to seek bankruptcy protection in October 2010. TSC estimated assets and debts of $100 million to $500million in its Chapter 11 petition. Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, in New York, serves as counsel for the TSC and TSN Debtors. Garden City Group is the claims and notice agent. Blackstone Advisory Partners LP is the financial advisor. The Garden City Group, Inc., is the claims and noticing agent in the Chapter 11 cases. Otterbourg Steindler Houston & Rosen P.C. is the counsel to the Official Committee of Unsecured Creditors formed in TSN's Chapter 11 cases. FTI Consulting, Inc., is the Committee's financial advisor. TEX X CAPITAL: Can Access Cole Taylor Bank's Cash Until Aug. 31 --------------------------------------------------------------- The U.S. Bankruptcy Court has granted Ten X Capital Partners III, LLC (Series B) permission, on an interim basis, to use cash collateral of Cole Taylor Bank through Aug. 31, 2011, solely to the extent necessary to meet its monthly expenses and make the $35,000 "Adequate Protection"Payment (for the month of August 2011) to the Secured Creditor as sent forth in a Modified Budget. The Debtor is granted a replacement lien in all of Debtor's assets to the extent of the Debtor's use of the cash collateral and any diminution of the value of the Secured Creditor's interest in the Debtor's assets. A further hearing is set for Aug. 9, 2011, at 10:00 a.m. As reported previously, Cole Taylor asserts claims against the Debtor, which as of May 3, 2011, totaled $6,434,850 with interest accruing from May 3, 2011, at the rate of $2,257.43 per day plus fees and costs. Cole Taylor asserts that its claims are secured by first mortgages on the Debtor's real estate commonly known as 601 W. Polk St., Chicago, IL 60607. Cole Taylor further asserts that it holds a lien on all of the rental revenue and receipts generated by the Real Estate by operation of the assignment of rents it holds. Ten X Capital Partners III, LLC (Series B) operates an industrial real property located at 601 W. Polk Street, Chicago, Illinois, as a telecom hotel and storage facility. Ten X Capital Partners III, LLC (Series B) filed a voluntary Chapter 11 petition (Bankr. N.D. Ill. Case No. 11-27294) on June 30, 2011. Judge John H. Squires presides over the case. The Debtor is represented by Chester H. Foster, Jr., Esq., at Foster & Smith. In its petition, the Debtor estimated $10 million to $50 million in assets, and $1 million to $10 million in debts. The petition was signed by John W. Branch, manager of RM Advisors, LLC. TREY RESOURCES: Stanley Wunderlich Appointed to Board ----------------------------------------------------- SilverSun Technologies, Inc., formerly known as Trey Resources, Inc., entered into a director agreement with Stanley Wunderlich, pursuant to which Wunderlich was appointed to the Company's board of directors effective July 26, 2011. On Aug. 3, 2011, the Company entered into an amended and restated Director Agreement. The term of the Amended Agreement is from Aug. 3, 2011, through the Company's next annual stockholders' meeting. The Amended Agreement may, at the option of the Board, be automatically renewed on such date that Wunderlich is re-elected to the Board. Under the Amended Agreement, Wunderlich is to be paid a stipend of $1,000 per quarter, payable at the end of each fiscal quarter. Notwithstanding the foregoing, the first Stipend will be in the amount of $3,000 and was paid on July 26, 2011, pursuant to the Original Director Agreement. Additionally, Mr. Wunderlich will receive warrants to purchase those number of shares of the Company's Class A common stock, par value $0.0001, as will equal (A) $20,000 divided by (B) the closing price of the Common Stock on the OTC Markets on the date of grant of the Warrant. Mr. Wunderlich, age 63, combines over 40 years of experience in Wall Street as a business owner and consultant. Mr. Wunderlich is a founding partner and has been Chairman and Chief Executive Officer of Consulting for Strategic Growth 1, specializing in investor and media relations and the formation of capital for early-growth stage companies both domestic and international, from 2000 through the present. Mr. Wunderlich has a Bachelor's degree from Brooklyn College. The Company believes that Mr. Wunderlich's experience in capital raising strategy and U.S. markets will assist the Company's growth strategy and development as public company. There is no family relationship between Mr. Wunderlich and any of the Company's directors or officers. About Trey Resources Livingston, N.J.-based Trey Resources, Inc. operates as a business consultant, and value-added reseller and developer of financial accounting software in the United States. The Company reported a net loss of $568,505 on $7.48 million of total revenue for the year ended Dec. 31, 2010, compared with a net loss of $1.50 million on $7.41 million of total revenue during the prior year. Friedman LLP, in East Hanover, NJ, expressed substantial doubt about the Company's ability to continue as a going concern. The Company's financial statements for the year ended Dec. 31, 2010 have been prepared assuming the Company will continue as a going concern. The Company has incurred substantial accumulated deficits and operating losses, and at Dec. 31, 2010, has a working capital deficiency of approximately $5.1 million. The Company's balance sheet at March 31, 2011, showed $1.75 million in total assets, $6.46 million in total liabilities, all current, and a $4.71 million total stockholders' deficit. TRIBUNE CO: Asks OK of Settlement of 2007 Minimum Wage Class Suit ----------------------------------------------------------------- Chapter11Cases.com reports that Tribune Company and Tribune New York Newspaper Holdings, LLC, asked the Delaware bankruptcy court Friday to approve a proposed settlement of a 2007 class action suit pending in the Supreme Court of New York, County of New York alleging minimum wage claims under the Fair Labor Standards Act and the New York Labor Law. According to the report, the complaint, captioned James Allen, et al. v. Tribune New New York Newspaper Holdings, LLC, et al., Index No. 602801/2007, alleged that a class of approximately 2,950 individuals "were entitled to minimum wage payments as 'employees' for their services as 'hawkers' of amNew York, a free daily morning newspaper published by" Tribune New York Newspaper Holdings, LLC (which is a debtor in the Tribune Co.'s on-going chapter 11 cases filed in 2008). Tribune contends that "the 'hawkers' were at all times independent contractors and not 'employees.'" Tribune contested the plaintiffs' motion for certification, asserting that it was untimely (it was filed almost a year after the claims bar date) and prejudicial. Tribune also claimed that the plaintiffs failed to meet the requirements of Rule 23. The proposed class proof of claim asserted a claim in the amount of $1.5 million. In addition, proofs of claim were filed on behalf of eighteen plaintiffs, each of which asserted a claim of $10,000. Under the proposed settlement, the Tribune debtors will contribute $275,000 of a total gross settlement amount of $325,000 (with the other $50,000 coming from non-debtor co-defendants) in full and final settlement of all claims brought by the plaintiffs on behalf of individuals "that promoted and/or distributed the amNew York newspaper from 2004 and 2007." The proposed settlement is a fixed cash settlement and is not contingent upon plan confirmation, but the payment of the settlement would be made after the effective date of the plan. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRICO MARINE: Anticipates Plan to Be Effective Tomorrow ------------------------------------------------------- As reported in the TCR on Thursday, the U.S. Bankruptcy Court for the District of Delaware confirmed Trico Marine Services Inc.'s Chapter 11 liquidation plan, clearing the defunct marine oil services company to distribute about $37 million to creditors. In a Form 8-K filing Friday, the Company anticipates that the effective date of the Plan will be on or about Aug. 10, 2011, provided certain conditions have been satisfied or waived. The Chapter 11 Cases of Trico Marine Cayman, LP, and Trico Holdco, LLC, will be dismissed pursuant to Section 1112 of the Bankruptcy Code on the Effective Date. A complete text of the Plan is available at http://is.gd/RgIiR2 A complete text of the Confirmation Order is available at: http://is.gd/xMCVhs The Plan is a liquidating plan that provides, among other things, for the liquidation of the Plan Debtors' remaining assets by a Plan Administrator and for the satisfaction of all Allowed Claims. All existing Equity Interests in the Company will remain in place for a period of 90 days after the Effective Date, pending a decision by the Plan Administrator to implement certain transactions described in the Plan. Should the Plan Administrator not elect to keep the existing Equity Interests outstanding, such Equity Interests will be canceled on the 90th day after the Effective Date. In either event, existing holders of Equity Interests will receive no distributions under the Plan. The Plan Administrator will reduce the remaining assets of the Plan Debtors, and their remaining non-Debtor affiliates, to cash and distribute the cash first in full payment of any and all Allowed Administrative Claims, Priority Tax Claims, 8.125% Notes Secured Claims, Other Secured Claims, Other Priority Claims, and Superpriority Administrative Claims. The remaining assets of the Plan Debtors, including the proceeds of the Debtors' 9019 settlement with their former non-Debtor "Opco"affiliates, will be distributed in accordance with the terms of the Plan. Each of the Plan Debtors will be dissolved after liquidation is complete. About Trico Marine Headquartered in Texas, Trico Marine Services, Inc. -- http://www.tricomarine.com/-- provides subsea services, subsea trenching and protection services, and towing and supply vessels. Trico filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-12653) on Aug. 25, 2010. John E. Mitchell, Esq., Angela B. Degeyter, Esq., and Harry A. Perrin, Esq., at Vinson & Elkins LLP, serve as the Debtor's bankruptcy counsel. The Debtor disclosed US$30,562,681 in assets and US$353,606,467 in liabilities as of the Petition Date. Affiliates Trico Marine Assets, Inc. (Bankr. D. Del. Case No. 10-12648), Trico Marine Operators, Inc. (Case No. 10-12649), Trico Marine International, Inc. (Case No. 10-12650), Trico Marine Cayman, L.P. (Case No. 10-12651), and Trico Holdco, LLC (Case No. 10-12652) filed separate