TCR_Public/120629.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

              Friday, June 29, 2012, Vol. 16, No. 179

                            Headlines

ACL INVESTMENTS: Case Summary & 12 Largest Unsecured Creditors
ADELPHIA COMMS: Buchanan Agrees to Pay $60MM to Settle Claims
AEROGROW INTERNATIONAL: Incurs $3.5-Mil. Net Loss in Fiscal 2012
ALPHA NATURAL: Moody's Lowers CFR/PDR to 'B1'; Outlook Stable
ALTEGRITY INC: Moody's Hikes Rating on $500MM Unsec Notes to Caa1

AMERICAN AIRLINES: Rejection of Chicago Ground Lease Approved
AMERICAN AIRLINES: Retiree Committee Hiring Jenner & Block
AMERICAN AIRLINES: Fee Examiner Proposes Bernstein as Counsel
AMERICAN AIRLINES: Fee Examiner Taps Stuart Maue as Advisor
APPLIED DNA: Sells 35.5 Million Common Shares for $1.5 Million

APPLIED DNA: To Issue Add'l 250MM Under 2005 Incentive Plan
ARCAPITA BANK: Court OKs Layoffs for 96, Incentives for 59
ARCH COAL: Moody's Lowers CFR/PDR to 'B2'; Outlook Stable
BEHRINGER HARVARD: 2 Funds Struggle to Make Loan Payments
BERNARD L. MADOFF: Wins Appeal Over $1.025BB Tremont Settlement

BERNARD L. MADOFF: Younger Brother to Enter Guilty Plea
BLITZ USA: To Shut Down Operations by End of July
BLUE RAVEN: To Be Sold July 25 Without Formal Auction
BROOKSTONE INC: S&P Withdraws 'B-' CCR on Lack of Market Interest
BUFFETS INC: Second Amended Chapter 11 Plan Confirmed

BUFFETS INC: Shutters Ryan's Grill Outlet in Houma, La.
CAJUN ELECTRIC: 5th Cir. Clears SWEPCO of Reimbursement Obligation
CAMBRIDGE HEART: Five Directors Elected at Annual Meeting
CAPE JASMINE: Case Summary & 20 Largest Unsecured Creditors
CCGI HOLDING: Moody's Withdraws 'B3' CFR on Debt Repayment

CERIDIAN CORP: S&P Rates $720MM Senior Notes & Term Loan 'B-'
CINRAM INT'L: Moody's Lowers CFR/PDR to 'C/D' Over CCAA Filing
CHOICE HOTELS: S&P Cuts Rating on $250-Mil. Senior Notes to 'BB'
CORNERSTONE BANCSHARES: Appoints Nathaniel Hughes as CEO
CRYOPORT INC: Incurs $7.8 Million Net Loss in Fiscal 2012

D.R. HORTON: Strong Liquidity Cues Fitch to Affirm Low-B Ratings
DBSI INC: Trustee Files Investor Suit Against Broker-Dealers
DELTA AIR: Moody's Assigns 'Ba3' Rating to Class B Tranche
DEWEY & LEBOEUF: Barclays, Citi Tell Ex-Partners to Repay Loans
DOLLAR GENERAL: Moody's Rates $450MM Sr. Unsecured Notes 'Ba2'

DM DEVELOPMENT: Involuntary Chapter 11 Case Summary
EASTMAN KODAK: July 26 Hearing to Name Court for Patent Issues
FASHION PLACE: Wins Confirmation of 2nd Amended Plan
FIRST HORIZON: Mortgage Repurchase Cues Fitch to Lower Ratings
FIRST SECURITY: Nine Directors Elected at Annual Meeting

FISH & FISHER: Merchants & Farmers Bank Barred From Amending Suit
FRANKLIN CREDIT: Sets July 6 as Record Date for Distribution
GARLOCK SEALING: WD Pa. Court Defers to Delaware District Court
GENERAL MOTORS: Salina Claims $13-Mil. Shortfall in Superfund Deal
GENWORTH FINC'L: Moody's Places 'Ba1' Sub. Debt Rating on Review

GEOEYE INC: S&P Lowers CCR to 'B-' on NGA Funding Uncertainty
GLOBAL AVIATION: S&P Withdraws 'D' Corporate Credit Rating
HAMPTON ROADS: Closes on $50MM Private Placement of Common Stock
HEARTHSTONE HOMES: Panel's Deadline to Fight Disband Motion Moved
HRK HOLDINGS: Manatee County Property Owner Files in Tampa

INTELLIGRATED INC: S&P Affirms 'B' Corporate Credit Rating
LDK SOLAR: Incurs $177 Million Net Loss in First Quarter
LIBERTY INTERACTIVE: Moody's Affirms B1 CFR, Rates QVC Notes Ba2
LIGHTSQUARED INC: Falcone, Harbinger Sued for Securities Fraud
LONG ISLAND RUBBISH: Judge Grossman Replaces Eisenberg

LUMBER PRODUCTS: Rugby Acquires All Assets Under Section 363 Sale
LYMAN LUMBER: Has Green Light to Hire Real Estate Counsel
MARIANA RETIREMENT: Won't Appeal Case Dismissal Order
MARITIME SERVICES: Case Summary & 20 Largest Unsecured Creditors
MF GLOBAL: Canadian Settlement Brings $60.6 Million

MMRGLOBAL INC: Extends Maturity of RHL Group Note for One Year
MOUNTAIN COUNTRY: Court Accepts Involuntary Chapter 11 Petition
MOUNTAIN NATIONAL: Bank Now "Significantly Undercapitalized"
MP3TUNES LLC: CEO Not Covered by Automatic Stay in Chapter 7
NORTHAMPTON GENERATING: Gets Short Exclusivity Extension

NORTHSTAR AEROSPACE: Wins Court OK to Auction Assets
OASIS PETROLEUM: Moody's Lifts CFR to 'B2'; Rates New Notes 'B3'
OPTIMUMBANK HOLDINGS: Fails to Comply with Nasdaq Bid Price Rule
PAL CORPORATION: Case Summary & Largest Unsecured Creditor
PETROPLUS HOLDINGS: JV to Convert Coryton Refinery Into Terminal

PHILADELPHIA ORCHESTRA: No Creditors Vote Against Plan
PHOENIX PREMIER: Plan Lacks "Good Faith" Requirement
PLUM TV: Sells Business, Converts Case to Chapter 7
PREMIER PAVING: Creditors Can Hire Onsager Staelin as Counsel
QVC INC: Fitch Assigns 'BB' Issuer Default Rating

RE LOANS: Court Confirms Modified Fourth Amended Plan
RESIDENTIAL CAPITAL: Has Final Approval of $1.4BB Barclays Loan
RESIDENTIAL CAPITAL: Wins Nod of $220-Mil. Ally Facility
RESIDENTIAL CAPITAL: Wins Approval to Use Cash Collateral
RITZ CAMERA: Crystal Finance DIP Facility Has Interim Approval

RITZ CAMERA: Sec. 341 Creditors' Meeting Set for July 31
RITZ CAMERA: Can Hire Kurtzman Carson as Claims Agent
RITZ CAMERA: DIP Lender, Kimco Realty Tap Morgan Lewis as Counsel
ROSETTA GENOMICS: NYSDOH Conditionally Approves miRview
RUDEN MCCLOSKY: Reiterates Buyer's Chapter 7 Objections

SAFETY-KLEEN: CBS Off Hook in Kansas Facility Cleanup
SAGE COLLEGES: Moody's Affirms 'B2' Long-Term Debt Rating
SATNAM LODGING: Case Summary & 20 Largest Unsecured Creditors
SEALY CORP: Reports $1.6 Million Net Income in Q2 2012
SEQUA CORP: S&P Raises Corp. Credit Rating to 'B'; Outlook Stable

SF FUEL: Voluntary Chapter 11 Case Summary
SHAMROCK-HOSTMARK: 5 Hotels File for Chapter 11 in Chicago
SM ENERGY: S&P Rates New $300MM Senior Unsecured Notes 'BB'
STOCKTON, CA: Moody's Cuts General Fund Debt Rating to 'Caa3'
SUNSHINE GROUP: Voluntary Chapter 11 Case Summary

THERMOENERGY CORP: Has Development Agreement with Itea
THERMODYNETICS INC: Suspending Filing of Reports with SEC
TRAINOR GLASS: Hires Toney Capital to Auction Fishing Boat
TRAINOR GLASS: Court Approves Branford as Auctioneer
USG CORP: Contributes 1.2-Mil. Shares to Retirement Plan Trust

VIEW SYSTEMS: Stegman & Company Replaces Seale as Accountants
VITRO SAB: Must Have Stay Immediately to Halt Asset Seizures
VUZIX CORP: Five Directors Elected at Annual Meeting
WATERLOO GARDENS: Case Summary & 20 Largest Unsecured Creditors
WATERLOO LANDSCAPING: Voluntary Chapter 11 Case Summary

WATERSCAPE RESORT: Owes $11MM for Unpaid Work, Developer Says
YOUR LOCAL MARKET: Case Summary & 20 Largest Unsec. Creditors
ZAYO GROUP: S&P Keeps 'B' Corp. Credit Rating; Outlook Stable

* Judge Rakoff Tips His Hand on Upcoming Safe-Harbor Case
* Multiple Bankruptcies Add Only 90 Days for Tax Claims
* Leveraged Buyout Financing Rekindles Junk-Bond Issuance

* Moody's Says Weak Consumer Confidence Hits U.S. Gaming Sector
* Moody's Cuts Ratings on Spanish Banks' North American Units

* Pa. Lawmakers to Extend Bankr. Moratorium for Distressed Cities
* Living Wills Give Banks a Chance to Uncover Own Weak Spots

* BOOK REVIEW: Hospital Turnarounds - Lessons in Leadership

                            *********

ACL INVESTMENTS: Case Summary & 12 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: ACL Investments
        2805 East Oakland Park Blvd, #108
        Fort Lauderdale, FL 33306

Bankruptcy Case No.: 12-25527

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Southern District of Florida (Fort Lauderdale)

Judge: Raymond B. Ray

Debtor's Counsel: David H. Haft, Esq.
                  LAW FIRM OF GARY M. SINGER, P.A.
                  4577 Nob Hill Rd #206
                  Sunrise, FL 33351
                  Tel: (954) 851-1448
                  Fax: (954) 252-2189
                  E-mail: david@garysingerlaw.com

Estimated Assets: $100,001 to $500,000

Estimated Debts: $1,000,001 to $10,000,000

A copy of the Company's list of its 12 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/flsb12-25527.pdf

The petition was signed by Carlos Prieto, general partner.


ADELPHIA COMMS: Buchanan Agrees to Pay $60MM to Settle Claims
-------------------------------------------------------------
Maria Chutchian at Bankruptcy Law360 reports that Buchanan
Ingersoll & Rooney PC has agreed to pay $60 million to settle
claims surrounding its representation of Adelphia Communications
Corp. before the company filed for Chapter 11 protection,
according to documents filed in New York bankruptcy court
Wednesday.

Of that amount, $20 million will go directly to the Adelphia
Recovery Trust, and the remaining $40 million will be divided
among the trust and Adelphia investors who filed separate claims
against the firm, according to Bankruptcy Law360.

                   About Adelphia Communications

Based in Coudersport, Pennsylvania, Adelphia Communications
Corporation was once the fifth-biggest cable company.  Adelphia
served customers in 30 states and Puerto Rico, and offered analog
and digital video services, Internet access and other advanced
services over its broadband networks.

Adelphia collapsed in 2002 after disclosing that founder John
Rigas and his family owed $2.3 billion in off-balance-sheet debt
on bank loans taken jointly with the company.  Mr. Rigas is
serving 12 years in prison, and his son Timothy is serving 15
years.

Adelphia Communications and its more than 200 affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 02-41729) on
June 25, 2002.  Willkie Farr & Gallagher represented the Debtors
in their restructuring effort.  PricewaterhouseCoopers served as
the Debtors' financial advisor.  Kasowitz, Benson, Torres &
Friedman LLP and Klee, Tuchin, Bogdanoff & Stern LLP represented
the Official Committee of Unsecured Creditors.

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas-Managed Entities, were
entities that were previously held or controlled by members of the
Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision LLC.  The RME Debtors filed for Chapter 11 protection
(Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642) on March 31,
2006.  Their cases were jointly administered under Adelphia
Communications and its debtor-affiliates' Chapter 11 cases.

The Bankruptcy Court confirmed the Debtors' Joint Chapter 11 Plan
of Reorganization on Jan. 5, 2007.  That plan became effective on
Feb. 13, 2007.

The Adelphia Recovery Trust, a Delaware Statutory Trust, was
formed pursuant to the Plan.  The Trust holds certain litigation
claims transferred pursuant to the Plan against various third
parties and exists to prosecute the causes of action transferred
to it for the benefit of holders of Trust interests.  Lawyers at
Kasowitz, Benson, Torres & Friedman, LLP (NYC), represent the
Adelphia Recovery Trust.


AEROGROW INTERNATIONAL: Incurs $3.5-Mil. Net Loss in Fiscal 2012
----------------------------------------------------------------
Aerogrow International, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of $3.55 million on $8.23 million of net product sales
for the year ended March 31, 2012, a net loss of $7.92 million on
$11.31 million of net product sales for the year ended March 31,
2011, and a net loss of $6.33 million on $17.25 million of net
product sales for the year ended March 31, 2010.

The Company's balance sheet at March 31, 2012, showed
$4.37 million in total assets, $9.50 million in total liabilities
and a $5.12 million total stockholders' deficit.

AeroGrow reported an EBITDA profit of $298,000, representing the
Company's first-ever full year EBITDA profit, and a $3.1 million
improvement over the EBITDA loss reported in the prior year.  The
turnaround was driven by the Company's success in improving
marketing efficiency, increasing gross margins, exiting low margin
sales channels, and reducing overhead costs.

"Delivering our first-ever full year EBITDA profit marks a proud
day for AeroGrow," said Mike Wolfe, AeroGrow's President and Chief
Executive Officer.  "We've worked hard to restructure our
operations, shift our focus to the direct-to-consumer sales
channels and dramatically reduce our breakeven revenue level.  Our
results for the year show the benefits of those efforts."

Ehrhardt Keefe Steiner & Hottman PC, in Denver, Colorado, did not
include a "going concern" qualification in its reporton the
financial statements for the fiscal year ended March 31, 2012.

Last year, as reported in the TCR on Aug. 30, 2011, Eide Bailly
LLP, in Fargo, North Dakota, said the Company does not currently
have sufficient liquidity to meet its anticipated working capital,
debt service and other liquidity needs in the near term, which
raise substantial doubt about the Company's ability to continue as
a going concern.

On Nov. 17, 2011, Eide Bailly LLP resigned as the independent
registered public accounting firm of the Company.  Eide Bailly had
been the independent registered public accounting firm of the
Company since Nov. 1, 2008.

A copy of the Form 10-K is available for free at:

                        http://is.gd/DjelYT

                          About AeroGrow

Boulder, Colo.-based AeroGrow International, Inc., is a developer,
marketer, direct-seller, and wholesaler of advanced indoor garden
systems designed for consumer use and priced to appeal to the
gardening, cooking, and healthy eating, and home and office decor
markets.


ALPHA NATURAL: Moody's Lowers CFR/PDR to 'B1'; Outlook Stable
-------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating
(CFR) of Alpha Natural Resources, Inc. (Alpha) to B1 from Ba2.
Moody's also downgraded Alpha's probability of default rating
(PDR) to B1 from Ba2 and senior unsecured ratings to B2 from Ba3.
Moody's revised the company's Speculative Grade Liquidity (SGL)
rating to SGL-2 from SGL-1. The outlook is stable.

Moody's took the following rating actions:

Downgrades:

  Issuer: Alpha Natural Resources, Inc

     Corporate Family Rating, Downgraded to B1 from Ba2

     Probability of Default Rating, Downgraded to B1 from Ba2

     Speculative Grade Liquidity Rating, Downgraded to SGL-2
     from SGL-1

     Multiple Seniority Shelf, Downgraded to (P)B2 from (P)Ba3

     Senior Unsecured Regular Bond/Debenture, Downgraded to a
     range of B2, LGD4, 69% from a range of Ba3, LGD4, 68%

Outlook Actions:

  Issuer: Alpha Natural Resources, Inc

     Outlook, Changed To Stable From Negative

Ratings Rationale

The downgrade reflects weakening operating performance due to the
headwinds facing the US coal industry, and in particular the
Central Appalachian region, including increasing costs due to
difficult geology and regulatory pressures; weak international
demand for metallurgical coal due to ongoing sovereign crisis in
Europe and slowing growth rates in steel production in China; and
weak domestic demand for steam coal due to ongoing coal to gas
substitution, mild weather and environmental regulations that
disadvantage coal.

Alpha's acquisition of Massey Energy on June 1, 2011 significantly
increased Alpha's exposure to the Central Appalachian region.
After the acquisition, the company has the region's most shipments
(by volume) and largest reserves and a commanding North American
position in metallurgical coal. Unfortunately, this region has
been most affected by the ongoing coal-to-gas substitution,
increasing costs, as well as falling met coal prices and demand.
Alpha has recently announced curtailment of coal mining operations
in northern and southern Kentucky in response to the market
conditions, in line with the reduced shipment guidance for 2012
provided in May 2012.

Moody's expects that Alpha's Debt/ EBITDA, as adjusted, will be in
the 4.5x -- 6.0x range in 2012, while EBIT/ Interest will be
negative. Moody's believes that these metrics will deteriorate
further in 2013, as the company will likely continue to operate at
reduced volumes, while the average delivered price of thermal coal
will decline due to the collapse in spot prices in the last
several months. Moody's expects metallurgical coal market to
remain soft for the next several months, which will limit the
extent to which metallurgical coal business can offset the margin
compression experienced on the thermal side. Moody's expects free
cash flow to debt ratio to be below 5% in 2012, potentially
declining further in 2013.

Alpha's B1 corporate family rating continues to reflect its
position as one of the top three U.S. coal companies in terms of
production and reserves, its operating diversity with
approximately 130 coal mines and a presence in Appalachia and the
Powder River Basin (PRB), its ability to export coal though
several East Coast and Gulf terminals, blending opportunities and
synergies that arise from the Massey merger, and its spproximately
5 billion tons of reserves.

While the change in SGL rating to SGL-2 from SGL-1 reflects the
expected contraction in internal cash flows and tighter headroom
under covenants, Alpha continues to have good liquidity, including
approximately $700 million of cash, cash equivalents and
marketable securities as of March 31, 2012, and availability of
$1.1 billion under the revolver and AR securitization facilities.
On June 27, 2012, Alpha announced credit facility amendments that
temporarily relaxed financial covenants through the end of 2014.
Although Moody's expects Alpha to be in compliance with its debt
covenants, as revised, over the next twelve months, Moody's
believes that the headroom under the interest coverage covenant
may be tight in 2013.

Factors that could lead to a further downgrade include a
deterioration of prices, further cost increases, and permitting,
regulatory, or litigation matters that impact output and costs. An
increase in leverage above 5x on a sustained basis, persistently
negative free cash flows, or an erosion of liquidity would be
signs pointing to a possible downgrade.

Although upward momentum on the ratings is limited due to industry
conditions, an upgrade could result if operating performance
improves and Debt/ EBITDA is considered sustainable below 4.5x,
and free cash flow to debt is above 3%.

The principal methodology used in rating Alpha was the Global
Mining Industry Methodology published in May 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.


ALTEGRITY INC: Moody's Hikes Rating on $500MM Unsec Notes to Caa1
-----------------------------------------------------------------
Moody's Investors Service raised the ratings outlook of Altegrity,
Inc. to stable from negative, assigned a B1 rating to the
company's new $75 million revolver and withdrew the rating on the
redeemed $90 million revolver. Additionally, the senior unsecured
notes rating was upgraded to Caa1 from Caa2, reflecting
significantly less secured debt ahead of the notes as a result of
recent term loan repayments. All other ratings, including the B3
Corporate Family Rating ("CFR"), were affirmed.

Rating assigned (and Loss Given Default Assessment):

  $75 million senior secured revolver expiring November 2014, B1
  (LGD2, 26%)

Rating withdrawn due to redemption:

  $90 million first lien revolver expiring August 2013, B1
  (LGD2, 28%)

Ratings upgraded (and LGD assessments adjusted)

  $290 million 10.5% senior unsecured notes due 2015, to Caa1
  (LGD5, 76%) from Caa2 (LGD5, 79%)

  $210 million 12% senior unsecured notes due 2015, to Caa1
  (LGD5, 76%) from Caa2 (LGD5, 79%)

Ratings affirmed (and LGD assessments adjusted, as noted):

  Corporate Family Rating, B3

  Probability of Default Rating, B3

  $1,042 (originally $1,385) million senior secured term loans
  due 2015, B1 (LGD2, to 26% from 28%)

  $150 million 11.75% senior subordinated notes due 2016, Caa2
  (LGD6, to 92% from 93%)

Ratings Rationale

"The change in outlook to stable from negative reflects positive
revenue growth trends in Altegrity's commercial businesses, which
we believe will drive higher consolidated earnings in fiscal 2013
than originally anticipated," stated Moody's analyst Suzanne
Wingo. However, overall profits will likely be tempered by weak
results in the government segment where the cost to complete
certain security clearances has risen due to new requirements
under the field investigations contract. Altegrity may have the
opportunity to enhance margins in the government and commercial
screening businesses through restructuring and integration
initiatives that are currently underway. As such, Moody's expects
required debt reduction and modest EBITDA growth to lower debt /
EBITDA to about 6.7 times at the end of fiscal 2013, within the
range of other companies also at the B3 rating level. Over the
next twelve months, Moody's expects Altegrity to generate free
cash flow of at least $50 million. The outlook change further
reflects Altegrity's improved liquidity profile resulting from an
effective extension in the maturity date of the revolver to
November 2014 and from amended covenant levels.

Altegrity's B3 CFR reflects high financial leverage, despite over
$300 million of permanent debt reduction in the past year made
from proceeds of a divestiture. Continuing macroeconomic softness
and tepid employment churn rates are not expected to improve
significantly, while uncertainty builds regarding a possible U.S.
government budget sequestration and the potential negative impact
on the government segment's investigation volumes. The ratings are
supported by adequate liquidity, considerable size and scale, the
diversification of revenues, leading market positions, and the
value of the Kroll brand.

The ratings could be downgraded if revenue and earnings decline
such that interest coverage (EBITDA less capex / interest)
approaches 1x, liquidity deteriorates, or the capital structure
appears unsustainable. Conversely, the ratings could be upgraded
if the government segment's revenue and cost structure stabilize
such that debt to EBITDA can be sustained below 6x.

Altegrity provides background investigations for the U.S.
government; employment background screening for commercial
customers; technology-driven legal services and software for data
management; and investigative, analytic, consulting, due
diligence, and security services. Altegrity is principally owned
by investment funds affiliated with Providence Equity Partners.
Annual revenues are approximately $1.5 billion.

The principal methodology used in rating Altegrity was the Global
Business & Consumer Service Industry Methodology published in
October 2010. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.


AMERICAN AIRLINES: Rejection of Chicago Ground Lease Approved
-------------------------------------------------------------
Judge Sean Lane authorized the rejection of the ground lease
between American Airlines, Inc., and the City of Chicago,
effective June 21, 2012.  The deadline to file a proof of claim
arising from the rejection of the Ground Lease is on or before
July 21.  The Court also approved the letter agreement between
American and Sky Chefs, Inc.

On Oct. 8, 1969, Sky Chefs and the City entered into the Ground
Lease, which afforded Sky Chefs the use and enjoyment of certain
premises and facilities owned by the City at Chicago O'Hare
International Airport.  Sky Chefs subsequently assigned its
interests under the Ground Lease to Skyhare Corp.  In turn,
Skyhare subleased its interest in the Ground Lease back to Sky
Chefs by a Lease and Agreement.

Fifteen years later, Skyhare assigned its interest in the Ground
Lease to American.  Sky Chefs also assigned its interest in the
Lease and Agreement and its remaining interest in the Ground
Lease to American.  In turn, American subleased its interest in
the Ground Lease back to Sky Chefs by an Agreement of Sublease
for In-flight Kitchen Premises at Chicago-O'Hare International
Airport.

The City consented to the assignment of Skyhare's interests to
American and the subletting of the Premises by American to Sky
Chefs by the Sublease.  The City further released Sky Chefs of
its obligations under the Ground Lease.  The Commissioner of
Aviation of the City also gave its consent to the transactions.

The Premises currently are not being used by American or Sky
Chefs.  The Debtors seek to reject the Premises because it
constitutes an unnecessary ongoing expense and has no value to
their estates.

To consensually resolve issues relating to the Sublease, American
and Sky Chefs negotiated an agreement, which provides that the
Sublease will terminate; provided that until the Rejection Date,
Sky Chefs' obligations under the Sublease will continue to apply.

In turn, Sky Chefs will provide to American credits totaling $6.5
million against future amounts due from American to Sky Chefs for
catering and related services.  The Credits will be equally
spread over a period of five years, with annual Credits in the
amount of $1.3 million beginning on September 1, 2013.

The Parties further agree that as of the Rejection Date, American
waives any and all claims it may have against Sky Chefs relating
in any way to Sky Chefs' obligations under the Sublease.  Sky
Chefs will retain no further obligations under the Sublease.

                      About American Airlines

AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.

AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.

American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights.  The
combined network fleet numbers more than 900 aircraft.

The Company reported a net loss of $884 million on $18.02 billion
of total operating revenues for the nine months ended Sept. 30,
2011.  AMR recorded a net loss of $471 million in the year 2010, a
net loss of $1.5 billion in 2009, and a net loss of $2.1 billion
in 2008.

AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion
in total assets, $29.55 billion in total liabilities, and a
$4.83 billion stockholders' deficit.

Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors.  Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel.  Rothschild
Inc., is the financial advisor.   Garden City Group Inc. is the
claims and notice agent.

Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings.  Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.

Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).


AMERICAN AIRLINES: Retiree Committee Hiring Jenner & Block
----------------------------------------------------------
The Section 1114 Committee of Retired Employees in American
Airlines Inc.'s Chapter 11 cases seeks permission from the U.S.
Bankruptcy Court for the Southern District of New York to retain
Jenner & Block LLP as its counsel, nunc pro tunc to June 8, 2012.

As the Retiree Committee's counsel, Jenner & Block will:

  (a) provide assistance, advice and representation concerning
      any proposed modification of the benefits to be provided
      to the Retirees;

  (b) negotiate with the Debtors concerning any proposed
      modification of the Retirees' benefits in general;

  (c) represent the Retiree Committee in any proceedings and
      hearings that involve or might involve matters pertaining
      to the benefits of the Retirees;

  (d) prepare on behalf of the Retiree Committee any necessary
      adversary complaints, motions, applications, orders and
      other legal papers relating to such matters;

  (e) advise the Retiree Committee of its powers and duties;

  (f) prosecute and defend litigation matters and such
      other matters concerning any proposed modification of the
      Retirees' medical benefits,or the Retirees' benefits in
      general, that might arise;

  (g) advise the Retiree Committee with respect to bankruptcy,
      general corporate, labor, employee benefits and litigation
      issues concerning any proposed modification of the
      Retirees' medical benefits, or the Retirees' benefits in
      general; and

  (h) perform such other legal services as may be necessary
      and appropriate for the efficient and economical
      resolution of the Retiree Committee's consideration of any
      proposal to modify the Retirees' benefits.

Jenner & Block will be paid according to its professionals'
hourly rates ranging from $560 to $1,050 for partners; $330 to
$600 for associates; $180 to $295 for paralegals; and $165 to
$180 for project assistants.  The firm's professionals expected
to be most active in this engagement are:

  Name                    Title              Rate per Hour
  ----                    -----              -------------
  Catherine L. Steege     Partner                $850
  Charles B. Sklarsky     Partner                $925
  Marc B. Hankin          Partner                $875
  Melissa M. Hinds        Partner                $575
  David H. Hixson         Associate              $550
  Michael H. Matlock      Paralegal              $295

The firm will also be reimbursed for expenses to be incurred.

Catherine L. Steege, Esq., a partner at Jenner & Block LLP, in
New York -- csteege@jenner.com -- discloses that her firm
currently represents and has represented certain parties-in-
interest in matters unrelated to the Debtors, a list of which is
available for free at:

      http://bankrupt.com/misc/AmAir_JennerClients.pdf

To address certain disclosures sought by the U.S. Trustee, Ms.
Steege filed a supplemental disclosure to disclose that a certain
Jenner & Block partner who owned 5,000 shares of AMR stock has
sold her stock.  She notes that three Jenner & Block partners and
one associate served as clerks for judges in the Court.
Specifically, Patrick Trostle clerked for Judge Francis G. Conrad
from 1992 to 1994; Marc Hankin clerked for Judge Burton R.
Lifland from 1992 to 1994; Heather McArn clerked for Judge
Lifland from 1994 to 11996 and for Judge Arthur J. Gonzalez from
2007 to 2008; and Carl Wedoff clerked for Judge Stuart M.
Bernstein from 2009 to 2011.  It is expected that Mr. Hankin will
perform work for the Retiree Committee and depending on the
requirements of the client, Mr. Trostle, Ms. McArn or Mr. Wedoff
may also perform work for the Retiree Committee.

Ms. Steege further relates that American Airlines is not a
current firm client and the firm last did work for American
Airlines in 2009.  The firm represented American Airlines in
discrete matters primarily involving litigation.  The most
significant of these representations was the representation of
American Airlines in connection with lawsuits filed over the 1994
American Eagle accident in Roselawn, Indiana, and the 2001
Queens, New York accident, and the representation of American
Airlines between 1989 and 2003 in class action litigation mainly
pending in the Circuit Court of Cook County, Illinois over the
frequent flyer program.   Jenner & Block has not represented
American Airlines on any matters involving retiree benefits,
labor issues, restructuring matters, corporate work or matters
involving these Chapter 11 cases, she clarifies.

Ms. Steege says Jenner & Block is a party to a two-year agreement
with American Airlines entitled "Corporate Pricing Discount
Terms' dated February 20, 2011, which applies to tickets
purchased by the firm.  As of November 29, 2011, Jenner & Block
did not have any outstanding credits or other amounts owed to it
by American Airlines.  At the request of the U.S. Trustee, the
firm will record its time and expenses utilizing these
categories: attendance at committee meeting, committee
administration, attendance at hearings, travel, expenses,
fee/employment applications, benefits negotiations, discovery and
trial preparation, claims, she adds.

Ms. Steege maintains that Jenner & Block is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.

                      About American Airlines

AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.

AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.

American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights.  The
combined network fleet numbers more than 900 aircraft.

The Company reported a net loss of $884 million on $18.02 billion
of total operating revenues for the nine months ended Sept. 30,
2011.  AMR recorded a net loss of $471 million in the year 2010, a
net loss of $1.5 billion in 2009, and a net loss of $2.1 billion
in 2008.

AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion
in total assets, $29.55 billion in total liabilities, and a
$4.83 billion stockholders' deficit.

Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors.  Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel.  Rothschild
Inc., is the financial advisor.   Garden City Group Inc. is the
claims and notice agent.

Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings.  Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.

Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).


AMERICAN AIRLINES: Fee Examiner Proposes Bernstein as Counsel
-------------------------------------------------------------
Robert J. Keach, Esq., the court-appointed fee examiner in
American Airlines' Chapter 11 cases, seeks the Court's permission
to retain Bernstein, Shur, Sawyer & Nelson, P.A., as his counsel,
nunc pro tunc to May 1, 2012.

As the Fee Examiner's counsel, Bernstein Shur will:

  (a) review the fee applications and related invoices for
      compliance with the applicable provisions of the
      Bankruptcy Code, the Bankruptcy Rules, the U.S. Trustee
      Guidelines, and the Local Rules and Orders of the Court;

  (b) assist the Fee Examiner in any hearings or other
      proceedings before the Court to consider the Fee
      Applications including, without limitation, advocating
      positions asserted in the reports filed by the Fee
      Examiner and on behalf of the Fee Examiner;

  (c) assist the Fee Examiner with legal issues raised by
      inquiries to and from the Retained Professionals and any
      other professional services provider retained by the Fee
      Examiner;

  (d) where necessary, attend meetings between the Fee
      Examiner and the Retained Professionals;

  (e) assist the Fee Examiner with the preparation of
      preliminary and final reports regarding professional fees
      and expenses;

  (f) assist the Fee Examiner in developing protocols and making
      reports and recommendations; and

  (g) provide other services as the Fee Examiner may seek.

Bernstein Shur will be paid according to its professionals'
customary hourly rates that range from $490-330 for shareholders;
$250-$160 for associates; and $140-$110 for paraprofessionals.
The firm will also be reimbursed for expenses incurred.  The
specific professionals who will be assigned in this engagement
are:

  Name                    Title              Rate per Hour
  ----                    -----              -------------
  Robert J. Keach         Shareholder             $490
  Paul McDonald           Shareholder             $385
  Leonard M. Gulino       Shareholder             $355
  Michael A. Fagone       Shareholder             $340
  David S. Anderson       Shareholder             $340
  Jennifer Rood           Shareholder             $330
  Jessica A. Lewis        Associate               $250
  Halliday Moncure        Associate               $220
  Jeremy Fischer          Associate               $200
  Maire B. Corcoran       Associate               $190
  Ellen M. Palminteri     Associate               $160
  Angela Stewart          Paralegal               $140
  Kathleen Sawyer         Paralegal               $110

Mr. Keach, in his capacity, as shareholder at Bernstein, Shur,
Sawyer & Nelson, P.A., in Portland, Maine, discloses that certain
former or current clients of the firm may be creditors of the
Debtors in matters unrelated to the Debtors.  He further discloses
that he is a co-chair of the American Bankruptcy Institute
Commission to Study the Reform of Chapter 11.  He is a past
president of the ABI and in various capacities at ABI, has worked
with individuals associated with the retained professionals on ABI
business or projects and served on seminar panels with individuals
associated with the retained professionals.  Bernstein Shur and
Mr. Keach have represented clients adverse to clients represented
by certain of the retained professionals.  Bernstein Shur has also
represented the Bank of New York Mellon, a member of the
Creditors' Committee, on matters unrelated to the Debtors.

Despite those disclosures, Mr. Keach insists that Bernstein Shur
is a "disinterested person" as the term is defined in Section
101(14) of the Bankruptcy Code.

                      About American Airlines

AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.

AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.

American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights.  The
combined network fleet numbers more than 900 aircraft.

The Company reported a net loss of $884 million on $18.02 billion
of total operating revenues for the nine months ended Sept. 30,
2011.  AMR recorded a net loss of $471 million in the year 2010, a
net loss of $1.5 billion in 2009, and a net loss of $2.1 billion
in 2008.

AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion
in total assets, $29.55 billion in total liabilities, and a
$4.83 billion stockholders' deficit.

Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors.  Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel.  Rothschild
Inc., is the financial advisor.   Garden City Group Inc. is the
claims and notice agent.

Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings.  Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.

Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).


AMERICAN AIRLINES: Fee Examiner Taps Stuart Maue as Advisor
-----------------------------------------------------------
Robert J. Keach, Esq., the court-appointed fee examiner in
American Airlines' Chapter 11 cases, seeks permission from the
Court to retain Stuart, Maue, Mitchell & James, Ltd., as his
consultant, nunc pro tunc to June 7, 2012.

As the Fee Examiner's consultant, Stuart Maue will:

  (a) assist the Fee Examiner in analyzing the fee applications
      of the retained professionals, to the extent the Fee
      Examiner determines such assistance is appropriate, for
      compliance with the applicable provisions of the
      Bankruptcy Code, the Bankruptcy Rules, the Guidelines, the
      Local Rules and any applicable orders of the Court;

  (b) assist the Fee Examiner with the preparation of periodic
      reports with respect to additional subjects regarding
      professional fees and expenses; and

  (c) provide other services as the Fee Examiner may seek.

Stuart Maue's professionals will be paid according to their
customary hourly rates ranging from $395 for the lead attorney;
$275 to $375 for legal auditors and senior legal auditors; and
$50 for data control personnel.  The Fee Examiner expects that
the bulk of the work done by Stuart Maue will be done by its
lower rate auditors and personnel, and that legal review will be
done largely by the Fee Examiner and professionals employed by
Bernstein, Shur, Sawyer & Nelson, P.A.  Stuart Maue will also be
reimbursed for expenses to be incurred.

James P. Quinn, president and chief operating officer of Stuart,
Maue, Mitchell & James, Ltd., declares that his firm is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.

                      About American Airlines

AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.

AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.

American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights.  The
combined network fleet numbers more than 900 aircraft.

The Company reported a net loss of $884 million on $18.02 billion
of total operating revenues for the nine months ended Sept. 30,
2011.  AMR recorded a net loss of $471 million in the year 2010, a
net loss of $1.5 billion in 2009, and a net loss of $2.1 billion
in 2008.

AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion
in total assets, $29.55 billion in total liabilities, and a
$4.83 billion stockholders' deficit.

Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors.  Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel.  Rothschild
Inc., is the financial advisor.   Garden City Group Inc. is the
claims and notice agent.

Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings.  Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.

Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).


APPLIED DNA: Sells 35.5 Million Common Shares for $1.5 Million
--------------------------------------------------------------
Applied DNA Sciences, Inc., issued and sold 35,576,568 shares of
Common Stock at a purchase price of $0.04336 per share to an
"accredited investor," as defined in regulations promulgated under
the Securities Act of 1933, as amended, for gross proceeds of
$1,542,600.

The issuance of the common stock was completed in reliance upon
the exemption from registration provided for by Section 4(2) of
the Securities Act and by Rule 506 of Regulation D promulgated
under the Securities Act.

On June 6, 2012, a complaint for patent infringement was filed
against the Company by Smartwater, Ltd., in the United States
District Court for the District of Massachusetts in an action
entitled Smartwater, Ltd. v. Applied DNA Sciences, Inc., No. 1:12-
cv-11009-PBS.  The complaint alleges that the Company infringed
one or more claims under two of plaintiff's patents by selling or
offering for sale, manufacturing and using certain of the
Company's products, by inducing others to infringe and by
contributing to infringement by others.  The plaintiff seeks
injunctive relief as well as awards of damages and attorneys'
fees.  The Company has not yet been served with the complaint.
The Company believes that none of its products infringed any
claims under either of plaintiff's patents and moreover notes that
one of plaintiff's patents has expired.  The Company denies the
allegations in the complaint, believes they are without merit and
intends to defend the action vigorously.

                         About Applied DNA

Stony Brook, N.Y.-based Applied DNA Sciences, Inc., is principally
devoted to developing DNA embedded biotechnology security
solutions in the United States.

RBSM LLP, in New York, noted in its report on Applied DNA's fiscal
2011 financial results that the Company has suffered recurring
losses and does not have significant cash or other material
assets, nor does it have an established source of revenues
sufficient to cover its operations, which raises substantial doubt
about its ability to continue as a going concern.

The Company reported a net loss of $10.51 million for the fiscal
year ended Sept. 30, 2011, compared with a net loss of $7.91
million during the prior year.

The Company's balance sheet at March 31, 2012, showed $1.45
million in total assets, $638,232 in total liabilities, all
current, and $813,783 in total stockholders' equity.


APPLIED DNA: To Issue Add'l 250MM Under 2005 Incentive Plan
-----------------------------------------------------------
Applied DNA Sciences, Inc., filed with the U.S. Securities and
Exchange Commission a Form S-8 registering an additional
250,000,000 shares of common stock, par value $0.001 per share,
for future issuance under the Company's 2005 Incentive Stock Plan,
as amended.  The proposed maximum aggregate offering price is
$12.50 million.

Effective as of Jan. 27, 2012, the Company amended the Plan to
increase the number of shares of common stock that may be issued
under the Plan to 350,000,000 shares of common stock from
100,000,000 shares of common stock.

A copy of the filing is available for free at http://is.gd/x2fhzv

                         About Applied DNA

Stony Brook, N.Y.-based Applied DNA Sciences, Inc., is principally
devoted to developing DNA embedded biotechnology security
solutions in the United States.

RBSM LLP, in New York, noted in its report on Applied DNA's fiscal
2011 financial results that the Company has suffered recurring
losses and does not have significant cash or other material
assets, nor does it have an established source of revenues
sufficient to cover its operations, which raises substantial doubt
about its ability to continue as a going concern.

The Company reported a net loss of $10.51 million for the fiscal
year ended Sept. 30, 2011, compared with a net loss of $7.91
million during the prior year.

