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/raid1/www/Hosts/bankrupt/TCR_Public/120515.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, May 15, 2012, Vol. 16, No. 134 Headlines AFA FOODS: Debtor & Yucaipa Sued Over Layoffs ALL LAND INVESTMENTS: Court Dismisses Chapter 11 Case AMERICA WEST: Denly Utah Discloses 46.2% Equity Stake AMERICAN APPAREL: Incurs $7.8 Million Net Loss in First Quarter AMERICAN APPAREL: GCIC Discloses 18.4% Equity Stake ANGELO ROMANO: 9th Cir. BAP Affirms Ruling on Richardson Fees APPLIED MINERALS: Incurs $4 Million Net Loss in First Quarter ATP OIL: Incurs $145.1 Million Net Loss in First Quarter AVANTAIR INC: Incurs $1.1 Million Net Loss in First Quarter BEAZER HOMES: Elizabeth Acton Named to Board of Directors BERNARD L. MADOFF: Dist. Judge's Opinion in Refco Presages Rulings BLUEGREEN CORP: Closes Sale of Bluegreen for $29 Million BOWLES SUB: Parcel A Hires Lapp Libra as Bankruptcy Counsel CAPITOL INFRASTRUCTURE: Judge Allows Capitol to Reject Contracts CASCADE BANCORP: Eleven Directors Elected at Annual Meeting CATALYST PAPER: Reports $25.6 Million First Quarter Net Loss CHINA SHENGDA: Gets Non-Compliance Notice From NASDAQ CINRAM INT'L: Lenders Agree to Extend Waiver to May 30 CONTRACT RESEARCH: Has Approval for Settlement, Loan and Bonuses CORBIN PARK: BAP Says Mortgagee Has Priority Over Mechanic's Lien DELTA PETROLEUM: Court Approves Laramie as Plan Sponsor DEX ONE: Seven Directors Elected at Annual Meeting DOLLAR THRIFTY: Moody's Raises CFR/PDR to 'B1'; Outlook Stable ECOSPHERE TECHNOLOGIES: Files Form 10-Q; Posts $746,781 Q1 Loss ELEPHANT TALK: Incurs $6 Million Net Loss in First Quarter ELEPHANT TALK: Files Form S-3, Registers 90.4-Mil. Common Shares EMERALD PERFORMANCE: Upsized Loan No Impact on Moody's 'B2' CFR EMMIS COMMUNICATIONS: Swings to $79.5-Mil. Net Income in 2011 ENTREMED INC: Regains Compliance With Equity Listing Requirement EPICEPT CORP: Incurs $4.7 Million Net Loss in First Quarter GEOMET INC: Transfers Listings to the NASDAQ Capital Market GEORGE VAN WAGNER: Ch. 7 Trustee Didn't Abandon Causes of Action GMX RESOURCES: Files Form 10-Q, Incurs $37.8MM Net Loss in Q1 GREENMAN TECHNOLOGIES: Gregory Ho Discloses 39.5% Equity Stake GUSHAN ENVIRONMENTAL: Gets NYSE Notice of Non-Compliance HALO COMPANIES: Whitley Penn Succeeds Montgomery as Accountants HARRISBURG, PA: Officials Seek to Halt State Receivership Case HEALTH NET: Moody's Retains 'Ba3' Sr. Debt Rating, Outlook Stable HENRY FAJARDO: MFC Twin Builders Goes Back to State Court HOMER CITY: Moody's Cuts Rating on Pass Through Bonds to 'Caa1' HORNE INTERNATIONAL: Amends Loan Pact with Messrs. Horne & Foster HOSTESS BRANDS: KPS Capital Reportedly Eyeing Cakes Maker HOUGHTON MIFFLIN: To Swap Debt for New Equity Via Ch. 11 HOUGHTON MIFFLIN: Moody's Cuts CFR/PDR to 'Ca'; Outlook Stable HUGHES TELEMATICS: Incurs $15.6 Million Net Loss in Q1 INTELSAT SA: Receives Additional Tenders of $1.5MM 9 1/2% Notes ISTAR FINANCIAL: Files Form 10-Q, Incurs $46MM Net Loss in Q1 JAMES RIVER: Michael Cook Holds 4.3% of Class A Common Shares LIBERTY HARBOR: Sues Former Business Partner Over 'Invalid' Deed LIGHTSQUARED INC: Case Summary & 20 Largest Unsecured Creditors LIGHTSQUARED INC: Files for Bankruptcy As It Deals With FCC LL MURPHREY: Court Pegs Recapitalized Debt at $6.18-Mil. LOTHIAN OIL: Creditor Asks 2nd Circ. to Resolve Jurisdiction Row MARRICK PROPERTIES: St. Petersburg Boutique Hotel in Chapter 11 MILESTONE SCIENTIFIC: Incurs $355,000 Net Loss in First Quarter MPG OFFICE: Files Form 10-Q, Posts $10.4-Mil. Net Income in Q1 MORGANS HOTEL: Incurs $14.5 Million Net Loss in First Quarter MSR RESORT: Judge Sides With Hilton in Property Management Row NAVISTAR INTERNATIONAL: Wellington Ceases to Hold 5% Stake NAVISTAR INTERNATIONAL: Franklin Discloses 12.4% Equity Stake NES RENTALS: Moody's Affirms 'Caa1' CFR, Rates Term Loan 'Caa2' NEWPAGE CORP: Hearing Rescheduled Amid Dewey & LeBoeuf Woes NO FEAR RETAIL: Liquidated, Paying Unsecured Creditors 2% to 6% NORTEL NETWORKS: Close to Ending Fight With Asian Units NORTEL NETWORKS: In Mediation With Asian, LatAm Affiliates NORTHCORE TECHNOLOGIES: Envision Wins Consumers Choice Award NRG ENERGY: Moody's Changes Outlook to Negative, Retains Ba3 CFR OILSANDS QUEST: CCAA Creditor Protection Extended to June 29 OMNICOMM SYSTEMS: Incurs $3.4 Million Net Loss in First Quarter OTTILIO PROPERTIES: Files for Chapter 11 Anew OVERLAND STORAGE: Incurs $3.8 Million Net Loss in March 31 Qtr. PEGASUS RURAL: Xanadoo to Hold June 26 Auction for Tower Assets PINNACLE AIRLINES: Steelworkers Object to $74.3MM DIP Deal PRINCE SPORTS: Agrees to License Iconic Brands to Battle Sports PSS WORLD: Moody's Says Strategic Transformation Plan Credit Neg QUANTUM FUEL: Incurs $7.8 Million Net Loss in First Quarter QUIGLEY CO: Not Abandoning Reorganization After Loss on Appeal REDDY ICE: Debtors and Creditors Oppose Official Equity Committee REFCO INC: Dist. Judge Opinion Presages Rulings in Madoff REFLECT SCIENTIFIC: Incurs $259,000 Net Loss in First Quarter REGAL ENTERTAINMENT: Three Directors Elected at Annual Meeting REGAL ENTERTAINMENT: Registers Add'l 5MM Shares Under 2002 Plan RESIDENTIAL CAPITAL: Files for Chapter 11 in New York RESIDENTIAL CAPITAL: Case Summary & 50 Largest Unsecured Creditors ROYAL MANOR: 6th Cir. Affirms Order Denying Gordons' Claims SAN ANTONIO OPERA: Files in Chapter 7 to Liquidate SOLAR TRUST: Gets Court Approval to Auction Assets SOUTH BAY LUBE: Files for Chapter 11 in Tampa STEREOTAXIS INC: Files Form 10-Q; Incurs $5.8MM Net Loss in Q1 STONECREST FIN'L: Perpetual Care Trust Fund Not Estate's Asset SUFFOLK REGIONAL: Files for Ch. 9 Again After Law Passed THERMOENERGY CORP: Security Investors Holds 8.4% Equity Stake UNIGENE LABORATORIES: Files Form 10-Q, Incurs $6MM Loss in Q1 VERENIUM CORP: Reports $30.1 Million Net Income in Q1 VITAMINSPICE INC: Says Jehu Hand's New Suit is Frivolous VITRO SAB: Vulture Funds Ordered to Pay Legal Fees VITRO SAB: NY Appeals Court Won't Enforce Mexican Court Ruling VITRO SAB: Scores Two Victories Over Bondholders in Mexico WESTLAKE CHEMICAL: Moody's Confirms 'Ba3' CFR; Outlook Stable WHITETAIL WOODS: Marine Bank Wins Dismissal of Bankruptcy Case Z TRIM HOLDINGS: Sells 744,711 Shares to Brightline for $1.1MM * S&P: Global Default Count Rises Over the Last Six Months * Junk Default Rates Increase Fractionally in April * Large Bank Stress Testing Guidance Finalized * Large Companies With Insolvent Balance Sheets ********* AFA FOODS: Debtor & Yucaipa Sued Over Layoffs --------------------------------------------- AFA Foods Inc. and its owner Yucaipa Cos. were sued in bankruptcy court Thursday for a mass firing without giving workers the 60 days notice required by the Worker Adjustment Retraining and Notification Act, commonly known as the Warn Act. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that according to the complaint, after AFA's bankruptcy filing, a plant closed and 200 workers were fired without notice required by the Warn Act, according to the complaint. The lawsuit is intended to be a class action on behalf of all AFA workers fired without the required notice. Max Stendahl at Bankruptcy Law360 reports that lead plaintiff Nadia Sanchez claimed she was fired from her job at AFA's Los Angeles plant, part of mass layoffs the company instituted in the days after its April 2 bankruptcy filing. AFA called the employees into a meeting and told them they were being terminated. About AFA Foods King of Prussia, Pennsylvania-based AFA Foods Inc. is one of the largest processors of ground beef products in the United States. The Company has five processing facilities and two ancillary facilities across the country with annual processing capacity of 800 million pounds. AFA has seven facilities capable of producing 800 million pound of ground beef annually. Revenue in 2011 was $958 million. Yucaipa Cos. acquired the business in 2008 and currently owns 92% percent of the common stock and all of the preferred stock. AFA Foods, AFA Investment Inc. and other affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-11127) on April 2, 2012, after recent changes in the market for its ground beef products and the impact of negative media coverage related to boneless lean beef trimmings -- BLBT -- affected sales. Judge Mary Walrath presides over the case. Lawyers at Jones Day and Pachulski Stang Ziehl & Jones LLP serve as the Debtors' counsel. FTI Consulting Inc. serves as financial advisors and Imperial Capital LLC serves as marketing consultants. Kurtzman Carson Consultants LLC serves as noticing and claims agent. As of Feb. 29, 2012, on a consolidated basis, the Debtors' books and records reflected approximately $219 million in assets and $197 million in liabilities. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven members to the official committee of unsecured creditors in the Chapter 11 cases of AFA Investment Inc., AFA Foods and their debtor-affiliates. McDonald Hopkins LLC and Potter Anderson & Corroon LLP represents the Committee. Judge Mary Walrath on May 8 entered procedures for the sale of substantially all assets of AFA Foods and its affiliates. Although no buyer is yet under contract, bids are due June 19, followed by an auction June 21 and a hearing for sale approval on June 26. AFA has the right to select a stalking horse bidder or bidders by June 11. The plants will be offered for sale either in groups or individually. Pending sale, the Chapter 11 effort is being financed with a loan of about $60 million provided by existing lenders General Electric Capital Corp. and Bank of America Corp. ALL LAND INVESTMENTS: Court Dismisses Chapter 11 Case ----------------------------------------------------- The Bankruptcy Court dismissed the Chapter 11 case of All Land Investments LLC. On March 9, 2012, the Court denied confirmation of All Land Investment's Plan and set a hearing to determine whether the bankruptcy case should be dismissed. The hearing was held April 5, during which the Debtor advised the Court it had no objection to the dismissal. No other party also stepped forward to lodge an objection. The dismissal order was issued April 12. Newark, Delaware-based All Land Investments, LLC, operates a real estate business. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 09-13790) on Oct. 29, 2009. Gary F. Seitz, Esq., at Rawle & Henderson LLP, serves counsel to the Debtor in the Chapter 11 case. The Company disclosed $20.2 million in assets and $22.8 million in liabilities as of the Chapter 11 filing. AMERICA WEST: Denly Utah Discloses 46.2% Equity Stake ----------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Denly Utah Coal, LLC, and its affiliates disclosed that, as of July 14, 2011, they beneficially own 32,952,247 shares of common stock of America West Resources, Inc., representing 46.2% of the shares outstanding. Denly Utah previously reported beneficial ownership of 21,467,884 common shares or a 40.9% equity stake as of March 31, 2011. A copy of the amended filing is available for free at: http://is.gd/JPun4u About America West Based in Salt Lake City, Utah, America West Resources, Inc., is an established domestic coal producer engaged in the mining of clean and compliant (low-sulfur) coal. The majority of the Company's coal is sold to utility companies for use in the generation of electricity. The Company reported a net loss of $16.35 million on $11.08 million of total revenue for the nine months ended Sept. 30, 2011. The Company had a net loss of $16.14 million on $10.07 million of total revenue for the year ended Dec. 31, 2010, Following a net loss of $8.70 million on $11.01 million of total revenue during the prior year. The Company's balance sheet at Sept. 30, 2011, showed $31.47 million in total assets, $23.12 million in total liabilities, and $8.35 million in total stockholders' equity. As reported by the TCR on April 21, 2011, MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt about America West's ability to continue as a going concern, following the 2010 financial results. The independent auditors noted that the Company has a working capital deficit and has incurred significant losses. AMERICAN APPAREL: Incurs $7.8 Million Net Loss in First Quarter --------------------------------------------------------------- American Apparel, Inc., reported a net loss of $7.89 million on $132.66 million of net sales for the three months ended March 31, 2012, compared with a net loss of $20.74 million on $116.06 million of net sales for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $331.38 million in total assets, $288.97 million in total liabilities and $42.41 million in total stockholders' equity. John Luttrell, Chief Financial Officer of American Apparel, Inc., stated, "We are pleased with our first quarter results and solid improvements across all of our businesses. Our wholesale and online channels both reported record sales for the quarter, and we are highly encouraged by the continued momentum in comparable sales from our retail stores, both domestic and international. Though the first quarter is historically our slowest quarter of the year, significant sales growth and the related leveraging of fixed costs helped us meaningfully reduce our EBITDA loss. We expect key initiatives in the areas of merchandise planning, supply chain, IT systems, and inventory control to drive further sales and expense improvements for the balance of the year. Accordingly, we reiterate our adjusted EBITDA guidance of $32 to $40 million for the full year 2012." A copy of the press release is available for free at: http://is.gd/XYRHaz 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. Amid liquidity problems and declining sales, American Apparel in early 2011 reportedly tapped law firm Skadden, Arps, Slate, Meagher & Flom and investment bank Rothschild Inc. for advice on a restructuring. 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. Under the deal, the investors were buying 15.8 million shares of common stock at 90 cents apiece. The deal allows the investors to purchase additional 27.4 million shares at the same price. The Company reported a net loss of $39.31 million in 2011 and a net loss of $86.31 million in 2010. AMERICAN APPAREL: GCIC Discloses 18.4% Equity Stake --------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, GCIC Ltd. disclosed that, as of April 30, 2012, it beneficially owns 20,005,216 common shares of Americal Apparel, Inc., representing 18.38% undiluted. The shares are held within mutual funds or other client accounts managed by GCIC Ltd. acting as Investment Counsel and Portfolio Manager. A copy of the filing is available for free at http://is.gd/ehSh4C 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. Amid liquidity problems and declining sales, American Apparel in early 2011 reportedly tapped law firm Skadden, Arps, Slate, Meagher & Flom and investment bank Rothschild Inc. for advice on a restructuring. 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. Under the deal, the investors were buying 15.8 million shares of common stock at 90 cents apiece. The deal allows the investors to purchase additional 27.4 million shares at the same price. The Company reported a net loss of $39.31 million in 2011 and a net loss of $86.31 million in 2010. The Company's balance sheet at March 31, 2012, showed $331.38 million in total assets, $288.97 million in total liabilities and $42.41 million in total stockholders' equity. ANGELO ROMANO: 9th Cir. BAP Affirms Ruling on Richardson Fees ------------------------------------------------------------- The U.S. Bankruptcy Appellate Panel for the Ninth Circuit affirmed both the bankruptcy court's order on Richardson & Richardson, P.C.'s second and final fee application in the bankruptcy case of Angelo and Sharon Romano, and the bankruptcy court's order denying Mr. Richardson's motion under Rule 90232 made with respect to the court's order on fees. The Romanos hired Richardson to file their bankruptcy case, to represent them in that case, and to sue West Fourth Avenue, LLC, for lender liability. The bankruptcy court -- based on the Romanos' objections, the absence of meaningful authorization of Richardson's services, Richardson's unreasonable billing practices, and his lack of candor -- limited Richardson's fee award to the amount the Romanos already had paid -- $21,339 -- thereby disallowing $31,352 of the total $52,991 Richardson had requested in fees and costs. Angelo and Sharon Romano owned and operated a trucking business. The Romanos borrowed money from a hard money lender, West Fourth Avenue LLC, and in exchange gave Fourth Avenue a deed of trust on the real property they used in operating their trucking business. The trucking business began experiencing financial difficulties, and the Romanos advised Fourth Avenue that they would not be able to repay the loan on its due date. The Romanos and Fourth Avenue engaged in loan modification negotiations, but those negotiations broke down, and Fourth Avenue commenced foreclosure proceedings. The Romanos thereafter filed their chapter 11 bankruptcy case (Case No. 09-23446) on Sept. 22, 2009. The United States Trustee twice sought to convert the Romanos' bankruptcy case from chapter 11 to chapter 7, once on Jan. 26, 2010, and again on Feb. 16, 2010. According to the Romanos, the U.S. Trustee advocated for conversion because Richardson missed deadlines for filing a proposed chapter 11 plan on behalf of the Romanos. The Romanos asserted that Richardson should not receive compensation for responding to the U.S. Trustee's conversion efforts. In response, Richardson contended: (1) the United States Trustee over-reacted to the missed filing deadlines, and (2) the Romanos caused him to miss the filing deadlines because they did not provide him with sufficient information to file a plan. The appellate case is RICHARDSON & RICHARDSON, P.C., Appellant, v. ANGELO ANTHONY ROMANO; SHARON MARIE ROMANO, Appellees, BAP No. AZ- 11-1434-MkPaD (9th Cir. BAP). A copy of the decision dated May 7, 2012, is available at http://is.gd/IJlURpfrom Leagle.com. APPLIED MINERALS: Incurs $4 Million Net Loss in First Quarter ------------------------------------------------------------- Applied Minerals, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to the Company of $4.05 million on $55,402 of revenue for the three months ended March 31, 2012, compared with a net loss attributable to the Company of $1.69 million on $44,468 of revenue for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $10.68 million in total assets, $5.24 million in total liabiilties and $5.44 million in total stockholders' equity. The Company has incurred material recurring losses from operations. At March 31, 2012, the Company had a total accumulated deficit of approximately $43,084,500. For the three months ended March 31, 2012, and 2011, the Company sustained net losses from exploration stage before discontinued operations of approximately $4,056,700 and $1,695,100, respectively. The Company said that these factors indicate that it may be unable to continue as a going concern for a reasonable period of time. The Company's continuation as a going concern is contingent upon its ability to generate revenue and cash flow to meet its obligations on a timely basis and management's ability to raise financing or dispose of certain non-core assets as required. If successful, this will mitigate the factors that raise substantial doubt about the Company's ability to continue as a going concern. A copy of the Form 10-Q is available for free at: http://is.gd/gPlAXg About Applied Minerals New York City-based Applied Minerals, Inc. (OTC BB: AMNL) is a leading global producer of halloysite clay used in the development of advanced polymer, catalytic, environmental remediation, and controlled release applications. The Company operates the Dragon Mine located in Juab County, Utah, the only commercial source of halloysite clay in the western hemisphere. Halloysite is an aluminosilicate clay that forms naturally occurring nanotubes. The Company reported a net loss attributable to the Company of $7.48 million in 2011, a net loss attributable to the Company of $4.76 million in 2010, and a net loss attributable to the Company of $6.76 million in 2009. Bankruptcy Warning At Dec. 31, 2011, and 2010, the Company had accumulated deficits of $39,183,632 and $31,543,411, respectively, in addition to limited cash and unprofitable operations. For the year ended Dec. 31, 2011, and 2010, the Company sustained net losses before discontinued operations of $7,476,864 and $4,891,525, respectively. As of March 15, 2012, the Company has not commercialized the Dragon Mine and has had to rely on cash flow generated from the sale of stock and convertible debt to fund its operations. If the Company is unable to fund its operations through the commercialization of the Dragon Mine, the sale of equity or debt or a combination of both, it may have to file bankruptcy. ATP OIL: Incurs $145.1 Million Net Loss in First Quarter -------------------------------------------------------- ATP Oil and Gas Corporation filed with the U.S. Securities and Exhange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to common shareholders of $145.07 million on $146.61 million of oil and gas production revenues for the three months ended March 31, 2012, compared with a net loss attributable to common shareholders of $119.54 million on $166.50 million of oil and gas production revenues for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $3.63 billion in total assets, $3.48 billion in total liabilities, $115.81 million in redeemable noncontrolling interest, $71.18 million in 8% convertible perpetual preferred stock, and a $34.44 million total shareholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/tOtnJo A copy of the press release announcing the financial results is available for free at http://is.gd/98AsP3 About ATP Oil Houston, Tex.-based ATP Oil & Gas Corporation is an international offshore oil and gas development and production company focused in the Gulf of Mexico, Mediterranean Sea and North Sea. The Company trades publicly as ATPG on the NASDAQ Global Select Market. AVANTAIR INC: Incurs $1.1 Million Net Loss in First Quarter ----------------------------------------------------------- Avantair, Inc., reported a net loss attributable to common stockholders of $1.10 million on $40.05 million of total revenue for the three months ended March 31, 2012, compared with a net loss attributable to common stockholders of $1.32 million on $36.48 million of total revenues for the same period a year ago. The Company reported a net loss attributable to common stockholders of $4.42 million on $116.64 million of total revenue for the nine months ended March 31, 2012, compared with a net loss attributable to common stockholders of $10.94 million on $108.85 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2012, showed $98.86 million in total assets, $132 million in total liabilities, $14.77 million in series A convertible preferred stock, and a $47.91 million total stockholders' deficit. Steven Santo, Chief Executive Officer of Avantair said, "Though these results are better than one year ago and our prior quarter, we are not satisfied and will continue to focus on taking appropriate actions to achieve sustainable and growing profitability. During our recent quarter, we undertook a series of actions in the sales and finance areas of our business, which we believe will improve our operating results." A copy of the press release is available for free at: http://is.gd/k2BFaS About Avantair Inc. Headquartered in Clearwater, Fla., Avantair, Inc. (OTC BB: AAIR) -- http://www.avantair.com/-- sells fractional ownership interests in, and flight hour card usage of, professionally piloted aircraft for personal and business use, and the management of its aircraft fleet. According to AvData, Avantair is the fifth largest company in the North American fractional aircraft industry. Avantair also operates fixed flight based operations (FBO) in Camarillo, California and in Caldwell, New Jersey. Through these FBOs and its headquarters in Clearwater, Florida, Avantair provides aircraft maintenance, concierge and other services to its customers as well as to the Avantair fleet. The Company reported a net loss of $2.57 million on $76.58 million of total revenue for the six months ended Dec. 31, 2011, compared with a net loss of $8.88 million on $72.36 million of revenue for the same period a year ago. BEAZER HOMES: Elizabeth Acton Named to Board of Directors --------------------------------------------------------- Beazer Homes USA, Inc., has elected Elizabeth S. Acton to its Board of Directors effective May 10, 2012. Ms. Acton, who brings considerable expertise and over 35 years of experience in financial management, will also serve on the Board of Directors' Finance and Audit Committees. As Executive Vice President and Chief Financial Officer of Comerica Inc. since 2002, Ms. Acton was instrumental in successfully guiding Comerica through the deepest recession in recent history, enabling the bank to maintain its credit rating throughout the downturn. Ms. Acton transitioned to Executive Vice President, Finance in November 2011 preceding her retirement in April 2012. Comerica is a financial services company with over $62 billion in assets. Prior to joining Comerica, Ms. Acton was Vice President-Treasurer at Ford Motor Company, where she had responsibility for worldwide automotive and financial services treasury activities. Ms. Acton holds a bachelor of arts degree from the University of Minnesota and a master of business administration from Indiana University. About Beazer Homes Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/-- headquartered in Atlanta, is one of the country's 10 largest single-family homebuilders with continuing operations in Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New Mexico, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol "BZH." The Company's balance sheet at Dec. 31, 2011, showed $1.87 billion in total assets, $1.67 billion in total liabilities, and $200.38 million in total stockholders' equity. * * * Beazer carries (i) a 'B-' issuer credit rating, with "stable" outlook, from Standard & Poor's, (ii) 'Caa2' probability of default and corporate family ratings from Moody's, and (iii) 'B-' issuer default rating, with stable outlook, from Fitch Ratings. Fitch said in November 2010 that the ratings and Outlook for Beazer reflect the company's healthy liquidity position, improved capital structure as well as the challenges still facing the housing market. Fitch expects existing home sales will decline 7.5% in 2010 and increase 6% in 2011. S&P said that although Beazer's business and liquidity profiles have improved, S&P doesn't anticipate raising its ratings on the company over the next 12 months because S&P expects costs associated with the company's heavy debt load will weigh on profitability. In a credit opinion issued in March 2012, Moody's said that the Caa2 corporate family rating reflects Moody's expectation that Beazer's operating and financial performance, while improving modestly, will remain weak over the next two years. More specifically, Moody's assumes that elevated debt leverage, on- going operating losses, and declining tangible equity will continue over this time period. In addition, Moody's expects that Beazer's cash flow generation, which was a negative $113 million on a reported basis (and a negative $106 million on a Moody's- adjusted basis) over the trailing 12 months ended December 31, 2011, will continue to be weak in fiscal 2012 and 2013, as the benefits of inventory liquidation have largely played out and the company pursues land investments. BERNARD L. MADOFF: Dist. Judge's Opinion in Refco Presages Rulings ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that U.S. District Judge Jed Rakoff in New York opined Wednesday that bankruptcy judges can't make final rulings in fraudulent transfer suits, the opposite result reached by the bankruptcy judge in the same case involving Refco Inc. According to the report, Judge Rakoff said that in a "core" matter such as a fraudulent transfer suit, he must give effect to the "clear intent" of Congress by sending the case back to the bankruptcy court for report and recommendation. Judge Rakoff's decision May 9 likely indicates how he will rule in hundreds of cases before him involving the liquidation of Bernard L. Madoff Investment Securities LLC. The report recounts that the fraudulent transfer lawsuit was filed by a trust created under the Chapter 11 plan for Refco. The defendant sought to remove the case from the bankruptcy court to the district court under Stern v. Marshall, where the U.S. Supreme Court ruled in June that bankruptcy courts lack power under the Constitution to make final rulings based on claims arising under state law. Addressing the question of his power in a decision in November in the Refco case, U.S. Bankruptcy Judge Robert Drain concluded that he retained power to make final rulings in fraudulent transfer cases even with Stern on the books. Judge Drain reasoned that even if he were to dismiss the suit, his ruling would go up on appeal under the so-called de novo standard. Thus, Drain believed, he could enter a final order on a motion to dismiss. Judge Rakoff, according to the report, said that Drain's reasoning was "flawed." Because Stern doesn't give the bankruptcy court ability to make final orders, the grant of a motion to dismiss shouldn't be given "res judicata or collateral estoppel effect," the judge said. Judge Rakoff said that fraudulent transfer suits invoke "private rights" where the final decision can only be made in a district court. The suit involved "core" disputes the bankruptcy judge had been handling for three years, Judge Rakoff said. "Having the benefit of the report and recommendation (by the bankruptcy court) will save the district court and the parties an immense amount of time," Judge Rakoff concluded. As a result, he sent the suit back to the bankruptcy judge for further processing. In view of the defendants' demand for a jury trial, Judge Rakoff said he "may withdraw the reference if and when a trial is necessary." According to Mr. Rochelle, Judge Rakoff's decision in the Refco case likely presages decisions he will issue in hundreds of lawsuits arising out of the Madoff liquidation where he is being asked to remove the case from the bankruptcy judge and decide on fraudulent transfer claims himself as a result of the Stern decision. In Madoff lawsuits, Rakoff is generally making decisions himself on what he says are issues of non-bankruptcy law. In the Madoff cases, Judge Rakoff has yet to decide the same issues he ruled on yesterday in Refco, namely, whether the cases should remain in district court or be returned to the bankruptcy court. The case in district court is Kirschner v. Agoglia, 11- 8250, U.S. District Court, Southern District of New York (Manhattan). The case in bankruptcy court is Kirschner v. Agoglia (In re Refco Inc.), 07-3060, U.S. Bankruptcy Court, Southern District of New York (Manhattan). About Refco Inc. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- was a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries were members of principal U.S. and international exchanges, and were among the most active members of futures exchanges in Chicago, New York, London and Singapore. Refco was also a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco was one of the largest global clearing firms for derivatives. The Company had operations in Bermuda. The Company and 23 of its affiliates filed for Chapter 11 protection on October 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represented the Debtors in their restructuring efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its Chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on December 15, 2006. That Plan became effective on Dec. 26, 2006. Pursuant to the plan, RJM, LLC, was named plan administrator to reorganized Refco, Inc., and its affiliates, and Marc S. Kirschner as plan administrator to Refco Capital Markets, Ltd. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) The SIPA Trustee has said that as of March 31, 2012, through prepetition litigation and other settlements, he has successfully recovered, or reached agreements to recover, more than $9 billion -- over 50% of the principal lost in the Ponzi scheme by those who filed claims -- for the benefit of all customers of BLMIS. The liquidation has so far has cost the Securities Investor Protection Corp. $1.3 billion, including $791 million to pay a portion of customers' claims. Mr. Picard has so far made only one distribution in October of $325 million for 1,232 customer accounts. Uncertainty created by the appeals has limited Mr. Picard's ability to distribute recovered funds. Outstanding appeals include the $5 billion Picower settlement and the $1.025 billion settlement. BLUEGREEN CORP: Closes Sale of Bluegreen for $29 Million -------------------------------------------------------- Bluegreen Corporation had completed the sale of its Bluegreen Communities business to Southstar Development Partners, Inc., for a purchase price of $29.0 million in cash and certain other contingent consideration. In connection with the sale, Bluegreen satisfied Communities' debt obligations, primarily its H4BG Communities Facility, which had an outstanding balance of approximately $20.2 million. Bluegreen satisfied this obligation in full, along with accrued interest and a $2.0 million deferred fee. The Company does not expect to recognize a significant gain or loss in connection with the transaction. In addition, the Company does not expect to realize significant net cash proceeds after repayment of the Communities debt, the expenses of the transaction, and the satisfaction of certain liabilities associated with Bluegreen Communities that are remaining with the Company following the transaction. About Bluegreen Corp. Bluegreen Corporation -- http://www.bluegreencorp.com/-- provides places to live and play through its resorts and residential community businesses. Bluegreen reported a net loss attributable to the Company of $17.25 million in 2011, a net loss attributable to the Company of $43.96 million in 2010, and a net loss attributable to the Company of $3.57 million in 2009. The Company's balance sheet at Dec. 31 2011, showed $1.09 billion in total assets, $789.01 million in total liabilities and $308.36 million in total shareholders' equity. * * * In December 2010, Standard & Poor's Rating Services raised its corporate credit rating on Bluegreen Corp to 'B-' from 'CCC'. S&P's rating outlook on the Company is stable. S&P believes that Bluegreen will grow its fee-based sales commission revenue from $20 million in 2009 to an estimated $50 million in 2010. At this time, S&P expects that Bluegreen may be able to generate at least the same amount of commission based revenue in 2011. While the increase in fee- based revenue allowed Bluegreen to expand the level of sales that do not require financing, S&P believes that the company will likely remain heavily reliant on its lines of credit, receivable- backed warehousing facilities, and access to the timeshare securitization markets to fund timeshare sales. In S&P's view, Bluegreen currently has adequate sources of liquidity to cover its needs over the next 12-18 months mainly due to the successful closing of a timeshare securitization transaction. BOWLES SUB: Parcel A Hires Lapp Libra as Bankruptcy Counsel ----------------------------------------------------------- Bowles Sub Parcel A, LLC, seeks Bankruptcy Court permission to employ Ralph V. Mitchell and the law firm of Lapp, Libra, Thomson, Stoebner & Pusch, Chartered, to represent it in connection with all matters relating to its chapter 11 case. The attorneys and paralegal who will provide services and their hourly rates are: $430 per hour for Ralph V. Mitchell, $250 per hour for Tyler D. Candee, $310 per hour for Rosanne H. Wirth, $160 per hour for paralegal services, and the normal hourly rate for other attorneys in the firm. Mr. Mitchell, a shareholder of the firm, disclosed that: (a) Lapp Libra regularly represents Wells Fargo Bank, N.A. and its affiliates. Wells Fargo Bank. N.A. is trustee for the registered holders of J.P. Morgan Chase Commercial Mortgage Securities Corp. Commercial Mortgage Pass-Through Certificates, Series 2004-LN2, the main secured creditor in the Debtor's case. Wells Fargo Bank has advised us that it has virtually no interaction with the borrowers in these types of structured transactions and will play no role in the bankruptcy. Wells Fargo Bank has advised Lapp Libra that it regularly waives any conflict under the circumstances and has similarly waived any conflict with this representation. (b) Lapp Libra filed five additional Chapter 11 cases for affiliates of the Debtor. Lapp Libra does not believe that there are any inter-company claims although all of the six debtors owe debts to affiliates Hoyt Properties, Inc., and Steve Hoyt. Mr. Mitchell attests that Lapp Libra is a "disinterested person" as that term is defined in 11 U.S.C. Sec. 101(14), and does not hold or represent any interest adverse to the Debtor with respect to matters upon which it is to be engaged. Lapp Libra has received no compensation from any party in connection with the case except the Debtor paid Lapp Libra $25,000 as retainer. From the retainer, Lapp Libra has paid the filing fee of $1,046. From the retainer, Lapp Libra has also paid itself for work done prior to the filing from April 17, 2012 through May 8, 2012, in the amount of $1,082. The balance of $21,872 is now being held in Lapp Libra's trust account. About StoneArch II/WCSE Entities StoneArch II/WCSE Minneapolis Industrial LLC in 2007 acquired various limited liability companies, which in turn owned 27 industrial multi-tenant properties located in Minneapolis/St. Paul in Minnesota. The properties were divided into four separate pools: A, B, C, and D. Fenton Sub Parcel D LLC and Bowles Sub Parcel D LLC, which jointly own the properties in pool D, sought Chapter 11 protection (Bankr. D. Minn. Case Nos. 11-44430 and 11-44434) on June 29, 2011. A Chapter 11 plan has been filed for the pool D debtors. The plan, if approved, would allow the existing owners to maintain operation of the properties. Bowles Sub Parcel A, LLC, and five other entities, which jointly own parcels A, B and C, filed for Chapter 11 protection (Bankr. D. Minn. Case Nos. 12-42765, 12-42768, 12-42769, 12-42770, 12-42772, and 12-42774) on May 8, 2012. Each of the May 8 Debtors estimated $10 million to $50 million in assets. The other May 8 debtors are Fenton Sub Parcel A, LLC, Bowles Sub Parcel B, LLC, Fenton Sub Parcel B, LLC, Bowles Sub Parcel C, LLC, and Fenton Sub Parcel C, LLC. Judge Nancy C. Dreher oversees the May 8 Debtors' cases, taking over from Judge Gregory F. Kishel. The May 8 Debtors tapped Lapp Libra Thomson Stoebner & Pusch as counsel. Steven B. Hoyt, as chief manager, signed the Chapter 11 petitions. CAPITOL INFRASTRUCTURE: Judge Allows Capitol to Reject Contracts ---------------------------------------------------------------- Lance Duroni at Bankruptcy Law360 reports that a Delaware bankruptcy judge cleared Capitol Infrastructure LLC on Thursday to reject hundreds of telecommunications contracts, but vowed to protect consumers from an immediate cutoff of their phone and Internet services. Law360 relates that Capitol -- which builds and maintains systems for distributing television, phone and Internet at apartment complexes and other housing developments -- caused an uproar among customers when it sought to quickly reject contracts at 240 properties immediately after filing for bankruptcy two weeks ago, threatening to disrupt communications for thousands of people. About Capitol Infrastructure Capitol Infrastructure, LLC, a Cary, North Carolina-based provider of communication services operating under the name of Connexion Technologies, filed a Chapter 11 petition (Bankr. D. Del. Case No. 12-11362) on April 26, 2012. David M. Fournier, Esq., at Pepper Hamilton LLP, serves as counsel to the Debtor. Prior to the financial crisis that precipitated the Chapter 11 filing, the Debtors served communities with operations in 48 states and had 102,460 video customers, 14,034 voice customers and 47,993 data customers. During the year ended Dec. 31, 2011, the Debtors had 570 full time employees and had annual revenues from its service provider business of $69.2 million. The Debtor estimated up to $10 million in assets and up to $100 million in debts. Capitol concluded earlier in 2012 that its "deteriorating relationship with DirecTV and their overall corporate complexity made it highly unlikely the debtors would be able to obtain adequate financing in a timely fashion," according to its CEO. Capitol is owned by Capitol Broadband LLC, which isn't in bankruptcy. CASCADE BANCORP: Eleven Directors Elected at Annual Meeting ----------------------------------------------------------- Cascade Bancorp held its 2012 annual meeting of shareholders on May 8, 2012. Four proposals were submitted to and approved by the Company's shareholders. The holders of 43,999,374 shares of common stock, 93.06% of the outstanding shares entitled to vote as of the record date, which constituted a quorum, were represented at the meeting in person or by proxy. At the Annual Meeting, the shareholders elected each director nominee to the Board of Directors, namely: (1) Jerol E. Andres; (2) Chris Casciato; (3) Michael Connolly; (4) Henry H. Hewitt; (5) Judith A. Johansen; (6) LaMont Keen; (7) James B. Lockhart III; (8) Patricia L. Moss; (9) Ryan R. Patrick; (10) Thomas M. Wells; and (11) Terry E. Zink. The shareholders ratified the appointment of BDO USA, LLP, as the Company's independent auditor for 2012. The shareholders approved by a non-binding advisory vote the compensation paid to the Company's Named Executive Officers and approved an amendment to the Plan permitting stock awards that would otherwise be paid to a non-employee director for his or her service to be paid to an entity designated by the director. About Cascade Bancorp Bend, Ore.