Chapter 11 petitions. Cahill Gordon & Reindell LLP is the Debtors' special counsel. Alix Partners Services, LLC, is the Debtors' chief restructuring officer. The financial advisors are Evercore Partners and AP Services LLC. Epiq Bankruptcy Solutions is the Debtors' claims and notice agent. Postlethwaite & Netterville serves as the Debtors' accountant and Ernst & Young LLP serves as tax advisors. PricewaterhouseCoopers LLC provides the independent accountants and tax advisors for the Debtors. Aside from the Cayman Islands holding company, Trico's foreign subsidiaries were not included in the filing and were not subject to the requirements of the U.S. Bankruptcy Code. The Official Committee of Unsecured Creditors tapped Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski, Stang, Ziehl & Jones LLP, in Wilmington, Delaware, and Andrew K. Glenn, Esq., David J. Mark, Esq., and Daniel A. Fliman, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, as counsel. The Trico Supply Group -- which includes Trico Supply AS, Trico Shipping AS, DeepOcean AS, CTC Marine Projects Ltd. and other subsidiaries -- completed an out-of-court restructuring in May 2011. Pursuant to the out-of-court restructuring, $399,500,000 or 99.88%, of Trico Shipping's 11-7/8% Senior Secured Notes due 2014, the Trico Supply Group's working capital facility debt and intercompany claims and interests held by Trico Marine entities, were equitized and the holders received common stock of DeepOcean Group Holding AS, a new Norwegian private limited company. DeepOcean Holding and its subsidiaries, including Trico Supply, Trico Shipping, DeepOcean, CTC and other subsidiaries, were spun off Trico Marine. UNUM GROUP: Moody's Affirms '(P)Ba1' Subordinate Shelf Rating ------------------------------------------------------------- Moody's Investors Service has affirmed the credit ratings of Unum Group (Unum; NYSE: UNM; senior debt at Baa3), and the A3 insurance financial strength (IFS) ratings of the company's U.S. life insurance subsidiaries. Moody's also changed the outlook on Unum and all of its insurance affiliates to positive from stable. RATINGS RATIONALE Commenting on the change in Unum's rating outlook to positive, Moody's Vice President and Senior Credit Officer Ann Perry said, "Unum's positive earnings momentum, improving business diversification, and continuing improvement in financial flexibility is strengthening its credit profile relative to its current ratings." Moody's noted that Unum's earnings diversification has improved as voluntary benefits contribute a growing share of the company's earnings. In addition, because benefit ratios in the company's core long term disability (LTD) business have remained relatively stable throughout the economic slowdown, Moody's expects limited downside risk from an acceleration of claims under its base scenario of a continued sluggish economic recovery. The rating agency added that the positive outlook also reflects the expectation of further reductions in Unum's financial leverage, currently in the low 20% range, over the next year and continued improvement in the company's earnings coverage, driven both by lower interest expense as debt reduces and by stronger GAAP and statutory earnings. Moody's said that the ratings affirmation reflects Unum's leading market share in the group long-term and individual disability markets and the company's established position in the voluntary benefits market. The ratings also benefit from the company's access to a huge claims data base, focus on claims management and return-to-work programs, and its strong position in the group life market. According to the rating agency, Unum also has a good quality and liquid investment portfolio, minimal exposure to structured securities, including non-agency RMBS securities, as well as below average investment concentration in commercial mortgages. During the financial crisis, Unum's impairments as a percent of invested assets were among the lowest in the industry. The rating agency added that it expects future investment losses will continue to be manageable relative to Unum's earnings capacity. Commenting on the challenges facing Unum, Moody's said that despite improvement in business diversification, a sizeable amount of Unum's product risk profile and earnings are associated with the disability business in both the U.S. and UK. Moody's views the disability product risk profile as one of the higher in the life insurance industry, as this is a long-tailed business and claims development can be influenced in unexpected ways by a variety of economic and societal factors. With the sluggish recovery and persistent unemployment, the rating agency said that claims could increase if there is a double dip recession or unemployment rates increase. However, Moody's noted that the A3 IFS rating incorporates potential for a moderate increase in the incidence and/or duration of disability claims. Moody's said that the following would place upward pressure on Unum's ratings: 1) a sustained consolidated NAIC RBC ratio of at least 325%; 2) continued pricing discipline and no deterioration of loss ratios (i.e., sustained U.S. group disability loss ratio of not greater than 85%;) 3) adjusted financial leverage remains below 25%; and 4) cash flow and earnings coverage are maintained at levels of at least 5 times and 8 times, respectively. Conversely, the following could result in a return of the outlook back to stable: 1) sustained U.S. group disability loss ratio of over 85%; 2) regulatory capitalization falls below a 325% NAIC RBC ratio; 3) adjusted financial leverage exceeds 25%; or 4) cash-flow and earnings coverage fall below 5 times and 8 times, respectively. These ratings have been affirmed with the outlook changed to positive from stable: Unum Group: Senior unsecured debt at Baa3; senior unsecured shelf at (P)Baa3; subordinate shelf at (P)Ba1; preferred shelf at (P)Ba2; UNUM Corporation: Senior unsecured debt at Baa3; Provident Companies, Inc.: Senior unsecured debt at Baa3; Provident Financing Trust I: Preferred stock at Ba1 (hyb); UnumProvident Finance Company plc: Senior unsecured debt at Baa3; UNUM Life Insurance Company of America: Insurance financial strength at A3; First UNUM Life Insurance Company: Insurance financial strength at A3; Colonial Life & Accident Insurance Company: Insurance financial strength at A3; Provident Life and Accident Insurance Co.: Insurance financial strength at A3; Paul Revere Life Insurance Company: Insurance financial strength at A3; Paul Revere Variable Annuity Insurance Co.: Insurance financial strength at A3. Unum Group Financing Trust I/II: Preferred stock shelf at (P)Ba1. Unum Group is headquartered in Chattanooga, Tennessee. At June 30, 2011, Unum had total assets of approximately $58 billion and total shareholders' equity of about $9 billion. The principal methodology used in this rating was Moody's Global Rating Methodology for Life Insurers published in May 2010. VALENCE TECHNOLOGY: Incurs $3.09 Million Net Loss in June 30 Qtr. ----------------------------------------------------------------- Valence Technology, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $3.09 million on $14.08 million of revenue for the three months ended June 30, 2011, compared with a net loss of $4.61 million on $5.57 million of revenue for the same period during the prior year. The Company's balance sheet at June 30, 2011, showed $44.74 million in total assets, $90.58 million in total liabilities, $8.61 million in redeemable convertible preferred stock, and a $54.45 million total stockholders' deficit. The Company said that as a result of the Company's limited cash resources and history of operating losses there is substantial doubt about its ability to continue as a going concern. The Company presently has no further commitments for financing by the Company's Chairman Carl Berg and or his affiliates. Recently, the Company has depended on sales of its common stock under the At- Market Issuance Agreement with Wm. Smith & Co and short term loans and stock sales with Mr. Berg. If the Company is unable to obtain additional financing from Mr. Berg, through the Company's agreement with Wm. Smith & Co, or others on terms acceptable to us, or at all, the Company may be forced to cease all operations and liquidate its assets. As reported by the TCR on June 3, 2011, PMB Helin Donovan, LLP, in Austin, Texas, noted that Company's recurring losses from operations, negative cash flows from operations and net stockholders' capital deficiency raise substantial doubt about its ability to continue as a going concern. "We are very pleased with our revenue results as we continue to fulfill the emerging energy storage needs of diverse world markets. For example, in Q1 over 20 percent of our business was in the medical industry. Within this sector, our advanced energy storage solutions are increasingly displacing traditional lead acid technology. Thanks to the intense focus of our sales and marketing team we anticipate further success within this market, as well as other emerging lithium markets," said Robert L. Kanode, president and chief executive officer of Valence Technology. "On the fleet and delivery vehicle portion of our business, we are happy to report a $7.2 million June order from Electric Vehicles International (EVI). This order is for 100 EVI Walk-In vans to be placed throughout California. We are EVI's exclusive supplier and expect to begin shipments before year end as other truck and drive train components are delivered." A full-text copy of the Form 10-Q is available for free at: http://is.gd/958qTW About Valence Technology Austin, Texas-based Valence Technology, Inc. (NASDAQ: VLNC) -- http://www.valence.com/-- is a global leader in the development of safe, long-life lithium iron magnesium phosphate energy storage solutions and provides the enabling technology behind some of the world's most innovative and environmentally friendly applications. Valence Technology has its Research & Development Center in Nevada, its Europe/Asia Pacific Sales office in Northern Ireland and global fulfillment centers in North America and Europe. The Company reported a net loss of $12.68 million on $45.88 million of revenue for the year ended March 31, 2011, compared with a net loss of $23.01 million on $16.08 million of revenue during the prior year. VALLEY BAPTIST: Fitch Puts 'BB' Rating on Watch Evolving -------------------------------------------------------- Fitch Ratings has placed on Rating Watch Evolving the 'BB' rating on the revenue bonds issued on behalf of Valley Baptist Health System (VBHS): -- $94 