/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/111228.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, December 28, 2011, Vol. 15, No. 360 Headlines 3 G PROPERTIES: Court Confirms Amended Plan of Liquidation AMBAC FINANCIAL: Wants Claims Acquisition Notice Order AMBAC FINANCIAL: Resolves Depfa Bank's $2-Billion Claim AMERICAN APPAREL: Disowns 2011 EBITDA Estimates Report AQUILEX HOLDINGS: Reaches Deal With Lenders on Restructuring BARTON COUNTY MUTUAL: Judge OKs Takeover of Insolvent Insurers BATAA/KIERLAND LLC: JPMCC Paid in 20 Yrs. If 1111(b) Election Made BORDERS GROUP: Court Confirms Committee-Backed Liquidating Plan BORDERS GROUP: Wins Approval of Next Jump Settlement Agreement BP CLOTHING: Has Interim OK on Factoring Deal With First Capital BXP 1 LLC: Wants Stipulation Terminating Receivership Approved CDC PROPERTIES: Case Dismissed for Lack of Chance to Rehabilitate CHURCH FOR ART: N.Y. Court Flips Ruling in Interpleader Action CLARE AT WATER TOWER: Hires DLA Piper as Bankruptcy Counsel CLARE AT WATER TOWER: Taps Houlihan Lokey as Financial Advisor CIMA LLC: Hearing on Exclusivity Extension Request Set for Jan. 17 CROWN MEDIA: SC Affirms Recapitalization Lawsuit Dismissal COLONY RESORTS: Cancels Joint Services Pact with Resorts Int'l CYBEX INTERNATIONAL: Fails to Comply with NASDAQ Bid Price Rule DELTA PETROLEUM: Seeks to Honor Royalty & ORRI Obligations DUNE ENERGY: Inks Indemnification Agreements with Directors DYNEGY INC: Sec. 341 Meeting of Creditors Set for Jan. 20 DYNEGY INC: Court Orders Examiner in Debtor's Cases DYNEGY INC: Court Approves Rejection of Facility Leases EAGLE INDUSTRIES: Creditors Committee Opposes Plan Confirmation EASTMAN KODAK: KKR Representatives Step Down From Board HARRISBURG, PA: Files Second Attempt to Restore Bankruptcy HARTFORD COMPUTER: Seeks Recognition of Chapter 11 Case in Canada HARTFORD COMPUTER: Wins Approval to Hire KCC as Claims Agent HAWKER BEECHCRAFT: J. Maslowski to Retire as Gov. Business Pres. HOLLIFIELD RANCHES: Wants Automatic Stay in Effect Until Jan. 11 HAWAIIAN TELCOM: Litigation Trustee Loses Bid to Seal Doc JEREMIAH O'BRIEN: Objection to $2.4MM FTBK Claim Overruled KOREA TECHNOLOGY: Has Until Jan. 11 to Propose Chapter 11 Plan MACKINNON TRANSPORT: Has Intent for Restructuring Under BIA MADISON 92ND: Plan Centers on Hotel Sale, Pursue Causes of Action MAYWOOD CAPITAL: Trustee Moves to Foreclose NY Properties MOUNTAIN PROVINCE: Mulls Potential Spinout of Kennady Project MT. JORDAN: Utah Court Confirms Modified Bankruptcy Exit Plan MT VERNON: Can Access Fannie Mae/CNB Cash Collateral Until Feb. 28 MT VERNON: Has Access to Colombo Bank Cash Collateral Until Feb 28 MT VERNON: Can Access Carrolton Bank Cash Collateral Until Feb. 28 NEBRASKA BOOK: DIP Lenders Agree to Waive November EBITDA Covenant NEVADA CANCER: Disclosure Statement Hearing Continued to Jan. 26 NEVADA CANCER: Seeks to Hire Klee Tuchin as Bankruptcy Counsel NEVADA CANCER: Taps Lewis and Roca as Nevada Counsel NEVADA CANCER: Files Schedules of Assets and Liabilities NEVADA CANCER: Court Sets Jan. 30 General Claims Bar Date NEVADA CANCER: Sec. 341 Creditors' Meeting Set for Jan. 12 OLD CORKSCREW: Berger Singerman Notifies Change of Address OLDE PRAIRIE: Court Says Plan Must Permit Lender' to Credit Bid PELICAN ISLES: Feb. 16 Combined Hearing on Plan Set PENINSULA HOSPITAL: Proposes $8-Mil. DIP Loan from Revival Funding PIEDMONT CENTER: KeySource Wants Lift Stay, Block of Cash Access QUALTEQ INC: Venue Transfer Hearing Excludes Ad Hoc Panel's Gripe REGAL ENTERTAINMENT: M. Campbell Resigns as Executive Chairman REDDY ICE: Common Stock to Suspend Trading on NYSE RENASCENT INC: Plan Confirmation Hearing Continued Until Jan. 12 ROOMSTORE INC: Hires Lowenstein Sandler as Bankruptcy Counsel ROOMSTORE INC: Hires Feinblum as Real Estate Consultant ROOMSTORE INC: Assumes Amended Contract With Hilco SEARS HOLDINGS: To Close 120 Stores in Turnaround Plan SHINER CHEMICALS: Asks Court to Dismiss Involuntary Ch. 11 Case SHINER WAREHOUSE: Asks Court to Dismiss Involuntary Ch. 11 Case STANADYNE HOLDINGS: Inks Third Amendment to Wells Fargo Facility STOCKDALE TOWER: Seeks to Employ CB Richard as Real Estate Broker SUMMO INC: Asks Court to Approve "Lift Stay" with Frontier Bank WASHINGTON MUTUAL: Dime Litigation Reps Now Included in Mediation WAVERLY GARDENS: Bankruptcy Court Clerk Order to Close Ch. 11 Case WEST END: 2nd Amended Plan Provides for Liquidation of Assets WILLIAM LYON: Wins Court Okay to Tap $15MM From Colony DIP Loan WILLIAM LYON: Court Extends Schedules Filing Deadline WILLIAM LYON: Has Green Light to Hire KCC as Claims Agent WILLIAM LYON: Hiring Pachulski Stang as Chapter 11 Counsel WILLIAM LYON: Hiring Sitrick as Communications Consultant WINDRUSH SCHOOL: Wells Fargo Withdraws Motion for Case Conversion WINDRUSH SCHOOL: Bank Wants Case Converted to Ch. 7 or Dismissed * Upcoming Meetings, Conferences and Seminars ********* 3 G PROPERTIES: Court Confirms Amended Plan of Liquidation ---------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of North Carolina, on Dec. 5, 2011, confirmed the 3 G Properties, LLC's Amended and Restated Plan of Liquidation dated Nov. 3, 2011, as modified on Dec. 1, 2011. The Second Amended Disclosure Statement filed by Debtor on Nov. 3, 2011, was conditional approved by the Court in an order dated Nov. 4, 2011. Administrative claims, priority claims and tax claims are unimpaired under the Plan. Secured claims, including the $8,663,411 owed to Capital Bank, $3,333,519 owed to Southern Community Bank and Trust, and $1,400,000 owed to the County of Granville, North Carolina, are impaired. Capital Bank, Southern Community Bank, and Granville county specifically accepted the Modified Plan. Unsecured claims are also impaired. Holders of thee claims will be paid, on a pro rata basis, from the "remaining cash balance." Holders of member interests in the Debtor will retain their equity interests; however, such retained interests will be subordinate to all payments to creditors provided for in the Plan. A copy of the Second Amended Disclosure Statement is available for free at http://bankrupt.com/misc/3gproperties.doc209.pdf About 3 G Properties Wake Forest, North Carolina-based 3 G Properties, LLC, filed for Chapter 11 bankruptcy (Bankr. E.D.N.C. Case No. 10-04763) on June 14, 2010. 3 G Properties is a North Carolina limited liability company formed as a result of the statutory merger of three existing North Carolina limited liability companies: Lake Glad Road Partners, LLC, Lake Glad Road Commercial, LLC, and Granville Park Partners, LLC. The Debtor owns four separate real estate tracts: (i) approximately 510 acres of commercial property located in Granville County and Vance County, North Carolina known as Triangle North Park, (ii) 58 acres of commercial property located in Granville County, North Carolina, which is part of the Highland Trails development project, (iii) 192 acres of residential property located in Granville County, North Carolina, also part of the Highland Trails development project, and (iv) a 17.2 acre tract adjacent to the Triangle North Parke property which is known as the "Ball Property". Gregory B. Crampton, Esq., and Kevin L. Sink, Esq., at Nicholls & Crampton, P.A., in Raleigh, N.C., represent the Debtor in its restructuring effort. The Company estimated its assets and debts at $10 million to $50 million as of the Petition Date. AMBAC FINANCIAL: Wants Claims Acquisition Notice Order ------------------------------------------------------ Ambac Financial Group, Inc. asks Judge Shelley Chapman to enter a "Claims Acquisition Notice Order." In November 2010, the Court entered the Trading Order establishing procedures for certain transfers of equity interests and claims against the Debtor. In July 2011, the Debtor filed with the Court a reporting notice as required in the Trading Order. Pursuant to the Trading Order, once the Debtor filed the Reporting Notice with the Court, Beneficial Owners of more than $55 million of claims against the Debtor were required to serve a notice upon the Debtor and its counsel by August 18, 2011. Pursuant to the Second Amended Plan of Reorganization, on the Plan's effective date, holders of Class 3 General Unsecured Claims, Class 4 Senior Notes Claims, and Class 5 Subordinated Notes Claims would receive or would be eligible to receive new common stock in the reorganized Debtor. Moreover, the Plan is a Section 382(l)(5) of the Internal Revenue Code Plan. After reviewing the Substantial Claimholder Notices received, the Debtor has determined that entry of a Sell Down Order is not at this time required in order to preserve its tax attributes and implement the Plan, provided the Court enters the Claims Acquisition Notice Order, Allison H. Weis, Esq., at Dewey & LeBoeuf LLP, in New York, relates. Pursuant to the Claims Acquisition Notice Order: (I) (a) Any Entity proposing to acquire Claims in a transaction following which that Entity would have Beneficial Ownership of Claims that, pursuant to the Plan, would entitle the Entity to receive New Common Stock in exceeding the amount of New Common Stock to which the Entity would have been entitled based upon the holdings reported on that Entity's Substantial Claimholder Notice; and (b) any Entity that would become a Potential Substantial New Stockholder by virtue of a proposed acquisition of Beneficial Ownership of Claims, will be required, at least 15 business days prior to the consummation of the transaction, to serve upon the Debtor and its counsel, by overnight mail, advance written notice of the intended Claims acquisition, in the form attached to the Trading Order as Schedule 6. (II) The Debtor will have ten business days after the receipt of a Proposed Claims Acquisition Notice to file with the Court and serve upon the Entity providing the notice an objection to any proposed acquisition described in the notice on the grounds that the acquisition might adversely affect the Debtor's ability to utilize its tax attributes. If the Debtor files an objection, the acquisition described in the Proposed Claims Acquisition Notice will not be effective unless approved by a final and nonappealable order of the Court. If the Debtor does not object within 10 business days, the acquisition described in the Proposed Claims Acquisition Notice may proceed solely as set forth in the notice. Any further Claims acquisitions by the Entity providing the Proposed Claims Acquisition Notice will be the subject of additional notices. (III) Any Entity that has acquired Beneficial Ownership of Claims as to which a Proposed Claims Acquisition Notice would have been required, but for the fact that the acquisition occurred prior to the entry of the Claims Acquisition Notice Order, will serve a Proposed Claims Acquisition Notice upon the Debtor and its counsel, by overnight mail, within 15 days of the entry of the Claims Acquisition Notice Order. If the Debtor determines that the retention by the Entity of those Claims could jeopardize the implementation of the Plan, the Debtor may serve a Sell Down Notice on the Entity, in which case the procedures described in the Trading Order with respect to Sell Down Notices will apply. (IV) The Equity Forfeiture Provisions set forth in the Trading Order will apply to any Entity that fails to comply with the Claims Acquisition Notice Order or any terms of the Trading Order. The Trading Order specifically contemplates entry of a Claims Acquisition Notice Order under these circumstances to preserve the Debtor's tax attributes and ability to implement the Plan. Under the Trading Order, the Debtor is required, subject to certain inapplicable exceptions, to keep information provided in Proposed Claims Acquisition Notices received by it and its counsel confidential, Ms. Weis notes. Accordingly, the Debtor seeks Court permission to file under seal any affidavit of service relating to any Sell Down Notice served upon a Claimholder in accordance with the Claims Acquisition Notice Order pursuant to Section 107(b) of the Bankruptcy Code and Rule 9018 of the Federal Rules of Bankruptcy Procedure. Promptly following entry of the Claims Acquisition Notice Order: * The Debtor will serve a notice on the U.S. Trustee for Region 2, counsel for the Official Committee of Unsecured Creditors, counsel for the Office of the Commissioner of Insurance of the State of Wisconsin, and any Entity that has filed a written request for notice with the Court pursuant to Bankruptcy Rule 2002; * The Debtor will cause the Notice to be served on each registered holder of more than $10 million of Senior or Subordinated Notes, and any registered holder of more than $10 million of Senior or Subordinated Notes will, in turn, be required to promptly provide the Notice to any holder for whose account the registered holder holds more than $10 million of Senior or Subordinated Notes, and so on down the chain of ownership; and * The Debtor will cause the Notice to be published on the Bloomberg newswire service and the Depository Trust Company Legal Notice System. The Debtor asks the Court to find that service and publication of the Notice be considered good, adequate, and sufficient notice of entry of the Claims Acquisition Notice Order. The Court will consider the Debtor's request on January 6, 2012. Objections are due no later than December 30, 2011. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor- in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed US$30.05 billion in total assets, US$31.47 billion in total liabilities, and a US$1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of (US$394.5 million) and total liabilities of US$1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about US$1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's bankruptcy counsel. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. The confirmation hearing for approval of Ambac's Chapter 11 plan, originally set for Dec. 8, is now on the calendar for Jan. 19. Disagreements with the Wisconsin insurance commissioner over the sharing of tax benefits had held up a plan for the holding company. Bankruptcy Creditors' Service, Inc., publishes Ambac Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Ambac Financial Group and the restructuring proceedings of Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945- 7000). AMBAC FINANCIAL: Resolves Depfa Bank's $2-Billion Claim ------------------------------------------------------- Ambac Financial Group, Inc. entered into a Court-approved stipulation with Depfa Bank plc to deem Claim No. 2966 withdrawn with prejudice. Depfa Bank is the alleged holder of bonds and debt securities with initial notional amounts aggregating more than $2 billion and which are the subject of financial guaranty insurance policies by the Debtor's subsidiary, Ambac Assurance Corporation. Depfa Bank alleged that the Debtor should be responsible for AAC's debt since it dominated and controlled AAC. Claim No. 2966 was filed by Depfa Bank in March 2011, to which the Debtor filed an objection to. The claim withdrawal is not deemed to release, discharge, withdraw or otherwise affect any claim that Depfa may have against AAC or the Segregated Account of AAC. The parties will bear their own costs, expenses and attorneys' fees incurred in connection with the Claim, the Objection and the Stipulation. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will continue to operate in the ordinary course of business as "debtor- in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac's bond insurance unit, Ambac Assurance Corp., did not file for bankruptcy. AAC is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Ambac's consolidated balance sheet -- which includes non-debtor Ambac Assurance Corp -- showed US$30.05 billion in total assets, US$31.47 billion in total liabilities, and a US$1.42 billion stockholders' deficit, at June 30, 2010. On an unconsolidated basis, Ambac said in a court filing that it has assets of (US$394.5 million) and total liabilities of US$1.6826 billion as of June 30, 2010. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about US$1.62 billion. Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L. Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's bankruptcy counsel. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. The confirmation hearing for approval of Ambac's Chapter 11 plan, originally set for Dec. 8, is now on the calendar for Jan. 19. Disagreements with the Wisconsin insurance commissioner over the sharing of tax benefits had held up a plan for the holding company. Bankruptcy Creditors' Service, Inc., publishes Ambac Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Ambac Financial Group and the restructuring proceedings of Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945- 7000). AMERICAN APPAREL: Disowns 2011 EBITDA Estimates Report ------------------------------------------------------ Last week, an article appeared in a trade publication that referred to estimates of American Apparel, Inc.'s fiscal 2011 EBITDA that were attributed to the Company's Chief Executive Officer. Consistent with the Company's policy to not make projections of EBITDA or other financial performance measures, the Company hereby disclaims those estimates and cautions that no reliance should be placed on them. About American Apparel Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP) -- http://www.americanapparel.com/-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel. As of September 2010, American Apparel employed over 10,000 people and operated 278 retail stores in 20 countries, including the United States, Canada, Mexico, Brazil, United Kingdom, Ireland, Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea and China. The Wall Street Journal reports that Skadden, Arps, Slate, Meagher & Flom has been advising the company on its recent restructuring efforts alongside investment bank Rothschild Inc. In April 2011, American Apparel said it raised $14.9 million in rescue financing from a group of investors led by Canadian financier Michael Serruya and private equity firm Delavaco Capital Corp., allowing the casual clothing retailer to meet obligations to its lenders for the time being. Going Concern Doubt Marcum LLP, in New York, in its audit report on American Apparel's financial statements for the year ended Dec. 31, 2010, expressed substantial doubt about the Company's ability to continue as a going concern. As of April 30, 2011, the Company had approximately $8,000,000 of cash, approximately $8,900,000 of availability for additional borrowings and $46,100,000 outstanding on the credit facility under the BofA Credit Agreement and $1,400,000 of availability for additional borrowings and $4,000,000 outstanding on the credit facility under the Bank of Montreal Credit Agreement. As May 10, 2011, the Company had approximately $5,941,000 available for borrowing under the BofA Credit Agreement and $1,481,000 available under the Bank of Montreal Credit Agreement. American Apparel reported a net loss of $86.31 million on $532.99 million of net sales for the year ended Dec. 31, 2010, compared with net income of $1.11 million on $558.77 million of net sales during the prior year. The Company also reported a net loss of $28.15 million on $389.76 million of net sales for the nine months ended Sept. 30, 2011, compared with a net loss of $67.01 million on $389.02 million of net sales for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $323.64 million in total assets, $267.51 million in total liabilities and $56.12 million in total stockholders' equity. Bankruptcy Warning The Company incurred a loss from operations of $20,942 for the nine months ended Sept. 30, 2011, compared to a loss from operations of $38,167 for the nine months ended Sept. 30, 2010. The current operating plan indicates that losses from operations will be incurred for all of fiscal 2011. Consequently, the Company may not have sufficient liquidity necessary to sustain operations for the next twelve months and this raises substantial doubt that the Company will be able to continue as a going concern. There can be no assurance that management's plan to improve its operating performance and financial position will be successful or that the Company will be able to obtain additional financing on commercially reasonable terms or at all. As a result, the Company's liquidity and ability to timely pay its obligations when due could be adversely affected. Any new financing also may be substantially dilutive to existing stockholders and may require reductions in exercise prices or other adjustments of the Company's existing warrants. Furthermore, the Company's vendors and landlords may resist renegotiation or lengthening of payment and other terms through legal action or otherwise. If the Company is not able to timely, successfully or efficiently implement the strategies that it is pursuing to improve its operating performance and financial position, obtain alternative sources of capital or otherwise meet its liquidity needs, the Company may need to voluntarily seek protection under Chapter 11 of the U.S. Bankruptcy Code. AQUILEX HOLDINGS: Reaches Deal With Lenders on Restructuring ------------------------------------------------------------ Aquilex Holdings LLC announced Friday that it has reached agreement with institutions holding 100% of its first lien debt, 100% of the Company's second lien debt and holders of approximately 92% of the Company's outstanding 11-1/8% Senior Notes due 2016 on the terms of a consensual financial restructuring transaction that would significantly reduce the Company's debt and recapitalize the Company with a substantial amount of new equity. The Company expects that the transaction will likely be completed in late January to mid-February 2012 pursuant to a voluntary exchange offer the Company has launched today. Under the restructuring, all trade creditors would receive payment in full in the ordinary course. "We are making strong progress in our financial restructuring efforts and are thrilled to have now received such overwhelming support prior to initiating solicitation of the transaction from institutions holding 100% of our first lien debt, 100% of our second lien debt and holders of approximately 92% of our Senior Notes for our debt reduction plan," said Bill Varner, President and Chief Executive Officer of Aquilex. "The implementation of this plan, most likely through a voluntary exchange offer now underway, will significantly enhance Aquilex's capital structure and our prospects for renewed growth and success. We look forward to significantly deleveraging our balance sheet, strengthening our financial flexibility and investing in the business to better serve our customers. Upon completion, this transaction will reduce our debt by 71%, or approximately $322 million, and our debt service costs will decline by 70% to approximately $12 million annually. When coupled with expected cash at closing of $16.5 million and an Exit Revolver facility of $40 million, the Company will be on a solid financial foundation." Aquilex has entered into a restructuring support agreement that provides for treatment of the Company's first lien debt, second lien debt, Senior Notes and all of the equity interests of the Company through either a voluntary exchange offer or a prepackaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. The Company launched the Exchange Offer Friday. In conjunction with the closing of the restructuring, the Company expects that affiliates of Centerbridge Partners, L.P., would become the controlling shareholder of Aquilex. Under the terms of the Support Agreement: -- First lien lenders will (i) amend the Credit Agreement to provide for a restructured term loan in the amount of approximately $132.8 million that will mature in April 2016, with financial covenants reset to the Company's current business plan, and (ii) receive a $65 million paydown; -- Second lien lenders will convert their debt into new participating preferred equity of the reorganized Aquilex representing 10.5% of the fully diluted equity; and -- Holders of the Senior Notes who are accredited investors will be asked to exchange their existing Senior Notes in return for their pro rata share of approximately 29.8% to 33.3% of the fully diluted equity of the reorganized Aquilex and the ability to purchase, pursuant to a rights offering in an aggregate amount of $80 million (the "Rights Offering"), their pro rata share of the new participating preferred equity of the reorganized Aquilex representing approximately 53.4% of the fully diluted equity. Non-accredited investors who owned their Senior Notes on Dec. 23, 2011, will be offered a cash payment for their Senior Notes equal to 37.5% of the principal amount of the Senior Notes tendered to the offer, while non-accredited investors who acquired their Senior Notes after Dec. 23, 2011, will be offered the same percentage offered to accredited investors. Holders of the Senior Notes who are accredited investors will have the option to receive cash in lieu of common equity and the Rights Offering in an amount equal to 24.8% to 27.7% of the principal amount of the Senior Notes. In addition, noteholders who are not backstopping the Rights Offering and who participate in the Exchange Offer will receive a consent fee equal to 3% of the principal amount tendered. -- Holders of the current equity interests of the Company will have their interests canceled. To provide certainty to the Rights Offering being fully subscribed, the Company has entered into a Backstop Purchase Agreement with certain holders of the Company's Senior Notes, pursuant to which these holders have agreed to fully backstop the Rights Offering. In return for this commitment, these parties will receive a fee of $3.6 million, which will be payable in new second-lien debt and which, upon closing, will be equitized into new participating preferred equity of the reorganized Aquilex, representing 2.4% of the fully diluted equity. In addition, depending on the number of noteholders electing the cash-out option, the backstop parties will receive new participating preferred equity of the reorganized Aquilex representing up to 3.5% of the fully diluted equity in return for funding such cash requirement. The closing of the Exchange Offer is conditioned upon, among other things, a fully committed Exit Revolver with a $40 million commitment, acceptances from holders of at least 90% of the first lien debt to the amendment to the Credit Agreement, agreement from 100% of the second lien lenders to the conversion of their debt and 99% of the aggregate principal amount of Senior Notes having been validly tendered into the Exchange Offer and not withdrawn. To date, the Company has received the necessary acceptances from the first lien lenders and second lien lenders. Mr. Varner stated, "The overwhelming support we have received from our creditor groups, prior to today's launch of the transaction, provides us with confidence that the transaction is very likely to be consummated out-of-court." If the Exchange Offer conditions are not met, the Company will commence a voluntary filing under Chapter 11 of the U.S. Bankruptcy Code in order to implement the restructuring plan. Under this scenario, the Company currently expects an expeditious court process of less than 60 days and that the proceedings would not affect its customers, vendors or employees. The Company has entered into a $10 million Debtor-in-Possession financing commitment letter with Royal Bank of Canada as agent in order to finance such process, and the backstop parties providing the Rights Offering backstop have agreed to increase their investment in the participating preferred equity by an additional $5 million in the event of a Chapter 11 filing. In such a circumstance, the fully diluted equity ownership percentage will be modified to: -- 10.7% for the second lien lenders; -- 53.4% for the participants in the Rights Offering; -- 26.8% to 30.1% for the holders of the Senior Notes; -- 3.3% for the backstop parties in exchange for their additional $5 million investment; --Depending on the number of noteholders electing the cash-out option, up to 3.3% for the backstop parties in return for funding such cash requirement; and -- 2.4% for the backstop parties for the backstop fee. There will be no consent fee paid in the event of a Chapter 11 filing, and in such a case the cash-out option provided to the holders of the Senior Notes will be 22.3% to 25.1% for accredited investors and 37.5% for non-accredited investors. Rothschild Inc. is acting as financial advisor and investment banker and Richards, Layton & Finger is acting as legal advisor to Aquilex in connection with the restructuring. Alvarez & Marsal is acting as restructuring advisor to the Company. A complete text of the Restructuring Support Agreement is available for free at http://is.gd/7YI6Tw A complete text of the Backstop Purchase Agreement is available for free at http://is.gd/5nckW1 About Aquilex Holdings Atlanta, Ga.-based Aquilex Holdings LLC is the parent of Aquilex Corporation, a provider of critical maintenance, repair and industrial cleaning solutions to the energy industry. Through its divisional and branch offices in the United States, Europe and the Middle East, the Company provides its services to a diverse global base of over 600 customers, primarily in the oil and gas refining, chemical and petrochemical production, fossil and nuclear power generation and waste-to-energy industries. Aquilex reported a net loss of $298.6 million on $327.7 million of revenues for the nine months ended Sept. 30, 2011, compared with a net loss of $27.5 million on $324.0 million of revenues for the same period a year ago. Aquilex's balance sheet at Sept. 30, 2011, showed $400.5 million in total assets, $505.5 million in total liabilities, and a stockholders' deficit of $105.0 million. * * * On Dec. 16, 2011, Standard & Poor's Ratings Services lowered its corporate credit rating on Atlanta, Ga.