-based Cascade Bancorp (Nasdaq: CACB) through its wholly-owned subsidiary, Bank of the Cascades, offers full-service community banking through 32 branches in Central Oregon, Southern Oregon, Portland/Salem Oregon and Boise/Treasure Valley Idaho. Cascade Bancorp has no significant assets or operations other than the Bank. Weiss Ratings has assigned its E- rating to Bend, Ore.-based Bank of The Cascades. The rating company says that the institution currently demonstrates what it considers to be significant weaknesses and has also failed some of the basic tests it uses to identify fiscal stability. "Even in a favorable economic environment," Weiss says, "it is our opinion that depositors or creditors could incur significant risks." Cascade reported a net loss of $47.27 million in 2011, a net loss of $13.65 million in 2010, and a net loss of $114.83 million in 2009. The Company's balance sheet at March 31, 2012, showed $1.31 billion in total assets, $1.17 billion in total liabilities, and $134.05 million in total stockholders' equity. CATALYST PAPER: Reports $25.6 Million First Quarter Net Loss ------------------------------------------------------------ Catalyst Paper recorded a net loss of $25.6 million in the first quarter of 2012 due primarily to the impact of restructuring and reorganization expenses of $27.6 million. Before specific items, the net loss was $9.6 million. This compared with a net loss of $708.0 million and $41.7 million before specific items in the fourth quarter which was impacted by significant impairment charges on Canadian operations and on Snowflake mill lands, restructuring costs and foreign exchange. Earnings before interest, tax, depreciation and amortization (EBITDA) in the first quarter was $18.1 million and EBITDA before restructuring costs was $23.3 million compared with EBITDA of $2.8 million and EBITDA before restructuring costs of $8.7 million in the prior quarter. "Our first quarter was dominated by restructuring and we focused relentlessly on liquidity and cash flow management," said Catalyst President & CEO Kevin J. Clarke. "We are continuing to work hard with stakeholders to put the necessary fundamentals in place to enable Catalyst to emerge from creditor protection as a stronger and more viable enterprise. At the same time, we are keeping our operations running smoothly. In the first quarter, we achieved production gains and an improved safety record across all mills, maintained a strong order book and reached a new competitive five- year labour agreement at our BC mills which took effect on May 1, 2012." Performance Overview Sales volumes in Q1 were up over the prior quarter due in large part to pulp sales. Sales revenues, however, were down slightly compared with Q4 due to lower transaction prices in pulp and coated grades, the stronger Canadian dollar and lower sales volumes for higher value coated and uncoated specialty grades. Sales revenues improved from a year earlier driven by higher paper and pulp volumes along with marginally higher paper prices. Substantially lower pulp prices offset much of these gains. Operating rates for directory remained strong in the quarter as capacity reductions kept pace with declining demand while newsprint operating rates were similar to the previous year. Mill and machine closures and curtailments helped offset the significant decline in Q1 demand for coated and uncoated specialty grades. Operating costs for the quarter were reduced by the deferral of certain maintenance projects, including a maintenance outage on our pulp assets originally scheduled for March that was moved to April. Our reduced liquidity in the first quarter resulted primarily from compressed vendor credit terms, and restructuring and reorganization costs. The delay in collection of our HST refund claims due to a federal tax audit put further strain on our cash on hand and liquidity. Total liquidity decreased by $99.5 million from the same quarter in the prior year. About Catalyst Paper Catalyst Paper Corp. -- http://www.catalystpaper.com/-- manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With four mills, located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 1.9 million tons. The Company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst on Dec. 15, 2011, deferred a US$21 million interest payment on its outstanding 11.00% Senior Secured Notes due 2016 and Class B 11.00% Senior Secured Notes due 2016 due on Dec. 15, 2011. Catalyst said it was reviewing alternatives to address its capital structures and it is currently in discussions with noteholders. Perella Weinberg Partners served as the financial advisor. In early January 2012, Catalyst entered into a restructuring agreement, which will see its bondholders taking control of the company and includes an exchange of debt for equity. The agreement said it would slash the company's debt by C$315.4 million ($311 million) and reduce its cash interest expenses. Catalyst also said it will continue to "operate and satisfy" its obligations to customers, trade creditors, employees and retirees in the ordinary course of business during the restructuring process. On Jan. 17, 2012, Catalyst applied for and received an initial court order under the Canada Business Corporations Act (CBCA) to commence a consensual restructuring process with its noteholders. Affiliate Catalyst Paper Holdings Inc., filed for creditor protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 12-10219) on the same day and sought recognition of the Canadian proceedings. Catalyst joins a line of paper producers that have succumbed to higher costs, increased competition from Asia and Europe, and falling demand as more advertisers and readers move online. In 2011, Cerberus Capital-backed NewPage Corp. filed for bankruptcy protection, followed by SP Newsprint Co., owned by newsprint magnate and fine art collector Peter Brant. In December, Wausau Paper said it will close its Brokaw mill in Wisconsin, cut 450 jobs and exit its print and color business. The Supreme Court of British Columbia granted Catalyst creditor protection under the CCAA until April 30, 2012. As of Dec. 31, 2011, the Company had C$737.6 million in total assets and C$1.35 million in total liabilities. CHINA SHENGDA: Gets Non-Compliance Notice From NASDAQ ----------------------------------------------------- China Shengda Packaging Group Inc. received a letter from the NASDAQ Stock Market on May 7, 2012 indicating that, for the previous 30 consecutive business days, the bid price of the Company's common stock had closed below the minimum $1.00 per share requirement for continued inclusion on The NASDAQ Global Market under NASDAQ Listing Rule 5450(a)(1). The letter did not indicate the Company's non-compliance with any other listing requirement. The notification has no effect at this time on the listing of the Company's common stock, which will continue to trade on the NASDAQ Global market under the symbol CPGI. The Company has been provided 180 calendar days, or until Nov. 5, 2012, to regain compliance. If at any time before this date the Company's common stock has a closing bid price of $1.00 or more for a minimum of 10 consecutive business days, NASDAQ staff will notify the Company that it has regained compliance. If the Company has not regained compliance by November 5, 2012, it may be eligible for additional time. The Company would be required to meet certain continued listing requirements and the initial listing criteria for The NASDAQ Global Market except for the bid price requirement and will need to provide written notice of its intention to cure its deficiency during the second compliance period. If it meets these criteria, NASDAQ staff will notify the Company that it has been granted an additional 180 day compliance period. If the Company is not eligible for an additional compliance period, NASDAQ will provide the Company with written notification that its common stock will be delisted. At that time, the Company can appeal NASDAQ's determination to delist its common stock to a NASDAQ Hearings Panel. The Company intends to consider all available options to resolve the deficiency and regain compliance with the NASDAQ minimum bid price requirements. In addition, the Company intends to explore other options for the listing of its common stock. About China Shengda China Shengda Packaging Group Inc. -- http://www.cnpti.com/-- is a packaging company in China. It is principally engaged in the design, manufacturing and sale of flexo-printed and color-printed corrugated paper cartons in a variety of sizes and strengths. It also manufactures corrugated paperboards, which are used for the production of its flexo-printed and color-printed cartons. The company provides paper packaging solutions to a wide variety of industries, including food, beverage, cigarette, household appliance, consumer electronics, pharmaceuticals, chemicals, machinery and other consumer and industrial sectors in China. CINRAM INT'L: Lenders Agree to Extend Waiver to May 30 ------------------------------------------------------ Cinram International Income Fund on May 1, 2012 the Fund disclosed that its first and second lien senior lenders agreed to extend their waiver of certain financial covenants, consistent with previously granted and disclosed waivers. These waivers were extended to May 30, 2012 but can be terminated under certain circumstances by the lenders on or after May 15, 2012. About Cinram International With headquarters in Toronto, Ontario, Canada, Cinram International Inc. is one of the world's largest independent manufacturers, replicators and distributors of DVDs and audio CDs. In April 2012 Standard & Poor's Ratings Services lowered its ratings on Cinram International, including its long-term corporate credit rating on the company to 'CC' from 'CCC'. "We base the downgrade on what we view as Cinram's weak liquidity position and poor operating performance, with reported revenue and EBITDA dropping 28% and 79% in 2011, compared with 2010, which resulted in the company's need for waivers to its financial covenants. Furthermore, Cinram is in discussions with a number of counterparties concerning strategic alternatives for the business, which we believe could lead to a debt restructuring given the ongoing deterioration in its business. A distressed debt restructuring would constitute an event of default under our criteria," S&P said. CONTRACT RESEARCH: Has Approval for Settlement, Loan and Bonuses ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Contract Research Solutions Inc. accomplished three objectives at a May 9 hearing in U.S. Bankruptcy Court in Delaware: * The court approved a global settlement with the creditors' committee allowing lenders to buy the business without objection from unsecured creditors. The settlement provides that the lenders won't use their secured deficiency claims to take any part of the $1.5 million carved out for unsecured creditors. * The judge also approved a bonus program for company executives, along with final financing for the Chapter 11 case. The settlement carves out $1.5 million for payment to holders of unsecured claims or other uses the committee finds necessary. * The judge also gave final approval for $15 million in financing provided by the secured lenders. The loan agreement calls for converting $15 million in pre-bankruptcy debt into an obligation of the company in reorganization. As part of the settlement, the committee agreed not to oppose final financing approval. According to the report, the bonus program would pay executives $1.3 million if the business is sold to first-lien lenders under the agreement worked out before bankruptcy. Cetero admitted that the proposed bonuses have "some retentive effect." The company was referring to a provision added to bankruptcy law in 2005 in which Congress banned retention bonuses to senior executives of bankrupt companies. About Cetero Contract Research Solutions Inc., doing business as Cetero, a provider of early-phase clinical research services for pharmaceutical and biotechnology firms, filed a Chapter 11 petition (Bankr. D. Del. Case No. 12-11004) on March 26, 2012. Cetero's 19 affiliates also sought bankruptcy protection (Bankr. D. Del. Case Nos. 12-11005 to 12-11023). Cetero plans to sell the business, including their rights to pursue avoidance actions, to first-lien secured lenders in exchange for $50 million in debt, absent higher and better offers. Cetero has filed a motion seeking approval of procedures that will govern the bidding and auction. The first-lien lenders have formed entities that will acquire the business -- CSRI Holdings LLC, as U.S. Purchaser, and 0935867 B.C. Ltd and 0935870 B.C. Ltd, as Canadian Purchasers. Together, they will serve as stalking horse bidders and have offered to exchange $50 million in secured debt and assume $30 million in liabilities to buy the assets. First lien lenders are also providing a $15 million loan to finance the Chapter 11 effort. The procedures require that the bidding protocol be approved by April 12 and an auction be held between April 30 and May 5. Competing bids are due three days prior to the auction date. The hearing for approval of the sale must take place prior to May 10. Assets are $205 million, with debt total $248 million. There is $185 million in debt for borrowed money, including $116 million on a first-lien term loan and revolving credit. The second-lien loan is $25 million. Second-lien lenders have agreed to the sale. Freeport Financial LLC serves as the sole lead arranger and bookrunner, and as U.S. administrative agent and collateral agent under the first lien facility. Bank of Montreal serves as the Canadian agent. Freeport is also the agent under the second lien facility. Judge Kevin Gross oversees the case. Lawyers at Young Conaway Stargatt & Taylor, LLP, and Paul Hastings LLP serve as the Debtors' counsel. Stikeman Elliott LLP serves as Canadian counsel. Carl Marks Advisory Group LLC serves as restructuring advisor. Epiq Bankruptcy Solutions serves as claims and notice agent. Jefferies & Company Inc. serves as financial advisors. The petitions were signed by Michael T. Murren, CFO. The first lien lenders and the stalking horse buyers are represented by Peter Knight, Esq., at Latham & Watkings, LLP; and Wael Rostom, Esq., at McMillan LLP. Roberta A. Deangelis, U.S. Trustee for Region 3 appointed three persons to the Official Committee of Unsecured Creditors in the Chapter 11 cases of Contract Research Solutions, Inc., et al. The Committee tapped Morris Anderson & Associates, Ltd., as its financial advisors. Cetero will hold an auction on May 15 to learn whether anyone will beat an offer from first-lien lenders to buy the business in exchange for $50 million in debt. The sale will have the lenders assume $30 million in liabilities while providing for the payment of costs of the Chapter 11 case, along with liabilities entitled to priority. CORBIN PARK: BAP Says Mortgagee Has Priority Over Mechanic's Lien ----------------------------------------------------------------- The U.S. Bankruptcy Appellate Panel for the Tenth Circuit affirmed the bankruptcy court's order determining that, under Kansas law, the interest of a construction lender/mortgagee in a retail shopping center development has priority over their mechanic's lien claims. Two general contractors and four subcontractors took an appeal from the ruling. The Tenth Circuit BAP held that the bankruptcy court committed no reversible error in determining the priority of interests between the claimants, and Bank of America's mortgage has priority over the contractors' mechanic's liens. The contractors and subcontractors are Brown Commercial Construction Company, O'Donnell & Sons Construction Company, ARR Roofing LLC, doing business as Boone Brothers Roofing, Wachter Electric Company, McCorkendale Construction, Inc., and Ball Kelly LLC. A copy of the Tenth Circuit BAP's decision dated May 7, 2012, is available at http://is.gd/9xSj10from Leagle.com. About Corbin Park Corbin Park, L.P., owns a large portion of a partially developed 97-acre shopping center known as "Corbin Park", which is located at the intersection of Metcalf Avenue and West 135th Street in Overland Park, Kansas. The Debtor acquired the Property from previous owners and developers State Line LLC and 135 Metcalf LLC. Invesco Ltd., investing at least $38 million, and Metcalf's in- house agent Cormac formed Corbin Park to purchase the Property. Bank of America agreed to advance up to $107 million in construction loans to Corbin Park. Based in Omaha, Nebraska, Corbin Park sought Chapter 11 protection (Bankr. D. Kan. Case No. 10-20014) on Jan. 5, 2010. Carl R. Clark, Esq., and Jeffrey A. Deines, Esq., at Lentz Clark Deines PA, represent the Debtor. The Debtor estimated $50 million to $100 million in assets and $10 million to $50 million in debts as of the Petition Date. DELTA PETROLEUM: Court Approves Laramie as Plan Sponsor ------------------------------------------------------- Delta Petroleum Corporation obtained U.S. Bankruptcy Judge Kevin J. Carey's approval of Delta's choice of Laramie Energy II, LLC as the sponsor of a plan of reorganization to be proposed by Delta. Laramie and Delta have entered into a non-binding term sheet describing a transaction by which Laramie and Delta will form a new joint venture, Piceance Energy LLC Piceance Energy, whose assets will comprise Laramie's and Delta's Piceance Basin assets, will be owned 66.66% by Laramie, and 33.34% by a newly reorganized Delta Petroleum. In addition to the 33.34% membership interest, Piceance Energy will distribute $75 million to Reorganized Delta. The $75 million in cash proceeds will be used to pay the Company's bankruptcy expenses and to repay secured debt. Reorganized Delta will retain the Company's interest in the Point Arguello unit of offshore California, other miscellaneous assets, and certain tax attributes. It is anticipated that the common stock of Reorganized Delta will be owned by the Company's creditors. The Company's current shareholders are not expected to receive any consideration under the reorganization plan as currently contemplated. About Delta Petroleum Delta Petroleum Corporation (NASDAQ: DPTR) 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. In its amended schedules, the Delta Petroleum disclosed $373,836,358 in assets and $312,864,788 in liabilities. W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A. Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard & Reed LLP, in New York, N.Y., 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' restructuring advisor. Evercore Group L.L.C. is the financial advisor and investment banker. 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. Delta will hold an auction for the business on March 26, 2012. No buyer is under contract. There is $57.5 million in financing for the Chapter 11 effort. The U.S. Trustee told the bankruptcy judge that there was insufficient interest from creditors to form an official committee of unsecured creditors. DEX ONE: Seven Directors Elected at Annual Meeting -------------------------------------------------- Dex One Corporation held its annual meeting of stockholders on May 8, 2012. At the meeting, Dex One stockholders elected seven individuals to the Board of Directors to serve until Dex One's 2013 Annual Meeting of Stockholders and until their respective successors are duly elected and qualified or until their earlier resignation or removal. The newly elected directors are: (1) Jonathan B. Bulkeley; (2) Eugene I. Davis; (3) Richard L. Kuersteiner; (4) W. Kirk Liddell; (5) Mark A. McEachen; (6) Alfred T. Mockett; and (7) Alan F. Schultz. The stockholders approved, on an advisory basis, Dex One's executive compensation and ratified the appointment of KPMG LLP as Dex One's independent registered public accounting firm for 2012. About Dex One Dex One, headquartered in Cary, North Carolina, is a local business marketing services company that includes print directories and online voice and mobile search. Revenue was approximately $1.1 billion for the LTM period ended Sept. 30, 2010. R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media East LLC, Dex Media West LLC and Dex Media Inc., filed for Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09- 11833 through 09-11852). They emerged from bankruptcy on Jan. 29, 2010. On the Effective Date and in connection with its emergence from Chapter 11, RHD was renamed Dex One Corporation. Dex One reported a net loss of $518.96 million in 2011 compared with a net loss of $923.59 million for the eleven months ended Dec. 31, 2010. The Company's balance sheet at March 31, 2012, showed $3.14 billion in total assets, $3.09 billion in total liabilities and $48.87 million in total shareholders' equity. * * * As reported in the April 2, 2012 edition of the TCR, Moody's Investors Service has downgraded the corporate family rating (CFR) for Dex One Corporation's to Caa3 from B3 based on Moody's view that a debt restructuring is inevitable. Moody's has also changed Dex's Probability of Default Rating (PDR) to Ca/LD from B3 following the company's purchase of about $142 million of par value bank debt for about $70 million in cash. The Caa3 rating also reflects Moody's view that additional exchanges at a discount are likely in the future since the company amended its bank covenants to make it possible to repurchase additional bank debt on the open market through the end of 2013. As reported by the TCR on April 4, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Cary, N.C.-based Dex One Corp. and related entities to 'CCC' from 'SD' (selective default). "The upgrade reflects our assessment of the company's credit profile after the completion of the subpar repurchase transaction in light of upcoming maturities, future subpar repurchases, and our expectation of a continued week operating outlook," explained Standard & Poor's credit analyst Chris Valentine. DOLLAR THRIFTY: Moody's Raises CFR/PDR to 'B1'; Outlook Stable -------------------------------------------------------------- Moody's Investors Service raised the Corporate Family and Probability of Default Ratings (CFR and PDR) of Dollar Thrifty Automotive Group, Inc. to B1 from B2. The upgrade reflects Moody's expectation that the company will be able to sustain credit metrics that are solidly supportive of the B1 rating level as a result of its strong position in the value segment of the daily car rental market, favorable industry fundamentals, and a prudent financial strategy. The rating also anticipates that the company will maintain an adequate liquidity profile. Ratings Rationale Notwithstanding these positive factors, the B1 rating also recognizes that Dollar could pursue share repurchases or other shareholder-friendly actions that could increase leverage or narrow the current liquidity position. However, Dollar has a very efficient operating structure and competitive returns. In addition, its capital structure, unlike that of other peers, includes only fleet debt and has no burdensome corporate debt. As a result, its credit metrics are very strong for the B1 rating level. Although, shareholder friendly actions would weaken these measures from their currently robust levels, Moody's expects that they would be measured and would enable Dollar to maintain credit metrics that are consistent with the B1 rating. The Speculative Grade Liquidity rating is SGL-3 and the rating outlook is stable. The stable outlook reflects the company's highly competitive position in the daily car rental market and strong credit metrics balanced against the potential for measured shareholder-friendly actions that might be undertaken. Dollar's liquidity position is supported by a $450 million secured credit facility that matures during 2017. After letter of credit usage, availability under the facility is about $300 million. Dollar's cash position approximates $500 million. In addition, the company has capacity of $420 million under its VFN facility with a revolving usage period extending to October 2013. These liquidity sources, amounting to approximately $1.2 billion provide adequate coverage for the company's fleet purchase requirements and the approximately $500 million in debt maturing during the coming twelve months. Important industry fundamentals that support the B1 rating are the discipline fleet management strategies being employed by the major car rental companies and the strong used car market. Although pricing within the sector will remain competitive, the resistance to over fleeting by the rental companies and the healthy used car market should support adequate return measures. Dollar's rating would be considered for further positive action only after there is greater clarity with respect to the company's long-term financial strategy, particularly relating to dividend and share repurchase levels, and the level of corporate debt the company might carry. Credit metric levels that could support positive movement in the rating include EBIT/Interest approximating 2.25x, debt/EBITDA in the area of 2.75x, and retained cash flow to debt of 25%. Any upward movement in the rating would also be contingent upon the preservation of a sound liquidity position. The most likely source of stress on the rating would come from an aggressive dividend or share repurchase strategy. Metric levels that might indicate pressure on the rating include EBIT/Interest approximating 1.25x and debt/EBITDA in the area of 4x. The Hertz Corporation (CFR B1 under review for possible downgrade) may proceed with an attempt to acquire Dollar. Moody's does not anticipate that an acquisition by Hertz would result in any erosion in the risk posed to Dollar's current debt-holders due to change of control provisions. Nevertheless, if Hertz resubmits an offer for Dollar, the company's rating would be reassessed based on the terms of the proposal. The Hertz Corporation (CFR B1 under review for possible downgrade) had made a prior unsuccessful offer to acquire Dollar, and could proceed to make a future bid for the company. Moody's notes that Dollar's bank credit facility contains a change of control provision that would likely result in a termination of the facility and require repayment of any outstandings in the event that Hertz were to acquire the company. Consequently, while Moody's does not anticipate that an acquisition by Hertz would pose any additional risk to the facility, Dollar's rating would be reassessed based on the terms of any new offer. The principal methodology used in rating Dollar Thrifty Automotive Group was the Global Equipment and Automotive Rental Industry Methodology published in December 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. ECOSPHERE TECHNOLOGIES: Files Form 10-Q; Posts $746,781 Q1 Loss --------------------------------------------------------------- Ecosphere Technologies, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $746,781 on $8.36 million of total revenues for the three months ended March 31, 2012, compared with a net loss of $3.74 million on $2.22 million of total revenues for the same period during the prior year. The Company reported a net loss of $5.86 million in 2011, a net loss of $22.66 million in 2010, and a net loss of $19.05 million in 2009. The Company's balance sheet at March 31, 2012, showed $10.69 million in total assets, $5.33 million in total liabilities, $4 million in total redeemable convertible cumulative preferred stock, and $1.35 million in total equity. A copy of the Form 10-Q is available for free at: http://is.gd/ab4Fol About Ecosphere Technologies Stuart, Fla.-based Ecosphere Technologies, Inc. (OTC BB: ESPH) -- http://www.ecospheretech.com/-- is a diversified water engineering, technology licensing and environmental services company that designs, develops and manufactures wastewater treatment solutions for industrial markets. Ecosphere, through its majority-owned subsidiary Ecosphere Energy Services, LLC ("EES"), provides energy exploration companies with an onsite, chemical free method to kill bacteria and reduce scaling during fracturing and flowback operations. ELEPHANT TALK: Incurs $6 Million Net Loss in First Quarter ---------------------------------------------------------- Elephant Talk Communications Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $6 million on $8.58 million of revenue for the three months ended March 31, 2012, compared with a net loss of $4.71 million on $8.50 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2012, showed $54.23 million in total assets, $21.95 million in total liabilities and $32.28 million in total stockholders' equity. A copy of the Form 10-Q is available for free at: http://is.gd/NhfKPL About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. The Company reported a net loss of $25.31 million in 2011, a net loss of $92.48 million in 2010, and a net loss of $17.29 million in 2009. ELEPHANT TALK: Files Form S-3, Registers 90.4-Mil. Common Shares ---------------------------------------------------------------- Elephant Talk Communications, Corp., filed with the U.S. Securities and Exchange Commission a Form S-3 relating to the sale and other disposition of an aggregate of 23,421,704 shares of common stock of the Company, issuable upon exercise of the following warrants: (a) an aggregate of 10,571,368 warrants issued by the Company to certain parties on Sept. 30, 2008; (b) an aggregate of 7,677,385 warrants issued by the Company to certain parties on Aug. 18, 2008; (c) an aggregate of 3,829,286 warrants issued by the Company to certain parties on March 17, 2010; (d) 75,000 and 18,859 warrants to certain parties on Jan. 4, 2011, and Feb. 23, 2012, respectively; and (e) an aggregate of 1,249,806 warrants issued at various times to QAT II Investments SA. This prospectus also relates to the sale of up to a total of 67,061,083 shares of common stock that may be sold from time to time by CMV II Invest CVA, Herman Spliethoff, Albert Poliak, et al. The selling stockholders may sell all or a portion of the shares of common stock held by them from time to time directly or through one or more broker-dealers or agents. If the shares of common stock are sold through broker-dealers or agents, the selling stockholders will be responsible for underwriting discounts or commissions or agent's commissions. The Company's common stock is quoted on the NYSE Amex under the symbol "ETAK". The closing price for the Company's common stock on May 4, 2012, was $1.90 per share. A copy of the prospectus is available for free at: http://is.gd/1Iy48u About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. The Company reported a net loss of $25.31 million in 2011, a net loss of $92.48 million in 2010, and a net loss of $17.29 million in 2009. The Company's balance sheet at March 31, 2012, showed $54.23 million in total assets, $21.95 million in total liabilities and $32.28 million in total stockholders' equity. EMERALD PERFORMANCE: Upsized Loan No Impact on Moody's 'B2' CFR --------------------------------------------------------------- Moody's Investors Service said the $30 million increase in Emerald Performance Holding Group, LLC's term loan to $300 million from $270 million will not affect the firm's Corporate Family Rating (CFR) or term loan rating. The principal methodology used in rating Emerald Performance Holding Group, LLC was the Global Chemical Industry Methodology, published in December 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. As reported by the Troubled Company Reporter-Europe on April 24, 2012, Moody's assigned a first time B2 Corporate Family Rating (CFR) to Emerald Performance Holding Group, LLC and a B1 rating to its proposed six-year $270 million Term Loan. Proceeds from the new term loan are expected to be used to refinance the company's current term loan facility due in 2013, repay the outstanding balance on the revolver, and for expenses. The outlook is stable. The following summarizes the ratings activity: Emerald Performance Holding Group, LLC Ratings assigned: Corporate family rating -- B2 Probability of default rating -- B2 Outlook: Stable Emerald Performance Materials, LLC $270 million Sr Sec 1st Lien Term Loan due 2018 -- B1 (LGD3, 36%) Outlook: Stable Emerald Performance Holding Group, LLC, headquartered in Cuyahoga Falls, Ohio, is a producer of specialty chemicals used in a wide range of food and industrial applications. The company is owned by funds managed by Sun Capital Partners Inc., and reported sales of roughly $665 million for 2011. EMMIS COMMUNICATIONS: Swings to $79.5-Mil. Net Income in 2011 ------------------------------------------------------------- Emmis Communications Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net income attributable to common shareholders of $79.49 million on $236 million of net revenues for the year ended Feb. 29, 2012, compared with a net loss attributable to common shareholders of $25.26 million on $250.75 million of net revenues for the year ended Feb. 28, 2011. The Company's balance sheet at Feb. 29, 2012, showed $340.76 million in total assets, $347.28 million in total liabilities, $46.88 million in series A cummulative convertible preferred stock, and a $53.39 million total deficit. A copy of the Form 10-K is available for free at: http://is.gd/VGigNI About Emmis Communications Headquartered in Indianapolis, Indiana, Emmis Communications Corporation -- http://www.emmis.com/-- owns and operates 22 radio stations serving New York, Los Angeles, Chicago, St. Louis, Austin, Indianapolis, and Terre Haute, as well as national radio networks in Slovakia and Bulgaria. The company also publishes six regional and two specialty magazines. * * * Emmis carries Caa2 corporate family rating and a Caa3 probability of default rating from Moody's. In July 2011, Moody's Investors Service placed the ratings of Emmis on review for possible upgrade following the company's earnings release for 1Q12 (ended May 31, 2011) including additional disclosure related to the pending sale of controlling interests in three radio stations. The sale of the majority ownership to GCTR will generate estimated net proceeds of approximately $100 million to $120 million, after taxes, fees and related expenses. Emmis will retain a minority equity interest in the operations of the three stations and Moody's expects senior secured debt to be reduced resulting in improved credit metrics. ENTREMED INC: Regains Compliance With Equity Listing Requirement ---------------------------------------------------------------- EntreMed, Inc. has received notice from the Nasdaq Stock Market indicating that, based on the Company's completed financing described in the Company's Form 8-K dated May 4, 2012, the NASDAQ staff has determined that the Company complies with Listing Rule 5550(b). The Company was previously notified that it was not in compliance with Nasdaq Listing Rule 5550(b) and was granted an extension until May 21, 2012 to comply. Listing Rule 5550(b) requires listed companies to have a minimum $2,500,000 stockholders' equity, $35,000,000 market value of listed securities, or $500,000 net income from continuing operations. In accordance with NASDAQ Marketplace Rules, NASDAQ will continue to monitor the Company's ongoing compliance with Rule 5550(b) and will require the Company to evidence compliance upon filing its periodic report for the quarter ending June 30, 2012, or it may be subject to delisting which can be appealed. Dr. Ken Ren commented, "The Company is now in compliance, and we expect and are confident that we will remain compliant upon filing our Form 10-Q for the quarter ending June 30, 2012. As we execute on our clinical initiatives, compliance with NASDAQ listing requirements continues to be part of our long-term plans." About EntreMed EntreMed, Inc. -- http://www.entremed.com/-- is a clinical-stage pharmaceutical company committed to developing ENMD-2076, a selective angiogenic kinase inhibitor, for the treatment of cancer. E NMD-2076 is currently completing a multi-center Phase 2 study in ovarian cancer and completed several Phase 1 studies in solid tumors, multiple myeloma, and leukemia. EPICEPT CORP: Incurs $4.7 Million Net Loss in First Quarter ----------------------------------------------------------- EpiCept Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to common stockholders of $4.70 million on $241,000 of revenue for the three months ended March 31, 2012, compared with a net loss attributable to common stockholders of $2.46 million on $238,000 of revenue for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $6.16 million in total assets, $23.30 million in total liabilities and a $17.14 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/1F9qNx About EpiCept Corporation Tarrytown, N.Y.