million Tarrant Co Health Facilities Development Corporation series 2007 revenue bonds (Valley Baptist Medical Center- Brownsville)* -- $37.6 million Rio Grande Valley Health Facilities Development Corporation revenue bonds series 1992A&B (Valley Baptist Medical Center Project)**. * The bonds are supported by an irrevocable letter of credit issued by JP Morgan Chase Bank, N.A. which Fitch was not asked to rate. ** The bonds are insured by MBIA, Inc. whose Insurer Financial Strength is not rated by Fitch. The Rating Watch Evolving indicates that the rating may be raised, lowered or affirmed. This action reflects the Feb. 15, 2011 announcement by Valley Baptist Health System that they have entered into a Letter of Intent with Vanguard Health Systems, Inc. with respect to the creation of a new joint venture. According to VBHS' management, the series 2007 and 1992A&B are expected to be defeased upon closing of the asset purchase transaction, which is expected late this summer. Fitch will monitor the negotiations and update the market accordingly. With acute facilities in Harlingen and Brownsville, TX, VBHS operates a total of 828 acute beds. In fiscal 2010, VBHS reported $514.7 million of total revenues and support (unaudited). VILLAGE AT CAMP BOWIE: Denies Confirmation of Second Amended Plan ----------------------------------------------------------------- Bankruptcy Judge Dennis Michael Lynn denied confirmation of the Second Amended Plan of Reorganization of Village at Camp Bowie I, L.P. in an Aug. 4, 2011 Memorandum Opinion, a copy of which is available at http://is.gd/x9Lz1yfrom Leagle.com. Western Real Estate Equities, LLC, objected to Plan confirmation. The Court however, overruled the objection part and sustained it in part. Confirmation of the Plan is denied without prejudice to its reconsideration if modified to conform to the Court's memorandum opinion. Terms of the Amended Plan were reported in the May 20, 2011 edition of the Troubled Company Reporter. The Amended Plan contemplates that the Reorganized Debtor will continue in business and creditors will be paid 100% of their claims over time. A full-text copy of the Amended Disclosure Statement is available for free at http://ResearchArchives.com/t/s?75bf A full-text copy of the Amended Chapter 11 Plan is available for free at http://ResearchArchives.com/t/s?75c0 Western acquired interest in two notes executed by the Debtor under its loans with SouthTrust Bank and Texas Capital Bank, National Association. The Debtor had borrowed up to $36,535,000 from SouthTrust and TCB on a short-term basis, partly for purchase of its property and partly for refurbishing it. The loan was financed by a promissory note in the original maximum principal amount of $26,535,000, payable to the order of SouthTrust, and a second promissory note in the original maximum principal amount of $10,000,000, payable to the order of TCB. Wachovia Bank, N.A., became successor by merger with SouthTrust to the SouthTrust Note and successor by assignment to the TCB Note. Wells Fargo Bank, N.A., became successor in interest to the Notes by merger with Wachovia. The Notes matured Feb. 11, 2010. The principal amount owed by the Debtor was $31,292,824. The Debtor defaulted on the Notes at their maturity, and that default was followed by a series of forbearance agreements, which was extended a final time to July 9, 2010. After the expiration of the forbearance period, the Bank decided to auction off the Notes. Western acquired the Notes at a discount and posted the Property for August 2010 foreclosure. Court papers indicate Western assumed its position as a secured creditor to acquire the Property. Western is not in the lending business and wishes to own and operate the Property. Western had no interest in negotiating Plan treatment acceptable to it with Debtor. About Village at Camp Bowie I Dallas, Texas-based Village at Camp Bowie I, L.P. owns a low-rise, mixed-use development in southwest Fort Worth, Texas, known eponymously as the Village at Camp Bowie. The Property occupies 23.08 acres in an excellent location in one of the busier areas of the city. Space in the Property is leased for office, retail, restaurant and entertainment purposes. The Property is presently slightly less than 80% occupied. Village at Camp Bowie I filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-45097) on Aug. 2, 2010. J. Mark Chevallier, Esq., at McGuire, Craddock & Strother, P.C., in Dallas, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. VITAMINSPICE: Involuntary Chapter 11 Case Summary ------------------------------------------------- Alleged Debtor: VitaminSpice 996 Old Eagle School Road, Suite 1102 Wayne, PA 19087 Bankruptcy Case No.: 11-16200 Involuntary Chapter 11 Petition Date: August 5, 2011 Court: U.S. Bankruptcy Court Eastern District of Pennsylvania (Philadelphia) Judge: Magdeline D. Coleman Petitioners' Counsel: Peter Edward Sheridan, Esq. ATTORNEY AT LAW P.O. Box 12331 Philadelphia, PA 19119 Tel: (617) 759-0099 E-mail: sheridan.pete@gmail.com Creditors who signed the Chapter 11 petition: Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Learned J. Hand Judgment $262,701 710 Market Street Chapel Hill, NC 27516 John Robison Promissory Note $58,000 707 S. 2nd Street Philadelphia, PA 19147 IBT South Florida, LLC Promissory Note $38,500 757 SE 17th Street, #339 Fort Lauderdale, FL 33316 Esthetics World Cash on Deposit $30,000 Karen Campo, President 1005 Country Club Drive Cheyenne, WY 82001 Jehu Hand Expense $25,151 24351 Pasto Road, #B Reimbursement Dana Point, CA 92629 VITRO SAB: Seeks $6.2 Million From Bondholders for Fees ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that 10 subsidiaries of Vitro SAB, the Mexican glassmaker, filed papers asking the bankruptcy judge in Dallas to assess $6.2 million in damages against bondholders who filed unsuccessful involuntary Chapter 11 petitions. The dispute goes to the bankruptcy judge for decision on Aug. 23. Mr. Rochelle recounts that holders of some of Vitro's $1.2 billion in defaulted bonds filed involuntary Chapter 11 petitions last year against the 10 Vitro subsidiaries and others. Some put themselves into Chapter 11 this year and later sold their businesses. In April, the bankruptcy judge in Texas denied the involuntary petitions against 10 subsidiaries that hadn't elected Chapter 11 voluntarily. Mr. Rochelle relates that the 10 subsidiaries that escaped bankruptcy filed papers on Aug. 3 based on a provision in bankruptcy law they say automatically entitles them to recovery of attorneys' fees expended in successfully fighting off an involuntary petition. The 10 Vitro subsidiaries said the involuntary petitions caused "an onslaught of adverse publicity" that led to a "precipitous drop in sales." In addition, they said, "certain vendors began to tighten trade terms." Vitro companies said that the involuntary petitions were part of a "coordinated three-front war aimed at gaining undue leverage over Vitro's restructuring efforts." The Vitro companies said they took a "substantial voluntary reduction of the fees they incurred." The $6.2 million request includes $5.8 million for lawyers' time charges, plus expenses. The Vitro papers say almost 12,800 hours of lawyers' time was spent in fighting with bondholders. About Vitro America Headquartered in Memphis, Tennessee, Vitro America is a leading fabricator, distributor, and installer of glass in the construction, automotive replacement, and furniture markets. The company serves more than 40,000 customers from more than 100 locations throughout the United States. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009 and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan to buy back or swap US$1.2 billion in debt from bondholders based on the vote of US$1.9 billion of intercompany debt when third-party creditors were opposed. Vitro as a result dismissed the first Chapter 15 petition following the ruling by the Mexican court. On April 12, 2011, an appellate court in Mexico reinstated the reorganization. Accordingly, Vitro SAB on April 14 re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. On June 29, 2011, Vitro Packaging de Mexico S.A. de C.V. commenced a voluntary judicial reorganization proceeding under the Ley de Concursos Mercantiles before the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, the United Mexican States. On June 30, 2011, Vitro Packaging filed a chapter 15 petition (Bankr. N.D. Tex. Case No. 11-34224). Alejandro Francisco Sanchez-Mujica and Javier Arechavaleta Santos serve as Foreign Representatives of Vitro S.A.B. de C.V. and Vitro Packaging de Mexico S.A. de C.V. The Foreign Representatives are represented by David M. Bennett, Esq., Katharine E. Battaia, Esq., and Cassandra A. Sepanik, Esq., at Thompson & Knight LLP, and Andrew M. Leblanc, Esq., Risa M. Rosenberg, Esq., Thomas J. Matz, Esq., and Jeremy C. Hollembeak, Esq., at Milbank Tweed Hadley & McCloy LLP. Attorneys for the Ad Hoc Group of Vitro Noteholders are Jeff P. Prostok, Esq., and Lynda L. Lankford, Esq., at Forshey & Prostok, LLP, and Allan S. Brilliant, Esq., Benjamin E. Rosenberg, Esq., Craig P. Druehl, Esq., and Dennis H. Hranitzky, Esq., at Dechert LLP. Chapter 11 Proceedings A group of noteholders, namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P., opposed the exchange. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10- 47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. The U.S. subsidiaries subsequently sold their businesses to an affiliate of Sun Capital Partners Inc. for $55 million. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. VITRO SAB: U.S. Units Have Until Oct. 4 to Propose Ch. 11 Plan -------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Texas extended Vitro Asset Corp., et al.'s exclusive periods to file and solicit acceptances for the proposed chapter 11 plan until Oct. 4, 2011, and Dec. 3, respectively. As reported in the Troubled Company Reporter on July 6, 2011, the Debtors ask the Court to extend their exclusive periods until Oct. 2, 2011, and Dec. 1, respectively. An affiliate of Sun Capital Partners Inc. bought the operations of Vitro's U.S. subsidiaries for about $55 million. The price rose some $15 million at auction. The sale was completed on June 17. The Debtors related that though the sale's closing has enabled them to turn their attention toward the preparation of a plan, the value of additional potentially significant assets and the nature, amount, and validity of each class of claims may remain indeterminate until September 2011. Prior to the June 17 closing of the sale of substantially all the Debtors' assets to American Glass Enterprises LLC, the resources of the Debtors and the Debtors' professionals were dominated by the sale process. Furthermore, prior to the conclusion of the auction and the June 13 entry of the order approving the sale, the total amount of assets available for distribution were unknown. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan to buy back or swap US$1.2 billion in debt from bondholders based on the vote of US$1.9 billion of intercompany debt when third-party creditors were opposed. Vitro as a result dismissed the first Chapter 15 petition following the ruling by the Mexican court. On April 12, 2011, an appellate court in Mexico reinstated the reorganization. Accordingly, Vitro SAB on April 14 re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10- 47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. WASHINGTON MUTUAL: DOJ Ends Probe With No Criminal Charges ---------------------------------------------------------- Kaitlin Ugolik at Bankruptcy Law360 reports that the U.S. Department of Justice on Friday closed its investigation of Washington Mutual Inc. without filing any criminal charges against former executives in connection with the bank's 2008 collapse. Law360 relates that the DOJ said it would continue to cooperate with the Federal Deposit Insurance Corp., which has a pending lawsuit against three former WaMu executives accused of bankrupting the bank for their own benefit. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the U.S. Bankruptcy Court for the District of Delaware entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan Chase Bank, N.A., upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. Additionally, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. Washington Mutual has filed with the Bankruptcy Court a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement. The Company believes that the Modified Plan has addressed the Bankruptcy Court's concerns and looks forward to returning to the Bankruptcy Court to seek confirmation of the Modified Plan. WASHINGTON MUTUAL: Court Names Carolyn Cairns as Mediator --------------------------------------------------------- BankruptcyData.com reports that the U.S. Bankruptcy Court issued an order approving a stipulation regarding the appointment of a mediator and named Carolyn Cairns as mediator in the Washington Mutual (WMI) proceedings. Under the order, "Mediation shall commence on September 8, 2011...and WMI shall pay 100% of the fees charged by Ms. Cairns." The mediation order relates to a motion filed by Colleen M. Martin (claimant) seeking a $510,486 payment of an administrative expense and allowance and approval for distribution of a $475,678 general unsecured claim. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the U.S. Bankruptcy Court for the District of Delaware entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan Chase Bank, N.A., upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. Additionally, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. Washington Mutual has filed with the Bankruptcy Court a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement. The Company believes that the Modified Plan has addressed the Bankruptcy Court's concerns and looks forward to returning to the Bankruptcy Court to seek confirmation of the Modified Plan. WASHINGTON MUTUAL: Committee Taps Partnoy as Litigation Consultant ------------------------------------------------------------------ BankruptcyData.com reports that Washington Mutual's official committee of equity security holders filed with the U.S. Bankruptcy Court a motion to retain Professor Frank Partnoy, director of the Center on Corporate and Securities Law at the University of San Diego, as securities litigation consultant at a standard hourly rate of $850. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. On Jan. 7, 2011, the U.S. Bankruptcy Court for the District of Delaware entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan Chase Bank, N.A., upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. Additionally, the Opinion and related order denied confirmation, but suggested certain modifications to the Company's Sixth Amended Joint Plan of Affiliated Debtors that, if made, would facilitate confirmation. Washington Mutual has filed with the Bankruptcy Court a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement. The Company believes that the Modified Plan has addressed the Bankruptcy Court's concerns and looks forward to returning to the Bankruptcy Court to seek confirmation of the Modified Plan. WHITTLE DEVELOPMENT: Amended Reorganization Plan Confirmed ---------------------------------------------------------- American Bankruptcy Institute reports that a Texas judge has confirmed Whittle Development Inc.'s amended reorganization plan after requesting it make some last-minute changes. About Whittle Development Rockwall, Texas-based Whittle Development Inc. is a Sub Chapter S property development company wholly owned by Robert S. Whittle. It owns significant acreage in and around the northeastern shore of Lake Ray Hubbard, as well as other parts of Rockwall County, Texas. Its business is the sale and development of its holdings for highest and best uses of its land "inventory" to third party end users or other more direct developers. Whittle Development filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-37084) on Oct. 4, 2010. Whittle Development estimated its assets and debts at $10 million to $50 million at the Petition Date. Whittle Development's case is jointly administered with Rockwall, Texas-based Mariah Bay Development Inc., which is also a Sub Chapter S corporation wholly owned by Robert S. Whittle. Mariah Bay filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-37085) on Oct. 4, 2010. Mariah Bay estimated its assets and debts at $10 million to $50 million at the Petition Date. Edwin Paul Keiffer, Esq., at Wright Ginsberg Brusilow P.C., assists the Debtors in their restructuring efforts. Mariah Bay's affiliate, Mariah Bay Leasing Corporation, filed a separate Chapter 11 petition (Bankr. N.D. Tex. Case No. 10-31171) on Feb. 19, 2010. W.R. GRACE: Files Post-Confirmation Report for Second Quarter ------------------------------------------------------------- W.R. Grace & Co. and its debtor affiliates filed with the U.S. Bankruptcy Court for the District of Delaware a post-confirmation report for the quarter ended June 30, 2011. W.R. Grace & Co. Post-Confirmation Quarterly Summary Report For the Quarter Ended June 30, 2011 Beginning Cash Balance $580,820,307 All receipts received by the debtor: Cash Sales: - Collection of Accounts Receivable: 1,093,227,270 Proceeds from Litigation (settlement or otherwise): - Sale of Debtor's Assets: - Capital Infusion pursuant to the Plan: - -------------- Total of cash received: 1,093,227,270 -------------- Total of cash available: $1,674,047,577 ============== Less all disbursements or payments (including payments made under the Confirmed Plan) made by the Debtor: Disbursements made under the Plan, excluding the administrative claims of bankruptcy professionals: $0 Disbursements made pursuant to the administrative claims of bankruptcy professionals: 1,043,698,048 All other disbursements made in the ordinary course: - -------------- Total Disbursements 1,043,698,048 -------------- Ending Cash Balance $630,349,529 ============== A full-text copy of the Post-Confirmation Report is available for free at http://bankrupt.com/misc/WRG_PostCon_Report_June2011.pdf On January 31, 2011, Judge Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware issued an order confirming the Joint Plan of Reorganization proposed by the Debtors, and co-proposed by the Official Committee of Asbestos Personal Injury Claimants, the Official Committee of Equity Security Holders, and the Asbestos Future Claimants Representative. Several parties appealed from the Jan. 31 Order. Judge Ronald Buckwalter of the U.S. District Court for the District of Delaware is set to rule on the appeals. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on Jan. 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Paul Weiss Represents Holders of $369MM Debt -------------------------------------------------------- Andrew N. Rosenberg, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, in New York, informed the Court that his firm represents members of an informal group of holders of claims related to the Debtors' Prepetition Credit Facilities: Anchorage Advisors, LLC 610 Broadway, 6th Floor New York, NY 10012 Bank of America, N.A. 214 N. Fryson St. Charlotte, NC 28255 Bass Companies Wells Fargo Tower, Suite 3200 201 Main Street Fort Worth, TX 76102 Farallon Capital Management, LLC One Maritime Plaza, Suite 2100 San Francisco, CA 94111 Archer Capital Management, L.P. 570 Lexington Ave., 40th Floor New York, NY 10022 Barclays Bank PLC 1620 26th Street, Suite 2000N Santa Monica, CA 90404 Caspian Capital Advisors, LLC 500 Mamaroneck Avenue Harrison, NY 10528 Halcyon Master Fund L.P. 477 Madison Avenue, 8th Floor New York, NY 10022 Intermarket Corp. 660 Madison Avenue, 22nd Floor New York, NY 10065 Loeb Partners Corporation 61 Broadway, Suite 2400 New York, NY 10006 Massachusetts Mutual Life Insurance Company 1295 State Street Springfield, MA 01111 c/o Babson Capital Management, Inc. 680 Fifth Avenue, 26th Floor New York, NY 10019 Normandy Hill Capital, LP 150 East 52nd Street, 10th Floor New York, NY 10022 P. Schoenfeld Asset Management, LLC 1350 Avenue of the Americas, 21st Floor New York, NY 10019 Taconic Capital Advisors L.P. 450 Park Avenue, 9th Floor New York, NY 10022 JP Morgan Chase, N.A. Credit Trading Group 270 Park Avenue, 8th Floor New York, NY 10017 Macquarie Bank Limited 125 West 55th Street New York, NY 10019 MSD Credit Opportunity Master Fund, L.P. 645 Fifth Avenue, 21st Floor New York, NY 10022 Onex Debt Opportunity Fund, Ltd. 910 Sylvan Avenue Englewood Cliffs, NJ 07632 Royal Bank of Scotland, PLC 600 Steamboat Road Greenwich, CT 06830 Visium Asset Management, LP 950 Third Avenue, 29th Floor New York, NY 10022 Mr. Rosenberg says the nature of the claims held by the Bank Debt Holders against the Debtors includes, but is not limited to, claims for principal, interest and expenses on the loans and advances under the Debtors' Prepetition Bank Credit Facilities. The Bank Debt Holders collectively hold approximately $369 million of $500 million in outstanding principal, or approximately 67%, of the loans and advances made under the Prepetition Bank Credit Facilities, he adds. About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on Jan. 