/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/120709.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, July 9, 2012, Vol. 16, No. 189 Headlines 10 MAPLE ASSOC: Assets Not Encumbered by Sonoma Valley Loan 11027 LEOPARD: Case Summary & 7 Largest Unsecured Creditors AMERICAN NATURAL: Inks Financing Term Sheet for $3MM Debentures AMERICAN PATRIOT: Annual Meeting of Shareholders Set for Aug. 31 AMG CAPITAL: Fitch Affirms Securities Rating at 'BB-' ANCHOR BANCORP: Three Directors Resign from Board ARTE SENIOR LIVING: Files for Chapter 11 in Phoenix AS SEEN ON TV: Closes APA of AsSeenOnTV.com for $2.7 Million ASARCO LLC: Union Pacific Fights Bid for Additional Cleanup Fees BASE HOLDINGS: Dallas Court Orders Trial in Lease Dispute BAYOU GROUP: Goldman Loses Appeal of $20.5MM Arbitration Award BIOZONE PHARMACEUTICALS: Issues $455,274 Convertible Notes BONDS.COM GROUP: Hikes CFO's Annual Salary to $225,000 BON-TON STORES: 71.1% of Outstanding Old Notes Validly Tendered BRAD C. HOKE: Case Summary & 18 Largest Unsecured Creditors CAESARS ENTERTAINMENT: Bank Debt Trades at 11% Off CASA DE LUNA: Case Summary & 8 Largest Unsecured Creditors CASTLEVIEW LLC: Case Summary & 3 Largest Unsecured Creditors CDC CORP: Files First Amended Chapter 11 Plan, Disclosures CEMEX SAB: Fitch Rates Proposed $500MM Senior Notes at 'B+/RR3' CHARLES M. BREWER: Case Summary & 20 Largest Unsecured Creditors CHINA TEL GROUP: Ironridge Global Discloses 9.9% Equity Stake CLAMAR ENTERPRISES: Voluntary Chapter 11 Case Summary CLEAR CHANNEL: Bank Debt Trades at 20% Off in Secondary Market CONSTELLATION BRANDS: Fitch Affirms 'BB+' LT Issuer Default Rating CORD BLOOD: Issues $1.2 Million Convertible Note to Tonaquint COUNTRYWIDE FIN'L: Allegedly Used Loan Program to Sway Congress COWBOY CIAO: Restaurant Files for Chapter 11 Bankruptcy Protection CULLIGAN INT'L: Bank Debt Trades at 16% Off in Secondary Market DAVID KIRCHER: Failure to Amend Plan Prompts Chapter 7 Conversion DAVINCI ESTATES: Voluntary Chapter 11 Case Summary DELTA PETROLEUM: Wins Court Approval of Disclosure Statement DELTATHREE INC: Inks Banking Services Pact with Int'l Bancard DEWEY & LEBOEUF: Wants to Pay Up to $700K in Bonuses to Employees DEWEY & LEBOEUF: Wants to Hire Firm to Liquidate Frankfurt Office DEX MEDIA EAST: Bank Debt Trades at 48% Off in Secondary Market DIGITAL REALTY: Fitch Rates $453MM Redeemable Stock at 'BB+' DRINKS AMERICAS: Hubert Millet Resigns from Board of Directors DYNEGY HOLDINGS: To Present Plan for Confirmation Sept. 5 DYNEGY HOLDINGS: Town of Newburgh Seeks Tax Payments DYNEGY INC: Follows Units in Chapter 11 to Set Stage for Merger DYNEGY INC: U.S. Trustee Opposes Merger EK HOSPITALITY: Voluntary Chapter 11 Case Summary EMPIRE RANCH: Case Summary & 20 Largest Unsecured Creditors EMPIRE RESORTS: Exercise Period Under Option Pact on Dec. 21 EP LINCOLN: Voluntary Chapter 11 Case Summary EP PROVIDENCE: Case Summary & 10 Largest Unsecured Creditors GAMETECH INTERNATIONAL: Case Summary & Creditors List GARLOCK SEALING: Asbestos Claimants Seek Sanctions Against Firm GENWORTH FINANCIAL: Moody's Assigns '(P)Ba1' Sub. Debt Rating GREAT OAKS: Voluntary Chapter 11 Case Summary GULF COLORADO: Case Summary & 20 Largest Unsecured Creditors HAMILTON BROKERAGE: Voluntary Chapter 11 Case Summary HAWKER BEECHCRAFT: Bank Debt Trades at 42% Off in Secondary Market HEALTH CARE REIT: Fitch Rates $1-Bil. Preferred Stock at 'BB+' HOMELAND SECURITY: YA Global Forbearance Extended to Aug. 31 HORIZON LINES: Board Grants CEO 3-Mil. Restricted Stock Units HOSPITAL AUTHORITY OF CHARLTON: Ch. 9 Dismissed, Not Converted INDYMAC BANCORP: Officers Settle Class Suit for $6.5 Million JOHN L SMITH: Failed Investments May Result in Bankruptcy Filing KLAL INC.: Case Summary & 3 Largest Unsecured Creditors KSK PLAZA: Case Summary & 6 Largest Unsecured Creditors KV PHARMACEUTICAL: FDA Issues Further Guidance About Makena LANDAMERICA 1031: 4th Cir. Affirms Ruling in Suit v. SunTrust LANDAMERICA FINANCIAL: Commonwealth to Pay $11MM to Settle Suit LAPOUR GRAND: To File for Chapter 11 Bankruptcy to Foil Receiver LEE'S FORD DOCK: Case Summary & 20 Largest Unsecured Creditors LEHMAN BROTHERS: Court Keeps Objection to JPMorgan Claim Intact LEHMAN BROTHERS: Asks for Flexibility in ADR Procedures LEHMAN BROTHERS: Opposes Agostini Trust's Bid to Recover Property LEHMAN BROTHERS: Opposes MM 156's $76-Mil. Loss of Profit Claim LEHMAN BROTHERS: AIG Says License Agreement Not a Lease LEHMAN BROTHERS: Objects to Laurel Cove, Logan Hotels Claims LEVEL 3: Board of Directors Modifies Committees Membership LON MORRIS COLLEGE: Case Summary & 20 Largest Unsecured Creditors MAH PROPERTIES: Case Summary & 5 Largest Unsecured Creditors METRO TOWER: Case Summary & 4 Largest Unsecured Creditors MICHIGAN FINANCE: Moody's Confirms 'Ca' Rating on 20-B Bonds MONTECITO AT MIRABEL: Files for Chapter 11 in Phoenix MONTGOMERY BANK: Closed; Ameris Bank Assumes All Deposits MORGAN'S FOODS: Posts $39,000 Net Income in May 20 Quarter MOTORS LIQUIDATION: Court OKs Amendment to GUC Trust Agreement NEDAK ETHANOL: In Default Under Arbor Bank Loan Agreement N.F.K.A. CORP: Case Summary & 20 Largest Unsecured Creditors OCEANSIDE YACHT: Case Summary & 20 Largest Unsecured Creditors OPTIMUMBANK HOLDINGS: Amends Stock Purchase Pact with M. Gubin PLAZA LATINA: Case Summary & 7 Largest Unsecured Creditors QUALITY DISTRIBUTION: To Issue 2MM Shares Under Incentive Plan RALPH ROBERTS: Court Wants Amendment to Plan Outline RANDI'S INC: Court Denies Approval of Chapter 11 Plan RESIDENTIAL CAPITAL: Files Schedules of Assets & Liabilities RESIDENTIAL CAPITAL: GMAC Mortgage Files Schedules RIVER GLIDER: Case Summary & 20 Largest Unsecured Creditors RIVIERA HOLDINGS: Moodys Cuts CFR to 'Caa2'; Outlook Negative ROTECH HEALTHCARE: Carter to Retire as President & CEO Dec. 31 SAFENET INC: Cancelled Dividend No Impact on Moody's 'B2' CFR SANKO STEAMSHIP: Chapter 15 Case Summary SANTA YSABEL: Has Green Light to Pay Wages & Other Bills SANTA YSABEL: Case Summary & 18 Largest Unsecured Creditors SDA INC: Strauss Auto Closes Stores, to File Liquidating Plan SEARS HOLDINGS: Edward Lampert Discloses 61.8% Equity Stake SHANTA CORP: Required to File Amendment to Plan Outline July 6 SHILLING PIPE: Case Summary & 20 Largest Unsecured Creditors SKINNY NUTRITIONAL: J. Arsenault Succeeds D. McDonald as CFO SOLUTIA INC: Moody's Lifts Rating on Sr. Unsecured Notes From B1 SOUTH EDGE: Meritage Action Should Be Heard in Nevada SPIRIT MOUNTAIN: Case Summary & 10 Largest Unsecured Creditors STANCORP FIN'L: Fitch Keeps 'BB+' Rating on Jr. Subordinated Debt SYNIVERSE HOLDINGS: Moody's Alters Ratings Outlook to Stable TALON THERAPEUTICS: Amends Investment Pact with Warburg, et al. TEJAL INVESTMENT: Voluntary Chapter 11 Case Summary THINES LLC: M&T Bank Has $726,800 Secured Claim TRANS ENERGY: Seven Directors Elected at Annual Meeting TRIBUNE CO: Bank Debt Trades at 33% Off in Secondary Market VALENCE TECHNOLOGY: Carl Warden Extends Debt Maturity to July 31 VUZIX CORP: LC Capital Discloses 14.8% Equity Stake VUANCE LTD: Posts $105,000 Net Income in First Quarter WEST END FINANCIAL: Judge Cuts Robinson Brog, Arent Fox Fees WESTERN BRIDGE: Closes Doors; NCUA's Resolution Plan Proceeds * Bankruptcy Filings Slide In 1st Half Of 2012, Report Says * McGuireWoods' Cox Jumps to Bradley Arant's Charlotte Office * BOND PRICING -- For Week From July 2 to 6, 2012 ********* 10 MAPLE ASSOC: Assets Not Encumbered by Sonoma Valley Loan ----------------------------------------------------------- Bankruptcy Judge Alan Jaroslovsky ruled that the two deeds of trust executed by an officer of 10 Maple Associates LLC to encumber the company's assets to secure that officer's personal loan with Sonoma Valley Bank were not enforceable by the bank due to lack of consideration and known lack of authority of the officer to execute them. Judge Jaroslovsky also held that, as a matter of law, Westamerica Bank, which acquired the assets of Sonoma Valley after it was taken over by the Federal Deposit Insurance Corp. in late 2010, has no more right to assert the validity of the deeds of trust than Sonoma Valley Bank and is subject to the same defenses. The Court said the two deeds of trust, executed in 2008 and in 2010, to be null and void and that Westamerica Bank has no right, title or interest in the real property of 10 Maple on account of those deeds of trust. 10 Maple shall also recover its costs of suit. Jeffrey Freiberg on June 18, 2008, borrowed $320,00 from Sonoma Valley Bank in the name of The Jeffrey L. Freiberg and Bonnie K. Freiberg Living Trust. The loan was for personal purposes completely unrelated to 10 Maple. Mr. Freiberg pledged 10 Maple's property as security, signing a deed of trust to 10 Maple's project. Mr. Freiberg signed the deed of trust 25 times, for each of the investors in 10 Maple, using the power of attorney. There was no evidence given to the Bank that the investors in 10 Maple consented to the encumbrance. In November 2009, 10 Maple became a Limited Liability Company. A new operating agreement was signed, making Mr. Freiberg the sole Managing Member. He was given exclusive authority to undertake any "mortgage or assignment as security of all or a substantial part of the Company's assets in connection with obtaining financing other than in the ordinary course of business of the Company." At the end of 2009, both Mr. Freiberg and Sonoma Valley Bank were struggling. The Bank approached Mr. Freiberg with the suggestion that he secured his outstanding personal obligations to the Bank by pledging the property of 10 Maple as security. This would have the dual effect of improving Mr. Freiberg's credit and improving the Bank's portfolio for bank examiners. On July 8, 2010, Mr. Freiberg, on behalf of 10 Maple (now an LLC), signed a deed of trust intending to collateralize several of his personal loans totaling $700,000. Mr. Freiberg had a very close relationship with Sonoma Valley Bank. When the bank was founded, Mr. Freiberg's father had been consulted and invited to invest in the Bank and be a member of its board of directors. Both Mr. Freiberg and his father had been among the initial investors in the Bank. Mr. Freiberg, now 66, was also a sophisticated real estate consultant, investor and developer. The case is 10 MAPLE ASSOCIATES, LLC, Plaintiff(s), v. WESTAMERICA BANK, Defendant(s), Adv. Proc. No. 11-1283 (Bankr. N.D. Calif.). A copy of the Court's July 3, 2012 Memorandum After Trial is available at http://is.gd/IVhLHpfrom Leagle.com. About 10 Maple Associates Based in Sonoma, California, 10 Maple Associates, LLC, was formed as a tenancy in common for tax reasons in 2006 and remained as such until late 2009, when it became a limited liability company. There were 15 investors in the project, taking title as tenants in common. 10 Maple filed for Chapter 11 bankruptcy (Bankr. N.D. Calif. Case No. 11-13639) on Sept. 30, 2011. Judge Alan Jaroslovsky oversees the case. Michael St. James, Esq., at St. James Law P.C., serves as the Debtor's counsel. In its petition, 10 Maple estimated assets and debts of $1 million to $10 million. The petition was signed by Leslie B. Seely, III, co-managing member. 11027 LEOPARD: Case Summary & 7 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: 11027 Leopard LLC 11027 Leopard Street Corpus Christi, TX 78410 Bankruptcy Case No.: 12-20354 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Southern District of Texas (Corpus Christi) Judge: Richard S. Schmidt Debtor's Counsel: Matthew A. Rosenstein, Esq. LAW OFFICES OF MATTHEW A. ROSENSTEIN 615 North Upper Broadway, Suite 720 Corpus Christi, TX 78401 Tel: (361) 883-5577 Fax: (361) 883-5590 E-mail: info@lawmar.net Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its seven largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txsb12-20354.pdf The petition was signed by Brad C. Hoke, managing director. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Brad C. Hoke, D.V.M. 12-20355 7/02/12 dba Nueces Veterinary Hospital AMERICAN NATURAL: Inks Financing Term Sheet for $3MM Debentures --------------------------------------------------------------- American Natural Energy Corporation has signed a Term Sheet with a private investment group for a financing consisting of a series of US$1 million Unsecured Convertible Debentures, up to a total of US$3 million. The financing is to be used for the drilling and completion of wells included in ANEC's inventory of Proved Undeveloped reserves. ANEC's PUDs include 11 locations on its Bayou Couba project in St. Charles Parish, Louisiana with potential reserves in excess of 2 million net barrels of oil. Each debenture will be due and payable two years from issuance, with interest payable quarterly at an equivalent rate of 12% per annum in either cash or common shares, and be convertible into shares of ANEC common stock at a conversion rate of US$0.10 per share. Warrants, expiring in two years and exercisable into common shares, will also be issued with the funding of each debenture equivalent to one warrant share for each converted share and will be exercisable into common shares at US$0.23 per share . The warrants are non-transferable. Holdings by the investment group, including conversion of shares and exercise of warrants is limited to 19.9% of the outstanding shares of ANEC without the approval of a majority of the outstanding existing shareholders. Completion of the funding under the Term Sheet is subject to completion of definitive documentation. Completion of this financing will also allow ANEC to draw an additional $2 million from the previously announced (Jan. 12, 2012) institutional investor financing. ANEC is a Tulsa, Oklahoma based independent exploration and production company with operations in St. Charles Parish, Louisiana. About American Natural American Natural Energy Corporation (TSX Venture: ANR.U) is a Tulsa, Oklahoma-based independent exploration and production company with operations in St. Charles Parish, Louisiana. The Company reported a net loss of $905,792 in 2011, compared with a net loss of $2.06 million in 2010. The Company's balance sheet at March 31, 2012, showed $17.15 million in total assets, $10.47 million in total liabilities and $6.67 million total stockholders' equity. In its audit report accompanying the 2011 financial statements, MaloneBailey, LLP, in Houston, Texas, 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 in 2011 and has a working capital deficiency and an accumulated deficit at Dec. 31, 2011. AMERICAN PATRIOT: Annual Meeting of Shareholders Set for Aug. 31 ---------------------------------------------------------------- American Patriot Financial Group, Inc., will hold its 2012 annual meeting of shareholders on Friday, Aug. 31, 2012. The 2012 Annual Meeting will be held more than 30 days after the anniversary of the 2011 Annual Meeting of Shareholders. As a result, pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended, the Company has set a revised deadline for the receipt of any shareholder proposals submitted pursuant to Rule 14a-8 for inclusion in the Company's proxy materials for the 2012 Annual Meeting. The new deadline for delivering shareholder proposals to the Company is the close of business on July 13, 2012, which date was determined in accordance with Rule 14a-8(e). Proposals should be addressed to the Company's Secretary at P.O. Box 610, Greeneville, Tennessee 37744. Any shareholder proposal requested to be included in the proxy materials for the 2012 Annual Meeting must comply with the requirements of Rule 14a-8 and other applicable law, or otherwise may be omitted from the proxy statement. About American Patriot Based in Greenville, Tenn., American Patriot Financial Group, Inc. is a one-bank holding company formed as a Tennessee corporation to own the shares of American Patriot Bank. The Bank is the only subsidiary of the Corporation. American Patriot Bank commenced operations as a state chartered bank on July 9, 2001. The Bank had total assets of roughly $118 million at Dec. 31, 2009. The Bank is not a member of the Federal Reserve System. The Bank's customer base consists primarily of small to medium- sized business retailers, manufacturers, distributors, land developers, contractors, professionals, service businesses and local residents. On Aug. 18, 2010, the Company received from the Federal Deposit Insurance Corporation, a Supervisory Prompt Corrective Action Directive, dated August 17, 2010, due to American Patriot Bank's "significantly undercapitalized" status. The Directive requires that the Bank submit an acceptable capital restoration plan on or before August 31, 2010, providing that, among other things, at a minimum, the Bank will restore and maintain its capital to the level of "adequately capitalized." In its audit report for the 2011 results, Hazlett, Lewis & Bieter, 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 incurred significant losses for the past five years resulting in a retained deficit of $7.15 million at Dec. 31, 2011. At Dec. 31, 2011 and 2010, the Company and its subsidiary were significantly undercapitalized based on regulatory standards and has consented to an Order to Cease and Desist with its primary federal regulator that requires, among other provisions, that it achieve regulatory capital thresholds that are significantly in excess of its current actual capital levels. The Company's nonperforming assets have increased significantly during 2011 and 2010 related primarily to deterioration in the credit quality of its loans collateralized by real estate. The Company, at the holding company level, has a note payable that was due Feb. 28, 2011, which is now in default. This note is securitized by 100 percent of the stock of the subsidiary. The Company reported a net loss of $1.18 million in 2011, compared with a net loss of $2.29 million in 2010. The Company's balance sheet at March 31, 2012, showed $92.82 million in total assets, $91.75 million in total liabilities and $1.06 million in total stockholders' equity. AMG CAPITAL: Fitch Affirms Securities Rating at 'BB-' ----------------------------------------------------- Fitch Ratings has completed a peer review of four rated Investment Managers (IMs), resulting in the affirmation of the long-term Issuer Default Ratings (IDRs) of Affiliated Managers Group Inc. (AMG), AllianceBernstein L.P. (AB), Invesco Ltd. (IVZ), and Schroders Plc (Schroders). Affirmed ratings are centered in the 'A' rating category, with the exception of AMG, which is rated 'BBB-'. Company-specific rating rationales are described below, and a full list of rating actions is provided at the end of this release. The Rating Outlook for all investment managers has been maintained at Stable. Many IMs have used have used the past two years to increase assets under management, improve relative investment performance, streamline expense base, reduce leverage, and fix any operational problems. Recent headwinds, including unsettled equity markets, near-zero interest rates, risks of renewed global recession, and ongoing turmoil in the Eurozone sector, could pose challenges for IMs. However, Fitch believes that improved or at least stable financial and operational flexibility should help most IMs maintain rating stability over the next year despite these headwinds. Affiliated Managers Group AMG's affirmation reflects its growing scale in the asset management space, solid investment performance by its affiliates, strong cash flow generation, and improving leverage and coverage ratios. Ratings also factor in the company's inherent exposure to volatility in broader financial markets. AMG's affiliates' assets under management (AUM) have more than doubled post-crisis, and measured $364 billion at the end of the first quarter (1Q'12), compared to $170 billion at year-end 2008. The increase has mainly come from strong organic growth ($120 billion) and partly from the six acquisitions made during the downturn ($70 billion). AMG has now generated positive flows for eight consecutive quarters, with approximately $40 billion in total net inflows in the past two years. Revenues and earnings have been solid as a result of higher average AUM and fee generation. Increased cash flows have led to consistent deleveraging. Leverage, measured as gross debt to trailing twelve months (TTM) adjusted EBITDA, was 2.1x at 1Q'12, down from 3.2x at year-end 2010. Interest coverage, measured as TTM adjusted EBITDA to interest expense, strengthened to 6.6x in 1Q'12, from 6.1x at year-end 2010. Fitch notes that leverage ratios are susceptible to temporary increases following large acquisitions. Demonstrated access to public debt markets, maintenance of current leverage, improvement in interest coverage, and consistent operating and investment performance could lead to positive rating action. Conversely, aggressive acquisitions funded by increased debt levels, material deterioration in leverage or interest coverage ratios, sustained investment underperformance at major affiliates, significant increase in equity puts by affiliates leading to liquidity issues, and/or unexpected operational losses or significant net outflows, could lead to negative rating action. AllianceBernstein: AB's ratings affirmations reflect its established position in the investment management space, strong debt and interest coverage metrics due to a modest use of leverage, and a balanced AUM mix by product, channel and geography. Rating constraints include sensitivity of AUM to global financial markets, subpar investment performance in its core equity strategies, and lagging operating margins. Revenues have declined due to lower average AUM and the shift in asset mix from equities to fixed income. EBITDA, adjusted for non- cash charges and one-time non-recurring expenses, measured $555.8 million in 2011, down 30% from $797.3 million in 2010. Expense reduction efforts have trailed revenue declines, pressuring operating margins. Fitch believes that significant top-line revenue growth is needed to push margins back to pre-crisis 25%- 30% levels. Fitch believes that AB's minimal use of balance sheet leverage provides the company significant financial flexibility and offers good protection to its creditors. AB's solid capital base offers a comfortable cushion to support organic growth of the business. Although, Fitch notes that AB has increased its use of seed capital investments to support new product development, which if not properly managed could impact capital levels. Fitch expects tight controls over management of these investments, and any further increase in the seed investments would be viewed negatively. The Stable Outlook reflects Fitch's expectation that the company will be able to maintain - if not improve - current AUM levels, generate consistent investment performance, and strengthen operating margins without materially increasing investment or balance sheet risk. Fitch will revise the Outlook or its ratings if: -- AUM levels drop below $375 billion, due to client outflows or negative investment performance; -- EBITDA, as calculated by Fitch and adjusted for non-cash and one-time charges, falls below $450 million. Additionally, material increase in seed capital balance or losses, and/or an increase in leverage could result in negative rating action. Upward ratings potential is limited due to AB's AUM, earnings, and cash flow sensitivity to financial market trends. Invesco Ltd.: IVZ's affirmation reflects robust operating performance, continued AUM growth, improved debt service coverage and leverage metrics and its low-risk balance sheet. Fitch believes IVZ will maintain reduced financial leverage as it focuses on organic growth and builds its available cash balance. The benefits of the Morgan Stanley/Van Kampen acquisition became apparent in 2011. IVZ improved its operating metrics as it benefitted from greater scale and diversity of AUM. Furthermore, IVZ's positive long-term fund flows have been supported by respectable investment performance. Adjusted operating margin was 36.9% in FY2011, up from 35.6% in FY2010. AUM was up 7.6% during 1Q'12, but has experienced declines in April and May due to risk aversion in global equity markets. IVZ has reduced leverage, and debt-to-adjusted TTM EBITDA stood at 1.0x at 1Q'12, down from 1.3x at YE2010. Interest coverage has also improved to 22.1x in 1Q'12, compared to 17.3x in YE2010. Both measures provide ample room under the company's covenants and compare favorably to peers. Fitch expects IVZ to be able to maintain performance appropriate to the current rating level, even under a moderate period of equity market stress. While positive rating momentum is not likely in the near term, continued progress in expanding the franchise as well as a further reduction in leverage and improvement in debt service coverage could benefit the ratings and/or Outlook. A severe and prolonged decline in equity markets could pressure the rating and/or Outlook, as well as unexpected operational losses or significant net redemptions. Schroders Plc: Schroders' IDRs reflect its well-diversified and strong franchise and sound, if volatile, profitability and cash generation in the context of its low overall leverage. Schroders itself has a liquid balance sheet and substantial capital resources (consolidated tangible equity/assets excluding insurance of around 34%) and no debt. Its private banking subsidiaries are strongly capitalized and have low overall credit and liquidity risk profiles. Like all IMs, Schroders' AUM and ultimately earnings and cash flow are inherently linked to financial markets, the group's investment performance relative to peers, and overall investor sentiment. The company is also exposed to operational and reputational risks. Despite this, in Fitch's opinion, Schroders' low overall leverage and its low risk appetite and conservative risk culture (Schroder Investment Management has an 'M1' Asset Manager Rating from Fitch) provide a significant cushion for creditors of the company. There is limited upside to Schroders' ratings, given their high level and the sensitivity of IM industry participants' AUM, earnings and cashflow to financial market trends and to firm- specific investment performance, which Fitch believes will inevitably oscillate over time. Schroders' ratings could be sensitive to a significant reduction in capitalization or material increase in leverage, for example as a consequence of a major acquisition or from material reputational damage or sustained weakening of performance or notable AUM net outflows. Fitch has affirmed the following: Affiliated Managers Group, Inc. -- Long-term IDR at 'BBB-'; -- Senior bank credit facility at 'BBB-'; -- Senior convertible notes at 'BBB-'. AMG Capital Trust I AMG Capital Trust II -- Trust preferred securities at 'BB-'. AllianceBernstein L.P. -- Long-term IDR at 'A+'; -- Short-term IDR at 'F1'; -- Short-term debt at 'F1'. Invesco Ltd. -- Long-term IDR at 'A-'; -- Senior unsecured debt at `A-'. Invesco Holding Company Ltd. -- Long-term IDR at 'A-'; -- Senior unsecured debt at `A-'; IVZ, Inc. -- Long-term IDR at 'A-'; -- Senior unsecured debt at `A-'; Schroders Plc -- Long-Term IDR at 'A+'; -- Short-Term IDR at 'F1' The Rating Outlook is Stable. ANCHOR BANCORP: Three Directors Resign from Board ------------------------------------------------- Messrs. Donald D. Kropidlowski, Greg M. Larson and Donald D. Parker retired from Anchor BanCorp Wisconsin Inc.'s Board of Directors effective June 30, 2012. Their retirements were not due to any dispute or disagreement with the Company or its Board of Directors or management. About Anchor Bancorp Madison, Wisconsin-based Anchor BanCorp Wisconsin Inc. is a registered savings and loan holding company incorporated under the laws of the State of Wisconsin. The Company is engaged in the savings and loan business through its wholly owned banking subsidiary, AnchorBank, fsb. Anchor BanCorp and its wholly-owned subsidiaries, AnchorBank fsb, each consented to the issuance of an Order to Cease and Desist by the Office of Thrift Supervision. The Corporation and the Bank continue to diligently work with their financial and professional advisors in seeking qualified sources of outside capital, and in achieving compliance with the requirements of the Orders. The Corporation and the Bank continue to consult with the successors to the OTS, Federal Reserve, the the Office of the Comptroller of the Currency and Federal Deposit Insurance Corporation on a regular basis concerning the Corporation's and Bank's proposals to obtain outside capital and to develop action plans that will be acceptable to federal regulatory authorities, but there can be no assurance that these actions will be successful, or that even if one or more of the Corporation's and Banks proposals are accepted by the Federal regulators, that these' proposals will be successfully implemented. While the Corporation's management continues to exert maximum effort to attract new capital, significant operating losses in fiscal 2009, 2010 and 2011, significant levels of criticized assets and low levels of capital raise substantial doubt as to the Corporation's ability to continue as a going concern. If the Corporation and Bank are unable to achieve compliance with the requirements of the Orders, or implement an acceptable capital restoration plan, and if the Corporation and Bank cannot otherwise comply with those commitments and regulations, the OCC or FDIC could force a sale, liquidation or federal conservatorship or receivership of the Bank. The Company reported a net loss of $36.73 million on $127.25 million of total interest income for the fiscal year ended March 31, 2012, a net loss of $41.17 million on $166.46 million of total interest income for the year ended March 31, 2011, and a net loss of $176.91 million on $217.08 million of total interest income for the year ended March 31, 2010. The Company's balance sheet at March 31, 2012, showed $2.78 billion in total assets, $2.81 billion in total liabilities and a $29.55 million total stockholders' deficit. McGladrey LLP, inMadison, Wisconsin, issued a "going concern" qualification on the consolidated financial statements for the fiscal year ended March 31, 2012. The independent auditors noted that all of the subsidiary bank's regulatory capital amounts and ratios are below the capital levels required by the cease and desist order. The subsidiary bank has also suffered recurring losses from operations. Failure to meet the capital requirements exposes the Corporation to regulatory sanctions that may include restrictions on operations and growth, mandatory asset dispositions, and seizure of the subsidiary bank. In addition, the Corporation's outstanding balance under the Amended and Restated Credit Agreement is currently in default. These matters raise substantial doubt about the ability of the Corporation to continue as a going concern. ARTE SENIOR LIVING: Files for Chapter 11 in Phoenix --------------------------------------------------- Arte Senior Living LLC, operator of an assisted living facility in North Scottsdale, Arizona, filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 12-14993) in Phoenix on July 5, 2012. The Debtor estimated assets and liabilities of $10 million to $50 million. The Debtor on the petition date filed motions to use cash collateral, access DIP financing and retain counsel. An expedited hearing on the financing is set for July 10, 2012 at 1:00 p.m. before Judge George B. Nielsen Jr. The Debtor is seeking approval to use income from the facility to pay expenses. The Debtor's primary lender, SMA Portfolio Owner LLC, claims an interest in the Debtor's income. Because the project income is not sufficient to pay expenses, the Debtor is also seeking approval of DIP financing to cover any shortfalls. SMA as of July 5 has not granted consent to the use of cash collateral. John J. Hebert, Esq., at Polsinelli Shughart, P.C., serves as counsel to the Debtor. According to the case docket, the schedules of assets and liabilities and statement of financial affairs are due July 19, 2012. A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled for Aug. 7, 2012 at 11:00 a.m. AS SEEN ON TV: Closes APA of AsSeenOnTV.com for $2.7 Million ------------------------------------------------------------ As Seen On TV, Inc., has officially closed its asset purchase of AsSeenOnTV.com. The aggregate purchase price of $2,722,000, consisted of cash, stock and warrants, and is significantly lower than the previously announced $5 million acquisition price. AsSeenOnTV.com is a highly trafficked destination Web site of direct response products with over two million customers, 700,000 email registrants and hundreds of thousands of unique visitors each month. Users of AsSeenOnTV.com generated $5.45 million in gross revenue in 2011 for Delivery Agent pursuant to its license agreement with AsSeenOnTV.com. Through the first half of 2012, the Web site generated approximately 40% gross revenue growth year-over-year. The Company will assume the license agreement with Delivery Agent, who operates the website. The license agreement calls for a 7.5% royalty of gross revenue to the owner of website, which is now As Seen On TV, Inc. Kevin Harrington, Chairman of As Seen On TV, Inc. stated, "We are thrilled to now own what we believe is a Crown Jewel of the direct response industry. AsSeenOnTV.com is the lone intellectual property in the expanding As Seen On TV category, and one we feel that is undervalued and underutilized." Steve Rogai, CEO of As Seen On TV, Inc. stated, "We look forward to working closer in partnership with Delivery Agent, an e- commerce leader, to enhance the capabilities and reach of the site. Our company has already prepared a new marketing and social media plan to further the growth and scope of AsSeenOnTV.com." Mary Beth Gearhart stated, "I am so proud to say that my late husbands' dear friend Kevin Harrington will own AsSeenOnTV.com. Kevin and Dan both shared a common vision and passion for the As Seen On TV brand. Kevin is a true leader in the direct response industry and he will build AsSeenOnTV.com to a level which it deserves." A copy of the Asset Purchase Agreement is available for free at: http://is.gd/h3fGL9 About As Seen on TV Clearwater, Fla.-based As Seen On TV, Inc., is a direct response marketing company. It identifies, develops, and markets consumer products. The Company reported a net loss of $8.07 million on $8.16 million of revenue for the year ended March 31, 2012, compared with a net loss of $6.97 million on $1.35 million of revenue during the prior fiscal year. The Company's balance sheet at March 31, 2012, showed $9.78 million in total assets, $27.05 million in total liabilities, all current, and a $17.26 million total stockholders' deficiency. ASARCO LLC: Union Pacific Fights Bid for Additional Cleanup Fees ---------------------------------------------------------------- Gavin Broady at Bankruptcy Law360 reports that Union Pacific Railroad Co. is fighting Asarco LLC's bid to force the company into providing additional contributions for cleanup efforts at an Idaho Superfund site, arguing Tuesday that the formerly bankrupt Asarco cannot request funds before its own liability obligations have been met. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection (Bankr. S.D. Tex. Case No. 05-21207) on Aug. 9, 2005. Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On Dec. 9, 2009, Asarco Incorporated and Americas Mining Corporation's Seventh Amended Plan of Reorganization for the Debtors became effective and the ASARCO Asbestos Personal Injury Settlement Trust was created and funded with nearly $1 billion in assets, including more than $650 million in cash plus a $280 million secured note from Reorganized ASARCO. