/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/120731.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, July 31, 2012, Vol. 16, No. 211 Headlines 1301 INVESTMENTS: Case Summary & 10 Unsecured Creditors 237 EAST: Seeks Plan Extension as Counsel Busy With Another Case 400 BLAIR: Wells Fargo Permitted to Foreclose 8 MILE: Chapter 11 Case Summary & 4 Unsecured Creditors AGY HOLDING: Decides to Initiate Process to Sell CFM Business ALMA ROSA: Case Summary & 6 Unsecured Creditors AMERICAN AIRLINES: Has Deal With American Eagle Flight Attendants AMWEST IMAGING: Posts $201,000 Net Loss in May 31 Quarter ARCTIC GLACIER: H.I.G. Capital Buys Arctic Glacier Income Fund BONAVIA TIMBER: Plan Confirmed After Deal With Secured Creditor CAESARS ENTERTAINMENT: Amendment to 2012 Incentive Plan Approved CAPITALSOURCE INC: S&P Affirms 'B+/C' Counterparty Credit Ratings CAROLEE'S PROPERTIES: Case Summary & 2 Unsecured Creditors CHARMING SHOPPES: S&P Ups Corp. Credit Rating to 'BB-'; Off Watch CINRAM INTERNATIONAL: Sale to Najafi Gets U.S. Court Approval CIRCLE ENTERTAINMENT: Borrows $450,000 from Directors, et al. CIRCLE STAR: To Issue 5.2 Million Common Shares Under 2011 Plan CITY CENTRAL: City Council Wants Receiver Discharged CLEARWIRE CORP: Incurs $145.8 Million Net Loss in Second Quarter COPPERAS CREEK: Debt Buyer Fails in Bid to Dismiss Bankruptcy Case CORNERSTONE BANCSHARES: Posts $311,000 Net Income in 2nd Quarter CRET RESTORATION: Files List of Largest Unsecured Creditors CRET RESTORATION: Files Schedules of Assets and Liabilities CUSTER ROAD: To Present Plan for Confirmation on Sept. 27 DAVITA INC: S&P Affirms 'BB-' Corp. Credit Rating; Outlook Stable DAZ VINEYARDS: Taps Casterline as Counsel in Pacific Funding Case DELCOR USA: Case Summary & 20 Largest Unsecured Creditors DEX ONE: Reports $52.9 Million Net Income in Second Quarter DIVERSINET CORP: Incurs $1.1-Mil. Net Loss in Second Quarter DUNKIN' BRANDS: Share Repurchase Won't Affect Moody's 'B2' CFR DZ.EYE.N STUDIOS: Hires Cox Smith Matthews as Attorneys ENNIS COMMERCIAL: Wells Fargo Has Plan for Owner Ben Ennis EXPERT CAR: Case Summary & 4 Unsecured Creditors FLEXIBLE WHIPS: Case Summary & 20 Largest Unsecured Creditors FLORIDIAN VEST: Case Summary & 16 Unsecured Creditors GATZ PROPERTIES: Sec. 341 Creditors' Meeting Set for Aug. 24 GAVILON GROUP: S&P Keeps 'BB' Corp. Cedit Rating on Watch Positive GENPOWER TECHNOLOGIES: Voluntary Chapter 11 Case Summary GLOBAL SHIP: Inks New Time Charters for Two Containerships GREENFIELD ETHANOL: S&P Alters Ratings Outlook to Negative GUIDED THERAPEUTICS: Agrees with FDA on Plan for LuViva HARPER BRUSH: Committee Taps Freeborn & Peters as Counsel HAWAIIAN TELCOM: Bid to Withdraw Reference in Ruley Suit Due Nov. HAWKER BEECHRAFT: Judge Holds Back Decision on Bonus Plan HAWKER BEECHCRAFT: Machinists to Block Excessive Bonuses for Exec HOVNANIAN ENTERPRISES: S&P Alters Ratings Outlook to Positive HUGHES TELEMATICS: Completes Merger with Verizon Telematics ICONIC IMPORTS: Bankr. Pending Discharge, Says Parent INTERNATIONAL HOME: Court OKs $250,000 Loan from Principal INTERPOOL INC: S&P Assigns B+ Corp. Credit Rating; Outlook Stable KINGSBURY CORP: Brendan Recupero Withdraws as Committee's Counsel KMC REAL ESTATE: Plan of Reorganization Confirmed KNOTT'S INTERIORS: Case Summary & 20 Largest Unsecured Creditors KNOWLEDGE UNIVERSE: S&P Lowers Issuer Credit Ratings to 'CCC' LACK'S STORES: Landlord, Not Assignee, Can File Rejection Claim LEHMAN BROTHERS: Files Updated Cash Flow Estimates LEE'S FORD: Court Approves DelCotto Law Group as Counsel LEVEL 3: Lowers Second Quarter Net Loss to $62 Million LIBORIO MARKETS: Judge Converts Chapter 11 Case to Chapter 7 LIGTHSQUARED INC: Final Order for $41 Million DIP Loan Entered MAXUM PETROLEUM: S&P Puts 'B' Corp. Credit Rating on Watch Pos MIRAGE BOTTLING: Case Summary & 20 Largest Unsecured Creditors MORGAN INDUSTRIES: Court Approves $2-Million BofA Financing MPG OFFICE: R. Maguire Redeems 3.9 Million Partnership Units MTS GOLF: U.S. Bank Won't Consent to Cash Collateral Use MTS GOLF: Sec. 341 Creditors' Meeting Set for Aug. 21 MUSCLEPHARM CORP: Board of Directors Expanded to 5 Members NASHVILLE BILTMORE: Files for Chapter 11 Bankruptcy Protection NAKNEK ELECTRIC: Has $6 Million Loan to Fund Fuel Purchase NATIONAL HOLDINGS: Receives Add'l $2 Million Financing from NSGP NET TALK.COM: Extends Maturity of Senior Debentures to 2013 NEW YORK TIMES: S&P Revises Outlook on 'B+' CCR to Stable NORTEL NETWORKS: CCAA Stay Period Extended to Oct. 31 OAJ LLC: Chapter 11 Case Summary & Unsecured Creditor OSI RESTAURANT: Estimates Revenue of $980.9MM in Second Quarter OSI RESTAURANT: Commences Tender Offer for 10% Senior Notes PENN TREATY: Board Approves Changes to Directors' Compensation PHILADELPHIA NEWSPAPERS: Defamation Claimants Lose 3rd Cir. Fight PINNACLE AIRLINES: Taps Deloitte Tax to Provide Advisory Services POLYMER GROUP: Moody's Affirms 'B1' CFR/PDR; Outlook Stable PORTER BANCORP: Incurs $319,000 Net Loss in Second Quarter PORTER BANCORP: Names John Taylor President and CEO of PBI Bank PREFERRED FINANCIAL: Case Summary & 20 Largest Unsecured Creditors PREMIER PAVING: Court Grants Short Exclusivity Extension QPL INC: Case Summary & 20 Largest Unsecured Creditors QUALTEQ INC: Case Trustee May Expand Scope of Crowe Horwath's Work QUALTEQ INC: Case Trustee Taps Hilco as Real Estate Advisors QUANTUM FUEL: Sells $1.9 Million Bridge Notes to Investors QUICKSILVER RESOURCES: Moody's Cuts Corp. Family Rating to 'B2' R.E. LOANS: Plan of Reorganization Declared Effective RANCHER ENERGY: Posts $882,900 Net Loss in Fiscal 2012 REAL ESTATE: Voluntary Chapter 11 Case Summary REGAL ENTERTAINMENT: Reports $37.2 Million Net Income in Q2 RHODE ISLAND STUDENT: Moody's Lifts Ratings on 12 Bond Classes ROCHA DAIRY: Court Continues Hearing on Dismissal Bid to September RG STEEL: Willkie Farr Bills $1.35-Mil. for A Month's Work RITZ CAMERA: Taps David Angress to Provide Consulting Services RITZ CAMERA: Taps Kurtzman Carson to Provide Admin. Services RITZ CAMERA: Taps SSG Capital as Exclusive Investment Banker RITZ CAMERA: Winthrop Couchot Tapped as California Counsel RIVER-BLUFF ENTERPRISES: Sec. 341 Creditors' Meeting on Aug. 27 RIVER-BLUFF ENTERPRISES: Status Conference Set for Aug. 29 RYLAND GROUP: Reports $6.0 Million Net Income in Second Quarter SAN JUAN BAUTISTA MEDICAL: Suit v Power Operator Goes to Trial SPRINT NEXTEL: Incurs $1.4 Billion Net Loss in Second Quarter SEQUENOM INC: Incurs $29.6 Million Net Loss in Second Quarter STEREOTAXIS INC: Regains Compliance with Min. Bid Price Rule ROSETTA GENOMICS: Signs Co-Marketing Agreement with Precision SHUANEY IRREVOCABLE: Court OKs Motion to Prohibit Cash Collateral SJJ CORP: Case Summary & 20 Largest Unsecured Creditors SUNCOKE ENERGY: S&P Puts 'BB-' Corp. Credit Rating on Watch Neg TOWNSEND CORP: Plan Filing Deadline Extended to Oct. 3 TRAC INTERMODAL: Moody's Assigns B1 CFR, Rates 2nd Lien Notes B3 TXCO RESOURCES: Wins $15MM Judgment Against Peregrine Petroleum UNION CENTER: Case Summary & 8 Unsecured Creditors USEC INC: Dr. Joyce Brown Resigns from Board of Directors USG CORP: Incurs $57 Million Net Loss in Second Quarter VALENCE TECHNOLOGY: Shareholders Accuse Berg of Power Grab VALERO ENERGY: Moody's Issues Summary Credit Opinion VIASPACE INC: Fails to Reach Deal on VGE Separation VOLKSWAGEN-SPRINGFIELD: Trustee to Name Consumer Privacy Ombudsman VOLKSWAGEN-SPRINGFIELD: Court Approves Wiley Rein as Counsel VOLKSWAGEN-SPRINGFIELD: Marcher OK'd as Financial Consultant WAGSTAFF MINNESOTA: Has Until Oct. 30 to Propose Ch. 11 Plan WARNER SPRINGS: Opposes Pala Tribe's Chapter 7 Conversion Bid WARNER SPRINGS: Court OKs CBRE Inc. as Real Estate Broker WARNER SPRINGS: Court OKs OFKMJ Corbin as Accountants WASHINGTON MUTUAL: Liquidating Trust to Distribute $74 Million WHITE BEAUTY: Case Summary & 20 Largest Unsecured Creditors W.R. GRACE: Chapter 11 Emergence to Depend on Waiver Satisfaction W.R. GRACE: Net Income Drops 8.6% to $69.3 Million YUKOS OIL: Tribunal Orders Russian Government to Pay Investors ZALE CORP: Secures $665 Million Credit Facility * One Exchange Appoints Ken Freda as Chief Operating Officer * Large Companies With Insolvent Balance Sheet ********* 1301 INVESTMENTS: Case Summary & 10 Unsecured Creditors ------------------------------------------------------- Debtor: 1301 Investments, LLC 8390 SW 5th Street Miami, FL 33144 Bankruptcy Case No.: 12-27990 Chapter 11 Petition Date: July 26, 2012 Court: United States Bankruptcy Court Southern District of Florida (Miami) Judge: Laurel M. Isicoff Debtor's Counsel: Juan C. Zorrilla, Esq. ZORILLA & ASSOCIATES, PL 1401 Brickell Ave #570 Miami, FL 33131 Tel: (305) 860-3831 E-mail: jcz@zgolaw.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 unsecured creditors is available for free at http://bankrupt.com/misc/flsb12-27990.pdf The petition was signed by Julio Piloto, managing member. 237 EAST: Seeks Plan Extension as Counsel Busy With Another Case ---------------------------------------------------------------- 237 East Ontario LLC filed a motion seeking an extension until Aug. 2, 2012, of its deadline to file the Second Amended Disclosure Statement and Second Amended Plan of Reorganization. The Debtor requested that the Court extend its filing period because lead counsel, Neal L. Wolf has been busy with ALT Hotel, LLC's confirmation hearing. The brief extension would enable Mr. Wolf to meet with the Debtor, discuss the Second Amended Plan, and thereafter amend and file the same. The Debtor related that at the July 19, 2012 hearing, the Debtor was required to amend and file by July 26, a second amended disclosure statement and plan based upon the executed purchase agreement with the purchaser. The real estate sale and purchase agreement between the Debtor and the purchaser provides for the sale of the property for $7,000,000. The price is sufficient to retire the indebtedness owing to the Debtor's secured lender Podco 237 Ontario LLC, and pay all other anticipated claims in full. The First Amended Plan As reported in the Troubled Company Reporter on July 17, 2012, according to the First Amended Disclosure Statement, the Plan provides for the sale of the property to the purchaser -- EasyPark, LLC, a real estate developer and property holding company. The purchase price for the sale of the property under the letter of intent is sufficient to pay all allowed claims in full, even if Disputed Claims are subsequently allowed. The proceeds from the sale of the property will be the only source of funding for the Plan. Under the Plan, all allowed claims will be paid in full at the closing. The Plan also provides that holders of equity interest in the Debtor will be paid the net sale proceeds at the closing. As reported in the Troubled Company Reporter on May 4, 2012, the plan does not provide for the sale of the property pursuant to Section 363 of the Bankruptcy Code because the proceeds from the sale are sufficient to pay all claims against the estate in full, even if disputed claims are allowed in full. The Plan instead provides for the conventional sale of the property -- a real estate commonly known as 237 East Ontario Street, Chicago, Illinois 60611, which is valued at $9 million and secures ad mortgage to Podco 237 Ontario LLC of $964,000 A copy of the First Amended Disclosure Statement is available for free at http://bankrupt.com/misc/237_EAST_ds_1amended.pdf About 237 East Ontario LLC 237 East Ontario LLC, a single asset real estate under 11 U.S.C. Sec. 101(51B), filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 11-49504) on Dec. 9, 2011. Judge Carol A. Doyle presides over the proceeding. The Debtor is represented by Neal Wolf & Associates, LLC. On Jan. 13, 2012, the Debtor disclosed total assets of $11.06 million and total of $8.31 million. The Debtor's liquidating plan provides for the distribution of proceeds among creditors and equity holders form the sale of the Debtor's property to EasyPark, LLC. The plan does not provide for the sale of the property pursuant to Section 363 of the Bankruptcy Code because the proceeds from the sale are sufficient to pay all claims against the estate in full, even if disputed claims are allowed in full. The Plan instead provides for the conventional sale of the property to the purchaser. 400 BLAIR: Wells Fargo Permitted to Foreclose --------------------------------------------- The Hon. Michael B. Kaplan of the U.S. Bankruptcy Court for the District of New Jersey denied 400 Blair Realty Holdings, LLC's motion to reinstate the automatic stay. The Court ordered that Wells Fargo is permitted to immediately take any actions necessary or appropriate to complete the foreclosure action pending in the United States District Court, District of New Jersey, except that the foreclosure sale in the foreclosure action may not take place prior to May 2, 2012. About 400 Blair Realty Holdings 400 Blair Realty Holdings, LLC, in Morristown, New Jersey, was formed in June 2000 to acquire real property improved with 181,000 sq. ft industrial building situated on 14.7 acres located at 400 Blair Road, Carteret, Middlesex County, New Jersey. The Property was acquired on Aug. 6, 1999. United States Land Resources, L.P., holds a 50% equity interest in 400 Blair. USLR's general partner is United States Realty Resources, Inc., and Lawrence S. Berger is the president of USRR. 400 Blair's other member is Success Treuhand GmbH, which holds a 50% equity interest. Success is a trust set up under German law. Success operates much like a United States trust company. Success' sole owner is Eckart Straub, a German national. 400 Blair filed for Chapter 11 bankruptcy (Bankr. D. N.J. Case No. 11-37887) on Sept. 23, 2011, after a court appointed a receiver for its property and ordered a foreclosure sale. Judge Michael B. Kaplan presides over the case. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by Lawrence S. Berger, manager. The Debtor's bankruptcy counsel is Morris S. Bauer, Esq., at Norris McLaughlin & Marcus, PA, in Bridgewater, New Jersey. 8 MILE: Chapter 11 Case Summary & 4 Unsecured Creditors ------------------------------------------------------- Debtor: 8 Mile Ranch, LLC 5400 Eight Mile Ranch Road St. Cloud, FL 34773 Bankruptcy Case No.: 12-10227 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Middle District of Florida (Orlando) Debtor's Counsel: Richard B Webber, II, Esq. ZIMMERMAN KISER & SUTCLIFFE PA 315 East Robinson Street, Suite 600 Orlando, FL 32801 Tel: (407) 425-7010 Fax: (407) 425-2747 E-mail: rwebber@zkslawfirm.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of Company's list of its four unsecured creditors is available for free at http://bankrupt.com/misc/flmb12-10227.pdf The petition was signed by Reuben Joseph O'Berry, managing member. AGY HOLDING: Decides to Initiate Process to Sell CFM Business ------------------------------------------------------------- AGY Holding Corp. has decided to initiate the process to sell its continuous filament mat business. "This decision regarding our CFM business was made to better align the company's strategic objectives and product portfolio," said Drew Walker, President of AGY. The proposed sale will have no impact on AGY's core yarn and specialty roving business. Re-aligning its product portfolio will allow AGY to return to its core capabilities and focus on its specialty materials products. "AGY has the product portfolio and technology to take advantage of continued acceptance of our products as replacements for more traditional materials, such as metal and wood," said Walker. "In this regard, the composites industry has a strong, proven track record for high-volume usage." AGY anticipates selling the CFM plant and facilities in Huntingdon Pennsylvania that make up the CFM business, including the wound products and conductive roving business. Since acquiring the plant in 2007, AGY has profitably produced the unique glass fiber product used in the production of electrical insulation panels, pultruded shapes for industrial products, energy market products for power generation and oil rig safety, and composite parts for automotive interiors. AGY will continue operating the plant until a transaction is completed. While the CFM product line and its customer base are no longer core to AGY's strategic business plan for the future, AGY has every confidence that it is poised for growth. "AGY CFM is a solid business," said Walker. "We believe the business will benefit from being owned by a company aligned with its objectives." About AGY Holding AGY Holding Corp. -- http://www.agy.com/-- produces fiberglass yarns and high-strength fiberglass reinforcements used in composites applications. AGY serves a range of markets including aerospace, defense, electronics, construction and industrial. Headquartered in Aiken, South Carolina, AGY has a European office in Lyon, France and manufacturing facilities in the U.S. in Aiken, South Carolina and Huntingdon, Pennsylvania and a controlling interest in a manufacturing facility in Shanghai, China. AGY Holding reported a net loss of $66.76 million in 2011, a net loss of $14.57 million in 2010, and a net loss of $93.51 million in 2009. The Company's balance sheet at March 31, 2012, showed $232.85 million in total assets, $280.34 million in total liabilities and a $47.49 million total shareholders' deficit. * * * As reported by the TCR on Nov. 23, 2011, Moody's Investors Service lowered AGY Holding Corporation's (AGY) Corporate Family Rating (CFR) to Caa2 from B3, reflecting the decline in the company's liquidity and weak operating performance. In the Dec. 5, 2011, edition of the TCR, Standard & Poor's Ratings Services lowered its corporate credit rating on Aiken, S.C.-based AGY Holding Corp. (AGY) to 'CCC-' from 'CCC+'. "Our rating action reflects our view that AGY's credit quality has deteriorated due to ongoing weakness in its operating performance, a decline in liquidity, and the potential for insufficient liquidity to meet interest payments in 2012. As of Sept. 30, 2011, the company reported total liquidity of $17 million including $16.2 million of availability under its unrated revolving credit facility. AGY reported that it expected liquidity to decline to levels of around $12.4 million in November following the payment of nearly $10 million in semiannual interest on its notes. It also expects effective availability to be lower than the reported figures, because the company is also subject to a fixed-charge coverage ratio covenant if availability under its revolving credit facility declines to below $6.25 million. We do not expect to be in compliance if the covenant becomes applicable. Current liquidity levels have declined from our expectations of a minimum liquidity of $20 million at the previous rating. Key credit risks, in our view, are liquidity insufficient to meet requirements (including approximately $20 million in future interest payments in 2012). An additional risk is potential liquidity requirements possibly arising from the put option available with the seller of AGY Hong Kong Ltd. for the remaining 30% of the company not yet purchased by AGY. The put option can be exercised through Dec. 31, 2013. AGY reports a fair value of about $0.23 million for the remaining 30% of the AGY Hong Kong Ltd. as of Sept. 30, 2011 -- a decline from an initial estimated value of about $12 million in 2009. AGY Hong Kong also has about $10.5 million of debt, which the company reports it is trying to extend, and approximately $11.5 million in annually renewable working capital facilities due in 2012 (debt at AGY Hong Kong is nonrecourse to AGY)," S&P said. ALMA ROSA: Case Summary & 6 Unsecured Creditors ----------------------------------------------- Debtor: Alma Rosa Winery & Vineyards, LLC 7250 Santa Rosa Road Buellton, CA 93427 Bankruptcy Case No.: 12-12837 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Central District of California (Santa Barbara) Judge: Robin Riblet Debtor's Counsel: Peter Susi, Esq. SUSI & GURA, A PROFESSIONAL CORP 7 W Figueroa 2nd Flr Santa Barbara, CA 93101-3191 Tel: (805) 965-1011 Fax: (805) 965-7351 E-mail: cheryl@susigura.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 unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb12-12837.pdf The petition was signed by J. Richard Sanford, manager. AMERICAN AIRLINES: Has Deal With American Eagle Flight Attendants ----------------------------------------------------------------- American Eagle Flight Attendants, represented by the Association of Flight Attendants-CWA, disclosed a tentative agreement after months of negotiations between AFA and American Eagle management. Once approved by union leadership, the agreement will provide Flight Attendants with the opportunity to vote on whether to ratify the agreement instead of being subject to the bankruptcy court's imposition of terms dictated by management. "Our AFA negotiations team has worked tirelessly to mitigate very onerous concessionary demands by management. Over the past four months, we have been able to stave off drastic concessions which would have decimated the pay and work rules of American Eagle Flight Attendants," said Robert Barrow, AFA American Eagle President. "This is certainly not the agreement we were negotiating prior to the bankruptcy, nor does it accurately reflect the vast contributions American Eagle Flight Attendants make to our carrier each day. However, this agreement blunts management's most onerous demands, gives us the opportunity to decide for ourselves how to move forward, and provides a foundation for the future." The AMR Corporation, parent company of American Eagle and American Airlines, filed for bankruptcy protection in November 2011. AFA leadership at American Eagle has been fully engaged in responding to the bankruptcy filing and, along with financial and legal advisors, remains committed to defending Flight Attendant rights throughout the process. The Association of Flight Attendants is the world's largest Flight Attendant union. Focused 100 percent on Flight Attendant issues, AFA has been the leader in advancing the Flight Attendant profession for over 65 years. Serving as the voice for Flight Attendants in the workplace, in the aviation industry, in the media and on Capitol Hill, AFA has transformed the Flight Attendant profession by raising wages, benefits and working conditions. Nearly 60,000 Flight Attendants at 21 airlines come together to form AFA, part of the 700,000-member strong Communications Workers of America (CWA), AFL-CIO. About American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMWEST IMAGING: Posts $201,000 Net Loss in May 31 Quarter --------------------------------------------------------- Amwest Imaging Incorporated filed its quarterly report on Form 10-Q, reporting a net loss of $201,050 on $1,358 of sales for the three months ended May 31, 2012, compared with a net loss of $15,000 on $0 sales for the three months ended May 31, 2011. The Company's balance sheet at May 31, 2012, showed $1.10 million in total assets, $327,993 in total current liabilities, and stockholders' equity of $775,222. As reported in the TCR on July 5, 2012, Peter Messineo, CPA, in Palm Harbor, Florida, expressed substantial doubt about Amwest Imaging's ability to continue as a going concern, following the Company's results for the fiscal year ended Feb. 29, 2012. Mr. Messineo noted that the Company has not generated significant revenues from operations and is requiring traditional financing or equity funding to commence its operating plan. A copy of the Form 10-Q is available for free at: http://is.gd/Mnn1Iy Evansville, Indiana-based Amwest Imaging Incorporated is a technology company whose primary business is providing relationship-building tools and processes that help any business cultivate profitable relationships with customers, all through web based solutions. The Company's current portfolio consists of My Restaurant Web (www.myrestaurantweb.com), Lok Drop (www.LokDrop.com), Zip Clik (www.ZipClik.com). ARCTIC GLACIER: H.I.G. Capital Buys Arctic Glacier Income Fund -------------------------------------------------------------- H.I.G. Capital, LLC disclosed that an affiliate completed the acquisition of substantially all the assets of Arctic Glacier Income Fund. The transaction was effectuated pursuant to the Companies' Creditors Arrangement Act (Canada) and the U.S. Bankruptcy Code. The new company, Arctic Glacier Holdings, Inc. ("Arctic Glacier" or the "Company"), will be based in Winnipeg, Canada, and will continue to conduct business under the "Arctic Glacier" name. Arctic Glacier is a leading producer, marketer and distributor of high-quality packaged ice. The Company is the largest producer of packaged ice in Canada and the second largest producer in the United States. Arctic Glacier operates a network of 39 production plants and 48 distribution facilities and services more than 75,000 retail locations. The Company also provides ice in bulk quantities to industrial and commercial customers. Keith McMahon, President and CEO of Arctic Glacier commented, "The acquisition by H.I.G. provides stability and positions Arctic Glacier for growth. We look forward to carrying on our proud tradition of product quality and service excellence. We wish to thank our customers, suppliers and employees for their support throughout this process." "We are very excited about the Arctic Glacier opportunity," added Bret Wiener, a Managing Director of H.I.G. Capital. "The Company is a market leader with a diversified customer base, broad geographic footprint and high quality production and distribution assets. We see tremendous opportunities in the business and look forward to supporting Keith and the Arctic team." About Arctic Glacier Winnipeg, Canada-based Arctic Glacier Inc., et al., manufacture packaged ice for distribution in Canada and the United States. On Feb. 22, 2012 Arctic Glacier Income Fund, together with its subsidiaries, initiated proceedings in the Manitoba Court of Queens Bench seeking a court supervised recapitalization under the Companies' Creditors Arrangement Act. Concurrently, Philip J. Reynolds of Alvarez & Marsal Canada Inc., as monitor and foreign representative, filed Chapter 15 petitions for Arctic Glacier, et al. (Bankr. D. Del. Lead Case No. 12-10603) on Feb. 22, 2012. Bankruptcy Judge Kevin Gross presides over the case. Mr. Reynolds is represented by Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, LLP. The Debtors is estimated to have assets and debts at $100 million to $500 million. BONAVIA TIMBER: Plan Confirmed After Deal With Secured Creditor --------------------------------------------------------------- U.S. Bankruptcy Judge Ranll L. Dunn this month entered an order confirming the Joint Plan of Reorganization of Bonavia Timber Company, LLC, and Nevada First Corp. The judge confirmed the Plan after the Debtors reached a settlement with Third Eye Capital Corporation, as agent for Strative Capital, Ltd., the lone objector to the Plan. According to the July 16 confirmation order, unsecured creditors voted in favor of the Plan. Holders of the unsecured claims will be paid in cash the full amount of the claims no later than six months after the Effective Date, with interest from the Petition Date at the Federal Judgment Rate. Existing interests in the Debtor will be preserved. Pursuant to the settlement, Third Eye, holder of a secured claim, will receive * a note that requires the Debtor to pay Third Eye $6.1 million on or before Aug. 1, 2012. Any balance of the remaining unpaid on Aug. 2, 2012, will accrue interest at an effective rate equal to 20% per annum to and including December 1, 2012. Thereafter, any unpaid balance will accrue interest at an effective rate equal to 60% per annum and will be due and payable in full on June 1, 2015. The Debtor's obligations to Third Eye will be secured by security interests in and liens on the real property located in Umatilla County, Oregon. * a note that requires the Debtor to pay: (i) $1 million to Pacific time on Dec. 2, 2012; (ii) $1.4 million from Dec. 2, 2012, through 12:01 a.m. Pacific time on June 2, 2013; (iii) $1.8 million from June 2, 2013 through 12:01 a.m. Pacific time on Dec. 2, 2013; (iv) $2.2 million from Dec. 2, 2013, through 12:01 a.m. Pacific time on June 2, 2014; (v) $2.6 million from June 2, 2014, through 12:01 a.m. Pacific time on Dec. 2, 2014; (vi) $3 million from Dec. 2, 2014, until paid. With respect to the second note, no interest will accrue or be payable on the unpaid balance until June 2, 2015. Any unpaid balance remaining as of 12:01 a.m. Pacific time on June 2, 2015, will accrue interest at an effective rate equal to 60% per annum and will be due and payable in full on June 1, 2017. The debt will be secured by a first lien on all of the real property owned by NFC Land & Cattle, LLC, in Nevada, and the real property owned by Bonavia Timber located in Umatilla County, Oregon. The Settlement also provides that Third Eye will cooperate in the closing of the sale of a portion of the Ukiah Property consisting of approximately 1,687 acres to Mike and Cynthia Warn for the purchase price of $1,687,030 and will execute and deliver into the escrow at AmeriTitle in Pendleton, Oregon, any and all release documents that may be reasonably necessary or appropriate to close the Warn Sale. The net proceeds of the Warn Sale will be paid from escrow directly to Third Eye. Third Eye will cooperate with the closing of the loan transaction for $4,500,000 with AXA Equitable AgriFinance, LLC and will execute and deliver into escrow at AmeriTitle in Pendleton, Oregon, any and all release documents with respect to the portion of the Ukiah Property and the Morrow Property that may be reasonably necessary or appropriate to close the AXA Loan. All net proceeds from the AXA Loan will be payable from escrow directly to Third Eye. The confirmation order also approves the Warn Sale and the AXA Loan. In the event either or both the Warn Sale or the AXA Loan do not close, Reorganized Debtor will have the right on or before June 1, 2015, to sell or refinance any remaining portions of the Ukiah Property and the Morrow Property and Third Eye will have the right to either credit bid any unpaid balance of the $6.1 million initial obligation or release its liens in connection with any sale or refinance, and will otherwise cooperate in the closing of any such transactions. A copy of the confirmation order along with the Chapter 11 Plan of Reorganization dated May 30, 2012 is available for free at: http://bankrupt.com/misc/Bonavia_Timber_Plan_Order.pdf Third Eye is represented by: Teresa H. Pearson, Esq. MILLER NASH LLP 111 SW Fifth Avenue, Suite 3400 Portland, OR 97204-3638 Tel: 503-205-2646 Fax: 503-224-0155 E-mail: Teresa.pearson@millernash.com About Bonavia Timber Portland, Oregon-based Bonavia Timber Company LLC, fdba Pacific Northwest Tree Farms LLC, owns over 18,400 acres of timber and pasture land in Umatilla and Morrow Counties, Oregon. Bonavia operates a cattle ranch, grows and sells timber, and leases properties to third parties for grazing and timber operations. Nevada First Corp. is a holding company that owns, among other interests, 100% of the membership interests in Bonavia and 100% of the membership interests in NFC Land & Cattle, LLC, a Nevada limited liability company ("NFC"). Nevada First provides administrative and management services to both Bonavia and NFC. NFC owns approximately 145,000 acres of real property in Nevada. NFC also has over 1,000,000 acres of United States Forest Service and Bureau of Land Management allotments. NFC conducts ranching and farming operations on its properties Bonavia Timber and Nevada First Corp. filed for Chapter 11 bankruptcy (Bankr. D. Ore. Lead Case No. 11-39459) on Nov. 1, 2011. The case has been reassigned to Judge Randall L. Dunn from Judge Trish M. Brown. Albert N. Kennedy, Esq., and Michael W. Fletcher, Esq., at Tonkon Torp, serve as the Debtor's counsel. In its petition, Bonavia Timber estimated assets of $10 million to $50 million. CAESARS ENTERTAINMENT: Amendment to 2012 Incentive Plan Approved ---------------------------------------------------------------- The Executive Committee of the board of directors of Caesars Entertainment Corporation approved by written consent an amendment to the 2012 Performance Incentive Plan to increase the maximum number of shares of the Company's common stock with respect to which stock options and stock appreciation rights may be granted during any calendar year to any individual under the 2012 Plan from 3,433,509 shares to 6,500,000 shares. The full-text copy of the Amendment is available for free at http://is.gd/qTnKMS On July 23, 2012, the holders of a majority of the issued and outstanding voting securities of the Company as of July 16, 2012, the record date established by the Executive Committee of the Board, approved by written consent (1) a one-time stock option exchange program, to permit the Company to cancel certain stock options held by some of its employees, service providers and directors in exchange for new, or replacement, options and (2) the Amendment. On July 24, 2012, in connection with the Written Consent, the Company filed an Information Statement on Schedule 14C with the Securities and Exchange Commission. The Amendment will not be effective prior to the date that is 20 calendar days after the date that the Company mails the Information Statement to its stockholders who did not sign the Written Consent, which mailing is expected to commence on or about July 26, 2012. The Option Exchange will not close, and no replacement options will be granted, until the 20th business day after the Option Exchange commences, unless the Option Exchange is extended by the Company. The Company has filed a Tender Offer Statement on Schedule TO with the SEC relating to the Option Exchange, a copy of which is available for free at http://is.gd/sQZWzV 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. The Company reported 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. CAPITALSOURCE INC: S&P Affirms 'B+/C' Counterparty Credit Ratings ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B+' long-term counterparty credit rating and its 'C' short-term rating on CapitalSource Inc. "We subsequently withdrew the ratings at the company's request. At the time of withdrawal, the outlook was Stable," S&P said. "Our ratings on CapitalSource reflected its liquidating portfolio of legacy nonperforming assets, the long-term credit risk of its lending strategy, and its limited revenue diversification. The company's robust capital and its subsidiary bank's deposit funding and strong pre-provision profitability were positive ratings factors," S&P said. CAROLEE'S PROPERTIES: Case Summary & 2 Unsecured Creditors ---------------------------------------------------------- Debtor: Carolee's Properties, LLC 3300 NE 164th J#1 Ridgefield, WA 98642 Bankruptcy Case No.: 12-45195 Chapter 11 Petition Date: July 26, 2012 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Brian D. Lynch Debtor's Counsel: Timothy J. Dack, Esq. 916 Main St P.O. Box 61645 Vancouver, WA 98666 Tel: (360) 694-4227 E-mail: bkfile@dackoffice.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 two unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb12-45195.pdf The petition was signed by Carol Fox, member. CHARMING SHOPPES: S&P Ups Corp. Credit Rating to 'BB-'; Off Watch ----------------------------------------------------------------- Standard & Poor's Ratings Services raised the corporate credit rating on Bensalem, Pa.-based Charming Shoppes Inc. to 'BB-' from 'B-'. "At the same time, we removed the ratings from CreditWatch with positive implications, where they were placed on May 3, 2012. The outlook is stable. The upgrade reflects the stronger credit profile and resulting higher rating on Ascena Retail Group Inc.," S&P said "We then withdrew the 'B-' issue-level rating and '4' recovery rating on the company's senior convertible notes, which have been purchased from holders as a result of the Ascena acquisition," S&P said. "Following these actions, we withdrew all our ratings on Charming Shoppes, including the 'BB-' corporate credit rating," S&P said. CINRAM INTERNATIONAL: Sale to Najafi Gets U.S. Court Approval ------------------------------------------------------------- Cinram International Income Fund disclosed that the proposed sale of substantially all of Cinram's assets and businesses in the United States, Canada, the United Kingdom, France and Germany to newly formed subsidiaries of Najafi Companies has received U.S. court approval. Under the Sale Transaction announced on June 25, 2012, Najafi will purchase substantially all of the assets used in Cinram's core businesses for the manufacture of pre-recorded multimedia products and the provision of related logistics services, digital media solutions and outsourced vendor management inventory services in North America and substantially all of the European business. The Sale Transaction is expected to close in August 2012, subject to satisfaction of closing conditions, although the transfer of portions of the business may occur later in the year. About Cinram International With headquarters in Toronto, Ontario, Canada, Cinram International Inc. is one of the world's largest independent manufacturers, replicators and distributors of DVDs and audio CDs. Cinram International reached an agreement to sell substantially all of its assets and operations to Najafi Companies for $82.5 million. To implement sale transactions, the Company has filed for reorganization protection under the Companies' Creditors Arrangements Act (Canada) in the Ontario Superior Court. Concurrently with that filing, Cinram's US subsidiaries filed under Chapter 15 of the United States Bankruptcy Code (Bankr. D. Del. Case Nos. 12-11882 to 12-11890). Pauline K. Morgan Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serves as U.S. counsel. FTI Consulting is the monitor in the CCAA case. Attorneys at Goodsman LLP represent Cinram in the CCAA case. CIRCLE ENTERTAINMENT: Borrows $450,000 from Directors, et al. ------------------------------------------------------------- Certain of Circle Entertainment Inc.'s directors, executive officers and greater than 10% stockholders made unsecured demand loans to the Company totaling $450,000, bearing interest at the rate of 6% per annum, On July 20, 2012, through July 25, 2012. The Company intends to use the proceeds to fund working capital requirements and for general corporate purposes. Because certain of the directors, executive officers and greater than 10% stockholders of the Company made the Loans, a majority of the Company's independent directors approved the transaction. About Circle Entertainment Circle Entertainment Inc. (CEXE.PK), formerly FX Real Estate and Entertainment Inc., owns 17.72 contiguous acres of land located at the southeast corner of Las Vegas Boulevard and Harmon Avenue in Las Vegas, Nevada. The Las Vegas Property is currently occupied by a motel and several commercial and retail tenants with a mix of short and long-term leases. On June 23, 2009, as a result of the default under the first mortgage loan, the first lien lenders had a receiver appointed to take control of the property. The Company is headquartered in New York City. The Company's Las Vegas subsidiary filed for Chapter 11 bankruptcy on April 21, 2010, and a plan of liquidation or reorganization will eventually be implemented under which the Company will surrender ownership of the Las Vegas Property. Under such a plan, it is extremely unlikely the Company will receive any material interest or benefit. The Company's balance sheet at March 31, 2012, showed $6.48 million in total assets, $13.72 million in total liabilities, and a $7.23 million total stockholders' deficit. L.L. Bradford & Company, LLC, in Las Vegas, Nevada, expressed substantial doubt about the Company's ability to continue as a going concern following the 2011 financial results. The independent auditors noted that the Company has limited available cash, has a working capital deficiency and will need to secure new financing or additional capital in order to pay its obligations. CIRCLE STAR: To Issue 5.2 Million Common Shares Under 2011 Plan --------------------------------------------------------------- Circle Star Energy Corp. filed with the U.S. Securities and Exchange Commission a Form S-8 registering 5.21 million shares of common stock issuable under the Company's 2011 Stock Option Plan. The proposed maximum aggregate offering price is $2.92 million. A copy of the filing is available for free at http://is.gd/ZvvZEh About Circle Star Houston, Tex.