The Company's balance sheet at March 31, 2012, showed $1.45
million in total assets, $638,232 in total liabilities, all
current, and $813,783 in total stockholders' equity.


ARCAPITA BANK: Court OKs Layoffs for 96, Incentives for 59
----------------------------------------------------------
Lisa Uhlman at Bankruptcy Law360 reports that U.S. Bankruptcy
Judge Sean H. Lane on Tuesday approved a bid by Arcapita Bank BSC
to implement a program under which it will terminate some
employees, give incentives to others and settle claims with
employees over certain prepetition compensation promises it made.

According to Bankruptcy Law360, Judge Lane granted the motion,
allowing the bankrupt Bahraini bank to institute a 96-person
reduction in force, provide retention or incentive bonuses to 59
other employees, and settle potential claims filed by employees
over its prepetition incentive plans.

                       About Arcapita Bank

Arcapita Bank B.S.C., also known as First Islamic Investment Bank
B.S.C., along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March
19, 2012.  The Debtors said they do not have the liquidity
necessary to repay a US$1.1 billion syndicated unsecured facility
when it comes due on March 28, 2012.

Falcon Gas Storage Company, Inc., later filed a Chapter 11
petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012.
Falcon Gas is an indirect wholly owned subsidiary of Arcapita
that previously owned the natural gas storage business NorTex Gas
Storage Company LLC.  In early 2010, Alinda Natural Gas Storage
I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural
Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.)
acquired the stock of NorTex from Falcon Gas for $515 million.
Arcapita guaranteed certain of Falcon Gas' obligations under the
NorTex Purchase Agreement.

The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy
counsel, Linklaters LLP as corporate counsel, Towers & Hamlins
LLP as international counsel on Bahrain matters, Hatim S Zu'bi &
Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild
Inc. and financial advisor, and GCG Inc. as notice and claims
agent.

Milbank, Tweed, Hadley & McCloy LLP represents the Official
Committee of Unsecured Creditors.  Houlihan Lokey Capital, Inc.,
serves as its financial advisor and investment banker.

Founded in 1996, Arcapita is a global manager of Shari'ah-
compliant alternative investments and operates as an investment
bank.  Arcapita is not a domestic bank licensed in the United
States.  Arcapita is headquartered in Bahrain and is regulated
under an Islamic wholesale banking license issued by the Central
Bank of Bahrain.  The Arcapita Group employs 268 people and has
offices in Atlanta, London, Hong Kong and Singapore in addition
to its Bahrain headquarters.  The Arcapita Group's principal
activities include investing on its own account and providing
investment opportunities to third-party investors in conformity
with Islamic Shari'ah rules and principles.

The Arcapita Group has roughly US$7 billion in assets under
management.  On a consolidated basis, the Arcapita Group owns
assets valued at roughly US$3.06 billion and has liabilities of
roughly US$2.55 billion.  The Debtors owe US$96.7 million under
two secured facilities made available by Standard Chartered Bank.

Arcapita explored out-of-court restructuring scenarios but was
unable to achieve 100% lender consent required to effectuate the
terms of an out-of-court restructuring.

Subsequent to the Chapter 11 filing, Arcapita Investment Holdings
Limited, a wholly owned Debtor subsidiary of Arcapita in the
Cayman Islands, issued a summons seeking ancillary relief from
the Grand Court of the Cayman Islands with a view to facilitating
the Chapter 11 cases.  AIHL sought the appointment of Zolfo
Cooper as provisional liquidator.


ARCH COAL: Moody's Lowers CFR/PDR to 'B2'; Outlook Stable
---------------------------------------------------------
Moody's Investors Service has downgraded Arch Coal Inc's corporate
family rating (CFR) and probability of default rating to B2 from
B1. At the same time, Moody's downgraded the ratings on the
company's senior unsecured debt to B3 from B2, and ratings on
secured credit facility to Ba3 from Ba2. The Speculative Grade
Liquidity rating of SGL-3 is unchanged. The outlook is stable.

Moody's took the following rating actions:

Downgrades:

  Issuer: Arch Coal, Inc.

     Probability of Default Rating, Downgraded to B2 from B1

     Corporate Family Rating, Downgraded to B2 from B1

     Senior Secured Bank Credit Facility, Downgraded to Ba3,
     LGD2, 23% from Ba2, LGD2, 21%

     Senior Unsecured Regular Bond/Debenture, Downgraded to B3,
     LGD4, 67% from B2, LGD4, 69%

  Issuer: Arch Coal, Inc.

     Outlook, Changed To Stable From Negative

Ratings Rationale

The downgrade reflects Moody's expectation that Arch's credit
metrics will contract and liquidity will deteriorate in 2012, due
to challenges facing the company's thermal coal business and the
softness in the metallurgical coal market. The company has
recently announced plans to curtail production in Kentucky,
Virginia and West Virginia, reducing Appalachian thermal coal
production by more than 3 million tons annually. Moody's also
expects that sales volume from Arch's Powder River Basin (PRB)
business will decline by 12-16% in 2012 as compared to 2011, while
the margins will contract in the Appalachian business on lower
metallurgical coal prices and higher costs, even as the mix of
sales shifts in favor of met from thermal.

Moody's expects that Arch's Debt/EBITDA, as adjusted, will be in
excess of 8x in 2012, while EBIT will approach break-even. Moody's
also believes that credit metrics will deteriorate further in
2013, as volumes will likely remain suppressed into 2013, while
delivered prices for thermal coal will contract due to lower spot
prices in 2012. Moody's expects metallurgical coal market to
remain soft for the next several months, due to the ongoing
sovereign crisis in Europe and slowing growth rates in steel
production in China. This will limit the extent to which
metallurgical coal business can offset the margin compression
experienced on the thermal side. Moody's expects negative free
cash flows in 2012 and 2013.

The SGL-3 liquidity rating reflects Moody's expectation that over
the next twelve to eighteen months, Arch will have sufficient
liquidity, but that the liquidity position will deteriorate.
Subsequent to the May closing of the $1.4 billion term loan and
subsequent repayment of the existing revolver borrowings and $450
million senior unsecured notes of Arch Western Finance, Arch had
in excess of $500 million in cash and full availability of $600
million under the amended credit facility. Even though credit
facility amendments included covenant relief, Moody's expects that
absent robust recovery in metallurgical coal markets, the headroom
under covenants will be tight in 2013. Moody's expects that
outstanding revolver borrowings will increase through 2013, to
accommodate negative free cash flows over that horizon.

The deterioration in Arch's financial performance is largely
driven by the market conditions and challenges facing the US
thermal coal industry. Unusually warm weather in the US and low
natural gas prices in 2011-2012 led to a collapse in coal prices
across most coal producing regions and production cuts across the
industry, with utilities decreasing their coal-fired generation in
favor of lower-priced gas. For the longer term, sustainable low
natural gas prices, combined with environmental regulations
disadvantaging coal, will slowly continue to erode coal's position
as a raw material for electric generation.

Arch's B2 CFR continues to reflect its geographic and operating
diversity, low level of legacy liabilities, extensive high quality
and low-cost reserves, and access to multiple transportation
options. Factors that constrain the rating include highly levered
capital structure subsequent to the ICG acquisition.

A further downgrade would be considered if Debt/ EBITDA is
expected to remain above 6x on a sustained basis, if free cash
flow is persistently negative, if quarterly earnings continue to
erode, or if there are substantial concerns over the company's
liquidity position or covenant compliance.

While upward momentum to the ratings is limited due to industry
conditions, an upgrade would be considered if Moody's expected
Debt/EBITDA ratio, as adjusted, to trend towards 4.5x and free
cash flows to be positive.

The principal methodology used in rating Arch was the Global
Mining Industry Methodology published in May 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

                           *     *     *

Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Moody's has dongraded Arch Coal's ratings for the
second time since May.  The new Moody's corporate grade of B2 is
one level below the downgrade issued in May by Standard & Poor's.
Moody's now gives Arch's senior unsecured debt a rating of
B3.


BEHRINGER HARVARD: 2 Funds Struggle to Make Loan Payments
---------------------------------------------------------
Bruce Kelly at InvestmentNews reports that Behringer Harvard
Holdings LLC is struggling to make payments on loans in two of its
offerings -- and is losing real estate assets as a result.

According to the report, after months of failed negotiations over
$48.3 million of debt, the non-traded Behringer Harvard
Opportunity REIT I Inc. this month had several properties go into
bankruptcy protection.  The report also relates the Behringer
Harvard Short-Term Opportunity Fund I LP this month entered a
"deed in lieu of foreclosure agreement" that transferred
properties to the lender.  The Behringer Harvard fund had owed
$20.2 million on those properties.

The report relates the two real estate offerings have been in
decline for some time.  Both saw their estimated valuations
decline dramatically over the last year:

     -- Behringer Harvard Opportunity REIT I saw its estimated
        value decline 46% at the end of 2011 to $4.12 a share,
        from $7.66 a year earlier.

     -- Behringer Harvard Short-Term Opportunity Fund I LP, which
        had about $130 million in total assets, saw its valuation
        drop to 40 cents a share, down drastically from $6.48 a
        share as of Dec. 31, 2010.

The report also notes:

     -- Opportunity REIT I, with $524.4 million in total assets,
        is sitting on an additional $68.4 million in debt that is
        maturing this year.

     -- the move to shed real estate cuts the total assets of the
        Short-Term Opportunity Fund I essentially in half.  On a
        pro forma basis and taking into account the recent loss of
        real estate, the fund had $64.5 million in total assets --
        compared with $112.5 million in total assets at the end of
        March, according to a filing with the Securities and
        Exchange Commission.


BERNARD L. MADOFF: Wins Appeal Over $1.025BB Tremont Settlement
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Bernard L. Madoff Investment Securities Inc. won an
appeal June 27 that could free $1.025 billion for distribution to
creditors within four months, if there's no further appeal.

The report recounts that the Madoff trustee sued Tremont Group
Holdings Inc., Oppenheimer Acquisition Corp., Massachusetts Mutual
Life Insurance Co. and affiliates for $2.1 billion in funds
received directly from the Madoff firm.  Oppenheimer owns the
Tremont hedge fund.

The Bloomberg report relates that the settlement authorized the
trustee to recover $1.025 billion cash from the second-largest
group of feeder funds that funneled money into the Madoff Ponzi
scheme.  In return for the $1.025 billion payment into escrow, the
foreign and domestic investment funds will receive about $3
billion in approved customer claims.  The settlement was
structured so distributions on the funds' claims will be paid
directly to the funds' customers.

Investors in other Tremont funds, the report relates, appealed the
settlement.  Those funds were so-called net winners which managed
to take more out of the Madoff firm than they invested.
Consequently, they don't have customer claims against the Madoff
firm under a ruling by the U.S. Court of Appeals upheld this week
by the U.S. Supreme Court.  In the appeal decided Wednesday, they
wanted the settlement set aside so they too could have claims
against the Madoff firm.

According to the report, Madoff trustee Irving Picard, Tremont and
Mass Mutual all joined together requesting dismissal of the
appeal. U.S. District Judge George B. Daniels agreed and threw out
the appeal Tuesday.  Judge Daniels said in his 5-page opinion that
the other funds weren't customers, weren't even creditors of the
Madoff firm, weren't aggrieved by the settlement and thus lacked
standing, or the right to appeal.  The funds on the losing side
have 30 days to appeal.  If they don't seek further review in the
U.S. Court of Appeals, the settlement agreement requires holding
the $1.025 billion in escrow for an additional 90 days before it
can be distributed to customers.

Mr. Rochelle notes that coupled with a decision by the U.S.
Supreme Court this week not to allow an appeal on the method of
claim calculation, the June 27 victory means Madoff customers are
in for significant distributions in upcoming months.  Appeals have
been preventing Mr. Picard from distributing most of about $11
billion collected for the benefit of customers.  About $7.2
billion is being held up because other customers have a right of
appeal until July 16 from court approval of a forfeiture by the
late Jeffry M. Picower.  Mr. Picard said he will make
distributions in the "near future." He didn't say exactly when or
how much.

The Tremont appeal is Picard v. Tremont Group Holdings Inc.,
11-cv-07330, U.S. District 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.


BERNARD L. MADOFF: Younger Brother to Enter Guilty Plea
-------------------------------------------------------
Chad Bray, writing for The Wall Street Journal, reports that
Bernard Madoff's younger brother, Peter, is expected to plead
guilty to criminal charges and has agreed to go to prison for 10
years, in the first admission of wrongdoing by a family member in
a multibillion-dollar investment business that turned out to be
"just one big lie."

According to WSJ, Peter Madoff, 66, is expected to plead guilty to
two charges at a hearing Friday in Manhattan federal court,
including falsifying the records of an investment adviser and a
broad conspiracy count to commit securities fraud and other
crimes, according to a letter sent to U.S. District Judge Laura
Taylor Swain and filed in court on Wednesday.

WSJ says Peter Madoff, the firm's chief compliance officer,
however, isn't expected to admit to knowing about the fraud
itself.  Instead, he is expected to admit to conduct that enabled
the fraud to continue, even if he didn't know new investor money
was being used to pay older investors or that no trading was being
conducted at the investment firm.

According to the report, as part of his plea, Peter Madoff has
agreed to forfeit about $143.1 billion, a figure that represents
essentially all the money that went into and out of the firm
during the time prosecutors believe he was culpable.  The figure
exceeds his assets, all of which he will have to give up to the
government.

                     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.


BLITZ USA: To Shut Down Operations by End of July
-------------------------------------------------
Rachel Feintzeig at Dow Jones' DBR Small Cap reports that Blitz
USA Inc. is abandoning its efforts to reorganize and instead is
vowing to shut down operations by the end of July.

                          About Blitz USA

Blitz U.S.A. Inc., is a Miami, Oklahoma-based manufacturer of
plastic gasoline cans.  The company, controlled by Kinderhook
Capital Fund II LP, filed for bankruptcy protection to stanch a
hemorrhage resulting from 36 product-liability lawsuits.

Parent Blitz Acquisition Holdings, Inc., and its affiliates filed
for Chapter 11 protection (Bankr. D. Del. Case Nos. 11-13602 thru
11-13607) on Nov. 9, 2011.  The Hon. Peter J. Walsh presides over
the case.

Blitz USA disclosed $36,194,434 in assets and $41,428,577 in
liabilities in its schedules.

Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
represents the Debtors in their restructuring efforts.  The
Debtors tapped Zolfo Cooper, LLC, as restructuring advisor; and
Kurtzman Carson Consultants LLC serves as notice and claims agent.
Lowenstein Sandler PC from Roseland, New Jersey, represents the
Official Committee of Unsecured Creditors.

The Chapter 11 case is financed with a $5 million secured loan
from Bank of Oklahoma.  Bank of Oklahoma, as DIP agent, is
represented by Samuel S. Ory, Esq., at Frederic Dorwart Lawyers in
Tulsa.

In April 2012, Hopkins Manufacturing Corp. acquired the assets of
Blitz USA's unit, F3 Brands LLC, a major manufacturer of oil
drains, drain pans, lifting aids and automotive ramps.  Blitz USA
said in court documents the sale netted the Debtors $14.6 million,
which was applied against secured debt.


BLUE RAVEN: To Be Sold July 25 Without Formal Auction
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Blue Raven Technology Inc. will return to bankruptcy
court in Boston on July 25 to seek authority to sell the business
for $1.4 million to private-equity investor Leading Ridge Capital
Partners LLC from Rockville, Maryland.  Although there won't be a
formal auction before the sale-approval hearing, other prospective
buyers are invited to make offers.  If Leading Ridge loses out,
the bankruptcy judge said he will award a $50,000 breakup fee.

                         About Blue Raven

Blue Raven Technology, Inc., filed a Chapter 11 petition (Bankr.
D. Mass. Case No. 12-14693) on May 30, 2012.  Blue Raven is a
provider of parts and repair services for consumer electronics and
computers.  The Company had $17.7 million of revenue in 2011, an
18% decline from the year before.  The company blamed its problems
on the bankruptcies of electronics retailers that had been major
customers.

David B. Madoff, Esq., at Madoff & Khoury LLP, in Foxboro, serves
as counsel.

The Debtor disclosed $2.143 million in assets and $8.284 million
in liabilities as of the Chapter 11 filing.


BROOKSTONE INC: S&P Withdraws 'B-' CCR on Lack of Market Interest
-----------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its unsolicited 'B-'
corporate credit rating on Merrimarck, N.H.-based Brookstone Inc.
due to lack of market interest.

"At the same time, we withdrew our unsolicited 'CCC+' issue-level
and '5' recovery ratings on Brookstone Co. Inc.'s $125.6 million
13% second-lien notes due Oct. 15, 2014. The notes are guaranteed
by Brookstone," S&P said.


BUFFETS INC: Second Amended Chapter 11 Plan Confirmed
-----------------------------------------------------
BankruptcyData.com reports that Buffets Restaurants Holdings filed
with the U.S. Bankruptcy Court a Second Amended Chapter 11 Plan
and Second and Third Amended Plan Supplements. The Court
subsequently entered an order confirming the Plan, under which
administrative claims, priority tax claims, D.I.P. financing,
claims and other priority claims are expected to receive a 100%
cash payment. General unsecured claims are expected an 8 to 9%
recovery rate.

                         About Buffets Inc.

Buffets Inc., the nation's largest steak-buffet restaurant
company, operates 494 restaurants in 38 states, comprised of 483
steak-buffet restaurants and 11 Tahoe Joe's Famous Steakhouse(R)
restaurants, and franchises 3 steak-buffet restaurants in two
states. The restaurants are principally operated under the Old
Country Buffet(R), HomeTown(R) Buffet, Ryan's(R) and Fire
Mountain(R) brands.  Buffets employs 28,000 team members and
serves 140 million customers annually.

Buffets Inc. and all of its subsidiaries filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10237) on Jan. 18,
2012, after it reached a restructuring support agreement with 83%
of its lenders to eliminate virtually all of the Company's roughly
$245 million of outstanding debt.  In its schedules Buffets Inc.
disclosed $384,810,974 in assets and $353,498,404 in liabilities.
The Debtors are seeking to reject leases for 83 underperforming
restaurants.

Buffets had 626 restaurants when it began its prior bankruptcy
case (Bankr. D. Del. Case Nos. 08-10141 to 08-10158).  It emerged
from bankruptcy in April 2009.

Higher gasoline and energy costs, along with a decline in guest
count, have hampered the Debtors' ability to service their long-
term debt and caused a liquidity strain, forcing the Company to
return to Chapter 11 bankruptcy.

In the new Chapter 11 case, Buffets Inc.'s legal advisors are
Paul, Weiss, Rifkind, Wharton & Garrison LLP and Young, Conaway,
Stargatt & Taylor, LLP.  The Company's financial advisor is
Moelis, Inc.  Epiq Bankruptcy Solutions LLC serves as claims,
noticing and balloting agent.

An ad hoc committee of secured lenders is represented by Willkie
Far & Gallagher LLP and Blank Rome LLP as counsel and Conway, Del
Genio, Gries & Co. as financial advisors.  Credit Suisse, as DIP
Agent and Prepetition First Lien Agent, is represented by Skadden
Arps Slate Meagher & Flom as counsel.

The U.S. Trustee has appointed a 5-member Official Committee of
Unsecured Creditors in the Debtors' cases.

In March 2012, Buffets Inc. received court approval for an
incentive bonus program that may pay as much as $2.3 million to
executives if cash flow targets are met.  There was an April 30
hearing schedule on another program to pay bonuses for a
successful sale of the business that could cost $2.7 million.

In April 2012, Buffets Inc. filed an amended bankruptcy exit plan
that proposes to pay $4 million to a pool of unsecured creditors
who are owed more than $44 million.  Unsecured creditors are
expected to recover about 9% of their claims.


BUFFETS INC: Shutters Ryan's Grill Outlet in Houma, La.
-------------------------------------------------------
Tri-Parish Times reports that the Ryan's Grill and Buffet in
Houma, La., closed last week as part of the Chapter 11 bankruptcy
of Buffets Inc.  According to the report, the only local public
notice was a sign posted on the building that announced the
restaurant at 1520 Martin Luther King Blvd. was no longer in
business.  Of the nine Louisiana Ryan's locations, the only other
to close was the eatery in Deridder, although the chain did close
other locations throughout the south, including some located in
Virginia, Tennessee and Georgia.

                        About Buffets Inc.

Buffets Inc., the nation's largest steak-buffet restaurant
company, operates 494 restaurants in 38 states, comprised of 483
steak-buffet restaurants and 11 Tahoe Joe's Famous Steakhouse(R)
restaurants, and franchises 3 steak-buffet restaurants in two
states. The restaurants are principally operated under the Old
Country Buffet(R), HomeTown(R) Buffet, Ryan's(R) and Fire
Mountain(R) brands.  Buffets employs 28,000 team members and
serves 140 million customers annually.

Buffets Inc. and all of its subsidiaries filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10237) on Jan. 18,
2012, after it reached a restructuring support agreement with 83%
of its lenders to eliminate virtually all of the Company's roughly
$245 million of outstanding debt.  In its schedules Buffets Inc.
disclosed $384,810,974 in assets and $353,498,404 in liabilities.
The Debtors are seeking to reject leases for 83 underperforming
restaurants.

Buffets had 626 restaurants when it began its prior bankruptcy
case (Bankr. D. Del. Case Nos. 08-10141 to 08-10158).  It emerged
from bankruptcy in April 2009.

Higher gasoline and energy costs, along with a decline in guest
count, have hampered the Debtors' ability to service their long-
term debt and caused a liquidity strain, forcing the Company to
return to Chapter 11 bankruptcy.

In the new Chapter 11 case, Buffets Inc.'s legal advisors are
Paul, Weiss, Rifkind, Wharton & Garrison LLP and Young, Conaway,
Stargatt & Taylor, LLP.  The Company's financial advisor is
Moelis, Inc.  Epiq Bankruptcy Solutions LLC serves as claims,
noticing and balloting agent.

An ad hoc committee of secured lenders is represented by Willkie
Far & Gallagher LLP and Blank Rome LLP as counsel and Conway, Del
Genio, Gries & Co. as financial advisors.  Credit Suisse, as DIP
Agent and Prepetition First Lien Agent, is represented by Skadden
Arps Slate Meagher & Flom as counsel.

The U.S. Trustee has appointed a 5-member Official Committee of
Unsecured Creditors in the Debtors' cases.

Buffets Inc. revealed in January that its lenders agreed to
convert $245 million in senior secured debt to a 100% equity stake
in the reorganized company.  In April 2012, Buffets Inc. filed an
amended bankruptcy exit plan that proposes to pay $4 million to a
pool of unsecured creditors who are owed more than $44 million.
Unsecured creditors are expected to recover about 9% of their
claims.


CAJUN ELECTRIC: 5th Cir. Clears SWEPCO of Reimbursement Obligation
------------------------------------------------------------------
The U.S. Court of Appeals for the Fifth Circuit affirmed, in part,
and reverse, in part, a bankruptcy court's ruling, affirmed by the
district court, that held Southwestern Electric Power Company
liable for legal expenses incurred by the Committee of Certain
Members appointed in the Chapter 11 bankruptcy case of Cajun
Electric Power Cooperative.  The Fifth Circuit affirmed the
bankruptcy court's dismissal of SWEPCO's counterclaim and reversed
its judgment that the CCM is entitled to recover under a 1997
agreement.

In December 1994, Cajun Electric, a Louisiana electrical
cooperative comprised of 12 member cooperatives, filed for
bankruptcy protection under Chapter 11.  Shortly thereafter, 10 of
the 12 member cooperatives formed an informal committee known as
the Committee of Certain Members for purposes of the bankruptcy
case.  The CCM worked with SWEPCO to submit a joint plan of
reorganization.  Under the proposed plan, SWEPCO would acquire
Cajun Electric's assets and the CCM members would enter into long-
term agreements to purchase electricity from SWEPCO.

In January 1997, during the plan confirmation process, three of
the CCM members decided to withdraw from the CCM and support
another reorganization plan.  The withdrawing members moved the
bankruptcy court to disqualify the CCM's counsel based on
conflicts of interest and the court granted the members' motion.
Soon after, SWEPCO gave the CCM, then comprising seven members,
$1 million to help with the additional costs necessary to retain
new counsel.

On April 17, 1997, SWEPCO and the CCM signed the Term Sheet of
Members and SWEPCO whereby SWEPCO agreed to reimburse additional
expenses incurred by the CCM during the bankruptcy proceedings.

By February 1999, two of the four proposed reorganization plans
had been withdrawn, leaving only the SWEPCO/CCM plan and a plan
supported by Cajun Electric's Chapter 11 trustee still in the
running for confirmation.  On Feb. 11, 1999, the bankruptcy court
denied confirmation of both remaining plans, but invited the
trustee and the SWEPCO/CCM group to submit revised plans, which
they did on April 19, 1999.

On May 14, 1999, SWEPCO and the CCM filed a supplemental
disclosure statement pursuant to 11 U.S.C. Sec. 1125(b) providing
information about their revised plan.  The disclosure statement
included a section titled "Reimbursement of Costs and Fees," which
purported to describe the "only agreements as to reimbursement of
fees and expenses" between SWEPCO and the CCM.  The reimbursement
agreements in the supplemental disclosure were similar to those in
the 97 Agreement, but included changes in key language and
provisions not present in the 97 Agreement.

The plan confirmation process continued until Aug. 18, 1999, when
the district court ordered the parties to appear at the federal
courthouse in Baton Rouge, Louisiana, and participate in
settlement negotiations.  The parties appeared on Aug. 25, 1999,
and reached a settlement that same day.

Under the settlement agreement, SWEPCO and the CCM would withdraw
their plan and the plan supported by Cajun Electric's Chapter 11
trustee -- by then known as the "Creditors' Plan" -- would be
confirmed.  The settlement agreement also provided for partial
repayment of the expenses SWEPCO and the CCM incurred during the
bankruptcy proceedings.  SWEPCO was to receive a $7.5 million
administrative expense claim to be paid by the bankruptcy estate
and the CCM was to receive $9 million to be paid by proponents of
the winning plan.  The settlement agreement made no mention of the
reimbursement agreements described in the 97 Agreement or the
supplemental disclosure.

The settlement agreement was approved by the district court and
was incorporated into the winning plan, which was confirmed by the
bankruptcy court on Oct. 14, 1999.  On Feb. 20, 2000, the CCM
filed an application for $9 million in expense reimbursement.
The application was approved and the CCM eventually received the
$9 million.

On June 19, 2001, roughly 20 months after the winning plan was
confirmed, the CCM filed suit against SWEPCO in Louisiana state
court asserting a breach of contract claim.  The CCM alleged that
the 97 Agreement required SWEPCO to repay the CCM for legal
expenses incurred during the Cajun Electric bankruptcy case and
that SWEPCO had failed to do so.  SWEPCO removed the case to the
bankruptcy court pursuant to 28 U.S.C. Sec. 1452 and filed an
answer and counterclaim.

In its counterclaim, SWEPCO alleged that it was entitled to
repayment of the $1 million it gave the CCM under a refund
provision set forth in the supplemental disclosure.  The parties
filed cross motions for summary judgment.

The bankruptcy court granted the CCM's motion for summary
judgment, denied SWEPCO's motion for summary judgment, and
dismissed SWEPCO's counterclaim.  The court ruled that SWEPCO owed
the CCM $2,610,778.63 pursuant to the 97 Agreement and entered a
judgment for that amount, plus interest, on Feb. 2, 2006.

SWEPCO filed a notice of appeal in the district court on Feb. 10,
2006.  On Sept. 26, 2011, the district court entered an order
affirming the bankruptcy court's judgment for the reasons provided
by the bankruptcy court.  SWEPCO appealed to the Fifth Circuit.

According to the Fifth Circuit, SWEPCO's reimbursement obligation
was immediately enforceable beginning Jan. 1, 1997, but the CCM,
for whatever reason, chose not to seek payment until after the
SWEPCO/CCM plan was denied on Feb. 11, 1999, and another plan was
confirmed on Oct. 14, 1999.  The Fifth Circuit said both of these
events were sufficient to extinguish SWEPCO's liability under the
plain language of Section VI of the 97 Agreement.  It was the
CCM's own failure to assert its right to reimbursement which
permitted SWEPCO to avoid liability.

The case is SOUTHWESTERN ELECTRIC POWER COMPANY (SWEPCO),
Appellant, v. COMMITTEE OF CERTAIN MEMBERS OF CAJUN ELECTRIC,
Appellee, No. 11-31022 (5th Cir.).  A copy of the Fifth Circuit's
per curiam decision dated June 25, 2012, is available at
http://is.gd/M4Edy7from Leagle.com.


CAMBRIDGE HEART: Five Directors Elected at Annual Meeting
---------------------------------------------------------
Cambridge Heart, Inc., held its annual meeting of stockholders on
June 25, 2012.  At the annual meeting, the stockholders elected
Roderick de Greef, Ali Haghighi-Mood, John McGuire, Paul
McCormick, and Jeffrey Wiggins to the board of directors to serve
until the next annual meeting of stockholders and the election of
their successors.  The amendment to the Certificate of
Incorporation increasing the number of shares of common stock
authorized for issuance from 250,000,000 to 500,000,000 was
approved.  The stockholders ratified the appointment of McGladrey
LLP as the Company's independent registered public accounting firm
for the fiscal year ending Dec. 31, 2012.

As of June 25, 2012, 100,112,960 shares of the Company's common
stock were outstanding.  On an as-converted basis, the Company has
124,659,416 shares of common stock issued and outstanding,
including 100,112,960 shares of common stock issued, 4,180,602
shares issuable upon conversion of the Series C-1 Convertible
Preferred Stock and 20,365,854 shares issuable upon conversion of
the Series D Convertible Preferred Stock.

                       About Cambridge Heart

Tewksbury, Mass.-based Cambridge Heart, Inc., is engaged in the
research, development and commercialization of products for the
non-invasive diagnosis of cardiac disease.

In its report on the financial statements for the year ended
Dec. 31, 2011, McGladrey & Pullen, LLP, in Boston, Massachusetts,
expressed substantial doubt about Cambridge Heart's ability to
continue as a going concern.  The independent auditors noted that
of the Company's recurring losses, inability to generate positive
cash flows from operations, and liquidity uncertainties from
operations.

The Company reported a net loss of $5.40 million in 2011, compared
with a net loss of $5.17 million in 2010.

The Company's balance sheet at March 31, 2012, showed
$2.54 million in total assets, $4.68 million in total liabilities,
$12.74 million in convertible preferred stock, and a
$14.89 million total stockholders' deficit.


CAPE JASMINE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Cape Jasmine Court Trust
        c/o Resources Group LLC
        900 Las Vegas Blvd S. #810
        Las Vegas, NV 89107

Bankruptcy Case No.: 12-17498

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       District of Nevada (Las Vegas)

Judge: Bruce A. Markell

Debtor's Counsel: Ryan Alexander, Esq.
                  LAW OFFICES OF RYAN ALEXANDER
                  200 E. Charleston Blvd
                  Las Vegas, NV 89104
                  Tel: (702) 222-3476
                  Fax: (702) 252-3476
                  E-mail: ryan@thefirm-lv.com

Scheduled Assets: $1,080,000

Scheduled Liabilities: $2,959,037

A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/nvb12-17498.pdf

The petition was signed by Eddie Haddad, registered agent.

Affiliates that filed separate Chapter 11 petitions:

                                                 Petition
   Debtor                              Case No.     Date
   ------                              --------     ----
4208 Rollingstone Dr Trust             12-12363   03/01/12
Bourne Valley Court Trust              12-16387   05/31/12
Villa Vecchio Court Trust              12-15254   05/02/12


CCGI HOLDING: Moody's Withdraws 'B3' CFR on Debt Repayment
----------------------------------------------------------
Moody's Investors Service has withdrawn all ratings assigned to
CCGI Holding Corporation and its subsidiary Covad Communications
Group, Inc. as a result of the company's notification that it has
repaid existing debt with a new, unrated facility, warranting the
rating withdrawal. Since Moody's does not rate any of CCGI's new
debt, Moody's has also withdrawn the company's Corporate Family
Rating and Probability of Default Rating.

Issuer: CCGI Holding Corporation

  Outlook Actions:

    Outlook, Changed To Rating Withdrawn From Stable

  Withdrawals:

    Probability of Default Rating, Withdrawn, previously rated B3

    Corporate Family Rating, Withdrawn, previously rated B3

Issuer: Covad Communications Group, Inc.

  Outlook Actions:

    Outlook, Changed To Rating Withdrawn From Stable

  Withdrawals:

    US$165M Senior Secured Bank Credit Facility, Withdrawn,
    previously rated B2

    US$25M Senior Secured Bank Credit Facility, Withdrawn,
    previously rated B2

    US$165M Senior Secured Bank Credit Facility, Withdrawn,
    previously rated a range of LGD3, 34 %

    US$25M Senior Secured Bank Credit Facility, Withdrawn,
    previously rated a range of LGD3, 34 %

Ratings Rationale

The principal methodology used in rating CCGI Holding Corporation
was the Global Telecommunications 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.

San Jose, CA, based CCGI Holding Corporation is a competitive
telecommunications provider that was formed via a merger of Covad
Communications Group, Inc., MegaPath, Inc., and Speakeasy
Broadband Services LLP in September 2010. The combined company is
a national broadband service provider of high-speed internet,
voice, security and managed IP/MPLS network, which is currently
available in 44 states and 235 major metropolitan areas.


CERIDIAN CORP: S&P Rates $720MM Senior Notes & Term Loan 'B-'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned Minneapolis-based
Ceridian Corp.'s proposed $720 million senior notes due 2019 and
extended term loan B its 'B-' issue-level rating and '3' recovery
rating. "The '3' recovery rating indicates our expectation of
meaningful (50%-70%) recovery in the event of a payment default
by the borrower," S&P said.

The company is issuing the notes in conjunction with an amend-and-
extend transaction of part of its currently outstanding bank debt.

"Our existing ratings on Ceridian, including our 'B-' corporate
credit rating, remain unchanged. The outlook is stable," S&P said.

"The issue-level rating on Ceridian's senior secured debt is 'B-'
(the same as the corporate credit rating) and the recovery rating
is '3', indicating the expectation for meaningful (50%-70%)
recovery in the event of a payment default. The rating on the
company's unsecured debt issue is 'CCC' (two notches lower than
the corporate credit rating) and the recovery rating is '6',
indicating the expectation for negligible (0%-10%) recovery in the
event of a payment default," S&P said.

"The ratings on Ceridian reflect a very aggressive capital
structure with an unfavorable maturity schedule," said Standard &
Poor's credit analyst Jacobs Schlanger, "as well as the effects of
a weak economy on the company's revenue and operating earnings.
The proposed transactions will ease the impact of the nearer term
maturities as well as provide some covenant relief. In addition,
significant recurring revenue streams and defensible market
positions partially offset the broader economic factors."

"Our stable rating outlook reflects Ceridian's modest near-term
debt maturities, the eased leverage covenant, which provides
sufficient headroom over the near term, and the company's
significant base of recurring revenues. We expect revenue to
slowly grow in conjunction with the economic recovery,
introduction of new offerings, and expansion into new markets.
Liquidity is ample enough to handle near-term maturities. However,
the highly leveraged capital structure limits a possible upgrade,"
S&P said.

"Although the company has largely addressed the 2014 maturity
wall, we could lower our ratings as the company approaches the
2015 maturity wall and there are no plans in place to restructure
or repay the debt, or if covenant headroom drops to less than
10%," S&P said.


CINRAM INT'L: Moody's Lowers CFR/PDR to 'C/D' Over CCAA Filing
--------------------------------------------------------------
Moody's Investors Service downgraded the probability of default
rating (PDR) for Cinram International Inc. to D from Caa3 as a
result of the company and certain affiliates filing petitions for
reorganization under the Companies' Creditors Arrangements Act
(CCAA). The company's corporate family rating, senior secured
first-out credit facility rating and senior secured second-out
credit facilities' ratings were downgraded to C, Caa3 and C,
respectively. Cinram's speculative grade liquidity rating remains
unchanged at SGL-4. The rating outlook remains unchanged at
negative. Moody's will withdraw all of the these ratings shortly
(refer to Moody's ratings withdrawal policy on moodys.com).

Rating actions:

  Issuer: Cinram International Inc.

    Corporate Family Rating, downgraded to C from Caa3

    Probability of Default Rating, downgraded to D from Caa3

    Senior Secured First-out Revolving Facility downgraded to
    Caa3 (LGD3, 31%) from B2 (LGD2, 10%)

    Senior Secured Second-out Revolving Facility downgraded to C
    (LGD5, 74%) from Caa3 (LGD3, 45%)

    Senior Secured Bank Credit Facility downgraded to C (LGD5,
    74%) from Caa3 (LGD3, 45%)

    Speculative Grade Rating, affirmed at SGL-4 (poor)

  Outlook remains Negative

Ratings Rationale

The downgrade follows the company and certain of affiliates filing
petitions for reorganization under the Companies' Creditors
Arrangements Act (CCAA).

The principal methodology used in rating Cinram International was
the Global Manufacturing 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.


CHOICE HOTELS: S&P Cuts Rating on $250-Mil. Senior Notes to 'BB'
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BBB' issue-level
rating to Choice Hotels International Inc.'s proposed $350 million
senior secured credit facility due 2016, which consists of a $200
million revolver and a $150 million term loan. "At the same time,
we assigned this facility our '1' recovery rating, reflecting our
expectation for very high recovery (90% to 100%) for lenders in
the event of a payment default. Additionally, we lowered our
issue-level rating on Choice's $250 million senior unsecured notes
due 2020 to 'BB' from 'BB+' and removed the rating from
CreditWatch with negative implications. We also revised our
recovery rating on these notes to '5' from '4', reflecting the
finalization of financing terms for Choice's planned dividend
recapitalization and our expectation for modest recovery (10% to
30%) for lenders in the event of a payment default. The 'BB'
issue-level and '5' recovery rating on the company's $400 million
5.75% senior unsecured notes due 2022 are affirmed," S&P said.

Ratings List

Choice Hotels International Inc.

Corporate Credit Rating                 BB+/Stable/--

Rating Assigned
Proposed $200 mil sr sec notes due 2016 BBB
Recovery rating                        1
Proposed $150 term loan BBB
Recovery rating                        1

Rating Affirmed
$400 mil. 5.75% sr. unsec nts due 2022  BB

Downgraded; CreditWatch Action
                                        To     From
Senior Unsecured
  US$250 mil 5.70% sr nts due 2020      BB     BB+/Watch Neg
   Recovery Rating                      5      4


CORNERSTONE BANCSHARES: Appoints Nathaniel Hughes as CEO
--------------------------------------------------------
Cornerstone Bancshares, Inc., appointed Nathaniel F. Hughes as
Chief Executive Officer; J. Robert Vercoe, Jr., as Chief Credit
Officer; and John H. Coxwell, Sr., as Executive Officer.

Mr. Coxwell brings a 30-plus-year career as a Certified Public
Accountant and financial institution specialist to his new
position.  His extensive CPA experience includes managerial
positions with Deloitte & Touche and, most recently, 13 years as
Managing Partner of Hazlett, Lewis & Bieter, PLLC.  In his new
role with Cornerstone, he will be responsible for working in
conjunction with President Frank Hughes to oversee and manage all
bank operations.

"We are extremely pleased to welcome John aboard," said Mr.
Hughes.  "He brings a wealth of expertise and in-depth knowledge
that will make him an outstanding addition to the management team
and a tremendous asset to Cornerstone."

                   About Cornerstone Bancshares

Chattanooga, Tenn.-based Cornerstone Bancshares, Inc. is a bank
holding company.  Its wholly-owned subsidiary, Cornerstone
Community Bank, is a Tennessee-chartered commercial bank with five
full-service banking offices located in Hamilton County,
Tennessee.

Cornerstone reported net income of $1.03 million in 2011, compared
with a net loss of $4.70 million in 2010.

The Company's balance sheet at March 31, 2012, showed $417.47
million in total assets, $381.58 million in total liabilities and
$35.88 million in total stockholders' equity.