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated ASARCO LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. BASE HOLDINGS: Dallas Court Orders Trial in Lease Dispute --------------------------------------------------------- Bankruptcy Judge Stacy G. C. Jernigan ruled on motions for partial summary judgment in the landlord-tenant rent dispute, CENTER OPERATING COMPANY, L.P., Plaintiff, v. BASE HOLDINGS, LLC., Defendant, Adv. Proc. No. 09-03256 (Bankr. N.D. Tex.). Center Operating Company sued Base for non-payment of rent. Base countered that the landlord breached the parties' contract, and also asserted fraud claims. Center Operating Company operates the American Airlines Center, a sports and special events complex near downtown Dallas, Texas, where the Dallas Mavericks NBA basketball team and the Dallas Stars NHL hockey team each play. The Arena anchors a larger development in Dallas known as Victory Park. Base Holdings was launched by entrepreneur Gilbert Aranza. It was a franchisee of the well-known restaurant corporation Brinker International, and was the operator of a Chili's Bar & Grill restaurant at the southwest corner of the American Airlines Center. The restaurant, however, operated for a mere nine months, starting in late 2008, before voluntarily seeking Chapter 11 bankruptcy relief, and then ultimately (and abruptly) closing. Base filed for Chapter 11 bankruptcy protection (Bankr. N.D. Texas Case No. 09-34269) on July 6, 2009. Davor Rukavina, Esq., at Munsch, Hardt, Kopf & Harr, served as the Debtor's counsel. The Company listed $1 million to $10 million in both assets and debts. Base moved to convert its Chapter 11 reorganization case to a Chapter 7 liquidation case, soon after the bankruptcy case and the adversary proceeding were filed. Robert Yaquinto was appointed the Chapter 7 Trustee. In its complaint, the landlord sought a determination as to how the defined term "Chili's Opening Date" should be interpreted in the lease agreement, for purposes of calculating all rent due. The Complaint also asked for certain other declarations regarding the parties' rights, status, and legal relations pursuant to the lease agreement. The landlord also filed a proof of claim for $1,595,918.83, for various amounts allegedly due to it under the agreement. In her ruling, Judge Jernigan denied Base's motion for summary judgment with respect to its claim. The judge granted, in part, and denied, in part, the landlord's own motion for summary judgment, rejecting Base's live tort counterclaims (i.e., fraud claims and negligence misrepresentation claim). The judge granted, in part, the landlord summary judgment as to Base's breach of contract claims. Specifically, the landlord is entitled to summary judgment on the alleged breaches asserted by Base that the landlord (i) failed to provide a Hillwood Parking Agreement and/or to fully resolve parking issues (such breach(es) not being material and, thus, precluding any recovery by Base due to its nonperformance of its obligation to pay rent), (ii) refused to allow Base to advertise and pass out handbills and coupons inside the Arena, and (iii) impeded the access of customers to the Restaurant by barricade. The judge denied the landlord's summary judgment motion, in part, as to Base's breach of contract claim alleging that the landlord improperly charged rent before Dec. 6, 2008. A trial on the merits is needed regarding when the "Chili's Opening Date" should be deemed to have occurred and, thus, when the landlord should be properly allowed to accrue rent. A copy of the Court's July 3, 2012 Memorandum Opinion is available at http://is.gd/NN6WuRfrom Leagle.com. Base was initially formed to develop a restaurant business (utilizing the Chili's concept, where possible) on military bases, and it even had contracts with the United States Navy and United States Army at one time. Apparently, any and all military contract rights and opportunities were transferred to a different entity, shortly before the bankruptcy filing. According to Judge Jernigan, the Court assumes that the Bankruptcy Trustee has been or will be fully investigating this. "In any event, this explains the unusual name 'Base Holdings, LLC,'" the judge said. BAYOU GROUP: Goldman Loses Appeal of $20.5MM Arbitration Award -------------------------------------------------------------- Edvard Pettersson at Bloomberg News reports that the U.S. Court of Appeals in Manhattan has affirmed a lower court's decision not to vacate the $20.5 million arbitration award by the Financial Industry Regulatory Authority in favor of Bayou Group LLC's creditors. As reported by the Troubled Company Reporter on Oct. 17, 2011, Liz Goldman Sachs Group Inc. filed an appeal in the in the Second Circuit from the award in a dispute with the creditors. The Wall Street Journal recounts that Bayou creditors accused Goldman Sachs Execution & Clearing LP, the clearing broker for Bayou, of ignoring several warning signs at the hedge fund run by Samuel Israel III before it imploded in 2005. The Financial Industry Regulatory Authority arbitration panel awarded the Bayou creditors $20.5 million in June 2010. Goldman sued to vacate the arbitration award in July 2010, but District Court Judge Jed Rakoff confirmed the award in November. About Bayou Group Based in Chicago, Illinois, Bayou Group LLC operated and managed hedge funds. The hedge fund that turned out to be a Ponzi scheme and a receiver was subsequently appointed. The Company and its affiliates were sent to Chapter 11 on May 30, 2006 (Bankr. S.D.N.Y. Lead Case No. 06-22306) to pursue recoveries for the benefit of defrauded investors. Elise Scherr Frejka, Esq., at Dechert LLP, represents the Debtors in their restructuring efforts. Joseph A. Gershman, Esq., and Robert M. Novick, Esq., at Kasowitz, Benson, Torres & Friedman, LLP, represent the Official Committee of Unsecured Creditors. Kasowitz, Benson, Torres & Friedman LLP is counsel to the Unofficial Committee of the Bayou Onshore Funds. Sonnenschein Nath & Rosenthal LLP represents certain investors. Bayou Group estimated assets and debts of more than $100 million in the Chapter 11 petition. Bayou has filed lawsuits against former investors who allegedly received fictitious profits and an inequitably large return of their principal investments. Jeff J. Marwil, Esq., at Jenner & Block, was appointed on April 28, 2006, as the federal equity receiver. The receiver commenced adversary proceedings to recover certain fraudulent transfers made by Bayou Group to investors. The Bayou fraud resulted in three guilty pleas. Daniel Marino, the head of finance, was sentence to a 20-year prison term despite his cooperation with prosecutors. James Marquez, a Bayou co-founder, was sentenced to four years and three months in prison and told to pay $6.2 million in restitution. Another founder, Samuel Israel III, was sentenced to 20 years following his guilty plea in September 2005. BIOZONE PHARMACEUTICALS: Issues $455,274 Convertible Notes ---------------------------------------------------------- BioZone Pharmaceuticals, Inc., on June 28, 2012, issued 10% convertible promissory notes with an aggregate principal amount of $455,274 and warrants to purchase 2,250,000 shares of the Company's common stock at an exercise price of $0.40 per share to certain holders of the Company's previously issued promissory notes with an aggregate amount of principle and accrued interest due as of that date equal to the aggregate principle amount of the Revised Notes. The Prior Notes have been cancelled. The Revised Notes bear interest at the rate of 10% per annum and mature two years from their issue date. The Company may prepay any outstanding amounts owing under the Revised Notes, in whole or in part, at any time prior to the maturity date. The entire remaining principal amount and all accrued but unpaid or unconverted interest thereof, is due and payable on the earlier of the maturity date or the occurrence of an Event of Default. The Revised Notes are convertible into shares of the Company's common stock at an initial conversion price of $0.20 per share. The Warrant is immediately exercisable and expires ten years after the date of issuance. The Warrant has an initial exercise price of $0.40 per share. The Warrant is exercisable in cash or by way of a "cashless exercise". The Company is prohibited from effecting a conversion of the Revised Notes or exercise of the Warrants, to the extent that as a result of such conversion or exercise, the holder would beneficially own more than 4.99% (subject to waiver) in the aggregate of the issued and outstanding shares of the Company's common stock, calculated immediately after giving effect to the issuance of shares of common stock upon conversion of the Revised Note or exercise of such Warrant, as the case may be. The Revised Notes and the Warrants were issued to "accredited investors," as that term is defined in the Securities Act of 1933, as amended, and were offered and sold in reliance on the exemption from registration afforded by Section 4(2) and Regulation D (Rule 506) under the Securities Act of 1933 and corresponding provisions of state securities laws. About Biozone Pharmaceuticals Biozone Pharmaceuticals, Inc., formerly, International Surf Resorts, Inc., was incorporated under the laws of the State of Nevada on Dec. 4, 2006, to operate as an internet-based provider of international surf resorts, camps and guided surf tours. The Company proposed to engage in the business of vacation real estate and rentals related to its surf business and it owns the website isurfresorts.com. During late February 2011, the Company began to explore alternatives to its original business plan. On Feb. 22, 2011, the prior officers and directors resigned from their positions and the Company appointed a new President, Director, principal accounting officer and treasurer and began to pursue opportunities in medical and pharmaceutical technologies and products. On March 1, 2011, the Company changed its name to Biozone Pharmaceuticals, Inc. Since March 2011, the Company has been engaged primarily in seeking opportunities related to its intention to engage in medical and pharmaceutical businesses. On May 16, 2011, the Company acquired substantially all of the assets and assumed all of the liabilities of Aero Pharmaceuticals, Inc., pursuant to an Asset Purchase Agreement dated as of that date. Aero manufactures markets and distributes a line of dermatological products under the trade name of Baker Cummins Dermatologicals. On June 30, 2011, the Company acquired the Biozone Labs Group which operates as a developer, manufacturer, and marketer of over- the-counter drugs and preparations, cosmetics, and nutritional supplements on behalf of health care product marketing companies and national retailers. In the auditors' report accompanying the financial statements for year ended Dec. 31, 2011, Paritz and Company. P.A., in Hackensack, N.J., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company does not have sufficient cash balances to meet working capital and capital expenditure needs for the next twelve months. In addition, as of Dec. 31, 2011, the Company has a shareholder deficiency and negative working capital of $4.37 million. The continuation of the Company as a going concern is dependent on, among other things, the Company's ability to obtain necessary financing to repay debt that is in default and to meet future operating and capital requirements. Biozone reported a net loss of $5.45 million in 2011, compared with a net loss of $319,813 in 2010. The Company's balance sheet at March 31, 2012, showed $8 million in total assets, $13.76 million in total liabilities and a $5.76 million total shareholders' deficiency. BONDS.COM GROUP: Hikes CFO's Annual Salary to $225,000 ------------------------------------------------------ Bonds.com Group, Inc., on July 5, 2012, and John Ryan, the Company's Chief Financial Officer, entered into an Amendment No. 1 to Mr. Ryan's existing Employment Agreement dated Feb. 2, 2011. Pursuant to the Amendment No. 1, Mr. Ryan's existing Employment Agreement was amended to: (1) eliminate Mr. Ryan's right to receive a performance bonus equal to 1% of the Company's EBITDA (which right would otherwise have applied at such time, if any, that the Company achieves four consecutive quarters of positive EBITDA and a minimum EBITDA of $5,000,000); and (2) increase Mr. Ryan's base salary from $175,000 per year to $225,000 per year. On June 28, 2012, the Board of Directors of the Company expanded the size of the Board to nine members and elected Marwan Khoueiri to the Board to fill the vacancy created by such expansion. Mr. Khoueiri was designated by Daher Bonds Investment Company and Mida Holdings and elected to the Board pursuant to the Company's Series E Stockholders' Agreement, dated as of Dec. 5, 2011, as amended by the Amendment No. 1 to Series E Stockholders' Agreement dated as of May 15, 2012. About Bonds.com Group Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG) -- http://www.bonds.com/-- through its subsidiary Bonds.com, Inc., serves institutional fixed income investors by providing a comprehensive zero subscription fee online trading platform. The Company designed the BondStation and BondStationPro platforms to provide liquidity and competitive pricing to the fragmented Over- The-Counter Fixed Income marketplace. The Company differentiates itself by offering through Bonds.com, Inc., an inventory of more than 35,000 fixed income securities from more than 175 competing sources. Asset classes currently offered on BondStation and BondStationPro, the Company's fixed income trading platforms, include municipal bonds, corporate bonds, agency bonds, certificates of deposit, emerging market debt, structured products and U.S. Treasuries. The Company reported a net loss of $14.45 million in 2011, compared with a net loss of $12.51 million in 2010. The Company's balance sheet at Dec. 31, 2011, showed $9.62 million in total assets, $14.85 million in total liabilities and a $5.23 million total stockholders' deficit. Daszkal Bolton LLP, in Boca Raton, Florida, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2011, citing recurring losses and negative cash flows from operations that raise substantial doubt about the Company's ability to continue as a going concern. BON-TON STORES: 71.1% of Outstanding Old Notes Validly Tendered --------------------------------------------------------------- The Bon-Ton Stores, Inc., announced the final results of the exchange offer and consent solicitation by The Bon-Ton Department Stores, Inc., the Company's wholly-owned subsidiary, for its outstanding 10 1/4% Senior Notes due 2014. As of the offer expiration time, which was 12:00 midnight, New York City time, on July 3, 2012, Bon-Ton Department Stores received tenders with consents from holders of approximately $330.0 million principal amount of Old Notes, representing approximately 71.1% of the outstanding Old Notes. At settlement, which is anticipated to occur on July 9, 2012, approximately $330.0 million principal amount of new 10 5/8% Second Lien Senior Secured Notes due 2017 will be issued. In addition, Bon-Ton Department Stores will enter into a supplemental indenture adopting the proposed amendments to the indenture under which the Old Notes were issued. Holders whose tendered Old Notes are accepted for exchange will also receive accrued and unpaid interest in cash on the exchanged Old Notes through, but not including, the settlement date for the exchange offer and consent solicitation. BofA Merrill Lynch acted as the sole dealer manager and solicitation agent for the exchange offer and consent solicitation. At closing, the New Notes will not be registered under the Securities Act of 1933, as amended, or any other applicable securities laws and, unless so registered, the New Notes may not be offered, sold, pledged or otherwise transferred within the United States or to or for the account of any U.S. person, except pursuant to an exemption from the registration requirements thereof. Accordingly, the New Notes are being offered and issued only (i) in the United States to "qualified institutional buyers", in a private transaction in reliance upon an exemption from the registration requirements of the Securities Act. Bon-Ton Department Stores will enter into a registration rights agreement pursuant to which, it will agree to use commercially reasonable efforts to consummate an exchange offer and, under certain circumstances, to file a shelf registration statement with respect to the New Notes. About Bon-Ton Stores The Bon-Ton Stores, Inc., with corporate headquarters in York, Pennsylvania and Milwaukee, Wisconsin, operates 276 department stores, which includes 11 furniture galleries, in 23 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's and Younkers nameplates and, in the Detroit, Michigan area, under the Parisian nameplate. Bon-Ton Stores reported $1.62 billion in total assets, $1.53 billion in total liabilities and $91.77 million in total shareholders' equity as of April 28, 2012. The Company incurred a net loss of $40.8 million on $640 million of net sales for the 13 weeks ended April 28, 2012. * * * As reported by the TCR on June 7, 2012, Moody's Investors Service affirmed The Bon-Ton Stores, Inc.'s Corporate Family Rating at Caa1 and lowered the company's Probability of Default Rating to Caa3 from Caa1. The rating action reflects the company's announcement that it has proposed to exchange a newly issued series of second lien notes due 2017 for its existing unsecured notes due in 2014. In the Jan. 12, 2012, edition of the TCR, Standard & Poor's Ratings Services lowered its corporate credit rating on Bon-Ton Stores Inc. to 'B-' from 'B'. "The downgrade reflects the continued deterioration of the company's performance, which has been below our expectations due to merchandising that has not resonated with its customers," said Standard & Poor's credit analyst David Kuntz. He added, "It incorporates our view that operations will remain weak in the near term and that credit protection measures will erode further over the next year." BRAD C. HOKE: Case Summary & 18 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Brad C. Hoke DVM PC dba Nueces Veterinary Hospital 11027 Leopard Street Corpus Christi, TX 78410 Bankruptcy Case No.: 12-20355 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Southern District of Texas (Corpus Christi) Judge: Richard S. Schmidt Debtor's Counsel: Matthew A. Rosenstein, Esq. LAW OFFICES OF MATTHEW A. ROSENSTEIN 615 North Upper Broadway, Suite 720 Corpus Christi, TX 78401 Tel: (361) 883-5577 Fax: (361) 883-5590 E-mail: info@lawmar.net Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 18 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txsb12-20355.pdf The petition was signed by Brad C. Hoke, president. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- 11027 Leopard, LLC 12-20354 07/02/12 CAESARS ENTERTAINMENT: Bank Debt Trades at 11% Off -------------------------------------------------- Participations in a syndicated loan under which Caesars Entertainment, Inc., is a borrower traded in the secondary market at 88.97 cents-on-the-dollar during the week ended Friday, July 6, 2012, an increase of 0.74 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 525 basis points above LIBOR to borrow under the facility. The bank loan matures on Jan. 1, 2018, and carries Moody's B2 rating and Standard & Poor's B rating. The loan is one of the biggest gainers and losers among 153 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Caesars Entertainment Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. --http://www.caesars.com/-- is one of the world's largest casino companies, with annual revenue of $4.2 billion, 20 properties on three continents, more than 25,000 hotel rooms, two million square feet of casino space and 50,000 employees. Caesars casino resorts operate under the Caesars, Bally's, Flamingo, Grand Casinos, Hilton and Paris brand names. The Company has its corporate headquarters in Las Vegas. Harrah's announced its re-branding to Caesar's on mid-November 2010. Caesars reported a net loss of $281.10 million on $2.27 billion of net revenues for the quarter ended March 31 2012. The Company incurred a net loss of $666.70 million in 2011, and a net loss of $823.30 million in 2010. The Company's balance sheet at March 31, 2012, showed $28.40 billion in total assets, $27.56 billion in total liabilities and $849.20 million in total equity. * * * As reported by the TCR on March 28, 2012, Moody's Investors Service upgraded Caesars Entertainment Corp's Corporate Family Rating (CFR) and Probability of Default Rating both to Caa1 from Caa2. The upgrade of Caesars' ratings reflects very good liquidity, an improving operating outlook for gaming in a number of the company's largest markets that is expected to drive earnings growth, the completion of a bank amendment that resulted in the extension of debt maturities to 2018 from 2015, and the public listing of the company's equity that increases financial flexibility by providing it with another potential source of capital. The upgrade of the SGL rating reflects minimal debt maturities over the next few years, significant cash balances (approximately $900 million at December 31, 2011) and revolver availability that will be more than sufficient to fund the company's cash interest and capital spending needs. CASA DE LUNA: Case Summary & 8 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Casa de Luna Properties, LP 2305 Lake Stone Cove Austin, TX 78738 Bankruptcy Case No.: 12-11510 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: Stephen W. Sather, Esq. BARRON & NEWBURGER, P.C. 1212 Guadalupe, Suite 104 Austin, TX 78701 Tel: (512) 476-9103 Ext. 220 Fax: (512) 476-9253 E-mail: ssather@bnpclaw.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 eight largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txwb12-11510.pdf The petition was signed by Todd A. Moon, authorized representative of general partner. CASTLEVIEW LLC: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Castleview, LLC 17 Beacon Hill Lane Greenwood Village, CO 80111-5244 Bankruptcy Case No.: 12-23954 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court District of Colorado (Denver) Judge: Howard R. Tallman About the Debtor: The Debtor owns a 252-acre residential development site located in Southeastern Castle Rock, Colorado, which property includes 245 residential lots. The property is worth $10.2 million and secures a $3.21 million debt. The Debtor is also entitled to bond proceeds from the Castleview Metropolitan District appraised at $6,248,724. The Debtor has a Chapter 11 plan that intends to pay creditors in full. Debtor's Counsel: Jeffrey Weinman, Esq. WEINMAN & ASSOCIATES, P.C. 730 17th Street, Suite 240 Denver, CO 80202 Tel: (303) 572-1010 E-mail: jweinman@epitrustee.com Scheduled Assets: $14,537,736 Scheduled Liabilities: $3,217,849 The petition was signed by Michael Blumenthal, manager. Debtor's List of Its Three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wallace Scott, P.C. -- $5,509 1430 Larimer Street, Suite 208 Denver, CO 80202-1709 White Bear Ankele, P.C. -- $2,471 2154 E. Commons Avenue, Suite 2000 Littleton, CO 80122-1880 Peak Civil Consultants, Inc. -- $2,196 200 W. Hampden Avenue, Suite 200 Englewood, CO 80110-2407 CDC CORP: Files First Amended Chapter 11 Plan, Disclosures ---------------------------------------------------------- BankruptcyData.com reports that CDC Corp. filed with the U.S. Bankruptcy Court a First Amended Chapter 11 Plan and related Disclosure Statement. According to the Disclosure Statement, "In summary, the Plan proposed by the Debtor and the Equity Committee provides for: (i) a distribution of existing cash on hand to creditors and equity holders of the Debtor; (ii) an orderly going concern sale of the remaining businesses owned by the Debtor and a distribution of the net cash proceeds received from those businesses to equity holders of the Debtor; (iii) payment in full plus postpetition interest to creditors with Allowed Claims; (iv) total distributions to holders of Allowed Equity Interests in an estimated range of approximately $5.01 to $6.10 per share; and (v) the pursuit of litigation claims against, among others, certain prior officers and directors of the Debtor, including, without limitation, the Debtor's former CEO, Mr. Peter Yip." About CDC Corp. Based in Atlanta, CDC Corp. (Nasdaq: CHINA) -- http://www.cdccorporation.net/-- is the parent company of CDC Software (Nasdaq: CDCS). CDC Software is based dually in Shanghai, China, and Atlanta and produces enterprise software applications, IT consulting services, outsourced applications development and IT staffing. The company's owners include Asia Pacific Online Ltd., Xinhua News Agency and Evolution Capital Management. CDC Corp., doing business as Chinadotcom, filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 11-79079) on Oct. 4, 2011. James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout, PA, in Atlanta, Georgia, serves as counsel. Moelis & Company LLC serves as its financial advisor and investment banker. Marcus A. Watson at Finley Colmer and Company serves as chief restructuring officer. The Debtor estimated assets and debts at US$100 million to US$500 million as of the Chapter 11 filing. The Official Committee of Equity Security Holders of CDC Corp. is represented by Troutman Sanders. The Committee tapped Morgan Joseph TriArtisan LLC as its financial advisor. The stock of CDC Software Corp. was sold for $249.8 million to an affiliate of Vista Equity Holdings. The Debtor's Plan provides that in addition to paying creditors in full and distributing the excess to shareholders, the plan would allow filing lawsuits against insiders who CDC claims were behind the motion to dismiss. China.com filed a competing reorganization plan. CDC interprets the plan as giving releases of claims that CDC's plan would prosecute instead. CEMEX SAB: Fitch Rates Proposed $500MM Senior Notes at 'B+/RR3' --------------------------------------------------------------- Fitch Ratings has assigned a 'B+/RR3' rating to CEMEX, S.A.B. de C.V.'s proposed senior secured high yield note issuance. These notes will be issued in an amount up to $500 million. These exchange notes are being offered to holders of the company's Financing Agreement debt in a cashless transaction and will have a maturity date of June 2018. The notes will be unconditionally guaranteed by CEMEX Mexico, S.A. de C.V., CEMEX Corp., CEMEX Concretos, S.A. de C.V., Empresas Tolteca de Mexico, S.A. de C.V., New Sunward Holding B.V., and CEMEX Espana, S.A. Additional guarantees will also be provided by the following sub-holding companies of CEMEX Espana -- CEMEX Research Group AG, CEMEX Shipping B.V., CEMEX Asia B.V., Cemex France Gestion, CEMEX UK and CEMEX Egyptian Investments B.V. The notes will be secured with a first priority interest over a collateral package consisting of substantially all of the shares of CEMEX Mexico, S.A. de C.V., Centro Distribuidor de Cemento, S.A. de C.V., Mexcement Holdings, S.A. de C.V., Corporacion Gouda, S.A. de C.V., CEMEX Trademarks Holding Ltd., New Sunward Holding B.V. and CEMEX Espana, S.A. Fitch currently rates CEMEX as follows: -- Foreign and local currency Issuer Default Rating 'B'; -- Senior unsecured notes 'B+/RR3'; -- National scale long-term rating 'BB-(mex)'; -- National scale short-term rating 'B (mex)'. The Rating Outlook is Stable. The 'B' ratings of CEMEX and its subsidiaries reflect the company's high leverage and the weak, near-term cash flow prospects for two of the company's three key markets -- the United States and Spain. Additional risks include high refinancing risk, the potential for weaker performance of the company's Mediterranean division - consisting primarily of Egypt and Spain - and negative economic growth in the Euro region, which could impact its profitable Northern European division. The 'RR3' Recovery Rating (RR) on the company's unsecured debt indicates above average recovery prospects for holders of the proposed notes in the event of default. The collateral package for the proposed notes is similar to that for the debt associated with the Aug. 14, 2009 Financing Agreement, as well as most of the company's capital markets debt. On June 25, 2012, CEMEX announced its intent to refinance $7.2 billion of debt associated with its Financing Agreement. Approximately $500 million of this debt falls due during 2013 and $6.7 billion matures in 2014. As part of the refinancing proposal, CEMEX is attempting to loosen the financial covenants and to extend the maturity of the debt through 2017. The proposed senior secured exchange notes are part of this refinancing proposal. CEMEX had $18.2 billion of total debt and $1 billion of cash and marketable securities as of March 31, 2012. Debt amortizations during the second half of 2012 total $39 million. Debt amortizations during 2013 and 2014 are $638 million and $7.5 billion, respectively. The company generated $2.3 billion of EBITDA during 2011, a level similar to the amount generated in 2010. Mexico is the company's most important market, representing $1.2 billion of EBITDA. The company's next most important markets during 2011 were the Central and South American region ($513 million of EBITDA in 2011), the Mediterranean ($439 million) and Northern Europe ($416 million). During the first quarter of 2012, the company had relatively strong performances from its Mexican and Central and South American division, while there was deterioration in its Mediterranean and Northern European divisions. A marked deterioration of the economic environment in the Northern European division - consisting mainly of France, Germany, the U.K. and Poland - could lead to a negative rating action. Weakness in the Mexican market could also lead to a negative rating action, as could an unsuccessful attempt at the restructuring of the Financing Agreement debt. A positive rating action is unlikely until there is an improvement in the anemic U.S. economy. On a pro forma basis (as though Rinker was consolidated), Fitch estimates that CEMEX generated $2.3 billion of EBITDA in the U.S. during 2006. This compares with a negative EBITDA of $100 million in 2011. CHARLES M. BREWER: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Charles M. Brewer, Ltd. 5500 North 24th Street Phoenix, AZ 85016-3130 Bankruptcy Case No.: 12-14957 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Eileen W. Hollowell Debtor's Counsel: Daniel E. Garrison, Esq. ANDANTE LAW GROUP OF DANIEL E. GARRISON Scottsdale Financial Center I 4110 North Scottsdale Road, Suite 330 Scottsdale, AZ 85251 Tel: (480) 421-9449 Fax: (480) 522-1515 E-mail: dan@andantelaw.com Estimated Assets: $1,000,001 to $10,000,001 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/azb12-14957.pdf The petition was signed by Charles M. Brewer, president/director Previous Chapter 11 filing by related entity: Petition Debtor Case No. Date ------ -------- ---- Charles M. Brewer 11-27322 09/26/11 CHINA TEL GROUP: Ironridge Global Discloses 9.9% Equity Stake ------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Ironridge Global IV, Ltd., and its affiliates disclosed that, as of July 3, 2012, they beneficially own 117,000,000 shares of common stock of Velatel Global Communications, Inc., formerly known as China Tel Group, Inc., representing 9.99% of the shares outstanding. A copy of the filing is available at http://is.gd/uY9BsD About China Tel Based in San Diego, California, and Shenzhen, China, China Tel Group, Inc. (OTC BB: CHTL) -- http://www.ChinaTelGroup.com/-- provides high speed wireless broadband and telecommunications infrastructure engineering and construction services. Through its controlled subsidiaries, the Company provides fixed telephony, conventional long distance, high-speed wireless broadband and telecommunications infrastructure engineering and construction services. ChinaTel is presently building, operating and deploying networks in Asia and South America: a 3.5GHz wireless broadband system in 29 cities across the People's Republic of China with and for CECT-Chinacomm Communications Co., Ltd., a PRC company that holds a license to build the high speed wireless broadband system; and a 2.5GHz wireless broadband system in cities across Peru with and for Perusat, S.A., a Peruvian company that holds a license to build high speed wireless broadband systems. After auditing the 2011 results, Kabani & Company, Inc., in Los Angeles, California, expressed substantial doubt as to the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred a net loss for the year ended Dec. 31, 2011, cumulative losses of $254 million since inception, a negative working capital of $16.4 million and a stockholders' deficiency of $9.93 million. The Company reported a net loss of $21.79 million in 2011, compared with a net loss of $66.62 million in 2010. The Company's balance sheet at March 31, 2012, showed $13.57 million in total assets, $19.53 million in total liabilities and a $5.95 million total stockholders' deficiency. CLAMAR ENTERPRISES: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Clamar Enterprises, LLC dba La Mansion Restaurant 413 E. Wisteria Avenue McAllen, TX 78504 Bankruptcy Case No.: 12-70401 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Southern District of Texas (McAllen) Judge: Richard S. Schmidt Debtor's Counsel: Antonio Villeda, Esq. LAW OFFICES OF ANTONIO VILLEDA 5414 N. 10th Street McAllen, TX 78504 Tel: (956) 631-9100 E-mail: avilleda@mybusinesslawyer.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Claudia Martinez, president. CLEAR CHANNEL: Bank Debt Trades at 20% Off in Secondary Market -------------------------------------------------------------- Participations in a syndicated loan under which Clear Channel Communications, Inc., is a borrower traded in the secondary market at 79.81 cents-on-the-dollar during the week ended Friday, July 6, 2012, an increase of 0.74 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 365 basis points above LIBOR to borrow under the facility. The bank loan matures on Jan. 30, 2016, and carries Moody's 'Caa1' rating and Standard & Poor's 'CCC+' rating. The loan is one of the biggest gainers and losers among 153 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Clear Channel San Antonio, Texas-based CC Media Holdings, Inc. (OTC BB: CCMO) -- http://www.ccmediaholdings.com/-- is the parent company of Clear Channel Communications, Inc. CC Media Holdings is a global media and entertainment company specializing in mobile and on-demand entertainment and information services for local communities and premier opportunities for advertisers. The Company's businesses include radio and outdoor displays. Clear Channel had a net loss of $143.63 million on $1.36 billion of revenue for the three months ended March 31, 2012. It reported a net loss of $302.09 million on $6.16 billion of revenue in 2011, compared with a net loss of $479.08 million on $5.86 billion of revenue in 2010. The Company had a net loss of $4.03 billion on $5.55 billion of revenue in 2009. The Company's balance sheet at March 31, 2012, showed $16.48 billion in total assets, $24.29 billion in total liabilities, and a $7.80 billion total members' deficit. At March 31, 2012, the Company had $20.7 billion of total indebtedness outstanding. Bankruptcy Warning The Company said in its quarterly report for the period ended March 31, 2012, that its ability to restructure or refinance the debt will depend on the condition of the capital markets and the Company's financial condition at that time. Any refinancing of the Company's debt could be at higher interest rates and increase debt service obligations and may require the Company and its subsidiaries to comply with more onerous covenants, which could further restrict the Company's business operations. The terms of existing or future debt instruments may restrict the Company from adopting some of these alternatives. These alternative measures may not be successful and may not permit the Company or its subsidiaries to meet scheduled debt service obligations. If the Company and its subsidiaries cannot make scheduled payments on indebtedness, the Company or its subsidiaries, as applicable, will be in default under one or more of the debt agreements and, as a result the Company could be forced into bankruptcy or liquidation. * * * The Troubled Company Reporter said on Feb. 10, 2012, Fitch Ratings has affirmed the 'CCC' Issuer Default Rating of Clear Channel Communications, Inc., and the 'B' IDR of Clear Channel Worldwide Holdings, Inc., an indirect wholly owned subsidiary of Clear Channel Outdoor Holdings, Inc., Clear Channel's 89% owned outdoor advertising subsidiary. The Rating Outlook is Stable. Fitch's ratings concerns center on the company's highly leveraged capital structure, with significant maturities in 2014 and 2016; the considerable and growing interest burden that pressures free cash flow; technological threats and secular pressures in radio broadcasting; and the company's exposure to cyclical advertising revenue. The ratings are supported by the company's leading position in both the outdoor and radio industries, as well as the positive fundamentals and digital opportunities in the outdoor advertising space. CONSTELLATION BRANDS: Fitch Affirms 'BB+' LT Issuer Default Rating ------------------------------------------------------------------ Fitch Ratings has affirmed the ratings for Constellation Brands, Inc. (STZ) as follows, upon STZ's definitive agreement with Anheuser Busch InBev (AB InBev) to purchase the remaining 50% interest in Crown Imports LLC (Crown): -- Long-term IDR at 'BB+'; -- Secured bank credit facility at 'BB+'; -- Senior unsecured notes at 'BB+'. The Rating Outlook is Stable. This rating action affects approximately $3.4 billion of debt at May 31, 2012. Fitch believes there is good strategic rationale for the transaction, given the importance of Crown's cash flows to Constellation's credit profile, the growth of imported beer sales in the U.S., and the strength of the Corona brand. The purchase price for the remaining 50% interest in Crown is $1.85 billion. This values the Crown distribution business at approximately 8.5x Crown's fiscal 2012 EBIT of $431 million. The transaction, subject to regulatory approval, is expected to close during the first quarter of calendar 2013. STZ has fully committed bridge financing in place for the acquisition. Permanent financing is expected to consist of a combination of revolver borrowings, a new term loan under the company's current senior credit facility and the issuance of new notes. Constellation has also agreed to purchase the Mark West wine brand for $160 million, to be financed by revolver borrowings. Upon closing, the transaction is expected to increase debt to EBITDA to the mid-4x range when factoring in a full year of the additional Crown EBITDA. In the first quarter of fiscal 2013, Constellation completed $383 million of share repurchases under its $1 billion authorization but has suspended its share repurchases for the remainder of fiscal 2013 in order to use FCF to restore total debt-to-EBITDA back to its targeted 3-4x range within 12 months of the acquisition closing. Fitch believes Constellation can generate annual FCF in excess of $600 million post the closing of the Crown transaction, based on the estimated after-tax EBIT and the expectation of minimal additional capital requirements, and therefore views this level of deleveraging as achievable. STZ accounted for its current 50% interest in Crown under the equity method and recognized $215 million of equity earnings in Crown in fiscal 2012. Upon completion of the transaction STZ plans to consolidate the full financial results of Crown. Fitch had included equity method earnings from Crown in EBITDA since cash distributions were roughly equivalent and STZ exercises a considerable amount of control of Crown. STZ and Crown will control the distribution, marketing and pricing for all Modelo brands in the U.S., while AB InBev will ensure continuity of supply, product quality and innovation. The new importation agreement will be perpetual and provides AB InBev with the right, but not the obligation, to exercise a call option every 10 years, subject to regulatory approval, at a multiple of 13x Crown's EBIT from the Modelo brands. STZ's ratings and Outlook reflect the company's leading global market positions and well-known portfolio of wine, spirits and beer brands, as well as its significant free cash flow (FCF). The ratings balance the general stability of the company's operations, good operating margins and ample free cash flow generation with its acquisitive nature and near term increase in leverage. Fitch does not anticipate upgrades to STZ's ratings in the near to intermediate term. Negative rating actions are possible if a significant and ongoing deterioration in operating results occur or the company does not reduce leverage back to the 3-4x range within 12-18 months. The company generates a substantial amount of FCF as evidenced by its averaging over $450 million in FCF annually the past five years. Fitch believes STZ's expectation of producing between $425 million and $475 million in FCF in fiscal 2013 is very achievable. STZ has used a combination of FCF and divestitures to reduce debt to $3.4 billion from a peak of almost $5.3 billion at May 31, 2008. STZ's North American shipment volume decreased 0.8% for the fiscal year ended Feb. 29, 2012 due to an overlap of the 2011 distributor inventory build as part of the company's U.S. distributor consolidation. Fitch anticipates wine category growth in calendar 2012 will be in the low single digits and expects STZ's volume growth to be in line with industry. Crown Imports had a good year with mid-single digit growth of depletions and domestic category depletion continuing to decline in the low single digits. Fitch forecasts 2012 U.S. beer category growth will be flat to down low single digits and expects Crown Imports volume to grow in the low single digits. Fitch believes this will translate into modest operating income growth. STZ's liquidity remains adequate. As of May 31, 2012, the company's liquidity includes approximately $800 million of availability under its revolving credit facility due in May 2017 and $69.1 million of cash and equivalents. Maturities of long-term debt in fiscal 2013, 2014, and 2015 were $315.1 million, $314.1 million, and $599.7 million, respectively, at the fiscal year ended Feb. 29, 2012. Fitch believes the security of the credit facility, being equity in subsidiaries rather than hard assets, is relatively weak and therefore has chosen not to distinguish between the secured credit facility rating and the senior unsecured notes rating at the current rating level. STZ's capital structure does not provide an advantage structurally to any one issue. STZ is the issuer of all the company's notes outstanding and the borrower under its credit agreements for its facilities. CORD BLOOD: Issues $1.2 Million Convertible Note to Tonaquint ------------------------------------------------------------- In a transaction that closed on June 29, 2012, Cord Blood America, Inc., entered into a Securities Purchase Agreement with Tonaquint, Inc., whereby the Company issued and sold, and the Investor purchased a Secured Convertible Promissory Note of the Company in the principal amount of $1,252,000. The Company Note was issued June 27, 2012, and is due 20 calendar months after the issuance date. The Company Note has an interest rate of 6.0%, which would increase to a rate of 18.0% on the happening of certain Events of Default, including but not limited to: failure to pay and the failure by the Company or its transfer agent to deliver Conversion Shares within 3 Trading Days of the Company's receipt of a Conversion Notice. The total amount funded in cash at closing was $1,120,000, representing the Maturity Amount less an original issue discount of $112,000 and the payment of $20,000 to the Investor to cover its fees. Along with the Securities Purchase Agreement and the