-based Aquilex Holdings LLC to 'D' from 'CC'. "We also lowered the issue-level rating on the Company's senior unsecured notes to 'D' from 'C' and lowered the issue-level rating on its first-lien senior secured debt to 'CC' from 'CCC'. Our '1' recovery rating on the first-lien facilities remains unchanged and indicates our expectations of very high (90% to 100%) recovery for lenders. We have removed all ratings from CreditWatch where we placed them with negative implications on Nov. 21, 2011," S&P said. "The downgrade reflects Aquilex's failure to pay the scheduled interest on its $225 million senior unsecured notes which mature on Dec. 15, 2016," said Standard & Poor's credit analyst James T. Siahaan. The semiannual interest payment was due Dec. 15, 2011. BARTON COUNTY MUTUAL: Judge OKs Takeover of Insolvent Insurers -------------------------------------------------------------- A Barton County, Kansas judge has approved a proposal to allow Missouri Farm Bureau to assume operations of three insolvent insurance companies. Operated by the Barton County Mutual Group, the three small companies became insolvent after paying claims from the May 22 Joplin tornado. The judge has approved a proposal by the Missouri Department of Insurance, which: * allows the three companies to merge into one company managed by Farm Bureau; * allows Farm Bureau to invest approximately $14 million in surplus notes to restore the company's surplus to a positive level, with the notes being backed by the Missouri Property and Casualty Insurance Guaranty Association; * allows the new company the financial capacity to ensure all policyholder claims are paid and policyholder coverage to continue; and * requires the new company to buy an amount of reinsurance deemed adequate by the department to meet future claims obligations. The three companies had premium sales of $29 million in 2010, but reported claims of $48 million related to the Joplin tornado. The judge ordered the three companies into receivership on Dec. 1, placing them under the management of the Department of Insurance. Once the plan is implemented according to the judge's order, the department's control will be lifted. "This is a win for all involved," said John M. Huff, director of the Missouri Department of Insurance. "Policyholders' claims will be paid and Missouri taxpayers will not have to foot the bill. I commend Farm Bureau and Guaranty Association for partnering with us in this innovative agreement." "We are pleased the Department of Insurance and now a Missouri Circuit Judge recognize the financial strength and management expertise of Missouri Farm Bureau to stabilize these three insurance companies and protect their policy holders," said Blake Hurst, president of Missouri Farm Bureau. "The Joplin tornado was a devastating event that resulted in property losses that were too much for these companies to handle. We will work to ensure that policyholder claims are paid and all policyholders' coverage is continued." Missouri Farm Bureau operates the state's seventh largest home- owners insurance company, with premium sales of $39 million in 2010, and the state's ninth largest auto insurer, with premium sales of $60 million. The three insolvent companies are Barton Mutual Insurance Co., Gateway Mutual Insurance Co. and Cape Mutual Insurance Co., which have about 41,000 policyholders with homeowners and fire policies. They are licensed as extended Missouri mutuals, also known as county mutuals or farm mutuals. In general, county mutuals are small companies serving rural policyholders. There are about 90 of them in Missouri. Mr. Huff said policyholders must continue making premium payments to keep their insurance coverage intact. Payments should continue to be sent to the Barton County Mutual Group's office in Liberal. Consumers or insurance agents with questions about any of the three companies in receivership should contact the Insurance Consumer Hotline at 800-726-7390 or visit insurance.mo.gov. BATAA/KIERLAND LLC: JPMCC Paid in 20 Yrs. If 1111(b) Election Made ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Arizona has approved the Amended Disclosure Statement relating to the Amended Plan of Reorganization of Bataa/Kierland, LLC, dated Sept. 2, 2011. The Plan will be funded by the Debtor's funds on hand, operations of the Property, and a capital infusion in the amount of the New Value by the Interest Holder or the Successful Bidder, if an auction is held. Bataa Oil intends to fund the New Value contribution through existing cash that Bataa Oil currently has on hand, and any additional cash received by Bataa Oil prior to the Confirmation Date. To the extent that Bataa Oil does not have sufficient funds to make the New Value contribution by the Confirmation Date, Bataa Oil has arranged for the receipt of a loan, up to $200,000, from Banker?s Trust that can be drawn upon by Bataa Oil to make the New Value contribution. The Plan segregates the various Claims against and Interests in the Debtor into seven classes: Priority Claims (Class 1), Secured Claims (Class 2), Tenant Security Deposits (Class 3), Unsecured Claims (Class 4), Kierland II (Class 4), Banker's Trust (Class 6) and Interest Holders (Class 7). With the exception of the Classes 1-A through 1-C (the "Priority Claims"), all the creditors of the Debtor are impaired under the terms of the Plan. Class 7 consists of all Allowed Interests of Bataa Oil, the Interest Holder in the Debtor. The Interest Holder will purchase the equity interests in the Reorganized Debtor by the contribution of cash to the Reorganized Debtor in the total amount of $240,000, payable on the Effective Date of the Plan (i.e., the New Value). The New Value will be used to: (a) pay the amount necessary to pay all Class 1 Allowed Priority Claims; (b) pay the amounts to Maricopa County (Class 2-B), to the extent that the cash on hand or cash flow from the Property is insufficient to pay the taxes; (c) pay the Unsecured Distribution Amount of $42,000; (d) fund the Reserve Account to pay, as necessary, among other things, (1) interest-only payments to JPMCC and, debt service payments, to the extent that cash flow is insufficient to make debt service payments, (2) tenant improvements, (3) broker's commissions, and (4) other necessary and appropriate capital expenses of the Property to ensure that the value of the Property is maintained. If the Court determines that, under the circumstances, the New Value to be contributed by the Interest Holder is insufficient, or that other parties-in-interest should be allowed to bid for the equity interests in the Reorganized Debtor, then other interested parties may bid for the equity interests in the Reorganized Debtor. JPMCC's Secured Claim JPMCC 2007-CIBC 19 East Greenway, LLC (Class 2-A) has asserted a claim against the Debtor, allegedly secured by the Debtor's primary asset consisting of a Class "A" office building and associated surface parking area, known as Kierland Corporate Center, in the amount of $28,023,082.82, according to a proof of claim filed by JPMCC. If the default interest and "pre-payment premium", which the Debtor disputes, are excluded from the calculation of the amount of JPMCC's claim, then the amount of JPMCC's claim is approximately $23,461,480. The treatment of JPMCC's Claims will depend on whether it makes the Section 1111(b) Election or not: (i) If JPMCC does not make the Section 1111(b) Election, pursuant to Section 506(a)(1) of the Bankruptcy Code, the amount of JPMCC's Allowed Secured Claim will be limited to the value of its collateral, which the Debtor believes to be no more than $6.5 million. The remainder of JPMCC's Allowed Claim will be treated as a general unsecured claim in Class 4. The Debtor intends to pay JPMCC's Allowed Secured Claim in full, with interest at the Plan Rate, over a period of seven years. During the initial 24 months of the term of the New Note, the Debtor will make monthly interest only payments to JPMCC at the Plan Rate. Thereafter, the Debtor will monthly payments of principal and interest until the Maturity Date based upon a 25 year amortization with interest at the Plan Rate. Any remaining principal balance and any interest due under the New Note will be paid to JPMCC on the Maturity Date. (ii) If JPMCC makes the Section 1111(b) election, then JPMCC's entire Allowed Claim will be treated as fully secured, and JPMCC will not have any claims in Class 4. In this event, the Debtor will treat JPMCC?s Allowed Claim as follows: -- Subject to the terms of this Plan and any Order confirming this Plan, JPMCC will retain its lien on the Property and its other pre-petition collateral in the full amount of its Allowed Claim, as such Allowed Claim is determined by the Court. -- For purposes of this analysis, the Debtor assumes that (i) JPMCC's Allowed Claim will be established at no more than $23,500,000, rather than the over $28,000,000 asserted by JPMCC in its pleadings filed in this case; and (ii) the value of JPMCC's collateral is $6.5 million. --The actual amount of JPMCC's Allowed Claim, and the value of its collateral base, will be established by the Court. -- The Reorganized Debtor will pay the total amount of JPMCC's Allowed Claim on or before the end of the 20th year following the Effective Date of the Plan as follows: (i) On the Effective Date, the Debtor will make a payment of $42,000 to JPMCC; (ii) Each month thereafter for a total period of 35 months following the Effective Date, the Debtor will make monthly payments of $42,000 each to JPMCC, for a total annual payment to JPMCC of $504,000 per year for the first three years following the Effective Date; (iii) Beginning on the 4th anniversary of the Effective Date, the Debtor will make monthly payments of $50,000 each to JPMCC for the next 204 months, for a total annual payment to JPMCC of $600,000 per year for the next 17 years following the Effective Date; and (iv) On or before the 21st anniversary following the Effective Date of the Plan (the "Pay-Off Date"), the Debtor will pay the remaining balance of JPMCC's Allowed Claim, assumed to be $11,788,000 (based upon an initial loan amount of $23,500,000), from either the sale of the Property or a refinancing of the Property. ?- In the event the Court finds that JPMCC's Allowed Claim is different than $23,500,000 and/or that the value of JPMCC's collateral is different than $6.5 million, then (i) the stream of payments on JPMCC's claim will remain the same but (ii) any balance of JPMCC's Allowed Claim remaining on the Pay-Off Date will be adjusted accordingly. -- The Reorganized Debtor reserves its right and ability to sell or refinance the Property at any time prior to the Pay-Off Date, so long as the net sale or loan proceeds (after payment of costs of sale or loan) are sufficient to pay the remaining amount of JPMCC's Allowed Claim in full. General Unsecured Claims The Debtor estimates that the total amount of general unsecured claims (Class 4) is approximately $41,881, not including the tenant security deposits or any potential unsecured deficiency claim of JPMCC arising by application of Section 506(a) of the Bankruptcy Code). The Debtor estimates that the amount of JPMCC's unsecured deficiency claim would be approximately $21,523,082, if the entire amount of JPMCC's asserted claim is allowed. If the default interest and "pre-payment premium" asserted by JPMCC are excluded from the calculation of the amount of JPMCC's claim, then the amount of JPMCC's unsecured deficiency claim is approximately $16,961,480. Therefore, not including the unsecured tenant security deposits, and assuming that JPMCC does not make the Section 1111(b) election, the total amount of unsecured claims against the Debtor's estate is approximately between $21,564,963 and $17,003,361. If JPMCC does not make the Section 1111(b) election, then Allowed Unsecured Claims will be treated as follows: (i) First, Allowed Unsecured Claims will share, pro-rata, in a distribution of the sum of $42,000 in cash (the "Unsecured Distribution Amount") paid by the Reorganized Debtor, from the New Value contribution, on the 90th day following the Effective Date of the Plan. (ii) Second, Allowed Unsecured Claims will share, pro rata, in seven (7) annual distributions of 25% of the net revenues from the operations of the Property after payment of (a) all operating expenses of the Property, (b) debt service payments to JPMCC, (c) tenant improvement costs, (d) leasing commissions, (e) actual costs associated with HVAC upgrades and maintenance and other capital expenditures, and (f) a $25,000 annual distribution to a capital reserve account ("Annual Percentage Distributions"). (iii) Third, the Reorganized Debtor will issue to each holder of an Allowed Unsecured Claim its pro rata portion of a $500,000 subordinated debenture payable to holders of Allowed Unsecured Claims (the "Subordinated Debenture"). It is anticipated that, if JPMCC does not make the Section 1111(b) election, unsecured creditors in this Class will receive a pro rata distribution of approximately 5.5% of their unsecured claims. If JPMCC makes the Section 1111(b) election, then JPMCC will not have any claims in this Class, and Allowed Unsecured Claims will be treated as follows: -- The Allowed Unsecured Claims in this Class will be paid their pro rata distribution of a cash distribution in the total amount of $42,000 (i.e., Unsecured Distribution Amount) on the 90th day following the Effective Date of the Plan. -- Upon their receipt of the funds from the Reorganized Debtor, all Allowed Unsecured Claims in this Class will be deemed paid and discharged in full. It is anticipated that, if JPMCC does make the Section 1111(b) election, unsecured creditors in this Class will receive a pro rata distribution of approximately 100% of their unsecured claims. A copy of the Amended Disclosure Statement is available for free at http://bankrupt.com/misc/bataa.doc103.pdf About Bataa/Kierland Bataa/Kierland, LLC, owns and operates a Class "A" office building known as Kierland Corporate Center located at 7047 E. Greenway Parkway, Scottsdale, Arizona. It filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 11-05850) on March 9, 2011. The Debtor estimated its assets and debts at $10 million to $50 million. Polsinelli Shughart PC serves as the Debtor's bankruptcy counsel. The United States Trustee said that a committee under 11 U.S.C. sec. 1102 has not been appointed because an insufficient number of persons holding unsecured claims against Bataa/Kierland have expressed interest in serving on a committee. BORDERS GROUP: Court Confirms Committee-Backed Liquidating Plan --------------------------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York confirmed the First Amended Joint Plan of Liquidation filed by Borders Group, Inc. and its debtor affiliates and the Official Committee of Unsecured Creditors at a Dec. 20, 2011 hearing, according to Tiffany Kary of Bloomberg News. "It's unfortunate that the Debtors were unable to reorganize as a going concern," Judge Glenn was quoted as saying at the Dec. 20 confirmation hearing on the Plan. Borders, once the second largest bookseller chain, had hoped to undergo a successful restructuring process when it filed for bankruptcy protection in February this year. However, the company failed to find a buyer for its entire business in July and thus, opted to wind down by selling its assets and stores piece by piece. "At the end of the day when it comes time for confirmation, the story is told by voting," Andrew K. Glenn, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, Borders' counsel, told the bankruptcy judge, Bloomberg relayed. The Plan garnered overwhelming support from creditors, a sign the company had done the right thing, Judge Glenn acknowledged, the report noted. Judge Glenn also approved the terms of creditors repayments set forth in the Plan after five remaining objections to its confirmation were resolved, Bloomberg News stated. Among the objectors were Liberty Mutual Insurance Company who raised concerns over certain insurance policies; the state of Michigan who raised concerns over a tax claim; and Rocks Tysons Two LLC who raised issue over substantive consolidation under the Plan. Wells Fargo Bank filed a joinder to Rocks Tysons' objection. The Plan contemplates the liquidation and distribution of the Debtors' remaining assets through a liquidation trust. The Liquidating Trust will be managed by Curtis R. Smith. The Debtors, having no further assets or operations, will dissolve. Under the Plan, unsecured creditors are expected to recover 4% to 10% on their claims worth $812 million to $850 million. This recovery excludes any possible proceeds from the pursuit of avoidance actions. Borders' lawyer said at the Dec. 20 hearing that the recovery for the unsecured creditors may exceed the expected range slightly, Bloomberg relayed. Secured claims are estimated at $2 million, while priority tax claims are estimated at $7.4 million to $13.9 million. The Plan provides for 100% recovery on both these claims. The bankruptcy judge has yet to enter a formal confirmation order on the Plan. Modifications to Plan/Proposed Confirmation Order Before the Dec. 20 Confirmation Hearing, the Plan Proponents submitted to the Court a proposed non-material modification to the Plan and a revised proposed confirmation order. Among other things, the proposed Plan modification reflects a compromise resolving concerns over the substantive consolidation provision under the Plan. Rocks Tysons' plan objection was on the resulting elimination of its purported guaranty provided by Borders Group, Inc. with respect to Borders, Inc.'s lease obligations. Several other landlords, purportedly holdings similar guaranties, expressed similar concerns. To resolve those concerns, the Plan Proponents intended to include certain language in the order confirming the Plan stating in relevant part that any party with an interest in real property that was leased to one of the Debtors that is: (a) a holder of an Allowed General Unsecured Claim against Borders Inc. and (b) who also holds an Allowed General Unsecured Claim against BGI that is either (i) scheduled by BGI and not listed as disputed, contingent or unliquidated, or (ii) the subject of a timely filed proof of claim based on a valid written guaranty issued by BGI will be deemed to hold an Allowed Class 3 General Unsecured Claim in an amount equal to 120% of the Allowed amount of the Holder's General Unsecured Claim against Borders, Inc., and all Lessor Guaranty Claims against BGI or any other Debtor entity will be deemed waived, released and expunged. The Landlords have told the Debtors that the inclusion of the language will resolve their objections to confirmation of the Plan. Moreover, the Plan Proponents believe that the Plan Modification does not adversely change the treatment afforded to holders of Class 3 Claims and that those holders would not reconsider their acceptances of the Plan because of the Plan Modification. Even after implementing the Plan Modification, holders of Class 3 Claims will still receive a recovery within the range set forth in the Disclosure Statement, counsel to the Debtors, David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP, in New York, stated. Furthermore, the revised proposed confirmation order reflects the Plan Modification and addresses certain Plan Confirmation Objections. The relevant changes set forth in the revised proposed confirmation order are: (1) The Plan Proponents are authorized, in the notice of the effective date of the Plan, to confirm their election of whether the "Retained Assets" will be retained by the Liquidating Debtor, or whether the Retained Assets will be transferred to the Liquidating Trust. These will be deemed Retained Assets: (i) these agreements and all rights, obligations and privileges thereunder (a) the Amended and Restated Unanimous Shareholder Agreement dated Feb. 22, 2011, (b) the Joinder to Share Purchase Agreement, and (c) the Share Purchase Agreement dated November 8, 2011; and (ii) all of the Debtors' rights, title and interest in Kobo Inc., including, but not limited to, common stock or ownership interests, any option, call, warrant or right to purchase, sell or subscribe for an ownership interest or other equity security in Kobo, Inc. and any redemption, conversion, exchange, voting, participation, dividend rights and liquidation preferences relating to the capital stock or other ownership interest. Upon written notice from 2303202 Ontario Inc. and Indigo Books and Music, Inc., the Retained Assets will be transferred to the Liquidating Trust. (2) Nothing in the Confirmation Order or the Plan will release or exculpate any of the Debtors' corporate officers, principals or directors from any liability to the State of Michigan. The Plan Proponents agree that if the Plan Proponents elect to pay the State of Michigan's Priority Tax Claim through installment Cash payments, the applicable interest rate will be 4.25% per annum. Upon the failure of the Debtors or the Liquidating Trustee to make any payments due under the Plan on account of an (a) Allowed Priority Tax Claim, (b) Allowed General Unsecured Claim or (c) Allowed Secured Claim, each solely if held by a taxing authority, and the failure to cure the default within 30 days of receipt of written notice from the holder thereof, the Holder (i) may seek appropriate relief from the Court and (ii) in the event that each of the bankruptcy cases has been closed, may exercise rights and remedies available under non-bankruptcy laws for the collection of its claims. The Plan Proponents thus asked the Court to enter the revised proposed confirmation order, a full-text copy of which is available for free at: http://bankrupt.com/misc/Borders_Dec19RevPropConfOrd.pdf Plan Confirmation Order Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York inked on December 20, 2011, a formal order confirming the First Amended Joint Plan of Liquidation filed by Borders Group, Inc. and its debtor affiliates and the Official Committee of Unsecured Creditors. The Court confirmed the Plan after holding that it satisfies the confirmation requirements under Section 1129 of the Bankruptcy Code: (1) The Plan complies with the applicable provisions of the Bankruptcy Code, thus, satisfying Section 1129(a). (2) The Plan Debtors have complied with Section 1129(a)(2), including, without limitation, the disclosure and solicitation requirements of Sections 1125 and 1126 of the Bankruptcy Code. The Debtors transmitted solicitation materials including ballots to the Holders of Claims in Class 3 entitled to vote on the Plan, and non-voting materials to the holders of Claims or Equity Interests in Classes 1, 2, 4 and 5 only after the Bankruptcy Court approved the Disclosure Statement as containing adequate information. Those materials were distributed in compliance with the requirements of the Disclosure Statement Order, the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure. (3) The Plan Debtors have proposed the Plan in good faith and not by any means forbidden by the law, thus satisfying Section 1129(a)(3). The Debtors' objectives in proposing the Plan were for the valid business purpose of resolving disputes and satisfying, to the extent possible, the obligations of the Debtors. (4) Any payment made or to be made by the Plan Debtors for services or for costs and expenses in connection with the Debtors' bankruptcy cases, or in connection with the Plan, other than those incurred in the ordinary course of business, has been approved by the Court or is subject to the approval by the Court as reasonable, thus, satisfying Section 1129(a)(4). (5) The Plan Debtors have complied with Section 1129(a)(5) in that the Debtors have disclosed the identity of Curtis R. Smith as the Liquidating Trustee and the sole shareholder, member, officer and director of the Liquidating Debtor from and after the effective date of the Plan. (6) Section 1129(a)(6) is in applicable because there is no governmental regulatory commission with jurisdiction over any rates charged by the Debtors. (7) The Plan satisfies Section 1129(a)(7). With respect to each Impaired Class, each holder of a Claim of that Class has either accepted the Plan or will receive or retain under the Plan on account of the Claim property of a value, as of the Effective Date, that is not less than the amount the holder would receive or retain if the Debtors were liquidated on the Effective Date under Chapter 7 of the Bankruptcy Code. (8) The requirements of Section 1129(a)(8) are satisfied with respect to Classes 1, 2 and 3, which have accepted the Plan. Because Classes 4 and 5 will receive no distribution and retain no property under the Plan, they are deemed to have rejected the Plan. Because the requirements of Section 1129(a)(8) are not satisfied with respect to Classes 4 and 5, the Debtors have asked that the Court confirm the Plan under Section 1129(b) as to those Classes. Classes 4 and 5 consist of Equity Interests and Intercompany Claims. The Plan is fair and equitable with respect to these Claims because no Class junior to Class 4 or 5 under the Plan will receive or retain any property under the Plan on account of those junior interest. The Plan does not discriminate unfairly with respect to Holders of Claims and Equity Interests in Classes 4 and 5. (9) The Plan provides for the treatment of Administrative Expense Claims, Priority Tax Claims, and Non-Tax Claims pursuant to Section 507(a) of the Bankruptcy Code, in accordance with Section 1129(a)(9), except to the extent that the holder of a particular Claim has agreed in writing to a different treatment. (10) As required by Section 1129(a)(10), and as demonstrated by the Plan Vote Certification, at least one impaired Class of Claims has accepted the Plan, determined without including any acceptance of the Plan by an insider. (11) The Plan is feasible, thus satisfying Section 1129(a)(11). The Debtors have demonstrated that, on and after the Effective Date, they will have the ability to meet their financial obligations under the Plan and liquidate their remaining assets in the ordinary course. As required by Section 1129(a)(11), confirmation of the Plan is not likely to be followed by the liquidation or the need for further financial reorganization of the Debtors, except as contemplated by the Plan. (12) In accordance with Section 1129(a)(12), all fees due and payable pursuant to Section 1930 of Chapter 123 of Title 28 of the United States Code, as determined by the Court at the Confirmation Hearing will be paid by the Debtors or the Liquidating Trustee on or before the Effective Date. (13) Section 1129(a)(13), (14), (15) and (16) are not applicable to the Debtors' Chapter 11 cases. Judge Glenn also determined that the substantive consolidation of the Debtors' estates for purposes of distribution as provided for in the Plan will facilitate the consummation and implementation of the Plan; is integral to the treatment provided to creditors under the Plan; will not prejudice any creditor of the Debtors' estates; and is appropriate under the circumstances. Substantive consolidation of the Debtors, however, will not (other than for purposes related to funding Distributions under the Plan) affect: (a) the legal and organizational structure of the Debtors, (b) executory contracts or unexpired leases that were entered into during the Bankruptcy Cases or that have been or will be assumed or rejected, (c) any agreements entered into by the Liquidating Trust on the Effective Date, and (d) the Debtors' or the Liquidating Trust's ability to subordinate or otherwise challenge Claims on an entity by entity basis. The Confirmation Order incorporated the non-material modification and changes set forth in the revised proposed confirmation order, as previously reported. The modifications of the Plan proposed by the Debtors prior to, at or in connection with the Confirmation Hearing, as set forth in the Confirmation Order, have been reviewed by and are not objected to by any party-in-interest, or else any objections have been withdrawn or overruled, Judge Glenn ruled. The Plan Modifications do not adversely change the treatment of the Holders of Claims against or Equity Interests in the Debtors, the bankruptcy judge acknowledged. A full-text copy of the Confirmation Order dated Dec. 20, 2011 is available for free at: http://bankrupt.com/misc/Borders_Dec20ConfirmationOrder.pdf * * * Borders submitted to the U.S. Securities and Exchange Commission on December 22, 2011, supplemental disclosure regarding the confirmation of the Plan. The Plan contemplates a full liquidation of the Debtors' remaining assets. Under the Plan, a Liquidating Trust will be created. On the Effective Date, the Debtors will transfer and assign to the Liquidating Trust substantially all property and assets of the Debtors. Proceeds of those assets will constitute Liquidating Trust assets. The proceeds of liquidation will be distributed to the holders of Allowed Priority Non-Tax Claims and Allowed Secured Claims. In the manner provided in the Plan, to the extent there are assets remaining in the Liquidating Trust after payment of those claims, all Holders of Allowed General Unsecured Claims will receive the remaining assets on a Pro Rata Share basis. The Plan also governs the payment of Allowed Administrative Claims and Allowed Priority Tax Claims. As of the Effective Date, unless otherwise specified in the Plan, each executory contract or unexpired lease of the Debtors not previously expired or terminated by the Debtors will be deemed rejected on the Confirmation Date. Indemnification Obligations of the Debtors will continue as obligations of the Liquidating Trust, and will survive confirmation of the Plan, subject to conditions. As of December 21, 2011, Borders had 71,226,145 shares of common stock outstanding. On the Plan Effective Date, all Equity Interests in Borders, including all issued and outstanding common stock and securities convertible into common stock, will be canceled and extinguished without further action. On the Plan Effective Date, the registrant will issue one share of stock to the Liquidating Trust which will hold the share of stock for the benefit of the holders of Liquidating Trust Interests, and the share of stock will remain outstanding until Borders is dissolved in accordance with the Plan. The effective date of the Plan is defined in the Plan as the date on which these conditions have been satisfied: (1) the Confirmation Order is a Final Order not subject to a stay or injunction; (2) the Confirmation Order provides that all transfers of property by the Debtors (a) to the Liquidating Trust are or will be valid and effective, and meet additional requirements provided for in the Plan, and (b) to the Holders of Claims under the Plan are for good consideration and value; (3) the Plan is filed; and (4) all transfers, and all agreements necessary to implement the Plan's provisions, have been effected. Pursuant to the Plan, if the conditions precedent to the Effective Date are not met within 180 days after the Confirmation Date, or the later date as will be determined by the Debtors, the Confirmation Order may be vacated by the Court. About Borders Group Borders Group operated book, music and movie superstores and mall based bookstores under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders-branded airport stores in the United States. At Jan. 29, 2011, the Company operated 639 stores in the United States and 3 in Puerto Rico. The Company also operated a proprietary e-commerce Web site -- http://www.Borders.com/-- launched in May 2008, which included 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 roughly 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 is completing going-out-of-business sales that began at all of its remaining locations in July. The creditors? committee said before the liquidation began that Borders expected to generate $252 million to $284 million in cash from the sales. Borders is selling store leases separately. 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. The Court will convene a hearing to consider confirmation of the Liquidating Plan on Dec. 20, 2011. Bankruptcy Creditors' Service, Inc., publishes BORDERS BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Borders Group Inc. and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) BORDERS GROUP: Wins Approval of Next Jump Settlement Agreement -------------------------------------------------------------- Judge Martin Glenn authorized Borders, Inc. and Borders Properties, Inc., to enter into a settlement agreement with Daniel Angus and Next Jump, Inc. for the dismissal of the Debtor's adversary complaint against Next Jump with prejudice and the exchange of mutual releases of the parties. The release under the Settlement is limited to Next Jump and OO.com, and their employees, officers and directors. Next Jump also agrees to the dismissal of its motion to withdraw the reference of the complaint from the Bankruptcy Court. Nothing in the Court's order or the Settlement Agreement will be construed to release any of Borders' or Next Jump's rights and obligations in connection with a previous Stipulation and Order in connection with Plaintiffs' Request for a Temporary Restraining Order and Preliminary Injunction, Judge Glenn clarified. About Borders Group Borders Group operated book, music and movie superstores and mall based bookstores under the Borders, Waldenbooks, Borders Express and Borders Outlet names, as well as Borders-branded airport stores in the United States. At Jan. 29, 2011, the Company operated 639 stores in the United States and 3 in Puerto Rico. The Company also operated a proprietary e-commerce Web site -- http://www.Borders.com/-- launched in May 2008, which included 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 roughly 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 is completing going-out-of-business sales that began at all of its remaining locations in July. The creditors? committee said before the liquidation began that Borders expected to generate $252 million to $284 million in cash from the sales. Borders is selling store leases separately. 