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) W.R. GRACE: Opens Manufacturing Facility in Gurgaon, India ---------------------------------------------------------- Grace Construction Products, an operating segment of W. R. Grace & Co. (NYSE: GRA), has started manufacturing from a new facility near Delhi, India. This site's development is part of Grace's ongoing growth strategy to invest in emerging regions. Employees at this location manufacture cement additives and concrete admixtures that are sold to cement and concrete manufacturers in Northern India. Grace's cement additives help cement producers improve grinding efficiency and overall cement quality. The company's concrete admixtures improve the quality, strength, durability and appearance of concrete. These products help to build stronger structures in more energy efficient ways, which helps to reduce manufacturing costs. "We continue to invest in emerging economies in order to meet our customers' needs," said Andrew Bonham, President of Grace Construction Products. "The new facility will allow us to enhance service and delivery times to our customers in Northern India." Plant Manager Ajay Kapoor stated, "Our number one priority is to provide a safe environment and safe practices at the site. We must ensure our company culture extends throughout all our facilities from safety to product quality to community outreach." This facility is the most recent addition in a series of emerging market investments in the construction industry for Grace. The company has opened similar facilities in China, Colombia, Panama, Saudi Arabia and Vietnam since 2010. Also in 2010, Grace acquired a manufacturer of waterproofing products located in Central China and formed a construction joint venture in the Kingdom of Saudi Arabia. The address for the new India site is: W. R. Grace & Co. (India) Pvt. Ltd, Plot No. - 90, Sector 8, IMT Manesar, Gurgaon (Haryana) 122050, India. W. R. Grace & Co. (India) Pvt. Ltd. opened its first office in India in Bangalore in 1994. Today, Grace has three plants, six offices and one laboratory in India that collectively support customers from all of the company's product groups. About Grace Construction Products Grace Construction Products is a world-leading provider of construction chemicals and building materials that are used to enhance the durability, strength and appearance of structures all over the world. Products include concrete admixtures, fibers, surface treatments and liquid pigments, additives for cement processing, and fire protection, waterproofing and masonry products. More information is available online at http://www.graceconstruction.com/ About W.R. Grace & Co. Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for Chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring effort. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace and its debtor affiliates, with the support of the Official Committee of Asbestos Personal Injury Claimants, the Asbestos PI Future Claimants' Representative and the Official Committee of Equity Security Holders, have submitted a proposed Chapter 11 plan of reorganization. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. The Plan confirmation hearing wrapped up on Jan. 25. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) YELLOW MEDIA: S&P Lowers Corporate Credit Rating to 'BB+' --------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Montreal-based Yellow Media Inc. to 'BB+' from 'BBB-'. The outlook is stable. At the same time, Standard & Poor's lowered its ratings on the company's senior unsecured debt to 'BB+' (the same as the corporate credit rating on Yellow Media) from 'BBB-' and assigned its recovery rating of '3' to the debt. The 3' recovery rating reflects an expectation of meaningful (50%-70%) recovery in the event of a default. "We also lowered our rating on Yellow Media's subordinated debt to 'BB-' (two notches below the corporate credit rating) from 'BB+' and assigned our '6' recovery rating to these obligations, indicating our expectation of negligible (0%-10%) recovery in a default situation. Finally, we lowered our Canada scale rating on the company's preferred shares to 'P-4 (High)' from 'P-3'. At June 30, the company had about C$2.6 billion of debt and about C$750 million of preferred shares outstanding," S&P related. "The downgrade primarily reflects our weaker view of Yellow Media's business risk profile," said Standard & Poor's credit analyst Madhav Hari. "Specifically, we believe that secular pressures on the company's print revenue are poised to accelerate in the next couple of years and that Yellow Media will be challenged to offset such losses through growth in online and digital offerings where competition is intense and new online channels are quickly evolving," Mr. Hari added. "We also expect Yellow Media's profitability and cash flow to weaken from our previous expectations as advertisers scale back from higher-margin premium print revenue and the company faces higher initial costs to launch new services. Finally, in our opinion, rising industry and competitive risks have materially reduced revenue visibility and increased the potential for significant earnings volatility for the company for the foreseeable future. Although Yellow Media's actions to cut dividends by 77% and aggressively deleverage its balance sheet (reported net debt to EBITDA of 2x) provide some offset, we do not believe that it is a sufficient risk mitigant," S&P related. The ratings on Yellow Media reflect what Standard & Poor's views as the company's "fair" business risk profile, supported by its position as the leading publisher of Yellow Pages classified directories in Canada, servicing close to 35% of businesses within its markets; its strong brands and healthy portfolio of websites (and partners); established marketing and distribution capabilities given its 1,800-person sales force and about 370,000 advertising customers; reasonable execution to date as it relates to developing new online/digital local advertising platforms and marketing solutions to mitigate print pressures; and its historical track record of sustaining strong profit margins and generating meaningful cash flow at its core directory operations. "The ratings also reflect our view of Yellow Media's 'significant' financial risk profile based on its strong liquidity position and adoption of more conservative financial policies, as well as our expectation of its ability to generate meaningful discretionary cash flow in the next few years, which we believe should provide the company with sufficient financial flexibility for reinvestment or debt reduction," S&P related. "The stable outlook reflects our expectation that, although we do not expect print declines to be fully offset by online and digital revenue growth, we believe overall organic revenue erosion can be contained to the mid-single digits and that the company can manage its EBITDA margins at the low-50% level over the next couple of years. Under these parameters, we believe that Yellow Media should be able to generate meaningful free operating cash flow for debt repayment and reinvestment. Following the planned debt reduction from the Trader asset sale and additional (deleveraging) flexibility from internal cash flow, we believe the company can sustain a relatively healthy balance sheet (adjusted debt leverage below 3x and adjusted funds from operations to debt approaching mid-20%) in the near term. A downgrade would result from a further acceleration of overall revenue erosion (from our current assumption) or a failure of the company to deleverage to our expectations by the end of calendar 2012. A near-term upgrade is not likely given our concerns about increasing industry risks and the prospect of increased earnings volatility over the foreseeable future," S&P added. YRC WORLDWIDE: Announces Composition of Board Committees -------------------------------------------------------- As previously reported by the TCR on Aug. 1, 2011, YRC Worldwide Inc. disclosed, among other things, that Raymond J. Bromark, Douglas A. Carty, Matthew A. Doheny, Robert L. Friedman, James E. Hoffman, Michael J. Kneeland, James L. Welch, Harry J. Wilson and James F. Winestock were appointed to the Board of Directors of the Company, effective July 22, 2011. At the time of that filing, the Board had not yet determined the composition of the Board committees. Effective July 28, 2011, the Board made the following committee appointments: * Messrs. Raymond Bromark, Douglas Carty and Robert Friedman will serve on the Audit/Ethics Committee with Mr. Bromark serving as Chairman. The Board has further determined that each of Messrs. Bromark, Carty and Friedman is an "audit committee financial expert," as that term is defined under Securities and Exchange Commission regulations, and that each of them meets the financial sophistication requirement of the NASDAQ Stock Market rules. * Messrs. Michael Kneeland, Matthew Doheny and James Hoffman will serve on the Compensation Committee with Mr. Kneeland serving as Chairman. * Messrs. Winestock, Carty and Kneeland will serve on the Governance Committee with Mr. Winestock serving as Chairman. * Messrs. Doheny, Friedman and Wilson will serve on the Finance Committee with Mr. Doheny serving as the Chairman. About YRC Worldwide Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ: YRCW) -- http://www.yrcw.com/-- is a holding company that through wholly owned operating subsidiaries offers its customers a wide range of transportation services. These services include global, national and regional transportation as well as logistics. KPMG LLP's audit reports on the consolidated financial statements of YRC Worldwide Inc. and subsidiaries for 2009 and 2010 each contain an explanatory paragraph that states that the Company has experienced significant declines in operations, cash flows and liquidity and these conditions raise substantial doubt about the Company's ability to continue as a going concern. The Company's balance sheet at March 31, 2011, showed $2.62 billion in total assets, $2.91 billion in total liabilities, and a $287.64 million total shareholders' deficit. * * * In January 2011, Standard & Poor's Ratings Services placed its 'CCC-' corporate credit rating on YRC Worldwide Inc. (YRCW) on CreditWatch developing. At the same time, S&P is withdrawing the existing issue level ratings on Yellow Corp.'s senior unsecured debt, given the negligible amounts outstanding. "The ratings on Overland Park, Kan.