Company Note, the parties also entered into a Security Agreement and Irrevocable Instructions to Transfer Agent, and the Company executed a Consent to Entry of Judgment by Confession. A copy of the Securities Agreement is available for free at: http://is.gd/uVVx7X Transaction with JMJ Financial JMJ Financial previously issued to the Company several "Secured & Collateralized Promissory Notes," namely documents numbered as follows: C-12172009b; C-03012010a; C-03012010b; and C- 11192010a. Concurrently with the issuance of each of the JMJ Notes, the Company issued to JMJ corresponding "Convertible Promissory Notes," specifically documents numbered as follows: B-12172009b, B-03012010a, B-03012010b, and B-11192010a. On June 29, 2012, the Company closed a transaction with JMJ pursuant to a Final and Full Payment Agreement executed by these parties. The JMJ Agreement relates to the JMJ Notes and the Company Notes, as well as to the Feb. 8, 2011, settlement agreement between JMJ and the Company, but also includes release and cancellation provisions pertaining to any other notes, claims, documents or other rights that may have existed between the parties. Pursuant to the JMJ Agreement, JMJ surrendered the remainder of $1,919,950 total from the Company Notes, as full payment of the pay-off amounts of the JMJ Notes. Accordingly, JMJ no longer owes the Company any money under the JMJ Notes, and no longer has the ability to provide the Company with money under the JMJ Notes, which the Company would have been required to repay in accordance with the terms of the corresponding Company Notes. Further pursuant to the JMJ Agreement, the Company paid JMJ $1,117,730, which was the amount outstanding and owed by the Company under the Company Notes, including the February 2011 Settlement Agreement. This amount represented amounts advanced by JMJ under the JMJ Notes and not yet repaid by the Company through conversions of the Company's common stock or otherwise. A copy of the Final Payment Agreement is available for free at: http://is.gd/YQazSu About Cord Blood America Based in Las Vegas, Nevada, Cord Blood America, Inc., is primarily a holding company whose subsidiaries include Cord Partners, Inc., CorCell Co. Inc., CorCell Ltd.; CBA Professional Services, Inc. D/B/A BodyCells, Inc.; CBA Properties, Inc.; and Career Channel Inc, D/B/A Rainmakers International. Cord specializes in providing private cord blood stem cell preservation services to families. BodyCells is a developmental stage company and intends to be in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy. Properties was formed to hold the corporate trademarks and other intellectual property of CBAI. Rain specializes in creating direct response television and radio advertising campaigns, including media placement and commercial production. After auditing the 2011 results, Rose, Snyder & Jacobs, LLP, in Encino, California, expressed substantial doubt substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has sustained recurring operating losses, continues to consume cash in operating activities, and has insufficient working capital and an accumulated deficit at Dec. 31, 2011. Cord Blood reported a net loss attributable to the Company of $5.97 million in 2011, compared with a net loss attributable to the Company of $8.09 million in 2010. The Company's balance sheet at March 31, 2012, showed $7.41 million in total assets, $7.31 million in total liabilities and $101,042 in total stockholders' equity. COUNTRYWIDE FIN'L: Allegedly Used Loan Program to Sway Congress --------------------------------------------------------------- A report from the House of Representatives' Oversight and Government Reform Committee was released on Thursday saying that Countrywide Financial Corp. used its VIP mortgage program to influence lawmakers to kill legislation that could hurt the Company's profits, Reuters states. Reuters relates that the congressional report named dozens of congressional staffers -- including top government officials and executives of government-controlled mortgage company Fannie Mae -- that benefited from the VIP mortgage program, which offered discount loans to "VIPs". The congressional report, according to Reuters, stated that hundreds of loans, which often had reduced interest rates and eliminated certain fees, were granted between 1991 and 2008 through the VIP program. The congressional report said that Countrywide VIPs were able to "affect dozens of pieces of legislation" being considered in Congress in the years leading up to 2007, including measures to reform giant mortgage companies Fannie Mae and Freddie Mac, Reuters relates. Countrywide chief executive, Angelo Mozilo, in a letter provided by his lawyer, denied using the VIP program to influence policy decisions and said that he did not recall many of the details about the origination and the pricing of those loans, Reuters reports. "The VIP unit primarily gave focused customer support and cost-effective processing and service. I personally was proud to have people of prominence select Countrywide to be their lender of choice," Reuters quoted Mr. Mozilo as saying. Based in Calabasas, California, Countrywide Financial Corporation (NYSE: CFC) -- http://www.countrywide.com/-- originated, purchased, securitized, sold, and serviced residential and commercial loans. In mid-2008, Bank of America completed its purchase of Countrywide for $2.5 billion. The mortgage lender was originally priced at $4 billion, but the purchase price eventually was whittled down to $2.5 billion based on BofA's stock prices that fell over 40% since the time it agreed to buy the ailing lender. COWBOY CIAO: Restaurant Files for Chapter 11 Bankruptcy Protection ------------------------------------------------------------------ Stephanie Russo at The Republic reports that Cowboy Ciao restaurant has filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code in Arizona. According to the report, owner Peter Kasperski owes the state of Arizona more than $1.1 million. He also owes nearly $4 million to 19 creditors for the restaurant, including ANB Bank nearly $60,000, the Arizona Department of Revenue more than $1.1 million, the U.S. Internal Revenue Service $500,000, other businesses, private figures, and family members. The creditors will meet on July 31, according to the report. The report, citing court documents, says Cowboy Ciao LLC's assets are estimated to be between $100,000 to $500,000. Cowboy Ciao LLC operates a restaurant, which combines Tex-Mex and Italian food. CULLIGAN INT'L: Bank Debt Trades at 16% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which Culligan International Co. is a borrower traded in the secondary market at 84.00 cents-on-the-dollar during the week ended Friday, July 6, 2012, an increase of 0.80 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 225 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 16, 2012, and carries Moody's Caa2 rating. The loan is one of the biggest gainers and losers among 153 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Culligan International Culligan International Co. is a water services provider based in Rosemont, Illinois. The company distributes its products primarily through an extensive dealer network. * * * As reported by the Troubled Company Reporter on July 2, 2012, Moody's Investors Service has lowered Culligan International Company's probability of default rating to D following its exchange of its first lien term loan for cash and new first and second lien term loans. As part of this transaction, the second lien debt was exchanged for equity of the post exchange entity. Moody's views this exchange as distressed in accordance with its definition of default. All ratings on Culligan will be withdrawn following this action since the debt restructuring has eliminated all rated debt. The TCR, on May 25, 2012, reported that Standard & Poor's Ratings Services lowered its corporate credit rating on Rosemont, Ill.- based Culligan International Co. to 'CC' from 'CCC+'. The outlook is negative. "At the same time, we lowered our issue-level rating on the company's first-lien term loans due November 2012 to 'CC' from 'CCC+'. The recovery rating on this debt remains '4', indicating our expectation for average (30% to 50%). We also lowered our issue-level rating on the company's second-lien term loan due May 2013 to 'C', from 'CCC-'. The recovery rating on this debt remains '6', indicating our expectation for negligible recovery (0% to 10%) in the event of a payment default. Subsequent to these ratings actions, we withdrew all ratings at the company's request," S&P said. "Standard & Poor's rating actions follow Culligan's proposal to its lenders to exchange its existing first- and second-lien term loans for a combination of new loans, cash, and equity at a total consideration of less than 100% of principal plus accrued interest," S&P said. "Based on our criteria, we view the transaction as a distressed offer," said Standard & Poor's credit analyst Rick Joy. DAVID KIRCHER: Failure to Amend Plan Prompts Chapter 7 Conversion ----------------------------------------------------------------- Bankruptcy Judge Thomas J. Tucker converted the Chapter 11 case of David James Kircher to a liquidation under Chapter 7 of the Bankruptcy Code after the Debtor failed to adhere to a court order requiring him to submit an amended combined plan and disclosure statement by June 28. David Kircher filed for Chapter 11 protection (Bankr. E.D. Mich. Case No. 12-42718) on Feb. 8, 2012. On March 7, on motion of the Debtor, the Court ordered the appointment of a Chapter 11 Trustee. Douglas Ellmann was so appointed on March 19. On March 7, 2012, after holding a scheduling conference, the Court entered a scheduling order for the case. Among other things, that Order required the Debtor to file a combined plan and disclosure statement no later than June 7, 2012. On April 6, 2012, the Chapter 11 Trustee filed a motion to convert this case to Chapter 7. The Debtor (and only the Debtor) objected. On May 9, 2012, after holding a hearing on the Conversion Motion, the Court entered an order conditionally denying that motion. The May 9 Order stated, in relevant part, provided that, if the Debtor or any other party in interest files a combined plan and disclosure statement on or before June 7, 2012, then the Motion will be deemed denied. Otherwise, the Motion will be granted, and the Court will enter an order converting the case to Chapter 7 on June 8. On June 7, the Debtor filed a combined plan and disclosure statement. On June 21, the Court entered a detailed order requiring the Debtor to amend the Disclosure Statement by June 28, citing problems. The Debtor did not comply with this requirement. Instead, on June 28, the Debtor filed a notice simply withdrawing the June 7 Plan. The Debtor, therefore, no longer has any Chapter 11 plan pending before the Court. Nor does any other party in interest. The Debtor's exclusive right to file a plan during the first 120 day of this case, under 11 U.S.C. Sec. 1121(b), ended on March 19, 2012, when the Chapter 11 Trustee was appointed. Thereafter, any party in interest has been able to file a plan. No such party has done so. The Court said it is in the best interests of the creditors and the estate that the case be converted to Chapter 7, effective immediately. A copy of the Court's June 29, 2012 Order is available at http://is.gd/p2iVIVfrom Leagle.com. David Kircher owns 36 properties in Ypsilanti and Ypsilanti Township, Michigan, which are valued at roughly $5.6 million. Of those, 10 are owned by Mr. Kircher's Acme Building Company, and around 10 Ypsilanti Township properties are headed to tax foreclosure this month. Annarbor.com reports Mr. Kircher's only income is listed as $2,100 monthly from rental revenue, but he listed a net income of negative $2,608. Annarbor.com also reports Mr. Kircher is serving his term in state prison in Jackson for illegally diverting raw sewage into the Huron River via a public sewer from the Eastern Highlands apartment complex he owned. Ypsilanti Township officials discovered Mr. Kircher was dumping sewage there in 2004. The report adds Mr. Kircher holds $2.7 million in debt. DAVINCI ESTATES: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: DaVinci Estates, LP P.O. Box 260329 Plano, TX 75026 Bankruptcy Case No.: 12-34357 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Stacey G. Jernigan Debtor's Counsel: Herman A. Lusky, Esq. LUSKY & ASSOCIATES, P.C. 12720 Hillcrest Road, Suite 280 Dallas, TX 75230 Tel: (972) 386-3900 Fax: (800) 208-6389 E-mail: mail@lusky.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Saeid Davani, manager of the general partner. DELTA PETROLEUM: Wins Court Approval of Disclosure Statement ------------------------------------------------------------ Jamie Santo at Bankruptcy Law360 reports that Delta Petroleum Corp. won approval Thursday for its disclosure statement, clearing the way for creditors to vote on a Chapter 11 reorganization plan that entails a joint venture with Laramie Energy II LLC, a fellow Denver-based natural gas exploration and development company. Bankruptcy Law360 relates that Delta attorney Kathryn A. Coleman told the Delaware court that while there had been a number of comments on and objections to the statement, most had been addressed by incorporating them into the plan, though the language still needed to be finalized. BankruptcyData.com reported that Delta Petroleum's official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to Disclosure Statement. The committee stated, "As a result of its recent appointment, the Committee is still in the process of reviewing the Disclosure Statement, the Plan and the other Plan Documents, as well as the various transactions contemplated by the Plan. Based on the Committee's preliminary review, however, the Disclosure Statement does not provide adequate information such that creditors entitled to vote on the Plan can make an informed decision to either accept or reject the Plan as is required under Bankruptcy Code section 1125. In addition, the Committee has identified several provisions in the Plan that should be modified prior to any solicitation of votes thereof." About Delta Petroleum Delta Petroleum Corporation (NASDAQ: DPTR) is an independent oil and gas company engaged primarily in the exploration for, and the acquisition, development, production, and sale of, natural gas and crude oil. Natural gas comprises over 90% of Delta's production services. The core area of its operations is the Rocky Mountain Region of the United States, where the majority of the proved reserves, production and long-term growth prospects are located. Delta and seven of its subsidiaries sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 11-14006 to 11-14013, inclusive) on Dec. 16, 2011, roughly six weeks before the Jan. 31, 2012 scheduled maturity of its $38.5 million secured credit facility with Macquarie Bank Limited and after several months of unsuccessful attempts to sell the business. Delta disclosed $375,498,248 in assets and $310,679,157 in liabilities, which also include $152,187,500 in outstanding obligations on account of the 7% senior unsecured notes issued in March 2005 with US Bank National Association indenture trustee; and $115,527,083 in outstanding obligations on account of 3-3/4% Senior Convertible Notes due 2037 issued in April 2007. In its amended schedules, the Delta Petroleum disclosed $373,836,358 in assets and $312,864,788 in liabilities. W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A. Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard & Reed LLP, in New York, N.Y., represent the Debtors as counsel. Derek C. Abbott, Esq., Ann C. Cordo, Esq., and Chad A. Fights, Esq., at Morris, Nichols, Arsht & Tunnel LLP, in Wilmington, Del., represent the Debtors as co-counsel. Conway Mackenzie is the Debtors' restructuring advisor. Evercore Group L.L.C. is the financial advisor and investment banker. The Debtors selected Epiq Bankruptcy Solutions, LLC as claims and noticing agent. The petition was signed by Carl E. Lakey, chief executive officer and president. Laramie Energy II LLC has been approved by the Court to serve as the sponsor for Delta's reorganization plan. Roberta A. Deangelis, U.S. Trustee for Region 3, appointed three creditors to serve on the Official Committee of Unsecured Creditors in the Chapter 11 cases of Delta Petroleum. DELTATHREE INC: Inks Banking Services Pact with Int'l Bancard -------------------------------------------------------------- deltathree, Inc., Global Payments Direct, Inc., and International Bancard Corporation executed the Card Services Agreement pursuant to which International Bancard will provide merchant banking services to the Company. In connection with, and as a condition to, International Bancard's entering into the Agreement, Manna Holdings, LLC, executed a Cross Corporate Guarantee in favor of International Bancard pursuant to which Manna guaranteed all payments to be made by the Company to International Bancard under the Agreement. Manna Holdings is the sole member of D4 Holdings, LLC. The Company is majority-owned by D4 Holdings. The ultimate ownership of D4 Holdings includes owners of ACN, Inc. Each of Robert Stevanovski, Anthony Cassara and David Stevanovski, members of the Company's Board of Directors, is a principal of D4 Holdings and has an ownership interest in, and a director, officer or advisory position with, ACN. As a result, each of these individuals and D4 Holdings may be deemed to have a direct or indirect interest in the transactions contemplated by the Guarantee. About deltathree Based in New York, deltathree, Inc. (OTC QB: DDDC) -- http://www.deltathree.com/-- is a global provider of video and voice over Internet Protocol (VoIP) telephony services, products, hosted solutions and infrastructures for service providers, resellers and direct consumers. After auditing the 2011 results, Brightman Almagor Zohar & Co., noted that Company's recurring losses from operations and deficiency in stockholders' equity raise substantial doubt about its ability to continue as a going concern. The Company reported a net loss of $3.05 million in 2011, a net loss of $2.49 million in 2010, and a net loss of $3.19 million in 2009. The Company's balance sheet at March 31, 2012, showed $1.86 million in total assets, $6.80 million in total liabilities, and a $4.93 million in total stockholders' deficiency. Bankruptcy Warning The Company disclosed in its annual report for the period ended Dec. 31, 2011, that in view of its current cash resources, nondiscretionary expenses, debt and near term debt service obligations, the Company may begin to explore all strategic alternatives available to it, including, but not limited to, a sale or merger of the Company, a sale of its assets, recapitalization, partnership, debt or equity financing, voluntary deregistration of its securities, financial reorganization, liquidation or ceasing operations. In the event that it is unable to secure additional funding, the Company may determine that it is in its best interests to voluntarily seek relief under Chapter 11 of the U.S. Bankruptcy Code. Seeking relief under the U.S. Bankruptcy Code, even if the Company is able to emerge quickly from Chapter 11 protection, could have a material adverse effect on the relationships between the Company and its existing and potential customers, employees, and others. Further, if the Company was unable to implement a successful plan of reorganization, the Company might be forced to liquidate under Chapter 7 of the U.S. Bankruptcy Code. DEWEY & LEBOEUF: Wants to Pay Up to $700K in Bonuses to Employees ----------------------------------------------------------------- Dewey & LeBoeuf LLP is seeking bankruptcy court approval to pay up to $700,000 in bonuses to its remaining 52 employees. Bankruptcy Law360 relates that Dewey, which filed for Chapter 11 bankruptcy in May following the defection of more than half of its partners, said it would struggle without the bonuses to keep its dwindling workforce intact. According to Bankruptcy Beat, the Debtor said that it already whittled its staff down to a "minimum core" team before seeking bankruptcy protection, and additional employees have resigned or been terminated. The Debtor said that it cannot lose more of its employees, Bankruptcy Beat relates. "Without the continued commitment of these employees, the Debtor's ability to complete an orderly liquidation and to make a meaningful distribution to creditors would be severely compromised," the Debtor said in court papers. Court papers show that the Debtor is proposing to pay a maximum of $450,000 in retention payments to all of its rank-and-file workers. Bankruptcy Beat reports that five employees, including the Debtor's director of billing and collections manager, could get additional money under a proposed incentive plan tied to the Debtor's ability to collect on client bills. The Debtor, says Bankruptcy Beat, was owed about $217 million in outstanding legal fees at the time of its bankruptcy filing. Bankruptcy Beat states that the incentives will come from the fees the Debtor's collection agent earns and fluctuate depending on the amount of legal bills collected. Bankruptcy Beat relates that the payment plan envisions staff remaining through at least Aug. 31 and at best through Nov. 30. The Debtor's four remaining senior managers -- like executive partner Stephen J. Horvath and general counsel Janis M. Meyer -- aren't eligible for the incentives or retention payments, Bankruptcy Beat states. The court will hold a hearing on July 25 to consider the Debtor's request, Bankruptcy Beat reports. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, of the 52 still employed by the firm other than senior management, 44 operational staff will be offered bonuses of two weeks' to eight weeks' pay depending on how long they remain on the job. The last worker would leave Nov. 30. Seven workers involved in accounts receivable collection also would be given two to eight weeks' pay, with the last worker leaving Nov. 30. In addition, Dewey, according to the Bloomberg report, is proposing that five other key employees collecting accounts receivable be permitted to share as much as $250,000 in compensation received by On-Site Associates LLC, a company being hired to help with collections. If $50 million in receivables are collected, the five would share a bonus of $82,500, increasing another $82,500 if collections total $75 million. If collections reach $125 million, a final bonus of $82,000 will be paid. 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. DEWEY & LEBOEUF: Wants to Hire Firm to Liquidate Frankfurt Office ----------------------------------------------------------------- Linda Sandler at Bloomberg News reports that Dewey & LeBoeuf LLP said it wanted to hire another firm to liquidate its Frankfurt office. German legal news website JuVe relates that all equity partners at the Debtor's Frankfurt office have now found new homes. Joshua Freedman at The Lawyer says that Ashurst has picked up two Frankfurt partners from the Debtor, corporate lawyer Benedikt von Schorlemer and employment specialist Andreas Mauroschat. Mr. von Schorlemer will join Ashurst as a partner, while the City firm is also taking on the Debtor's corporate senior associate Jan Krekeler, The Lawyer states. Mr. Mauroschat, according to The Lawyer, will head Ashurst's German employment practice as its only employment partner in the jurisdiction. Litigator Tanja Pfitzner is setting up her own practice, JuVe reports. 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. DEX MEDIA EAST: Bank Debt Trades at 48% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which Dex Media East LLC is a borrower traded in the secondary market at 51.50 cents-on- the-dollar during the week ended Friday, July 6, 2012, a drop of 0.95 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 250 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 24, 2014. The loan is one of the biggest gainers and losers among 153 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About R.H. Donnelley & Dex Media East Dex One, headquartered in Cary, North Carolina, is a local business marketing services company that includes print directories and online voice and mobile search. R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media East LLC, Dex Media West LLC and Dex Media Inc., filed for Chapter 11 protection (Bank. D. Del. Case No. 09-11833 through 09- 11852) on May 28, 2009. They emerged from bankruptcy on Jan. 29, 2010. On the Effective Date and in connection with its emergence from Chapter 11, RHD was renamed Dex One Corporation. Dex One reported a net loss of $518.96 million in 2011 compared with a net loss of $923.59 million for the eleven months ended Dec. 31, 2010. * * * As reported in the April 2, 2012 edition of the TCR, Moody's Investors Service has downgraded the corporate family rating (CFR) for Dex One Corporation's to Caa3 from B3 based on Moody's view that a debt restructuring is inevitable. Moody's has also changed Dex's Probability of Default Rating (PDR) to Ca/LD from B3 following the company's purchase of about $142 million of par value bank debt for about $70 million in cash. The Caa3 rating also reflects Moody's view that additional exchanges at a discount are likely in the future since the company amended its bank covenants to make it possible to repurchase additional bank debt on the open market through the end of 2013. As reported by the TCR on April 4, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Cary, N.C.-based Dex One Corp. and related entities to 'CCC' from 'SD' (selective default). "The upgrade reflects our assessment of the company's credit profile after the completion of the subpar repurchase transaction in light of upcoming maturities, future subpar repurchases, and our expectation of a continued week operating outlook," explained Standard & Poor's credit analyst Chris Valentine. DIGITAL REALTY: Fitch Rates $453MM Redeemable Stock at 'BB+' ------------------------------------------------------------ Digital Realty Trust, Inc.'s (NYSE: DLR) expansion in the greater London area will not affect the company's current ratings or Outlook. Certain of the company's credit metrics will weaken slightly but will remain appropriate for the 'BBB' Issuer Default Rating (IDR) in connection with the announcement by DLR and its operating partnership, Digital Realty Trust, L.P. (collectively, Digital Realty) that the company is acquiring a three-property data center portfolio known as the Sentrum Portfolio. This transaction will add quality real estate to the company's unencumbered pool, bolster the company's European footprint, and further reduce overall tenant concentration. Fitch currently rates Digital Realty as follows: Digital Realty Trust, Inc. -- IDR 'BBB'; -- $453.0 million redeemable preferred stock 'BB+'; -- $292.5 million convertible preferred stock 'BB+'. Digital Realty Trust, L.P. -- IDR 'BBB'; -- $1.5 billion unsecured revolving credit facility 'BBB'; -- $750 million senior unsecured multi-currency term loan facility 'BBB'; -- $1.4 billion senior unsecured notes 'BBB'; -- $266.4 million senior unsecured exchangeable notes 'BBB'. The Rating Outlook is Stable. The purchase price for the Sentrum portfolio, which totals approximately 761,000 square feet in Woking, Watford and Croydon, will be approximately 715.9 million pounds Sterling or $1.1 billion. Meaningfully, pro forma annualized rent is generated across 31 markets in nine countries and will increase Digital Realty's exposure to London, a high growth market. In addition, as of March 31, 2012 pro forma, top tenants were CenturyLink, Inc. (Fitch IDR 'BBB-' with a Stable Outlook) at 9.5% annualized rent, Equinix Operating Company, Inc. at 3.7%, TelX Group, Inc. at 3.6%, Facebook, Inc. at 3.4%, and AT&T (Fitch IDR 'A' with a Stable Outlook) at 2.9%. Digital Realty's exposure to each of its top four tenants declines from 40 to 90 basis points of annualized rent when compared with March 31, 2012 levels. The 'BBB' IDR continues to reflect the solid performance of the company's large data center portfolio. The portfolio benefits from favorable demand, high barriers to entry, as well as long-term leases, and contributes towards improving fixed charge coverage. Digital Realty also has a strong balance sheet, a deep bench in terms of real estate and technical expertise professionals, and a good liquidity profile. The ratings also take into account that the company is a niche real estate investment trust (REIT) that is by definition exposed to the technology industry. Technology industry obsolescence and cycles can cause industry volatility, creating vacancy but also enable new entrants to fill vacant space. In addition, the company has good unencumbered asset coverage of unsecured debt, but its access to secured debt for contingent liquidity and financial flexibility may be more constrained than for REITs in other commercial property sectors. Positive demand drivers for datacenters include growth in data storage and use by corporate enterprises, telecommunication companies, providers of colocation (multi-tenant datacenter product offered on the basis of individual racks or cages), and other customers such as social networking sites. Cloud computing (shared resources provided to Internet computing devices on demand) and other changes in information technology are also boosting datacenter demand, while expensive building costs limit new supply. In this context, leasing trends remain positive for Digital Realty's Turn-Key Flex (TKF) properties that offer metered power to various customers, as well as Powered Base Building (PBB) space that enables tenants to build out their own datacenter facilities. TKF and PBB lease renewal rates on commenced leases increased in the first quarter of 2012 (1Q'12) by 1.2% and 20.5%, respectively, resulting in same store net operating income (NOI) growth of 9.1% in 1Q'12. Same-store NOI increases ranged from 6.4% to 11.1% each quarter in 2011. Tier1 Research, LLC projects that datacenter revenue growth will continue on its current trajectory during 2012-2013, which should provide opportunities for Digital Realty to continue to increase rents and leasing up space under construction. Digital Realty's remaining lease term was seven years and weighted average original lease term was approximately 14 years as of March 31, 2012, providing cash flow predictability absent tenant bankruptcies. The company also has a staggered lease expiration schedule. As of March 31, 2012, 4.7%, 7.3%, and 12.3% of annualized rent was scheduled to expire for the remainder of 2012, 2013, and 2014, respectively. The company's fixed charge coverage ratio (recurring operating EBITDA less recurring capital expenditures less straight-line rent adjustments divided by total interest incurred and preferred dividends) was 2.9 times (x) for the trailing twelve months ended March 31, 2012 pro forma for the Sentrum acquisition, compared with 2.8x for the trailing twelve months ended March 31, 2012 and 2.8x in 2011. The company expects to fund the Sentrum portfolio purchase with borrowings under its global revolving credit facility, a bridge loan facility, the proceeds from debt and equity financings (including approximately $796.8 million offering priced on June 26, 2012) and/or available cash. The pro forma coverage ratio assumes the company will access the unsecured debt market to repay the bridge loan facility and a portion of the global revolving credit facility. Fitch projects continued mid-to-high single same-store NOI growth, along with acquisitions in the 7% to 8% capitalization rate range and a gradual lease-up of construction in progress, to result in fixed charge coverage sustaining around 3.0x over the next 12 to 24 months. In a stress case where the majority of the company's current development pipeline remains unleased, fixed charge coverage would decline from current levels but remain above 2.5x, which would be adequate for the current rating. In a more adverse case not anticipated by Fitch whereby tenant bankruptcies result in a 10% decline in NOI, fixed charge coverage would fall just below 2.5x, which would be weak for the current rating. Leverage is rising as a result of the Sentrum acquisition, with net debt to recurring operating EBITDA of 5.4x as of March 31, 2012 pro forma, compared with 5.1x and 4.7x as of March 31, 2012 and Dec. 31, 2011, respectively. Fitch anticipates that leverage will sustain in the mid 4x to mid 5x range as the company continues to utilize a combination of debt and equity issuance to fund acquisitions and development. In a stress case where the majority of the company's current development pipeline remains unleased, leverage would approach 5.5x in the near term. In a more adverse case not anticipated by Fitch whereby tenant bankruptcies result in a 10% decline NOI, leverage would rise slightly above 5.0x. Both of these downside leverage levels would remain appropriate for the rating. Digital Realty's management team has a good track record of acquiring and developing assets with attractive returns, as well as a technical staff focused on operating efficiencies. Fitch anticipates that the company will utilize its productive leasing platform to fill vacant space in the portfolio currently under development, offsetting the relatively low 80% leased rate for the Sentrum portfolio. The company has a strong liquidity position. Its base case liquidity coverage ratio assuming no additional capital raises is 2.0x for April 1, 2012 to Dec. 31, 2013 pro forma for the Sentrum transaction. Fitch calculates base case liquidity coverage as liquidity sources (unrestricted cash, availability under the company's $1.5 billion global unsecured credit facility pro forma for the Sentrum acquisition, and projected operating cash flow after dividends and distributions), divided by liquidity uses (debt maturities and projected recurring capital expenditures). Net proceeds from the company's $796.8 million equity offering priced on June 26, 2012 are not expected to benefit corporate liquidity but will instead be used to source the Sentrum acquisition. While the company's metrics are strong for a 'BBB' IDR, the rating takes into account the company's exposure to the technology market. Digital Realty went public in 2004 several years after the dot-com bubble burst and has experienced a favorable technology environment through economic cycles. Moreover, uncertainties exist, such as the risk that Digital Realty's more successful tenants choose to develop their own datacenters, as opposed to leasing space from the company. As evidenced by the Sentrum portfolio, the company continues to expand in Europe and across the Asia-Pacific region, including Singapore and Australia, to take advantage of datacenter needs. This expansion should provide the potential for above-average investment returns. As of June 29, 2012, Digital Realty's portfolio consisted of 105 properties, excluding three unconsolidated joint venture properties and includes a large unencumbered pool. UA/UD, or the ratio of unencumbered assets (1Q'12 unencumbered NOI divided by a stressed capitalization rate of 10%) to unsecured debt, was 1.8x as of March 31, 2012 pro forma for the Sentrum acquisition, compared with 2.0x as of March 31, 2012. The company's access to secured debt for contingent liquidity may be more constrained than for REITs in more conventional commercial property sectors given the less-proven nature of the asset class through cycles and commercial real estate mortgage lender appetite for the asset class. That being said, the covenants in the company's credit agreements do not restrict Digital Realty's financial flexibility. The Stable Outlook reflects Fitch's projection that fixed charge coverage will sustain around 3x, that leverage will remain approximately in the mid-4x to mid-5x range, and that the company will continue its gradual tenant and asset diversification via acquisitions and development. The two-notch differential between Digital Realty's IDR and preferred stock rating is consistent with Fitch's criteria for a U.S. REIT with an IDR of 'BBB'. These shares are deeply subordinated and have loss absorption elements that would likely result in poor recoveries in the event of a corporate default. The following factors may have a positive impact on Digital Realty's ratings and/or Outlook: -- Fixed charge coverage sustaining above 3.0x (pro forma fixed charge coverage ratio is 2.9x); -- Net debt to recurring operating EBITDA sustaining below 4.5x (pro forma leverage is 5.4x); -- Increased mortgage lending activity in the datacenter sector; -- Broader tenant and asset diversification. The following factors may have a negative impact on Digital Realty's ratings and/or Outlook: -- Fixed charge coverage sustaining below 2.5x; -- Leverage sustaining above 6.0x; -- Base case liquidity coverage sustaining below 1.0x. DRINKS AMERICAS: Hubert Millet Resigns from Board of Directors -------------------------------------------------------------- Hubert Millet resigned as a director of Drinks Americas Holdings, Ltd., on June 28, 2012. Mr. Millet's resignation was not due to any disagreement with the Company on any matter relating to the Company's operations, policies or practices. About Drinks Americas Headquartered in Wilton, Conn., Drinks Americas Holdings, Ltd. -- http://www.drinksamericas.com/-- through its majority-owned subsidiaries, Drinks Americas, Inc., Drinks Global, LLC, D.T. Drinks, LLC, and Olifant U.S.A Inc., imports, distributes and markets unique premium wine and spirits and alcoholic beverages associated with icon entertainers, celebrities and destinations, to beverage wholesalers throughout the United States. The Company reported a net loss of $4.58 million on $497,453 of net sales for the year ended April 30, 2011, compared with a net loss of $5.61 million on $890,380 of net sales during the prior year. After auditing the fiscal 2011 financial statements, Bernstein & Pinchuk, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses from operations since its inception and has a working capital deficiency. The Company's balance sheet at Jan. 31, 2012, showed $6.74 million in total assets, $4.39 million in total liabilities, and $2.35 million in total stockholders' equity. DYNEGY HOLDINGS: To Present Plan for Confirmation Sept. 5 --------------------------------------------------------- Dynegy Holdings LLC is now a step closer to emerging from bankruptcy protection after getting court approval of an outline of their Chapter 11 plan after Judge Cecelia Morris of the U.S. Bankruptcy Court for the Southern District of New York approved on July 3 the outline or the so-called disclosure statement, which describes the company's proposed restructuring plan. In a 19-page decision dated July 3, Judge Morris held that the disclosure statement contains "adequate information" that would allow Dynegy creditors to make an informed decision on whether to support the plan. Judge Morris also overruled objections to the outline and gave Dynegy Holdings the go-signal to begin soliciting votes from creditors. A full-text copy of the July 3 order is available without charge at http://bankrupt.com/misc/Dynegy_OrdDS070312.pdf The deadline for voting on and for objecting to the plan is August 24. A court hearing to consider confirmation of the plan is scheduled for September 5. Dynegy Chief Executive Officer Robert Flexon said the approval is a "significant step forward for the company and firmly places us on track for a fall emergence." "We are looking forward to completing the restructuring work and dedicating our focus exclusively to running the business, executing on our strategy and building value for all our stakeholders," Mr. Flexon said in a June 5 statement. Judge Morris handed down the decision a day after she instructed lawyers involved in Dynegy Holdings' bankruptcy case to change the wording of an order approving the outline to give creditors more information about the proposed restructuring, according to a July 2 report from Bloomberg News. Earlier, the U.S Trustee, a Justice Department agency that oversees bankruptcy cases, complained the disclosure statement does not provide enough information about the anticipated bankruptcy filing of Dynegy Inc., among other issues. Lawyers representing The Town of Newburgh and Orange County also filed an objection, arguing the outline does not say if Dynegy Holdings will continue to cover the operational losses incurred by its Roseton and Danskammer plants prior to their sale. They eventually dropped their objection after Dynegy Holdings made revisions to the outline to address each of the issues raised by the municipality and the U.S. Trustee. Dynegy Holdings' proposed plan calls for the merging between the company and Dynegy Inc., with the parent being the surviving entity. Under the plan, $200 million cash and 99% of the merged companies' stock will be given to holders of $4.2 million of general unsecured claims against Dynegy Holdings. The claims include about $3.5 billion on six issues of notes, $110 million for a tax- indemnity claim, $540 million on lease guaranty claims, and $55 million to holders of $222 million in subordinated debt. The plan also provides for the distribution of 1% of the merged companies' stock to holders of administrative claims. General unsecured creditors with claims of about $4.2 billion, including noteholders, will receive a recovery of between 59% and 89%. The restructuring plan is the result of a settlement reached with creditors holding more than $2.7 billion of claims against Dynegy Holdings. Dynegy Inc. plans to file for Chapter 11 protection to carry out that settlement and complete the merger. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7 to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. Dynegy was advised by Lazard Freres & Co. LLC and the Debtor Entities' financial advisor is FTI Consulting. The Official Committee of Unsecured Creditors has tapped Akin Gump Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16, 2011. DYNEGY HOLDINGS: Town of Newburgh Seeks Tax Payments ---------------------------------------------------- A lawyer representing The Town of Newburgh in Dynegy Holdings LLC's bankruptcy case is demanding the company to pay the property taxes it owes, saying it is a "valid administrative claim." "Payment of taxes is a valid part of the cost of doing business and consequently a valid administrative expense," said Lewis Wrobel, Esq. He pointed out that the property taxes became a liability of the Dynegy estate on January 1, 2012. Mr. Wrobel further said the overdue tax bill may affect local services such as fire protection, which the municipality provides to the company. Dynegy Holdings' subsidiaries operate two power generation plants in Newburgh. It owes about $7.6 million in property taxes to Newburgh and Orange County, of which about $5 million is due to the municipality. The company also owes Newburgh an additional $385,000 in fines. Earlier, a lawyer for the Dynegy units asked Judge Cecelia Morris to deny Newburgh's and Orange County's motions seeking payment of property taxes, arguing it would affect operations in the Newburgh plants as well as future sale of those plants. Dynegy Holdings' parent and creditors holding more than $2.7 billion of claims against the company recently reached a settlement, which contemplates a sale of the plants. Brian Lohan, Esq., at Sidley Austin LLP, in New York, said the Dynegy units would not be able to fund their operations through the sale process if they were compelled to pay the tax claims immediately. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7 to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. Dynegy was advised by Lazard Freres & Co. LLC and the Debtor Entities' financial advisor is FTI Consulting. The Official Committee of Unsecured Creditors has tapped Akin Gump Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16, 2011. DYNEGY INC: Follows Units in Chapter 11 to Set Stage for Merger --------------------------------------------------------------- Dynegy Inc. on July 6 filed a voluntary petition to reorganize under Chapter 11 (Bankr. S.D.N.Y. Case No. 12-36728) in Poughkeepsie, New York. It also sought joint administration of its case with those of Dynegy Holdings, LLC and other affiliates. Dynegy Holdings has filed a Chapter 11 restructuring plan based on a settlement reached with creditors holding more than $2.7 billion of claims against Holdings. The plan support agreement signed by the parties contemplates the merger of Holdings with Dynegy Inc., with Dynegy Inc. as the surviving entity. Dynegy Inc. has determined that the most prudent method by which to effectuate the merger contemplated in the Plan is to file for Chapter 11 relief. Dynegy Inc. is represented by White & Case LLP and advised by Lazard Freres & Co. LLC. First Day Motions Dynegy Inc. has sought customary first-day relief designed to ensure a smooth transition into Chapter 11 administration. Among other things, this relief, if granted by the Bankruptcy Court, will ensure that the Company has sufficient cash and liquidity to fund its continuing operations and all administrative obligations incurred during the Chapter 11 process. Aside from its request for joint administration, Dynegy Inc. has filed a motion directing that certain orders entered in the Holdings cases, including the order approving the disclosure statement explaining the Plan, be made applicable to the Dynegy Inc. case. In addition, Dynegy Inc. has sought a motion establishing Aug. 1, 2012 as the deadline for creditors to file proofs of claims and Jan. 2, 2013 for governmental units to file their claims. Dynegy Inc. said it seeks to confirm the Plan and emerge from chapter 11 in as short a time as possible. The Chapter 11 Plan Dynegy Inc. said its bankruptcy filing is crucial to the implementation of Holding's pending Chapter 11 plan and the resolution of months of extremely contentious litigation between the Company and its stakeholders. Under the plan, $200 million cash and 99% of the merged companies' stock will be given to holders of $4.2 million of general unsecured claims against Holdings. The claims include about $3.5 billion on six issues of notes, $110 million for a tax-indemnity claim, $540 million on lease guaranty claims, and $55 million to holders of $222 million in subordinated debt. The plan also provides for the distribution of 1% of the merged companies' stock to holders of administrative claims. General unsecured creditors with claims of about $4.2 billion, including noteholders, will receive a recovery of between 59% and 89%. Judge Cecelia Morris will convene a hearing to consider confirmation of the Plan on Sept. 5, 2012. Settlement Dynegy Inc., Holdings, and certain DH Debtors and the primary creditor constituencies have obtained approval of an Amended and Restated Settlement Agreement in Holdings' Chapter 11 case. Among other things, the settlement, which has already been approved by the bankruptcy court, provides for Dynegy Inc. and Holdings to merge and for the administrative claim granted to Dynegy Inc. in the Dynegy Holdings Chapter 11 case to be transferred out of Dynegy Inc. for the benefit of its shareholders. Both of these matters are the subject of a pending motion in Holdings' case. Subject to obtaining additional relief from the court in Dynegy Inc.'s case, the filing will also permit the solicitation of votes on the Companies' joint Chapter 11 plan to commence. It is contemplated that upon completion of the merger, Dynegy Inc. will be the surviving entity. All assets will then be held under a single holding company, thus eliminating a layer from the corporate structure. Coal-Fired and Gas-Fired Businesses According to a statement, Dynegy Inc. subsidiaries that own and operate the Company's coal-fired and gas-fired businesses were separately financed during 2011 and are therefore not included in the July 6 Chapter 11 filing. They will continue to operate their businesses in the ordinary course. About Dynegy Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7, 2011, to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. The Debtor Entities' financial advisor is FTI Consulting. The Official Committee of Unsecured Creditors has tapped Akin Gump Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16, 2011. DYNEGY INC: U.S. Trustee Opposes Merger --------------------------------------- The U.S. Trustee, a Justice Department agency that oversees bankruptcy cases, is blocking efforts by Dynegy Holdings LLC to get court approval of the proposed merger between the company and its parent. The proposed merger is part of Dynegy Holdings' proposed Chapter 11 plan of reorganization filed last month, which calls for the merging of the company and Dynegy Inc., with the parent being the surviving entity. The U.S. Trustee said the company did not provide sufficient information about the merger, which makes it hard to assess its effects. "Absent these details, it is impossible to fully understand the impact of joining the two entities," the agency said in a court filing. The U.S. Trustee further said the proposed merger should not be approved without Dynegy Holdings "meeting its burden to demonstrate the legal and factual basis" for the merger. The agency argued the approval would result in Dynegy Inc. being authorized to file a bankruptcy case with an approved disclosure statement, and to solicit votes prior to filing documents required by U.S. bankruptcy law. A court hearing to consider the U.S. Trustee's objection is scheduled for July 9. About Dynegy Inc. Through its subsidiaries, Houston, Texas-based Dynegy Inc. (NYSE: DYN) -- http://www.dynegy.com/-- produces and sells electric energy, capacity and ancillary services in key U.S. markets. The power generation portfolio consists of approximately 12,200 megawatts of baseload, intermediate and peaking power plants fueled by a mix of natural gas, coal and fuel oil. In August, Dynegy implemented an internal restructuring that created two units, one owning eight primarily natural gas-fired power generation facilities and another owning six coal-fired plants. Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and said it was discussing options for managing its debt load with certain bondholders. Dynegy Holdings LLC and four other affiliates of Dynegy Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-38111) Nov. 7 to implement an agreement with a group of investors holding more than $1.4 billion of senior notes issued by Dynegy's direct wholly-owned subsidiary, Dynegy Holdings, regarding a framework for the consensual restructuring of more than $4.0 billion of obligations owed by DH. If this restructuring support agreement is successfully implemented, it will significantly reduce the amount of debt on the Company's consolidated balance sheet. Dynegy Holdings disclosed assets of $13.77 billion and debt of $6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each estimated $100 million to $500 million in assets and debt. Dynegy Holdings and its affiliated debtor-entities are represented in the Chapter 11 proceedings by Sidley Austin LLP as their reorganization counsel. Dynegy and its other subsidiaries are represented by White & Case LLP, who is also special counsel to the Debtor Entities with respect to the Roseton and Danskammer lease rejection issues. Dynegy was advised by Lazard Freres & Co. LLC and the Debtor Entities' financial advisor is FTI Consulting. The Official Committee of Unsecured Creditors has tapped Akin Gump Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16, 2011. EK HOSPITALITY: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: EK Hospitality, L.P. dba Quality Inn fka La Quinta 1001 W. Airport Freeway Euless, TX 76040 Bankruptcy Case No.: 12-43842 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Northern District of Texas (Ft. Worth) Judge: Russell F. Nelms Debtor's Counsel: Rakhee V. Patel, Esq. PRONSKE & PATEL, P.C. 2200 Ross Avenue, Suite 5350 Dallas, TX 75201 Tel: (214) 658-6500 Fax: (214) 658-6509 E-mail: rpatel@pronskepatel.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Manpreet Singh, manager of MMB Hospitality, LLC. EMPIRE RANCH: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Empire Ranch Golf Course, LLC 1885 E. Long Street Carson City, NV 89706 Bankruptcy Case No.: 12-51565 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court District of Nevada (Reno) Judge: Bruce T. Beesley Debtor's Counsel: Kevin A. Darby, Esq. DARBY LAW PRACTICE, LTD. 4777 Caughlin Pkwy Reno, NV 89519 Tel: (775) 322-1237 Fax: (775) 996-7290 E-mail: kevin@darbylawpractice.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/nvb12-51565.pdf The petition was signed by Dwight Millard, manager member. Affiliates that previously filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- Dwight Millard 11-50677 03/06/11 Millard Family Business, LLC 12-50890 04/18/12 Sandra Millard 11-52679 08/22/11 Stanton Park Development, Inc. 11-50438 02/14/11 EMPIRE RESORTS: Exercise Period Under Option Pact on Dec. 21 ------------------------------------------------------------ Monticello Raceway Management, Inc., a wholly-owned subsidiary of Empire Resorts, Inc., entered into an option agreement with EPT Concord II, LLC, which Option Agreement was amended by letter agreements, dated March 30, 2012, April 30, 2012, and May 30, 2012. Pursuant to the Option Agreement, EPT granted MRMI a sole and exclusive option, to lease certain EPT property located in Sullivan County, New York, pursuant to the terms of a lease negotiated between the parties. MRMI and EPT entered into a fourth letter agreement, dated as of June 29, 2012, and effective as of June 30, 2012, amending certain terms of the Option Agreement. More specifically, MRMI and EPT agreed to extend the option exercise period from Sept. 21, 2012, to Dec. 21, 2012. In addition, the parties agreed to extend the date by which they would enter into a master development agreement with respect to the EPT Property from June 30, 2012, to Oct. 1, 2012. Except for these amendments, the Option Agreement remains unchanged and in full force and effect. Degliomini Employment Agreement The Company entered into an employment agreement, dated as of June 29, 2012, with Charles Degliomini, to continue to serve as the Company's Executive Vice President or such other titles as may be granted by the Company. Mr. Degliomini's employment agreement provides for a term ending on June 28, 2013, unless Mr. Degliomini's employment is terminated by either party in accordance with the provisions thereof. Mr. Degliomini is to receive a base salary of $250,000 and such incentive compensation and bonuses, if any, (i) as the Compensation Committee in its discretion may determine, and (ii) to which Mr. Degliomini may become entitled pursuant to the terms of any incentive compensation or bonus program, plan or agreement from time to time in effect in which he is a participant. In the event that the Company terminates Mr. Degliomini's employment with Cause or Mr. Degliomini resigns without Good Reason, the Company's obligations are limited generally to paying Mr. Degliomini his base salary, unpaid expenses and any benefits to which Mr. Degliomini in entitled through the termination date. In the event Mr. Degliomini's employment is terminated as a result of death or disability, Mr. Degliomini's or his estate, as the case may be, is entitled to receive the Accrued Obligations and any unvested options held by Mr. Degliomini will become vested immediately and remain exercisable through the remainder of its original 5 year term. The Company has agreed to customary indemnification for Mr. Degliomini for any claims arising out of his service to the Company. In addition, Mr. Degliomini agreed to customary non- competition and non-solicitation provisions that extend for a post-termination period ranging from three months to one year following the date of termination depending on the reason for termination. Mr. Degliomini has also agreed to customary terms concerning the protection and confidentiality of company information. About Empire Resorts Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY) -- http://www.empireresorts.com/-- owns and operates Monticello Casino & Raceway, a video gaming machine and harness racing track and casino located in Monticello, New York, 90 miles northwest of New York City. The Company reported a net loss of $24,000 in 2011, compared with a net loss of $17.57 million in 2010. The Company's balance sheet at March 31, 2012, showed $50.38 million in total assets, $25.05 million in total liabilities and $25.33 million in total stockholders' equity. EP LINCOLN: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: EP Lincoln Investments, LLC 4012 Montana, Ave. El Paso, TX 79903 Bankruptcy Case No.: 12-31265 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Western District of Texas (El Paso) Judge: H. Christopher Mott Debtor's Counsel: Carlos A. Miranda, III, Esq. CARLOS A. MIRANDA, III & ASSOCIATES P.C. 5915 Silver Springs, Bldg 7 El Paso, TX 79912 Tel: (915) 587-5000 Fax: (915) 587-5001 E-mail: cmiranda@mirandafirm.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 Oscar Andrade, president/managing member. EP PROVIDENCE: Case Summary & 10 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: EP Providence Plaza, LLC 13141 Soleen Road El Paso, TX 79938 Bankruptcy Case No.: 12-31262 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Western District of Texas (El Paso) Judge: H. Christopher Mott Debtor's Counsel: Karla Patricia Martinez, Esq. DIAMOND LAW 3800 N. Mesa St. B-3 El Paso, TX 79902 Tel: (915) 532-3327 Fax: (915) 532-3355 E-mail: usbc@sidneydiamond.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 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txwb12-31262.pdf The petition was signed by Antonio Diaz, president. GAMETECH INTERNATIONAL: Case Summary & Creditors List ----------------------------------------------------- Debtor: GameTech International, Inc. 8850 Double Diamond Parkway Reno, NV 89521 Bankruptcy Case No.: 12-11964 Affiliates that simultaneously filed Chapter 11 petitions: Debtor Case No. ------ -------- GameTech Arizona Corporation 12-11965 GameTech Canada Corporation 12-11966 GameTech Mexico S. De R.L. De C.V. 12-11967 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Judge: Peter J. Walsh About GameTech: GameTech develops and manufactures gaming entertainment products and systems. GameTech holds a significant position in the North American bingo market with its interactive electronic bingo systems, portable and fixed-based gaming units, and complete hall management modules. It also holds a significant position in select North American VLT markets, primarily Montana, Louisiana, and South Dakota, where it offers video lottery terminals and related gaming equipment and software. It also offers Class III slot machines and server-based gaming systems. Debtors' Counsel: Dennis A. Meloro, Esq. GREENBERG TRAURIG, LLP The Nemours Building 1007 North Orange Street, Suite 1200 Wilmington, DE 19801 Tel: (302) 661-7000 Fax: (302) 661-7360 E-mail: bankruptcydel@gtlaw.com - and ? Matthew L. Hinker, Esq. GREENBERG TRAURIG, LLP The Nemours Building 1007 North Orange Street, Suite 1200 Wilmington, DE 19801 Tel: (703) 661-7668 E-mail: hinkerm@gtlaw.com Debtors' Financial Advisor: KINETIC ADVISORS, LLC Total Assets: $27.22 million as of Jan. 29, 2012 Total Liabilities: $22.88 million as of Jan. 29, 2012 The petitions were signed by Andrew E. Robinson, senior vice president, chief financial officer, and treasurer. Debtors' Consolidated List of Their 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Piercy Bowler Taylor & Kern -- $153,822 6100 Elton Avenue, Suite 1000 Las Vegas, NV 89107 Elite Casino Products, Inc. -- $133,303 333 Munroe Drive Bloomingdale, IL 60108 Tek Visions Inc. -- $117,476 40970 Anza Road Temecula, CA 92592 Microtips Technology, LLC -- $62,014 OEM-Tech Co. -- $52,477 BCM Advanced Research -- $64,176 Cole Kepro International, LLC -- $44,898 Elite Manufacturing Technologies, -- $44,755 Inc. Hong Video Technology -- $40,680 Primesoft Solutions, Inc. -- $40,500 Kassbohrer All Terain Vehicles, -- $40,000 Inc. Summit Data Communications Inc. -- $39,250 Ernst & Young -- $49,971 Gaming Laboratories Int'l, Inc. -- $30,901 M&M Operators -- $18,904 Dell Marketing L.P. -- $19,372 B2 Ventures -- $22,459 Ralston Supply Center -- $23,264 Western Computer -- $22,545 Arrow Electronics, Inc. -- $17,375 GARLOCK SEALING: Asbestos Claimants Seek Sanctions Against Firm --------------------------------------------------------------- Howard Goodman at Bankruptcy Law360 reports that a group of asbestos claimants on Tuesday asked a North Carolina federal judge to sanction Garlock Sealing Technologies Inc. for allegedly ignoring a court discovery order and motions to compel discovery of documents in the company's long-running bankruptcy proceeding. According to Bankruptcy Law360, the claimants have been seeking the documents for a year and a half, ever since Garlock asserted that some claimants had concealed that they had been exposed to asbestos from products made by Pittsburgh Corning Corp. rather than Garlock. 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. GENWORTH FINANCIAL: Moody's Assigns '(P)Ba1' Sub. Debt Rating ------------------------------------------------------------- Moody's Investors Service has assigned a provisional (P)Baa3 rating to the senior unsecured debt of Genworth Financial, Inc.'s ("Genworth"; NYSE: GNW, senior debt at Baa3, review for downgrade) multiple security shelf. Other provisional ratings assigned are listed below. The shelf rating renews and replaces a similar universal shelf registration that expires in August of 2012. All of the ratings are on review for downgrade, in line with the review on Genworth's ratings. Rating Rationale Moody's said that Genworth's Baa3 senior unsecured debt rating and the A3 IFS rating (stable outlook) 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. According to Scott Robinson, Senior Vice President, "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". Moody's noted that the following could lead to a confirmation of the holding company's ratings: 1) De-linkage from the US Mortgage Insurance (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 following provisional ratings were assigned and placed on review for downgrade: Genworth Financial, Inc. -- provisional senior unsecured debt rating at (P)Baa3; provisional subordinated debt rating at (P)Ba1; provisional preferred stock rating at (P)Ba2. 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. The principal methodologies used in this rating 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. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to pay punctually senior policyholder claims and obligations. GREAT OAKS: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: Great Oaks Fuel Stop, Inc. dba Great Oaks Chevron 16310 RR 620 Round Rock, TX 78681 Bankruptcy Case No.: 12-11532 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: Ray Fisher, Esq. FISHER LAW OFFICES P.O. Box 684565 Austin, TX 78768-4565 Tel: (512) 478-9810 Fax: (866) 299-9174 E-mail: rayfisher@rayfisherlaw.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $500,001 to $1,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Tahseen Khan, president. Affiliates that simultaneously filed Chapter 11 petitions: Debtor Case No. ------ -------- Evergreen Enterprises, Inc. 12-11533 Airport Fuel Stop, Inc. 12-11534 GULF COLORADO: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Gulf, Colorado & San Saba Railway Corporation 510 North Bridge Street Brady, TX 76825 Bankruptcy Case No.: 12-11531 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott About the Debtor: Gulf Colorado owns a railroad in San Saba, Mills, McCulloch and Lampasas Counties. Debtor's Counsel: Frances A. Smith, Esq. SHACKELFORD MELTON & MCKINLEY 3333 Lee Parkway, Tenth Floor Dallas, TX 75219 Tel: (214) 780-1400 Fax: (214) 780-1401 E-mail: fsmith@shacklaw.net Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $1,000,001 to $10,000,000 The petition was signed by Richard C. McClure, president and CEO. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Richard C. McClure Non-Purchase Money $415,547 135 N. Avenue Barrington, IL 60010 Howell Crane & Non-Purchase Money $123,475 Rigging, Inc. 4600 N. Highway 6, Ste. 101 Houston, TX 77084 Bill Ables Construction Non-Purchase Money $96,000 P.O. Box 1223 Whitney, TX 76692 Lincoln Brokers Non-Purchase Money $92,690 St. Charles Group Non-Purchase Money $90,000 Henslee Schwartz Non-Purchase Money $89,734 Hulcher Non-Purchase Money $67,119 FRA Non-Purchase Money $60,000 Brian Fetting Non-Purchase Money $55,000 Progess Rail Non-Purchase Money $39,214 Crane Services Non-Purchase Money $38,680 Lone Star Locomotive Non-Purchase Money $26,422 Balfour Beatty Non-Purchase Money $18,500 Johnson Oil Company Non-Purchase Money $13,516 Smith Railway Services Non-Purchase Money $13,500 Wizard Railcar Repair Non-Purchase Money $13,282 Motive Power Non-Purchase Money $9,694 Ball Janik Non-Purchase Money $6,820 Quality Signal Non-Purchase Money $6,000 Alamo Non-Purchase Money $5,391 HAMILTON BROKERAGE: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Hamilton Brokerage, LLC 451 Lee's Ford Dock Road Nancy, KY 42544 Bankruptcy Case No.: 12-60819 Chapter 11 Petition Date: July 4, 2012 Court: United States Bankruptcy Court Eastern District of Kentucky (London) Debtor's Counsel: Laura Day DelCotto, Esq. DELCOTTO LAW GROUP PLLC 200 North Upper St. Lexington, KY 40507 Tel: (859) 231-5800 Fax: (859) 281-1179 E-mail: ldelcotto@dlgfirm.com Estimated Assets: $100,001 to $500,000 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 James D. Hamilton, trustee of Hamilton Revocable Trust, sole member. Affiliates that simultaneously filed Chapter 11 petitions: Debtor Case No. ------ -------- Hamilton Capital, LLC 12-60820 Lees Ford Hotels, LLC 12-60821 Lees Ford Woods, LLC 12-60822 Top Shelf Marine Sales, Inc. 12-60823 HAWKER BEECHCRAFT: Bank Debt Trades at 42% Off in Secondary Market ------------------------------------------------------------------ Participations in a syndicated loan under which Hawker Beechcraft is a borrower traded in the secondary market at 57.55 cents-on- the-dollar during the week ended Friday, July 6, 2012, an increase of 0.65 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 200 basis points above LIBOR to borrow under the facility. The bank loan matures on March 26, 2014. The loan is one of the biggest gainers and losers among 153 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Hawker Beechcraft Hawker Beechcraft Acquisition Company, LLC, headquartered in Wichita, Kansas, manufactures business jets, turboprops and piston aircraft for corporations, governments and individuals worldwide. Hawker Beechcraft reported a net loss of $631.90 million on $2.43 billion of sales in 2011, compared with a net loss of $304.30 million on $2.80 billion of sales in 2010. Hawker Beechcraft Inc. and 17 affiliates filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-11873) on May 3, 2012, having already negotiated a plan that eliminates $2.5 billion in debt and $125 million of annual cash interest expense. The plan, to be filed by June 30, will give 81.9% of the new stock to holders of $1.83 billion of secured debt, while 18.9% of the new shares are for unsecured creditors. The proposal has support from 68% of secured creditors and holders of 72.5% of the senior unsecured notes. Hawker is 49%-owned by affiliates of Goldman Sachs Group Inc. and 49%-owned by Onex Corp. The Company's balance sheet at Dec. 31, 2011, showed $2.77 billion in total assets, $3.73 billion in total liabilities and a $956.90 million total deficit. Other claims include pensions underfunded by $493 million. Hawker's legal representative is Kirkland & Ellis LLP, its financial advisor is Perella Weinberg Partners LP and its restructuring advisor is Alvarez & Marsal. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Sidley Austin LLP serves as legal counsel and Houlihan Lokey Howard & Zukin Capital Inc. serves as financial advisor to the DIP Agent and the Prepetition Agent. Wachtell, Lipton, Rosen & Katz represents an ad hoc committee of senior secured prepetition lenders holding 70% of the loans. Milbank, Tweed, Hadley & McCloy LLP represents an ad hoc committee of holders of the 8.500% Senior Fixed Rate Notes due 2015 and 8.875%/9.625% Senior PIK Election Notes due 2015 issued by Hawker Beechcraft Acquisition Company LLC and Hawker Beechcraft Notes Company. The members of the Ad Hoc Committee -- GSO Capital Partners, L.P. and Tennenbaum Capital Partners, LLC -- hold claims or manage accounts that hold claims against the Debtors' estates arising from the purchase of the Senior Notes. Deutsche Bank National Trust Company, the indenture trustee for senior fixed rate notes and the senior PIK-election notes, is represented by Foley & Lardner LLP. An Official Committee of Unsecured Creditors appointed in the case has selected Daniel H. Golden, Esq., and the law firm of Akin Gump Strauss Hauer & Feld LLP as legal counsel. HEALTH CARE REIT: Fitch Rates $1-Bil. Preferred Stock at 'BB+' -------------------------------------------------------------- Fitch Ratings assigns a credit rating of 'BBB' to the $250 million Canadian Dollar (CAD) denominated term loan that matures July 27, 2015 issued by Health Care REIT, Inc. (NYSE: HCN). The loan is coterminous with HCN's $2 billion unsecured credit facility and bears interest at 145 basis points above the Canadian Dollar banker's acceptance rate. The loan also has an accordion feature to expand the loan to a total of $500 million CAD and serves as a natural currency hedge with respect to the company's recent Canadian acquisition with Chartwell Seniors Housing REIT (TSX: CSH.UN). Proceeds will be used to repay balances on the unsecured credit facility and for general corporate purposes. Separately, on June 20, 2012 HCN announced that its largest tenant Genesis HealthCare (16.4% of investment balance as of March 31, 2012) entered an agreement to purchase Sun Healthcare Group (NASDAQ GS: SUNH) in a $300 million transaction. HCN noted that the combination of Genesis HealthCare and Sun Healthcare Group will create the largest provider of post-acute and skilled nursing services in the country with over 420 facilities located in 29 states. Genesis' corporate fixed-charge coverage is expected to remain unchanged in the near term, but may benefit longer-term from operational efficiencies. HCN currently has 18 facilities leased to Sun Healthcare that will be added to the master lease with Genesis, generating a nominal improvement in facility level payment coverage of the Genesis lease. Fitch views the acquisition as having a negligible impact to the credit profile of HCN in the near term but is a longer-term credit positive as operator consolidation leads to increased operator efficiencies and coverage levels. Fitch currently rates HCN as follows: -- Issuer Default Rating (IDR) 'BBB'; -- $2 billion senior unsecured credit facility 'BBB'; -- $4.8 billion senior unsecured notes 'BBB'; -- $662 million senior unsecured convertible notes 'BBB'; -- $1 billion preferred stock 'BB+'. The Rating Outlook is Stable. The 'BBB' IDR takes into account HCN's broad healthcare real estate platform that contributes toward a fixed-charge coverage ratio that is consistent with the rating, as well as leverage that is appropriate for a 'BBB' rated healthcare real estate investment trust (REIT). HCN also has good access to capital and a solid liquidity position, including contingent liquidity from unencumbered assets. Credit concerns include operational volatility associated with the company's RIDEA-related investments, regulatory risks affecting the healthcare REIT sector, and modest operator concentration related to Genesis HealthCare. The company's payor sources are 73% private pay (pro forma for the Chartwell acquisition), limiting government reimbursement risk. As a result, Fitch does not expect that the June 28, 2012 U.S. Supreme Court decision on the Patient Protection and Affordable Care Act of 2010 will materially impact HCN's business in the near term. Cash flow (EBITDARM) coverage ratios of HCN's tenants were 1.8x on average as of March 31, 2012 which insulates the company against potential tenant cash flow deterioration, despite the potential ramifications of the Supreme Court decision for certain of HCN's tenants that rely on government reimbursements. As noted in Fitch's 2012 midyear REIT outlook, primary industry concerns for the remainder of 2012 relate to how skilled-nursing facility operators are dealing with the 11.1% cut in Medicare reimbursements and their ability to manage an additional 2% Medicare cut in 2013 mandated by the Budget Control Act of 2011. These regulatory risks have been more significant for healthcare REITs with tenants that are more reliant upon government reimbursement. Fixed-charge coverage is appropriate for the 'BBB' rating. Trailing 12 month fixed-charge coverage as of March 31, 2012 was 2.3 times (x), up slightly from 2.2x in 2011 but down from 2.6x in 2010 and 3.1x in 2009. Fitch defines fixed-charge coverage as recurring operating EBITDA including Fitch's estimate of recurring cash distributions from unconsolidated entities less recurring capital expenditures and straight-line rent adjustments divided by total interest incurred and preferred dividends. Fitch anticipates that coverage will increase to the mid-to-high 2.0x range through 2013, driven principally by solid projected operating fundamentals. In a more adverse case than anticipated by Fitch, coverage could decline to 2.1x in 2013, which is more commensurate with a 'BBB-' rating for a healthcare REIT. Leverage is appropriate for the 'BBB' rating. Net debt as of March 31, 2012 to first quarter 2012 annualized recurring EBITDA was 5.6x, compared to 6.6x at Dec. 31, 2011. In a more adverse case than currently anticipated by Fitch, leverage could rise above 8.0x over the next 12 to 24 months, which would be consistent with a rating lower than 'BBB'. HCN exhibits strong access to capital, having raised $2.2 billion of common and preferred equity and unsecured debt in 2012, in addition to $4.3 billion of total debt and equity in 2011 to fund acquisition and development. The company's liquidity is strong pro forma for the recent capital transactions and acquisitions subsequent to quarter-end. Sources of liquidity (unrestricted cash, unsecured revolving credit facility availability and projected retained cash flows from operating activities after dividends) divided by uses of liquidity (debt maturities, projected recurring capital expenditures and projected development expenditures) was 2.4x for April 1, 2012 to Dec. 31, 2013. Liquidity coverage would improve to 2.9x if 80% of secured debt is refinanced. The company also benefits from a well-laddered maturity schedule. Through 2013 the company has only 13.8% of total debt maturing (including HCN's pro rata share of joint venture debt maturities), and no more than 15% of total debt maturing in any given year through 2018. HCN also has good contingent liquidity due to the presence of a large unencumbered property pool. Unencumbered assets (unencumbered annualized 1Q'12 net operating income [NOI] divided by a stressed 9% cap rate) to unsecured debt was 2.3x, which is appropriate for the 'BBB' rating. The portfolio exhibits the potential for increased cash flow volatility from recent acquisitions in RIDEA operating partnerships, which represent 15.9% of total annualized 1Q'12 NOI, or 19.8% of investment balance at March 31, 2012 (22% pro forma for the recent Canadian acquisition). Separately, the Centers for Medicare and Medicaid Services (CMS) announced in July 2011 that it was reducing Medicare skilled-nursing facility (SNF) Prospective Payment System (PPS) payments in fiscal 2012 by $3.87 billion or 11.1% relative to fiscal 2011. While HCN's tenants exhibit adequate rent (EBITDARM) coverage of 1.35x for the seniors housing triple net portfolio and 2.0x for the SNF portfolio, reductions in SNF PPS will likely result in additional moderate declines in cash flow coverage. This change in reimbursement is indicative of the overall regulatory risk that the healthcare REIT sector will continue to endure, especially given government budget issues. HCN's portfolio exhibits moderate tenant concentration resulting from the 2011 acquisition of certain assets of Genesis HealthCare. As of March 31, 2012, Genesis was the largest tenant, representing 16.4% of invested capital. The exposure to Genesis will rise nominally subsequent to the recently announced acquisition by Genesis of Sun Healthcare Group. The next largest tenant is Merrill Gardens at 7.5% of invested capital. The large concentration exposes HCN to increased individual tenant credit risk. The Stable Outlook centers on HCN's solid credit metrics, laddered debt maturity schedule and strong liquidity position. The Outlook also takes into account Fitch's view that assets within the senior healthcare sector will continue to benefit from solid fundamentals, positive demographic trends, and limited new supply. The two-notch differential between HCN's IDR and preferred stock rating is consistent with Fitch's criteria for corporate entities with an IDR of 'BBB'. Based on Fitch research titled 'Treatment and Notching of Hybrids in Nonfinancial Corporate and REIT Credit Analysis', available on Fitch's web site at 'www.fitchratings.com', these preferred securities are deeply subordinated and have loss absorption elements that would likely result in poor recoveries in the event of a corporate default. The following factors may result in positive momentum in the ratings and/or Rating Outlook: -- Fixed-charge coverage sustaining above 3.0x (fixed charge coverage was 2.3x at March 31, 2012, but is expected to improve pro forma for recent acquisitions and the refinancing of preferreds); -- Leverage sustaining below 5.0x (as of March 31, 2012, leverage was 5.6x); -- Unencumbered assets-to-unsecured debt sustaining above 3.0x (unencumbered annualized 1Q'12 NOI divided by a stressed 9% cap rate to unsecured debt was 2.3x as of March 31, 2012). The following factors may result in negative momentum in the ratings and/or Rating Outlook: -- Fixed-charge coverage sustaining below 2.5x; -- Leverage sustaining above 6.0x; -- Deteriorating tenant/operator cash flow coverage of rent; -- Unencumbered assets-to-unsecured debt sustaining below 2.0x; -- A base case liquidity coverage ratio sustaining below 1.0x. HOMELAND SECURITY: YA Global Forbearance Extended to Aug. 31 ------------------------------------------------------------ Homeland Security Capital Corporation entered into the Second Amendment to the Amended and Restated Forbearance Agreement, dated Oct. 26, 2011, as amended, entered into by and among YA Global Investments, L.P., as lender, the Company and certain of its subsidiaries, pursuant to which the Lender agreed to extend the Forbearance Period by amending the definition of "Termination Date" to Aug. 31, 2012. As amended, the Forbearance Period now ends on the earlier of (i) Aug. 31, 2012, and (ii) the occurrence of a "Termination Event," defined in the Agreement, as (i) the failure of the Company or any Guarantor to perform or comply with any term or condition of the Agreement; (b) the determination by the Lender that any warranty or representation made by the Company or any Guarantor in connection with the Agreement was false or misleading; (c) the occurrence of a materially adverse change in or to the collateral granted to the Lender under the Financing Documents or pursuant to the Agreement, as determined by the Lender in its sole and exclusive discretion; and (d) the occurrence of any default or Event of Default under the Financing Documents. Although the Amendment is dated June 15, 2012, the Amendment was not effective until June 29, 2012, when signature pages were exchanged. A copy of the Amended Forbearance is available for free at: http://is.gd/99jn9R About Homeland Security Homeland Security Capital Corporation is an international provider of specialized technology-based radiological, nuclear, environmental disaster relief and electronic security solutions to government and commercial customers. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Coulter & Justus, P.C., in Knoxville, Tennessee, noted that Related Party Senior Notes Payable totalling $5.55 million are due and payable. As of Dec. 31, 2011, the Company has a net capital deficiency in addition to a working capital deficiency, which raises substantial doubt about its ability to continue as a going concern. The Company also reported a net loss of $3.98 million on $0 of net revenue for the year ended June 30, 2011. The Company's balance sheet at March 31, 2012, showed $9.92 million in total assets, $12.26 million in total liabilities, $169,768 in warrants payable, and a $2.51 million total stockholders' deficit. HORIZON LINES: Board Grants CEO 3-Mil. Restricted Stock Units ------------------------------------------------------------- The Board of Directors of Horizon Lines, Inc., granted Samuel A. Woodward, the Company's President and Chief Executive Officer, 3,000,000 restricted stock units. The grant was made pursuant to the employment agreement between Mr. Woodward and the Company. One half (1,500,000) of the RSUs will vest on the following dates if Mr. Woodward remains in continuous employment with the Company: -- 250,000 RSUs on Dec. 31, 2012; -- 500,000 RSUs on Dec. 31, 2013; -- 500,000 RSUs on Dec. 31, 2014; and -- 250,000 RSUs on June 30, 2015. The other half (1,500,000) of the RSUs will vest on the following dates if Mr. Woodward remains in continuous employment with the Company and certain performance goals established by the Board or the Compensation Committee have been met: -- 250,000 RSUs on Dec. 31, 2012; -- 625,000 RSUs on Dec. 21, 2013; and -- 625,000 RSUs on Dec. 31, 2014. If any of the performance based RSUs do not vest on their assigned performance date solely because the performance goals are not met, then those RSUs will remain outstanding and will be eligible to vest on subsequent performance dates to the extent performance goals are established and met for that subsequent year. All of the RSUs carry dividend equivalent rights. If Mr. Woodward's employment is terminated as a result of his death or disability, Mr. Woodward's time-based RSUs will immediately vest and become payable, and Mr. Woodward's performance based RSUs will pro-ratably vest for the year in which his employment terminates, contingent upon performance goal achievement for that year. If Mr. Woodward's employment is terminated by the Company without cause or if he terminates his employment for good reason, a pro- rata portion of Mr. Woodward's unvested, time-based RSUs that would have vested at the end of the year of the termination will immediately vest and become payable, and Mr. Woodward's performance based RSUs will pro-ratably vest for the year in which his employment terminates, contingent upon performance goal achievement for that year. In the event of a change of control of the Company, all of Mr. Woodward's unvested time-based RSUs and his unvested performance based RSUs will vest immediately and be paid at the time of the change of control. About Horizon Lines Charlotte, N.C.-based Horizon Lines, Inc. (NYSE: HRZ) is the nation's leading domestic ocean shipping and integrated logistics company. The Company owns or leases a fleet of 20 U.S.-flag containerships and operates five port terminals linking the continental United States with Alaska, Hawaii, Guam, Micronesia and Puerto Rico. The Company provides express trans-Pacific service between the U.S. West Coast and the ports of Ningbo and Shanghai in China, manages a domestic and overseas service partner network and provides integrated, reliable and cost competitive logistics solutions. Horizon Lines reported a net loss of $229.41 million in 2011, a net loss of $57.97 million in 2010, and a net loss of $31.27 million in 2009. Refinancing The Company was not in compliance with the maximum senior secured leverage ratio and the minimum interest coverage ratio under its Senior Credit Facility at the close of its third fiscal quarter ended Sept. 25, 2011. Non-compliance with these financial covenants constituted an event of default, which could have resulted in acceleration of the maturity. None of the indebtedness under the Senior Credit Facility or Notes was accelerated prior to the completion of a comprehensive refinancing on Oct. 5, 2011. The Senior Credit Facility and 99.3% of the 4.25% Convertible Senior Notes were repaid as part of the refinancing. In addition, as a result of the completion of the refinancing, the short-term obligations under the Senior Credit Facility, the Notes and the Bridge Loan have been classified as long-term debt. As a result of the efforts to refinance the Company's debt and the 2011 amendments to the Senior Credit Facility, the Company paid $17.3 million in financing costs and recorded a loss on modification of debt of $0.6 million during 2011. The Company's balance sheet at March 25, 2012, showed $640.74 million in total assets, $828.54 million in total liabilities, and a $187.79 million total stockholders' deficiency. * * * As reported by the TCR on Aug. 26, 2011, Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Horizon Lines Inc. to 'SD' from 'CCC'. The rating action on Horizon Lines follow the company's decision to defer the interest payment on its $330 million senior convertible notes due August 2012, exercising the 30-day grace period. "Under our criteria, we view failure to make an interest payment within five business days after the due date for payment a default, regardless of the length of the grace period contained in an indenture," said Standard & Poor's credit analyst Funmi Afonja. HOSPITAL AUTHORITY OF CHARLTON: Ch. 9 Dismissed, Not Converted -------------------------------------------------------------- The Hospital Authority of Charlton County failed to convince a bankruptcy judge to have its Chapter 9 case converted to a restructuring under Chapter 11. Instead, the court sided with the U.S. Trustee and dismissed the case. Both parties agree that the Hospital Authority is not eligible for chapter 9, but the parties differ in their theories. According to the U.S. Trustee, the Hospital Authority is not eligible to be a debtor under chapter 9 because the Bankruptcy Code requires specific state authorization for an entity to file chapter 9, and the state of Georgia explicitly prohibits authorities created pursuant to state law from filing a petition for debt relief. According to the Hospital Authority, it is not eligible for chapter 9 because it is not a "municipality" as required by 11 U.S.C. Sec. 109(c)(1). Under 11 U.S.C. Sec. 101(40), "municipality" to mean a "political subdivision or public agency or instrumentality of a State". The Hospital Authority seeks to convert the case to chapter 11. However, the U.S. Trustee argues that the Hospital Authority is not eligible for chapter 11 because it is a "governmental unit," and therefore not a "person" entitled to chapter 11 relief. Bankruptcy Judge John S. Dalis said the Hospital Authority is a creature of specific legislative enactment. It was created pursuant to the state of Georgia's Hospital Authorities Law. The Hospital Authority can exercise the right of eminent domain to acquire property. It is exempt from paying taxes in the same way cities and counties are exempt from taxes for the operation of similar facilities. It is authorized to receive tax revenues from the County's general fund or from an ad valorem tax. The Hospital Authority is also authorized to issue tax-exempt revenue anticipation certificates which are declared to be issued for an essential public and governmental purpose. "Because I find that the Hospital Authority is not eligible to be a debtor under chapter 11, I do not reach the issue of whether conversion from chapter 9 to chapter 11 is procedurally possible without a Bankruptcy Code provision that provides for conversion of a case from chapter 9 to another chapter," Judge Dalis added. In his ruling, Judge Dalis cited opinions in previous cases, including In re Cnty. of Orange, 183 B.R. 594, 602 (Bankr. CD. Cal. 1995), and In re N. Mariana Islands Ret. Fund, No. 12-00003, slip op. at 7 (Bankr. D.N.M.I. June 13, 2012). A copy of the Court's July 3, 2012 Opinion and Order is available at http://is.gd/afCFMBfrom Leagle.com. About Hospital Authority of Charlton Hospital Authority of Charlton County, Georgia, filed a Chapter 9 petition (Bankr. S.D. Ga. Case No. 12-50305) in Waycross, Georgia, on April 30, 2012. The authority owns the Charlton Memorial Hospital in Fall River, Georgia. The Charlton Memorial Hospital is a 25-bed critical access hospital and treats 67,000 patients in its emergency department each year. The hospital is/was managed by St. Vincent's. The Hospital Authority and the Charlton County are defendants to a contract suit filed by St. Vincent's Health System, Inc., in district court (M.D. Fla. Case No. 3:2012cv00285) on March 14, 2012, according to Justia.com. Bankruptcy Judge John S. Dalis oversees the case. C. James McCallar, Jr., Esq., at McCallar Law Firm, serves as the Debtor's counsel. The Debtor scheduled $8,937,298 in total assets and $4,919,654 in total liabilities in its Chapter 9 petition. INDYMAC BANCORP: Officers Settle Class Suit for $6.5 Million ------------------------------------------------------------ Dow Jones Newswires' Patrick Fitzgerald reports that the former leaders of failed IndyMac Bancorp, including ex-Chief Executive Michael Perry and former finance chief Scott Keys, have agreed to settle a class-action securities lawsuit stemming from the bank- holding company's collapse in 2008. In a settlement outlined in U.S. District Court in Los Angeles, IndyMac's insurers will pay $6.5 million in cash to investors who had sued the company's leaders for securities fraud. Under the deal, Messrs. Perry and Keys didn't admit wrongdoing. The $6.5 million will come from IndyMac's directors' and officers' liability insurance, which recently was estimated to have $80 million left untapped. IndyMac shareholders sued Messrs. Perry and Keys in June 2008 over allegations they had misled investors about the failed mortgage lender's deteriorating financial condition. The following month federal bank regulators seized and closed IndyMac's thrift, IndyMac Bank. Mr. Perry is represented by D. Jean Veta, Esq., a partner at Covington & Burling. Mr. Perry is also facing a lawsuit by the Federal Deposit Insurance Corp. for $600 million. About IndyMac Bancorp Based in Pasadena, California, IndyMac Bancorp Inc. (NYSE:IMB) -- http://www.indymacbank.com/-- was the holding company for IndyMac Bank FSB, a hybrid thrift/mortgage bank that originated mortgages in all 50 states of the United States. Through its hybrid thrift- mortgage bank business model, IndyMac designed, manufactured, and distributing cost-efficient financing for the acquisition, development, and improvement of single-family homes. IndyMac also provided financing secured by single-family homes to facilitate consumers' personal financial goals and strategically invests in single-family mortgage-related assets. On July 11, 2008, the Office of Thrift Supervision closed IndyMac Bank and appointed FDIC as the bank's receiver. Thacher Proffitt & Wood LLP was engaged as counsel to the FDIC. Indymac Bancorp filed for Chapter 7 bankruptcy protection (Bankr. C.D.Calif., Case No. 08-21752) on July 31, 2008. At the time of the FDIC takeover, IndyMac was the third-largest bank failure in U.S. history. Indymac had about $32.01 billion in assets as of July 11, 2008. In court documents, IndyMac disclosed estimated assets of $50 million to $100 million and estimated debts of $100 million to $500 million. Representing the Debtor are Dean G. Rallis, Jr., Esq., and John C. Weitnauer, Esq. IndyMac's banking operations, now known as OneWest Bank FSB, are under the control of a new ownership group that includes hedge- fund managers John Paulson and George Soros. JOHN L SMITH: Failed Investments May Result in Bankruptcy Filing ---------------------------------------------------------------- Arkansas Razorbacks head coach is planning to file for bankruptcy, Kurt Voigt at The Associated Press reports. According to AP, Mr. Smith said that his land investments started through acquaintances while he was the coach at Louisville from 1998-2002, starting with one subdivision development. Mr. Smith described his stake as being in the "multi-millions", AP relates. Mr. Smith said that he and his partners faced a difficult time maintaining their investments as the real estate market started to slow several years ago, AP states. "At that point, the bank was willing to give away money. We got in over our head with land, and then the bubble burst and all this land value dropped and we couldn't sustain it," the report quoted Mr. Smith as saying. According to the report, Mr. Smith wasn't sure how much money he owed to creditors, including some of his former partners. AP relates that John Mason, one of Mr. Smith's former partners, filed for bankruptcy in December 2011 in Kentucky, listing Mr. Smith as one of his creditors. Mr. Mason's filing listed $250,000 in debt to one of Mr. Smith's investment limited liability corporations, and also listed an unknown amount of debt to Mr. Smith personally. Mr. Smith is represented by attorney Jim Dowden in Little Rock and has representation in Kentucky, AP reports. John L. Smith is the head coach of the Arkansas Razorbacks, University of Arkansas' football team. KLAL INC.: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Klal Inc. dba Super 8 540 E. Central TX Expressway Harker Heights, TX 76548 Bankruptcy Case No.: 12-60739 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Western District of Texas (Waco) Judge: Craig A. Gargotta Debtor's Counsel: Johnny W. Thomas, Esq. JOHNNY W. THOMAS, LAW OFFICE, P.C. St. Paul Square 1153 E. Commerce Street San Antonio, TX 78205 Tel: (210) 226-5888 E-mail: 1thomas@prodigy.net Scheduled Assets: $2,199,435 Scheduled Liabilities: $2,206,614 A copy of the Company's list of its three largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txwb12-60739.pdf The petition was signed by Saroj Patel, secretary. KSK PLAZA: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------- Debtor: KSK Plaza, LLC 1379 Park Western, Apartment 254 San Pedro, CA 90732 Bankruptcy Case No.: 12-34318 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Eric A. Liepins, Esq. ERIC A. LIEPINS, P.C. 12770 Coit Road, Suite 1100 Dallas, TX 75251 Tel: (972) 991-5591 E-mail: eric@ealpc.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 six largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txnb12-34318.pdf The petition was signed by Ki sang Kim, sole member. KV PHARMACEUTICAL: FDA Issues Further Guidance About Makena ----------------------------------------------------------- K-V Pharmaceutical Company addressed the additional guidance provided by the U.S. Food and Drug Administration, which issued a Questions and Answers document on June 29 to clarify its June 15, 2012, statement on compounded versions of hydroxyprogesterone caproate (the active ingredient in Makena). FDA provides further guidance to healthcare providers and pregnant women at high risk for recurrent preterm birth, recommending the use of FDA-approved Makena rather than compounded drug formulations of hydroxyprogesterone caproate. The agency also describes its enforcement policy towards compounded formulations of hydroxyprogesterone caproate. Makena is the only FDA-approved medication indicated to reduce the risk of preterm birth in women with a singleton pregnancy who have a history of singleton spontaneous preterm birth. FDA's June 29, 2012 Q&A can be found at http://is.gd/l7Uubs "It is important for healthcare providers to take the time to read and understand FDA's Questions and Answers document issued on June 29, and counsel patients accordingly," said Douglas Laube, M.D., M.Ed., Professor, Department of Obstetrics and Gynecology, University of Wisconsin Medical School, and Former President, ACOG. "I encourage the medical community to help resolve issues in disparity of care that may have resulted from confusion about the differences between FDA-approved and compounded products, and work together towards addressing the issue of prematurity in the United States." About KV Pharmaceutical Company KV Pharmaceutical Company (NYSE: KVa/KVb) -- http://www.kvpharmaceutical.com/-- is a fully integrated specialty pharmaceutical company that develops, manufactures, markets, and acquires technology-distinguished branded and generic/non-branded prescription pharmaceutical products. The Company markets its technology distinguished products through ETHEX Corporation, a subsidiary that competes with branded products, and Ther-Rx Corporation, the company's branded drug subsidiary. The Company reported a net loss of $102.30 million for the year ended March 31, 2012, a net loss of $271.70 million for the year ended March 31, 2011, and a net loss of $283.60 million for the year ended March 31, 2010. The Company's balance sheet at March 31, 2012, showed $253.40 million in total assets, $734.10 million in total liabilities and a $480.70 million total shareholders' deficit. BDO USA, LLP, in Chicago, Illinois, 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 among other things has experienced recurring losses from operations, has a significant shareholders' deficit, and negative working capital; the potential inability of the Company to raise additional capital or debt financing; a potential cash shortfall in meeting near term obligations; significant uncertainties related to litigation and governmental inquiries; and potential debt covenant violations. These factors raise substantial doubt about the Company's ability to continue as a going concern. LANDAMERICA 1031: 4th Cir. Affirms Ruling in Suit v. SunTrust ------------------------------------------------------------- The U.S. Court of Appeals for the Fourth Circuit affirmed a ruling by the U.S. District Court for the District of South Carolina dismissing with prejudice all claims against SunTrust Banks, Inc., in diversity actions, which have been consolidated for pre-trial proceedings in the District Court by the Judicial Panel on Multi- District Litigation. The plaintiff-appellants are the named representatives of putative classes consisting of approximately 400 members that engaged LandAmerica 1031 Exchange Services, Inc., as "qualified intermediary" between February and November 2008. LES acted as QI in the exchange of investment properties pursuant to 26 U.S.C. Sec. 1031(a)(1). The District Court ruled LES did not assume fiduciary duties with respect to the proceeds of the sale of relinquished properties. Accordingly, SunTrust -- which had held LES's general operating account, sold LES certain securities, and extended LES a line of credit -- could not be liable for aiding and abetting the breach of a fiduciary duty by LES. The District Court also dismissed the Exchangers' claim of civil conspiracy. The cases are: GERALD R. TERRY; ANN T. ROBBINS; JANE T. EVANS, on their own behalf and on behalf of a class of others similarly situated, Plaintiffs-Appellants, v. SUNTRUST BANKS, INC., Defendant- Appellee, and THEODORE L. CHANDLER, JR.; CHRISTINE R. VLAHCEVIC; G. WILLIAM EVANS; RONALD B. RAMOS; DEVON M. JONES; STEPHEN CONNER, Defendants. ANGELA M. ARTHUR, as Trustee of the Arthur Declaration of Trust, dated December 29, 1988, and all similarly situated; VIVIAN R. HAYS, an individual, and all others similarly situated; LEAPIN EAGLE LLC, a limited liability company, and all others similarly situated; DENISE J. WILSON, an individual, and all others similarly situated, Plaintiffs-Appellants, v. SUNTRUST BANKS, INC., a Georgia corporation, Defendant-Appellee, and G. WILLIAM EVANS, an individual; STEPHEN CONNOR, an individual, Defendants. Nos. 11-1704, 11-1707 (4th Cir.). A copy of the Fourth Circuit's July 2, 2012 decision is available at http://is.gd/G9GBkDfrom Leagle.com. About LandAmerica Financial LandAmerica Financial Group, Inc., provided real estate transaction services with offices nationwide and a vast network of active agents. LandAmerica Financial Group and its affiliate LandAmerica 1031 Exchange Services Inc. filed for Chapter 11 protection (Bankr. E.D. Va. Lead Case No. 08-35994) on Nov. 26, 2008. Attorneys at Willkie Farr & Gallagher LLP and McGuireWoods LLP served as co-counsel. Zolfo Cooper served as restructuring advisor. Epiq Bankruptcy Solutions served as claims and notice agent. Attorneys at Akin Gump Strauss Hauer & Feld LLP and Tavenner & Beran PLC served as counsel to the Creditors Committee of 1031 Exchange. Bingham McCutchen LLP and LeClair Ryan served as counsel to the Creditors Committee of LFG. In its bankruptcy petition, LFG reported total assets of $3.325 billion and total debts of $2.839 billion as of Sept. 30, 2008. Between March 6 and Nov. 4, 2009, various LFG affiliates -- LandAmerica Assessment Corporation, LandAmerica Title Company, Southland Title Corporation, Southland Title of Orange County, Southland Title of San Diego, LandAmerica Credit Services, Inc., Capital Title Group, Inc., and LandAmerica OneStop Inc. -- also commenced voluntary Chapter 11 cases. The Chapter 11 cases of LFG, LES, and the LFG Affiliates were jointly administered under case number 08-35994. LandAmerica filed a Joint Plan of Liquidation on Sept. 9, 2009. The Court on Nov. 23, 2009, entered an order confirming a Nov. 16 version of the Joint Chapter 11 Plan of LFG and its Affiliated Debtors, as to all Debtors other than OneStop. The effective date with respect to the Plan was Dec. 7, 2009. Plan trustees were appointed for LFG and LES. The Plan as to OneStop was confirmed on Feb. 16, 2010, and declared effective as of March 1, 2010. LANDAMERICA FINANCIAL: Commonwealth to Pay $11MM to Settle Suit --------------------------------------------------------------- Zach Winnick at Bankruptcy Law360 reports that U.S. District Judge Jeffrey S. White on Thursday preliminarily approved an $11 million class settlement of claims that Commonwealth Land Title Co. and others defrauded nearly 400 investors by helping LandAmerica Financial Group Inc. orchestrate a Ponzi scheme that cost the investors $191 million. Judge White signed off on the deal Thursday, a move that will help trigger an additional $36.8 million payment to the 383 class members in a related bankruptcy settlement, according to court filings cited by Bankruptcy Law360. About LandAmerica Financial LandAmerica Financial Group, Inc., provided real estate transaction services with offices nationwide and a vast network of active agents. LandAmerica Financial Group and its affiliate LandAmerica 1031 Exchange Services Inc. filed for Chapter 11 protection (Bankr. E.D. Va. Lead Case No. 08-35994) on Nov. 26, 2008. Attorneys at Willkie Farr & Gallagher LLP and McGuireWoods LLP served as co-counsel. Zolfo Cooper served as restructuring advisor. Epiq Bankruptcy Solutions served as claims and notice agent. Attorneys at Akin Gump Strauss Hauer & Feld LLP and Tavenner & Beran PLC served as counsel to the Creditors Committee of 1031 Exchange. Bingham McCutchen LLP and LeClair Ryan served as counsel to the Creditors Committee of LFG. In its bankruptcy petition, LFG reported total assets of $3.325 billion and total debts of $2.839 billion as of Sept. 30, 2008. On March 6, 2009, March 27, 2009, March 31, 2009, July 17, 2009, Oct. 12, 2009, and Nov. 4, 2009, various LFG affiliates -- LandAmerica Assessment Corporation, LandAmerica Title Company, Southland Title Corporation, Southland Title of Orange County, Southland Title of San Diego, LandAmerica Credit Services, Inc., Capital Title Group, Inc., and LandAmerica OneStop Inc. -- also commenced voluntary Chapter 11 cases. The Chapter 11 cases of LFG, LES, and the LFG Affiliates are jointly administered under case number 08-35994. LandAmerica filed a Joint Plan of Liquidation on Sept. 9, 2009. The Court on Nov. 23, 2009, entered an order confirming the Joint Chapter 11 Plan of LFG and its Affiliated Debtors, dated Nov. 16, 2009, as to all Debtors other than OneStop. The effective date with respect to the Plan was Dec. 7, 2009. Plan trustees were appointed for LFG and LES. LAPOUR GRAND: To File for Chapter 11 Bankruptcy to Foil Receiver ---------------------------------------------------------------- Tim O'Reiley at Las Vegas Review-Journal reports that Clark County District Court Judge Elizabeth Gonzalez has cleared the way for a receiver to take control of the Holsum Lofts office and retail complex, but it may never happen. According to the report, an attorney for LaPour Grand Central LLC, which owns the pioneering attempt at downtown redevelopment, said the company would soon filed for Chapter 11 bankruptcy protection. Federal bankruptcy law halts all other collection actions to give debtors some breathing space while they try to restructure their finances. The report says LaPour attorney Kimberly McGhee, Esq., did not specify when the bankruptcy would be filed. According to the report, LaPour could not refinance the mortgage on the property and defaulted early last year. The principal balance stood at $6.5 million. The report says regular payments on the loan resumed although the foreclosure process had been initiated. In April, the loan was sold to an entity called Holsum Note 231241, the principals of which have not be identified. The report says Holsum Note said in court papers that LaPour has been withholding rent payments collected from tenants, an important component of the collateral. LEE'S FORD DOCK: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Lee's Ford Dock, Inc. 451 Lee's Ford Dock Road Nancy, KY 42544 Bankruptcy Case No.: 12-60818 Chapter 11 Petition Date: July 4, 2012 Court: United States Bankruptcy Court Eastern District of Kentucky (London) About the Debtor: Lee's Ford Dock owns the Lee's Ford Resort Marina -- http://www.leesfordmarina.com/-- a recreational marina resort on Lake Cumberland, 3 miles from Somerset, Kentucky. The resort offers world class lodging, lake-front cottages as well as houseboat and vacation rentals. Debtor's Counsel: Laura Day DelCotto, Esq. DELCOTTO LAW GROUP PLLC 200 North Upper St. Lexington, KY 40507 Tel: (859) 231-5800 Fax: (859) 281-1179 E-mail: ldelcotto@dlgfirm.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by James D. Hamilton, president. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Department of the Army Lease $138,305 Nashville District Corps of Engineers PO Box 1070 Nashville, TN 37202 BB&T Bankcard Corp. Credit Card $49,495 P.O. BOX 580503 Charlotte, NC 28258 Southern Petroleum, Trade Debt $37,435 Inc. PO Box 803 Somerset, KY 42502 US Foodservice/ Trade Debt $33,060 Knoxville Gordon's Food Service Trade Debt $24,083 Produce Distributors Trade Debt $6,681 Lowes Trade Debt $6,089 Donovan Marine, Inc. Trade Debt $3,757 Waste Connections of Utility $3,372 Ky, Inc. Epperson Electric Trade Debt $2,812 Eubank Electric Supply Trade Debt $1,281 Ira E. Clark Detective Trade Debt $1,224 Agency, Inc. Cumberland Electric Trade Debt $1,166 Supply Harris Publishing, Inc. Trade Debt $1,100 Commercial Refrigeration Trade Debt $948 of Ky, Inc. Taylor Enterprises of Trade Debt $701 Ky, Inc. Southern Belle Dairy Trade Debt $693 Cojo's Refrigeration Trade Debt $653 Pitney Bowes, Inc. Trade Debt $559 South Central Trade Debt $523 Janitorial LEHMAN BROTHERS: Court Keeps Objection to JPMorgan Claim Intact --------------------------------------------------------------- Bankruptcy Judge James M. Peck rejected the request of JPMorgan Chase Bank, N.A. to strike certain of the grounds for relief set forth the objection by Lehman Brothers Holdings Inc. and Lehman Brothers Inc. to the bank's proofs of claim related to losses that the bank allegedly incurred in the unwinding of complex triparty repo transactions. LBHI and its Official Committee of Unsecured Creditors prosecuted the objections. They argue that JPMorgan's claims as LBI's triparty repo custodian are greatly overstated because (i) JPMorgan did not sell the collateral securing its position in a commercially reasonable manner, (ii) certain of the losses are traceable to the actions of Barclays Capital Inc. and have already been settled, and (iii) JPMorgan improperly has added postpetition interest to the claim. JPMorgan moves to strike those parts of the Objection that are based upon its settlement with Barclays and its claim for postpetition interest. Judge Peck said the motion practice is a calculated effort by JPMorgan to preemptively cut away portions of the Objection. "This effort is taking place within the context of an ongoing larger multi-layered litigation concerning the net amounts that may ultimately be payable by these parties to one another, either by an agreed reconciliation and settlement or after a final judicial determination," he said. According to Judge Peck, the motions to strike are generally disfavored, and the benefit of any doubt at the pleading stage properly should go to the Objectors. "Allowing the Objectors the opportunity to continue advancing all points raised in the Objection and to present evidence in support of their multiple arguments to reduce the amount of JPMorgan's claim is appropriate and does not prejudice JPMorgan, especially in a setting such as this in which granting the Motion would not yield any measurable savings of time and expense or help to resolve other issues in dispute. Denial of the Motion is procedural and is not an indicator of how the Court will decide the substantive points raised in the Motion." JPMorgan served as the principal clearing bank for LBI as well as the agent for LBI's tri-party repurchase agreements. In its capacity as LBI's clearing bank, JPMorgan facilitated the clearance and settlement of securities trades by LBI. JPMorgan acted as agent and intermediary for LBI and its tri-party repo investors who purchased LBI's securities. In this capacity, each morning JPMorgan would advance funds to LBI to "unwind" all of LBI's triparty repo trades. On Sept. 19, 2008, prior to the commencement later that day of LBI's SIPA liquidation case, JPMorgan unwound certain of LBI's triparty repo trades resulting in an obligation to JPMorgan in the amount of $25,279,675,964. Securities held in LBI's clearance account served as collateral for that obligation. The Objectors assert that these securities, according to JPMorgan's records, had a market value of $27,218,845,261 and that cash and other incoming payments totaled $3,489,450,764. JPMorgan was also holding $8.6 billion of LBHI cash and money market funds. The transfer of those funds is the subject of an adversary proceeding that is pending against JPMorgan. JPMorgan filed Proof of Claim No. 4939 against LBI on May 29, 2009, to recover the deficiency resulting from the outstanding $25,279,675,964 in extensions of credit owed by LBI under the Clearance Agreement. On Sept. 22, 2009, JPMorgan filed Proof of Claim No. 6642 against LBHI in connection with LBHI's obligations under the parties' August and September guaranty agreements. JPMorgan amended the LBI Proof of Claim on March 31, 2010, and the LBHI Proof of Claim on April 1, 2010, after the parties entered into a Collateral Disposition Agreement, dated March 16, 2010. The amended LBI Proof of Claim states that, as of March 15, 2010, the amount of the deficiency had been reduced to $6,333,781,099 "principally by application of the sale proceeds of securities collateral . . . pledged by [LBI] pursuant to the Clearance Agreement to secure such claims. . . ." The Proofs of Claim also seek $280,224,670 in postpetition interest on the Deficiency Claim through the date of execution of the Collateral Disposition Agreement. In the hectic days immediately following commencement of the LBHI bankruptcy, a dispute arose between JPMorgan and Barclays based on the failure of Barclays to rollover a certain $15.8 billion repo. JPMorgan asserted that Barclays had reneged on an undertaking to refinance extensions of credit by JPMorgan to LBI under the Clearance Agreement and that as a result, JPMorgan was required to unwind a $15.8 billion overnight repo on Sept. 18, 2008. JPMorgan and Barclays, with the active encouragement of the Federal Reserve Bank of New York, promptly engaged in talks regarding their dispute, resulting in a Sept. 22, 2008 Services and Settlement Agreement. The SSA contained a settlement and mutual release between JPMorgan and Barclays whereby (i) JPMorgan and Barclays released each other with respect to certain disputes, including losses claimed as a result of Barclays' failure to roll over the $15.8 billion repo, and (ii) Barclays agreed to withdraw a then pending lawsuit against Bear Stearns Asset Management, an entity that recently had been acquired by JPMorgan. On Dec. 5, 2008, JPMorgan and Barclays entered into a second settlement agreement finally resolving the issues between them, including a dispute over $7 billion allegedly due from JPMorgan. Under the terms of the December Settlement Agreement, JPMorgan kept much of this $7 billion in cash, but in exchange agreed to transfer billions of dollars in securities and cash claimed by Barclays. This agreement still required Barclays to withdraw the Bear Stearns Lawsuit, a litigation of unknown value at the time that has been estimated by one witness to be worth approximately $400 million. JPMorgan and Barclays also released each other from all claims relating to the $7 billion that had been sought by Barclays, the $45 billion reverse repurchase transaction between Barclays and LBI for the refinancing of the Federal Reserve Bank of New York's Primary Dealer Credit Facility and other financings, and the securities delivered by LBI to Barclays on Sept. 18, 2008, as well as triparty repos related to LBI. A copy of the Court's July 3, 2012 Memorandum Decision is available at http://is.gd/9r2Debfrom Leagle.com. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. Lehman is set to make its first payment to creditors under its $65 billion payout plan on April 17, 2012. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LEHMAN BROTHERS: Asks for Flexibility in ADR Procedures ------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliates ask the Court to approve amended alternative dispute resolution procedures for affirmative claims under derivatives transactions with special purpose vehicle counterparties to improve the procedures as applied to transactions in which all or some of the Debtors' assets have been distributed under the Plan. According to Richard W. Slack, Esq., at Weil, Gotshal & Manges LLP, in New York, the Debtors have received a total of more than $1.1 billion new dollars as a result of settlements reached under the ADR Procedures. The Plan Administrator, however, believes that introducing certain additional flexibility into the SPV Derivatives ADR Procedures will aid the Debtors in reaching settlement and recovering funds due the estates especially in light of challenges that have arisen in the course of seeking to recover amounts owed to the Debtors. In particular, because in certain of the SPV Derivatives Transactions, funds due the estates already have been distributed to holders of notes or beneficial interests who are known to the Debtors, the amended SPV Derivatives ADR Procedures would allow the Debtors at their election to serve one or more noteholders directly and without the inclusion of an SPV Derivative Counterparty. The inclusion of an SPV Derivative Counterparty may unduly complicate the settlement process in certain circumstances when the funds at issue already have been distributed in whole or in part to one or more noteholders, who may therefore settle directly and on their own behalf with the Debtors. A full-text copy of the proposed amended SPV Derivatives ADR Procedures is available for free at: http://bankrupt.com/misc/lehman29164.pdf About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. Lehman is set to make its first payment to creditors under its $65 billion payout plan on April 17, 2012. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LEHMAN BROTHERS: Opposes Agostini Trust's Bid to Recover Property ----------------------------------------------------------------- A lawyer representing The Edward J. Agostini Living Trust and the Sylvia Agostini Living Trust seeks a court order requiring Lehman Brothers OTC Derivatives Inc. to return properties owned by the trusts. The properties consist of 3,592 shares of United Parcel Service Inc. and $209,687 in cash. The trusts delivered the properties to Lehman Brothers OTC in 2007 as collateral under certain derivative deals. Lehman Brothers Holdings Inc., as Plan Administrator for Lehman Brothers OTC Derivatives, Inc., asserts that the Court should deny the Motion because (i) determining the parties' entitlement to the UPS Shares and the UPS Dividends and issuing an order in accordance with such determination would be premature and a waste of the resources of the Court and LOTC, (ii) the Agostini Parties are not entitled to relief from the automatic stay pursuant to Section 362(d)(2), (iii) the Agostini Parties are not entitled to relief from the automatic stay pursuant to Section 362(d)(1), and (iv) the Motion is procedurally deficient. The Agostini Parties assert that their claims were properly filed against LOTC but the claims have not been scheduled for a hearing and LOTC had never communicated with them regarding the closeout of the Forward Contracts. "While other creditors have received substantial initial payments under the Reorganization Plan, the Agostini Parties have received nothing and LOTC has unilaterally adjourned a hearing on its objection without setting a date. Far from resolving these claims, LOTC seems to be delaying them." The Agostini Parties also note that there is no argument in favor of LOTC retaining the property. "It is the Agostini Parties who are entitled to the property and the automatic stay must be lifted in order to allow them to access to that property." Moreover, the Agostini Parties assert that to the extent an adversary proceeding needs to be filed to get the relief they seek, they will file an adversary proceeding. However, they point out, the record as to the Agostini Parties' undisputed ownership of the property at issue will present no factual issue that needs to be resolved in a plenary adversary proceeding. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. Lehman is set to make its first payment to creditors under its $65 billion payout plan on April 17, 2012. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LEHMAN BROTHERS: Opposes MM 156's $76-Mil. Loss of Profit Claim --------------------------------------------------------------- Lehman Brothers Holdings Inc., as Plan Administrator, seeks to disallow and expunge a claim filed by Middle Mountain 156, LLC, Claim No. 2974 for $76,004,383.40, which is based on "Loss of profit/lender defaul[t]." According to the Plan Administrator, the Middle Mountain Claim arises out of a real estate financing transaction pursuant to which LBHI agreed to lend Middle Mountain approximately $44 million. Middle Mountain subsequently defaulted on its repayment obligations under the loan and, in connection with a forbearance agreement, waived any and all claims it may have had against LBHI in connection with the loan. In an action brought by LBHI's successor in interest in the loan, the District Court found that the waivers contained in the forbearance agreement were valid and that Middle Mountain's principals, as guarantors of Middle Mountain's obligations under the loan, were therefore barred from asserting affirmative defenses against LBHI that were based on LBHI's alleged default under the loan. As the issues underlying the Middle Mountain Claim -- the enforceability of the forbearance agreement and LBHI's liability for alleged breaches of the loan -- were already litigated and decided in the District Court, Middle Mountain is barred by the doctrine of collateral estoppel from re-litigating them in connection with the Middle Mountain Claim. Further, even if the Middle Mountain Claim is not barred by the doctrine of collateral estoppel, the Court should find that Middle Mountain waived any and all of its claims against LBHI in the forbearance agreement and, accordingly, that Middle Mountain is barred from asserting such waived claims under the guise of the Middle Mountain Claim. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. Lehman is set to make its first payment to creditors under its $65 billion payout plan on April 17, 2012. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LEHMAN BROTHERS: AIG Says License Agreement Not a Lease ------------------------------------------------------- As reported in the Troubled Company Reporter in May, Lehman Brothers Holdings Inc. is asking the U.S. Bankruptcy in Manhattan to reduce AIG Global Services Inc.'s claim against the company to $5.43 million and allow it as a non-priority general unsecured claim. The claim, designated as Claim No. 66918, stemmed from the rejection of a license agreement dated March 31, 2004. AIG Global Services, f/k/a AIG Technologies, Inc., tells the Court that Lehman Brothers Inc., shortly after it filed for bankruptcy, reviewed the License Agreement for Use of Co-Location Space, dated as of March 31, 2004, in which AIG Global granted to Holdings a license to access the Facility and to make use of the Customer Space for the primary purpose of operating certain servers and other equipment. AIG Global notes that Holdings recognized the License Agreement for what it is -- a license. AIG Global pointed out that Holdings consistently acted on its position that the License Agreement was a license and not a lease -- it did not assume or reject the License Agreement within the time limit for leases of nonresidential property under Bankruptcy Code section 365(d)(4), and it chose instead to avail itself of the License Agreement's terms through June 2010. More than a year and a half after the bankruptcy filing, and long after the outside statutory deadline for either assuming a lease or surrendering leased nonresidential real property, Holdings rejected the License Agreement pursuant to a notice to reject an executory contract. Holdings now wishes to flip positions and argue that the License Agreement should be a lease in order to cap AIG Global's claim. Holding has waived its right to do so by its own intentional conduct. According to AIG Global, even if such an argument were permitted, Holdings fails to point to convincing evidence that the License Agreement should be treated as a lease. Holdings instead highlights a few provisions that can be found in a lease or a license, and it ignores a specific provision in the License Agreement in which it agreed that the License Agreement is a mere license and conveyed no leasehold interest to Holdings. Holdings fails to demonstrate the License Agreement should be recharacterized as a lease, and the Objection should be denied, AIG Global asserts. Warren A. Luedecker, Jr., filed a declaration in support of AIG Global's response to the Plan Administrators' Objection to Claim No. 66918. Mr. Luedecker is a Senior Vice President and General Counsel of AIG Global. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. Lehman is set to make its first payment to creditors under its $65 billion payout plan on April 17, 2012. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LEHMAN BROTHERS: Objects to Laurel Cove, Logan Hotels Claims ------------------------------------------------------------ Lehman Brothers Holdings Inc. asked the U.S. Bankruptcy Court in Manhattan to disallow and expunge Claim No. 17763 filed by Laurel Cove Development, LLC, against the company. The real estate developer seeks damages in the sum of $150 million for Lehman's alleged failure to fund the acquisition and development of 1,120 acres of land in Williamson County, Tennessee. In court papers, Lehman argued that it has no liability for the claim since it sold all of its rights and interests in the loan before Laurel Cove asked for funding. The company is also opposing Claim No. 17588 filed by Logan Hotels and Resorts, Mexico, S.A. de c.v. The bankruptcy court will hold a hearing on August 23. Objections are due by August 9. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. Lehman is set to make its first payment to creditors under its $65 billion payout plan on April 17, 2012. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LEVEL 3: Board of Directors Modifies Committees Membership ---------------------------------------------------------- The Board of Directors of Level 3 Communications, Inc., modified the membership of the Audit, Compensation, Nominating and Governance and Strategic Planning committees. Audit Committee John T. Reed (Chairman) Kevin P. Chilton Archie R. Clemins Compensation Committee Michael J. Mahoney (Chairman) Richard R. Jaros Peter Seah Lim Huat Albert C. Yates Nominating and Governance Committee James O. Ellis, Jr. (Chairman) Steven T. Clontz Albert C. Yates Strategic Planning Committee Steven T. Clontz (Chairman) Archie R. Clemins Richard R. Jaros Charles C. Miller, III About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. The Company reported a net loss of $756 million in 2011, a net loss of $622 million in 2010, and a net loss of $618 million in 2009. The Company's balance sheet at March 31, 2012, showed $13.07 billion in total assets, $11.76 billion in total liabilities, and $1.31 billion in total stockholders' equity. * * * Level 3 Communications carries a 'Caa1' corporate family rating, and 'Caa2' probability of default rating, with negative outlook from Moody's, a 'B-' issuer default rating from Fitch, and 'B-' long term issuer credit ratings from Standard & Poor's. As reported by the TCR on April 2, 2012, Fitch Ratings upgraded Level-3 Communications' Issuer Default Rating to 'B' from 'B-' on Oct. 4, 2011, and assigned a Positive Outlook. The rating action followed LVLT's announcement that the company closed on its previously announced agreement to acquire Global Crossing Limited (GLBC) in a tax-free, stock-for-stock transaction. LON MORRIS COLLEGE: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Lon Morris College 800 College Avenue Jacksonville, TX 75766 Bankruptcy Case No.: 12-60557 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Eastern District of Texas (Tyler) Judge: Bill Parker About the Debtor: Lon Morris College was founded in 1854 as a not- for-profit religiously affiliated two-year degree granting institution. Over the past 158 years, the College has impacted the lives of countless members of the local Jacksonville community. The Debtor filed for bankruptcy after seeing a decline of endowments and enrolments to pay teachers, vendors and creditors. Debtor's Counsel: Christopher D. Johnson, Esq. MCKOOL SMITH P.C. 600 Travis Street, Suite 7000 Houston, TX 77002 Tel: (713) 485-7315 Fax: (713) 485-7344 E-mail: cjohnson@mckoolsmith.com - and ? Hugh Massey Ray, III, Esq. MCKOOL SMITH P.C. 600 Travis, Suite 7000 Houston, TX 77002 Tel: (713) 485-7300 Fax: (713) 485-7344 E-mail: hmray@mckoolsmith.com - and ? Timothy Webb, Esq. WEBB AND ASSOCIATES 3401 Louisiana Street, Suite 120 Houston, TX 77002 Tel: (713) 752-0011 Fax: (713) 752-0013 E-mail: timwebblaw@aol.com Debtor's Chief Restructuring Officer: Bridgepoint Consulting LLC's Dawn Ragan Total Assets: $35 million as of April 30, 2012 Total Liabilities: $18 million in funded debt and $2 million in trade and other liabilities as of April 30, 2012 The petition was signed by Dawn Ragan, chief restructuring officer. Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Pioneer College Caterers, Inc. Trade Payable $573,095 303 Glenrose Avenue Nashville, TN 37210 Scurlock Foundation Unsecured Note $250,000 3355 W. Alabama, Suite 630 Houston, TX 77098 General Board of Higher Edu. & Unsecured Loan $250,000 Ministry 1001 Nineteenth Avenue South P.O. Box 340007 Nashville, TN 37203-0007 A-1 Plumbing & Electrical Services Trade Payable $135,490 Reliant Energy Trade Payable $88,362 Follett Virtual Bookstore Trade Payable $86,554 Jenzabar, Inc. Trade Payable $61,643 Tilley, LLC Trade Payable $55,470 Riddell All American Trade Payable $45,393 Tyler Wood Works, Inc. Trade Payable $36,213 Heartspring Methodist Foundation Loan $26,014 First Insurance Funding Corp. Trade Payable $25,582 Taylor Publishing Company Trade Payable $25,383 E. Dale Dotson Wages $25,271 Hawkes Learning Systems Trade Payable $21,469 Visa ? SSB Trade Payable $21,134 Suddenlink Business Trade Payable $20,797 Dell Marketing LP Trade Payable $19,697 Verizon Southwest Trade Payable $18,007 City of Jacksonville Water Dept. Trade Payable $17,871 MAH PROPERTIES: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: MAH Properties, LLC 4501 Cedros Ave., No. 312 Sherman Oaks, CA 91403 Bankruptcy Case No.: 12-16075 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Central District of California (San Fernando Valley) Judge: Alan M. Ahart Debtor's Counsel: Warren N. Nemiroff, Esq. TDG LAW GROUP, APC 9595 Wilshire Blvd #900 Beverly Hills, CA 90212 Tel: (310) 285-1559 Fax: (310) 492-4394 E-mail: wnemiroff@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 A copy of Company's list of its five largest unsecured creditors is available for free at http://bankrupt.com/misc/cacb12-16075.pdf The petition was signed by Marcie Graham, manager. METRO TOWER: Case Summary & 4 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Metro Tower, LLC 500 S. Taylor, Ste 501 Amarillo, TX 79101 Bankruptcy Case No.: 12-20351 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Northern District of Texas (Amarillo) Judge: Robert L. Jones Debtor's Counsel: Patrick Alan Swindell, Esq. SWINDELL & ASSOCIATES, PC 1105 S. Taylor Amarillo, TX 79101 Tel: (806) 374-7979 Fax: (806) 374-1991 E-mail: amacourt@borenswindell.com Scheduled Assets: $1,220,000 Scheduled Liabilities: $733,695 A copy of the Company's list of its four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txnb12-20351.pdf The petition was signed by Todd Harmon, managing member. MICHIGAN FINANCE: Moody's Confirms 'Ca' Rating on 20-B Bonds ------------------------------------------------------------ Moody's Investors Service confirmed two classes of student loan revenue bonds, issued by Michigan Finance Authority, previously known as Michigan Higher Education Student Loan Authority. The underlying collateral consists of a pool of Federal Family Education Loan Program (FFELP) student loans that are guaranteed by the Department of Education for a minimum of 97% of defaulted principal and accrued interest. The complete rating actions are as follows: Issuer: Michigan Higher Education Student Loan Authority (2007 Indenture) Senior Lien Series 20-A Bonds (AMT), Confirmed at B3 (sf); previously on Feb 16, 2012 B3 (sf) Placed Under Review for Possible Downgrade Subordinate Lien Series 20-B Bonds (AMT), Confirmed at Ca (sf); previously on Feb 16, 2012 Ca (sf) Placed Under Review for Possible Downgrade Ratings Rationale The rating confirmations are due to an increase in the transaction's total parity, i.e. the ratio of total assets to total liabilities, which fully offsets a reduction in excess spread relative to Moody's previous estimation. Moody's placed these bonds under review for downgrade on February 16, 2012 as a result of the discovery of an input error that had occurred during the downgrades of the senior and subordinate classes on June 4, 2009 and February 12, 2009, respectively. At the time of the 2009 rating actions, Moody's did not take into account a structural feature that states that in calculating interest rates on the bonds, a multiple applied to an index should increase from 200% to 250% if bonds are rated less than Aaa. After correcting the calculation, the interest rate on the bonds increased, and the excess spread generated by the transaction decreased. The reduction in excess spread was fully offset, however, by a substantial increase in the transaction's total parity, i.e. the ratio of total assets to total liabilities. As a result of a series of bond repurchases at a discount by the issuer, the total parity increased from 98.5% as of June 2009 to 106.4% as of March 2012, the latest reporting date. The principal methodology used in this rating was "Moody's Approach to Rating Securities Backed by FFELP Student Loans", published in April 2012. The performance expectations for a given variable indicate Moody's forward-looking view of the likely range of performance over the medium term. From time to time, Moody's may, if warranted, change these expectations. Performance that falls outside the given range may indicate that the collateral's credit quality is stronger or weaker than Moody's had anticipated when the related securities ratings were issued. Even so, a deviation from the expected range will not necessarily result in a rating action nor does performance within expectations preclude such actions. The decision to take (or not take) a rating action is dependent on an assessment of a range of factors including, but not limited to, the performance metrics. The ratings on both the senior and subordinate bonds would be upgraded if the spread between the 3 month LIBOR index on the liability side and the 1 month LIBOR on the asset side is 10 bps lower, and would be downgraded if the spread is 10 bps higher. To assess rating implications of the higher expected losses, each individual transaction was run through a variety of stress scenarios using the Structured Finance Workstation(R)(SFW), a cash flow model developed by Moody's Wall Street Analytics. MONTECITO AT MIRABEL: Files for Chapter 11 in Phoenix ----------------------------------------------------- Montecito At Mirabel Development, L.L.C., filed a bare-bones Chapter 11 petition (Bankr. D. Ariz. Case No. 12-15110) in Phoenix on July 5, 2012, estimating assets and debts of $10 million to $50 million. A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled for Aug. 7, 2012 at 11:00 a.m. Shelton L. Freeman, Esq., at Deconcini Mcdonald Yetwin & Lacy PC, serves as counsel to the Debtor. A related entity, The Landing at Reid's Ranch Development, LLC, filed a Chapter 11 petition (Case No. 09-33903) on Dec. 31, 2009. MONTGOMERY BANK: Closed; Ameris Bank Assumes All Deposits --------------------------------------------------------- Montgomery Bank & Trust of Ailey, Ga., was closed on Friday, July 6, by the Georgia Department of Banking and Finance, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Ameris Bank of Moultrie, Ga., to assume all of the deposits of Montgomery Bank & Trust. The two branches of Montgomery Bank & Trust will reopen during their normal banking hours as branches of Ameris Bank. Depositors of Montgomery Bank & Trust will automatically become depositors of Ameris Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Montgomery Bank & Trust should continue to use their existing branch until they receive notice from Ameris Bank that it has completed systems changes to allow other Ameris Bank branches to process their accounts as well. As of March 31, 2012, Montgomery Bank & Trust had around $173.6 million in total assets and $164.4 million in total deposits. In addition to assuming all of the deposits of the failed bank, Ameris Bank agreed to purchase around $12.4 million in assets, comprised mainly of cash and cash equivalents. The FDIC will retain the remaining assets for later disposition. Customers with questions about the transaction should call the FDIC toll-free at 1-800-640-2693. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/montgomery.html The FDIC estimates that the cost to the Deposit Insurance Fund will be $75.2 million. Compared to other alternatives, Ameris Bank's acquisition was the least costly resolution for the FDIC's DIF. Montgomery Bank & Trust is the 32nd FDIC-insured institution to fail in the nation this year, and the sixth in Georgia. The last FDIC-insured institution closed in the state was Security Exchange Bank, Marietta, on June 15, 2012. MORGAN'S FOODS: Posts $39,000 Net Income in May 20 Quarter ---------------------------------------------------------- Morgan's Foods, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $39,000 on $20.31 million of revenue for the 12 weeks ended May 20, 2012, compared with a net loss of $217,000 on $19.56 million of revenue for the 12 weeks ended May 22, 2011. The Company's balance sheet at May 20, 2012, showed $53.51 million in total assets, $54.51 million in total liabilities and a $1 million total shareholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/ST30ce About Morgan's Foods Cleveland, Ohio-based Morgan's Foods, Inc., which was formed in 1925, operates through wholly-owned subsidiaries KFC restaurants under franchises from KFC Corporation, Taco Bell restaurants under franchises from Taco Bell Corporation, Pizza Hut Express restaurants under licenses from Pizza Hut Corporation and an A&W restaurant under a license from A&W Restaurants, Inc. As of May 20, 2011, the Company operates 56 KFC restaurants, 5 Taco Bell restaurants, 10 KFC/Taco Bell "2n1's" under franchises from KFC Corporation and franchises from Taco Bell Corporation, 3 Taco Bell/Pizza Hut Express "2n1's" under franchises from Taco Bell Corporation and licenses from Pizza Hut Corporation, 1 KFC/Pizza Hut Express "2n1" under a franchise from KFC Corporation and a license from Pizza Hut Corporation and 1 KFC/A&W "2n1" operated under a franchise from KFC Corporation and a license from A&W Restaurants, Inc. The Company reported a net loss of $1.68 million for the year ended Feb. 26, 2012, compared with a net loss of $988,000 for the year ended Feb. 27, 2011. MOTORS LIQUIDATION: Court OKs Amendment to GUC Trust Agreement -------------------------------------------------------------- The Bankruptcy Court authorized Wilmington Trust Company, solely in its capacity as trust administrator and trustee, and and FTI Consulting, Inc., as trust monitor of the GUC Trust, to execute the amendment to the Amended and Restated Motors Liquidation Company GUC Trust Agreement. The GUC Trust Administrator sought Bankruptcy Court authority to amend the GUC Trust Agreement to extend the required dates for filing the GUC Trust Reports from 30 days following each fiscal quarter end and 45 days following each fiscal year end to 45 days following each fiscal quarter end and 90 days following each fiscal year end. The purpose of the Amendment was to conform the deadlines for the filing of the GUC Trust Reports with the deadlines for the filing of reports on Form 10-Qs and Form 10-Ks as required by the no-action letter granted by the staff of the Securities and Exchange Commission. No party objected to the Motion. A copy of the First Amendment is available for free at: http://is.gd/gAC7TY 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. NEDAK ETHANOL: In Default Under Arbor Bank Loan Agreement --------------------------------------------------------- NEDAK Ethanol, LLC, received a notice of continuing default and a demand for payment from Arbor Bank or "TIF Lender" in response to its receipt of the Company Default Notice. The Lender Notice acknowledged receipt of the Company Default Notice and the defaults referenced therein and alleged additional events of default had occurred relating to the Company's inability to pay its debts as they become due and its inability to make payments due under the TIF Loan Documents and as required under the Tax Escrow Agreement dated Jan. 23, 2012, between the Company and First National Bank of Omaha. NEDAK Ethanol is a party to a Loan Agreement dated June 19, 2007, with Arbor Bank, as amended and supplemented. On June 11, 2012, the Company provided Arbor Bank with written notice of an occurrence of an event of default under the TIF Loan Documents as required under the terms of the TIF Loan Documents. Arbor Bank advised the Company that it intends to exercise its remedies under the TIF Loan Documents and take such action as may be necessary or desirable under the circumstances to protect its interest in the collateral and to enforce the Company's obligations under the TIF Loan Documents. The TIF Lender also specifically reserved all rights, remedies, powers and privileges afforded under the TIF Loan Documents and those available at law. Pursuant to the terms of an Intercreditor Agreement dated Dec. 31, 2011, between AgCountry Farm Credit Services, FLCA, and the TIF Lender, until such time as the Company's obligations under the credit agreement between the Company and the AgCountry have been paid in full and the Senior Lender has no commitment to make further loans to the Company, the TIF Lender may not take any action to collect any indebtedness under the TIF Loan Documents or exercise any remedies against the Company or the collateral in connection with the Company's defaults, including its failure to make monthly payments to the tax escrow account established pursuant to the Tax Escrow Agreement for 165 days from: (i) the date the Senior Lender has accelerated the indebtedness under the credit agreement between the Company and the Senior Lender and is pursuing foreclosure of its liens with respect to the collateral; or (ii) the date of the TIF Payment Default. Under the terms of the Intercreditor Agreement, in the event of the commencement of an insolvency proceeding to which the Company is a party, the TIF Lender will then have the right to accelerate payment of the indebtedness under the TIF Loan Documents and file a proof of claim and otherwise participate in that proceeding. Although the TIF Lender stated that it is willing to negotiate a mutually agreeable solution with the Company and other interested parties, there can be no assurance that the Company and the TIF Lender will arrive at any agreement regarding forbearance, waiver of the Existing Defaults, modifications to the TIF Loan Documents or otherwise reach a satisfactory agreement. About NEDAK Ethanol Atkinson, Neb.-based NEDAK Ethanol, LLC -- http://www.nedakethanol.com/-- operates a 44 million gallon per year ethanol plant in Atkinson, Nebraska, and produces and sells fuel ethanol and distillers grains, a co-product of the ethanol production process. Sales of ethanol and distillers grains began in January 2009. NEDAK Ethanol reported a net loss of $781,940 on $152.11 million of revenue in 2011, compared with a net loss of $2.08 million on $94.77 million of revenue in 2010. The Company's balance sheet at March 31, 2012, showed $73.42 million in total assets, $33.68 million in total liabilities, $10.80 million in preferred units Class B, and $28.93 million in total members' equity. Amends Agreement with AgCountry In February 2007, the Company entered into a master credit agreement with AgCountry Farm Credit Services FCA regarding a senior secured credit facility. As of Dec. 31, 2010, and throughout 2011, the Company was in violation of several loan covenants required under the original credit agreement and therefore, the Company was in default under the credit agreement. However, the Company entered into a forbearance agreement with AgCountry which remained effective until June 30, 2011. This default resulted in all debt under the original credit agreement being classified as current liabilities effective as of Dec. 31, 2010. The loan covenants under the original credit agreement included requirements for minimum working capital of $6,000,000, minimum current ratio of 1.20:1.00, minimum tangible net worth of $41,000,000, minimum owners' equity ratio of 50%, and a minimum fixed charge coverage ratio of 1.25:1.00, and also included restrictions on distributions and capital expenditures. On Dec. 31, 2011, the Company and AgCountry entered into an amended and restated master credit agreement pursuant to which the parties agreed to restructure and re-document the loans and other credit facilities provided by AgCountry. Under the amended agreement, the Company is required to make level monthly principal payments of $356,164 through Feb. 1, 2018. Beginning on Sept. 30, 2012, and the last day of the first, second, and third quarters thereafter, the Senior Lender will make a 100% cash flow sweep of the Company's operating cash balances in excess of $3,600,000 to be applied to the principal balance. In addition, the Company is required to make monthly interest payments at the one month LIBOR plus 5.5%, but not less than 6.0%. The interest rate was 6.0% as of Dec. 31, 2011. In addition to the monthly scheduled payments, the Company made a special principal payment in the amount of $7,105,272 on Dec. 31, 2011. As of Dec. 31, 2011, and 2010, the Company had $26,000,000 and $38,026,321 outstanding on the loan, respectively. N.F.K.A. CORP: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: N.F.K.A. Corp. dba Acappella 1 Hudson Street #A New York, NY 10013 Bankruptcy Case No.: 12-12826 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Edward E. Neiger, Esq. Jonathan S. Bodner, Esq. NEIGER LLP 151 West 46th Street 4th Floor New York, NY 10036 Tel: (212) 267-7342 Fax: (212) 918-3427 E-mail: eneiger@neigerllp.com jbodner@neigerllp.com Estimated Assets: $0 to $50,000 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/nysb12-12826.pdf The petition was signed by Sergio Zherka, president. OCEANSIDE YACHT: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Oceanside Yacht Club Development, Inc. fdba Shores Development, Inc. Morgan Creek Landings, Inc. Oceanfront Resort Development, LLC Radio Island Development Company, LLC Beach Hut Development, LLC Waterfront Lifestyle Properties, LLC Spooners Creek Development Company, LLC Radio Island Enterprises 517 East Fort Macon Road Morehead City, NC 28557 Bankruptcy Case No.: 12-04824 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Eastern District of North Carolina (Wilson) Judge: Stephani W. Humrickhouse About the Debtor: The Debtor owns lots in Atlantic Beach, Pine Knoll Shores, and Morehead City, and condominium units at Morgan Creek Landing and The Shores at Spooners Creek in Morehead City. Debtor's Counsel: Trawick H. Stubbs, Jr., Esq. STUBBS & PERDUE, P.A. P.O. Drawer 1654 New Bern, NC 28563 Tel: (252) 633-2700 Fax: (252) 633-9600 E-mail: efile@stubbsperdue.com Scheduled Assets: $23,979,592 Scheduled Liabilities: $30,227,643 The petition was signed by W. Douglas Brady, secretary. Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Branch Banking & Trust Lots $5,020,550 P.O. Box 1847 Wilson, NC 27894 Olde Towne Dev. Corp. Lots $2,250,000 805 Front Street Beaufort, NC 28516 Shores at Spooners Crk HOA Dues $97,296 P.O. Box 1499 Morehead City, NC 28557 Carteret Co Tax Collector -- $61,175 Morgan Creek Ldg HOA POA dues $38,063 Morgan Creek Ldg HOA Units $27,159 Town of Morehead City -- $23,626 Town of Pine Knoll Shores -- $9,458 RSM McGladrey -- $8,000 Shores at Spooners Crk HOA Unit A-41 $4,853 Town of Atlantic Beach -- $4,489 Shores at Spooners Crk HOA Unit C-22 $4,450 Shores at Spooners Crk HOA Unit C-12 $4,450 Shores at Spooners Crk HOA Unit B-12 $4,450 Shores at Spooners Crk HOA Unit A-43 $4,450 Shores at Spooners Crk HOA Unit A-42 $4,450 Shores at Spooners Crk HOA Unit A-13 $4,450 Shores at Spooners Crk HOA Unit A-12 $4,450 Jonathan Krohn Property $2,047 Wheatly, Wheatly, et al -- $2,000 OPTIMUMBANK HOLDINGS: Amends Stock Purchase Pact with M. Gubin -------------------------------------------------------------- OptimumBank Holdings, Inc., and Moishe Gubin amended a stock purchase agreement to extend the outside closing date by three months, from June 30, 2012, to Sept. 30, 2012, in order to provide Mr. Gubin additional time in which to obtain all necessary regulatory approvals for the purchase of the Shares. OptimumBank entered into an amended and restated stock purchase agreement dated as of Dec. 5, 2011, with Company director and chairman of the board Moishe Gubin, pursuant to which Mr. Gubin has agreed to purchase, subject to certain conditions, for $2.7 million in cash, 6,750,000 newly issued shares of common stock of the Company. Under the terms of the stock purchase agreement, the Company's obligation to issue and sell the Shares to Mr. Gubin is subject to the condition that Gubin will have obtained all regulatory approvals or consents required for him to purchase the Shares, including the consent of the Federal Reserve Board and the Florida Office of Financial Regulation. A copy of the Amended Stock Purchase Agreement is available for free at http://is.gd/weJ18S On June 29, 2012, the Company's Board of Directors appointed a new director, Joel Klein. Mr. Klein has been appointed for a term that will expire at the 2013 annual meeting of the Company's shareholders. Mr. Klein, a part-time resident of Miami Beach, Florida, has served as a director of OptimumBank, the Company's subsidiary bank, since March 2012. Mr. Klein has over 40 years of combined experience as a certified public accountant, controller, chief financial officer, and manager in the public accounting, equipment lease financing, investment banking, and taxi service industries. Mr. Klein recently retired from Taxi Affiliation Services, LLC, a taxi service company, where he served as Chief Financial Officer from 2005 to 2010. From 1994 to 2005 he served as Vice President of the Stamford Capital Group, Inc., an investment banking firm. He served as President of The Leasing Equipment Group, Ltd., from 1978 to 1989 and as Vice President of Equilease Corporation from 1991 to 1994, entities engaged in equipment lease financing. He was engaged in public accounting from 1969 to 1975, serving as a staff accountant at Brout, Isaacs & Co., CPAs, and senior accountant at Goldstein, Golub, Kessler & Co., CPAs. Mr. Klein received his B.S. in Accounting from Brooklyn College and is licensed as a certified public accountant in the State of New York (currently inactive). Mr. Klein is expected to be named to the Company's compensation and audit committees. The appointment of Mr. Klein as a director was not pursuant to any arrangement or understanding between Mr. Klein and any third party. Mr. Klein is entitled to be compensated for his services on the Company's Board in accordance with the Company's compensation arrangements for non-employee directors under the Company's 2011 Equity Incentive Plan and the Company's Non-Employee Director Compensation Plan. Under the Director Compensation Plan, which became effective on Jan. 1, 2012, fees for attendance at Board and committee meetings are payable 75% in common shares of the Company valued at the fair market value on the date of issuance and 25% in cash, at the end of each calendar quarter, in the following amounts: * A fee of $1,000 for each regularly scheduled Board meeting attended during the quarter; * A fee of $200 to each audit committee member, and $250 to the audit committee chair, for each audit committee meeting attended during the quarter; and * A fee of $100 to each compensation committee member, and $125 to the compensation committee chair, for each compensation committee meeting attended during the quarter. Since the boards of the Company and OptimumBank generally meet on the same day for their regularly scheduled monthly meetings, no additional meeting fees are paid to OptimumBank directors who are also Company directors for attendance at OptimumBank board meetings. No meeting fees are paid for attendance at special Board meetings. 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. PLAZA LATINA: Case Summary & 7 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Plaza Latina, LLC 1379 Park Western, Apartment 254 San Pedro, CA 90732 Bankruptcy Case No.: 12-34319 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Stacey G. Jernigan Debtor's Counsel: Eric A. Liepins, Esq. ERIC A. LIEPINS, P.C. 12770 Coit Road, Suite 1100 Dallas, TX 75251 Tel: (972) 991-5591 E-mail: eric@ealpc.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 seven largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txnb12-34319.pdf The petition was signed by Ki sang Kim, sole member. QUALITY DISTRIBUTION: To Issue 2MM Shares Under Incentive Plan -------------------------------------------------------------- Quality Distribution, Inc., filed with the U.S. Securities and Exchange Commission a Form S-8 registering 2 million shares of common stock issuable under the Company's 2012 Equity Incentive Plan. The proposed maximum aggregate offering price is $20.34 million. A copy of the filing is available for free at: http://is.gd/mBmVdv About Quality Distribution Quality Distribution, LLC, and its parent holding company, Quality Distribution, Inc., are headquartered in Tampa, Florida. The company is a transporter of bulk liquid and dry bulk chemicals. The company's 2010 revenues are approximately $686 million. Apollo Management, L.P., owns roughly 30% of the common stock of Quality Distribution, Inc. The Company reported net income of $23.43 million in 2011, compared with a net loss of $7.40 million in 2010. The Company's balance sheet at March 31, 2012, showed $330.79 million in total assets, $398.38 million in total liabilities and a $67.58 million total shareholders' deficit. Bankruptcy Warning In its Form 10-K for 2011, the Company noted that it had consolidated indebtedness and capital lease obligations, including current maturities, of $307.1 million as of Dec. 31, 2011. The Company must make regular payments under the New ABL Facility and its capital leases and semi-annual interest payments under its 2018 Notes. The New ABL Facility matures August 2016. However, the maturity date of the New ABL Facility may be accelerated if the Company defaults on its obligations. If the maturity of the New ABL Facility or such other debt is accelerated, the Company does not believe that it will have sufficient cash on hand to repay the New ABL Facility or such other debt or, unless conditions in the credit markets improve significantly, that the Company will be able to refinance the New ABL Facility or such other debt on acceptable terms, or at all. The failure to repay or refinance the New ABL Facility or such other debt at maturity will have a material adverse effect on the Company's business and financial condition, would cause substantial liquidity problems and may result in the bankruptcy of the Company or its subsidiaries. Any actual or potential bankruptcy or liquidity crisis may materially harm the Company's relationships with its customers, suppliers and independent affiliates. RALPH ROBERTS: Court Wants Amendment to Plan Outline ---------------------------------------------------- Ralph Roberts Realty LLC and Ralph R. Roberts were required last week to file an amended disclosure statement explaining their chapter 11 reorganization plan. Bankruptcy Judge Thomas J. Tucker, which signed the order on June 29, said the Court cannot yet grant preliminary approval of the disclosure statement because of problems that the Debtors must correct. The Debtors filed a First Amended Combined Plan of Reorganization and Disclosure Statement on June 13. The Court required them to file the amended disclosure statement and a redlined copy of the plan outline by July 2. Among other things, the Court noted that the Disclosure Statement indicated "Mr. Roberts is owed approximately $1,000,000 by Realty on account of past unpaid commissions and loans made to Realty," and in a later section indicated "[p]re-petition, . . . Mr. Roberts, although entitled to one-half of the commissions on properties sold by Realty, has not been paid these commissions since 2007. The total accrued but unpaid amounts equal approximately $1.35 million." According to the Court, the Debtors must classify and explicitly treat the pre-petition claims that the Debtor Ralph Roberts has against the Debtor Ralph Roberts Realty even if such claims are to be paid nothing. If the Debtors intend that the prepetition claims of Ralph Roberts against the Debtor Ralph Roberts Realty are to be included in, and paid pro rata with, the general unsecured claims in Class 8 of the Plan (which seems unlikely,) then Debtors must say this explicitly in the Plan and Disclosure Statement. A copy of the Court's June 29, 2012 Order is available at http://is.gd/v8a6HHfrom Leagle.com. About Ralph Roberts Ralph Roberts and his namesake firm, Ralph Roberts Realty LLC, in Sterling Heights, Michigan, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 12-53023) on May 25, 2012. Ralph Roberts is a Clinton Township realtor who owns the giant nail from the iconic Uniroyal tire near Detroit Metropolitan Airport. According to Detroit News, the bankruptcy filing followed years of disputes with real estate investors and fallout from a 2004 indictment stemming from the federal probe of Macomb County Prosecutor Carl Marlinga. Judge Thomas J. Tucker presides over the case. Hannah Mufson McCollum, Esq., and John C. Lange, Esq., at Gold, Lange & Majoros, PC, serve as the Debtors' counsel. Mr. Roberts listed more than $1.86 million in assets and $73.2 million in liabilities in his own Chapter 11 petition. The real estate firm scheduled assets of $1,520,232 and liabilities of $108,381. RANDI'S INC: Court Denies Approval of Chapter 11 Plan ----------------------------------------------------- Randi's, Inc. sole shareholder Randi Beckworth, has failed to obtain from the Hon. Susan D. Barrett of the U.S. Bankruptcy Court for the Southern District of Georgia confirmation of the small business Chapter 11 plan filed for the Debtor. On Jan. 4, 2012, the U.S. Trustee sought to have the Debtor's case dismissed or converted to Chapter 7, alleging that the Debtor failed to file a plan and disclosure statement within 300 days of the date of the order for relief and failed to request an extension to do so. On Feb. 16, 2012, about 351 days after the date of the order for relief, the Debtor filed a plan and disclosure statement and a motion to extend time to confirm the plan. The plan proposes to pay claims in full. After the plan was filed, the U.S. Trustee filed a withdrawal of motion to dismiss or convert. On March 15, 2012, because the U.S. Trustee's motion had been withdrawn, a hearing on the motion to extend time to confirm plan was held. The time for confirmation was extended, but the Debtor reserved ruling on whether the failure to file a plan within 300 days of the order for relief or obtain an extension made any plan statutorily unconfirmable. On June 27, 2012, the Court ruled that the plan is unconfirmable. The Court has also dismissed the Debtor's bankruptcy case. Louisville, Georgia-based Randi's, Inc., is a small business debtor, which filed for Chapter 11 bankruptcy protection (Bankr. S.D. Ga. Case No. 11-10431) on March 2, 2011. The Debtor disclosed less than $100,000 assets and debts. RESIDENTIAL CAPITAL: Files Schedules of Assets & Liabilities ------------------------------------------------------------ Residential Capital, LLC, disclosed in its schedules of assets and liabilities that it has $3,533,754,425 in assets consisting of personal property, and $6,524,387,253 in liabilities composed of $3,565,843,076 owed to creditors holding secured claims and $2,958,544,176 owed to creditors holding unsecured non-priority claims. Full-text copies of ResCap's Schedules are available for free at: http://bankrupt.com/misc/rescap_july2sal.pdf ResCap also disclosed in its statement of financial affairs that it obtained income from operation of its business for the two- year period preceding the Petition Date: Income from Net Revenue Continuing Operations Time Period ----------- --------------------- ----------- $39,713,645 $5,643,305 01/01/12-05/13/12 ($814,390,475) ($819,903,707) Year 2011 $308,084,599 $331,503,711 Year 2010 For the two-year period preceding the Petition Date, ResCap also obtained income other than from the operation of its business: Income from Income Tax Discontinued Operations Time Period ---------- ----------------------- ----------- $25,767,627 $0 01/01/12-05/13/12 $190,592,467 $52,987,702 Year 2010 ($25,158,943) $0 Year 2011 A full-text copy of ResCap's Statement is available for free at: http://bankrupt.com/misc/rescap_july2sofa.