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. The Court will convene a hearing to consider confirmation of the Liquidating Plan on Dec. 20, 2011. Bankruptcy Creditors' Service, Inc., publishes BORDERS BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Borders Group Inc. and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) BP CLOTHING: Has Interim OK on Factoring Deal With First Capital ---------------------------------------------------------------- BP Clothing LLC won interim authority to enter into a postpetition Factoring and Security Agreement among the Debtor and non-debtor affiliates TeAmo LLC, KLS Collection LLC and Susie Rose LLC, on the one hand, and FCC LLC d/b/a/ First Capital Western Region LLC as Factor, on the other hand. The Factor purchases certain accounts receivable of the Debtor. Under the DIP Factoring Agreement, BP Clothing is authorized to request advances up to an aggregate principal amount, including amounts owed to Factor and outstanding as of the Petition Date of $10 million at any one time outstanding. However, the Court's Interim Order only permits the Debtor to request additional advances or use cash collateral of up to $1.6 million. The terms of the DIP Factoring Agreement runs from Dec. 12, 2011, through the earlier of (i) the date that the Debtor is no longer a debtor in possession and (ii) June 8, 2012. The agreement calls for interest payment with respect to advances outstanding on the Petition Date at LIBOR plus 4.75%. With respect to Advances made on and after the Petition Date, the rate is LIBOR plus 6.5%. BP Clothing is required to pay the Factor on the date of the DIP Agreement a $50,000 facility fee. The Borrower will also pay all reasonable costs incurred by the Factor pursuant to the DIP Agreement, including the Factor's attorney fees. BP Clothing also won permission to use cash collateral securing obligations to the Factor and to the prepetition senior term lenders led by Guggenheim Corporate Funding LLC, as Administrative Agent acting on behalf of the Senior Term Lenders. As of the petition date, the Debtor owes the lenders not less than $42,125,000. BP Clothing and its affiliates are parties to prepetition Factor Agreements with the Factor. The Factor has outstanding loans and advances in the principal amount, as of the Petition Date, of $3,668,167. As security for the Factor Obligations, the Factor has a first priority perfected lien, prior to liens of the prepetition agent and senior term lenders. The Debtor is also a party to a 2006 Credit Agreement with, among others, MVC Capital Inc., as administrative agent for the lenders. The MVC Credit Agreement provided for a $10,000,000 loan, which matures on July 18, 2012. As of the petition date, $11,781,586 remains outstanding including payment-in-kind interest. The Interim Order permits the Debtor to grant adequate protection liens, adequate protection superpriority claims, and adequate protection payments for the use of the Cash Collateral. The Debtor said it needs the ability to obtain the advances under the DIP Factoring Agreement so it can fund its day-to-day operations. Without the DIP Agreement, the Debtor would not have access to any liquidity. The Debtor also has determined that use of cash collateral alone would not permit sufficient liquidity to continue its operations without material interruption. A Final Hearing on the Debtor's request is scheduled for Jan. 5, 2012 at 2:00 p.m. (Eastern Time). About BP Clothing New York-based BP Clothing LLC is an apparel company specializing in the design, manufacture and sale of women's apparel products. The business primarily consists of selling merchandise directly to Walmart, as well as miscellaneous wholesale providers. It is also involved with a third party, eFashionSolutions LLC, which hosts the Web site http://www.babyphat.com/ It sells certain of its inventory through the Web site, and pays a percentage of sales to E-Fashions. BP Clothing LLC is wholly owned by BP Clothing Holdings LLC. BP Clothing LLC filed a chapter 11 case (Bankr. S.D.N.Y. Case No. 11-15696) on Dec. 12, 2011, to effectuate a proposed restructuring that will substantially reduce debt and enhance the Debtor's liquidity. The Debtor intends to emerge from bankruptcy quickly. Judge Shelley C. Chapman presides over the case. Michael S. Fox, Esq., and Sherri D. Lydell, Esq. -- mfox@olshanlaw.com and slydell@platzerlaw.com -- at Olshan Grundman Frome Rosenzweig & Wolosky, LLP, serves as the Debtor's counsel. In its petition, the Debtor estimated $50 million to $100 million in both assets and debts. The petition was signed by Kevin Weber, executive vice president and CFO. FCC LLC d/b/a/ First Capital Western Region LLC as Factor, which is providing DIP financing under a Factoring Agreement, is represented by: Jeff J. Friedman, Esq. KATTEN MUCHIN ROSENMAN LLP 575 Madison Avenue New York, NY 10022 E-mail: timothy.lynes@kattenlaw.com Guggenheim Corporate Funding LLC, as Administrative Agent to the prepetition Senior Term Lenders, is represented by: Ronit J. Berkovich, Esq. WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153 E-mail: ronit.berkovich@weil.com Prior to the Petition Date, the Debtor entered into a Plan Support Agreement, pursuant to which a majority of the Senior Term Lenders and MVC Capital, Inc., have agreed to the terms of a chapter 11 plan. The Plan will substantially delever the Debtor, and will convert all of the Debtor's prepetition debt obligations into equity of the reorganized Debtor. BXP 1 LLC: Wants Stipulation Terminating Receivership Approved -------------------------------------------------------------- BXP 1 LLC, asks the U.S. Bankruptcy Court for the Southern District of New York to approve a stipulation releasing the receiver from all further duties and obligations, and terminating the receivership. The stipulation was entered among the Debtor, the receiver and creditors. On July 13, 2010, the Hon. Robert E. Torres appointed Angela Ortiz as receiver in a mortgage foreclosure action for the premises located at 1636-1640 University Avenue also known as 1636-1640 Dr. Mar. Martin Luther King, Jr. Boulevard, Bronx, New York in the County of Bronx, City and State of New York. As reported in the Troubled Company Reporter on Sept. 26, 2011, the Court confirmed the Debtor's Plan of Reorganization on Sept. 8, 2011. The Plan was amended to provide that all funds held in the Debtor's bank accounts will be paid to Lender 1636-40 Universe Debt LLC upon the Effective Date of the Plan and the amendment meets the requirements of 1127(a) and (c) with no adverse impact on the treatment of any claim or equity interest of any equity security holder and no further solicitation or voting is required. A full-text copy of the Confirmation Order is available for free at http://ResearchArchives.com/t/s?76fa The terms of stipulation include, among other things: 1. to date, the receiver has no knowledge of any outstanding obligations for the receivership; 2. the receiver will cancel her liability insurance with the Hartford Fire Insurance Company, effective as of Sept. 30, 2011, and will turn over to 1636-40 Universe Debt, LLC's counsel any refunds she receives from the liability carrier and surety within a reasonable period of time of her receipt thereof; and 3. upon payment of the funds in her possession pursuant to the directions of the parties hereto, the receiver will be deemed released by all signatories hereto from all liabilities and obligations with respect to the monies collected and paid out and all acts of the receiver arising of and by virtue of the receivership. About BXP 1 LLC Porter Ranch, California-based BXP 1 LLC owns six apartment buildings in the Bronx, New York. On July 13, 2010, Angela Ortiz was appointed as receiver of the Debtor's real property. The Debtor filed a Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-15608) on Oct. 27, 2010. Backenroth Frankel & Krinsky, LLP, represents the Debtor in the Chapter 11 case. In its schedules, the Debtor disclosed $19,356,812 in total assets and $13,931,125 in total debts as of the Petition Date. In June 2011, the Debtor and 1636-40 Universe Debt LLC, the lender, reached a stipulation consenting to the receiver's continued control of the property and the receiver's retention of Sally E. Unger, Esq. at Kossoff & Unger, as her counsel. CDC PROPERTIES: Case Dismissed for Lack of Chance to Rehabilitate ----------------------------------------------------------------- The Hon. Paul B. Snyder of the U.S. Bankruptcy Court for the Western District of Washington dismissed the Chapter 11 case of CDC Properties II, LLC. As reported in the Troubled Company Reporter on Nov. 25, 2011, in its motion, the Debtor explained that: -- there is no equity in the properties; -- there are no estate assets for any creditors other than the secured lender; and -- no reorganization is feasible or practical. The Debtor related that the State Court appointed a receiver to manage the properties during the Chapter 11 case to the behest of MLMT 2004-BPC1 Prium Portfolio LLC, as successor in interest to Wells Fargo Bank, N.A., as trustee for the registered Holders of Merrill Lynch Mortgage Trust 2004-BPC1, Commercial Mortgage Pass- Through Certificates, Series 2004-BPC1. In addition, the lender's motion for relief from the automatic stay to continue the non-judicial foreclosures remains pending. 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. In its petition, the Debtor estimated $10 million to $50 million in assets and debts. Graham & Dunn PC served as its replacement counsel. 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. CHURCH FOR ART: N.Y. Court Flips Ruling in Interpleader Action -------------------------------------------------------------- KEVIN FINN, respondent, v. CHURCH FOR ART OF LIVING, INC., ET AL., defendants, JESUS IS THE WAY MINISTRIES, INC., appellant, 2011- 00897, 2011-04152 (N.Y. Sup. Ct.), is an interpleader action arising from a contract between two not-for-profit corporations for the sale of real property located on Clinton Avenue in Hempstead. Jesus is the Way Ministries, Inc. contracted to purchase the property from Church for Art of Living, Inc. The purchaser was a tenant of the seller in the building to be purchased. Kevin Finn was the attorney for the seller. He commenced the interpleader action, inter alia, to collect his fees for the work he performed in the failed transaction. Upon signing the contract in July 2008, the purchaser remitted a down payment of $50,000, which Mr. Finn held in his escrow account. The seller attempted to schedule a closing in December 2008, declaring time of the essence. The purchaser did not attend the closing, contending that the seller had failed to make repairs to the building as required by the contract of sale. In May 2009, the seller filed for Chapter 11 bankruptcy protection in bankruptcy court, where Mr. Finn sought to recover his fee from the $50,000 held in escrow. However, in January 2010, the seller withdrew that petition, and the bankruptcy court dismissed the proceeding. Within days thereafter, the seller wrote to Mr. Finn, stating that it no longer wanted Mr. Finn to represent it, and instructing him to return the down payment to the purchaser in that the seller and purchaser had settled their dispute between them. The seller's new attorney and the purchaser also wrote to Mr. Finn, instructing him to return the down payment to the purchaser. Instead, however, Mr. Finn commenced the interpleader action, seeking a declaration that the purchaser defaulted in the real estate transaction and forfeited the down payment to the seller, and further seeking to recover his fee, plus his own attorney's fee and expenses in litigating this interpleader action, from the escrowed funds. Mr. Finn subsequently moved for summary judgment on the complaint, and the purchaser cross-moved to dismiss for lack of personal jurisdiction. The New York Supreme Court granted the motion and denied the cross motion. In a Dec. 20, 2011 Decision and Order available at http://is.gd/N7K2m1from Leagle.com, the Appellate Division of the Supreme Court of New York, Second Department, reversed the judgment and denied the plaintiff's motion for summary judgment. Summary judgment is awarded to Jesus is the Way Ministries dismissing the complaint insofar as asserted against it, and the plaintiff is directed to disburse the funds in the escrow account to Jesus is the Way Ministries. CLARE AT WATER TOWER: Hires DLA Piper as Bankruptcy Counsel ----------------------------------------------------------- The Clare at Water Tower asks for permission from the U.S. Bankruptcy Court for the Northern District of Illinois to employ DLA Piper LLP as its bankruptcy counsel. As the Debtor's counsel, DLA Piper will, among other things: a) advise the Debtor of its rights, powers and duties as debtor and debtor in possession while operating and managing its business and property under chapter 11 of the Bankruptcy Code; b) prepare on behalf of the Debtor all necessary and appropriate applications, motions, proposed orders, other pleadings, notices, schedules and other documents, and reviewing all financial and other reports to be filed in this chapter 11 case; c) advise the Debtor concerning, and preparing responses to, applications, motions, other pleadings, notices and other papers that may be filed by other parties in this chapter 11 case; d) advise the Debtor with respect to, and assisting in the negotiation and documentation of, financing agreements and related transactions; and e) review the nature and validity of any liens asserted against the Debtor?s property and advising the Debtor concerning the enforceability of such liens. DLA Piper will charge for its legal services on an hourly basis in accordance with its ordinary and customary hourly rates in effect on the date the services are rendered1. The firm will also seek reimbursement of actual and necessary out-of-pocket expenses. The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About The Clare at Water Tower The Clare at Water Tower is an upscale 334-unit high-rise continuing-care retirement community in Chicago, Illinois. The project is only 42% occupied because the target population either hasn't been able to sell homes or lacks sufficient cash to make required deposits as the result declining investments following the recession. The facility is a 53-story building on land rented from Loyola University of Chicago. The facility is managed and developed by a unit of the Franciscan Sisters of Chicago, who invested more than $14 million. The project opened in December 2008. Residents must make partially refundable deposits ranging from $263,000 to $1.2 million. Monthly fees are an additional $2,700 to $5,500. The Clare filed for Chapter 11 protection (Bankr. N.D. Ill. Case No. 11-46151) on Nov. 14, 2011, after defaulting on $229 million in tax-exempt bond financing used to build the project. Judge Susan Pierson Sonderby presides over the case. Matthew M. Murphy, Esq., at DLA Piper LLP, serves as the Debtor's counsel. Epiq Bankruptcy Solutions serves as claims and noticing agent. In its petition, the Debtor estimated $100 million to $500 million in assets and debts. The petition was signed by Judy Amiano, president. Counsel to Redwood Capital Investments LLC as DIP Lender are Mark A. Berkoff, Esq., and Nicholas M. Miller, Esq., at Neal Gerber & Eisenberg LLP. Bond Trustee, The Bank of New York Mellon Trust Company, is represented by Clifton R. Jessup, Jr., Esq., at Greenberg Traurig. Counsel to Bank of America, N.A., the Debtor's prepetition lender, is Brian I. Swett, Esq., at Winston & Strawn LLP. Counsel for the majority fixed rate bonds is Nathan F. Coco, Esq., at McDermott Will & Emery LLP. Loyola, the Debtor's landlord, is represented by Timothy R. Casey, Esq., at Drinker Biddle & Reath LLP. The United States Trustee in Chicago appointed seven members to the official committee of unsecured creditors. CLARE AT WATER TOWER: Taps Houlihan Lokey as Financial Advisor -------------------------------------------------------------- The Clare at Water Tower asks for permission from the U.S. Bankruptcy Court for the Northern District of Illinois to employ Houlihan Lokey Capital, Inc., as its investment banker and financial advisor, nunc pro tunc to the Petition Date. As a result of its prepetition work performed on behalf of the Debtor, Houlihan Lokey has acquired knowledge of the Debtor and its business and is intimately familiar with the Debtor?s financial affairs, debt structure, operations and related matters. In addition to providing any additional investment banking and financial advisory services as the Debtor may request from time to time, Houlihan Lokey will assist in the evaluation of strategic alternatives and render investment banking and financial advisory services to the Debtor in connection with this chapter 11 case, including, without limitation: a) conducting immediate and comprehensive due diligence on the operations, assets and claims (priorities and collateral); b) reviewing the transaction timeline and assisting the company in obtaining necessary creditor support and liquidity for the process; c) assisting the Company in the development, preparation and distribution of selected information, documents and other materials in an effort to create interest in and to consummate any Transaction(s), including, if appropriate, advising the Company in the preparation of any teaser summary materials, confidentiality agreements, offering memoranda, data rooms, etc.; d) soliciting and evaluating indications of interest and proposals regarding any Transaction(s) from current and/or potential lenders, equity investors, acquirers and/or strategic partners; e) assisting the Company with the development, structuring, negotiation and implementation of any Transaction(s), including participating as a representative of the Company in negotiations with creditors and other parties involved in any Transaction(s); f) evaluating all strategic alternatives available to the Company throughout the process; g) providing expert advice and testimony regarding financial matters related to any Transaction(s); h) advising and attending meetings of the Company?s Board of Directors, creditors groups, official constituencies and other interested parties, as the Company and Houlihan Lokey determine to be necessary or desirable; and i) providing such other financial advisory and investment banking services as may be agreed upon by Houlihan Lokey and the Company. Houlihan Lokey intends to apply for compensation for professional services rendered and reimbursement of actual and necessary expenses incurred. The firm will charge the Debtor based on this Fee Structure: a) Monthly Fees: The Debtor shall pay Houlihan Lokey in advance, without notice or invoice, a nonrefundable cash fee of $75,000. Twenty five percent (25%) of the fourth and fifth Monthly Fees and 50% of all Monthly Fees after the fifth Monthly Fee will be credited against any portion of a Sale Transaction Fee in excess of the Minimum Transaction Fee to which Houlihan Lokey become entitled, it being understood and agreed that no Monthly Fee will be credited more than once and in no event will a Sale Transaction Fee be reduced below the Minimum Transaction Fee. b) Restructuring Transaction Fee: Upon completion of a Restructuring Transaction, (which shall be the date of confirmation of a plan under the Bankruptcy Code pursuant to an order of the applicable bankruptcy court), the Debtor will pay Houlihan Lokey a fee equal to $2,000,000. c) Sale Transaction Fee: Upon the closing of a Sale Transaction of all or substantially all of the Company?s operations, the Debtor will pay Houlihan Lokey immediately and directly from the gross proceeds of such Sale Transaction, a cash fee equal to the Minimum Transaction Fee plus incentive fees based upon Aggregate Gross Considerations, calculated as follows: i) For AGC from $80 million to $95 million: 2% of such incremental AGC; ii) For AGC from $95 million to $105 million: 4% of such incremental AGC; and iii) For AGC in excess of $105 million: 6% of such incremental AGC. d) Financing Transaction Fee: Upon the closing of each Financing Transaction, the Debtor will pay Houlihan Lokey immediately and directly from the gross proceeds of such Financing Transaction, a cash fee equal to the greater of (x) $250,000 and (y) the sum of: (i) 2.5% of the gross proceeds of senior indebtedness raised or committed that is senior to other indebtedness of the Company, secured by a first priority lien and unsubordinated (other than with respect to debtor-inpossession financing); (ii) 5% of the gross proceeds of any indebtedness raised or committed that is secured by a lien (other than a first lien), is unsecured and/or is subordinated; and (iii) 7% of the gross proceeds of all equity or equity linked securities (including, without limitation, convertible securities and preferred stock) placed or committed. The Financing Transaction Fee for raising debtor-in- possession financing will be $250,000. e) Premium for Prepack: If the Company consummates a Transaction through a pre-packaged or pre-arranged Chapter 11 plan (defined as a confirmation of a plan or entry of a sale order) within six months of filing Chapter 11, the Transaction Fees (either Restructuring or Sale) will be increased by twenty percent (20%). Andrew Turnbull, a Managing Director of Houlihan Lokey, attests that the firm is a "disinterested person," as that term is defined in Section 101(14) of the Bankruptcy Code. About The Clare at Water Tower The Clare at Water Tower is an upscale 334-unit high-rise continuing-care retirement community in Chicago, Illinois. The project is only 42% occupied because the target population either hasn't been able to sell homes or lacks sufficient cash to make required deposits as the result declining investments following the recession. The facility is a 53-story building on land rented from Loyola University of Chicago. The facility is managed and developed by a unit of the Franciscan Sisters of Chicago, who invested more than $14 million. The project opened in December 2008. Residents must make partially refundable deposits ranging from $263,000 to $1.2 million. Monthly fees are an additional $2,700 to $5,500. The Clare filed for Chapter 11 protection (Bankr. N.D. Ill. Case No. 11-46151) on Nov. 14, 2011, after defaulting on $229 million in tax-exempt bond financing used to build the project. Judge Susan Pierson Sonderby presides over the case. Matthew M. Murphy, Esq., at DLA Piper LLP, serves as the Debtor's counsel. Epiq Bankruptcy Solutions serves as claims and noticing agent. In its petition, the Debtor estimated $100 million to $500 million in assets and debts. The petition was signed by Judy Amiano, president. Counsel to Redwood Capital Investments LLC as DIP Lender are Mark A. Berkoff, Esq., and Nicholas M. Miller, Esq., at Neal Gerber & Eisenberg LLP. Bond Trustee, The Bank of New York Mellon Trust Company, is represented by Clifton R. Jessup, Jr., Esq., at Greenberg Traurig. Counsel to Bank of America, N.A., the Debtor's prepetition lender, is Brian I. Swett, Esq., at Winston & Strawn LLP. Counsel for the majority fixed rate bonds is Nathan F. Coco, Esq., at McDermott Will & Emery LLP. Loyola, the Debtor's landlord, is represented by Timothy R. Casey, Esq., at Drinker Biddle & Reath LLP. The United States Trustee in Chicago appointed seven members to the official committee of unsecured creditors. CIMA LLC: Hearing on Exclusivity Extension Request Set for Jan. 17 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of Alabama will convene a hearing on Jan. 17, 2011, at 8:30 a.m., to consider CIMA, L.L.C.'s request for exclusivity extensions. The Debtor asked the Court to extend its exclusive periods to file and solicit acceptances for the proposed Chapter 11 Plan until Feb. 20, 2012, and April 20, 2012, respectively. The Debtor filed their request for an extension before the exclusive periods was set to expire on Dec. 20, 2011. The Debtors are finalizing documentation to retain local counsel in connection with the transfer of case from the Bankruptcy Court for the Southern District of Florida to the Southern District of Alabama. As reported in the Troubled Company Reporter on Dec. 1, 2011, the Court approved the transfer of the case to the behest of Bank of the Ozarks, the largest creditor of CIMA, LLC, and the Debtor's secured lender. On Oct. 17, 2011, four creditors, Shelby Concrete Company, Inc., Beard Equipment Company, Inc., Cowin Equipment Company, Inc., and Stuart C. Irby Company filed a joinder to Bank of the Ozarks' motion. About CIMA LLC Based in Ft. Lauderdale, Florida, CIMA, L.L.C., is the developer and current owner of a 200-acre parcel of land located in Mobile, Alabama, with frontage on Interstate 10, a major thoroughfare. The parcel has been subdivided into parcels, and some infrastructure work has been done. CIMA is finalizing plans with one or more investor groups for further development of this parcel. CIMA filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 11-33279) on Aug. 22, 2011. Judge Raymond B. Ray presides over the case. Leslie Gern Cloyd, Esq. at Berger Singerman, P.A. represents the Debtor in its restructuring effort. The Debtor disclosed $18,876,064 in assets and $10,535,230 in liabilities as of the Chapter 11 filing. The petition was signed by J. Marion Uter, manager. CROWN MEDIA: SC Affirms Recapitalization Lawsuit Dismissal ---------------------------------------------------------- As previously disclosed, a lawsuit was brought in July 2009 in the Delaware Court of Chancery against the Board of Directors of Crown Media Holdings, Inc., Hallmark Cards, Incorporated, and its affiliates, as well as the Company as a nominal defendant, by S. Muoio & Co. LLC, a minority stockholder of the Company, regarding a recapitalization proposal which the Company received from Hallmark Cards in May, 2009. The lawsuit alleged, among other things, that the recapitalization was consummated at an unfair price and undervalued the Company. The complaint requested the court to enjoin the defendants from consummating the recapitalization transactions and award plaintiff fees and expenses incurred in bringing the lawsuit. Following the execution by the Company of the recapitalization agreements, on March 11, 2010, the plaintiff filed an amended complaint raising similar allegations and seeking rescission of the recapitalization. The recapitalization transaction was consummated on June 29, 2010. A trial took place in September 2010. On March 9, 2011, the Delaware Court of Chancery concluded that the process and the price of the recapitalization were entirely fair and entered a final judgment order in favor of the defendants on all claims and dismissed the lawsuit with prejudice. On April 7, 2011, the plaintiff filed notice of appeal. A hearing for the appeal was held on Dec. 14, 2011. On Dec. 20, 2011, the Delaware Supreme Court affirmed the ruling of the Delaware Court of Chancery. About Crown Media Studio City, Calif.-based Crown Media Holdings, Inc. (NASDAQ: CRWN) -- http://www.hallmarkchannel.com/-- owns and operates cable television channels dedicated to high quality, broad appeal, entertainment programming. The Company currently operates and distributes Hallmark Channel in both high definition (HD) and standard definition (SD) to 90 million subscribers in the U.S. Crown Media also operates a second 24-hour linear channel, Hallmark Movie Channel, available in both HD and SD, which focuses on family-friendly movies with a mix of classic theatrical films, presentations from the acclaimed Hallmark Hall of Fame library, original Hallmark Channel movies and special events. The Company's balance sheet at Sept. 30, 2011, showed $935.63 million in total assets, $717.89 million in total liabilities and $217.74 million total stockholders' equity. Going Concern KPMG LLP, in Denver, the Company's independent registered public accounting firm, rendered a going concern opinion in connection with the financial statements included in the Company's annual report on form 10-k for the year ended Dec. 31, 2009. The independent auditors noted of the Company's significant short-term debt obligations. KPMG LLP, however, did not issue a going concern opinion in its report on the Company's 2010 financial statements. * * * As reported by the TCR on July 25, 2011, Standard & Poor's Ratings Services assigned Studio City, Calif.-based cable network company Crown Media Holdings Inc. its 'B' corporate credit rating. The outlook is stable. "The stable rating outlook reflects our expectation that the company could reduce its lease-adjusted leverage over the intermediate term through EBITDA growth and modest debt repayment, barring any unforeseen events," S&P said. COLONY RESORTS: Cancels Joint Services Pact with Resorts Int'l -------------------------------------------------------------- Colony Resorts LVH Acquisitions, LLC, and Resorts International Holdings, LLC, agreed to terminate the Joint Services Agreement and the Joint Marketing Agreement, each as amended and restated. The Joint Services Agreement provided for the joint procurement of certain goods and services in the areas of insurance, risk management, legal, information technology, entertainment bookings and purchasing. The Joint Marketing Agreement provided for the joint promotion of certain advertising, marketing and promotion efforts. The parties determined that the continuation of those agreements is no longer in their best interest and therefore mutually agreed to terminate the agreements. Neither party will incur termination penalties. About Colony Resorts Las Vegas, Nev.-based Colony Resorts LVH Acquisitions, LLC, owns and operates the Las Vegas Hilton, a casino resort located in Las Vegas, Nevada. The Company licenses from HLT Existing Franchise Holding LLC the right to use the name "Hilton" and is part of Hilton's reservation system and Hilton's "HHonors Programs(TM). The Company's balance sheet at June 30, 2011, showed $347.55 million in total assets, $296.17 million in total liabilities, $61.80 million in redeemable members' equity, and a $10.42 million members' deficit. Default Under Term Loan On May 11, 2006, the Company entered into a Loan Agreement with Goldman Sachs Commercial Mortgage Capital, L.P. The Term Loan was for an initial principal amount of $209.2 million and for an initial term of two years. The Company has drawn an additional $40.8 million against the Term Loan, the maximum funding of the Term Loan. Covenants under the Term Loan restrict the Company's future borrowing capacity. The loan had an original two-year term and three, one-year extensions. Interest on the loan was based on LIBOR plus 2.9% with a minimum LIBOR rate of 1.5%. Interest incremented to LIBOR plus 3.5% from July 2009 through May 2010 and increased to LIBOR plus 4.0% from June 2010 through May 2011. As of July 29, 2011, the Company is in default on its Term Loan. Accordingly, the lender is entitled to exercise various rights, powers and remedies including acceleration of the Loan, termination or suspension of all or any portion of advances or disbursement of funds from restricted cash accounts, accrual of interest at the default rate and the exercise of remedies under collateral documents. The Company is currently in discussions with its lender to negotiate a restructuring of its debt. If the Company is not successful in a restructuring agreement or entering into a transaction to address its liquidity and capital structure, the note holders have the ability to demand accelerated repayment of all amounts under the Term Loan. The Company would not have the liquidity to meet this demand. According to the Company, these conditions raise substantial doubt about its ability to continue as a going concern. As reported in the TCR on March 29, 2011, Ernst & Young, in Las Vegas, Nevada, expressed substantial doubt about Colony Resorts LVH Acquisition's ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that the Company has incurred recurring net losses and has a working capital deficiency. CYBEX INTERNATIONAL: Fails to Comply with NASDAQ Bid Price Rule --------------------------------------------------------------- Cybex International, Inc., on Dec. 14, 2011, received a letter from The Nasdaq Stock Market stating that the Company continues to fail to comply with the minimum bid price requirement of $1 per share for continued listing on Nasdaq. This notice does not change the status of this matter. On Oct. 4, 2011 the Company received a determination letter from Nasdaq indicating that the Company's common stock was subject to delisting from Nasdaq because it failed to comply with the minimum stockholders' equity requirement of $10 million as required by Nasdaq Listing Rule 5450(b)(1)(A) and on June 16, 2011, Nasdaq notified the Company that it does not comply with the minimum bid price requirement of $1 per share for continued listing on Nasdaq and afforded the Company 180 calendar days, or until Dec. 13, 2011, to regain compliance with the minimum bid price continued listing requirement. The Company requested a hearing before a Nasdaq Hearings Panel to review the Determination Letter, which request stayed the suspension of the Company's common stock. The hearing was held on Nov. 10, 2011. At the hearing, the Company presented a plan to regain compliance with both the minimum stockholders' equity requirement and the minimum bid price requirement and requested that the Panel allow it additional time within which to regain compliance. As previously reported, on Nov. 15, 2011, the Company received a letter from Nasdaq notifying the Company that the Panel granted the Company's request for continued listing on Nasdaq, subject to the following conditions: * Stockholders' Equity Requirement. On or before Jan. 2, 2012, the Company must publicly announce on a Form 8-K its stockholders' equity, which shall be $10 million or greater. * Minimum Bid Price Requirement. On or before March 12, 2012, the Company will have evidenced a closing bid price above $1.00 for a minimum of 10 consecutive trading days. In order to fully comply with the terms of this exception, the Company must be able to demonstrate compliance with all requirements for continued listing on Nasdaq. In the event the Company is unable to do so, its securities may be delisted from Nasdaq. 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 net loss was $454,000 on $97.1 million of net sales for the nine months ended Sept. 24, 2011, compared with a net loss of $1.1 million on $83.0 million of net sales for the nine months ended Sept. 25, 2010. The Company's balance sheet at Sept. 24, 2011, showed $87.8 million in total assets, $103.0 million in total liabilities, and a stockholders' deficit of $15.2 million. As reported in the TCR on April 8, 2011, KPMG LLP, in Pittsburgh, Pa., expressed substantial doubt about Cybex International's ability to continue as a going concern, following the Company's results for the fiscal year ended Dec. 31, 2010. 