-based EpiCept Corporation (Nasdaq and Nasdaq OMX Stockholm Exchange: EPCT) -- http://www.epicept.com/-- is focused on the development and commercialization of pharmaceutical products for the treatment of cancer and pain. The Company's lead product is Ceplene(R), approved in the European Union for the remission maintenance and prevention of relapse in adult patients with Acute Myeloid Leukemia (AML) in first remission. In the United States, a pivotal trial is scheduled to commence in 2011. The Company has two other oncology drug candidates currently in clinical development that were discovered using in-house technology and have been shown to act as vascular disruption agents in a variety of solid tumors. The Company's pain portfolio includes EpiCept(TM) NP-1, a prescription topical analgesic cream in late-stage clinical development designed to provide effective long-term relief of pain associated with peripheral neuropathies. Epicept reported a net loss of $15.65 million in 2011, a net loss of $15.53 million in 2010, and a net loss of $38.81 million in 2009. For 2011, Deloitte & Touche LLP, in Parsippany, New Jersey, noted that the Company's recurring losses from operations and stockholders' deficit raise substantial doubt about its ability to continue as a going concern. GEOMET INC: Transfers Listings to the NASDAQ Capital Market ----------------------------------------------------------- GeoMet, Inc. disclosed that its application to transfer the listing of its common stock and preferred stock from The NASDAQ Global Market to The NASDAQ Capital Market has been approved by NASDAQ. The transfers will be effective at the opening of business on May 14, 2012. The Company's common stock and preferred stock will continue to trade under the symbols "GMET" and "GMETP", respectively. The Company has been advised by NASDAQ that it has until Aug. 1, 2012 to regain compliance with the minimum bid price rule for its common stock while listed on The NASDAQ Capital Market. On, or prior to this date, the bid price of the Company's common stock must close at $1.00 per sha re or more for a minimum of ten (10) consecutive business days. If compliance is not regained, and the Company does not receive an extension of the deadline for compliance, the Company's common and preferred shares will be subject to delisting. About GeoMet, Inc. GeoMet, Inc. is an independent energy company primarily engaged in the exploration for and development and production of natural gas from coal seams and non-conventional shallow gas. Its principal operations and producing properties are located in Alabama, West Virginia and Virginia. GEORGE VAN WAGNER: Ch. 7 Trustee Didn't Abandon Causes of Action ---------------------------------------------------------------- Chief District Judge John Preston Bailey affirmed these decisions of the United States Bankruptcy Court for the Northern District of West Virginia: (1) a Nov. 22, 2010, order finding that certain causes of action had not been abandoned by the trustee of George Van Wagner's bankruptcy estate; (2) three Aug. 1, 2011, orders settling claims in various bankruptcy proceedings; and (3) two Aug. 11, 2011, orders granting motions to expunge notices of lis pendens. Mr. Van Wagner took the appeal. The matter stems from the Chapter 7 bankruptcy cases commenced by Mr. Van Wagner and hits affiliated companies. On Sept. 24, 2007, Hickory Ridge, LLC, filed a Chapter 7 bankruptcy petition with the United States Bankruptcy Court for the Northern District of West Virginia. Robert Trumble was appointed Chapter 7 trustee for Hickory Ridge. Vanwood LLC filed a Chapter 7 bankruptcy petition on Dec. 27, 2007, with the Bankruptcy Court. Mr. Trumble was appointed trustee of Vanwood's estate. On March 28, 2008, George Van Wagner filed a voluntary Chapter 11 petition with the Bankruptcy Court, which was converted to a Chapter 7 proceeding on July 1, 2009. Thomas Fluharty was appointed the trustee of Mr. Van Wagner's estate. Mr. Van Wagner filed two civil lawsuits in the Circuit Court of Berkeley County, West Virginia, alleging the Chapter 7 trustee of his personal estate had abandoned certain causes of action and business interests. In the state civil proceedings, Mr. Van Wagner asserted rights on behalf of himself, Hickory Ridge, or Vanwood. The appellate case is GEORGE VAN WAGNER, Plaintiff, v. ATLAS TRI- STATE SPE, LLC, et al., Defendants, Civil Action No. 3:11-CV-75 (N.D. W.Va.). A copy of the Court's May 8, 2012 Memorandum Opinion is available at http://is.gd/nmUsACfrom Leagle.com. GMX RESOURCES: Files Form 10-Q, Incurs $37.8MM Net Loss in Q1 ------------------------------------------------------------- GMX Resources Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $37.87 million on $17.40 million of oil and gas sales for the three months ended March 31, 2012, compared with a net loss of $51.82 million on $29.37 million of oil and gas sales for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $502.38 million in total assets, $468.47 million in total liabilities and $33.91 million in total equity. A copy of the Form 10-Q is available for free at: http://is.gd/Kme50g About GMX Resources GMX Resources Inc. -- http://www.gmxresources.com/-- is an independent natural gas production company headquartered in Oklahoma City, Oklahoma. GMXR has 53 producing wells in Texas & Louisiana, 24 proved developed non-producing reservoirs, 48 proved undeveloped locations and several hundred other development locations. GMXR has 9,000 net acres on the Sabine Uplift of East Texas. GMXR has 7 producing wells in New Mexico. The Company's strategy is to significantly increase production, revenues and reinvest in increasing production. GMXR's goal is to grow and build shareholder value every day. The Company reported net losses of $206.44 million in 2011, $138.29 million in 2010, and $181.08 million in 2009. * * * In November 2011, Moody's downgraded the rating of GMX Resources' corporate family rating (CFR) to 'Caa3' from 'Caa1', the Probability of Default (PDR) rating to 'Ca' from 'Caa1', and the Speculative Grade Liquidity (SGL) rating to SGL-4 from SGL-3. The outlook is negative. The downgrade of GMX's PDR and note ratings reflect the company's announcement that greater than 50% of the holders of the notes due 2019 have accepted a proposed exchange offer, which Moody's views as a distressed exchange. The lowering of the CFR and SGL ratings reflects Moody's expectation of potential liquidity issues through the first quarter of 2013, as well as elevated leverage following the issuance of at least $100 million of proposed secured notes under the exchange offer and a proposed $55 million volumetric production payment (VPP), both of which the company expects to be executed before the end of 2011. Moody's treats VPPs as debt in Moody's leverage calculations. The negative outlook reflects the potential for the CFR and note ratings to be lowered if liquidity deteriorates further. As reported by the TCR on Dec. 21, 2011, Standard & Poor's Ratings Services lowered its corporate credit rating on GMX Resources Inc. to 'SD' (selective default) from 'CC'. "We also lowered the company's issue-level ratings to 'D' from 'CC', reflecting its completion of an exchange offer for a portion of its $200 million 11.375% senior notes due 2019," S&P said. "The rating actions follow the company's announcement that it has completed the exchange offer for its 11.375% senior notes due 2019," said Standard & Poor's credit analyst Paul B. Harvey. "The exchange offer included $53 million principle of 11.375% senior notes that accepted an exchange of $1,000 principle for $750 principle of new 11% senior secured notes due 2017. We consider the completion of such an exchange, at a material discount to par, to be a distressed exchange and, as such, tantamount to a default under our criteria." GREENMAN TECHNOLOGIES: Gregory Ho Discloses 39.5% Equity Stake -------------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission, Gregory P. Ho and his affiliates disclosed that, as of April 30, 2012, they beneficially own 23,266,664 common shares of Greenman Technologies, Inc., representing 39.5% of the shares outstanding. A copy of the filing is available for free at: http://is.gd/vC7pKE About Greenman Technologies Lynnfield, Mass.-based GreenMan Technologies, Inc. (OTC QB: GMTI) through its two alternative energy subsidiaries, American Power Group, Inc. ("APG") and APG International, Inc. ("APGI"), provides a cost-effective patented dual fuel conversion technology for diesel engines and diesel generators. The Company reported a net loss of $6.81 million for the year ended Sept. 30, 2011, compared with a net loss of $5.64 million the year before. The Company's balance sheet at Dec. 31, 2011, showed $3.68 million in total assets, $7.03 million in total liabilities, and a $3.34 million total stockholders' deficit. For Fiscal 2011, the Company's independent auditors expressed substantial doubt about the Company's ability to continue as a going concern. Schechter Dokken Kanter Andrews & Selcer, Ltd., in Minneapolis, Minnesota, noted in its report that the Company has continued to incur substantial losses from operations, has not generated positive cash flows and has insufficient liquidity to fund its ongoing operations. GUSHAN ENVIRONMENTAL: Gets NYSE Notice of Non-Compliance -------------------------------------------------------- Gushan Environmental Energy Limited received a letter from the New York Stock Exchange notifying the Company that it was not in compliance with one of the NYSE's standards for continued listing of the Company's American depositary shares on the exchange. Specifically, the NYSE indicated that it considers the Company to be "below criteria" because, as of Dec. 31, 2011, its average global market capitalization over a consecutive 30 trading-day period was less than $50 million and, at the same time, its total stockholders' equity was less than $50 million. On April 27, 2012, the Company reported that as of Dec. 31, 2011, its total shareholders' equity attributable to the Company was approximately $36.2 million. As of Dec. 31, 2011, the Company's global market capitalization over a consecutive 30 trading-day period was $27.5 million. Under NYSE continued listing rules, the Company has 90 days from the receipt of the letter to submit a plan advising the NYSE of definitive action the Company has taken, or is taking, that would bring it into conformity with the applicable standards within 18 months of receipt of the letter. If the NYSE staff determines that the Company has not made a reasonable demonstration of an ability to come into conformity with the applicable standards within 18 months, the NYSE staff will promptly initiate suspension and delisting procedures. Otherwise, if the NYSE staff accepts the plan, the Company will be subject to semi-annual review by the NYSE staff for compliance with this plan until either the Company is able to demonstrate that it has returned to compliance for a period of two consecutive quarters or the expiration of the 18 month period. The NYSE staff will promptly initiate suspension and delisting procedures if the Company fails to meet the continued listing standards at the end of the 18 month period. The Company currently intends to submit such a plan and is exploring alternatives for curing the deficiency and regaining compliance with the NYSE's continued listing standards. The Company's business operations and Securities and Exchange Commission reporting requirements are unaffected by this letter. The Company's ADSs will remain listed on the NYSE under the symbol GU but will be assigned a ".BC" indicator by the NYSE to signify that the Company is currently not in compliance with the NYSE's continued listing standards. About Gushan Environmental Gushan Environmental Energy Limited produces biodiesel, a renewable, clean-burning and biodegradable fuel and a raw material used to produce chemical products, primarily from used cooking oil, and by-products from biodiesel production, including glycerine and plant asphalt. Gushan sells biodiesel directly to users, such as marine vessel operators and chemical factories, as well as to petroleum wholesalers and individual retail gas stations. The Company has seven production facilities, located in the Sichuan, Hebei, Fujian and Hunan provinces and in Beijing, Shanghai and Chongqing, with a combined annual production capacity of 490,000 tons. Gushan's Sichuan production facility is currently in operation. Gushan also operates a copper products business in China which manufactures copper rods, copper wires, copper granules and copper plates primarily from recycled copper. Currently, the copper products business has two plants, with a daily production capacity of approximately 210 tons of recycled copper products. HALO COMPANIES: Whitley Penn Succeeds Montgomery as Accountants --------------------------------------------------------------- Halo Companies, Inc., dismissed Montgomery, Coscia, Greilich LLP as its independent registered public accounting firm and appointed Whitley Penn, LLP, as the Company's new independent registered public accounting firm. The Board of Directors of the Company approved the change of independent registered public accounting firms. MCG's independent auditor's report dated March 30, 2012, furnished in connection with the Company's annual report on Form 10-K for the period ended Dec. 31, 2011, and MCG's independent auditor's report dated March 31, 2011, furnished in connection with the Company's annual report on Form 10-K for the period ended Dec. 31, 2010, did not include an adverse opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principles, except that each such independent auditor's report contained an qualification raising substantial doubt about the Company's ability to continue as a going concern. During the Company's most recent fiscal year and the subsequent interim period prior to May 10, 2012, there were no disagreements with MCG on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of MCG, would have caused it to make reference to the matter thereof in connection with its report. Prior to the appointment of WP as the Company's independent registered public accounting firm, neither the Company nor anyone acting on its behalf consulted with WP regarding either (a) the application of accounting principles to a specific completed or contemplated transaction, or the type of audit opinion that might be rendered on the Company's financial statements, and neither a written report or oral advice was provided to the Company that WP concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue, or (b) any matter that was the subject of a disagreement identified in response to Item 304(a)(1)(iv) of Regulation S-K and the related instructions or an event identified in response to Item 304(a)(1)(v) of Regulation S-K. About Halo Companies Allen, Texas-based Halo Companies, Inc., is a nationwide real estate investment, asset management and financial services company that provides technology and asset management solutions to asset owners as well as real estate and financial services to financially distressed consumers which can be applied individually or utilized as a comprehensive workout strategy. Halo Companies reported a net loss of $2.50 million in 2011, compared with a net loss of $3.63 million in 2010. The Company's balance sheet at Dec. 31, 2011, showed $1.63 million in total assets, $4.32 million in total liabilities, and a $2.69 million total shareholders' deficit. For the year ended Dec. 31, 2011, Montgomery Coscia Greilich LLP, in Plano, Texas, expressed substantial doubt about the ability of the Company to continue as a going concern. The independent auditors noted that Halo Companies, Inc., has incurred losses since its inception and has not yet established profitable operations. HARRISBURG, PA: Officials Seek to Halt State Receivership Case -------------------------------------------------------------- Elected officials of Harrisburg, Pa., asked a judge to suspend the state's takeover of city finances until a court investigates the resignation of former receiver David Unkovic. 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. 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). Dismissal of the Chapter 9 petition was upheld in a U.S. District Court. 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., co-chair of the group. Mr. Unkovic resigned as receiver March 30, 2012. HEALTH NET: Moody's Retains 'Ba3' Sr. Debt Rating, Outlook Stable ----------------------------------------------------------------- Moody's Investors Service affirmed Health Net, Inc.'s Ba3 senior debt rating and the Baa3 insurance financial strength (IFS) rating of its operating company. The outlook on the ratings was changed to stable from positive. The rating action follows weak reported first quarter 2012 results. Ratings Rationale Commenting on the change to a stable outlook, Moody's said that as a result of the unexpected first quarter 2012 financial results and a downward revision to the company's guidance, it is unlikely that Health Net would meet the EBITDA, coverage and membership growth target expectations to achieve an upgrade in the next 18 months. The rating agency added that the unanticipated financial results, impacted by problems in the reporting of claims, also raise questions about the company's risk management. Moody's noted that the failure of the company to identify the magnitude of a delay in claims submissions due to new federal guidelines resulted in Health Net under-reserving for medical claim costs at the end of 2011. The resulting adverse prior period development of $67 million lowered results in the first quarter of 2012 and forced the company to recast its medical cost projection for 2012, increasing the projection by another $67 million. Moody's commented that if there are additional adverse developments or if utilization increases above Health Net's pricing assumption, results could worsen. The rating agency added that this latest development follows a series of operational issues at the company over the last few years including marketing sanctions imposed by the Center for Medicare and Medicaid Services (CMS) from November 2010 through August 2011, and a large litigation settlement in early 2011. While the company has overcome these issues in the past, and has positioned itself for improved earnings and growth, there are concerns that additional operational problems may arise. Offsetting these concerns, Moody's noted the company's substantial membership base of over 5 million members, including 3 million TRICARE members. Health Net recently retained the TRICARE contract for the North Region, which it has serviced since 2004. The new contract, which commenced in April 2011, is for a one-year period and contains three one-year option periods, which, if exercised, would extend the contract until March 31, 2015. The company was also selected to participate in a proposed three-year demonstration project in California that aims to improve the coordination of care for low-income seniors and people with disabilities who are dually eligible for Medicare and Medi-Cal (Medicaid). Although additional CMS approvals are needed as well as the finalization of rates and contract terms, Moody's conservatively estimates Health Net could add as much as $3 billion in annual revenues. Moody's indicated that if EBITDA is above 5% with organic membership growth above 1%, EBITDA interest coverage is above 10x, and the NAIC risk based capital (RBC) ratio is maintained at or above 200% of company action level (CAL), Health Net's ratings could be upgraded. Conversely, the following could result in a downgrade: EBITDA margins falling below 2%; membership loss of 10% or more over a 12 month period; the RBC ratio decreasing to below 150% of CAL; or a loss or impairment of one of the company's government contracts. The following ratings were affirmed with a stable outlook: Health Net, Inc. -- senior unsecured debt rating at Ba3. Health Net of California, Inc. -- insurance financial strength rating at Baa3. Health Net, based in Woodland Hills, California, reported total revenues of $2.8 billion for the first three months of 2012. As of March 31, 2012, the company had total medical membership (excluding Part D) of approximately 5.6 million and reported shareholders' equity of $1.4 billion. The principal methodology used in rating Health Net was Moody's Rating Methodology for U.S. Health Insurance Companies published in May 2011. Moody's insurance financial strength ratings are opinions about the ability of insurance companies to punctually pay senior policyholder claims and obligations. HENRY FAJARDO: MFC Twin Builders Goes Back to State Court --------------------------------------------------------- Magistrate Judge Sheila K. Oberto issued Findings and Recommendations remanding the case, MFC TWIN BUILDERS, LLC, Plaintiff, v. HENRY DOLOSO FAJARDO; JK DENTAL CLINIC; and DOES 1-10, inclusive, Defendants, Case No. 1:12-cv-00219-AWI-SKO (E.D. Calif.). The case was removed from the Fresno County Superior Court to the U.S. District Court for the Eastern District of California on Feb. 14, 2012, by Henry Doloso Fajardo and JK Dental Clinic. On March 14, 2012, MFC Twin Builders filed a motion to remand the case to state court. On March 14, 2012, MFC Twin Builders also filed a request that the Court enter the defaults of Mr. Fajardo and JK Dental Clinic. On April 10, 2012, MFC Twin Builders filed a motion for sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure. The Court also recommends that the defaults of Mr. Fajardo and JK Dental Clinic be entered. On Feb. 6, 2012, MFC Twin Builders filed a verified complaint asserting a claim for unlawful detainer against Mr. Fajardo and JK Dental Clinic. The complaint alleges that, on Dec. 12, 2008, Mr. Fajardo executed a "Construction Collateral Deed of Trust" conveying the property located at 2100 E. Clinton Avenue, Fresno, California, to secure payment of a promissory note made by JP Unlimited LLC in the amount of $1,300,000, payable to Metro Funding Corporation. The Construction Collateral Deed of Trust indicates that JP is a California limited liability company that entered into a loan agreement with Metro in the amount of $1,300,000. Pursuant to the Construction Collateral Deed of Trust, Mr. Fajardo agreed to guaranty that loan by pledging the Property. An assignment of the deed of trust was made by Metro to MFC Funding, LLC, which was recorded on Dec. 15, 2008. JP defaulted in payment of the note and, on Jan. 26, 2010, a notice of default and an election to sell under the deed of trust was recorded. On Feb. 14, 2011, Metro assigned its interests in the deed of trust to MFC Funding, LLC. On Feb. 15, 2011, MFC Funding assigned its interests under the deed of trust to MFC Real Estate LLC. On March 23, 2011, notice was given that the Property was to be sold at public auction on April 20, 2011. Mr. Fajardo filed a Chapter 11 petition (Bankr. E.D. Calif. Case No. 11-14536) on April 19, 2011. The April 20, 2011 trustee's sale was postponed until June 1, 2011. On May 25, 2011, the Bankruptcy Court issued an order dismissing Mr. Fajardo's bankruptcy petition. On May 31, 2011, Fajardo filed another Chapter 11 bankruptcy petition. The trustee's sale scheduled for June 1, 2011, was postponed twice and renoticed for August 24, 2011. On July 28, 2011, the Bankruptcy Court entered an order granting MFC Real Estate relief from the automatic stay relating to Mr. Fajardo's bankruptcy petition. In granting relief from the automatic stay, the Bankruptcy Court found that the filing of the bankruptcy petition was part of a scheme to delay, hinder, and defraud creditors that involved multiple bankruptcy filings affecting the Property. On Aug. 15, 2011, MFC Real Estate assigned its interest under the deed of trust to the Plaintiff. On Aug. 24, 2011, the Property was sold to the Plaintiff at the trustee's sale. The Plaintiff alleged that, at the time of the sale, the Defendants, who were not tenants, but instead the prior owners of the Property, were in possession of the Property and have remained in possession after that sale. On Oct. 28, 2011, the Plaintiff served on the Defendants a written Notice to Quit the premises. The Defendants failed to comply with the Notice to Quit, which provided the Defendants until Nov. 1, 2011, to vacate the Property. On that same day, Mr. Fajardo filed a new Chapter 13 bankruptcy petition in the Bankruptcy Court. On Dec. 16, 2011, the Bankruptcy Court issued an order confirming that the automatic stay was not in effect as to Mr. Fajardo's third Chapter 13 bankruptcy petition. On Feb. 5, 2012, the Plaintiff filed an unlawful detainer action in Fresno County Superior Court against the Defendants seeking the reasonable rental value of the Property since Aug. 26, 2011. The caption of the complaint indicates that the amount prayed for does not exceed $25,000, and the matter is designated as a limited- jurisdiction civil case because the amount in controversy does not exceed $25,000. No response to the Plaintiff's complaint was filed in state court. On Feb. 14, 2012, a Notice of Removal was filed on behalf of Mr. Farjardo and JK Dental Clinic. Following removal, no response to the complaint was filed in federal court by either Defendant. On March 14, 2012, the Plaintiff filed a motion to remand and also requested that defaults of both Defendants be entered. On April 10, 2012, the Plaintiff filed a motion for sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure. On April 18, 2012, Mr. Fajardo filed an opposition to the motion to remand. No opposition to the Plaintiff's Rule 11 motion was filed. A copy of the Court's May 9, 2012 Findings and Recommendations is available at http://is.gd/Jeh0Pgfrom Leagle.com. HOMER CITY: Moody's Cuts Rating on Pass Through Bonds to 'Caa1' --------------------------------------------------------------- Moody's Investors Service downgraded Homer City Funding LLC's pass through bonds to Caa1 from B2. The outlook remains negative. Ratings Rationale The rating downgrade to Caa1 reflects Moody's assumption of a likely prepackaged bankruptcy filing of the Project to effectuate a restructuring of Homer City's debt obligations as described in the Project's May 2012 8-K filing. The debt restructuring at Homer City Funding is expected to involve a deferral of scheduled principal payments and conversion of cash pay interest into pay- in-kind from October 1, 2012 through and including April 1, 2014. The debt restructuring is necessitated by new environmental rules that effectively require Homer City to install SO2 scrubbers for Units 1 & 2 that is estimated to cost $700-$750 million. Additionally, challenging market conditions of high coal prices and low power prices have materially depressed Homer City's cash flows and Homer City is not expected to have sufficient cash flow to fully service senior rent in 2012. Low natural gas prices have been a major driver of low power prices and have diminished Homer City's competitive position relative to efficient gas fired plants. These challenging long-term market conditions further support the downgrade to the Caa1 rating. The Caa1 rating also reflects expectations of high ultimate recovery prospect for bondholders assuming subordinated capital is provided to Homer City to fund the needed environmental capital improvements. On April 2, 2012, a wholly owned subsidiary of GE and Kiewit Power Constructors Co. executed an engineering, procurement, and construction agreement (the "EPC Agreement") to install emissions control equipment that is estimated to cost approximately $700 million to $750 million. According to Homer City's recent 8-K, a wholly owned subsidiary of GE is prepared to provide the capital to fund the EPC Agreement in the form of an equity contribution. As part of the overall restructuring of Homer City, Moody's also expects an affiliate of General Electric Capital Corporation (GECC) will obtain the economic benefits and majority ownership of all of all the operating assets of Homer City. The negative outlook considers uncertainty regarding the final form of the debt restructuring and the related uncertainty concerning long-term value of the project which largely depend upon an improvement in market fundamentals including energy and capacity prices. The rating could stabilize if Homer City is able to complete a debt restructuring on terms that do not negatively affect recovery prospects for debt holders. The rating could be downgraded if the proposed restructuring does not proceed as currently contemplated, which would include the inability to complete the environmental capital spend at Homer City. Failure of the contemplated restructuring would likely result in a significant loss to debt holders and the rating could drop by one or more notches in such a scenario. Homer City Funding LLC is a Delaware limited liability company and special purpose funding vehicle created for the purpose of engaging in a sale-leaseback transaction involving a 1,884 megawatts (MW) coal fired plant in Homer City, PA which has been leased by EME Homer City Generation L.P (EME Homer City). EME Homer City is an indirect wholly owned subsidiary of Edison Mission Energy (EME: Caa2 Corporate Family Rating). EME, an independent power producer, is a wholly owned subsidiary of Edison International (EIX: Baa2 Issuer Rating). An affiliate of General Electric Capital Corporation (GECC) is expected to obtain the economic benefit and majority ownership of all the operating assets of Homer City as part of an overall restructuring of Homer City. The principal methodology used in this rating was the Power Generation Projects rating methodology published in December 2008. The last rating action was on October 7, 2011, when Homer City's rating was downgraded to B2 from Ba3. HORNE INTERNATIONAL: Amends Loan Pact with Messrs. Horne & Foster ----------------------------------------------------------------- An amendment was made to the Loan Agreement dated Dec. 27, 2011, made with Darryl K. Horne, President and Chairman of the Board of Directors of Horne International, Inc., pursuant to which the Company and Mr. Horne agreed to amend the payment in lieu of cash conversion. (Section ii) of the Note to read as follows: (ii) In lieu of cash payments, the Lender shall have the option to convert the entire principal loan balance to Horne International Inc. common stock as described in paragraph 3 of the Loan Agreement between Horne International Inc. and Trevor Foster dated December 27, 2011. The conversion price shall be equal to $.10 per share of Horne International Inc. Common Stock. On May 4, 2012, an amendment was made to the Loan Agreement dated Dec. 27, 2011, made with Trevor Foster pursuant to which the company and Mr. Foster agreed to amend the payment in lieu of cash conversion. (Section ii) of the Note to read as follows: (ii) In lieu of cash payments, the Lender shall have the option to convert the entire principal loan balance to Horne International Inc. common stock as described in paragraph 3 of the Loan Agreement between Horne International Inc. and Trevor Foster dated December 27, 2011. The conversion price shall be equal to $.10 per share of Horne International Inc. Common Stock. About Horne International Fairfax, Va.-based Horne International, Inc., is an engineering services company focused on provision of integrated, systems approach based solutions to the energy and environmental sectors. The Company reported a net and total comprehensive loss of $121,000 on $5.68 million of revenue for the 12 months ended Dec. 25, 2011, compared with a net and total comprehensive loss of $1.04 million on $3.43 million of revenue for the 12 months ended Dec. 26, 2010. The Company's balance sheet at Dec. 25, 2011, showed $1.33 million in total assets, $2.18 million in total liabilities and a $853,000 total stockholders' deficit. For 2011, Stegman & Company, in Baltimore, Maryland, expressed substantial doubt as to the Company's ability to continue as a going concern. The independent auditors noted that the Company has experienced continuing net losses for each of the last four years and as of Dec. 25, 2011, current liabilities exceeded current assets by $900,000. HOSTESS BRANDS: KPS Capital Reportedly Eyeing Cakes Maker --------------------------------------------------------- Jonathan Randles at Bankruptcy Law360 reports that private equity firm KPS Capital Partners LP is one of at least two bidders that have placed formal offers to purchase Hostess Brands Inc., offering a potential lifeline for the cakes maker as it struggles through a contentious bankruptcy, according to a Thursday news report. The bids likely ranged between $500 million and $600 million, a New York Post report said, citing an anonymous source, Law360 relates. About Hostess Brands Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known for iconic brands such as Butternut, Ding Dongs, Dolly Madison, Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride, Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution centers and 570 outlets in 49 states. Hostess filed for Chapter 11 bankruptcy protection early morning on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through 12-22056) in White Plains, New York. Debtor-affiliates that filed separate Chapter 11 petition are IBC Sales Corporation, IBC Trucking LLC, IBC Services LLC, Interstate Brands Corporation, and MCF Legacy Inc. Hostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of Dec. 10, 2011. Debt includes $860 million on four loan agreements. Trade suppliers are owed as much as $60 million. The bankruptcy filing was made two years after predecessors Interstate Bakeries Corp. and its affiliates emerged from bankruptcy (Bankr. W.D. Mo. Case No. 04-45814). Ripplewood Holding LLC, after providing $130 million to finance the plan, obtained control of IBC's business following the prior reorganization. Hostess Brands is privately held. The new owners pursued new Chapter 11 cases to escape from what they called "uncompetitive and unsustainable" union contracts, pension plans, and health benefit programs. In 2011, Hostess retained Houlihan Lokey to explore sales of its smaller assets and individual brands. Houlihan Lokey oversaw the sale of Mrs. Cubbison's to Sugar Foods Corporation for $12 million, but was unable to sell any of Hostess' core assets. Judge Robert D. Drain oversees the case. Hostess has hired Jones Day as bankruptcy counsel; Stinson Morrison Hecker LLP as general corporate counsel and conflicts counsel; Perella Weinberg Partners LP as investment bankers, FTI Consulting, Inc. to provide an interim treasurer and additional personnel for the Debtors, and Kurtzman Carson Consultants LLC as administrative agent. Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry Wilson, the head of turnaround and restructuring firm MAEVA Advisors, are representing the Teamsters union. Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and Bakery & Confectionery Union & Industry International Pension Fund are Jeffrey R. Freund, Esq., at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright & Jaworski L.L.P. An official committee of unsecured creditors has been appointed in the case. The committee selected New York law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom Mayer and Ken Eckstein head the legal team for the committee. Hostess in April concluded the trial seeking authorization to terminate contracts with the Teamsters and bakery workers, the two largest unions. The trial to reject contracts with other unions is scheduled to begin May 21. The company says costs must be reduced to attract new capital required to exit bankruptcy. HOUGHTON MIFFLIN: To Swap Debt for New Equity Via Ch. 11 -------------------------------------------------------- Educational publisher Houghton Mifflin Harcourt said Friday that it's soliciting votes on a prepackaged bankruptcy reorganization that eliminates $3.1 billion in debt by giving up control of the company to creditors. The Company has already obtained support from 70% of the lending group (secured bank facilities and secured notes). The Boston- based company is currently soliciting votes from lenders, bondholders and stockholders. In addition, HMH has obtained a $500 million financing commitment, which will provide sufficient liquidity to support seasonal working capital swings. US bank, Citigroup Global Markets is providing the debt facility. "We are excited to have reached an agreement with our lenders and bondholders on a financial restructuring plan that will equitize our current long-term debt and put HMH in a financially stronger position for the future," said Linda K. Zecher, President and Chief Executive Officer of HMH. "With a more appropriately-sized capital structure and greater financial flexibility, along with our world-class brand and innovative digital education solutions, we will be well-positioned to accelerate our growth initiatives and expand our digital platform." Under the prepackaged Chapter 11 plan: * HMH will convert its existing bank and bond debt into 100% of the equity in the reorganized Company; * trade creditors and other unsecured creditors will be paid in full in the ordinary course. * If their class votes in favor of the restructuring plan, existing equity holders will receive warrants exercisable for up to 5% of the equity in the reorganized Company. Because of the high level of support it has obtained from its lenders and bondholders for the plan, the Company expects to complete this financial restructuring quickly, likely by the end of June 2012. The Company's restructuring counsel is Paul, Weiss, Rifkind, Wharton & Garrison LLP and its financial advisor is Blackstone. The lenders' restructuring counsel is Akin Gump Strauss Hauer & Feld LLP and their financial advisor is Houlihan Lokey Capital, Inc. Reverse Takeover Financier Barry O'Callaghan founded the group when his electronic publishing business, Riverdeep PLC, completed a $5 billion reverse takeover of Houghton Mifflin in 2006. Riverdeep paid $1.75 billion in cash and assumed $1.61 billion in debt from the private investment firms Thomas H. Lee Partners, Bain Capital and The Blackstone Group. Reuters relates that by 2007 the group was the biggest education publisher in the US, and in 2008, Mr. O'Callaghan estimated his personal wealth at over EUR1 billion. However, the financial collapse in September of that year pulled the rug out from under HMH, which suffered as education spending in the US fell. In 2010, the group was forced into a balance sheet restructuring that saw lenders owed $7 billion take a majority stake in the business. The deal wiped out EUR170 million in equity held by Irish investors. The agreement provided for a reduction in the senior debt to $3 billion from the current $5 billion, with new equity issued to the senior debt holders, conversion of the $2 billion mezzanine debt into equity and warrant, receipt of $650 million of new cash from the sale of new equity. Annual interest expense was also reduced by 75%. According to Reuters, Mr. O'Callaghan left the company last year, but remains as chairman of an offshoot, EPMG, which has education publishing businesses in China and India. US hedge fund Paulson, led by billionaire John Paulson, is currently the biggest shareholder of HMH. About Houghton Mifflin Harcourt Houghton Mifflin Harcourt -- http://www.hmhco.com/-- claims to be among the world's largest providers of pre-K-12 learning materials. Its education products and services are used by 57 million students throughout all 50 U.S. states and 120 countries. With origins dating back to 1832, the Company also publishes an extensive line of reference works and award-winning literature for adults and young readers. Fitch Ratings notes that HMH continues to be a leader in the K-12 educational material and services sector, capturing 41% of 2011 market share (adoption and open territory market [excluding Advanced Placement Sales] -- based on Association of American Publishers (AAP) and company data). HOUGHTON MIFFLIN: Moody's Cuts CFR/PDR to 'Ca'; Outlook Stable -------------------------------------------------------------- Moody's Investors Service lowered Houghton Mifflin Harcourt Publishers Inc.'s (HMH) Corporate Family Rating (CFR), Probability of Default Rating (PDR) and debt instrument ratings to Ca from Caa3. The rating action reflects the high likelihood of a near- term default following HMH's announcement that it reached an agreement with more than 70% of its lenders and bondholders to convert all of its existing debt to equity. HMH plans to shortly file for Chapter 11 bankruptcy to facilitate a pre-packaged reorganization that the company expects to complete by the end of June 2012. The rating outlook is stable. Downgrades: Issuer: Houghton Mifflin Harcourt Publishers Inc. Corporate Family Rating, Downgraded to Ca from Caa3 Probability of Default Rating, Downgraded to Ca from Caa3 Senior Secured Bank Credit Facility, Downgraded to Ca from Caa3 (no change to LGD4 - 53% assessment) Senior Secured Regular Bond/Debenture, Downgraded to Ca from Caa3 (no change to LGD4 - 53% assessment) Outlook Actions: Issuer: Houghton Mifflin Harcourt Publishers Inc. Outlook, Changed To Stable From Negative Ratings Rationale HMH's Ca CFR is based on the announced plan to shortly file for bankruptcy and Moody's view that the family recovery rate in a restructuring would be slightly below 50% based on a scenario in which earnings rebound from 2011 levels over the next 3-5 years. Moody's will lower the PDR to D once HMH files for bankruptcy and expects to withdrawal the existing ratings shortly thereafter. The conversion of debt to equity will meaningfully reduce HMH's leverage and cash interest burden, and provide the company with greater operating flexibility. HMH's plans to pay existing trade and other unsecured creditors in full in the ordinary course of business. The stable rating outlook reflects Moody's view that the current ratings appropriately reflect the expected loss in the proposed near-term restructuring. Moody's does not believe an upgrade to ratings based on the existing capital structure is likely. As noted, the PDR will be downgraded to D from Ca once HMH files for bankruptcy. The CFR and debt instrument ratings could be downgraded if Moody's revises its expected family recovery rate lower. The principal methodology used in rating HMH was the Global Publishing Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Houghton Mifflin Harcourt Publishers Inc., headquartered in Boston, MA, is one of the three largest U.S. education publishers focusing on the K-12 market with approximately $1.3 billion of revenue for fiscal year ended December 2011. HUGHES TELEMATICS: Incurs $15.6 Million Net Loss in Q1 ------------------------------------------------------ HUGHES Telematics, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $15.62 million on $22.07 million of total revenues for the three months ended March 31, 2012, compared with a net loss of $22.71 million on $15.96 million of total revenues for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $110.18 million in total assets, $211.81 million in total liabilities, and a $101.62 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/3FNPgD About HUGHES Telematics Atlanta, Ga.-based HUGHES Telematics, Inc. is a telematics services company that provides a suite of real-time voice and data communications services and applications for use in vehicles and is developing additional applications for use within and outside of the automotive industry. HUGHES reported a net loss of $85.35 million in 2011, a net loss of $89.56 million in 2010, and a net loss of $163.66 million in 2009. In its report on the Company's 2011 financial results, PricewaterhouseCoopers LLP, in Atlanta, Georgia, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring losses from operations and has a net capital deficiency. INTELSAT SA: Receives Additional Tenders of $1.5MM 9 1/2% Notes --------------------------------------------------------------- Intelsat Jackson Holdings S.A. commenced tender offers to purchase for cash any and all of its outstanding $701,913,000 aggregate principal amount of 9 1/2% Senior Notes due 2016 and up to $470,000,000 aggregate principal amount of its outstanding $1,048,220,000 aggregate principal amount of 11 1/4% Senior Notes due 2016. On April 26, 2012, Intelsat Jackson purchased $48,042,000 aggregate principal amount of the 9 1/2% Notes and $10,059,000 aggregate principal amount of the 11 1/4% Notes, in each case that were tendered prior to 5:00 p.m. New York City time on Wednesday, April 25, 2012, pursuant to the Tender Offers. Each of the Tender Offers expired at 12:00 midnight, New York City time on Wednesday, May 9, 2012. On May 10, 2012, Intelsat Jackson was advised by Global Bondholder Services Corporation, as the depositary for the Tender Offers, that after the Early Tender Time and prior to the Expiration Time, Intelsat Jackson had received tenders of an additional $1,502,000 aggregate principal amount of the 9 1/2% Notes and no additional tenders of the 11 1/4% Notes pursuant to the Tender Offers. Including accrued and unpaid interest, on May 10, 2012, Intelsat Jackson paid $1,618,305 in consideration for the 9 1/2% Notes tendered after the Early Tender Time and prior to the Expiration Time. About Intelsat Intelsat S.A., formerly Intelsat, Ltd., provides fixed-satellite communications services worldwide through a global communications network of 54 satellites in orbit as of Dec. 31, 2009, and ground facilities related to the satellite operations and control, and teleport services. It had US$2.5 billion in revenue in 2009. Washington D.C.-based Intelsat Corporation, formerly known as PanAmSat Corporation, is a fully integrated subsidiary of Intelsat S.A., its indirect parent. Intelsat Corp. had US$7.70 billion in assets against US$4.86 billion in debts as of Dec. 31, 2010. The Company reported a net loss of $433.99 million in 2011, a net loss of $507.77 million in 2010, and a net loss of $782.06 million in 2009. The Company's balance sheet at March 31, 2012, showed $17.40 billion in total assets, $18.52 billion in total liabilities, $49.51 million in noncontrolling interest and a $1.16 billion total Intelsat S.A. shareholder's deficit. * * * Luxembourg-based Intelsat S.A. carries 'B' issuer credit ratings from Standard & Poor's. It has 'Caa1' corporate family and probability of default ratings from Moody's Investors Service. ISTAR FINANCIAL: Files Form 10-Q, Incurs $46MM Net Loss in Q1 ------------------------------------------------------------- iStar Financial Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $46.04 million on $94.70 million of total revenues for the three months ended March 31, 2012, compared with net income of $83.90 million on $110.24 million of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2012, showed $7.58 billion in total assets, $6.08 billion in total liabilities, and $1.50 billion in total equity. A copy of the Form 10-Q is available for free at: http://is.gd/TtJ0xb About iStar Financial New York-based iStar Financial Inc. (NYSE: SFI) provides custom- tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust, provides innovative and value added financing solutions to its customers. The Company reported a net loss of $25.69 million in 2011, compared with net income of $80.20 million in 2010. * * * As reported by the TCR on March 29, 2011, Fitch Ratings has upgraded the Issuer Default Rating to 'B-' from 'C'. The upgrade of iStar's IDR is based on the improved liquidity profile of the company, pro forma for the new senior secured credit agreement (the new financing) that extends certain of the company's debt maturities, relieving the overhang of significant secured debt maturities in June 2011. As reported by the Troubled Company Reporter on March 22, 2011, Standard & Poor's said that it raised its counterparty credit rating on iStar Financial Inc. to 'B+' from 'CCC' and removed it from CreditWatch where it was placed with positive implications on Feb. 23. The outlook is stable. "The upgrade reflects the company's closing of a $2.95 billion senior secured credit facility, which it will use to refinance the company's existing secured bank facilities and repay a portion of the company's unsecured debt," said Standard & Poor's credit analyst Jeffrey Zaun. If S&P's analysis of the new secured facility indicates 100% or more collateral coverage, S&P will rate the issue 'BB-'. If S&P's analysis of collateral indicates less than 100% coverage, S&P will rate the issue 'B+'. JAMES RIVER: Michael Cook Holds 4.3% of Class A Common Shares ------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Michael W. Cook Asset Management, Inc., d/b/a SouthernSun Asset Management disclosed that, as of April 30, 2012, it beneficially owns 1,526,955 shares of Class A common stock of James River Coal Co representing 4.31% of the shares outstanding. A copy of the filing is available for free at http://is.gd/Tj8hMn About James River Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. The Company reported a net loss of $39.08 million in 2011, compared with net income of $78.16 million in 2010. The Company's balance sheet at March 31, 2012, showed $1.36 billion in total assets, $984.91 million in total liabilities and $383.57 million in total shareholders' equity. * * * In March 2012, Standard & Poor's Ratings Services lowered its corporate credit rating on James River to 'B-' from 'B'. "The downgrade and ongoing CreditWatch listing reflect our view that James River Coal's 2012 operating performance will be lower than we previously expected," said Standard & Poor's credit analyst Megan Johnston. "We believe that demand for thermal coal will continue to be negatively affected by natural gas substitution and recent warmer weather trends. Absent increasing natural gas prices or a warmer-than-normal summer, thermal coal prices may continue to decline to lower levels than we previously anticipated." In April 2012, Moody's Investors Service affirmed the company's B3 corporate family rating (CFR) and SGL-3 speculative grade liquidity rating, indicating an adequate liquidity position. The B3 CFR is principally constrained by a high cost position, high leverage, meaningful decrease in thermal coal prices, and likelihood of margin compression in thermal coal business as existing contracts roll off over the next year. The ratings also consider relatively high thermal coal inventories and generally stagnant coal demand at the power utilities. LIBERTY HARBOR: Sues Former Business Partner Over 'Invalid' Deed ---------------------------------------------------------------- Jake Simpson at Bankruptcy Law360 reports that Liberty Harbor Holding LLC hit a former business partner with an adversary suit Thursday, claiming a deed the partner purports to hold on a joint development is not valid. Law360 relates that Liberty Harbor said SWJ Holdings LLC improperly assumed 100 percent of ownership of the 19-acre Liberty Harbor development site in Jersey City in 2006. About Liberty Harbor Jersey City, New Jersey-based Liberty Harbor Holding, LLC, along with two affiliates, sought Chapter 11 protection (Banrk. D. N.J. Lead Case No. 12-19958) in Newark on April 17, 2012. Liberty, as of April 16, 2012, had total assets of $350.08 million, comprising of $350 million of land, $75,000 in accounts receivable and $458 cash. The Debtor says that it has $3.62 million of debt, consisting of accounts payable of $73,500 and unsecured non- priority claims of $3,540,000. The Debtor's real property consists of Block 60, Jersey City, NJ 100% ownership Lots 60, 70, 69.26, 61, 62, 63, 64, 65, 25H, 26A, 26B, 27B, 27D. Affiliates that filed separate petitions are: Liberty Harbor II Urban Renewal Co., LLC (Case No. 12-19961) and Liberty Harbor North, Inc. (Case No. 12-19964). Judge Novalyn L. Winfield presides over the case. The petition was signed by Peter Mocco, managing member. LIGHTSQUARED INC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: LightSquared Inc. 450 Park Avenue Suite 2201 New York, NY 10022 Bankruptcy Case No.: 12-12080 Debtor-affiliates that filed separate Chapter 11 petitions: Debtor Case No. ------ -------- LightSquared LP 12-12081 LightSquared Corp. 12-12082 LightSquared Network LLC 12-12083 One Dot Six Corp. 12-12084 TMI Communications Del. Ltd. Partnership 12-12085 ATC Technologies LLC 12-12086 LightSquared Bermuda Ltd. 12-12088 LightSquared Finance Co 12-12089 LightSquared GP Inc. 12-12091 LightSquared Inc. of Virginia 12-12092 LightSquared Investors Holdings Inc. 12-12093 LightSquared Subsidiary LLC 12-12094 One Dot Four Corp. 12-12095 One Dot Six TVCC Corp. 12-12096 SkyTerra (Canada) Inc. 12-12097 SkyTerra Holdings (Canada) Inc. 12-12098 SkyTerra Investors LLC 12-12099 SkyTerra Rollup LLC 12-12101 SkyTerra Rollup Sub LLC 12-12102 Type of Business: LightSquared was the first private mobile satellite-communications company to offer wholesale mobile satellite services throughout North America to both companies and government agencies for bandwidth power and capacity, telephony resale, data and dispatch services and retail voice users. LightSquared planned to develop a wholesale 4G LTE wireless broadband communications network integrated with satellite coverage across the United States. But the plan hit a roadblock when the U.S. military and others complained that the planned service would disrupt global positioning system equipment. Web site: http://www.lightsquared.com/ Chapter 11 Petition Date: May 14, 2012 Court: U.S. Bankruptcy Court Southern District of New York Judge: Hon. Shelley C. Chapman Debtors' Counsel: Matthew S. Barr, Esq. Steven Z. Szanzer, Esq. Karen Gartenberg, Esq. MILBANK, TWEED, HADLEY & MCCLOY LLP 1 Chase Manhattan Plaza New York, NY 10005-1413 Tel: (212) 530-5000 Fax: (212) 530-5219 E-mail: mbarr@milbank.com sszanzer@milbank.com kgartenberg@milbank.com Debtors' General Canadian Counsel: FRASER MILNER CASGRAIN LLP Debtors' Investment and Financial Advisor: MOELIS & COMPANY Debtors' Financial Advisor: ALVAREZ & MARSAL NORTH AMERICA, LLC Debtors' Claims and Noticing Agent: KURTZMAN CARSON CONSULTANTS LLC 2335 Alaska Avenue El Segundo, CA 90245 Tel: (877) 499-4509 Debtors' Information Officer: ALVAREZ & MARSAL CANADA INC. Total Assets: $4.48 Billion as of Feb. 29, 2012 Total liabilities: $2.29 billion as of Feb. 29, 2012 Estimated Debts: More than $1 billion The petition was signed by Marc R. Montagner, chief financial officer and interim co-chief operating officer. Consolidated Lift of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Boeing Satellite Systems Inc. Trade $7,483,005 2260 E. Imperial Hwy. El Segundo, CA 90245 Attn: Mr. W. James McNerney Jr. Preside and CEO Tel: (310) 364-4000 Fax: (310) 364-6677 Alcatel-Lucent Trade $7,343,549 3 Av. Octave Greard 75007 Paris, France Attn: Mr. Ben Verwaayen Chief Executive Officer Tel: +33 (0) 40 76 10 10 E-mail: execoffice@alcatel-lucent.com AnyDATA Corporation Trade $690,000 5 Oldfield Irvine, CA 92618 Attn: Dr. Soon B. Shin President & CEO Tel: (949) 900-6040 Fax: (949) 600-9909 Bandrich, Inc. Trade $390,600 No. 188, 7f, Baociao Rd Sin-Dian City Taipei, Taiwan 23146 Attn: Dr. Wen-Yi Kuo CEO Tel: +866-2-2799-8851 Fax: +866-2-2799-8812 Burson-Marsteller Trade $264,761 230 Park Avenue South New York, NY 10003-1528 Attn: Mr. Tony Telloni Market Leader Tel: (212) 614-4000 Fax: (212) 598-5320 Level 3 Communications LLC Trade $169,436 Oracle Inc. Trade $163,979 SBA Structures Inc. Trade $100,800 SBA Towers III LLC Trade $77,350 USAC Professional $56,686 Liebert Services Inc. Trade $39,115 Westar Satellite Services LP Landlord $38,451 Shockey Scofield Solutions, LLC Professional $35,000 Intelsat Landlord $32,609 SED Systems Landlord $31,640 Cyberbridge Trade $28,969 Mehlman Capitol Strategies Professional $20,000 Verizon Trade $15,716 AT&T Trade $15,181 Polaris Logistics Landlord $11,770 LIGHTSQUARED INC: Files for Bankruptcy As It Deals With FCC ----------------------------------------------------------- Mobile communications company LightSquared Inc. and 19 of its affiliates filed Chapter 11 bankruptcy petitions Monday in Bankruptcy Court in Manhattan as the Company seeks to resolve regulatory issues that have prevented it from building its coast- to-coast integrated satellite 4G wireless network. LightSquared, which has invested more than $4 billion to deploy an integrated satellite-terrestrial network that will provide next generation, high-speed mobile services on a nationwide basis, said it fully expects to continue normal operations throughout the bankruptcy process. The company said all of its distribution partners and customers, including public safety, emergency response, government and military users of LightSquared's satellite-based communications services can continue to rely on LightSquared to provide them with mission critical communications services. Jacqueline Palank, writing for Dow Jones Newswires, reports the bankruptcy filing was made hours ahead of the expiration of a deal to keep LightSquared from defaulting on its debt. The Wall Street Journal's Mike Spector and Dow Jones' Greg Bensinger reported Sunday that people familiar with the matter said LightSquared was preparing to file for bankruptcy after negotiations with lenders to avoid a potential debt default faltered. LightSquared and its lenders had until 5 p.m. Monday to reach a deal. The Hon. Shelley C. Chapman, who has been assigned to the case, will convene the first hearing in the case Tuesday afternoon at 3:00 p.m. (Eastern Time), and consider so-called First Day motions filed by the Debtors. Road to Bankruptcy LightSquared's state-of-the-art satellite -- launched in 2010 -- is intended to combine 4G LTE terrestrial technology to create a nationwide communications system that offers superior coverage and mobile broadband speeds. However, in February the U.S. Federal Communications Commission told LightSquared it would revoke a license to build out the network as it would interfere with global positioning systems used by the military and various industries. A month later, LightSquared suffered another setback when Sprint terminated a master services agreement effective March 16, 2012. Under the deal, LightSquared and Sprint had worked closely together to weather the delays in the build-out of the terrestrial broadband mobile network throughout the United States. While LightSquared deemed Sprint's exit beneficial given LightSquared's reduced operations and liquidity, its prepetition lenders considered the termination of the Sprint Master Services Agreement would trigger cross-defaults under the company's prepetition credit agreements. Discussions with Prepetition Lenders Recognizing the liquidity constraints on its business operations and necessity of an extended period in which to resolve its issues with the FCC as well as to streamline its business operations and financial obligations, LightSquared began negotiations with prepetition lenders in February 2011 to waive, among others, the then potential events of default asserted by the prepetition lenders. LightSquared Inc. owes $322,333,494 under a July 2011 prepetition term loan facility with U.S. Bank National Association, as successor administrative agent to UBS AG, Stamford Branch. Meanwhile, affiliate LightSquared LP owes $1,700,571,106 under an October 2010 credit facility with UBS AG, Stamford Branch and Wilmington Trust FSB, as agents. Throughout the first quarter of 2012, LightSquared faced liquidity challenges. LightSquared LP was obligated to make a $25 million interest payment to its prepetition lenders on March 30, which reduced the availability of cash on hand to LightSquared LP. On March 15, 2012, LightSquared was able to secure a waiver under the July 2011 facility and a short, 45-day waiver, subsequently extended by two waivers each granting an additional seven days, under the October 2010 facility. The maturity date for the July 2011 facility was extended from July 1, 2012, to Dec. 31, 2012, and a 2% non-cash fee was paid to the UBS AG, Stamford Branch, as administrative agent, for the ratable account of each July 2011 lender. Philip Falcone's Harbinger Capital Partners, which indirectly owns 96% of LightSquared's outstanding common stock, also agreed to subordinate amounts owing to it under facility to amounts owing to the other lenders in exchange for 2.5 million penny warrants. During the 59-day period, LightSquared and the Prepetition Lenders attempted to negotiate a global restructuring that would provide LightSquared with the liquidity and runway necessary to resolve its issues with the FCC. Despite working diligently and in good faith, however, LightSquared and the Prepetition Lenders were not able to consummate a global restructuring on terms acceptable to all interested parties. "The Debtors were thus faced with no option but to commence these Chapter 11 Cases as the Debtors believed the Prepetition Lenders would attempt to exercise remedies and sweep the very cash necessary to conduct LightSquared's business and provide LightSquared with the requisite time to address FCC concerns," LightSquared said in papers filed in court. WSJ's Mr. Spector and Dow Jones' Mr. Bensinger, citing unnamed sources, reported Sunday that Mr. Falcone couldn't agree with lenders on how to cede ownership stakes in the company to them over time. The sources also said there were a number of other terms separating the two sides. According to the report, the lenders wanted LightSquared to be overseen by an independent board that didn't include Mr. Falcone. The hedge-fund manager tacitly agreed to that, but the financial restructuring created a gulf between the two sides. The sources also said the lenders also wanted to hold Mr. Falcone personally liable for a future bankruptcy filing under certain circumstances, but Mr. Falcone balked at that term, especially since he was poised to no longer sit on LightSquared's board or make major decisions for the firm. In April, Matthew Goldstein, writing for Reuters, reported that two people familiar with the situation said a number of LightSquared debt holders have joined together to retain bankruptcy attorney Thomas Lauria, Esq., who heads White & Case's global restructuring group. According to Reuters, the unnamed sources said the creditors' group includes billionaire activist investor Carl Icahn, hedge fund manager David Tepper and investment firms Fortress Investment Group and Capital Research and Management Company. Reuters said the institutional investors own some of the $1.6 billion in bank debt that LightSquared sold to raise money for its planned network. LightSquared said in court filings it intends to vigorously defend its rights in the ongoing 2012 Public Notice process with the FCC, while simultaneously pursuing a resolution with the FCC and other federal government agencies that will permit it to deploy its terrestrial network. LightSquared noted that the process may last up to two years. As of the Petition Date, the Debtors employed roughly 168 people in the United States and Canada. As of Feb. 29, 2012, the Debtors had $4.48 billion in assets (book value) and $2.29 billion in liabilities. Bye Carl, Hello Charlie! WSJ's Mr. Spector and Dow Jones' Mr. Bensinger earlier this month reported several people familiar with the matter said Sound Point Capital, a small hedge fund with ties to Charlie Ergen, the satellite mogul and head of Dish Network Corp., engaged in a transaction with Carl Icahn where Mr. Icahn sold his roughly $250 million worth of LightSquared debt. The bank-debt trade hasn't yet settled, leaving those in the negotiations unsure of the ultimate buyer, the people close to the matter said. According to the report, one person familiar with the matter said Mr. Icahn sold his debt for about 60 cents on the dollar or a bit higher, giving him a profit on his original purchase when the debt was trading between 40 cents and 50 cents. Mr. Icahn didn't respond to requests for comment. Canadian Proceedings LightSquared also intends to seek ancillary relief in Canada on behalf of all of the Debtors, pursuant to the Companies' Creditors Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the Ontario Superior Court of Justice (Commercial List) in Toronto, Ontario, Canada. The purpose of the ancillary proceedings is to request the Canadian Court to recognize the Chapter 11 cases as a "foreign main proceeding" under the applicable provisions of the CCAA to, among other things, protect the Debtors' assets and operations in Canada. The Debtors named affiliate LightSquared LP to act as the "foreign representative" on behalf of the Debtors' estates. In addition to its operations in the United States, LightSquared has certain assets and limited operations in Canada. Three of the Debtors are incorporated in Canada: SkyTerra Holdings (Canada) Inc., SkyTerra (Canada) Inc. and LightSquared Corp. Breathing Room Marc Montagner, interim co-chief operating officer and chief financial officer of LightSquared, said, "The filing was necessary to preserve the value of our business and to ensure continued operations. The voluntary Chapter 11 filing is intended to give LightSquared sufficient breathing room to continue working through the regulatory process that will allow us to build our 4G wireless network." "All of our efforts are focused on concluding this process in an efficient and successful manner," he added. LightSquared said it intends to work with all key constituents to conduct an orderly restructuring process to maximize its asset value and to exit Chapter 11 in the quickest and most efficient manner possible. LightSquared expects that its current management team will continue to lead the company throughout this process. According to Dow Jones' Ms. Palank, Mr. Falcone told Harbinger Capital Partners investors Monday that Chapter 11 protection for LightSquared was the best option for the wireless venture and he vowed to carry out plans to build a nationwide high-speed mobile broadband network. "I am focused, as I have been throughout the course of this investment, on preserving and maximizing the value of LightSquared for the benefit of Harbinger's investors," Mr. Falcone said in a note to investors obtained by The Wall Street Journal. A bankruptcy filing "was a necessary and appropriate decision by LightSquared to preserve its value." Harbinger Capital Partners and certain of its managed and affiliated funds and wholly owned subsidiaries, including HGW US Holding Company, L.P., Blue Line DZM Corp., and Harbinger Capital Partners SP, Inc., are represented in the case by: Stephen Karotkin, Esq. Debra A. Dandeneau, Esq. Ronit J. Berkovich, Esq. WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 E-mail: stephen.karotkin@weil.com debra.dandeneau@weil.com ronit.berkovich@weil.com New York-based LightSquared was incorporated in Delaware in 1985. On March 29, 2010, SkyTerra Communications, Inc., LightSquared's predecessor company, consummated a merger with Sol Private Corp., resulting in certain Harbinger Capital Partners investment funds acquiring all of the outstanding stock of SkyTerra not previously held by Harbinger. Following the consummation of the merger, SkyTerra continued as the surviving corporation and was wholly owned by Harbinger through HGW US Holding Company, L.P. SkyTerra later changed its name to LightSquared Inc. on July 20, 2010. LL MURPHREY: Court Pegs Recapitalized Debt at $6.18-Mil. -------------------------------------------------------- Bankruptcy Judge J. Rich Leonard clarified that, pursuant to the Court's Dec. 16, 2011 order, the amount of Recapitalized Debt as defined by the Fourth Amended Plan of Reorganization of L.L. Murphrey Company is set at $6,186,362, and the liability of the pre-petition guarantors is capped at this amount. In the lawsuit, L.L. MURPHREY COMPANY, LARRY BARROW, LOIS BARROW, AND DORIS MURPHREY, PLAINTIFFS, v. D.A.N. JOINT VENTURE III, L.P., DEFENDANT, Adv. Proc. No. 11-00139-8-JRL (Bankr. E.D.N.C.), the defendant sought reconsideration of the Dec. 16, 2011 order granting summary judgment for the plaintiffs on their computation of the amount of Recapitalized Debt as defined in the Plan, and denying summary judgment on the defendant's counterclaim dealing with identification of collateral. Although the Bankruptcy Court did not enter a final judgment on the basis of the December order, the defendant filed a notice of appeal which is currently pending in the U.S. District Court. The Defendant now seeks a determination from the Bankruptcy Court that the earlier order did not resolve all of the claims in the action, and thus is not final. Although all of the issues raised by the pleadings were fully discussed at the hearing on Nov. 21, 2011, the Bankruptcy Court agrees the December order does not clearly dispose of all of them. The lawsuit advances two claims for relief. In Count 1, it seeks declaratory relief both as to the amount of the debt to be recapitalized, and also as to the liability of the guarantors. In Count 2, it seeks injunctive relief prohibiting the defendant from attempting to collect any amount in excess of the plaintiffs' assertions as to the recapitalized amount and scope of guarantor liability. The answer, in turn, advances two counterclaims. The first counterclaim deals with the issue of collateral identification determined adversely to the defendant in the December order. The second counterclaim asserts the reopening of the bankruptcy case as a material default, an issue decided adversely to the defendant in the Court's ruling on the motion to dismiss of Oct. 12, 2011. In his May 10, 2012 Order, Judge Leonard ruled that: -- the request for injunctive relief is denied; -- relief is denied defendant on its two counterclaims; and -- the action is dismissed. In matching the court's orders to the claims and counterclaims asserted, Judge Leonard said it is clear there has never been a ruling on the two issues of injunctive relief and guarantor liability fairly raised as claims. According to Judge Leonard, the issue regarding injunctive relief is easily resolved. There has been no showing that the defendant has made any impermissible attempts to collect a debt inconsistent with the court's rulings, and there is no basis on which to infer that it will not abide by any final adjudication of these issues. Accordingly, the requisite showing of irreparable harm for injunctive relief has not been made. A copy of the Court's May 10, 2012 Order is available at http://is.gd/DXAmrcfrom Leagle.com. About L.L. Murphrey L.L. Murphrey Company is North Carolina corporation engaged in the swine business, with its principal place of business in Greene County, North Carolina. LLM filed for chapter 11 bankruptcy (Bankr. E.D.N.C. Case No. 00-03213) on June 8, 2000. On July 13, 2001, the Court entered an order confirming the Debtor's fourth amended plan of reorganization. LOTHIAN OIL: Creditor Asks 2nd Circ. to Resolve Jurisdiction Row ---------------------------------------------------------------- Lana Birbrair at Bankruptcy Law360 reports that a Lothian Oil Inc. creditor asked the Second Circuit on Tuesday to resolve a jurisdictional fight over sanctions and other issues in a suit accusing the bankrupt oil company of conspiracy that has bounced between state, federal and bankruptcy courts in New York and Texas. Appellant Israel Grossman, who launched New York state suits along with others seeking additional payouts under Lothian's reorganization plan, asked the Second Circuit in a brief to determine whether a New York bankruptcy court could enforce sanctions by a Texas bankruptcy, according to Law360. About Lothian Oil Based in Midland, Texas, Lothian Oil Inc. was a privately owned oil and gas company. Lothian and six affiliates filed for chapter 11 protection (Bankr. W.D. Tex. Case No. 07-70121) on June 13, 2007. The Debtors were represented by lawyers at Haynes and Boone, LLP. When Lothian sought bankruptcy, it listed assets and debts between $1 million to $100 million. On June 27, 2008, the bankruptcy court confirmed a plan of liquidation. MARRICK PROPERTIES: St. Petersburg Boutique Hotel in Chapter 11 --------------------------------------------------------------- Marrick Properties LLC, the operator of the Pier Hotel, filed a petition for Chapter 11 reorganization (Bankr. M.D. Fla. Case No. 12-07179) on May 9 in Tampa, Florida. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Pier Hotel calls itself the oldest continuously operating hotel in St. Petersburg, Florida. Built in 1921 near the waterfront, the hotel has 33 rooms and $1.3 million owing to secured creditors. A court filing lists the property as worth $675,000. Originally known as the Hotel Scott, the hotel was restored in 2000, according to the website. A case summary for Marrick Properties is in the May 14, 2012 edition of the Troubled Company Reporter. MILESTONE SCIENTIFIC: Incurs $355,000 Net Loss in First Quarter --------------------------------------------------------------- Milestone Scientific Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss applicable to common stockholders of $355,181 on $1.92 million of net product sales for the three months ended March 31, 2012, compared with a net loss applicable to common stockholders of $141,644 on $2.42 million of net product sales for the same period during the prior year. The Company reported a net loss of $1.48 million in 2011, compared with a net loss of $614,508 in 2010. The Company's balance sheet at March 31, 2012, showed $6.47 million in total assets, $4.62 million in total liabilities and $1.85 million in total stockholders' equity. A copy of the Form 10-Q is available for free at: http://is.gd/xdcVvI About Milestone Scientific Piscataway, N.J.-based Milestone Scientific Inc. (OTC BB: MLSS) -- http://www.milestonescientific.com/-- is engaged in pioneering proprietary, highly innovative technological solutions for the medical and dental markets. Central to the Company's IP platform and product development strategy is its patented CompuFlo(R) technology for the improved and painless delivery of local anesthetic. In its report on the Company's 2011 financial results, Holtz Rubenstein Reminick LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations since inception. MPG OFFICE: Files Form 10-Q, Posts $10.4-Mil. Net Income in Q1 -------------------------------------------------------------- MPG Office Trust, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $10.46 million on $87.99 million of total revenue for the three months ended March 31, 2012, compared with a net loss of $39.98 million on $79.33 million of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $2.19 billion in total assets, $3.11 billion in total liabilities, and a $913.35 million total deficit. A copy of the Form 10-Q is available for free at: http://is.gd/oCR0wZ The 2012 annual meeting of stockholders of the Company will be held on Friday, July 27, 2012, at 8:00 am (local time) at the Omni Los Angeles Hotel, located at 251 South Olive Street, Los Angeles, California 90012. At that time, holders of record of the Company's common stock will be asked to elect six directors and holders of record of the Company's 7.625% Series A Cumulative Redeemable Preferred Stock will be asked to elect two directors. Holders of record of the Company's common stock will also be asked to vote upon any and all such other matters as may properly come before the Annual Meeting. The Board has fixed the close of business on May 24, 2012, as the record date for the determination of stockholders entitled to notice of, and to vote at, the Annual Meeting and at any continuation, postponement or adjournment thereof. About MPG Office Trust MPG Office Trust, Inc., fka Maguire Properties Inc. -- http://www.mpgoffice.com/-- is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high- quality office properties in the Southern California market. MPG Office Trust is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. The Company has been focused on reducing debt, eliminating repayment and debt service guarantees, extending debt maturities and disposing of properties with negative cash flow. The first phase of the Company's restructuring efforts is substantially complete and resulted in the resolution of 18 assets, relieving the Company of approximately $2.0 billion of debt obligations and potential guaranties of approximately $150 million. The Company reported net income of $98.22 million in 2011, compared with a net loss of $197.93 million in 2010. MORGANS HOTEL: Incurs $14.5 Million Net Loss in First Quarter ------------------------------------------------------------- Morgans Hotel Group Co. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $14.49 million on $43.29 million of total revenues for the three months ended March 31, 2012, compared with a net loss of $32.86 million on $54.40 million of total revenues for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $544.25 million in total assets, $642.07 million in total liabilities, $5.41 million in redeemable noncontrolling interest, and a $103.23 million total deficit. About Morgans Hotel Group Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) -- http://www.morganshotelgroup.com/-- is widely credited as the creator of the first "boutique" hotel and a continuing leader of the hotel industry's boutique sector. Morgans Hotel Group operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and Shore Club in South Beach, Mondrian in Los Angeles and South Beach, Clift in San Francisco, Ames in Boston, and Sanderson and St Martins Lane in London. Morgans Hotel Group and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans Hotel Group also manages hotels in Isla Verde, Puerto Rico and Playa del Carmen, Mexico. Morgans Hotel Group has other property transactions in various stages of completion, including projects in SoHo, New York and Palm Springs, California. The Company reported a net loss of $87.95 million in 2011, a net loss of $83.64 million in 2010, and a net loss of $101.60 million in 2009. MSR RESORT: Judge Sides With Hilton in Property Management Row -------------------------------------------------------------- Lisa Uhlman at Bankruptcy Law360 reports that a New York bankruptcy judge ruled Friday for a Hilton Worldwide Inc. unit in a dispute with MSR Resort Golf Course LLC over a property management agreement, rejecting the debtor's claim that Hilton was equitably estopped from enforcing the deal. Law360 says MSR had sought a declaratory judgment that Hilton can't enforce so-called nondisturbance and attornment agreements that would give the company legal recourse for MSR's breach of the property management agreements because Hilton didn't disclose the NDAs in 2007 estoppel certificates. About MSR Resort MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc., owns a portfolio of eight luxury hotels with over 5,500 guest rooms, including the Arizona Biltmore Resort & Spa in Phoenix, the Ritz-Carlton in Orlando, Fla., and Hawaii's Grand Wailea Resort Hotel & Spa in Maui. On Jan. 28, 2011, CNL-AB LLC acquired the equity interests in the portfolio through a foreclosure proceeding. CNL-AB LLC is a joint venture consisting of affiliates of Paulson & Co. Inc., a joint venture affiliated with Winthrop Realty Trust, and affiliates of Capital Trust, Inc. Morgan Stanley's CNL Hotels & Resorts Inc. owned the resorts before the Jan. 28 foreclosure. Following the acquisition, five of the resorts with mortgage debt scheduled to mature on Feb. 1, 2011, were sent to Chapter 11 bankruptcy by the Paulson and Winthrop joint venture affiliates. MSR Resort Golf Course LLC and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan on Feb. 1, 2011. The resorts subject to the filings are Grand Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta Resort and Club and PGA West, Doral Golf Resort and Spa, and Claremont Resort and Spa. James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O. Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The five resorts had $2.2 billion in assets and $1.9 billion in debt as of Nov. 30, 2010, according to court filings. In its schedules, debtor MSR Resort disclosed $59,399,666 in total assets and $1,013,213,968 in total liabilities. The resorts have agreement with lenders allowing the companies to remain in Chapter 11 at least until September 2012. Donald Trump has a contract to buy the Doral Golf Resort and Spa in Miami for $170 million. There will be an auction to learn if there is a better bid. The resorts have said that Trump's offer price implies a value for all the properties "significantly" exceeding the $1.5 billion in debt. The Official Committee of Unsecured Creditors is represented by Martin G. Bunin, Esq., and Craig E. Freeman, Esq., at Alston & Bird LLP, in New York. NAVISTAR INTERNATIONAL: Wellington Ceases to Hold 5% Stake ---------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Wellington Management Company, LLP, disclosed that, as of April 30, 2012, it beneficially owns 269,805 shares of common stock of Navistar International Corporation representing 0.39% of the shares outstanding. Wellington previously reported beneficial ownership of 4,598,123 common shares or a 6.55% equity stake as of Dec. 31, 2011. A copy of the amended filing is available for free at http://is.gd/ITgbyX About Navistar International Navistar International Corporation (NYSE: NAV) -- http://www.Navistar.com/-- is a holding company whose subsidiaries and affiliates subsidiaries produce International(R) brand commercial and military trucks, MaxxForce(R) brand diesel engines, IC Bus(TM) brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse(R) brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The company also provides truck and diesel engine parts and service. Another affiliate offers financing services. The Company's balance sheet at Jan. 31, 2012, showed $11.50 billion in total assets, $11.69 billion in total liabilities, and a $195 million total stockholders' deficit. * * * Navistar has a 'BB-/Stable/--' corporate credit rating from Standard & Poor's and a 'B1' Corporate Family Rating and Probability of Default Rating from Moody's Investors Service. Moody's said in October 2010 that Navistar's B1 rating could improve if the North American truck market remains on track for a sustained recovery into 2011, and Navistar's operational initiatives to moderate its vulnerability to the truck cycle show evidence of taking hold. NAVISTAR INTERNATIONAL: Franklin Discloses 12.4% Equity Stake ------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Franklin Resources, Inc., disclosed that, as of Dec. 31, 2011, they beneficially own 8,498,858 shares of common stock of Navistar International Corporation representing 12.4% of the shares outstanding. A copy of the filing is available for free at http://is.gd/xk9X0l About Navistar International Navistar International Corporation (NYSE: NAV) -- http://www.Navistar.com/-- is a holding company whose subsidiaries and affiliates subsidiaries produce International(R) brand commercial and military trucks, MaxxForce(R) brand diesel engines, IC Bus(TM) brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse(R) brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The company also provides truck and diesel engine parts and service. Another affiliate offers financing services. The Company's balance sheet at Jan. 31, 2012, showed $11.50 billion in total assets, $11.69 billion in total liabilities, and a $195 million total stockholders' deficit. * * * Navistar has a 'BB-/Stable/--' corporate credit rating from Standard & Poor's and a 'B1' Corporate Family Rating and Probability of Default Rating from Moody's Investors Service. Moody's said in summary credit opinion at the end of April 2012 that the B1 Corporate Family Rating of Navistar International reflects the company's highly competitive position in the North American medium and heavy duty truck markets, and the continuing recovery in demand. It also reflects the progress Navistar continues to make in implementing a strategy that should reduce its vulnerability to cyclical downturns and strengthen returns. The key elements of this strategy include: expanding its scale and operating efficiencies by offering a full line of medium and heavy-duty trucks equipped with Navistar engines; building its position in international truck and engine markets through alliance and joint ventures; and, strengthening its domestic dealer network. NES RENTALS: Moody's Affirms 'Caa1' CFR, Rates Term Loan 'Caa2' --------------------------------------------------------------- Moody's Investors Service affirmed the credit ratings of NES Rentals Holdings, Inc., including the Corporate Family Rating of Caa1 and assigned a Caa2 rating to the proposed maturity extended second lien term loan. NES Rentals is in the process of amending and extending its $82.8 million senior secured second lien term loan. The amendment will extend the maturity of approving lenders from July 2013 to October 2014. Concurrently, the outlook was changed to positive from stable based on expected continued improvement in operating performance over the intermediate term with the Company being well positioned to capitalize on the improvement in the underlying factors supporting the positive U.S. equipment rental industry demand trends. Moody's has taken the following rating actions: Issuer: NES Rentals Holdings, Inc. Ratings Assigned: Second lien senior secured term loan due 2014 Caa2 (LGD-5, 83%) Ratings Affirmed (with updated LGD assessments): Corporate Family Rating, at Caa1 Probability of Default Rating, at Caa1 Second lien term loan due 2013, at Caa2 (LGD-5, 83%) from (LGD-5, 77%) $150 million second lien notes due 2015, at Caa2 (LGD-5, 83%) from (LGD-5, 77%) Outlook positive Ratings Rationale The change in rating outlook to positive reflects Moody's expectation of a continued moderate improvement in the overall US equipment rental markets and the factors underlying that growth. Continued growth over the intermediate term is expected to stem from higher rental rates and utilization through 2012 as well as continued anticipated growth in the industrial end-markets and to a lesser degree, growth in the non-residential construction industry. An improvement in operating results for NES in recent periods also confirms the expectation that this trend should continue as the overall industry recovers from the 2009 through mid-2010 economic downcycle. The company's proposed amendment and maturity date extension of its $83 million second lien term loan further support the positive outlook change as the company's debt maturity profile would be extended. However, Moody's notes that the proposed refinancing would also result in higher pricing on the second lien term loan, thereby increasing interest expense. The affirmation of the Caa1 corporate family rating reflects the high leverage and weak interest coverage. Although metrics have been improving, there continues to be uncertainty regarding the degree of expected U.S. economic growth and the highly cyclical nature of the equipment industry. In addition, due to the absence of a meaningful amount of free cash flow anticipated over the intermediate term, any meaningful credit metric improvement would likely emanate from EBITDA improvement rather than debt reduction. The ratings consider the company's adequate liquidity characterized by its anticipated moderately positive free cash flow as well as availability under its ABL facility that matures in 2014. The primary factor that would contribute to an improvement in NES' corporate family rating would include the sustainment of an adequate liquidity profile, debt/EBITDA below 6.0 times and EBIT to interest approaching 1 times (Moody's FM adjusted basis). The ratings and/or outlook would be negatively impacted if EBIT/interest turns negative, debt/EBITDA exceeds and is sustained above 6.0 times or if adequacy of the liquidity profile were to come into question. The principal methodology used in rating NES Rentals Holdings, Inc. was the Global Equipment and Automobile Rental Industry Methodology, published December 2010. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. NES Rentals Holdings, Inc., based in Chicago, Illinois and majority-owned by Diamond Castle Investments, is an equipment rental company in the U.S. NES has more than 70 branches across 27 states. Revenues for the last twelve months ended March 31, 2012 totaled $289 million. NEWPAGE CORP: Hearing Rescheduled Amid Dewey & LeBoeuf Woes ----------------------------------------------------------- In view of challenges facing Dewey & LeBoeuf LLP, the bankruptcy counsel to NewPage Corp., the Debtors, their creditors committee and the Debtors' prepetition lenders entered into a stipulation to adjourn to June 22 the hearing on the committee's request for standing to sue the lenders. The hearing was originally set for May 17. The deadline to object to the committee's request also has been moved to June 11. The reply deadline is now June 18. Meanwhile, the committee's deadline to make a challenge has been extended to June 26. According to the May 10 edition of the Troubled Company Reporter, citing a report by Bill Rochelle, the bankruptcy columnist for Bloomberg News, the Official Unsecured Creditors' Committee wants to sue secured lenders, contending that the debt-financed acquisition of the North American division of Stora Enso Oyj was a fraudulent transfer because the assets were pledged to secured lenders to raise cash for the deal. NewPage and its owners put no equity into the acquisition, the committee said. Two years later, when NewPage couldn't carry the debt load, the committee says the company "took on even more expensive replacement" debt. As a result, the committee argues it should be allowed to file a lawsuit to knock out the secured status of lenders providing the first-lien, second-lien and revolving credits. The committee noted that, in return for postpetition financing to support the Chapter 11 case, NewPage is barred from suing. About NewPage Group Headquartered in Miamisburg, Ohio, NewPage Corporation was the leading producer of printing and specialty papers in North America, based on production capacity, with $3.6 billion in net sales for the year ended Dec. 31, 2010. NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada. NewPage Group, NewPage Holding, NewPage, and certain of their U.S. subsidiaries commenced Chapter 11 voluntary cases (Bankr. D. Del. Case Nos. 11-12804 through 11-12817) on Sept. 7, 2011. Its subsidiary, Consolidated Water Power Company, is not a part of the Chapter 11 proceedings. Separately, on Sept. 6, 2011, its Canadian subsidiary, NewPage Port Hawkesbury Corp., brought a motion before the Supreme Court of Nova Scotia to commence proceedings to seek creditor protection under the Companies' Creditors Arrangement Act of Canada. NPPH is under the jurisdiction of the Canadian court and the court- appointed Monitor, Ernst & Young in the CCAA Proceedings. Initial orders were issued by the Supreme Court of Nova Scotia on Sept. 9, 2011 commencing the CCAA Proceedings and approving a settlement and transition agreement transferring certain current assets to NewPage against a settlement payment of $25 million and in exchange for being relieved of all liability associated with NPPH. On Sept. 16, 2011, production ceased at NPPH. Martin J. Bienenstock, Esq., Judy G.Z. Liu, Esq., and Philip M. Abelson, Esq., Dewey & LeBoeuf LLP, in New York, serve as counsel in the Chapter 11 case. Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serves as co- counsel. Lazard Freres & Co. LLC is the investment banker, and FTI Consulting Inc. is the financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. In its balance sheet, the Debtors disclosed $3.4 billion in assets and $4.2 billion in total liabilities as of June 30, 2011. The Official Committee of Unsecured Creditors is represented in the case by Quinn Emanuel Urquhart & Sullivan LLP and Young Conaway Stargatt & Taylor, LLP as counsel. Attorneys for the Bank of New York Mellon are: Robert J. Dehney, Esq. Daniel B. Butz, Esq. MORRIS NICHOLS ARSHT & TUNNELL LLP 1201 N. Market Street P.O. Box 1347 Wilmington, DE 19899-1347 Tel: 302-658-9200 Fax: 302-658-3989 - and - Dennis F. Dunne, Esq. Evan R. Fleck, Esq. Samuel A. Khalil, Esq. MILBANK, TWEED, HADLEY & McCLOY LLP 1 Chase Manhattan Plaza New York, NY 10005 Tel: 212-530-5000 Fax: 212-530-5219 - and - Andrew M. Leblanc, Esq. MILBANK, TWEED, HADLEY & McCLOY LLP 1850 K Street NW, Suite 1100 Washington, DC 20006 Tel: 202-835-7500 Fax: 202-263-7586 - and - Edward Zujkowski, Esq. Paul T. Weinstein, Esq. EMMET MARVIN & MARTIN, LLP 120 Broadway New York, NY 10271 Tel: 212-238-3090 Fax: 212-238-3100 The ad hoc group of second lien noteholders is represented by: Ira S. Dizengoff, Esq. Philip C. Dublin, Esq. Joanna F. Newdeck, Esq. AKIN GUMP STRAUSS HAUER & FELD LLP One Bryant Park New York, NY 10036-6745 Tel: 212-872-1000 Fax: 212-872-1002 Wilmington Trust, N.A., is represented by: Patrick Sibley, Esq. PRYOR CASHMAN LLP 7 Times Square New York, NY 10036 Tel: 212-326-0152 Fax: 212-798-6332 NewPage prevailed over most objections from the official creditors' committee and won agreement from the bankruptcy judge on final approval of $600 million in secured financing. Moody's Investors Service assigned a Ba2 rating to the $350 million first-out revolving debtor-in-possession credit facility and a B2 rating to the $250 million second-out debtor-in- possession term loan for NewPage. NO FEAR RETAIL: Liquidated, Paying Unsecured Creditors 2% to 6% --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that creditors of No Fear Retail Stores Inc. will be paid 2% or 6% of their claims, depending on which of the related companies owes the debt, as the result of approval the bankruptcy court gave last week to a liquidating Chapter 11 plan. All creditor classes voted in favor of the plan. Creditors of Simo Holdings Inc. are to receive 6% of their $22.4 million in claims, according to the disclosure statement explaining the plan. Creditors of No Fear MX, with about $1 million in claims, are anticipated to take home 2%, as are creditors of No Fear Retail Stores on their $10.6 million in claims. The report recounts that when it became evident the retailer couldn't survive on its own, sales were organized. Ryderz Compound Inc. bought the inventory and store operations under a contract valued at $3.08 million. Ryderz won the auction bidding against liquidators, thus saving jobs of store employees. Separately, the trademarks and intellectual property were sold to Brands Holdings Ltd. under a contract valued at $11.1 million. Brands opened the auction with a bid of $6.25 million. The sales were enough to pay off secured debt, including a $3.6 million loan to finance the Chapter 11 case. About No Fear Retail Carlsbad, California-based No Fear Retail Stores, Inc., was a retailer of action, sports, and casual youth lifestyle apparel and accessories, targeting young adults and teens. It operated 41 retail locations in California, Oregon, Arizona, Florida, Nevada, North Carolina, and Texas. No Fear filed for Chapter 11 bankruptcy protection (Bankr. S.D. Calif. Case No. 11-02896) on Feb. 24, 2011. David S. Kupetz, Esq., at Sulmeyer, Kupetz, A Professional Corp, serves as the Debtor's bankruptcy counsel. The Debtor tapped Jones Day as special intellectual property counsel; Avant Advisory Group's George Blanco as chief restructuring officer, and Venturi & Company LLC, as financial advisors. The Debtor estimated disclosed $31,648,063 in assets and $12,552,985 in liabilities as of the Chapter 11 filing. Affiliates No Fear MX, Inc. (Bankr. S.D. Calif. Case No. 11-02897) and Simo Holdings, Inc. (Bankr. S.D. Calif. Case No. 11-02898) filed separate Chapter 11 petitions on Feb. 24, 2011. Tiffany L. Carroll, the Acting U.S. Trustee for Region 15, appointed three creditors to serve on an Official Committee of Unsecured Creditors of No Fear MX. Pachulski Stang Ziehl & Jones LLP represents the Committee. BDO USA LLP serves as financial advisor to provide financial advisory services to the Committee. Gibson Dunn & Crutcher LLP is the counsel for the Debtors' creditors panel. Lapidus & Lapidus acts as special litigation Counsel for the Debtors. NORTEL NETWORKS: Close to Ending Fight With Asian Units ------------------------------------------------------- American Bankruptcy Institute reports that Nortel Networks Inc., the telecommunications company being liquidated in bankruptcy, may soon settle a fight with its Asian and Latin American units over their share of more than $7 billion Nortel made from asset sales. About Nortel Networks Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Office of the United States Trustee for the District of Delaware has appointed an Official Committee of Unsecured Creditors in respect of the Debtors, and an ad hoc group of bondholders has been organized. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. The Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel has collected almost $9 billion for distribution to creditors. Of the total, US$4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. NORTEL NETWORKS: In Mediation With Asian, LatAm Affiliates ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Nortel Networks Inc. is mediating with affiliates from Asia and Latin America over how to divvy up proceeds from the sale of the companies' assets. Nortel is also in mediation with European affiliates under supervision of Ontario Chief Justice Warren K. Winkler with regard to intercompany claims. Mediation is intended to devise a formula dividing sale proceeds among the Nortel companies in the U.S., Canada and abroad. About Nortel Networks Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was once North America's largest communications equipment provider. It has sold most of the businesses while in bankruptcy. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor sought recognition of the CCAA Proceedings in the U.S. by filing a bankruptcy petition under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's counsel. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Office of the United States Trustee for the District of Delaware has appointed an Official Committee of Unsecured Creditors in respect of the Debtors, and an ad hoc group of bondholders has been organized. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. The Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel has collected almost $9 billion for distribution to creditors. Of the total, US$4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. NORTHCORE TECHNOLOGIES: Envision Wins Consumers Choice Award ------------------------------------------------------------ Northcore Technologies Inc.'s portfolio company, Envision Online Media Inc. has received a Consumers Choice Award. As previously announced, Northcore has acquired Envision, an Ottawa based software development company and Microsoft Partner. Envision has been one of the most respected boutique solutions providers in the National Capital Area for over a decade and brings a complementary product and skill set to Northcore. The Consumer Choice Award for Business Excellence was received in the category of Internet Web Design and was the result of a sophisticated polling process. The research was undertaken by the largest independent Canadian-owned research company, L�ger Marketing. The Consumer Choice Award Group is unique in that it is the only organization in North America to recognize business excellence by conducting research that surveys both the consumer and business community with statistical accuracy. "We have been very impressed with Todd Jamieson and his team," said Amit Monga, CEO of Northcore Technologies. "This award provides further evidence of the superior level of customer service that is the standard practice at Envision. The focus on client satisfaction is one of the core values we share as an enterprise and was an important factor in our acquisition." Further disclosure on Envision's portfolio and capabilities can be found on their web presence located at www.envisiononline.ca. About Northcore Toronto, Ontario-based Northcore Technologies Inc. (TSX: NTI; OTC BB: NTLNF) -- http://www.northcore.com/-- provides a Working Capital Engine(TM) that helps organizations source, manage, appraise and sell their capital equipment. Northcore offers its software solutions and support services to a growing number of customers in a variety of sectors including financial services, manufacturing, oil and gas and government. Northcore owns 50% of GE Asset Manager, LLC, a joint business venture with GE. Together, the companies work with leading organizations around the world to help them liberate more capital value from their assets. The Company reported a loss and comprehensive loss of C$3.93 million in 2011, compared with a loss and comprehensive loss of C$3.03 million in 2010. The Company's balance sheet at Dec. 31, 2011, showed C$2.91 million in total assets, C$415,000 in total liabilities and C$2.49 million in total shareholders' equity. NRG ENERGY: Moody's Changes Outlook to Negative, Retains Ba3 CFR ---------------------------------------------------------------- Moody's Investors Service changed the rating outlook for NRG Energy, Inc. to negative from stable while affirming the company's long-term ratings. Concurrent with this rating action, Moody's changed NRG's Speculative Grade Liquidity Rating to SGL-2 from SGL-1. Ratings affirmed include the company's Corporate Family Rating (CFR) and Probability of Default Rating (PDR) at Ba3, its senior secured rating at Baa3, and its senior unsecured debt at B1. "The change in rating outlook to negative reflects the expected deterioration in credit metrics due to the challenging macro environment for unregulated power companies which is compressing margins and weakening sustained cash flow", said A.J. Sabatelle, Senior Vice President of Moody's. "The rating affirmation factors in the company's capital investment program which is substantial and multi-faceted, and expected to be funded by either internal sources or previously arranged financing agreements." Ratings Rationale NRG's Ba3 CFR reflects the relatively strong historical credit metrics based upon margins that were underpinned by hedges, contracts or sales from NRG's retail business. For the last three fiscal years, Moody's calculates the ratio of CFO pre-W/C (cash flow) to debt averaged 16.4%, cash flow coverage of interest expense averaged 3.3x, and the ratio of free cash flow to debt averaged nearly 4.5%, comfortably positioning NRG in the "Ba" rating category. However, consolidated financial results deteriorated materially during 2011 and during the twelve months ending 03/31/3012. Specifically, Moody's calculates that cash flow to debt declined to 10.6% and 9.1%, respectively, and cash flow coverage of interest was 2.5x and 2.3x, respectively, over these two most recent periods. In light of the expected continuation of low natural gas prices, a weak economic recovery, and continued fuel switching from coal to natural gas, Moody's would anticipate NRG's performance to be similar to its most recent results for the next several years. Moody's recognizes that some of the deterioration in financial performance can be attributed to the incurrence of approximately $1.7 billion of additional debt to finance the construction of solar generation plants and a natural gas fired plant being retrofitted in the Western US. Moody's further acknowledges that all of these projects have long-term power purchase agreements in place with investment grade counterparties which Moody's views favorably from a credit perspective since they will provide a high degree of cash flow certainty over the next several years. Moody's consolidates all debt obligations when calculating NRG's credit metrics. These key credit metrics still show deterioration to levels more in line with a "high B-rated" unregulated power company even if one excludes the $1.7 billion of project level debt, given the approximate $600 million decline in cash flow incurred during 2011 and the 12 months ending 03/31/2012. In light of current expectations for power prices over the next several years, Moody's believes that NRG's financial metrics are likely to remain in line with other "B- rated" unregulated power issuers, with cash flow to debt at around 10% and cash flow coverage of interest at 2.5x. The negative outlook further factors in the margin erosion that has occurred and expected to continue in both NRG's wholesale and retail operations. Not surprisingly, low natural gas prices, a struggling economy, decline in capacity prices, lower volumes from coal to gas switching, and higher coal prices are all contributing factors to the 22% decline in the wholesale power segment's gross margin experienced during 2011. Of additional concern is the margin decline witnessed in the retail business, a segment that NRG believes should offset the expected weak results in wholesale. Specifically, Moody's calculates that Reliant's gross margin per kilowatt hour of electricity sold declined by 13.7% during 2011 and by an additional 6.2% during the first quarter 2012. Some of this decline can be attributed to the costs associated with adding new customers which is a company focus. However, Moody's remains skeptical about the company's ability to continue to add customers and maintain margins in light of the competitive pressures and the already thin margins that exist in the retail business. The rating affirmation considers the company's large capital spending program which is multi-dimensional covering traditional and non-traditional aspects of the sector. While funding for these programs has been arranged, Moody's is guarded about the size ($2.7 billion for the 12 months ending 03/31/2012) and the complexity of aspects of the program, particularly for a company whose market capitalization hovers around $3.7 billion. Additionally, the company plans to implement a common dividend of $0.36 share or about $80 million annually with the first quarterly payment expected to occur during the second half of 2012. Moody's understands that the size of the dividend is expected to have some relationship with the earnings stream expected from the company's solar investments. While the introduction of the common dividend will predictably return capital to shareholders over the next several years, it may have delayed the implementation of additional share repurchases. Nevertheless, Moody's believes that the company will continue to pursue initiatives that provides greater financial flexibility for future shareholder rewards programs. In the end, the manner in which NRG manages its discretionary capital remains an important rating factor. The ratings for NRG's individual securities were determined using Moody's Loss Given Default (LGD) methodology. Moody's observes that changes to the capital structure at NRG which increases the relative amount of secured debt while decreasing the relative amount of unsecured debt could result in a lower instrument rating for the senior secured revolver, the secured term loan, the Dunkirk Power bonds, and the Indian River Power bonds, even if NRG's fundamental credit quality remains unchanged. NRG's speculative grade liquidity rating of SGL-2 reflects Moody's expectation that the company will maintain a good liquidity profile over the next 4-quarter period as a result of internal cash flow generation plus continued access to credit availability, continued headroom under the company's covenants and the ability to raise cash from asset sales, if necessary. Total liquidity at March 31, 2011, was approximately $2.4 billion, including credit facility availability of approximately $1.2 billion and unrestricted cash on hand of around $1.0 billion. NRG has publicly stated that its minimum unrestricted cash balance is $700 million, which Moody's believes is a weakness in NRG's current liquidity profile given the size of the company's near-term capital spend. NRG's liquidity is aided by the existence of standalone financing arrangements to fund the capital investments for the construction of solar generation power plants and the retrofitting of its natural gas-fired plants. Moody's anticipates that the decline in energy margins will reduce the headroom under the company's financial covenants but Moody's anticipates the company to remain comfortably in compliance on a ongoing basis. Moody's also observes that NRG owns assets that could be monetized for additional liquidity. Also, from a collateral hedging standpoint, NRG's working capital requirements continue to be aided by the company's ownership of affiliated retail supply businesses, which collectively reduce potential collateral posting requirements. The negative rating outlook reflects the margin erosion that is occurring in both NRG's wholesale and retail operations, which is contributing to financial performance more in line with a "B" rated unregulated power issuer. The negative rating outlook further considers the company's very large capital spending program anticipated over the next few years, particularly when compared to NRG's market capitalization of approximately $3.7 billion. While previously arranged standalone financing arrangements help to mitigate the liquidity and funding risk for the current capital program, the negative outlook reflects Moody's belief that management will continue to pursue initiatives that facilitate the implementation of shareholder reward programs or make capital investments that are less supportive of credit quality. In light of the negative rating outlook, the substantial capital investment program, and the continued weak market for unregulated power in most regions, limited prospects exist for the ratings to be upgraded in the near-term. However, to the extent that management is able to complete the construction of its numerous solar project investments on a timely basis, unregulated power margins show modest levels of improvement, and future capital spending materially abates, the ratings outlook could stabilize. The rating could be downgraded should material problems surface with the company's growth strategies, if weaker than expected market conditions persist across NRG's generation fleet or if the company materially alters its capital allocation program in a way detrimental to creditors. The methodologies used in this rating were Unregulated Utilities and Power Companies published in August 2009, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Princeton, New Jersey, NRG's power plants provide approximately 25,000 megawatts of generation capacity, primarily in Texas and the northeast, south central and western regions of the US. NRG's retail businesses, Reliant Energy, Green Mountain Energy, and Energy Plus, combined serve more than 2 million residential, business, commercial and industrial customers in Texas and, increasingly in select markets in the northeast US. NRG also owns generating facilities in Australia and Germany. OILSANDS QUEST: CCAA Creditor Protection Extended to June 29 ------------------------------------------------------------ Oilsands Quest Inc. has requested and obtained an extension of the order from the Alberta Court of Queen's Bench providing creditor protection under the Companies' Creditors Arrangement Act, which was to expire May 18, 2012. Creditor protection under the CCAA will now expire on June 29, 2012, unless further extended as required and approved by the Court. As previously announced, Oilsands Quest is conducting a process to solicit offers to acquire, restructure or recapitalize the Company, with the assistance TD Securities Inc. While various proposals were received from potential investors, none of these proposals are currently in a form that the Company believes would result in a sale or investment that would be in the best interests of Oilsands Quest or its stakeholders. Negotiations are continuing to determine whether certain of the proposals could be amended to form the basis of an acceptable transaction to be brought before stakeholders and the Court for approval. There can be no assurance that the Solicitation Process will result in a financing or a sale of the Company or in any other transaction. Trading in the common shares of Oilsands Quest remains suspended while the NYSE Amex determines whether to resume trading or to delist the Company for failure to meet listing requirements. About Oilsands Quest Oilsands Quest Inc. -- http://www.oilsandsquest.com/-- is exploring and developing oil sands permits and licences, located in Saskatchewan and Alberta, and developing Saskatchewan's first commercial oil sands discovery. OMNICOMM SYSTEMS: Incurs $3.4 Million Net Loss in First Quarter --------------------------------------------------------------- OmniComm Systems, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $3.37 million on $3.76 million of total revenues for the three months ended March 31, 2012, compared with a net loss of $3.89 million on $3.31 million of total revenues for the same period during the prior year. The Company's balance sheet at March 31, 2012, showed $3.38 million in total assets, $27.94 million in total liabilities and a $24.55 million total shareholders' deficit. The Company said that its ability to continue in existence is dependent on its having sufficient financial resources to bring products and services to market for marketplace acceptance. As a result of the Company's historical operating losses, negative cash flows and accumulated deficits for the period ending March 31, 2012, there is substantial doubt about the Company's ability to continue as a going concern. A copy of the Form 10-Q is available for free at: http://is.gd/GzeafB About OmniComm Systems Ft. Lauderdale, Fla.-based OmniComm Systems, Inc. (OTC: OMCM.OB) -- http://www.OmniComm.com/-- provides customer-driven Internet solutions to pharmaceutical, biotechnology, research and medical device organizations that conduct life changing clinical trial research. OmniComm Systems, Inc has U.S. headquarters in Fort Lauderdale, Fla. and European headquarters in Bonn, Germany, with satellite offices in New Jersey and the United Kingdom, as well as sales offices throughout the U.S. and Europe. OmniComm Systems reported a net loss of $3.52 million in 2011, compared with a net loss of $3.13 million in 2010. Webb & Company, P.A., in Boynton Beach, Florida, expressed substantial doubt about the Company's ability to continue as a going concern following the 2011 financial results. The independent auditors noted that the Company has a net loss attributable to common shareholders of $3.73 million, a negative cash flow from operations of $311,000, a working capital deficiency of $6.68 million, and a stockholders' deficiency of $21.2 million. OTTILIO PROPERTIES: Files for Chapter 11 Anew --------------------------------------------- Totowa, New Jersey-based Ottilio Properties LLC filed a bare-bones Chapter 11 petition (Bankr. D.N.J. Case No. 12-22318) in Newark on May 11, 2012. According to the docket, the schedules of assets and liabilities and statement of financial affairs are due May 25, 2012. The Debtor's exclusive right to file a plan expires Sept. 10, 2012. The Debtor estimated assets of up to $50 million and debt of up to $10 million in its Chapter 11 petition. According to NorthJersey.com, Otillo Properties owns the Ottilio Building at 555 Preakness Avenue. The building, built in the 1960s, is a well-known architectural oddity in Totowa. The building was erected by demolition contractor Carmen Ottilio, who adorned the lobby with stone fixtures from the old Paramount Theater in Manhattan and installed at the entrance a 20-foot-high wrought-iron gate, salvaged from the Vatican pavilion at the 1964 New York World's Fair. Ottilio Properties first filed a Chapter 11 petition (Bankr. D.N.J. Case No. 11-34641) on Aug. 18, 2011. But in December 2011, Valley National Bank successfully won dismissal of the case arguing that the filing was made in bad faith, as it was a desperate effort to delay a foreclosure sale. The Hon. Morris Stern dismissed the 2011 case. Judge Stern has been assigned to the new case. OVERLAND STORAGE: Incurs $3.8 Million Net Loss in March 31 Qtr. --------------------------------------------------------------- Overland Storage reported a net loss of $3.82 million on $15.15 million of net revenue for the three months ended March 31, 2012, compared with a net loss of $3.36 million on $17.12 million of net revenue for the same period during the prior year. The Company reported a net loss of $13.46 million on $44.33 million of net revenue for the nine months ended March 31, 2012, compared with a net loss of $10.77 million on $52.62 million of net revenue for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $41.32 million in total assets, $37.30 million in total liabilities and $4.02 million in shareholders' equity. "We've made significant progress towards achieving our strategic objectives and positioning Overland Storage for growth and profitability," said Eric Kelly, President and CEO of Overland Storage. "Our ability to sequentially grow revenue from our fiscal second to third quarter for the first time in five years confirms that the strategy we have established is beginning to take hold. In addition, our SnapServer DX Series revenue more than doubled, which further validates the investments we have made in these products." A copy of the press release is available for free at: http://is.gd/1mS4of About Overland Storage San Diego, Calif.