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: GMAC Mortgage Files Schedules -------------------------------------------------- GMAC Mortgage, LLC, disclosed in its schedules of assets and liabilities that it has $4,350,456,825 in assets consisting of $9,749,356 of real property and $4,340,707,468 in personal property; and $2,584,915,399 in liabilities composed of $1,343,254,081 owed to creditors holding secured claims, $1,028,973 owed to creditors holding unsecured priority claims, and $1,240,632,345 owed to creditors holding unsecured non- priority claims. Full-text copies of GMAC Mortgage's Schedules are available for free at http://bankrupt.com/misc/gmac_july2sal.pdf GMAC Mortgage disclosed in its statement of assets and liabilities that for the two-year period preceding the Petition Date it gained income from the operation of its business: Income from Net Revenue Continuing Operations Time Period ----------- --------------------- ----------- $556,951,740 $62,034,393 01/01/12-05/13/12 $589,437,905 ($521,490,535) Year 2011 $1,498,420,891 $86,299,989 Year 2010 For the same two-year period preceding the Petition Date, GMAC Mortgage also gained income other than from the operation of its business: Income from Income Tax Discontinued Operations Time Period ---------- ----------------------- ----------- ($7,261,771) $0 01/01/12-05/13/12 ($9,351,256) $0 Year 2010 ($6,039,439) $0 Year 2011 A full-text copy of GMAC Mortgage's Statement is available for free at http://bankrupt.com/misc/gmac_july2sofa.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). RIVER GLIDER: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: River Glider Trust c/o Resources Group LLC 900 Las Vegas Blvd S. #810 Las Vegas, NV 89107 Bankruptcy Case No.: 12-17862 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce T. Beesley 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: $1,015,000 Scheduled Liabilities: $2,361,235 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/nvb12-17862.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 Cape Jasmine Court Trust 12-17498 06/26/12 Villa Vecchio Court Trust 12-15254 05/02/12 RIVIERA HOLDINGS: Moodys Cuts CFR to 'Caa2'; Outlook Negative ------------------------------------------------------------- Moody's Investors Service downgraded Riviera Holdings Corporation's Corporate Family and Probability of Default ratings to Caa2 from Caa1, and its Series A term loan and revolver to Caa1 from B3. The company's Series B term loan was confirmed at Caa3. Riviera's SGL-3 Speculative Grade Liquidity rating remains unchanged. The rating outlook is negative. This rating action concludes the review that was initiated on April 23, 2012. The downgrade of Riviera's Corporate Family Rating to Caa2 reflects heightened concern on Moody's part regarding Rivera's ability to achieve profitability over the next few years given that Riviera Las Vegas, the company's only asset, generates negative EBITDA. Riviera Las Vegas reported negative $1.4 million EBITDA in the first quarter 2012 versus break even results during the same prior year period, and Moody's expects this property will continue to be challenged given its location at the north end of the Las Vegas Strip. Casinos located on the northern end of the Las Vegas Strip, like Riviera Las Vegas, have struggled due to low foot traffic. And while the Las Vegas Strip's recovery is gaining traction, primarily through improved hotel occupancy, Riviera Las Vegas' EBITDA has not yet benefited from these trends. While Riviera's cash balance, pro forma for the sale of Riviera Black Hawk that occurred in April 2012, is approximately $90 million, more than its outstanding debt, the company will have to rely on this cash to cover its debt service and maintenance capital expenditures given that its casino asset is not profitable on an EBITDA basis. Even though Moody's believes Riviera will use a portion of the proceeds from the sale of the Riviera Black Hawk to pay down debt, the company will still be reliant upon a turnaround at the Riviera Las Vegas for improvement in earnings and future debt reduction. The negative rating outlook considers Riviera's risk of non- compliance with its leverage and coverage covenants for the period ended June 30, 2012. Ratings could be downgraded if Riviera does not receive a waiver or amendment of its financial covenants. The rating outlook could return to stable if the company successfully negotiates covenant relief and determines the final use of proceeds of the sale of Black Hawk Riviera. A higher rating would require a return to profitability to a level that could support debt service and maintenance capital expenditure requirements. Independent of any change in Rivera's Corporate Family Rating, the ratings on the company's Series A term loan and revolver or Series B term loan could change depending on the amount of debt the company ultimately repays with the proceeds from the sale of the Black Hawk casino. Ratings downgraded: Corporate Family Rating to Caa2 from Caa1 Probability of Default Rating to Caa2 from Caa1 First lien Series A $10 million revolver due April 2016 to Caa1 (LGD 3, 34%) from B3 (LGD 3, 35%) First lien Series A $50 million term loan due April 2016 to Caa1 (LGD 3, 34%) from B3 (LGD 3, 35%) Rating confirmed : Second Lien Series B (PIK) $23 million term loan due April 2016 at Caa3 (LGD 5, 84% from 85%) Ratings Rationale In addition to Riviera's lack of profitability, the Caa2 Corporate Family Rating considers the company's small size in terms of annual revenue -- less than $100 million -- and lack of diversification which makes it more vulnerable to regional economic swings, market conditions, and earnings compression resulting from promotional activity. Positive rating consideration is given to Riviera's relatively large pro forma cash balance. The principal methodology used in rating Riviera Holdings Corporation was the Global Gaming Industry Methodology published in December 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. Riviera Holdings Corporation owns and operates the Riviera Hotel and Casino in Las Vegas and the Riviera Black Hawk casino in Colorado. The company generates approximately $80 million in net revenues annually. ROTECH HEALTHCARE: Carter to Retire as President & CEO Dec. 31 -------------------------------------------------------------- Philip L. Carter has notified Rotech Healthcare Inc. of his intention to retire as President and Chief Executive Officer on Dec.31, 2012. Mr. Carter provided this notice pursuant to his amended employment agreement. As previously reported, the Company amended Mr. Carter's employment agreement in August of 2011 specifically in contemplation of Mr. Carter's future retirement and to provide for an orderly succession plan. Mr. Carter will remain on the Company's Board of Directors after his retirement as President and CEO. The Board of Directors intends to initiate a search process to select the Company's next President and Chief Executive Officer and to engage an executive search firm to assist in the process of evaluating external and internal candidates. "On behalf of the Board and the entire Company, I would like to thank Phil for his extraordinary leadership over these past ten years," said Arthur J. Reimers, Chairman of the Board of Directors. "The Company's operations are well positioned for the future, and the Company has a strong management team in place. Based on the transition plan the Company implemented last year with the amendment of Phil's agreement, the Company believes we now have ample lead time for an orderly transition to conduct a thorough and thoughtful search to identify and appoint a successor." About Rotech Healthcare Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI) -- http://www.rotech.com/-- provides home medical equipment and related products and services in the United States, with a comprehensive offering of respiratory therapy and durable home medical equipment and related services. The company provides equipment and services in 48 states through approximately 500 operating centers located primarily in non-urban markets. The Company reported a net loss of $14.76 million in 2011, a net loss of $4.20 million in 2010, and a net loss of $21.08 million in 2009. The Company's balance sheet at March 31, 2012, showed $267.15 million in total assets, $584.24 million in total liabilities, $3.08 million in series A convertible redeemable preferred stock, and a $320.17 million total stockholders' deficiency. * * * As reported by the TCR on May 25, 2012, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating and related issue-level ratings on the company. "The ratings reflect Rotech's 'highly leveraged' financial risk profile, including its negative cash flow and overall sensitivity of credit metrics to the uncertain reimbursement environment. Rotech's 'weak' business risk profile primarily reflects its narrow operating focus and exposure to continued Medicare reimbursement reductions for its products and services, particularly for its nebulizer medication," S&P said. In the Jan. 13, 2012, edition of the TCR, Moody's Investors Service lowered Rotech Healthcare Inc.'s Corporate Family rating ("CFR") to B3 from B2 as a consequence of weakening liquidity and worse than expected operating performance in 2011 alongside only modest expectations for improvement in 2012. The downgrade to B3 incorporates Moody's concerns regarding the decline in Rotech's cash balance due to significant working capital usage during 2011 and lower than expected growth in EBITDA. SAFENET INC: Cancelled Dividend No Impact on Moody's 'B2' CFR ------------------------------------------------------------- Moody's Investors Service says SafeNet, Inc.'s B2 corporate family rating and stable ratings outlook remain unchanged after the company cancelled its previously proposed $175 million of dividend and amendment to credit agreement to effect extension of maturities. SafeNet's ratings are as follows: Issuer: SafeNet, Inc. Corporate Family Rating -- B2 Probability of Default Rating -- B2 $25 million First lien secured revolving credit facility due April 2013 -- B1, LGD3 (32%), changed from 36% $221 million (originally $250 million) First lien secured term loan facility due April 2014 -- B1, LGD3 (32%), changed from 36% $131 million Second lien secured term loan facility due April 2015 -- Caa1, LGD 5 (81%), changed from 87% Outlook is Stable. The principal methodology used in rating SafeNet was the Global Software 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. Headquartered in Belcamp, MD, SafeNet provides data security solutions to government and enterprise customers. The company was taken private by Vector Capital in 2007 and it reported $445 million in revenue in the trailing twelve months ended on March 31, 2012. SANKO STEAMSHIP: Chapter 15 Case Summary ---------------------------------------- Chapter 15 Petitioner: Hisashi Asafuji Chapter 15 Debtor: The Sanko Steamship Co., Ltd. 2-3, Uchisaiwaicho 2-Chrome Chiyoda-ku, Tokyo Chapter 15 Case No.: 12-12815 Type of Business: Sanko Steamship owns and operates 156 vessels. The Debtor is one of Japan's oldest shipping Companies that provides marine transportation, brokerage and agency, sales and purchase of vessels and consultation on marine technology. Sanko commenced proceedings under the Corporate Reorganization Act of Japan before the Tokyo District Court, Civil Department No. 8 amid declining demand and creditor actions. Sanko is asking the Manhattan judge to recognize the Japanese proceeding as a "foreign main proceeding" under Section 1517 of the Bankruptcy Code. Chapter 15 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Judge: James M. Peck Debtor's Counsel: Daniel J. Guyder, Esq. ALLEN & OVERY LLP 1221 Avenue of the Americas New York, NY 10020 Tel: (212) 610-6300 Fax: (212) 610-6399 E-mail: daniel.guyder@allenovery.com Estimated Assets: $500,000,001 to $1 billion Estimated Debts: $500,000,001 to $1 billion SANTA YSABEL: Has Green Light to Pay Wages & Other Bills -------------------------------------------------------- Katy Stech, writing for Dow Jones Newswires, reports that Chief Judge Peter W. Bowie has given Santa Ysabel Resort and Casino permission to continue paying its employees and other bills throughout the bankruptcy case. Dow Jones relates Santa Ysabel Resort sought bankruptcy protection as it faces threats of foreclosure from the Yavapai Apache Nation, which had lent the casino's owners more than $9 million. The casino -- which is owned by the Iipay Nation of Santa Ysabel -- will continue operating as it seeks to restructure its debt. According to the report, a tribal court that governs federally recognized tribes granted the Yavapai Apache Nation a judgment for more than $9 million in February. Executives at Santa Ysabel said in court papers this week the Yavapai Apache Nation's move to collect on the judgment would cause it to shut down, putting its 120 employees out of work. A spokeswoman for the Yavapai Apache Nation couldn't immediately be reached, Dow Jones says. Santa Ysabel Resort & Casino -- http://www.santaysabelcasino.com/ --- is a casino located on the Santa Ysabel Indian Reservation in Santa Ysabel, California. The casino has 349 slot machines and six gaming tables as well as live poker and live blackjack. It is also in close proximity to Lake Henshaw, Julian and Warner Springs. The Santa Ysabel tribal Chairman is Virgil Perez. According to Dow Jones Newswires, the casino was initially designed to have a resort and hotel, but its owners had to forgo construction of the hotel when money became tight. The casino opened in 2007 just as the Southern California real-estate market took a hit and the nation's economy went into a tailspin. More bad news arrived when wildfires shut down the casino for a week, and the owners didn't provide enough funding to advertise the operations, according to court papers. The facility was built with a $26 million loan from J.P. Morgan Chase and $7 million from Yavapai Apache Nation. The Yavapai Apache Nation later took over J.P. Morgan's debt related to the project, Dow Jones reports, citing court papers. The casino also has $1.3 million in unsecured trade debt. According to Dow Jones, the casino said if it is forced to shut down, an auction of most of its property would bring in about $250,000. Gambling company IGT has the first lien on its machines. Attorneys for the casino said it hasn't been able to make the monthly $50,000 payment it promised to the county for law enforcement and other services. The Iipay Nation of Santa Ysabel, a federally recognized Indian Tribe, filed a resolution authorizing the Chapter 11 bankruptcy filing of Santa Ysabel Resort and Casino (Bankr. S.D. Calif. Case No. 12-09415) in San Diego on July 2, 2012. The Debtor estimated assets of up to $50 million and liabilities of up to $100 million. Ron Bender, Esq., at Levene, Neale, Bender, Yoo & Brill LLP, in Los Angeles, serves as counsel. Virgil Perez signed the Chapter 11 petition. SANTA YSABEL: Case Summary & 18 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Santa Ysabel Resort and Casino 25575 Highway 79 Santa Ysabel, CA 92070-0000 Bankruptcy Case No.: 12-09415 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Southern District of California (San Diego) Judge: Peter W. Bowie About the Debtor: Santa Ysabel Resort & Casino -- http://www.santaysabelcasino.com/-- is a casino located on the Santa Ysabel Indian Reservation in Santa Ysabel, California. The casino has 349 slot machines and six gaming tables as well as live poker and live blackjack. It is also in close proximity to Lake Henshaw, Julian and Warner Springs. The Santa Ysabel tribal Chairman is Virgil Perez. Debtor's Counsel: Ron Bender, Esq. LEVENE, NEALE, BENDER, YOO & BRILL LLP 10250 Constellation Boulevard, Suite 1700 Los Angeles, CA 90067 Tel: (310) 229-1234 Fax: (310) 229-1244 E-mail: rb@lnbyb.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $50,000,001 to $100,000,000 The petition was signed by Virgil Perez, chairman. Debtor's List of Its 18 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ County of San Diego (MOU) -- $3,041,939 1600 Pacific Coast Highway, Suite 212 San Diego, CA 92101 Native American Megajackpots -- $506,933 Department # 72714 Los Angeles, CA 90084-2714 Internation Gaming Technology -- $247,187 (Participation Fees) Department 7866 Los Angeles, CA 90088-7866 Aristocrat -- $102,603 CBS Outdoor -- $101,745 State of California -- $100,633 Global Power Group, Inc. -- $42,860 Global Industry Products, Corp. -- $40,860 J. Michael Caballero -- $26,250 Cox Media -- $20,920 John Farkash -- $8,910 Cintas Corporation -- $5,221 Midwest Television, Inc. -- $3,963 Global Cash Access, Inc. -- $3,607 Wells Fargo Banks -- $2,196 McGladrey & Pullen -- $2,000 Lloyd Pest Control -- $1,200 Gaming Guide -- $1,200 SDA INC: Strauss Auto Closes Stores, to File Liquidating Plan ------------------------------------------------------------- Stephanie Gleason at The Wall Street that Strauss Auto is planning to file a plan of liquidation. WSJ relates that Strauss Auto has closed down its 46 remaining stores and plans to sell its assets. Citing Edward Altman, a bankruptcy expert and New York University finance professor who tracks repeat bankruptcy filings, WSJ states that the continuity of its management may be partly to blame why Strauss Auto has kept winding up in Chapter 11. "If you're at the helm when your firm went bankrupt, it is very unlikely that you're going to be able to turn it around," the report quoted Mr. Altman as saying. Glenn Langberg, who left his chief executive post at Strauss Auto in 2011, said that isn't a fair assessment, given his work reviving the company after its 1998 and 2009 bankruptcies, WSJ relates. Mr. Langberg, according to WSJ, pointed to the years between 2007 and 2009, when he wasn't in charge, saying, "I think those gaps are important. There have been a lot of different owners of the company, a lot of different hands have touched it." About Strauss Discount Auto 155 Route 10 Associates, Inc., SDA, Inc., and Wayne Philadelphia Associates, Inc., sought Chapter 11 protection (Bankr. D.N.J. Case Nos. 12-24414 to 12-24416) on June 5, 2012, in Newark, New Jersey. SDA is a regional retailer of after-market automotive parts and accessories and operator of automotive service centers and owns commercial real estate located in Wayne, New Jersey. Subsidiaries Route 10 Associates and Wayne Philadelphia own commercial real estate located in East Hanover and Wayne, respectively. The Debtors ceased operations before its filed for bankruptcy in June 5, 2012. This is the fourth bankruptcy filing by the Strauss Discount Auto business. SDA's capital structure, for the most part, was formed in late 2010 when SDA's predecessor, Autobacs Strauss, Inc., reorganized under Chapter 11 (Bankr. D. Del. Case No. 09-10358). Autobacs Strauss Inc.'s plan of reorganization was confirmed on Sept. 15, 2010, and became effective on Oct. 6, 2010. Strauss had 111 stores in 1998, when it first filed for bankruptcy. Bankruptcy Judge Novalyn L. Winfield presides over the 2012 bankruptcy. Kenneth Rosen, Esq., at Lowenstein Sandler PC, serves as the Debtors' counsel. PricewaterhouseCoopers LLP serves as financial advisors. SDA estimated $10 million to $50 million in both assets and debts. The petitions were signed by Joseph Catalano, president. SEARS HOLDINGS: Edward Lampert Discloses 61.8% Equity Stake ----------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Edward S. Lampert and his affiliates disclosed that, as of June 30, 2012, they beneficially own 65,744,084 shares of common stock of Sears Holdings Corporation representing 61.8% of the shares outstanding. A copy of the filing is available for free at http://is.gd/sgqrem About Sears Hoffman Estates, Illinois-based Sears Holdings Corporation (Nasdaq: SHLD) -- http://www.searsholdings.com/-- is the nation's fourth largest broadline retailer with more than 4,000 full-line and specialty retail stores in the United States and Canada. Sears Holdings operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a 94% stake in Sears Canada and an 80.1% stake in Orchard Supply Hardware. Key proprietary brands include Kenmore, Craftsman and DieHard, and a broad apparel offering, including such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer, as well as the Apostrophe and Covington brands. It also has the Country Living collection, which is offered by Sears and Kmart. Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6, 2003, pursuant to the terms of an Amended Joint Plan of Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represented the retailer in its restructuring efforts. The Company's balance sheet showed $16,287,000,000 in assets and $10,348,000,000 in debts when it sought chapter 11 protection. Kmart bought Sears, Roebuck & Co., for $11 billion to create the third-largest U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in annual revenues. Kmart completed its merger with Sears on March 24, 2005. The Company's balance sheet at April 28, 2012, showed $21.60 billion in total assets, $17.02 billion in total liabilities and $4.57 billion in total equity. Negative Outlook Standard & Poor's Ratings Services in January 2012 lowered its corporate credit rating on Hoffman Estates, Ill.-based Sears Holdings Corp. to 'CCC+' from 'B'. "We removed the rating from CreditWatch, where we had placed it with negative implications on Dec. 28, 2011. We are also lowering the short-term and commercial paper rating to 'C' from 'B-2'. The rating outlook is negative," S&P said. "The corporate credit rating reflects our projection that Sears' EBITDA will be negative in 2012, given our expectations for continued sales and margin pressure," said Standard & Poor's credit analyst Ana Lai. She added, "We further expect that liquidity could be constrained in 2013 absent a turnaround or substantial asset sales to fund operating losses." Moody's Investors Service in January 2012 lowered Sears Holdings Family and Probability of Default Ratings to B3 from B1. The outlook remains negative. At the same time Moody's affirmed Sears' Speculative Grade Liquidity Rating at SGL-2. The rating action reflects Moody's expectations that Sears will report a significant operating loss in fiscal 2011. Moody's added that the rating action also reflects the company's persistent negative trends in sales, which continue to significantly underperform peers. SHANTA CORP: Required to File Amendment to Plan Outline July 6 -------------------------------------------------------------- Shanta Corp., d/b/a St. Anne's Convalescent Center, and its debtor-affiliates are required to file by July 6, an amendment to the disclosure statement explaining their plan of reorganization. On June 21, the Debtors filed a Combined Plan of Reorganization and Disclosure Statement. On June 29, Bankruptcy Judge Thomas J. Tucker said the Court cannot yet grant preliminary approval of the disclosure statement as it contains problems that the Debtors must correct. A copy of the Court's June 29, 2012 Order is available at http://is.gd/UewYgffrom Leagle.com. Shanta Corp., d/b/a St. Anne's Convalescent Center, and its affiliates filed for Chapter 11 protection (Bankr. E.D. Mich. Case No. 12-43956) on Feb. 22, 2012. The affiliates are Cadillac Nursing Home, Inc. d/b/a St. Francis Nursing Center (Bankr. Case. No. 12-43957) and St. Jude Nursing Center, Inc. (Bankr. Case. No. 12-43959). The cases are jointly administered. Judge Thomas J. Tucker presides over the cased. Brendan G. Best, Esq., and Michael E. Baum, Esq., at Schafer and Weiner, PLLC, serve as the Debtors' counsel. In its chapter 11 petition, Shanta Corp. estimated $1 million to $10 million in assets and debts. The petition was signed by Bradley Mali, president. SHILLING PIPE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Shilling Pipe & Steel, Inc. dba Shilling Brothers Pipe - Ft. Worth Shilling Pipe Wholesale, Inc. Shilling Brothers Pipe - Waco P.O. Box 763 Elm Mott, TX 76640 Bankruptcy Case No.: 12-60732 Chapter 11 Petition Date: July 2, 2012 Court: U.S. Bankruptcy Court Western District of Texas (Waco) Judge: Craig A. Gargotta Debtor's Counsel: David C. Alford, Esq. PAKIS, GIOTES, PAGE & BURLESON 400 Austin Avenue, Suite 400 P.O. Box 58 Waco, TX 76703-0058 Tel: (254) 297-7300 Fax: (254) 297-7301 E-mail: alford@pakislaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 20 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/txwb12-60732.pdf The petition was signed by Tommy D. Shilling, president. SKINNY NUTRITIONAL: J. Arsenault Succeeds D. McDonald as CFO ------------------------------------------------------------ Skinny Nutritional Corp. executed a separation agreement with Donald J. McDonald, its former chief financial officer, on June 28, 2012. Mr. McDonald also agreed to resign as a member of the Board effective with the cessation of his employment. The Separation Agreement provides that Mr. McDonald will receive the following in addition to his accrued compensation payable through the termination of his service: * A severance payment equal to his base compensation of $240,000 per annum, payable in equal installments on each of the Company's regular pay dates during the period commencing' on the first regular executive pay date following his termination and continuing to Aug. 16, 2014; * The Company, in its absolute discretion, may elect to pay up to $100,000 per annum of the Severance Payment in shares of the Company's Common Stock, issued as of each of the regular pay dates, at a value based on the fair market value of the Company's Common Stock on the issue date; * The Company will issue 2,000,000 shares of the Company's Common Stock to and agreed that all unvested restricted stock awards held by him as of the termination of his employment, which is 1,000,000 shares, shall be deemed vested; * Coverage for COBRA benefits to the maximum amount permitted by law, in accordance with, and subject to, the terms and conditions of his employment agreement; and * Reimbursement for reasonable legal fees and costs of negotiating the Separation Agreement and payment of an amount equal to $24,000 for unused vacation time. In addition, in the Separation Agreement, Mr. McDonald agreed to vote his shares of Common Stock in favor of the Company's transactions with Trim Capital, LLC. Effective as of June 28, 2012, the Company appointed James Arsenault as its interim Chief Financial Officer, treasurer and principal accounting officer effective immediately. There are no family relationships between Mr. Arsenault and any director, executive officer, or any person nominated or chosen by the Company to become a director or executive officer. Purchase Agreement On June 28, 2012, Skinny Nutritional and Trim Capital entered into a Securities Purchase Agreement relating to a financing transaction for a maximum of $15,000,000 in total proceeds to the Company. At the first closing, which was completed on June 28, 2012, the Company sold a $1,000,000 senior secured bridge note to the Purchaser. Pursuant to the terms of the Purchase Agreement entered into in the Unit Financing, the Company agreed to seek stockholder approval for the purpose of, among other things, adopting the Amended and Restated Charter in order to, without limitation, authorize: (a) a sufficient number shares of Common Stock for issuance in the Unit Financing, upon conversion of the Junior Preferred, and pursuant to a new equity compensation plan, and other corporate purposes, (b) a reverse split of the Common Stock in a ratio to be agreed upon in accordance with Nevada law, (c) the Junior Preferred, and (d) provide for the indemnification of directors. New Lease On June 29, 2012, the Company entered into a new one year lease with Kalmon Dolgin Affiliates, Inc., as landlord, to commence on July 1, 2012, for approximately 1,523 square feet of office space located at Spring Mill Corporate Center, 1100 East Hector Street, Suite 391, Conshohocken, PA 19428. The total annual rent due under the lease is approximately $34,267, plus any additional rent, as may be provided for in the lease agreement. The Company will use the space for its headquarters and the Company believes that the amount of space is sufficient for such needs for the foreseeable future. Amendments to Other Notes In connection with the Unit Financing, the Company entered into agreements with United Capital Funding Corp. and Michael Salaman, its Chief Executive Officer, to amend the promissory notes issued to them on June 7, 2012 in the principal amounts of $300,000 and $50,000, respectively. Pursuant to these amendment agreements, each note holder agreed that the term of the note be extended to be equal to the earlier of (i) 90 days from the issue date or (ii) the date of the second closing of the Unit Financing. In addition, Mr. Salaman agreed to subordinate his note to the obligations of the Company under the notes issued in the Unit Financing. A copy of the Form 8-K is available for free at: http://is.gd/Oe5qIX About Skinny Nutritional Bala Cynwyd, Pa.-based Skinny Nutritional Corp. (OTC BB: SKNY.OB) -- http://www.SkinnyWater.com/-- has developed and is marketing a line of enhanced waters, all branded with the name "Skinny Water" that are marketed and distributed primarily to calorie and weight conscious consumers. The Company reported a net loss of $7.66 million in 2011, compared with a net loss of $6.91 million in 2010. The Company's balance sheet at March 31, 2012, showed $2.15 million in total assets, $4.62 million in total liabilities, all current, and a $2.47 million stockholders' deficit. In its audit report for the 2011 financial statements, Marcum LLP, in Bala Cynwyd, Pennsylvania, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company had a working capital deficiency of $3.17 million, an accumulated deficit of $45,492,945, stockholders' deficit of $1.74 million and no cash on hand. The Company had net losses of $7.67 million and $6.91 million for the years ended Dec. 31, 2011, and 2010, respectively. Additionally, the Company is currently in arrears under its obligation for the purchase of trademarks. Under the agreement, the seller of the trademarks may choose to exercise their legal rights against the Company's assets, which includes the trademarks. SOLUTIA INC: Moody's Lifts Rating on Sr. Unsecured Notes From B1 ---------------------------------------------------------------- Moody's Investors Service raised the ratings of the unsecured debt of Solutia Inc. to Baa2 and withdrew its Corporate Family Rating, senior secured term loan rating and Probability of Default Rating. These actions follow the closing of the acquisition of Solutia Inc. by Eastman Chemical Company (Eastman) and the irrevocable transfer of cash to the trustee that is sufficient to fund the redemption of Solutia's 8-3/4% Senior Notes due 2017 and 7 7/8% Senior Notes due 2020. Moody's also affirmed Eastman's Baa2 senior unsecured ratings, it Prime-2 rating for commercial paper and its stable outlook. "The acquisition of Solutia will stress Eastman's Baa2 rating for the next 12-18 months until it has the opportunity to de-lever and grow the combined company" stated John Rogers, Senior Vice President at Moody's Investors Service. "While economic headwinds have increased, even under conservative financial assumptions Eastman should be able to return financial metrics to reasonable levels by the end of 2013." Ratings Rationale Solutia's unsecured notes have been raised to a level that is on par with Eastman's rating due to the irrevocable deposit of funds with the trustee. The note will be redeemed in early August in two transactions, Moody's will withdraw the ratings on these notes once the repayment has been completed. Eastman's Baa2 rating is tempered by elevated pro forma leverage immediately subsequent to the acquisition, with Net Debt/EBITDA of 3.5x (including Moody's adjustments). However, Moody's expects that the combined businesses can de-lever by over $700 million in the following 18 months to levels that would solidly support an investment grade rating. Furthermore, Moody's expects that by the end of 2013, Eastman's credit metrics should fall below 2.8x Net Debt/EBITDA and above 23% Retained Cash Flow/Net Debt. The Baa2 rating is also supported by a demonstrated history of significant free cash flow generation at both Eastman and Solutia. Moody's also noted that the size of the acquisition and the lack of operational synergies, which increases integration risk, are also modest negatives for the credit. Additionally, weakening economic conditions in Europe and slowing growth in Asia will provide headwind over the next year reducing potential growth subsequent to the acquisition. The stable outlook reflects the strong organic growth expected from Eastman's operations. Eastman's rating could come under pressure if the company is unable to significantly improve credit metrics over the 12-18 months following the close of the acquisition, lowering its Debt/EBITDA below 3.0x and raising its Retained Cash Flow/Net Debt to over 20%. Failure to achieve these targets could result in a negative rating action. The stable outlook also assumes that the integration of Solutia will proceed as planned by the company without any significant challenges. Eastman's ratings could only be upgraded once its leverage once again falls below 2.0x for a sustained period. Ratings raised: Solutia Inc. Senior unsecured notes to Baa2 from B1 Ratings Withdrawn Solutia Inc. LT Corporate Family Ratings (domestic currency) Senior Secured Bank Credit Facility (domestic currency) Senior Unsec. Shelf (domestic currency) Subordinate Shelf (domestic currency) Pref. Shelf (domestic currency) Probability of Default Rating The principal methodology used in rating Eastman Chemical was the Global Chemical Industry Methodology published in December 2009. Solutia, headquartered in St. Louis, Missouri, produces and sells a diverse portfolio of performance materials and specialty chemicals. End markets for Solutia's products include automotive, architectural (residential and commercial), aerospace, process manufacturing, construction, electronic/electrical, and industrial. Net sales for the LTM period ending March 31, 2012 were $2.1 billion. Headquartered in Kingsport, Tennessee, Eastman Chemical Company is a major producer of acetate tow, and a broad array of specialty plastics and resins, as well as both commodity and specialty chemicals. Eastman reported sales of roughly $7.2 billion for the LTM ending March 31, 2012. SOUTH EDGE: Meritage Action Should Be Heard in Nevada ----------------------------------------------------- Bankruptcy Judge John E. Joffman, Jr., in Columbus, Ohio, said Nevada is the proper venue of the lawsuit filed by Meritage Homes Corporation and Meritage Homes of Nevada, Inc., against JPMorgan Chase Bank, N.A., for breach of agreements involving the Inspirada residential development, as the action is related to the Chapter 11 case of South Edge LLC, the project's owner and developer. Meritage, one of eight homebuilders that own the 2,000-acre Inspirada project in Henderson, Nevada, sued JPMorgan, among the project's secured lenders, in the Common Pleas Court of Franklin County, Ohio, in August 2011. JPMorgan filed a notice of removal and a motion seeking transfer of the lawsuit to the U.S. District Court for the District of Nevada, arguing that the action is related to South Edge's bankruptcy case pending in Nevada bankruptcy court. JPMorgan contends the State Court Action was related to the South Edge case on the date of the removal notice -- Sept. 2, 2011 -- because, if Meritage were found liable on a repayment guaranty, this conceivably could have resulted in reducing the Lenders' claims against the South Edge bankruptcy estate. Meritage argues that this is not so given the structure of the South Edge chapter 11 plan: prior to confirmation, a payment by Meritage could have reduced the amount of the lenders' claims -- in the aggregate amount of roughly $382 million -- to roughly $369 million, but that is still more than the $335 million that the lenders agreed to receive under a settlement with the project's other owners in exchange for the lenders' claims being deemed fully satisfied. The Plan was sponsored by the lenders and the project's other owners. Meritage filed the lone objection to the plan. Meritage points out that, after confirmation, any recovery by JPMorgan on the repayment guaranty would inure to the benefit of the settling homebuilders, not to the lenders: JPMorgan incorrectly states that if Meritage is successful in the State Court Action, South Edge will be burdened by additional liabilities. Meritage filed an unliquidated claim in the bankruptcy case. The Plan provides that the Settling Builders will pay JPMorgan and the other members of the lending group $335 million on their secured claim, with the remaining amount of roughly $47 million being treated as an unsecured claim. The unsecured deficiency claims of the lenders are satisfied by each lender receiving its pro rata share of $500,000. The lenders will hold no further claims against South Edge. In addition, the Settling Builders will fund an escrow equal to the amount alleged to be due from Meritage pursuant to the Repayment Guaranty. The Plan provides that each of the lenders has the option of taking its pro rata share from the escrow or retaining its claims against Meritage. According to Judge Joffman, Meritage ignores the fact that, as of the Removal Date, confirmation of the Plan was not a foregone conclusion. On the Removal Date, the Plan had not yet been confirmed, and Meritage was strenuously opposing confirmation on multiple grounds, including alleging a lack of good faith on the part of the plan proponents. Although the Plan was later confirmed, as of the Removal Date it certainly was conceivable that it would not be. And if the Plan had not been confirmed, it is conceivable that the settlement under which the Lenders agreed to accept less than the full amount owed them in full satisfaction of their claims would have been in jeopardy. "Under that scenario -- which was certainly conceivable as of the Removal Date -- a payment by Meritage under the Repayment Guaranty conceivably could have reduced the amount of the Lenders' claim against the Estate. And it is well established that an action that could result in a reduction of claims against the estate gives rise to the type of conceivable effect on the estate required to support a finding of related-to jurisdiction," Judge Joffman said. Judge Joffman held the State Court Action was related to the South Edge case on the Removal Date and remains related as of the present time; transfer of the State Court Action to the Nevada Federal District Court is in the interest of justice and would serve the interests of convenience; and equitable remand of the State Court Action to the Ohio State Court would not be appropriate. Judge Joffman recommends that the Ohio Federal District Court grant the Transfer Motion. The Court also recommends that the Ohio Federal District Court deny the Remand Motion without prejudice to the renewal of the motion in the Nevada Federal District Court. The