-based YRCW reflect its near- term liquidity challenges, meaningful off-balance-sheet contingent obligations related to multiemployer pension plans, as well as its participation in the competitive, capital-intensive, and cyclical trucking industry," said Standard & Poor's credit analyst Anita Ogbara. "YRCW's substantial (albeit deteriorating) market position in the less-than-truckload (LTL) sector, which has high barriers to entry, partially offsets these characteristics. We characterize YRCW's business profile as weak, financial profile as highly leveraged, and liquidity as weak." In the Aug. 2, 2011, edition of the TCR, Moody's Investors Service revised YRC Worldwide Inc.'s Probability of Default Rating ("PDR") to Caa2\LD ("Limited Default") from Caa3 in recognition of the agreed debt restructuring which will result in losses for certain existing debt holders. In a related action Moody's has raised YRCW's Corporate Family Rating to Caa3 from Ca to reflect modest but critical improvements in the company's credit profile that should result from its recently-completed financial restructuring. The positioning of YRCW's PDR at Caa2\LD reflects the completion of an offer to exchange a substantial majority of the company's outstanding credit facility debt for new senior secured credit facilities, convertible unsecured notes, and preferred equity, which was completed on July 22, 2011. As reported by the TCR on May 5, 2011, Fitch Ratings downgraded YRC's Issuer default rating to 'C' from 'CC'; Secured bank credit facility rating downgraded to 'CCC/RR2' from 'B-/RR2'; and Senior unsecured rating affirmed at 'C/RR6'. In addition, Fitch has removed YRCW's ratings from Rating Watch Negative. Fitch said that although it appears increasingly likely that the company will successfully complete the restructuring, until the transactions constituting the restructuring close, which is not anticipated until late July 2011, there exists a potential for the transaction to fail, in which case Fitch expects the company would be forced to file for Chapter 11 bankruptcy protection. * Business Bankruptcies Down 13% From Last Year ----------------------------------------------- Carolina Bolado at Bankruptcy Law360 reports that the Administrative Office of the U.S. Courts reported Friday that business bankruptcies had dropped 13% in the year-long period ending June 30, amid an overall decline in both personal and business filings. New bankruptcy filings by businesses fell to a total of 52,134, a decrease from the 59,608 that occurred in the same period ending June 30, 2010, according to the report obtained by Law360. Bankruptcy filings dropped 2.7% overall in the past year, largely thanks to a decline in personal bankruptcy. * Ex Birmingham, Ala. Mayor's Bribery Conviction Appeal Denied -------------------------------------------------------------- Megan Leonhardt at Bankruptcy Law360 reports that the Eleventh Circuit on Friday rejected a former Birmingham, Ala., mayor's bid to overturn his 15-year prison sentence for allegedly participating in a multibillion-dollar bid-rigging scheme that is at the heart of a county's current bankruptcy woes. Larry P. Langford, who also once served as the former commissioner for Jefferson County, Ala., came up short in his appeal, with the court denying his arguments that the jury had been unfairly prejudiced, according to Law360. * S&P Speculative-Grade Composite Spread Widens to 609 Bps ---------------------------------------------------------- Standard & Poor's speculative-grade composite spread widened by 3 basis points (bps) to 609 bps, while the investment-grade composite spread widened by 1 bp to 176 bps. By rating, the 'AA' and 'A' spreads expanded by 1 bp each to 124 bps and 155 bps, respectively. The 'BBB' spread widened by 2 bps to 211 bps. The 'BB' spread remained flat at 436 bps. The 'B' spread widened by 2 bps to 653 bps, and the 'CCC' spread expanded by 4 bps to 918 bps. By industry, financial institutions expanded by 9 bps to 285 bps. Banks widened by 5 bps to 257 bps. Industrials expanded by 3 bps to 284 bps. Utilities widened by 1 bp to 183 bps. Telecommunications expanded by 4 bps to 298 bps. The speculative-grade composite spread reached a new high for the year on Aug. 3 and has subsequently widened by an additional 5%. The investment-grade composite spread is currently hovering slightly below its high of 177 bps, which was last reached on Jan. 10, 2011. S&P expects continued volatility in the near term, especially in the speculative-grade segment, which could result from both positive and negative factors. On the positive side, investor demand for new issuance has remained strong this year. On the negative side, an increase in volatility in the financial markets, influenced partially by sovereign rating concerns, could continue to weigh on risky assets. * S&P's U.S. Downgrade Doesn't Affect Top-Rated Corporate Issuers ------------------------------------------------------------------ Standard & Poor's Ratings Services said Aug. 5 that it lowered its long-term sovereign credit rating on the United States of America to 'AA+' with a negative rating outlook. The sovereign downgrade will not affect the ratings or stable rating outlooks on the six U.S.-domiciled highest-rated nonfinancial corporate issuers: Automatic Data Processing Inc. (ADP; AAA/Stable/A-1+), ExxonMobil Corp. (AAA/Stable/A-1+), Johnson & Johnson (AAA/Stable/A-1+), Microsoft Corp. (AAA/Stable/A-1+), General Electric Co. (AA+/Stable/A-1+), and W.W. Grainger Inc. (AA+/Stable/A-1+). WHY THERE IS NO IMPACT ON OUR TOP-RATED U.S. INDUSTRIALS According to Standard & Poor's criteria, ratings on a nonfinancial corporate borrower may exceed those on the sovereign if S&P expects the borrower to continue to fulfill its financial obligations, even in a sovereign default scenario. Depending on the industry sector or individual company's financial strength, a company may be better or less able to withstand macroeconomic shocks or other country-related risks. "In considering corporate ratings vis-a-vis the sovereign rating, we consider how exposed a company would be to a typical sovereign stress scenario, which, in the past, has included: sharp currency movements, credit shortages, a weakened banking sector, higher government taxes and fees, late or partial payments from the public sector, a more difficult regulatory environment, economic contraction, and rising inflation and interest rates," S&P said. "Corporate entities that we would typically consider to be most exposed to country risk include firms with mainly domestic customers, highly cyclical companies or companies for which profitability is highly correlated with the general condition of the economy, and companies with high exposures to government sector customers. Corporate entities that typically are least exposed to country risk include globally diversified companies and export-oriented companies. Local economic conditions have less of an effect on such companies, and they generally benefit from currency depreciation," S&P explained. "Given the global and diverse business lines and significant financial strength of Exxon Mobil, Johnson & Johnson, Microsoft, and General Electric, the sovereign downgrade of the U.S. does not have an impact on our ratings and rating outlooks for these U.S. domiciled corporate issuers," S&P said. They enjoy 'excellent' business risk profiles (see "Business Risk/Financial Risk Matrix Expanded," published May 27, 2009), with end-market diversity, diversity of product and service lines, and a track record of solid profitability, along with "minimal" or "modest" financial risk, with significant cash flow from various businesses and substantial liquidity. In addition, the U.S.'s transfer and convertibility assessment remains 'AAA' following the sovereign downgrade. (See "Methodology: Criteria for Determining Transfer and Convertibility Assessments," May 18, 2009--"Ratings Above the Sovereign's" section. Also see "2008 Corporate Criteria: Analytical Methodology," April 15, 2008--"Country Risk" section.) Although there is no direct impact on S&P's credit ratings on these companies from the U.S. sovereign rating action, a weakening macroeconomic scenario would negatively affect the U.S. segments of their businesses to some degree. There is also no current impact on S&P's ratings or rating outlooks for ADP and W.W. Grainger from the rating action on the U.S. Although most of these companies' revenues come from within the U.S. and they are less diversified by product line and geographical business mix than the previously mentioned companies, ADP and Grainger both enjoy high customer and end-market diversification and have revenue bases that held up well during the recent recession. In addition, they have minimal reliance on the public sector, with a set of products for which demand is relatively inelastic. S&P DID LOWER RATINGS ON THE GOVERNMENT-RELATED ENTITITES In conjunction with the sovereign downgrade, S&P lowered its ratings on the three government-related entities (GREs): Army & Air Force Exchange Service (AAFES), Marine Corps Community Services (MCCS), and Navy Exchange Service Command (NESC) to 'AA-' from 'AA', in keeping with Standard & Poor's criteria on GREs. The rating outlook on AAFES is stable, while the outlooks on MCCS and NESC are negative. The stable outlook for AAFES reflects its better stand-alone credit profile than the other two GREs. The likelihood of extraordinary government support for these entities, in our assessment, would remain very high. (See Standard & Poor's individual research reports on these entities published earlier Aug. 8.) THE EFFECT ON CERTAIN DEBT INSTRUMENTS The U.S. sovereign downgrade also had an effect on the credit ratings of certain specific debt instruments. Most common among the affected obligations were: -- BONDS SUPPORTED BY THE FEW REMAINING 'AA+' RATED BOND INSURERS. S&P revised the rating outlooks on the 'AA+' bond insurers, which include Assured Guaranty (Europe) Ltd., Assured Guaranty (UK) Limited, Assured Guaranty Corp., Assured Guaranty Municipal Corp., and Berkshire Hathaway Assurance Corp., to negative from stable. In conjunction with this outlook change, S&P also revised the rating outlooks on the project finance bonds backed by these insurers to negative. -- DEFEASED BONDS. These are bonds for which the borrower sets aside cash to pay them off. S&P lowered its ratings on defeased bonds backed by U.S. Treasury securities to 'AA+' from 'AAA'. THE IMPACT ON DEFENSE CONTRACTORS AND MEDICARE PROVIDERS The recently enacted bill that increases the federal debt limit includes a $350 billion reduction to previous planned "security spending" over the next 10 years. Given that the $350 