-based Overland Storage, Inc. (Nasdaq: OVRL) -- http://www.overlandstorage.com/-- is a global provider of unified data management and data protection solutions designed to enable small and medium enterprises (SMEs), corporate departments and small and medium businesses (SMBs) to anticipate and respond to change. The Company reported a net loss of $14.50 million on $70.19 million of net revenue for the fiscal year ended June 30, 2011, compared with a net loss of $12.96 million on $77.66 million of net revenue during the prior fiscal year. Moss Adams LLP, in San Diego, California, noted that the Company's recurring losses and negative operating cash flows raise substantial doubt about the Company's ability to continue as a going concern. PEGASUS RURAL: Xanadoo to Hold June 26 Auction for Tower Assets --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports the bankrupt subsidiaries of Xanadoo Co. will hold an auction on June 26 to learn whether anyone will pay more than the $3 million offered by Rhino Communications Inc. for the tower facilities. Under auction and sale procedures approved May 10 by the bankruptcy court in Delaware, competing bids are due June 19. A hearing to approve the sale will take place June 28. Separately, the Xanadoo companies, according to the report, arranged a May 23 hearing for approval of an auction in August to sell most of the frequency assets. The company is reserving the right to cancel the auction and instead propose a reorganization plan supported by financing to enable an emergence from Chapter 11. No buyer is yet under contract for the frequency sale. About Pegasus Rural Broadband Pegasus Rural Broadband, LLC, and its affiliates, including Xanadoo Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 11-11772) on June 10, 2011. The Debtors are subsidiaries of Xanadoo Company, a 4G wireless Internet provider. Xanadoo Co. was not among the Chapter 11 filers. The subsidiaries sought Chapter 11 protection after they were unable to restructure $52 million in 12.5% senior secured promissory notes that matured in May. The notes are owing to Beach Point Capital Management LP. Xanadoo Holdings, through Xanadoo LLC -- XLC -- offers wireless high-speed broadband service, including digital phone services, under the Xanadoo brand utilizing licensed frequencies in the 2.5 GHz frequency band. As of May 31, 2011, XLC served 12,000 subscribers in Texas, Oklahoma and Illinois. In the summer of 2010, the Debtors closed all of their retail stores and kiosks in its six operating markets and severed all fulltime sales personnel. Since the closings, the Debtors relied one key retailer in each market to serve as local point of presence to market customer transactions. Judge Peter J. Walsh presides over the case. Rafael Xavier Zahralddin-Aravena, Esq., Shelley A. Kinsella, Esq., and Jonathan M. Stemerman, Esq., at Elliott Greenleaf, in Wilmington, Delaware, serve as counsel to the Debtor. NHB Advisors Inc. is their financial advisors. Epiq Systems, Inc., is the claims and notice agent. Xanadoo Holdings, Pegasus Guard Band and Xanadoo Spectrum each estimated assets of $100 million to $500 million and debts of $50 million to $100 million. The Chapter 11 filing followed the maturity in May 2011 of almost $60 million in secured notes owing to Beach Point Capital Management LP. The Court denied a motion by the secured noteholders to dismiss the Chapter 11 case and appoint a Chapter 11 trustee. The companies filed a proposed reorganization plan in February predicting sale of licenses in the 700 megahertz spectrum would pay all secured and unsecured creditors in full, with interest. In a separate filing, the companies said the assets will be turned over to secured lenders if there is neither a lender nor a buyer to finance a plan. The plan will be funded either by a new loan or by selling the business and the assets. PINNACLE AIRLINES: Steelworkers Object to $74.3MM DIP Deal ---------------------------------------------------------- Jamie Santo at Bankruptcy Law360 reports that the United Steelworkers objected in a New York court Thursday to Pinnacle Airlines Corp.'s request for $74.3 million in financing, claiming the proposed package comes with conditions that would hamstring the bankrupt regional airline and impair collective bargaining with the union. Law360 relates that Pinnacle offers flights from hubs to smaller outlying cities for ticketed passengers of Delta Air Lines Inc. and United Airlines Inc. As part of its Chapter 11 filing, Pinnacle said it would obtain a $74.3 million debtor-in-possession loan from Delta. About Pinnacle Airlines Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/-- a $1 billion airline holding company with 7,800 employees, is the parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.; and Colgan Air, Inc. Flying as Delta Connection, United Express and US Airways Express, Pinnacle Airlines Corp. operating subsidiaries operate 199 regional jets and 80 turboprops on more than 1,540 daily flights to 188 cities and towns in the United States, Canada, Mexico and Belize. Corporate offices are located in Memphis, Tenn., and hub operations are located at 11 major U.S. airports. Pinnacle Airlines Inc. and its affiliates, including Colgan Air, Mesaba Aviation Inc., Pinnacle Airlines Corp., and Pinnacle East Coast Operations Inc. filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Lead Case No. 12-11343) on April 1, 2012. Judge Robert E. Gerber presides over the case. Lawyers at Davis Polk & Wardwell LLP, and Akin Gump Strauss Hauer & Feld LLP serve as the Debtors' counsel. Barclays Capital and Seabury Group LLC serve as the Debtors' financial advisors. Epiq Systems - Bankruptcy Solutions serves as the claims and noticing agent. The petition was signed by John Spanjers, executive vice president and chief operating officer. Pinnacle Airlines' balance sheet at Sept. 30, 2011, showed $1.53 billion in total assets, $1.42 billion in total liabilities and $112.31 million in total stockholders' equity. Delta Air Lines, Inc., the Debtors' major customer and post- petition lender, is represented by David R. Seligman, Esq., at Kirkland & Ellis LLP. A seven-member official committee of unsecured creditors has been appointed in the case. The Committee selected Goodrich Corporation as its chairperson. The Committee tapped Morrison & Foerster LLP as its counsel. PRINCE SPORTS: Agrees to License Iconic Brands to Battle Sports --------------------------------------------------------------- Jamie Santo at Bankruptcy Law360 reports that Prince Sports Inc. agreed Wednesday to license its iconic brands to Battle Sports Science LLC in a deal that will return at least $15 million to the ailing tennis equipment supplier and keep it in the game for the upcoming season. Law360 says the agreement, which requires the approval of a Delaware bankruptcy judge, allows Battle Sports Science the right to source, market and distribute Prince products in the U.S. through the end of 2017. About Prince Sports Prince Sports, Inc. and its U.S. affiliates filed voluntary petitions for Chapter 11 reorganization (Bankr. D. Del. Lead Case NO. 12-11439) on May 1, 2012, with a Chapter 11 plan that contemplates the transfer of ownership to Authentic Brands Group (ABG)-Prince LLC. Founded in 1970, Prince Sports has a 42-year track record of developing premium quality products for the racquet sports industry. The Company pioneered many innovative designs, including the "oversized" racquet, the "longbody" racquet, and technology for racquet applications such as Triple Threat, 03 and EX03. Prince sells its products through brands like "Ektelon," which sells racquetball racquets, footwear and gloves and "Viking Athletics," through which it sells platform tennis paddles, balls and gloves. Prince is distributed in over 100 countries. Lincolnshire Management Inc. acquired Prince from Benneton Group, the parent company of United Colors of Benneton, in 2003. Lincolnshire Management sold Prince to Nautic Partners in August 2007. The Debtor has a Chapter 11 plan where (ABG)-Prince LLC, which acquired the secured debt from GE Capital and Madison Capital, will be acquiring 100% of the new equity in exchange of the discharge of the debt. Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the Debtors. The Debtors have also tapped FTI Consultin, Inc., to provide David J. Woodward as Chief Restructuring Officer, and provide additional personnel. Epiq Bankruptcy Solutions LLC is the claims and notice agent. PSS WORLD: Moody's Says Strategic Transformation Plan Credit Neg ---------------------------------------------------------------- Moody's Investors Service said that PSS World Medical, Inc.'s ratings are unaffected by the company's announcement that it has embarked on a strategic transformation plan. The announcement is slightly credit negative because of execution risk and its net negative impact on EBITDA. As reported by the Troubled Company Reporter-Europe on Feb. 15, 2012, Moody's assigned Ba3 corporate family and probability of default ratings to PSS World. In addition, Moody's assigned a Ba3 rating to the proposed $250 million notes, due 2022 and a SGL-2 speculative grade liquidity rating. PSS World is expected to use the proceeds from the proposed notes issuance to repay borrowings under its credit facility and partially pre-fund the repayment of 2008 convertible notes. The outlook is stable. These ratings were assigned: Corporate family rating, assigned Ba3; Probability of default rating, assigned Ba3; $250 million senior unsecured notes, assigned Ba3 (LGD4, 51%); Speculative grade liquidity rating, assigned SGL-2. PSS World is a national distributor of medical products and supplies, healthcare information technology, and pharmaceutical products and provider of professional and consulting services to the physician, long-term care, assisted living, home health care and hospice markets. The company's revenues for the year ended March 30, 2012 were $2.1 billion. QUANTUM FUEL: Incurs $7.8 Million Net Loss in First Quarter ----------------------------------------------------------- Quantum Fuel Systems Technologies Worldwide, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to stockholders of $7.81 million on $5.99 million of total revenue for the three months ended March 31, 2012, compared with a net loss attributable to stockholders of $5.25 million on $6.75 million of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $51.54 million in total assets, $17.48 million in total liabilities, and $34.06 million in total stockholders' equity. Alan P. Niedzwiecki, President and CEO, stated, "We continue to expand our natural gas tank sales which is driving revenue growth, which we expect to continue in calendar 2012." Mr. Niedzwiecki continued, "The renewable energy side of our business is also expanding with our recent acquisition of the Zephyr Wind Farm, which added 10 megawatts of electricity generation capacity to our renewable energy portfolio. We intend to continue the development efforts on certain renewable energy projects with strategic partners as we build out the renewable energy segment of our business." Going Concern Based on current projections and estimates, the Company does not believe its principal sources of liquidity will be sufficient to fund its operating activities and obligations as they become due over the next twelve months. In order for the Company to have sufficient capital to execute its business plan, fund its operations and meet its debt obligations over this twelve month period, the Company will need to extend the maturity dates of the $4.0 million of convertible debt that the Company refers to as the "Unsecured 'B' Convertible Notes" that come due in the fourth quarter of 2012 and raise additional capital. Although the Company has been successful in the past in extending its debt obligations and raising debt and equity capital, the Company cannot provide any assurance that it will be successful in doing so in the future to the extent necessary to be able to fund all of its business plans, operating activities and obligations through March 31, 2013, which raises substantial doubt about the Company's ability to continue as a going concern. A copy of the Form 10-Q is available for free at: http://is.gd/jOPnL7 About Quantum Fuel Based in Irvine, California, Quantum Fuel Systems Technologies Worldwide, Inc., is a fully integrated alternative energy company and considers itself a leader in the development and production of advanced clean propulsion systems and renewable energy generation systems and services. Quantum Fuel reported a net loss attributable to stockholders of $38.49 million on $24.47 million of total revenue for the eight months ended Dec. 31, 2011, compared with a net loss attributable to stockholders of $6.52 million on $10.51 million of total revenue for the same period a year ago. The Company reported a net loss of $11.03 million for the year ended April 30, 2011, following a net loss of $46.29 million during the prior year. Haskell & White LLP, in Irvine, California, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that Company incurred significant operating losses and used a significant amount of cash in operations during the eight months ended Dec. 31, 2011. QUIGLEY CO: Not Abandoning Reorganization After Loss on Appeal -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Quigley Co. told the bankruptcy judge Thursday that the company will remain in Chapter 11 and attempt to emerge by September regardless of an April opinion from a federal appeals court. Pfizer Inc. may attempt a final appeal to the U.S. Supreme Court, the bankruptcy judge was told. As reported in the April 12 edition of the Troubled Company Reporter, the U.S. Court of Appeals in Manhattan wrote a 34-page opinion April 10 and upheld the district court ruling that parent Pfizer isn't entitled to complete protection from asbestos claims under the umbrella of Quigley's Chapter 11 case. The circuit court, in an opinion by Circuit Judge Debra Ann Livingston, ruled that Quigley's bankruptcy can't protect Pfizer against claims it was the "apparent manufacturer" of an asbestos-laden product even though Quigley was the actual manufacturer. A copy of the Second Circuit's decision is available at http://is.gd/9p0AXGfrom Leagle.com. The appeal in the circuit court was Quigley Co. Inc. v. Law Offices of Peter G. Angelos (In re Quigley Co. Inc.), 11-2635, U.S. Court of Appeals for the Second Circuit (Manhattan). The appeal in district court was In re Quigley Co. Inc., 10-01573, U.S. District Court, Southern District of New York (Manhattan). About Quigley Co. Quigley Co. was acquired by Pfizer in 1968 and sold small amounts of products containing asbestos until the early 1970s. In September 2004, Pfizer and Quigley took steps that were intended to resolve all pending and future claims against the Company and Quigley in which the claimants allege personal injury from exposure to Quigley products containing asbestos, silica or mixed dust. Quigley filed for bankruptcy in 2004 and has a Chapter 11 plan and a settlement with Chrysler. Quigley filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 04-15739) on Sept. 3, 2004, to implement a proposed global resolution of all pending and future asbestos- related personal injury liabilities. Lawrence V. Gelber, Esq., and Michael L. Cook, Esq., at Schulte Roth & Zabel LLP, represent the Debtor in its restructuring efforts. Elihu Inselbuchm Esq., at Caplin & Drysdale, Chartered, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it disclosed $155,187,000 in total assets and $141,933,000 in total debts. In April 2011, the bankruptcy judge approved a plan-support agreement with Pfizer and an ad hoc committee representing 30,000 asbestors claimants. A May 20, 2011 opinion by District Judge Richard Holwell concluded that Pfizer was directly liable for some asbestos claims arising from products sold by its now non-operating subsidiary Quigley. REDDY ICE: Debtors and Creditors Oppose Official Equity Committee ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Reddy Ice Holdings Inc. and the official committee representing unsecured creditors oppose creation of an additional official committee to represent shareholders. The Debtor and the unsecured creditors committee agree that the company is insolvent, meaning that the 17 cents is a "gift," they say. By seeking an official equity committee, shareholders are "requesting that the estates pay for its legal expenses in trying to negotiate a bigger gift," the committee's counsel from Pachulski Stang Ziehl & Jones LLP said in a filing with the U.S. Bankruptcy Court in Dallas, according to the report. The report relates that to justify having an official committee, the shareholders contend that the company is solvent. Reddy Ice, as evidence of insolvency, pointed to a regulatory filing as of Dec. 31 showing $434 million in assets surpassed by $531 million in liabilities. The company also noted that the second-lien notes traded at an average of 37 cents on the dollar this year, and in a range between 18 cents and 29 cents since the Chapter 11 filing. The notes traded Thursday for 25.5 cents, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. About Reddy Ice Reddy Ice Holdings Inc. and wholly owned subsidiary Reddy Ice Corp. manufacture and distribute packaged ice in the United States. As of Dec. 31, 2011, the Company had assets totaling $434 million and total liabilities of $531 million. The bulk of the liabilities were total debt outstanding of $471.5 million. Reddy Holdings and Reddy Corp. on April 12, 2012, filed voluntary Chapter 11 bankruptcy petitions (Bankr. N.D. Tex. Case Nos. 12- 32349 and 12-32350) together with a plan of reorganization and accompanying disclosure statement to complete a previously announced plan to strengthen its balance sheet and ensure strong financial footing for the future. As part of the restructuring, Reddy Ice seeks to pursue a strategic acquisition of all or substantially all of the businesses and assets of Arctic Glacier Income Fund and its subsidiaries, including Arctic Glacier Inc., a major producer, marketer and distributor of packaged ice in North America. Arctic Glacier on Feb. 22, 2012, filed for protection under the Companies' Creditors Arrangement Act in Canada and Chapter 15 of the Bankruptcy Code in the United States. Arctic is seeking sale or investment proposals from qualified bidders. Reddy Ice's Plan provides for the restructuring of the Company's obligations with respect to $300 million of First Lien Notes; $139.4 million of Second Lien Notes; and $11.7 million of Discount Notes. If the Plan is approved, all Second Lien Notes will be exchanged and will be retired and cancelled and all Discount Notes will be cancelled. Reddy Ice said the Plan has the support of a majority of its lenders and major creditors, led by Centerbridge Capital Partners II, L.P. A hearing to approve the Disclosure Statement and confirm the Plan has been set for May 18, 2012. Judge Stacey G. Jernigan presides over the case. Reddy Ice's financial advisors are Jefferies & Company, Inc. and FTI Consulting, Inc. Kurtzman Carson Consultants serves as claims and notice agent. Centerbridge Partners is represented by Jonathan S. Zinman, Esq., Joshua A. Sussberg, Esq., James H.M. Sprayregen, Esq., and Anup Sathy, Esq., at Kirkland & Ellis. Macquarie Bank Limited is represented by Sarah Hiltz Seewer, Esq., and David R. Seligman, Esq., also at Kirkland & Ellis. The ad hoc group of First Lien and Second Lien Noteholders is represented by Joshua Andrew Feltman, Esq., at Wachtell Lipton Rosen & Katz. Wells Fargo Bank, National Association, serves as First Lien and Second Lien Agent. REFCO INC: Dist. Judge Opinion Presages Rulings in Madoff --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that U.S. District Judge Jed Rakoff in New York opined Wednesday that bankruptcy judges can't make final rulings in fraudulent transfer suits, the opposite result reached by the bankruptcy judge in the same case involving Refco Inc. According to the report, Judge Rakoff said that in a "core" matter such as a fraudulent transfer suit, he must give effect to the "clear intent" of Congress by sending the case back to the bankruptcy court for report and recommendation. Judge Rakoff's decision May 9 likely indicates how he will rule in hundreds of cases before him involving the liquidation of Bernard L. Madoff Investment Securities LLC. The report recounts that the fraudulent transfer lawsuit was filed by a trust created under the Chapter 11 plan for Refco. The defendant sought to remove the case from the bankruptcy court to the district court under Stern v. Marshall, where the U.S. Supreme Court ruled in June that bankruptcy courts lack power under the Constitution to make final rulings based on claims arising under state law. Addressing the question of his power in a decision in November in the Refco case, U.S. Bankruptcy Judge Robert Drain concluded that he retained power to make final rulings in fraudulent transfer cases even with Stern on the books. Judge Drain reasoned that even if he were to dismiss the suit, his ruling would go up on appeal under the so-called de novo standard. Thus, Drain believed, he could enter a final order on a motion to dismiss. Judge Rakoff, according to the report, said that Drain's reasoning was "flawed." Because Stern doesn't give the bankruptcy court ability to make final orders, the grant of a motion to dismiss shouldn't be given "res judicata or collateral estoppel effect," the judge said. Judge Rakoff said that fraudulent transfer suits invoke "private rights" where the final decision can only be made in a district court. The suit involved "core" disputes the bankruptcy judge had been handling for three years, Judge Rakoff said. "Having the benefit of the report and recommendation (by the bankruptcy court) will save the district court and the parties an immense amount of time," Judge Rakoff concluded. As a result, he sent the suit back to the bankruptcy judge for further processing. In view of the defendants' demand for a jury trial, Judge Rakoff said he "may withdraw the reference if and when a trial is necessary." According to Mr. Rochelle, Judge Rakoff's decision in the Refco case likely presages decisions he will issue in hundreds of lawsuits arising out of the Madoff liquidation where he is being asked to remove the case from the bankruptcy judge and decide on fraudulent transfer claims himself as a result of the Stern decision. In Madoff lawsuits, Rakoff is generally making decisions himself on what he says are issues of non-bankruptcy law. In the Madoff cases, Judge Rakoff has yet to decide the same issues he ruled on yesterday in Refco, namely, whether the cases should remain in district court or be returned to the bankruptcy court. The case in district court is Kirschner v. Agoglia, 11- 8250, U.S. District Court, Southern District of New York (Manhattan). The case in bankruptcy court is Kirschner v. Agoglia (In re Refco Inc.), 07-3060, U.S. Bankruptcy Court, Southern District of New York (Manhattan). About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) The SIPA Trustee has said that as of March 31, 2012, through prepetition litigation and other settlements, he has successfully recovered, or reached agreements to recover, more than $9 billion -- over 50% of the principal lost in the Ponzi scheme by those who filed claims -- for the benefit of all customers of BLMIS. The liquidation has so far has cost the Securities Investor Protection Corp. $1.3 billion, including $791 million to pay a portion of customers' claims. Mr. Picard has so far made only one distribution in October of $325 million for 1,232 customer accounts. Uncertainty created by the appeals has limited Mr. Picard's ability to distribute recovered funds. Outstanding appeals include the $5 billion Picower settlement and the $1.025 billion settlement. About Refco Inc. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- was a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries were members of principal U.S. and international exchanges, and were among the most active members of futures exchanges in Chicago, New York, London and Singapore. Refco was also a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco was one of the largest global clearing firms for derivatives. The Company had operations in Bermuda. The Company and 23 of its affiliates filed for Chapter 11 protection on October 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represented the Debtors in their restructuring efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its Chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on December 15, 2006. That Plan became effective on Dec. 26, 2006. Pursuant to the plan, RJM, LLC, was named plan administrator to reorganized Refco, Inc., and its affiliates, and Marc S. Kirschner as plan administrator to Refco Capital Markets, Ltd. REFLECT SCIENTIFIC: Incurs $259,000 Net Loss in First Quarter ------------------------------------------------------------- Reflect Scientific, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $259,293 on $325,017 of revenue for the three months ended March 31, 2012, compared with a net loss of $192,232 on $587,582 of revenue for the same period during the prior year. The Company reported a net loss of $1.18 million in 2011, compared with a net loss of $1.77 million in 2010. The Company's balance sheet at March 31, 2012, showed $3.97 million in total assets, $4.59 million in total liabilities and a $616,976 total shareholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/bzLDRw About Reflect Scientific Orem, Utah-based Reflect Scientific, Inc., is engaged in the manufacture and distribution of innovative products targeted at the life science market. Customers include hospitals and diagnostic laboratories, pharmaceutical and biotech companies, universities, government and private sector research facilities, and chemical and industrial companies. After auditing the 2011 results, Mantyla McReynolds, LLC, in Salt Lake City, Utah, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has experienced recurring losses from operations and negative working capital. REGAL ENTERTAINMENT: Three Directors Elected at Annual Meeting -------------------------------------------------------------- Regal Entertainment Group held its annual meeting of stockholders on May 9, 2012. The stockholders elected all three director nominees at the Meeting to serve as Class I directors until the Annual Meeting of Stockholders in 2015, namely: (a) Charles E. Brymer, (b) Michael L. Campbell and (c) Alex Yemenidjian. The stockholders approved the compensation of the Company's Named Executive Officers and ratified the selection of KPMG LLP as the Company's Independent Registered Public Accounting firm for the fiscal year ending Dec. 27, 2012. The stockholders also approved the amendments to the Incentive Plan to increase the number of Class A common stock authorized for issuance by a total of 5,000,000 shares and extend the term to May 9, 2022. 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 March 29, 2012, showed $2.30 billion in total assets, $2.85 billion in total liabilities, and a $552.60 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. REGAL ENTERTAINMENT: Registers Add'l 5MM Shares Under 2002 Plan --------------------------------------------------------------- Regal Entertainment Group filed with the U.S. Securities and Exchange Commission a Form S-8 registering 5 million shares of Class A common stock issuable under the Company's 2002 Stock Incentive Plan. On May 10, 2002, Regal Entertainment filed with the SEC a registration statement on Form S-8 covering the registration of 11,194,354 shares of its Class A common stock authorized for issuance under the Regal Entertainment Group 2002 Stock Incentive Plan as then in effect. Pursuant to the 2002 Plan and Rule 416 of the Securities Act, the number of shares of Class A common stock covered by the Original Registration Statement increased from 11,194,354 to 16,110,241 shares due to anti-dilution adjustments made in connection with the Company's payment of extraordinary cash dividends on July 1, 2003 and June 2, 2004. On Aug. 8, 2005, the Company filed with the Commission under the Securities Act a registration statement on Form S-8 covering the registration of an additional 1,889,759 shares of its Class A common stock authorized for issuance under an amendment to the 2002 Plan, bringing the total authorized shares from 16,110,241 to 18,000,000. Pursuant to the 2002 Plan and Rule 416 of the Securities Act, the number of Class A common stock covered by the 2005 Registration Statement increased from 18,000,000 to 18,319,207 shares due to anti-dilution adjustments made in connection with the Company's payment of extraordinary cash dividends on April 13, 2007 and Dec. 30, 2010. On March 13, 2012, the Company's Board of Directors approved amendments to the 2002 Plan. The amendments increase the number of shares of Class A common stock available for issuance thereunder by a total of 5,000,000 shares from 18,319,207 to 23,319,207, subject to adjustment, and extend the term of the Plan from May 3, 2012 to May 9, 2022. On May 9, 2012, the stockholders of the Company approved the amendments. A copy of the Form S-8 is available for free at: http://is.gd/pfTQyM 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 March 29, 2012, showed $2.30 billion in total assets, $2.85 billion in total liabilities, and a $552.60 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. RESIDENTIAL CAPITAL: Files for Chapter 11 in New York ----------------------------------------------------- Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. ResCap filed a number of first day motions intended to allow it to operate in the ordinary course of business during the process. First day motions filed include requests to (i) extend the deadline to file schedules and statements, (ii) hire advisors and counsel, (iii) pay prepetition obligations to employees and customers, (iv) obtain DIP financing, and (v) sell the assets in the event the plan is not confirmed. An emergency first day hearing before June Martin Glenn was held May 14, 2012. A continued first day hearing is scheduled for May 15 at 11:00 a.m. The Chapter 11 process is designed to: * permit ResCap to continue as a going concern during the reorganization process, and continue to provide uninterrupted, high quality service to its mortgage customers and business partners; * permit ResCap to continue to originate new mortgage loans, service its more than 2.4 million consumer mortgage loans, and offer loan modifications that allow homeowners to stay in their homes; * permit the ResCap business, post-reorganization and under new ownership, to continue to play an important role in preserving home ownership, providing necessary financing for home ownership, and contributing to bringing increasing stability to the U.S. mortgage markets; * provide ResCap with the opportunity to maximize value for its stakeholders; * permit ResCap to address legacy litigation and other liabilities in a manner that is fair to creditors; and * preserve the existing jobs of ResCap's employees, and contribute to the creation of additional jobs in the United States in the mortgage sector when ResCap's business operations emerge from the reorganization process under new ownership. The Chapter 11 filings are intended to facilitate ResCap's sale of substantially all of its assets. It has agreed to sell: (1) its mortgage origination and servicing businesses to Nationstar Mortgage LLC, and (2) its legacy portfolio, consisting mainly of mortgage loans and other residual financial assets, to Ally Financial. Together, the asset sales are expected to generate approximately $4 billion in proceeds. Sale to Nationstar and Ally The Debtors began soliciting offers for the assets prepetition. According to the Debtors, Ally's offer was $200 million higher than the next highest bid for the legacy portfolio. Nationstar's offer was the highest bid for the largest portion of the Debtors' assets and operations. Majority of Nationstar is owned by investment funds managed by affiliates of Fortress Investment Group, LLC. The Debtors are seeking approval to consummate the sales of certain assets under a Plan. In the unlikely event, however, that the Debtors do not obtain confirmation of the Plan, a sale motion allows the Debtors to pursue an alternative course of action and immediately move forward with the Sales under Section 363(b) of the Bankruptcy Code. The Debtors have filed the sale motion, seeking to commence two sale transactions where Nationstar would be the stalking horse bidder for the mortgage business and Ally opening the auction for the legacy portfolio. The Debtors propose a Sept. 14, 2012 deadline for initial bids, a Sept. 25 auction, and a sale hearing in October. The auction will be conducted as a close auction, open only to qualified bidders, due to the sensitive nature of the assets being sold. The purchased assets under the Nationstar Asset Purchase Agreement also include mortgage servicing rights and servicer advances belonging to Ginnie Mae. A qualified bidder can elect to bid on the Ginnie Mae MSRs independently or as part of their bid for all of the Nationstar Purchased Assets. The price for the Nationstar Purchased Assets is $2.3 billion, of which approximately $200 million relates to the Ginnie Mae MSRs. AFI is the proposed stalking horse bidder for the sale of the Debtors' legacy portfolio, which consists mainly of mortgage loans and other residual financial assets. In consideration for the sale of the Purchased Assets under the AFI APA to BMMZ, sellers will receive $1.6 billion if the sale is consummated pursuant to a Chapter 11 plan of the Debtors, subject to adjustment. If the sale is consummated pursuant to a section 363 sale outside of a Chapter 11 plan, the sellers will receive $1.4 billion, subject to adjustment. This dual APA structure allows for certain combinations of sale transactions, ensuring that the Debtors will receive the highest or best value for the assets. A qualified bidder may bid on the Nationstar Purchased Assets and/or the AFI Purchased Assets. Alternatively, a qualified bidder may bid solely on the Ginnie Mae MSRs, or the Ginnie Mae MSRs and the AFI purchased assets. Because of the significant funding needed to maintain the servicing business, the Debtors' very limited access to capital, and the ongoing concerns of various federal and state regulatory authorities, the Debtors believe that it is imperative to move forward with the sale process quickly. In addition, approval is critical to compliance with the Debtors' postpetition financing arrangements. The Debtors say while Ally Financial is an insider, extensive measures have been taken to ensure the fairness of the sale process. The Debtors propose bid protections for Nationstar. If Nationstar's bid is not the Successful Bid, Nationstar will receive a break-up fee of $72 million (of which 8.44% is allocable to the Ginnie Mae MSRs), plus reimbursement of Nationstar's actual, reasonable, out-of-pocket expenses not to exceed $10 million. $1.45 Billion DIP Financing ResCap has secured a $1.45 billion debtor-in-possession financing from Barclays Bank PLC, as sole lead arranger and administrative agent on behalf of a syndicate of lenders. ResCap believes the financing will provide it with sufficient liquidity to consummate the contemplated asset sales. The Debtors seek authority to obtain postpetition financing on a secured, superpriority basis from (i) Barclays Bank PLC, as Administrative Agent on behalf of a syndicate of lenders and (ii) Ally Financial in the form of postpetition draw(s) under the AFI secured loan agreement (AFI LOC). In addition, the Debtors intend to use cash collateral (as that term is defined in 11 U.S.C. Sec. 363(a) to pay expenses of operating their business. AFI, the holders of the junior secured notes, and prepetition lender Citibank N.A. each has consented to the use of their cash collateral. The DIP Lenders have agreed to provide: (i) revolving loans in an aggregate principal amount up to $200,000,000 with an interest rate of LIBOR + 4.00% per annum and (ii) term loans in (a) an aggregate principal amount up to $1,050,000,000 with an interest rate of LIBOR + 4.00%, and (b) an aggregate principal amount up to $200,000,000 with an interest rate of LIBOR + 6.00%, each with a LIBOR floor of 1.25% per annum. Under the AFI deal, the Debtors are permitted to make postpetition draw(s) under the AFI LOC in an amount up to $150,000,000 (which amount may be increased to $220,000,000 subject to agreement between the Debtors and AFI), with an interest rate of LIBOR + 4.00% per annum (with a LIBOR floor of 1.25% per annum). Road to Bankruptcy From time to time since 2009, ResCap or AFI has considered a sale of the Debtors' operations as an entirety or in significant parts, whether through a sale of assets or a sale of ResCap's equity, but the consideration offered was insufficient, particularly in light of potential buyers' unwillingness to assume most of the Debtors' liabilities. ResCap blames most of its woes to the continuing adverse economic climate, particularly in the residential mortgage industry. James Whitlinger, CFO of ResCap, explains that starting in 2007, the mortgage and capital markets experienced severe stress