-based Circle Star Energy Corp. owns royalty, leasehold, operating, net revenue, net profit, reversionary and other mineral rights and interests in certain oil and gas properties in Texas. The Company's properties are in Crane, Scurry, Victoria, Dimmit, Zavala, Grimes, Madison, Robertson, Fayette, and Lee Counties. The Company's balance sheet at Jan. 31, 2012, showed $3.91 million in total assets, $6.75 million in total liabilities and a $2.84 million total stockholders' deficit. The Company said in its quarterly report for the period ended Jan. 31, 2012, that there is substantial doubt about its ability to continue as a going concern. The continuation of the Company as a going concern is dependent upon continued financial support from the Company's shareholders, the ability of the Company to obtain necessary financing to continue operations, and the attainment of profitable operations. The Company can give no assurance that future financing will be available to it on acceptable terms if at all or that it will attain profitability. These factors raise substantial doubt about the Company's ability to continue as a going concern. CITY CENTRAL: City Council Wants Receiver Discharged ---------------------------------------------------- The city council on behalf of the City of Central Falls, Rhode Island, asks the U.S. Bankruptcy Court for the District of Rhode Island to: -- discharge the receiver; -- direct it to file a final interim account and report; and -- order the receiver to vacate and surrender the offices of government and prohibit it from taking any further action with respect to the lawful and elected government of the City of Central Falls. According to the city council, by the time of the hearing on the motion on the decision the receiver will have over-stayed its time limit as a change in the form of government as expressed by the Rhode Island Supreme Court of two years, the time limit is set to expire on July 16, 2012. About Central Falls Central Falls is a city in Providence County, Rhode Island. The population was 18,928 at the 2000 census. Central Falls is the smallest and most densely populated city in Rhode Island. Central Falls sought bankruptcy protection under Chapter 9 of the U.S. Bankruptcy Code (Bankr. D. R.I. Case No. 11-13105) on Aug. 1, 2011. The Chapter 9 filing was made after former Rhode Island Supreme Court Judge Robert Flanders, who serves as state-appointed receiver for the city, was unable to negotiate significant concessions from unions representing police officers, firefighters and other city workers. The city grappled with an $80 million unfunded pension and retiree health benefit liability that is nearly quadruple its annual budget of $17 million. Judge Robert Flanders succeeded the role from retired Superior Court Associate Justice Mark A. Pfeiffer, who was appointed in July 2010. The Central Falls receivership, the state's first, has left the mayor and council without any power to govern. Judge Frank Bailey presides over the Chapter 9 case. Theodore Orson, Esq., at Orson and Brusini Ltd., serves as bankruptcy counsel to the receiver. The City of Central Falls, Rhode Island, on July 10, 2012, filed with the Bankruptcy Court a Second Amended Plan For The Adjustment Of Debts and an explanatory disclosure statement. The Chapter 9 Plan, if confirmed, will restructure the City's debt and its operations and put the City on a path towards fiscal stability. The Amended Plan also addresses and resolves the City's obligations to employees, retirees, and vendors. The Amended Plan does not impair the City's bond obligations. CLEARWIRE CORP: Incurs $145.8 Million Net Loss in Second Quarter ---------------------------------------------------------------- Clearwire Corporation reported a net loss attributable to the Company of $145.81 million on $316.93 million of revenue for the three months ended June 30, 2012, compared with a net loss attributable to the Company of $168.73 million on $322.61 million of revenue for the same period during the prior year. The Company reported a net loss attributable to the Company of $327.63 million on $639.57 million of revenue for the six months ended June 30, 2012, compared with a net loss attributable to the Company of $395.69 million on $559.41 million of revenue for the same period a year ago. The Company's balance sheet at June 30, 2012, showed $8.43 billion in total assets, $5.65 million in total liabilities and $2.78 billion in total stockholders' equity. "Every day wireless users become increasingly dependent on their highly capable 4G devices at a time when many in our industry are questioning whether their 4G networks can keep pace," said Erik Prusch, President and CEO of Clearwire. "Network congestion and capacity issues have already forced most major operators to curb usage through data caps or speed limits, and the 4G boom has only just begun. We believe Clearwire's unmatched spectrum portfolio and LTE roadmap are keys to unlocking the value of our deep capacity resources and uniquely position us to meet the short and long term needs of consumers and wholesale carrier partners." A copy of the press release is available for free at: http://is.gd/mORnvs Slade Gorton Named to Board Clearwire Corporation appointed former U.S. Senator Slade Gorton to the Company's board of directors. The appointment is effective immediately. "Slade's decades of experience in business, law and government will bring to Clearwire important leadership in matters of corporate governance, strategy and general business development," said Clearwire executive chairman of the board of directors, John Stanton. "I believe he will be a key voice in helping to guide discussions on the future of our company at this critical time in our history." Mr. Gorton has served as a director of Microvision, Inc., since September 2003 and currently serves as Chairman of the Board and Lead Independent Director. He was recently Of Counsel at the law firm K&L Gates, LLP, and now serves as a consultant to the firm. Prior to joining the firm, he represented Washington State in the United States Senate for 18 years. Mr. Gorton began his political career in 1958 as a Washington State Representative and went on to serve as State House Majority Leader. He served as Attorney General of Washington from 1969 - 1981, and during that time argued 14 cases before the United States Supreme Court. After leaving the Senate, he served as a Commissioner on the National Commission on Terrorist Attacks upon the United States; as a member of the National War Powers Commission; and is Co-Chairman of the National Transportation Policy Project. He also served in the U.S. Army, U.S. Air Force, and the U.S. Air Force Reserves. About Clearwire Corporation Kirkland, Wash.-based Clearwire Corporation (NASDAQ: CLWR) -- http://www.clearwire.com/-- through its operating subsidiaries, is a provider of 4G mobile broadband network services in 68 markets, including New York City, Los Angeles, Chicago, Dallas, Philadelphia, Houston, Miami, Washington, D.C., Atlanta and Boston. The Company reported a net loss attributable to the Company of $717.33 million in 2011, a net loss attributable to the Company of $487.43 million in 2010, and a net loss attributable to the Company of $325.58 million in 2009. * * * As reported by the TCR on Nov. 25, 2011, Standard & Poor's Ratings Services lowered its corporate credit and senior secured first- lien issue-level ratings on Bellevue, Wash.-based wireless provider Clearwire Corp. to 'CCC' from 'CCC+'. "The downgrade reflects our concerns that the company may choose to skip its $237 million of interest payments due on Dec. 1, 2011," explained Standard & Poor's credit analyst Allyn Arden. "With about $698 million of cash on the balance sheet, Clearwire has sufficient funds to pay the remaining interest expense due in 2011, although Standard & Poor's believes that it would still have to raise significant capital to maintain operations in 2012 despite the cost-reduction measures it has already achieved. If Clearwire elected to make the interest payment, we believe that it would exit 2011 with around $350 million to $400 million in cash, which assumes less than $100 million of capital expenditures and EBITDA losses. We do not believe that this cash balance will be sufficient to cover free operating cash flow (FOCF) losses and a Long-Term Evolution (LTE) wireless network overlay in 2012 and that the company will require additional funding during the year." COPPERAS CREEK: Debt Buyer Fails in Bid to Dismiss Bankruptcy Case ------------------------------------------------------------------ Bankruptcy Judge Robert H. Jacobvitz denied the request of CO Acquisition Property III LLC for dismissal of the Chapter 11 bankruptcy case of Copperas Creek, LLC, for alleged bad faith and for failure to file schedules of assets and liabilities and statement of financial affairs. According to the Court, the evidence presented to the Court fails to establish that Copperas Creek filed its petition in bad faith. In addition, although the Debtor failed to file its Schedules and Statement of Financial Affairs within the extended time requested in its motion, under the circumstances of the case, that failure does not constitute cause for dismissal. A copy of the Court's July 26, 2012 Memorandum Opinion is available at http://is.gd/LxO5AWfrom Leagle.com. Based in Albuquerque, New Mexico, Copperas Creek, LLC, filed a voluntary Chapter 11 petition (Bankr. D. N.M. Case No. 12-11839) on May 9, 2012. Don F. Harris, Esq., serves as the Debtor's counsel. In its petition, the Debtor estimated under $10 million in both assets and debts. The petition was signed by Jeannie Duncan, sole member and sole officer. The debtor's principal, Jeannie Duncan, is the sole member and sole officer of Copperas Creek. Copperas Creek is a real estate holding company that does not have any employees or otherwise conduct business. Certain real property located at 5401 San Diego Road NE and 5301 San Diego Road NE constitutes all or substantially all of the Debtor's assets. A commercial building is situated on 5401 San Diego Road NE. There are two tenants in the commercial building located at 5401 San Diego Road NE. The tenants are businesses owned directly or indirectly by Ms. Duncan. Copperas Creek has not collected rent from its tenants in the last year. The real property located at 5301 San Diego Road NE is undeveloped property. In 2007, Copperas Creek executed a Promissory Note in favor of First Community Bank in the principal amount of $1,194,000. The Note is secured by a Mortgage on the Property and by a lien against all leases for the Property and rents. At some time after Copperas Creek executed the loan documents in favor of First Community Bank, the Federal Deposit Insurance Corporation caused the closure of First Community Bank. In September 2011, CO Acquisition Property III purchased the loan secured by the Property, including the Note, Mortgage, and commercial guaranty, at a discount from the bank that acquired the assets of First Community Bank. CO Acquisition is in the business of purchasing distressed debt. CO Acquisition's business model includes a quick liquidation of collateral it acquires to maximize the return to its investors. Matt Walsh, an asset manager for Republic Financial Corporation in Aurora, Colorado, of which CO Acquisition is an affiliate, testified that CO Acquisition is in the business of purchasing distressed loans and typically purchases loans at a discount at an average "somewhere south of fifty percent" for all purchased loans. CO Acquisition is, by far, Copperas Creek's largest creditor. CO Acquisition initiated foreclosure proceedings against Copperas Creek in state court prior to the filing of the bankruptcy petition. A hearing on CO Acquisition's motion to appoint Roger Cox & Associates Property Management LLC as receiver was scheduled in the state court foreclosure action on May 10, 2012. Copperas Creek filed its bankruptcy petition one day before the scheduled hearing date. Prior to the filing of the bankruptcy, Ms. Duncan and CO Acquisition had been negotiating in an attempt to reach a settlement, but negotiations ultimately failed. Ms. Duncan testified that she caused Copperas Creek to file its bankruptcy petition because she believed she "was left with no other choice." Copperas Creek did not file its Schedules and Statement of Financial Affairs with its petition. On May 24, 2012, the Debtor filed a motion seeking extension of the filing deadline to May 30, 2012. As of the date of the first meeting of creditors, held on June 11, 2012, the Debtor had not filed its Schedules or Statement. The United States Trustee conducted the meeting of creditors on June 11, and then adjourned the meeting to June 14. At the meeting of creditors held June 11, the United States Trustee agreed on the record to an extension of time for the Debtor to file its Schedules and Statement of Financial Affairs until June 14 at 8:00 a.m. CO Acquisition attended the meeting of creditors on June 11 and extensively questioned the Debtor's designated representative, and attended the continued meeting held on June 14. The Debtor and the United States Trustee submitted a proposed stipulated order extending the deadline for the Debtor to file its Schedules and Statement of Financial Affairs to June 13, which the Court determined should be treated as a motion to extend the time, subject to notice and a hearing, in light of the pending Motion to Dismiss filed by CO Acquisition. The Debtor filed an Amended Voluntary Petition, Schedules and Statement of Financial Affairs on June 13. Copperas Creek valued the Property in its schedules as follows: $1,200,000 Mixed Use Office and Warehouse Building located at 5401 San Diego (Lot 29); $275,000 Vacant Land located at 5301 Sand Diego Road NE (Lot 30) Prior to the filing of the bankruptcy case, Copperas Creek listed the Property for sale with a commercial real estate broker in February 2012. The listing price is $1,544,636. The commercial building located at 5401 San Diego is priced at $94 per square foot for a total sales price of $1,237,980 and the vacant land located at 5301 San Diego is priced at $8 per square foot for a total sales price of $306,656. Maestas & Ward is the listing agent for the Property and has agreed to a 6% commission on the sale of the Property. As currently marketed, the vacant land can be sold separately from the commercial property. Martha Carpenter, a top producing commercial real estate broker at Maestas & Ward, is acting as sales broker and listing agent for the Property. Copperas Creek has not received any written offers to purchase the Property at the listing price or any other price, but Ms. Carpenter reported that she continues to actively show the Property. In her opinion, she believes that the Property can be sold at the current listing price in a reasonable time, but that it could take an additional six months to sell the Property. In her experience, she generally markets a property for at least six months before reevaluating the listing price. As of the date of the hearing, the Property has been on the market for nearly six months. At some point, if the Property does not sell, the listing price will need to be reassessed. Brian Anderson, Chief Operating Officer and qualifying broker for Roger Cox & Associates Property Management, LLC, testified that in his opinion a reasonable listing price and market value for the Property is $925,000. Mr. Anderson holds a Certified Commercial Investment Member designation, but it is not a qualified appraiser. Mr. Anderson established his estimated listing price and market value by reviewing comparable properties that have sold within the 6- to 12-month period preceding the date of his report. He obtained the sales information by contacting one MAI certified appraiser and requesting a list of sold properties. Mr. Anderson testified that he made adjustments to the comparable sales, but did not specify what adjustments he made to the comparable properties in reaching his estimate of value for the Property. In his opinion, at the current listing price, the Property is unlikely to sell for at least 18 months, but at his suggested listing price of $925,000, the Property should sell within six months. Copperas Creek scheduled CO Acquisition's claim as a secured claim of $1,300,000. Copperas Creek has not made any payments on the loan that CO Acquisition acquired since June 2011. Ms. Duncan testified that Copperas Creek made payments on the loan before CO Acquisition acquired the loan that have not been credited to the loan, and estimates that the amount of the debt to CO Acquisition is "in the neighborhood" of $1,300,000. CO Acquisition presented a loan history it obtained when it purchased the loan but did not present evidence about its accuracy. CO Acquisition has begun to charge interest at the default rate of 9.5%. At the default rate, the loan accrues monthly interest in the approximate amount of $10,400, assuming an unpaid principal balance of $1,312,948.38. CO Acquisition has not filed a proof of claim in the Debtor's bankruptcy case. Larry J. Montano, Esq. -- lmontano@hollandhart.com -- at Holland & Hart, LLP, represents CO Acquisition Property III, LLC. CORNERSTONE BANCSHARES: Posts $311,000 Net Income in 2nd Quarter ---------------------------------------------------------------- Cornerstone Bancshares, Inc., reported net income of $310,585 million on $4.81 billion of total interest income for the three months ended June 30, 2012, compared with net income of $141,287 on $5.15 million of total interest income for the same period during the prior year. The Company reported net income of $667,102 on $9.44 million of total interest income for the six months ended June 30, 2012, compared with net income of $393,562 on $10.37 million of total interest income for the same period a year ago. The Company's balance sheet at June 30, 2012, showed $420.87 million in total assets, $384.11 million in total liabilities and $36.75 million in total stockholders' equity. "The Directors are extremely pleased with the strong, positive strides made in every segment of the Bank's operations," said Cornerstone's Board Chairman Miller Welborn. "We have a solid team in place and will continue to work diligently to strengthen the Bank's foundations, in order to continue serving our customers and this thriving Chattanooga market." A copy of the press release is available for free at: http://is.gd/okfbkS About Cornerstone Bancshares Chattanooga, Tenn.-based Cornerstone Bancshares, Inc., is a bank holding company. Its wholly-owned subsidiary, Cornerstone Community Bank, is a Tennessee-chartered commercial bank with five full-service banking offices located in Hamilton County, Tennessee. Cornerstone reported net income of $1.03 million in 2011, compared with a net loss of $4.70 million in 2010. Cornerstone said in its 2011 annual report that as of Dec. 31, 2011, the Company had one loan, currently being serviced by Midland Loan Services for the FDIC, which totaled approximately $3 million. The loan contains certain compliance covenants which include stated minimum or maximum target amounts for Cornerstone's capital levels, the Bank's capital levels, nonperforming asset levels at the Bank and the ability of Cornerstone to meet the required debt service coverage ratio, which is computed on the four most recent consecutive fiscal quarters. Due to the level of nonperforming assets of the Bank and not currently meeting the required debt service coverage ratio, Cornerstone was not in compliance with these two covenants at Dec. 31, 2011. However, Cornerstone had previously obtained waivers through Dec. 31, 2011. During March 2012, Cornerstone obtained from the FDIC a waiver of the covenant compliance requirements through Dec. 31, 2012, granted that all payments are made in accordance with the aforementioned repayment schedule. However, if the Company is unable to comply with those covenants or obtain an additional waiver from the lender for violations that occur after Dec. 31, 2012, if any, the lender may declare the loan in default and take possession of the Bank's common stock. If this event were to occur, Cornerstone's assets and operations would be substantially reduced and therefore its ability to continue as a going concern would be in substantial doubt. Consent Order The Company disclosed in the Form 10-Q for the quarter ended June 30, 2010, that following the issuance of a written report by the Federal Deposit Insurance Corporation and the Tennessee Department of Financial Institutions concerning their joint examination of Cornerstone Community Bank in October 2009, the Bank entered a consent order with the FDIC on April 2, 2010, and a written agreement with the TDFI on April 8, 2010, each concerning areas of the Bank's operations identified in the report as warranting improvement and presenting substantially similar plans for making those improvements. The consent order and written agreement, which the Company collectively refers to as the "Action Plans", convey specific actions needed to address certain findings from the joint examination and to address the Company's current financial condition. The Action Plans contain a list of strict requirements ranging from a capital directive, which requires the Company to achieve and maintain minimum regulatory capital levels in excess of the statutory minimums to be well-capitalized, to developing a liquidity risk management and contingency funding plan, in connection with which the Company will be subject to limitations on the maximum interest rates it can pay on deposit accounts. The Action Plans also contain restrictions on future extensions of credit and requires the development of various programs and procedures to improve the Company's asset quality as well as routine reporting on its progress toward compliance with the Action Plans to the Board of Directors, the FDIC and the TDFI. As of April 2, 2010, the date of the Action Plans, the Bank was deemed to be "adequately capitalized." CRET RESTORATION: Files List of Largest Unsecured Creditors ----------------------------------------------------------- CRET Restoration Inc. filed with the U.S. Bankruptcy Court for the District of Maryland a list of holders of largest unsecured claims: Entity Nature of Claim Claim Amount ------ --------------- ------------ M. Evelyn Jones Location: 7220 $660,000 1921 Tulip Street, NW Livingston Road, (unknown Washington, DC 20012 Fort Washington secured) MD 20744. 650,000 Approximately 19 senior acres on lien) undeveloped real property TrustCapital Investments, LLC Location: 7220 $650,000 3 Bethesda Metro Center Livingston Road, (Unknown Bethesda, MD 20817 Fort Washington secured) MD 20744. Approximately 19 acres on undeveloped real property NKB Investment Group Money Loaned $320,000 3333 7th Street, NE Washington, DC 20032 Prince George's County Location: 7220 $6,019 c/o Meyer, Rodbell & Rosenbaum, PA Livingston Road, (Unknown 6801 Kenilworth Avenue, Suite 400 Fort Washington (1,312,845 Riverdale, MD 20737 MD 20744 senior lien) Approximately 19 acres on under developed real property Prince George's County Location: 7220 $962 c/o Meyer, Rodbell & Rosenbaum, PA Livingston Road, (Unknown 6801 Kenilworth Avenue, Suite 400 Fort Washington (1,311,882 Riverdale, MD 20737 MD 20744 senior lien) Approximately 19 acres on under developed real property Prince George's County Location: 7220 $1,882 c/o Meyer, Rodbell & Rosenbaum, PA Livingston Road, (Unknown 6801 Kenilworth Avenue, Suite 400 Fort Washington (1,310,000 Riverdale, MD 20737 MD 20744 senior lien) Approximately 19 acres on under developed real property A Powell Management, LLC $136,000 1414 Gordon School Road Thomaston, GA 30286 CDM Associates, Inc. $104,000 11785 Beltsville Drive, Suite 1620 Beltsville, MD 20705 Joyce Engineering $81,000 10766 Baltimore Avenue Beltsville, MD 20705 Law Offices of Darryl A. $30,000 Kelley & Assoc. 6944 Allentown Road Camp Springs, MD 20748 KCI Engineering $14,000 936 Ridgebrook Road Sparks, MD 21152 Calvary Portfolio Services, $11,077 LLC 500 Summit Lake Drive, Suite 400 Valhalla, NY 10595 IRS $6,699 Centralized Insolvency Section P.O. Box 21126 (DP-N-781) Philadelphia, PA 19144 IRS $6,786 Centralized Insolvency Section P.O. Box 21126 (DP-N-781) Philadelphia, PA 19144 Evergreen Ventures, LLC Unknown 7815 Broadleaf Drive Parsonsburg, MD 21849 About CRET Restoration CRET Restoration Inc., based in Fort Washington, Maryland, was placed in involuntary Chapter 11 bankruptcy (Bankr. D. Md. Case No. 12-10648) by creditors M. Evelyn Jones, A Powell Management LLC, CDM Associates Inc., and NKB Investment Group on Jan. 13, 2012. Judge Wendelin I. Lipp presides over the case. CRET RESTORATION: Files Schedules of Assets and Liabilities ----------------------------------------------------------- CRET Restoration Inc. filed with the Bankruptcy Court for the District of Maryland its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property Unknown 19-acre undeveloped property 7220 Livingston Road, Fort Washington, Md. B. Personal Property $0 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $1,318,864 E. Creditors Holding Unsecured Priority Claims $6,699 F. Creditors Holding Unsecured Non-priority Claims $702,863 ----------- ----------- TOTAL Unknown $2,028,427 A full-text copy of the schedules of assets and liabilities is available free at http://bankrupt.com/misc/CRET_sal.pdf CRET Restoration Inc., based in Fort Washington, Maryland, was placed in involuntary Chapter 11 bankruptcy (Bankr. D. Md. Case No. 12-10648) by creditors M. Evelyn Jones, A Powell Management LLC, CDM Associates Inc., and NKB Investment Group on Jan. 13, 2012. Judge Wendelin I. Lipp presides over the case. CUSTER ROAD: To Present Plan for Confirmation on Sept. 27 --------------------------------------------------------- Custer Road Marketplace, Ltd., will ask Judge Brenda T. Rhoades to confirm its Chapter 11 plan at a hearing on Sept. 27 at 10:00 a.m. Objections to confirmation of the Plan are due Aug. 31, and ballots accepting or rejecting the Plan are due Sept. 7, 2012, according to the July 13 order approving the Disclosure Statement. As reported in the June 6, 2012 edition of the Troubled Company Reporter, the Plan allows the Debtor to obtain a loan secured by lots 2 and 4 of the Debtor's real property. These lots have a value of approximately $5,700,000. The Debtor anticipates obtaining a loan secured by these lots in an amount in excess of $4,000,000. If the Debtor obtains such a loan, the proceeds will be used to pay the Class 4 claim of Tax Ease Funding, L.P. in the amount of $616,494, in full, to pay the Class 2 secured tax claims in full with respect to taxes assessed against the remaining CRM Property and the balance paid as a partial payment on the Class 3 secured claim of Legacy Texas Bank, a fully secured creditor. The Debtor scheduled the claim of Legacy at $16,320,565 on the Petition Date. If CRM or Reorganized CRM does not obtain the Plan Loan, the Class 3 Claim will be paid in full on the Effective Date by the transfer by special warranty of title to the Legacy Property from CRM to Legacy in full and final payment of any and all Claims of Legacy. Each holder of general unsecured claims is impaired under the Plan. Each Holder of an Allowed Class 5 general unsecured claim will receive cash equal to the amount of the claim of payable from a pro rata share of $5,000 each month until those claims are paid. Holders of interests are unimpaired under the Plan. A copy of the Disclosure Statement dated May 4, 2012, is available for free at http://bankrupt.com/misc/CUSTER_DS.pdf About Custer Road Custer Road Marketplace, Ltd. owns 53 acres of real property known as Custer Road Marketplace in Collin County, Texas. Ross Helbing has appraised the property at $22,700,000. The slowdown in the U.S. economy resulted in the inability of CRM to develop and sell the property as initially anticipated and prevented the Debtor from paying or re-financing a secured loan. Custer Road Marketplace filed for Chapter 11 bankruptcy (Bankr. E.D. Tex. Case No. 12-40312) on Feb. 7, 2012, estimating $10 million to $50 million in assets and debts. Richard W. Ward, Esq., serves as the Debtor's bankruptcy counsel. Judge Brenda T. Rhoades presides over the case. In its schedules, the Debtor disclosed $23,183,800 in total assets and $19,257,403 in total liabilities. DAVITA INC: S&P Affirms 'BB-' Corp. Credit Rating; Outlook Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating on Denver-based DaVita Inc. The rating outlook is stable. "We lowered our rating on DaVita's senior secured debt to 'BB-', the same as the corporate credit rating, from 'BB', and removed it from CreditWatch, where it was placed with negative implications on May 22, 2012, following the acquisition announcement," S&P said. "We lowered the rating because the size of this debt class will increase substantially relative to our estimate of the enterprise's value in the event of default," said Standard & Poor's credit analyst Gail Hessol. "We revised our recovery rating on this debt to '3', indicating our expectation for meaningful (30% to 50%) recovery of principal in the event of payment default, from '2', indicating an expectation for substantial (70% to 90%) recovery." "We assigned our 'BB-' credit rating, the same as the corporate credit rating, to DaVita's proposed $1,350 million term loan A-3 due 2017 and $1,650 million term loan B-2 due 2019. We assigned our '3' recovery rating to this debt, indicating our expectation for meaningful (30% to 50%) recovery of principal in the event of payment default," S&P said. "We affirmed our 'B' rating, two notches below the corporate credit rating, on DaVita's senior unsecured debt. We affirmed our '6' recovery rating on this debt, indicating our expectation for negligible (0 to 10%) recovery of principal in the event of payment default," S&P said. "The rating on Denver-based DaVita Inc. reflects its 'aggressive' financial risk profile (according to our criteria), distinguished by robust discretionary cash flow, which will enable fairly rapid deleveraging following its acquisition of HCP. We estimate pro forma adjusted debt to EBITDA is about 4.5x, compared with DaVita's actual adjusted leverage of 3.7x as of March 31, 2012. Our adjustments include the capitalization of operating leases; we add stock compensation to EBITDA; and we deduct net income attributable to noncontrolling interests (NCIs) from EBITDA when measuring leverage. We believe DaVita's acquisition of HCP does not alter its 'fair' business risk profile because DaVita will remain substantially dependent on the treatment of a single disease and its exposure to potential adverse changes in reimbursement may be compounded by the addition of HCP to its business portfolio. Its fair business risk profile also recognizes positive attributes of the dialysis sector, such as steady demand from patients with end-stage renal disease for essential dialysis treatments. Both the dialysis and HCP businesses benefit from favorable demographic trends and relatively low investment requirements," S&P said. DAZ VINEYARDS: Taps Casterline as Counsel in Pacific Funding Case ----------------------------------------------------------------- DAZ Vineyards, LLC, sought and obtained approval from the U.S. Bankruptcy Court to employ David Casterline as special counsel related to a state action against Pacific Funding Group and Gary Petruska. Mr. Casterline does not represent any interest adverse to the Debtor's estate, except that David Casterline also represents insiders John Zahoudanis, C. Alexis Zahoudanis, and Centrium Associates in this same litigation. Any fees sought from the estate will reflect a division among various represented entities. No retainer has been paid by the Debtor in the case. About DAZ Vineyards Los Olivos, California-based DAZ Vineyards, LLC, a producer of grapes and manufacturer and seller of fine wines doing business as Demetria Estate Winery, filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 10-10689) on Feb. 15, 2010. William C. Beall, Esq., at Beall and Burkhardt, serves as the Debtor's bankruptcy counsel. In its schedules, the Debtor disclosed $32,071,232 in assets and $11,418,337 in liabilities. DELCOR USA: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Delcor USA, Inc. fka Delta Engineering Corp. c/o CSC Corporation 211 East 7th Street, Suite 620 Austin, TX 78701 Bankruptcy Case No.: 12-11671 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: Craig A. Gargotta Debtor's Counsel: Michael S. Held, Esq. HUNTON & WILLIAMS LLP 1445 Ross Ave., Suite 3700 Dallas, TX 75202-2799 Tel: (214) 468-3334 Fax: (214) 468-3599 E-mail: mheld@hunton.