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." DELTA PETROLEUM: Seeks to Honor Royalty & ORRI Obligations ---------------------------------------------------------- Delta Petroleum Corporation wants Bankruptcy Court authority, but not direction, to deliver to royalty owners and so-called ORRI owners the pre-petition amounts due to them for their royalties and ORRI and to honor post-petition obligations to Royalty Owners and ORRI Owners as such amounts become payable. The Debtors own leasehold interests in certain lands, which are leased by the Debtors from both government entities and private landowners. As of the end of 2010, the Debtors' leasehold position at the so-called Vega Area of the Piceance Basin in western Colorado and surrounding leasehold in Mesa County, Colorado, totaled 22,375 net acres, 48% of which is leased from the federal government, with the remaining 52% either owned by the Debtors or leased from third parties. The Debtors also own or lease additional lands in several other areas, including Washington state, Utah, other parts of Colorado and offshore California. The Debtors are obligated, pursuant to the oil and gas leases, to remit to the lessors who own the land leased by the Debtors -- Royalty Interest Owners -- their share of the production from the producing wells located on the leases, or leases and lands pooled or unitized therewith, free of expenses of production. Certain assignments of the oil and gas leases created an interest in a share of the production from the producing wells located on the leases, or leases and lands pooled or unitized therewith, free of expenses of production, that burden the Debtors' working interest in the leases -- ORRI. The Debtors are also obligated to remit to the owners of the ORRI the share of the proceeds attributable to the ORRI. The Debtors pay Royalties and ORRI two months in arrears. Amounts owed are calculated as the Debtors process revenue for oil and gas actually extracted. As of the Petition Date, the Debtors are able to determine how much is owed on account of Royalties and ORRI for the month of October 2011. However, the Debtors are unable to determine the precise amounts owed for the months of November 2011 and the portion of December 2011 that lapsed prior to the Petition Date, and such amounts remain accrued but unpaid liabilities of the Debtors. Through Dec. 12, 2011, the Debtors have received $1,086,556 on account of Royalties, which have not yet been remitted to Royalty Owners. Of that amount, $801,603 relates to the Vega Area for October 2011 production, and $284,953 relates to Point Arguellos for September 2011, as the non-operating properties are paid three months in arrears. Royalty Interest Owners and ORRI Owners are paid in arrears and should be paid promptly. Non-payment of the Royalties and ORRI could jeopardize the oil and gas leases. The Royalty Interest Owners and ORRI Owners might present legal arguments that might allow them to terminate leases on account of non-payment, and that such termination might not be affected by the automatic stay imposed in the Chapter 11 Cases. The Debtors also operate a number of the oil and gas wells in which they own an interest. Many of the wells are operated by Debtors under joint operating agreements -- JOAs -- with other parties. As a part of insuring that these wells continue operating, the Debtors incur numerous current lease operating expenses -- LOEs. Many of the invoices for the LOEs will cover both pre-petition and post-petition expenses. Given the number of such invoices, and the Debtors' limited accounting staff, separating the pre-petition portions from the post-petition portions of each individual invoice will be impractical or even impossible for the Debtors to accomplish timely. Therefore, the Debtors request authority to continue to satisfy the LOE obligations as they arise in the ordinary course of business. The Debtors also own working interests in wells operated by third parties under various JOAs. The third party operators pay the Debtors their share of production revenues. The Debtors also pay the third party operators for their share of the costs to operate the wells through the payment of joint-interest billings -- JIBs. The failure to timely pay JIBs may provide grounds for the operator to assert contractual or statutory lien rights against the Debtors' interest in a well and the underlying oil and gas lease. Therefore, the Debtors request authority to continue to satisfy these JIBs as they arise in the ordinary course of business. If the Debtors fail to satisfy the LOE, JOA and JIB obligations as they come due, the Debtors' operations will be severely impacted and production may completely cease for certain wells. About Delta Petroleum Delta Petroleum Corporation -- http://www.deltapetro.com/-- is an independent oil and gas company engaged primarily in the exploration for, and the acquisition, development, production, and sale of, natural gas and crude oil. Natural gas comprises over 90% of Delta's production services. The core area of its operations is the Rocky Mountain Region of the United States, where the majority of the proved reserves, production and long- term growth prospects are located. Delta and seven of its subsidiaries sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 11-14006 to 11-14013, inclusive) on Dec. 16, 2011, roughly six weeks before the Jan. 31, 2012 scheduled maturity of its $38.5 million secured credit facility with Macquarie Bank Limited and after several months of unsuccessful attempts to sell the business. Delta disclosed $375,498,248 in assets and $310,679,157 in liabilities, which also include $152,187,500 in outstanding obligations on account of the 7% senior unsecured notes issued in March 2005 with US Bank National Association indenture trustee; and $115,527,083 in outstanding obligations on account of 3-3/4% Senior Convertible Notes due 2037 issued in April 2007. W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A. Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard & Reed LLP, in New York, represent the Debtors as counsel. Derek C. Abbott, Esq., Ann C. Cordo, Esq., and Chad A. Fights, Esq., at Morris, Nichols, Arsht & Tunnel LLP, in Wilmington, Del., represent the Debtors as co-counsel. Conway Mackenzie is the Debtors's restructuring advisor. The Debtors selected Epiq Bankruptcy Solutions, LLC as claims and noticing agent. The petition was signed by Carl E. Lakey, chief executive officer and president. DUNE ENERGY: Inks Indemnification Agreements with Directors ----------------------------------------------------------- Dune Energy, Inc., entered in to an Indemnification Agreement with each of the Company's directors, Steve Barrenechea, Alan Bell, Richard Cohen, William Greenwood, Steve Sisselman and James Watt. The Indemnification Agreements provide that the Company will indemnify each person subject to an Indemnification Agreement to the fullest extent permitted by applicable law against all expenses, judgments, penalties, fines and amounts paid in settlement of certain proceedings that may result or arise in connection with such Indemnified Party serving in his capacity as an officer or director of the Company, or is or was serving at the request of the Company as an officer, director, employee or agent of another entity. The Indemnification Agreements further provide that, upon an Indemnified Party's request, the Company will advance expenses to the Indemnified Party. Pursuant to the Indemnification Agreements, an Indemnified Party is presumed to be entitled to indemnification and anyone seeking to overcome this presumption has the burden of proving otherwise. In addition, on Dec. 21, 2011, the Restructuring Support Agreement, dated as of Oct. 6, 2011, as amended by the First Amendment to Restructuring Support Agreement, dated as of Oct. 31, 2011, and the Second Amendment to Restructuring Support Agreement, dated as of Nov. 8, 2011, by and among the Company and the noteholders party thereto entered into a Third Amendment to Restructuring Support Agreement pursuant to which Section 3 of the RSA was amended to provide that on or prior to Jan. 13, 2012, the Company will take all steps reasonably necessary and work in good faith, to the extent permissible and valid under applicable law, to (i) facilitate the appointment of each of the people proposed by the Noteholders to the board of directors of the Company and (ii) obtain the resignations of each of the directors (other than James A. Watt) serving on the Board immediately prior to the appointment of those new directors. About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company reported a net loss of $75.53 million on $64.18 million of revenue for the year ended Dec. 31, 2010, compared with a net loss of $59.13 million on $52.24 million of revenue during the prior year. The Company's balance sheet at Sept. 30, 2011, showed $271.17 million in total assets, $376.85 million in total liabilities, $156.56 million in redeemable convertible preferred stock, and a $262.24 million total stockholders' deficit. * * * As reported by the TCR on Oct. 14, 2011, Standard & Poor's Ratings Services lowered its unsolicited corporate credit rating on Dune Energy to 'CC' from 'CCC-'. "We view this transaction as a distressed exchange offer as bondholders and holders of preferred stock would be receiving less value than the promise under the original securities. Upon completion of the exchange offer, we would expect to lower our unsolicited senior secured debt rating to 'D' from 'CC' and the unsolicited corporate credit rating to 'SD' from 'CC'. In the event of a prepackaged bankruptcy, we would expect to lower the corporate credit rating to 'D' from 'CC,'" S&P related. DYNEGY INC: Sec. 341 Meeting of Creditors Set for Jan. 20 --------------------------------------------------------- Tracy Hope Davis, the U.S. Trustee for Region 2, will convene a meeting of the creditors of Dynegy Holdings LLC and its Debtor affiliates on January 20, 2012, at 10:00 a.m. Eastern Time at: Office of the United States Trustee 355 Main Street, First Floor Poughkeepsie, New York 12601 This is the first meeting of creditors under Section 341(a) of the Bankruptcy Code. The meeting offers creditors a one-time opportunity to examine the Debtors' representative under oath about the Debtors' financial affairs and operations that would be of interest to the general body of creditors. Attendance by the Debtor's creditors at the meeting is welcome, but not required. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7 to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. Dynegy was advised by Lazard Freres & Co. LLC and the Debtor Entities' financial advisor is FTI Consulting. Bankruptcy Creditors' Service, Inc., publishes DYNEGY BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Dynegy Inc. (http://bankrupt.com/newsstand/or 215/945-7000) DYNEGY INC: Court Orders Examiner in Debtor's Cases --------------------------------------------------- Judge Cecilia Morris of the U.S Bankruptcy Court for the Southern District of New York said an examiner will be appointed in the Debtors' bankruptcy case, The Wall Street Journal and Bloomberg News reported. Joseph Checkler of the Journal related that the examiner will get 60 days to look into the way Dynegy affiliates moved assets related to its parent company out of the reach of the holding company's creditors, capping a series of transactions that reshuffled its structure and location of assets. After that initial 60 days, additional time can be added, but only with court approval, the report related. The examiner will be selected by the U.S. Trustee. "This examiner will have unfettered access to all documents requested," Judge Morris said, adding that creditors could not "tag along" in the investigation, according to the Journal. Bondholders led by trustee U.S. Bank, a unit of U.S. Bancorp, had asked for the examiner to investigate a transfer of assets by Dynegy Inc. before the Chapter 11 filing to keep them out of the reach of creditors. Hedge-fund manager David Tepper's Appaloosa Management LP also called for the examiner. "This is a classic insider transaction that needs to be investigated," Andrews Kurth LLP's Paul N. Silverstein, a lawyer for Appaloosa Management LP, told the Journal. David Tepper's Appaloosa also called for an examiner. "There are a lot of things that are wrong with this transaction," Mr. Silverstein added, referring to Dynegy's asset movements. Sidley Austin LLP's John Hutchinson, a Dynegy lawyer, said the call for an examiner was "a clear attempt to derail" the bankruptcy process, and would ensure the case "grinds to a halt," the Journal related. Mr. Hutchinson, according to the Journal, wanted the judge to either deny the examiner motion or at least defer a ruling. Judge Morris will convene a hearing on Dec. 28, 2011, at 10:00 a.m., to further discuss matters relating to the appointment of a Chapter 11 examiner in the Debtors' bankruptcy cases. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7 to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. Dynegy was advised by Lazard Freres & Co. LLC and the Debtor Entities' financial advisor is FTI Consulting. Bankruptcy Creditors' Service, Inc., publishes DYNEGY BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Dynegy Inc. (http://bankrupt.com/newsstand/or 215/945-7000) DYNEGY INC: Court Approves Rejection of Facility Leases ------------------------------------------------------- Judge Cecelia G. Morris, bankruptcy judge of the U.S. Bankruptcy Court for the Southern District of New York, signed on Dec. 20, a stipulated order granting the Debtors' request to reject certain leases known as "Facility Leases" and other executory agreements and unexpired leases. The rejection of each of the lease documents is authorized and approved, or, to the extent they are not executory contracts or unexpired leases, will be treated as prepetition claims against the Debtors, subject to allowance or disallowance in subsequent proceedings. The Debtors' entry into the term sheet, and each of the terms thereof are approved, subject to these provisions: -- Resources Capital Management Corporation or its designee is granted an allowed unsecured claim known as "TIA Claim" against Dynegy Holdings amounting $110 million and a cash payment amounting $7.5 million to be paid by Dynegy or a non-Debtor subsidiary thereof within five days of the effective date of the Order, in each case in exchange for the settlement and compromise of all rights and claims of the PSEG Entities under the Tax Indemnity Agreements and the Guarantees; -- the TIA Claim and the Cash Payment will not be subject to the limitations contained in Section 502(b)(6) of the Bankruptcy Code; and -- the TIA Claim and the Cash Payment will be separate from and not included in any claim ultimately allowed for damages arising from or related to the rejection or termination of the Facility Leases. A full-text copy of the Term Sheet is available for free at: http://bankrupt.com/misc/DynegyLeaseTSht.pdf Objections to the provisions of the Stipulation must be filed by Dec. 26. The Court will address objections on Dec. 28. In the absence of a further Court order, the Debtors will operate the Leased Facilities until (i) they obtain regulatory approval to transfer those facilities -- or not to operate them -- or (ii) U.S. Bank National Association and the Debtors reach an alternate arrangement. The Debtors, the Committee and U.S. Bank will work in good faith to resolve issues relating to the transfer or shutdown of the Leased Facilities and to agree upon a schedule and mechanism to address matters in a timely fashion. Judge Morris also rules that by January 6, 2012, U.S. Bank will set forth in a pleading or proof of claim a plain statement of the nature, priority and, to the extent determinable at that time, the amount of all pre- and postpetition claims against the Debtors. Prior to and after the Order becomes effective, all parties preserve their rights with respect to all issues relating to (i) the claims and contentions raised in U.S. Bank's adversary proceeding, including the Debtors' defenses thereto, (ii) the effective date of the rejection of the Lease Documents, provided that, in addressing the effective date issue, no party will argue that the date of entry of the Order occurred after December 2, 2011, (iii) the nature, priority and amount of U.S. Bank's claims against any of the Debtors, and (iv) U.S. Bank's rights to be heard by the Court with respect to the transition plan once it has had a chance to review that plan. The Order will take effect and be fully enforceable upon the 14th day after execution. Objections to the Rejection Motion that were not withdrawn or resolved were overruled. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7 to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. Dynegy was advised by Lazard Freres & Co. LLC and the Debtor Entities' financial advisor is FTI Consulting. Bankruptcy Creditors' Service, Inc., publishes DYNEGY BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Dynegy Inc. (http://bankrupt.com/newsstand/or 215/945-7000) EAGLE INDUSTRIES: Creditors Committee Opposes Plan Confirmation --------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 cases of Eagle Industries, LLC, et al., asks the U.S. Bankruptcy Court for the Western District of Kentucky to deny the confirmation of the Debtors' Plan of Reorganization dated Aug. 22, 2011. According to the Committee: 1. the Plan is not feasible, because it requires continued borrowing from Citizen's First, however the lender has only committed to lend the Debtor under the facility until January 2012; 2. the Plan discriminates against the unsecured creditors, and is not fair and equitable because it does not commit substantially all of the Debtor's future profits to repaying prepetition debt; 3. the Plan violates the absolute priority rule -- the Debtor's four equity holders contributed only $17,500 each to for equity, but will receive a company either an EBITA of over $1 million; and 4. the transfer of equity to management group and the feasibility issues, the Plan fails to comply with the requirement that it be proposed in good faith. As reported in the Troubled Company Reporter on Aug. 25, 2011, the Plan contemplates that canceling of existing equity interests in the Debtor while general unsecured claims will share in the distribution of $100,000 approximately 60 days after the effective date. The Plan provides that the Debtor will continue to operate their businesses and manage their assets, which will generate income projected to be sufficient for the Debtor to meet their ongoing operating expenses and obligations contemplated under the Plan. A full-text copy of the Disclosure Statement, as amended, is available for free at: http://bankrupt.com/misc/EAGLE_disclosurestatement.pdf On Nov. 8, the Court approved a stipulation between the Debtors and PBI Bank, Inc. modifying plan regarding the secured claim of PBI Bank, Inc. The Court ordered that the fourth sentence of the paragraph describing the treatment of PBI's Class 3-B Claim is amended as: "On or before Aug. 1, 2022, the Debtors will pay the remaining principal and all accrued but unpaid interest and all accrued but unpaid attorney fees and expenses due under the terms of the prepetition promissory note or any amounts due under the Mortgages." About Eagle Industries LLC Bowling Green, Kentucky-based Eagle Industries, LLC, is engaged in furniture manufacturing, sales and delivery. Eagle Industries filed for Chapter 11 bankruptcy protection (Bankr. W.D. Ky. Case No. 10-11636) on Oct. 27, 2010. David M. Cantor, Esq., at Seiller Waterman LLC, represents the Debtor. The Debtor estimated assets and debts at $10 million to $50 million. Peter M. Gannott, Esq., at Alber Crafton, P.S.C., in Louisville, Ky., represents the Official Unsecured Creditors' Committee as counsel. EASTMAN KODAK: KKR Representatives Step Down From Board ------------------------------------------------------- Herald Chen and Adam Clammer, who joined Eastman Kodak's board in 2009 as representatives of private equity firm Kohlberg Kravis Roberts, stepped down last week, according to a securities filing Tuesday. The men obtained their seats after KKR helped Kodak with a fresh injection of funds needed to weather the recession. Kodak is again seeking funds as an expensive turnaround burns through its cash. Dana Mattioli, writing for The Wall Street Journal, reports the resignations signal KKR isn't planning to step in this time. A person familiar with the matter told WSJ that former Kodak CEO George Fisher is a senior adviser at KKR and was involved in bringing in the firm. KKR invested $300 million in Kodak via senior secured notes in 2009. The company repaid the firm for its investment in February 2010, earlier than planned. But the firm still owns 40 million warrants that are underwater at $5.50 a share. Kodak shares were unchanged at 69 cents at 4 p.m. Tuesday in New York Stock Exchange composite trading. According to WSJ, a person familiar with the matter said the KKR representatives have been looking to exit the board for some time and had grown frustrated with the pace of Kodak's turnaround. Mr. Chen heads KKR's software and Internet activities. Mr. Clammer heads KKR's global technology group. WSJ notes Messrs. Chen and Clammer didn't immediately reply to requests for comment. KKR declined to comment. Kodak didn't give a reason for their departure. Kodak doesn't intend to replace the departing directors. Its board is left with 12 board members, including CEO Antonio Perez. About Eastman Kodak Headquartered in Rochester, New York, Eastman Kodak Company (NYSE:EK) -- http://www.kodak.com/-- provides imaging technology products and services to the photographic and graphic communications markets. Kodak's balance sheet at Sept. 30, 2011, showed $5.10 billion in total assets, $6.75 billion in total liabilities and a $1.65 billion total deficit. Kodak had sales of $7.2 billion last year. Sales declined by 24 percent since 2008. The net loss last year was $687 million. During the first nine month of this year, the net loss was $647 million on sales of $4.27 billion. In July 2011, the Company announced that it is exploring strategic alternatives, including a potential sale, related to its digital imaging patent portfolios. Kodak hired Jones Day as legal adviser and investment bank Lazard Ltd., but denied rumors it was filing for bankruptcy. It also enlisted FTI Consulting Inc. In December, Kodak hired Sullivan & Cromwell's restructuring practice, replacing Jones Day. A group of Kodak's bondholders have formed an informal committee and hired law firm Akin Gump Strauss Hauer & Feld LLP for advise. * * * As reported by the TCR on Nov. 3, 2011, Fitch Ratings affirmed and then withdrew the 'CC' long-term Issuer Default Rating and issue ratings of Eastman Kodak Company. Fitch decided to discontinue the rating, which is uncompensated. Moody's Investors Service said in a report Nov. 7, 2011, that Kodak will run out of cash in the U.S. around the second or third quarters of 2012. HARRISBURG, PA: Files Second Attempt to Restore Bankruptcy ---------------------------------------------------------- American Bankruptcy Institute reports that Mark Schwartz, attorney for the Harrisburg city council, has filed court papers seeking to overturn an earlier ruling by Bankruptcy Judge Mary D. France, who refused to give the council extra time to file a notice of appeal, the first step in trying to reinstate the city's chapter 9 filing. About Harrisburg, Pennsylvania The city of Harrisburg, in Pennsylvania, is coping with debt related to a failed revamp of an incinerator. The city is $65 million in default on $242 million owing on bonds sold to finance an incinerator that converts trash to energy. The Harrisburg city council voted 4-3 on Oct. 11, 2011, to authorize the filing of a Chapter 9 municipal bankruptcy (Bankr. M.D. Pa. Case No. 11-06938). The city claims to be insolvent, unable to pay its debt and in imminent danger of having tax revenue seized by holders of defaulted bonds. Judge Mary D. France presided over the Chapter 9 case. Mark D. Schwartz, Esq. -- markschwartz6814@gmail.com -- and David A. Gradwohl, Esq., served as Harrisburg's counsel. The petition estimated $100 million to $500 million in assets and debts. Susan Wilson, the city's chairperson on Budget and Finance, signed the petition. Harrisburg said in court papers it is in imminent jeopardy through six pending legal actions by creditors with respect to a number of outstanding bond issues relating to the Harrisburg Materials, Energy, Recycling and Recovery Facilities, which processes waste into steam and electrical energy. The owner and operator of the incinerator is The Harrisburg Authority, which is unable to pay the bond issues. The city is the primary guarantor under each bond issue. The lawsuits were filed by Dauphin County, where Harrisburg is located, Joseph and Jacalyn Lahr, TD Bank N.A., and Covanta Harrisburg Inc. The Commonwealth of Pennsylvania, the County of Dauphin, and Harrisburg city mayor Linda D. Thompson and other creditors and interested parties objected to the Chapter 9 petition. The state later adopted a new law allowing the governor to appoint a receiver. Kenneth W. Lee, Esq., Christopher E. Fisher, Esq., Beverly Weiss Manne, Esq., and Michael A. Shiner, Esq., at Tucker Arensberg, P.C., represented Mayor Thompson in the Chapter 9 case. Counsel to the Commonwealth of Pennsylvania was Neal D. Colton, Esq., Jeffrey G. Weil, Esq., Eric L. Scherling, Esq., at Cozen O'Connor. In November 2011, the Bankruptcy Judge dismissed the Chapter 9 case because (1) the City Council did not have the authority under the Optional Third Class City Charter Law and the Third Class City Code to commence a bankruptcy case on behalf of Harrisburg and (2) the City was not specifically authorized under state law to be a debtor under Chapter 9 as required by 11 U.S.C. Sec. 109(c)(2). That same month, the state governor appointed David Unkovic as receiver for Harrisburg. Mr. Unkovic is represented by the Municipal Recovery & Restructuring group of McKenna Long & Aldridge LLP, led by Keith Mason, Esq. -- kmason@mckennalong.com -- co-chair of the group. HARTFORD COMPUTER: Seeks Recognition of Chapter 11 Case in Canada ----------------------------------------------------------------- Hartford Computer Hardware, Inc., seeks authority from the Bankruptcy Court to (i) act as the foreign representative of the Debtors; (ii) seek recognition by the Ontario Superior Court of Justice (Commercial List) of the Chapter 11 cases and of certain orders of the Bankruptcy Court made from time to time in the Chapter 11 cases; (iii) request that the Ontario Court lend assistance to the U.S. Bankruptcy Court; and (iv) seek any other appropriate relief from the Ontario Court that the Debtors deem just and proper. Hartford Computer Group Inc. intends to commence an ancillary proceeding under Part IV of the Companies' Creditors Arrangement Act in the Ontario Court. In connection with the Ancillary Proceeding, the appointment of an information officer is standard practice to serve as an independent party to the Ancillary Proceeding by relaying information between Hartford Computer Hardware and the court. By way of example, the Information Officer: a. reports to the court at least once every three months with respect to the status of the CCAA proceedings and the status of the Chapter 11 Cases, which reports may include information relating to Debtors' property, the business, or such other matters as may be relevant to the proceedings; b. obtains full and complete access to Debtors' property, including the premises, books, records, data, including data in electronic form, and other financial documents of Debtors, to the extent that is necessary to perform its duties; and c. will be at liberty to engage independent legal counsel or such other persons as the Information Officer deems necessary or advisable respecting the exercise of its powers and performance of its obligations. Hartford Computer Hardware intends to seek the appointment of FTI Consulting Canada Inc. as Information Officer. Hartford Computer Hardware is responsible for paying the fees of the Information Officer and its independent counsel. The Debtors' DIP lender, Delaware Street Capital Master Fund, L.P. has agreed to fund the payment to the Information Officer pursuant to a budget. About Hartford Computer Hardware Schaumburg, Illinois-based Hartford Computer Hardware Inc. and its affiliated entities are one of the leading providers of repair and installation services in North America for consumer electronics and computers. Hartford Computer Hardware operates in three complementary business lines: parts distribution and repair, depot repair, and onsite repair and installation. Products serviced include laptop and desktop computers, commercial computer systems, flat-screen television, consumer gaming units, printers, interactive whiteboards, peripherals, servers, POS devices, and other electronic devices. Hartford Computer Hardware, though all U.S. companies, operates a significant portion of their business in Markham, Ontario, Canada. Hartford Computer Hardware and three units filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Lead Case No. 11-49744) on Dec. 12, 2011. The affiliates are Hartford Computer Group Inc. (Case No. 11-49750); Hartford Computer Government Inc. (Case No. 11-49752) and Nexicore Services LLC (Case No. 11-49754). Judge Pamela S. Hollis oversees the case. John P. Sieger, Esq., Paige E. Barr, Esq., and Peter A. Siddiqui, Esq. -- john.sieger@kattenlaw.com , paige.barr@kattenlaw.com and peter.siddiqui@kattenlaw.com -- at Katten Muchin Rosenman LLP, serve as the Debtors' counsel. The Debtors' investment banker is Paragon Capital Partners, LLC; the special counsel is Thornton Grout Finnigan LLP; and the notice and claims agent is Kurtzman Carson Consultants LLC. In its petition, Hartford Computer Hardware estimated $50 million to $100 million in assets and debts. The petitions were signed by Brian Mittman, chief executive officer. HARTFORD COMPUTER: Wins Approval to Hire KCC as Claims Agent ------------------------------------------------------------ Hartford Computer Hardware Inc. won permission from the Bankruptcy Court to employ Kurtzman Carson Consultants LLC to act as the official Claims Agent of the Clerk of the Bankruptcy Court in order to assume full responsibility for the distribution of notices and proofs of claim, and maintenance, processing and docketing of proofs of claim filed in the Debtors' chapter 11 cases. KCC's normally hourly rates range from $40 to $295 per hour. Immediately prior to the petition date, the Debtor paid KCC a retainer of $25,000. As of the bankruptcy filing, the retainer had not been drawn upon. Albert H. Kass, Vice President, Corporate Restructuring Services of Kurtzman Carson Consultants, attests that the firm is a disinterested person, as defined in section 101(14) of the Bankruptcy Code, and neither Mr. Kass, nor KCC, nor any employee or officer of the firm represents any interest materially adverse to the Debtors or their estates in matters upon which KCC is to be employed. About Hartford Computer Hardware Schaumburg, Illinois-based Hartford Computer Hardware Inc. and its affiliated entities are one of the leading providers of repair and installation services in North America for consumer electronics and computers. Hartford Computer Hardware operates in three complementary business lines: parts distribution and repair, depot repair, and onsite repair and installation. Products serviced include laptop and desktop computers, commercial computer systems, flat-screen television, consumer gaming units, printers, interactive whiteboards, peripherals, servers, POS devices, and other electronic devices. Hartford Computer Hardware, though all U.S. companies, operates a significant portion of their business in Markham, Ontario, Canada. Hartford Computer Hardware and three units filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Lead Case No. 11-49744) on Dec. 12, 2011. The affiliates are Hartford Computer Group Inc. (Case No. 11-49750); Hartford Computer Government Inc. (Case No. 11-49752) and Nexicore Services LLC (Case No. 11-49754). Judge Pamela S. Hollis oversees the case. John P. Sieger, Esq., Paige E. Barr, Esq., and Peter A. Siddiqui, Esq. -- john.sieger@kattenlaw.com , paige.barr@kattenlaw.com and peter.siddiqui@kattenlaw.com -- at Katten Muchin Rosenman LLP, serve as the Debtors' counsel. The Debtors' investment banker is Paragon Capital Partners, LLC; the special counsel is Thornton Grout Finnigan LLP; and the notice and claims agent is Kurtzman Carson Consultants LLC. In its petition, Hartford Computer Hardware estimated $50 million to $100 million in assets and debts. The petitions were signed by Brian Mittman, chief executive officer. HAWKER BEECHCRAFT: J. Maslowski to Retire as Gov. Business Pres. ---------------------------------------------------------------- Hawker Beechcraft Corporation announced that Mr. James I. Maslowski, President ? Government Business, will retire from the Company, effective Jan. 31, 2012. About Hawker Beechcraft Hawker Beechcraft Acquisition Company, LLC, headquartered in Wichita, Kan., is a manufacturer of business jets, turboprops and piston aircraft for corporations, governments and individuals worldwide. The Company's balance sheet at June 30, 2011, showed $3.01 billion in total assets, $3.33 billion in total liabilities and a $317.30 million in total deficit. Hawker Beechcraft reported a net loss of $304.3 million on $2.80 billion of total sales for 12 months ended Dec. 31, 2010. Net loss in 2009 and 2008 was $451.3 million and $157.2 million, respectively. To reduce the cost of operations, in October 2010, the Company announced it would implement a cost reduction and productivity program. The first part of the program consisted of the immediate termination of approximately 8% of salaried employees while the second part involves reducing the Company's factory and shop work forces by approximately 800 employees by end of August 2011. * * * Hawker Beechcraft carries 'Caa2' corporate family and probability of default ratings from Moody's Investors Service. HOLLIFIELD RANCHES: Wants Automatic Stay in Effect Until Jan. 11 ---------------------------------------------------------------- Hollifield Ranches, Inc., asks the U.S. Bankruptcy Court for the District of Idaho to approve a stipulation with KeyBank National Association in relation to the motion for relief from automatic stay. Keybank asked the Court for relief from the automatic stay, or in the alternative for adequate protection; and for the turnover of $1.9 million of cash collateral utilized by the Debtor postpetition. The Debtor is indebted to Keybank in the amount of $13,252,153 as of Nov. 23, 2011, plus interest which continues to accrue on the foregoing, and the costs and attorneys fees. According to Keybank, the Debtor does not have an equity in the property; and the property is necessary is not necessary to an effective reorganization. The counsel for the debtor filed an objection to the motion, however, the preliminary hearing cannot be held within 30 days after the date of filing the motion. Pursuant to the stipulation, the parties agreed that the automatic stay imposed upon filing will remain in full force and effect until the preliminary hearing on KeyBank's motion, which is scheduled for hearing on Jan. 11, 2012, at 1:30 p.m. Keybank is represented by Noah G. Hillen, Esq. -- ngh@moffatt.com -- at Moffatt Thomas Barrett Rock & Fields, Chartered. About Hollifield Ranches, Inc. Hansen, Idaho-based Hollifield Ranches, Inc., filed for Chapter 11 bankruptcy protection (Bankr. D. Idaho Case No. 10-41613) on Sept. 9, 2010. Brent T. Robinson, Esq., in Rupert, Idaho, represents the Debtor. The Debtor estimated assets and debts at $10 million to $50 million as of the Chapter 11 filing. Robert D. Miller, Jr. ,the United States Trustee for Region 18, has appointed three creditors to serve as members of the Unsecured Creditors' Committee in the Chapter 11 case of Hollifield Ranches, Inc. J. Justin May, Esq., at May, Browning & May represents the Official Committee of Unsecured Creditors. HAWAIIAN TELCOM: Litigation Trustee Loses Bid to Seal Doc --------------------------------------------------------- In the lawsuit, SHULTS & TAMM, ALC as LITIGATION TRUSTEE, v. MICHAEL T. BROWN, Adv. Proc. No. 11-90011 (Bankr. D. Hawaii), Bankruptcy Judge Lloyd King denied the Plaintiff's ex parte application to file a Defendant's employment agreement under seal. The Plaintiff, as Litigation Trustee, pursuant to Hawaiian Telcom Communications Inc.'s confirmed chapter 11 plan of reorganization, seeks to recover, as avoidable preferences, fraudulent conveyances, and post-petition transfers, payments made to or for the benefit of Michael T. Brown, pursuant to termination of Mr. Brown's employment as Senior Vice President of the Debtor. Judge King said the Plaintiff's ex parte application does not explain or justify why the terms of the Defendant's employment by the Debtor should be kept confidential and be filed under seal. A copy of Judge King's Dec. 23, 2011 memorandum is available at http://is.gd/jt5FLnfrom Leagle.com. About Hawaiian Telcom Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc. -- http://www.hawaiiantel.com/-- operates a telecommunications company, which offers an array of telecommunications products and services including local and long distance service, high-speed Internet, wireless services, and print directory and Internet directory services. The Company and seven of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13086) on Dec. 1, 2008. Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware on Dec. 30, 2008, approved the transfer of the Chapter 11 cases to the U.S. Bankruptcy Court for the District of Hawaii before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005). Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, represented the Debtors in their restructuring efforts. The Debtors tapped Lazard Freres & Co. LLC as investment banker; Zolfo Cooper Management LLC as business advisor; Deloitte & Touche LLP as independent auditors; and Kurztman Carson Consultants LLC as notice and claims agent. An official committee of unsecured creditors was appointed and represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii. When the Debtors filed for protection from their creditors, they disclosed total assets of $1,352,000,000 and total debts of $1,269,000,000 as of Sept. 30, 2008. Judge King entered on Dec. 30, 2009, an order confirming a plan of reorganization for Hawaiian Telcom. The plan was declared effective in October 2010 after the Reorganized Debtors obtained the backing of the U.S. Federal Communications Commission and the Hawaii Public Utilities Commission. Shults & Tamm was appointed the litigation trustee, and is represented by: Christopher Muzzi, Esq. MOSELEY BIEHL TSUGAWA LAU & MUZZI Alakea Corporate Tower 1100 Alakea Street, 23rd Floor Honolulu, HI 96813 Telephone: (808) 531-0490 Facsimile (808) 534-0202 E-mail: cmuzzi@hilaw.us JEREMIAH O'BRIEN: Objection to $2.4MM FTBK Claim Overruled ---------------------------------------------------------- Bankruptcy Judge Alan H. W. Shiff overruled Jeremiah O'Brien's objection to a proof of claim filed by FTBK Investor LLC, as Trustee for NY Brooklyn Investor Trust 3. Mr. O'Brien holds a 100% interest in 531 Bergen LLC, which owned an apartment building in Brooklyn, New York. In June 2007, Bergen LLC executed a $1.8 million promissory note to Washington Mutual Bank. The Note was secured by a mortgage on Bergen LLC's real property. The Note and Mortgage were subsequently sold to JPMorgan Chase Bank, NA. Under the terms of the Note, interest on the principal was calculated at a rate of 6.35% per annum, with an additional 5.00% interest if a default occurred. The parties also negotiated a prepayment premium that would be due if there was an acceleration on the payment of the Note. The Note and Mortgage are governed by the New York law. In October 2008, Bergen LLC failed to make its monthly mortgage payment and defaulted. On Feb. 23, 2009, JPMorgan commenced a foreclosure proceeding against Bergen LLC. 531 Bergen LLC sought bankruptcy protection (Bankr. E.D.N.Y. Case No. 09-47172) on Aug. 21, 2009. JPMorgan moved for relief from stay to continue with its foreclosure action, which was granted on June 17, 2010. On Sept. 30, 2010, Bergen LLC's bankruptcy case was dismissed. On Oct. 15, 2010, Jeremiah O'Brien had the Property deeded to himself for no consideration. He filed for bankruptcy (Bankr. D. Conn. Case No. 10-52610) on Oct. 26, 2010. He scheduled assets of $6,560,675 and debts of $7,480,815. On Nov. 15, 2010, the Note and Mortgage were assigned to FTBK which continues to own that paper. On Feb. 28, 2011, FTBK filed a proof of claim for $2,262,763. On March 6, 2011, Mr. O'Brien objected because FTBK claims default interest for the period of time when Bergen LLC was in bankruptcy, implicitly asserting that the protections of the automatic stay instituted by Bergen LLC's bankruptcy filing extend to him. Mr. O'Brien further objects on the basis that the prepayment premium claimed by FTBK is an impermissible penalty. On July 11, 2011, Mr. O'Brien filed a "First Amended Plan of Reorganization." Under that proposed plan, FTBK is classified as a holder of a secured, impaired claim. Mr. O'Brien proposes to file a 11 U.S.C. Section 506 motion to determine the total amount of FTBK's secured claim, which "will then be paid in full in an amount re-amortized at the rate of 6% fixed interest per year for 25 years." There appears to be no dispute that Mr. O'Brien is assuming the obligations of Bergen LLC's Note and Mortgage. On Aug. 10, 2011, FTBK filed an amended proof of claim for $2,402,705, which removed any pre-petition claim for legal fees, escrow deficits, and fees receivable, and recalculated the default rate of interest rate. Although Mr. O'Brien has not filed an objection to the amended claim, there is no question that his March 6, 2011 Objection applies to it. In a Dec. 23, 2011 memorandum of decision and order available at http://is.gd/cKoDgVfrom Leagle.com, Judge Shiff held that it is undisputed that a default occurred, which triggered an acceleration of the entire principal amount of the Note. The Court also held that the language of a Prepayment Addendum to Promissory Note dated June 28, 2007, is clear that the parties contractually agreed upon a prepayment premium and that the Lender, now FTBK, could require the inclusion of the prepayment premium as part of a claim in bankruptcy. That is precisely what has occurred. Therefore, the plain language of those instruments compels the conclusion that FTBK is entitled to its claim for the prepayment premium, the judge said. The Debtor is represented by: James M. Nugent, Esq. HARLOW, ADAMS & FRIEDMAN, P.C. 300 Bic Drive, Suite 5 Milford, CT 06460 Tel: (203) 878-0661 E-mail: jmn@quidproquo.com FTBK Investor LLC, as Trustee for NY Brooklyn Investor Trust 3, is represented by: Michael S. Wrona, Esq. HALLORAN & SAGE LLP One Goodwin Square 225 Asylum Street Hartford, CT 06103 Tel: 860-297-4626 Fax: 860-548-0006 E-mail: wrona@halloran-sage.com KOREA TECHNOLOGY: Has Until Jan. 11 to Propose Chapter 11 Plan -------------------------------------------------------------- The Hon. R. Kimball Mosier of the U.S. Bankruptcy Court for the District of Utah, in a bridge order, extended until Jan. 11, 2012, Korea Technology Industry America, Inc., et al.'s exclusive periods to propose a Chapter 11 plan and solicit acceptances for that plan. About Korea Technology Korea Technology Industry America, Inc., is a subsidiary of Seoul-based Korea Technology Industry Co. that tried to squeeze crude oil from Utah's sandy ridges. Korea Technology Industry America, Uintah Basin Resources LLC, and Crown Asphalt Ridge L.L.C., filed separate Chapter 11 bankruptcy petitions (Bankr. D. Utah Case Nos. 11-32259, 11-32261, and 11-32264) on Aug. 22, 2011. The cases are jointly administered under KTIA's case. Steven J. McCardell, Esq., and Kenneth L. Cannon II, Esq., at Durham Jones & Pinegar, in Salt Lake City, serve as the Debtors' counsel. The Debtors tapped DBH Consulting, LLC, as their accountant. The Debtors disclosed US$35,246,360 in assets and US$38,751,528 in debts. Mark D. Hashimoto, in his capacity as examiner in the Debtors cases retained George Hofmann and the firm of Parsons Kinghorn Harris, P.C., as his counsel, and Piercy Bowler Taylor & Kern as his accountants and financial advisors. Richard A. Wieland, the United States Trustee for Region 19, has appointed three members to the Official Committee of Unsecured Creditors. MACKINNON TRANSPORT: Has Intent for Restructuring Under BIA ----------------------------------------------------------- Truckinginfo reports that MacKinnon Transport has filed a Notice of Intention under the Canada's Bankruptcy and Insolvency Act in order to restructure the company. According to Truckinginfo, Trucknews.com reported that the 75-year-old family owned carrier notified drivers via a satellite message on Dec. 13 that it had filed the NOI. Unconfirmed reports suggest MacKinnon is talking with Laidlaw Van, owned by Contrans, in an effort to preserve as many jobs as possible while the company focuses on survival, and ultimately, moves toward returning to its flatbed roots, Truckinginfo says. Two years ago, Truckinginfo recalls, MacKinnon Transport bought St. Thomas, Ont.-based L.E. Walker Transport, merging the company's van business into MacKinnon's own business. Unfortunately, Walker subsequently ran into difficulties and filed for creditor protection amid restructuring efforts. "Let me stress this is not a bankruptcy," adding, the firm continues to operate, with the restructuring intended to "make our company financially stronger and more competitive," the report quotes president and chief executive Evan MacKinnon as saying. Based in Guelph, Canada, Mackinnon Transport, Inc. provides transportation, warehousing, and logistics services. It offers truckload services, such as van and flatbed transportations; and legal and over dimensional, less than truckload, container overseas, cross dock, load transfer, airfreight, rail freight, cargo ship, logistics, warehousing, pick and pack, intermodal, cross border, specialized, maintenance, and inventory control services, as well as the United States domestic and Canadian domestic services. MADISON 92ND: Plan Centers on Hotel Sale, Pursue Causes of Action ----------------------------------------------------------------- Madison 92nd Street Associates, LLC, submitted to the U.S. Bankruptcy Court for the Southern District of New York a disclosure statement explaining the Chapter 11 Plan of Reorganization dated Dec. 14, 2011. The Plan was proposed by Robert Gladstone, co-manager of the Debtor. The Proponent will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the cornerstone of the Plan is the sale of the hotel and pursuit of causes of action. It is expected, but not guaranteed, that the net sale proceeds will be sufficient to pay all creditors in full. However, Courtyard Marriott Corporation, the manager of the hotel, may attempt to assert a large rejection claim. While the Proponent believes that no such claim would be allowed, it believes that any such claim will be below $500,000, and possibly zero. Moreover, the Proponent believes that Courtyard Marriott and affiliates will owe the Debtor for damages resulting from its malfeasance in the Courtyard Action, and in the Rejection Motion. However, in the event that the Court approves a larger rejection claim than the Debtor expects, the Plan will not be held up and can still confirm, as the Plan essentially represents a "pot plan", whereby the net proceeds of the sale of the hotel will be distributed to creditors in order of priority in accordance with the terms of the Plan. The Plan is intended to enable the Debtor to conduct the sale without the likelihood of a subsequent liquidation or the need for further financial reorganization. The Proponent believes that the Debtor will be able to perform its obligations under the Plan and meet its expenses after the Effective Date without further financial reorganization. Also, the Proponent believes that the Plan permits fair and equitable recoveries, while expediting the closing of the Chapter 11 Case. The Plan intends to pay creditors as: Class Estimated Percentage Recovery ----- of Allowed Claims ----------------- Class 2 GECC Secured Claims 95.8% Class 3 General Unsecured Claims Undetermined, but as high as 100% Class 4 Other Unsecured Claims Undetermined, but as high as 100% Class 5 Equity Interests Undetermined A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/MADISON_92ND_ds.pdf About Madison 92nd Madison 92nd Street Associates, LLC, owns real property improved by a hotel located at 410 East 92nd Street, New York, known as the Upper East Side Courtyard by Marriott. It filed for Chapter 11 bankruptcy protection as lender General Electric Capital Corp., owed $74 million, has scheduled a foreclosure sale for Aug. 24, 2011. The petition (Bankr. S.D.N.Y. Case No. 11-13917) was filed Aug. 16, 2011, before Judge Stuart M. Bernstein. J. Ted Donovan, Esq., at Goldberg Weprin Finkel Goldstein LLP, serves as the Debtor's counsel. It scheduled $84,471,069 in assets and $75,398,580 in debts. The petition was signed by Louis Taic, managing member of 92nd Hotel Associates, LLC and Jeffrey Kosow, managing member of JKNY, LLC, members of the Debtor. Courtyard Management Corporation, which manages and operates the hotel pursuant to a management agreement, is represented by Thomas R. Califano, Esq., and William M. Goldman, Esq., at DLA Piper LLP (US). The Bankruptcy Judge appointed an examiner to explore the best route to reorganization for the Debtor amid a rift between two investor groups. Thomas R. Slome, the examiner, tapped his firm, Meyer, Suozzi, English & Klein, P.C., as his counsel . MAYWOOD CAPITAL: Trustee Moves to Foreclose NY Properties --------------------------------------------------------- Hilary Russ at Bankruptcy Law360 reports that the trustee overseeing the post-bankruptcy affairs of Maywood Capital Corp., which was felled by allegations of an estimated $50 million mortgage investment scam by its founder, asked a New York bankruptcy court on Dec. 22 for permission to begin launching multiple foreclosure actions. According to Law360, the move came after attempts to resolve adversary suits went nowhere, either in negotiations or litigation, according to the motion filed by lawyers for post- confirmation trustee John S. Pereira. Headquartered in New York City, Maywood Consolidated Properties Inc. acquires, owns, operates and develops real property. The company and its affiliates filed for chapter 11 protection (Bankr. S.D.N.Y. Case No. 05-10986) on Feb. 19, 2005. Wayne M. Greenwald, Esq., at Wayne M. Greenwald, P.C., serves as the Debtors' counsel. Maywood Consolidated Properties did not list total assets but reported total debts of $4,338,004 when it sought protection from its creditors. MOUNTAIN PROVINCE: Mulls Potential Spinout of Kennady Project ------------------------------------------------------------- Mountain Province Diamonds Inc. announced that analysis of the final results of the Falcon airborne gravity gradiometry (AGG) survey over the Company's 100%-controlled Kennady North Project has identified over 70 geophysical targets of which 29 are considered high priority and closely resemble the known kimberlites in the Kennady Lake area. The AGG survey was flown by Fugro Airborne Surveys. On-site quality control and interpretation of the data was done by independent consultant Mr. Kit Campbell, P. Geoph., of Intrepid Geophysics, Vancouver B.C. Located within the diamond fields of Canada's Northwest Territories, the Kennady North Project encompasses thirteen leases and claims contiguous to the Company's 49%-controlled Gahcho Kue Project held in joint venture with De Beers Canada. Past exploration at Kennady North led to the discovery of the diamondiferous Faraday, Kelvin and Hobbes kimberlites. Drilling of these kimberlites returned excellent micro-diamond counts with a size frequency distribution very similar to the highly diamondiferous Gahcho Kue kimberlites, which have a fully diluted reserve grade of 1.57 carats per tonne. Commenting, Mountain Province President and CEO Patrick Evans said: "We are very excited about the large number of high priority geophysical targets that have been identified at Kennady North. Besides the excellent micro-diamond counts and size frequency distribution from the known kimberlites, a 0.40 carat diamond was recovered from a 65 kilogram sample taken from Faraday and the samples recovered from Faraday also exhibit an unusually high percentage of yellow diamonds. This is very encouraging." Mr. Evans added: "As soon as we've secured a land use permit for Kennady North, we intend following up with ground-truthing of the high priority targets in preparation for drilling next year. Mountain Province has retained Aurora Geosciences Ltd. based in Yellowknife, NWT, to manage the Kennady North exploration program." The results of the AGG survey flown over the Gahcho Kue Project will be announced once the Joint Venture has completed an analysis of the final report. Mountain Province also announced that the Company is currently giving consideration to the potential spinout of the Kennady North Project into a newly-listed public company. A final decision on the potential spinout will be taken with a view to the best interests of shareholders in Mountain Province and a study of mechanisms for the potential spinout. Patrick Evans commented: "The potential reorganization of the Company into two separate public companies would enable Mountain Province to focus on its flagship Gahcho Ku� Project while Kennady Diamonds could focus on advancing of the highly prospective Kennady North Project. Shareholders will be kept informed of any proposals advanced in terms of the possible spinout." MT. JORDAN: Utah Court Confirms Modified Bankruptcy Exit Plan ------------------------------------------------------------- Bankruptcy Judge R. Kimball Mosier confirmed an Amended Plan of Reorganization Dated Aug. 31, 2011, as Modified Nov. 29, 2011, filed by Mt. Jordan Limited Partnership after Zions First National Bank and Porter's Point LLC, the lone creditors entitled to vote on the Plan, caste their vote of approval and Zions withdrew its lone objection to the Plan. A copy of Judge Mosier's Dec. 23, 2011 Findings and Conclusions Regarding Confirmation of Debtor's Plan of Reorganization is available at http://is.gd/IJJeuvfrom Leagle.com. The Oct. 21, 2011 edition of the Troubled Company Reporter outlined the terms of the Plan. A copy of the amended disclosure statement, dated as of Oct. 7, 2011, is available for free at http://bankrupt.com/misc/mtjordan.amendedDS.dkt112.pdf Mt. Jordan Limited Partnership's primary asset is 298.75 acres of undeveloped land, and related water rights, located in Bluffdale, Utah. Mt. Jordan has held the land for many years, and has been attempting for the last several years to liquidate and divest itself of all or significant portions of the real property for the benefit of its limited partners. Mt. Jordan Limited Partnership filed for Chapter 11 bankruptcy (Bankr. D. Utah Case No. 10-37050) on Dec. 9, 2010, Judge R. Kimball Mosier presiding. Steven C. Strong, Esq. -- scs@pkhlawyers.com -- at Parsons Kinghorn Harris PC, in Salt Lake City, serves as bankruptcy counsel. The Debtor estimated its assets at $10 million to $50 million and debts at $1 million to $10 million. MT VERNON: Can Access Fannie Mae/CNB Cash Collateral Until Feb. 28 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Maryland has permitted Mt. Vernon Properties, LLC, to use cash collateral of Fannie Mae and City National Bank on a final basis pursuant to the Budget for the Supplemental Period of Dec. 1, 2011, through the earlier of (i) the transfer of title of the respective prepetition lenders' prepetition collateral or (ii) Feb. 28, 2012, for each of the prepetition lenders. The Debtor's right to use cash collateral pursuant to this Cash Collateral Order will terminate immediately upon the entry of an Order from the Bankruptcy Court (i) converting this case to a case under Chapter 7 of the Bankruptcy Code or (ii) appointing in this case a Chapter 11 examiner or trustee pursuant to Section 1104 of the Bankruptcy Code. About Mt. Vernon Properties Mt. Vernon Properties, LLC, based in Baltimore, Maryland, is the owner of many parcels of real property located in Baltimore City that the Debtor operates as multi-family rental properties. The Company filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 11-24801) on July 18, 2011. Judge David E. Rice presides over the case. Aryeh E. Stein, Esq. -- astein@meridianlawfirm.com -- at Meridian Law, LLC, in Baltimore, serves as bankruptcy counsel. The Debtor disclosed $10,237,448 in assets and $15,064,059 in liabilities as of the Chapter 11 filing. The petition was signed by Ronald Persaud, managing member of Mt. Vernon Properties II LLC, the Debtor's sole member. MT VERNON: Has Access to Colombo Bank Cash Collateral Until Feb 28 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Maryland has permitted Mt. Vernon Properties, LLC, to use cash collateral of Colombo Bank on a final basis pursuant to the Budget for the Supplemental Period of Dec. 1, 2011, through Feb. 28, 2012. The Debtor's right to use cash collateral pursuant to this Cash Collateral Order will terminate immediately upon the entry of an Order from the Bankruptcy Court (i) converting this case to a case under Chapter 7 of the Bankruptcy Code or (ii) appointing in this case a Chapter 11 examiner or trustee pursuant to Section 1104 of the Bankruptcy Code. About Mt. Vernon Properties Mt. Vernon Properties, LLC, based in Baltimore, Maryland, is the owner of many parcels of real property located in Baltimore City that the Debtor operates as multi-family rental properties. The Company filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 11-24801) on July 18, 2011. Judge David E. Rice presides over the case. Aryeh E. Stein, Esq. -- astein@meridianlawfirm.com -- at Meridian Law, LLC, in Baltimore, serves as bankruptcy counsel. The Debtor disclosed $10,237,448 in assets and $15,064,059 in liabilities as of the Chapter 11 filing. The petition was signed by Ronald Persaud, managing member of Mt. Vernon Properties II LLC, the Debtor's sole member. MT VERNON: Can Access Carrolton Bank Cash Collateral Until Feb. 28 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Maryland has permitted Mt. Vernon Properties, LLC, to use cash collateral of Carrolton Bank on a final basis pursuant to the Budget for the Supplemental Period of Dec. 1, 2011, through Feb. 28, 2012 (the "First Supplemental Period"). The Debtor's right to use cash collateral pursuant to this Cash Collateral Order will terminate immediately upon the entry of an Order from the Bankruptcy Court (i) converting this case to a case under Chapter 7 of the Bankruptcy Code or (ii) appointing in this case a Chapter 11 examiner or trustee pursuant to Section 1104 of the Bankruptcy Code. About Mt. Vernon Properties Mt. Vernon Properties, LLC, based in Baltimore, Maryland, is the owner of many parcels of real property located in Baltimore City that the Debtor operates as multi-family rental properties. The Company filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 11-24801) on July 18, 2011. Judge David E. Rice presides over the case. Aryeh E. Stein, Esq. -- astein@meridianlawfirm.com -- at Meridian Law, LLC, in Baltimore, serves as bankruptcy counsel. The Debtor disclosed $10,237,448 in assets and $15,064,059 in liabilities as of the Chapter 11 filing. The petition was signed by Ronald Persaud, managing member of Mt. Vernon Properties II LLC, the Debtor's sole member. NEBRASKA BOOK: DIP Lenders Agree to Waive November EBITDA Covenant ------------------------------------------------------------------ Nebraska Book Company will appear before the Bankruptcy Court today, Dec. 28, at 3:00 p.m. to seek authority to enter into a second amendment to the Debtors' Secured Superpriority Debtor-In- Possession Credit Agreement, dated as of July 30, 2011, with JPMorgan Chase Bank, N.A., as administrative agent and collateral agent to the DIP lenders. The Debtors will also seek permission to pay an amendment fee to the DIP Lenders, and an arrangement fee to, and reimburse the related fees and expenses of, the DIP Agent. The DIP Facility provides the Debtors with access to a $75 million revolving line of credit and a $125 million term loan, and requires the Debtors to, among other things, comply with certain financial covenants. As of Sept. 30, 2011, the Debtors have drawn the entire amount of the DIP Term Loan, have drawn $0 on the DIP Revolver, and have roughly $120 million in cash on their balance sheet. Todd R. Snyder, Senior Managing Director and Co-Head of the Restructuring and Reorganization group at Rothschild Inc., the Debtors' financial advisor and investment banker, said that in October and November 2011 the Debtors undertook a comprehensive analysis of each of their businesses in light of their Fall 2011 back-to-school rush results, which, among other things, demonstrated that the off-campus segment financial results did not meet the Debtors' expectations. The Debtors analyzed each on- and off-campus store to determine the long-term profitability of each location and construct new financial projections. As a result of these revised projections, the Debtors anticipate being unable to comply with the minimum consolidated EBITDA provisions during the term of the DIP Facility. The Debtors promptly reported to the DIP Agent the anticipated November EBITDA default and the likelihood of potential future covenant breaches, and apprised other stakeholders of the need for waiver of the Anticipated November EBITDA Default and an amendment to the Minimum Cumulative EBITDA Covenant. Following a week of intense negotiations, the Debtors and the DIP Agent, in consultation with Rothschild and both parties' other advisors, reached a tentative agreement on modified terms for the DIP Agreement and certain fees the Debtors would pay to the DIP Agent -- Arrangement Fee -- and DIP Lenders -- Amendment Fee -- in exchange therefore. On Dec. 13, 2011, to explain the Anticipated November EBITDA Default and need for covenant relief, as well as to present the terms of the Second Amendment negotiated with the DIP Agent, the Debtors and their advisors held separate calls with DIP Lenders who either (a) have signed confidentiality agreements and received material non-public information on the Debtors' financial performance and forecasts, or (b) are not party to confidentiality agreements and do not wish to receive material non-public information or forward-looking information. After briefing the two DIP Lender groups on the need for the Second Amendment, the Debtors posted public and private information, tailored for each group of DIP Lenders, to an Intralinks datasite and provided the DIP Lenders seven days to analyze the Second Amendment and either consent or reject the terms thereof. As of Dec. 20, 2011, the DIP Agent had received sufficient approval from the DIP Lenders to approve the Second Amendment. Pursuant to the Second Amendment, the DIP Lenders agreed to waive the minimum consolidated EBITDA requirement for November. The Debtors covenant with the DIP Lenders not to permit minimum consolidated EBITDA to fall below: November 2011 Waived December 2011 $26,000,000 January 2012 $50,000,000 February 2012 $46,000,000 March 2012 $44,000,000 April 2012 $41,000,000 May 2012 $41,000,000 June 2012 $41,000,000 Mr. Snyder said that, absent the waiver and covenant relief provided by the Second Amendment, the Debtors will be unable to meet the Minimum Cumulative EBITDA Covenant on a going-forward basis, allowing the DIP Lenders to call and Event of Default and terminating their obligations to provide the Debtors with access to the DIP Facility. In that event, the Debtors would either face likely dramatic cash shortfalls or be forced to refinance the DIP Facility, while refinancing is a theoretical possibility, the cost and risk of such refinancing would far outweigh the cost and risk of the Second Amendment. The Debtors entered into immaterial amendments to the DIP Agreement shortly after closing on the DIP Facility. They were not required to seek Court approval of the First Amendment. About Nebraska Book Lincoln, Nebraska-based Nebraska Book Company, Inc., is one of the leading providers of new and used textbooks for college students in the United States. Nebraska Book and seven affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case Nos. 11-12002 to 11-12009) on June 27, 2011. Hon. Peter J. Walsh presides over the case. Lawyers at Kirkland & Ellis LLP and Pachulski Stang Ziehl & Jones LLP, serve as the Debtors' bankruptcy counsel. The Debtors; restructuring advisors are AlixPartners LLC; the investment bankers are Rothschild, Inc.; the auditors are Deloitte & Touche LLP; and the claims agent is Kurtzman Carson Consultants LLC. As of the Petition Date, the Debtors had consolidated assets of $657,215,757 and debts of $563,973,688. JPMorgan Chase Bank N.A., as administrative agent for the DIP lenders, is represented by lawyers at Richards, Layton & Finger, P.A., and Simpson Thacher & Bartlett LLP. J.P. Morgan Investment Management Inc., the DIP arranger, is represented by lawyers at Bayard, P.A., and Willkie Farr & Gallagher LLP. An ad hoc committee of holders of more than 50% of the Debtors' Second Lien Notes is represented by lawyers at Brown Rudnick. An ad hoc committee of holders of the Debtors' 8.625% unsecured notes are represented by Milbank, Tweed, Hadley & McCloy LLP. The Official Committee of Unsecured Creditors selected Lowenstein Sandler LLP and Stevens & Lee, P.C., as lawyers and Mesirow Financial Inc. as financial advisers. Nebraska Book has been unable to confirm a pre-packaged Chapter 11 plan that would have swapped some of the existing debt for new debt, cash and the new stock, due to an inability to secure $250 million in exit financing. The company's exclusive period for proposing a plan is set to expire on Jan. 23. NEVADA CANCER: Disclosure Statement Hearing Continued to Jan. 26 ---------------------------------------------------------------- Nevada Cancer Institute, Bank of America, N.A., in its capacity as administrative agent on behalf of the Debtor's prepetition lenders, and the Official Committee of Unsecured Creditors appointed in the case entered into a stipulation providing for the continuance of the hearing originally scheduled for Jan. 26 to approve the Disclosure Statement explaining the Debtor's plan of reorganization and the proposed solicitation procedures. The new hearing date is Feb. 3, 2012, 11:00 a.m. According to the stipulation, the proposed counsel for the Creditors' Committee has a scheduling conflict on Jan. 26, 2012, and requested that the Hearing be rescheduled to another date to permit the Committee to be represented at the Hearing. About Nevada Cancer Institute Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. The Debtor scheduled $129,240,202 in assets and $99,801,251 in liabilities. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP; and Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEVADA CANCER: Seeks to Hire Klee Tuchin as Bankruptcy Counsel -------------------------------------------------------------- Nevada Cancer Institute seeks Bankruptcy Court authority to employ Klee, Tuchin, Bogdanoff & Stern LLP as its reorganization counsel. The firm has represented the Debtor since March 2011. Klee received $1.4 million from the Debtor within the one-year period preceding the petition date for its services. In light of the nature of the Debtor's mission and nonprofit status, Klee wrote off $790,593 in fees in the exercise of its billing discretion. Klee professionals expected to be most active in the Debtor's case are: Professional Position Hourly Rate ------------ -------- ----------- Michael L. Tuchin Partner $895 Martin R. Barash Partner $715 Courtney E. Pozmantier Associate $490 Jonathan M. Weiss Associate $290 Shanda D. Dahl Paralegal $250 About Nevada Cancer Institute Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. The Debtor scheduled $129,240,202 in assets and $99,801,251 in liabilities. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEVADA CANCER: Taps Lewis and Roca as Nevada Counsel ---------------------------------------------------- Nevada Cancer Institute wants to employ the law firm of Lewis and Roca LLP, a limited liability partnership, as its Nevada counsel to work along with Klee, Tuchin, Bogdanoff & Stern, LLP, the Debtor's principal reorganization counsel. Work on behalf of the Debtor will be performed primarily by Robert M. Charles, Jr., Esq., partner at Lewis and Roca (hourly rate $525); Dawn M. Cica, Esq., Partner at Lewis and Roca (hourly rate $505); associate Dan Kiefer, Esq., (hourly rate $205) and Marilyn Schoenike, Certified Bankruptcy Paralegal (hourly rate $225). Other Lewis and Roca attorneys and paralegals may render services on behalf of Debtor from time to time and their standard compensation rates will be used, including Susan M. Freeman, partner at Lewis and Roca (hourly rate $695). Lewis and Roca has not previously represented the Debtor or its officers or directors, except to the extent it provided assistance preparing for this bankruptcy case under the direction of Klee Tuchin. The Firm was engaged by the Debtor and obtained conflict waivers from clients in August 2011. A retainer agreement was signed by the Debtor on Sept. 2, 2011. The firm received a $25,000 retainer to which the Debtor agreed in its engagement agreement on Oct. 27, 2011. The firm performed minimal work in August and September 2011, and did not send an invoice for services until combined with October fees and costs. The firm sent an invoice for services rendered to the Debtor in August- October 2011 in the amount of $2,170.50 on Nov. 15, 2011, reflecting a pre-billing discount of $2,968.50. After client approval, that invoice was paid on Nov. 16, 2011 from the retainer. The retainer was increased by $10,000 on Nov. 21, 2011. Firm attorneys performed additional pre-bankruptcy services from Nov. 1-29, 2011 amounting to $46,740.50 of fees at standard hourly rates and $593.10 of costs, and a bill for services reflecting a $14,504.10 discount was approved by the client and paid from the retainer on Nov. 30, 2011 before the petition filing, completely exhausting the retainer. Lewis and Roca attests it does not hold or represent any interest adverse to the estate and that Lewis and Roca is a disinterested person within the meaning of 11 U.S.C. Sec. 101(14). About Nevada Cancer Institute Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. The Debtor scheduled $129,240,202 in assets and $99,801,251 in liabilities. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEVADA CANCER: Files Schedules of Assets and Liabilities -------------------------------------------------------- Nevada Cancer Institute filed with the Bankruptcy Court its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A - Real Property $110,761,361 B - Personal Property $18,478,841 C - Property Claimed as Exempt N/A D - Creditors Holding Secured Claims $95,201,076 E - Creditors Holding Unsecured Priority Claims $0 F - Creditors Holding Unsecured Nonpriority Claims $4,600,175 ------------ ----------- TOTAL $129,240,202 $99,801,251 About Nevada Cancer Institute Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP; and Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEVADA CANCER: Court Sets Jan. 30 General Claims Bar Date --------------------------------------------------------- The Bankruptcy Court has established these deadlines for filing proofs of claim in the Chapter 11 case of Nevada Cancer Institute: Jan. 30, 2012 General Claims Bar Date; Jan. 30, 2012 Last date on which any entity asserting an administrative expense claim against the Debtor's estate arising under section 503(b)(9) of the Bankruptcy Code on account of goods sold to the Debtor in the ordinary course of the Debtor's business and received by the Debtor within 20 days before the petition date, may request allowance of the 503(b)(9) Claim; April 4, 2012 Last day for any patient to file a proof of claim; June 27, 2012 Last day for all governmental units to file proofs of claim; and March 1, 2012 Last date on which the Debtor may timely file proofs of claim on behalf of creditors who have failed to file proofs of claim on their own behalf. This deadline will enable the Debtor to ascertain whether a particular creditor has filed a claim on its own behalf before the Debtor files a claim in accordance with section 501(c) and Bankruptcy Rule 3004, thereby minimizing the possibility that duplicate claims might unnecessarily be filed About Nevada Cancer Institute Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. The Debtor scheduled $129,240,202 in assets and $99,801,251 in liabilities. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP; and Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. NEVADA CANCER: Sec. 341 Creditors' Meeting Set for Jan. 12 ---------------------------------------------------------- The United States Trustee for the District of Nevada will hold a meeting of creditors under 11 U.S.C. Sec. 341(a) in the bankruptcy case of Nevada Cancer Institute on Jan. 12, 2012, at 1:00 p.m. The meeting will be held at the Foley Federal Building and U.S. Courthouse, 300 Las Vegas Blvd., South, Room 1500, in Las Vegas. The meeting was originally set for Jan. 5. The Debtor's representative must be present at the meeting to be questioned under oath by the U.S. Trustee and by creditors. Creditors are welcome to attend, but are not required to do so. About Nevada Cancer Institute Founded in 2002, Nevada Cancer Institute Holdings Co. is a nonprofit cancer institute committed to advancing the frontiers of knowledge of cancer through research, enabling affiliated physicians to provide world-class, research-linked clinical cancer services to patients, facilitating outreach and education programs aimed at raising cancer awareness, and reducing the burden of cancer on the people of Nevada. The Debtor has been designated by the State of Nevada as the State's official cancer institute, and is qualified as a nonprofit organization under section 501(c)(3) of the Internal Revenue Code. Nevada Cancer Institute filed for bankruptcy (Bankr. D. Nev. Case No. 11-28676) on Dec. 2, 2011, blaming mounting financial pressures arising from the protracted decline in the economy, decreases in medical reimbursement rates from managed care payor entities, increases in operational costs, decreases in the amount and availability of charitable donations, a reduction in research funding opportunities and increased competition. The Debtor scheduled $129,240,202 in assets and $99,801,251 in liabilities. Lisa Madar signed the petition as secretary. Chief Bankruptcy Judge Mike K. Nakagawa oversees the case. The Debtor is represented by Thomas E. Patterson, Esq., Michael L. Tuchin, Esq., and Courtney E. Pozmantier, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP; and Robert M. Charles, Jr., Esq., and Dawn M. Cica, Esq., at Lewis and Roca LLP, as bankruptcy counsel. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Alvarez & Marsal Healthcare Industry Group LLC serves as the Debtor's restructuring advisors. Lawyers at Pachulski Stang Ziehl & Jones LLP is representing the Official Committee of Unsecured Creditors appointed in the case. Counsel for Bank of America, N.A., as agent for the prepetition lenders, are Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. The proposed buyer, The Regents of the University of California on behalf of its UC San Diego Health System, is represented by James W. Kapp, III, Esq., and Gary B. Gertler, Esq., at McDermott Will & Emery. OLD CORKSCREW: Berger Singerman Notifies Change of Address ---------------------------------------------------------- Debi Evans Galler and Berger Singerman, P.A., as counsel to the Old Corkscrew Plantation, LLC, et al., notifies the U.S. Bankruptcy Court for the Middle District of Florida of the change of address and request that the Clerk of the Court change the Court's docket and matrix in the case to reflect the correct address as: Debi Evans Galler Berger Singerman, P.A. 1450 Brickell Avenue, Suite 1900 Miami, FL 33131 Tel: (305) 755-9500 Fax: (305) 714-4340 About Old Corkscrew Plantation LLC Fort Myers, Florida-based Old Corkscrew Plantation LLC, whose oranges are made into Minute Maid and Tropicana juice, filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 11-14559) on July 29, 2011, disclosing $25,264,047 in assets and $60,751,633 in debts. Old Corkscrew sought Chapter 11 protection along with its affiliates. Donald G. Scott, Esq., -- dscott@mcdowellrice.com -- at McDowell, Rice, Smith & Buchanan, in Kansas City, Missouri, serves as the Debtors' bankruptcy co-counsel. Berger Singerman, P.A., serves as their bankruptcy counsel. Arcadia Citrus Enterprises, Inc., serves as manager of their citrus growing properties. Kapila & Company serves as chief restructuring officer. The Debtors' orange groves are valued at $24 million. Scott Westlake, the Debtors' managing member, signed the petition. Mr. Westlake is also listed as the Debtors' largest unsecured creditor, with $4,827,906 owed. Another $338,511 debt is owed to Scott and Vicki Westlake. No trustee or examiner has been appointed in this Chapter 11 case. An official committee of unsecured creditors was appointed and is represented by counsel. OLDE PRAIRIE: Court Says Plan Must Permit Lender' to Credit Bid --------------------------------------------------------------- Bankruptcy Judge Jack B. Schmetterer said Olde Prairie Block Owner LLC's Updated Third Amended Plan of Reorganization is tantamount to a sale of assets. Judge Schmetterer said the plan will be rejected and the Debtor's case will be dismissed unless the Debtor promptly makes changes that would grant secured creditor CenterPoint Properties Trust the right to credit bid. The Plan provides that all the Debtor's assets be transferred to control of new principals in exchange for assumption of the Debtor's liabilities to all creditors. Landmark America LLC and Winners Development LLC 3 will each be 50% owners of a new joint venture, in exchange for equity contributions made to the Joint Venture including cash and non-cash equity contributions. The cash contribution will be in the amount of roughly $45 million -- including $35 million offered to CenterPoint -- and is offered by a plan investor with a background in real estate development. The non-cash equity contribution consists of parcels of land offered by one of the Plan investors, Landmark America. The Plan bases its treatment of CenterPoint's liens on an estimated claim amount of $60,170,750. Under the Plan, the Debtor proposes to pay CenterPoint $35 million in cash immediately and pay the remaining amount of CenterPoint's allowed claim, which the Debtor values at $25 million, pursuant to a Plan Note. The Plan Note is to be secured by a parcel of real estate owned by the Debtor (the Olde Prairie Property) and the Parking Lease. It is not, notably, to be secured by the Debtor's Lakeside parcel. CenterPoint would thereby lose its present lien on the Lakeside Parcel. CenterPoint seeks dismissal of the Debtor's case, arguing that the Debtor cannot confirm its currently proposed Plan because of legal impediments on its face. CenterPoint identified four specific issues as legal defects in the latest Plan: 1. Whether the Plan deprived CenterPoint of its statutory right to credit-bid its claim in violation of 11 U.S.C. Sec. 1129(b)(2)(A)(ii). 2. Whether the Plan strips CenterPoint of the lien securing its claim in violation of 11 U.S.C. Sec. 1129(b)(2)(A)(i). 3. Whether the Plan provides CenterPoint with the "indubitable equivalent" of its secured claim under 11 U.S.C. Sec. 1129(b)(2)(A)(iii). 4. Whether the Plan provides for the impermissible release of guarantors of the Debtor's loan with CenterPoint. In his Dec. 22, 2011 memorandum opinion available at http://is.gd/FDl7Uzfrom Leagle.com, Judge Schmetterer said neither Landmark America nor Winners Development is related to the Debtor at this time. The judge said the proposal would thus be a transfer of ownership of rights in the Debtor and its assets to new owners of those rights in exchange for cash and property, a transaction normally defined as a sale. Title to the real estate held by the LLC would not change but control of the Debtor itself would be transferred to entirely new entities and CenterPoint would lose lien rights in one parcel. Since this would effectively constitute a sale, Judge Schmetterer said the Plan must provide CenterPoint with a right to credit bid its claim. About Olde Prairie Block Owner Olde Prairie Block Owner, LLC, owns two parcels of real estate: (a) a parcel known as the "Olde Prairie Property" located at 230 E. Cermak Road in Chicago, and (b) a parcel known as the "Lakeside Property" located across the street at 330 E. Cermak Road in Chicago. It also holds a long-term lease with the Metropolitan Pier and Exposition Authority that allows it rent-free use of 450 parking spaces at the McCormick Place parking garage until the year 2203. Olde Prairie Block Owner sought chapter 11 protection (Bankr. N.D. Ill. Case No. 10-22668) on May 18, 2010. The Debtor is represented by John Ruskusky, Esq., George R. Mesires, Esq., Nile N. Park, Esq., and Patrick F. Ross, Esq., at Ungaretti & Harris LLP, in Chicago. Wildman, Harrold, Allen & Dixon LLP, and Marcus, Clegg & Mistretta, P.A., serve as special counsels to the Debtor. The Debtor estimated assets at $100 million to $500 million and liabilities at $10 million to $50 million at the time of the filing. The Court previously found that the total value of the Real Properties and the Parking Lease was $81,150,000, far more than the $48,000,000 that CenterPoint claims to be owed by the Debtor. No trustee, examiner, or committee has been appointed in this case. PELICAN ISLES: Feb. 16 Combined Hearing on Plan Set --------------------------------------------------- U.S. Bankruptcy Court Judge Erik P. Kimball has conditionally approved the disclosure statement relating to the Chapter 11 Plan of Pelican Isles Limited Partnership. The consolidated hearing on final approval of the disclosure statement, confirmation of the Chapter 11 Plan and consideration of fee applications will be held on Feb. 16, 2012, at 1:30 p.m. The deadline for filing objections to confirmation as well as the deadline for filing objections to final approval of the disclosure statement is set for Feb. 13, 2012. Any creditor (other than a governmental unit) or equity security holder whose claim or interest is not scheduled or is scheduled as disputed, contingent, or unliquidated will file a proof of claim or interest on or before Jan. 12, 2012. Governmental units will file a proof of claim no later than 180 days after the date of the order for relief. As reported in the TCR on Dec. 6, 2011, Pelican Isles Limited Partnership submitted to the U.S. Bankruptcy Court for the Southern District of Florida a Disclosure Statement explaining the proposed Plan of Reorganization dated Nov. 11, 2011. The Plan provides for reinstatement of the mortgage loan held by CDT Mortgage, LLC, a Delaware limited liability company, pursuant to its original terms; a cure of all outstanding defaults to CDT in an amount to be determined by the Court, and payment of all other creditors in full, in the ordinary course of business. Holders of equity Interests will retain their interests in the Debtor. All leases for residential units at the Debtor's Apartment Complex will be assumed under the Plan. The Debtor will not be soliciting votes because all classes of creditors and interests are unimpaired and therefore are deemed to have accepted the Plan. A full-text copies of the Disclosure Statement is available for free at http://bankrupt.com/misc/PELICANISLES_DS.pdf About Pelican Isles Pelican Isles Limited Partnership, dba Pelican Isles Apartments and Pelican Isles owns and operates a 150-unit affordable rental community, built in 2005, which is located in Sebastian, Florida. The Apartment Complex provides tax-assisted low income housing to residents in the Sebastian, Florida area. The second real property owned by the Debtor is a parcel of undeveloped land, which is adjacent to the Apartment Complex. The Company filed for Chapter 11 protection (Bankr. S.D. Fla. Case No. 11-38544) on Oct. 14, 2011, estimating between $10 million and $50 million in assets and $1 million and $10 million in debts. Ronald G. Neiwirth, Esq., at Boyd & Jenerette, P.A, in Miami, Fla., serves as bankruptcy counsel. The petition was signed by John Corbett, President of The Partnership, Inc., the general partner of the Debtor. PENINSULA HOSPITAL: Proposes $8-Mil. DIP Loan from Revival Funding ------------------------------------------------------------------ Peninsula Hospital Center, et al., ask the U.S. Bankruptcy Court for the Eastern District of New York for authorization to: -- obtain postpetition financing from Revival Funding Co., LLC; -- utilize cash collateral; and -- granting security interests on a secured and super-priority basis. Pursuant to an agreement with Revival Acquisition Group LLC on Sept. 1, 2011, Revival agreed to provide an $8 million line of credit and financing to fund a plan of reorganization. The Debtors have determined that they are in need of postpetition financing in order to sustain operations and successfully emerge from Chapter 11. The Debtors relates that it has sufficient cash to fund operations only until Dec. 26. The terms of the financing includes: Lender: Revival Funding Co., LLC Credit Facility: A line of credit not to exceed $3,000,000 Use of Proceeds: Primarily for the financing the Debtors' day-to-day operations, including, without limitation, payroll expenses and outstanding postpetition creditor obligations. Availability: Advances will be available immediately upon entry of the Order authorizing the financing, and signing of the Credit and Security Agreement loan and related documents. Financial Terms: Prior to the occurrence of a repayment Event of Default, the outstanding principal balance of the Credit Agreement shall bear interest at the rate of 9% per annum. Upon the occurrence of an Event of Default, and for as long as the same will remain outstanding, at the option of Postpetition Lender, all obligations of borrower will bear interest at the rate of 14% per annum, which will be due as one lump sum payment. Collateral: All of Debtors' tangible and intangible assets and property will be collateral for all obligations incurred by the Debtors. Carve Out: Lender's security interests and liens on the Collateral will be subject and subordinate only to the following: (i) payment of United States Trustee's fees plus interest at the statutory rate for any fees not paid in a timely manner, and any fees payable to the Clerk of the Bankruptcy Court; (ii) fees and expenses of attorneys, accountants and other professionals retained in the Chapter 11 cases, to the extent allowed by the Bankruptcy Court, but in no event to exceed $200,000; and (iii) reasonable fees and expenses of a Chapter 7 trustee allowable in an amount not to exceed $15,000. Lien Priority: The Postpetition Lender is granted security interests and liens, subject only to the Carve Out and certain prior filed mortgages, security interests and liens other than those of the Benefit Funds with respect to PGN. Liens and security interests of the Benefit Funds in PGN are to be subordinated to the lien of the Postpetition Lender. Fees: An origination fee inclusive of lender's attorney's fees in the amount of $75,000. Objection The City of New York and its agencies, including but not limited to the New York City Water Board, objected to the Debtors' motion for DIP loan and cash collateral use. The Water Board, one of the Debtors' largest creditors, objected to any attempt to have it priming, statutory, liens on either subordinated to the liens of the DIP lender or any secured creditor, including J.P. Morgan Chase Bank, N.A. According to the City, the interim DIP motion is at best ambiguous if not carefully drafted to avoid and cloud issues relating to the carve out, the priorities of various secured creditors liens against each other and the liens the DIP lender is seeking to subordinate with respect to the Debtors' real property. The City of New York is represented by: Michael A. Cardozo, Esq., corporation counsel of the City of New York Gabriela P. Cacuci, Esq., assistant corporation counsel 100 Church Street, 5th Floor New york, NY 10007 Tel: (212) 788-0688 Fax: (212) 788-0937 E-mail: gcacuci@law.nyc.gov About Peninsula Hospital Wayne S. Dodakian, Vinod Sinha, and Shannon Gerardi filed an involuntary Chapter 11 bankruptcy protection against Peninsula Hospital Center -- http://www.peninsulahospital.org/-- (Bankr. E.D.N.Y. Case No. 11-47056) on Aug. 16, 2011. Judge Elizabeth S. Stong presides over the case. Marilyn Cowhey Macron, Esq., Macron & Cowhey, represents the petitioners. Peninsula Hospital Center and Peninsula General Nursing Home Corp., employed Alvarez & Marsal Healthcare Industry Group, LLC, as financial advisors. The Hospital employed Abrams Fensterman et al. as their attorneys. Nixon Peabody serves as their special counsel; GCG, Inc., serves as claims and noticing agent. Judge Stong appointed Daniel T. McMurray at Focus Management Group as patient care ombudsman. Neubert, Pepe & Monteith P.C. serves as PCO's counsel. CBIZ Accounting, Tax & Advisory of New York, LLC and CBIZ, Inc., serve as financial advisors for the Official Committee of Unsecured Creditors. PIEDMONT CENTER: KeySource Wants Lift Stay, Block of Cash Access ---------------------------------------------------------------- KeySource Commercial Bank, asks the U.S. Bankruptcy Court for the Eastern Distict of North Carolina for (i) relief from the automatic stay in Piedmont Center Investments, LLC's assets, and (ii) terminate the Chapter 11 Trustee's use of cash collateral. The Debtor is obligated to KeySource in the original principal amount of $3,800,000. The note is secured by a deed of trust and assignment of rents on commercial property located at 101-105 South 5th Street, Mebane, North Carolina. As of the petition Date, the Debtor owed KeySource the total amount of $4,101,586. KeySource seeks relief from the automatic stay to allow KeySource to pursue all rights and remedies available to it under its loan documents and applicable nonbankruptcy law, including but not limited to foreclosure or appointment of a receiver. KeySource asserts that interests of KeySource in the property and the rents generated thereon are not adequately protected. KeySource also stated that the relief is appropriate because the Debtor lacks equity in the property and the property is not necessary for an effective reorganization. About Piedmont Center Investments Raleigh, North Carolina-based Piedmont Center Investments, LLC, owns, leases, and manages seven shopping centers located in (i) Graham, Alamance County, North Carolina; (ii) Mebane, Alamance County, North Carolina; (iii) Pittsboro, Chatham County, North Carolina; (iv) Gibsonville, Guilford County, North Carolina; (v) Murfreesboro, Hertford County, North Carolina; (vi) Nashville, Nash County, North Carolina; and (vii) Roxboro, Person County, North Carolina. Manager and part-owner Roger Camp signed a Chapter 11 petition for Piedmont Center Investments, LLC (Bankr. E.D.N.C. Case No. 11-06178) on Aug. 11, 2011. Trawick H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., in New Bern, North Carolina, serves as counsel to the Debtor. In its schedules, the Debtor disclosed $27.2 million in assets and $15.5 million in liabilities. The Debtor's two primary secured creditors are Business Partners, LLC, and KeySource Commercial Bank. Counsel for KeySource are James B. Angell, Esq., and Nicolas C. Brown, Esq. -- jangell@hsfh.com and nbrown@hsfh.com -- at Howard, Stallings, From & Hutson, P.A. QUALTEQ INC: Venue Transfer Hearing Excludes Ad Hoc Panel's Gripe ----------------------------------------------------------------- The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware granted Bank of America, N.A.'s motion to strike the Ad Hoc Committee's objection to BofA's motion to transfer venue of the Chapter 11 cases of Qualteq, Inc. et al., to the Northern District of Illinois. The Court ordered that while the Ad Hoc Committee and the Ad Hoc members may listen to the hearing on the venue motion either by telephone or in person, they will not otherwise participate in hearing on the venue motion either individually or through counsel and may not submit any evidence in support of or make argument regarding the venue motion. About QualTeq Inc. South Plainfield, New Jersey-based QualTeq, Inc., engages in the design, manufacture, and personalization of plastic cards in the United States. The company manufactures magnetic, contact, and dual interface smart cards. Qualteq Inc. and 17 affiliated companies filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12572) on Aug. 14, 2011. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, serve as local counsel to the Debtors. K&L Gates LLP is the general bankruptcy counsel. Eisneramper LLP is the accountants and financial advisors. Scouler & Company is the restructuring advisors. Lowenstein Sandler PC is counsel to the Committee. Avadamma LLC disclosed $38,491,767 in assets and $36,190,943 in liabilities as of the Petition Date. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed four unsecured creditors to serve on the Official Committee of Unsecured Creditors. REGAL ENTERTAINMENT: M. Campbell Resigns as Executive Chairman -------------------------------------------------------------- Michael L. Campbell resigned from his position as Executive Chairman of Regal Entertainment Group, effective Dec. 28, 2011. Mr. Campbell will continue to serve as a member of the Board of Directors of the Company and will transition to a non-executive role as Chairman of the Board of the Company. In connection with his resignation, Mr. Campbell and the Company terminated that Amended and Restated Executive Employment Agreement, dated May 5, 2009, by and between the Company and Mr. Campbell, and entered into a Separation and General Release Agreement, dated Dec. 20, 2011. Under the Agreement, the Company will pay Mr. Campbell his base salary through Dec. 28, 2011, and his annual bonus for fiscal 2011 in the amount of $800,000. In exchange for his continuing service as Chairman of the Board, the Company will also pay Mr. Campbell a $100,000 annual cash retainer and make annual grants to him of restricted shares of Class A common stock of the Company having, at the time of grant, a fair market value of $200,000. In addition, Mr. Campbell's currently unvested equity awards, comprised of 122,916 unvested restricted shares and 169,682 unvested performance shares, will remain outstanding. Mr. Campbell will be considered in service for purposes of vesting in these equity awards as long as he continues to be a member of the Board. If Mr. Campbell's service on the Board terminates other than due to his voluntary resignation from the Board or his declining to be nominated for an additional term, then his unvested restricted shares will become fully vested and his unvested performance shares will remain outstanding and will vest to the extent that the as-adjusted EBITDA targets applicable to such performance shares are achieved. About Regal Entertainment Group Based in Knoxville, Tennessee, Regal Entertainment Group (NYSE: RGC) -- http://www.REGmovies.com/-- is the largest motion picture exhibitor in the world. Regal's theatre circuit, comprising Regal Cinemas, United Artists Theatres and Edwards Theatres, operates 6,739 screens in 545 locations in 38 states and the District of Columbia. Regal operates theatres in 43 of the top 50 U.S. designated market areas. The Company's balance sheet at Sept. 29, 2011, showed $2.26 billion in total assets, $2.81 billion in total liabilities and a $555.70 million total deficit. * * * Regal Entertainment carries 'B1' corporate family and probability of default ratings from Moody's Investors Service, 'B+' issuer default rating from Fitch Ratings, and 'B+' corporate credit rating from Standard & Poor's Ratings Services. Moody's said in February 2011 that Regal's B1 CFR reflects the trade-offs between the relative stability and the small magnitude of the company's cash flow stream. With no change expected in either parameter, and with very good liquidity, the rating outlook is stable. S&P said in February that the rating reflects S&P's view that the company's aggressive financial policies will likely cause leverage to remain elevated over the intermediate term. Furthermore, Regal's revenue and EBITDA trends are highly dependent on the performance of the U.S. box office. Other rating factors include the company's participation in the mature and highly competitive U.S. movie exhibition industry, exposure to the fluctuating popularity of Hollywood films, and the long-term risk of increased competition from the proliferation of entertainment alternatives. REDDY ICE: Common Stock to Suspend Trading on NYSE -------------------------------------------------- NYSE Regulation, Inc., announced that it determined that the common stock of Reddy Ice Holdings, Inc., - ticker symbol FRZ - should be suspended prior to the market opening on Thursday, Dec. 29, 2011, from the New York Stock Exchange. The Company expects to commence trading on the over-the-counter (OTC) market that same day under a symbol yet to be determined. NYSE Regulation has determined that the Company is no longer suitable for listing under Section 802.01B of the NYSE Listed Company Manual in view of the fact that it has fallen below the NYSE's continued listing standard regarding average global market capitalization over a consecutive 30 trading day period of less than $15 million, which is a minimum threshold for listing. The Company had previously fallen below the NYSE's continued listing standard for average global market capitalization over a consecutive 30 trading day period of less than $50 million and latest reported shareholders' equity of less than $50 million as well as the average closing price of less than $1.00 over a consecutive 30 trading day period. The Company's business plan was previously accepted by NYSE Regulation, however, in light of the subsequent non-compliance with the aforementioned minimum market capitalization standard, this plan process is no longer available. The Company has a right to a review of this determination by a Committee of the Board of Directors of NYSE Regulation. Application to the Securities and Exchange Commission to delist the issue is pending the completion of applicable procedures, including any appeal by the Company of the NYSE Regulation staff's decision. The NYSE noted that it may, at any time, suspend a security if it believes that continued dealings in the security on the NYSE are not advisable. About Reddy Ice Reddy Ice Holdings, Inc. is a manufacturer and distributor of packaged ice in the United States. With approximately 1,500 year- round employees, the Company sells its products primarily under the widely known Reddy Ice(R) brand to a variety of customers in 34 states and the District of Columbia. The Company provides a broad array of product offerings in the marketplace through traditional direct store delivery, warehouse programs and its proprietary technology, The Ice Factory(R). Reddy Ice serves most significant consumer packaged goods channels of distribution, as well as restaurants, special entertainment events, commercial users and the agricultural sector. The Company also reported a net loss of $36.15 million on $273.57 million of revenue for the nine months ended Sept. 30, 2011, compared with a net loss of $11.47 million on $260.20 million of revenue for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $460.94 million in total assets, $525.26 million in total liabilities and a $64.32 million total stockholders' deficit. * * * Reddy Ice carries 'B-' issuer credit ratings, with "negative" outlook, from Standard & Poor's. As reported by the TCR on Nov. 8, 2011, Moody's Investors Service lowered Reddy Ice Holdings, Inc.'s corporate family and probability-of-default ratings to Caa1 from B3, and its $12 million senior discount notes due 2012 to Caa3 from Caa2. Moody's also lowered the rating on Reddy Ice Corporation's $300 million first lien senior secured notes due 2015 to B3 from B2 and the $139 million second lien notes due 2015 to Caa3 from Caa2. The ratings outlook remains negative. The speculative grade liquidity rating was affirmed at SGL-3. The ratings downgrade reflects Moody's expectation that Reddy Ice's operating performance is unlikely to materially improve over the foreseeable future given the uncertain macro environment and the competitive nature of the U.S. packaged ice industry. RENASCENT INC: Plan Confirmation Hearing Continued Until Jan. 12 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Montana approved a stipulation continuing until Jan. 12, 2012, at 10:00 a.m., the hearing to consider confirmation of Renascent, Inc.'s Amended Plan of Reorganization. Objections, if any, are due Jan. 6. The Debtor