due to credit concerns and housing market contractions, which have led to record declines in home values and a continuing glut of homes available for sale and those in foreclosure. The Debtors had net losses of $5.6 billion and $4.5 billion in the years ended Dec. 31, 2008 and 2009, respectively. Adverse market conditions also resulted in a significant decline in the fair value of the Debtors' assets, particularly the MSRs and other mortgage loan assets. Without capital contributions from AFI, the Debtors would have breached their Consolidated Tangible Net Worth covenant on a number of occasions The Debtors believed that 2010 would mark a turnaround for themselves and the economy. In order to continue originating mortgage loans in the only available liquid markets and maintain their origination and servicing platforms, the Debtors entered into settlement agreements with Fannie Mae and Freddie Mac with respect to a substantial portion of their representation and warranty claims. Despite aggregate settlement payments of $786.5 million (in respect of underlying mortgage loans with aggregate UPB of $377.3 billion), the Debtors still achieved net income of $575.1 million in 2010. The Debtors, together with AFI, began taking numerous steps to survive and continue to offer affordable mortgage loans to homeowners and mortgage servicing to public and private investors. Those steps have included debt restructurings, asset sales, downsizings and capital contributions from AFI. Beginning in 2010, however, the Debtors began to contend with additional matters. Non-GSE and Ginnie Mae representation and warranty claims continued to increase. In the latter half of 2010, the "robo-signing" allegations relating to foreclosure documentation began to affect the entire mortgage loan industry. Starting in October 2010, representatives of federal and state governments, including the United States Department of Justice, began investigating the procedures followed by mortgage servicing companies and banks, including ResCap and GMAC Mortgage, in connection with mortgage foreclosure home sales and evictions. There were also a number of separate state law investigations and enforcement actions. In 2011, ResCap had a consolidated net loss of $845.1 million primarily due to continuing economic uncertainty, interest rate volatility and the adverse effects on the valuation of MSRs arising from market speculation regarding potential government? required mortgage loan refinancing programs. In addition, the Debtors continued to lack liquidity and capital and the market began to perceive that AFI's support for the Debtors was weakening, thus increasing the Debtors' hedging costs and putting severe constraints on Ally Bank's ability and desire to create and maintain MSRs in amounts consistent with historical levels. On April 13, 2011, as a result of an examination conducted by the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Company, ResCap and GMAC Mortgage -- together with AFI and Ally Bank -- entered into a consent order with the FRB and the FDIC. The consent order required ResCap and GMAC Mortgage to make improvements to various aspects of their residential mortgage loan servicing business and undertake a risk assessment of their mortgage servicing operations. The order also requires the Debtors to conduct a review of certain past residential mortgage foreclosure actions, which review is expected to cost $180 million. On Feb. 9, 2012, AFI, ResCap, and certain other of the Debtors, along with the four largest servicers of mortgage loans in the United States, reached an agreement in principle with the federal government, 49 state attorneys general, and 48 state banking departments with respect to the DOJ/AG Investigation. Pursuant to the DOJ/AG Settlement, in February 2012, ResCap paid approximately $110.0 million to a trustee, who is to distribute all such settlement funds to federal and state governments. In addition, AFI, ResCap and the other Debtors committed to provide a minimum of $200 million towards borrower relief. AFI and ResCap also agreed with the Federal Reserve System on a civil money penalty of $207 million related to the same activities that were the subject of the DOJ/AG Settlement. While ResCap had $110.4 million of consolidated net income for the three months ended March 31, 2012, there is no assurance that the Debtors will be able to generate net income for the entirety of 2012. According to Mr. Whitlinger, the Debtors, with the support of AFI, have already taken numerous steps to survive and continue to offer mortgage loans to homeowners and mortgage servicing to public and private investors. Those steps have included debt restructurings, asset sales, downsizings and capital contributions from AFI. Those steps are no longer sufficient, and the Debtors now find that they must file for relief under Chapter 11. Restructuring Plan As part of Ally Financial's support for the Chapter 11 cases and the restructuring plan, Ally Financial and ResCap have reached a global settlement of potential claims each entity and its affiliates had against the other, which settlement will provide ResCap with substantial value. In the unlikely event that ResCap does not obtain confirmation of its proposed reorganization plan, ResCap will still seek to close the sales to Nationstar and Ally Financial. In addition, ResCap has obtained support for a restructuring plan premised upon the sales from holders of ResCap's junior secured notes holding a significant amount of the outstanding notes. Also, ResCap has obtained support from, and entered into a settlement agreement with, institutional investors in residential mortgage-backed securities issued by ResCap's affiliates. At present, institutional investors holding more than 25% of at least one class in each of 290 securitizations have agreed to support the reorganization. These 290 securitizations have an aggregate original principal balance of approximately $165 billion. As a total of 392 securitizations, with an aggregate original principal balance of approximately $221 billion, remain outstanding, it is clear that the ResCap reorganization has broad support among institutional investors. The settlements are subject to Bankruptcy Court approval. Given the support of Ally Financial, the debtholders, and other constituencies, ResCap is hopeful that its restructuring plan will be approved by the fourth quarter of 2012. Milestones agreed to by the parties under the Plan Support Agreement are: * The Debtors will obtain interim approval of the DIP financing facilities on or before May 18, 2012, * The Debtors will file the Chapter 11 plan and disclosure statement on or before June 15, 2012. * The Debtors will obtain final approval of the DIP financing facilities on or before 50 days following the Petition Date. * On or before 90 days following the Petition Date, the bankruptcy court will have entered an order approving the Disclosure Statement. * On or before Oct. 31, 2012, the Bankruptcy Court will have entered an order confirming the Plan. * On or before Dec. 15, 2012, the effective date of the Plan will have occurred. Advisors & Attorneys Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq. -- ray.schrock@kirkland.com -- at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. Ally Repayment to Treasury "The action by ResCap will enable Ally to achieve a permanent solution to its legacy mortgage risks and put these issues behind us," said Ally Chief Executive Officer Michael A. Carpenter. "This action, along with pursuing alternatives for the international businesses, will allow Ally to focus 100 percent of its energies on further strengthening its already leading U.S. auto finance and direct banking franchises." Ally has paid approximately $5.5 billion to the U.S. Treasury, which has enabled the taxpayer to recover about one-third of the investment made in the company. Upon successful completion of the announced strategic initiatives, Ally expects to have returned a total of two-thirds of the taxpayer's investment. Ally has agreed to take certain steps to support the stability of ResCap and its leading mortgage servicing platform during the Chapter 11 cases. Those steps include: * making a cash contribution of $750 million to the ResCap Chapter 11 estate upon confirmation of the plan; * making a stalking horse bid for up to $1.6 billion of ResCap-owned mortgages currently marked at 45% of UPB; * providing ResCap a $150 million debtor in possession financing facility; * supporting ResCap's consumer lending originations during the process; and * other arrangements to support ResCap's Chapter 11 plan. Ally is expected to record an associated charge of $1.3 billion in the second quarter of 2012. The estimated charge is primarily driven by a write-down to zero of Ally's $400 million equity investment in ResCap, the $750 million cash contribution and $130 million related to the establishment of a mortgage repurchase reserve at Ally Bank that replaces a reserve previously held at ResCap. Absent the determination by the ResCap board of directors to file for Chapter 11, ResCap would have required billions of dollars of support from its parent to meet its obligations, which would have substantially delayed Ally's plans to repay the remaining capital investment to the U.S. Treasury. About ResCap Residential Capital and its affiliates are a leading residential real estate finance company indirectly owned by Ally Financial Inc., which is not a Debtor. The Debtors and their non-debtor affiliates operate the fifth largest servicing business and the tenth largest mortgage origination business in the United States. ResCap is the mortgage subsidiary of non-debtor Ally Financial. Ally Financial, formerly GMAC Inc. -- http://www.ally.com/-- is one of the world's largest automotive financial services companies. The company offers a full suite of automotive financing products and services in key markets around the world. Ally's other business units include mortgage operations and commercial finance, and the company's subsidiary, Ally Bank, offers online retail banking products. Ally operates as a bank- holding company. GMAC obtained a $17 billion bailout from the U.S. government in exchange for a 56.3% stake. Private equity firm Cerberus Capital Management LP keeps 14.9%, while General Motors Co. owns 6.7%. Ally reported a net loss of $157 million in 2011, compared with net income of $1.07 billion in 2010. Net income was $310 million for the three months ended March 31, 2012. Ally's balance sheet at March 31, 2012, showed $186.35 billion in total assets, $166.68 billion in total liabilities and $19.66 billion in total equity. RESIDENTIAL CAPITAL: Case Summary & 50 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Residential Capital, LLC 1177 Avenue of the Americas New York, NY 10036 Bankruptcy Case No.: 12-12020 Debtor-affiliates that filed separate Chapter 11 petitions: Debtor Case No. ------ -------- ditech, LLC 12-12021 DOA Holding Properties, LLC 12-12022 DOA Properties IX (Lots-Other), LLC 12-12023 EPRE LLC 12-12024 Equity Investment I, LLC 12-12025 ETS of Virginia, Inc. 12-12026 ETS of Washington, Inc. 12-12027 Executive Trustee Services, LLC 12-12028 GMAC Model Home Finance I, LLC 12-12030 GMAC Mortgage USA Corporation 12-12031 GMAC Mortgage, LLC 12-12032 GMAC Residential Holding Company, LLC 12-12033 GMAC RH Settlement Services, LLC 12-12034 GMACM Borrower LLC 12-12035 GMACM REO LLC 12-12036 GMACR Mortgage Products, LLC 12-12037 GMAC-RFC Holding Company, LLC 12-12029 HFN REO Sub II, LLC 12-12038 Home Connects Lending Services, LLC 12-12039 Homecomings Financial Real Estate Holdings, LLC 12-12040 Homecomings Financial, LLC 12-12042 Ladue Associates, Inc. 12-12043 Passive Asset Transactions, LLC 12-12044 PATI A, LLC 12-12045 PATI B, LLC 12-12046 PATI Real Estate Holdings, LLC 12-12047 RAHI A, LLC 12-12048 RAHI B, LLC 12-12049 RAHI Real Estate Holdings, LLC 12-12050 RCSFJV2004, LLC 12-12051 Residential Accredit Loans, Inc. 12-12052 Residential Asset Mortgage Products, Inc. 12-12053 Residential Asset Securities Corporation 12-12054 Residential Capital, LLC 12-12020 Residential Consumer Services of Ohio, LLC 12-12056 Residential Consumer Services of Texas, LLC 12-12057 Residential Consumer Services, LLC 12-12058 Residential Funding Company, LLC 12-12019 Residential Funding Mortgage Exchange, LLC 12-12059 Residential Funding Mortgage Securities I, Inc. 12-12060 Residential Funding Mortgage Securities II, Inc. 12-12061 Residential Funding Real Estate Holdings, LLC 12-12062 Residential Mortgage Real Estate Holdings, LLC 12-12063 Residential Services of Alabama, LLC 12-12055 RFC Asset Holdings II, LLC 12-12065 RFC Asset Management, LLC 12-12066 RFC Borrower LLC 12-12069 RFC Construction Funding, LLC 12-12069 RFC REO LLC 12-12070 RFC SFJV-2002, LLC 12-12071 RFC-GSAP Servicer Advance, LLC 12-12064 Type of Business: Residential Capital, LLC is one of the largest originators, sellers and servicers of residential mortgage loans in the U.S. ResCap is a wholly owned subsidiary of Ally Financial Inc. ResCap conducts certain of its mortgage operations through GMAC Mortgage, a wholly owned subsidiary that is not affiliated with General Motors. ResCap is an approved Fannie Mae and Freddie Mac servicer and approved issuer for Ginnie Mae. Chapter 11 Petition Date: May 14, 2012 Court: U.S. Bankruptcy Court Southern District of New York Judge: Hon. Martin Glenn Debtors' Counsel: Larren M. Nashelsky, Esq. Gary S. Lee, Esq. Lorenzo Marinuzzi, Esq. MORRISON & FOERSTER LLP 1290 Avenue of the Americas New York, NY 10104 Tel: (212) 468-8000 Fax: (212) 468-7900 E-mail: lnashelsky@mofo.com glee@mofo.com lmarinuzzi@mofo.com Debtors' Financial Advisor: FTI CONSULTING INC. Debtors' Investment Banker: CENTERVIEW PARTNERS LLC Samuel M. Greene Marc Puntus 31 West 52nd Street 52nd street, 22nd Floor, New York, New York 10019 E-mail: sgreene@centerviewpartners.com mpuntus@centerviewpartners.com Debtors' Conflicts Counsel: CURTIS, MALLET-PREVOST, COLT & MOSLE LLP Debtors' Public Relations Consultants: RUBENSTEIN ASSOCIATES, INC. Debtors' Claims and Noticing Agent: KURTZMAN CARSON CONSULTANTS LLP 2335 Alaska Ave El Segundo, CA 90245 Tel: (888) 251-2914 Total Assets: $15,675,571,000 as of March 31, 2012 Total Debts: $15,276,228,000 as of March 31, 2012 The petition was signed by James Whitlinger, chief financial officer. Consolidated List of 50 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Deutsche Bank Trust Company 8.500% Senior $473,416,000 Americas Unsecured Notes C/O Kelvin Vargas due April 2013 25 De Forest Ave Summit, NJ 07901 Phone: (201) 593-2456 E-mail: kelvin.vargas@db.com Deutsche Bank Trust Company 750,000,000 Euros $127,671,000 Americas Aggregate C/O Kelvin Vargas Principal Amount 25 De Forest Ave of 7.125% Summit, NJ 07901 Notes due May 2012 Phone: (201) 593-2456 E-mail: kelvin.vargas@db.com Deutsche Bank Trust Company 8.875% Senior $112,227,000 Americas Unsecured Notes C/O Kelvin Vargas due June 2015 25 De Forest Ave Summit, NJ 07901 Phone: (201) 593-2456 E-mail: kelvin.vargas@db.com Deutsche Bank Trust Company GBP400,000,000 $103,743,000 Americas Aggregate C/O Kelvin Vargas Principal Amount 25 De Forest Ave of 9.875% Summit, NJ 07901 Notes due July 2014 Phone: (201) 593-2456 E-mail: kelvin.vargas@db.com Deutsche Bank Trust Company 8.500% Senior $79,879,000 Americas Unsecured Notes C/O Kelvin Vargas due June 2012 25 De Forest Ave Summit, NJ 07901 Phone: (201) 593-2456 E-mail: kelvin.vargas@db.com Deutsche Bank Trust Company GBP400,000,000 $59,379,200 Americas Aggregate C/O Kelvin Vargas Principal Amount 25 De Forest Ave of 8.375% Summit, NJ 07901 Notes due May 2013 Phone: (201) 593-2456 E-mail: kelvin.vargas@db.com BNY Mellon Contingent Claim- Unknown C/O Dechert LLP Securitization 1095 Avenue of the Americas New York, NY 10036 Phone: (212) 698-3621 Fax: (212) 698-3599 E-mail: hector.gonzalez@dechert.com US Bank Contingent Claim- Unknown C/O Seward & Kissel LLP Securitization One Battery Park Plaza New York, NY 10004 Phone: (212) 574-1391 Fax: (212) 480-8421 E-mail: das@sewkis.com Deutsche Bank AG, New York Contingent Claim- Unknown C/O Joe Salama Securitization 60 Wall Street New York, NY 10005-2836 Phone: (212) 250-9536 Fax: (866) 785-1127 E-mail: joe.salama@db.com Federal Housing Finance Agency Contingent Claim- Unknown C/O Alfred Pollard Securitization 400 Seventh Street, SW Phone: (202) 649-3804 E-mail: GeneralCounsel@FHFA.org MBIA, Inc. Contingent Claim- Unknown C/O Cadwalader, Wickersham Litigation & Taft One World Financial Center New York, NY 10281 Phone ) 504-6373 Fax: (212) 504-6666 E-mail: gregory.petrick@cwt.com Ambac Assurance Corp Contingent Claim- Unknown C/O Patterson Belknap Webb & Litigation Tyler 1133 Avenue of the Americas New York, NY 10036 Phone: (212) 336-2140 Fax: (212) 336-2094 E-mail: prforlenza@pbwt.com Financial Guaranty Insurance Co. Contingent Claim- Unknown C/O Jones Day Litigation 222 East 41st Street New York, NY 10017-6702 Phone: (212) 326-7844 Fax: (212) 755-7306 E-mail: cball@jonesday.com Assured Guaranty Corp. Contingent Claim- Unknown C/O Margaret Yanney Litigation 31 West 52nd Street New York, NY 10019 Phone: (212) 857-0581 Fax: (212) 893-2792 E-mail: myanney@assuredguaranty.com Thrivent Financial for Lutherans Contingent Claim- Unknown C/O Teresa J. Rasmussen Securities 625 Fourth Avenue S. Minneapolis, MN 55415-1624 Phone: (800) 847-4836 West Virginia Investment Contingent Claim- Unknown Management Board Securities C/O Craig Slaughter 500 Virginia Street East, Suite 200 Phone: (304) 345-2672 Allstate Insurance Contingent Claim- Unknown C/O Quinn Emanuel Urquhart Securities & Sullivan 865 S. Figueroa Street, 10th Floor Phone: (213) 443-3000 E-mail: danbrockett@quinnemanuel.com Western & Southern Contingent Claim- Unknown C/O Wollmuth Maher & Deutsch Securities LLP 500 Fifth Avenue New York, NY 10110 Phone: (212) 382-3300 E-mail: dwollmuth@wmd-law.com The Union Central Life Contingent Claim- Unknown Insurance Company Securities C/O Robbins Geller Rudman & Dowd LLP 655 West Broadway, Suite 1900 Phone: (619) 231-1058 Fax: (519) 231-7423 E-mail: stevep@rgrdlaw.com Cambridge Place Investment Contingent Claim- Unknown Management Inc. Securities C/O Donnelly, Conroy & Gelhaar LLP 1 Beacon Street, 33rd Floor Phone: (617) 720-2880 Fax: (617) 720-3553 E-mail: msd@dcglaw.com Sealink Funding Limited Contingent Claim- Unknown C/O Labaton Sucharow LLP Securities 140 Broadway Phone: (212) 907-0869 Fax: (212) 883-7069 E-mail: jbernstein@labaton.com Stichting Pensioenfonds ABP Contingent Claim- Unknown C/O Grant & Eisenhofer Securities 123 S. Justison Street Phone: (302) 622-7040 Fax: (302) 622-7100 E-mail: gjarvis@gelaw.com Huntington Bancshares Inc. Contingent Claim- Unknown C/O Grant & Eisenhofer Securities 123 S. Justison Street Phone: (302) 622-7040 Fax: (302) 622-7100 E-mail: gjarvis@gelaw.com Federal Home Loan Bank of Contingent Claim- Unknown Chicago Securities C/O Keller Rohrback LLP 1201 Third Avenue, Suite 3200 Phone: (206) 623-1900 Fax: (206) 623-3384 E-mail: dloeser@kellerrohrback.com Federal Home Loan Bank of Contingent Claim- Unknown Boston Securities C/O Keller Rohrback LLP 1201 Third Avenue, Suite 3200 Phone: (206) 623-1900 Fax: (206) 623-3384 E-mail: dloeser@kellerrohrback.com Federal Home Loan Bank of Contingent Claim- Unknown Indianapolis Securities C/O Keller Rohrback LLP 1201 Third Avenue, Suite 3200 Phone: (206) 623-1900 Fax: (206) 623-3384 E-mail: dloeser@kellerrohrback.com Massachusetts Mutual Life Contingent Claim- Unknown Insurance Company Securities C/O Bernadette Harrigan 1295 State Street Phone: (413) 788-8411 Fax: (413) 226-4268 National Credit Union Contingent Claim- Unknown Administration Board Securities C/O Susman Godfrey LLP 1901 Avenue of the Stars, Suite 950 Phone: (310) 789-3100 Fax: (310) 789-3150 E-mail: mseltzer@susmangodfrey.com The Charles Schwab Corporation Contingent Claim- Unknown C/O Grais & Ellsworth LLP Securities 70 East 55th Street New York, NY 10022 Phone: (212) 755-0100 Fax: (212) 755-0052 New Jersey Carpenters Health Contingent Claim- Unknown Fund Securities C/O Cohen Milstein Sellers & Toll PLLC 150 East 52nd Street, Thirtieth Floor New York, NY 10022 Phone: (212) 838-7797 Fax: (212) 838-7745 E-mail: jlaitman@cohenmilstein.com New Jersey Carpenters Vacation Contingent Claim- Unknown Fund Securities C/O Cohen Milstein Sellers & Toll PLLC 150 East 52nd Street, Thirtieth Floor New York, NY 10022 Phone: (212) 838-7797 Fax: (212) 838-7745 E-mail: jlaitman@cohenmilstein.com Boilermaker Blacksmith National Contingent Claim- Unknown Pension Trust Securities C/O Cohen Milstein Sellers & Toll PLLC 150 East 52nd Street, Thirtieth Floor New York, NY 10022 Phone: (212) 838-7797 Fax: (212) 838-7745 E-mail: jlaitman@cohenmilstein.com Police and Fire Retirement Contingent Claim- Unknown System of the City of Detroit Securities C/O Zwerling, Schachter & Zwerling 41 Madison Avenue New York, NY 10010 Phone: (212) 223-3900 Fax: (212) 371-5969 E-mail: rzwerling@zsz.com Orange County Employees Contingent Claim- Unknown Retirement System Securities C/O Cohen Milstein Sellers & Toll PLLC 150 East 52nd Street, Thirtieth Floor New York, NY 10022 Phone: (212) 838-7797 Fax: (212) 838-7745 E-mail: jlaitman@cohenmilstein.com Midwest Operating Engineers Contingent Claim- Unknown Pension Trust Fund Securities C/O Cohen Milstein Sellers & Toll PLLC 150 East 52nd Street, Thirtieth Floor New York, NY 10022 Phone: (212) 838-7797 Fax: (212) 838-7745 E-mail: jlaitman@cohenmilstein.com Iowa Public Employees Retirement Contingent Claim- Unknown System Securities C/O Cohen Milstein Sellers & Toll PLLC 150 East 52nd Street, Thirtieth Floor New York, NY 10022 Phone: (212) 838-7797 Fax: (212) 838-7745 E-mail: jlaitman@cohenmilstein.com Brian Kessler, et al Contingent Unknown C/O Walters Bender Strohbehn Litigation & Vaughan, P.C. 2500 City Center Square, 1100 Main, Suite 2500 Donna Moore Contingent Unknown C/O Kessler Topaz Meltzer Litigation & Check, LLP 280 King of Prussia Road Radnor, PA 19087 Phone: (610) 822.0242 Fax: (610) 667.7056 E-mail: eciolko@ktmc.com Steven And Ruth Mitchell Settled $14,500,000 C/O Walters Bender Stroehbehn Litigation & Vaughan, P.C 2500 City Center Square, 1100 Main Street Kansas City, MO 64105 Phone: (816) 421-6620 Fax: (816) 421-4747 E-mail: awalter@wbsvlaw.com Indecomm Global Services General $675,000 200 Middlesex Essex Turnpike Trade Suite 102 Payable Iselin, NJ 08830 Phone: (732) 404-0081 Ext. 208 E-mail: Rajan@indecomm.net Alan Gardner Settled $555,000 C/O Williamson & Williams Litigation 187 Parfitt Way SW, Suite 250 Bainbridge Island, WA 98110 Phone: (206) 441-5444 Fax: (206) 780-5557 E-mail: roblin@williamslaw.com Tiffany Smith Settled $275,000 C/O Schroeter Goldmark & Bender Litigation 500 Central Bldg., 810 Third Ave. Seattle, WA 98104 Phone: (206) 622-8000 Fax: (206) 682-2305 E-mail: info@sgb-law.com Don E. Diane M. Patterson Settled $157,950 Litigation Wells Fargo & Company General $121,000 Trade Payable Credstar General $99,773 Trade Payable Emortgage Logic General $87,910 Trade Payable Aegis Usa Inc. General $72,116 Trade Payable ISGN Fulfillment Services Inc General $65,754 Trade Payable US Bank General $64,000 Trade Payable Deborah Pangel and Lee Sachs Settled $55,000 Litigation ROYAL MANOR: 6th Cir. Affirms Order Denying Gordons' Claims ----------------------------------------------------------- The U.S. Court of Appeals for the Sixth Circuit affirmed a series of bankruptcy court orders denying claims by two would-be creditors, Alison and David Gordon. At the heart of the case is an agreement concerning a $1 million transaction that Gertrude Gordon undertook on behalf of her children, Alison and David Gordon. Gertrude loaned $1 million to her sister and brother-in-law, Sally and Abraham Schwartz, who were the majority owners of Dani and Darlington, two interrelated companies that together owned and operated a nursing home. An agreement memorialized the transaction. The first line of the agreement said "Sally and Abraham Schwartz to Gertrude, David, Alison Gordon." It provided terms for repayment, including that the principal investment would be repaid by July 2002. Sally and Abraham Schwartz signed the agreement. The Gordons never received any payments and did not challenge the default until 2008. No one signed the agreement on behalf of Dani or Darlington. In 2008, Dani and Darlington filed for Chapter 11 bankruptcy. Alison and David filed a claim for more than $2 million (principal plus interest) against the bankruptcy estate, invoking the agreement. During discovery, the Gordons learned of new documents related to the $1 million transaction. They moved to file a new claim based on the new information, but the bankruptcy court denied the motion. The court held a bench trial on the Gordons' original claim and denied it, too. The Gordons appealed three orders of the bankruptcy court: (1) the order denying their original claim, (2) the order denying their motion to file a new claim, and (3) an order striking the trustee's exhibit list from the record. The district court affirmed all three orders. The Gordons contend that the July 2000 agreement establishes an unsecured claim against the Dani/Darlington bankruptcy estate. The bankruptcy and district courts disagreed, holding that the agreement created a personal obligation of the Schwartzes, not an obligation of Dani or Darlington. That is correct, the Sixth Circuit said. The appeal is ALISON GORDON and DAVID GORDON, Appellants, v. OFFICIAL COMMITTEE OF UNSECURED CREDITORS, Appellee, Nos. 09-4432, 10-4321, 10-4322 (6th Cir.). A copy of the Sixth Circuit's May 8, 2012 decision is available at http://is.gd/xRx0Kifrom Leagle.com. Royal Manor Management, Inc., headquartered in Brunswick, Ohio, filed for Chapter 11 bankruptcy (Bankr. N.D. Ohio Case No. 08-50421) on Feb. 12, 2008. Judge Marilyn Shea-Stonum presides over the case. Mark Schlachet, Esq., serves as Royal Manor's bankruptcy counsel. It disclosed $7,357 in assets and $15,066,772 in liabilities. SAN ANTONIO OPERA: Files in Chapter 7 to Liquidate -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports the San Antonio Opera didn't attempt to reorganize, instead filed a liquidating Chapter 7 petition (Bankr. W.D. Tex. Case No. 12-51490) on May 8 in San Antonio. The opera disclosed assets of only $1,500 against debt totaling $894,000. SOLAR TRUST: Gets Court Approval to Auction Assets -------------------------------------------------- Lance Duroni at Bankruptcy Law360 reports that U.S. Bankruptcy Judge Kevin Gross on Friday gave Solar Trust of America LLC the go-ahead to auction its assets, which include a 1,000-megawatt solar power project under development in California that would be the largest of its kind. At a court hearing in Wilmington, Judge Gross approved bidding procedures for a June 21 auction, with bids due June 18, according to Law360. About Solar Trust Solar Trust of America LLC, Solar Millennium Inc., and nine affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-11136) on April 2, 2012. Solar Trust is a joint venture created by Solar Millennium AG and Ferrostaal AG to develop solar projects at locations in California and Nevada. Located in the "Solar Sun Belt" of the American Southwest, the project sites have extremely high solar radiation levels, and allow the Debtors' projects to harness high levels of solar power generation. Projects include the rights to develop one of the world's largest permitted solar plant facilities with capacity of 1,000 MW in Blythe, California. Two other projects contemplated 500 MW solar power facilities in Desert Center, California and Amargosa Valley, Nevada. Although the Debtors have obtained highly valuable transmission right and permits, each project is only in the developmental phase and does not generate revenue for the Debtors. Ferrostaal ceased providing funding two years ago and SMAG, due to its own deteriorating financial condition, stopped providing funding after December 2011. NextEra Energy Resources LLC has committed to provide a postpetition secured credit facility and has expressed an interest in serving as stalking horse purchaser for certain of the Debtors' assets. Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. K&L Gates LLP is the special corporate counsel. Ridgecrest Solar Power Project, LLC, and two entities filed for Chapter 11 protection (Bankr. D. Del. Case Nos. 12-11204 to 12-11206) on April 10, 2012. Ridgecrest Solar, et al., are affiliates of Solar Trust of America LLC. STA Development, LLC, one of the debtors that filed for bankruptcy April 2, 2012, owns 100% of the interests in Ridgecrest, et al. Ridgecrest Solar Power estimated up to $50,000 in assets and debts. Ridgecrest Solar I, LLC, estimated up to $50,000 in assets and up to $10 million in liabilities. SOUTH BAY LUBE: Files for Chapter 11 in Tampa --------------------------------------------- Sarasota, Florida-based South Bay Lube, Inc., filed a Chapter 11 bankruptcy petition (Bankr. M.D. Fla. Case No. 12-07356) on May 11, 2012, in Tampa. South Bay Lube operates 26 Jiffy Lube stores in Florida. The Debtor has 210 employees. The Debtor estimated assets and debts in excess of $10 million as of the Chapter 11 filing. GE Capital Commercial, Inc., asserts a secured claim of $9.2 million. The Debtor intends to use GE's cash collateral. The Debtor will seek to use cash of $250,000 per week pending final approval of the motion. The Debtor on the petition date also filed emergency motions to (i) pay prepetition wages and benefits of employees, (ii) pay salaries and honor existing agreements with officers, and (iii) maintain its existing bank accounts. A hearing on the first-day motions is scheduled for May 16, 2012 at 3:00 p.m. Judge Caryl E. Delano has been assigned to the case. According to the case docket, the Chapter 11 plan and disclosure statement are due Sept. 10, 2012. STEREOTAXIS INC: Files Form 10-Q; Incurs $5.8MM Net Loss in Q1 -------------------------------------------------------------- Stereotaxis, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $5.81 million on $12.28 million of total revenue for the three months ended March 31, 2012, compared with a net loss of $9.54 million on $10.22 million of total revenue for the same period during the prior year. The Company's balance sheet at March 31, 2012, showed $36.79 million in total assets, $60.16 million in total liabilities and a $23.36 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/6ogTt2 About Stereotaxis Based in St. Louis, Mo., Stereotaxis, Inc., designs, manufactures and markets the Epoch Solution, which is an advanced remote robotic navigation system for use in a hospital's interventional surgical suite, or "interventional lab", that the Company believes revolutionizes the treatment of arrhythmias and coronary artery disease by enabling enhanced safety, efficiency and efficacy for catheter-based, or interventional, procedures. For the year ended Dec. 31, 2011, Ernst & Young LLP, in St. Louis, Missouri, expressed substantial doubt about Stereotaxis' ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring operating losses and has a working capital deficiency. The Company reported a net loss of $32.0 million for 2011, compared with a net loss of $19.9 million for 2010. STONECREST FIN'L: Perpetual Care Trust Fund Not Estate's Asset -------------------------------------------------------------- Chief Bankruptcy Judge Douglas O. Tice, Jr., denied, without prejudice, the request of Roy M. Terry, Jr., the chapter 7 trustee of Stonecrest Financial, Inc., for an order determining the scope of administrative costs and determining whether the income and corpus of a perpetual care trust fund may be used to pay those administrative costs. The Court also denied the trustee's request to use the perpetual care trust fund to pay claims filed in the Debtor's Chapter 7 bankruptcy case. The Court held the perpetual care trust fund is not an asset of the estate and agrees with the argument of Bay Trust Company, the trustee of the perpetual care trust fund, that a separate adversary proceeding is required if the Chapter 7 trustee seeks turnover of funds. Stonecrest Financial, Inc., d/b/a Meadow-Brooke Memorial Gardens, whose principal asset was real property located in King George, Virginia, upon which a cemetery was operated, filed a voluntary chapter 11 petition (Bankr. E.D. Va. Case No. 10-36955) on Oct. 6, 2010. However, upon the motion of the United States Trustee, the case was converted to chapter 7 on Oct. 19, 2010, and Roy M. Terry, Jr., was appointed Chapter 7 trustee. Pursuant to his appointment, he sought and was granted authority to operate the Debtor's cemetery business on a limited basis for a limited time. The chapter 7 trustee incurred costs and expenses related to the administration, maintenance and operation of debtor's business. On Dec. 9, 2010, the court entered an order granting relief from the automatic stay to Ruth J. Herrink, the cemetery's former owner, to allow her to foreclose on the real property upon which the cemetery is located. Virginia law requires that all cemeteries, with certain limited exceptions, maintain a perpetual care trust fund funded by a deposit of ten percent of the funds received from the sale of graves and above-ground crypts. Such a perpetual care fund is in existence for the cemetery operated by the debtor. The chapter 7 trustee asserts that the corpus of the trust is approximately $124,000 and that the amount he proposes to distribute to pay administrative claims of the estate is approximately $50,000. Claims filed in the case, less Ms. Herrink's secured claim, total $15, 720. A copy of the Court's May 10, 2012 Memorandum Opinion and Order is available at http://is.gd/p3wx4zfrom Leagle.com. SUFFOLK REGIONAL: Files for Ch. 9 Again After Law Passed -------------------------------------------------------- Suffolk Regional Off-Track Betting Corporation filed a Chapter 9 petition (Bankr. E.D.N.Y. Case No. 12-73029) on May 11, 2012, in Central Islip, New York. Suffolk OTB is one of five separately governed off-track betting corporations in the State of New York. Headquartered in Hauppauge, Suffolk OTB operates six regular branches throughout the County of Suffolk. Suffolk OTB opened its first branch in April 1975, five years after the New York Legislature authorized the creation of the first OTB in New York City. In addition to its regular branches, Suffolk OTB has 19 Qwik Bet (machine betting) locations, a tele-theater and a telephone account wagering operation. Suffolk OTB is a public benefit corporation that offers off-track pari-mutuel wagering on thoroughbred and harness horse races held at race tracks located in the State and certain race tracks located outside of the State. As of May 1, 2012, Suffolk OTB employed in the aggregate 215 employees, of whom 159 are members of two unions. Of the union members, 137 branch cashiers and attendant custodians are represented by Local 237 of the International Brotherhood of Teamsters and 22 branch managers are represented by UFCW Local 312. On March 18, 2011, Suffolk OTB filed a voluntary petition for relief under chapter 9 (Case No. 11-42250-CEC). The case was dismissed in December 2011 following an objection by Churchill Downs Incorporated. The Debtor appealed the order although in May 2012 the parties agreed to voluntarily dismiss the appeal. While the appeal was pending, the New York Legislature amended the Racing Law to specifically authorize Suffolk OTB to be a debtor under chapter 9. Accordingly, the Suffolk OTB filed a new Chapter 9 petition to implement a debt-adjustment plan that includes attempting to resolve claims, executing cost-cutting measures and reducing expenses. Deteriorating Condition Jeffrey A. Casale, president of Suffolk OTB, explains, "The financial condition of Suffolk OTB, as well as the State's five regional OTBs, has substantially deteriorated over the last five years. This decline was caused mainly by the failing economy, competition with other gambling entities and waning interest in the horse racing industry. Moreover, the mandatory statutory distributions that the OTBs are required to make pursuant to the Racing Law have increased, thereby preventing Suffolk OTB from retaining sufficient capital to reinvest in its business. Furthermore, Suffolk OTB faces greater operating costs, particularly increases in the cost of pension plans and post- employment benefits including retiree health care. Cash flow problems are also contributing to Suffolk OTB's financial distress. Suffolk OTB has debts substantially greater than its current ability to repay and is currently not paying its debts as they come due." For years Suffolk OTB has sought amendment of the legislative distribution scheme. During its previous Chapter 9 case, Suffolk OTB sought to effect a plan that contemplated that Suffolk OTB's debts would be adjusted by an extension of time to pay prepetition claims of certain racing claimants and a distribution of cash to certain governmental claimants and holders of general unsecured claims in full satisfaction and in exchange for their claims. Unfortunately, Churchill's objection to the Chapter 9 Petition prevented Suffolk OTB from confirming the plan. Chapter 9 Case Now that the eligibility issue raised in the Churchill's objection and on appeal has been resolved by the amendment to the Racing Law, Suffolk OTB has an opportunity to readjust its debt and implement a new business plan in connection with this Chapter 9 case. Mr. Casale relates that Suffolk and Nassau OTB management has met on several occasions to explore expansion of joint ventures and shared services, including internet wagering platforms, purchasing, and legal services. While no agreements have been reached between the regions, discussions are continuing. In addition, Suffolk is exploring the potential for other joint venture opportunities with other regional OTBs and one other industry participant in the State. Discussions are ongoing with Suffolk OTB's secured creditor, New York Commercial Bank, in an effort to secure partial funding for Suffolk OTB's plans (based on equity in Suffolk OTB's real estate holdings). Suffolk OTB adds that it has also been regularly reducing operating expenses and implementing cost cost-cutting measures in an effort to improve profitability as set forth in the Gazes Declaration. Suffolk will continue to make cuts in operating expenses, restructure costs, decrease staffing, eliminate and/or modify certain benefits, reject burdensome or onerous executory contracts and leases and negotiate more favorable terms and modify other contracts and leases. Suffolk OTB says that as aggressively as it is cutting its bottom line, it is equally committed to growing its future business. That future veers away from bricks and mortar and towards Qwik Bets, internet wagering and other remote wagering mechanisms. Suffolk OTB will also drive growth by improving the Suffolk OTB experience for existing customers. In addition, Suffolk OTB will seek to generate revenue from other sources such as the installation of cell towers on owned real estate properties. Suffolk OTB says it will continue to advocate for changes to the statutory payment structure governing all OTB's revenue distributions, although it is not anticipating any immediate changes being enacted by the New York Legislature. Notwithstanding, the New York Legislature has recently amended the Racing Law and removed the restriction placed on "capital acquisition funds" such that Suffolk OTB will now be able to access these funds for operational purposes. THERMOENERGY CORP: Security Investors Holds 8.4% Equity Stake ------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Security Investors, LLC, disclosed that, as of Jan. 31, 2012, it beneficially owns 24,441,140 shares of common stock of ThermoEnergy Corporation representing 8.46% of the shares outstanding. A copy of the filing is available for free at: http://is.gd/J7ymjl About ThermoEnergy Corporation Little Rock, Ark.