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 is available for free at http://bankrupt.com/misc/txwb12-11671.pdf The petition was signed by Keith H. Cole, president. DEX ONE: Reports $52.9 Million Net Income in Second Quarter ----------------------------------------------------------- Dex One Corporation reported net income of $52.90 million on $334.50 million of net revenue for the three months ended June 30, 2012, compared with a net loss of $602.10 million on $377.30 million of net revenue for the same period a year ago. The Company reported net income of $110.50 million on $678.90 million of net revenue for the six months ended June 30, 2012, compared with a net loss of $546.70 million on $768.50 million of net revenue for the same period during the prior year. The Company's balance sheet at June 30, 2012, showed $3.03 billion in total assets, $2.93 billion in total liabilities, and $103.60 million in shareholders' equity. "We remain focused on transforming Dex One into a leading marketing services company," said Alfred Mockett, Dex One CEO. "Our performance in the quarter demonstrates our efforts are paying off." "The successful execution of our debt retirement and great support from lenders as part of the buyback was a critical component of our strategy," said Dex One CFO Greg Freiberg. "We will continue to reduce costs, while making targeted investments to drive digital growth." A copy of the press release is available for free at: http://is.gd/8QjWwG About Dex One Dex One, headquartered in Cary, North Carolina, is a local business marketing services company that includes print directories and online voice and mobile search. Revenue was approximately $1.1 billion for the LTM period ended Sept. 30, 2010. R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media East LLC, Dex Media West LLC and Dex Media Inc., filed for Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09- 11833 through 09-11852). They emerged from bankruptcy on Jan. 29, 2010. On the Effective Date and in connection with its emergence from Chapter 11, RHD was renamed Dex One Corporation. Dex One reported a net loss of $518.96 million in 2011 compared with a net loss of $923.59 million for the eleven months ended Dec. 31, 2010. * * * 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. DIVERSINET CORP: Incurs $1.1-Mil. Net Loss in Second Quarter ------------------------------------------------------------ Diversinet Corp. reported its second quarter 2012 results for the period ended June 30, 2012. Revenues for the second quarter of 2012 increased 217% to US$419,000 from US$132,000 in the same year-ago period. Revenues for the six months ended June 30, 2012, increased 22% to US$701,000 from US$576,000 in the same period in 2011. Revenues in the second quarter of 2012 included US$185,000 from the Company's license and reseller agreement with Mihealth Global Systems and US$75,000 from the University of Nebraska. Net loss in the second quarter totaled US$1.1 million or US$(0.03) per share, improving from US$1.7 million or US$(0.04) per share in the same year ago period. Net loss for the six months ended June 30, 2012, was US$2.6 million, or US$(0.06) per share, improving from US$2.8 million or US$(0.07) per share in the first six months of 2011. Cash and cash equivalents were US$5.1 million at June 30, 2012, compared to US$7.4 million at Dec. 31, 2011. "Our second quarter growth was the result of our renewed focus on creating, on behalf of our clients, more effective patient engagement and care coordination using our MobiSecure(R) technology," said Dr. Hon Pak, interim Chief Executive Officer. "The improvement in revenue reflects the strong leverage in our model and the value we?ve created in our intellectual property." The Company's balance sheet at June 30, 2012, showed US5.5 million in total assets, US$749,699 in total current liabilities, and total shareholders' equity of US$4.8 million. A copy of the press release for the quarter ended June 30, 2012, is available for free at http://is.gd/CXtM9D About Diversinet Corp. Toronto, Ontario-based Diversinet Corp. (TSX Venture: DIV, OTC BB: DVNTF) provides patented and proven secure products that enable healthcare organizations to rapidly deploy HIPAA-compliant mobile healthcare (mHealth) applications to power care coordination. * * * KPMG LLP, in Toronto, Canada, expressed substantial doubt about Diversinet's ability to continue as a going concern, following the Company's results for the fiscal year ended Dec. 31, 2011. The independent auditors noted that the Company incurred a significant loss from operations and used significant amounts of cash in operating activities during 2011. DUNKIN' BRANDS: Share Repurchase Won't Affect Moody's 'B2' CFR -------------------------------------------------------------- Moody's Investors Service said Dunkin' Brands, Inc.'s ratings are unaffected by the company's July 26, 2012 announcement that its Board of Directors authorized a $500 million share repurchase program effective over two years, and that the company plans to potentially upsize its first lien term loan by $400 million to approximately $1.9 billion. The company intends on using proceeds from the proposed incremental term loan to return capital to shareholders as well as for general corporate purposes. The incremental term loan is available to be drawn during a specified time period, concurrent with potential share repurchases. The B2 rating and stable outlook are unaffected at this time due to Moody's expectation for continued gradual improvement in credit metrics over the next twelve to eighteen months despite persistently weak consumer spending, as the company continues to focus on adding stores, introducing new products, and lowering costs. Debt will continue to be reduced through scheduled mandatory payments. The stability associated with Dunkin' Brands' franchise-based business model also provides ratings support, as it is less capital intensive and insulated from earnings volatility related to commodity fluctuations. Further, the company's liquidity is expected to remain good, supported by the expectation that cash, operating cash flow and excess revolver availability will be more than sufficient to support all internal cash requirements including mandatory debt amortization and capital expenditures over the next 12 -- 15 months. Dunkin' Brands' ratings are as follows: -- B2 Corporate Family Rating; -- B3 Probability of Default Rating; -- B2 (LGD 3, 33%) $100 million guaranteed senior secured revolver due 2015; -- B2 (LGD 3, 33%) $1.9 billion guaranteed senior secured term loan B, including the potential $400 million incremental term loan; -- SGL-2 Speculative Grade Liquidity rating Dunkin' Brands' ratings have been assigned by evaluating factors that Moody's believes are relevant to the company's risk profile, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside Dunkin' Brands' core industry. Dunkin' Brands' ratings are believed to be comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Dunkin' Brands franchises over 17,000 quick service restaurants under the brand names Dunkin' Donuts and Baskin-Robbins. The company owns and operates only a very small number of its own stores. Revenue for the latest twelve months exceeded $650 million, although system-wide sales are greater than $8.5 billion. DZ.EYE.N STUDIOS: Hires Cox Smith Matthews as Attorneys ------------------------------------------------------- Dz.eye.n Studios, LLC, d/b/a Boss Creative, asks permission from the U.S. Bankruptcy Court to employ Cox Smith Matthews Incorporated as attorneys. Thomas Rice, Esq., will lead the Cox Smith team. The Debtor's lead counsel can be reached at: Thomas Rice, Esq. COX SMITH MATTHEWS INCORPORATED 112 East Pecan Street, Suite 1800 San Antonio, TX Tel: (210) 554-5500 Fax: (210) 226-8395 E-mail: trice@coxsmith.com The Debtor attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Cox Smith received a $20,000 retainer from Boss Creative. Cox Smith may from time to time request that the Debtor provide additional amounts as retainer. The firm's hourly rates are: Professional Rates ------------ ----- Thomas Rice, Shareholder $395 Meghan E. Bishop, Associate $330 Allison C. Seifert, Paralegal $160 About Boss Creative An involuntary Chapter 11 case was filed against DZ.EYE.N Studios, LLC (Bank. W.D. Tex. Case No. 12-51861) on June 8, 2012, by Angel Staffing. The petitioning creditor, which asserts a $425,000 claim for an unpaid loan, also filed a motion for a trustee to take over the Debtor's estate. Dz.eye.n Studios, doing business as Boss Creative, continues to manage and operate its business. Boss Creative is a San Antonio- Texas based provider of innovative web, print, search engine optimization and logo design. Boss Creative's in-house developers and programmers promise visually stunning, effective and engaging websites that drive industry standards. ENNIS COMMERCIAL: Wells Fargo Has Plan for Owner Ben Ennis ---------------------------------------------------------- Wells Fargo Bank N.A. this month filed a proposed plan of liquidation for debtor Ben A. Ennis. Mr. Ennis, according to Wells Fargo, appears to owe over $70 million on his loan guarantees. Mr. Ennis was a successful real estate developer who owned many commercial real estate properties through a number of entities. After the real estate market crash, many of Mr. Ennis' creditors started to enforce guaranties given by Mr. Ennis -- which prompted Mr. Ennis to seek bankruptcy. Wells Fargo, holder of a third of the unsecured claims against Ennis, filed a liquidating plan under which a "plan administrator" will be appointed to collect and liquidate all of the Debtor's assets, including assets Mr. Ennis transferred to his wife before bankruptcy. The Plan administrator will take over management of the estate from Terrence long, who was named Chapter 11 trustee in May 2011. The intended duration of the Plan is one to two years. Mr. Ennis less than a month before filing for bankruptcy signed a "post-nuptial agreement" with his spouse, Roberta, under which he transferred to Roberta 30 real properties and a dozen on-and off- road vehicles. There was a deal reached in May 2011 under which Roberta agreed to return the properties to the original transferors. But the deal was not approved by the judge after objections filed by creditors. Under the Plan proposed by the Wells Fargo, administrative claims, professional fee claims, and priority tax claims are unimpaired and will be paid in full. Secured creditor Rabobank, N.A., owed $361,000 in principal, is also unimpaired. With respect to alleged secured claims of (a) Keith Watkins, who has a scheduled claim of $2.4 million and (b) Daryl C. Nicholson and related entities, which have estimated claims of $2.4 million, the plan administrator will file not later than 90 days after the effective date of the Plan an objection to the claims. If the bankruptcy court determines that the claim is valid and secured, the administrator will have the option of (a) satisfying the claim according to the terms thereof as determined by the bankruptcy court (b) abandoning real property securing the claim to the claimant, and (c) selling the property and paying the payoff release price. Watkins and Nicholson are impaired under the Plan. Wells Fargo, owed the principal of $3.056 million secured by lien covering multiple parcels of real property, will be unimpaired. The Plan provides that the plan administrator is authorized to pay all payments required under the note and deeds of trust but will have the option of not paying any or all of the claims. Rabobank and other holders of secured claims are also unimpaired under the Plan. They will be deemed to accept the Plan. Holders of unsecured claims will receive a distribution in the range of less than 1% to 9.7% of their allowed claims, depending on a number of factors. Unsecured claims total approximately $75 million and are based on loan guarantees. The claims in this class will likely decrease as holders of the claims realize upon their collateral. Unsecured creditors will be required to file proofs of claim within 90 days after the effective date of the Plan. With respect to Mr. Ennis's rights, the plan administrator will abandon or pay the value of the properties items claimed exempt by Mr. Ennis. Mr. Ennis is impaired and, like the unsecured creditors, will be entitled to vote on the Plan. According to Wells Fargo, Citizens Business Bank is expected to file a separate Chapter 11 plan for Ennis Commercial Properties, LLC. It is expected that the ECP Plan will proceed toward confirmation at the same time as the Ennis Plan. Wells Fargo says that in a Chapter 7 liquidation scenario, the sales price for the real estate assets would be 15% lower than they would be under the Plan. The liquidation analysis projects that distributions to unsecured creditors in a Chapter 7 liquidation will be 0.9% to 6.3%. A copy of the Wells Fargo Disclosure Statement is available for free at http://bankrupt.com/misc/Ben_Ennis_Wells_Fargo_DS.pdf About Ennis Commercial Porterville, California-based Ennis Commercial Properties, LLC's business consists of acquiring raw land and building commercial developments. The Company then either operates or sells the commercial buildings comprising the commercial development. ECP is owned by Ben Ennis, Brian Ennis and Pamela Ennis, in equal shares. On Sept. 20, 2010, Pam Ennis and Brian Ennis transferred all of their ownership interests in ECP to Ben Ennis. ECP filed for Chapter 11 bankruptcy protection (Bankr. E.D. Calif. Case No. 10-12709) on March 16, 2010. Peter L. Fear, Esq., and Gabriel J. Waddell, Esq., at the Law Offices of Peter L. Fear, in Fresno, Calif., represent the Debtor as counsel. No creditors committee has been formed in this case. In its schedules, the Debtor disclosed $40,878,319 in assets and $43,922,485 in liabilities. Ben Ennis filed a voluntary petition under Chapter 11 (Bankr. E.D. Calif. Case No. 10-62315) on Oct. 25, 2010. On May 25, 2011, Terence Long was appointed as Chapter 11 Trustee in the Benn Ennis bankruptcy. The Trustee thus stands in the shoes of Ben Ennis. Consequently, the Trustee holds all of the membership interests in ECP and controls it accordingly. Justin D. Harris, Esq., at Motschiedler, Michaelides, Wishon, Brewer & Ryan, LLP, in Fresno, represents the Chapter 11 Trustee as counsel. EXPERT CAR: Case Summary & 4 Unsecured Creditors ------------------------------------------------ Debtor: Expert Car Washes, Inc. 12681 West Washington Boulevard Los Angeles, CA 90066 Bankruptcy Case No.: 12-35754 Chapter 11 Petition Date: July 26, 2012 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Thomas B. Donovan Debtor's Counsel: Michael Jay Berger, Esq. LAW OFFICES OF MICHAEL JAY BERGER 9454 Wilshire Blvd 6th Fl Beverly Hills, CA 90212-2929 Tel: (310) 271-6223 Fax: (310) 271-9805 E-mail: michael.berger@bankruptcypower.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 four largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb12-35754.pdf The petition was signed by Scott Arditi, vice president. FLEXIBLE WHIPS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Flexible Whips of Tennessee, Inc. 6341 Highway 41A South Pleasant View, TN 37146 Bankruptcy Case No.: 12-06826 Chapter 11 Petition Date: July 26, 2012 Court: United States Bankruptcy Court Middle District of Tennessee (Nashville) Judge: Marian F. Harrison Debtor's Counsel: John C McLemore, Esq. GARFINKLE MCLEMORE & YOUNG PLLC P.O. Box 158249 Nashville, TN 37215-9848 Tel: (615) 383-9495 Fax: (615) 292-9848 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/tnmb12-06826.pdf The petition was signed by Joyce J. Meadows, president/CEO. Affiliate that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- Robert Wayne Meadows and Joyce Johnson Meadows 12-06825 FLORIDIAN VEST: Case Summary & 16 Unsecured Creditors ----------------------------------------------------- Debtor: Floridian Vest, LLC 6111 Peachtree Industrial Road Suite B102 Atlanta, GA 30328 Bankruptcy Case No.: 12-68616 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: J. Carole Thompson Hord, Esq. John A. Christy, Esq. SCHREEDER, WHEELER & FLINT, LLP 1100 Peachtree Street, NE, Suite 800 Atlanta, GA 30309-4516 Tel: (404) 954-9858 Fax: (404) 681 1046 E-mail: chord@swfllp.com jchristy@swfllp.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 16 unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ganb12-68616.pdf The petition was signed by Stanley R. Bullington, manager. Affiliates that filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- Northwest Atlanta Vest, LLC 12-66726 07/02/12 Peachtree Industrial Vest, LLC 12-66735 07/02/12 GATZ PROPERTIES: Sec. 341 Creditors' Meeting Set for Aug. 24 ------------------------------------------------------------ The U.S. Trustee for Region 2 will convene a Meeting of Creditors under 11 U.S.C. Sec. 341(a) in the Chapter 11 case of Gatz Properties LLC on Aug. 24, 2012, at 9:00 a.m. at Room 562, 560 Federal Plaza, Central Islip, New York. Gatz Properties LLC filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 12-74493) on July 20, 2012, in Central Islip, New York, estimating less than $50 million in assets and less than $10 million in liabilities. Bankruptcy Judge Alan S. Trust serves as the Debtor's counsel. Salvatore LaMonica, Esq., at LaMonica Herbst and Maniscalco, in Wantagh, New York, serves as counsel. Gatz Properties and Auriga Capital Corp. formed Peconic Bay LLC for the purpose of holding a long-term leasehold in a property owned by the Gatz family. Peconic Bay took out a $6 million note to finance the construction of Long Island National Golf Course, a first-rate Robert Trent Jones, Jr.-designed golf course. The Gatz family formed Gatz Properties to hold title to the property. The property was leased to Peconic Bay under a Ground Lease dated Jan. 1, 1998. The lease has an initial term for 40 years. On March 31, 1998, Peconic Bay entered into a sublease with American Golf Corp., which was at the time one of the largest golf course operators in the country. American Golf never operated the Course at a profit, later let the Course fall into disrepair, and exercised the early termination option in 2010. William Gatz orchestrated an auction without a broker, and Gatz Properties was the only bidder. Gatz, following the sham auction, took control of the golf course. GAVILON GROUP: S&P Keeps 'BB' Corp. Cedit Rating on Watch Positive ------------------------------------------------------------------ Standard & Poor's Ratings Services said its ratings on Omaha-based The Gavilon Group LLC, including the 'BB' corporate credit rating, remain on CreditWatch with positive implications, following an internal review of the corporate credit rating, including the company's liquidity position. The ratings were originally placed on CreditWatch with positive implications on May 30, 2012, following Tokyo-based Marubeni Corp.'s (BBB/Negative/--) May 2012 announcement that it will buy Gavilon for $3.6 billion excluding debt. Gavilon Group had reported debt outstanding of $2.1 billion as of March 31, 2012. "The CreditWatch update acknowledges our continued belief that Gavilon's credit profile will improve following its proposed acquisition by Marubeni," said Standard & Poor's credit analyst Chris Johnson. "Still, we believe Gavilon's earnings will remain pressured in the near term primarily because of weakness in the company's more volatile energy business segment, which we estimate may lead to EBITDA covenant cushion falling below 10% in the coming quarters. Therefore, we have revised our liquidity profile for Gavilon to 'less than adequate' from 'adequate.'" GENPOWER TECHNOLOGIES: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: Genpower Technologies, LLC 826 W. Royal Oak Court Farmington, UT 84025 Bankruptcy Case No.: 12-29676 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Judge: Joel T. Marker Debtor's Counsel: Amy L. Butters, Esq. LAW OFFICE OF AMY L. BUTTERS 101 North Fort Lane, Suite 104 Layton, UT 84041 Tel: (801) 513-3328 Fax: (858) 430-3442 E-mail: amy@butterslaw.com Scheduled Assets: $1,004,353 Scheduled Liabilities: $443,682 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Kirk E. Jenkins, president. GLOBAL SHIP: Inks New Time Charters for Two Containerships ----------------------------------------------------------- Global Ship Lease, Inc., has signed new time charters with CMA CGM for two 4,113 TEU containerships, the 1996-built Ville d'Aquarius and the 1997-built Ville d'Orion. The vessels will be chartered for approximately eight months at a rate of $9,962 per vessel per day, commencing upon expiration of the current time charters on Sept. 20 and 21, 2012, respectively. Ian Webber, Chief Executive Officer of Global Ship Lease, said, "We are pleased to have signed new time charters for these two ships with CMA CGM. These agreements are consistent with our strategy of operating our fleet of 17 vessels on fixed rate contracts in order to continue to generate predictable and stable results. With these two new contracts, our fleet continues to be fully time chartered until at least May next year with an average remaining term of 6.6 years, or 7.9 years weighted by TEU capacity, representing $1.1 billion of contracted revenue." Mr. Webber continued, "During a challenging market, we are pleased to have secured ongoing employment for these vessels into Second Quarter 2013. This period typically represents the high season for chartering activity and enhances the subsequent remarketing prospects for the two vessels. The seamless transition from current to new charters with CMA CGM ensures that we will not experience any offhire days, incur any costs associated with repositioning these vessels or pay any third party brokerage fees." The time charters for the Ville d'Aquarius and the Ville d'Orion were executed under an agreement entered into with CMA CGM, providing Global Ship Lease with the option to obligate CMA CGM to charter the vessels at an index-linked rate, with a floor of $8,500 per day. As part of this agreement, the Company will accelerate the redemption of 63 Series A Preferred Shares of $48,000 each from CMA CGM for $3,024,000. The redemption is to be funded by restricted cash, which can only be used for this purpose, since the proceeds resulted from the exercise of warrants in 2008. These 63 Preferred Shares were originally scheduled for redemption on Aug. 14, 2016. About Global Ship Lease London, England-based Global Ship Lease (NYSE: GSL, GSL.U and GSL.WS) -- http://www.globalshiplease.com/-- is a containership charter owner. Incorporated in the Marshall Islands, Global Ship Lease commenced operations in December 2007 with a business of owning and chartering out containerships under long-term, fixed rate charters to world class container liner companies. Global Ship Lease owns 17 vessels with a total capacity of 66,297 TEU with a weighted average age at June 30, 2010, of 6.3 years. All of the current vessels are fixed on long-term charters to CMA CGM with an average remaining term of 8.6 years. The Company has contracts in place to purchase two 4,250 TEU newbuildings from German interests for approximately $77 million each that are scheduled to be delivered in the fourth quarter of 2010. The Company also has agreements to charter out these newbuildings to Zim Integrated Shipping Services Limited for seven or eight years at charterer's option. As reported in the Dec. 1, 2012, edition of the TCR, Global Ship Lease disclosed that it had entered into an agreement with its lenders to waive until Nov. 30, 2012, the requirement under its credit facility to conduct loan-to-value tests. The credit facility requires that loan-to-value, which is the ratio of outstanding borrowings under the credit facility to the aggregate charter-free market value of the secured vessels, cannot exceed 75%. The Company's balance sheet at March 31, 2012, showed US$937.52 million in total assets, US$595.25 million in total liabilities and US$342.26 million in total stockholders' equity. GREENFIELD ETHANOL: S&P Alters Ratings Outlook to Negative ---------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Toronto- based ethanol producer GreenField Ethanol Inc. (GFE) to negative from stable. "At the same time, Standard & Poor's affirmed its 'B+' long-term corporate credit rating on the company," S&P said. "The negative outlook reflects our concerns of refinancing risk related to GreenField's debt maturity in January 2014 and declining headroom under the covenants in 2013," said Standard & Poor's credit analyst Jatinder Mall. "There is also significant execution risk related with the company's capital expenditure on several new projects to offset declining EBITDA contributions from government subsidies." "The rating on GFE reflects Standard & Poor's view of the company's weak business risk profile and aggressive financial risk profile. GreenField relies on government subsidies for a significant (about 70%) amount of its EBITDA generation and we expect these subsidies to start declining at the end of 2012, stopping by the end of 2016. Furthermore, the company is exposed to commodity price volatility in its ethanol business, and faces hedging risks associated with its commodity risk. Standard & Poor's believes that offsetting these weaknesses somewhat are GFE's long-term customer contracts within its fuel ethanol business, and strong market positions within the Canadian fuel ethanol and North American industrial alcohol industry," S&P said. GFE produces industrial and beverage alcohol, fuel ethanol, and distillers' grains that it sells largely to North American customers. The company's four manufacturing plants are in Ontario and Quebec and are capable of producing more than 600 million liters of fuel ethanol and industrial alcohol per year. GFE sells about 75% of its total production as fuel ethanol to Ontario- and Quebec-based oil refiners. Its beverage and industrial alcohol business operates three alcohol packaging plants based in Canada and the U.S., serving more than 6,000 customers. "The negative outlook reflects our concerns of refinancing risk related to GreenField's debt maturity in January 2014 and declining headroom under the covenants in 2013. There is also significant execution risk related with the company's capital expenditure on several new projects to offset declining EBITDA contributions from government subsidies," S&P said. "We could lower the rating if GFE is unable to refinance 2014 debt maturities by early 2013, covenant headroom declines to below 10%, or the industry experiences sustained crush spreads of less than 50 Canadian cents per gallon leading to profitability being lower than our expectations. We do not expect to revise the outlook to stable in the next year, given declining subsidies and heavy capital expenditure on new projects that is likely to deteriorate liquidity. However, we would consider a stable outlook if the company is able to refinance debt, improve cushion under covenants, fund growth capital expenditures, and mitigate declining EBITDA with the cash flows from new projects," S&P said. GUIDED THERAPEUTICS: Agrees with FDA on Plan for LuViva ------------------------------------------------------- Guided Therapeutics, Inc., met with the Food and Drug Administration on July 20, 2012. The company believes the meeting was very positive and plans to work with FDA to finalize the path forward to gain premarket approval for the LuViva Advanced Cervical Scan, a non-invasive device used to detect cervical disease that leads to cancer, instantly and at the point of care. The preliminary plan calls for the Company to file a PMA amendment using existing clinical data to address the agency's questions stemming from its Jan. 20, 2012, "not approvable" letter. The Company maintained at the meeting with the FDA that the new data analysis to be included in the amended PMA demonstrates the clinical benefit of LuViva in light of new cervical cancer screening guidelines adopted earlier this year. "We are pleased with both the tenor and substance of the meeting with FDA and believe we have a good plan to move the PMA process forward through what we hope will be a quick review and approval for LuViva," said Mark L. Faupel, Ph.D., President and CEO of Guided Therapeutics. "We believe that once approved, LuViva will have a very positive impact on the U.S. healthcare system by improving the standard of care for the early detection of cervical disease, and providing women and doctors the first test with instant results." LuViva has been under FDA PMA review since Sept. 23, 2010. The company received a "not approvable" letter for the product on Jan. 20, 2012. In May, 2012 the company requested a meeting with the agency, and suggested a path for possible approval to which the FDA was receptive. After a PMA amendment is submitted, the FDA has 180 days during which it can respond. In addition to the recently announced CE Mark, LuViva has marketing approval from Health Canada. Guided Therapeutics was awarded ISO 13485 certification in January, 2011. The company continues to anticipate a launch in international markets later in 2012. About Guided Therapeutics Guided Therapeutics, Inc. (OTC BB and OTC QB: GTHP) -- http://www.guidedinc.com/-- is developing a rapid and painless test for the early detection of disease that leads to cervical cancer. The technology is designed to provide an objective result at the point of care, thereby improving the management of cervical disease. Unlike Pap and HPV tests, the device does not require a painful tissue sample and results are known immediately. GT has also entered into a partnership with Konica Minolta Opto to develop a non-invasive test for Barrett's Esophagus using the LightTouch technology platform. In its report on the Company's 2011 Form 10-K, UHY LLP, in Sterling Heights, Michigan, noted that the Company's recurring losses from operations and accumulated deficit raise substantial doubt about its ability to continue as a going concern. The Company reported a net loss of $6.64 million in 2011, compared with a net loss of $2.84 million in 2010. The Company's balance sheet at March 31, 2012, showed $3.08 million in total assets, $2.17 million in total liabilities and $908,000 in total stockholders' equity. Bankruptcy Warning According to the Form 10-K for the year ended Dec. 31, 2011, the Company's capital-raising efforts are ongoing. If sufficient capital cannot be raised during the fourth quarter of 2012, the Company has plans to curtail operations by reducing discretionary spending and staffing levels, and attempting to operate by only pursuing activities for which it has external financial support, such as under the Konica Minolta development agreement and additional NCI or other grant funding. However, there can be no assurance that such external financial support will be sufficient to maintain even limited operations or that the Company will be able to raise additional funds on acceptable terms, or at all. In that a case, the Company might be required to enter into unfavorable agreements or, if that is not possible, be unable to continue operations, and to the extent practicable, liquidate or file for bankruptcy protection. HARPER BRUSH: Committee Taps Freeborn & Peters as Counsel --------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 case of Harper Brush Works, Inc., asks the U.S. Bankruptcy Court for the Southern District of Iowa for authority to employ Freeborn & Peters LLP as counsel. As the Committee's counsel, Freeborn & Peters will: (a) advise the Committee on all legal issues as they arise; (b) represent and advise the Committee regarding the terms of any sales of assets or plans of reorganization or liquidation and assisting the Committee in negotiations with the Debtor and other parties; (c) investigate the Debtor's assets and pre-bankruptcy conduct; (d) analyze the perfection and priority of the liens of the Debtors' secured creditors; and (e) prepare, on behalf of the Committee, all necessary pleadings, reports, and other papers. Freeborn & Peters' hourly rates range from $230 per hour for new associates to $555 per hour for senior partners. Paraprofessional services will be billed at $185 per hour. The customary and proposed hourly rates to be charged by the Firm for individuals expected to be directly involved in representing the Committee are: Richard S. Lauter (Partner) $555 Thomas R. Fawkes (Partner) $480 Devon J. Eggert (Associate) $320 Elizabeth L. Rodgers (Associate) $230 Freeborn & Peters will also seek reimbursement of necessary out- of-pocket expenses. The firm attests it is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Harper Brush Works Fairfield, Iowa-based Harper Brush Works, Inc., filed a Chapter 11 petition (Bankr. S.D. Iowa) in Des Moines on May 29, 2012. Family-owned Harper Brush -- http://www.harperbrush.com/-- provides more than 1,000 products, including pushbrooms, mops, floor squeegees, automotive brushes, dust pans, and buckets. The Company disclosed assets of $10.4 million against debt totaling $10 million, including $6 million owing to secured creditors. Judge Anita L. Shodeen presides over the case. Donald F. Neiman, Esq., and Jeffrey D. Goetz, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C., serve as bankruptcy counsel to the Debtor. Marc B. Ross serves as the Debtor's Chief Restructuring Officer. HAWAIIAN TELCOM: Bid to Withdraw Reference in Ruley Suit Due Nov. ----------------------------------------------------------------- Bankruptcy Judge Lloyd King in Honolulu, Hawaii, said he will entertain a motion to withdraw bankruptcy court reference of a lawsuit commenced by the litigation trustee in the Chapter 11 case of Hawaiian Telcom Communications, Inc., against Michael S. Ruley if filed on or before Nov. 1, 2012. On April 17, 2012, the Court entered an order vacating the trial date in the lawsuit of July 9, 2012, extending the discovery cut- off date and calculation of associated deadlines to Aug. 31, 2012, and requiring the defendant to file a memorandum on entitlement to a jury trial. The Defendant filed the memorandum timely May 18, 2012. Judge King said the Defendant's jury demand is well-taken. Judge King indicated that it is appropriate that reference of the lawsuit be withdrawn to the United States District Court so that a district judge may preside at a jury trial. However, a bankruptcy proceeding may be withdrawn only on the timely motion of a party or by the district court on its own motion. "[T]he best course of action is for one or more of the parties to move to withdraw reference once the bankruptcy court disposes of all pretrial matters," Judge King said. For the purpose of withdrawing reference, Judge King held that pretrial matters will be concluded as of the discovery cut-off date, further extended by stipulated order to Oct. 31, 2012. The deadlines to file or make disclosures, discovery requests, designation of experts and submission of their reports, as well as motions to join or amend and to compel discovery have passed or will have passed by Oct. 31, 2012. Any dispositive motions and motions in limine may be considered by the district judge prior to trial in accordance with the district court's local civil rules. According to Judge King, a motion to withdraw reference must be filed in the bankruptcy court, together with payment of the $176 filing fee, by one or more of the parties. The motion should not be filed before November 1, 2012, or if discovery is concluded earlier, not before the filing of a certification to that effect by counsel for both parties. The lawsuit is, SHULTS & TAMM, a law corporation, as Litigation Trustee, Plaintiff, v. MICHAEL S. RULEY, Defendant, Adv. Proc. No. 11-90012 (Bankr. D. Hawaii). A copy of the Court's July 25, 2012 Memorandum Regarding Withdrawal of Reference is available at http://is.gd/0SLOAwfrom Leagle.com. About Hawaiian Telcom Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc. -- http://www.hawaiiantel.com/-- operates a telecommunications company, which offers an array of telecommunications products and services including local and long distance service, high-speed Internet, wireless services, and print directory and Internet directory services. The Company and seven of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13086) on Dec. 1, 2008. Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware on Dec. 30, 2008, approved the transfer of the Chapter 11 cases to the U.S. Bankruptcy Court for the District of Hawaii before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005). Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, represented the Debtors in their restructuring efforts. The Debtors tapped Lazard Freres & Co. LLC as investment banker; Zolfo Cooper Management LLC as business advisor; Deloitte & Touche LLP as independent auditors; and Kurztman Carson Consultants LLC as notice and claims agent. An official committee of unsecured creditors was appointed and represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii. When the Debtors filed for protection from their creditors, they disclosed total assets of $1,352,000,000 and total debts of $1,269,000,000 as of Sept. 30, 2008. Judge King entered on Dec. 30, 2009, an order confirming a plan of reorganization for Hawaiian Telcom. The plan was declared effective in October 2010 after the Reorganized Debtors obtained the backing of the U.S. Federal Communications Commission and the Hawaii Public Utilities Commission. Shults & Tamm was appointed the litigation trustee, and is represented by Christopher Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi in Honolulu. HAWKER BEECHRAFT: Judge Holds Back Decision on Bonus Plan --------------------------------------------------------- The Associated Press reports the Bankruptcy Judge has withheld a decision regarding a disputed proposal that would grant up to $5.3 million in bonuses to eight Hawker Beechcraft senior executives in a Key Employee Incentive Plan. The report relates the judge asked for a written summary of the testimony from the hearing before he rules on the matter. At the same time, the judge approved an additional $1.9 million in bonuses for 31 other management-level employees at Hawker Beechcraft in a Key Employee Retention Plan. The report notes the Justice Department's bankruptcy watchdog agency and the Machinists union filed objections to the bonus plan. Both have challenged the bonus plan, contending it is essentially a "disguised retention plan" that does little other than reward managers for staying during bankruptcy reorganization, the report notes. "If this motion is approved, the Beechcraft Eight can rightfully take their place as the newest poster boys for corporate greed and excess in the United States," the report quotes Ron Eldridge, the union's aerospace coordinator, as stating. According to the report, the company defended the proposal in a document filed with the court before the hearing, saying the payments are appropriate because there is significant work to do before the company emerges from bankruptcy. The report, citing court documents, says pursuing the proposal involves obtaining multiple regulatory approvals, carving out the defense business, negotiating with key parties to preserve important business relationships, responding to diligence requests, drafting and negotiating a definitive purchase agreement and, if an agreement is reached, conducting a competitive auction to try for higher or better offers. The report notes, at the same time, the senior leadership team must work on a plan to emerge from bankruptcy as a stand-alone company. That will require securing support for the plan from creditors, resolving the treatment of the company's three defined benefit plans, negotiating the terms of a new retirement plan and getting commitments for financing to emerge from Chapter 11. The report says a stand-alone plan also means implementing an "orderly shut down" of the business jet business, which will include facility closures and reductions in force. The report relates, in order for any bonuses to be paid, the company must consummate the standalone plan before Dec. 15 or close the sale of the company before Jan. 15. The report relates U.S. Trustee Tracy Hope Davis argued there must be other factors such as "challenging standards" or "high hurdles" for debtors to overcome before they can be paid bonuses, and that Hawker Beechcraft's bonus plan did not meet those standards. About Hawker Beechcraft Hawker Beechcraft Inc., a designer and manufacturer of light and medium-sized jet, turboprop and piston aircraft, filed for Chapter 11 reorganization together with 17 affiliates (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. The Senior Secured Lenders' legal representative is Wachtell Lipton Rosen & Katz and their financial advisor is Houlihan Lokey. 