Cornerstone said in its 2011 annual report that as of Dec. 31,
2011, the Company had one loan, currently being serviced by
Midland Loan Services for the FDIC, which totaled approximately $3
million.  The loan contains certain compliance covenants which
include stated minimum or maximum target amounts for Cornerstone's
capital levels, the Bank's capital levels, nonperforming asset
levels at the Bank and the ability of Cornerstone to meet the
required debt service coverage ratio, which is computed on the
four most recent consecutive fiscal quarters.  Due to the level of
nonperforming assets of the Bank and not currently meeting the
required debt service coverage ratio, Cornerstone was not in
compliance with these two covenants at Dec. 31, 2011.  However,
Cornerstone had previously obtained waivers through Dec. 31, 2011.
During March 2012, Cornerstone obtained from the FDIC a waiver of
the covenant compliance requirements through Dec. 31, 2012,
granted that all payments are made in accordance with the
aforementioned repayment schedule.  However, if the Company is
unable to comply with those covenants or obtain an additional
waiver from the lender for violations that occur after Dec. 31,
2012, if any, the lender may declare the loan in default and take
possession of the Bank's common stock.  If this event were to
occur, Cornerstone's assets and operations would be substantially
reduced and therefore its ability to continue as a going concern
would be in substantial doubt.

                           Consent Order

The Company disclosed in the Form 10-Q for the quarter ended
June 30, 2010, that following the issuance of a written report by
the Federal Deposit Insurance Corporation and the Tennessee
Department of Financial Institutions concerning their joint
examination of Cornerstone Community Bank in October 2009, the
Bank entered a consent order with the FDIC on April 2, 2010, and a
written agreement with the TDFI on April 8, 2010, each concerning
areas of the Bank's operations identified in the report as
warranting improvement and presenting substantially similar plans
for making those improvements.

The consent order and written agreement, which the Company
collectively refers to as the "Action Plans", convey specific
actions needed to address certain findings from the joint
examination and to address the Company's current financial
condition.  The Action Plans contain a list of strict requirements
ranging from a capital directive, which requires the Company to
achieve and maintain minimum regulatory capital levels in excess
of the statutory minimums to be well-capitalized, to developing a
liquidity risk management and contingency funding plan, in
connection with which the Company will be subject to limitations
on the maximum interest rates it  can pay on deposit accounts.
The Action Plans also contain restrictions on future extensions of
credit and requires the development of various programs and
procedures to improve the Company's asset quality as well as
routine reporting on its  progress toward compliance with the
Action Plans to the Board of Directors, the FDIC and the TDFI.

As of April 2, 2010, the date of the Action Plans, the Bank was
deemed to be "adequately capitalized."


CRYOPORT INC: Incurs $7.8 Million Net Loss in Fiscal 2012
---------------------------------------------------------
Cryoport, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$7.83 million on $555,637 of revenue for the year ended March 31,
2012, compared with a net loss of $6.15 million on $475,504 of
revenue during the prior fiscal year.

The Company's balance sheet at March 31, 2012, showed $6.21
million in total assets, $2.48 million in total liabilities and
$3.72 million in total stockholders' equity.

KMJ Corbin & Company LLP, in Costa Mesa, California, issued a
"going concern" qualification on the consolidated financial
statements for the fiscal year ended March 31, 2012.  The
independent auditors noted that the Company has incurred recurring
operating losses and has had negative cash flows from operations
since inception.  Although the Company has working capital of
$4,024,120 and cash & cash equivalents of $4,617,535 at March 31,
2012, management has estimated that cash on hand, which include
proceeds from the offering received in the fourth quarter of
fiscal 2012, will only be sufficient to allow the Company to
continue its operations only into the fourth quarter of fiscal
2013.  These matters raise substantial doubt about the Company's
ability to continue as a going concern.

A copy  of the Form 10-K is available for free at:

                        http://is.gd/GJlayT

                         About CryoPort Inc.

Headquartered in Lake Forest, Calif., CryoPort, Inc. (OTC BB:
CYRXD) -- http://www.cryoport.com/-- provides innovative cold
chain frozen shipping system dedicated to providing superior,
affordable cryogenic shipping solutions that ensure the safety,
status and temperature of high value, temperature sensitive
materials.  The Company has developed a line of cost-effective
reusable cryogenic transport containers capable of transporting
biological, environmental and other temperature sensitive
materials at temperatures below 0-degree Celsius.


D.R. HORTON: Strong Liquidity Cues Fitch to Affirm Low-B Ratings
----------------------------------------------------------------
Fitch Ratings has affirmed its ratings for D.R. Horton, Inc.
(NYSE: DHI), including the company's long-term IDR at 'BB'.  Fitch
has also revised DHI's Rating Outlook to Positive from Stable.

The ratings for DHI reflect the company's strong liquidity
position, the successful execution of its business model,
geographic and product line diversity and steady capital
structure.  Fitch expects better prospects for the housing
industry this year.  That being the case, there are still
challenges facing the housing market that are likely to
meaningfully moderate the early stages of this recovery.
Nevertheless, DHI has the financial flexibility to navigate
through the still challenging market conditions and continue to
selectively and prudently invest in land opportunities.

Builder and investor enthusiasm have for the most part surged so
far in 2012.  However, housing metrics have not entirely kept
pace. Year-over-year comparisons have been solidly positive on a
consistent basis. However, month-to-month the statistics (single-
family starts, new home and existing home sales) have been erratic
and, at times, below expectations.  However, these macro numbers
in May were generally positive: single-family starts (+3.2%), new
home sales (+7.6%) and existing home sales (-1.5%).

Home prices have also been more encouraging of late, turning
positive for some series: FHFA +1.8% March, CoreLogic +2.2% April
(excluding distressed +2.6% April), Lender Processing Services
(LPS) +0.9% March, and Case-Shiller's 20-city price index (+1.3%)
in April.  Also, in any case, for the large public homebuilders
spring has so far been a resounding success.  As Fitch noted in
the past, the housing recovery will likely occur in fits and
starts.

Fitch has raised its housing forecasts for 2012 since the
beginning of the year. However, the forecast still assumes a
relatively modest rise off a very low bottom. Fitch forecasts
single-family housing starts to increase about 12%, with single-
family new home sales to expand approximately 10%.

DHI successfully managed its balance sheet during the housing
downturn and generated significant operating cash flow.  DHI had
been aggressively reducing its debt over the past few years.
Homebuilding debt declined from roughly $5.5 billion at June 30,
2006 to $1.94 billion currently (including $350 million of 4.75%
senior notes due 2017 issued in April 2012), a 65% reduction. Pro
forma debt-capitalization is 41.8%.  Net debt-capitalization is
26.6%.  DHI has lowered its homebuilding debt levels meaningfully
in each of the last three fiscal years (as shown below):

  -- By $336.3 million in fiscal 2009;
  -- By $991.3 million in fiscal 2010;and
  -- By $497.2 million in fiscal 2011.

This was accomplished through debt repurchases, maturities and
early redemptions.  Through the first six months of fiscal 2012
(ending March 31, 2012), DHI has repurchased an additional $10.8
million of senior notes.  DHI has $172 million of senior notes
maturing in May 2013.  DHI's next major debt maturity is in
January 2014, when $145 million of senior notes mature.

DHI currently has solid liquidity with unrestricted homebuilding
cash of $662.2 million and marketable securities of $299.1 million
as of March 31, 2012.

DHI maintains a 6.8-year supply of lots (based on last 12 months
deliveries), 71.3% of which are owned and the balance controlled
through options.  The options share of total lots controlled is
down sharply over the past five years as the company has written
off substantial numbers of options.  Fitch expects DHI to continue
rebuilding its land position and increase its community count.

The primary focus will be optioning (or in some cases, purchasing
for cash) finished lots, wherein DHI can get a faster return of
its capital.  DHI's cash flow from operations during the LTM
period ending March 31, 2012 was a negative $46.6 million.  For
all of fiscal 2012, Fitch expects DHI to be cash flow negative.

The ratings also reflect DHI's relatively heavy speculative
building activity (at times averaging 50-60% of total inventory
and 50% at March 31, 2012).  DHIhas historically built a
significant number of its homes on a speculative basis (i.e. begun
construction before an order was in hand).

A key focus is on selling these homes either before construction
is completed or certainly before a completed spec has aged more
than a few months.  This has resulted in consistently attractive
margins.  DHI successfully executed this strategy in the past,
including during the severe housing downturn.  Nevertheless, Fitch
is generally more comfortable with the more moderate spec targets
of 2004 and 2005, wherein spec inventory accounted for roughly 35-
40% of homes under construction.

Future ratings and Outlooks will be influenced by broad housing
market trends as well as company-specific activity, such as

  -- Trends in land and development spending;
  -- General inventory levels;
  -- Speculative inventory activity (including the impact of high
     cancellation rates on such activity);
  -- Gross and net new order activity;
  -- Debt levels;
  -- Free cash flow trends and uses; and
  -- DHI's cash position.

Negative rating actions could occur if the recovery in housing
does not continue and DHI prematurely and aggressively steps up
its land and development spending.  This could lead to consistent
and significant negative quarterly cash flow from operations and
diminished liquidity position.  Conversely, Fitch may consider
taking positive rating actions if the recovery in housing
persists, or accelerates and is significantly better than Fitch's
current outlook.  Fitch may consider positive rating action if the
housing recovery persists and DHI shows continuous improvement in
credit metrics while maintaining a healthy liquidity position.

Fitch has affirmed the following ratings for DHI and revised the
Rating Outlook to Positive:

  -- Long-term IDR at 'BB';
  -- Senior unsecured debt at 'BB'.


DBSI INC: Trustee Files Investor Suit Against Broker-Dealers
------------------------------------------------------------
Jake Simpson at Bankruptcy Law360 reports that the litigation
trustee for DBSI Inc. filed an investor lawsuit against a host of
broker-dealer firms in Delaware federal court Wednesday, accusing
them of aiding DBSI officials in conducting a $500 million Ponzi
scheme.

Trustee James R. Zazzali filed suit against 40 brokerages and
brokerage parent firms and more than 100 named individuals for
alleged securities violations related to the sale of DBSI
financial instruments to investors.  Mr. Zazzali is seeking
millions in compensatory damages from the firms to pay back
investors, Bankruptcy Law360 relates.

                          About DBSI Inc.

Headquartered in Meridian, Idaho, DBSI Inc. and its affiliates
were engaged in numerous commercial real estate and non-real
estate projects and businesses.  On Nov. 10, 2008, and other
subsequent dates, DBSI and 180 of its affiliates filed for
Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-12687).
DBSI estimated assets and debts between $100 million and
$500 million as of the Chapter 11 filing.

Lawyers at Young Conaway Stargatt & Taylor LLP represent the
Debtors as counsel.  The Official Committee of Unsecured Creditors
tapped Greenberg Traurig, LLP, as its bankruptcy counsel.
Kurtzman Carson Consultants LLC is the Debtors' notice claims and
balloting agent.

Joshua Hochberg, a former head of the Justice Department fraud
unit, served as an Examiner and called the seller and servicer of
fractional interests in commercial real estate an "elaborate shell
game" that "consistently operated at a loss" in his report
released in October 2009.  McKenna Long & Aldridge LLP was counsel
to the Examiner.

On Sept. 11, 2009, the Honorable Peter J. Walsh entered an Order
appointing James R. Zazzali as Chapter 11 trustee for the Debtors'
estates.  On Oct. 26, 2010, the trustee of DBSI Inc. won court
confirmation of its Chapter 11 plan of liquidation, paving the way
for it to pay creditors and avoid years of expensive litigation
over its complex web of affiliates.  The plan, which was declared
effective Oct. 29, 2010, was jointly proposed by DBSI's unsecured
creditors and the bankruptcy trustee in charge of DBSI and its
170-plus affiliates.

Pursuant to DBSI Inc.'s confirmed Chapter 11 plan, the DBSI Real
Estate Liquidating Trust was established as of the effective date
and certain of the Debtors' assets, including the Debtors'
ownership interest in Florissant Market Place was transferred to
the RE Trust.  Mr. Zazzali and Conrad Myers were appointed as the
post-confirmation trustees.  Messrs. Zazzali and Myers are
represented by lawyers at Blank Rime LLP and Gibbons P.C.


DELTA AIR: Moody's Assigns 'Ba3' Rating to Class B Tranche
----------------------------------------------------------
Moody's Investors Service assigned Baa2 and Ba3 ratings,
respectively, to the Class A and Class B Pass Through
Certificates, Series 2012-1 of the 2012-1 Pass Through Trusts that
Delta Air Lines, Inc. will establish.

Assignments:

  Issuer: Delta Air Lines, Inc.

    Senior Secured Enhanced Equipment Trust, A Tranche Assigned
    Baa2

    Senior Secured Enhanced Equipment Trust, B Tranche Assigned
    Ba3

Ratings Rationale

The ratings of the Certificates consider the credit quality of
Delta as obligor of the underlying equipment notes, Moody's
opinion of the collateral protection of the Notes, the credit
support provided by the liquidity facilities and certain
structural characteristics of the Notes such as the applicability
of Section 1110 of Title 11 of the United States Code (the "Code")
and the cross-collateralization and cross-default features. The
assigned ratings reflect Moody's opinion of the ability of the
Pass-Through Trustees to make timely payment of interest and the
ultimate payment of principal on the A- and B-Tranches' final
scheduled regular distribution dates of May 7, 2020 and May 7,
2019, respectively.

The Certificates' proceeds will fund the purchase of equipment
notes ("Notes") to be issued by Delta for 31 vintage aircraft; 17
narrow-bodies and 14 wide-bodies: nine Airbus A319-100s delivered
new to Northwest Airlines, Inc. in 2002, seven Airbus A320-200s
delivered new to Northwest Airlines, Inc. between 1998 and 2002,
one 2001-vintage Boeing B757-200, eight Boeing B767-300ERs
delivered new to Delta between 1995 and 1997, and six 2000-vintage
Boeing B767-400ERs. The transaction proceeds will partially or
entirely fund the refinancing of existing financings to which each
of the aircraft is currently pledged, including the company's
Series 2002-1 EETC, Northwest Airlines' 2001-2 EETC or Delta's
senior secured credit facilities arranged in April 2011. Amounts
due under the Certificates will be subordinated to any amounts due
on the separate Class A and Class B Liquidity Facilities, which
Natixis, S.A., acting through its New York Branch, will provide.

At 12.4 years, the average age of the aircraft in this transaction
will be the oldest at issuance of any recent newly-issued EETC.
While not anticipated, under a Delta bankruptcy scenario,
differences in aircraft mix across the company's EETCs and plans
for a reorganized network would affect decision-making with
respect to which, if any, of its EETCs Delta could disaffirm
pursuant to Section 1110 of the U.S. Bankruptcy Code. The older
age of the aircraft in each of Delta's 2012-1 and 2011-1 EETCs
could increase the probabilities of disaffirmation relative to the
other of Delta's EETCs under a default scenario. Moody's estimate
of the loan-to-value of the Certificates is in line with those of
Delta's other EETCs, particularly 2011-1. Moody's estimates the
initial loan-to-value of the tranches at just above 60% and just
above 80%, respectively. These LTV percentages are based on
Moody's estimates of current market values, before the priority
claim of the liquidity facilities and before applying an LTV
benefit for cross-collateralization of three percentage points in
this transaction.

The ratings assignment also reflects Moody's belief that the wide-
body aircraft in this transaction will remain important to Delta's
route network, notwithstanding their older vintages. Delta
currently has no wide-body aircraft on order and Moody's believes
it would likely be difficult to garner more than a handful of
wide-body delivery slots in the near term because of the current
backlogs for the B777 and A330 aircraft. As well, the Airbus
narrow-body collateral would likely remain relevant as these
aircraft represent some of the younger narrow-body vintages in the
fleet.

Any combination of future changes in the underlying credit quality
or ratings of Delta, unexpected material changes in the value of
the aircraft pledged as collateral, and/or changes in the status
or terms of the liquidity facilities or the credit quality of the
liquidity provider could cause Moody's' to change its ratings of
the Certificates.

The principal methodology used in rating Delta was the Enhanced
Equipment Trust And Equipment Trust Certificates Industry
Methodology published in December 2010.

Delta Air Lines, Inc., headquartered in Atlanta, Georgia, is one
of the world's largest airlines, providing scheduled air
transportation for passengers and cargo throughout the U.S. and
around the world.


DEWEY & LEBOEUF: Barclays, Citi Tell Ex-Partners to Repay Loans
---------------------------------------------------------------
Sara Randazzo, writing for The Am Law Daily, reports that Barclays
and Citibank are clamping down on former Dewey & LeBoeuf partners
who took out loans to fulfill their capital contribution
obligations to the firm, and Citi has initiated legal action
against at least one former partner to get its money back.

According to Am Law Daily, at the time they were hired, Dewey
partners were given until the end of the calendar year in which
they joined the firm to chip in 36% of their target compensation
as a capital contribution.  Through the years, Dewey worked first
with Barclays, and later with Citibank, to establish loan programs
that the firm stressed were the easiest way for partners to
quickly fulfill their capital obligations.  Dewey acted as the
middle man in the granting of the loans, according to several
former partners who participated in the programs, and often agreed
to pay the interest for a number of years to ease the burden on
its partners.  According to two former partners, the amount asked
of Dewey partners increased as target compensation increased, even
though -- as is now widely reported -- the firm failed for years
to pay partners what was promised.

According to Am Law Daily, now that Dewey is dead, former partners
are personally obligated to pay back any loans they took out, with
interest, and the banks have started taking action to get their
money.  The report relates two former partners say they have
received statements directly from Citi and Barclays, with both
banks suggesting unfavorable terms for repayment; another partner
says there has been no word yet from Citi and believes others are
in the same situation.

Am Law Daily relates Citi has taken legal action against former
Houston partner Steven Otillar, an oil and gas lawyer now with
Akin Gump Strauss Hauer & Feld.  The bank filed a summons in New
York state court May 31 seeking repayment of roughly $209,670,
which court papers say accounts for a $207,000 loan given Sept. 2,
2011, plus interest.  The amount equates to a target compensation
of $575,000, the report notes.  According to Citi's filing, the
loan contained a clause that triggered the default of the note if
Mr. Otillar ceased being a partner at Dewey.

The report says a representative for Citi declined to comment on
the lawsuit or the loan program.  A press representative for
Barclays did not return a request for comment Tuesday afternoon.

                       About Dewey & LeBoeuf

New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations.  The firm had struggled with high
debt and partner defections.  Dewey disclosed debt of $245 million
and assets of $193 million in its chapter 11 filing late evening
on May 29, 2012.

Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP.  At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe.  When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.

Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28.  All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure.  The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate.  The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.

The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for $6
million.  The Pension benefit Guaranty Corp. took $2 million of
the proceeds as part of a settlement.

Judge Martin Glenn oversees the case.  Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor.  Epiq Bankruptcy
Solutions LLC serves as claims and notice agent.  The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.

JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP.  JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors.  The Noteholders hired
Bingham McCutchen LLP as counsel.

The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners.  The creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel.  The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.

Dewey & LeBoeuf has won Court authority to use lenders' cash
collateral through July 31, 2012.


DOLLAR GENERAL: Moody's Rates $450MM Sr. Unsecured Notes 'Ba2'
--------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to Dollar General
Corporation's proposed $450 million senior unsecured notes due
2017. All other ratings including its Ba1 Corporate Family Rating,
and SGL-1 Speculative Grade Liquidity rating were affirmed. The
rating outlook is positive.

Ratings Rationale

The proceeds of the proposed $450 million senior unsecured notes
will be used to repay the senior subordinate notes due 2017.
Following the repayment, the senior subordinate notes will be
retired and its Ba3 rating withdrawn. Moody's views the
refinancing as a credit positive as the rating agency believes it
will likely reduce interest expense, thus improving interest
coverage.

The following rating is assigned subject to final documentation:

  $450 million senior unsecured notes due 2017 at Ba2 (LGD 5,86%)

The following rating will be withdrawn upon their repayment:

  Senior subordinate notes due 2017 at Ba3 (LGD 6, 97%)

The following ratings are affirmed:

  Corporate Family Rating at Ba1

  Senior Secured Term Loan B1 at Ba1 (LGD 3, 43%)

  Senior Secured Term Loan B2 at Ba2 (LGD 4, 68%)

  Extended Senior Secured Term Loan Tranche C at Ba1 (LGD 3, 43%)

  Speculative Grade Liquidity rating at SGL-1

The Ba1 Corporate Family Rating is supported by Dollar General's
market position as the largest dollar-store chain in the U.S.
Moody's views the dollar store sector favorably and expects that
it will continue to grow given its low price points and its
relative resistance to economic cycles. The rating also reflects
Dollar General's solid credit metrics and its very good liquidity.
The rating acknowledges that Dollar General's earnings are
expected to continue to grow at a healthy rate despite a limited
ability to pass on cost pressures to a price sensitive customer
which will limit Dollar General's gross margin.

Dollar General's ratings are constrained by its geographic
concentration. While operating over 10,000 stores in 40 states,
Dollar General is heavily concentrated in the south, which
accounts for approximately 47% of their store base. However, this
concentration risk may slowly dissipate as Dollar General
continues to grow its store count and break ground in new states,
much like their recent launch into California.

The positive outlook acknowledges the reduction of KKR's equity
ownership to below 50% which triggers a change in the composition
of the board of directors such that KKR no longer controls the
board. The positive outlook reflects that Moody's expects the
composition of the board to likely change over the next twelve to
eighteen months and that the revised board is likely to support
balanced and conservative financial policies.

An upgrade would require Dollar General's board of directors to
evidence support of financial policies which allow the company to
maintain credit metrics consistent with a higher rating over the
long term. Quantitatively, an upgrade would require debt to EBITDA
to remain below 3.0 times and EBITA to interest expense remain
above 4.5 times.

Ratings could be downgraded should Dollar General's financial
policies become more aggressive. Ratings could also be downgraded
should Dollar General's operating performance deteriorate or debt
levels increase such that debt to EBITDA is sustained above 4.0
times or EBITA to interest expense falls below 3.5 times.

The principal methodology used in rating Dollar General was the
Global Retail Industry Methodology published in June 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.

Dollar General Corporation, headquartered in Goodlettsville,
Tennessee, owns and operates over 10,000 extreme value general
merchandise stores. Revenues are over $15 billion.


DM DEVELOPMENT: Involuntary Chapter 11 Case Summary
---------------------------------------------------
Alleged Debtor: DM Development LLC
                dba Doylem Development LLC
                1175 York Avenue
                New York, NY 10065

Case Number: 12-12709

Involuntary Chapter 11 Petition Date: June 26, 2012

Court: Southern District of New York (Manhattan)

Judge: Martin Glenn

Petitioner's Counsel: Pro Se

DM Development LLC's petitioner:

Petitioner               Nature of Claim        Claim Amount
----------               ---------------        ------------
Financial Service        Advisory Fees          $257,000
Advisors
P.O. Box 1649
Lake Worth, FL 33460


EASTMAN KODAK: July 26 Hearing to Name Court for Patent Issues
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when Eastman Kodak Co. holds a hearing in bankruptcy
court on July 2 for approval of procedures for selling digital
imaging technology, the bankruptcy judge won't know yet whether a
federal district judge will take away the right to make decisions
regarding patent disputes.

The report recounts that when Kodak sued Apple Inc. this month for
a declaration about ownership of 10 patents, Apple responded by
filing a request for a federal district judge to take the dispute
out of bankruptcy court.  On June 27, U.S. District Judge George
B. Daniels called for a hearing on July 26 to decide if making a
patent decision is beyond the competence of the bankruptcy
court.

According to the report, when the bankruptcy court in New York
conducts the hearing on July 2, there will be objections from
high-technology companies contending he doesn't have the right to
rule on issues involving technology ownership. The ruling Judge
Daniels will make after the July 26 hearing may decide the extent
to which the bankruptcy court can make rulings on disputes
regarding patent rights in the course of selling Kodak technology.
Companies objecting to having decisions made in bankruptcy court
include Intel Corp., Ricoh Co. Ltd., Nikon Corp., Motorola
Solutions Inc., and Apple.

                       About Eastman Kodak

Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.

Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras.  Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies with
strong balance sheets and an awareness of Kodak's liquidity
challenges.

In recent years, Kodak has been working to transform itself from a
business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies.  Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.

Kodak disclosed $5.10 billion in assets and $6.75 billion in
liabilities as of Sept. 30, 2011.  The net book value of all
assets located outside the United States as of Dec. 31, 2011 is
$13.5 million.

Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors.  FTI Consulting,
Inc., is the restructuring advisor.   Lazard Freres & Co. LLC, is
the investment banker.   Kurtzman Carson Consultants LLC is the
claims agent.  A group of second lien lenders are represented by
Akin Gump Strauss Hauer & Feld LLP.

The Official Committee of Unsecured Creditors has tapped
Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.


FASHION PLACE: Wins Confirmation of 2nd Amended Plan
----------------------------------------------------
Fashion Place Dental, Inc., won confirmation of its Second Amended
Plan of Reorganization dated Feb. 7, 2012.  The Amended Disclosure
Statement was approved on Feb. 22.  The hearing on confirmation of
the Plan was held May 3 at 11:00 a.m.  A copy of Bankruptcy Judge
R. Kimball Mosier's Findings of Fact and Conclusions of Law in
Support of Order Confirming Debtor's Second Amended Plan of
Reorganization dated June 25, 2012, is available at
http://is.gd/0w0zAffrom Leagle.com.

Fashion Place Dental, Inc., filed for Chapter 11 bankruptcy
(Bankr. D. Utah Case No. 10-35809) on Nov. 12, 2010, estimating
under $1 million in assets and debts.  A copy of the petition is
available for free at http://bankrupt.com/misc/utb10-35809.pdf

The Debtor is represented by:

          Michael C. Van, Esq.
          Clay A. Alger, Esq.
          SHUMWAY VAN & HANSEN
          Las Vegas, NV
          Telephone: (702) 478-7770
          Facsimile: (702) 478-7779
          E-mail: michael@shumwayvan.com


FIRST HORIZON: Mortgage Repurchase Cues Fitch to Lower Ratings
--------------------------------------------------------------
Fitch Ratings has downgraded the ratings of First Horizon National
Corporation (FHN) and lead bank First Tennessee Bank, N.A.
(FTBNA).  Fitch has also placed FHN's long- and short-term Issuer
Default Ratings (IDRs) on Rating Watch Negative.

The downgrade follows FHN's announcement that it will be taking
a very large mortgage repurchase provision in 2Q'12.  FHN expects
to report $250 million in pre-tax charges related to mortgage
repurchases, as compared to an average of approximately $50
million the prior three quarters.  As a result, FHN will likely
report a loss for the full year 2012.  Even excluding this charge,
FHN's earnings profile had been trending lower than similarly
rated peers for several quarters.

Previously, Fitch viewed an outsized charge as a negative rating
driver, and this provision represents a material charge for the
company.  Although FHN's ability to quantify potential mortgage
repurchase losses was previously limited because it no longer
services a large portion of loans sold to the agencies and lacked
access to underlying loan data, this charge was still outside of
Fitch's expectations.

Fitch will be reviewing all the ratings in the very near term.
Accordingly, there is the potential of further downgrades to FHN's
rating.  FHN's ability to return profitability measures more in
line with peer averages will be one of the key rating drivers in
the next review.  Potential private label put-back risk, which to
date has not been an issue for FHN, will also be incorporated in
the upcoming review.

Fitch has downgraded and placed on Rating Watch Negative the
following ratings:

First Horizon National Corporation

  -- Long-term IDR to 'BBB' from 'BBB+';
  -- Viability to 'bbb' from 'bbb+';
  -- Subordinated debt to 'BBB-' from 'BBB';
  -- Senior to 'BBB' from 'BBB+'.

First Tennessee Bank, N.A.

  -- Long-term IDR to 'BBB' from 'BBB+';
  -- Viability to 'bbb' from 'bbb+';
  -- Long-term deposits to 'BBB+' from 'A-';
  -- Short-term deposits to 'F2' from 'F1';
  -- Subordinated debt to 'BBB-' from 'BBB';
  -- Preferred stock to 'B+' from 'BB-'.

First Tennessee Capital II

  -- Preferred stock to 'BB-' from 'BB'.

Fitch affirms the following ratings:

First Horizon National Corporation

  -- Support at '5';
  -- Support Floor at 'NF'.

First Tennessee Bank, N.A.

  -- Support at '5';
  -- Support Floor at 'NF'.

Fitch has placed the following rating on Rating Watch Negative:

First Horizon National Corporation

  -- Short-term IDR 'F2'.

First Tennessee Bank, N.A.

  -- Short-term IDR 'F2';
  -- Short-term debt 'F2'.


FIRST SECURITY: Nine Directors Elected at Annual Meeting
--------------------------------------------------------
The annual meeting of shareholders of the First Security Group,
Inc., was held on June 20, 2012.  The Company's common stock
holders elected seven directors to serve until the 2013 Annual
Meeting of Shareholders and until their successors have been
elected and qualified, namely:

   (1) William C. Hall;
   (2) Carol H. Jackson;
   (3) Robert P. Keller;
   (4) Ralph L. Kendall;
   (5) Kelly P. Kirkland;
   (6) Michael D. Kramer; and
   (7) Larry D. Mauldin.

William F. Grant, III, and Robert R. Lane were elected by First
Security's Series A Preferred Stock holder as directors to serve
until the 2013 Annual Meeting of Shareholders and until their
successors are elected and qualified, or until all dividends
payable on all outstanding shares of the Series A Preferred Stock
have been declared and paid in full.

A non-binding resolution approving the compensation of First
Security's executive officers was approved.  The shareholders
approved the adoption of the First Security Group, Inc., 2012
Long-Term Incentive Plan.  The appointment of Crowe Horwath LLP as
First Security's independent public accounting firm for the fiscal
year ending Dec. 31, 2012, was ratified.

                    About First Security Group

First Security Group, Inc., is a bank holding company
headquartered in Chattanooga, Tennessee, with $1.2 billion in
assets as of Sept. 30, 2010.  Founded in 1999, First
Security's community bank subsidiary, FSGBank, N.A., has 37 full-
service banking offices, including the headquarters, along the
interstate corridors of eastern and middle Tennessee and northern
Georgia and 325 full-time equivalent employees.  In Dalton,
Georgia, FSGBank operates under the name of Dalton Whitfield Bank;
along the Interstate 40 corridor in Tennessee, FSGBank operates
under the name of Jackson Bank & Trust.

In the auditors' report
accompanying the financial statements for year ended Dec. 31,
2011, Joseph Decosimo and Company, PLLC, in Chattanooga,
Tennessee, expressed substantial doubt about the Company's ability
to continue as a going concern.  The independent auditors noted
that the Company has recently incurred substantial losses.  The
Company is also operating under formal supervisory agreements with
the Federal Reserve Bank of Atlanta and the Office of the
Comptroller of the Currency and is not in compliance with all
provisions of the Agreements.  Failure to achieve all of the
Agreements' requirements may lead to additional regulatory
actions.

The Company reported a net loss of $23.06 million in 2011, a net
loss of $44.34 million in 2010, and a net loss of $33.45 million
in 2009.

The Company's balance sheet at March 31, 2012, showed $1.13
billion in total assets, $1.06 billion in total liabilities and
$61.83 million in total stockholders' equity.


FISH & FISHER: Merchants & Farmers Bank Barred From Amending Suit
-----------------------------------------------------------------
Bankruptcy Judge Edward Ellington barred Merchants & Farmers Bank
from filing a third amended complaint and raise new claims against
Frank Coxwell and Coxwell & Associates, PLLC, saying the bank sat
on new evidence for two months without bringing it to the
attention of the Court even though M&F Bank knew that a Motion to
Dismiss the lawsuit was pending.  Only now -- two months after M&F
Bank had filed its response to the Motion to Dismiss, and after
the Court had entered an Opinion and Final Judgment dismissing
Coxwell from the lawsuit -- does M&F seek permission to amend the
Second Amended Complaint.

"By analogy, it is as if in a poker game, after the players have
placed their bets, and after they have turned over their cards, a
losing player now wants to draw again to improve his hand.  It
appears that the two-month delay was a deliberate strategy, a
gamble that did not pay off.  M&F cannot disavow its failed
strategy by blaming Coxwell for not producing the new evidence
earlier," Judge Ellington said.

The Court also said M&F Bank has over-inflated the significance of
the new evidence, saying it does not cure the deficiencies in the
allegations of the Second Amended Complaint.

The Second Amended Complaint named Coxwell as a defendant, as well
as certain creditors of Fish & Fisher.  All of the creditors,
according to M&F Bank, received varying amounts of proceeds from
an arbitration award received by Fish & Fisher and then disbursed
by Coxwell in satisfaction of certain debts owed by Fish & Fisher.
Coxwell had been retained as counsel for Fish & Fisher to
undertake this responsibility.  M&F Bank, who was also a creditor
of Fish & Fisher, received no payment from the arbitration award.

The lawsuit is MERCHANTS AND FARMERS BANK, v. FISH & FISHER, INC.,
DEBTOR, FRANK COXWELL, COXWELL & ASSOCIATES, PLLC, SEKCO, INC.,
H&E EQUIPMENT SERVICES, INC., PUCKETT MACHINERY COMPANY, WARING
OIL COMPANY, LLC, McGRAW RENTAL & SUPPLY COMPANY, INC., UNITED
STATES OF AMERICA, AND PRECIOUS MARTIN, Adv. Proc. No. 11-00027
(Bankr. S.D. Miss.).  A copy of the Court's June 25, 2012 Findings
of Fact and Conclusions of Law is available at http://is.gd/5r5gv8
from Leagle.com.

On Aug. 7, 2009, M&F and two other creditors filed an involuntary
Chapter 7 petition (Bankr. S.D. Miss. Case No. 09-02747) against
Fish & Fisher.  An order for relief was entered on Sept. 23, 2009.
At the behest of Fish & Fisher, the Court converted the case to a
Chapter 11 case on March 2, 2010.


FRANKLIN CREDIT: Sets July 6 as Record Date for Distribution
------------------------------------------------------------
Franklin Credit Holding Corporation gave notice to the Financial
Industry Regulatory Authority of the proposed record date of
July 6, 2012, to identify stockholders for purposes of the
proposed distribution to each stockholder of the Company, as of
the close of business of the Record Date, of a pro rata share of
the Company's 80% interest in its mortgage servicing subsidiary,
Franklin Credit Management Corporation, pursuant to the proposed
Prepackaged Plan of Reorganization of Franklin Credit Holding
Corporation.

Although the confirmation hearing in the bankruptcy case is
scheduled for July 18, 2012, there can be no assurance that the
Bankruptcy Court will confirm the Prepackaged Plan, that the
Bankruptcy Court will approve the Record Date, or that there will
be a pro rata distribution of the Company's 80% interest in its
mortgage servicing subsidiary, Franklin Credit Management
Corporation, to each stockholder of the Company, effective as of
the close of business on the Record Date.

                   About Franklin Credit Holding

Franklin Credit Holding Corporation (OTC BB: FCMC)
-- http://www.franklincredit.com/-- is a specialty consumer
finance company primarily engaged in the servicing and resolution
of performing, re-performing and nonperforming residential
mortgage loans, including specialized loan recovery servicing, and
in the analysis, pricing, due diligence and acquisition of
residential mortgage portfolios for third parties.  The Company's
executive, administrative and operations offices are located in
Jersey City, N.J.

Franklin Credit Holding Corporation filed a Chapter 11 bankruptcy
petition (Bankr. D. N.J. Case No. 12-24411) in Newark, New Jersey,
on June 4, 2012.  Franklin Credit also filed a prepackaged plan.
The Debtor is seeking a combined hearing on the plan and the
explanatory disclosure statement.

Judge Donald H. Steckroth presides over the case.  Lawyers at
McCarter & English, LLP, serves as the Debtor's counsel.

In its petition, the Debtor estimated $1 million to $10 million in
assets and $500 million to $1 billion in debts.  In a recent
regulatory filing with the U.S. Securities and Exchange
Commission, Franklin Credit Holding's balance sheet at March 31,
2012, showed $29.02 million in total assets, $874.02 million in
total liabilities, and a $845 million total stockholders' deficit.
The petition was signed by Paul Colasono, executive vice president
and chief financial officer.

The Plan provides for the liquidation of its assets -- the
ownership of 80% of the stock in non-debtor Franklin Credit
Mortgage Corp. -- with the proceeds or the fair market value of
the assets being distributed in accordance with the Bankruptcy
Code.  The fair market value of FCMC will be distributed through
the payment of $250,000 in cash on the effective date of the Plan
and an aggregate $1.11 million over a period of five years,
evidenced by a promissory note guaranteed by Thomas J. Axon, the
chairman and president of the Debtor and FCMC, and the owner of
20% of the common shares of FCMC, and 45.2% of the common shares
of the Debtor.  The payments will be made by FCMC, and will be the
primary source of cash for distributions contemplated by the Plan.
IN exchange for the payment by FCMC, the Debtor's interests in the
stock of FCMC will be distributed, pro-rata, to holders of allowed
interests.

The Plan provides for payment in full of allowed priority non-tax
claims.  The secured claims of the legacy lenders totaling
$820.6 million will be unaltered by the Plan.  Huntington National
Bank and Huntington Finance LLC will release the Debtor from any
obligations in connection with their secured claims of $4.7
million.  Holders of general unsecured claims estimated to total
$1.9 million will receive their pro rata share of the proceeds of
the liquidation of the remaining assets.

The Court has established July 18, 2012, as the hearing on the
adequacy of the Disclosure Statement.


GARLOCK SEALING: WD Pa. Court Defers to Delaware District Court
---------------------------------------------------------------
District Judge Nora Barry Fischer in the Western District of
Pennsylvania declined to rule on 3 of the 12 separate appeals
initiated by Garlock Sealing Technologies, LLC, from Bankruptcy
Judge Judith K. Fitzgerald's Memorandum Opinion and Order issued
Oct. 7, 2011, denying Garlock's motions to access records in
asbestos-related Chapter 11 bankruptcies of:

     -- Pittsburgh Corning; North American Refractories; and
        Mid-Valley Inc., which are pending before the Bankruptcy
        Court for the Western District of Pennsylvania; and

     -- Owens Corning; Armstrong World Industries, et al.;
        W.R. Grace & Co.; USG Corp. et al.; United States Mineral
        Products Company; Kaiser Aluminum Corp.; ACandS Inc.;
        Combustion Engineering Inc.; Flintkote Company, which are
        pending before the Bankruptcy Court for the District of
        Delaware.

The consolidated opinion and order resolved motions filed by
Garlock in nine bankruptcy cases in the Delaware Bankruptcy Court
and three bankruptcies in the Western District of Pennsylvania
Bankruptcy Court.  This procedural nuance is possible because
Judge Fitzgerald is assigned to hear bankruptcy cases in both
Bankruptcy Courts.  Garlock filed 12 separate appeals of Judge
Fitzgerald's rulings, including three appeals pending before the
Western District of Pennsylvania District Court and nine appeals
in the Delaware District Court.  Garlock admits that its appeals
are identical in that they all challenge the same rulings by the
Bankruptcy Court and raise the same arguments on appeal.  The
substance of Garlock's briefing in the two fora appears virtually
indistinguishable, aside from required changes to the case caption
and parties in each case.  Garlock's appeals focus on its desire
to access Fed.R.Bankr.P. Rule 2019 statements filed by creditor
committees and law firms in the bankruptcy cases.  The parties
with an actual interest in the 12 appeals include Garlock, law
firms and creditor committees, while the 12 debtors have more of a
tangential interest in avoiding Garlock's attempts to intervene in
their respective cases.

Judge Fischer said she will exercise discretion and stay the 3
proceedings pending disposition of the appeals before the Delaware
District Court.

Judge Fischer cited, among others, the need to avoid duplicative
litigation.  Judge Fischer said the parties could have stipulated
to a transfer of the WDPA appeals to Delaware or alternatively,
reached a stipulation wherein the parties in the WDPA appeals
would agree to be bound by the decision from District Judge
Leonard P. Stark, who is assigned to the Delaware appeals.  Judge
Fischer also noted that, after the stay is lifted, Judge Stark's
decision will likely be very persuasive to the WDPA Court.
According to Judge Fischer, based on her review of the litigation,
it appears that any decision rendered at the District Court level,
whether it be issued by Judge Stark or Judge Fischer, will be
further appealed to the United States Court of Appeals for the
Third Circuit.  As such, there is simply no benefit to having two
separate District Courts analyze this case simultaneously.

A copy of Judge Fischer's Memorandum Opinion dated June 21 is
available at http://is.gd/znOx6dfrom Leagle.com.