case is Meritage Homes Corporation and Meritage Homes of Nevada, Inc., Plaintiffs and Counter-Defendants, v. JPMorgan Chase Bank, N.A., Defendant and Counter-Claimant, Adv. Proc. No. 11-2388 (Bankr. S.D. Ohio). A copy of the Court's June 26, 2012 Memorandum Opinion and Order is available at http://is.gd/kFe2SQ from Leagle.com. About South Edge Las Vegas, Nevada-based South Edge LLC owns the Inspirada project, an uncompleted 2,000-acre residential development in Henderson, Nevada, about 16 miles (26 kilometers) southeast of Las Vegas. The eight owners of the project include an affiliate of KB Home, a 49% owner. Other owners are Coleman Toll LP with 10.5%, Pardee Homes Nevada Inc. with 4.9%, Meritage Homes with 3.5%, and Beazer Homes USA Inc. with 2.6%. JPMorgan Chase Bank, N.A., Credit Agricole Corporate and Investment Bank, and Wells Fargo Bank, N.A., filed an involuntary chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 10-32968) on Dec. 9, 2010, against South Edge, LLC. The petitioning creditors are part of a lender group that provided a $595 million credit. New York-based JPMorgan serves as lender and agent for the group. South Edge filed motions to dismiss the involuntary petition. The Court conducted a contested trial on Jan. 24 and 25, 2011, and Feb. 2 and 3, 2011. On Feb. 3, 2011, the Court entered an order for relief under Chapter 11 of the Bankruptcy Code against the Debtor and issued an order directing the appointment of a chapter 11 trustee. The United States Trustee appointed Cynthia Nelson to serve as Chapter 11 trustee on Feb. 20, 2011. The Court approved the appointment three days later. South Edge is represented by lawyers at Klee, Tuchin, Bogdanoff and Stern LLP, and The Schwartz Law Firm, Inc., as legal counsel. The Chapter 11 trustee also tapped Schwartzer & McPherson Law Firm as local counsel. Petitioning creditors JPMorgan Chase Bank, N.A., and Wells Fargo Bank, N.A., are represented by lawyers at Morrison and Foerster LLP; and Lewis and Roca LLP. Credit Agricole is represented by lawyers at Haynes and Boone LLP, and Jolley Urga Wirth Woodbury & Standish. On Oct. 27, 2011, the Bankruptcy entered an order confirming a joint plan of reorganization that will implement a settlement negotiated in May by the secured lenders with the Chapter 11 trustee and the homebuilders that represented 92% of the ownership interests in the project. The plan was proposed by JPMorgan Chase Bank, N.A., as administrative agent under the Prepetition Credit Agreement, and the settling homebuilders. The plan calls for the settling homebuilders to pay the lenders $335 million to settle their claims. Meritage filed the sole objection to the plan and was not part of the settling group. Meritage has taken an appeal from the confirmation order. A copy of the Joint Plan of Reorganization proposed by JPMorgan Chase Bank, N.A., as administrative agent under the prepetition credit agreement, and the Settling Builders (amended as of Oct. 21, 2011) is available for free at: http://bankrupt.com/misc/southedge.dkt1309.pdf A copy of the Order confirming the Joint Plan of Reorganization is available for free at: http://bankrupt.com/misc/southedge.dkt1335.pdf SPIRIT MOUNTAIN: Case Summary & 10 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Spirit Mountain Group, Inc. 2935 N. Arkansas Street Rogers, AR 72756 Bankruptcy Case No.: 12-72616 Chapter 11 Petition Date: July 4, 2012 Court: United States Bankruptcy Court Western District of Arkansas (Fayetteville) Judge: Ben T. Barry Debtor's Counsel: Donald A. Brady, Jr., Esq. BLAIR, BRADY & HENSON ATTORNEYS AT LAW 109 N. 34th Street P.O. Box 1715 Rogers, AR 72756 Tel: (479) 631-0100 Fax: (479) 631-8052 E-mail: melisechilders@hotmail.com Scheduled Assets: $579,101 Scheduled Liabilities: $2,459,670 A copy of the Company's list of its 10 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/arwb12-72616.pdf The petition was signed by Wanda Munson, president. STANCORP FIN'L: Fitch Keeps 'BB+' Rating on Jr. Subordinated Debt ----------------------------------------------------------------- Fitch Ratings has affirmed the long-term IDR of StanCorp Financial Group, Inc. (SFG) at 'BBB+'. Fitch has also affirmed the Insurer Financial Strength (IFS) ratings of its subsidiaries (Standard Insurance Company and Standard Life Insurance Company of New York) at 'A'. The Rating Outlook is Stable. Fitch's affirmation reflects a moderate decline in SFG's overall operating profitability in first quarter-2012 (1Q'12) relative to 4Q'11 and 1Q'11, which is in line with Fitch's expectations, and essentially stable financial leverage. SFG's historically favorable earnings, driven by its group long- term disability (LTD) and group life insurance business, have weakened in recent years due to a competitive market environment and poor economic conditions. SFG reported pretax operating income of $198 million in 2011, down from $330 million in 2010. In 1Q'12, SFG reported pretax operating income of $48 million, down from $52 million in 1Q'11. The benefit ratio for SFG's group insurance segment, its primary earnings driver, has increased in each of the past four years from 73.6% in 2008 to 83.1% in 2011. It increased further to 83.5 in 1Q'12. SFG's statutory total adjusted capital declined modestly in 2011 to $1.3 billion. The NAIC risk based capital ratio of its insurance subsidiaries also declined modestly in 2011 to 327% from 331% in 2010. Fitch estimates the 2011 ratio benefited approximately 15 points from a reinsurance agreement executed at the end of the year. Statutory dividend capacity is expected to decline in 2012 relative to 2011. SFG's ratings are supported by the company's adequate balance sheet fundamentals and solid competitive position in the U.S. group insurance market. SFG's balance sheet fundamentals reflect strong asset quality, good risk adjusted capitalization, and reasonable financial leverage. SFG's total financing and commitments ratio was approximately 0.4 times (x) and adjusted financial leverage was 27% at March 31, 2012. SFG has near term refinancing risk from its $250 million debt maturity in October 2012. Fitch believes the holding company has sufficient financial capacity from existing cash, bank lines and insurance company dividends to meet this obligation. Fitch believes that SFG's insurance subsidiaries maintain a high- quality bond portfolio. Below investment grade bonds accounted for only 6% of the fixed maturity portfolio, a low 27% of total adjusted capital (TAC) at Dec. 31, 2011. Market values of SFG's fixed maturity investments continue to improve with the investment market, bringing gross unrealized losses down to just $20 million and gross unrealized gains up to $581 million at year-end 2011. The speed and amount of recovery reflects the conservative nature of SFG's bond portfolio and the relatively low amount of financial sector securities. SFG's commercial mortgage allocation of approximately 40% of total invested assets at Dec. 31, 2011 is much higher than the industry average. However, Fitch believes a somewhat higher mortgage allocation is complementary to SFG's stable liability structure. Commercial mortgage loan loss experience, although heightened in recent years, remains in line with Fitch's overall loss expectations and not far above industry delinquency experience. Longer-term concerns over the illiquidity of SFG's larger commercial mortgage portfolio persist. Key rating triggers that could result in an upgrade include: -- A substantial increase in run-rate risk-adjusted capital above 350%, with no significant deterioration in capital quality; -- A long-term improving trend in the group benefit ratio substantially below its historic baseline of about 76%. Key rating triggers that could result in a downgrade include: -- A prolonged deterioration in SFG's group benefit ratio above the 2011 level of 83%; -- An increase in financial leverage above 30%; -- A decrease in RBC below 300% or a significant decrease in the quality of capital supporting SFG's RBC; -- A significant deterioration in the performance of SFG's commercial mortgage loan portfolio. Fitch affirms the following ratings with a Stable Outlook: StanCorp Financial Group -- Long-term IDR at 'BBB+'; -- Senior debt rating at 'BBB'; -- 10-year 6.875% $250 million senior notes due Oct. 1, 2012 at 'BBB'; -- Junior subordinated debt rating at 'BB+'; -- 60-year $300 million junior subordinated debt due May 29, 2067 at 'BB+'. Standard Insurance Company -- IFS at 'A'. Standard Life Insurance Co. of New York --IFS at 'A'. SYNIVERSE HOLDINGS: Moody's Alters Ratings Outlook to Stable ------------------------------------------------------------ Moody's Investors Service has changed the outlook on Syniverse Holdings Inc. to stable from positive following the company's announcement that it has reached a definitive agreement to purchase its European peer MACH for EUR550 million (US$690 million). Moody's views the acquisition favorably from a strategic perspective, but the change in outlook to stable from positive reflects the anticipated temporary weakening of Syniverse's credit metrics. As part of the action, Moody's also affirms all of Syniverse's ratings, including the B2 corporate family rating, based on Moody's view that this transaction will provide Syniverse a more diverse customer base, greater scale and a stronger competitive position. Issuer: Syniverse Holdings, Inc. Outlook Actions: Outlook, Changed To Stable From Positive Ratings Rationale The B2 corporate family rating reflects Syniverse's financial leverage and the risk that EBITDA growth could be derailed by technology changes or competitive forces. Balancing these risk factors are Syniverse's strong operating performance and cash flows, which have allowed the company to modestly de-lever following its LBO in January of 2011. Syniverse's transaction- based, stable business model and low capital intensity result in a credit profile which is stronger than a typical B2 issuer. However, the company's financial policy, specifically its history of M&A and the potential for cash distributions to shareholders, constrains the rating. The acquisition of MACH will increase Syniverse's scale and diversify its revenue base, which is currently somewhat concentrated among the two top US CDMA-based wireless carriers (Sprint & Verizon). MACH's strong presence in Europe and growth potential in Africa, India and Asia will complement Syniverse's expansion strategy. Additionally, the two businesses are quite similar and should offer cost reduction opportunities. Recent EU regulations have lowered or implemented caps on roaming rates, which will greatly reduce roaming fees paid by consumers and which could result in higher mobile data roaming volumes. Although mostly positive, the acquisition does have some risks. European carriers are under significant pressure to cut costs as top line revenues stagnate, which could cause price pressure for ancillary services providers like Syniverse and MACH. Additionally, cost pressure is forcing consolidation among European carriers who have been pursuing network sharing arrangements. Text messaging volume growth is slowing in Europe just as in the US as consumers utilize data networks for messaging. Finally, roaming arrangements in Europe are tightly regulated by the EU, and Syniverse's acquisition of MACH could potentially increase its regulatory burden, possibly as a condition of the deal's approval. Syniverse has not disclosed the terms of the transaction beyond the acquisition price. Moody's believes that the deal will result in modestly higher leverage, but that the company's financial profile will remain consistent with a B2 rating, even if the transaction is fully debt-financed. The company must receive EU approval for the deal, which will likely take two to three quarters to close. In this interim timeframe, Moody's believes that Syniverse will continue to generate strong cash flows which could allow the company to finance part of the acquisition with cash. The B1 rating on Syniverse's senior secured credit facility could be upgraded if junior debt is used to finance the transaction. However, the Caa1 rating on the unsecured notes is unlikely to change, regardless of the structure of the deal's final financing. Moody's expects Syniverse to have very good liquidity over the next twelve months. The company had approximately $232 million in cash or equivalents at 3/31/12. Moody's expects the company to generate over $150 million in free cash flow and maintain full availability of its $150 million revolving credit facility over the next twelve months. Moody's could upgrade Syniverse's ratings if leverage (Moody's adjusted) trends towards 4.5x and free cash flow-to-debt approaches 10%, both on a sustainable basis. The ratings could face downward pressure if the company no longer generates revenue growth, or free cash flow-to-debt falls below 5%. Should leverage remain near 6x for an extended period, and/or liquidity be strained in any way, Moody's would consider a downward rating action. The principal methodology used in rating Syniverse Holdings, Inc 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. Headquartered in Tampa, Florida, Syniverse Holdings, Inc. is a leading provider of interoperability and network services for wireless telecommunication carriers. Having once been an operating unit of GTE/Verizon, Syniverse has been a leader for many years in providing third-party, inter-carrier services to the telecom market with a historic concentration in the US serving CDMA carriers. In recent years, the company has expanded its product offering to encompass GSM capability and geographic presence through both acquisitions and new product development adapting both to a changing technology and customer landscape. The company had revenues of $768 million for fiscal year 2011. TALON THERAPEUTICS: Amends Investment Pact with Warburg, et al. --------------------------------------------------------------- Talon Therapeutics, Inc., on Jan. 9, 2012, entered into an Investment Agreement with Warburg Pincus Private Equity X, L.P., and Warburg Pincus X Partners, L.P., and Deerfield Private Design Fund, L.P., Deerfield Private Design International, L.P., Deerfield Special Situations Fund, L.P., and Deerfield Special Situations Fund International Limited, whereby the Company issued and sold to the Purchasers an aggregate of 110,000 shares of its Series A-2 Convertible Preferred Stock at a purchase price of $100 per share, and pursuant to which the Purchasers have the right, but not the obligation, to purchase up to 600,000 shares of the Company's Series A-3 Convertible Preferred Stock at a purchase price of $100 per share, in one or more tranches of at least 50,000 shares of Series A-3 Preferred per tranche. On July 3, 2012, the Company and the Purchasers entered into Amendment No. 1 to the Investment Agreement, pursuant to which the Minimum Series A-3 Additional Investment was reduced from 50,000 shares of Series A-3 Preferred to 30,000 shares of Series A-3 Preferred. Pursuant to the terms of the Investment Agreement, as amended, the Company issued and sold to the Purchasers an aggregate of 30,000 shares of Series A-3 Preferred at a price per share of $100, for aggregate proceeds of $3,000,000. The offer and sale of those shares constituted a private placement under Section 4(2) of the Securities Act of 1933, as amended, in accordance with Regulation D promulgated thereunder. No general solicitation was involved in connection with the offer and sale of those shares, and each of the Purchasers has represented to the Company that it is an "accredited investor." About Talon Therapeutics Formerly known as Hana Biosciences, Inc., Talon Therapeutics Inc. (TLON.OB.) -- http://www.talontx.com/-- is a biopharmaceutical company dedicated to developing and commercializing new, differentiated cancer therapies designed to improve and enable current standards of care. The company's lead product candidate, Marqibo, potentially treats acute lymphoblastic leukemia and lymphomas. The Company has additional pipeline opportunities some of which, like Marqibo, improve delivery and enhance the therapeutic benefits of well characterized, proven chemotherapies and enable high potency dosing without increased toxicity. Effective Dec. 1, 2010, Hana Biosciences Inc. changed its name to Talon Therapeutics Inc. The name change was effected by merging Talon Therapeutics, Inc., a wholly-owned subsidiary of the Company, with and into the Company, with the Company as the surviving corporation in the merger. The Company reported a net loss of $18.82 million for the year ended Dec. 31, 2011, compared with a net loss of $25.98 million during the prior year. The Company's balance sheet at March 31, 2012, showed $7.77 million in total assets, $62.23 million in total liabilities, $34.66 million in redeemable convertible preferred stock, and a $89.13 million total stockholders' deficit. BDO USA, LLP, in San Jose, California, issued a "going concern" qualification on the financial statements for the year ended Dec. 31, 2011, citing recurring losses from operations and net capital deficiency that raise substantial doubt about the Company's ability to continue as a going concern. TEJAL INVESTMENT: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Tejal Investment, LLC 815 N Main Street Sunset, UT 84015-0000 Bankruptcy Case No.: 12-28606 Chapter 11 Petition Date: July 3, 2012 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: William T. Thurman Debtor's Counsel: Tyler T. Todd, Esq. LABRUM NEELEY VELEZ & ASSOCIATES, PC 1173 South 250 West, Suite 311 St. George, UT 84770 Tel: (435) 688-9558 Fax: (435) 673-1640 E-mail: tyler@1law.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 Hasmukh Natha, member. THINES LLC: M&T Bank Has $726,800 Secured Claim ----------------------------------------------- Bankruptcy Judge Nancy V. Alquist signed off on a consent order allowing Manufacturers and Traders Trust Company's secured claim against Thines, LLC, in these amounts: Principal: $568,287.53 Interest: $23,761.38 ($118.39 per diem) Prepayment Premium: $120,898.42 Late Charges: $1,609.05 Attorneys' Fees: $11,251.55 ------------ Total as of 9/20/11: $726,807.93 A copy of the Stipulation and Consent Order signed by the Court on July 3, 2012, is available at http://is.gd/ie9sJLfrom Leagle.com. About Thines LLC Thines LLC, based in Jessup, Maryland, filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 11-28872) on Sept. 20, 2011. Judge Nancy V. Alquist presides over the request. Marc Robert Kivitz, Esq., in Baltimore, serves as the Debtor's counsel. The Debtor scheduled $1,960,289 in assets and $2,685,032 in debts. The petition was signed by Tyrone Hines, managing member. Creditor Manufacturers and Traders Trust Company is represented in the case by Michael C. Bolesta, Esq., at Gebhardt & Smith LLP. TRANS ENERGY: Seven Directors Elected at Annual Meeting ------------------------------------------------------- Trans Energy, Inc., held its 2012 annual general and special meeting of shareholders on June 28, 2012. The Company's shareholders voted to elect seven persons as directors to serve for terms of one year until the next annual meeting or until their successors have been elected and qualified, namely: (1) John G. Corp; (2) Loren E. Bagley; (3) William F. Woodburn; (4) Robert L. Richards; (5) Richard L. Starkey; (6) Stephen P. Lucado; and (7) Dr. Benjamin H. Thomas. The Company's shareholders voted to approve a proposal to ratify the appointment of Maloney + Novotny, LLC, as the Company's independent registered public accounting firm for the year ending Dec. 31, 2012. About Trans Energy St. Mary's, West Virginia-based Trans Energy, Inc. (OTC BB: TENG) -- http://www.transenergyinc.com/-- is an independent energy company engaged in the acquisition, exploration, development, exploitation and production of oil and natural gas. Its operations are presently focused in the State of West Virginia. In its audit report on the Company's 2011 results, Maloney + Novotny, LLC, in Cleveland, Ohio, noted that the Company has generated significant losses from operations and has a working capital deficit of $18.37 million at Dec. 31, 2011, which together raises substantial doubt about the Company's ability to continue as a going concern. The Company's balance sheet at March 31, 2012, showed $55.15 million in total assets, $28.96 million in total liabilities, and $26.18 million in total stockholders' equity. TRIBUNE CO: Bank Debt Trades at 33% Off in Secondary Market ----------------------------------------------------------- Participations in a syndicated loan under which Tribune Co. is a borrower traded in the secondary market at 66.50 cents-on-the- dollar during the week ended Friday, July 6, 2012, an increase of 1.29 percentage points from the previous week according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. The Company pays 300 basis points above LIBOR to borrow under the facility. The bank loan matures on May 17, 2014. The loan is one of the biggest gainers and losers among 153 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Protracted negotiations and mediation efforts and numerous proposed plans of reorganization filed by Tribune Co. and competing creditor groups have delayed Tribune's emergence from bankruptcy. Many of the disputes among creditors center on the 2007 leveraged buyout fraudulence conveyance claims, the resolution of which is a key issue in the bankruptcy case. The bankruptcy court has scheduled a May 16 hearing on Tribune's plan. Tribune CRO Don Liebentritt said it is possible the media company could emerge late in the third quarter of 2012. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) VALENCE TECHNOLOGY: Carl Warden Extends Debt Maturity to July 31 ---------------------------------------------------------------- Valence Technology, Inc., received a letter from Carl Warden which informed the Company that effective as of June 29, 2012, Mr. Warden agreed to extend the maturity date of the $3.0 million in outstanding principal owed to Mr. Warden to July 31, 2012. The Company received a letter from Mr. Warden on April 30, 2012, which informed the Company that effective in March 2012, Mr. Warden had purchased from iStar Tara LLC and successor in interest to SFT 1, Inc., the outstanding principal amount of $3.0 million under that certain Loan and Security Agreement dated as of July 13, 2005, among the Company, iStar and Carl E. Berg, the Chairman of the Company's Board of Directors and the Company?s principal stockholder. The April 30, 2012, letter also extended the maturity date of the $3.0 million in outstanding principal owed to Mr. Warden to June 30, 2012. About Valence Technology Austin, Texas-based Valence Technology, Inc. (NASDAQ: VLNC) -- http://www.valence.com/-- is a global leader in the development of safe, long-life lithium iron magnesium phosphate energy storage solutions and provides the enabling technology behind some of the world's most innovative and environmentally friendly applications. Valence Technology has its Research & Development Center in Nevada, its Europe/Asia Pacific Sales office in Northern Ireland and global fulfillment centers in North America and Europe. The Company reported a net loss of $12.73 million on $44.38 million of revenue for the year ended March 31, 2012, a net loss of $12.68 million on $45.88 million of revenue for the year ended March 31, 2011, and a net loss of $23.01 million on $16.08 million of revenue for the year ended March 31, 2010. The Company's balance sheet at March 31, 2012, showed $31.52 million in total assets, $82.63 million in total liabilities, $8.61 million in redeemable convertible preferred stock and a $59.71 million total stockholders' deficit. PMB Helin Donova, LLP, in Austin, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended March 31, 2012, citing recurring losses from operations, negative cash flows from operations and net stockholders' capital deficiency which raised substantial doubt about the Company's ability to continue as a going concern. Bankruptcy Warning The Company said in the fiscal 2012 annual report that it cannot achieve a competitive cost structure, achieve profitability, and acquire access to capital markets on acceptable terms, the Company will be unable to fund its obligations and sustain its operations, and may be required to liquidate its assets, cease operations or file for bankruptcy protection. VUZIX CORP: LC Capital Discloses 14.8% Equity Stake --------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, LC Capital Master Fund, Ltd., and its affiliates disclosed that, as of June 29, 2012, they beneficially own 46,191,220 shares of common stock of Vuzix Corporation which represents 14.83% of the shares outstanding. LC Capital previously reported beneficial ownership of 28,963,848 common shares or a 9.99% equity stake as of Jan. 23, 2012. A copy of the amended filing is available for free at: http://is.gd/oB2KS8 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. VUANCE LTD: Posts $105,000 Net Income in First Quarter ------------------------------------------------------ Vuance Ltd. reported net income of US$105,000 on US$2.18 million of revenue for the three months ended March 31, 2012, compared with a net loss of US$173,000 on US$1.84 million of revenue for the same period during the prior year. The Company's balance sheet at March 31, 2012, showed US$2.07 million in total assets, US$7.44 million in total liabilities and a US$5.37 million total shareholders' deficit. A copy of the press release is available for free at: http://is.gd/9yhgl3 About Vuance Ltd. Qadima, Israel-based Vuance Ltd. is a leading provider of Wireless Identification Solutions. The Company currently offers an Active RFID technology, a long, active radio frequency identification equipment that utilizes active radio frequency communications to track assets, people and objects for potential governmental agency and commercial customers. The Company reported net income of US$1.02 million on US$7.92 million of revenue in 2011, compared with a net loss of US$1.96 million on US$7.38 million of revenue in 2010. In the auditors report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Fahn Kanne & Co. Grant Thornton Israel expressed substantial doubt about the Company's ability to continue as a going concern. The indepdent auditors noted that the Company has incurred substantial recurring losses and negative cash flows from operations and, as of Dec. 31, 2011, the Company had a working capital deficit and total shareholders' deficit. WEST END FINANCIAL: Judge Cuts Robinson Brog, Arent Fox Fees ------------------------------------------------------------ Law firms Robinson Brog Leinwand Greene Genovese & Gluck P.C., and Arent Fox LLP saw their take-home pay slashed in the bankruptcy case of West End Financial Advisors, LLC. According to Bankruptcy Judge Stuart M. Bernstein, based on his own review of the parties' applications: -- Robinson Brog is entitled to a final award of fees and expenses, respectively, in the amounts of $1,926,074 and $43,968; and -- Arent Fox is entitled to a final award of fees and expenses, respectively, in the amounts of $173,953 and $17,121. Robinson Brog served as counsel to the Debtors. The firm originally sought final fees and expenses of $2,151,281 and $43,968. Arent Fox served as attorneys for Mark S. Radke, Esq., the Independent Monitor appointed by the District Court. Arent Fox originally sought an award of pre-petition fees and expenses in the amounts of $32,792 and $8,004, respectively, and an award of post-petition fees and expenses in the amounts of $283,941 and $20,249. The Debtors and the Official Committee of Unsecured Creditors objected to Arent Fox's application, and the United States Trustee and the Securities & Exchange Commission objected to Robinson Brog's application. A copy of the Court's July 2, 2012 Memorandum Decision is available at http://is.gd/L5xuBjfrom Leagle.com. About West End Financial West End Financial Advisors LLC, Sentinel Investment Management Corp. and a number of affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-11152) in Manhattan on March 15, 2011. New York-based West End estimated its assets and debts at $1 million to $10 million. Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as the Debtors' bankruptcy counsel. William Landberg created WEFA in 2000 as an investment and financial management company. Subsequently he purchased Sentinel Investment Management Corp., a boutique investment advisory company. Sentinel and WEFA targeted individual private clients for investments in fixed income funds and alternative investment products. Mr. Landberg's ultimately resigned from all West End related entities effective June 2, 2009, following a probe on misappropriation of funds. Mr. Landberg pleaded guilty in November to securities fraud. He agreed to forfeit $8.7 million in assets. West End filed under Chapter 11 in March shortly after the U.S. District Court appointed a monitor at the behest of the Securities and Exchange Commission. West End was accused by the SEC of committing securities fraud and misusing client funds. Schedules of assets and liabilities for West End and its funds showed assets of $400,000 and debt of $6.7 million, not including $66 million from investors who may or may not be considered creditors. Debt includes $5.5 million in secured claims, according to the schedules. Secured creditors with the largest claims are DZ Bank ($118.1 million), West LB ($41 million), Iberia Bank ($11.3 million), and Suffolk County National Bank ($8.3 million). In July 2011 the bankruptcy judge ruled that West End should be substantively consolidated with affiliates. West End Financial filed a plan of liquidation in bankruptcy court in August. On Jan. 25, 2012, the Court confirmed West End Financial's Third Amended Plan of Liquidation. WESTERN BRIDGE: Closes Doors; NCUA's Resolution Plan Proceeds ------------------------------------------------------------- The National Credit Union Administration (NCUA) announced on July 7 the liquidation of Western Bridge Corporate Federal Credit Union (Western Bridge) of San Dimas, Calif. Catalyst Corporate Federal Credit Union (Catalyst) of Plano, Texas, recently completed the migration of Western Bridge's 326 capitalizing members ($50.3 million capital contributed) and services, and Western Bridge closed at the end of the day Friday. "The closing of Western Bridge's doors is an important milestone for the entire credit union system," said NCUA Board Chairman Debbie Matz. "Consistent with NCUA's Corporate Resolution Plan, we have smoothly transferred the former corporate's members and services to Catalyst while minimizing costs for all credit unions." Through the Corporate Resolution Plan, NCUA has worked to build a more structurally sound corporate credit union system and maintain confidence in the credit union system. As a result of rules adopted in 2010, corporate credit unions now need to maintain higher capital levels, while complying with stricter investment standards. NCUA conserved the former Western Corporate Federal Credit Union in 2009 and created Western Bridge to ensure continuity of service and operations for member consumer credit unions. In 2011, the members of Western Bridge initially sought but failed to capitalize a new corporate credit union, United Resources Corporate Federal Credit Union. As conservator of Western Bridge, NCUA then sought an acquisition solution that would minimize service disruption to the consumer credit union members of Western Bridge and ensure the best financial outcome for the Temporary Corporate Credit Union Stabilization Fund. NCUA conducted a competitive bidding process to identify a buyer for Western Bridge. Last December, the NCUA Board awarded Catalyst the exclusive right to acquire Western Bridge. Catalyst was created by the 2011 merger of Southwest Bridge Federal Credit Union and Georgia Corporate Federal Credit Union. With the transfer of Western Bridge's members, Catalyst Corporate now has 1,232 members and $147 million in capital. Western Bridge is the first federally insured corporate credit union liquidated in 2012. NCUA is the independent federal agency created by the U.S. Congress to regulate, charter, and supervise federal credit unions. With the backing of the full faith and credit of the U.S. Government, NCUA operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of more than 92 million account holders in all federal credit unions and the overwhelming majority of state-chartered credit unions. * Bankruptcy Filings Slide In 1st Half Of 2012, Report Says --------------------------------------------------------- Jamie Santo at Bankruptcy Law360 reports that bankruptcies decreased across the board in the first half of 2012 with commercial filings taking the biggest dip, falling 21.8% to 30,946 against 39,598 from the same six-month period in 2011, according to figures released Thursday. Chapter 11 filings from January to June also fell nationwide this year, with 5,313 cases marking a 12.5 percent decrease from the 6,070 reported in the same period in 2011, while total bankruptcies totaled 632,130, a 13.6 percent slide from 731,500 a year ago, Bankruptcy Law360 relates. * McGuireWoods' Cox Jumps to Bradley Arant's Charlotte Office ------------------------------------------------------------- Bradley Arant Boult Cummings LLP announced July 5, 2012, the continued strategic expansion of its Charlotte office with the addition of Robert A. Cox, Jr. as partner. Previously a partner with McGuireWoods, Cox joins the firm's Bankruptcy, Restructuring, and Distressed Investing Practice Group. He is the fifth new attorney to join the firm in Charlotte so far this year. In April, a group of four attorneys joined the firm's Financial Services Practice Group in Charlotte. Cox focuses his practice on financial restructuring and insolvency, including bankruptcy, creditors' rights, commercial workouts, and distressed asset acquisitions. His experience includes representing corporate debtors, creditors' committees, secured lenders, asset acquirers, and other parties in interest in bankruptcy courts throughout the United States. "Rob is an important addition to our firm, and is another positive step in our continuing to grow our Charlotte office," said Firm Chairman Beau Grenier. "In particular, his background in creditors' rights and litigation is a natural fit for our work with the financial services industry. This is a service area we are expanding for our Charlotte-area clients." The firm's Bankruptcy, Restructuring, and Distressed Investing Practice Group is comprised of 25 attorneys across four offices. Chambers USA gave the practice a Tier 1 ranking in its 2012 guide to leading law firms. Its members have extensive national experience representing debtors and lenders in Chapter 11 proceedings and in out-of-court workouts and restructurings. They regularly serve as counsel to businesses with unsecured claims and complex contractual relationships with Chapter 11 debtors. The group also represents clients involved with the acquisition of distressed businesses, assets, and loans. "Bradley Arant Boult Cummings is well known for its bankruptcy practice, particularly on the debtor side, and moving to the firm is a natural step in the development of my practice," said Cox. "The team assembled at this firm is outstanding, and I am excited by the possibilities as I work with my new colleagues." Cox holds a J.D. from Wake Forest University School of Law and a B.A. from the University of North Carolina at Chapel Hill. * BOND PRICING -- For Week From July 2 to 6, 2012 ------------------------------------------------- Company Coupon Maturity Bid Price ------- ------ -------- --------- A123 SYSTEMS INC 3.750 4/15/2016 27.750 AES EASTERN ENER 9.000 1/2/2017 15.500 AES EASTERN ENER 9.670 1/2/2029 17.500 AGY HOLDING COR 11.000 11/15/2014 49.075 AHERN RENTALS 9.250 8/15/2013 64.500 ALION SCIENCE 10.250 2/1/2015 46.375 AM AIRLN PT TRST 10.180 1/2/2013 93.000 AMBAC INC 6.150 2/7/2087 2.010 AMBAC INC 9.500 2/15/2021 25.250 AMER GENL FIN 4.100 7/15/2012 97.538 AMER GENL FIN 4.875 7/15/2012 100.000 ATP OIL & GAS 11.875 5/1/2015 48.500 ATP OIL & GAS 11.875 5/1/2015 49.600 ATP OIL & GAS 11.875 5/1/2015 48.500 BAC-CALL07/12 5.250 7/15/2018 100.117 BAC-CALL07/12 5.500 10/15/2029 96.760 BAC-CALL07/12 5.800 1/15/2028 100.000 BAC-CALL07/12 5.900 7/15/2029 100.000 BAC-CALL07/12 6.650 7/15/2027 100.000 BAC-CALL07/12 8.250 4/15/2027 101.920 BAC-CALL07/12 8.278 12/1/2026 101.261 BROADVIEW NETWRK 11.375 9/1/2012 69.085 BUFFALO THUNDER 9.375 12/15/2014 35.250 CTL-CALL07/12 7.500 6/15/2023 99.654 DIRECTBUY HLDG 12.000 2/1/2017 18.000 DIRECTBUY HLDG 12.000 2/1/2017 18.000 EASTMAN KODAK CO 7.000 4/1/2017 18.790 EASTMAN KODAK CO 7.250 11/15/2013 18.056 EASTMAN KODAK CO 9.200 6/1/2021 13.393 EASTMAN KODAK CO 9.950 7/1/2018 16.100 EDISON MISSION 7.500 6/15/2013 60.114 ELEC DATA SYSTEM 3.875 7/15/2023 97.000 ENERGY CONVERS 3.000 6/15/2013 39.750 EVERGREEN SOLAR 13.000 4/15/2015 48.000 FCB/NC CAP-CALL 8.050 3/1/2028 99.250 FONTAINEBLEAU LA 10.250 6/15/2015 0.250 GEOKINETICS HLDG 9.750 12/15/2014 56.000 GLB AVTN HLDG IN 14.000 8/15/2013 28.550 GLOBALSTAR INC 5.750 4/1/2028 48.000 GMX RESOURCES 4.500 5/1/2015 40.000 GMX RESOURCES 5.000 2/1/2013 70.624 GMX RESOURCES 5.000 2/1/2013 73.815 HAWKER BEECHCRAF 8.500 4/1/2015 19.300 HAWKER BEECHCRAF 8.875 4/1/2015 15.500 HAWKER BEECHCRAF 9.750 4/1/2017 3.050 JAMES RIVER COAL 4.500 12/1/2015 39.000 JPM-CALL07/12 5.850 8/1/2035 100.000 KENDLE INTL INC 3.375 7/15/2012 95.750 KV PHARM 12.000 3/15/2015 35.250 LEHMAN BROS HLDG 0.250 12/8/2012 21.625 LEHMAN BROS HLDG 0.250 12/8/2012 21.625 LEHMAN BROS HLDG 0.250 12/12/2013 21.625 LEHMAN BROS HLDG 0.250 1/26/2014 21.625 LEHMAN BROS HLDG 1.000 12/9/2012 21.625 LEHMAN BROS HLDG 1.000 10/17/2013 21.625 LEHMAN BROS HLDG 1.000 3/29/2014 21.625 LEHMAN BROS HLDG 1.000 8/17/2014 21.625 LEHMAN BROS HLDG 1.000 8/17/2014 22.500 LEHMAN BROS HLDG 1.250 2/6/2014 21.625 LEHMAN BROS HLDG 1.500 3/29/2013 21.625 LEHMAN BROS INC 7.500 8/1/2026 7.550 LIFECARE HOLDING 9.250 8/15/2013 61.250 MANNKIND CORP 3.750 12/15/2013 57.000 MASHANTUCKET PEQ 8.500 11/15/2015 9.250 MASHANTUCKET PEQ 8.500 11/15/2015 9.527 MASHANTUCKET TRB 5.912 9/1/2021 9.250 MF GLOBAL LTD 9.000 6/20/2038 38.000 NETWORK EQUIPMNT 7.250 5/15/2014 50.000 NEWPAGE CORP 10.000 5/1/2012 5.050 NGC CORP CAP TR 8.316 6/1/2027 15.150 NSC EQUIP TST H 5.570 7/15/2012 98.873 PATRIOT COAL 3.250 5/31/2013 31.400 PATRIOT COAL 8.250 4/30/2018 43.000 PENSON WORLDWIDE 8.000 6/1/2014 34.496 PENSON WORLDWIDE 12.500 5/15/2017 41.500 PMI GROUP INC 6.000 9/15/2016 22.063 POWERWAVE TECH 3.875 10/1/2027 11.060 POWERWAVE TECH 3.875 10/1/2027 13.427 PRU-CALL07/12 5.500 7/15/2030 100.000 PRU-CALL07/12 5.750 1/15/2030 100.000 REAL MEX RESTAUR 14.000 1/1/2013 46.450 REDDY ICE CORP 13.250 11/1/2015 28.200 REDDY ICE HLDNGS 10.500 11/1/2012 55.500 RESIDENTIAL CAP 6.500 4/17/2013 23.000 RESIDENTIAL CAP 6.875 6/30/2015 25.250 TERRESTAR NETWOR 6.500 6/15/2014 10.000 TEXAS COMP/TCEH 7.000 3/15/2013 15.700 TEXAS COMP/TCEH 10.250 11/1/2015 24.500 TEXAS COMP/TCEH 10.250 11/1/2015 23.250 TEXAS COMP/TCEH 10.250 11/1/2015 29.188 TEXAS COMP/TCEH 15.000 4/1/2021 34.250 TEXAS COMP/TCEH 15.000 4/1/2021 33.500 THORNBURG MTG 8.000 5/15/2013 10.000 TIMES MIRROR CO 7.250 3/1/2013 33.050 TOUSA INC 9.000 7/1/2010 19.875 TOUSA INC 9.000 7/1/2010 26.500 TRAVELPORT LLC 11.875 9/1/2016 38.000 TRAVELPORT LLC 11.875 9/1/2016 38.250 TRIBUNE CO 5.250 8/15/2015 31.065 TRICO MARINE 3.000 1/15/2027 0.750 TRICO MARINE 3.000 1/15/2027 0.750 TXT-CALL07/12 6.200 7/17/2037 95.200 USEC INC 3.000 10/1/2014 48.200 WASH MUT BANK FA 5.125 1/15/2015 0.010 WASH MUT BANK FA 5.650 8/15/2014 0.875 WASH MUT BANK FA 6.875 6/15/2011 0.010 WASH MUT BANK NV 6.750 5/20/2036 0.875 WESTERN EXPRESS 12.500 4/15/2015 55.000 ********* 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 ***