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. The Committee tapped FTI Consulting, Inc., as its financial advisor. Hawker Beechcraft has entered into exclusive negotiations with Superior Aviation Beijing Co., Ltd. regarding a $1.79 billion strategic combination. As part of the exclusivity agreement, Superior will provide $50 million to sustain Hawker Beechcraft's jet business. Any definitive agreement reached with Superior would be subject to approval by the Committee on Foreign Investment in the United States and other regulatory agencies. In addition, any definitive agreement with Superior will be subject to termination if another potential purchaser succeeds in the mandatory competitive auction process which will be overseen by the U.S. Bankruptcy Court. If negotiations with Superior are not concluded in a timely manner, Hawker Beechcraft will proceed with seeking confirmation of the Joint Plan of Reorganization it filed with the U.S. Bankruptcy Court on June 30, 2012, which contemplates Hawker Beechcraft emerging as a standalone entity with a more focused portfolio of aircraft. Under the Standalone Plan, the company would wind down the company's jet-related businesses, a process that likely would have commenced already but for Superior's compelling proposal to the company. Superior's legal representative is Locke Lord LLP and its financial advisor is Grant Thornton. HAWKER BEECHCRAFT: Machinists to Block Excessive Bonuses for Exec ----------------------------------------------------------------- Calling it a thinly disguised effort to reward top executives at Hawker Beechcraft for achieving "routine, short-term and not particularly challenging" tasks, the International Association of Machinists and Aerospace Workers filed a formal objection to a proposal that would grant up to $5.3 million for the Beechcraft Eight, an octet of senior executives named as beneficiaries of a so-called Key Employee Incentive Plan (KEIP). "The attempt to implement such a lucrative bonus program for the very executives who led Hawker Beechcraft into bankruptcy is particularly outrageous after thousands of Hawker employees have already lost their jobs and thousands more could lose jobs and pension benefits," said IAM Aerospace Coordinator Ron Eldridge. "These executives, who already have a fiduciary duty to maximize Hawker Beechcraft's value, should not need any additional incentive to complete their most basic responsibilities." In its filing, the IAM said the Court should not lose sight of the "complete irony and hypocrisy" of a motion seeking to provide millions in bonuses for executives at a company struggling to survive. "If this motion is approved, the Beechcraft Eight can rightfully take their place as the newest poster boys for corporate greed and excess in the United States," said Eldridge. "The 80-year legacy of Hawker Beechcraft deserves better than this tawdry spectacle of corporate avarice." The IAM also calls for the motion to be denied because the KEIP fails to specify any true "incentive thresholds" as required by U.S. Bankruptcy Code. Rather, the motion seeks to provide the executives with up to $5.3 million in "pay to stay" bonuses. The lack of true incentives going forward reveals the KEIP for what it really is - a retention plan that fails to satisfy basic Bankruptcy Code requirements. The IAM represents more than 3,500 workers at Hawker Beechcraft and is one of the largest industrial trade unions in North America, representing nearly 100,000 aerospace workers among 700,000 active and retired members in dozens of industries. About Hawker Beechcraft Hawker Beechcraft Inc., a designer and manufacturer of light and medium-sized jet, turboprop and piston aircraft, filed for Chapter 11 reorganization together with 17 affiliates (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 Beechcraft disclosed assets of $1,831,097 plus undetermined amounts, and liabilities of $1,704,736,958 plus undetermined amounts. 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. The Committee tapped FTI Consulting, Inc., as its financial advisor. HOVNANIAN ENTERPRISES: S&P Alters Ratings Outlook to Positive ------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Hovnanian Enterprises Inc. to positive from negative. "At the same time, we affirmed our ratings on the company, including the 'CCC-' corporate credit rating," S&P said. "The outlook revision reflects the company's improved liquidity position," said credit analyst George Skoufis. "We also revised our liquidity assessment to 'adequate' from 'less than adequate.' Hovnanian has taken steps to improve its near-term liquidity, which consists of cash that modestly exceeds our prior expectations. Importantly, the company faces negligible maturities over the next 18 months. However, we note that aggressive land spend or debt repurchases would reduce what is a moderate absolute level of cash." "The positive outlook reflects an improved liquidity position that appears sufficient to meet near-term capital needs. We would raise our ratings if recently improved operating trends appear sustainable and adequate liquidity is maintained. Alternatively, we would lower our ratings if housing operations deteriorate and the company aggressively invests in land resulting in a cash position below the low end of the company's cash target or we believe another distressed debt exchange or debt restructuring is likely." HUGHES TELEMATICS: Completes Merger with Verizon Telematics ----------------------------------------------------------- HUGHES Telematics, Inc., completed its merger with Verizon Telematics Inc. "Sub", a wholly owned subsidiary of Verizon Communications Inc., pursuant to the Agreement and Plan of Merger, dated as of June 1, 2012, by and among the Company, Verizon and Sub. Pursuant to the Merger Agreement, Sub merged with and into the Company, with the Company surviving the Merger as a wholly owned subsidiary of Verizon. In connection with the Merger, on July 26, 2012, the Company repaid: -- all amounts accrued and outstanding under the Amended and Restated Credit Agreement, dated as of April 9, 2008, among the Company, the lenders party thereto, Morgan Stanley Senior Funding, Inc., as administrative agent, and Morgan Stanley & Co. LLC, as collateral agent; -- all amounts accrued and outstanding under the Senior Subordinated Unsecured Promissory Note, dated as of March 31, 2008, executed by the Company payable to Communications Investors LLC; and -- all amounts accrued and outstanding under the Senior Subordinated Unsecured Promissory Note, dated as of Dec. 12, 2008, executed by the Company payable to PLASE HT, LLC. In accordance with the Merger Agreement, at the Effective Time, each outstanding share of common stock of the Company was converted into the right to receive $12.00 in cash, without interest, other than (1) Earnout Shares, (2) any shares of Common Stock owned by Verizon or the Company or any of their subsidiaries and (3) those shares of Common Stock with respect to which appraisal rights under Delaware law are properly exercised and not withdrawn. Additionally, at the Effective Time, outstanding warrants and vested options were canceled and converted into the right to receive an amount in cash, without interest, equal to the excess, if any, of the Merger Consideration over the exercise price per share of each such warrant or option, as applicable, multiplied by the number of shares that could have been purchased, payable within 10 days of the Effective Time. Each Non-Earnout Option that was unvested at the Effective Time was converted into a right to receive the Non-Earnout Option Consideration payable on the earliest of (1) Dec. 31, 2012, (2) the last payroll date of Verizon in 2012 and (3) the payroll date of Verizon following the date the Non-Earnout Option would have become vested, in an amount equal to the product of the excess of the Merger Consideration over the exercise price per share multiplied by the number of shares that may be purchased. Quotations of Common Stock were suspended prior to the open of trading on July 26, 2012. On July 13, 2012, the Company notified the Financial Industry Regulatory Authority of the planned Merger. Upon notice to FINRA of the consummation of the Merger prior to the open of trading on July 26, 2012, the Common Stock was removed from the Over-the-Counter Bulletin Board, where that stock was quoted under the symbol "HUTC." The Company intends to file with the SEC a certification and notice of termination with respect to its Common Stock on Form 15, requesting that its Common Stock be deregistered under Section 12(g) of the Securities Exchange Act of 1934, as amended, and that the reporting obligations of the Company with respect to its Common Stock under Sections 13 and 15(d) of the Exchange Act be suspended. Accordingly, the last day that the Common Stock was quoted on the OTCBB was July 25, 2012. On July 26, 2012, all of the directors of the Company immediately prior to the Merger were replaced by the following individuals: John W. Diercksen and John G. Stratton. The officers of the Company immediately prior to the Effective Time continued as officers of the Company through and following the Effective Time. In connection with the Merger, the Company removes from registration all of its securities registered pursuant to the Registration Statements filed with the SEC that remain unsold on July 26, 2012. About HUGHES Telematics Atlanta, Ga.-based HUGHES Telematics, Inc. is a telematics services company that provides a suite of real-time voice and data communications services and applications for use in vehicles and is developing additional applications for use within and outside of the automotive industry. HUGHES reported a net loss of $85.35 million in 2011, a net loss of $89.56 million in 2010, and a net loss of $163.66 million in 2009. The Company's balance sheet at March 31, 2012, showed $110.18 million in total assets, $211.81 million in total liabilities, and a $101.62 million total stockholders' deficit. In its report on the Company's 2011 financial results, PricewaterhouseCoopers LLP, in Atlanta, Georgia, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring losses from operations and has a net capital deficiency. ICONIC IMPORTS: Bankr. Pending Discharge, Says Parent ----------------------------------------------------- Iconic Brands, Inc. disclosed corporate updates as related to ongoing operations and forward looking plans. "As previously announced in September of last year our wholly owned subsidiary, Iconic Imports Inc. was forced to file chapter 7 bankruptcy when a senior creditor foreclosed on the subsidiary assets. The bankruptcy hearing has been held without claim and is pending discharge. There is no effect on the capital structure; the company maintains approximately 52 million shares outstanding with approximately 20 million in the public float. Iconic Brands said, "In the interim we have aggressively started the process to update our financials and engage in new business opportunities to create value for our shareholders. We anticipate having all of the financials updated by no later than the third quarter ending September 30th, 2012. We have put up a simple website to provide information while going through this process. http://www.icnb.info/" "It should be noted that on July 24th we received a notice from OTCMarkets that our company stock has been labeled with "Caveat Emptor" for unusual trading in terms of price and/or volume of the security without current information available for investors, we have spoken with OTCMarkets and they're aware that the company is updating the information and will remove this moniker immediately post of our filings." About Iconic Brands Headquartered in New York, NY Iconic Brands historically developed, marketed and distributed high-quality branded alcoholic beverages, the company is currently evaluating several business opportunities for new product launch this year and possible business combinations. INTERNATIONAL HOME: Court OKs $250,000 Loan from Principal ---------------------------------------------------------- The Hon. Enrique S. Lamoutte Inclan of the U.S. Bankruptcy Court for the District of Puerto Rico authorized International Home Products, Inc., and Health Distillers International, Inc., to obtain $250,000 unsecured debtor-in-possession financing from their principal A. Berti Foti. The Debtors would use the money to continue to purchase new inventory, fund its operations and pay its employees. Mr. Foti committed to provide the funding because First Bank of Puerto Rico refused to allow the use of the Debtors' cash collateral. The Court also ordered that repayment obligations be afforded superpriority status. About International Home Products International Home Products, Inc., is engaged in the sale, financing of "Lifetime" cookware and other kitchenware as well as sale of account receivables in the secondary market. It is the exclusive distributor of "Lifetime" products in Puerto Rico for over 40 years. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. P.R. Case No. 12-02997) on April 19, 2012. Carmen D. Conde Torres, Esq., in San Juan, P.R., serves as the Debtor's counsel. Wigberto Lugo Mendel, CPA, serves as its accountants. The Debtor disclosed $66,155,798 and $43,350,031 in liabilities as of the Chapter 11 filing. Secured lender First-Bank Puerto Rico is represented by Manuel Fernandez-Bared, Esq., and Jane Patricia Van Kirk, Esq., at Toro, Colon, Mullet, Rivera & Sifre, P.S.C. INTERPOOL INC: S&P Assigns B+ Corp. Credit Rating; Outlook Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' long-term corporate credit rating to Interpool Inc. The outlook is stable. "At the same time, we assigned a 'B-' rating (two notches below the corporate credit rating) to the proposed $325 million second- lien notes to be co-issued by TRAC Intermodal Corp. and TRAC Intermodal LLC, wholly owned subsidiaries of TRAC Intermodal Holding Corp.(Holding) (not rated). Holding is parent to Interpool Inc.," S&P said. "We assigned the notes a '6' recovery rating indicating likely negligible (0-10%) recovery for noteholders in a payment default," S&P said. "The ratings on Princeton, N.J.-based Interpool reflect the company's substantial debt load and limited financial flexibility," said Standard & Poor's credit analyst Funmi Afonja. "The company has pledged almost all of its assets as collateral under various financings. Positive credit factors include Interpool's No. 1 market position in an industry with limited number of market participants, as well as its ability to scale back capital spending and reduce debt in periods of weak demand. We categorize Interpool's business risk profile as 'fair,' its financial risk profile as 'aggressive,' and its liquidity as 'adequate' under our criteria." "Interpool operates under the name TRAC Intermodal. The company provides long-term chassis leases, pooling arrangements, and chassis management services to liner companies, railroads, and U.S. transportation companies. Interpool generates the substantial majority of revenues and earnings from chassis pooling arrangements and from term leases, and the remaining from finance leases and management fees for managing equipment for customers. Chassis are wheeled frames that carry intermodal cargo containers, together forming the equivalent of a truck trailer. In July 2007, an affiliate of Fortress Investment Group LLC (not rated) purchased Interpool and took the company private. The company does not publicly disclose financial information," S&P said. "Interpool has a dominant presence in both the markets to lease chassis that carry marine cargo containers (i.e., those transferred from ships) and those that carry domestic cargo containers, and it is the largest U.S. chassis leasing company. Interpool has slightly more than half of the market for leased marine chassis market (shipping lines, trucking companies, and intermodal marketing companies that own and operate chassis, in addition to those leasing companies provide) and slightly more than half of the entire domestic chassis market (both those that lessors provide and those that other companies own, such as truckers). Interpool has an active fleet of approximately 249,000 chassis, most of which it owns. The average age of the active fleet is about 11.5 years. Interpool's fleet is substantially larger than that of its closest competitor, Flexi-Van Leasing Inc. (not rated). Interpool and Flexi-Van are the dominant players among chassis lessors," S&P said. "We believe Interpool will continue to benefit from a sluggish, but gradually improving, U.S. economy, which supports cargo transportation volumes and chassis usage. Fleet utilization averaged in the high-80% area during 2011, compared with an average in the mid-80% percent area during 2010, and we expect a modest improvement in utilization during 2012.Most of Interpool's equipment is under pooling arrangements or long-term leases (terms greater than one year), and a small portion is on direct finance leases. Pools are arrangements under which a lessor manages a group of chassis owned by various companies (which may include the lessor) and makes them available to users on a short-term basis. The average remaining term on Interpool's term leases is less than two years, and on direct finance leases it is less than five years," S&P said. "We expect revenues and earnings to increase in 2012, benefiting from higher utilization and modest increase in lease rates. Higher operating expenses for repositioning chassis currently in storage back into use and costs associated with repairs and tune-ups of chassis will partly offset the improvement. We expect operating margins (after depreciation and amortization) of about 19%, compared with about 17% at year-end 2011. We also expect funds from operations (FFO) to debt to approach 10% during 2012, compared with 8.6% at the end of 2011, and for debt to capital to remain in the mid-60% area. Interpool, as an equipment leasing company, operates at higher leverage than comparably rated industrial companies. Credit measures could vary depending on the timing and magnitude of capital spending," S&P said. "The stable outlook reflects our expectation that the company will modestly improve its financial profile. A modest near-term increase in debt will partly offset earnings and cash flow from higher utilization and rates. We could lower our ratings if renewed economic weakness causes lower utilization and pricing, causing earnings and cash flow to fall such that FFO to total debt falls to and remains less than 5% and debt to capital exceeds 80%. We do not expect to raise the ratings over the next year. However, we could raise the rating if better-than-expected earnings or reduced debt cause FFO to debt to approach mid-teens percent and operating margins to rise higher than 20% on a sustained basis," S&P said. KINGSBURY CORP: Brendan Recupero Withdraws as Committee's Counsel ----------------------------------------------------------------- Brendan C. Recupero, Esq., on July 13 submitted a notice of withdrawal of appearance as counsel to the Official Committee of Unsecured Creditors in Kingsbury Corp., et al.'s Chapter 11 cases. The law firm of Jager Smith P.C. will remain as counsel for the Committee. The Committee's counsel can be reached at: Steven C. Reingold, Esq., JAGER SMITH P.C. One Financial Center Boston, MA 02111 Tel: (617) 951-0500 Fax: (617) 951-2414 E-mail: sreingold@jagersmith.com About Kingsbury Corp. Kingsbury Corp. -- http://www.kingsburycorp.com/-- makes and assembles machine systems. Kingsbury and affiliate Ventura Industries, LLC, filed Chapter 11 petition (Bankr. D. N.H. Case Nos. 11-13671 and 11-13687) on Sept. 30, 2011. Jennifer Rood, Esq., and Robert J. Keach, Esq., at Berstein, Shur, Sawyer & Nelson, serve as counsel to the Debtors. Donnelly Penman & Partners serves as its investment banker. In its schedules, the Debtor disclosed $10,134,679 in assets, and $24,534,973 in liabilities as of the petition date. William K. Harrington, the U.S. Trustee for Region 1, appointed five members to serve on the Official Committee of Unsecured Creditors. KMC REAL ESTATE: Plan of Reorganization Confirmed ------------------------------------------------- Judge Basil H. Lorch III late last month entered an order confirming the Chapter 11 Plan of Reorganization of KMC Real Estate Investors, LLC. Judge Lorch held a hearing on May 31 on the Second Amended Plan of Reorganization dated March 13, 2012. The Plan provides for these terms: * RL BB Financial LLC (Rialto), which asserted a $21 million secured claim, will receive a promissory note in the principal amount of $16 million. Rialto will retain its lien on the Debtor's real estate and the note will bear annual interest at the fixed rate of two (2) points above the prime rate published by the Wall Street Journal in effect on the Effective Date, and the obligations thereunder will mature 240 months after the Effective Date. The monthly payment obligations owing to Rialto under Rialto Note A will be determined based on a 360-month amortization. * Holders of unsecured claims not entitled to priority (Class 3A) aggregating $403,000 will receive beginning 30 days after the effective date of the Plan cash distributions representing each holder's pro rata portion of regular payments totaling $6,725 per month for a period of 60 months. The Debtor's liability to DivLend Equipment Leasing, LLC (Class 3B) under a guaranty will remain intact. Rialto will receive $500,000 on account of its unsecured claims (Class 3C). Holders of unsecured subrogree claims (Class 3D) will retain its subrogation rights against the Debtor. * Membership interests in the Debtor will be cancelled. According to the Plan order dated June 28, Rialto's objections were overruled on the merits. Judge Lorch held that the combination of the cash infusion into KMC and KMCREI, the completion of the hospital facility, combined with the ongoing operations of KMC and its ability to make rental payments to KMCREI, all pursuant to their respective Plans, sufficiently demonstrates the feasibility of the KMCREI Plan. The Debtor's ability to fund the Plan is premised on the Debtor's and KMCREI's ability to obtain infusions of capital from affiliates of Granger Group, LLC in the aggregate amount of not less than $10,820,357. The exit investors will contribute cash to fund the Plan in exchange for the sole membership interest in KMCREI. The judge said that the Plan's treatment of the unsecured claims is fair and equitable, and does not result in unfair discrimination. He said that the separate classification of Rialto's unsecured deficiency Class 3C Claim from general unsecured claims included in Class 3A is appropriate and justified under 11. U.S.C. Sec. 1122 due to the different nature of the claims included in Class 3A, which are comprised of claims for goods or services provided to KMCREI or KMC and are held by claimants KMC and KMCREI may have ongoing business relations with, as compared to RL BB's Class 3C Claim, comprised solely of the deficiency balance on its secured claim. Further justifying the appropriateness of separately classifying Rialto's Class 3C Claim from the general unsecured claims in Class 3A are the guaranties RL BB holds executed by a number of doctors securing RL BB's claims against KMCREI and the large sums already collected, and likely yet to be collected, on said guaranties. A copy of the confirmation order is available for free at: http://bankrupt.com/misc/KMC_RE_Plan_Order.pdf About KMC Real Estate Investors Clarksville, Indiana-based KMC Real Estate Investors LLC owns certain real property located in Clark County, Indiana, commonly known as 4601 Medical Plaza Way, Clarksville, Indiana. The Company filed for Chapter 11 bankruptcy protection (Bankr. S.D. Ind. Case No. 11-90930) on April 1, 2011. Gary Lynn Hostetler, Esq., and Courtney Elaine Chilcote, Esq., at Hostetler & Kowalik, P.C., in Indianapolis, Indiana, serve as the Debtor's bankruptcy counsel. The Debtor disclosed it has undetermined assets and $24.8 million in liabilities as of the Chapter 11 filing. Affiliate Kentuckiana Medical Center, LLC, previously sought Chapter 11 protection (Bankr. S.D. Ind. Case No. 10-93039) on Sept. 9, 2010. The Bankruptcy Court granted RL BB Financial relief from stay on the Debtor's assets. The relief from stay is effective on July 25, 2011, at the close of business. KNOTT'S INTERIORS: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Knott's Interiors, Inc. 1505 North Hermitage Road Hermitage, PA 16148 Bankruptcy Case No.: 12-11068 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Western District of Pennsylvania (Erie) Judge: Thomas P. Agresti Debtor's Counsel: Donald R. Calaiaro, Esq. CALAIARO & CORBETT, P.C. 310 Grant Street, Suite 1105 Pittsburgh, PA 15219-2230 Tel: (412) 232-0930 Fax: (412) 232-3858 E-mail: dcalaiaro@calaiarocorbett.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $500,001 to $1,000,000 A copy of the Company's list of its 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/pawb12-11068.pdf The petition was signed by Charles Knott, president. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Charles Knott KNOWLEDGE UNIVERSE: S&P Lowers Issuer Credit Ratings to 'CCC' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on U.S. early childhood education provider Knowledge Universe Education LLC (KUE) to 'CCC' from 'B-'. "At the same time, we removed all the ratings from CreditWatch, where they were placed with negative implications on April 5, 2012. The outlook is negative," S&P said. "The downgrade reflects our expectation that absent a significant rebound in operating performance, KUE's continued negative discretionary cash flow will consume its cash balances," said Standard & Poor's credit analyst Hal Diamond. "We also believe that the company will likely need another amendment to its revolving credit facility due June 2014 by the second half of 2013. Its covenants tighten every quarter starting September 2012 until March 2014, while continued high unemployment and strained state budgets would likely restrict a rebound in operating performance." "Standard & Poor's rating on KUE reflects the company's 'weak' liquidity position, including its narrow headroom with amended covenants, and rising lease-adjusted leverage (11x as of March 31, 2012), underpinning our financial risk profile assessment of 'highly aggressive.' We consider the company's business risk profile 'vulnerable' because of its narrow operating focus, sensitivity of capacity utilization rates to high unemployment, and dependence on state and local federal subsidized programs, which are vulnerable to budget constraints." "We expect KUE to continue to underperform some of its U.S. peers, and maintain a lower EBITDA margin," added Mr. Diamond. "The negative outlook reflects that operating performance will remain weak in the child care services industry and our concern that KUE's cash balances will continue to fall as a result of negative discretionary cash flow. We see the risk that the company will need an amendment or waiver in the latter half of 2013 to avoid a covenant violation if EBITDA declines do not reverse," S&P said. "We could lower the rating if EBITDA declines more rapidly than currently expected and negative discretionary cash flow accelerates, aggravating weak liquidity. More specifically, if revenue falls 5% and EBITDA drops an additional 10%, resulting in only a mid-single-digit percent cushion of compliance, with a possibility of declining further, we could lower the rating," S&P said. "We regard a near-term revision of the outlook to stable as a remote scenario, involving consistent improvement in overall profitability, reversal of discretionary cash flow deficits, and financial policies that support progress in reducing leverage and restoring a healthy margin of compliance with financial covenants," S&P said. LACK'S STORES: Landlord, Not Assignee, Can File Rejection Claim --------------------------------------------------------------- Lack's Stores, Inc., rejected a lease on real property located in Williamson County at 13530 IIWY 183 North, in Austin, Texas. The Group J-Bar Inc. leased the Property to Lack's. The Group Family Limited Partnership purchased the Property from J-Bar, and GFP "is the successor in interest to all of the right, title and interest of [J-Bar], as Landlord, under the Lease." GFP assigned the Lease to Thrivent Financial for Lutherans Inc. "to secure its indebtedness to Thrivent." Prior to Lack's bankruptcy filing, Thrivent loaned $3,400,000 to GFP secured by a Deed of Trust and Security Agreement and Fixture Financing Statement, an Assignment of Leases and Rents, and other collateral security documents. Thrivent, an assignee of the Lease, filed a proof of claim against Lack's for lease rejection damages. GFP, the landlord under the Lease and title owner of the Property, filed its own proof of claim for lease rejection damages under the same Lease. Thrivent contends that as assignee of the Lease -- in accordance with the provisions of the Deed of Trust, Assignment, and Security Documents -- it is entitled to the lease rejection damages. GFP contends that it, as the landlord under the Lease, is entitled to the lease rejection damages. Based on the entire record, Bankruptcy Judge Jeff Bohm held that Thrivent has an assignment from GFP, which allows Thrivent to recover the rents from the Property only in the event of default by GFP -- and GFP is not in default. Accordingly, the Court ruled that Thrivent, as a matter of law, is not entitled to the lease rejection damages asserted in its Proof of Claim; and the Court further concluded that GFP is entitled to collect the lease rejection damages from Lack's. Nevertheless, Thrivent's lien attaches to these funds, and GFP cannot freely use them until the Note is repaid. A copy of the Court's July 25, 2012 Memorandum Opinion is available at http://is.gd/GQnO3Ffrom Leagle.com. About Lack's Stores Victoria, Texas-based Lack's Stores, Incorporated, is one of the largest, independently-owned retail furniture chains in the United States. Lack's Stores is a chain of 36 retail stores and operates under the trade styles Lacks and Lacks Home Furnishings. The Company sells a complete line of furnishings for the home including furniture, bedding, major appliances and home electronics. The stores are located in South, Central, and West Texas. Lack's Stores filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Case No. 10-60149) on Nov. 16, 2010. Katherine D. Grissel, Esq., Michaela Christine Crocker, Esq., and Richard H. London, Esq., at Vinson & Elkins LLP, assist the Debtor in its restructuring effort. The Debtor estimated its assets and debts at $100 million to $500 million. Affiliates Lack Properties, Inc., Lack's Furniture Centers, Inc., and Merchandise Acceptance Corporation filed separate Chapter 11 petitions. Lack's Stores' First Amended Joint Plan of Reorganization was declared effective on June 1, 2012. The Plan was confirmed at an April 3, 2012 hearing. LEHMAN BROTHERS: Files Updated Cash Flow Estimates -------------------------------------------------- Lehman Brothers Holdings Inc. filed in U.S. Bankruptcy Court for the Southern District of New York cash flow estimates for the period beginning Jan. 1, 2012 through the Company's estimated end of activities. The Company's current total estimate for net cash from operations for the period subsequent to Jan. 1, 2011 is $40.5 billion, reflecting a $6 billion increase in estimated net cash from operations as compared to the estimates in its earlier Disclosure Statement filed in August 2011. The Modified Third Amended Joint Chapter 11 Plan, Disclosure Statement and related filings, including the cash flow estimates referred to above, can be found at http://www.lehman-docket.com/ in the "Key Documents" section. The Company has established an email address, which can also be found in the filing referenced above, to receive questions regarding financial disclosures. The Company plans to review questions and, where appropriate, post responses. 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) LEE'S FORD: Court Approves DelCotto Law Group as Counsel -------------------------------------------------------- Lee's Ford Dock Inc. and its affiliates sought and obtained approval from the U.S. Bankruptcy Court to employ DelCotto Law Group as counsel. The engagement will be led by Laura Day DelCotto, Esq., a member of the firm, and Amelia Martin Adams, Esq. To the best of the Debtors' knowledge, the attorneys of DLG do not have any connection with the Debtors, their creditors, any party in interest, or their respective attorneys. DLG has received a $80,000 retainer for services and expenses rendered prepetition (including filing fees) prior to filing the petition, and holds the remaining balance of $22,243 in escrow. DLG seeks court approval of a lien in its favor against the funds in its escrow account to secure payment of fees and expenses approved in the Chapter 11 cases. The firm's current hourly rates range from $150 to $425 per hour for attorneys and $130 to $145 per hour for paralegals. About Lee's Ford Dock Inc. Lee's Ford Dock Inc., Hamilton Brokerage LLC, Hamilton Capital LLC, Lee's Ford Hotels LLC, Lee's Ford Woods LLC, and Top Shelf Marine Sales Inc., filed for Chapter 11 bankruptcy (Bankr. E.D. Ky. Case Nos. 12-60818 to 12-60823) on July 4, 2008. The Debtors collectively operate as "Lee's Ford Resort & Marina" -- http://www.leesfordmarina.com/-- which consists of a boat dock, lodging facilities, the Harbor Restaurant & Tavern, a retail store, and a boat brokerage business and Web site located at http://www.buyaboat.neton Lake Cumberland in Nancy, Kentucky. Hamilton Brokerage LLC and Hamilton Capital LLC are not actively involved in the Debtors' operations, but are holding companies set up as part of the structure of the original purchase transactions which began in 2003. The Debtors' revenues were adversely impacted by the lowering of the water level of Lake Cumberland in January 2007 to allow for repairs to Wolf Creek Dam. The Debtors were forced to incur extraordinary costs to relocate the Dock and related facilities in accordance with the new water level. DelCotto Law Group PLLC serves as the Debtors' counsel. In its petition, Lee's Ford Dock estimated $10 million to $50 million in assets and debt. The petition was signed by James D. Hamilton, president. Mr. Hamilton has been designated as the individual responsible for performing the duties of the Debtors. LEVEL 3: Lowers Second Quarter Net Loss to $62 Million ------------------------------------------------------ Level 3 Communications, Inc., reported a net loss of $62 million on $1.58 billion of revenue for the three months ended June 30, 2012, compared with a net loss of $181 million on $913 million of revenue for the same period during the prior year. The Company's balance sheet at June 30, 2012, showed $12.94 billion in total assets, $11.73 billion in total liabilities and $1.21 billion in stockholders' equity. "We continue to see steady market demand for our services," said James Crowe, CEO of Level 3. "We saw double digit sequential growth in Core Network Services sales orders in the second quarter, and as a result, we expect stronger sequential performance for the second half of the year. Additionally, we remain on track to realize projected synergies, and integration is proceeding as planned." A copy of the press release is available for free at: http://is.gd/b6psNo 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. * * * 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. In the July 20, 2012, edition of the TCR, Moody's Investors Service affirmed Level 3 Communications, Inc.'s corporate family and probability of default ratings at B3. The company's B3 ratings are based on expectations that net synergies from the recently closed acquisition of Global Crossing Ltd. will reduce expenses sufficiently such that Level 3 will be modestly cash flow positive (on a sustained basis) by late 2013. LIBORIO MARKETS: Judge Converts Chapter 11 Case to Chapter 7 ------------------------------------------------------------ The Packer reports that Judge Barry Russell entered an order on July 27 converting the Chapter 11 reorganization of Liborio Markets Inc. to a Chapter 7 liquidation just three days after the U.S. Department of Agriculture lifted a reparation order against the company and members of the Alejo family. According to the report, the USDA's Agricultural Marketing Service restored the rights of the Los Angeles company and its principals to do business in the produce industry July 24. The agency stated the company had met its obligation under the Perishable Agricultural Commodities Act. The report says an unpaid debt of $21,461 to an unnamed Florida supplier spurred the USDA on April 3 to sanction the company and John Alejo, Enrique M. Alejo, Randy M. Alejo, and Enrique J. Alejo. The report relates, regardless of the removal of the sanction, members of the Alejo family and the group of Liborio companies they operate are still in the midst of a multimillion dollar bankruptcy case. According to the report, the judge set this schedule: -- Within 14 days of the order Liborio must file a schedule of unpaid debts incurred after the Chapter 11 case was filed (April 13); -- Within 30 days Liborio must file and transmit to the Chapter 7 trustee a final report; and -- Liborio must turn over to the trustee all records and property remaining in its custody and control. The report says bankruptcy documents show total debts of $50 million to $100 million. The bankruptcy filing estimates 100- 200 creditors, including a $56 million claim by Banco Popular North America. In its statement of financial affairs filed May 7, Liborio reported gross business revenue of $11 million in 2010, $10.58 million in 2011, and $2.57 million year-to-date at that time for 2012. Liborio Markets Inc. and the Alejo famiy are also defendants in two federal court disputes with produce suppliers who say they are owed a total of more than $1 million under PACA. In the federal court cases, Valley Fruit & Produce Co., Los Angeles, is seeking $887,000 and American Produce, Denver, is seeking $199,000. Those cases, both filed Jan. 23, remain pending. According to the report, the bankruptcy judge addressed those claims as well as those of other PACA creditors in a separate order July 27. He also gave Banco Popular retroactive control and possession of the stores operated by Liborio and the Alejo family back through July 24. The report says the judge ordered the bank to coordinate with PACA claimants valuation of perishable goods and personal property disposition. By Sept. 15 the bank, other debtors, PACA claimants and the trustee must file a report for the disposition of personal property in the case. "All proceeds from the liquidation of the personal property, net of all out-of-pocket costs incurred for security and asset disposition, shall be held by the bank in a segregated account pending resolution of any disputes concerning priority rights and interests . . .," the report quotes Judge Russell as stating. The report also relates John Alejo on July 23 asked the bankruptcy court for a 30-day extension to file the reorganization plan. The court had ordered the plan due July 24. In his declaration, Mr. Alejo said Liborio decided to close five of its weakest performing stores and convert them to Chapter 7 liquidation status. Mr. Alejo also said Liborio had been working diligently on transactions to aid with the reorganization, including the sale of real property, furniture and fixtures for $36.5 million to SP Grand Resources. Banco Popular objected to the extension request, saying "the debtors have not made any real progress toward reorganizing. All they have been able to do is manage to keep the doors open while digging themselves further into debt. . . ." Based in Pasadena, California, Liborio Market, Inc., operates a chain of supermarkets that retails meat products, seafood, poultry goods, fresh fruits, vegetables, fresh baked bakery goods, prepared foods, and private label products. The company has stores in Los Angeles, Maywood, and Ontario, California; Las Vegas, Nevada; and Commerce City, Aurora, Colorado Springs, and Thornton, in Colorado. The Company and its affiliates filed for Chapter 11 protection on April 13, 2012 (Bankr. C.D. Calif. Case No. 12-23254). Judge Barry Russell presides over the case. David B. Golubchik, Esq., at Levene neale Bender Rankin & Brill LLP, represents the Debtors. The Debtors estimated assets of between $1 million and $10 million, and debts of between $50 million and $100 million. LIGTHSQUARED INC: Final Order for $41 Million DIP Loan Entered -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York authorized, on a final basis, Lightsquared Inc., et al., to obtain up to the principal amount of $41.4 million from U.S. Bank National Association, as arranger, administrative agent, and collateral agent for and on behalf of itself and the other lenders party thereto. As of the Petition Date, an aggregate principal amount of approximately $322,333,494 was outstanding under the Prepetition Credit Documents. The Debtors have been unable to obtain financing from sources other than the DIP Lenders on terms more favorable than the DIP Facility. As reported in the Troubled Company Reporter on July 20, 2012, the loan, to LightSquared affiliate One Dot Six Corp., was modified since initial terms were proposed last month, Matthew Barr, a lawyer for the company, told Judge Chapman in court. An initial amount of $30 million was increased to $41.4 million, and the company will have the option to borrow $10 million more under certain conditions, Mr. Barr said. The debtor-in-possession loan would be until November. The money would be used for lease payments and building projects. U.S. Bank NA, an agent to pre- bankruptcy lenders already owed $322.3 million by the company's "Inc." unit, will serve as an agent to the new loan. One Dot Six is among LightSquared affiliates, known as the "Inc. obligors," which need funding to operate in bankruptcy. Another group of "LP" affiliates is using cash set aside as collateral. The group of LP lenders includes Capital Research & Management Co., Appaloosa Management LP and Fortress Investment Group LLC. About LightSquared LightSquared Inc. and 19 of its affiliates filed Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on May 14, 2012, as the Company seeks to resolve regulatory issues that have prevented it from building its coast-to-coast integrated satellite 4G wireless network. LightSquared had invested more than $4 billion to deploy an integrated satellite-terrestrial network. In February 2012, however, the U.S. Federal Communications Commission told LightSquared the agency would revoke a license to build out the network as it would interfere with global positioning systems used by the military and various industries. In March 2012, the Company's partner, Sprint, canceled a master services agreement. LightSquared's lenders deemed the termination of the Sprint agreement would trigger cross-defaults under LightSquared's prepetition credit agreements. LightSquared and its prepetition lenders attempted to negotiate a global restructuring that would provide LightSquared with liquidity and runway necessary to resolve its issues with the FCC. Despite working diligently and in good faith, however, LightSquared and the lenders were not able to consummate a global restructuring on terms acceptable to all interested parties, prompting the bankruptcy filing. As of the Petition Date, the Debtors employed roughly 168 people in the United States and Canada. As of Feb. 29, 2012, the Debtors had $4.48 billion in assets (book value) and $2.29 billion in liabilities. LightSquared also sought ancillary relief in Canada on behalf of all of the Debtors, pursuant to the Companies' Creditors Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the Ontario Superior Court of Justice (Commercial List) in Toronto, Ontario, Canada. The purpose of the ancillary proceedings is to request the Canadian Court to recognize the Chapter 11 cases as a "foreign main proceeding" under the applicable provisions of the CCAA to, among other things, protect the Debtors' assets and operations in Canada. The Debtors named affiliate LightSquared LP to act as the "foreign representative" on behalf of the Debtors' estates. Judge Shelley C. Chapman presides over the Chapter 11 case. Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to the Debtors. Kurtzman Carson Consultants LLC serves as claims and notice agent. Counsel to UBS AG as agent under the October 2010 facility is Melissa S. Alwang, Esq., at Latham & Watkins LLP. The ad hoc secured group of lenders under the Debtors' October 2010 facility was formed in April 2012 to negotiate an out-of- court restructuring. The members are Appaloosa Management L.P.; Capital Research and Management Company; Fortress Investment Group; Knighthead Capital Management LLC; and Redwood Capital Management. Counsel to the ad hoc secured group is Thomas E. Lauria, Esq., at White & Case LLP. Philip Falcone's Harbinger Capital Partners indirectly owns 96% of LightSquared's outstanding common stock. Harbinger and certain of its managed and affiliated funds and wholly owned subsidiaries, including HGW US Holding Company, L.P., Blue Line DZM Corp., and Harbinger Capital Partners SP, Inc., are represented in the case by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP. The Office of the U.S. Trustee has not appointed a statutory committee of unsecured creditors. MAXUM PETROLEUM: S&P Puts 'B' Corp. Credit Rating on Watch Pos -------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B' corporate credit rating on U.S. logistics company Maxum Petroleum Operating Co. on CreditWatch with positive implications. "The rating action followed Pilot's announcement that it intends to acquire 65% of Maxum. Maxum's corporate credit rating could be equated to that of Pilot's, but the degree of uplift will depend on our view of Maxum's strategic importance to Pilot, which we will assess as more details of the transaction emerge," S&P said. "Credit attributes specific to Maxum include the company's thin margins, significant working capital needs, and aggressive financial policy, offset by its broad operating footprint compared with its competitors and low maintenance capital spending requirements," said Standard & Poor's credit analyst Nora Pickens. "We expect to resolve the positive CreditWatch listing when more details of Pilot's strategy and the transaction emerge," S&P said. MIRAGE BOTTLING: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Mirage Bottling Group, Inc. dba Splash Water 6270 South Boyle Avenue Vernon, CA 90058 Bankruptcy Case No.: 12-35770 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Ernest M. Robles Debtor's Counsel: Phillip Myer, Esq. P.O. Box 94744 Pasadena, CA 91109-4744 Tel: (626) 798-0432 Fax: (626) 798-4361 E-mail: phillipmyer@sbcglobal.net Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/cacb12-35770.pdf The petition was signed by Marda Safaryan, president. MORGAN INDUSTRIES: Court Approves $2-Million BofA Financing ----------------------------------------------------------- Morgan Industries Corporation has obtained final approval from the U.S. Bankruptcy Court to use cash collateral and obtain from Bank of America, N.A., a senior secured priming and superiority debtor- in-possession revolving credit facility with a commitment amount equal to $2,000,000. The DIP financing and cash collateral will allow the Debtors to maintain operations pending the sale of substantially all of their assets. As reported in the Troubled Company Reporter on July 24, 2012, the Debtor is selling its Hunter Marine assets to Marlow Acquisitions, an affiliate of worldwide boat manufacturer Marlow Marine. The bankruptcy court has approved the sale. BofA objected to certain terms of the sale, including the rental rate payable under a triple-net lease. A late addition to the DIP order was a provision that states that after the proceeds of the Hunter sale is applied to the DIP facility, in addition to the $400,000 available to the Debtors pursuant to the DIP facility and the budget, the DIP lender agrees to make available an additional line of credit under the DIP facility for the purposes of funding expenses of a trust to be established pursuant to the Debtors' plan of liquidation. Cash Collateral BofA also serves as agent under the prepetition secured loans. As of the petition date, the Debtors owed $12.76 million under two term loans; $836,912 under three funded letters of credit; and $2.01 million under three unfunded letters of credit. The Court grants BofA, as prepetition lender, replacement liens and superpriority administrative expense claims as adequate protection for any diminution in value of its collateral resulting from the Debtors' use of cash collateral, the priming liens in favor of the DIP loans, and the anticipated sale of certain of its collateral, and the application of the sales proceeds to the repayment of the DIP obligations or otherwise. The replacement liens will be subject, however, to prior perfected security interests held as of the petition date by (i) Textron Financial Corp. on real property owned by debtor Luhrs Corporation, in Palatka, Florida, (ii) Salisbury Wicomico Economic Development Inc. on real property owned by one of the Debtors, Salisbury 20 Acres, LLC, in Wicomico County, Maryland, and (iii) Warren Luhrs and John Luhrs on the real property owned by one of the Debtors, Silverton Marine Corp., in Millville, New Jersey. About Morgan Industries Morgan Industries Corporation, along with affiliates, sought Chapter 11 protection (Bankr. D. N.J. Lead Case No. 12-21156) in Trenton, New Jersey, on April 30, 2012. Affiliates that filed separate bankruptcy petitions are Hunter Composite Technologies Corporation; Hunter Marine Corporation; Luhrs Corporation; Mainship Corporation; Ovation Yachts Corporation; Salisbury 10 Acres, L.L.C.; Salisbury 20 Acres, L.L.C.; and Silverton Marine Corporation. The Debtors, through their trade name the Luhrs Marine Group, produce and sell recreational powerboats and sailboats under the iconic brand names of Silverton, Ovation, Luhrs, Mainship, and Hunter Marine. In 2010, Silverton, Mainship and Luhrs, collectively, held roughly 5.3% of the U.S. market for fiberglass, in-board engine powerboats greater than 27 feet in length. Additionally, Hunter Marine was the largest manufacturer of sailboats in the U.S., accounting for an estimated 32% of new sailboat registrations in 2010, making it the sixth consecutive year Hunter Marine represented roughly 30% of all new sailboat registrations in the U.S. The Debtors have a network of 90 dealers in the U.S. and 80 dealers in 40 other countries. Judge Michael B. Kaplan oversees the case. Robert Hirsh, Esq., and George Angelich, Esq., at Arent Fox LLP serve as bankruptcy general counsel to the Debtors; Capstone Advisory Group, LLC, acts as financial advisors; Katz, Kane & Co. as investment bankers; and Donlin Recano & Company, Inc. as claims agent. The Debtors disclosed $53 million in total assets and $80 million in total liabilities as of the Chapter 11 filing. Stuart M. Brown, Esq., at DLA Piper LLP (US), represents primary lender Bank of America N.A. The Official Committee of Unsecured Creditors is represented by Lowenstein Sandler PC. MPG OFFICE: R. Maguire Redeems 3.9 Million Partnership Units ------------------------------------------------------------ MPG Office Trust, Inc., reported that on July 23, 2012, the Company received notices of redemption from Robert F. Maguire III and related entities requesting the redemption of 3,975,707 operating partnership units. On July 24, 2012, the Company issued 3,975,707 shares of the Company's common stock in exchange for these units. At Mr. Maguire's request, the Company issued the common stock to a party not related to Mr. Maguire. The redemption of these units and subsequent issuance of the common stock to a party not related to Mr. Maguire causes Robert F. Maguire III and related entities to fall below the 50% ownership requirement set forth in his contribution agreement. Therefore, all tax protection in favor of him and related entities, as well as all remaining limited partners, expired on June 27, 2013. Therefore, pursuant to the terms of the contribution agreement, all tax protection relating to the buildings listed below will now expire on June 27, 2013: Gas Company Tower US Bank Tower KPMG Tower Wells Fargo Tower Plaza Las Fuentes As a result of the redemption, the Company now owns approximately 97.6% of MPG Office, L.P., its Operating Partnership. About MPG Office Trust MPG Office Trust, Inc., fka Maguire Properties Inc. -- http://www.mpgoffice.com/-- is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high- quality office properties in the Southern California market. MPG Office Trust is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. The Company has been focused on reducing debt, eliminating repayment and debt service guarantees, extending debt maturities and disposing of properties with negative cash flow. The first phase of the Company's restructuring efforts is substantially complete and resulted in the resolution of 18 assets, relieving the Company of approximately $2.0 billion of debt obligations and potential guaranties of approximately $150 million. The Company reported net income of $98.22 million in 2011, compared with a net loss of $197.93 million in 2010. The Company's balance sheet at June 30, 2012, showed $2.06 billion in total assets, $2.88 billion in total liabilities, and a $827.88 million total deficit. MTS GOLF: U.S. Bank Won't Consent to Cash Collateral Use -------------------------------------------------------- U.S. Bank National Association said in papers filed in bankruptcy court it does not consent to the use of the cash securing a 2007 loan to MTS Land LLC and MTS Golf LLC. U.S. Bank is the assignee of the $32 million loan provided by San Diego National Bank in 2007. In October 2009 SDNB was closed by the Officer and Comptroller of the Currency and was taken over by the Federal Deposit Insurance Corporation, as Receiver for SDNB. The FDIC assigned the loan to U.S. Bank, effective as of Oct. 30, 2009. According to U.S. Bank, the loan is secured by the Debtors' real property, rents and related contracts and leases. The bank said the Debtors have failed to make monthly payments on the Loan commencing with the monthly payment due on March 5, 2010. The Lender provided notice to the Debtors of the Missed Payments by letter dated April 30, 2010, and the Missed Payments have not been received. As a result, the Debtors have been in default under the Loan since May 10, 2010. Kristena Hansen at Phoenix Business Journal reports that after nearly a decade of locking horns with the Paradise Valley Town Council, nearby residents and banks, MTS Land and MTS Golf, the owners of the now dormant Mountain Shadows Resort, are looking to the bankruptcy court to settle the dispute and allow the resuscitation of the property as outlined in a 1992 agreement with the town. MTS Land and MTS Golf are affiliates of Irvine, Calif.- based Crown Realty & Development Inc. According to Phoenix Business Journal, MTS Land and MTS Golf "seek to revitalize the once-thriving resort, elevating it to a level of excellence that will surpass its past glory," court records show, despite the fact they only have a combined $76,000 in cash and in bank accounts -- enough to sustain operations at the still-active golf course and clubhouse through only Aug. 26. Phoenix Business Journal notes that as MTS Land and MTS Golf seek approval for debtor-in-possession financing to keep operations running, they hope the bankruptcy filings will gain extra time to win the town's favor of redevelopment plans as well as impede foreclosure sale of the 68-acre property. A foreclosure sale was set for July 26. The report recounts the Crown Realty affiliates acquired the Mountain Shadows property in 2007 for $42 million with a $32 million loan and also assumed the development rights under a 1992 agreement. However, the owners? plans to immediately ramp up revitalization efforts were stalled as the economic downturn hit shortly after the acquisition, court records show. U.S. Bank is represented in the case by: Steven D. Jerome, Esq. Evans O'Brien, Esq. SNELL & WILMER L.L.P. One Arizona Center 400 E. Van Buren Phoenix, AZ 85004-2202 Tel: (602) 382-6000 Fax: (602) 382-6070 E-mail: sjerome@swlaw.com eobrien@swlaw.com MTS Land LLC and MTS Golf LLC, doing business as Mountain Shadows Golf Club, filed Chapter 11 petitions (Bankr. D. Ariz. Case Nos. 12-16257 and 12-16257) in Phoenix on July 19, 2012. Mountain Shadows Golf Club -- http://www.mountainshadowsgolfclub.com/-- is an 18 hole, par 56 course located at Paradise Valley. Nestled in the foothills of Camelback Mountain, the 3,081-yard Executive course claims to be one of the most scenic golf courses in Arizona. MTS Land and MTS Golf each estimated assets and debts of $10 million to $50 million. Judge Charles G. Case II oversees the Debtors' cases. Lawyers at Gordon Silver serve as the Debtors' counsel. The petition was signed by Robert A. Flaxman, administrative agent. MTS GOLF: Sec. 341 Creditors' Meeting Set for Aug. 21 ----------------------------------------------------- The Office of the U.S. Trustee in Phoenix, Arizona, will convene a Meeting of Creditors under 11 U.S.C. Sec. 341(a) in the Chapter 11 cases of MTS Land LLC and MTS Golf LLC, doing business as Mountain Shadows Golf Club, on Aug. 21, 2012, at 11:30 a.m. at US Trustee Meeting Room, 230 N. First Avenue, Suite 102, in Phoenix. MTS Land LLC and MTS Golf LLC own and operate the now dormant Mountain Shadows Golf Club. They filed separate Chapter 11 petitions (Bankr. D. Ariz. Case Nos. 12-16257 and 12-16257) in Phoenix on July 19, 2012. Mountain Shadows Golf Club -- http://www.mountainshadowsgolfclub.com/-- is an 18 hole, par 56 course located at Paradise Valley. Nestled in the foothills of Camelback Mountain, the 3,081-yard Executive course claims to be one of the most scenic golf courses in Arizona. MTS Land and MTS Golf are affiliates of Irvine, Calif.-based Crown Realty & Development Inc. MTS Land and MTS Golf each estimated assets and debts of $10 million to $50 million. Judge Charles G. Case II oversees the Debtors' cases. Lawyers at Gordon Silver serve as the Debtors' counsel. The petition was signed by Robert A. Flaxman, administrative agent. Lender U.S. Bank is represented in the case by Snell & Wilmer L.L.P. MUSCLEPHARM CORP: Board of Directors Expanded to 5 Members ---------------------------------------------------------- MusclePharm Corporation announced an expansion of its board of directors to five members from two. Cory Gregory, co-founder of the Company, resigned from the Board effective July 19, 2012. Mr. John Bluher will be Co-Chairman of the Board with Brad J. Pyatt, a founder and principal executive officer of the Company. Joining the board are Gordon G. Burr, Jr., and Donald W. Prosser, who both are independent directors, along with and Mr. Bluher, executive vice president and chief operating officer of MusclePharm, and Mark E. Groussman, a consultant. Mr. Bluher also has become co-chairman, along with Bradley J. Pyatt, chief executive officer of MusclePharm, who has served as chairman since co-founding the company nearly ten years ago. Board member and company co-founder Cory Gregory, effective July 19, 2012, has stepped down from the board and will continue to serve as president. "Our new board members will add depth and experience to MusclePharm, as the company enters an exciting new stage of growth and development," Pyatt said. "I extend special thanks to our co- founder Cory Gregory for his service and contributions to MusclePharm?s board. We look forward to Cory?s continued, valued role as president." Added Bluher, "The board additions represent an important step in our corporate restructuring. The expansion is part of our positioning to qualify for and eventually list the company's securities on a national stock exchange." Mr. Burr currently is chief executive officer of Video Gaming Services, Inc., Denver; Prosser is chief executive officer of Arete Industries, Inc., a publicly-traded company based in Westminster, CO, that holds oil and gas properties in the Rocky Mountain region; and Groussman is an investment professional and principal of Boca Raton-based Bull Hunter Inc. A copy of the Form 8-K is available for free at: http://is.gd/5Ttcxc About MusclePharm Headquartered in Denver, Colorado, MusclePharm Corporation (OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life- style company that develops and manufactures a full line of National Science Foundation approved nutritional supplements that are 100% free of banned substances. MusclePharm is sold in over 120 countries and available in over 5,000 U.S. retail outlets, including GNC and Vitamin Shoppe. MusclePharm products are also sold in over 100 online stores, including bodybuilding.com, Amazon.com and Vitacost.com. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Berman & Company, P.A., in Boca Raton, Florida, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has a net loss of $23,280,950 and net cash used in operations of $5,801,761 for the year ended Dec. 31, 2011; and has a working capital deficit of $13,693,267, and a stockholders' deficit of $12,971,212 at Dec. 31, 2011. The Company's balance sheet at March 31, 2012, showed $7.55 million in total assets, $24.76 million in total liabilities, and a $17.21 million total stockholders' deficit. The Company's restated statement of operations reflects a net loss of $23.28 million in 2011, compared with a net loss of $19.56 million in 2010. NASHVILLE BILTMORE: Files for Chapter 11 Bankruptcy Protection -------------------------------------------------------------- Duane W. Gang at The Tennessean reports that Nashville Biltmore LP, which is behind the Biltmore Ridges development project, has filed for Chapter 11 bankruptcy protection in federal bankruptcy court in the Eastern District of Texas. According to the report, the Biltmore Ridges plan calls for 441 single-family homes, 576 townhomes, 380 multifamily units, 236,500 square feet of office space, 521,000 square feet of retail space, 10,500 square feet of restaurant space and 275 hotel rooms. The project site is south of McCrory Lane. The report relates, in October, the Metro Council approved an unusual arrangement to pay for the road, utility and other infrastructure improvements needed to support the massive development. Under the deal, a special assessment or tax would be levied on all property within the Biltmore Ridges development. Revenue from the tax would pay for more than $18.1 million in improvements, including widening a ramp to Interstate 40, relocating electrical lines and constructing a 2-million-gallon water storage tank. The report notes Metro Councilman Bo Mitchell, who represents the Bellevue area, said he learned of the bankruptcy and was told the company had difficulty renegotiating a loan. Based in Plano, Texas, Nashville Biltmore LP engages in housing and commercial development. The Company filed for Chapter 11 protection on July 19, 2012 (Bankr. E.D. Tex. Case No. 12-41933). Judge Brenda T. Rhoades presides over the case. Joyce W. Lindauer, Esq., represents the Debtor. The Debtor estimated both assets and debts of between $1 million and $10 million. NAKNEK ELECTRIC: Has $6 Million Loan to Fund Fuel Purchase ---------------------------------------------------------- Naknek Electric Association, Inc., has up to $6 million debtor-in- possession financing to purchase its 2012-2013 fuel from National Rural Utilities Cooperative Finance Corporation (CFC), according to an order entered by the bankruptcy judge at the end of May. The purpose of the 2012 DIP Fuel Loan is to permit NEA to purchase and ship the diesel fuel it needs to generate electricity. CFC has agreed to loan NEA the funds it needs to purchase the fuel on essentially the same terms as was approved in the DIP Fuel Loan Order last May 2011. As in the loan agreement for the 2011-2012 purchase, CFC requires that the security interests of RUS in the non-geothermal assets be subordinated to the security interest the Debtor intends to grant CFC for the 2012 fuel loan. About Naknek Electric Association Naknek, Alaska-based Naknek Electric Association, Inc., operates a diesel power generation plant, storage and distribution system on approximately 9.34 acres of land it owns in Naknek, Alaska. It provides electricity to 591 members of the cooperative. It also is developing a geothermal well. Naknek Electric filed for Chapter 11 bankruptcy protection (Bankr. D. Alaska Case No. 10-00824) on Sept. 29, 2010. Erik LeRoy, Esq., at Erik Leroy P.C., assists the Debtor in its restructuring effort. The Debtor disclosed $21,459,632 in assets and $7,523,708 as of the Chapter 11 filing. The Debtor filed with the Bankruptcy Court a plan of reorganization and an accompanying disclosure statement on Sept. 15, 2011. The Plan proposed that the Debtor will pay Class 13, unsecured creditors, $3 million over 60 months commencing on the Effective Date. Based on the current claims filed in the case, the proposed payment will pay unsecured creditors a dividend of about $0.10 on each dollar of claim. A committee of unsecured creditors has been appointed by the United States Trustee. NATIONAL HOLDINGS: Receives Add'l $2 Million Financing from NSGP ---------------------------------------------------------------- National Holdings Corporation announced an agreement to receive an additional $2 million in financing pursuant to an amendment of the previously announced Securities Purchase Agreement dated March 30, 2012, which would represent an aggregate total of $6 million debt investment into the Company from an investment group, National Securities Growth Partners, LLC, the primary principals of which are Robert Fagenson, Bryant Riley, and Mark Klein. Upon the closing of this transaction, Robert Fagenson and Mark Klein will also take on the role of Co-Executive Chairmen of the Company. Mark Goldwasser will continue to serve as CEO. The Company also announed that Leonard Sokolow, who had advised the Board of his contemplated resignation prior to this agreement, will continue to serve as non-executive Vice-Chairman and will be a consultant to Company for a minimum of 18 months. The Company will use $1.2 million of the additional $2 million in proceeds from the financing in partial satisfaction of indebtedness held by affiliates of St. Cloud Capital Partners II, L.P., evidenced by the 10% senior subordinated convertible promissory note in the original principal amount of $3 million, leaving a balance of $1.8 million with a maturity date that will be extended to Jan. 31, 2013. "We remain excited as we become significant investors in the Company, which is a top 40 financial services firm nationwide. With annual revenues approaching $130 million and over 1,000 independent brokers, advisors and associated personnel, we believe that National is extremely well positioned to grow and take advantage of the many strategic opportunities that currently exist in the financial services industry, including the ability to expand and enhance its presence in retail and institutional brokerage, corporate finance and investment advisory services," said Robert Fagenson, current Chairman. Mark Klein stated, "National has managed its business through one of the most difficult periods in the history of the financial services industry and this agreement to extend the maturity date of the St. Cloud Capital Partners II, L.P. note reflects a recognition of the extraordinary management efforts of Mark Goldwasser, CEO, and Leonard Sokolow, Vice Chairman, coupled with confidence that the National management team will continue to demonstrate their ability to reduce costs, rationalize operations, attract brokers and build upon our already strong and valuable financial services business." "We are extremely pleased with this financing which will help us to build greater value for our shareholders," stated Mark Goldwasser, CEO, who continued, "We also believe that the addition of the Robert Fagenson and Mark Klein as Co-Executive Chairmen with their deep industry experience will be a catalyst to capture strategic and consolidation opportunities growing and diversifying our revenue base and furthering our overall growth and operational strategy." About National Holdings New York, N.Y.-based National Holdings Corporation is a financial services organization, operating primarily through its wholly owned subsidiaries, National Securities Corporation, Finance Investments, Inc., and EquityStation, Inc. The Broker-Dealer Subsidiaries conduct a national securities brokerage business through their main offices in New York, New York, Boca Raton, Florida, and Seattle, Washington. The Company had a net loss of $4.7 million on $126.5 million of total revenues for fiscal year ended Sept. 30, 2011, compared with a net loss of $6.6 million on $111.0 million on total revenues for fiscal 2010. The Company's balance sheet at March 31, 2012, showed $18.21 million in total assets, $22 million in total liabilities, $15,000 in non-controlling interest, and a $3.80 million stockholders' deficit. In the auditors' report accompanying the consolidated financial statements for the year ended Sept. 30, 2011, Sherb & Co., LLP, in Boca Raton, Florida, expressed substantial doubt about National Holdings' ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses and has a working capital deficit as of Sept. 30, 2011. Bankruptcy Warning The Company said its quarterly report for the period ended March 31, 2012, that its future is dependent on its ability to sustain profitability and obtain additional financing. If the Company fails to do so for any reason, it would not be able to continue as a going concern and could potentially be forced to seek relief through a filing under the U.S. Bankruptcy Code. NET TALK.COM: Extends Maturity of Senior Debentures to 2013 ----------------------------------------------------------- Net Talk.com, Inc., finalized extending the maturity date to Dec. 31, 2013, for each of (i) certain 12% Senior Secured Debenture in the aggregate principal amount of $7,266,130, (ii) certain 12% Senior Secured Debenture in the aggregate principal amount of $4,950,000, and (iii) the Company's authorized Series A Convertible Preferred Stock. That extension agreement is effective as of June 30, 2012. On July 19, 2012, the Company finalized that certain Securities Option Agreement with Vicis Capital Master Fund, which grants the Company the right to purchase, upon the satisfaction of certain conditions, preferred stock, common stock and warrants owned by Vicis Capital Master Fund. That option agreement is effective as of June 30, 2012. The Company amended the Preferences, Privileges and Restrictions for its authorized Series A Convertible Preferred Stock to, among other matters, extend the maturity date from July 1, 2013, to Dec. 31, 2013. About Net Talk.com Based in Miami, Fla., Net Talk.com, Inc., is a telephone company, who provides, sells and supplies commercial and residential telecommunication services, including services utilizing voice over internet protocol technology, session initiation protocol technology, wireless fidelity technology, wireless maximum technology, marine satellite services technology and other similar type technologies. The Company reported a net loss of $26.17 million $2.72 million of revenue for the year ended Sept. 30, 2011, compared with a net loss of $6.30 million on $737,498 of revenue during the prior year. The Company's balance sheet at March 31, 2012, showed $6.64 million in total assets, $12.46 million in total liabilities, $9.19 million in redeemable preferred stock, and a $15 million total stockholders' deficit. NEW YORK TIMES: S&P Revises Outlook on 'B+' CCR to Stable --------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on New York City-based The New York Times Co. to stable from positive. "At the same time, we affirmed all existing ratings on the company, including the 'B+' corporate credit rating," S&P said. "The outlook revision to stable reflects our expectation that the timeframe for a potential upgrade lies beyond the next 12 months," said Standard & Poor's credit analyst Hal Diamond. "Growth in high-margin digital advertising revenue, which is needed to offset the secular decline in print advertising revenue, has halted. Newspaper digital ad revenues declined 1.9% in the first half of 2012, after having increased 5.3% in 2011 and 18.3% in 2010." "We expect that continued secular pressure on the print business will mean that sustained digital revenue increases will be needed for the company to generate consolidated revenue and EBITDA growth," added Mr. Diamond. "Standard & Poor's rating on The New York Times reflects the company's exposure to unfavorable secular trends affecting newspaper print advertising and circulation. The company's business risk profile is 'weak' because of these risks, notwithstanding the significant national presence and brand equity of the 'New York Times' newspaper. These two factors were crucial supports to its March 2011 launch of a digital subscription model charging heavy users. We view the company's financial risk as 'aggressive' because of pressure on the company's debt leverage and large underfunded pension obligation," S&P said. "The stable outlook reflects our expectation that neither an upgrade nor a downgrade are likely in the coming 12-18 months. We see the potential that long-term credit profile improvement could be hampered by continued secular pressure on the business, despite efforts at the development of new digital revenue," S&P said. "We could lower the rating to 'B' if the trends of newspaper ad revenue declines accelerate, necessitating ongoing restructuring charges, and contributing to shrinkage of EBITDA, the EBITDA margin, and minimal discretionary cash flow. This scenario could transpire if revenue declines roughly 10%, while EBITDA falls about 30%, reflecting the difficulty of eliminating fixed costs. Additional potential elements of a downgrade scenario could involve management decisions to reinvest a large portion of its cash flow in high-priced acquisitions, sizable share repurchases, or material dividends, which we currently do no anticipate," S&P said. "We would consider an upgrade to 'BB-' if it can develop traction in digital revenues that permit the digital business to fully offset publishing revenue declines, leading to EBITDA growth, and the company continues to balance shareholder returns and acquisitions with debt repayment," S&P said. NORTEL NETWORKS: CCAA Stay Period Extended to Oct. 31 ----------------------------------------------------- Nortel Networks Corporation disclosed that it, its principal operating subsidiary Nortel Networks Limited and its other Canadian subsidiaries that filed for creditor protection under the Companies' Creditors Arrangement Act (CCAA) have obtained an order from the Ontario Superior Court of Justice (Canadian Court) further extending, to Oct. 31, 2012, the stay of proceedings that was previously granted by the Canadian Court. The purpose of the stay of proceedings is to provide stability to the Nortel companies to continue with their restructuring efforts and to continue to work toward the development of a plan of arrangement under CCAA. The materials filed in the CCAA proceedings are available on the Restructuring Document Centre of Ernst & Young Inc. About Nortel Networks Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009. Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Office of the United States Trustee for the District of Delaware has appointed an Official Committee of Unsecured Creditors in respect of the Debtors, and an ad hoc group of bondholders has been organized. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. The Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Certain of Nortel's European subsidiaries also made consequential filings for creditor protection. On May 28, 2009, at the request of the Administrators, the Commercial Court of Versailles, France ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in this Court for recognition of the English Proceedings as foreign main proceedings under chapter 15 of the Bankruptcy Code. Nortel has collected almost $9 billion for distribution to creditors. Of the total, US$4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel Networks has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. OAJ LLC: Chapter 11 Case Summary & Unsecured Creditor ----------------------------------------------------- Debtor: OAJ, LLC 164 Weldon Road Palmetto, GA 30268 Bankruptcy Case No.: 12-12102 Chapter 11 Petition Date: July 26, 2012 Court: United States Bankruptcy Court Northern District of Georgia (Newnan) Debtor's Counsel: David G Bisbee, Esq. LAW OFFICE OF DAVID G. BISBEE 2929 Tall Pines Way Atlanta, GA 30345 Tel: (770) 939-4881 Fax: (770) 783-8595 E-mail: bisbeed@bellsouth.net Scheduled Assets: $2,974,857 Scheduled Liabilities: $3,196,833 In its list of 20 largest unsecured creditors, the Company placed only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hilco, Inc. $820,000 12725 Century Dr Alpharetta, GA 3009 The petition was signed by Vernon A. Hill, Jr., managing member. OSI RESTAURANT: Estimates Revenue of $980.9MM in Second Quarter --------------------------------------------------------------- OSI Restaurant Partners, LLC, is in the process of finalizing its results for the quarter ended June 30, 2012. Based on information available to date, the Company estimates that for the quarter ended June 30, 2012: * Total revenues were $980.9 million, compared to $955.5 million for the quarter ended June 30, 2011; * Combined comparable restaurant sales at the Company's domestic core concepts increased 2.4% as compared to the quarter ended June 30, 2011; * Comparable restaurant sales at Outback Steakhouse, Carrabba's, Bonefish Grill and Fleming's increased 2.3%, 1.5%, 2.1% and 6.8%, respectively, as compared to the quarter ended June 30, 2011; * Income from operations was between $38.0 million and $40.0 million, compared to $26.5 million for the quarter ended June 30, 2011; and * The Company's net income was between $15.5 million and $17.5 million, compared to $5.7 million for the quarter ended June 30, 2011. About OSI Restaurant OSI Restaurant Partners, Inc., is an operator of casual-dining spots (behind Darden Restaurants and Brinker International), with more than 1,400 locations in the U.S. and 20 other countries. Its flagship Outback Steakhouse chain boasts more than 950 locations that serve steak, chicken, and seafood in Australian-themed surroundings. OSI also operates the Carrabba's Italian Grill chain, with about 240 locations. Other concepts include Bonefish Grill, Fleming's Prime Steakhouse, and Cheeseburger In Paradise. Most of the restaurants are company owned. A group led by Chairman Chris Sullivan took the company private in 2007. The Company reported net income of $27.84 million on $3.62 billion of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $54.40 million on $3.60 billion of total revenues during the prior year. The Company's balance sheet at March 31, 2012, showed $2.49 billion in total assets, $2.43 billion in total liabilities and $58.54 million in total equity. * * * As reported by the TCR on April 19, 2012, Standard & Poor's Ratings Services raised the corporate credit rating on casual dining operator OSI Restaurant Partners LLC to 'B' from 'B-'. "The ratings on Tampa, Fla.