                       About Garlock Sealing

Headquartered in Palmyra, New York, Garlock Sealing Technologies
LLC is a unit of EnPro Industries, Inc. (NYSE: NPO).  For more
than a century, Garlock has been helping customers efficiently
seal the toughest process fluids in the most demanding
applications.

On June 5, 2010, Garlock filed a voluntary Chapter 11 petition
(Bankr. W.D. N.C. Case No. 10-31607) in Charlotte, North Carolina,
to establish a trust to resolve all current and future asbestos
claims against Garlock under Section 524(g) of the U.S. Bankruptcy
Code.  The Debtor estimated $500 million to $1 billion in assets
and up to $500 million in debts as of the Petition Date.
Affiliates The Anchor Packing Company and Garrison Litigation
Management Group, Ltd., also filed for bankruptcy.

The filing covers only Garlock operations in Palmyra, New York and
Houston, Texas.  Garlock Rubber Technologies, Garlock Helicoflex,
Pikotek, Technetics, Garlock Europe and Garlock operations in
Canada, Mexico or Australia are not affected by the filing, nor is
EnPro Industries or any other EnPro operating subsidiary.

Albert F. Durham, Esq., at Rayburn Cooper & Durham, P.A.,
represents the Debtor in its Chapter 11 effort.  Garland S.
Cassada, Esq., at Robinson Bradshaw & Hinson, serves as counsel
for asbestos matters.

The Official Committee of Asbestos Personal Injury Claimants in
the Chapter 11 cases is represented by Travis W. Moon, Esq., at
Hamilton Moon Stephens Steele & Martin, PLLC, in Charlotte, NC,
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, in New
York, and Trevor W. Swett III, Esq., Leslie M. Kelleher, Esq., and
Jeanna Rickards Koski, Esq., in Washington, D.C. 20005.

Joseph W. Grier, III, the Court-appointed legal representative for
future asbestos claimants, has retained A. Cotten Wright, Esq., at
Grier Furr & Crisp, PA, and Richard H. Wyron, Esq., and Jonathan
P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, as his co-
counsel.

About 124,000 asbestos claims are pending against Garlock in
stateand federal courts across the country.  The Company says
majority of pending asbestos actions against it is stale and
dormant -- almost 110,000 or 88% were filed more than four years
ago and more than 44,000 or 35% were filed more than 10 years ago.


GENERAL MOTORS: Salina Claims $13-Mil. Shortfall in Superfund Deal
------------------------------------------------------------------
Amanda Bransford at Bankruptcy Law360 reports that the town of
Salina, N.Y., on Wednesday objected to a $39.2 million settlement
between the trust that succeeded General Motors Co. and the U.S.
Environmental Protection Agency, saying it underestimates the
company's contributions to the town's cleanup costs by $13
million.

                       About General Motors

With its global headquarters in Detroit, Michigan, General Motors
Company (NYSE:GM, TSX: GMM) -- http://www.gm.com/-- is one of
the world's largest automakers, traces its roots back to 1908.
GM employs 208,000 people in every major region of the world and
does business in more than 120 countries.  GM and its strategic
partners produce cars and trucks in 30 countries, and sell and
service these vehicles through the following brands: Baojun,
Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Isuzu, Jiefang,
Opel, Vauxhall, and Wuling.  GM's largest national market is
China, followed by the United States, Brazil, the United Kingdom,
Germany, Canada, and Italy.  GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.

General Motors Co. was formed to acquire the operations of
General Motors Corp. through a sale under 11 U.S.C. Sec. 363
following Old GM's bankruptcy filing.  The U.S. government once
owned as much as 60.8% stake in New GM on account of the
financing it provided to the bankrupt entity.  The deal was
closed July 10, 2009, and Old GM changed its name to Motors
Liquidation Co.

On Nov. 1, 2011, Moody's Investors Service raised New GM's
Corporate Family Rating and Probability of Default Rating to Ba1
from Ba2, and its secured credit facility rating to Baa2 from
Baa3.  Moody's also raised the Corporate Family Rating of GM's
financial services subsidiary -- GM Financial -- to Ba3 from B1.

On Oct. 7, 2011, Fitch Ratings upgraded the Issuer Default
Ratings of New GM, General Motors Holdings LLC, and General
Motors Financial Company Inc., to 'BB' from 'BB-'.

On Oct. 3, 2011, Standard & Poor's Ratings Services raised its
corporate credit rating on New GM to 'BB+' from 'BB-'; and
revised the rating outlook to stable from positive. "We also
raised our issue-level rating on GM's debt to 'BBB' from 'BB+';
the recovery rating remains at '1'," S&P said.

                     About Motors Liquidation

General Motors Corporation and three of its affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on
June 1, 2009.  The Honorable Robert E. Gerber presides over the
Chapter 11 cases.  Harvey R. Miller, Esq., Stephen Karotkin,
Esq.,and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges
LLP, assist the Debtors in their restructuring efforts.  Al Koch
at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as
the Chief Executive Officer for Motors Liquidation Company.  GM
is also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel.  Cravath, Swaine, & Moore LLP
is providing legal advice to the GM Board of Directors.  GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP.  Garden City Group is the claims and notice
agent of the Debtors.

The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured
Creditors Holding Asbestos-Related Claims.  Lawyers at Kramer
Levin Naftalis & Frankel LLP served as bankruptcy counsel to the
Creditors Committee.  Attorneys at Butzel Long served as counsel
on supplier contract matters.  FTI Consulting Inc. served as
financial advisors to the Creditors Committee.  Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee.  Legal Analysis Systems, Inc., served as asbestos
valuation analyst.

The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011.  The Plan
was declared effect on March 31, 2011.


GENWORTH FINC'L: Moody's Places 'Ba1' Sub. Debt Rating on Review
----------------------------------------------------------------
Moody's Investors Service has placed the debt ratings of Genworth
Financial, Inc. ("Genworth"; NYSE: GNW, senior debt at Baa3) and
the insurance financial strength (IFS) ratings of its US Mortgage
Insurance (MI) operating companies on review for downgrade. In the
same rating action, Moody's downgraded the IFS ratings of
Genworth's primary life insurance operating subsidiaries to A3
from A2 with a stable outlook. A complete list of affected ratings
is given below. Moody's ratings on Genworth Financial Mortgage
Insurance Pty Limited (Genworth Australia, IFS at A1) and Genworth
Financial Mortgage Indemnity Limited (Genworth Indemnity, IFS at
A2) are unaffected by the rating action and remain on review for
downgrade.

Ratings Rationale

US Life Operations

Commenting on the downgrade of the IFS rating of the US life
operations, Moody's Senior Vice President Scott Robinson said,
"Although Genworth Life Insurance Company (primary US life
operating company of Genworth) remains well capitalized (NAIC Risk
Based Capital (RBC) ratio of 425% as of Q1 2012) and has a leading
market position in long term care (LTC) insurance and a strong
position in term insurance, Moody's views it as having a weaker
credit profile when compared with some of its similarly rated
peers." Regarding its business profile, the company's solid brand
and broad product suite is somewhat offset by the company's lack
of "lower risk" type products and concentrated position in long-
term care, which Moody's considers to be a "higher risk" product.
Related to its financial profile, the rating agency said the
company's profitability, although improving, remains low compared
to peers. On a statutory basis, this has hurt the company's level
of unassigned surplus, which restricts the amount of ordinary
dividends that can be paid to the holding company. The rating
agency noted that the company is taking a number of actions to
improve its unassigned surplus position.

The A3 IFS rating for the life operations is supported by the
company's relatively diversified earnings, competitive positions
in income and protection products, and proactive steps management
has taken to raise capital and address upcoming debt maturities at
the holding company. These strengths are somewhat offset by the
holding company's modest financial flexibility, pressure from
shareholders to take "shareholder-friendly" actions to improve
market / book value, and a lack of lower risk product reserves.

US Mortgage Insurance (GMICO)

Genworth Mortgage Insurance Corporation's (`GMICO'- collectively
all rated US MI operating company affiliates) Ba1 insurance
financial strength rating has been placed on review for downgrade
due to the uncertainty about the strength of its parent (under
review for possible downgrade) and about the likelihood of future
capital support -- which might be limited in most scenarios -- see
section on holding company below. The review will also evaluate
GMICO's ability to continue writing new business given the firm's
high risk to capital level and the year-end expiration of most
regulatory and counterparty waivers. Other issues in consideration
are the firm's contemplated structural alternatives.

GMICO's current rating reflects the firm's modest capitalization,
continued dependence on regulatory forbearance to write new
business and some implicit support from its parent. The rating
also takes into consideration the weak credit trends in the US
housing market, substantial remaining uncertainty about the role
of private mortgage insurers in the post mortgage-reform
environment and improved underwriting prospects for GMICO
following the exit of two competitors.

Holding Company

Commenting on the review for downgrade of Genworth, Robinson said:
"The review will focus on the evaluation of holding company
financial flexibility over the near to medium term. We will
consider management actions and plans to enhance flexibility,
limit the potential downside impact of the lower rated US MI on
the rest of the operations, as well as potential parental
support."

Genworth's Baa3 senior debt rating is currently 3 notches lower
than the A3 IFS ratings of the company's life insurance operating
entities, the standard notching practice for insurance groups.
Prior to the rating action, the notching differential between the
main life insurance operating entities and the holding company was
4 notches, a reflection of the lower credit profile and downside
risks of US MI, including its potential need for additional
support.

Rating Drivers - life insurance group

Moody's commented that the following could lead to an upgrade in
the IFS rating for the life insurance entities: 1) Losses and
capital requirements of the stress case scenario for the US MI
operations are determined to have a modest impact on the group; 2)
2012 US life insurance GAAP operating earnings > $300 million,
excluding the impact of life block transactions; 3) US Life
Insurance sales growing at industry rate without disproportionate
growth in LTC; and 4) Unassigned surplus as of year-end 2012 >
$100 million. Conversely, the following could lead to a further
downgrade of the IFS rating for the life insurance entities: 1)
2012 US life insurance GAAP operating earnings < $250 million,
excluding the impact of life block transactions; 2) Financial
leverage in excess of 30% and/or earnings coverage less than 2x on
a sustained basis; and 3) Unassigned surplus as of year-end 2012 <
$100 million.

Rating Drivers -- US mortgage insurance

The following factors could lead to confirmation of the ratings of
the US mortgage insurance subsidiaries: 1) Greater certainty about
ability to maintain new business flows over the medium term (12-24
months) 2) Parent's willingness to provide capital support 3)
Significant improvement in rate of new delinquencies and/or cures
4) Statutory loss ratio less than 100% and 5) A regulatory
framework that improves the market opportunity for private
mortgage insurers.

Conversely, the following factors could lead to a downgrade of
GMICO: 1) Weakening parental support of the US MI operation 2)
Non-renewal of GSE and regulatory agreement/forbearance when they
expire 3) Restructuring of operations that would result in reduced
new business flows for the flagship, Genworth Mortgage Insurance
Corporation 4) Risk to Capital greater than 40x and 5) Statutory
loss ratio greater than 200%.

Rating Drivers - holding company

According to Moody's, the following could lead to a confirmation
of the holding company's ratings: 1) De-linkage from the US MI
operations so that a downside scenario would not impact holding
company creditors or determination that a downside scenario would
have a modest impact on the group; 2) Capital actions that enhance
holding company financial flexibility without hurting long-term
earnings power of the company. On the other hand, the following
could result in a downgrade of the holding company's ratings: 1)
Failure to de-link the US MI from holding company creditors or
determination that a downside scenario would have more than a
modest impact on the group; 2) Failure to take capital actions
that enhance holding company financial flexibility without hurting
long-term earnings power of the company.

The principal methodologies used in rating Genworth were "Moody's
Global Rating Methodology for Life Insurers," published in May
2010 and "Moody's Global Rating Methodology for the Mortgage
Insurance Industry" published in February 2007.

The following ratings were placed on review for downgrade:

Genworth Financial, Inc. -- senior unsecured debt rating at Baa3,
junior subordinated debt rating at Ba1(hyb), senior unsecured
shelf rating at (P)Baa3, subordinate shelf rating at (P)Ba1,
preferred shelf rating at (P)Ba2, short-term debt rating for
commercial paper at P-3

Genworth Mortgage Insurance Corporation -- insurance financial
strength rating at Ba1

Genworth Residential Mortgage Insurance Corporation of NC --
insurance financial strength rating at Ba1

Genworth Seguros de Credito a la Vivienda -- insurance financial
strength rating at Baa3, national scale insurance financial
strength rating at Aa3.mx

The following ratings were downgraded with a stable outlook:

Genworth Life Insurance Company -- insurance financial strength
rating to A3 from A2, short term insurance financial strength
rating to P-2 from P-1

Genworth Life and Annuity Insurance Company -- insurance
financial strength rating to A3 from A2, short term insurance
financial strength rating to P-2 from P-1

Genworth Life Insurance Company of New York -- insurance
financial strength rating to A3 from A2

Genworth Global Funding Trusts -- funding agreement-backed senior
secured Medium-Term Note Program to (P)A3 from (P)A2

Genworth Global Funding Trusts 2006-C; 2006-E; 2007-A; 2007-3
through 4; 2008-1 through 2; 2008-5; 2008-7; 2008-9 through 49
-- funding agreement-backed senior secured debt rating to A3
from A2

Genworth Life Institutional Funding Trust -- funding agreement-
backed senior secured debt to A3 from A2, senior secured debt to
A3 from A2, backed senior secured Medium-Term Note Program to
(P)A3 from (P)A2

General Repackaging ACES SPC, Series 2007-2; Series 2007-3;
Series 2007-6; Series 2007-7 -- funding agreement-backed senior
secured debt rating to A3 from A2;

Genworth Financial, Inc., headquartered in Richmond, Virginia,
reported total assets of $111 billion and total shareholders'
equity of $15.9 billion as of March 31, 2012.

Moody's insurance financial strength ratings are opinions of the
ability of insurance companies to pay punctually senior
policyholder claims and obligations.


GEOEYE INC: S&P Lowers CCR to 'B-' on NGA Funding Uncertainty
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on GeoEye
Inc., including the corporate credit rating to 'B-' from 'B+'. The
outlook is developing.

"We also lowered all issue-level ratings by two notches. In
addition, we withdrew the rating on subsidiary ORBIMAGE Inc., as
there is no debt associated with this entity," S&P said.

"The rating actions reflect what we consider heightened risk of a
substantial reduction of U.S. government revenues beginning in
late 2012 or in late 2013," said Standard & Poor's credit analyst
Michael Weinstein, "which, in our view, would severely reduce the
company's profitability and cash flow generation.' Accordingly, we
have revised our business risk assessment to 'vulnerable' and our
financial risk assessment to 'highly leveraged.'"

"GeoEye said it received notice from the National Geospatial-
Intelligence Agency (NGA) that the government agency would not
fully renew the EnhancedView service-level agreement (SLA) for the
contract year Sept. 1, 2012 through Aug. 31, 2013. Instead, the
NGA proposed a new three-month option, which it intends to
exercise, providing service revenue to GeoEye from Sept. 1, 2012
through Nov. 30, 2012 of $39.75 million. The NGA also proposed an
additional nine-month option for the remainder of the contract
year through Aug. 31, 2013, providing $119.25 million of revenue.
However, the agency said the second option is based on the
availability of U.S. government funding," S&P said.

"In addition, the NGA told GeoEye that it is proposing to change a
cost-sharing agreement for the development of GeoEye-2, a new
satellite scheduled to launch in the first half of 2013. Of the
$181 million that the NGA previously agreed to fund, GeoEye
expects that it will receive $111 million within the next 30 days.
The remaining $70 million in funding depends on certain milestones
being met, with no guarantees that funding beyond the $181 million
will be provided," S&P said.

"The developing outlook indicates there is a one-third or greater
possibility of a downgrade and a one-third or greater possibility
of an upgrade over the next year, pending further clarity around
the NGA's funding decisions for GeoEye's services. We could lower
the rating if the NGA decided not to exercise the additional nine-
month option for the next contract year and all SLA revenues
ceased in December 2012. We could also lower the rating if the
likelihood of GeoEye losing all or most of its government business
became more likely," S&P said.

"Conversely, we could raise the rating if the company were to
receive greater clarity about future funding for the SLA program
and once GeoEye-2 became fully operational. However, we believe an
upgrade would be limited to one notch given the likelihood of
ongoing funding risks. The ability to diversify with other
customers would be a positive factor, but given long lead times
for new business wins, this is likely to be a positive rating
factor on its own in the next year," S&P said.


GLOBAL AVIATION: S&P Withdraws 'D' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services withdrew all of its ratings,
including the 'D' corporate credit rating, on Global Aviation
Holdings Inc. "As part of our final recovery analysis prior to
withdrawing the ratings, we revised the recovery rating on the
company's first-lien debt to '4', indicating our expectation that
lenders will receive an average recovery (30%-50%), from '3'," S&P
said.

"We revised the recovery rating to reflect the inclusion of the
debtor-in-possession (DIP) financing as a priority claim in the
capital structure," S&P said.

Global Aviation filed for Chapter 11 bankruptcy protection on Feb.
5, 2012. Prior to its filing, the company's earnings had been
under significant pressure from the depressed state of the air
cargo market and reduced demand from the military. Despite efforts
to reduce costs and improve operating efficiency, the company
faced a liquidity squeeze. The company had no bank lines and was
totally dependent on internally generated cash flow for liquidity,
S&P noted.


HAMPTON ROADS: Closes on $50MM Private Placement of Common Stock
----------------------------------------------------------------
Hampton Roads Bankshares, Inc., issued an aggregate 71,428,572
common shares at a price of $0.70 per share to Anchorage Capital
Group, L.L.C., CapGen Capital Group VI LP and The Carlyle Group
pursuant to the terms of a standby purchase agreement between the
Investors and the Company.

The Company plans to raise an additional approximately $30 million
to $45 million in capital by issuing from 42,836,460 to 64,285,714
common shares in a public rights offering that it expects to
undertake during the third quarter of 2012.  In the Rights
Offering, the Company will grant each of its shareholders other
than the Investors non-transferable rights to purchase up to, but
no more than, a pro rata share of the maximum $95 million in
capital to be raised in the Private Placement and the Rights
Offering.  The rights will be distributed to shareholders of
record as of May 31, 2012, and may be exercised at $0.70 per
share, the same price per share paid by the Investors in the
Private Placement.  The Rights Offering will commence upon the
registration statement for the Rights Offering shares being
declared effective by the Securities and Exchange Commission.

The Investors have agreed not to participate in the Rights
Offering and have agreed to serve as standby purchasers of all or
a portion of the shares offered but not purchased in the Rights
Offering.  The number of shares the Investors purchase as standby
purchasers and the ultimate size of the combined capital raise
will depend on the level of shareholder participation in the
Rights Offering.

In addition, the Investors have terminated warrants they hold to
purchase 1,836,302 shares of the Company's common stock at a
current exercise price, subject to adjustment, of $10.00 per
share.

The Company expects to use the proceeds from the Private Placement
and Rights Offering for general corporate purposes, which will
include, but not be limited to, making capital contributions to
its banking subsidiaries.

                   About Hampton Roads Bankshares

Hampton Roads Bankshares, Inc. (NASDAQ: HMPR) --
http://www.hamptonroadsbanksharesinc.com/-- is a bank holding
company that was formed in 2001 and is headquartered in Norfolk,
Virginia.  The Company's primary subsidiaries are Bank of Hampton
Roads, which opened for business in 1987, and Shore Bank, which
opened in 1961.  Currently, Bank of Hampton Roads operates twenty-
eight banking offices in the Hampton Roads region of southeastern
Virginia and twenty-four offices in Virginia and North Carolina
doing business as Gateway Bank & Trust Co.  Shore Bank serves the
Eastern Shore of Maryland and Virginia through eight banking
offices and fifteen ATMs.

Effective June 17, 2010, the Company and its banking subsidiary,
Bank of Hampton Roads ("BOHR"), entered into a written agreement
with the Federal Reserve Bank of Richmond and the Bureau of
Financial Institutions of the Virginia State Corporation
Commission.  The Company's other banking subsidiary, Shore Bank,
is not a party to the Written Agreement.

Under the terms of the Written Agreement, among other things, BOHR
agreed to develop and submit for approval plans to (a) strengthen
board oversight of management and BOHR's operations, (b)
strengthen credit risk management policies, (c) improve BOHR's
position with respect to loans, relationships, or other assets in
excess of $2.5 million which are now, or may in the future become,
past due more than 90 days, are on BOHR's problem loan list, or
adversely classified in any report of examination of BOHR, (d)
review and revise, as appropriate, current policy and maintain
sound processes for determining, documenting, and recording an
adequate allowance for loan and lease losses, (e) improve
management of BOHR's liquidity position and funds management
policies, (f) provide contingency planning that accounts for
adverse scenarios and identifies and quantifies available sources
of liquidity for each scenario, (g) reduce the Bank's reliance on
brokered deposits, and (h) improve BOHR's earnings and overall
condition.

The Company reported a net loss of $98 million in 2011, compared
with a net loss of $210.35 million in 2010.

The Company's balance sheet at March 31, 2012, showed $2.13
billion in total assets, $2.02 billion in total liabilities and
$105.29 million in total shareholders' equity.


HEARTHSTONE HOMES: Panel's Deadline to Fight Disband Motion Moved
-----------------------------------------------------------------
The U.S. Bankruptcy Court approved a stipulation that extends to
July 2 the deadline for the official committee of unsecured
creditors in the Hearthstone Homes, Inc. bankruptcy case and the
U.S. Trustee to file an objection or respond to the request of C.
Randel Lewis, the Chapter 11 trustee, to disband the committee.

The Chapter 11 Trustee's request to disband was reported in the
June 5, 2012 edition of the Troubled Company Reporter.

The Committee was appointed on March 2, 2012.  The Court entered
an order appointing the Chapter 11 Trustee on March 21.

The Chapter 11 Trustee filed on April 17 the Debtor's schedules
and statement of affairs.  Each member of the Committee is
scheduled as holding a secured claim to the extent it claims a
construction lien on the 40 new homes which are the subject of the
Chapter 11 Trustee's motion to sell free and clear.

The Chapter 11 Trustee said the continuation of the Committee is
no longer necessary or proper in the Chapter 11 case because,
among other things:

  (a) the Committee's role and duties in this case are duplicative
      of those of the Trustee and are, thus, unnecessary;

  (b) the Trustee is capable of adequately representing the
      interests of unsecured creditors in this case;

  (c) the continuation of the Committee will create substantial
      unnecessary administrative expenses to be borne by the
      bankruptcy estate in this case;

  (d) each member of the Committee in fact claims a security
      interest in some or all of the proceeds to be realized from
      the sale of the 40 properties containing homes in progress
      all to the detriment of the unsecured creditors of this
      estate.

According to the Chapter 11 Trustee, the Committee continues to
interfere with the Trustee's orderly administration of this case.
On May 16, 2012, the Committee filed an objection to the Trustee's
motion to sell free and clear of liens, claims and encumbrances.
The Committee demands an allocation of the purchase price of the
40 homes being sold stating that: "Without such valid allocation
and/or statement of intention as to the disposition of the sale
proceeds to provide for payment to the construction lien creditors
who may have a lien on only one or two of the properties, it is
impossible for the lien creditor to determine whether they have a
basis to challenge the purchase price."

The Trustee says that the properties being conveyed are only
partially completed and with the Wells Fargo's mortgages have
total lien claims asserted against them well in excess of the sale
proceeds.  Unsecured creditors, according to the Trustee, would
have no interest as "lien creditors" in an allocation of the
purchase price in as much as there is no equity in any of the
properties containing the 40 partially completed homes which the
Trustee seeks to sell in bulk pursuant to the sales motion.  "Yet
this objection by the Committee in its official capacity
supposedly representing unsecured creditors requires the Trustee's
time and the resources of the Bankruptcy Estate to respond and
needlessly burdens the Estate," the Trustee states.

                      About Hearthstone Homes

Hearthstone Homes, Inc., filed a Chapter 11 petition in Omaha,
Nebraska (Bankr. D. Neb. Case No. 12-80348) on Feb. 24, 2012.
ketv.com reported that Hearthstone Homes filed for Chapter 11
bankruptcy protection after a deal to sell the company fell
through.  Hearthstone Homes' principal business activities have
been the purchase, development and sale of residential real
property for 40 years.

Chief Judge Thomas L. Saladino presides over the case.  The Debtor
is represented by Robert F. Craig, P.C.  Hearthstone estimated
assets and debts of $10 million to $50 million as of the Chapter
11 filing.

Wells Fargo N.A., the primary lender, is represented by lawyers at
Croker Huck Kasher DeWitt Anderson & Gonderinger LLC.

The U.S. Trustee appointed seven unsecured creditors to serve on
the Official Committee of Unsecured Creditors.


HRK HOLDINGS: Manatee County Property Owner Files in Tampa
----------------------------------------------------------
Palmetto, Florida-based HRK Holdings, LLC, filed a bare-bones
Chapter 11 petition (Bankr. M.D. Fla. Case No. 12-09868) in Tampa
on June 27, 2012.

The Debtor estimated assets and liabilities of $10 million to
$50 million.

The Debtor, according to court filings, owns real property in
Manatee County that accommodates a phosphogypsum stack system, a
portion of which is used as an alternate disposal area for the
management of dredge materials pursuant to a contract with Port
Manatee and as authorized under an administrative agreement with
the Florida Department of Environmental Protection.  The property
is directly east of the entrance to Port Manatee adjacent to the
east side of U.S. Highway 41.

The Debtor acquired the Property from the Chapter 7 trustee of
Mulberry Phosphate Company, the parent of Piney Point Phosphates,
Inc.  Until 2001, Piney Point owned and operated a fertilizer
manufacturing plant, which was abandoned upon the filing of the
Mulberry Chapter 7 case.

The Debtor is represented by Barbara A Hart, Esq., at Stichter,
Riedel, Blain & Prosser, in Tampa.


INTELLIGRATED INC: S&P Affirms 'B' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on Ohio-based automated materials-handling systems
provider Intelligrated Inc. The outlook is stable.

"At the same time, we assigned a 'B' issue rating and '3' recovery
rating to the company's proposed new $250 million first-lien
credit facility (comprising a $215 million term loan due 2019 and
a $35 million revolver due 2017). The '3' recovery rating
indicates our expectation of a meaningful (50%-70%) recovery in a
payment default scenario. We also assigned our 'CCC+' issue rating
and '6' recovery rating to the company's proposed new $90 million
second-lien credit facility due 2020. The '6' recovery rating
indicates our expectation of negligible (0%-10%) recovery in a
payment default scenario," S&P said.

"The issue and recovery ratings on the existing $155 million
senior secured credit facility will be withdrawn on the loan upon
repayment of the facility," S&P said.

"The affirmation of the corporate credit rating on Intelligrated
primarily reflects its 'highly leveraged' financial risk profile,
which more than offsets its 'weak' business risk profile," S&P
said.

"We expect Intelligrated's credit measures to improve modestly in
2012 with help from moderate organic growth, cost savings, and
EBITDA margins above 10%," said Standard & Poor's credit analyst
Carol Hom.

"Intelligrated is one of two leading materials-handling solutions
providers, and holds roughly 25% of the $1.6 billion niche North
American market. The company designs, manufactures, installs, and
services automated material-handling systems (conveyor belts,
sortation products, and warehouse control software) for a variety
of end markets: retail distribution, food and beverage, parcel-
handling, pharmaceutical, direct-to-consumer, e-commerce, and
related sectors. Revenues come from three core business segments:
distribution and fulfillment (60% of revenues in 2011),
manufacturing systems (19%), and customer service and other (21%).
Intelligrated will be owned by funds advised by private-equity
firm Permira Advisers LLC," S&P said.

"We believe Intelligrated will continue to benefit from its large
installed base in North America that, given the high costs
associated with switching systems providers, should support
customer retention. We believe its customer base is fairly
diverse, and it should continue to benefit from its long-standing
customer relationships through its product offerings and customer
service business," S&P said.

"We expect overall revenue growth for 2012 to be similar to our
economist's current view of U.S. equipment spending of about 7%.
We believe Intelligrated's financial risk profile will remain
highly leveraged," S&P said.


LDK SOLAR: Incurs $177 Million Net Loss in First Quarter
--------------------------------------------------------
LDK Solar Co., Ltd., reported a net loss of US$177.15 million on
US$200.10 million of net sales for the three months ended
March 31, 2012, compared with a net loss of US$564.55 million on
US$420.16 million of net sales for the quarter ended Dec. 31,
2011.

The Company's balance sheet at March 31, 2012, showed US$6.63
billion in total assets, US$5.96 billion in total liabilities,
US$228.21 million in redeemable non-controlling interests and
US$447.32 million in total equity.

"Our revenue was within the expected range as our results
reflected first quarter seasonality and the continued difficult
solar industry conditions," stated Xiaofeng Peng, Chairman and CEO
of LDK Solar.  "Industry-wide overcapacity continued and drove
price declines across the entire solar supply chain, which
significantly reduced our revenue and negatively impacted our
margins."

A copy of the press release is available for free at:

                        http://is.gd/qEXd75

                          About LDK Solar

LDK Solar Co., Ltd. -- http://www.ldksolar.com-- based in Hi-Tech
Industrial Park, Xinyu City, Jiangxi Province, People's Republic
of China, is a vertically integrated manufacturer of photovoltaic
products, including high-quality and low-cost polysilicon, solar
wafers, cells, modules, systems, power projects and solutions.

LDK Solar was incorporated in the Cayman Islands on May 1, 2006,
by LDK New Energy, a British Virgin Islands company wholly owned
by Xiaofeng Peng, LDK's founder, chairman and chief executive
officer, to acquire all of the equity interests in Jiangxi LDK
Solar from Suzhou Liouxin Industry Co., Ltd., and Liouxin
Industrial Limited.

KPMG in Hong Kong, China, said in a May 15, 2012, audit report
there is substantial doubt on the ability of LDK Solar Co., Ltd.
to continue as a going concern.  According to KPMG, the Group has
a net working capital deficit and is restricted to incur
additional debt as it has not met a financial covenant ratio under
a long-term debt agreement as of Dec. 31, 2011.  These conditions
raise substantial doubt about the Group's ability to continue as a
going concern.


LIBERTY INTERACTIVE: Moody's Affirms B1 CFR, Rates QVC Notes Ba2
----------------------------------------------------------------
Moody's Investors Service affirmed Liberty Interactive Corporation
("LINTA") Corporate Family Rating at B1. Moody's also assigned a
Ba2 (LGD 2, 28%) rating to QVC., Inc. ("QVC") proposed $500
million senior secured notes due 2022. The rating outlook remains
stable. The SGL rating was unchanged at SGL-1.

The following ratings were affirmed and LGD assessments amended:

Liberty Interactive LLC

Corporate Family Rating at B1

Probability of Default Rating at B1

Senior unsecured notes at B3 (LGD5 82%) from (LGD 5 78%)

Senior unsecured exchangeable notes at B3 (LGD5 82%) from
(LGD 5 78%)

Speculative Grade Liquidity rating at SGL -- 1

QVC Inc. senior unsecured notes (various) at Ba2 (LGD 2 28%)
from (LGD 2 23%)

The following rating was assigned

QVC Inc.

$500 million of senior unsecured notes at Ba2 (LGD 2 28%)

Ratings Rationale

Proceeds from the new note offering are expected to be temporarily
used to repay amounts owed under QVC Inc.'s (unrated) $2.0 billion
revolving credit facility ($382 million drawn as of 3/31/2012).
This refinancing is also considered in the context of LINTA's
previously disclosed intentions to establish two 'tracker' stocks
at LINTA -- "Liberty Interactive" -- which will have attributed to
it QVC, the interests in LINTA's ecommerce companies as well as
its strategic stake in HSN, Inc. (Ba1/stable) - and Liberty
Ventures -- which will hold the companies non-consolidated non-
strategic stakes ( which had a market value of around $4.0 billion
as of March 31, 2012) and cash. As part of this establishment of
this new tracking stock structure, it expects that QVC's total
debt would increase to approximately $3.3-3.5 billion (compared to
approximately $2.4 billion as of March 31, 2012). Pro-forma for
the issuance of the new notes this indicates that QVC would likely
draw around $0.8-1.0 billion under the $2.0 billion revolving
credit facility.

The affirmation of the B1 rating of LINTA reflects the solid
revenue trends and high operating margins at QVC as well as the
companies solid overall liquidity profile. The B1 rating also
reflects the company's historically aggressive financial policies
and risks that assets held may be utilized in a manner to benefit
shareholders more than bondholders, though event risk is lower
following the significant disposals by the company over the past
couple years.

The B1 Corporate Family Rating reflects expectations that LINTA's
financial policies will remain aggressive. Debt/EBITDA for the LTM
period ending 3/31/12 (incorporating Moody's standard analytical
adjustments) is approximately 3.9 times, though it would increase
to approximately 4.4 times when QVC's debt increases to the
targeted $3.3-3.5 billion level as discussed above. Moody's also
notes QVC's debt could increase further -- it has a public target
range of debt/EBITDA (using the company's definition which does
not incorporate Moody's adjustments) of 2.0-2.5 times and the
company will be just under 2 times on a pro-forma basis. As such,
the company has an estimated $800 million of debt capacity while
remaining within its public targets, which could result in
adjusted leverage approaching the high four times.

The stable rating outlook reflects Moody's expectation that LINTA
will more actively pursue opportunistic transactions including
share repurchases. Moody's also expects Liberty to retain a solid
liquidity position and that the QVC business will continue to show
stable performance, notwithstanding economic pressures in Europe
where the company has a meaningful exposure.

The ratings could be downgraded if liquidity weakens, the asset
composition or risk profile meaningfully changes, QVC's operating
performance deteriorates meaningfully, or debt-to-EBITDA is
sustained above 6.25x.

LINTA's ratings could be upgraded if debt-to-EBITDA is sustained
in a low 4x range or lower factoring in potential opportunistic
transactions, that revenue and operating performance is stable or
growing, and liquidity remains healthy. Permanent reduction in the
company's non-QVC debt instruments would be positive as well.

The principal methodology used in rating Liberty Interactive
Corporation was the Global Retail Industry Methodology published
in June 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.


LIGHTSQUARED INC: Falcone, Harbinger Sued for Securities Fraud
--------------------------------------------------------------
The Securities and Exchange Commission on Wednesday filed fraud
charges against New York-based hedge fund adviser Philip A.
Falcone and his advisory firm, Harbinger Capital Partners LLC for
illicit conduct that included misappropriation of client assets,
market manipulation, and betraying clients.  The SEC also charged
Peter A. Jenson, Harbinger's former Chief Operating Officer, for
aiding and abetting the misappropriation scheme.  Additionally,
the SEC reached a settlement with Harbinger for unlawful trading.

In a separate, settled action, the SEC charged Harbert Management
Corporation, whose affiliates served as the managing members of
two Harbinger-related entities, as a controlling person in the
market manipulation.

The SEC alleges that Falcone used fund assets to pay his taxes,
conducted an illegal "short squeeze" to manipulate bond prices,
secretly favored certain customers at the expense of others, and
that Harbinger unlawfully bought equity securities in a public
offering, after having sold short the same security during a
restricted period.

"T[he] charges read like the final exam in a graduate school
course in how to operate a hedge fund unlawfully," said Robert
Khuzami, Director of the SEC's Division of Enforcement.  "Clients
and market participants alike were victimized as Falcone
unscrupulously used fund assets to pay his personal taxes,
manipulated the market for certain bonds, favored some clients at
the expense of others, and violated trading rules intended to
prohibit manipulative short sales."

The SEC filed actions in U.S. District Court for the Southern
District of New York against Falcone, Jenson, and Harbinger, and,
in connection with the illegal trading scheme, separately
instituted and settled administrative and cease-and-desist
proceedings against Harbinger.

In particular, the SEC alleges that:

     -- Falcone fraudulently obtained $113.2 million from a
        hedge fund that he advised and misappropriated the
        proceeds to pay his personal taxes;

     -- Falcone and two Harbinger investment managers through
        which Falcone operated manipulated the price and
        availability of a series of distressed high-yield bonds
        by engaging in an illegal "short squeeze;"

     -- Falcone and Harbinger secretly offered and granted
        favorable redemption and liquidity rights to certain
        strategically-important investors in exchange for those
        investors' consent to restrict redemption rights of other
        fund investors, and concealed the arrangement from the
        fund's directors and investors; and

     -- Harbinger engaged in illegal trades in connection with
        the purchase of common stock in three public offerings
        after having sold the same securities short during a
        restricted period.

"Not only are hedge fund managers expected to be savvy investors,
they are supposed to serve the interests of their clients. Here,
in addition to raiding a fund for personal benefit and cutting
secret deals with favored investors, Falcone then lied to
investors about what he had done," said Bruce Karpati, Chief of
the Asset Management Unit in the SEC's Division of Enforcement.

Describing the illegal short squeeze, Gerald W. Hodgkins,
Associate Director of the SEC's Division of Enforcement said,
"After he took control of an entire issue of high-yield bonds,
Falcone kept buying with an eye toward rigging the market and
punishing short sellers to settle a score. In the process, Falcone
hijacked the market for the bonds and illegally manipulated their
price and availability. The Division will continue to police the
bond market to make sure it operates as an efficient market, free
of the corrosive effects of manipulators such as Falcone."

                      Misappropriation Scheme

In the misappropriation scheme, the SEC alleges that Falcone
unlawfully used fund assets to pay his personal taxes. In 2009
Falcone owed federal and state authorities $113.2 million in
taxes. Declining to pursue other financing options, such as
pledging his personal assets as collateral for a bank loan,
Falcone elected instead to take a $113.2 million loan from the
Harbinger Capital Partners Special Situations Fund, L.P. -- the
same fund from which Harbinger had earlier suspended investors
from redeeming.

Falcone authorized the transfer of fund assets to himself in a
transaction that Jenson helped structure. Falcone and Harbinger
never sought or obtained consent from investors prior to using the
fund's assets to benefit Falcone.

As part of the misappropriation scheme, the SEC alleges that
Falcone and Harbinger, aided by Jenson, made several material
misrepresentations and omissions in seeking legal advice regarding
the loan and in subsequent communications with investors,
including, among other things:

     -- the financing alternatives available to Falcone;

     -- the circumstances that led to Falcone's need for the loan;

     -- the ability of the Special Situations Fund to furnish the
        loan, without disadvantaging investors;

     -- the terms and conditions of the loan, including the
        interest rate charged and the amount of collateral posted
        by Falcone; and

     -- the role of Harbinger's outside legal counsel in vetting
        the transaction.

The SEC also alleges that Falcone and Harbinger delayed disclosing
the loan for approximately five months because of their concern
that disclosure of Falcone's financial condition might have a
negative impact on investor withdrawals and on Falcone's ability
to attract more investments for other Harbinger funds. Falcone
repaid the loan in 2011, after the Commission commenced its
investigation.

             Market Manipulation/Illegal Short Squeeze

In a separate civil action, the SEC alleges that from 2006 through
early 2008 Falcone and two Harbinger investment management
entities manipulated the market in a series of distressed high-
yield bonds issued by MAAX Holdings Inc. In this fraudulent
scheme, Falcone and the Harbinger entities allegedly orchestrated
an illegal "short squeeze" -- a market manipulation scheme in
which an investor constricts the supply of a security, through
large purchases or other means, with the intent of forcing
settlement from short sellers at arbitrary and inflated prices.

The SEC's complaint alleges that at Falcone's direction, Harbinger
purchased a large position in the MAAX bonds during April and June
of 2006. After hearing rumors that a Wall Street financial
services firm was shorting the MAAX bonds and also encouraging its
customers to do the same, Falcone decided to seek revenge. In
September 2006, Falcone directed the Harbinger-managed funds to
buy every available bond in the market, often purchasing the bonds
from short sellers. Ultimately, Falcone raised the funds' stake to
approximately 13% more than the available supply of the MAAX
bonds.

At one point, Harbinger had purchased 22 million more bonds than
MAAX had ever issued. Contemporaneously with these purchases,
Falcone locked up the MAAX bonds the Harbinger funds had purchased
in a custodial account at a bank in Georgia to prevent his brokers
from lending out the bonds to sellers seeking to deliver the bonds
to purchasers after short sales.