billion is spread among a number of security sectors, including the Department of Defense, and is mainly back-end loaded, Standard & Poor's believes there will be only a modest impact on the credit quality of most defense contractors. A more significant impact on the credit quality of companies in the defense industry could occur if Congress does not specify additional cuts to the overall federal budget by the end of the year or pass a balanced budget amendment. In these cases, security spending could be cut by an additional $500 billion, possibly resulting in across-the-board cuts to weapons programs. In response to possible lower defense spending, military contractors have been reducing costs to preserve profitability and remain competitive, as well as attempting to increase foreign sales. (See "Planned Cuts To The U.S. Defense Budget Are Likely To Have A Modest Impact On Military Contractors' Credit Quality," Aug. 2, 2011) Significant cuts to Medicare are likely, either as part of a special Congressional committee's $1.5 trillion in spending cuts or as part of the backup plan if the committee fails to come to an agreement. This would be in addition to cuts that the Affordable Care Act of 2010 already require, such as a $155 billion cut in Medicare payments to hospitals over 10 years. Medicare has more than doubled in cost over the past 10 years, to about $550 billion annually. S&P has long considered government efforts to rein in such expenditures as a key rating risk for health care providers. Still, surprising government actions, such as the recently announced 11% nursing home cuts, can lead to credit deterioration. S&P placed all six of its rated for-profit nursing home companies on CreditWatch with negative implications as a result of this announcement. Providers that have exposure to Medicare are likely to remain at risk of more sparing reimbursement, as long as budgetary pressures persist (see "The Deficit Remedy May Be Toxic for U.S. Health Care Companies," to be published shortly on RatingsDirect). * S&P Ratings on U.S. Banks Unaffected by Sovereign Downgrade ------------------------------------------------------------- Standard & Poor's Ratings Services said Aug. 8 that the Aug. 5 lowering of the United States of America sovereign credit rating to 'AA+' from 'AAA' does not have an immediate or direct impact on our ratings on U.S. banks (see The Implications of the U.S. debt Ceiling Standoff For Global Financial Institutions, published July 21, 2011, on RatingsDirect on the Global Credit Portal). None of the banks S&P rates in the U.S. has an issuer credit rating higher than the U.S. sovereign rating. The sovereign downgrade does not alter the government support assumptions that S&P factors into its ratings on four banks. * S&P Cuts Housing Issues Backed by Fannie, Freddie to 'AA+' ------------------------------------------------------------ Standard & Poor's Ratings Services said Aug. 8 it lowered the ratings on certain public finance debt issues that have credit enhancement guaranteed by Federal National Mortgage Association and Federal Home Loan Mortgage Corp. to 'AA+/A-1+' from 'AAA/A-1+' following the downgrade of Fannie Mae and Freddie Mac to 'AA+/Negative/A-1+'. The outlook is negative. The rating on the affected debt issues is based on the rating on either Fannie Mae or Freddie Mac, which either guarantees direct payment on the bonds, or in some circumstances, guarantees mortgage payments in the event of a mortgage default. In the cases of the affected issues, the guarantee is irrevocable and is in place until bond maturity. As such, the bonds carry the rating on Fannie Mae or Freddie Mac. Among the bonds whose ratings have been lowered are bonds issued by the housing finance agencies' New Issues Bond Program through which bonds are enhanced in the form of the Temporary Credit & Liquidity Program (TCLP). Under the TCLP, there is one master irrevocable standby temporary credit and liquidity facility issued by both Fannie Mae and Freddie Mac in favor of the trustee. The facility guarantees both credit and liquidity on the bonds. As such, pursuant to our criteria, the ratings on the issues follow the ratings on Fannie Mae and Freddie Mac. The list of affected ratings is posted at: http://www.standardandpoors.com/ratings/govs-uspf/en/us/ Click "Rating Actions On Municipal Housing-Related Issues" and select the tab Freddie, FNMA. * S&P Lowers Ratings on 5 Insurance Groups After U.S. Downgrade --------------------------------------------------------------- Standard & Poor's Ratings Services said Aug. 8 that it lowered to 'AA+' from 'AAA' its long-term counterparty credit and financial strength ratings on the member companies of five U.S. insurance groups: Knights of Columbus, New York Life, Northwestern Mutual, Teachers Insurance & Annuity Assoc. of America (TIAA), and United Services Automobile Assoc. (USAA). The outlooks on the ratings on all of these companies are negative. Standard & Poor's also said that it lowered the ratings on approximately $17 billion of securities issued by New York Life, Northwestern Mutual, TIAA, USAA, and their affiliates. At the same time, Standard & Poor's affirmed the 'AA+' ratings on the members of five other insurance groups -- Assured Guaranty, Berkshire Hathaway, Guardian, Massachusetts Mutual, and Western & Southern -- and revised the outlooks on ratings on these companies to negative from stable. The rating actions on these 10 insurance groups follow the lowering of the long-term sovereign credit rating on the United States of America to 'AA+' from 'AAA' (see "United States of America Long-Term Rating Lowered To 'AA+' On Political Risks And Rising Debt Burden; Outlook Negative," Aug. 5, 2011.) "We factor direct and indirect sovereign risks -- such as the impacts of macroeconomic volatility, currency devaluation, asset impairments, and investment portfolio deterioration -- into our financial strength ratings. Per our criteria, the sovereign local-currency credit rating constrains our financial strength ratings on insurers (see "Counterparty Credit Ratings And The Credit Framework," April 14, 2004). The 10 affected insurance groups operate in the U.S. and generally have significant holdings of U.S. Treasury and agency securities. For the insurers with the most exposure, these investments constituted as much as 200% of total adjusted capital at year-end 2010," S&P said. "In our opinion, very strong financial profiles and favorable business profiles support the 'AA+' ratings on the 10 affected U.S. insurance groups. In our view, these companies maintain very strong capital and liquidity. In addition, we believe that the significant retail insurance liabilities -- such as whole life insurance and deferred annuities -- that some of these companies have are less prone to withdrawals or surrenders than institutional liabilities. Knights of Columbus, TIAA, and USAA also benefit from affinity relationships with their policyholders, which enhance the persistency of liabilities. "Our view of these companies' fundamental credit characteristics has not changed. Rather, the rating actions reflect the application of criteria and our view that the link between the ratings on these entities and the sovereign credit ratings on the U.S. could lead to a decline in the insurers' financial strength. This is because these companies' businesses and assets are highly concentrated in the U.S." For related rating actions on other U.S. financial services companies, select GSEs, and funds, see "Ratings On Select GREs And FDIC- And NCUA-Guaranteed Debt Lowered After Sovereign Downgrade," also published Aug. 8. According to S&P, "Under our criteria, the local-currency sovereign credit rating on the U.S. constrains the ratings on domestic insurance operating and holding companies. If we were to lower our rating on the U.S. again, we would likely take the same rating action on the affected insurers and their related obligations. Alternatively, if we were to revise the rating outlook on the U.S. to stable, we would likely revise the outlook on the affected insurers to stable, assuming there is no deterioration in a particular insurer's business and financial profiles." RATINGS LIST Ratings Lowered And Removed From CreditWatch Negative To From -- ----- Knights of Columbus Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg New York Life Insurance Co. Counterparty Credit Rating AA+/Negative/A-1+ AAA/Watch Neg/A-1+ Financial Strength Rating AA+/Negative AAA/Watch Neg Subordinated Debt AA- AA/Watch Neg New York Life Insurance & Annuity Corp. Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg New York Life Funding New York Life Global Funding Senior Secured AA+ AAA/Watch Neg Northwestern Mutual Life Insurance Co. Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg Subordinated Debt AA- AA/Watch Neg Northwestern Long Term Care Insurance Co. Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg Teachers Insurance & Annuity Assoc. of America Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg Senior Unsecured AA+ AAA/Watch Neg Subordinated Debt AA- AA TIAA-CREF Life Insurance Co. Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg United Services Automobile Assoc. USAA Casualty Insurance Co. USAA General Indemnity Co. USAA Life Insurance Co. USAA Life Insurance Co. of New York Counterparty Credit Rating AA+/Negative/-- AAA/Watch Neg/-- Financial Strength Rating AA+/Negative AAA/Watch Neg USAA Capital Corp. Counterparty Credit Rating AA+/Negative/A-1+ AAA/Watch Neg/A-1+ Senior Unsecured AA+ AAA/Watch Neg Commercial Paper A-1+ A-1+ Ratings Affirmed; Outlook Revised To Negative To From -- ----- Assured Guaranty Ltd. Counterparty Credit Rating A+/Negative/-- A+/Stable/-- Junior Subordinated Debt A- ASenior Unsecured Debt A+ A+ Assured Guaranty (Bermuda) Ltd. Assured Guaranty (Europe) Ltd. Assured Guaranty (UK) Ltd. Assured Guaranty Corp. Assured Guaranty Municipal Corp. Assured Guaranty Municipal Insurance Co. Counterparty Credit Rating AA+/Negative/-- AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Financial Enhancement Rating AA+/Negative AA+/Stable Berkshire Hathaway Inc. Counterparty Credit Rating AA+/Neg./A-1+ AA+/Stable/A-1+ Senior Unsecured AA+ AA+ Commercial Paper A-1+ A-1+ Berkshire Hathaway International Insurance Ltd. Counterparty Credit Rating AA+/Neg./A-1+ AA+/Stable/A-1+ Financial Strength Rating AA+/Negative AA+/Stable Berkshire Hathaway Life Insurance Co. of NE Columbia Insurance Co. Counterparty Credit Rating AA+/Neg./-- AA+/Stable/-- Financial Strength Rating AA+/Neg./-- AA+/Stable/-- Financial Enhancement Rating AA+/Neg. AA+/Stable GEICO Corp. Counterparty Credit Rating AA+/Negative/-- AA+/Stable/-- Senior Unsecured AA+ AA+ General Re Corp. Counterparty Credit Rating AA+/Neg./A-1+ AA+/Stable/A-1+ Commercial Paper A-1+ A-1+ General Re Financial Products Corp. National Re Corp. Counterparty Credit Rating AA+/Negative/-- AA+/Stable/-- Berkshire Hathaway Assurance Corp. Financial Strength Rating AA+/Negative AA+/Stable Financial Enhancement Rating AA+/Negative AA+/Stable National Fire & Marine Insurance Co. Counterparty Credit Rating AA+/Negative/-- AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Financial Enhancement Rating AA+/Negative AA+/Stable Central States Indemnity Co. of Omaha Continental Divide Insurance Co. Cornhusker Casualty Co. CSI Life Insurance Co. Cypress Insurance Co. (CA) Fairfield Insurance Co. GEICO Casualty Co. GEICO General Insurance Co. GEICO Indemnity Co. General Reinsurance AG General Reinsurance Australia Ltd. General Reinsurance Corp. General Star Indemnity Co. General Star National Insurance Co. Genesis Indemnity Insurance Co. Genesis Insurance Co. Government Employees Insurance Co. Kansas Bankers Surety Co. Medical Protective Co. National Indemnity Co. National Indemnity Co. of Mid-America National Indemnity Co. of the South National Liability & Fire Insurance Co. National Reinsurance Corp. Redwood Fire & Casualty Insurance Co. Wesco-Financial Insurance Co. Counterparty Credit Rating AA+/Negative/--AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Faraday Reinsurance Co. Ltd. General Re Life Corp. General Reinsurance Africa Ltd. General Reinsurance Life Australia Ltd. Financial Strength Rating AA+/Negative AA+/Stable Guardian Insurance & Annuity Co. Berkshire Life Insurance Co. of America Counterparty Credit Rating AA+/Negative/--AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Guardian Life Insurance Co. of America Counterparty Credit Rating AA+/Negative/--AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Subordinated Debt AA- AA Massachusetts Mutual Life Insurance Co. Counterparty Credit Rating AA+/Neg./A-1+ AA+/Stable/A-1+ Financial Strength Rating AA+/Negative AA+/Stable Commercial Paper A-1+ A-1+ Subordinated Debt AA- AAC. M. Life Insurance Co. MML Bay State Life Insurance Co. Counterparty Credit Rating AA+/Neg./-- AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Western & Southern Financial Group Inc. Counterparty Credit Rating AA-/Negative/--AA-/Stable/-- Senior Unsecured AA- AA Western and Southern Life Insurance Co. Western-Southern Life Assurance Co. Columbus Life Insurance Co. Integrity Life Insurance Co. National Integrity Life Insurance Co. Counterparty Credit Rating AA+/Negative/-- AA+/Stable/-- Financial Strength Rating AA+/Negative AA+/Stable Lafayette Life Insurance Co. Financial Strength Rating AA+/Negative AA+/Stable * Weiss Ratings Credits S&P for Important First Step ---------------------------------------------------- Weiss Ratings, the nation's leading independent rating agency of U.S. financial institutions, credits Standard & Poor's for taking an important first step in the right direction, while renewing its public challenge to Moody's and Fitch to downgrade the long-term debt of the U.S. government. The Weiss Ratings Challenge, reissued today, was initially made to all three credit rating agencies on May 10, 2010, or 15 months before S&P announced its downgrade of U.S. debt from AAA to AA+ last Friday. Weiss Ratings president Dr. Martin D. Weiss commented: "S&P deserves credit for breaking with nearly a century of precedent and focusing the world's attention on the urgency of this problem. However, we do not believe a one-notch downgrade adequately reflects the rapid deterioration of the nation's finances since the debt crisis of 2008." Although a downgrade can have negative short-term repercussions, Weiss believes the consequences of procrastination can be far more serious, while an honest rating can be constructive for the country in the long term. Addressing the major credit rating agencies, he wrote: "To the degree that you continue to reaffirm stellar ratings for U.S. debt, you help entice millions of hard-working citizens, retirees, and their intermediaries to pour more money into a potential debt trap; or at best, to be severely underpaid for the actual risks they are taking. You give policymakers a green light to perpetuate their fiscal follies, further degrading our government's ability to meet future obligations. And you help create a false sense of security overall -- the recipe for a possible meltdown in the market for U.S. sovereign debts." On April 28, 2011, almost one year after issuing its initial challenge to the major ratings agencies, Weiss Ratings introduced the Weiss Sovereign Debt Ratings, giving the United States a grade of C, and subsequently, with its release of July 15, 2011, Weiss Ratings downgraded U.S. debt to C- (approximately equivalent to a BBB- at S&P). Weiss Ratings senior financial analyst Gavin Magor commented: "The U.S. is facing some of its greatest financial challenges of modern times, while global investors continue to take very substantial risks when buying medium- and long-term U.S. government securities. These include the risks of currency devaluation, reduced bond market liquidity, bond price declines, and rapidly escalating costs of insuring against a possible future default." Today, Weiss Ratings reaffirmed its C- rating of U.S. medium- and long-term debt. Among the 49 sovereign nations covered, the United States continues to score very low in terms of its debt burdens, macro-economic trends, and international stability, while still getting a relatively high grade for the broad acceptance and marketability of its debt securities. About Weiss Ratings Weiss Ratings is the nation's leading independent provider of bank, credit union and insurance company financial strength ratings, accepting no payments for its ratings from rated institutions. Weiss Ratings also provides debt ratings on 49 sovereign nations. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- A&W REV ROYAL-UT AWRRF US 179.2 (147.6) 3.6 A&W REV ROYAL-UT AW-U CN 179.2 (147.6) 3.6 ABSOLUTE SOFTWRE ABT CN 116.3 (12.0) (12.6) ACCO BRANDS CORP ABD US 1,094.2 (77.0) 293.1 ALASKA COMM SYS ALSK US 609.8 (27.4) 6.3 AMER AXLE & MFG AXL US 2,167.8 (415.4) 60.4 AMR CORP AMR US 25,787.0 (4,509.0) (1,769.0) ANOORAQ RESOURCE ARQ SJ 1,024.0 (77.0) 20.9 AUTOZONE INC AZO US 5,884.9 (1,119.5) (655.3) BLUEKNIGHT ENERG BKEP US 323.5 (35.1) (85.8) BOSTON PIZZA R-U BPF-U CN 148.2 (100.1) 1.3 CABLEVISION SY-A CVC US 8,962.9 (6,462.4) (309.5) CADIZ INC CDZI US 46.7 (2.1) 2.1 CANADIAN SATEL-A XSR CN 174.4 (29.8) (55.9) CC MEDIA-A CCMO US 16,938.6 (7,280.4) 1,644.2 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) CENVEO INC CVO US 1,439.5 (333.5) 208.1 CHENIERE ENERGY CQP US 1,776.3 (547.6) 24.4 CHENIERE ENERGY LNG US 2,564.4 (509.7) 87.4 CHOICE HOTELS CHH US 412.4 (49.0) (1.9) CINCINNATI BELL CBB US 2,636.2 (650.4) 6.4 CLOROX CO CLX US 4,051.0 (82.0) (28.0) COLUMBIA LABORAT CBRX US 27.8 (2.6) 11.5 DENNY'S CORP DENN US 296.8 (102.3) (36.9) DIRECTV-A DTV US 20,593.0 (678.0) 2,813.0 DISH NETWORK-A DISH US 10,280.6 (502.5) 705.1 DISH NETWORK-A EOT GR 10,280.6 (502.5) 705.1 DOMINO'S PIZZA DPZ US 487.4 (1,167.7) 167.9 DUN & BRADSTREET DNB US 1,825.5 (615.8) (321.8) EPICEPT CORP EPCT SS 12.4 (6.0) 6.0 EXELIXIS INC EXEL US 495.7 (68.7) 126.1 FRANCESCAS HOLDI FRAN US 59.1 (55.5) 13.2 FREESCALE SEMICO FSL US 4,583.0 (4,401.0) 1,329.0 GENCORP INC GY US 987.3 (161.1) 94.3 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GRAHAM PACKAGING GRM US 2,943.5 (501.5) 313.1 HANDY & HARMAN L HNH US 372.2 (23.9) 13.2 HCA HOLDINGS INC HCA US 23,877.0 (7,534.0) 2,613.0 HUGHES TELEMATIC HUTC US 108.8 (62.4) (16.0) IDENIX PHARM IDIX US 54.9 (40.6) 19.6 INCYTE CORP INCY US 459.6 (104.0) 315.8 IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 131.7 (161.7) 6.6 JUST ENERGY GROU JE CN 1,588.6 (219.4) (303.2) KNOLOGY INC KNOL US 823.7 (4.0) 42.7 LIN TV CORP-CL A TVL US 797.4 (127.9) 38.6 LIZ CLAIBORNE LIZ US 1,255.8 (124.5) (26.5) LORILLARD INC LO US 2,498.0 (831.0) 904.0 MAINSTREET EQUIT MEQ CN 475.2 (10.5) - MANNKIND CORP MNKD US 254.8 (203.5) 26.2 MEAD JOHNSON MJN US 2,465.4 (250.4) 572.3 MERITOR INC MTOR US 2,675.0 (1,006.0) 205.0 MOODY'S CORP MCO US 2,524.4 (223.2) 498.6 MORGANS HOTEL GR MHGC US 692.8 (29.2) 205.1 MPG OFFICE TRUST MPG US 2,725.0 (1,082.2) - NATIONAL CINEMED NCMI US 796.4 (327.0) 74.0 NAVISTAR INTL NAV US 9,966.0 (764.0) 1,819.0 NEXSTAR BROADC-A NXST US 582.6 (181.2) 40.0 NPS PHARM INC NPSP US 158.3 (159.7) 117.8 NYMOX PHARMACEUT NYMX US 10.0 (3.3) 6.8 ODYSSEY MARINE OMEX US 25.7 (8.1) (14.0) OTELCO INC-IDS OTT US 319.2 (7.6) 22.4 OTELCO INC-IDS OTT-U CN 319.2 (7.6) 22.4 PALM INC PALM US 1,007.2 (6.2) 141.7 PDL BIOPHARMA IN PDLI US 248.7 (371.2) (161.6) PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PRIMEDIA INC PRM US 208.0 (91.7) 3.6 PROTECTION ONE PONE US 562.9 (61.8) (7.6) PURE INDUSTRIAL AAR-U CN 277.1 (8.6) - QUALITY DISTRIBU QLTY US 281.4 (124.4) 40.9 QUANTUM CORP QTM US 431.0 (61.1) 97.9 QWEST COMMUNICAT Q US 16,849.0 (1,560.0) (2,828.0) RAPTOR PHARMACEU RPTP US 20.5 (14.6) (21.4) REGAL ENTERTAI-A RGC US 2,323.2 (541.6) (114.5) RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) REVLON INC-A REV US 1,105.5 (686.5) 132.7 RSC HOLDINGS INC RRR US 2,949.6 (59.2) (205.0) RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 SALLY BEAUTY HOL SBH US 1,707.0 (340.6) 418.5 SINCLAIR BROAD-A SBGI US 1,571.2 (144.6) 60.4 SINCLAIR BROAD-A SBTA GR 1,571.2 (144.6) 60.4 SKULLCANDY INC SKUL US 80.4 (17.7) 38.7 SMART TECHNOL-A SMT US 546.2 (43.3) 173.7 SMART TECHNOL-A SMA CN 546.2 (43.3) 173.7 SPIRIT AIRLINES SAVE US 545.2 (97.0) 27.6 SUN COMMUNITIES SUI US 1,160.1 (111.7) - SWIFT TRANSPORTA SWFT US 2,555.7 (9.8) 204.6 TAUBMAN CENTERS TCO US 2,495.4 (426.8) - TEAM HEALTH HOLD TMH US 832.2 (25.7) 44.8 THERAVANCE THRX US 315.1 (27.8) 266.9 TOWN SPORTS INTE CLUB US 460.0 (4.7) (15.4) UNISYS CORP UIS US 2,949.3 (692.1) 547.6 VANGUARD HEALTH VHS US 4,162.2 (186.6) 356.5 VECTOR GROUP LTD VGR US 924.6 (61.4) 294.8 VENOCO INC VQ US 815.6 (21.6) 8.1 VERISK ANALYTI-A VRSK US 1,286.4 (109.1) (180.8) VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) VONAGE HOLDINGS VG US 251.7 (102.0) (39.2) WARNER MUSIC GRO WMG US 3,617.0 (254.0) (650.0) WEIGHT WATCHERS WTW US 1,126.0 (636.6) (345.4) WESTMORELAND COA WLB US 788.0 (173.9) (1.0) WORLD COLOR PRES WC CN 2,641.5 (1,735.9) 479.2 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 ********* 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, 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 ***