-based ThermoEnergy Corporation is a clean technologies company engaged in the worldwide development of advanced municipal and industrial wastewater treatment systems and carbon reducing clean energy technologies. As reported by the TCR on April 7, 2011, Kemp & Company, a Professional Association, in Little Rock, Arkansas, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred net losses since inception and will require substantial capital to continue commercialization of the Company's technologies and to fund the Companies liabilities. The Company reported a net loss of $12.87 million on $5.58 million of revenue in 2011, compared with a net loss of $9.85 million on $2.87 million of revenue in 2010. The Company's balance sheet at Dec. 31, 2011, showed $8.78 million in total assets, $13.27 million in total liabilities and a $4.49 million total stockholders' deficiency. UNIGENE LABORATORIES: Files Form 10-Q, Incurs $6MM Loss in Q1 ------------------------------------------------------------- Unigene Laboratories, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $6.01 million on $1.75 million of total revenue for the three months ended March 31, 2012, compared with a net loss of $6.64 million on $2.12 million of total revenue for the same period during the previous year. The Company's balance sheet at March 31, 2012, showed $14.07 million in total assets, $74.83 million in total liabilities and a $60.75 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/LKTT8H About Unigene Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/ -- is a biopharmaceutical company focusing on the oral and nasal delivery of large-market peptide drugs. Unigene reported a net loss of $17.92 million in 2011, a net loss of $27.86 million in 2010, and a net loss of $13.38 million in 2009. Grant Thornton LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern following the 2011 financial results. The independent auditors noted that the Company has incurred a net loss of $17,900,000 during the year ended Dec. 31, 2011, and, as of that date, has an accumulated deficit of approximately $189,000,000 and the Company's total liabilities exceeded total assets by $55,138,000. VERENIUM CORP: Reports $30.1 Million Net Income in Q1 ----------------------------------------------------- Verenium Corporation reported net income attributed to the Company of $30.12 million on $17.22 million of total revenue for the three months ended March 31, 2012, compared with net income attributed to the Company of $3.81 million on $13.39 million of total revenue for the same period a year ago. The Company's balance sheet at March 31, 2012, showed $94.12 million in total assets, $53.81 million in total liabilities and $40.31 million in stockholders' equity. "The first quarter was a turning point for Verenium. Beyond the repayment of our outstanding debt, we also initiated discussions with a wide array of companies who recognize the value of our technology, and signed agreements with both Tate & Lyle and DSM that validate our unique capabilities," said James Levine, President and Chief Executive Officer at Verenium. "We now have the flexibility to direct our full attention on growing the business with a focus on increasing sales from our current product portfolio, advancing the multiple products in our pipeline, and completing new partnerships to accelerate our entry into new end markets." A copy of the press release is available for free at: http://is.gd/KvnbNL About Verenium Corporation Cambridge, Mass.-based Verenium Corporation (NASDAQ: VRNM) -- http://www.verenium.com/-- is a pioneer in the development and commercialization of high-performance enzymes for use in industrial processes. Verenium currently sells enzymes developed using its R&D capabilities to industrial customers globally for use in markets including biofuels, animal health and oil seed processing. The Company reported net income of $5.12 million in 2011 compared with a net loss of $5.35 million in 2010. Going Concern The Company had a loss from operations of $6.5 million for year ended Dec. 31, 2011, and had an accumulated deficit of $600.8 million as of Dec. 31, 2011. The holders of the 2007 Notes have the right to require the Company to purchase the 2007 Notes for a total cash amount equal to $34.9 million on April 2, 2012, plus accrued and unpaid interest to that date. The Company expects the holders of the 2007 Notes to exercise this right and, based on the Company's current cash resources and 2012 operating plan, the Company's existing cash resources will not be sufficient to meet the cash requirements to fund the Company's required repurchase of the 2007 Notes, planned operating expenses, capital expenditures and working capital requirements without additional sources of cash. If the Company is unable to fund the repurchase of the 2007 Notes when required or otherwise raise additional capital, the Company will need to defer, reduce or eliminate significant planned expenditures, restructure or significantly curtail the Company?s operations, sell some or all its assets, file for bankruptcy or cease operations. To the extent the Company restructures rather than repurchases all or any portion of the 2007 Notes, the Company may issue common shares or other convertible debt for the 2007 Notes that are restructured, which would result in substantial dilution to the Company's equityholders. There can be no assurance that the Company will be able to obtain any sources of financing on acceptable terms, or at all. These factors raise substantial doubt about the Company's ability to continue as a going concern. VITAMINSPICE INC: Says Jehu Hand's New Suit is Frivolous -------------------------------------------------------- VitaminSpice, Inc. will aggressively defend and address via the legal system its former counsel Jehu Hand and his conspirators. This latest lawsuit is the 7th in a string of serial filings that have been made by Jehu Hand and his shell companies. VTMS will not tolerate the outrageous allegations by Jehu Hand and his followers. Jehu Hand knows that he has filed this lawsuit in the wrong Jurisdiction as evidenced by a previous court ruling from yet another lawsuit previously filed by Jehu Hand and his conspirators dated March 18, 2011. The ruling, by Judicial Officer, David Chaffee, states unequivocally by the Superior Court for the State of California that there is no jurisdiction for a Lawsuit. The current filing is frivolous and the court has already ruled that Mr. Hand (through his shell companies and alter egos) has no Jurisdiction over VTMS. VTMS uncovered a "pump and dump" scheme that was controlled by Jehu Hand and his conspirators. Documentation from Penson Financial (Dallas, TX) demonstrates that over $1.2 million dollars was taken by Jehu Hand and his conspirators. Spartan Securities demonstrate and document Jehu Hand's apparent criminal intentions and outright forgery. In a meeting in Irvine, CA, Jehu Hand allegedly attempted to bribe Edward Bukstel, CEO of VTMS, with money to allow Jehu Hand and his associates to continue their "pump and dump" scheme. Bukstel said no to any of the bribes offered by Jehu Hand. The result is a series of meritless and frivolous Lawsuits by Jehu Hand and his shell companies that have dead or non-existent shareholders, or are alter egos of Jehu Hand. The Federal Bankruptcy Court for the Eastern District of Pennsylvania has ordered a hearing for Attorney Fees and other damages. VTMS estimates the actual and compensatory damages to be over $3 million against Jehu Hand, Ray Suprenard (Florida), Jeremiah Hand (North Carolina), and John Robison (Orange County), et al. VTMS will take all necessary actions to address the ridiculous tactics of Jehu Hand. About VitaminSpice VitaminSpice makes vitamin- and antioxidant-infused spices as food and dietary supplements. Five creditors filed an involuntary Chapter 11 petition (Bankr. E.D. Pa. Case No. 16200) against Wayne, Pennsylvania-based VitaminSpice aka Qualsec on Aug. 5, 2011. The creditors, owed roughly $414,000 in the aggregate, are: John Robison in Philadelphia, Pennsylvania; IBT South Florida, LLC, in Fort Lauderdale, Florida; Learned J. Hand in Chapel Hill, North Carolina; and Jehu Hand in Dana Point, California; and Esthetics World in Cheyenne, Wyoming. Judge Magdeline D. Coleman presides over the case. Peter Edward Sheridan, Esq. -- sheridan.pete@gmail.com -- in Philadelphia, Pennsylvania, represents the petitioning creditors. In April 2012, the bankruptcy judge dismissed the involuntary case at the behest of the Debtor. Judge Magdeline D. Coleman in Philadelphia said the creditors failed to prove the company was generally not paying its debts as they mature. The company filed a motion to dismiss the petition, saying it was filed in bad faith to stop lawsuits where the VitaminSpice was targeting Mr. Hand or his companies. VITRO SAB: Vulture Funds Ordered to Pay Legal Fees -------------------------------------------------- Vitro S.A.B. de C.V. disclosed that the Federal Unitary Second Court for the Fourth Circuit in Monterrey, Nuevo Leon, as Appeals Court, has affirmed a lower Federal court's dismissal of the eighteen involuntary bankruptcy lawsuits filed against Vitro and seventeen of its subsidiaries by dissident bondholders in December 2010. Moreover, the Appeals Court ruled that, as a result of the dismissal of the involuntary bankruptcy lawsuits, Vitro and each of its corresponding seventeen subsidiaries are now entitled to recover their corresponding legal fees and expenses from the petitioning dissident bondholders. In another legal victory for Vitro, the Third Collegiate Court for Civil Matters for the Fourth Circuit in Monterrey, Nuevo Leon, has dismissed a constitutional challenge filed by dissident bondholders against certain provisions of the Mexican Business Reorganization Act (Ley de Concursos Mercantiles) and the December 2010 ruling admitting Vitro's petition to commence the reorganization phase of its voluntary prepackaged insolvency proceeding in Mexico. The Collegiate Court's dismissal cannot be challenged further and may negatively impact the dissident bondholders' chances for success in other pending appeals and constitutional challenges in Mexico relating to Vitro's now- completed insolvency proceeding. Mr. Claudio Del Valle, Vitro's Chief Restructuring Officer stated, "We are pleased that in both of these rulings, the nature of the tactics employed by the so-called vulture funds will have consequences against them. In particular, the ruling by the Second Appeals Court orders the vulture funds to reimburse Vitro and its subsidiaries for their legal fees and expenses in defending against the involuntary bankruptcy lawsuits, in amounts to be determined in accordance with the relevant Mexican law." "As previously reported, notwithstanding these and other efforts by the highly litigious vulture funds, Vitro has successfully implemented its recently approved concurso plan in Mexico, and is awaiting a decision on its request to enforce the concurso plan in the U.S. following a hearing next month before the U.S. bankruptcy court in Dallas, Texas. In the meantime, we will continue to focus on operational excellence and delivering value for our customers." About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. But an appellate court in Mexico reinstated the reorganization in April 2011. Following the reinstatement, Vitro SAB on April 14, 2011, re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11- 11754). The Vitro parent received sufficient acceptances of its reorganization by using the US$1.9 billion in debt owing to subsidiaries to vote down opposition by bondholders. The holders of US$1.2 billion in defaulted bonds opposed the Mexican reorganization plan because shareholders could retain ownership while bondholders aren't being paid in full. Vitro announced in March 2012 that it has implemented the reorganization plan approved by a judge in Monterrey, Mexico. In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. Blackstone Advisory Partners L.P. serves as financial advisor to the Committee. The U.S. Vitro companies sold their assets to American Glass Enterprises LLC, an affiliate of Sun Capital Partners Inc., for US$55 million. U.S. subsidiaries of Vitro SAB are having their cases converted to liquidations in Chapter 7, court records in January 2012 show. In December, the U.S. Trustee in Dallas filed a motion to convert the subsidiaries' cases to liquidations in Chapter 7. The Justice Department's bankruptcy watchdog said US$5.1 million in bills were run up in bankruptcy and hadn't been paid. VITRO SAB: NY Appeals Court Won't Enforce Mexican Court Ruling -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports Vitro SAB bondholders won a skirmish with the Mexican glassmaker when a New York state appellate court refused to enforce a ruling from a court in Mexico. According to the report, in New York state court, bondholders were suing Vitro operating subsidiaries that weren't in bankruptcy anywhere. Only the Vitro parent, which has no operations, was in bankruptcy reorganization in Mexico. The parent's plan purported to reduce the non-bankrupt subsidiaries' guarantees on the defaulted bonds. In state court, the trial judge ruled in favor of bondholders and held the subsidiaries liable on their guarantees of the debt. According to the report, the ruling was upheld by the Appellate Division, First Department in Manhattan, an intermediate state appellate court. The appeals court, in a unanimous opinion, rejected Vitro's argument that New York courts should uphold the Mexican court's ruling that reduced the subsidiaries' obligations on the bonds. The Appellate Division noted how the subsidiaries signed broad guarantees agreeing that the debt would be governed by New York law while waiving "any rights under Mexican laws." Mr. Rochelle notes that whether the bondholders can once and for all block enforcement of rulings from Mexico will depend on the outcome of two separate proceedings in federal courts. The bondholders argued an appeal early this month in the U.S. Court of Appeals in New Orleans, where the outcome conceivably could block enforcement of the Mexican reorganization in the U.S. A trial is scheduled June 4 in U.S. Bankruptcy Court in Dallas, where the primary question will be the enforceability of the Mexican reorganization in the U.S. The state court appeal is Vitro SAB de CV v. Elliott International LP, 652146/10, New York Appellate Division, 1st Department (Manhattan). The suit in bankruptcy court to decided if the Mexican reorganization will be enforced in the U.S. is Vitro SAB de CV v. ACP Master Ltd. (In re Vitro SAB de CV), 12-03027, U.S. Bankruptcy Court, Northern District of Texas (Dallas). The bondholders' appeal in the circuit court is Ad Hoc Group of Vitro Noteholders v. Vitro SAB de CV (In re Vitro SAB de CV), 11-11239, U.S. Court of Appeals for the Fifth Circuit (New Orleans). The bondholders' appeal of Chapter 15 recognition in district court is Ad Hoc Group of Vitro Noteholders v. Vitro SAB de CV (In re Vitro SAB de CV), 11-02888, U.S. District Court, Northern District of Texas (Dallas). About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. But an appellate court in Mexico reinstated the reorganization in April 2011. Following the reinstatement, Vitro SAB on April 14, 2011, re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11- 11754). The Vitro parent received sufficient acceptances of its reorganization by using the US$1.9 billion in debt owing to subsidiaries to vote down opposition by bondholders. The holders of US$1.2 billion in defaulted bonds opposed the Mexican reorganization plan because shareholders could retain ownership while bondholders aren't being paid in full. Vitro announced in March 2012 that it has implemented the reorganization plan approved by a judge in Monterrey, Mexico. In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. Blackstone Advisory Partners L.P. serves as financial advisor to the Committee. The U.S. Vitro companies sold their assets to American Glass Enterprises LLC, an affiliate of Sun Capital Partners Inc., for US$55 million. U.S. subsidiaries of Vitro SAB are having their cases converted to liquidations in Chapter 7, court records in January 2012 show. In December, the U.S. Trustee in Dallas filed a motion to convert the subsidiaries' cases to liquidations in Chapter 7. The Justice Department's bankruptcy watchdog said US$5.1 million in bills were run up in bankruptcy and hadn't been paid. VITRO SAB: Scores Two Victories Over Bondholders in Mexico ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Vitro SAB de CV won two victories over bondholders in courts in Mexico: (i) An appellate court in Monterrey, Mexico, upheld a ruling by a lower court that dismissed 18 involuntary bankruptcy petitions the bondholders filed against Vitro and subsidiaries. Vitro says that the appellate court is requiring the bondholders to reimburse the company for its legal expenses. (ii) Another court in Mexico denied a challenge the bondholders raised to the constitutionality of the Mexico's new bankruptcy law. According to the Mr. Rochelle, in the U.S., the bondholders won a victory on May 11 when the U.S. bankruptcy judge in Dallas refused a request by Vitro to delay a pivotal trial on whether the glass maker's Mexican reorganization will be enforced in the U.S. Bondholders also won a victory last week when a state appellate court upheld the liability of Vitro subsidiaries to stand behind their guarantees on the bonds. The suit in bankruptcy court to decided if the Mexican reorganization will be enforced in the U.S. is Vitro SAB de CV v. ACP Master Ltd. (In re Vitro SAB de CV), 12-03027, U.S. Bankruptcy Court, Northern District of Texas (Dallas). The bondholders' appeal in the circuit court is Ad Hoc Group of Vitro Noteholders v. Vitro SAB de CV (In re Vitro SAB de CV), 11-11239, 5th U.S. Circuit Court of Appeals (New Orleans). The bondholders' appeal of Chapter 15 recognition in district court is Ad Hoc Group of Vitro Noteholders v. Vitro SAB de CV (In re Vitro SAB de CV), 11-02888, U.S. District Court, Northern District of Texas (Dallas). About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. But an appellate court in Mexico reinstated the reorganization in April 2011. Following the reinstatement, Vitro SAB on April 14, 2011, re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11- 11754). The Vitro parent received sufficient acceptances of its reorganization by using the US$1.9 billion in debt owing to subsidiaries to vote down opposition by bondholders. The holders of US$1.2 billion in defaulted bonds opposed the Mexican reorganization plan because shareholders could retain ownership while bondholders aren't being paid in full. Vitro announced in March 2012 that it has implemented the reorganization plan approved by a judge in Monterrey, Mexico. In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. Blackstone Advisory Partners L.P. serves as financial advisor to the Committee. The U.S. Vitro companies sold their assets to American Glass Enterprises LLC, an affiliate of Sun Capital Partners Inc., for US$55 million. U.S. subsidiaries of Vitro SAB are having their cases converted to liquidations in Chapter 7, court records in January 2012 show. In December, the U.S. Trustee in Dallas filed a motion to convert the subsidiaries' cases to liquidations in Chapter 7. The Justice Department's bankruptcy watchdog said US$5.1 million in bills were run up in bankruptcy and hadn't been paid. WESTLAKE CHEMICAL: Moody's Confirms 'Ba3' CFR; Outlook Stable ------------------------------------------------------------- Moody's Investors Service confirmed the Baa3 debt ratings of Westlake Chemical Corporation and the ratings (Ba3 Corporate Family Rating) of Georgia Gulf Corporation (GGC) following Westlake's announcement that it would no longer pursue the unsolicited offer that it initially made to acquire GGC in January. The outlook for both companies is stable. Moody's views the bid for GGC as a unique strategic opportunity that could have provided significant synergies. However, the acquisition, if financed entirely with debt, would have weakened the credit metrics supporting Westlake's investment grade rating. Furthermore, Westlake's rating does not incorporate the potential for another transaction of more than $1 billion at the current time given the high level of capital spending that is anticipated to fund its future growth. Ratings Confirmed: Issuer: Westlake Chemical Corporation Senior Unsecured Regular Bond/Debenture at Baa3 Issuer: Louisiana Loc Govt Envir Fac & Comm Dev Auth Senior Unsecured Revenue Bonds at Baa3 Senior Unsecured Revenue Bonds at Baa3 Issuer: Georgia Gulf Corporation Probability of Default Rating at Ba3 Corporate Family Rating at Ba3 Senior Secured Regular Bond/Debenture at B1 Outlook Actions: Issuer: Westlake Chemical Corporation Outlook, Changed to Stable from Rating Under Review Issuer: Georgia Gulf Corporation Outlook, Changed to Stable from Rating Under Review Ratings assigned: Issuer: Georgia Gulf Corporation Speculative Grade Liquidity Rating at SGL -- 1 Ratings Rationale Westlake's Baa3 senior unsecured rating reflects its strong financial metrics and liquidity profile, disciplined investment policy, vertical integration, and less commoditized downstream plastics portfolio (large percentage of LDPE and more specialized plastics relative to other producers). The ratings are tempered by its exposure to volatile feedstock and selling prices, the large capital requirements necessary to build new ethylene or chlor alkali capacity, limited product diversity, its size relative to other commodity plastics producers, the regional nature of its operations, and the limited number and location of its production facilities. The key ratings drivers are the company's conservative fiscal policies and the sustainability of the current Gulf Coast feedstock advantage relative to key export markets (Asia & South America). Georgia Gulf's Ba3 Corporate Family Rating (CFR) reflects its strong financial metrics, the sustainable expansion of the US export market for PVC and benefit from restructuring programs initiated during the downturn. The improvement in the U.S. PVC market should allow the company to maintain healthy margins and keep PVC and chlor alkali production near capacity over the next several years. The improvement in the export market for PVC provides a stark contrast to domestic demand, which remains depressed relative to levels experienced prior to the financial crisis. GGC's strong financial performance is tempered by its narrow product portfolio, limited operational and geographic diversity (four commodity facilities on the Gulf Coast), substantial exposure to the North American housing market, exposure to volatile petrochemical feedstocks (ethylene, propylene and benzene) and the seasonality of its building products business. While credit metrics are stronger than the CFR would imply, Moody's believes there is some uncertainty over the base level of profitability in the chlorovinyls segment by 2014. If reported EBITDA is sustainable in the $300 million range in 2015, then there would be further upside to the rating. LTM March 31, 2012 financial metrics were 2.9x Debt/EBITDA and Retained Cash Flow/Debt of 22%. Moody's assigned a SGL-1 Speculative Grade Liquidity rating to GGC. Its liquidity is supported by its cash flow from operations, $39 million of cash balances, and $258 million of availability under its $300 million ABL revolver. Westlake Chemical Corporation, headquartered in Houston, TX, is a producer of commodity petrochemicals (ethylene and styrene), plastics (polyvinyl chloride and polyethylene), as well as compounded PVC resins and fabricated PVC products (window and door profiles, siding, etc.). Revenues were $3.8 billion for the LTM ended March 31, 2012. Georgia Gulf Corporation (GGC), headquartered in Atlanta, Georgia, is a producer of commodity chemicals including chlorovinyls (chlorine, caustic soda, vinyl chloride monomer, polyvinyl chloride resins and vinyl compounds), PVC fabricated products (pipe, siding, window profiles, moldings, etc.), and aromatics (cumene, phenol and acetone). The company generated revenues of $3.3 billion for the LTM ended March 31, 2012. WHITETAIL WOODS: Marine Bank Wins Dismissal of Bankruptcy Case -------------------------------------------------------------- Bankruptcy Judge Susan V. Kelley dismissed the Chapter 11 case of Whitetail Woods, LLC, at the behest of Marine Bank n/k/a CIBM Bank. The judge noted that the Debtor is using the Chapter 11 case to obtain a stay pending an appeal in state court over a dispute with the bank, which has sought a receiver for the Debtor's property. "This is an inappropriate use of Chapter 11, and the Debtor's dispute with the Bank should return to the State Court," Judge Kelley said. The Debtor owns one uninhabitable partially completed ranch home and some vacant lots. The Court noted all of the assets were transferred to the Debtor by another entity owned by William Fine. The Debtor's petition states that it is a small business debtor; this designation later was amended and removed. The Debtor's attorney's employment was not approved for over 60 days after the case was filed because of defects in his application papers. The Debtor had not filed an operating report since a late report filed Jan. 20, 2012. On April 19, 2012, it filed three monthly operating reports, each showing that the Debtor is conducting no business whatsoever and merely is accruing legal and other fees. A copy of the Court's May 10, 2012 Memorandum Decision is available at http://is.gd/3o7pQzfrom Leagle.com. Whitetail Woods, LLC, filed for Chapter 11 bankruptcy (Bankr. E.D. Wis. Case No. 11-37946) on Dec. 2, 2011, estimating under $1 million in assets and debts. Joseph W. Seifert, Esq., at Seifert Law Office, serves as the Debtor's bankruptcy counsel. Z TRIM HOLDINGS: Sells 744,711 Shares to Brightline for $1.1MM -------------------------------------------------------------- Z Trim Holdings, Inc., on May 8, 2012, entered into a private placement subscription agreement with Brightline Ventures I-B, LLC, pursuant to which the Company sold 744,711 shares of common stock, for a price of $1.50 per share and received gross proceeds of $1,117,067. The Subscription Agreement contains representations and warranties that the parties made to, and solely for the benefit of, the other in the context of all of the terms and conditions of the Subscription Agreement and in the context of the specific relationship between the parties. The provisions of the Subscription Agreement, including the representations and warranties contained therein, are not for the benefit of any party other than the parties to that Subscription Agreement, and are not intended as documents for investors and the public to obtain factual information about the current state of affairs of the parties to those documents and their agreements. The Company expects to use these proceeds from the sale of the Common Stock, net of transaction expenses, for general corporate purposes, including working capital. About Z Trim Mundelein, Ill.-based Z Trim Holdings, Inc., is a functional food ingredient company which provides custom product solutions that help answer the food industry's problems. Z Trim's revolutionary technology provides value-added ingredients across virtually all food industry categories. Z Trim's all-natural products, among other things, help to reduce fat and calories, add fiber, provide shelf-stability, prevent oil migration, and add binding capacity -- all without degrading the taste and texture of the final food products. The Company reported a net loss of $6.94 million in 2011, compared with a net loss of $10.91 million in 2010. The Company's balance sheet at Dec. 31, 2011, showed $4.27 million in total assets, $13.01 million in total liabilities, $3.85 million in total commitment and contingencies and a $12.59 million total stockholders' deficit. M&K CPAs,PLLC, in Houston, Texas, expressed substantial doubt about the Company's ability to continue as a going concern following the 2011 financial results. The independent auditors noted that the Company had a working capital deficit and reoccurring losses as of Dec. 31, 2011. * S&P: Global Default Count Rises Over the Last Six Months ---------------------------------------------------------- Globally, 28 companies (23 public and five confidentially rated) defaulted in the first quarter of 2012, said an article published May 11 by Standard & Poor's Global Fixed Income Research, titled "Global Corporate Quarterly Default Update And Rating Transitions." The volume of rated debt affected by defaulters in the first quarter was $31.7 billion. Of the 28 defaulted entities, 15 were domiciled in the U.S., two were in China and Israel, and one each was from Bahrain, Brazil, Canada, Indonesia, Ireland, Japan, Mexico, Switzerland, and the U.K. On a trailing-12-month basis, the global speculative-grade default rate as of March 2012 was 2.4%, up from 1.7% at the end of December 2011 and 2.1% as of March 2011. The default rate -- while historically low -- has been increasing over the last seven months to more than 2% currently. "Overall, credit volatility, in our view, has been increasing over the last six months because the number of downgrades has increased across all regions," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. The downgrade-to-upgrade ratio rose to 1.64% in first-quarter 2012 from 1.51% in the previous quarter and 1.12% in the same period the previous year. The increase from the previous quarter is the result of a slight decrease in upgrades -- to 2.52% from 4.41% -- along with a decrease in downgrades -- to 4.14% from 6.63%. By rating category, default activity over the past four quarters relative to long-term averages indicates a prolonged period of favorable lending conditions globally. Even the 'CCC'/'C' rating category had a default rate over the past four quarters that was almost four percentage points lower than its long-term average. "An analysis of the transition rates during the four quarters ended March 31, 2012, suggests that ratings behavior remains consistent with long-term trends," said Ms. Vazza. "This shows a clear negative correspondence between credit quality and default probability, in our opinion." * Junk Default Rates Increase Fractionally in April --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that according to a May 7 report from Moody's Investors Service, defaults among junk-rated companies inched up in April, although not enough to presage an upsurge in major corporate bankruptcies. The worldwide default rate on junk-rated companies rose in April to 2.6% from 2.5% in March. In the U.S., the junk default rate for April was 3%, compared with 2.9% in March. This time last year, the comparable U.S. default rate was 2.6%. By dollar volume, default rates are even lower. In the U.S., the default rate on junk debt was unchanged in April at 1.5%. Last year at this time, the comparable default rate was 1.4%, Moody's said. According to Mr. Rochelle, one statistic pointing toward increasing trouble is Moody's index measuring the percentage of companies with debt trading at distress levels. The distress index in April was 17%, up from 6% a year ago. The April distress index was down from 17.2% in March, Moody's said. Debt is considered distressed if the yield is 10 percentage points more than comparable Treasury securities. Moody's predicts that the junk default rate will rise to 3.1% by the end of 2012, before declining to 2.8% by April 2013, still below the average default rate of 4.8% since 1983. * Large Bank Stress Testing Guidance Finalized ---------------------------------------------- The Federal Reserve Board, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation on Monday issued final supervisory guidance regarding stress-testing practices at banking organizations with total consolidated assets of more than $10 billion. The guidance highlights the importance of stress testing at banking organizations as an ongoing risk management practice that supports a banking organization's forward-looking assessment of its risks and better equips it to address a range of adverse outcomes. The recent financial crisis underscored the need for banking organizations to incorporate stress testing into their risk management practices, demonstrating that banking organizations unprepared for particularly adverse events and circumstances can suffer acute threats to their financial condition and viability. This guidance builds upon previously issued supervisory guidance that discusses the uses and merits of stress testing in specific areas of risk management. The guidance outlines general principles for a satisfactory stress testing framework and describes various stress testing approaches and how stress testing should be used at various levels within an organization. The guidance also discusses the importance of stress testing in capital and liquidity planning and the importance of strong internal governance and controls as part of an effective stress-testing framework. The guidance does not implement the stress testing requirements in the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) or in the Federal Reserve Board's capital plan rule that apply to certain companies, as those requirements have been or are being implemented through separate proposals by the respective agencies. However, the agencies expect that banking organizations with total consolidated assets of more than $10 billion would follow the principles set forth in the guidance -- as well as other relevant supervisory guidance -- when conducting stress testing in accordance with the Dodd-Frank Act, the capital plan rule, and other statutory or regulatory requirements. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- ABSOLUTE SOFTWRE ABT CN 125.3 (7.2) 10.8 ACCO BRANDS CORP ABD US 1,116.7 (61.9) 316.8 AMC NETWORKS-A AMCX US 2,183.9 (1,037.0) 525.8 AMER AXLE & MFG AXL US 2,328.7 (419.6) 187.0 AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2) AMERISTAR CASINO ASCA US 2,012.0 (90.6) (33.0) AMYLIN PHARM INC AMLN US 1,870.2 (138.7) 125.2 ANOORAQ RESOURCE ARQ SJ 893.0 (191.0) 24.6 ARRAY BIOPHARMA ARRY US 82.2 (127.2) (15.1) AUTOZONE INC AZO US 6,056.5 (1,295.5) (608.2) BAZAARVOICE INC BV US 46.8 (15.4) (18.2) BOSTON PIZZA R-U BPF-U CN 146.9 (105.3) (2.0) CABLEVISION SY-A CVC US 7,143.3 (5,560.3) (240.5) CAPMARK FINANCIA CPMK US 20,085.1 (933.1) - CARMIKE CINEMAS CKEC US 422.9 (5.6) (33.4) CC MEDIA-A CCMO US 16,542.0 (7,471.9) 1,556.3 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) CERES INC CERE US 33.1 (13.7) 12.0 CHENIERE ENERGY CQP US 1,737.3 (545.0) 57.7 CHENIERE ENERGY LNG US 2,915.3 (173.0) 6.5 CHOICE HOTELS CHH US 447.7 (25.6) 10.2 CIENA CORP CIEN US 1,918.3 (21.1) 918.6 CINCINNATI BELL CBB US 2,714.7 (715.2) (35.4) CLOROX CO CLX US 4,290.0 (199.0) (289.0) CROWN HOLDINGS I CCK US 6,868.0 (239.0) 318.0 DEAN FOODS CO DF US 5,754.4 (98.7) 220.8 DELTA AIR LI DAL US 43,499.0 (1,396.0) (4,972.0) DENNY'S CORP DENN US 350.5 (9.7) (25.9) DIRECTV-A DTV US 18,423.0 (2,842.0) (502.0) DISH NETWORK-A DISH US 11,470.2 (419.0) 527.3 DISH NETWORK-A EOT GR 11,470.2 (419.0) 527.3 DOMINO'S PIZZA DPZ US 480.5 (1,209.7) 129.7 DUN & BRADSTREET DNB US 1,977.1 (740.2) (226.6) FREESCALE SEMICO FSL US 3,415.0 (4,480.0) 1,432.0 GENCORP INC GY US 931.2 (189.7) 108.9 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GOLD RESERVE INC GRZ US 78.3 (25.8) 56.9 GOLD RESERVE INC GRZ CN 78.3 (25.8) 56.9 GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5 HCA HOLDINGS INC HCA US 26,898.0 (7,014.0) 1,679.0 HUGHES TELEMATIC HUTC US 94.0 (111.8) (39.0) HUGHES TELEMATIC HUTCU US 94.0 (111.8) (39.0) INCYTE CORP INCY US 329.0 (227.1) 175.2 IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 153.1 (49.1) 2.3 JUST ENERGY GROU JE US 1,644.4 (394.5) (338.4) JUST ENERGY GROU JE CN 1,644.4 (394.5) (338.4) LIN TV CORP-CL A TVL US 1,077.7 (80.9) 56.6 LIZ CLAIBORNE LIZ US 950.0 (109.0) 124.8 LORILLARD INC LO US 3,008.0 (1,513.0) 1,079.0 MARRIOTT INTL-A MAR US 5,910.0 (781.0) (1,234.0) MEAD JOHNSON MJN US 2,766.8 (168.0) 689.6 MERITOR INC MTOR US 2,553.0 (983.0) 180.0 MERRIMACK PHARMA MACK US 85.3 (21.7) 39.4 MONEYGRAM INTERN MGI US 5,175.6 (110.2) (40.4) MOODY'S CORP MCO US 2,876.1 (158.4) 290.4 NATIONAL CINEMED NCMI US 820.2 (346.8) 68.4 NAVISTAR INTL NAV US 11,503.0 (190.0) 2,238.0 NEXSTAR BROADC-A NXST US 595.0 (183.4) 39.6 NPS PHARM INC NPSP US 214.0 (46.1) 156.0 NYMOX PHARMACEUT NYMX US 6.4 (5.2) 2.9 OMEROS CORP OMER US 27.0 (5.6) 7.0 OTELCO INC-IDS OTT US 317.7 (12.4) 18.6 OTELCO INC-IDS OTT-U CN 317.7 (12.4) 18.6 PALM INC PALM US 1,007.2 (6.2) 141.7 PARABEL INC PABL US 11.2 (81.8) (83.2) PDL BIOPHARMA IN PDLI US 269.5 (204.3) 100.5 PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PRIMEDIA INC PRM US 208.0 (91.7) 3.6 PROTECTION ONE PONE US 562.9 (61.8) (7.6) QUALITY DISTRIBU QLTY US 302.4 (106.2) 45.8 REGAL ENTERTAI-A RGC US 2,341.3 (572.5) 2.8 RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) RENTECH NITROGEN RNF US 152.4 (76.1) (32.3) REVLON INC-A REV US 1,157.1 (692.9) 183.3 RSC HOLDINGS INC RRR US 3,141.0 (38.4) (1.0) RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 SALLY BEAUTY HOL SBH US 1,792.7 (168.5) 482.3 SINCLAIR BROAD-A SBGI US 1,571.4 (111.4) 14.1 SINCLAIR BROAD-A SBTA GR 1,571.4 (111.4) 14.1 SUN COMMUNITIES SUI US 1,368.0 (100.7) - TAUBMAN CENTERS TCO US 3,336.8 (256.2) - THERAVANCE THRX US 258.8 (87.1) 199.3 UNISYS CORP UIS US 2,612.2 (1,311.0) 487.3 VECTOR GROUP LTD VGR US 927.8 (89.0) 194.5 VERISIGN INC VRSN US 1,856.2 (88.1) 788.9 VERISK ANALYTI-A VRSK US 1,541.1 (98.5) 104.0 VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) WEIGHT WATCHERS WTW US 1,121.6 (409.8) (279.7) ********* 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, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2012. 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 ***