Having seized control of the supply of the MAAX bonds, Falcone
then demanded that the Wall Street firm and its customers settle
their outstanding MAAX short sales, not disclosing that it would
be virtually impossible to find bonds available for delivery. The
Wall Street firm bid daily for the bonds, which quickly doubled in
price. Then, Falcone engaged in a series of transactions with
certain short sellers at arbitrary, inflated prices, while at the
same time valuing the funds' holdings on his books at a small
fraction of the prices he charged the covering short sellers.
Preferential Redemption Scheme

In its action alleging misappropriation, the SEC also alleges that
in a further breach of Falcone and Harbinger's fiduciary duties to
their clients, Falcone and Harbinger engaged in unlawful
preferential redemptions for the benefit of certain favored
investors.

In 2009, while soliciting required investor approval to restrict
withdrawals from another Harbinger fund, Falcone and Harbinger
secretly exempted certain large investors that Falcone deemed to
be strategically important from soon-to-be imposed liquidity
restrictions -- provided those investors voted to approve
restrictions that would temporarily stabilize the decline in
Harbinger's assets under management.

Ultimately, pursuant to these 'vote buying' agreements, Falcone
and Harbinger allegedly permitted these investors who were
connected to certain favored institutional investors to withdraw a
total of approximately $169 million. Harbinger concealed these
quid pro quo arrangements from the independent directors and from
fund investors.

                 Other Illegal Trading by Harbinger

In a separate administrative and cease-and-desist proceeding, the
SEC found that between April and June 2009, Harbinger violated
Rule 105 of Regulation M of the Securities Exchange Act of 1934
(Exchange Act).  Rule 105 is an anti-manipulation rule that
prohibits short selling securities during a restricted period and
then purchasing the same securities in a public offering.

The Commission's Order censures Harbinger and requires the firm to
cease and desist from committing or causing any violations of Rule
105 now or in the future. Harbinger will pay disgorgement in the
amount of $857,950, prejudgment interest in the amount of $91,838,
and a civil monetary penalty in the amount of $428,975. Harbinger
consented to the issuance of the Order without admitting or
denying any of the Commission's findings.

             Settlement with Harbert Management Company

In a separate complaint also filed in U.S. District Court for the
Southern District of New York, the SEC filed a settled civil
action against Harbert and two related investment entities -- HMC-
New York Inc. and HMC Investors, LLC -- for their role in the
illegal short squeeze.

The SEC alleges in its complaint against Harbert that during the
entire period of the short squeeze, Defendants Harbert, HMC-NY and
HMC Investors, directly or indirectly, possessed the power to
control Falcone and the investment managers through which he
operated. HMC-NY and HMC Investors, two entities controlled by
Harbert, served as the managing members of two limited liability
companies that acted as the general partners of the funds advised
by Falcone.

Harbert and its affiliates also provided hedge fund
administrative, legal, compliance, risk assessment and other
services to the funds. In these capacities, Harbert, HMC-NY and
HMC Investors knew of Falcone's trades in the MAAX bonds, but
failed to take appropriate steps to address Falcone's manipulative
conduct. The SEC charged the Harbert defendants as controlling
persons pursuant to Section 20(a) of the Exchange Act, alleging
that they are jointly and severally liable for Falcone's and the
Harbinger investment managers' violations of the antifraud
provisions of the Exchange Act.

Without admitting or denying the allegations of the complaint,
Defendants Harbert, HMC-NY and HMC Investors have agreed to pay a
civil penalty in the amount of $1 million. The Harbert defendants
also have consented to the entry of a judgment enjoining them from
violations of Section 10(b) of the Exchange Act and Rule 10b-5
thereunder. The proposed settlement with Harbert is subject to
approval by the court.

In the pending federal court actions concerning the first three
fraudulent schemes, the Commission seeks a variety of sanctions
and relief including injunctions against Falcone and Harbinger
from violations of the anti-fraud provisions of the Securities Act
of 1933, the Exchange Act, and the Investment Advisers Act of
1940.

In addition, the Commission seeks to enjoin Harbinger and Falcone
from controlling any person who violates the anti-fraud provisions
of the Exchange Act. As for monetary relief, the Commission seeks
disgorgement of ill-gotten gains, prejudgment interest, and civil
money penalties from Falcone and Harbinger. The Commission further
seeks to prohibit Falcone from serving as an officer and director
of any public company. Against Jenson, the Commission seeks to
enjoin Jenson from aiding and abetting future violations of the
anti-fraud provisions of the Exchange Act and Advisers Act and
seeks to obtain monetary penalties.

The SEC's investigation was a coordinated effort between teams
from the SEC's headquarters and the New York Regional Office,
including Conway T. Dodge, Jr., Robert C. Besse, Ken C. Joseph,
Mark Salzberg, Brian Fitzpatrick, and David Stoelting. Messrs.
Joseph, Salzberg, and Fitzpatrick are members of the Enforcement
Division's Asset Management Unit. Mr. Stoelting and David
Gottesman will lead the SEC's litigation team.

                           *     *     *

Juliet Chung, writing for The Wall Street Journal, reports Mr.
Falcone, 49, declined to comment.  His lawyer, Matthew Dontzin,
Esq., said the allegations are "without merit and will all be
vigorously defended in the courthouse."

WSJ relates Mr. Dontzin said the fraud allegation is
"unsupportable" and that the loan "was obtained after receiving
considered written legal advice from a leading national law firm
on the basis of fully disclosed facts."

WSJ also reports the attorney for Peter A. Jenson, Harbinger's
former Chief Operating Officer, declined to comment.

WSJ also relates the SEC said in its complaint that Mr. Falcone
and Harbinger also favored some of their biggest investors with
"side deals" that would allow them to withdraw money more easily
from the firm.  In return, the investors agreed to vote in support
of a restructuring plan that would limit other clients' ability to
pull their funds, the SEC said.

According to WSJ, people familiar with the matter said the three
investors, which weren't named in the complaint, were Goldman
Sachs Group Inc., Pacific Alternative Asset Management Company LLC
and HSBC Holdings' private bank.  The investors haven't been
accused of wrongdoing; spokesmen for the firms declined to
comment.

"We are pleased to put this legacy matter behind us," a Harbert
spokesman said, according to WSJ.  Harbinger and Harbert ended
their relationship in 2009, according to the spokesman.

                        About LightSquared

LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, as the Company seeks to resolve regulatory issues
that have prevented it from building its coast-to-coast integrated
satellite 4G wireless network.

LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network.  In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries.  In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.

LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties,
prompting the bankruptcy filing.

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.

LightSquared also sought 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.

Judge Shelley C. Chapman presides over the Chapter 11 case.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors.  Kurtzman Carson Consultants LLC serves as claims and
notice agent.

Counsel to UBS AG as agent under the October 2010 facility is
Melissa S. Alwang, Esq., at Latham & Watkins LLP.

The ad hoc secured group of lenders under the Debtors' October
2010 facility was formed in April 2012 to negotiate an out-of-
court restructuring.  The members are Appaloosa Management L.P.;
Capital Research and Management Company; Fortress Investment
Group; Knighthead Capital Management LLC; and Redwood Capital
Management.  Counsel to the ad hoc secured group is Thomas E.
Lauria, Esq., at White & Case LLP.

Philip Falcone's Harbinger Capital Partners indirectly owns 96% of
LightSquared's outstanding common stock.  Harbinger 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., at Weil, Gotshal & Manges LLP.


LONG ISLAND RUBBISH: Judge Grossman Replaces Eisenberg
------------------------------------------------------
Judge Dorothy Eisenberg has been removed from the involuntary
Chapter 11 case filed against Long Island Rubbish Removal Eastern
Corp. due to a related case In re Anthony Farino (Bankr. E.D.N.Y.
Case No. 12-73869) filed June 21, 2012.  Judge Robert Grossman
will take her spot.

Winters Bros. Holdings, LLC, of West Bay Shore, New York, filed an
involuntary Chapter 11 petition against Long Island Rubbish
Removal Eastern Corp. (Bankr. E.D.N.Y. Case No. 12-73870) in
Central Islip on June 21, 2012.  Winters Bros. is represented by
the Law Offices of Raymond A. Giusto, P.C.


LUMBER PRODUCTS: Rugby Acquires All Assets Under Section 363 Sale
-----------------------------------------------------------------
Rich Christianson at Closets Daily reports Rugby Architectural
Building Products said it acquired substantially all of the assets
of Lumber Products through a stalking horse bid under Section 363
of the U.S. Bankruptcy Code.  The purchase includes seven former
Lumber Products locations in Tualatin and Eugene, OR; Kent and
Spokane, WA; Boise, ID, Salt Lake City, UT; Albuquerque, NM, plus
Lumber Products' distribution center in Chandler, AZ.  All of the
properties have assumed the Rugby name and the distribution center
will be consolidate with Rugby's Phoenix operation into a new
metro center.

According to the report, the buy out of Lumber Products represents
Rugby's ninth acquisition since 2010.  Since then, the company
said it has more than doubled its revenue base and grown to 20
distribution centers across the country.

"The acquisition of Lumber Products supports our strategy to
diversify geographically, extending Rugby's footprint into key
western markets," the report quotes David Hughes, Rugby president
and CEO, as saying.  "Furthermore, the transaction enhances our
product offerings in our core industrial base of products, as well
as increases our value-added components and service offerings
targeted at the commercial and residential construction sector."

Rugby is owned by Leading Ridge Capital Partners, a private equity
firm, with offices in Maryland and New York, specializing in
acquisitions, recapitalizations, and investments in value-added
distribution, logistics, and light manufacturing companies in the
lower-middle market.

                       About Lumber Products

Lumber Products -- http://www.lumberproducts.com/-- is a
wholesale distributor of some of the finest hardwood lumber,
hardwood plywood, and door and millwork products to the Northwest,
Intermountain, and Southwest states since 1938.  It has
headquarters in Tualatin, Oregon, and operations in Oregon,
Washington, Idaho, Montana, Utah, Arizona, and New Mexico.  Lumber
Products is the sole owner of Lumber Products Holding and
Management Company.  Holdco is the sole owner of: Lumber Products
Holding and Management Company; Sunrise Wood Products, Inc.;
Lumber Products Washington, Inc.; Components & Millwork, Inc.;
Wood Window Distributors, Inc.; D&J Wood Resources, Inc.; and
Brady International Hardwoods Company.

Lumber Products filed for Chapter 11 bankruptcy (Bankr. D. Ore.
Case No. 12-32729) on April 11, 2012, listing under $50 million in
assets and debts.  Judge Elizabeth L. Perris presides over the
case.  The petition was signed by Craig Hall, president and chief
operating officer.

The Debtor owes Wells Fargo in excess of $22.8 million.  Wells
Fargo is represented by Lane Powell PC.

Edward C. Hostmann, the Chapter 11 trustee, is represented by
Tonkon Torp LLP.


LYMAN LUMBER: Has Green Light to Hire Real Estate Counsel
---------------------------------------------------------
Lyman Lumber Company sought and obtained permission from the U.S.
Bankruptcy Court to employ Real Property Law Group as real estate
counsel.

Real Property Law Group will advise the Debtors on Washington
foreclosure law and other local legal standards that will impact
the Debtors' treatment of their properties in Woodinville and
Longview, Washington under a plan of liquidation.

The Debtors may also call on Real Property Law Group to provide
other legal services with respect to sale or disposition of the
properties if such matters arise.  The Debtors estimate that the
engagement may require no more than several hours of work by the
Real Property Law Group, though that may increase depending on
developments with respect to the properties.

The firm's Kathleen J. Hopkins will lead the engagement.  Ms.
Hopkins' hourly rate is $350 and other professionals at her firm
also bill at $350 per hour.

Ms. Hopkins attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.

                       About Lyman Lumber

Lyman Lumber Company sells building supplies, such as framing
beams, roofing materials, siding and drywall to residential
builders.  The 113-year old company and several affiliates sought
Chapter 11 petition (Bankr. D. Minn. Lead Case No. 11-45190) on
Aug. 4, 2011.  Judge Dennis O'Brien presides over the cases.
Lyman Lumber estimated $50 million to $100 million in assets and
$100 million to $500 million in debts.  The petition was signed by
James E. Hurd, president and chief executive officer.

The affiliates that filed for Chapter 11 are: Lyman Holding
Company; Automated Building Components, Inc.; Building Material
Wholesalers; Carpentry Contractors Corp.; Construction Mortgage
Investors Co.; Lyman Development Co.; Lyman Lumber of Wisconsin,
Inc.; Lyman properties LLC; Mid-America Cedar, Inc.; Woodinville
Lumber, Inc.; and Woodinville Construction Services LLC.

Cynthia A. Moyer, Esq., Douglas W. Kassebaum, Esq., James L.
Baillie, Esq., and Sarah M. Gibbs, Esq., at Fredrikson &
Bryon, P.A., serve as the Debtors' bankruptcy counsel.  BGA
Management, LLC d/b/a Alliance Management, developed and executed
a sale process and marketing strategy for the Debtors' assets.

The Official Committee of Unsecured Creditors of Lyman Lumber
Company tapped Fafinsky, Mark & Johnson, P.A., as its counsel.
Alliance Management is the turnaround consultant.  Conway
MacKenzie, Inc. is the panel's financial advisor.

When they filed for bankruptcy, the Debtors had in hand a term
sheet with SP Asset Management, LLC, a unit of Steel Partners
Holdings L.P., to serve as stalking horse bidder for the assets of
the Debtors.  New York City-based Steel Partners is a diversified
holding company that owns and operates businesses in a variety of
industries.

At an October 2011 auction, SP Asset Management and two other
bidders lost to BlackEagle Partners.  BlackEagle acquired the
Debtors' Midwest operations, including its Chanhassen location,
Automated Building Components, Carpentry Contractors Corp., and
Lyman Lumber of Wisconsin.  BlackEagle paid roughly $23 million.
The transaction was effective Oct. 28, 2011.

BlackEagle Partners owns US LBM Holdings, a collection of eight
building products distributors serving the Midwest, Northeast, and
Mid-Atlantic in nine states with more than 40 locations.

Edward C. Hostmann has been appointed as Chapter 11 trustee in the
case.


MARIANA RETIREMENT: Won't Appeal Case Dismissal Order
-----------------------------------------------------
Haidee V. Eugenio at Saipian Tribune reports that NMI Retirement
Fund administrator Richard Villagomez told Senate and House of
Representatives members that the pension agency is not appealing a
federal judge's dismissal of the Fund's Chapter 11 bankruptcy
petition, to the relief of some lawmakers, although some remain
skeptic.  According to the report, as far as lawmakers were
concerned, this was the first time Mr. Villagomez made such
statement that the Fund will not appeal the bankruptcy petition
dismissal.

                     About NMI Retirement Fund

The Northern Mariana Islands Retirement Fund --
http://www.nmiretirement.com/-- is a public corporation of the
Commonwealth of the Northern Mariana Islands that receives and
invests retirement contributions and pays certain benefits to or
on account of certain retirees of the Commonwealth government,
their survivors, and certain disabled persons.

The Fund, through its administrator Richard Villagomez, filed a
Chapter 11 bankruptcy petition in the U.S. District Court for the
Northern District of Mariana Islands in Saipan (Case No. 12-00003)
on April 17, 2012.

The Fund is represented by Brown Rudnick LLP and the Law Office of
Braddock J. Huesman, LLC.

The Fund said in court papers that the Chapter 11 filing was
precipitated by the discrepancy between the Debtor's current
ability to pay benefits to beneficiaries and the Debtor's current
obligations to those same beneficiaries.  The Fund said it would
exhaust its cash by July 2014.  It has been unable to collect a
$325 million judgment against the islands' government, and the
commonwealth decided to reduce contributions toward workers'
pensions.

As a result of continuous underfunding, which necessitated
withdrawing from its portfolio to cover funding shortfalls, the
value of the Fund's assets has fallen from $353,475,412 in 2009 to
its current level of $268,448,997, the Debtor's counsel has said.
The counsel also said the Fund is subject to liabilities (both
current and actuarial) totaling about $911 million.

An official committee of unsecured creditors, consisting of Fund
members, has been appointed in the case.

U.S. Bankruptcy Judge Robert J. Faris held a hearing on June 1,
2012, where he said from the bench that the fund isn't eligible
for Chapter 11 because it's an agent of the commonwealth
government.  The judge, however, said he won't formally dismiss
the case until July or August.


MARITIME SERVICES: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Maritime Services Corp.
        dba ProBuild Construction LLC
        dba Craft and Design LLC
        dba Maritime Services Corp UK
        3457 Guignard Drive
        Hood River, OR 97031-8603

Bankruptcy Case No.: 12-34978

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       District of Oregon

Judge: Randall L. Dunn

Debtor's Counsel: Joseph A. Field, Esq.
                  621 SW Morrison St #1225
                  Portland, OR 97205
                  Tel: (503) 228-9115
                  E-mail: joe@fieldjerger.com

Scheduled Assets: $3,999,859

Scheduled Liabilities: $7,505,821

A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/orb12-34978.pdf

The petition was signed by George Selfridge, CEO.


MF GLOBAL: Canadian Settlement Brings $60.6 Million
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee liquidating MF Global Inc. is seeking
approval of a settlement to generate $60.6 million for customers
with foreign accounts.  The trustee for the Canadian affiliate was
making a $43 million claim against the U.S. broker for funds held
for its customers.  At the same time, the U.S. broker was seeking
$103.6 million which the Canadian trustee admitted were segregated
for customers.  The two claims will be offset, generating $60.6
million for distribution to customers of the U.S. brokerage if the
bankruptcy judge in New York approves the settlement at a July 11
hearing.

                          About MF Global

New York-based MF Global (NYSE: MF) -- http://www.mfglobal.com/--
is one of the world's leading brokers of commodities and listed
derivatives.  MF Global provides access to more than 70 exchanges
around the world.  The firm is also one of 22 primary dealers
authorized to trade U.S. government securities with the Federal
Reserve Bank of New York.  MF Global's roots go back nearly 230
years to a sugar brokerage on the banks of the Thames River in
London.

MF Global Holdings Ltd. and MF Global Finance USA Inc. filed
voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059
and 11-5058) on Oct. 31, 2011, after a planned sale to Interactive
Brokers Group collapsed.  As of Sept. 30, 2011, MF Global had
$41,046,594,000 in total assets and $39,683,915,000 in total
liabilities.  It is easily the largest bankruptcy filing so far
this year.

Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel.  The Garden City Group, Inc., serves as
claims and noticing agent.  The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.

The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers.  James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act.  He is a partner at Hughes
Hubbard & Reed LLP in New York.

Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.

U.S. regulators are investigating about $633 million missing from
MF Global customer accounts, a person briefed on the matter said
Nov. 3, according to Bloomberg News.

Bankruptcy Creditors' Service, Inc., publishes MF GLOBAL
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by MF Global Holdings and other insolvency and
bankruptcy proceedings undertaken by its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


MMRGLOBAL INC: Extends Maturity of RHL Group Note for One Year
--------------------------------------------------------------
MMRGlobal, Inc., MyMedicalRecords, Inc., (MMR) and The RHL Group,
Inc., on June 22, 2012, entered into a Sixth Amended and Restated
Promissory Note, effective as of April 29, 2012.  The Amended Note
amends and restates that certain Fifth Amended and Restated
Promissory Note, effective April 29, 2011, by extending the
maturity date of the Existing Note for one year to April 29, 2013.
The Amended Note does not materially alter the terms of the
Existing Note other than for the fact that there were no loan
origination fees charged by The RHL Group on this renewal.

The RHL Group is a significant stockholder of the Company and is
wholly-owned by Robert H. Lorsch, Chairman, Chief Executive
Officer and President of the Company and of MMR.  Historically,
the Existing Notess have, over time, increased the maximum amount
of MMR's obligations in earlier notes from $100,000 to $1,000,000
to $3,000,000.  The maximum amount of the Amended Note remains at
$3,000,000.  The Amended Note continues to bear interest at the
lesser of 10% or the highest rate then permitted by law, and is
secured by a Security Agreement, which has been in effect since
July 31, 2007, and has been renewed and amended from time to time
in connection with the amendments and renewals of the Credit
Facility.  The Amended Note has a balance of $1,426,100, and a
total Unpaid Balance, which includes guarantees and unpaid
consulting fees, of $2,301,100.  In connection with the Amended
Note, the Company has issued The RHL Group a warrant to purchase
2,852,200 shares of the Company common stock at $0.02 per share.

                     Sales of Equity Securities

On various dates between May 5, 2012, and June 25, 2012, the
Company entered into eleven different Convertible Promissory Notes
with eleven different unrelated third-parties for principal
amounts totaling $215,000.  The Notes bear interest at a rate of
6% per annum payable in cash or shares of common stock or a
combination of cash and shares of common stock.  The decision
whether to pay in cash, shares of common stock or combination of
both will be at the Company's sole discretion.  At any time from
and after the earliest to occur of:

   (i) the approval of the stockholder's of the Company of the
       increase in the authorized shares of the Company's common
       stock from 650,000,000 to 950,000,000; or

  (ii) the availability of sufficient unreserved shares, the
       Company will be entitled to convert any portion of the
       outstanding and unpaid conversion amount into fully paid
       and non-assessable shares of common stock.

If the Company were to elect to convert those Notes, a total of
10,750,000 shares would be issued upon conversion.

On June 22, 2012, the Company granted a total of 6,250,000 shares
of common stock at $0.02 per share as an incentive to eight
employees and three consultants for past and future services
rendered.  All shares vest on Jan. 22, 2013, and are forfeitable
before that time.

On June 22, 2012, the Company granted a total of 19,884,775 shares
of common stock to four board members, two employees and two
consultants in exchange for a reduction in accounts payable in the
amount of $397,696 in total.  All shares vest on Jan. 22, 2013,
and are restricted before that time.

On June 22, 2012, the Company granted 2,852,200 warrants to
purchase shares of the Company's common stock to The RHL Group in
connection with the renewal of the Sixth Amended and Restated Line
of Credit Note.  This warrant has an exercise price of $0.02 per
share, with a contractual life through June 26, 2017, vests at
commencement and has an aggregate value of $57,044, which will be
recorded as interest expense.

The Company generally used the proceeds of the foregoing sales of
securities for repayment of indebtedness, working capital and
other general corporate purposes.

                      Annual Meeting Results

MMRGlobal, Inc., held its 2012 annual meeting of stockholders on
June 20, 2012, at the Beverly Wilshire, a Four Seasons Hotel,
located at 9500 Wilshire Boulevard, Beverly Hills, California.  At
the Annual Meeting, the Company's stockholders:

   (a) elected Mike Finley and Bernard Stolar to serve on the
       Company's Board of Directors as Class III directors for a
       term of three years expiring upon the Company's 2015 annual
       meeting of stockholders or until each of their respective
       successors are duly elected and qualified;

   (b) ratified the appointment of Rose Snyder & Jacobs as the
       Company's independent registered public accounting firm for
       the fiscal year ending Dec. 31, 2012;

   (c) approved the amendment to the Company's Amended and
       Restated Certificate of Incorporation, as amended as of the
       date of the Annual Meeting, to increase the authorized
       number of shares of the Company's common stock from 650
       million shares to 950 million shares; and

   (d) approved the adoption of the MMRGlobal, Inc., 2011 Equity
       Incentive Plan, which authorizes the issuance of a variety
       of equity awards, including stock options, stock purchase
       awards, stock bonus awards, stock appreciation rights,
       stock unit awards and other stock awards.

                          About MMRGlobal

Los Angeles, Calif.-based MMR Global, Inc. (OTC BB: MMRF)
-- http://www.mmrglobal.com/-- through its wholly-owned operating
subsidiary, MyMedicalRecords, Inc., provides secure and easy-to-
use online Personal Health Records (PHRs) and electronic safe
deposit box storage solutions, serving consumers, healthcare
professionals, employers, insurance companies, financial
institutions, and professional organizations and affinity groups.

In the auditors' report
accompanying the financial statements for year ended Dec. 31,
2011, Rose, Snyder & Jacobs LLP, in Encino,
California, expressed substantial doubt about the Company's
ability to continue as a going concern.  The independent auditors
noted that the Company has incurred significant operating losses
and negative cash flows from operations during the years ended
Dec. 31, 2011, and 2010.

The Company reported a net loss of $8.88 million in 2011, compared
with a net loss of $17.90 million in 2010.  The Company reported a
net loss of $10.3 million in 2009.

The Company's balance sheet at March 31, 2012, showed
$1.90 million in total assets, $7.96 million in total liabilities,
and a $6.05 million stockholders' deficit.


MOUNTAIN COUNTRY: Court Accepts Involuntary Chapter 11 Petition
---------------------------------------------------------------
Bankruptcy Judge Ronald O. Pearson officially placed Mountain
Country Partners, LLC, under Chapter 11 bankruptcy on Monday,
ruling that a group of investors who filed an involuntary petition
against the Company have standing to advance the involuntary
petition.  The Court cited the Company's inability to pay its debt
to the Petitioning Creditors.

MCP had opposed the petition.

Mountain Country Partners was formed to purchase the assets of
Buffalo Properties, LLC, an oil and gas company which was
previously a debtor in the U.S. Bankruptcy Court for the Southern
District of West Virginia.  A Bankruptcy Court auction occurred in
September 2006, and a representative of MCP bid $7,000,000 for the
estate assets.

Apparently, at the time of the bid, MCP did not have the purchase
monies on hand.  From September 2006, through November 2006, MCP
raised over $9.5 million from investors.  The investors purchased
promissory notes and limited partnership membership interests.
Most of the investors were persons who attended one of Ronald
LeGrand's real estate courses.  Mr. LeGrand is the managing member
of MCP.  The total amount invested by the Petitioning Creditors
was $1,882,812.

MCP had never filed a registration statement with the SEC.  The
investors received a one page promissory note that gave them the
option to withdraw their investment within 90 days and receive
125% times their investment or withdraw their investment after one
year and receive 150% times their investment or convert their
investment into shares and become a part owner of MCP.  An
$800,000 equity investment would convert to a 1% ownership
interest in the Company.  By comparison, Mr. LeGrand and the other
initial members paid nothing for their majority ownership
interests.

The Operating Agreement of MCP states that it is effective Oct.
10, 2006.  However, the agreement was not ready on that date and
was not provided to investors until several weeks later.  The
investors had already placed their money with MCP and by the time
the Operating Agreement was prepared checks were already deposited
in the MCP bank account.

The Initial Members of the company were Ronald F. LeGrand; Kenneth
Gwynn; Steve Rhodes; Ryan Cunningham; Frederick E. Wheat, Jr.; and
Katisha Hill.  None of those persons made any significant monetary
contribution for their membership interest.

In its ruling, the Court noted that the confidential financial
information provided by MCP shows that it lost $685,085 in 2011,
including non-cash expenses of $102,980 for depletion and $189,044
for depreciation.  MCP does not have sufficient resources to
rework the old wells.  MCP does not have the ability to raise new
capital.  MCP previously sold its Kentucky operations and the
funds from that sale have been expended.  Although MCP has based
its future upon oil production, as compared to gas production,
questions exist about the scope of the leases to allow the
drilling of new wells.  Further, MCP does not hold leases to the
Marcellus Shale formations.  Thus, it appears MCP does not have
the ability to pay the Petitioning Creditors on debts that became
due years ago.

A copy of the Court's June 25, 2012 Order is available at
http://is.gd/erkc5Gfrom Leagle.com.

Seven individual investors filed an involuntary Chapter 11
bankruptcy petition against Jacksonville, Florida-based Mountain
Country Partners, LLC (Bankr. S.D. W.Va. Case No. 12-20094) on
Feb. 17, 2012.  Judge Ronald G. Pearson presides over the case.
Joseph W. Caldwell, Esq., at Caldwell & Riffee, represent the
petitioners.


MOUNTAIN NATIONAL: Bank Now "Significantly Undercapitalized"
------------------------------------------------------------
The designation of Mountain National Bank was changed to
"significantly undercapitalized" effective upon the Bank's filing
of an amended Dec. 31, 2011, Report of Condition and Income with
its federal regulators on May 30, 2012, in which its tangible
equity capital ratio was 2.10%.  The Bank's tangible equity
capital ratio as of March 31, 2012, as reflected in its amended
Call Report filed with the federal regulators on June 14, 2012,
improved further to 2.45%.

As a result of no longer being designated as "critically
undercapitalized", the Bank is no longer required under applicable
Prompt Corrective Action regulations to be placed into
conservatorship or receivership within 90 days of that designation
under certain circumstances.  In addition, the Bank is no longer
prohibited by virtue of the FDIC's prompt corrective action
statute from:

    (i) entering into any material transaction other than in the
        usual course of business, including any investment,
        expansion, acquisition, sale of assets, or other similar
        action with respect to which the Bank is required to
        provide notice to its federal regulator;

   (ii) extending any credit for any highly leveraged
        transactions;

  (iii) amending the Bank's charter or bylaws, except to the
        extent necessary to carry out any other requirement of
        law, regulation, or order;

   (iv) making any material change in accounting methods;

    (v) engaging in any covered transaction as defined in Section
        23A(b) of the Federal Reserve Act (12 U.S.C. Section
        371c(b));

   (vi) paying excessive compensation or bonuses; and

   (vii) paying interest on new or renewed liabilities at a rate
         that would increase the Bank's weighted average cost of
         funds to a level significantly exceeding the prevailing
         rates of interest on insured deposits in the Bank's
         normal market areas.

The Bank remains, however, subject to other regulatory
restrictions prohibiting the acceptance, renewal or rolling over
of brokered deposits and the paying of interest on deposits above
certain national rate caps.

Notwithstanding the improvement in the Bank's designation for
Prompt Corrective Action purposes, the Bank remains obligated to
submit a capital restoration plan acceptable to its federal
regulator, which plan will be required to be guaranteed by the
Company.  The Company and the Bank continue to diligently work to
evaluate and pursue strategic alternatives, including, but not
limited to, the sale of common or preferred stock, the sale of all
or certain of the assets of the Bank or the Company or the merger
of the Bank or the Company with another financial institution or
its holding company.  There can be no assurance that the Company
or the Bank will be successful in obtaining outside additional
capital or merging with or being acquired by another company or
submitting an acceptable capital restoration plan.  There can also
be no assurance that the Bank's tangible equity capital ratio will
not in the future fall below 2%.

                      About Mountain National

Mountain National is a bank holding company registered with the
Board of Governors of the Federal Reserve System under the Bank
Holding Company Act of 1956, as amended.  The Company provides a
full range of banking services through its banking subsidiary,
Mountain National Bank.

The Company conducts its banking activities from its main office
located in Sevierville, Tennessee and through eight additional
branch offices in Sevier County, Tennessee, as well as a regional
headquarters and two branch offices in Blount County, Tennessee.

The Company's balance sheet at June 30, 2011, showed
$521.40 million in total assets, $509.90 million in total
liabilities, and stockholders equity of $11.50 million.

The Company and its principal subsidiary, Mountain National Bank,
are subject to various regulatory capital requirements
administered by the federal banking agencies.

In February 2010, the Bank agreed to an Office of the Comptroller
of the Currency ("OCC") minimum capital requirement ("IMCR") to
maintain a minimum Tier 1 capital to average assets ratio of 9%
and a minimum total capital to risk-weighted assets ratio of 13%.

The Bank had 4.61% of Tier 1 capital to average assets and 7.69%
of total risk-based capital to risk-weighted assets ratio at
June 30, 2011, and was therefore not in compliance with the IMCR.
As a result, the OCC may bring additional enforcement actions,
including a consent order or a capital directive, against the
Bank.

Based upon its capital levels at June 30, 2011, the Bank's capital
shortfall was approximately $23,374,000 for the Tier 1 capital to
average assets requirement and approximately $20,342,000 for the
total capital to risk-weighted assets requirement.


MP3TUNES LLC: CEO Not Covered by Automatic Stay in Chapter 7
------------------------------------------------------------
District Judge William H. Pauley, III, denied the request of
Michael Robertson to stay a copyright infringement action in view
of the bankruptcy filing by co-defendant MP3 tunes, LLC.  The
lawsuit is, CAPITOL RECORDS, INC. et al., Plaintiffs, v. MP3TUNES,
LLC et al., Defendants, No. 07 Civ. 9931 (S.D.N.Y.).

Mr. Robertson is MP3tunes' chief executive officer and sole
current employee.

MP3tunes filed a Chapter 7 petition for liquidation (Bankr. S.D.
Calif. Case No. 12-06037) on April 27, 2012.  In the Petition,
MP3tunes lists assets of $7,754 and liabilities totaling
$2,108,966.37.

Mr. Robertson argues that the automatic stay of the lawsuit should
be extended to him for three reasons: (1) MP3tunes is a necessary
party and this action cannot proceed without it, (2) the
Bankruptcy Trustee should have an opportunity to assess the claims
made against Robertson and their impact on the bankruptcy estate,
and (3) sections 362(a) and 105 of the Bankruptcy Code authorize
the District Court to stay the action.

The District Judge held that in general, automatic stays under the
Bankruptcy Code are limited to debtors and do not extend to
officers and principals of the debtor.  The Court also held that
Mr. Robertson has not shown any immediate adverse economic effect
or irreparable harm to the MP3tunes estate if the action continues
against him.  MP3tunes is a shell corporation with almost no
assets and will be liquidated in short-order.  Because MP3tunes
seeks liquidation under Chapter 7, and not reorganization under
Chapter 11, Mr. Robertson cannot articulate how continuing the
action against him could affect MP3 tunes' ability to reorganize.

"While Plaintiffs' claims against MP3tunes may survive Chapter 7
by operation of law, see 11 U.S.C. 727(a)(1), as a practical
matter, MP3tunes is no longer a going concern.  Accordingly, this
action should not be halted over the academic question of whether
the soon-defunct MP3tunes will be prejudiced if Plaintiffs' claims
against Robertson proceed," Judge Pauley said.

The Court directs the parties to submit a joint proposed case
management schedule by July 6, 2012.  Counsel for the parties are
further directed to participate in a telephone conference with the
Court on July 9 at 12:00 p.m., to discuss the proposed case
management schedule and set a trial date.  Plaintiffs are directed
to circulate a call-in number and a list of participants prior to
the call.

A copy of the District Court's June 25, 2012 Memorandum & Order is
available at http://is.gd/1BPAkKfrom Leagle.com.


NORTHAMPTON GENERATING: Gets Short Exclusivity Extension
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Northampton Generating Co. LP persuaded the
bankruptcy judge again to enlarge the time within which the
company has exclusive right to propose a reorganization plan.
Where Northampton wanted an enlargement of exclusivity by three
months to Sept. 30, the court in Charlotte, North Carolina, only
pushed the deadline out to Aug. 17.

                   About Northampton Generating

Northampton Generating Co. LP is the owner of a 112 megawatt
electric generating plant in Northampton, Pennsylvania.  The plant
is fueled with waste products, including waste coal, fiber waste,
and tires.  The power is sold under a long-term agreement to an
affiliate of FirstEnergy Corp.

Northampton Generating filed for Chapter 11 bankruptcy (Bankr.
W.D.N.C. Case No. 11-33095) on Dec. 5, 2011.  Hillary B. Crabtree,
Esq., and Luis Manuel Lluberas, Esq., at Moore & Van Allen PLLC,
in Charlotte, N.C., serve as counsel to the Debtors.  Houlihan
Lokey Capital, Inc., is the financial advisor.

The Debtor estimated assets and debts of up to $500 million.  Debt
includes $73.4 million owing on senior bonds issued through the
Pennsylvania Economic Development Financing Authority.

No request for the appointment of a trustee or examiner has been
made, and no statutory committee or trustee has been appointed in
this case.


NORTHSTAR AEROSPACE: Wins Court OK to Auction Assets
----------------------------------------------------
Northstar Aerospace (USA) Inc. and its Canadian parent will
conduct an auction in Chicago where private-equity investor
Wynnchurch Capital Ltd. will open the bidding with its $70 million
offer, pursuant to joint cross-border bidding procedures approved
by courts in Canada and the U.S.

U.S. Bankruptcy Judge Mary Walrath authorized the Debtors to
conduct an auction on July 17, 2012 at 10:00 a.m.  If no qualified
competing bids are submitted by July 13, the auction will be
cancelled.  There's a hearing on July 24 to approve the sale.
Absent higher and better offers, Northstar will seek court
approval to sell the business for $70 million cash to Wynnchurch.

Judge Walrath and her counterpart in Canada, Justice Geoffrey
Morowitz of the Ontario Superior Court, signed off on the bid
procedures at a joint hearing linked by video between Delaware and
Toronto, Lance Duroni at Bankruptcy Law360 reports.

Peg Brickley at Dow Jones' DBR Small Cap reports that
Philadelphia's Versa Capital Management has emerged as a potential
contender in the bidding for Northstar Aerospace.  In an
objection, Versa said that Wynnchurch's stalking horse bid appears
to be predicated on modified contracts with the Debtors' top
customer, Boeing Co., but the terms of the new deal have not been
disclosed.

The Pension Benefit Guaranty Corporation, according to
BankruptcyData.com, filed an objection to the proposed bidding
procedures.  The objection asserts, "First, the Joint Bidding
Procedures should be amended to require a statement as to whether
Pension Plan liability will be assumed by the bidder, and to
permit credit to be granted for any assumption of Pension Plan
liability. Through allowing this additional form of credit, a more
robust bidding process may occur, and the unsecured claim pool may
be less diluted. Second, the schedule for bidding is simply too
short."

                     About Northstar Aerospace

Chicago, Illinois-based Northstar Aerospace --
http://www.nsaero.com/-- is an independent manufacturer of flight
critical gears and transmissions.  With operating subsidiaries in
the United States and Canada, Northstar produces helicopter gears
and transmissions, accessory gearbox assemblies, rotorcraft drive
systems and other machined and fabricated parts.  It also provides
maintenance, repair and overhaul of components and transmissions.
Its plants are located in Chicago, Illinois; Phoenix, Arizona and
Milton and Windsor, Ontario.  Northstar employs over 700 people
across its operations.

Northstar Aerospace, along with affiliates, filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 12-11817) in Wilmington,
Delaware, on June 14, 2012, to sell its business to affiliates of
Wynnchurch Capital, Ltd., absent higher and better offers.

Attorneys at SNR Denton US LLP and Bayard, P.A. serve as counsel
to the Debtors.  The Debtors have obtained approval to hire Logan
& Co. Inc. as the claims and notice agent.

Certain Canadian affiliates are also seeking protection pursuant
to the Companies' Creditors Arrangement Act, R.S.C.1985, c. C-36,
as amended.

As of March 31, 2012, Northstar disclosed total assets of
$165.1 million and total liabilities of $147.1 million.
Approximately 60% of the assets and business are with the U.S.
debtors.


OASIS PETROLEUM: Moody's Lifts CFR to 'B2'; Rates New Notes 'B3'
---------------------------------------------------------------
Moody's Investors Service upgraded Oasis Petroleum Inc's (Oasis)
Corporate Family Rating (CFR) to B2 from B3, upgraded the rating
on the existing senior unsecured notes to B3 from Caa1, and
assigned a B3 rating to the company's proposed $300 million notes
due 2023. The outlook is stable. This concludes the review for
upgrade initiated on April 2, 2012.

"The upgrade of the CFR to B2 reflects the company's strong
returns due to a high proportion of oil production and modest
finding and development (F&D) costs, rapidly improving scale, and
a longer track record in the Williston Basin," commented Jonathan
Kalmanoff, Moody's Analyst.

Issuer: Oasis Petroleum Inc ,

  Upgrades:

     Probability of Default Rating, Upgraded to B2 from B3

     Corporate Family Rating, Upgraded to B2 from B3

     Multiple Seniority Shelf, Upgraded to (P)B3 from (P)Caa1

     Senior Unsecured Regular Bond/Debenture, Upgraded to B3 from
     Caa1

  Assignments:

     Senior Unsecured Regular Bond/Debenture, Assigned 65
     - LGD4 to B3

  Outlook Actions:

     Outlook, Changed To Stable From Rating Under Review

Ratings Rationale

The B2 CFR reflects the company's small but rapidly improving
scale relative to similarly rated peers, single basin
concentration, and relatively early stage of operations. The
rating is supported by very strong returns with oil representing
92% of production, a high quality Williston Basin asset base with
a large drilling inventory, and leverage which is low on a net
debt basis. Gross leverage is expected to decline as the company
deploys its large cash balance to fund production growth.

The B3 senior unsecured note rating reflects both the overall
probability of default of Oasis, to which Moody's assigns a PDR of
B2, and a loss given default of LGD4-65%. The size of the senior
secured revolver's priority claim relative to the senior unsecured
notes results in the notes being rated one notch beneath the B3
CFR under Moody's Loss Given Default Methodology.