and Bank of America N.A., as successor by merger to BAC Home Loan Servicing LP, fka Countrywide Home Loans Servicing, LP, Countywide Home Loans, Inc., ReconTrust Company, N.A., Thornburg Mortgage Securities Trust 2007-3 and Mortgage Electronic Registration Systems, Inc., filed on Dec. 1, 2011, a stipulation to continue the confirmation hearing and to grant final approval of the Disclosure Statement. As reported in the Troubled Company Reporter on Nov. 16, 2011, the Debtor's proposed plan contemplates a combination of: a. the development and sale of the Debtor's real estate (81 & 83 Bell Crossing); and b. continuing claims against the State of Montana and Ravalli County, continuing claims in Adversary #11-00045 against Countrywide Home Loans, Inc.; BAC Home Loans Servicing LP fka. Countrywide Home Loans, Servicing, LP; Thornburg Mortgage Securities Trust 2007-3; Recontrust Company NA; Mortgage Electronic Registration System, Inc. A copy of the Disclosure Statement dated Aug. 24, 2011, is available for free at http://bankrupt.com/misc/renascent.dkt159.pdf Objection Creditors Creative Finance & Investments, LLC Profit Sharing Plan, Craig & Rebecca L. DeSilva Trust, Ruth Havican, Donald Barth and Claudia Barth objected to the approval of the Disclosure Statement (which would allow the Debtor to move forward with the Plan solicitation and confirmation process) on these grounds: 1. the Plan fails to provide for repayment to secured creditors Barths and Havicans; 2. the Plan is not feasible; 3. the Plan does not propose to pay these creditors an amount equal to their secured claims; 4. the Disclosure Statement fails to properly disclose material information. Worden Thane, P.C., represents the creditors. About Renascent, Inc Victor, Montana-based Renascent, Inc., owned two large tracts of property in Ravalli County, Montana when it filed for Chapter 11 protection (Bankr. D. Mont. Case No. 10-62358) on Sept. 29, 2010. This property was sold in two sales for $2.5 million on July 14, 2001. In addition, there is a 170 acre parcel of land consisting of 2 tracts of contiguous land near Stevensville, Montana (83 Bell Crossing and 81 Bell Crossing). Jon R. Binney, Esq., who has an office in Missoula, Montana, represents the Debtor. David Markette, Esq., and Dustin Chouinard, at Markette & Chouinard, serve as the Debtor's special counsel. There was no official committee appointed in the Debtor's case. The Company disclosed $13,131,199 in assets and $7,278,420 in liabilities as of the Chapter 11 filing. In a court-approved stipulation, Renascent, Inc. and the Office of the United States Trustee agreed to appoint Ross P. Richardson as special litigation master. ROOMSTORE INC: Hires Lowenstein Sandler as Bankruptcy Counsel ------------------------------------------------------------- RoomStore, Inc., asks the Bankruptcy Court to approve its engagement of Lowenstein Sandler PC as counsel for the Debtor. Lowenstein was first retained to represent the Debtor in connection with a potential restructuring or chapter 11 filing in October 2011. Prior to the Petition Date, Lowenstein received a retainer of $575,000: $75,000 was received by Lowenstein on Nov. 7, 2011, $50,000 on Dec. 1, 2011, and $450,000 on Dec. 9, 2011. The amount has been applied to prepetition services rendered and expenses incurred by Lowenstein. The balance, totaling $202,259, will be utilized as a retainer for post-petition fees and expenses. Lowenstein also previously represented the Debtor in certain matters. In 2011, Lowenstein performed certain other services for the Debtor and issued an invoice dated Aug. 24, 2011, of $2,142, for which payment was received by Lowenstein on Sept. 24, 2011. Lowenstein's current hourly rates are: Members (principals) $435 - $895 Senior Counsel (generally 10 or more years experience) $390 - $660 Counsel $350 - $630 Associates (generally less than 6 years experience) $250 - $470 Paralegals and Assistants $145 - $245 Lowenstein's Bruce D. Buechler, Esq., attests that the firm has not represented the Debtor, its creditors or any other parties in interest, or their attorneys, in any matter relating to the Debtor or its estate; does not hold or represent any interest adverse to the Debtor's estate; and is a "disinterested person" as that phrase is defined in section 101(14) of the Bankruptcy Code. About RoomStore Richmond, Virginia-based RoomStore, Inc., operates a chain of 64 retail furniture stores, including both large-format stores and clearance centers in eight states: Pennsylvania, Maryland, Virginia, North Carolina, South Carolina, Florida, Alabama, and Texas. It also has five warehouses and distribution centers located in Maryland, North Carolina, and Texas that service the Retail Stores. The Company also offers its home furnishings through Furniture.com, a provider of internet-based sales opportunities for regional furniture retailers. The Company owns 65% of Mattress Discounters Group LLC, which operates 83 mattress stores (as of Aug. 31, 2011) in the states of Delaware, Maryland and Virginia and in the District of Columbia. RoomStore was founded in 1992 in Dallas, Texas, with four retail furniture stores. With more than $300 million in net sales for its fiscal year ending 2010, RoomStore is one of the 30 largest furniture retailers in the United States. RoomStore filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case No. 11-37790) on Dec. 12, 2011, following store-closing sales at four of its retail stores, located in Hoover, Alabama; Fayetteville, North Carolina; Tallahassee, Florida; and Baltimore, Maryland. Judge Douglas O. Tice, Jr., presides over the case. Lawyers at Lowenstein Sandler PC and Kaplan & Frank, PLC serve as the Debtor's bankruptcy counsel. Julius M. Feinblum Real Estate Inc., serves as its real estate consultant. The Company's balance sheet at Aug. 31, 2011, showed $70.4 million in total assets, $60.3 million in total liabilities, and stockholders' equity of $10.1 million. The petition was signed by Stephen Girodano, president and chief executive officer. Liquidator Hilco Merchant Resources, Inc., is represented in the case by Gregg M. Galardi, Esq., at DLA Piper LLP (US); and Robert S. Westermann, Esq., and Sheila deLa Cruz, Esq., at Hirschler Fleischer, P.C. The U.S. Trustee for Region 4 named seven members to the official committee of unsecured creditors in the case. ROOMSTORE INC: Hires Feinblum as Real Estate Consultant ------------------------------------------------------- RoomStore Inc. seeks Bankruptcy Court permission to employ Julius M. Feinblum Real Estate, Inc., as its real estate consultant. Feinblum will analyze the Debtor's store and warehouse leases and locations and assist in obtaining lease concessions concerning the Debtor's real estate. The compensation structure to Feinblum is outlined in the parties' Engagement Letter dated Dec. 9, 2011, which provides that: (a) If a lease is surrendered to a landlord or a lease is assumed and assigned to a third party, Feinblum will be paid a fee of 4% of the gross amount paid to RoomStore. (b) In the event that Feinblum obtains any rent reductions from a landlord for a location, Feinblum shall be entitled to a fee of 4% of the gross value of said rent reductions by RoomStore. (c) In the event of a sale of any fee owned properties by RoomStore, RoomStore shall pay Feinblum a 4% sales commission if Feinblum is both the listing and selling broker. If Feinblum is solely the agent in connection with a sale of a fee owned property, Feinblum shall be paid a fee of 3%. (d) All fees to be paid to Feinblum by RoomStore pursuant to this schedule shall be paid at the time the particular transaction is consummated. (e) Feinblum shall be reimbursed for marketing expenses on properties being disposed. These marketing expenses include signage, blitz email marketing and a website dedicated to the project. The total budget for expenses shall not exceed $25,000 for the project. Expenses must be verified with actual sign cost receipts and approved by RoomStore. Julius M. Feinblum attests that the firm has no connection with the Debtor, its creditors, the Office of the United States Trustee or any other party in interest in the chapter 11 case or its attorneys or other professionals; neither holds nor represents any interest adverse to the Debtor or its estate in matters for which it is proposed to be retained; and is a "disinterested person," as defined in Section 101(14) of the Bankruptcy Code. The firm may be reached at: JULIUS M. FEINBLUM REAL ESTATE, INC. 25 Fairchild Avenue, Suite 500 Plainview, NY 11803 E-mail: info@furniturerealestate.com jmfrealty@aol.com About RoomStore Richmond, Virginia-based RoomStore, Inc., operates a chain of 64 retail furniture stores, including both large-format stores and clearance centers in eight states: Pennsylvania, Maryland, Virginia, North Carolina, South Carolina, Florida, Alabama, and Texas. It also has five warehouses and distribution centers located in Maryland, North Carolina, and Texas that service the Retail Stores. The Company also offers its home furnishings through Furniture.com, a provider of internet-based sales opportunities for regional furniture retailers. The Company owns 65% of Mattress Discounters Group LLC, which operates 83 mattress stores (as of Aug. 31, 2011) in the states of Delaware, Maryland and Virginia and in the District of Columbia. RoomStore was founded in 1992 in Dallas, Texas, with four retail furniture stores. With more than $300 million in net sales for its fiscal year ending 2010, RoomStore is one of the 30 largest furniture retailers in the United States. RoomStore filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case No. 11-37790) on Dec. 12, 2011, following store-closing sales at four of its retail stores, located in Hoover, Alabama; Fayetteville, North Carolina; Tallahassee, Florida; and Baltimore, Maryland. Judge Douglas O. Tice, Jr., presides over the case. Lawyers at Lowenstein Sandler PC and Kaplan & Frank, PLC serve as the Debtor's bankruptcy counsel. The Company's balance sheet at Aug. 31, 2011, showed $70.4 million in total assets, $60.3 million in total liabilities, and stockholders' equity of $10.1 million. The petition was signed by Stephen Girodano, president and chief executive officer. Liquidator Hilco Merchant Resources, Inc., is represented in the case by Gregg M. Galardi, Esq., at DLA Piper LLP (US); and Robert S. Westermann, Esq., and Sheila deLa Cruz, Esq., at Hirschler Fleischer, P.C. The U.S. Trustee for Region 4 named seven members to the official committee of unsecured creditors in the case. ROOMSTORE INC: Assumes Amended Contract With Hilco -------------------------------------------------- The Bankruptcy Court signed off on a stipulation permitting RoomStore Inc. to assume an amended letter agreement with Hilco Merchant Resources, Inc., which is supervising store-closing liquidation sales at certain of the Debtor's retail store locations. The Debtor and Hilco entered into a Letter Agreement Governing High Impact Sale and Store Closing Event Sales on June 3, 2011. The parties on Aug. 31, 2011, entered into an Amendment to Letter Agreement, to modify the terms of the Letter Agreement, including extending the Conclusion Date as defined in the Letter Agreement to no later than Jan. 29, 2012. Hilco is currently supervising the liquidation of two of the Debtor's retail stores at which store-closing sales commenced prior to the Petition Date, and the Debtor desires to have Hilco complete rendering services at these two locations pursuant to the Amended Letter Agreement, provided that Hilco agrees to further modify the "Conclusion Date". The Stipulation and Agreed Order provides that the Conclusion Date of the Amended Letter Agreement is extended to Dec. 31, 2011, and the Debtor will not incur administrative rent expense for the Liquidating Stores for the month of January 2012. About RoomStore Richmond, Virginia-based RoomStore, Inc., operates a chain of 64 retail furniture stores, including both large-format stores and clearance centers in eight states: Pennsylvania, Maryland, Virginia, North Carolina, South Carolina, Florida, Alabama, and Texas. It also has five warehouses and distribution centers located in Maryland, North Carolina, and Texas that service the Retail Stores. The Company also offers its home furnishings through Furniture.com, a provider of internet-based sales opportunities for regional furniture retailers. The Company owns 65% of Mattress Discounters Group LLC, which operates 83 mattress stores (as of Aug. 31, 2011) in the states of Delaware, Maryland and Virginia and in the District of Columbia. RoomStore was founded in 1992 in Dallas, Texas, with four retail furniture stores. With more than $300 million in net sales for its fiscal year ending 2010, RoomStore is one of the 30 largest furniture retailers in the United States. RoomStore filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case No. 11-37790) on Dec. 12, 2011, following store-closing sales at four of its retail stores, located in Hoover, Alabama; Fayetteville, North Carolina; Tallahassee, Florida; and Baltimore, Maryland. Judge Douglas O. Tice, Jr., presides over the case. Lawyers at Lowenstein Sandler PC and Kaplan & Frank, PLC serve as the Debtor's bankruptcy counsel. Julius M. Feinblum Real Estate Inc., serves as its real estate consultant. The Company's balance sheet at Aug. 31, 2011, showed $70.4 million in total assets, $60.3 million in total liabilities, and stockholders' equity of $10.1 million. The petition was signed by Stephen Girodano, president and chief executive officer. The U.S. Trustee for Region 4 named seven members to the official committee of unsecured creditors in the case. Liquidator Hilco Merchant Resources, Inc., is represented in the case by: Gregg M. Galardi, Esq. DLA PIPER LLP (US) 1251 Avenue of the Americas New York, NY 10020 Tel: (212) 335-4640 E-mail: gregg.galardi@dlapiper.com - and - Robert S. Westermann, Esq. Sheila deLa Cruz, Esq. HIRSCHLER FLEISCHER, P.C. The EdgeworthBuilding 2100 East Cary Street Richmond, VA 23223 Tel: (804) 771-9500 Fax: (804) 644-0957 E-mail: rwestermann@hf-law.com sdelacruz@hf-law.com SEARS HOLDINGS: To Close 120 Stores in Turnaround Plan ------------------------------------------------------ Sears Holdings Corporation on Tuesday unveiled cost reduction plans that include closing 100 to 120 Kmart and Sears Full-line stores. "Given our performance and the difficult economic environment, especially for big-ticket items, we intend to implement a series of actions to reduce on-going expenses, adjust our asset base, and accelerate the transformation of our business model. These actions will better enable us to focus our investments on serving our customers and members through integrated retail -- at the store, online and in the home," said Chief Executive Officer Lou D'Ambrosio. Specific actions which Sears plans to take include: * Close 100 to 120 Kmart and Sears Full-line stores. Sears expects these store closures to generate $140 million to $170 million of cash as the net inventory in these stores is sold and Sears expects to generate additional cash proceeds from the sale or sublease of the related real estate. Further, Sears intends to optimize the space allocation based on category performance in certain stores. Final determination of the stores to be closed has not yet been made. The list of stores closing will be posted at http://www.searsmedia.com/when final determination is made. * Excluding the effect of store closures, Sears currently expects to reduce 2012 peak domestic inventory by $300 million from the 2011 level of $10.2 billion at the end of the third quarter as a result of cost decreases in apparel, tighter buys and a lower inventory position at the beginning of the fiscal year. * Focus on improving gross profit dollars through better inventory management and more targeted pricing and promotion. * Reduce fixed costs by $100 million to $200 million. In addition to the specific store closures, Sears will carefully evaluate store performance going forward and act opportunistically to recognize value from poor performing stores as circumstances allow. While past practice has been to keep marginally performing stores open while Sears worked to improve performance, Sears no longer believes that to be the appropriate action in this environment. Sears intends to accentuate focus and resources to better performing stores with the goal of converting their customer experience into a world-class integrated retail experience. Sears currently expects the store closure and inventory reduction actions to reduce peak inventory in 2012 by $500 million to $580 million and reduce peak borrowing need by $300 million to $350 million in 2012 from levels that may have resulted in 2012 without such actions. At Dec. 23, Sears had $483 million of borrowings outstanding on domestic revolving credit facility leaving Sears with over $2.9 billion of availability on revolving credit facilities ($2.1 billion on domestic facility and $800 million on Canadian facility). There were no borrowings outstanding last year at this time. During the fourth quarter through Dec. 23, 2011, Sears has not repurchased any common shares under its share repurchase program. As of Dec. 23, 2011, Sears had remaining authorization to repurchase $524 million of common shares under the previously approved programs. The company currently plans to release financial results for its fiscal 2011 fourth quarter and full year on or about Feb. 23, 2012, before the market opens. Sears said comparable store sales for the eight-week and year-to-date periods ended Dec. 25, 2011 for its Kmart and Sears stores are: QTD YTD --- --- Kmart -4.4% -1.8% Sears Domestic -6.0% -3.3% Total -5.2% -2.6% Kmart's quarter-to-date comparable store sales decline reflects decreases in the consumer electronics and apparel categories and lower layaway sales. Sears Domestic's quarter-to-date sales decline was primarily driven by the consumer electronics and home appliance categories, with more than half of the decline in Sears Domestic occurring in consumer electronics. Sears apparel sales were flat and Lands' End in Sears stores was up mid-single digits. The combination of lower sales and continued margin pressure coupled with expense increases has led to a decline in Sears' Adjusted EBITDA. Accordingly, Sears expects fourth quarter consolidated Adjusted EBITDA will be less than half of last year's amount. For reference, last year Sears generated $933 million of Adjusted EBITDA in the fourth quarter ($795 million domestically and $138 million in Canada). Due to performance in 2011, Sears expects to record in the fourth quarter a non-cash charge related to a valuation allowance on certain deferred tax assets of $1.6 billion to $1.8 billion. Although a valuation adjustment is recognized on these deferred tax assets, no economic loss has occurred as the underlying net operating loss carryforwards and other tax benefits remain available to reduce future taxes to the extent income is generated. Further, Sears may recognize in the fourth quarter an impairment charge on some goodwill balances for as much as $600 million. These charges would be non-cash and combined are estimated to be between $1.6 billion and $2.4 billion. About Sears & Kmart Hoffman Estates, Illinois-based Sears Holdings Corporation (Nasdaq: SHLD) -- http://www.searsholdings.com/-- is the nation's fourth largest broadline retailer with more than 4,000 full-line and specialty retail stores in the United States and Canada. Sears Holdings operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a 94% stake in Sears Canada and an 80.1% stake in Orchard Supply Hardware. Key proprietary brands include Kenmore, Craftsman and DieHard, and a broad apparel offering, including such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer, as well as the Apostrophe and Covington brands. It also has the Country Living collection, which is offered by Sears and Kmart. In December 2011, Moody's Investors Service lowered Sears Holdings Corporate Family and Probability of Default Ratings to B1 from Ba3. Moody's said the The downgrade reflects persistent negative trends in revenues and operating margins of Sears Holdings, and the weaker than anticipated performance in its third quarter earnings. The B1 rating takes into consideration the company's good liquidity position, which reflects its access to sizable asset based revolving credit facilities and its strong sources of alternative liquidity due to its holdings of unencumbered real estate. Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6, 2003, pursuant to the terms of an Amended Joint Plan of Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represented the retailer in its restructuring efforts. The Company's balance sheet showed $16,287,000,000 in assets and $10,348,000,000 in debts when it sought chapter 11 protection. Kmart bought Sears, Roebuck & Co., for $11 billion to create the third-largest U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in annual revenues. Kmart completed its merger with Sears on March 24, 2005. SHINER CHEMICALS: Asks Court to Dismiss Involuntary Ch. 11 Case --------------------------------------------------------------- Shiner Chemicals, LLC, asks the U.S. Bankruptcy Court for the District of Arizona to dismiss the involuntary Chapter 11 petition filed against it by Petitioners Aaron J. Valenzuela, Sherri S. Parkin and Peter J. Workum who claim to be creditors of the Debtor. The Debtor contends there is a bona fide dispute as to liability regarding Valenzuela and Parkin's claims. The Debtor admits borrowing from Workum, but raises a bona fide dispute as to the claim amount, and terms of repayment. The Debtors further contends that Petitioners' claims were brought in bad faith, and thus Debtor seeks its reasonable attorney's fees and punitive damages. About Shiner Chemicals Aaron J. Valenzuela, Sherri S. Parkin and Peter J. Workman filed an involuntary Chapter 11 petition against Shiner Chemicals, LLC (Bankr. D. Ariz. Case No. 11-27955) on Oct. 3, 2011. Judge George B. Nielsen, Jr., presides over the case. Chad B. Kennedy and Orlo D. Ison are the sole members of the Debtor. James M. McGuire, Esq., at Davis Miles, PPLC, represents the Debtor as counsel. SHINER WAREHOUSE: Asks Court to Dismiss Involuntary Ch. 11 Case --------------------------------------------------------------- Shiner Warehouse, LLC, asks the U.S. Bankruptcy Court for the District of Arizona to dismiss the involuntary Chapter 11 petition filed against it by petitioners Aaron J. Valenzuela, Sherri S. Parkin and Peter J. Workum who claim to be creditors of the Debtor. The Debtor contends there is a bona fide dispute as to liability regarding Valenzuela and Parkin's claims. The Debtor admits borrowing from Workum, but raises a bona fide dispute as to the claim amount, and terms of repayment. The Debtor further contends that Petitioners' claims were brought in bad faith, and thus the Debtor seeks its reasonable attorney's fees and punitive damages. About Shiner Warehouse Aaron J. Valenzuela, Sherri S. Parkin and Peter J. Workman filed an involuntary Chapter 11 petition against Shiner Warehouse, LLC (Bankr. D. Ariz. Case No. 11-28103) on Oct. 4, 2011. Judge Sarah Sharer Curley presides over the case. Orlo D. Ison is the sole member of the Debtor. JamesM. McGuire, Esq., at Davis Miles, PPLC, represents the Debtor as counsel. STANADYNE HOLDINGS: Inks Third Amendment to Wells Fargo Facility ---------------------------------------------------------------- In order to enhance Stanadyne Corporation's liquidity position, on Dec. 16, 2011, Stanadyne and Wells Fargo Capital Finance, LLC, entered into a Third Amendment to Credit Agreement and a Fourth Amendment to EXIM Guarantied Credit Agreement. The Third Credit Amendment increased the maximum revolver amount from $35 million to $55.8 million by adding a Maximum Guaranteed Revolver Amount as defined by the Credit Agreement of $20.8 million. The investment funds which are managed by Kohlberg Management IV, L.L.C., that are the primary equity holders of Stanadyne Holdings, Inc., are the guarantors of the Guaranteed Amount. Borrowing under the Guaranteed Amount is limited to $0.5 million increments, with a minimum of $2.5 million. The Third Credit Amendment also established interest rates for the Guaranteed Amount and detailed the order in which payments are applied to outstanding balances under the various credit facilities. Lastly, the Third Credit Amendment changed the expiration of the Credit Agreement to April 30, 2014, from Aug. 13, 2014. The purpose of the Fourth EXIM Amendment was to incorporate the Guaranteed Advances added by the Third Credit Amendment into the agreement. All other terms of the credit agreements were materially unchanged from the prior agreements. In connection with the prior amendments to the credit agreements reported on the Current Report on Form 8-K dated Sept. 26, 2011, and filed Sept. 28, 2011, on Dec. 16, 2011, Stanadyne entered into a new Export-Import Bank of the United States Working Capital Guarantee Program Borrower Agreement to reflect the changes in the prior amendments to the credit agreements, including an increase in the "Maximum Revolver Amount" under the EXIM Guarantied Credit Agreement that is guaranteed by the Export-Import Bank from $10 million to $15 million. Except to reflect such changes, the New EXIM Agreement is materially unchanged from the prior agreement, including the expiration date of Aug. 31, 2013. About Stanadyne Holdings Stanadyne Corporation, headquartered in Windsor, Connecticut, is a designer and manufacturer of highly-engineered precision- manufactured engine components, including fuel injection equipment for diesel engines. Stanadyne sells engine components to original equipment manufacturers and the aftermarket in a variety of applications, including agricultural and construction vehicles and equipment, industrial products, automobiles, light duty trucks and marine equipment. Revenues for LTM ended Sept. 30, 2010 were $240 million. The Company also reported a net loss of $7.79 million on $185.49 million of net sales for the nine months ended Sept. 30, 2011, compared with a net loss of $4.85 million on $188.09 million of net sales for the same period a year ago. The Company's balance sheet at Sept. 30, 2011, showed $374.24 million in total assets, $379.07 million in total liabilities, $794,000 in redeemable non-controlling interest, and a $5.62 million in total stockholders' deficit. * * * As reported by the TCR on Jan. 21, 2011, Moody's Investors Service confirmed Stanadyne Holdings, Inc.'s Caa1 Corporate Family Rating and revised the rating outlook to stable. The CFR confirmation reflects the remediation of the Stanadyne's previous inability to file financial statements in accordance with financial reporting requirements contained in its debt agreements and expectations for modest continued improvement in operating performance. Improved operations, largely the result of positive momentum in key end markets and restructuring activities, have allowed Stanadyne to maintain positive funds from operations despite increased cash interest expense. The company's $100 million 12% senior discount notes began paying cash interest in February 2010. STOCKDALE TOWER: Seeks to Employ CB Richard as Real Estate Broker ----------------------------------------------------------------- Stockdale Tower 1, LLC, asks the U.S. Bankruptcy Court for the Eastern District of California for permission to employ CB Richard Ellis as its real estate broker to represent the Debtor in marketing, selling and/or leasing the real property. Based on the terms of the Exclusive Leasing Listing Agreement and Amendment to Listing Agreement, CBRE will receive a commission on the sale of the real property in the amount of a 5% of the gross selling price if it represents both the buyer and the Debtor. Any compensation paid to CBRE will be paid directly from escrow from proceeds received from the sale of the real property and will be subject to approval of the Court. CBRE has not received a ret ainer from Debtor or any other person. If the property is sold to buyers not represented by CBRE, the Debtor contemplates that CBRE would be entitled to receive a commission of up to 2.5% of the gross selling price for services rendered in representing the estate in marketing the property. The broker, representing such buyer, would be entitled to receive a commission of up to 2.5% of the accepted and consummated price. The estate will not be liable for more than the total 5% for commissions. The commissions will be payable only to the brokers involved in the accepted and consummated sale. CBRE will receive a commission on the lease of real property summarized as: a. Gross Leases - where landlord pays all or base year portion ii. Term of Lease Than 5 Years 6% of total base rental for the first 24 months in which rent is to be paid, plus 5% of the total base rental for the next 12 months in which rent is to be paid, plus 4% of the total base rental for the remainder of the term. iii. Term of Lease 5 Through 25 years 5% of the total base rental for the first 60 months in which rent is to be paid, plus 2-1/2% of the total base rental for the next 60 months which rent is to be paid, plus 1-1/2% of the total base rental for the remainder of the term. b. Net Leases - where tenant pays all real estate taxes ii. Term of Lease Less Than 5 Years 7% of total base rental for the first 24 months in which rent is to be paid, plus 6% of the total base rental for the next 12 months in which rent is to be paid, plus 5% of the total base rental for the remainder of the term. iii. Term of Lease 5 Through 25 Years 6% of the total base rental for the first 60 months in which rent is to be paid, plus 3-1/2% of the total base rental for the next 60 months in which rent is to be paid, plus 2-1/2% of the total base rental for the remainder of the term. If a lease term is in excess of 25 years then the commission shall be calculated upon only the base rental to be paid for the first 25 year of the lease term. The Debtor assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Stockdale Tower Bakersfield, California-based Stockdale Tower 1, LLC, filed for Chapter 11 bankruptcy (Bankr. E.D. Calif. Case No. 11-62167) on Nov. 7, 2011. Judge W. Richard Lee presides over the case. Scott T. Belden, Esq., and Jacob L. Eaton, Esq., of Klein, DeNatale, Goldner, Cooper, Rosenlieb & Kimball, LLP, serve as the Debtor's bankruptcy counsel. The Debtor disclosed $17,880,755 in assets and $17,870,212 in liabilities as of the Chapter 11 filing. SUMMO INC: Asks Court to Approve "Lift Stay" with Frontier Bank --------------------------------------------------------------- Summo, Inc., and Frontier Bank, a Branch of First National Bank in Lamar, jointly asks the U.S. Bankruptcy Court for the District of Colorado to approve a Settlement Agreement entered into by the parties to avoid the cost, delay and uncertainty of litigation. As of Sept. 23, 2011, the Bank is owed a total of $5,791,663 plus costs, expenses, appraiser fees and attorney fees under two Notes which matured on May 10, 2010. On Oct. 19, 2011, the Bank filed its Motion For Relief From Stay seeking to have the bankruptcy stay modified to permit the Bank to foreclose its second lien on the real property of the Debtor located in the County of Pueblo, State of Colorado, at the Foreclosure Sale. The Lift Stay Agreement provides: a. The Bank will be granted relief from stay effective at 5:00 p.m. on March 8, 2012, for the purpose of foreclosing its Note Two Deed of Trust encumbering the Property at the next regularly continued Foreclosure Sale date. b. Upon entry of an order by the Bankruptcy court approving the Lift Stay Agreement, the Bank will withdraw the Lift Stay Motion and the Motion to Dismiss. c. On or before 5:00 p.m. on March 8, 2012, the Bank will accept payment from Summo in the amount of $5,000,000 in full satisfaction of all amounts due under Note 1 and Note 2. To effect the Discounted Payment, Summo must wire the sum of $5,000,000 to the Bank so that it is received by the Bank on or before 5:00 p.m. on March 8, 2012. d. Summo and Mr. Musso are releasing any claims that they may hold against the Bank; and the Bank is releasing any claims it may hold against Summo and Mr. Musso, including but not limited to claims arising under Note One, Note Two and the Guarantee of John C. Musso, the president and sole equity owner of the Debtor. e. the Lift Stay Agreement is subject to the entry of an order by the Bankruptcy court approving the Lift Stay Agreement. About Summo Inc. Pueblo, Colorado-based Summo, Inc., fka Pinion Ridge, LLC, filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 11-28971) on Aug. 9, 2011. Judge Elizabeth E. Brown presides over the case. Daniel K. Usiak, Jr., Esq., at Usiak Law Firm, in Colorado Springs, Colo., serves as the Debtor's bankruptcy counsel. The Debtor scheduled $15,845,500 in assets and $4,809,760 in debts. The petition was signed by John C. Musso, the president and sole equity owner of the Debtor. A creditors committee has not been appointed in the bankruptcy case. WASHINGTON MUTUAL: Dime Litigation Reps Now Included in Mediation ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware amended an order appointing mediator to allow the participation of the Class Representatives of Dime Litigation Tracking warrant Holder in the mediation in relation to the cases of Washington Mutual, Inc., et al. The Court originally entered an order appointing mediator on Oct. 11, 2011. Pursuant to the amended order, the scope of the mediation will include the resolution of the causes of action asserted in the litigation styled, Nantahala Capital Partners, LP, et al., v. Washington Mutual Inc., et al., Adv. proc. No. 10-50911, pending in the Court. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- was the 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 Bankruptcy Court entered a 107-page opinion determining that the global settlement agreement, among certain parties including WMI, the Federal Deposit Insurance Corporation and JPMorgan, upon which the Plan is premised, and the transactions contemplated therein, are fair, reasonable, and in the best interests of WMI. However, 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. WaMu filed a Modified Sixth Amended Joint Plan and a related Supplemental Disclosure Statement, which it believes would address the Bankruptcy Court's concerns. On Sept. 13, 2011, Judge Walrath denied confirmation of WaMu's Modified Sixth Amended Plan and granted equity committee standing to prosecute claims for equitable disallowance but stayed the ruling pending mediation. WaMu said it would seek confirmation of a revised plan "as soon as practicable." The Plan proposes to pay more than $7 billion to creditors and incorporates a global settlement agreement resolving issues among the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp. in its corporate capacity and as receiver for WaMu Bank, certain large creditors, certain WMB senior noteholders, and the creditors' committee. The Settlement Noteholders are Appaloosa Management, L.P., Aurelius Capital Management LP, Centerbridge Partners, LP, and Owl Creek Asset Management, L.P. WAVERLY GARDENS: Bankruptcy Court Clerk Order to Close Ch. 11 Case ------------------------------------------------------------------ The Hon. Paulette J. Delk of the U.S. Bankruptcy Court for the Western District of Tennessee authorized the Court Clerk to administratively close the Chapter 11 case of Waverly Gardens of Memphis, LLC. According to the Debtor's case docket, the case was dismissed on Oct. 20, 2011 About Waverly Gardens of Memphis Memphis, Tennessee-based Waverly Gardens of Memphis, LLC and Kirby Oaks Integra, LLC -- http://www.waverlygardens.com/-- operate two senior living facilities consisting of a total of 248 units. Waverly Gardens consists of 196 rental units and is located at 6539 Knight Arnold Road, Memphis, Tennessee 38115. Kirby Oaks consists of 52 rental units and is located at 6551 Knight Arnold Road, Memphis, Tennessee 38115. The Debtors filed separate petitions for Chapter 11 relief on Oct. 2, 2008 (Bankr. W.D. Tenn. Lead Case No. 08-30218). Michael P. Coury, Esq., and Robert Campbell Hillyer, Esq., at Butler, Snow, O'Mara, Stevens & Cannada, represent the Debtors as counsel. Waverly Gardens estimated assets at $10 million to $50 million, and debts at $1 million to $10 million. Kirby Oaks estimated assets and debts at $1 million and $10 million. WEST END: 2nd Amended Plan Provides for Liquidation of Assets ------------------------------------------------------------- West End Financial Advisors LLC, filed with the U.S. Bankruptcy Court for the Southern District of New York a Disclosure Statement explaining the Second Amended Plan of Liquidation. The Debtor will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the Plan seeks to liquidate the Debtor in order to provide fair, equitable, and reasonable treatment to all creditors of the Debtor. Under the Plan all of the Debtor's assets will be transferred to a grantor trust which will be administered by the Plan Administrator. The Plan Administrator will collect the Debtor's income and monetize its assets over the existence of the Post-Confirmation Estate and pay creditors in accordance with the terms of the Plan. The creditor distributions will be funded from the Plan Administrator's cash on hand, the Budget Funds, monetization of the Post-Confirmation Estate Assets, the Post-Confirmation WEMFF/WEFIP Funds recoveries, if any, from the pursuit of alleged preference and fraudulent conveyance claims and pursuit of other claims held by the estate against third parties. The decision of the Plan Administrator to sell the interests in the "Hard Money Fund" or the "Franchise Fund" may only be done with approval of a majority of the Plan Oversight Committee, and, if proposed prior to satisfaction of the New Northlight Note, if the proceeds from the sale are sufficient to satisfy the New Northlight Note. The Debtor projects that the Holders of Claims in Classes 1, 2 and 3 will be paid in full under the terms of the Plan. The Debtor is unable to set forth with numerical specificity the estimated distributions to Class 4 Claim Holders. The reasons for this is the Debtors do not know at this point in time whether the Plan Administrator will seek to sell the estate's interests in the Hard Money Fund and the Franchise Fund prior to the maturity of the loans contained in those portfolios, and if the Debtor's interests are sold, what discount, if any, might be agreed to by the Plan Administrator and the purchaser of the portfolio. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/WEST_END_ds_secondamended.pdf As reported in the Troubled Company Reporter on Dec. 7, 2011, West End Financial received approval from the bankruptcy judge for the disclosure statement explaining the liquidating Chapter 11 plan. The confirmation hearing for approval of the plan is set for Jan. 26. About West End Financial West End Financial Advisors LLC, Sentinel Investment Management Corp. and a number of affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-11152) in Manhattan on March 15, 2011. New York-based West End estimated its assets and debts at $1 million to $10 million. Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as the Debtors' bankruptcy counsel. William Landberg created WEFA in 2000 as an investment and financial management company. Subsequently he purchased Sentinel Investment Management Corp., a boutique investment advisory company. Sentinel and WEFA targeted individual private clients for investments in fixed income funds and alternative investment products. Mr. Landberg's ultimately resigned from all West End related entities effective June 2, 2009, following a probe on misappropriation of funds. Schedules of assets and liabilities for West End and its funds showed assets of $400,000 and debt of $6.7 million, not including $66 million from investors who may or may not be considered creditors. Debt includes $5.5 million in secured claims, according to the schedules. Secured creditors with the largest claims are DZ Bank ($118.1 million), West LB ($41 million), Iberia Bank ($11.3 million), and Suffolk County National Bank ($8.3 million). West End Financial filed a plan of liquidation in bankruptcy court in August. WILLIAM LYON: Wins Court Okay to Tap $15MM From Colony DIP Loan --------------------------------------------------------------- William Lyon Homes Inc. and its debtor-affiliates won interim authority from the Bankruptcy Court to immediately dip their hands into $15 million of the $30 million in postpetition secured financing arranged by ColFin WLH Funding Inc., as administrative agent for the DIP lenders. ColFin is an affiliate of real-estate finance and investment company Colony Financial Inc. William Lyon also obtained interim permission to use cash collateral securing obligations to its prepetition lenders. A final hearing on the Debtors' request is set for Jan. 11, 2012, at 11:00 a.m. As of the petition date, the Debtors owe the prepetition secured parties not less than $206 million. The Debtors are also liable to a Make Whole Amount as defined in the prepetition loan agreement and an exit fee. The prepetition secured parties assert that the Make Whole Amount due and owing is not less than $69 million and the exit fee is not less than $12.9 million. The DIP loan obligations are secured by the Debtors' assets, except among others, estate causes of action under Chapter 5 of the Bankruptcy Code or applicable state avoidance action law as well as the assets of Circle G at the Church Farm North Joint Venture LLC. The Debtors are authorized under the DIP credit agreement to obtain a junior DIP financing facility, the obligations under which will be junior to the ColFin DIP facility. As adequate protection for the use of cash collateral, the Debtors will provide the prepetition lenders adequate protection liens and will pay for the lenders' legal fees and expenses incurred in the case. The DIP liens and adequate protection liens are subject to a carve-out for unpaid fees of the Clerk of Court and the U.S. Trustee pursuant to 28 U.S.C. Sec. 1930(a)(6); bankruptcy professional fees; and unpaid fees and expenses of the ad hoc group of noteholders (not to exceed $535,000) and the so-called backstop investors (not to exceed $200,000) in the case. The Interim DIP Order provides that the DIP Agent and the DIP lenders may credit bid the DIP obligations during any sale of any DIP collateral or prepetition collateral. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and its subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. William Lyon Homes and its affiliates commenced a prepackaged Chapter 11 reorganization (Bankr. D. Del. Lead Case No. 11-14019) on Dec. 19, 2011. William Lyon had been pursuing an out-of-court restructuring since January. The reorganization plan, announced in November, will reduce debt on borrowed money from $510 million to $328 million. The Debtors intend to obtain approval of the bankruptcy plan at a hearing beginning Feb. 10, 2012. The Chapter 11 plan already has been accepted by 97% in amount and 93% in number of senior unsecured notes. The Plan exchanges the notes for equity and generates $85 million in new cash. Holders owed $300 million on senior unsecured notes are to exchange the debt for $75 million in new secured notes plus 28.5% of the common equity. The Lyon family will invest $25 million in return for 20% of the common stock and warrants for another 9.1%. Senior secured lenders led by ColFin WLH Funding LLC, an affiliate of real-estate finance and investment company Colony Financial Inc., would receive a new $235 million 10.25% three-year secured note for existing secured claim of at least $206 million in principal. There will be a rights offering to buy $10 million in common stock and $50 million in convertible preferred stock, representing 51.5% of the new equity. A noteholder has agreed to buy any of the offering that isn't purchased. The company didn't make a $7.5 million interest payment payable Oct. 1, 2011, on $138.8 million in 10.75% senior notes due 2013. William Lyon expects to pay its remaining creditors in full, including vendors and other general unsecured creditors. Judge Christopher S. Sontchi presides over the case. Lawyers at Pachulski Stang Ziehl & Jones LLP serve as the Debtors' counsel. Lawyers at Irell & Manella LLP serve as their special counsel. Alvarez & Marsal Holdings LLC serves as the Debtors' financial advisors. Kurtzman Carson Consultants, LLC, serves as the Debtors' claims and notice agent. The petition says assets are $593.5 million with debt totaling $606.6 million as of Sept. 30, 2011. Counsel to the Backstop Investors are: Matthew K. Kelsey, Esq. J. Eric Wise, Esq. GIBSON, DUNN & CRUTCHER LLP 200 Park Avenue New York, NY 10166-0193 Tel: 212-351-2615 E-mail: mkelsey@gibsondunn.com ewise@gibsondunn.com Counsel to the Ad Hoc Noteholders Group are: Mark Shinderman, Esq. Neil Wertlieb, Esq. MILBANK, TWEED, HADLEY & MCCLOY LLP 601 South Figueroa Street Los Angeles, CA 90017 Tel: 213-892-4411 E-mail: mshinderman@milbank.com nwertlieb@milbank.com Delaware Counsel to the Ad Hoc Noteholders Group is: Robert J. Dehney, Esq. MORRIS, NICHOLS, ARSHT & TUNNELL LLP 1201 North Market Street, 18th Floor P.O. Box 1347 Wilmington, DE 19899-1347 Tel: (302) 351-9353 Fax: (302) 425-4673 E-mail: rdehney@mnat.com Counsel to the Prepetition Agent and the Prepetition Secured Lenders: David P. Simonds, Esq. AKIN GUMP STRAUSS HAUER & FELD LLP 2029 Century Park East, Suite 2400 Los Angeles, CA 90067-3010 Tel: 310-552-6692 E-mail: dsimonds@akingump.com - and - David Stratton, Esq. PEPPER HAMILTON LLP Hercules Plaza, Suite 5100 13013 Market Street, P.O. Box 1790 Wilmington DE 19801-1151 Tel: 302-777-6566 E-mail: strattond@pepperlaw.com The Prepetition Lenders also have hired FTI Consulting Inc. as advisors. WILLIAM LYON: Court Extends Schedules Filing Deadline ----------------------------------------------------- William Lyon Homes Inc. and its debtor-affiliates won a 70-day extension of their deadline to file their schedules of assets and liabilities and statements of financial affairs. The new deadline is March 28, 2012. Pursuant to 11 U.S.C. Sec. 521 and F.R.B.P. 1007, the Debtors are required to file, within 14 days of the Petition Date: (i) schedules of assets and liabilities; (ii) schedules of executory contracts and unexpired leases; (iii) lists of equity holders; (iv) schedules of current income and expenditures; and (v) statements of financial affairs. Rule 1007-1(b) of the Delaware Local Rules provides, however, that if the total number of creditors in a debtor's case exceeds 200, the debtor must file its Schedules and Statements within 30 days of the Petition Date. The Court's Order provides that in the event the Debtors' prepackaged plan of reorganization becomes effective prior to the expiration of the Extension Date, the requirement to file the Schedules and Statements is waived. The requirement to convene an 11 U.S.C. Sec. 341 (a) meeting of creditors is also waived if the Plan becomes effective prior to expiration of the Extension Date. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and its subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. William Lyon Homes and its affiliates commenced a prepackaged Chapter 11 reorganization (Bankr. D. Del. Lead Case No. 11-14019) on Dec. 19, 2011. William Lyon had been pursuing an out-of-court restructuring since January. The reorganization plan, announced in November, will reduce debt on borrowed money from $510 million to $328 million. The Debtors intend to obtain approval of the bankruptcy plan at a hearing beginning Feb. 10, 2012. The Chapter 11 plan already has been accepted by 97% in amount and 93% in number of senior unsecured notes. The Plan exchanges the notes for equity and generates $85 million in new cash. Holders owed $300 million on senior unsecured notes are to exchange the debt for $75 million in new secured notes plus 28.5% of the common equity. The Lyon family will invest $25 million in return for 20% of the common stock and warrants for another 9.1%. Senior secured lenders led by ColFin WLH Funding LLC, an affiliate of real-estate finance and investment company Colony Financial Inc., would receive a new $235 million 10.25% three-year secured note for existing secured claim of at least $206 million in principal. There will be a rights offering to buy $10 million in common stock and $50 million in convertible preferred stock, representing 51.5% of the new equity. A noteholder has agreed to buy any of the offering that isn't purchased. The company didn't make a $7.5 million interest payment payable Oct. 1, 2011, on $138.8 million in 10.75% senior notes due 2013. William Lyon expects to pay its remaining creditors in full, including vendors and other general unsecured creditors. Judge Christopher S. Sontchi presides over the case. Lawyers at Pachulski Stang Ziehl & Jones LLP serve as the Debtors' counsel. Lawyers at Irell & Manella LLP serve as their special counsel. Alvarez & Marsal Holdings LLC serves as the Debtors' financial advisors. Kurtzman Carson Consultants, LLC, serves as the Debtors' claims and notice agent. The petition says assets are $593.5 million with debt totaling $606.6 million as of Sept. 30, 2011. Counsel to the Backstop Investors are Matthew K. Kelsey, Esq., and J. Eric Wise, Esq., at Gibson, Dunn & Crutcher LLP. Counsel to the Ad Hoc Noteholders Group are Mark Shinderman, Esq., and Neil Wertlieb, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Delaware Counsel to the Ad Hoc Noteholders Group is Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Counsel to the Prepetition Agent and the Prepetition Secured Lenders are David P. Simonds, Esq., at Akin Gump Strauss Hauer & Feld LLP, and David Stratton, Esq., at Pepper Hamilton LLP. The Prepetition Lenders also have hired FTI Consulting Inc. as advisors. WILLIAM LYON: Has Green Light to Hire KCC as Claims Agent --------------------------------------------------------- William Lyon Homes sought and obtained authority from the Bankruptcy Court to employ Kurtzman Carson Consultants LLC as noticing, claims, balloting and subscription agent in connection with these chapter 11 cases. KCC will, among other things, provide expertise and consultation and assistance in claim and ballot process and other relevant administrative services; and provide necessary subscription services in connection with a proposed rights offering. Albert Kass, KCC's Vice President of Corporate Restructuring Services, attests that KCC (a) is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, and (b) does not hold or represent an interest materially adverse to the Debtors' estates. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and its subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. William Lyon Homes and its affiliates commenced a prepackaged Chapter 11 reorganization (Bankr. D. Del. Lead Case No. 11-14019) on Dec. 19, 2011. William Lyon had been pursuing an out-of-court restructuring since January. The reorganization plan, announced in November, will reduce debt on borrowed money from $510 million to $328 million. The Debtors intend to obtain approval of the bankruptcy plan at a hearing beginning Feb. 10, 2012. The Chapter 11 plan already has been accepted by 97% in amount and 93% in number of senior unsecured notes. The Plan exchanges the notes for equity and generates $85 million in new cash. Holders owed $300 million on senior unsecured notes are to exchange the debt for $75 million in new secured notes plus 28.5% of the common equity. The Lyon family will invest $25 million in return for 20% of the common stock and warrants for another 9.1%. Senior secured lenders led by ColFin WLH Funding LLC, an affiliate of real-estate finance and investment company Colony Financial Inc., would receive a new $235 million 10.25% three-year secured note for existing secured claim of at least $206 million in principal. There will be a rights offering to buy $10 million in common stock and $50 million in convertible preferred stock, representing 51.5% of the new equity. A noteholder has agreed to buy any of the offering that isn't purchased. The company didn't make a $7.5 million interest payment payable Oct. 1, 2011, on $138.8 million in 10.75% senior notes due 2013. William Lyon expects to pay its remaining creditors in full, including vendors and other general unsecured creditors. Judge Christopher S. Sontchi presides over the case. Lawyers at Pachulski Stang Ziehl & Jones LLP serve as the Debtors' counsel. Lawyers at Irell & Manella LLP serve as their special counsel. Alvarez & Marsal Holdings LLC serves as the Debtors' financial advisors. The petition says assets are $593.5 million with debt totaling $606.6 million as of Sept. 30, 2011. Counsel to the Backstop Investors are Matthew K. Kelsey, Esq., and J. Eric Wise, Esq., at Gibson, Dunn & Crutcher LLP. Counsel to the Ad Hoc Noteholders Group are Mark Shinderman, Esq., and Neil Wertlieb, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Delaware Counsel to the Ad Hoc Noteholders Group is Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Counsel to the Prepetition Agent and the Prepetition Secured Lenders are David P. Simonds, Esq., at Akin Gump Strauss Hauer & Feld LLP, and David Stratton, Esq., at Pepper Hamilton LLP. The Prepetition Lenders also have hired FTI Consulting Inc. as advisors. WILLIAM LYON: Hiring Pachulski Stang as Chapter 11 Counsel ---------------------------------------------------------- William Lyon Homes seeks Bankruptcy Court authority to employ Pachulski Stang Ziehl & Jones LLP as Chapter 11 counsel. The principal attorneys and paralegals presently designated to represent the Debtors and their current standard hourly rates are: Laura Davis Jones $895 David M. Bertenthal $775 Joshua M. Fried $650 Shirley S. Cho $650 Timothy P. Cairns $495 Kathleen P. Makowski $475 Monica Molitor $255 Pachulski received payments from the Debtors during the year prior to the Petition Date in the amount of $1,100,000 including the Debtors' aggregate filing fees for these cases, in connection with its prepetition representation of the Debtors. Ms. Jones, a partner at the firm, attests that Pachulski does not hold or represent any interest adverse to the Debtors' estates, the firm is a "disinterested person" as that phrase is defined in section 101(14) of the Bankruptcy Code, and its employment is necessary and in the best interests of the Debtors and their estates. About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and its subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. William Lyon Homes and its affiliates commenced a prepackaged Chapter 11 reorganization (Bankr. D. Del. Lead Case No. 11-14019) on Dec. 19, 2011. William Lyon had been pursuing an out-of-court restructuring since January. The reorganization plan, announced in November, will reduce debt on borrowed money from $510 million to $328 million. The Debtors intend to obtain approval of the bankruptcy plan at a hearing beginning Feb. 10, 2012. The Chapter 11 plan already has been accepted by 97% in amount and 93% in number of senior unsecured notes. The Plan exchanges the notes for equity and generates $85 million in new cash. Holders owed $300 million on senior unsecured notes are to exchange the debt for $75 million in new secured notes plus 28.5% of the common equity. The Lyon family will invest $25 million in return for 20% of the common stock and warrants for another 9.1%. Senior secured lenders led by ColFin WLH Funding LLC, an affiliate of real-estate finance and investment company Colony Financial Inc., would receive a new $235 million 10.25% three-year secured note for existing secured claim of at least $206 million in principal. There will be a rights offering to buy $10 million in common stock and $50 million in convertible preferred stock, representing 51.5% of the new equity. A noteholder has agreed to buy any of the offering that isn't purchased. The company didn't make a $7.5 million interest payment payable Oct. 1, 2011, on $138.8 million in 10.75% senior notes due 2013. William Lyon expects to pay its remaining creditors in full, including vendors and other general unsecured creditors. Judge Christopher S. Sontchi presides over the case. Lawyers at Irell & Manella LLP serve as the Debtors' special counsel. Alvarez & Marsal Holdings LLC serves as the Debtors' financial advisors. Kurtzman Carson Consultants, LLC, serves as the Debtors' claims and notice agent. The petition says assets are $593.5 million with debt totaling $606.6 million as of Sept. 30, 2011. Counsel to the Backstop Investors are Matthew K. Kelsey, Esq., and J. Eric Wise, Esq., at Gibson, Dunn & Crutcher LLP. Counsel to the Ad Hoc Noteholders Group are Mark Shinderman, Esq., and Neil Wertlieb, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Delaware Counsel to the Ad Hoc Noteholders Group is Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Counsel to the Prepetition Agent and the Prepetition Secured Lenders are David P. Simonds, Esq., at Akin Gump Strauss Hauer & Feld LLP, and David Stratton, Esq., at Pepper Hamilton LLP. The Prepetition Lenders also have hired FTI Consulting Inc. as advisors. WILLIAM LYON: Hiring Sitrick as Communications Consultant --------------------------------------------------------- William Lyon Homes seeks to hire Sitrick and Company as corporate communications consultant in the Chapter 11 cases. The Debtors first engaged Sitrick to provide corporate communications services with respect to a possible chapter 11 filing, with the effective date of retention being Sept. 27, 2011. During the period leading up to the Petition Date, Sitrick worked closely with the Debtors to develop a comprehensive communications strategy and materials which were used in the public announcement of the Chapter 11 Cases. Now that the Chapter 11 Cases have commenced, the Debtors require expert corporate communication services because their going concern value depends on the strength of their reputation. The Debtors said the uncertainty and stigma associated with an in court restructuring may negatively affect the Debtors' reputation if not properly addressed and managed, causing the Debtor's to lose business. The Debtors believe that Sitrick's services and advice will assist them in preserving their going concern value through this restructuring. Sitrick has agreed to represent the Debtors and charge, in connection with its professionals providing the Services related to these Chapter 11 cases, hourly rates for its services, which rates range from $185 to $495, depending on the particular professional. The hourly rates applicable to the professionals initially contemplated to represent the Debtors for the foregoing limited purposes are: Anita-Marie Laurie ($495); Tom Becker ($495); Aaron Curtiss ($495); Danielle Newman ($200); Ashley Cantwell ($185); and Rose Kautz ($185) Rates for senior professionals have been reduced by $100 per hour from $595 to $495 for this engagement. Ms. Laurie attests that Sitrick (i) has no connection with the Debtors, its creditors, or other parties in interest in the Chapter 11 Cases; (ii) does not hold any interest adverse to the Debtors' estates; and (iii) is a "disinterested person," as that term is defined in section 101(14) of the Bankruptcy Code, as modified by section 1107(b) thereof. On Oct. 21, 2011, Sitrick received a retainer fee of $162,000 for the services. Sitrick was paid $159,000 from the Retainer, leaving an approximate retainer balance of $3,000 as of the Petition Date. Also on Oct. 21, 2011, Sitrick was paid an expense advance in the amount of $5,000 to cover reasonable and necessary out-of-pocket expenses incurred by Sitrick. Out-of-pocket expenses may include, but are not limited to, travel, printing, postage, messenger, telephone, fax, copy charges and courier services incurred by Sitrick. Sitrick and Company may be reached at: SITRICK BRINCKO GROUP, LLC 1840 Century Park East, Suite 800 Los Angeles, CA 90067 Tel: (310) 788-2850 About William Lyon Homes Based in Newport Beach, California, William Lyon Homes and its subsidiaries -- http://www.lyonhomes.com/-- are primarily engaged in designing, constructing and selling single family detached and attached homes in California, Arizona and Nevada. William Lyon Homes and its affiliates commenced a prepackaged Chapter 11 reorganization (Bankr. D. Del. Lead Case No. 11-14019) on Dec. 19, 2011. William Lyon had been pursuing an out-of-court restructuring since January. The reorganization plan, announced in November, will reduce debt on borrowed money from $510 million to $328 million. The Debtors intend to obtain approval of the bankruptcy plan at a hearing beginning Feb. 10, 2012. The Chapter 11 plan already has been accepted by 97% in amount and 93% in number of senior unsecured notes. The Plan exchanges the notes for equity and generates $85 million in new cash. Holders owed $300 million on senior unsecured notes are to exchange the debt for $75 million in new secured notes plus 28.5% of the common equity. The Lyon family will invest $25 million in return for 20% of the common stock and warrants for another 9.1%. Senior secured lenders led by ColFin WLH Funding LLC, an affiliate of real-estate finance and investment company Colony Financial Inc., would receive a new $235 million 10.25% three-year secured note for existing secured claim of at least $206 million in principal. There will be a rights offering to buy $10 million in common stock and $50 million in convertible preferred stock, representing 51.5% of the new equity. A noteholder has agreed to buy any of the offering that isn't purchased. The company didn't make a $7.5 million interest payment payable Oct. 1, 2011, on $138.8 million in 10.75% senior notes due 2013. William Lyon expects to pay its remaining creditors in full, including vendors and other general unsecured creditors. Judge Christopher S. Sontchi presides over the case. Lawyers at Irell & Manella LLP serve as the Debtors' special counsel. Alvarez & Marsal Holdings LLC serves as the Debtors' financial advisors. Kurtzman Carson Consultants, LLC, serves as the Debtors' claims and notice agent. The petition says assets are $593.5 million with debt totaling $606.6 million as of Sept. 30, 2011. Counsel to the Backstop Investors are Matthew K. Kelsey, Esq., and J. Eric Wise, Esq., at Gibson, Dunn & Crutcher LLP. Counsel to the Ad Hoc Noteholders Group are Mark Shinderman, Esq., and Neil Wertlieb, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Delaware Counsel to the Ad Hoc Noteholders Group is Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Counsel to the Prepetition Agent and the Prepetition Secured Lenders are David P. Simonds, Esq., at Akin Gump Strauss Hauer & Feld LLP, and David Stratton, Esq., at Pepper Hamilton LLP. The Prepetition Lenders also have hired FTI Consulting Inc. as advisors. WINDRUSH SCHOOL: Wells Fargo Withdraws Motion for Case Conversion ----------------------------------------------------------------- Creditor, Wells Fargo Bank, N.A., as indenture trustee, notifies the U.S. Bankruptcy Court for the Northern District of California that it has withdrawn its motion dismiss or convert the Chapter 11 case of Windrush School to one under Chapter 7 of the Bankruptcy Code. The motion was filed on Dec. 2, 2011, and was scheduled for hearing on Jan. 4, 2012. Wells Fargo is represented by: Mike C. Buckley, Esq. James Neudecker, Esq. Renee C. Feldman, Esq REED SMITH LLP 101 Second Street, Suite 1800 San Francisco, CA 94105-3659 Tel: +1 415 543 8700 Fax: +1 415 391 8269 E-mail: mbuckley@reedsmith.com jneudecker@reedsmith.com rfeldman@reedsmith.com About Windrush School Based in El Cerrito, California, Windrush School is a private K-8 school. The Company filed for Chapter 11 protection on Sept. 30, 2011 (Bankr. D. N.D. Calif. Case No. 11-70440). Judge William J. Lafferty presides over the case. Merle C. Meyers, Esq., at Meyers Law Group PC, represents the Debtor. The Debtor disclosed $14,809,364 in assets and $13,206,276 in liabilities as of the Chapter 11 filing. Attorneys for secured lender Wells Fargo Bank N.A. are Mike C. Buckley, Esq., James Neudecker, Esq., and Renee C. Feldman, Esq., at Reed Smith LLP. Wells Fargo is the Indenture Trustee on $13 million of bonds issued by the California Statewide Communities Development Authority to Windrush School. WINDRUSH SCHOOL: Bank Wants Case Converted to Ch. 7 or Dismissed ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of California has scheduled a hearing for Jan. 4, 2012, at 9:15 a.m. to consider the motion of Well Fargo Bank, National Association, as Indenture Trustee under an Indenture between California Statewide Communities Development Authority and Indenture Trustee dated as of July 1, 2017, pertaining to $13,000,000 of revenue bonds issued by the Authority, to convert Windrush School's case to one under Chapter 7 of the Bankruptcy Code, or in the alternative to dismiss the case in its entirety. In its motion, filed Nov. 28, 2011, and entered Dec. 2, 2011, the Bank said that cause exists for conversion or dismissal because substantial or continuing loss or diminution of the estate is occurring and there is an absence of a reasonable likelihood of rehabilitation. About Windrush School Based in El Cerrito, California, Windrush School is a private K-8 school. The Company filed for Chapter 11 protection on Sept. 30, 2011 (Bankr. D. N.D. Calif. Case No. 11-70440). Judge William J. Lafferty presides over the case. Merle C. Meyers, Esq., at Meyers Law Group PC, represents the Debtor. The Debtor estimated assets and debts of between $10 million and $50 million. Attorneys for secured lender Wells Fargo Bank N.A. are Mike C. Buckley, Esq., James Neudecker, Esq., and Renee C. Feldman, Esq., at Reed Smith LLP. Wells Fargo is the Indenture Trustee under an Indenture between California Statewide Communities Development Authority dated as of July 1, 2017, pertaining to $13,000,000 of revenue bonds issued by the Authority. * Upcoming Meetings, Conferences and Seminars --------------------------------------------- April 3-5, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference Grand Hyatt Atlanta, Atlanta, Ga. Contact: http://www.turnaround.org/ Apr. 19-22, 2012 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ November 1-3, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Westin Copley Place, Boston, Mass. Contact: http://www.turnaround.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ April 10-12, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott Chicago, Chicago, Ill. Contact: http://www.turnaround.org/ October 3-5, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Wardman Park, Washington, D.C. Contact: http://www.turnaround.org/ ********* 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 ***