The SGL-2 reflects good liquidity through the second quarter of
2013. While Moody's expects significant negative free cash flow,
the company's March 31, 2012 pro forma cash balance of $581
million and borrowing base credit facility availability of $500
million will provide sufficient liquidity. The credit facility,
which matures in 2016, has a total commitment of $1 billion and a
borrowing base of $500 million as of April 3, 2012, pro forma for
the proposed notes issuance. The borrowing base is subject to
redetermination twice per year in April and October. Financial
covenants under the facility are net debt to EBITDAX of no more
than 4.0x, and a current ratio of at least 1.0x, and Moody's
expects the company to remain well within compliance with these
covenants through the second quarter of 2013. There are no debt
maturities prior to 2016 when the credit facility matures.
Substantially all of the company's assets are pledged as
collateral for the revolving credit facility. Any asset sales with
proceeds in excess of 5% of the borrowing base then in effect
automatically reduce the borrowing base. Therefore, depending on
usage at the time, an asset sale may or may not provide additional
liquidity to Oasis.

Moody's could upgrade the ratings if average daily production
increases to 30 mboe/d, while maintaining a leveraged full-cycle
ratio (LFCR) of at least 2.5x, and reducing leverage (on a gross
debt basis) in line with expectations. Moody's could downgrade the
ratings if Oasis experiences a deterioration of operating
performance resulting in a LFCR below 2.0x, or if RCF / debt is
expected to be sustained below 20%.

The principal methodology used in rating Oasis Petroleum was the
Global Independent Exploration and Production 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.

Oasis Petroleum Inc. is an independent E&P company headquartered
in Houston, Texas.


OPTIMUMBANK HOLDINGS: Fails to Comply with Nasdaq Bid Price Rule
----------------------------------------------------------------
OptimumBank Holdings, Inc., received a letter from The Nasdaq
Stock Market indicating that the Company is not in compliance with
Listing Rule 5550(a)(2) because the closing bid price per share of
its common stock has been below $1.00 per share for 30 consecutive
business days.

In accordance with Listing Rule 5810(c)(3)(A), the Company has
been provided with a 180 calendar day grace period, or until
Dec. 17, 2012, to regain compliance with the Bid Price Rule.  To
regain compliance with the Bid Price Rule, the closing bid price
of the Company's common stock must remain at $1.00 per share or
more for a minimum of ten consecutive business days.

Thereafter, the Company can receive an additional 180-day grace
period if the Company meets the continued listing requirement for
market value of publicly held shares and all other initial listing
standards for The Nasdaq Capital Market, except for the bid price
requirement.  The Company must also notify Nasdaq of its intent to
cure the deficiency during the second grace period, by effecting a
reverse stock split, if necessary.  If the Company meets these
requirements, Nasdaq will grant the Company an additional 180
calendar days to regain compliance with the Bid Price Rule.
However, if it appears to Nasdaq that the Company will not be able
to cure the deficiency, or if the Company is otherwise not
eligible, Nasdaq will provide notice that the Company's securities
will be subject to delisting.  At that time, the Company may
appeal the delisting determination to a Hearings Panel.

The Company is evaluating its options to resolve the deficiency,
including a possible reverse stock split.

                    About OptimumBank Holdings

Fort Lauderdale, Fla.-based OptimumBank Holdings, Inc. is a
is a one-bank holding company and owns 100% of OptimumBank, a
state (Florida)-chartered commercial bank.  The Bank offers a
variety of community banking services to individual and corporate
customers through its three banking offices located in Broward
County, Florida.  The Bank's wholly-owned subsidiaries are OB Real
Estate Management, LLC, OB Real Estate Holdings, LLC, OB Real
Estate Holdings 1503, LLC, and OB Real Estate Holdings 1695, LLC,
all of which were formed in 2009.  OB Real Estate Management, LLC,
is primarily engaged in managing foreclosed real estate.  OB Real
Estate Holdings, LLC, OB Real Estate Holdings 1503, LLC, and OB
Real Estate Holdings 1695, LLC, hold and dispose of foreclosed
real estate.

The Company reported a net loss of $3.74 million in 2011, compared
with a net loss of $8.45 million in 2010.

The Company's balance sheet at March 31, 2012, showed $152.93
million in total assets, $144.76 million in total liabilities and
$8.17 million in total stockholders' equity.

                   Regulatory Enforcement Actions

On April 16, 2010, the Bank consented to the issuance of a Consent
Order by the Federal Deposit Insurance Corporation and the State
of Florida Office of Financial.  The Consent Order covers areas of
the Bank's operations that warrant improvement and imposes various
requirements and restrictions designed to address these areas,
including the requirement to maintain certain minimum capital
ratios.  Management believes that the Bank is currently in
substantial compliance with all the requirements of the Consent
Order except for the following requirements:

   * Scheduled reductions by Oct. 31, 2011, and April 30, 2012, of
     60% and 75%, respectively, of loans classified as substandard
     and doubtful in the 2009 FDIC Examination;

   * Retention of a qualified chief executive officer and chief
     lending officer; and

   * Development of a plan to reduce Bank's concentration in
     commercial real estate loans acceptable to the supervisory
     authorities.

The Bank has implemented comprehensive policies and plans to
address all of the requirements of the Consent Order and has
incorporated recommendations from the FDIC and OFR into these
policies and plans.


PAL CORPORATION: Case Summary & Largest Unsecured Creditor
----------------------------------------------------------
Debtor: PAL Corporation
        4014 North Wilson Drive
        Shorewood, WI 53211-1849

Bankruptcy Case No.: 12-29714

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Eastern District of Wisconsin (Milwaukee)

Debtor's Counsel: Jonathan V. Goodman, Esq.
                  LAW OFFICES OF JONATHAN V. GOODMAN
                  Suite 707, 788 North Jefferson Street
                  Milwaukee, WI 53202-3739
                  Tel: (414) 276-6760
                  Fax: (414) 287-1199
                  E-mail: jgoodman@ameritech.net

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $1,000,001 to $10,000,000

The Company's list of its 20 largest unsecured creditors has only
one entry:

Entity                   Nature of Claim        Claim Amount
------                   ---------------        ------------
Waste Management          Services               $1,000
Louisville, KY 40290-1054

The petition was signed by Arthur L. Post, president.


PETROPLUS HOLDINGS: JV to Convert Coryton Refinery Into Terminal
----------------------------------------------------------------
Karlee Weinmann at Bankruptcy Law360 reports that a U.K. oil
facility previously operated by now-insolvent Petroplus Holdings
AG will be refashioned into a terminal under a joint venture among
Shell UK Ltd., Royal Vopak and Greenergy, the companies said
Tuesday.

Bankruptcy Law360 relates that the announcement ends uncertainty
that has swirled around the Coryton refinery since its former
owner fell into bankruptcy in December, forcing refinery
administrator PricewaterhouseCoopers LLP to either find a buyer or
shut down the facility altogether.

                          About Petroplus

Based in Zug, Switzerland, Petroplus Holdings AG is one of
Europe's largest independent oil refiners.

Petroplus was forced to file for insolvency in late January after
struggling for months with weak demand due to the economic
slowdown in Europe and overcapacity amid tighter credit
conditions, high crude prices and competition from Asia and the
Middle East, MarketWatch said in a March 28 report.

According to MarketWatch, Petroplus said in March a local court
granted "ordinary composition proceedings" for a period of six
months. As part of the court process, Petroplus intends to sell
its assets to repay its creditors.

Some of Petroplus' units in countries other than Switzerland have
filed for "different types of proceedings" and are currently
controlled by court-appointed administrators or liquidators,
which started the process to sell assets, including the company's
refineries.


PHILADELPHIA ORCHESTRA: No Creditors Vote Against Plan
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when the Philadelphia Orchestra opens the June 29
confirmation hearing, the ensemble will report to the judge that
not a single creditor voted against approval of the Chapter 11
reorganization plan. If the judge approves the plan by signing a
confirmation order, it will allow the orchestra to exit from
bankruptcy begun in April 2011.

According to the report, the plan is based on settlements with the
musicians' union, the musicians' pension plan, the Pension Benefit
Guaranty Corp., and the Kimmel Center, where the orchestra
performs.  Donations from the orchestra's board will cover the
$5.49 million cost of the plan that extinguishes $100 million in
debt.

The report relates that the orchestra incurred $8.9 million in
professional fees and other costs while in Chapter 11.  The
orchestra has almost no secured debt. For the $35.5 million claim
resulting from termination of the existing musicians' pension
plan, the pension fund will receive a $1.75 million cash payment
under a settlement agreement. The PBGC receives $1.3 million in
installments.  General unsecured creditors are to receive 50
percent in cash on claims totaling about $555,000.

                 About Philadelphia Orchestra

The Philadelphia Orchestra -- http://www.philorch.org/-- claims
to be among the world's leading orchestras.  Bloomberg News says
the orchestra became the first major U.S. symphony to file for
bankruptcy protection, surprising the music world.

Previous conductors include Fritz Scheel (1900-07), Carl Pohlig
(1907-12), Leopold Stokowski (1912-41), Eugene Ormandy (1936-80),
Riccardo Muti (1980-92), Wolfgang Sawallisch (1993-2003), and
Christoph Eschenbach (2003-08). Charles Dutoit is currently chief
conductor, and Yannick Nezet-Seguin has assumed the title of music
director designate until he takes up the baton as The Philadelphia
Orchestra's next music director in 2012.

The Philadelphia Orchestra Association, Academy of Music of
Philadelphia, Inc., and Encore Series, Inc., filed separate
Chapter 11 petitions (Bankr. E.D. Pa. Case Nos. 11-13098 to
11-13100) on April 16, 2011. Judge Eric L. Frank presides over
the case.  The Philadelphia Orchestra Association is being advised
by Dilworth Paxson LLP, its legal counsel, and Alvarez & Marsal,
its financial advisor.  Curley, Hessinger & Johnsrud serves as its
special counsel.  Philadelphia Orchestra disclosed $15,950,020 in
assets and $704,033 in liabilities as of the Chapter 11 filing.

Encore Series, Inc., tapped EisnerAmper LLP as accountants and
financial advisors.

Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed
seven members to the official committee of unsecured creditors in
the Debtors' case. Reed Smith LLP serves as the Committee's
counsel.

The orchestra postpetition signed a new contract with musicians
and authority to terminate the existing musicians' pension plan.


PHOENIX PREMIER: Plan Lacks "Good Faith" Requirement
----------------------------------------------------
District Judge G. Murray Snow dismissed Phoenix Premier Properties
LLC's appeal from a bankruptcy court ruling that said the Debtors'
plan of reorganization lacks the good faith requirement and the
requirement of an accepting impaired class required by 11 U.S.C.
Sec. 1129(a)(3)." (Doc. 13 at 4-5; Doc. 14-1 at 3).

In affirming the Bankruptcy Court's decision, the District Court
held that, given the totality of the circumstances, it cannot say
the Bankruptcy Court committed clear error in its decision that
the Debtor's Plan lacked the good faith required under 11 U.S.C.
Sec. 1129(a)(3).

On Aug. 31, 2010, Phoenix Premier engaged Coleman & Deere as
prepetition counsel for various landlord tenant matters.  C&D was
incorporated on the same date.  C&D claims to have been unaware of
the planned bankruptcy proceedings, but required $5,000 up-front
at as an "evergreen retainer."  Phoenix Premier and C&D further
agreed at or about this time that C&D would invoice Phoenix
Premier for $1,000 in "earned fees," due immediately.  While
Phoenix Premier paid the "evergreen retainer," which C&D holds in
its trust account, Phoenix Premier never paid the $1,000.  This
$1,000 is C&D's only claim against Phoenix Premier.

Phoenix Premier filed a Plan of Reorganization, to which Federal
National Mortgage Association objected.  Following two subsequent
amended Plans of reorganization from Phoenix Premier, on Oct. 26,
2011, the Bankruptcy Court heard argument as to whether the Plan
was submitted in Good Faith.

The Debtor's Second Amended Plan identified seven classes of
creditors.  Class Three consisted of FNMA's secured, first
priority lien, and Class Four consisted of C&D's claim secured by
the amount held in trust.  When Phoenix Premier filed its "Report
of Ballots for Debtor's Plan of Reorganization Dated May 6, 2011,"
C&D was the only consenting impaired claim.

Under the Second Amended Plan, the terms of the proposed
impairment were that Phoenix Premier would pay half of C&D's claim
30 days after the effective date of the Plan, and the second half
60 days after, and waive a late fee and interest due on the late
amount.  In return, C&D "[would] release the $5,000.00 security
retainer being held in its trust account."

On Nov. 30, 2011 the Bankruptcy Court ruled on the Good Faith
Dispute, finding that "(i) the secured claim of Coleman & Deere,
PLC was the Debtor's only possible consenting impaired class in
the Bankruptcy Case, [and] (ii) that the secured claim of Coleman
& Deere, PLC could simply be offset by the retainer held by
Coleman & Deere, PLC."  As a result, the Court further ordered
that "Debtor's plan lacks the good faith requirement and the
requirement of an accepting impaired class required by 11 U.S.C.
Sec. 1129(a)(3)."

Phoenix Premier took an appeal.  FNMA elected to have the appeal
heard by the District Court.

The case before the District Court is, Phoenix Premier Properties
LLC, Debtor, Appellant, v. Federal National Mortgage Association,
aka Fannie Mae, Appellee, No. CV-12-187-PHX-GMS (D. Ariz.).  A
copy of the District Court's June 25, 2012 Order is available at
http://is.gd/TgfQYifrom Leagle.com.

Mesa, Arizona-based Phoenix Premier Properties LLC filed for
Chapter 11 bankruptcy (Bankr. D. Ariz. Case No. 10-28387) on
Sept. 3, 2010, estimated $1 million to $10 million in both assets
and debts.  Phoenix Premier owned a single piece of real property
valued variously at $3.2 million and $2.3 million.  The apartment
complex secured a $2,132,000 claim held by Federal National
Mortgage Association.  The FNMA loan came due in June 2010 and
Phoenix Premier was unable either to repay the loan or to find
lenders willing to refinance the property.  Judge Redfield T.
Baum, Sr. presides over the case.  Richard William Hundley, Esq.,
at Berens, Kozub & Kloberdanz, PLC, serves as the Debtor's
counsel.  The petition was signed by Vesna Djordjevich, member.


PLUM TV: Sells Business, Converts Case to Chapter 7
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Chapter 11 reorganization of Plum TV Inc. was
converted at the end of last week to a liquidation in Chapter 7
where a trustee was appointed.  The operator of television
stations in resort markets sold the business in April to Media
Greenhouse LLC for $1.17 million cash and debt assumption.

According to the report, the company said that the remaining
$100,000 isn't sufficient to pay the costs of the reorganization
case and permit confirming a Chapter 11 plan. There are as much as
$3 million in unsecured claims, according to court papers.

Plum TV, Inc. fdba Plum TV LLC, owner of television stations in
Colorado, eastern Long Island, New York; Martha's Vineyard and
Nantucket, Massachusetts; Miami and Idaho, filed a Chapter 11
petition (Bankr. S.D.N.Y. Case No. 12-10017) on Jan. 3, 2011, in
Manhattan.  Adam L. Rosen, Esq., at Silverman Acampora LLP, in
Jericho, New York, serves as counsel to the Debtor.  The Debtor
estimated up to $10 million in assets and up to $50 million in
liabilities as of Chapter 11 filing.


PREMIER PAVING: Creditors Can Hire Onsager Staelin as Counsel
-------------------------------------------------------------
The Unsecured Creditors' Committee of Premier Paving Inc. sought
and obtained approval from the U.S. Bankruptcy Court to retain
Onsager, Staelin & Guyerson, LLC as counsel.

The firm's rates are:

  Personnel                      Rates
  ---------                      -----
  Christian Onsager          $350 per hour
  Michael Guyerson           $325 per hour
  David Rich                 $300 per hour
  J. Brian Fletcher          $260 per hour
  Alice A. White             $250 per hour
  Andrew Johnson             $220 per hour
  David M. Little            $210 per hour
  Paralegal(s)               $100 per hour

Onsager, Staelin & Guyerson attests that the firm is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.

Denver, Colorado-based Premier Paving Inc. --
http://www.premierpavinginc.com/-- operates a full-service
highway construction company, which services include paving,
grading and milling, geo-textiles, trucking, traffic control and
quality control.  Premier Paving also owns and operates an asphalt
plant.

Premier Paving filed for Chapter 11 bankruptcy (Bankr. D. Colo.
Case No. 12-16445) on April 2, 2012.  Judge Michael E. Romero
presides over the case.  Lee M. Kutner, Esq., at Kutner Miller
Brinen, P.C., serves as the Debtor's counsel.  In its petition,
the Debtor estimated up to $50 million in assets and debts.  The
petition was signed by David Goold, treasurer.

A four-member Official Unsecured Creditors Committee has been
appointed in the case.


QVC INC: Fitch Assigns 'BB' Issuer Default Rating
-------------------------------------------------
Fitch Ratings has assigned a 'BBB-' rating to QVC, Inc.'s $500
million senior secured note offering due 2022.  Proceeds will be
used to reduce borrowings under the company's revolving bank
facility ($382 million outstanding) and for general corporate
purposes.  The notes will be secured and guaranteed on a pari
passu basis with QVC's existing $2 billion senior secured notes
and its $2 billion revolver.

For additional information regarding Liberty Interactive LLC
(Liberty) and QVC, please see Fitch's credit report published on
June 4, 2012.

QVC's notes (including the new offering) and bank revolver benefit
from a security interest in the capital stock of QVC and are
guaranteed by QVC's material domestic subsidiaries.  The secured
collateral may be removed as QVC's leverage has been below 2.0x
for two consecutive fiscal quarters, as permitted under the
company's credit agreement.  The collateral package, the equity of
QVC and the equity of QVC's material subsidiaries (released on
Feb. 16, 2011), would be reinstated for both the banks and the
senior notes in the event that LTM leverage exceeded 3.0x for two
consecutive quarters.  By maintaining the current collateral
(QVC's capital stock), QVC receives a 25 basis point benefit in
its revolver pricing.

The new notes are expected to have covenants and provisions
materially similar to the existing notes.  These provisions
include a 101% change of control offer which is triggered if more
than 30% of the voting power is acquired by a person other than a
Permitted Holder (as defined), such voting power exceeds the
voting power of the Permitted Holders, and QVC's secured notes are
rated non-investment grade.  Additional indebtedness is limited by
a 2x interest coverage incurrence test, with standard carve outs.
Total debt with the same security and guarantee package is limited
to $5 billion (consistent with the company's credit agreement).
The previously issued notes (due 2017, 2019 and 2020) limited pari
passu debt to $4.5 billion, which will be exhausted after this
issuance ($2 billion revolver and $2.5 billion in secured notes,
including this offering).

The recapitalization of Liberty Interactive Corp's (Liberty Corp.)
common stock, into Liberty Interactive and Liberty Ventures
tracking stock is expected to be completed by the end of the third
quarter.

As of March 31, 2012, Fitch calculates QVC's unadjusted gross
leverage (pro forma for the $500 million offering) at 1.7x and
Liberty's unadjusted gross leverage at 3.8x.

Liberty is expected to fund a portion of the initial cash balance
for Liberty Ventures with borrowings under QVC's revolver; Fitch
expects a QVC revolver balance of $1.3 billion to $1.5 billion.
Assuming a $1.5 billion QVC revolver balance, Fitch calculates QVC
and Liberty's unadjusted gross leverage at 2.3x and 4.4x
respectively.  While Liberty's leverage exceeds its 4x target,
Fitch believes EBITDA growth at QVC over the next 12 months and
upcoming Liberty maturities in 2013 will reduce Liberty's leverage
to 4x. QVC's EBITDA grew 4% in 2011 and 7% in the first quarter of
2012.

The ratings reflect Fitch's expectation that the company will
continue to manage leverage on a Liberty consolidated basis.  Over
the long term, Fitch expects Liberty's gross unadjusted leverage
to be managed within 4x and QVC unadjusted gross leverage to be
managed within 2.5x.

Fitch's IDRs for Liberty and QVC reflect the consolidated legal
entity/obligor credit profile, rather than the Liberty
Interactive/Venture tracking stock structure.  This view is
primarily driven by Fitch's interpretation of the Liberty bond
indentures.  Fitch believes that the company could not spin out
QVC without consent of the bondholders, based on the current asset
mix at Liberty.  QVC generates 86% and 95% of Liberty's revenues
and EBITDA, respectively.  In addition, Fitch believes QVC makes
up a meaningful portion of Liberty's equity value.  Any spin off
of QVC would likely trigger the 'substantially all' asset
disposition restriction within the Liberty indentures.

The 'BBB-' rating on the QVC bank facility and notes take into
account placement in the capital structure, giving it strong
recovery prospects.  QVC's individual business profile and credit
metrics would warrant an IDR greater than 'BB' on a standalone
basis.  Fitch expects that the ratings would remain unchanged in
the event that the remaining security is released.

Fitch believes liquidity at Liberty Interactive will be sufficient
to support operations and QVC's expansion into other markets.
Acquisitions and share buybacks are expected to be a primary use
of free cash flow (FCF).

Fitch believes that there is sufficient liquidity and cash
generation (from investment dividends and tax sharing between
Liberty Interactive and Liberty Ventures) to support debt service
and disciplined investment at Liberty Venture.

Key Rating Drivers:

  -- Fitch believes that the current financial policy is
     consistent with the current ratings. If the company were to
     manage to more conservative leverage targets, ratings may be
     upgraded.

  -- Conversely, changes to financial policy (including more
     aggressive leverage targets) and asset mix changes that
     weakened bondholder protection, could pressure the ratings.

Liquidity:

Consolidated liquidity at Liberty as of March 30, 2012, included
$794 million in cash and $1.6 billion available under the QVC $2
billion credit facility, which expires in September 2015.  Fitch
calculates FCF of approximately $800 million for the LTM ended
March 2012, excluding cash flows related to the spun-out Liberty
Starz/Capital assets.  Fitch expects FCF to be in the $725 million
to $825 million range in 2012.

In addition, the company's balance sheet includes approximately
$4.5 billion in public holdings.  Fitch believes these assets
could be liquidated in the event that Liberty LLC needed
additional liquidity.

Liberty LLC's near-term maturities include $1.1 billion of
exchangeable debentures that may be put to the company in 2013 and
approximately $309 million in senior notes maturing in 2013.
Fitch believes Liberty LLC has sufficient liquidity (including the
Time Warner basket of stocks) to handle these maturities.

Fitch rates Liberty and QVC as follows:

Liberty

  -- IDR at 'BB';
  -- Senior unsecured debt at 'BB'.

QVC

  -- IDR at 'BB';
  -- Senior secured debt at 'BBB-'.

The Rating Outlook is Stable.


RE LOANS: Court Confirms Modified Fourth Amended Plan
-----------------------------------------------------
Bankruptcy Judge Barbara J. Houser confirmed the Modified Fourth
Amended Joint Chapter 11 Plan of Reorganization, Dated June 1,
2012, filed by R.E. Loans LLC, R.E. Future LLC, and Capital
Salvage.  The Plan was negotiated at arm's-length among the
Debtors, the Official Committee of Noteholders, Wells Fargo
Capital Finance, and the Debtors' largest unsecured creditor, the
Liquidating Trust for Mortgage Fund '08 LLC, Development
Specialists, Inc., and their advisors.

The Court also approved the Debtors' entry into an exit credit
facility with Wells Fargo.

On the Plan effective date, Mackinac Partners LLC will serve as
manager of Reorganized R.E. Loans and R.E. Future and James A.
Weissenborn will serve as president and sole director of
Reorganized Capital Salvage.  Dennis Faulkner will serve as
trustee under the Liquidating Trust to be established under the
Plan.

The ruling says each of the Reorganized Debtors is barred and
enjoined from filing a voluntary petition under Chapter 7 or 11 of
the Bankruptcy Code prior to one year after the indefeasible
payment in full in cash of all obligations owing under the Wells
Fargo Exit Facility.

A copy of the Court's Findings of Fact, Conclusions of Law, and
Order Confirming Debtors' Modified Fourth Amended Joint Chapter 11
Plan of Reorganization, issued June 26, 2012, is available at
http://is.gd/8QbDvwfrom Leagle.com.

                         About R.E. Loans

R.E. Loans, LLC, was, for many years, in the business of providing
financing to home builders and developers of real property.  R.E.
Future LLC and Capital Salvage own the real property obtained
following foreclosure proceedings initiated by R.E. Loans against
its borrowers.  R.E. Loans is the sole shareholder of Capital
Salvage and the sole member of R.E. Future.  B-4 Partners LLC is
the sole member of R.E. Loans.  As a result of the multiple
defaults by R.E. Loans' borrowers, R.E. Loans has transitioned
from being a lender to becoming a property management company.

Lafayette, California-based R.E. Loans, R.E. Future and Capital
Salvage filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case
Nos. 11-35865, 11-35868 and 11-35869) on Sept. 13, 2011.  Judge
Barbara J. Houser presides over the case.  Stutman, Treister &
Glatt Professional Corporation, in Los Angeles, and Gardere, Wynne
Sewell LLP, in Dallas, represent the Debtors as counsel.  James A.
Weissenborn at Mackinac serves as R.E. Loans' chief restructuring
officer.  The Debtors tapped Hines Smith Carder as their
litigation and outside general counsel.  The Debtors tapped
Alixpartners, LLP as noticing agent, and Latham & Watkins LLP as
special counsel in real estate matters.  R.E. Loans disclosed
$713.6 million in assets and $886.0 million in liabilities as of
the Chapter 11 filing.

Akin Gump Strauss Hauer & Feld LLP, in Dallas, represents
the Official Committee of Noteholders.

The Debtors' Plan provides that the rights of the Noteholders and
the Holders of General Unsecured Claims will depend on whether the
Noteholders vote to accept the Plan and implement the Plan
Compromise.  No payments will be made by the Reorganized Debtors
on account of any Allowed Claims (other than Secured Tax Claims)
until the Wells Fargo Exit Facility is indefeasibly paid in full
in Cash.


RESIDENTIAL CAPITAL: Has Final Approval of $1.4BB Barclays Loan
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
permitted Residential Capital, LLC, and its debtor affiliates, on
a final basis, to borrow up to $1.45 billion in postpetition
secured superpriority financing from Barclays Bank PLC.

Under the Barclays DIP Loan, the Debtors can access up to:

   (i) $190,000,000 under the revolving loan facility;
  (ii) $1,060,000,000 under the A-1 term loan facility; and
(iii) $200,000,000 under the A-2 term loan facility.

In exchange, the DIP Lenders will be granted superpriority
expense claims.

Judge Glenn further held that upon a written request by the
Debtors, after consultation by the Debtors with the Official
Committee of Unsecured Creditors, the Administrative Agent agrees
to work with the Debtors and the Creditors' Committee to seek
amendments to the DIP Credit Agreement that would permit the
Debtors to consummate a sale of the portion of the Collateral
that is either (a) the Collateral that is the subject of the Ally
Sale Agreement or (b) the Collateral that is the subject of the
Nationstar Sale Agreement prior to consummating a sale of the
assets subject to the other Original Sale Agreement as defined in
the DIP Credit Agreement without requiring that the DIP
Obligations be paid in full upon consummation of such sale.

The Debtors further agree to promptly provide to counsel for the
Creditors' Committee copies of the invoices, redacted for
privilege as appropriate, received by the Debtors on account of
fees and expenses incurred by professionals retained by the
Administrative Agent as provided for in the Credit Documents.

Any objections to the Barclays DIP Motion or the supplemental
notice with respect to the entry of this final order that have
not been withdrawn, waived or settled, and all reservation of
rights included therein, are hereby denied and overruled, Judge
Glenn ruled.

With respect to the alleged rights of setoff and recoupment that
the Objecting MBS Trustees have asserted with respect to the
Receivables generated before the Petition Date, each Objecting
MBS Trustee will receive a superpriority administrative claim to
the extent it is determined by the Court that the Objecting MBS
Trustee has valid setoff rights.  That superpriority
administrative claim will be junior in priority and subordinate
to the Superpriority Claims granted to the Collateral Agent, the
Administrative Agent, and the DIP Lenders.

As to the Objecting MBS Trustees' alleged rights of setoff
against Receivables generated post-petition and alleged rights of
recoupment, the Objecting MBS Trustees will postpone the exercise
of any such rights until the full repayment of the DIP
Obligations.  The Objecting MBS Trustees are The Bank of New York
Mellon Trust Company, N.A., Deutsche Bank Trust Company Americas,
Deutsche Bank National Trust Company, U.S. Bank National
Association and Wells Fargo Bank, N.A.

Judge Glenn clarified that neither the Green Planet Servicing
Funds nor the GPS Loan Pool as defined in Green Planet Servicing,
LLC's Objection may be utilized in connection with or pledged as
collateral under the DIP Facilities.

A full-text copy of the Barclays DIP Final Order dated June 22,
2012, is available for free at:

   http://bankrupt.com/misc/ResCap_BarclaysDIPFinalOrd.pdf

                           About ResCap

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, 2012.

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 is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and 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.

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., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.

Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).


RESIDENTIAL CAPITAL: Wins Nod of $220-Mil. Ally Facility
--------------------------------------------------------
Judge Martin Glenn permitted Residential Capital LLC and its
affiliates, on a final basis, to borrow up to $220 million in
postpetition financing on a secured, superpriority basis from
parent, Ally Financial Inc.

Judge Glenn recognized that the Debtors need to obtain the full
amount of the financing available under the AFI DIP Loan in order
to permit the orderly continuation of the operation of their
businesses, including the continued funding of the GNMA Buyouts
to ensure their compliance with the Ginnie Mae Guide and maintain
their current issuer status.  Before the Petition Date, the
Debtors funded the repurchase of whole loans from Ginnie Mae
pools in order to, among other things, avoid GMAC Mortgage being
in violation of delinquency triggers applicable to it under
Chapter 18 of the Ginnie Mae Guide -- the GNMA Buyouts.

Pursuant to the Final AFI DIP Order, the Debtors are authorized
to borrow up to $220 million under the AFI DIP Loan; provided,
that the aggregate amount of AFI prepetition and postpetition
draws under the AFI Loan Agreement authorized under this final
order may not exceed $600 million.  The amount available under
the AFI DIP Loan will be $200 million, and any additional
borrowings in excess of $200 million will be made at the sole
discretion of AFI.  Ally will receive superiority administrative
expense claims in its capacity as the lender under the AFI DIP
Loan.

The Debtors also won final Court permission to use cash
collateral of AFI and the holders of the 9.625% Junior Secured
Notes Due 2015, solely for the purposes detailed within the
initial 20-week forecast of anticipated cash receipts and
disbursements as set forth in the Debtors' Motion.  The Debtors
will provide AFI and the holders with adequate protection for any
diminution in value of the collateral.

Judge Glenn clarifies that this final order will not modify or
affect the terms and provisions of, nor the rights and
obligations under:

  (a) the Board of Governors of the Federal Reserve System
      Consent Order, dated April 13, 2011, by and among AFI,
      Ally Bank, ResCap, GMAC Mortgage, LLC, the Board of
      Governors of the Federal Reserve System, and the Federal
      Deposit Insurance Corporation;

  (b) the consent judgment entered April 5, 2012 by the U.S.
      District Court for the District of Columbia, dated
      February 9, 2012;

  (c) the Order of Assessment of a Civil Money Penalty Issued
      Upon Consent Pursuant to the Federal Deposit Insurance
      Act, as amended, dated February 10, 2012; and

  (d) all related agreements with AFI and Ally Bank and their
      subsidiaries and affiliates.

Moreover, all rights of the Objecting MBS Trustees to challenge
the effect of paragraph 30 of the Interim Ally DIP Order,
including whether that provision was binding and effective upon
the Objecting MBS Trustees, are fully preserved.

Solely in connection with permitting the use of Prepetition
Collateral, including Cash Collateral, or exercising any rights
or remedies as and when permitted pursuant to the Ally DIP Final
Order or the Prepetition Obligations, the Adequate Protection
Parties will not be deemed, from and after the Petition Date, to
be in control of the operations of the Debtors or to be acting as
a "responsible person" or "owner or operator" with respect to the
operation or management of the Debtors so long as the Adequate
Protection Parties' actions do not constitute, within the meaning
of Section 9601(20)(F) of the U.S. Comprehensive Environmental
Response, Compensation and Liability Act.  Nothing in this final
order or the AFI DIP Loan will permit the Debtors to violate
Section 959(b) of Title 28 of the U.S. Code.   Likewise, nothing
in this final order will in any way be construed or interpreted
to impose or allow the imposition upon the Adequate Protection
Parties any liability for any claims arising from the prepetition
or postpetition activities of any of the Debtors and their
respective affiliates.

Judge Glenn also held that none of the Green Planet Servicing
Funds constitute property of the Debtors' estate, nor will the
Green Planet Servicing Funds, as defined in the objection of
Green Planet Servicing, LLC, constitute Cash Collateral.
Moreover, no rights of any entity under Sections 555, 556, 559,
560 and 561 of the Bankruptcy Code will be affected by the entry
of this final order as to any contract or transaction of the kind
listed in such sections of the Bankruptcy Code.

Any objection that has not been withdrawn or resolved is,
to the extent not resolved, hereby overruled, Judge Glenn ruled.

A full-text copy of the Final Ally DIP Order dated June 25, 2012,
is available for free at:

   http://bankrupt.com/misc/ResCap_AllyDIPFinalOrd.pdf

                           About ResCap

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, 2012.

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 is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and 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.

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., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.

Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).


RESIDENTIAL CAPITAL: Wins Approval to Use Cash Collateral
---------------------------------------------------------
Judge Martin Glenn authorized Residential Capital LLC and its
affiliates, on a final basis, to use the cash collateral of
Citibank N.A. under the Citibank MSR (mortgage servicing rights)
Facility, in accordance with a budget approved by Citibank, a copy
of which is available for free at:

    http://bankrupt.com/misc/ResCap_0620CashCollBudget.pdf

The Debtors are authorized to use the MSR Cash Collateral for the
period from the entry of this final order through the date that
is the earliest to occur of:

(a) the expiration of the remedies notice period;

(b) the date on which maturity of the DIP Facility is
    accelerated pursuant to the DIP Loan Agreement as a result
    of an event of default thereunder;

(c) the effective date of a Chapter 11 plan for any Debtor with
    Assets exceeding $10 million; or

(d) the initial scheduled date of maturity of the DIP Facility,
    up to a maximum of 18 months from the closing date of the
    DIP Facility.

The MSR Cash Collateral may be used during the specified period
solely (x) to fund the cash needs related to the operations and
assets of the assets that comprise the Prepetition MSR
Collateral, including funding advances or repurchase obligations
owed by the Debtors with respect to such Prepetition MSR
Collateral; and (y) to fund an allocated portion of the Debtors'
costs of administering these Chapter 11 cases based on the value
of the Prepetition MSR Collateral relative to the value of the
Debtors' other assets (any such MSR Cash Collateral used to pay
such allocated administrative costs.

As adequate protection of the interests of Citibank, Citibank
will be granted adequate protection liens and allowed
superpriority administrative expense claim.

Nothing in this final order will prejudice the rights of the
Official Committee of Unsecured Creditors to seek to avoid or
otherwise challenge the validity, extent, priority or perfection
of security interests, and liens of Citibank, Judge Glenn held.
The Creditors' Committee must commence, as appropriate, a
contested matter or adversary proceeding raising such claim,
objection or challenge within 120 days after entry of the final
order.

All objections to the Citibank Cash Collateral Motion to the
extent not withdrawn or resolved are withdrawn, the Court ruled.

A full-text copy of the Final Cash Collateral Order dated
June 20, 2012, is available for free at:

    http://bankrupt.com/misc/ResCap_CashCollFinalOrd.pdf

                           About ResCap

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, 2012.

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 is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and 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.

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., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.

Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS.  The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).


RITZ CAMERA: Crystal Finance DIP Facility Has Interim Approval
--------------------------------------------------------------
Ritz Camera & Image, LLC and Ritz Interactive LLC won an interim
order authorizing them to obtain secured, superpriority
postpetition financing, consisting of a revolving credit facility
of $15,585,000 and a term loan facility of $4,915,000, with
Crystal Financial LLC as administrative and collateral agent for
the DIP lenders.  Specifically, the Debtors are authorized to
request extensions of credit up to an aggregate principal amount
of $3,000,000 at any one time outstanding.

The Debtors also obtained permission to use cash collateral
securing their obligations to the pre-bankruptcy lenders.

The Debtors owe not less than $16.32 million in prepetition term
and revolving loans provided by secured lenders also led by
Crystal Finance LLC, as administrative agent.

The DIP credit agreement, among others, requires the Debtors to
continue to employ WeinsweigAdvisors LLC as restructuring
advisors.  The DIP lenders permit the Debtors to dispose of assets
in connection with a sale transaction that results in the
repayment of the loan in full in cash at the closing of the sale
transaction commencing no later than Sept. 14, 2012.  The
agreement caps any employment compensation to David M. Ritz to
$325,000 per annum.

The DIP facility also imposes these milestones:

     By 45 days after the     Borrowers must have obtained an
     petition date            extension of the deadline to assume
                              or reject leases to not less than
                              210 days from the petition date

     By July 6, 2012          Borrowers will have distributed an
                              information memorandum in connection
                              with a going concern sale

     By July 6, 2012          Borrowers will have filed a motion
                              seeking approval of bidding and
                              sale guidelines

     By July 31, 2012         Hearing held on sale guidelines

     By Aug. 3, 2012          Borrowers will have obtained
                              approval of sale guidelines

     By Aug. 6, 2012          Borrowers will have solicited bids
                              in connection with a going concern
                              sale or full chain liquidation

     By Aug. 16, 2012         Borrowers will have executed an
                              agency documents in connection with
                              selecting a stalking horse bidder

     By Sept. 6, 2012         Borrowers will have conducted an
                              auction for a going concern sale or
                              full chain liquidation

     By Sept. 10, 2012        Sale approval hearing

     By Sept. 14, 2012        Borrowers will have closed a deal

The Court will hold a final hearing July 17 at 3:00 p.m. on the
DIP financing.

Crystal Finance is represented in the case by:

         Robert A.J. Barry, Esq.
         MORGAN LEWIS & BOCKIUS LLP
         225 Franklin Street, 16th Floor
         Boston, MA 02110

              - and -

         Wendy S. Walker, Esq.
         MORGAN LEWIS & BOCKIUS LLP
         101 Park Avenue
         New York, NY 10178

              - and -

         Robert S. Brady, Esq.
         Edmon Morton, Esq.
         YOUNG CONAWAY STARGATT & TAYLOR LLP
         Rodney Square
         100 North King Street
         Wilmington, DE 19801

                         About Ritz Camera

Beltsville, Maryland-based Ritz Camera & Image LLC --
http://www.ritzcamera.com-- sells digital cameras and
accessories, and electronic products.  It sought Chapter 11
protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to
close unprofitable stores.  Ritz claims to be the largest camera
and image chain the U.S., operating 265 camera stores in 34 states
as well as an Internet business.  Ritz Camera intends to shut 128
locations and cut its staff in half.  Included in the closing are
10 locations in Maryland and 4 in Virginia.

Affiliate Ritz Interactive Inc., owner e-commerce Web sites that
include RitzCamera.com and BoatersWorld.com, also filed for
bankruptcy.

RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11
protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009.
Ritz generated $40 million by selling all 129 Boater's World
Marine Centers.  A group that included the company's chief
executive officer, David Ritz, formed Ritz Camera & Image to buy
at least 163 of the remaining 375 camera stores.  The group paid
$16.25 million in cash and a $7.8 million note.  Later, Ritz sold
a $4 million account receivable for $1.5 million to an owner of
the company that owed the debt.

In the 2009 petition, Ritz disclosed total assets of $277 million
and total debts of $172.1 million.  Lawyers at Cole, Schotz,
Meisel, Forman & Leonard, P.A., served as bankruptcy counsel.
Thomas & Libowitz, P.A., served as the Debtor's special corporate
counsel and conflicts counsel.  Marc S. Seinsweig, at FTI
Consulting, Inc., served as the Debtor's chief restructuring
officer.  Kurtzman Carson Consultants LLC acted as claims and
noticing agent.  Attorneys at Cooley Godward Kronish LLP and
Bifferato LLC represented the official committee of unsecured
creditors as counsel.

In April 2010, the Court approved a liquidating Chapter 11 plan
proposed by the company and the official creditor's committee.
Under the Plan, unsecured creditors were to recover 4% to 14% of
their claims.

In the 2012 petition, RCI estimated total assets and liabilities
of $50 million to $100 million.  The Debtors owe not less than
$16.32 million for term and revolving loans provided by secured
lenders led by Crystal Finance LLC, as administrative agent.

Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve
as bankruptcy counsel.  Kurtzman Carson Consultants LLC is the
claims agent.

WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as
Ritz's CRO.

Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at
Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon
Brothers Retail Partners LLC and Hilco Merchant Resources LLC.


RITZ CAMERA: Sec. 341 Creditors' Meeting Set for July 31
--------------------------------------------------------
Roberta A. DeAngelis, the United States Trustee for Region 3,
proposes to hold a Meeting of Creditors pursuant to 11 U.S.C. Sec.
341(a) of the bankruptcy cases of Ritz Camera & Image, L.L.C., et
al., on Tuesday, July 31, 2012, at 11:00 a.m.  The meeting will be
held at J. Caleb Boggs Federal Building, 2nd Floor, Room 2112.

Beltsville, Maryland-based Ritz Camera & Image LLC --
http://www.ritzcamera.com-- sells digital cameras and
accessories, and electronic products.  It sought Chapter 11
protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to
close unprofitable stores.  Ritz claims to be the largest camera
and image chain the U.S., operating 265 camera stores in 34 states
as well as an Internet business.  Ritz Camera intends to shut 128
locations and cut its staff in half.  Included in the closing are
10 locations in Maryland and 4 in Virginia.

Affiliate Ritz Interactive Inc., owner e-commerce Web sites that
include RitzCamera.com and BoatersWorld.com, also filed for
bankruptcy.

RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11
protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009.
Ritz generated $40 million by selling all 129 Boater's World
Marine Centers.  A group that included the company's chief
executive officer, David Ritz, formed Ritz Camera & Image to buy
at least 163 of the remaining 375 camera stores.  The group paid
$16.25 million in cash and a $7.8 million note.  Later, Ritz sold
a $4 million account receivable for $1.5 million to an owner of
the company that owed the debt.

In the 2009 petition, Ritz disclosed total assets of $277 million
and total debts of $172.1 million.  Lawyers at Cole, Schotz,
Meisel, Forman & Leonard, P.A., served as bankruptcy counsel.
Thomas & Libowitz, P.A., served as the Debtor's special corporate
counsel and conflicts counsel.  Marc S. Seinsweig, at FTI
Consulting, Inc., served as the Debtor's chief restructuring
officer.  Kurtzman Carson Consultants LLC acted as claims and
noticing agent.  Attorneys at Cooley Godward Kronish LLP and
Bifferato LLC represented the official committee of unsecured
creditors as counsel.

In April 2010, the Court approved a liquidating Chapter 11 plan
proposed by the company and the official creditor's committee.
Under the Plan, unsecured creditors were to recover 4% to 14% of
their claims.

In the 2012 petition, RCI estimated total assets and liabilities
of $50 million to $100 million.  The Debtors owe not less than
$16.32 million for term and revolving loans provided by secured
lenders led by Crystal Finance LLC, as administrative agent.

Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve
as bankruptcy counsel.  Kurtzman Carson Consultants LLC is the
claims agent.

WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as
Ritz's CRO.

Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at
Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon
Brothers Retail Partners LLC and Hilco Merchant Resources LLC.

Crystal Finance, the DIP lender, is represented by Morgan, Lewis &
Bockius and Young Conaway Stargatt & Taylor LLP.


RITZ CAMERA: Can Hire Kurtzman Carson as Claims Agent
-----------------------------------------------------
Ritz Camera & Image LLC sought and obtained authority from the
Court to employ Kurtzman Carson Consultants LLC as claims and
noticing agent.

KCC's Albert Kass attests that his firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code, and does not hold or represent an interest
materially adverse to the Debtors' estates.

Under the parties' services agreement, KCC will invoice the
Debtors monthly for services rendered to the Debtors during the
preceding month, except that if the total fees and expenses are
expected to exceed $10,000 in a single month, the Debtors may,
upon KCC's demand, make advance payment.

Prior to the petition date, the Debtors paid KCC a $15,000
retainer.

                         About Ritz Camera

Beltsville, Maryland-based Ritz Camera & Image LLC --
http://www.ritzcamera.com-- sells digital cameras and
accessories, and electronic products.  It sought Chapter 11
protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to
close unprofitable stores.  Ritz claims to be the largest camera
and image chain the U.S., operating 265 camera stores in 34 states
as well as an Internet business.  Ritz Camera intends to shut 128
locations and cut its staff in half.  Included in the closing are
10 locations in Maryland and 4 in Virginia.

Affiliate Ritz Interactive Inc., owner e-commerce Web sites that
include RitzCamera.com and BoatersWorld.com, also filed for
bankruptcy.

RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11
protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009.
Ritz generated $40 million by selling all 129 Boater's World
Marine Centers.  A group that included the company's chief
executive officer, David Ritz, formed Ritz Camera & Image to buy
at least 163 of the remaining 375 camera stores.  The group paid
$16.25 million in cash and a $7.8 million note.  Later, Ritz sold
a $4 million account receivable for $1.5 million to an owner of
the company that owed the debt.

In the 2009 petition, Ritz disclosed total assets of $277 million
and total debts of $172.1 million.  Lawyers at Cole, Schotz,
Meisel, Forman & Leonard, P.A., served as bankruptcy counsel.
Thomas & Libowitz, P.A., served as the Debtor's special corporate
counsel and conflicts counsel.  Marc S. Seinsweig, at FTI
Consulting, Inc., served as the Debtor's chief restructuring
officer.  Kurtzman Carson Consultants LLC acted as claims and
noticing agent.  Attorneys at Cooley Godward Kronish LLP and
Bifferato LLC represented the official committee of unsecured
creditors as counsel.

In April 2010, the Court approved a liquidating Chapter 11 plan
proposed by the company and the official creditor's committee.
Under the Plan, unsecured creditors were to recover 4% to 14% of
their claims.

In the 2012 petition, RCI estimated total assets and liabilities
of $50 million to $100 million.  The Debtors owe not less than
$16.32 million for term and revolving loans provided by secured
lenders led by Crystal Finance LLC, as administrative agent.

Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve
as bankruptcy counsel.  Kurtzman Carson Consultants LLC is the
claims agent.

WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as
Ritz's CRO.

Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at
Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon
Brothers Retail Partners LLC and Hilco Merchant Resources LLC.

Crystal Finance, the DIP lender, is represented by Morgan, Lewis &
Bockius and Young Conaway Stargatt & Taylor LLP.


RITZ CAMERA: DIP Lender, Kimco Realty Tap Morgan Lewis as Counsel
-----------------------------------------------------------------
Shopping center owner Kimco Realty Corporation has made an
appearance in the bankruptcy case of Ritz Camera & Image LLC.
Kimco is represented by:

          Neil E. Herman, Esq.
          MORGAN, LEWIS & BOCKIUS LLP
          101 Park Avenue
          New York, NY 10178
          Tel: (212) 309-6669
          E-mail: nherman@morganlewis.com

Morgan, Lewis & Bockius is also representing the Debtors' DIP
lender, Crystal Finance is represented in the case by:

         Robert A.J. Barry, Esq.
         MORGAN LEWIS & BOCKIUS LLP
         225 Franklin Street, 16th Floor
         Boston, MA 02110
         E-mail: rbarry@morganlewis.com

              - and -

         Wendy S. Walker, Esq.
         MORGAN LEWIS & BOCKIUS LLP
         101 Park Avenue
         New York, NY 10178
         E-mail: wwalker@morganlewis.com

              - and -

         Rachel Jaffe Mauceri, Esq.
         MORGAN LEWIS & BOCKIUS LLP
         1701 Market Street
         Philadelphia, PA 19103-2921

The DIP lender is also represented by Robert S. Brady, Esq., and
Edmon Morton, Esq., at Young Conaway Stargatt & Taylor LLP.

Another shopping center owner, Strawberry Village Retail LLC, also
made an appearance in the case.  It is represented by:

         Jeffrey H. Lowenthal, Esq.
         Robert W. Biederman, Esq.
         STEYER LOWENTHAL BOODROOKAS ALVAREZ & SMITH LLP
         One California Street, Third Floor
         San Francisco, CA 94111
         Telephone: (415) 421-3400
         Facsimile: (415) 421-2234
         Email: jlowenthal@steyerlaw.com
                Rbiederman@steyerlaw.com

Other creditors that made an appearance in the case include:

     * Brixmor Property Group, Inc., represented by David L.
       Pollack, Esq. -- pollack@ballardspahr.com ,
       blunt@ballardspahr.com

     * Cousins Properties Incorporated, represented by Dustin
       Parker Branch, Esq. -- dustin.branch@kattenlaw.com ,
       carole.levine@kattenlaw.com ; adelle.shafer@kattenlaw.com
       laura.nefsky@kattenlaw.com

     * GGP Limited Partnership, represented by Kristen N. Pate,
       Esq. -- ggpbk@ggp.com , ggpbk@ggp.com

     * Highland Park ISD represented by Elizabeth Banda Calvo,
       Esq. -- rgleason@pbfcm.com , ebcalvo@pbfcm.com

     * Simon Property Group, Inc., represented by Ronald Mark
       Tucker, Esq. -- rtucker@simon.com , bankruptcy@simon.com

     * Westfield, LLC, represented by Niclas A. Ferland, Esq. --
       niclas.ferland@leclairryan.com

As reported by the Troubled Company Reporter, Roberta A.
DeAngelis, United States Trustee for Region 3, will hold an
organizational meeting on July 2, 2012, at 11:00 a.m. in the
bankruptcy case of Ritz Camera.  The meeting will be held at The
DoubleTree Hotel in Wilmington Delaware.  The sole purpose of the
meeting will be to form a committee or committees of unsecured
creditors in the Debtors' cases.

                         About Ritz Camera

Beltsville, Maryland-based Ritz Camera & Image LLC --
http://www.ritzcamera.com-- sells digital cameras and
accessories, and electronic products.  It sought Chapter 11
protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to
close unprofitable stores.  Ritz claims to be the largest camera
and image chain the U.S., operating 265 camera stores in 34 states
as well as an Internet business.  Ritz Camera intends to shut 128
locations and cut its staff in half.  Included in the closing are
10 locations in Maryland and 4 in Virginia.

Affiliate Ritz Interactive Inc., owner e-commerce Web sites that
include RitzCamera.com and BoatersWorld.com, also filed for
bankruptcy.

RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11
protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009.
Ritz generated $40 million by selling all 129 Boater's World
Marine Centers.  A group that included the company's chief
executive officer, David Ritz, formed Ritz Camera & Image to buy
at least 163 of the remaining 375 camera stores.  The group paid
$16.25 million in cash and a $7.8 million note.  Later, Ritz sold
a $4 million account receivable for $1.5 million to an owner of
the company that owed the debt.

In the 2009 petition, Ritz disclosed total assets of $277 million
and total debts of $172.1 million.  Lawyers at Cole, Schotz,
Meisel, Forman & Leonard, P.A., served as bankruptcy counsel.
Thomas & Libowitz, P.A., served as the Debtor's special corporate
counsel and conflicts counsel.  Marc S. Seinsweig, at FTI
Consulting, Inc., served as the Debtor's chief restructuring
officer.  Kurtzman Carson Consultants LLC acted as claims and
noticing agent.  Attorneys at Cooley Godward Kronish LLP and
Bifferato LLC represented the official committee of unsecured
creditors as counsel.

In April 2010, the Court approved a liquidating Chapter 11 plan
proposed by the company and the official creditor's committee.
Under the Plan, unsecured creditors were to recover 4% to 14% of
their claims.

In the 2012 petition, RCI estimated total assets and liabilities
of $50 million to $100 million.  The Debtors owe not less than
$16.32 million for term and revolving loans provided by secured
lenders led by Crystal Finance LLC, as administrative agent.

Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve
as bankruptcy counsel.  Kurtzman Carson Consultants LLC is the
claims agent.

WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as
Ritz's CRO.

Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at
Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon
Brothers Retail Partners LLC and Hilco Merchant Resources LLC.


ROSETTA GENOMICS: NYSDOH Conditionally Approves miRview
-------------------------------------------------------
The New York State Department of Health has given Rosetta Genomics
conditional approval for its miRview lung assay for testing on
patient samples from the State.  New York is the only U.S. state
that requires an independent regulatory review process for
laboratory-developed tests.  With this approval, Rosetta Genomics
can offer miRview lung in all 50 U.S. states.  In making the assay
available pending final approval, the NYSDOH requires the Company
to provide any additional information they request within 60
business days. miRview lung is the Company's proprietary microRNA-
based assay that accurately identifies the four main subtypes of
lung cancer using small amounts of tumor cells.

"Lung cancer is the second most common cancer and is the primary
cause of cancer-related death in both men and women in the U.S.
With the introduction of targeted lung cancer therapies, such as
Avastin and Alimta, and with other targeted drugs entering the
clinical arena, accurate classification and subtyping of lung
cancer is becoming increasingly important to better assess
differential side effects and efficacy profiles and to enhance
treatment strategies," said Kenneth A. Berlin, President and Chief
Executive Officer of Rosetta Genomics.  "With a sensitivity of 95%
for very small sample sizes, such as cytological samples, we
believe this assay can be a useful tool for pathologists and we
are very pleased to have approval to market this important cancer
diagnostic for the benefit of physicians and patients in New
York."

                           About Rosetta

Located in Rehovot, Israel, Rosetta Genomics Ltd. is seeking to
develop and commercialize new diagnostic tests based on a recently
discovered group of genes known as microRNAs.  MicroRNAs are
naturally expressed, or produced, using instructions encoded in
DNA and are believed to play an important role in normal function
and in various pathologies.  The Company has established a CLIA-
certified laboratory in Philadelphia, which enables the Company to
develop, validate and commercialize its own diagnostic tests
applying its microRNA technology.

In its auditors' report for the 2011 financial statements, Kost
Forer Gabbay & Kasierer, in Tel-Aviv, Israel, expressed
substantial doubt about Rosetta Genomics' ability to continue as a
going concern.  The independent auditors noted that the Company
has incurred recurring operating losses and generated negative
cash flows from operating activities in each of the three years in
the period ended Dec. 31, 2011.

The Company reported a net loss after discontinued operations of
$8.83 million on $103,000 of revenues for 2011, compared with a
net loss after discontinued operations of $14.76 million on
$279,000 of revenues for 2010.

The Company's balance sheet at Dec. 31, 2011, showed $2.04 million
in total assets, $2.40 million in total liabilities, and a
stockholders' deficit of $356,000.

                         Bankruptcy Warning

The Company said in its annual report for the year ended Dec. 31,
2011, "We have used substantial funds to discover, develop and
protect our microRNA tests and technologies and will require
substantial additional funds to continue our operations.  Based on
our current operations, our existing funds, including the proceeds
from the January 2012 debt financing, will only be sufficient to
fund operations until late May, 2012.  We intend to seek funding
through collaborative arrangements and public or private equity
offerings and debt financings.  Additional funds may not be
available to us when needed on acceptable terms, or at all.  In
addition, the terms of any financing may adversely affect the
holdings or the rights of our existing shareholders.  For example,
if we raise additional funds by issuing equity securities, further
dilution to our then-existing shareholders may result.  Debt
financing, if available, may involve restrictive covenants that
could limit our flexibility in conducting future business
activities.  If we are unable to obtain funding on a timely basis,
we may be required to significantly curtail one or more of our
research or development programs.  We also could be required to
seek funds through arrangements with collaborators or others that
may require us to relinquish rights to some of our technologies,
tests or products in development or approved tests or products
that we would otherwise pursue on our own.  Our failure to raise
capital when needed will materially harm our business, financial
condition and results of operations, and may require us to seek
protection under the bankruptcy laws of Israel and the United
States."


RUDEN MCCLOSKY: Reiterates Buyer's Chapter 7 Objections
-------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reports that Ruden McClosky
PA on Wednesday echoed concerns raised by its planned purchaser,
Greenspoon Marder PA, over a possible conversion to Chapter 7
bankruptcy, saying the move would add unnecessary administrative
costs and delay payments to creditors.

Bankruptcy Law360 relates that Ruden McClosky's protest of
converting its bankruptcy from Chapter 11 rehashed many of the
same concerns raised a day earlier by Greenspoon in a separate
objection filed in Florida bankruptcy court, with both firms claim
the appointment of a Chapter 7 trustee would not only add costs.

                       About Ruden McClosky

Founded in 1959, Ruden McClosky P.A., fdba Ruden, McClosky, Smith,
Schuster & Russell, P.A. -- http://www.ruden.com/-- was a full-
service law firm serving the legal needs of clients throughout
Florida, the U.S., and internationally.  It had eight offices in
Florida.

In August 2011, the firm was reportedly in merger talks with
Cleveland, Ohio-based Benesch firm.  In September 2011, founder
Donald McClosky died after a long battle with cancer.

Ruden McClosky filed for Chapter 11 protection (Bankr. S.D. Fla.
Case No. 11-40603) on Nov. 1, 2011, in its hometown of Fort
Lauderdale, with a plan to sell a substantial portion of its
assets for $7.6 million to Fort Lauderdale-based Greenspoon
Marder, subject to higher and better offers at an auction.

Judge Raymond B. Ray oversees the case.  Leslie Gern Cloyd, Esq.,
and Paul Steven Singerman, Esq. -- lcloyd@bergersingerman.com and
singerman@bergersingerman.com -- at Berger Singerman, P.A., serve
as the Debtor's counsel.  Development Specialists, Inc., serves as
the Debtor's restructuring advisors.  The Debtor tapped Steven J.
Gutter, P.A., as its special litigation counsel in connection with
collection of accounts receivable, and authorization to settle
accounts receivable claims in the ordinary course of business.

The petition was signed by DSI's Joseph J. Luzinski, who serves as
chief restructuring officer.  Kurtzman Carson Consultants LLC
serves as the Debtor's claims and noticing agent.  In its
petition, the Debtor estimated $10 million to $50 million in both
assets and debts.

An official committee of unsecured creditors has been appointed in
the case, and is represented by Segall Gordich, P.A.  The
Committee tapped Soneet Kapila, CPA, and the firm of Kapila &
Company as its financial advisor.

Counsel to the Debtor's lender, Wells Fargo Bank, N.A., is
Jonathan Helfat, Esq., at Otterbourg, Steindler, Houston & Rosen,
P.C.  Counsel to Greenspoon Marder, the proposed purchaser, is R.
Scott Shuker, Esq., at Latham, Shuker, Eden & Beaudine, LLP.


SAFETY-KLEEN: CBS Off Hook in Kansas Facility Cleanup
-----------------------------------------------------
Gavin Broady at Bankruptcy Law360 reports that a federal judge on
Tuesday tossed a suit against CBS Corp. over pollution liabilities
at a Kansas waste management site, bringing an end to a long-
running dispute over cleanup obligations the network acquired with
its purchase of the formerly bankrupt Safety-Kleen Corp.

Bankruptcy Law360 relates that U.S. Magistrate Judge James O'Hara
booted plaintiff Clean Harbors Inc.'s Resource Conservation and
Recovery Act suit after the company -- which purchased the
Coffeyville, Kan., facility from Safety-Kleen in 2002 -- failed to
establish what additional obligations CBS should be liable for.

                         About the Debtor

Headquartered in Delaware, Safety-Kleen Corporation --
http://www.safety-kleen.com/-- provides specialty services such
as parts cleaning, site remediation, soil decontamination, and
wastewater services.  The Company, along with many affiliates,
filed for Chapter 11 protection (Bankr. D. Del. Case No. 00-02303)
on June 9, 2000.  Gregg M. Galardi, Esq., at Skadden, Arps, Slate,
Meagher, represented the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
disclosed $3,031,304,000 in assets and $3,333,745,000 in
liabilities.  Safety-Kleen emerged from Chapter 11 in Dec. 2003
under a plan of reorganization confirmed by Judge Walsh on Aug. 1,
2003, that transferred ownership of the Company to its secured
creditors and created a litigation and claims resolution trust for
the benefit of unsecured creditors.


SAGE COLLEGES: Moody's Affirms 'B2' Long-Term Debt Rating
---------------------------------------------------------
Moody's Investors Service has affirmed The Sage Colleges' B2 long-
term debt rating on the Series 1999 fixed rate bonds and the B2
underlying rating on the Series 2002 variable rate demand bonds,
issued through the City of Albany Industrial Development Agency
(Albany IDA) and Rensselaer County Industrial Development Agency
(Rensselaer IDA), respectively. The outlook remains negative.

Summary Rating Rationale

The B2 rating and negative outlook for The Sage Colleges is based
on extremely thin liquidity (23 days at close of fiscal year 2011)
to support operations and demand debt, reliance on an operating
line of credit for annual cyclical cash flow needs, and recent
additional bank collateralization requirements for the
Manufacturers and Traders Trust Company (M&T) operating line of
credit to which funds were legally allocated from previously
restricted endowment monies. The fact that nearly all of Sage's
unrestricted funds are securitizing a cyclical cash flow operating
line is a credit negative, ultimately placing the fixed rate
bondholders in a subordinate position that could impact expected
recovery in the event of default. The rating also considers the
recent positive momentum in operating results, student demand and
enrollment improvements, and fund raising successes driven by a
focused management team.

Challenges

* Frail balance sheet, including $2.6 million in monthly
liquidity at the close of fiscal year (FY) 2011, with $5.5 million
used during FY 2011 to pay off a bank term loan and heavy reliance
on a line of credit to manage cyclical cash flow. Sage's reported
monthly liquidity was 23 days in FY 2011, down from 86 days in FY
2010. Though mitigated during FY 2012 with new donor receipts and
donor-restricted funds reclassified as unrestricted, substantially
all unrestricted resources are held as collateral.

* Significant bank concentration with a letter of credit and a
line of credit provided by Manufacturers and Traders Trust Company
(rated A2/P-1). Further, the college's endowment assets are held
at M&T and nearly all of Sage's unrestricted investments
collateralize the full available $6.0 million line of credit.

* Heavy reliance on tuition and auxiliaries revenues at nearly
86% of Moody's adjusted operating revenues for FY 2011, though
revenue streams are distributed among the four program-diverse
Sage colleges.

* High concentration of private equity fund investments and
manager concentration, with nearly 44% of the limited level of
investments distributed among four managers in private, hedged and
multi-strategy equity funds. The allocation is notable given the
pooled endowment size of $20.5 million as of March 31, 2012.

Strengths

* Improvement in financial performance in FY 2011, with the first
positive operating margin of 1.5% (Moody's calculated) since FY
2007, as a result of new enrollment revenue and expense
containment. Management projects a net surplus for FY 2012, up 58%
over the same period last year. The three year average operating
margin was negative 3.3%, operating cash flow margin was 8.6%, and
overall debt service coverage was 2.5 times. Management has
demonstrated the ability to achieve healthy increases of net
tuition revenue through enrollment growth and control of
discounting.

* Notable improvement in the market position of the college with
17.4% growth in full-time equivalent enrollment in the fall 2008
to fall 2011 period and management expectations for continued
growth in the fall of 2012 despite the challenging climate.

* Improved donor support with $25 million raised since May 2011,
a marked contrast to the three-year annual average of $4.7 million
in FY 2011. The gifts include $20 million of support received in
March and April 2012, which though largely earmarked for capital
projects, more than $7 million will be directed to endowment.
Management expects continued strength in donor support in the next
few years during the current comprehensive campaign.

* Focused and strategically aligned governance and management
teams that understand the key challenges are building a track
record of success.

* Absence of debt derivatives, as a swap on the series 2002 bonds
expired on March 1, 2012.

Outlook

The negative outlook reflects Moody's expectation that The Sage
College's will continue to face thin liquidity over the short to
medium term along with a competitive student market environment.
These factors are partially offset by the recent trend of net
tuition revenue growth and fundraising gains driven by focused and
strategically aligned governance and management teams.

What Could Change The Rating Up

Sustained balanced operations in the near term; significant
improvement in liquidity position and non-reliance on external
liquidity for operations; removal of bank collateralization of
unrestricted liquidity; extraordinary donor support

What Could Change The Rating Down

Return to operating deficits and deterioration of unrestricted
assets; inability to increase net student revenue, continued
deterioration in liquidity; inability to access needed liquidity;
downgrade of M&T Bank and resulting acceleration of debt repayment
by Sage

Methodology

The principal methodology used in this rating was U.S. Not-for-
Profit Private and Public Higher Education in August 2011.


SATNAM LODGING: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Satnam Lodging, L.L.C.
        1051 N. Cambridge St.
        Kansas City, MO 64120

Bankruptcy Case No.: 12-42607

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Western District of Missouri (Kansas City)

Judge: Arthur B. Federman

Debtor's Counsel: Lydia M. Carson, Esq.
                  CARSON LAW CENTER, P.C.
                  4004 Washington St.
                  Kansas City, MO 64111
                  Tel: (816) 333-1110
                  E-mail: lydiacarsonlaw@yahoo.com

Scheduled Assets: $5,958,378

Scheduled Liabilities: $4,306,534

A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/mowb12-42607.pdf

The petition was signed by Daljeet Mann.


SEALY CORP: Reports $1.6 Million Net Income in Q2 2012
------------------------------------------------------
Sealy Corporation filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing net income
of $1.67 million on $312.03 million of net sales for the three
months ended May 27, 2012, compared with a net loss of $377,000 on
$321.29 million of net sales for the three months ended May 29,
2011.

The Company reported net income of $2.91 million on
$624.32 million of net sales for the six months ended May 27,
2012, compared with a net loss of $1.27 million on $626.82 million
of net sales for the six months ended May 29, 2011.

The Company's balance sheet at May 27, 2012, showed $923.55
million in total assets, $988.20 million in total liabilities and
a $64.64 million total stockholders' deficit.

"We delivered solid financial and operational performance in the
second quarter of 2012," stated Larry Rogers, Sealy's President
and Chief Executive Officer.  "Our increased gross margin and
Adjusted EBITDA performance for the quarter were driven by the
successful rollout of our Next Generation Stearns & Foster line,
and our strategic commitment to driving profitable sales."

A copy of the Form 10-Q is available for free at:

                        http://is.gd/jEQjrT

                         About Sealy Corp.

Trinity, North Carolina-based Sealy Corp. (NYSE: ZZ) --
http://www.sealy.com/-- is the largest bedding manufacturer in
the world with sales of $1.5 billion in fiscal 2008.  The Company
manufactures and markets a broad range of mattresses and
foundations under the Sealy(R), Sealy Posturepedic(R), including
SpringFree(TM), PurEmbrace(TM) and TrueForm(R); Stearns &
Foster(R), and Bassett(R) brands.  Sealy operates 25 plants in
North America, and has the largest market share and highest
consumer awareness of any bedding brand on the continent.  In the
United States, Sealy sells its products to approximately 3,000
customers with more than 7,000 retail outlets.

The Company reported a net loss of $9.88 million for the 12 months
ended Nov. 27, 2011, and a net loss of $13.74 million during the
prior year.  The Company reported a net loss of $15.20 million
for the three months ended Nov. 27, 2011.

                           *     *      *

Sealy carries 'B' local and issuer credit ratings, with stable
outlook, from Standard & Poor's.


SEQUA CORP: S&P Raises Corp. Credit Rating to 'B'; Outlook Stable
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Tampa, Fla.-based Sequa Corp. to 'B' from 'B-'. "At the
same time, we raised our issue ratings on Sequa's secured credit
facility to 'B' from 'B-' and unsecured notes to 'CCC+' from
'CCC'. The recovery ratings remain unchanged," S&P said.

"The upgrade reflects our expectations that Sequa's credit
protection measures, though still weak, will continue to improve
over the next year due to increasing earnings and some debt
reduction," said Standard & Poor's credit analyst Chris DeNicolo.
"These improvements reflect strengthening core markets--especially
airline and commercial aerospace sectors, cost reductions and
efficiency initiatives, new contracts, a full year of earnings
from the Roll Coater acquisition last year, and acquisition
synergies."

"The ratings on Sequa reflect its 'highly leveraged' financial
profile and weak, albeit improving, credit ratios that resulted
from an LBO in 2007, the debt-financed Roll Coater acquisition
last year, and until recently, poor profitability. Standard &
Poor's views the company's business risk profile as 'fair,'
reflecting its major positions in cyclical and competitive niche
markets."

"Market improvements beginning in 2010 and continuing throughout
2011--specifically in the airline and automotive sectors--and into
2012 have since helped to restore credit metrics and decrease the
company's leverage. We expect further improvements in commercial
aerospace and autos through 2012, but military sales likely will
be flat or down, and the metal coating business likely will see
only modest growth because of weak nonresidential construction,"
Mr. DeNicolo said.

"The outlook is stable. The ongoing economic recovery,
strengthening core markets, Sequa's various actions aimed at
increasing efficiency, a full year of Roll Coater earnings, and
some debt reduction should improve credit protection measures over
the next 12 to 18 months. However, we are unlikely to raise the
rating further until the company addresses the maturity of its
revolver in 2013 and refinances its debt due in 2014 and 2015,"
S&P said.


SF FUEL: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: SF Fuel, LLC
        503 North Oakwood Road
        Oakwood, IL 61858

Bankruptcy Case No.: 12-91037

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Central District of Illinois (Danville)

Judge: Gerald D. Fines

Debtor's Counsel: Steven L. Blakely, Esq.
                  ACTON & SNYDER, LLP
                  11 E North St
                  Danville, IL 61832
                  Tel: (217) 442-0350
                  E-mail: slblakely4@yahoo.com

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $1,000,001 to $10,000,000

The Debtor did not file a list of its largest unsecured creditors
together with its petition.

The petition was signed by Mir Iqbal, manager.


SHAMROCK-HOSTMARK: 5 Hotels File for Chapter 11 in Chicago
----------------------------------------------------------
Five hotels owned by investment fund Shamrock-Hostmark Hotel Fund
sought Chapter 11 protection on June 27, 2012, in Chicago.

Shamrock-Hostmark Princeton Hotel, LLC (Bankr. N.D. Ill. Case
No. 12-25860) and four affiliates filed motions to use cash
collateral, maintain existing bank accounts, continue customer
practices and pay prepetition employee obligations.  A hearing on
the motions is scheduled for July 2, 2012, at 2:00 p.m.

The Debtors have not sought joint administration of their Chapter
11 cases.

Shamrock-Hostmark Princeton owns the DoubleTree by Hilton Hotel
Princeton located in Princeton, New Jersey.  The hotel currently
has 238 rooms and has 100 employees employed by an affiliate.
Shamrock-Hostmark Princeton borrowed $15.76 million from General
Electric Capital Corp. in 2006 to fund renovations to convert the
hotel from a Radisson brand to a DoubleTree brand.

Although the hotel's performance has shown signs of significant
improvements in the past two years, the Debtor says that the
maturity of the GE loan on May 31 prompted the Chapter 11 filing.
The Debtor entered into negotiations with the lender to extend or
refinance the loan.  Those negotiations proved unsuccessful and,
on June 18, 2012, the Lender issued a notice of default to the
Debtor and threatened to foreclose on the hotel.

Affiliates of Shamrock-Hostmark Princeton also incurred loans
totaling $84.4 million from GE.

Shamrock-Hostmark Princeton and its affiliates believe that
chapter 11 will afford them opportunity to restructure or
refinance the loans and stabilize the hotels over the next several
years as the economy continues to recover from one of the worst
recessions in the country's history.

Debtor-affiliates that also sought Chapter 11 protection are:

  Debtor                               Hotel Owned
  ------                               -----------
Shamrock-Hostmark Texas Hotels, L.P.   Crowne Plaza Hotel
                                       San Antonio, TX

Shamrock-Hostmark
  Palm Desert Hotels, LLC              Embassy Suites Palm Desert
                                       Palm Desert, CA

Shamrock-Hostmark
  Andover Hotels, LLC                  Wyndham Boston Andover
                                       Andover, MA
Shamrock-Hostmark
  Tampa Westshores Hotel, LLC          DoubleTree by Hilton
                                       Hotel Tampa Airport -
                                       Westshore
                                       Tampa, FL


SM ENERGY: S&P Rates New $300MM Senior Unsecured Notes 'BB'
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' senior
unsecured issue rating to Denver-based SM Energy Co.'s proposed
$300 million senior unsecured notes due 2023. "The recovery rating
on the notes is '4', indicating our expectation of average (30% to
50%) recovery in the event of a payment default. SM Energy's 'BB'
corporate credit rating and stable outlook are unaffected. The
exploration and production company intends to use proceeds to
repay outstanding borrowings on its credit facility and for
general corporate purposes," S&P said.

"The ratings on Denver, Colo.-based SM Energy Co. reflect what
Standard & Poor's views as the company's 'weak' business risk as a
midsize player in the volatile and capital-intensive oil and
natural gas exploration and production (E&P) industry. The ratings
also reflect the company's 'significant' financial risk," S&P
said.

"SM Energy's production base--557 million cubic feet equivalent
(Mmcfe) per day in first-quarter 2012--is comparable with other
rated midsize U.S. E&P companies. The company has increased its
production rapidly in recent years. For full-year 2011, production
was about 170 billion cubic feet equivalent (Bcfe), up about 54%
from 2010 production. Management expects a further 30% to 33%
increase in production for 2012 compared with 2011. We believe SM
Energy is well-positioned in the Eagle Ford (in Texas) and Bakken
(centered on North Dakota) fields, where ongoing drilling efforts
should enable the company to realize its growth goals," S&P said.

RATINGS LIST
SM Energy Co.
Corporate credit rating                    BB/Stable/--

New Rating
Proposed $300 mil sr unsecd nts due 2023   BB
  Recovery rating                           4


STOCKTON, CA: Moody's Cuts General Fund Debt Rating to 'Caa3'
-------------------------------------------------------------
Moody's Investors Service has downgraded to Caa3 various general
fund-supported debt of the city of Stockton, California. Moody's
has downgraded the city's pension obligation debt to Caa3 from B3
and its lease revenue debt to Caa3 from Caa1. The outlook on these
bonds is negative.

Moody's has confirmed the rating on the city's water enterprise
debt at Ba3, the city's sewer enterprise debt at Ba1 and two of
the city's community facilities districts' special tax bonds at
Baa2. The outlook on these bonds is developing.

Moody's has also withdrawn the city's issuer rating for business
reasons.

Ratings Rationale

Moody's rating action on the city's general fund supported bonds
reflects the city's June 26 adoption of a budget that would
suspend payments on some of its lease and pension obligation bonds
backed by its general fund in fiscal 2013 in order to close an
approximately $26 million budget gap. The rating action also
incorporates the city's announcement that it will likely file for
bankruptcy protection after the failure of a 3-month mediation
process with its creditors. The Caa3 rating level assumes losses
to bondholders will be greater than 20%. The negative outlook
reflects the high likelihood that losses could exceed Moody's
estimates.

The city completed California's AB 506 mediation process on June
25 and has authorized a bankruptcy filing in the event
negotiations failed. In order to come into balance, the proposed
2013 fiscal year budget relies heavily on the suspension of $12
million in debt service. This $12 million figure represents
approximately 46% of the city's budget solutions. The city is
running out of cash and faces limited time and options to fix its
structural imbalance.

Moody's believes that the magnitude of the budget gap and heavy
reliance on debt service reductions as part of the budget
solutions is an indication of the likelihood of a high level of
losses that the city's pension obligation and lease bonds would
experience in bankruptcy. Under the bankruptcy code, these bonds
would be treated as unsecured debt and would likely be subject to
restructuring and losses in order to facilitate a recovery.

The confirmation of the ratings of the city's water and sewer
enterprise debt and community facilities districts' special tax
bonds reflects Moody's view that losses are unlikely, although how
the bonds continue to perform in a potential bankruptcy remains
uncertain. Moody's believes that in bankruptcy a court should find
the city's enterprise and special tax debt to be backed by a
pledge of special revenues, entitling bondholders to receive debt
service payments despite the automatic stay, which prevents a
borrower from making payments to creditors in bankruptcy. Debt
service payments could, however, be subordinate to operating
expenses of the systems. As of 2010, both the water and sewer
system operations were satisfactory, but the city has not issued
an audit since then. The developing outlook reflects the inherent
uncertainty of a bankruptcy process that could last for up to
several years.

What Could Change The Ratings - Up

-- For the pension obligation and lease revenue bonds, a lower
    level of losses than that Moody's is assuming and restored
    structural balance in the city's budget.

-- For the enterprise and special tax bonds, a continuation of
    debt service payments in full in bankruptcy and evidence that
    bondholders will receive the full value of their principal,
    without adjustment.

What Could Change The Ratings - Down

-- For the pension obligation and lease revenue bonds,
    indications that expected recovery in a bankruptcy has
    deteriorated beyond currently anticipated levels.

-- For the enterprise and special tax bonds, a disruption of
    debt service and indications that the bonds would be subject
    to a loss in principal.

Principal Rating Methodology

The principal methodology used in this rating was General
Obligation Bonds Issued by U.S. Local Governments published in
October 2009.


SUNSHINE GROUP: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Sunshine Group Travel Center, Inc.
        503 North Oakwood Road
        Oakwood, IL 61858

Bankruptcy Case No.: 12-91038

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Central District of Illinois (Danville)

Judge: Gerald D. Fines

Debtor's Counsel: Steven L. Blakely, Esq.
                  ACTON & SNYDER, LLP
                  11 E North St
                  Danville, IL 61832
                  Tel: (217) 442-0350
                  E-mail: slblakely4@yahoo.com

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $1,000,001 to $10,000,000

The Debtor did not file a list of its largest unsecured creditors
together with its petition.

The petition was signed by Mir Iqbal, president.


THERMOENERGY CORP: Has Development Agreement with Itea
------------------------------------------------------
ThermoEnergy Corporation, on June 20, 2012, entered into an
agreement with Itea S.p.A. for the development of pressurized oxy-
combustion in North America.  The Company's subsidiary, Unity
Power Alliance LLC, will utilize the proprietary technology of
Itea and ThermoEnergy Power Systems LLC for these purposes:

   (i) advancing, developing and promoting the use of the coal
       application of pressurized oxy-combustion in North America;

  (ii) constructing a pilot plant utilizing that technology;

(iii) subsequently constructing a demonstration facility based
       on the technology as implemented in the Pilot Plant; and

  (iv) if Funding Opportunity DE-FOA-0000636, for which UPA has
       applied to the U.S. Department of Energy, is awarded to
       UPA, performing that contract.

The Company has also agreed that Itea may, at any time on or
before Dec. 20, 2012, acquire a 50% ownership interest in UPA for
nominal consideration.

The Agreement provides that, following Itea's acquisition of an
ownership interest, UPA will be governed by a four-member Board of
Directors, with two directors nominated by us and two directors
nominated by Itea.  The Managing Director of UPA will be one of
the directors whom the Company nominates.  The Company's Board of
Directors has designated Cary G. Bullock, the Company's Chairman
and CEO, and Robert Marrs, the Company's Vice President -
International Business Development, to serve on the UPA Board of
Directors, with Mr. Marrs to be designated as Managing Director.

On June 20, 2012, the Company, TEPS, Itea and UPA entered into a
Detailed License Contract.  The Company and TEPS have granted to
UPA a non-exclusive, non-transferable royalty-free license to use
the Company's intellectual property and know-how relating to oxy-
combustion at very high pressures and Itea has granted to UPA a
non-exclusive, non-transferable royalty-free license to use Itea's
intellectual property and know-how relating to oxy-combustion at
somewhat lower pressures.  The licenses to UPA become effective
upon Itea's acquisition of an ownership interest in UPA, and are
limited to use in the Project.

A copy of the Agreement is available for free at:

                        http://is.gd/mOI6Iw

A copy of the License Agreement is available for free at:

                        http://is.gd/xnhQ8a

                  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.

After auditing the 2011 results, Grant Thornton LLP, in Boston,
Massachusetts, expressed substantial doubt about the Company's
ability to continue as a going concern.  The independent auditors
noted that the Company incurred a net loss for the year ended Dec.
31, 2011, and, as of that date, the Company's current liabilities
exceeded its current assets by $3,387,000 and its total
liabilities exceeded its total assets by $4,603,000.

The Company reported a net loss of $17.38 million in 2011,
compared with a net loss of $14.85 million during the prior year.

The Company's balance sheet at March 31, 2012, showed
$5.26 million in total assets, $10.66 million in total
liabilities, and a $5.39 million total stockholders' deficiency.


THERMODYNETICS INC: Suspending Filing of Reports with SEC
---------------------------------------------------------
Thermodynetics, Inc., filed a Form 15 notifying of its
suspension of its duty under Section 15(d) to file reports
required by Section 13(a) of the Securities Exchange Act of 1934
with respect to its common stock, par value $0.01 per share.
There were 900 holders of the common shares as of June 25, 2012.

                        About Thermodynetics

Thermodynetics, Inc., is engaged in managing its real estate and
business holdings, and investing in other companies.  In June 2011
the Company acquired the rights to a software program that is to
be marketed in the wagering industry.  The software is designed to
assist individuals in selecting winning wagers in horse racing
events.

The Company is currently in default on their line of credit and
its long-term mortgages.   During June, 2010, the Company's bank
commenced two legal proceedings.  Certain of the Company's assets
are being offered for sale which, upon consummation of a
successful sale, would be expected to cure the defaults.

The Company's balance sheet at Dec. 31, 2011, showed $3.91 million
in total assets, $3.48 million in total liabilities and $431,000
stockholders' equity.


TRAINOR GLASS: Hires Toney Capital to Auction Fishing Boat
----------------------------------------------------------
Trainor Glass Company, doing business as Trainor Modular Walls,
Trainor Solar and Trainor Florida, sought and obtained permission
from the U.S. Bankruptcy Court to employ Toney Capital Holdings
LLC -- d/b/a National Liquidators/National Yacht Sales -- to
auction the Debtor's 2006 Grady White 27' fishing boat.

The terms of the Agreement is the earlier of (i) 6 months; (ii)
the sale of the Boat by Auction; or (iii) termination on 30 days'
written notice by either party.

Under the Agreement, the Debtor will pay National a 10% commission
on the Auction sale of the Boat, during the term of the Agreement
and within 12 months thereafter if the sale is consummated with a
buyer procured by National.

The Debtor attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.

                 About Trainor Glass

Trainor Glass Company, doing business as Trainor Modular Walls,
Trainor Solar, and Trainor Florida, filed for Chapter 11
bankruptcy (Bankr. N.D. Ill. Case No. 12-09458) on March 9, 2012.
Trainor was founded in 1953 by Robert J. Trainor Sr. to pursue a
residential glass business in Chicago, Illinois.  Trainor's
business model was focused on quality fabrication, design,
engineering, and installation of glass products and framing
systems in virtually every architectural application, including
(a) new construction, (b) green-building solutions, (c) building
rehabilitation, (d) storefronts and entrances, (e) tenant
interiors, and (f) custom-specialty work.

The Hon. Carol A. Doyle oversees the Chapter 11 case.  David A.
Golin, Esq., Michael L. Gesas, Esq., and Kevin H. Morse, Esq., at
Arnstein & Lehr LLP, serve as the Debtor's counsel.  High Ridge
Partners, Inc., serves as its financial consultant.

The Debtor scheduled $14,276,745 in assets and $64,840,672 in
liabilities.

A three-member official committee of unsecured creditors has been
appointed in the case.  The committee retained Sugar Felsenthal
Grais & Hammer LLP as counsel.


TRAINOR GLASS: Court Approves Branford as Auctioneer
----------------------------------------------------
Trainor Glass Company, doing business as Trainor Modular Walls,
Trainor Solar, and Trainor Florida, sought and obtained permission
from the U.S. Bankruptcy Court to employ Branford Auctions LLC as
auctioneer.

Trainor Glass Company, doing business as Trainor Modular Walls,
Trainor Solar, and Trainor Florida, filed for Chapter 11
bankruptcy (Bankr. N.D. Ill. Case No. 12-09458) on March 9, 2012.
Trainor was founded in 1953 by Robert J. Trainor Sr. to pursue a
residential glass business in Chicago, Illinois.  Trainor's
business model was focused on quality fabrication, design,
engineering, and installation of glass products and framing
systems in virtually every architectural application, including
(a) new construction, (b) green-building solutions, (c) building
rehabilitation, (d) storefronts and entrances, (e) tenant
interiors, and (f) custom-specialty work.

The Hon. Carol A. Doyle oversees the Chapter 11 case.  David A.
Golin, Esq., Michael L. Gesas, Esq., and Kevin H. Morse, Esq., at
Arnstein & Lehr LLP, serve as the Debtor's counsel.  High Ridge
Partners, Inc., serves as its financial consultant.

The Debtor scheduled $14,276,745 in assets and $64,840,672 in
liabilities.

A three-member official committee of unsecured creditors has been
appointed in the case.  The committee retained Sugar Felsenthal
Grais & Hammer LLP as counsel.


USG CORP: Contributes 1.2-Mil. Shares to Retirement Plan Trust
--------------------------------------------------------------
USG Corporation, on June 26, 2012, contributed 1,249,219 shares of
its common stock, par value $.10 per share, to the USG Corporation
Retirement Plan Trust, the trust maintained in connection with the
defined benefit pension plan sponsored by the Company.  The
Contributed Shares were valued for purposes of the contribution at
$16.01 per share, or approximately $20 million in the aggregate,
by Evercore Trust Company, N.A., an independent fiduciary that has
been appointed as investment manager with respect to the
Contributed Shares.  The Contributed Shares were issued to The
Northern Trust Company, as trustee of the Trust, in reliance upon
the exemption from registration provided by Section 4(2) of the
Securities Act of 1933, as amended, and in furtherance of the
Registrant?s funding of the Trust.

On June 26, 2012, the Company also entered into a Registration
Rights Agreement with Evercore, in its capacity as investment
manager for the Contributed Shares.  The Registration Rights
Agreement requires, among other things, that the Company file with
the Securities and Exchange Commission a shelf registration
statement on Form S-3 to register the Contributed Shares for the
purpose of resale from time to time by the Trust.  Under the
Registration Rights Agreement, the Registrant is required to use
its commercially reasonable efforts to cause the registration
statement to remain continuously effective until all Contributed
Shares have been sold by the Trust, all of the Contributed Shares
may be sold in accordance with Rule 144 promulgated by the SEC
under the Act or 90 days after the number of Contributed Shares
held by the Trust is less than 1% of the Company's then
outstanding shares of common stock, whichever occurs earlier.  The
Company registered the resale of the Contributed Shares by the
Trust with the SEC on June 26, 2012.

                       About USG Corporation

Based in Chicago, Ill., USG Corporation -- http://www.usg.com/--
through its subsidiaries, manufactures and distributes building
materials producing a wide range of products for use in new
residential, new nonresidential and repair and remodel
construction, as well as products used in certain industrial
processes.

The company filed for Chapter 11 protection on June 25, 2001
(Bankr. Del. Case No. 01-02094).  When the Debtors filed for
protection from their creditors, they disclosed $3.252 billion in
assets and $2.739 billion in liabilities.  The Debtors emerged
from bankruptcy protection on June 20, 2006.

The Company reported a net loss of $390 million in 2011 and a net
loss of $405 million in 2010.

The Company's balance sheet at March 31, 2012, showed
$3.73 billion in total assets, $3.57 billion in total liabilities
and $154 million in total stockholders' equity.

                           *     *     *

As reported by the TCR on Aug. 15, 2011, Standard & Poor's Ratings
Services lowered its corporate credit rating on USG Corp. to 'B'
from 'B+'.

"The downgrade reflects our expectation that USG's operating
results and cash flow are likely to be strained over the next year
due to the ongoing depressed level of housing starts and still-
weak commercial construction activity," said Standard & Poor's
credit analyst Thomas Nadramia.  "It is now more likely, in
our view, that any meaningful recovery in housing starts may be
deferred until late 2012 or into 2013.  As a result, the risk that
USG's liquidity in the next 12 to 24 months will continue to erode
(and be less than we incorporated into our prior ratings) has
increased.  The ratings previously incorporated a greater
improvement in housing starts, which would have enabled USG to
reduce its negative operating cash flow in 2012 and achieve
breakeven cash flow or better by 2013."

In the Sept. 14, 2011, edition of the TCR, Fitch Ratings has
downgraded USG Corporation's Issuer Default Rating (IDR) to 'B-'
from 'B'.  The Rating Outlook remains Negative.

The ratings downgrade and the Negative Outlook reflect Fitch's
belief that underlying demand for the company's products will
remain weak through at least 2012 and the company's liquidity
position is likely to deteriorate in the next 18 months.  With the
recent softening in the economy and lowered economic growth
expectations for 2011 and 2012, the environment may at best
support a relatively modest recovery in housing metrics over the
next year and a half.  Fitch had previously forecast a slightly
more robust housing environment in 2011 and 2012.  Moreover, new
commercial construction is expected to decline further this year
and may only grow moderately next year.


VIEW SYSTEMS: Stegman & Company Replaces Seale as Accountants
-------------------------------------------------------------
Seale and Beers, CPAs, LLC, was dismissed as View Systems, Inc.'s
independent accountant on June 21, 2012.  Because the Company has
no standing audit committee the Company's full Board of Directors
participated in and approved the decision to change independent
accountants.

Seale and Beers was initially engaged on March 30, 2012, to serve
as the Company's independent accountant for the year ended
Dec. 31, 2011.  Seale & Beers was dismissed as the Company's
independent accountant prior to completing its audit of the
Company's financial statements for the year ended Dec. 31, 2011,
and prior to rendering an opinion on those financial statements
for that period.  In connection with its audit of financial
statements for the year ended Dec. 31, 2011, there have been no
disagreements with Seale & Beers 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 Seale & Beers would have caused it to make
reference thereto in its report on the financial statements.

Seale & Beers has advised the Company that its audit procedures,
especially those with respect to revenue recognition, have not
been resolved to Seale & Beers's satisfaction prior to its
dismissal.

On June 22, 2012, the Company engaged Stegman & Company as its new
registered independent public accounting firm.  Stegman & Company
is headquartered in Baltimore, Maryland and has 12 partners and 25
staff members.  During the two most recent fiscal years and the
interim periods preceding the engagement, the Company has not
consulted Stegman & Company regarding (i) the application of
accounting principles to a specific transaction, either completed
or proposed, or the type of audit opinion that might be rendered
on the Company's financial statements, or (ii) any matter that was
either the subject of a disagreement as that term is used in Item
304(a)(1)(iv) of Regulation S-K and the related instructions to
Item 304 of Regulation S-K or a reportable event as that term is
used in Item 304(a)(1)(v) and the related instructions to Item 304
of Regulation S-K.

This decision to engage Stegman & Company was approved by the full
Board of Directors of the Company.  Because the Company has no
standing audit committee the Company's full Board of Directors
participated in and approved the decision to change independent
accountants.

                        About View Systems

Baltimore, Md.-based View Systems, Inc., develops, produces and
markets computer software and hardware systems for security and
surveillance applications.

The Company reported a net loss of $368,329 on $576,735 of
net revenues for the nine months ended Sept. 30, 2011, compared
with a net loss of $294,065 on $722,042 of net revenues for the
same period during the prior year.

The Company's balance sheet at Sept. 30, 2011, showed
$1.48 million in total assets, $1.82 million in total liabilities,
and a $339,294 total stockholders' deficit.

As reported in the TCR on March 15, 2011, Robert L. White &
Associates, Inc., in Cincinnati, Ohio, expressed substantial doubt
about View Systems' ability to continue as a going concern,
following the Company's 2010 results.  The independent auditors
noted that the Company had a net loss of $513,353 for the year
ended Dec. 31, 2010, and has an accumulated deficit of $22,837,787
at Dec. 31, 2010.


VITRO SAB: Must Have Stay Immediately to Halt Asset Seizures
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Vitro SAB will be able to appeal directly to the U.S.
Court of Appeals in New Orleans from a ruling on June 13 by a U.S.
bankruptcy judge in Dallas refusing to enforce the glassmaker's
Mexican reorganization plan in the U.S.  Unless Vitro convinces
the appeals court to impose a stay pending appeal, bondholders
will be able to begin seizing assets of the company and
subsidiaries after June 29.

According to the report, Vitro is appealing because a bankruptcy
judge in Dallas ruled that the Mexican reorganization was
"manifestly contrary" to U.S. law and public policy.  In the
opinion of the bankruptcy judge, the Mexican plan improperly
allowed Vitro subsidiaries to chop down their guarantees on $1.2
billion in defaulted bonds without having been in bankruptcy
themselves.

On Wednesday, the 5th Circuit in New Orleans granted a direct
appeal, allowing the parties to skip an intermediate appeal to a
federal district judge.  Vitro came up short because the circuit
court, in the same order June 27, refused to accelerate the
appeal.  Carolyn King, one of the three circuit judges who made
Wednesday's ruling, would have held oral argument quickly after
the last brief was filed.  She also would have called on the
bankruptcy judge "to decide promptly" on additional "strong
objections" the bankruptcy judge said he didn't reach because
he already found the Mexican reorganization defective.

Until the circuit court accepted the appeal, there was a watershed
hearing scheduled June 28 in Dallas where Vitro would have asked
District Judge Royal Furgeson to enjoin the bondholders from
attaching assets.  The bankruptcy judge refused to stop attachment
of assets after June 29.  On learning that the circuit court
granted the direct appeal, Judge Furgeson canceled the June 28
hearing, thus requiring Vitro to move quickly in the circuit court
for a stay pending appeal.  Before Judge Furgeson canceled the
stay hearing, holders of 60 percent of the defaulted bonds filed
papers urging the district court not to impose a stay.

According to the report, the bondholders argued the subsidiaries
could fend off asset seizure by filing their own bankruptcies.
The bondholders urge the courts to follow the general rule that
special circumstances are required before one company's bankruptcy
becomes reason for halting legal action against a non-bankrupt
affiliate.  The bondholders also contend the subsidiaries could
obtain a stay by filing bonds in the lawsuits in New York State
court where the creditors are obtaining judgments on the defaulted
bonds.

The appeal in the Circuit Court is Vitro SAB de CV v. Ad Hoc Group
of Vitro Noteholders (In re Vitro SAB de CV), 12-90055, 5th U.S.
Circuit Court of Appeals (New Orleans).  Vitro's motion in
district court for a stay pending appeal was In re Vitro SAB de
CV, 11-3554, 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.

On June 13, 2012, U.S. Bankruptcy Judge Harlin "Cooter" Hale in
Dallas entered a ruling that precluded Vitro from enforcing
its Mexican reorganization plan in the U.S.  The judge ruled that
the Mexican reorganization was "manifestly contrary" to U.S.
public policy because it bars the bondholders from holding Vitro
operating subsidiaries liable to pay on their guarantees of the
bonds.  The Mexican plan reduced the debt of subsidiaries on $1.2
billion in defaulted bonds even though they weren't in bankruptcy
in any country.


VUZIX CORP: Five Directors Elected at Annual Meeting
----------------------------------------------------
Vuzix Corporation held its annual meeting of stockholders at the
Doubletree Hotel at 1111 Jefferson Road, Rochester, New York, on
June 22, 2012.

Paul J. Travers, Grant Russell, William Lee, Jose Cecin and
Michael Scott were each elected as directors of Vuzix Corporation
to serve until the 2013 annual meeting of stockholders or until
their successors have been elected and qualified.  The
stockholders also ratified the board of directors' appointment of
EFP Rotenberg, LLP, as the Company's independent registered public
accounting firm for 2012.

                          About Vuzix Corp.

Rochester, New York-based Vuzix Corporation (TSX-V: VZX)
OTC BB: VUZI) -- http://www.vuzix.com/-- is a supplier of Video
Eyewear products in the defense, consumer and media &
entertainment markets.

The Company reported a net loss of $3.87 million in 2011, a net
loss of $4.55 million in 2010, and a net loss of $3.25 million in
2009.

The Company's balance sheet at Dec. 31, 2011, showed $5.81 million
in total assets, $12.64 million in total liabilities, and a
$6.82 million total stockholders' deficit.

After auditing the 2011 annual report, EFP Rotenberg, LLP, in
Rochester, New York, expressed substantial doubt about the
Company's ability to continue as a going concern.  The independent
auditors noted that the Company has incurred substantial losses
from operations in recent years.  In addition, the Company is
dependent on its various debt and compensation agreements to fund
its working capital needs.  And while there are no financial
covenants with which the Company must comply with, these debts are
past due in some cases.

                         Bankruptcy Warning

The Company said in its 2011 annual report that its future
viability is dependent on its ability to execute these plans
successfully.  If the Company fails to do so for any reason, the
Company would not have adequate liquidity to fund its operations,
would not be able to continue as a going concern and could be
forced to seek relief through a filing under U.S. Bankruptcy Code.


WATERLOO GARDENS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Waterloo Gardens, Inc.
        200 N. Whitford Road
        Exton, PA 19341-2099

Bankruptcy Case No.: 12-16080

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Eastern District of Pennsylvania (Philadelphia)

Judge: Jean K. FitzSimon

Debtor's Counsel: Albert A. Ciardi, III, Esq.
                  Jennifer E. Cranston, Esq.
                  CIARDI CIARDI & ASTIN, P.C.
                  One Commerce Square
                  2005 Market Street, Suite 1930
                  Philadelphia, PA 19103
                  Tel: (215) 557-3550
                  Fax: (215) 557-3551
                  E-mail: aciardi@ciardilaw.com
                          jcranston@ciardilaw.com

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $10,000,001 to $50,000,000

A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/paeb12-16080.pdf

The petition was signed by Robert LeBoutillier, president.

Affiliate that filed separate Chapter 11 petition:

                                                 Petition
   Debtor                              Case No.     Date
   ------                              --------     ----
Waterloo Landscaping, Inc.             12-16081   06/26/12


WATERLOO LANDSCAPING: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Waterloo Landscaping, Inc.
        200 N. Whitford Road
        Exton, PA 19341-2099

Bankruptcy Case No.: 12-16081

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Eastern District of Pennsylvania (Philadelphia)

Judge: Stephen Raslavich

Debtor's Counsel: Albert A. Ciardi, III, Esq.
                  Jennifer E. Cranston, Esq.
                  CIARDI CIARDI & ASTIN, P.C.
                  One Commerce Square
                  2005 Market Street, Suite 1930
                  Philadelphia, PA 19103
                  Tel: (215) 557-3550
                  Fax: (215) 557-3551
                  E-mail: aciardi@ciardilaw.com
                          jcranston@ciardilaw.com

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $10,000,001 to $50,000,000

The Debtor did not file a list of its largest unsecured creditors
together with its petition.

The petition was signed by Robert LeBoutillier, president.
Affiliate that filed separate Chapter 11 petition:

                                                 Petition
   Debtor                              Case No.     Date
   ------                              --------     ----
Waterloo Gardens, Inc.                 12-16080   06/26/12


WATERSCAPE RESORT: Owes $11MM for Unpaid Work, Developer Says
-------------------------------------------------------------
Jake Simpson at Bankruptcy Law360 reports that New York contractor
Pavarini McGovern LLC, the former construction manager for the
Cassa NY Hotel development, moved for summary judgment Monday in
New York bankruptcy court in a $10.8 million adversary suit
against Cassa developer Waterscape Resort LLC for allegedly
diverting lien law trust funds.

Pavarini said that despite claims by Waterscape that the
contractor performed subpar work on the hotel project and missed
repeated deadlines, it is entitled to $10.8 million of the funds
secured by Waterscape's sale of Cassa hotel property under the
dispute, according to Bankruptcy Law360.

                       About Waterscape Resort

Waterscape Resort LLC, aka Cassa NY Hotel And Residences, is a
Delaware limited liability company formed on or about Jan. 24,
2005.  The principal office of the Debtor is at 15 West 34th
Street, New York, New York 10001.  On July 19, 2005, Waterscape
acquired the property, consisting of the three contiguous
buildings at 66, 68 and 70 West 45th Street in Manhattan, for the
sum of $20 million to develop the property into a 45-storey
condominium project including a luxury hotel, a restaurant and
luxury residential apartments.  The purchase was financed with a
$17 million acquisition loan and mortgage from U.S. Bank
Association.

Construction of the hotel and residential units, given the name
Cassa NY Hotel and Residences, commenced in July 2007.  By the end
of September 2010, the hotel and residential units were completed.
The Debtor generates its revenue from guests who stay at the hotel
and in the Debtor's residential condominium units, and from sales
of unsold residential condominium units.  The Debtor's hotel and
rental business has produced gross revenues of approximately $17
million to $18 million on an annual basis, and by the end of
September 2010, the Debtor had sold five residential apartment
units for a total of approximately $12,710,340.

The Debtor's Cassa NY Hotel and Residences features 165 hotel
rooms, and above the hotel units, 57 residences.  The Debtor's
restaurant will occupy the first level below ground, but will be
visible from the ground floor hotel lobby.  The Debtor's
restaurant is not yet open for business.

The Debtor has for several months been embroiled in litigation
with numerous contractors and subcontractors who have asserted
alleged mechanics lien claims against the Property totaling
approximately $20 million.

As of the Petition Date, the Debtor had outstanding approximately
$134.4 million of secured loan principal obligations under credit
facilities with US Bank and USB Capital Resources, Inc.  The debt
is secured by liens upon all of the assets of the Debtor,
including mortgages on the Debtor's real property, together with
liens on all rents, proceeds and cash of the Debtor, pledges of
member interests in Waterscape, and guarantees by Waterscape
members and other third-party grantors.  The Debtor's secured debt
was incurred under three separate agreements for: (i) an
acquisition and project loan; (ii) a construction loan; and (iii)
a mezzanine loan; each of which was made in connection with the
acquisition or development of the Debtor's property.

Over the last several months, the Debtor engaged in extensive
negotiations with the Secured Lenders regarding the parameters of
a comprehensive restructuring.  The Debtor also engaged in
extensive marketing efforts and negotiations to sell its hotel
assets to a non-insider buyer.  The restructuring discussions
between the Debtor and the Secured Lenders reached an impasse, and
on March 21, 2011, UBS, the junior of the two Secured Lenders,
filed a foreclosure action against the Debtor in the Supreme Court
of the State of New York, County of New York.

The Debtor then filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 11-11593) on April 5, 2011.  Brett D. Goodman,
Esq., and Lee William Stremba, Esq., at Troutman Sanders LLP
represent the Debtor as Bankruptcy Counsel.  Holland & Knight LLP
serves as its special litigation counsel.  The Debtor disclosed
$214,285,027 in assets and $158,756,481 in liabilities as of the
Chapter 11 filing.

A 3-member Official Committee of Unsecured Creditors has been
appointed in the Debtor's Chapter 11 case.  Schiff Hardin LLP,
serves as the Committee's counsel.

As reported in the TCR on July 25, 2011, U.S. Bankruptcy Judge
Stuart Bernstein confirmed Waterscape Resort LLC's reorganization
plan on July 22, 2011, which calls for repaying much of the
company's debt with proceeds from the $128 million sale of the
hotel section of the development.  The Plan was filed on May 6,
2011.


YOUR LOCAL MARKET: Case Summary & 20 Largest Unsec. Creditors
-------------------------------------------------------------
Debtor: Your Local Market, LLC
        410 Bellevue Way NE
        Bellevue, WA 98004

Bankruptcy Case No.: 12-16623

Chapter 11 Petition Date: June 26, 2012

Court: United States Bankruptcy Court
       Western District of Washington (Seattle)

Judge: Timothy W. Dore

Debtor's Counsel: Christine M. Tobin-Presser, Esq.
                  BUSH STROUT & KORNFELD LLP
                  601 Union St Ste 5000
                  Seattle, WA 98101
                  Tel: (206) 292-2110
                  E-mail: ctobin@bskd.com

Estimated Assets: $1,000,001 to $10,000,000

Estimated Debts: $1,000,001 to $10,000,000

A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/wawb12-16623.pdf

The petition was signed by Jason Brown, manager.


ZAYO GROUP: S&P Keeps 'B' Corp. Credit Rating; Outlook Stable
-------------------------------------------------------------
Standard & Poor's Ratings Services' ratings on Louisville, Colo.-
based Zayo Group LLC, including the 'B' corporate credit rating
and stable outlook, remain unchanged following the company's
proposed $120 million add-on to its term loan facility due 2019.
The proposal will increase the size of the facility to $1.62
billion from $1.5 billion. The issue-level rating on the senior
secured debt remains 'B' with a '4' recovery rating. The '4'
recovery rating indicates expectations for average (30%-50%)
recovery of principal in the event of default. "We expect the
company to use funds from the transaction to increase liquidity
and potentially fund future acquisitions," S&P said.

"Our ratings on Zayo continue to reflect a financial risk
assessment of 'highly leveraged' and a business risk assessment of
'weak,'" S&P said.

RATINGS LIST

Zayo Group LLC
Corporate Credit Rating            B/Stable/--
Senior Secured
  $1.62 bil term loan fac due 2019  B
   Recovery Rating                  4


* Judge Rakoff Tips His Hand on Upcoming Safe-Harbor Case
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that in footnotes to two recent rulings on other subjects,
U.S. District Judge Jed Rakoff may have tipped his hand that he
will rule in the next few weeks in favor of financial institutions
by expanding the sweep of the so-called safe harbor protecting
swaps from attack in bankruptcy cases.

Mr. Rochelle recounts that Judge Rakoff first ruled in September
that the safe harbor contained in Section 546(e) of the U.S.
Bankruptcy Code precludes trustee Irving Picard from suing to
recover fictitious profits taken out of Bernard L. Madoff
Investment Securities LLC more than two years before bankruptcy.
Mr. Picard is taking the ruling up on appeal to the U.S. Court of
Appeals in Manhattan, seeking reversal and the right to sue going
back six years.

Mr. Rochelle adds that an affiliate of ABN Amro Bank NV persuaded
Judge Rakoff to take a lawsuit out of bankruptcy court dealing
with a similar safe harbor for swaps.  In a brief filed this
month, the bank wants Judge Rakoff to dismiss the suit because the
money that originally emanated from Madoff came into its hands as
part of a swap transaction with a feeder fund.  The bank argues
that the safe harbor for swaps in Section 546(g) bars the suit
because the money came from a swap.  Although the trustee will
file his opposition papers later, the trustee has already argued
that the safe harbor doesn't apply because he's not attempting to
void the transaction between the feeder fund and the bank.  Mr.
Picard says the swap safe harbor doesn't apply because he's going
after the bank as a subsequent recipient of funds fraudulently
transferred from the Madoff firm to the feeder fund.  Mr. Picard's
argument is based on the notion that the recovery he seeks against
the bank as a subsequent transferee is made possible by Section
550. That section isn't one of the enumerated sections covered by
the safe harbors in Section 546, the trustee says.

That's where Rakoff's footnotes come into play, according to Mr.
Rochelle.

In substantially identical language in footnotes in two short
opinions on June 25 and May 15, Judge Rakoff said he "rejects"
the argument that the safe harbor doesn't apply just because the
trustee isn't attempting to recover from a swap party on a
fraudulent transfer theory.  Without citing authority, Judge
Rakoff said in his footnotes that the safe harbor applies any time
the original transfer would invoke the safe harbor.

In the dispute with AMB Amro, the bank will file a reply brief on
July 25. No date has been set as yet for oral argument in Judge
Rakoff's court.

The case involving ABN Amro and swaps is part of Securities
Investor Protection Corp. v. Bernard L. Madoff Investment
Securities LLC, 12-mc-00115, U.S. District Court, Southern
District of New York (Manhattan).


* Multiple Bankruptcies Add Only 90 Days for Tax Claims
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that U.S. District Judge Carlos Murguia ruled on June 26
in Kansas City that the Internal Revenue Service can tag on only
one 90-day extension under Section 507(a)(8) of the U.S.
Bankruptcy Code when deciding if a tax debt is entitled to
priority.  The case, which involved individuals who had been in
Chapter 7 or Chapter 13 on four occasions, is U.S. v. Montgomery,
11-2107, U.S. District Court, District of Kansas (Kansas City).


* Leveraged Buyout Financing Rekindles Junk-Bond Issuance
---------------------------------------------------------
Katy Burne at Dow Jones' Daily Bankruptcy Review reports that
Consolidated Container Co. expects to sell $250 million of high-
yield bonds to pay for its takeover by a private equity group, the
latest sign of a post-crisis rebound in bond sales to fund
leveraged buyouts and a slowly increasing number of mergers and
acquisitions.

Based in Atlanta, Georgia, Consolidated container Company LLC is a
domestic developer, manufacturer and marketer of rigid plastic
containers for mostly branded consumer products and beverage
companies.  Revenues for the twelve months ended March 31, 2012
were approximately $739 million.


* Moody's Says Weak Consumer Confidence Hits U.S. Gaming Sector
---------------------------------------------------------------
The recent improvement in US gaming revenue appears to be stalling
as consumer confidence weakens, US payroll expansion slows, and
retail sales soften, says Moody's Investors Service in a new
special comment "US Gaming: A More Cautious Consumer Steps Away
from the Casino."

"The improving trend in gaming revenues in place since the middle
of last year appears to be stalling," said Peggy Holloway, a
Moody's Vice President -- Senior Credit Officer. "Momentum started
slowing in March, and then in May gaming jurisdictions reported
outright declines in gaming revenue."

Casino operators with significant near-term maturities or highly
leveraged capital structures such as Caesars Entertainment Corp,
Revel Atlantic City, LLC, and CityCenter Holdings LLC are at
greatest risk, says Moody's.

While declining gas prices and low interest rates have boosted
consumers' disposable income and could arrest this decline in
gaming demand, Moody's points to a sharp decline in consumer
sentiment, coupled with still-high unemployment and fear of
contagion from the European debt crisis as troubling signs for the
sector.

Another poor sign is the difficulty of absorbing new supply in
some markets. Newer casinos such as Revel in Atlantic City,
Resorts World in New York and Rivers Casino in Illinois do not
appear to be boosting gaming demand in their markets, says
Moody's.

The report also highlights regional challenges in the Northeast
and Central US gaming regions, including potential oversupply and
negative growth. The Southeast US region saw stronger growth, but
that's mainly because last year casinos were still closed by
flooding on the Mississippi River, says Moody's.


* Moody's Cuts Ratings on Spanish Banks' North American Units
-------------------------------------------------------------
Moody's Investors Service has downgraded certain long-term
supported ratings of Banco Santander S.A.'s (Santander) and Banco
Bilbao Vizcaya Argentaria, S.A.'s (BBVA) North American bank
subsidiaries. Following the downgrades, Moody's placed the
subsidiaries' long- and short-term ratings, including their
standalone bank financial strength ratings (BFSR)/baseline credit
assessments (BCA), on review for downgrade.

The actions follow the downgrades of Santander (standalone
BFSR/BCA to C-/baa2 from C/a3, on review for further downgrade)
and BBVA (standalone BFSR/BCA to D+/baa3 from C/a3, on review for
further downgrade). These actions are discussed in the press
release "Moody's downgrades Spanish banks," dated 25 June 2012 and
available on moodys.com.

LIST OF AFFECTED RATINGS

Subsidiaries of Santander:

- Santander Holdings USA, Inc.: all long- and short-term ratings
   (senior at Baa2) placed on review for downgrade

- Sovereign Bank, N.A.: long-term bank deposit, senior debt and
   issuer ratings downgraded to Baa1 from A3; subordinate debt
   rating downgraded to Baa2 from Baa1; all long- and short-term
   ratings, including the standalone BFSR/BCA of C-/baa1, placed
   on review for downgrade

- Sovereign Real Estate Investment Trust: non-cumulative
   preferred stock rating downgraded to Ba1 (hyb) from Baa3;
   placed on review for further downgrade

- Sovereign Capital Trust IV: Ba1 (hyb) preferred stock rating
   placed on review for downgrade

- Sovereign Capital Trust V: (P)Ba1 preferred stock rating placed
   on review for downgrade

- Sovereign Capital Trust VI: Ba1 (hyb) preferred stock rating
   placed on review for downgrade

- Banco Santander Puerto Rico: long-term bank deposit, senior
   debt and issuer ratings downgraded to Baa1 from A3; all long-
   and short-term ratings placed on review for downgrade; the
   standalone BFSR/BCA of C-/baa1, which was placed on review for
   downgrade on April 10, 2012 because of Puerto Rico's difficult
   operating environment, remains on review

Subsidiaries of BBVA:

- BBVA USA Bancshares, Inc.: long-term issuer rating downgraded
   to Baa3 from Baa1 and placed on review for further downgrade

- Compass Bank: long-term bank deposit, senior debt and issuer
   ratings downgraded to Baa2 from A3; subordinate debt rating
   downgraded to Baa3 from Baa1; all long- and short-term ratings,
   including the standalone BFSR/BCA of C-/baa2, placed on review
   for downgrade

- Phoenix Loan Holdings: non-cumulative preferred stock rating
   downgraded to Ba2 (hyb) from Baa3 and placed on review for
   further downgrade

- Banco Bilbao Vizcaya Argentaria Puerto Rico: long-term bank
   deposit, senior debt and issuer ratings downgraded to Baa2 from
   A3; subordinate debt rating downgraded to Baa3 from Baa1; all
   long- and short-term ratings placed on review for downgrade;
   the standalone BFSR/BCA of C-/baa2, which was placed on review
   for downgrade on April 10, 2012, remains on review

Ratings Rationale

The downgrades reflect the potential adverse effects of
Santander's and BBVA's lower capacity to support their
subsidiaries in North America, reflected by their lower standalone
ratings. The downgrades of the parents' ratings were driven by the
reduced creditworthiness of the Spanish sovereign, as captured by
Moody's recent three-notch downgrade of Spain's government bond
rating (Baa3, on review for further downgrade), which implies a
weaker credit profile for Spanish banks. This results from the
banks' multiple linkages with the sovereign, including (i) the
impact of the government's financial position on the domestic
economy; and (ii) the large exposures of most banks to their
domestic government and to other counterparties that depend on the
credit strength of the government.

The downgrade of Santander's and BBVA's standalone ratings, which
are now one notch below the respective standalone ratings of their
North American bank subsidiaries, means that the subsidiaries'
ratings will no longer benefit from any uplift from parental
support, with the exception of Santander Holdings USA, Inc. and
its capital trust subsidiaries. Previously, Santander's North
American bank subsidiaries benefited from one notch of parental
support uplift, while BBVA's North American subsidiaries benefited
from two notches of uplift.

The ratings of Santander Holdings USA, Inc. and its capital trust
subsidiaries continue to benefit from one notch of uplift given
the parent's continued capacity to support these subsidiaries.
This is reflected by Santander's higher standalone rating of baa2,
one notch above Santander Holdings USA, Inc.'s intrinsic financial
strength of baa3.

Moody's has also attached a hybrid (hyb) indicator to the
non-cumulative preferred stock ratings of Sovereign Real Estate
Investment Trust & Phoenix Loan Holdings.

Rationale For Reviews For Downgrade

Following the downgrades, all of the North American subsidiaries'
ratings were placed on review for downgrade. The reviews reflect
the potential adverse effects from weakening creditworthiness at
the parent level on the standalone financial strength of their
subsidiaries.

During its reviews of the bank subsidiaries' standalone ratings,
Moody's will focus on the independence and resilience of the North
American banks' financial strength in the event that the parents'
creditworthiness is further affected and their ratings lowered.
Generally, Moody's is comfortable with subsidiaries' standalone
ratings exceeding those of their parents, but this is typically
limited by linkages between the subsidiary and the parent bank.
The extent to which the regulatory framework in the US insulates
the subsidiaries from potential adverse developments in Spain will
also be factored into Moody's review of the ratings.

Rating Methodologies

The methodologies used in these ratings were Bank Financial
Strength Ratings: Global Methodology published in February 2007,
and Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology published in March 2012.


* Pa. Lawmakers to Extend Bankr. Moratorium for Distressed Cities
-----------------------------------------------------------------
According to American Bankruptcy Institute, Harrisburg Patriot-
News reported that Pennsylvania lawmakers intend to extend the
moratorium on bankruptcy for financially distressed cities,
including Harrisburg, to Nov. 30, 2012.


* Living Wills Give Banks a Chance to Uncover Own Weak Spots
------------------------------------------------------------
Evan Weinberger at Bankruptcy Law360 reports that up to nine of
the world's largest financial institutions will submit "living
wills" to federal regulators Sunday that provide a blueprint for
taking them apart during a crisis, a process attorneys say has
helped institutions understand their own weaknesses.


* BOOK REVIEW: Hospital Turnarounds - Lessons in Leadership
-----------------------------------------------------------
Editors: Terence F. Moore and Earl A. Simendinger
Publisher: Beard Books
Softcover: 244 pages
Price: $34.95
Review by Henry Berry

Hospital Turnarounds - Lessons in Leadership is a compilation of
twelve essays on the many approaches that have been taken to
resuscitate hospitals in distressed situations.  Most of the
essayists are CEOs or presidents of hospitals or healthcare
organizations, and their stories are all different and compelling
in their own way.  The hospitals differ in their size,
marketplace, facilities, and services offered.  The causes of
their distress vary and the strategies that were used to overcome
them are wide-ranging.  All-in-all, it makes for an engaging
collection of success stories.

The authors have extensive experience in the healthcare system,
and nearly all have held top leadership posts in several public
and private hospitals.  Most importantly, all have been involved
in successful turnarounds at some time in their careers. Two of
the authors are from the field of marketing, which can play a
significant role in hospital turnarounds.

The number of troubled hospitals rises and falls over time,
depending on many factors, including the state of the U.S.
economy.  There are always some hospitals in a distressed
situation or teetering close to it.  In spite of the fact that
healthcare is a basic need in U.S. society, hospitals are
constantly vulnerable to financial problems because of
competition, changing medical technology, new approaches to
healthcare from improved drugs and public awareness, and medical
malpractice lawsuits.  Any or all of these factors can be
financially crippling and, even if the financial impact is
minimized, a hospital's reputation can be damaged.  Like any other
business organization, hospitals can also run into difficulty
because of poor management or labor problems.

The first and last chapters, "Introduction" and "Turnarounds: An
Epilogue," respectively, are written by the co-editors.  The
balance of the chapters contain first-hand accounts of hospital
turnarounds, with the authors asked by the co-editors to "document
the role of the various publics."  The authors do this, offering
their assessment of the role of the board of directors, medical
staff, management team, volunteers, and other relevant "publics"
in the respective turnarounds.   A common thread in this book is
that the import and activities of these publics were different in
every turnaround.  Each turnaround had to address its own
grievous, overriding problem or set of problems.  Each turnaround
had its own cast of characters who brought different backgrounds
and skills to the turnaround.  As a result, each path taken to
overcoming the distressed situation was different.

No matter what the cause or causes of a hospital's distressed
situation, in nearly every case the problems were first realized
when a financial problem became apparent.  Thus, turnarounds are
inevitably focused on improving a hospital's financial situation.
As one of the authors notes, "A turnaround is most often the
result of increased revenues and decreased expenses."  The
approach taken by some of the authors was to focus on
"[increasing] revenues to improve the operating margins of their
organizations."  Many other turnarounds were accomplished by
focusing on reducing expenses.  Invariably, however, a combination
of both was needed and working toward these paired objectives
required a new strategic thinking and the development of
operational capabilities that prepared the hospital for long-term
survival in continually changing market conditions.  One author's
prescription for success was, "Upward communication, fluidity of
organizational structure, a reduction of unnecessary bureaucratic
rules and policies, and ambitious yet realistic goals and
objectives."

These practices are present in healthy companies and usually
missing in distressed companies.  Implementation of these business
practices is essential for a hospital to return to a favorable
financial footing.

Another author addressed "organizational burnout," which must be
corrected if a hospital is to survive.  Burnout is evident when
"the sum of an organization's actual output is decreasing over
time when compared with its potential output."  The challenge
facing hospital executives and turnaround specialists is to reduce
-- and ideally, eliminate -- the gap between actual and potential
output.  The smaller the gap, the more efficient, productive, and
healthy the organization.

These are just a few of the observations and lessons provided in
this collection of essays.  Through engaging first-person accounts
of rescue stories, the reader learns what a turnaround is all
about, how to diagnose a distressed situation, and how to
formulate a strategy that implements specific corrective actions.

Terence F. Moore has been involved in the Michigan hospital system
as President and CEO of Mid-Michigan Health, Board Member of the
Michigan Hospital Association, and Chair of the East Michigan
Hospital Association.  He is also a fellow of the American College
of Healthcare Executives.  Earl A. Simendinger is a professor of
management at the College of Business at the University of Tampa
who for 20 years was a hospital administrator.  Also a fellow in
the American College of Healthcare Executives, he has written many
books and articles on management and organizational development.



                            *********

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 ***