-based OSI Restaurant Partners LLC reflect Standard & Poor's expectations that recent brand revitalization initiatives and cost savings from productivity improvements will contribute to further strengthening of credit measures in 2012, despite commodity cost pressure and weak consumer spending," said Standard & Poor's credit analyst Ana Lai. OSI RESTAURANT: Commences Tender Offer for 10% Senior Notes ----------------------------------------------------------- OSI Restaurant Partners, LLC, commenced a tender offer for all of its outstanding 10% Senior Notes due 2015 on July 25, 2012. In conjunction with the tender offer, OSI is soliciting consents from noteholders to effect certain amendments to the indenture governing the Notes. OSI is offering to purchase all of the outstanding Notes at a price of $1,028.75 per $1,000 of principal amount of Notes determined in accordance with the formula set forth in the Tender Offer Documents, which Total Consideration includes a payment of $10.00 per $1,000 principal amount of Notes. The Total Consideration, plus accrued but unpaid interest to, but not including, the date of payment for the Notes, will be paid in respect of all Notes validly tendered and accepted for purchase pursuant to the tender offer if the noteholder validly tenders those Notes prior to 5:00 p.m., New York City time, on Aug. 7, 2012, unless that date is extended. Any holder validly tendering Notes after the Consent Payment Deadline will, if those Notes are accepted for purchase pursuant to the tender offer, receive the Total Consideration, plus accrued but unpaid interest to, but not including, the date of payment for the Notes, less the Early Tender and Consent Payment for the Notes so tendered. The tender offer is scheduled to expire at 12:00 midnight, New York City time, on Aug. 21, 2012, unless extended. The tender offer is conditioned on, among other things, the following: (i) OSI will have received, on or prior to the Consent Payment Deadline, Consents which have not been revoked in respect of at least a majority in principal amount of the Notes; and (ii) Bloomin' Brands, Inc., OSI's ultimate parent company, will have consummated its initial public offering pursuant to which it receives at least $140 million in proceeds, a portion of which will be contributed to OSI and used, together with cash on hand, to purchase the Notes under the Tender Offer and pay for Consents on or prior to the initial payment date. Requests for Tender Offer Documents may be directed to Global Bondholder Services Corporation, as information agent for the tender offer, at 65 Broadway - Suite 404, New York, New York 10006. The information agent may be telephoned at 866-873-5600 or facsimile at 212-430-3779. The dealer manager and solicitation agent for the tender offer is BofA Merrill Lynch. Questions regarding the tender offer and consent solicitation may be directed to the dealer manager and solicitation agent, Attention: Debt Advisory Services, at One Bryant Park, New York, NY 10036. The dealer manager and solicitation agent may be telephoned toll- free at 888-292-0070 or collect at 646-855-3401 or facsimile at 646-855-5028. About OSI Restaurant OSI Restaurant Partners, Inc., is an operator of casual-dining spots (behind Darden Restaurants and Brinker International), with more than 1,400 locations in the U.S. and 20 other countries. Its flagship Outback Steakhouse chain boasts more than 950 locations that serve steak, chicken, and seafood in Australian-themed surroundings. OSI also operates the Carrabba's Italian Grill chain, with about 240 locations. Other concepts include Bonefish Grill, Fleming's Prime Steakhouse, and Cheeseburger In Paradise. Most of the restaurants are company owned. A group led by Chairman Chris Sullivan took the company private in 2007. The Company reported net income of $27.84 million on $3.62 billion of total revenues for the year ended Dec. 31, 2010, compared with a net loss of $54.40 million on $3.60 billion of total revenues during the prior year. The Company's balance sheet at March 31, 2012, showed $2.49 billion in total assets, $2.43 billion in total liabilities and $58.54 million in total equity. * * * As reported by the TCR on April 19, 2012, Standard & Poor's Ratings Services raised the corporate credit rating on casual dining operator OSI Restaurant Partners LLC to 'B' from 'B-'. "The ratings on Tampa, Fla.-based OSI Restaurant Partners LLC reflect Standard & Poor's expectations that recent brand revitalization initiatives and cost savings from productivity improvements will contribute to further strengthening of credit measures in 2012, despite commodity cost pressure and weak consumer spending," said Standard & Poor's credit analyst Ana Lai. PENN TREATY: Board Approves Changes to Directors' Compensation -------------------------------------------------------------- The Board of Directors approved certain changes to the compensation of Penn Treaty American Corporation's directors. The directors' compensation was changed to provide for a monthly retainer of $1,100 for each director and $1,650 for the Chairman of the Board, plus meeting fees of $1,500 for each director for each Board meeting attended in person and $750 for each director for each Board meeting attended by telephone. Directors serving on Board committees will receive $500 per committee meeting they attend. Members of the Compensation Committee will receive $1,000 per meeting attended, including attendance by telephone, and the Chair of the Compensation Committee will receive $1,600 per meeting attended, including attendance by telephone. The Chairs of the Audit, Corporate Governance/Nominating, Investment, and Marketing Committees will receive $1,000 per meeting attended. The Board, upon the recommendation of the Compensation Committee, also approved certain payments to William W. Hunt Jr., Eugene Woznicki, and Sean Mullen for their extraordinary efforts during the liquidation and rehabilitation proceedings of Penn Treaty Network America Insurance Company and American Network Insurance Company, as well as their efforts assisting with the PTNA federal tax refund litigation. Mr. Hunt, a director, received a one-time payment of $100,000. Effective as of Aug. 1, 2012, Mr. Hunt will also receive compensation of $4,000 per month, in lieu of his former compensation of $100 per hour, for his work in assisting with the rehabilitation of PTNA and ANIC. Mr. Woznicki, the Company's Chairman of the Board and Chief Executive Officer, received a one-time payment of $200,000. Effective as of Aug. 1, 2012, Mr. Woznicki will also receive compensation of $13,000 per month for his work in assisting with the rehabilitation of PTNA and ANIC and $3,200 per month for administrative expenses relating to the business of the Company. Mr. Sean Mullen, the Company's Chief Financial Officer, received a one-time payment of $50,000. In addition to his unchanged $8,000 monthly compensation, Mr. Mullen will receive $275 per hour for each hour Mr. Mullen works per month over 30 hours, effective as of Aug. 1, 2012, for his work in assisting with the rehabilitation of PTNA and ANIC. Penn Treaty previously announced that effective as of Jan. 6, 2009, two of the Company's insurance subsidiaries, PTNA and ANI, by consent and by order of the Commonwealth Court of Pennsylvania, entered rehabilitation and had been placed under the statutory control of the Insurance Commissioner of the Commonwealth of Pennsylvania. On May 3, 2012, the Commonwealth Court of Pennsylvania issued an order denying the liquidation petitions for PTNA and ANIC. PTNA and ANIC will remain for some periods of time in rehabilitation. Rehabilitation efforts will involve substantial additional work and action by the Board and by Messrs. Woznicki, Mullen and Hunt. There can be no assurance as to when PTNA and ANIC will come out of rehabilitation, or if they will come out of rehabilitation at all. About Penn Treaty American Penn Treaty American Corporation -- https://www.penntreaty.com/ -- through its wholly owned direct and indirect subsidiaries, Penn Treaty Network America Insurance Company, American Network Insurance Company, American Independent Network Insurance Company of New York, Network Insurance Senior Health Division and Senior Financial Consultants Company, is engaged in the underwriting, marketing and sale of individual and group accident and health insurance products, principally covering long term nursing home and home health care. On Oct. 2, 2009, the Insurance Commissioner of the Commonwealth of Pennsylvania filed in the Commonwealth Court of Pennsylvania Petitions for Liquidation for PTNA and American Network Insurance Company. PTNA is a direct insurance company subsidiary of Penn Treaty American Corporation, and ANIC is a subsidiary of PTNA. PHILADELPHIA NEWSPAPERS: Defamation Claimants Lose 3rd Cir. Fight ----------------------------------------------------------------- The U.S. Court of Appeals for the Third Circuit rejected an appeal lodged by Vahan H. Gureghian, Danielle Gureghian, and Charter School Management, Inc., which collectively sued Philadelphia Media Holdings, LLC, The Philadelphia Inquirer, and several Inquirer employees in the Court of Common Pleas of Delaware County, Pennsylvania, concerning certain articles published in print and online by the Inquirer discussing the CSMI Parties' contract management of the Chester Community Charter School. The CSMI Parties assert that post-petition the Debtors published an article that links to and endorses the Articles. In their defamation suit, the CSMI Parties alleged that pre- bankruptc the Debtors published a charter school webpage that contained links to various items published by the Inquirer about charter schools. They claimed that the links endorsed the Articles as accurate reporting and misled the public into believing that the CSMI Parties engaged in wrongdoing similar to the improper or illegal conduct alleged in other linked news items. They also highlighted that the Articles were displayed beneath the Charter Page's title bar as a "marquee" enclosed in a separate box containing photographs, thereby drawing attention to the Articles. They further alleged that post-petition the Debtors published an editorial article titled "Not the Lessons Charters Were Supposed to Teach" by Inquirer columnist Monica Yant Kinney. It contained a link to and a statement endorsing the Charter Page. The Kinney Article read: "Some city charter schools -- think Mastery, KIPP, Independence, Young Scholars -- are soaring. But if you follow the remarkable reporting of my colleague Martha Woodall (http://go.philly.com/charter),you'll see greedy grown-ups pilfering public gold under the guise of enriching children's lives." The CSMI Parties argue that this link and statement "republished" the Articles. On Aug. 2, 2010, they timely filed administrative expense requests based on these allegations. Each request asserted an estimated claim of $1,800,000 for the Debtors' alleged post-petition act of defamation. Each also sought $147,140 in alleged damages for the Debtors' post-petition conduct and prosecution of claims against the CSMI Parties. The Debtors objected. Bankruptcy Judge Stephen Raslavich later denied the requests, saying the CSMI Parties had not sustained their burden of proof in establishing entitlement to an administrative expense claim. The CSMI Parties appealed to the District Court. They argued that the Bankruptcy Court erred in denying the administrative claims requests because the Kinney Article's link and reference to the Charter Page provided a post-petition tort claim. They also asserted that the Bankruptcy Court prejudged the merits of the requests and infringed on their due process rights by forcing them to proceed on an expedited basis. The Debtors argued that the appeal should be dismissed as equitably moot. The District Court held that the appeal was equitably moot, "as the plan has been substantially consummated and no stay was sought," but nonetheless considered the merits. After noting that courts often provide their preliminary impressions on matters to narrow issues and that expedited hearings are "commonplace and often necessary" in bankruptcy proceedings, it considered the claims underlying the administrative expense requests. It affirmed the Bankruptcy Court's denial of the requests based on its holding that "merely post[ing] a link to the charter school webpage that contained the original articles . . ., as the courts that have had occasion to consider this issue have uniformly held, is not distinct tortious conduct upon which a defamation claim can be grounded." The CSMI Parties elevated the matter to the Third Circuit. Circuit Judge Thomas L. Ambro, who wrote the Opinion, held that the appeal is not equitably moot. However, the Third Circuit affirmed the District Court's ruling, saying that tough the Kinney Article's link may allow for easy access to the Charter Page, and the reference may speak favorably of the items collected by the Charter Page, including the Articles regarding the CSMI Parties, they do not amount to a restatement or alteration of the allegedly defamatory material in the Articles necessary for a republication. The Bankruptcy and District Courts were correct in sustaining the Debtors' objection to the administrative expense requests on the basis that the CSMI Parties cannot advance a sustainable cause of action to support the requests. The Third Circuit also noted that several courts have considered whether linking to previously published material is republication. To date, they all hold that it is not, based on a determination that a link is akin to the release of an additional copy of the same edition of a publication because it does not alter the substance of the original publication. The appellate case is, Vahan H. Gureghian, Danielle Gureghian, and Charter School Management, Inc., Appellants, No. 11-3257 (3rd Cir.). A copy of the Third Circuit's July 26, 2012 Opinion is available at http://is.gd/giLz15from Leagle.com. About Philadelphia Newspapers Philadelphia Newspapers, LLC -- http://www.philly.com/-- owned and operated numerous print and online publications in the Philadelphia market, including the Philadelphia Inquirer, the Philadelphia Daily News, several community newspapers, the region's number one local Web site, philly.com, and a number of related online products. The Company's flagship publications were the Inquirer, the third oldest newspaper in the country and the winner of numerous Pulitzer Prizes and other journalistic recognitions, and the Daily News. Philadelphia Newspapers and its debtor-affiliates filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No. 09-11204) on Feb. 22, 2008. Proskauer Rose LLP is the Debtors' bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth Paxson LLP is the local counsel. The Debtors' financial advisor is Jefferies & Company Inc. Philadelphia Newspapers estimated assets and debts of $100 million to $500 million in its Chapter 11 petition. The Debtors proposed a plan of reorganization which would sell substantially all of their assets at an auction. The Philadelphia Media Network, which was formed by the Debtors' secured lenders, acquired the Philadelphia Inquirer, the Daily News and Philly.com for $105 million in cash. The Court approved the sale and confirmed a revised plan at a hearing on Sept. 30. Philadelphia Newspapers previously won confirmation of a plan based on the sale of the business to the same group of lenders for $139 million. The sale failed to close because the buyers weren't able to reach agreement on a new labor contract with the Teamsters union. After another auction on Sept. 23, the lenders again emerged as the winning bidder but with a lower offer. The Plan became effective and the sale closed on Oct. 8, 2010. PINNACLE AIRLINES: Taps Deloitte Tax to Provide Advisory Services ----------------------------------------------------------------- Pinnacle Airlines Corp., et al., ask the U.S. Bankruptcy Court for the Southern District of New York for permission to employ Deloitte Tax LLP as their tax advisor. Deloitte Tax will provide these services: -- tax advisory services from Jan. 1, 2012, until Dec. 31, 2012, on federal, state and local tax matters on an as- requested basis, including, consistent with the terms of the applicable Prepetition Engagement Letter; -- calculation of income tax provision and current and deferred income tax asset and liability accounts; -- preparation of required disclosures under the provisions of ASC 740, Income Taxesfor the year ended Dec. 31, 2011, and until the Debtors' interim reporting period ending Sept. 30, 2012, including any interim reporting periods during the time. The Debtors have employed Deloitte Tax as their tax advisor since the year 2002. Deloitte Tax had prepared the Debtors' 2011 tax filings prior to the Petition Date. For the Services provided pursuant to the Prepetition Engagement Letters, Deloitte Tax will be compensated based on time incurred at 65% of Deloitte Tax's applicable standard rates. These rates, by classification of professional, are: Partner, Principal or Director $497 Senior Manager $438 Manager $357 Senior $293 Staff $225 For the Services provided pursuant to the May Engagement Letter, the estimated fees and expenses for the preparation of the tax returns will be $110,000, plus reasonable out-of-pocket expenses for costs incurred. Additionally, if Deloitte Tax finds that there is an increased level of complexity or if additional services are necessary in order to complete the returns the May Engagement Letter, Deloitte Tax will consult the Debtors to discuss the billing arrangements related to the out-of-scope services. Fees for preparation of any additional state and local tax returns not listed in Exhibit A will be $1,300 for each separate return and between $2,000 and $3,000 for each combined return based on the level of information requested on the tax return. For the Services provided pursuant to the June Engagement Letter, Deloitte Tax will be compensated based on Deloitte Tax's agreed hourly rates for the services. These rates, by classification of professional, are: National Tax Title Local and Bankruptcy Specialists Partner, Principal or Director $497 $591 Senior Manager $438 $502 Manager $357 $412 Senior $283 $336 Staff $225 $264 To the best of the Debtors' knowledge, Deloitte Tax is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A hearing on Aug. 7, 2012, at 10 a.m. has been set. Objections, if any, are due July 31, at 4:00 p.m. About Pinnacle Airlines Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/-- a $1 billion airline holding company with 7,800 employees, is the parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.; and Colgan Air, Inc. Flying as Delta Connection, United Express and US Airways Express, Pinnacle Airlines Corp. operating subsidiaries operate 199 regional jets and 80 turboprops on more than 1,540 daily flights to 188 cities and towns in the United States, Canada, Mexico and Belize. Corporate offices are located in Memphis, Tenn., and hub operations are located at 11 major U.S. airports. Pinnacle Airlines Inc. and its affiliates, including Colgan Air, Mesaba Aviation Inc., Pinnacle Airlines Corp., and Pinnacle East Coast Operations Inc. filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Lead Case No. 12-11343) on April 1, 2012. Judge Robert E. Gerber presides over the case. Lawyers at Davis Polk & Wardwell LLP, and Akin Gump Strauss Hauer & Feld LLP serve as the Debtors' counsel. Barclays Capital and Seabury Group LLC serve as the Debtors' financial advisors. Epiq Systems - Bankruptcy Solutions serves as the claims and noticing agent. The petition was signed by John Spanjers, executive vice president and chief operating officer. Pinnacle Airlines' balance sheet at Sept. 30, 2011, showed $1.53 billion in total assets, $1.42 billion in total liabilities and $112.31 million in total stockholders' equity. Debtor-affiliate Colgan Air, Inc. disclosed $574,482,867 in assets and $479,708,060 in liabilities as of the Chapter 11 filing. Delta Air Lines, Inc., the Debtors' major customer and post- petition lender, is represented by David R. Seligman, Esq., at Kirkland & Ellis LLP. A seven-member official committee of unsecured creditors has been appointed in the case. The Committee selected Goodrich Corporation as its chairperson. The Committee tapped Morrison & Foerster LLP as its counsel. The Committee tapped Donlin, Recano & Company as its administrative agent. POLYMER GROUP: Moody's Affirms 'B1' CFR/PDR; Outlook Stable ----------------------------------------------------------- Moody's Investors Service has assigned an SGL-2 Speculative Grade Liquidity Rating to Polymer Group, Inc. The short-term liquidity rating indicates good liquidity to support operations in the near- term. Moody's also affirmed the company's existing long-term credit ratings, including the B1 Corporate Family Rating ("CFR"), B1 Probability of Default Rating, and B1 rating on the $560 million Senior Secured Notes due 2019. The rating outlook is stable. "Polymer Group has over $115 million of available liquidity to support its global operations," said Moody's analyst Ben Nelson. The company reported about $80 million of balance sheet cash at March 31, about $25 million of borrowing capacity on its undrawn domestic asset-based revolving credit facility, and additional availability under various domestic and international receivables factoring programs. Moody's expects sufficient cash flow to cover all basic cash requirements, but discretionary capital spending will continue to limit free cash flow generation in the near-term. Moody's does not expect the springing fixed charge covenant on the revolver, which is the company's only meaningful financial maintenance covenant, will be tested over the next four quarters. In addition, a substantial portion of the company's assets are held in foreign subsidiaries, unsecured, and could provide an alternate source of liquidity in a distressed scenario. Actions: Issuer: Polymer Group, Inc. Speculative Grade Liquidity Rating, Assigned SGL-2 Corporate Family Rating, Affirmed B1 Probability of Default Rating, Affirmed B1 $560 million Senior Secured Notes due 2019, Affirmed B1 (LGD3 48%; revised from LGD4 51%) Outlook, Stable Ratings Rationale The affirmation of the long-term credit ratings acknowledges PGI's success in managing through challenging end market conditions and volatile input costs, restructuring and expanding its asset base, and positioning the company for improved cash flow generation in the intermediate term. Moody's expects free cash flow will improve to near breakeven levels in 2012 and into the low-to-mid single digit percentage of debt range in 2013. The B1 CFR reflects high financial leverage, expectations for modest free cash flow, and some degree of cyclicality from industrial end markets, moderate customer concentration, and excess capacity at the industry level. The rating is supported by the company's scale, geographic diversification, exposure to high- growth geographies, recession-resistant demand of consumer disposable end markets, and a demonstrated ability to pass through commodity input costs. These factors lend stability to the company's EBITDA generation and support the rating despite relatively high financial leverage near 5 times Debt/EBITDA. Good liquidity, as evidenced by the SGL-2 short term liquidity rating, is a key factor underpinning the rating given modest cash flow expectations and high leverage. The stable outlook assumes that PGI will maintain a good liquidity profile over the near-term and, despite meaningful capital spending plans, continue to grow its earnings and cash flow. Positive rating momentum could surface if PGI reduces financial leverage to below 3 times or increases free cash flow to debt to above 10%, while maintaining a good liquidity profile. Conversely, the rating or outlook could be lowered if sales volumes or margins weaken materially or if financial leverage and free cash flow to debt are sustained above 5 times or below 3%, respectively. Shareholder-friendly activities, such as acquisitions or distributions using debt, or deteriorating liquidity could also have negative rating implications. The principal methodology used in rating Polymer Group was the Global Manufacturing Industry Methodology published in December 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Charlotte, North Carolina, Polymer Group, Inc. is one of the world's leading producers of nonwoven materials sold to makers of consumer and industrial products. End uses include disposable diapers, feminine hygiene products, cleaning wipes, surgical gowns & drapes, and furniture & bedding, among others. PGI is privately owned by the Blackstone Group and generated revenues of $1.2 billion in the twelve months ended March 31, 2012. PORTER BANCORP: Incurs $319,000 Net Loss in Second Quarter ---------------------------------------------------------- Porter Bancorp, Inc., reported a net loss available to common shareholders of $319,000 on $10.79 million of net interest income for the three months ended June 30, 2012, compared with a net loss available to common shareholders of $38.96 million on $13.44 million of net interest income for the same period a year ago. The Company reported net income available to common shareholders of $661,000 on $22.24 million of net interest income for the six months ended June 30, 2012, compared with a net loss available to common shareholders of $38.60 million on $27.21 million of net interest income for the same period during the prior year. The Company's balance sheet at June 30, 2012, showed $1.33 billion in total assets, $1.25 billion in total liabilities and $81.50 million in stockholders' equity. A copy of the press release is available for free at: http://is.gd/baHIsA About Porter Bancorp Porter Bancorp, Inc., is a bank holding company headquartered in Louisville, Kentucky. Through its wholly-owned subsidiary PBI Bank, the Company operates 18 full-service banking offices in twelve counties in Kentucky. Crowe Horwath, LLP, in Louisville, Kentucky, audited Porter Bancorp's financial statements for 2011. The independent auditors said that the Company has incurred substantial losses in 2011, largely as a result of asset impairments. "In addition, the Company's bank subsidiary is not in compliance with a regulatory enforcement order issued by its primary federal regulator requiring, among other things, increased minimum regulatory capital ratios. Additional significant asset impairments or continued failure to comply with the regulatory enforcement order may result in additional adverse regulatory action." The Company reported a net loss of $107.31 million in 2011, compared with a net loss of $4.38 million in 2010. PORTER BANCORP: Names John Taylor President and CEO of PBI Bank --------------------------------------------------------------- Porter Bancorp, Inc., parent company of PBI Bank, announced that John T. Taylor has been named President and CEO of PBI Bank and President of Porter Bancorp, Inc. Mr. Taylor will also be appointed to the board of directors of both Porter Bancorp and PBI Bank. Maria L. Bouvette, who previously served as President of Porter Bancorp and President and CEO of PBI Bank, will continue to serve as Chief Executive Officer and Chairman of the Board for Porter Bancorp, and Chairman of the Board of PBI Bank. "We are very pleased that John Taylor has joined PBI Bank as our new President and CEO and as President of Porter Bancorp," stated Maria L. Bouvette, CEO of Porter Bancorp. "Our Board's search committee identified John early in the process because of his knowledge of our Kentucky markets, his expertise in credit management and special assets and his experience as President and CEO of a bank in one of our markets. As the new CEO for PBI Bank, he will be responsible for leading the bank through the challenging economic environment, reducing the level of non- performing assets, and growing earnings while maintaining our high level of quality service for our customers. "John has a solid history of building organizations with a clear vision and strategy to build long-term enterprise value. He also has strong roots in Kentucky, with significant experience in our key markets. He is a graduate of the University of Kentucky and also served as President of the Kentucky/Ohio region for a major regional bank. We are looking forward to his leadership in improving our profitability and building long-term shareholder value." Mr. Taylor, age 52, most recently served as President and CEO of American Founders Bank, Inc., and American Founders Bancorp, Inc., of Lexington, Kentucky. Prior to joining American Founders in 2007, he served in senior management positions with increasing responsibility for PNC Bank, N.A., including as President of its Ohio/Northern Kentucky region for six years. He has over 28 years of banking experience in Kentucky and Ohio. He holds a Master's Degree in Business Administration and a Bachelor's Degree in Business Administration from the University of Kentucky. Mr. Taylor is actively involved in a number of civic and professional organizations and currently serves on the Advisory Council of the Lexington Federal Reserve. In connection with Mr. Taylor's appointment to these positions, Porter Bancorp and PBI Bank expect to enter into an employment agreement with Mr. Taylor, when the terms of the agreement receive requisite approvals by the Federal Deposit Insurance Corporation and the Federal Reserve Board. About Porter Bancorp Porter Bancorp, Inc., is a bank holding company headquartered in Louisville, Kentucky. Through its wholly-owned subsidiary PBI Bank, the Company operates 18 full-service banking offices in twelve counties in Kentucky. Crowe Horwath, LLP, in Louisville, Kentucky, audited Porter Bancorp's financial statements for 2011. The independent auditors said that the Company has incurred substantial losses in 2011, largely as a result of asset impairments. "In addition, the Company's bank subsidiary is not in compliance with a regulatory enforcement order issued by its primary federal regulator requiring, among other things, increased minimum regulatory capital ratios. Additional significant asset impairments or continued failure to comply with the regulatory enforcement order may result in additional adverse regulatory action." The Company reported a net loss of $107.31 million in 2011, compared with a net loss of $4.38 million in 2010. The Company's balance sheet at March 31, 2012, showed $1.38 billion in total assets, $1.30 billion in total liabilities, and $82.79 million in total stockholders' equity. PREFERRED FINANCIAL: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Preferred Financial Holdings Co., LLC 4651 E 71st St Cleveland, OH 44105 Bankruptcy Case No.: 12-15508 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Northern District of Ohio (Cleveland) Judge: Jessica E. Price Smith Debtor's Counsel: Frederic P. Schwieg, Esq. 2705 Gibson Dr Rocky River, OH 44116-3008 Tel: (440) 499-4506 Fax: (440) 398-0490 E-mail: fschwieg@schwieglaw.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/ohnb12-15508.pdf The petition was signed by Timothy E. Myslenski, founding member. Affiliates that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- Preferred Drilling Co., LLC 12-15510 Preferred Financial Investment Co., LLC 12-15511 Preferred Financial Leasing Co. LLC 12-15512 Preferred Well Management Co., LLC 12-15514 PREMIER PAVING: Court Grants Short Exclusivity Extension -------------------------------------------------------- The U.S. Bankruptcy Court granted Premier Paving Inc. an extension of its exclusive right to file a chapter 11 plan through Oct. 1, 2012, and its exclusive right to solicit acceptances on that plan through Dec. 3, following a stipulation among the Debtor and key constituents in the case. The Official Committee of Unsecured Creditors and Wells Fargo Bank, N.A., previously filed objections to the Debtor's extension request. After conferring, the parties agreed to allow the Debtor a shorter exclusivity extension. The Debtor had sought a 10-month extension of the exclusive plan proposal period that was to expire July 31. As reported in the July 13 edition of the Troubled Company Reporter, the Debtor said it has been in negotiation with Wells Fargo, its primary secured creditor, regarding the use of cash collateral. It has also been talking to potential buyers and brokers to evaluate the sale of its asphalt plant. It has also been exploring financing options. In addition to the demands of the bankruptcy case, as a construction company, the spring through early fall is the Debtor's busy season. About the Debtor Denver, Colorado-based Premier Paving Inc. -- http://www.premierpavinginc.com/-- operates a full-service highway construction company, which services include paving, grading and milling, geo-textiles, trucking, traffic control and quality control. Premier Paving also owns and operates an asphalt plant. Premier Paving filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 12-16445) on April 2, 2012. Judge Michael E. Romero presides over the case. Lee M. Kutner, Esq., at Kutner Miller Brinen, P.C., serves as the Debtor's counsel. In its petition, the Debtor estimated up to $50 million in assets and debts. The petition was signed by David Goold, treasurer. The Official Unsecured Creditors Committee his represented by Onsager, Staelin & Guyerson, LLC. QPL INC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------ Debtor: QPL, Inc. P.O. Box 9839 New Iberia, LA 70562 Bankruptcy Case No.: 12-50937 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Western District of Louisiana (Lafayette) Judge: Robert Summerhays Debtor's Counsel: William C. Vidrine, Esq. VIDRINE & VIDRINE 711 West Pinhook Road Lafayette, LA 70503 Tel: (337) 233-5195 E-mail: williamv@vidrinelaw.com Scheduled Assets: $2,407,951 Scheduled Liabilities: $3,709,199 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/lawb12-50937.pdf The petition was signed by Fred Cortes, CEO. QUALTEQ INC: Case Trustee May Expand Scope of Crowe Horwath's Work ------------------------------------------------------------------ Fred C. Caruso, the Chapter 11 Trustee of QualTeq, Inc., d/b/a VCT New Jersey, Inc., sought and obtained permission from the U.S. Bankruptcy Court to expand the scope of employment of Crowe Horwath LLP effective June 22, 2012, to assist the Trustee with ordinary course financial reporting and the preparation of monthly operating reports. The Trustee will: (a) compensate Crowe for services rendered on an hourly basis at a rate of $100 per hour; and (b) reimburse actual and necessary costs and expenses incurred by Crowe in connection with the services performed on behalf of the Trustee. To the best of the Trustee's knowledge, Crowe continues to be a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About QualTeq Inc. South Plainfield, New Jersey-based QualTeq, Inc., engages in the design, manufacture, and personalization of plastic cards in the United States. The company manufactures magnetic, contact, and dual interface smart cards. Qualteq Inc. and 17 affiliated companies filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12572) on Aug. 14, 2011. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, serve as local counsel to the Debtors. K&L Gates LLP is the general bankruptcy counsel. Eisneramper LLP is the accountants and financial advisors. Scouler & Company is the restructuring advisors. Lowenstein Sandler PC is counsel to the Committee. Avadamma LLC disclosed $38,491,767 in assets and $36,190,943 in liabilities as of the Petition Date. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed four unsecured creditors to serve on the Official Committee of Unsecured Creditors. As reported in the Troubled Company Reporter on Feb. 23, 2012, Delaware Bankruptcy Judge Kevin J. Carey granted the request of Bank of America, N.A., to transfer the venue of the Chapter 11 cases to the U.S. Bankruptcy Court for the Northern District of Illinois. Bankruptcy Judge Eugene Wedoff in Chicago was assigned to the case. QUALTEQ INC: Case Trustee Taps Hilco as Real Estate Advisors ------------------------------------------------------------ Fred C. Caruso, the Chapter 11 Trustee of QualTeq, Inc., d/b/a VCT New Jersey, Inc., asks the U.S. Bankruptcy Court for permission to retain Hilco Real Estate, LLC, as real estate advisors. Hilco will advise and assist the Trustee in connection with these tasks: (a) meeting with the Trustee to ascertain the Trustee's goals, objectives, and financial parameters; (b) soliciting interested parties for the sale of certain real properties, and marketing the Properties for sale; (c) at the Trustee's direction and on the Trustee's behalf, negotiating the terms of the sale of the Properties; and (d) identifying fair market rent associated with the Properties or other locations leased by the Debtors to their affiliates. Hilco will be paid according to this fee structure: Monthly Retainer * On October 15, 2012, the Trustee shall pay Hilco a fee of $50,000. * On November 15, 2012, the Trustee shall pay Hilco a fee of $100,000. * On December 15, 2012, the Trustee shall pay Hilco a fee of $50,000 Transaction Fees * Subject to Section 4(c)(ii) of the Engagement Letter, for each Property that is sold, Hilco will earn and be entitled to payment by the Trustee of a fee equal to 3.25% of the Gross Sale Proceeds from the sale of each such Property. * For each Property identified as a "Co-Marketed Property" that is sold, transferred, or otherwise disposed of during the Term in connection with a going concern transaction for which PwC CF is otherwise entitled to a Transaction Fee (as that term is defined by the PwC CF Engagement Letter), the Real Estate Transaction Fee shall be 4.00%; provided that one-half of the Real Estate Transaction Fee shall be payable by the Trustee to PwC CF and not Hilco. For the avoidance of doubt, Section 4(c)(ii) of the Engagement Letter applies only where the acquirer of the applicable Co-Marketed Property is also the acquirer (or an affiliate of such acquirer) of the assets acquired and/or liabilities assumed in a going- concern transaction for which PwC CF is entitled to a Transaction Fee pursuant to the PwC CF Engagement Letter. * To the extent the "value" of a Co- Marketed Property sold, transferred, or otherwise disposed of in connection with any other transaction is enhanced as a result of a bid or bids received from a third party procured by PwC CF, 50 basis points of the Real Estate Transaction Fee shall be payable by the Trustee to PwC CF and not Hilco. PwC CF, Hilco, and the Trustee shall mutually agree upon the "value" enhancement or, if such parties are unable to reach an agreement, resolved by the Bankruptcy Court after notice and a hearing. For the avoidance of doubt, Section 4(c)(iii) of the Engagement Letter shall not apply if a Real Estate Transaction Fee is payable to PwC CF pursuant to Section 4(c)(ii) of the Engagement Letter. * Hilco shall not be entitled to a fee for any Property sold, transferred, or otherwise disposed of as part of a "credit bid" by one or more of the Debtors' lenders, unless the Trustee is permitted to recover such fees pursuant to section 506(c) of the Bankruptcy Code. Crediting * For each $1 of Transaction Fees earned, $0.50 shall be credited against the Monthly Fees earned. Court Appearances * Hilco shall be paid $400 for each appearance in the Bankruptcy Court. In addition, the Trustee will reimburse Hilco for its travel and the reasonable, documented out-of-pocket expenses it incurs in connection with its services under the Engagement Letter. Ian S. Fredericks, Esq., Vice President and Assistant General Counsel of Hilco Trading, LLC, the parent company of Hilco Real Estate, LLC, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About QualTeq Inc. South Plainfield, New Jersey-based QualTeq, Inc., engages in the design, manufacture, and personalization of plastic cards in the United States. The company manufactures magnetic, contact, and dual interface smart cards. Qualteq Inc. and 17 affiliated companies filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12572) on Aug. 14, 2011. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, serve as local counsel to the Debtors. K&L Gates LLP is the general bankruptcy counsel. Eisneramper LLP is the accountants and financial advisors. Scouler & Company is the restructuring advisors. Lowenstein Sandler PC is counsel to the Committee. Avadamma LLC disclosed $38,491,767 in assets and $36,190,943 in liabilities as of the Petition Date. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed four unsecured creditors to serve on the Official Committee of Unsecured Creditors. As reported in the Troubled Company Reporter on Feb. 23, 2012, Delaware Bankruptcy Judge Kevin J. Carey granted the request of Bank of America, N.A., to transfer the venue of the Chapter 11 cases to the U.S. Bankruptcy Court for the Northern District of Illinois. QUANTUM FUEL: Sells $1.9 Million Bridge Notes to Investors ---------------------------------------------------------- Quantum Fuel Systems Technologies Worldwide, Inc., entered into separate Subscription Agreements with certain "accredited investors", as that term is defined in Rule 501(a) of Regulation D under the United States Securities Act of 1933, as amended, for the sale and purchase of $1,975,000 of unsecured subordinated nonconvertible promissory notes and warrants to purchase shares of the Company's common stock. The Company received gross proceeds of $1,975,000, of which $475,000 was paid in cash and $1,500,000 was paid by the cancellation of unsecured convertible notes owed by the Company to certain of the Investors that participated in the Private Placement that were scheduled to mature in October 2012. The net cash proceeds from the Private Placement will be used for general working capital purposes. The Bridge Notes are unsecured obligations of the Company and are subordinate in all respects to the Company's senior secured indebtedness. Interest accrues at a rate of 12% per year and is payable quarterly in arrears on October 1, January 1, April 1 and July 1. The Company paid its placement agent a cash fee equal to $147,750 for services rendered in connection with the Private Placement. As a result of the cancellation of the Cancelled Convertible Notes, a total of $3,750,000 of debt principal that would have been due in October 2012 and November of 2012 was cancelled, leaving a remining principal amount due on the noncancelled convertible notes of $200,000. Concurrent with the private placement of $1,975,000 of bridge notes and warrants, the Company also entered into separate Subscription Agreements with certain "accredited investors" for the sale and purchase of $500,000 of unsecured subordinated nonconvertible promissoy notes and warrants to purchase up to 348,879 shares of the Company's common stock. The net cash proceeds from the Private Placement will be used for general working capital purposes. A copy of the Form 8-K is available for free at: http://is.gd/A0znne About Quantum Fuel Based in Irvine, California, Quantum Fuel Systems Technologies Worldwide, Inc., is a fully integrated alternative energy company and considers itself a leader in the development and production of advanced clean propulsion systems and renewable energy generation systems and services. Quantum Fuel reported a net loss attributable to stockholders of $38.49 million on $24.47 million of total revenue for the eight months ended Dec. 31, 2011, compared with a net loss attributable to stockholders of $6.52 million on $10.51 million of total revenue for the same period a year ago. The Company reported a net loss of $11.03 million for the year ended April 30, 2011, following a net loss of $46.29 million during the prior year. The Company's balance sheet at March 31, 2012, showed $51.54 million in total assets, $17.48 million in total liabilities, and $34.06 million in total stockholders' equity. Haskell & White LLP, the Company's independent registered public accounting firm for the Transition Period ended Dec. 31, 2011, has included an explanatory paragraph in their opinion that accompanies the Company's audited consolidated financial statements as of and for the eight months ended Dec. 31, 2011, indicating that the Company's current liquidity position raises substantial doubt about its ability to continue as a going concern. If the Company is unable to further improve its liquidity position, the Company may not be able to continue as a going concern. QUICKSILVER RESOURCES: Moody's Cuts Corp. Family Rating to 'B2' --------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating (CFR) at Quicksilver Resources, Inc. to B2 from B1, senior unsecured notes ratings to B3 from B2 and subordinated notes rating to Caa1 from B3. Ratings were placed on review for downgrade. A total of $1.7 billion rated debt is affected. Ratings Rationale "The downgrade of Quicksilver's Corporate Family Rating (CFR) to B2 from B1 is reflective of weaker earnings and profitability driven by high exposure to low natural gas and NGL prices," stated Michael Somogyi , Moody's Vice President -- Senior Analyst. "In addition, Quicksilver's delayed MLP funding and associated debt reduction plans extend its high leverage profile and elevate liquidity concerns as lower production volumes and resulting decline in EBITDA are expected lead to tighter covenant headroom and potential negative borrowing base redetermination." Quicksilver has a concentrated asset base with 88% of 2011 proved reserves located in the Barnett Shale across 140,000 net acres. Through the first quarter of 2012, production from the Barnett accounted for over 80% of average daily production volumes, of which 76% was natural gas with nearly all the remaining production being NGLs. While the company is looking to diversify its asset portfolio across emerging projects in the Canadian Horn River Basin, Sandwash Basin of Northwest Colorado and West Texas, Quicksilver remains highly exposed to weak natural gas prices. This natural gas weighted production profile is compounded by the roll-down of natural gas hedges and roll-off of all NGL hedges in 2013, further exposing the company to cash flow volatility over the next 12 -- 18 months. Quicksilver's adjusted debt level of roughly $2 billion remains elevated stemming from prior acquisition activity and delayed MLP funding and debt reduction plans. The company's persistent high debt level relative to declining production volumes is expected to further weaken Quicksilver's operating profile and credit protection metrics with debt / average daily production expected to rise to over $32,000 per boe and retained cash flows / debt expected to fall to below 10% by year-2013, based on Moody's base case price assumptions. The company's debt reduction plans have been limited due to declining cash flows and the ongoing delay in launching its previously announced master limited partnership (MLP) subsidiary ('Quicksilver Production Partners'). The proposed MLP will own a portion of its core Barnett Shale properties and expected IPO proceeds are earmarked for debt reduction. Still, the ongoing delay in launching this MLP is reflective of weaker commodity prices in the target asset base. Given the inherent uncertainty in the capital market execution of this plan, the company is looking to accelerate JV opportunities and potential asset sales across its asset base over the 2H2012 with proceeds to be used to reduce debt. The SGL-3 Speculative Grade Liquidity rating reflects adequate liquidity. Quicksilver re-affirmed its $1.75 billion Combined Credit Agreement with a borrowing base of $1.075 billion, including a letter of credit capacity of $175 million, in May- 2012. At March 31, 2012, the company had $679 million available under the facility. The bank facility is subjectj to two financial covenants defined as (1) minimum 1.0x current ratio and (2) minimum 2.5x EBITDA / cash interest expense coverage ratio. Moody's expects tighter covenant headroom over the near-term reflective of declining production volumes and EBITDA projections based on Moody's commodity price assumptions. In addition, the potential for negative borrowing base redetermination may further limit Quicksilver's financial flexibility. The company has $438 million senior notes due 2015, $590 million senior notes due 2016, and $298 million senior notes due 2019 that are unsecured. The company also has $350 million of senior subordinated notes due 2016. Under Moody's Loss Given Default (LGD) Methodology, the senior notes are rated B3 and the senior subordinated notes are rated Caa1. This notching beneath the B2 CFR reflects the relative size of the senior secured facility's potential priority claim and the debt instruments relative seniority in the capital structure. Quicksilver's B2 CFR was placed on review for downgrade due to Moody's expectations of tighter covenant headroom under its Combined Credit Agreement and potential for a negative borrowing base redetermination. As part of its review, Moody's will evaluate management plans to maintain adequate liquidity and expectations for debt reduction. The principal methodology used in rating Quicksilver was the Global Independent Exploration and Production Industry Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Quicksilver is a publicly-traded, independent exploration and production (E&P) company with primary operations in the Barnett Shale in Texas. The company was founded in 1997 and is headquartered in Fort Worth, Texas. R.E. LOANS: Plan of Reorganization Declared Effective ----------------------------------------------------- R.E. Loans, LLC, et al., notified the U.S. Bankruptcy Court for the Northern District of Texas that the Effective Date of the Modified Fourth Amended Plan of Reorganization dated June 1, 2012, occurred on June 29, 2012. The TCR reported on June 12 the confirmation of the Debtors' Modified Fourth Amended Plan, as supplemented on June 8, 2012. The Modified Fourth Amended Joint Plan contemplates the reorganization of the Debtors' businesses and the resolution of outstanding Claims against and Interests in the Debtors through the formation of a Liquidating Trust intended to hold and own the equity in the Reorganized R.E. Loans, to pursue litigation recoveries of claims owned by the Debtors and the Reorganized Debtors, and distribute the proceeds to the holders of Allowed Claims pursuant to the Plan and the Trust Agreement. Generally, the Plan provides that: (1) all Notes Receivable and REO Property will re-vest in the Reorganized Debtors; and (2) all Causes of Action that are not settled or released by the Plan and the equity of the Reorganized R.E. Loans will vest in the Liquidating Trust. All Causes of Action, including all Avoidance Actions, will be transferred to the Liquidating Trust, except Causes of Action against Wells Fargo and Causes of Action against Holders of Allowed Claims in REL Class 8 if REL Class 8 votes to accept the Plan and implement the Plan Compromise. In addition, New Equity Interests in Reorganized R.E. Loans will be issued to the Liquidating Trust and held by the Liquidating Trustee for the benefit of holders of Allowed Claims. Accordingly, the Liquidating Trustee will be the sole member of Reorganized R.E. Loans. The Plan will be financed through the secured Wells Fargo Exit Facility, which will be provided by Wells Fargo in an amount sufficient to (i) repay in full Wells Fargo's Prepetition Claims and Wells Fargo's DIP Facility Claim; (ii) satisfy all Allowed Administrative Expenses, Priority Tax Claims and Priority Non-Tax Claims; and (iii) provide the Reorganized Debtors with sufficient liquidity to administer and dispose of their Assets, exclusive of the retained Causes of Action. Net Cash proceeds from the sale or disposition of Notes Receivable and REO Property will be used first to fund the operations of the Reorganized Debtors and repay the Wells Fargo Exit Facility, pursuant to the terms of the Wells Fargo Exit Facility. A full-text copy of the Modified Fourth Amended Joint Plan is available for free at: http://bankrupt.com/misc/RE_LOANS_plan_modifie4amended.pdf About R.E. Loans R.E. Loans, LLC, was, for many years, in the business of providing financing to home builders and developers of real property. R.E. Future LLC and Capital Salvage own the real property obtained following foreclosure proceedings initiated by R.E. Loans against its borrowers. R.E. Loans is the sole shareholder of Capital Salvage and the sole member of R.E. Future. B-4 Partners LLC is the sole member of R.E. Loans. As a result of the multiple defaults by R.E. Loans' borrowers, R.E. Loans has transitioned from being a lender to becoming a property management company. Lafayette, California-based R.E. Loans, R.E. Future and Capital Salvage filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case Nos. 11-35865, 11-35868 and 11-35869) on Sept. 13, 2011. Judge Barbara J. Houser presides over the case. Stutman, Treister & Glatt Professional Corporation, in Los Angeles, and Gardere, Wynne Sewell LLP, in Dallas, represent the Debtors as counsel. James A. Weissenborn at Mackinac serves as R.E. Loans' chief restructuring officer. The Debtors tapped Hines Smith Carder as their litigation and outside general counsel. The Debtors tapped Alixpartners, LLP as noticing agent, and Latham & Watkins LLP as special counsel in real estate matters. R.E. Loans disclosed $713.6 million in assets and $886.0 million in liabilities as of the Chapter 11 filing. Akin Gump Strauss Hauer & Feld LLP, in Dallas, represents the Official Committee of Note Holders as counsel. RANCHER ENERGY: Posts $882,900 Net Loss in Fiscal 2012 ------------------------------------------------------ Rancher Energy Corp. reported a net loss of $882,928 for the fiscal year ended March 31, 2012, compared with a net loss of $674,059 for the fiscal year ended March 31, 2011. The Company had no revenues from continuing operations in 2012 or 2011. The Company's balance sheet at March 31, 2012, showed 4.96 million in total assets, $2.32 million in total liabilities, and stockholders' equity of $2.64 million. A copy of the Form 10-K is available for free at: http://is.gd/I4RoUh Rancher Energy Corp. was incorporated on Feb. 4, 2004, as Metalex Resources, Inc., in the State of Nevada. Prior to April 2006, the Company was engaged in the exploration of a gold prospect in British Columbia, Canada. Metalex found no commercially exploitable deposits or reserves of gold. During April 2006, the Company's stockholders voted to change the Company's name to Rancher Energy Corp. Rancher Energy filed for Chapter 11 bankruptcy protection (Bankr. D. Colo. Case No. 09-32943) on Oct. 28, 2009. In its petition, the Company estimated assets and debts of between $10 million and $50 million each. The Debtor is represented by Michael J. Guyerson, Esq. and Christian C. Onsager, Esq., at Onsager, Staelin & Guyerson, LLC. The Company sold substantially all of its assets effective March 1, 2011, to Linc Energy Petroleum (Wyoming), Inc., in exchange for $20 million cash plus other potential future consideration up to $825,000, and subject to other adjustments. The deal was approved Feb. 24, 2011. Funds from the sale of assets were primarily used to pay outstanding principal and accrued interest on a Debtor-In- Possession Loan totaling $14,829,950. Of the $825,000 potential future considerations dating to the March 1, 2011 sale of assets, a Settlement and Release Agreement among Rancher, GasRock and Linc Energy was agreed to on June 15, 2012. The Bankruptcy Court subsequently approved the Agreement in July and on July 18, 2012, the $525,000 was received by Rancher. It does not appear that the other $300,000 will be realized by the Company. On April 30, 2012, the Company filed its 2nd Amended Plan of Reorganization and Disclosure Statement for 2nd Amended Plan of Reorganization with the Court. The Plan provides for the Company to pay the claims of its creditors as the assets of the Company allow, and permits, but does not obligate, the Company to continue in the oil and gas industry with a focus on the purchase on non- operating interests in oil and gas producing properties. As of the filing of the Company's Form 10-K for the fiscal year ended March 31, 2012, the 2nd Amended Plan has not been sent for voting and has not been confirmed by the Bankruptcy Court. REAL ESTATE: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Real Estate Development LC LLC 17000 W. Sunset Blvd. Pacific Palisades, CA 90272 Bankruptcy Case No.: 12-35840 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Central District of California (Los Angeles) Debtor's Counsel: Rachel S. Ruttenberg, Esq. LAW OFFICES OF MARK E GOODFRIEND 16255 Ventura Blvd., Suite 205 Encino, CA 91436 Tel: (818) 783-8866 Fax: (818) 783-5445 E-mail: rruttenberg@gmail.com Estimated Assets: $500,001 to $1,000,000 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 Revital Weingarten, managing member. REGAL ENTERTAINMENT: Reports $37.2 Million Net Income in Q2 ----------------------------------------------------------- Regal Entertainment Group reported net income of $37.2 million on $723.3 million of total revenues for the quarter ended June 28, 2012, compared with net income of $34.8 million on $753.3 million of total revenues for the quarter ended June 30, 2011. The Company reported net income of $83.5 million on $1.40 billion of total revenues for the two quarters ended June 28, 2012, compared with net income of $11.1 million on $1.32 billion of total revenues for the two quarters ended June 30, 2011. "First and foremost, our thoughts are with those affected by the events that transpired in Colorado last Thursday night," stated Amy Miles, CEO of Regal Entertainment Group. "We believe that movie theatres have always been and will continue to be places where friends, families and communities can safely gather together for a few hours of fun and entertainment. We were devastated and heartbroken by the senseless acts that took place in one of those theatres last week, but remain committed to providing a safe and secure environment for our guests." Regal's Board of Directors also declared a cash dividend of $0.21 per Class A and Class B common share, payable on Sept. 18, 2012, to stockholders of record on Sept. 10, 2012. The Company intends to pay a regular quarterly dividend for the foreseeable future at the discretion of the Board of Directors depending on available cash, anticipated cash needs, overall financial condition, loan agreement restrictions, future prospects for earnings and cash flows as well as other relevant factors. A copy of the press release is available for free at: http://is.gd/Dm99KL About Regal Entertainment Group Based in Knoxville, Tennessee, Regal Entertainment Group (NYSE: RGC) -- http://www.REGmovies.com/-- is the largest motion picture exhibitor in the world. Regal's theatre circuit, comprising Regal Cinemas, United Artists Theatres and Edwards Theatres, operates 6,739 screens in 545 locations in 38 states and the District of Columbia. Regal operates theatres in 43 of the top 50 U.S. designated market areas. The Company's balance sheet at March 29, 2012, showed $2.30 billion in total assets, $2.85 billion in total liabilities, and a $552.60 million total deficit. * * * Regal Entertainment carries 'B1' corporate family and probability of default ratings from Moody's Investors Service, 'B+' issuer default rating from Fitch Ratings, and 'B+' corporate credit rating from Standard & Poor's Ratings Services. Moody's said in February 2011 that Regal's B1 CFR reflects the trade-offs between the relative stability and the small magnitude of the company's cash flow stream. With no change expected in either parameter, and with very good liquidity, the rating outlook is stable. S&P said in February that the rating reflects S&P's view that the company's aggressive financial policies will likely cause leverage to remain elevated over the intermediate term. Furthermore, Regal's revenue and EBITDA trends are highly dependent on the performance of the U.S. box office. Other rating factors include the company's participation in the mature and highly competitive U.S. movie exhibition industry, exposure to the fluctuating popularity of Hollywood films, and the long-term risk of increased competition from the proliferation of entertainment alternatives. RHODE ISLAND STUDENT: Moody's Lifts Ratings on 12 Bond Classes -------------------------------------------------------------- Moody's Investors Service has upgraded twelve classes of bond issued by Rhode Island Student Loan Authority under a master indenture established as of January 1, 2004. The underlying collateral consists of a pool of private student loans that are not guaranteed or reinsured under the Federal Family Education Loan Program (FFELP) or any other federal student loan program. Ratings Rationale The primary driver for the upgrade is the continued build-up in credit enhancement, shown as the total parity ratio, i.e. the ratio of total assets to total liabilities. The total parity has increased from 106.6% in 2008 to 120.2% as of the most recent reporting date. In addition, an amendment of the transaction documents increased the target parity level from 103% to 117%. After the amendment, even if the bond insurer agreed with the release of excess cash, the parity after release has to be at least 117%, further reducing negative credit impact due to excess cash release. Available credit enhancement to the transactions includes overcollateralization, reserve funds, and excess spread. Significant structural features include a reserve fund floor, which results in a build-up in credit enhancement as a percentage of the amortizing pool balance. Moody's expected remaining net loss as a percentage of the remaining pool balance is approximately 7.4%. The ratings of the 2004 A-2 tranche could be upgraded in the future if the expected remaining net loss is 10% lower, or downgraded if the expected remaining net loss is 10% higher. Further upgrade is possible in the future depending on the information Moody's receives regarding the cumulative default information by repayment year and loan type. The principal methodology used in these rating actions was "Moody's Approach to Rating U.S. Private Student Loan-Backed Securities", published on January 6th, 2010 and available at www.moodys.com in the Rating Methodologies sub-directory under the Research & Ratings tab. Other methodologies and factors that may have been considered in the process of rating this issue can also be found in the Rating Methodologies sub-directory on Moody's website. 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. 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 exclusively, the performance metrics. Primary sources of uncertainty with regard to expected loss are the weak economic environment and the high unemployment rate, which adversely impacts the income- generating ability of the borrowers. Ratings Issuer: Rhode Island Student Loan Authority (2004 Indenture) 2004-A2, Upgraded to Baa1 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2004-A3-8, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2004-A3-9, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2004-A3-10, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2004-A3-11, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2004-A3-12, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2004-A3-13, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2006 Ser. 1, Upgraded to Baa1 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2006 Ser. 2, Upgraded to Baa1 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2006 Ser. 3-1, Upgraded to A2 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2006 Ser. 3-2, Upgraded to Baa1 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade 2006 Ser. 3-3, Upgraded to Baa1 (sf); previously on Mar 12, 2012 B2 (sf) Placed Under Review for Possible Upgrade ROCHA DAIRY: Court Continues Hearing on Dismissal Bid to September ------------------------------------------------------------------ The U.S. Bankruptcy Court moved back the hearing on motion filed by MLIC Asset Holdings LLC seeking dismissal of -- or relief from the automatic stay in -- the Chapter 11 case of Rocha Dairy, LLC. The hearing was initially set for July 25. Pursuant to a stipulation by the parties, the hearing is continued to the earlier of the date and time to be set for the first confirmation hearing on the Debtor's Amended Plan or Sept. 26, 2012 at 9:00 a.m. This is the second stipulation reached by the parties with respect to a continuance of the hearing. The Debtor will continue to make monthly adequate protection payments of $7,500 to MLIC through the month prior to the first month in which any payment pursuant to a confirmed plan of reorganization is to be made to MLIC. About Rocha Dairy Based in Wendell, Idaho, Rocha Dairy LLC, aka Rocha Farms, filed for Chapter 11 bankruptcy (Bankr. D. Idaho Case No. Case No. 11-40836) on May 25, 2011. Judge Jim D. Pappas presides over the case. Lawyers at Robinson, Anthon & Tribe serve as bankruptcy counsel to the Debtor. In its petition, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in debts. The petition was signed by Elcidio Rocha, member. RG STEEL: Willkie Farr Bills $1.35-Mil. for A Month's Work ---------------------------------------------------------- Mark Reutter at Baltimore Brew reports the law firm Willkie Farr & Gallagher LLP in Manhattan submitted a bill of $1,350,137 for its first month as co-counsel (May 31-June 30), with another $31,795.83 in expenses, to RG Steel. Altogether, Willkie Farr said it used 44 firm members -- 8 partners, 20 associates, 9 legal assistants and 7 summer interns -- to work on the case, racking up 2,199.5 billable hours. Leading the list of rainmakers are: -- Shaunna D. Jones, a New York University Law School grad who recently became a partner in the firm. She billed $163,530 for 207 hours at $790 an hour; -- Andrew Sorkin ($163,215 for 251 hours and 6 minutes); -- senior partner Matthew A. Feldman ($142,790 for 131 hours), and; -- Daniel I. Forman ($141,277.50 for 245 hours and 42 minutes). The report notes the lawyers helped draft a bonus plan for RG Steel's 10 top managers to share up to $20 million in bonuses if the bankrupt steel company is successfully sold. The report says, other Willkie Farr lawyers feasting on RG Steel's woes: Weston T. Eguchi ($100,667), David I. Gise ($96,876), Andrew S. Mordkoff ($83,960), Joshua M. Troy ($74,360) and Brian E. O'Connor ($51,121). The report adds the New York lawyers were aided by the local co-counsel, Morris, Nichols, Arsht & Tunnell LLP of Wilmington, which has not submitted its first month's bill yet. About RG Steel RG Steel LLC -- http://www.rg-steel.com/-- is the United States' fourth-largest flat-rolled steel producer with annual steelmaking capacity of 7.5 million tons. It was formed in March 2011 following the purchase of three steel facilities located in Sparrows Point, Maryland; Wheeling, West Virginia and Warren, Ohio, from entities related to Severstal US Holdings LLC. RG Steel also owns finishing facilities in Yorkville and Martins Ferry, Ohio. It also owns Wheeling Corrugating Company and has a 50% ownership in Mountain State Carbon and Ohio Coatings Company. RG Steel along with affiliates, including WP Steel Venture LLC, sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12- 11661) on May 31, 2012, to pursue a sale of the business. The bankruptcy was precipitated by liquidity shortfall and a dispute with Mountain State Carbon, LLC, and a Severstal affiliate, that restricted the shipment of coke used in the steel production process. The Debtors estimated assets and debts in excess of $1 billion as of the Chapter 11 filing. The Debtors owe (i) $440 million, including $16.9 million in outstanding letters of credit, to senior lenders led by Wells Fargo Capital Finance, LLC, as administrative agent, (ii) $218.7 million to junior lenders, led by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million on account of a subordinated promissory note issued by majority owner The Renco Group, Inc., and (iv) $100 million on a secured promissory note issued by Severstal. Judge Kevin J. Carey presides over the case. The Debtors are represented in the case by Robert J. Dehney, Esq., and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP, and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T. Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial advisor and The Seaport Group serves as lead investment banker. Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson Consultants LLC is the claims and notice agent. Wells Fargo Capital Finance LLC, as Administrative Agent, is represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang Ziehi & Jones LLP. Renco Group is represented by lawyers at Cadwalader, Wickersham & Taft LLP. An official committee of unsecured creditors has been appointed in the case. Kramer Levin Naftalis & Frankel LLP represents the Committee. Huron Consulting Services LLC serves as its financial advisor. RITZ CAMERA: Taps David Angress to Provide Consulting Services -------------------------------------------------------------- Ritz Camera & Image L.L.C., et al., ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ David Angress to provide consulting services. Mr. Angress will provide, among other things: -- merchandizing, imaging, services, private label, marketing, vendor, online/offline strategies; -- optimal store layout; and -- optimal geographic layout, including how the Debtors can best manage their newly configured and reduced number of "go-forward stores." Pursuant to the consulting agreement, the compensation of Mr. Angress for the services will include a monthly fee of $30,500. To the best of the Debtors' knowledge, Mr. Angress holds to no interest adverse to the Debtor's estate. About Ritz Camera Beltsville, Maryland-based Ritz Camera & Image LLC -- http://www.ritzcamera.com-- sells digital cameras and accessories, and electronic products. It sought Chapter 11 protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to close unprofitable stores. Ritz claims to be the largest camera and image chain the U.S., operating 265 camera stores in 34 states as well as an Internet business. Ritz Camera intends to shut 128 locations and cut its staff in half. Included in the closing are 10 locations in Maryland and 4 in Virginia. Affiliate Ritz Interactive Inc., owner e-commerce Web sites that include RitzCamera.com and BoatersWorld.com, also filed for bankruptcy. RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11 protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009. Ritz generated $40 million by selling all 129 Boater's World Marine Centers. A group that included the company's chief executive officer, David Ritz, formed Ritz Camera & Image to buy at least 163 of the remaining 375 camera stores. The group paid $16.25 million in cash and a $7.8 million note. Later, Ritz sold a $4 million account receivable for $1.5 million to an owner of the company that owed the debt. In the 2009 petition, Ritz disclosed total assets of $277 million and total debts of $172.1 million. Lawyers at Cole, Schotz, Meisel, Forman & Leonard, P.A., served as bankruptcy counsel. Thomas & Libowitz, P.A., served as the Debtor's special corporate counsel and conflicts counsel. Marc S. Seinsweig, at FTI Consulting, Inc., served as the Debtor's chief restructuring officer. Kurtzman Carson Consultants LLC acted as claims and noticing agent. Attorneys at Cooley Godward Kronish LLP and Bifferato LLC represented the official committee of unsecured creditors as counsel. In April 2010, the Court approved a liquidating Chapter 11 plan proposed by the company and the official creditor's committee. Under the Plan, unsecured creditors were to recover 4% to 14% of their claims. In the 2012 petition, RCI estimated total assets and liabilities of $50 million to $100 million. The Debtors owe not less than $16.32 million for term and revolving loans provided by secured lenders led by Crystal Finance LLC, as administrative agent. Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve as bankruptcy counsel. Kurtzman Carson Consultants LLC is the claims agent. WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as Ritz's CRO. Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC. Crystal Finance, the DIP lender, is represented by Morgan, Lewis & Bockius and Young Conaway Stargatt & Taylor LLP. Roberta A. Deangelis, U.S. Trustee for Region 3, appointed seven creditors to serve on the Official Committee of Unsecured Creditors in the Debtors' cases. RITZ CAMERA: Taps Kurtzman Carson to Provide Admin. Services ------------------------------------------------------------ Ritz Camera & Image L.L.C., et al., ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Kurtzman Carson Consultants LLC to provide administrative services to the Debtors. KCC will, among other things: -- assist the Debtors in analyzing claims filed against their estates; -- assist the Debtor with the preparation of the Debtors' schedules of assets and liabilities and statements of financial affairs; and -- tabulate votes and perform subscription services as may be requested or required in connection with any and all chapter 11 plans that may be filed by the Debtors and provide ballot reports and related balloting and tabulation services to the Debtors and their professionals. Prior to the Petition Date, the Debtors paid KCC a retainer of $15,000. To the best of the Debtors' knowledge, KCC is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Ritz Camera Beltsville, Maryland-based Ritz Camera & Image LLC -- http://www.ritzcamera.com-- sells digital cameras and accessories, and electronic products. It sought Chapter 11 protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to close unprofitable stores. Ritz claims to be the largest camera and image chain the U.S., operating 265 camera stores in 34 states as well as an Internet business. Ritz Camera intends to shut 128 locations and cut its staff in half. Included in the closing are 10 locations in Maryland and 4 in Virginia. Affiliate Ritz Interactive Inc., owner e-commerce Web sites that include RitzCamera.com and BoatersWorld.com, also filed for bankruptcy. RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11 protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009. Ritz generated $40 million by selling all 129 Boater's World Marine Centers. A group that included the company's chief executive officer, David Ritz, formed Ritz Camera & Image to buy at least 163 of the remaining 375 camera stores. The group paid $16.25 million in cash and a $7.8 million note. Later, Ritz sold a $4 million account receivable for $1.5 million to an owner of the company that owed the debt. In the 2009 petition, Ritz disclosed total assets of $277 million and total debts of $172.1 million. Lawyers at Cole, Schotz, Meisel, Forman & Leonard, P.A., served as bankruptcy counsel. Thomas & Libowitz, P.A., served as the Debtor's special corporate counsel and conflicts counsel. Marc S. Seinsweig, at FTI Consulting, Inc., served as the Debtor's chief restructuring officer. Kurtzman Carson Consultants LLC acted as claims and noticing agent. Attorneys at Cooley Godward Kronish LLP and Bifferato LLC represented the official committee of unsecured creditors as counsel. In April 2010, the Court approved a liquidating Chapter 11 plan proposed by the company and the official creditor's committee. Under the Plan, unsecured creditors were to recover 4% to 14% of their claims. In the 2012 petition, RCI estimated total assets and liabilities of $50 million to $100 million. The Debtors owe not less than $16.32 million for term and revolving loans provided by secured lenders led by Crystal Finance LLC, as administrative agent. Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve as bankruptcy counsel. Kurtzman Carson Consultants LLC is the claims agent. WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as Ritz's CRO. Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC. Crystal Finance, the DIP lender, is represented by Morgan, Lewis & Bockius and Young Conaway Stargatt & Taylor LLP. Roberta A. Deangelis, U.S. Trustee for Region 3, appointed seven creditors to serve on the Official Committee of Unsecured Creditors in the Debtors' cases. RITZ CAMERA: Taps SSG Capital as Exclusive Investment Banker ------------------------------------------------------------ Ritz Camera & Image L.L.C., et al., asked the U.S. Bankruptcy Court for the District of Delaware for permission to employ SSG Capital Advisors, LLC as exclusive investment banker nunc pro tunc to June 29, 2012. SSG will, among other things: -- prepare an information memorandum describing the Company, its historical performance and prospects, including existing contracts, marketing and slae, labor force, and management and anticipated financial results of the Company; -- assist the Company in compiling a data room of any necessary and appropriate documents related to the sale; and -- assist the Company in developing a list of suitable potential buyers who will be contacted on a discreet and confidential basis after approval by the Company. SSG will be paid: a) initial fee of $50,000; b) sale fee equal to the lesser of (i) $500,000, or (ii) $150,000 plus 1.5% of the total consideration; and c) a supplemental sale fee equal to $100,000. To the best of the Debtors' knowledge, SSG is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Ritz Camera Beltsville, Maryland-based Ritz Camera & Image LLC -- http://www.ritzcamera.com-- sells digital cameras and accessories, and electronic products. It sought Chapter 11 protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to close unprofitable stores. Ritz claims to be the largest camera and image chain the U.S., operating 265 camera stores in 34 states as well as an Internet business. Ritz Camera intends to shut 128 locations and cut its staff in half. Included in the closing are 10 locations in Maryland and 4 in Virginia. Affiliate Ritz Interactive Inc., owner e-commerce Web sites that include RitzCamera.com and BoatersWorld.com, also filed for bankruptcy. RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11 protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009. Ritz generated $40 million by selling all 129 Boater's World Marine Centers. A group that included the company's chief executive officer, David Ritz, formed Ritz Camera & Image to buy at least 163 of the remaining 375 camera stores. The group paid $16.25 million in cash and a $7.8 million note. Later, Ritz sold a $4 million account receivable for $1.5 million to an owner of the company that owed the debt. In the 2009 petition, Ritz disclosed total assets of $277 million and total debts of $172.1 million. Lawyers at Cole, Schotz, Meisel, Forman & Leonard, P.A., served as bankruptcy counsel. Thomas & Libowitz, P.A., served as the Debtor's special corporate counsel and conflicts counsel. Marc S. Seinsweig, at FTI Consulting, Inc., served as the Debtor's chief restructuring officer. Kurtzman Carson Consultants LLC acted as claims and noticing agent. Attorneys at Cooley Godward Kronish LLP and Bifferato LLC represented the official committee of unsecured creditors as counsel. In April 2010, the Court approved a liquidating Chapter 11 plan proposed by the company and the official creditor's committee. Under the Plan, unsecured creditors were to recover 4% to 14% of their claims. In the 2012 petition, RCI estimated total assets and liabilities of $50 million to $100 million. The Debtors owe not less than $16.32 million for term and revolving loans provided by secured lenders led by Crystal Finance LLC, as administrative agent. Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve as bankruptcy counsel. Kurtzman Carson Consultants LLC is the claims agent. WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as Ritz's CRO. Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC. Crystal Finance, the DIP lender, is represented by Morgan, Lewis & Bockius and Young Conaway Stargatt & Taylor LLP. Roberta A. Deangelis, U.S. Trustee for Region 3, appointed seven creditors to serve on the Official Committee of Unsecured Creditors in the Debtors' cases. RITZ CAMERA: Winthrop Couchot Tapped as California Counsel ---------------------------------------------------------- Ritz Camera & Image L.L.C., et al., asked the U.S. Bankruptcy Court for the District of Delaware for permission to employ Winthrop Couchot Profesional Corporation as California special counsel to Ritz Interactive, LLC. The Debtors relate that on Aug. 19, 2011, Ritz Interactive filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the District of California. On Feb. 14, 2012, the Court confirmed RII's plan of reorganization which became effective on Feb. 21, 2012. As part of the RII Plan, RII ceased to exist to RI was formed as a Delaware limited liability company and became a wholly-owned subsidiary of Ritz Camera & Image, L.L.C., which is RI's sole member. Winthrop's proposed engagement by RI does not involve the representation of the Debtors in conducting their Chapter 11 cases before the Delaware Court. To the best of the Debtor's knowledge, Winthrop does not hold or represent any interest adverse to the Debtor or their estate. About Ritz Camera Beltsville, Maryland-based Ritz Camera & Image LLC -- http://www.ritzcamera.com-- sells digital cameras and accessories, and electronic products. It sought Chapter 11 protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to close unprofitable stores. Ritz claims to be the largest camera and image chain the U.S., operating 265 camera stores in 34 states as well as an Internet business. Ritz Camera intends to shut 128 locations and cut its staff in half. Included in the closing are 10 locations in Maryland and 4 in Virginia. Affiliate Ritz Interactive Inc., owner e-commerce Web sites that include RitzCamera.com and BoatersWorld.com, also filed for bankruptcy. RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11 protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009. Ritz generated $40 million by selling all 129 Boater's World Marine Centers. A group that included the company's chief executive officer, David Ritz, formed Ritz Camera & Image to buy at least 163 of the remaining 375 camera stores. The group paid $16.25 million in cash and a $7.8 million note. Later, Ritz sold a $4 million account receivable for $1.5 million to an owner of the company that owed the debt. In the 2009 petition, Ritz disclosed total assets of $277 million and total debts of $172.1 million. Lawyers at Cole, Schotz, Meisel, Forman & Leonard, P.A., served as bankruptcy counsel. Thomas & Libowitz, P.A., served as the Debtor's special corporate counsel and conflicts counsel. Marc S. Seinsweig, at FTI Consulting, Inc., served as the Debtor's chief restructuring officer. Kurtzman Carson Consultants LLC acted as claims and noticing agent. Attorneys at Cooley Godward Kronish LLP and Bifferato LLC represented the official committee of unsecured creditors as counsel. In April 2010, the Court approved a liquidating Chapter 11 plan proposed by the company and the official creditor's committee. Under the Plan, unsecured creditors were to recover 4% to 14% of their claims. In the 2012 petition, RCI estimated total assets and liabilities of $50 million to $100 million. The Debtors owe not less than $16.32 million for term and revolving loans provided by secured lenders led by Crystal Finance LLC, as administrative agent. Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve as bankruptcy counsel. Kurtzman Carson Consultants LLC is the claims agent. WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as Ritz's CRO. Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC. Crystal Finance, the DIP lender, is represented by Morgan, Lewis & Bockius and Young Conaway Stargatt & Taylor LLP. Roberta A. Deangelis, U.S. Trustee for Region 3, appointed seven creditors to serve on the Official Committee of Unsecured Creditors in the Debtors' cases. RIVER-BLUFF ENTERPRISES: Sec. 341 Creditors' Meeting on Aug. 27 --------------------------------------------------------------- The Office of the U.S. Trustee for the Eastern District of California will convene a Meeting of Creditors under 11 U.S.C. Sec. 341(a) in the Chapter 11 case of River-Bluff Enterprises, Inc., on Aug. 27, 2012, at 1:30 p.m. at Office of the UST (7-500). The last day to oppose discharge is Oct. 26, 2012. Proofs of claim are due by Nov. 26, 2012. River-Bluff Enterprises, Inc., filed a Chapter 11 petition (Bankr. E.D. Calif. Case No. 12-92017) in Modesto, Calif. on July 20, 2012. The Debtor estimated assets of $10 million to $50 million and liabilities of at least $1 million. Judge Ronald H. Sargis presides over the case. David C. Johnston, Esq., at Johnston & Johnston, serves as bankruptcy counsel. The petition was signed by Roger Haney, president. RIVER-BLUFF ENTERPRISES: Status Conference Set for Aug. 29 ---------------------------------------------------------- The Bankruptcy Court will hold a Preliminary Status Conference in the Chapter 11 case of River-Bluff Enterprises, Inc., on Aug. 29, 2012, at 3:30 p.m. at Modesto Courtroom, Department E. River-Bluff Enterprises, Inc., filed a Chapter 11 petition (Bankr. E.D. Calif. Case No. 12-92017) in Modesto, Calif. on July 20, 2012. The Debtor estimated assets of $10 million to $50 million and liabilities of at least $1 million. Judge Ronald H. Sargis presides over the case. David C. Johnston, Esq., at Johnston & Johnston, serves as bankruptcy counsel. The petition was signed by Roger Haney, president. RYLAND GROUP: Reports $6.0 Million Net Income in Second Quarter --------------------------------------------------------------- The Ryland Group, Inc., reported net income of $6.27 million on $293.76 million of total revenues for the three months ended June 30, 2012, compared with a net loss of $10.71 million on $211.84 million of total revenues for the same period during the prior year. The Company reported net income of $1.16 million on $509.63 million of total revenues for the six months ended June 30, 2012, compared with a net loss of $30.24 million on $379.52 million of total revenues for the same period a year ago. The Company's balance sheet at June 30, 2012, showed $1.80 billion in total assets, $1.32 billion in total liabilities and $485.67 million in total equity. A copy of the press release is available for free at: http://is.gd/nYRlFh About Ryland Group Headquartered in Calabasas, California, The Ryland Group, Inc. (NYSE: RYL) -- http://www.ryland.com/-- is one of the nation's largest homebuilders and a leading mortgage-finance company. Since its founding in 1967, Ryland has built more than 285,000 homes and financed more than 240,000 mortgages. The Company currently operates in 15 states and 19 homebuilding divisions across the country and is listed on the New York Stock Exchange under the symbol "RYL." The Company reported a net loss of $50.75 million in 2011, a net loss of $85.14 million in 2010, and a net loss of $162.47 million in 2009. * * * Ryland Group carries 'B1' corporate family and probability of default ratings, with stable outlook, from Moody's. It has 'BB-' issuer credit ratings, with stable outlook, from Standard & Poor's. SAN JUAN BAUTISTA MEDICAL: Suit v Power Operator Goes to Trial -------------------------------------------------------------- In the lawsuit, San Juan Bautista Medical Center, Corp., Plaintiff, v. Puerto Rico Electric Power Authority, Defendant, Adv. Proc. No. 11-100 (Bankr. D.P.R.), Bankruptcy Judge Brian K. Tester denied the defendant's motion requesting reconsideration of the Court's June 1, 2012 order denying a motion for summary judgment. On April 26, 2011, San Juan Bautista Medical Center filed a complaint against the Puerto Rico Electric Power Authority for declaratory judgment under 28 U.S.C. Sec. 2201, and injunctive relief under 11 U.S.C. Sec. 362 and 11 U.S.C. Sec. 105. The Defendant, the Plaintiff and Intervenor: Escuela de Medicina San Juan Bautista filed simultaneous Motions for Summary Judgment. The Plaintiff filed a statement on supplemental briefing beyond the simultaneous Motions for Summary Judgment already filed, and the Defendant filed an Opposition to the Debtor's Motion for Summary Judgment and Memorandum of Law in support thereof. The motions for summary judgment were denied. The court found there was a disputed material fact that exists for trial. Specifically, whether the funds consigned in the amount of $400,000 by the San Juan Bautista School of Medicine with the Caguas Court of First Instance are property of the estate. The Defendant argues in its motion for reconsideration that there is no material fact in dispute with respect to the funds consigned in the amount of $400,000 by the San Juan Bautista School of Medicine with the Caguas Court of First Instance. The Defendant alleges the funds were not part of the estate because the funds were consigned with the court by a party different from the Plaintiff, who has not filed for bankruptcy, and was not protected by the automatic stay at the time of the consignation. The Defendant also argues in the alternative that if Article 1134 of the Puerto Rico Civil Code was applicable to the factual events in this case, the Plaintiff would have been able to withdraw the funds consigned and returned them to the estate, which the Plaintiff made no effort to do. Both of these theories were previously proffered and rejected by the court. According to Judge Tester, because the Defendant fails to establish any of the factors required, the court finds that the Defendant is not entitled to reconsideration. A copy of the Court's July 26, 2012 Opinion and Order is available at http://is.gd/9zxS67from Leagle.com. About San Juan Bautista Medical Center San Juan Bautista Medical Center Corp., which operates a namesake 190-bed hospital in Caguas, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D.P.R. Case No. 11-02270) on March 18, 2011. San Juan Bautista was part of the government's plan to start a medicalization program for drug addicts. The hospital has 150 beds for patients with physical ailments and 40 beds for mental- health patients. At the time of its bankruptcy filing, the medical facility was trying to stop Puerto Rico Electric Power Authority from cutting off electricity to the Debtor's San Juan Bautista School of Medicine. Carmen D. Conde Torres, Esq., at C. Conde & Associates, serves as the Debtor's counsel. In its petition, the facility listed under $50,000 in assets and under $50 million in debts. The petition was signed by Lymari Colon, president of governing board. SPRINT NEXTEL: Incurs $1.4 Billion Net Loss in Second Quarter ------------------------------------------------------------- Sprint Nextel Corp. reported a net loss of $1.37 billion on $8.84 billion of net operating revenues for the quarter ended June 30, 2012, compared with a net loss of $847 million on $8.31 billion of net operating revenues for the same period during the prior year. Sprint Nextel's balance sheet at June 30, 2012, showed $49.02 billion in total assets, $39.79 billion in total liabilities and $9.22 billion in total shareholders' equity. "The Sprint platform achieved best ever postpaid ARPU and customer churn that, combined with disciplined customer acquisition and cost management, contributed to our Adjusted OIBDA* of $1.45 billion," said Dan Hesse, Sprint CEO. "Based on this performance, we are raising the 2012 Adjusted OIBDA* forecast to between $4.5 billion and $4.6 billion." A copy of the press release is available for free at: http://is.gd/aLKIS8 About Sprint Nextel Overland Park, Kan.-based Sprint Nextel Corp. (NYSE: S) -- http://www.sprint.com/-- is a communications company offering a comprehensive range of wireless and wireline communications products and services that are designed to meet the needs of individual consumers, businesses, government subscribers and resellers. * * * In February 2012, Moody's Investors Service assigned a B3 rating to Sprint Nextel's proposed offering of Senior Unsecured Notes and a Ba3 rating to Sprint's proposed offering of Junior Guaranteed Unsecured Notes. The proceeds will be used for general corporate purposes, the repayment of existing debt, network expansion and modernization, and the potential funding of Clearwire. All of Sprint's ratings remain on review for possible downgrade, including those assigned and the company's B1 corporate family rating and B1 probability of default rating. Standard & Poor's Ratings Services assigned its 'BB-' issue-level rating and '2' recovery rating to Sprint's proposed $1 billion of senior guaranteed notes due 2020. These notes have subordinated guarantees from all the subsidiaries that guarantee the existing $2.25 billion revolving credit facility. The '2' recovery rating indicates expectations for substantial (70% to 90%) recovery in the event of payment default. Fitch Ratings has assigned ratings to Sprint's $2 billion notes offering. This includes a 'BB/RR2' rating to the junior guaranteed unsecured notes due 2020 and a 'B+/RR4' rating to the unsecured senior notes due 2017. SEQUENOM INC: Incurs $29.6 Million Net Loss in Second Quarter ------------------------------------------------------------- Sequenom, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $29.62 million on $18.25 million of total revenues for the three months ended June 30, 2012, compared with a net loss of $20.93 million on $13.33 million of total revenues for the same period during the prior year. The Company reported a net loss of $54.07 million on $33.17 million of total revenues for the six months ended June 30, 2012, compared with a net loss of $33.60 million on $26.84 million of total revenues for the same period a year ago. The Company's balance sheet at June 30, 2012, showed $161.05 million in total assets, $59.03 million in total liabilities and $102.02 million in total stockholders' equity. "We have continued to see strong increases in the uptake of the MaterniT21 PLUS laboratory developed test (LDT) and Sequenom CMM has now analyzed more than 20,000 test samples since the product was launched in October of last year. We have been able to effectively meet this increasing demand by expanding our operational capacity so that we can continue to meet the needs of our physician customers and their patients in a prompt and timely manner," said Harry Hixson, Jr., Ph.D., Chairman and CEO of Sequenom. "We believe that our operational model, additional efforts and test enhancements planned for the second half of the year will position us well for sustainable growth and product leadership going forward." A copy of the Form 10-Q is available for free at: http://is.gd/kf1Xny About Sequenom Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a life sciences company committed to improving healthcare through revolutionary genetic analysis solutions. Sequenom develops innovative technology, products and diagnostic tests that target and serve discovery and clinical research, and molecular diagnostics markets. The company was founded in 1994 and is headquartered in San Diego, California. The Company reported a net loss of $74.15 million in 2011, a net loss of $120.84 million in 2010, and a net loss of $71.01 million in 2009. STEREOTAXIS INC: Regains Compliance with Min. Bid Price Rule ------------------------------------------------------------ Stereotaxis, Inc., received a notification from the Nasdaq Stock Market confirming that the Company has regained compliance with Listing Rule 5450(a)(1), as the bid price of the Company's common stock closed at $1.00 per share or more for at least ten consecutive business days prior to July 25, 2012. Prior to that, on July 20, 2012, Nasdaq notified the Company that its Common Stock was subject to delisting from the Nasdaq Global Market because the Company did not regain compliance with the Minimum Bid Price Rule by July 18, 2012, the deadline for compliance pursuant to Nasdaq's notification letter dated Jan. 20, 2012. Since the Company has regained compliance with the Minimum Bid Price Rule, Nasdaq advised in its July 25 letter that it considers this matter to be closed. About Stereotaxis Based in St. Louis, Mo., Stereotaxis, Inc., designs, manufactures and markets the Epoch Solution, which is an advanced remote robotic navigation system for use in a hospital's interventional surgical suite, or "interventional lab", that the Company believes revolutionizes the treatment of arrhythmias and coronary artery disease by enabling enhanced safety, efficiency and efficacy for catheter-based, or interventional, procedures. For the year ended Dec. 31, 2011, Ernst & Young LLP, in St. Louis, Missouri, expressed substantial doubt about Stereotaxis' ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring operating losses and has a working capital deficiency. The Company reported a net loss of $32.0 million for 2011, compared with a net loss of $19.9 million for 2010. The Company's balance sheet at March 31, 2012, showed $36.79 million in total assets, $60.16 million in total liabilities, and a $23.36 million total stockholders' deficit. ROSETTA GENOMICS: Signs Co-Marketing Agreement with Precision ------------------------------------------------------------- Rosetta Genomics Ltd. has entered into a co-marketing agreement for its miRview mets assay for the accurate identification of the tumor of origin in Cancers of Unknown or Uncertain Primary with Precision Therapeutics Inc., a life science company known for its expertise in the science of personalizing cancer therapy by advancing genomic testing and bioinformatics. Under the terms of the agreement, Rosetta Genomics granted Precision Therapeutics the co-exclusive right, along with Rosetta Genomics, to co-market the miRview mets assay in the U.S. through July 30, 2014, with certain pre-specified performance milestones. Rosetta Genomics will continue to record all revenues for miRview mets and will remain responsible for sample collection, processing and billing. Precision Therapeutics, with one of the largest sales forces in oncology diagnostics and considerable experience in the personalized medicine sector, is expected to launch its miRview mets2 co-marketing effort in August 2012. "Precision Therapeutics is a strong partner to help maximize the potential of miRview mets in a critically important market, where accurate identification of the primary cancer directly impacts treatment decisions. With approximately 200,000 CUP patients in the U.S., we believe this co-marketing agreement will significantly enhance our reach and access to the physicians who diagnose cancer and who treat these patients, including pathologists and oncologists," said Kenneth A. Berlin, President and Chief Executive Officer of Rosetta Genomics. "This co- marketing agreement, as well as the recent Medicare decision to reimburse the miRview mets assay, significantly strengthens our prospects for widespread market adoption and revenue growth." "We are especially pleased to partner with Rosetta Genomics to enhance the commercial distribution of the miRview mets assay, as it is a best-in-class CUP assay that utilizes cutting-edge microRNA expression as a platform, which we believe provides greater accuracy in identifying these difficult to diagnose tumors of unknown or uncertain origin. The data reported from external validation studies show a high level of concordance between the miRview mets assay and expert diagnoses in true CUP patients demonstrating the clinical benefit of looking at microRNA," stated Sean McDonald, President and Chief Executive Officer of Precision Therapeutics. "This collaboration with Rosetta Genomics underscores our commitment to offering high quality and high utility solutions to physicians along the entire continuum of care with the goal to improve outcomes for patients. Together with Rosetta Genomics' dedicated oncology team, we will reach out to an even larger group of healthcare providers in order to benefit patients who are diagnosed with CUP," added Mr. McDonald. About Rosetta Located in Rehovot, Israel, Rosetta Genomics Ltd. is seeking to develop and commercialize new diagnostic tests based on a recently discovered group of genes known as microRNAs. MicroRNAs are naturally expressed, or produced, using instructions encoded in DNA and are believed to play an important role in normal function and in various pathologies. The Company has established a CLIA- certified laboratory in Philadelphia, which enables the Company to develop, validate and commercialize its own diagnostic tests applying its microRNA technology. In its auditors' report for the 2011 financial statements, Kost Forer Gabbay & Kasierer, in Tel-Aviv, Israel, expressed substantial doubt about Rosetta Genomics' ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring operating losses and generated negative cash flows from operating activities in each of the three years in the period ended Dec. 31, 2011. The Company reported a net loss after discontinued operations of $8.83 million on $103,000 of revenues for 2011, compared with a net loss after discontinued operations of $14.76 million on $279,000 of revenues for 2010. The Company's balance sheet at Dec. 31, 2011, showed $2.04 million in total assets, $2.40 million in total liabilities, and a stockholders' deficit of $356,000. Bankruptcy Warning The Company said in its annual report for the year ended Dec. 31, 2011, "We have used substantial funds to discover, develop and protect our microRNA tests and technologies and will require substantial additional funds to continue our operations. Based on our current operations, our existing funds, including the proceeds from the January 2012 debt financing, will only be sufficient to fund operations until late May, 2012. We intend to seek funding through collaborative arrangements and public or private equity offerings and debt financings. Additional funds may not be available to us when needed on acceptable terms, or at all. In addition, the terms of any financing may adversely affect the holdings or the rights of our existing shareholders. For example, if we raise additional funds by issuing equity securities, further dilution to our then-existing shareholders may result. Debt financing, if available, may involve restrictive covenants that could limit our flexibility in conducting future business activities. If we are unable to obtain funding on a timely basis, we may be required to significantly curtail one or more of our research or development programs. We also could be required to seek funds through arrangements with collaborators or others that may require us to relinquish rights to some of our technologies, tests or products in development or approved tests or products that we would otherwise pursue on our own. Our failure to raise capital when needed will materially harm our business, financial condition and results of operations, and may require us to seek protection under the bankruptcy laws of Israel and the United States." SHUANEY IRREVOCABLE: Court OKs Motion to Prohibit Cash Collateral ----------------------------------------------------------------- The U.S. Bankruptcy Court has approved Beach Community Bank's motion to prohibit Shuaney Irrevocable Trust from using the bank's cash collateral. BCB is a federally insured banking entity organized and operating in the State of Florida, and is on the U.S. Trustee's approved list of Authorized Depositories in the Northern District of Florida. BCB said the Debtor owed the bank $12,921,430 as of Dec. 1, 2011. The Debtor has three accounts with BCB. Those accounts include a money market account with a balance of $3,125,000 an interest reserve account with a balance of $369,000, and a checking account with a balance of $40. BCB maintains that it has a perfected prepetition security interest on the funds in the money market and interest reserve accounts and, as such, the deposited funds constitute cash collateral. At no time prior to the Debtor's filing of bankruptcy has the money market account or the interest reserve account been used to fund Shuaney's operations -- only its obligations to BCB. BCB says it is an undersecured creditor. BCB says it is concerned that the Trustees of the Shuaney Irrevocable Trust will use the bank's cash collateral without court order for expenses wholly unrelated to the Trust. BCB says such use of the funds by the Trustees of the Debtor would cause irreparable harm to the bank as the Debtor's schedules reflect it does not otherwise have funds with which to work. About Shuaney Irrevocable Trust Shuaney Irrevocable Trust, in Fort Walton Beach, Florida, filed for Chapter 11 bankruptcy (Bankr. N.D. Fla. Case No. 11-31887) on Dec. 1, 2011. The Debtor scheduled $20,996,723 in assets and $19,625,890 in debts. The Law Office of Mark Freund serves as counsel to the Debtor. Judge William S. Shulman presides over the case. SJJ CORP: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------- Debtor: SJJ Corp 2510 84th S 24D Lakewood, WA 98499 Bankruptcy Case No.: 12-45250 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Brian D. Lynch Debtor's Counsel: Kevin T. Helenius, Esq. 40 Lake Bellevue Ste 100 Bellevue, WA 98005 Tel: (425) 450-7011 E-mail: efiling@kth-law.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb12-45250.pdf The petition was signed by Soo Jin Jung, president. SUNCOKE ENERGY: S&P Puts 'BB-' Corp. Credit Rating on Watch Neg --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings, including its 'BB-' corporate credit rating, on Lisle, Ill-based SunCoke Energy Inc. on CreditWatch with negative implications. "The CreditWatch negative listing means we could lower or affirm the rating after we complete our review," S&P said. "The CreditWatch listing reflects our view that that the company's credit quality could decline as a result of the proposed formation of a master limited partnership structure, which the company's board of directors approved on July 19, 2012," said credit analyst Marie Shmaruk. "At the same time, the board approved the filing of a registration statement to effect the initial public offering of the MLP." "In resolving the CreditWatch listing, we will review the company's filing for the MLP when it becomes available. We will also evaluate the company's financial policy, proposed capital structure, and their effect on the company's credit metrics." TOWNSEND CORP: Plan Filing Deadline Extended to Oct. 3 ------------------------------------------------------ The Bankruptcy Court extended the periods within which Townsend Corporation, d/b/a Land Rover Jaguar Anaheim Hills, and LRJC, Inc., d/b/a Land Rover Jaguar Cerritos have the exclusive right to file a chapter 11 plan through Oct. 3, 2012 and the exclusive right to solicit acceptances on that plan through Dec. 3, 2012. Auto dealers Townsend Corporation, d/b/a Land Rover Jaguar Anaheim Hills, and LRJC, Inc., d/b/a Land Rover Jaguar Cerritos -- http://www.lrjah.com/and http://lrjcerritos.com/-- filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case Nos. 11-22690 and 11-22695) on Sept. 9, 2011. The Debtors sell new Jaguar and Land Rover vehicles and various previously owned vehicles. The Debtors also have service and parts departments. The Debtors are principally owned and operated by Ernest Townsend and his son, Joshua Townsend. LRJ Anaheim has been in business since 2000. LRJ Cerritos has been in business since 2006. The Chapter 11 cases were reassigned from Judge Robert N. Kwan to Judge Catherine E. Bauer. Todd M. Arnold, Esq., and Martin J. Brill, Esq., at Levene, Neale, Bender, Yoo & Brill, LLP, represent the Debtors. Each of the Debtors estimated $10 million to $50 million in both assets and debts. The petitions were signed by Ernest W. Townsend, IV, the president. TRAC INTERMODAL: Moody's Assigns B1 CFR, Rates 2nd Lien Notes B3 ---------------------------------------------------------------- Moody's Investors Service has assigned a B3 rating to Trac Intermodal LLC's proposed second lien notes due 2019. At the same time, Moody's assigned Corporate Family Rating ('CFR') of B1 and a Probability of Default Rating ('PDR') of B2. The ratings outlook is stable. Ratings Rationale Trac's ratings incorporate a B2 probability of default profile that reflects high leverage and substantial operating risks associated with on-going changes in the company's business model. These factors are offset by substantial recovery that would be provided by the strong value in company's fleet of leasing equipment that supports a one-notch uplift of the Corporate Family Rating above the company's Probability of Default Rating. With approximately $1 billion in total debt (including Moody's standard adjustments) on close of refinancing, Trac's pro forma Debt to EBITDA is estimated at over 7 times, which is high relative to B2-rated entities. Other credit metrics are more closely aligned with the assigned ratings: pro forma Funds from Operations (FFO) plus Interest to Interest of approximately 2.4 times, Retained Cash Flow to Debt of 10%, and Tangible Common Equity to Tangible Managed Assets of approximately 20%. The CFR, at B1, is rated one notch above the B2 PDR, reflecting the significant recovery to secured lenders provided by Trac's sizeable asset base. Trac maintains a strong franchise position as a leading provider of intermodal chassis to the US transportation sector, with a lease fleet of over 250,000 chassis units whose book value is approximately $1.2 billion. Considering the mobile nature of the assets in the lease fleet, the commonality of this equipment to intermodal operators, and the essentiality of Trac's chassis to the US transportation network, Moody's estimates that the value of Trac's lease fleet would contribute to substantial recovery to senior secured debt holders in the event of default. As such, a 65% family recovery rate has been assigned to Trac's ratings per Moody's Loss Given Default ('LGD') Methodology, which results in a CFR that is one notch above the PDR. Moody's also notes risks associated with on-going changes in Trac's revenue profile. The company is transitioning from a predominantly term leasing business to one that relies increasingly on a pool subscription model that services the growing motor carrier customer base. This shift could result in improving operating margins, as per diem rates are considerably higher in the pooling business. However, pooling operations also entail higher costs and lower utilization rates, which suggests that proper execution of this strategy will be important to realize planned increases in operating margins going forward. The $325 million of second lien notes are rated B3, which is two notches below the Corporate Family Rating, reflecting the substantial level of first lien debt senior in claim to this instrument, and the lower estimated recovery assessed on the second lien notes per Moody's LGD Methodology. Moody's believes that Trac maintains an adequate liquidity position. The company maintains a modest cash balance, and is expected to generate positive free cash flow over the near term while maintaining a robust level of fleet investment to meet growing demand. On close of refinancing transactions, Trac will have a $700 million ABL facility due 2017, with approximately $470 million drawn. Moody's views the nearly-$230 million of remaining availability as quite robust for a company of this size. Moreover, it is expected that the company will use free cash generated to repay a modest portion of the amount outstanding under this facility over the next few years. Moody's estimates that the company will be compliant with financial covenants prescribed under the new ABL facility. The stable ratings outlook reflects Moody's expectations that the company will be able to grow its revenue over the near term in an environment of strong intermodal equipment demand, while improving margins as the company takes on more higher-yielding subscription- based leasing contracts. This will likely result in leverage and interest coverage metrics that more strongly support the B1 CFR and B2 PDR. Ratings or their outlook could be adjusted downward if margins fall, possibly from weak lease yields or a deterioration in utilization rates that may ensue from unexpected changes in the competitive landscape of the intermodal equipment leasing industry. Debt to EBITDA sustained above 7.5 times, FFO plus Interest to Interest of less than 1.5 times, or persistently negative free cash flow and a deterioration in liquidity could result in a ratings downgrade. Upward rating consideration could be warranted if the company were to repay a substantial portion of its debt while improving operating margins and growing its fleet, such that Debt to EBITDA were to fall below 5.5 times, FFO plus Interest to Interest were to exceed 2.5 times, or Retained Cash Flow to Debt exceeds 12%. Assignments: Issuer: Trac Intermodal LLC Probability of Default Rating, Assigned B2 Corporate Family Rating, Assigned B1 Senior Secured Regular Bond/Debenture, Assigned B3, LGD4-63% The principal methodology used in rating Trac Intermodal LLC was the Global Business and Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Trac Intermodal, LLC, through its main operating subsidiary Interpool, Inc., is headquartered in Princeton, NJ and is a leading provider of intermodal chassis to the transportation industry. TXCO RESOURCES: Wins $15MM Judgment Against Peregrine Petroleum --------------------------------------------------------------- Reorganized TXCO Resources, Inc., won a $15,873,383 judgment against Peregrine Petroleum, L.L.C., in a lawsuit that accused Peregrine of misappropriating TXCO's confidential and trade secret information that Peregrine obtained when the parties engaged in acquisition talks. The Court also held Peregrine received TXCO's trade secrets by improper means through Jeff Bookout after he was terminated from TXCO. The Court said the materials TXCO disclosed to Peregrine gave it a competitive advantage over TXCO and other competitors. The judgment is for "reasonable" royalty. All other requested relief in the lawsuit are denied. A copy of Chief Bankruptcy Judge Ronald B. King's July 26, 2012 Opinion is available at http://is.gd/JNiYYBfrom Leagle.com. About TXCO Resources TXCO Resources, Inc., was a publicly traded oil and gas exploration and production company based in San Antonio, Texas, which, along with its subsidiaries, filed a voluntary Chapter 11 case (Bankr. W.D. Tex. Case No. 09-51807) on May 17, 2009. Prior to confirmation, TXCO agreed to sell most of its oil and gas assets to Newfield Exploration Company and Anadarko E&P Company L.P. The sale was included in TXCO's Second Amended Plan of Reorganization. On Jan. 27, 2010, the Court entered an order confirming the Plan. On Feb. 11, 2010, the Plan became effective and Reorganized TXCO emerged from Chapter 11. All creditors were paid in full, including interest and attorney's fees, and equity holders received a distribution. The remaining oil and gas assets that were not transferred to Newfield or Anadarko were transferred to the TXCO Liquidating Trust. Newfield is the only shareholder of record in Reorganized TXCO and the sole beneficiary of the Liquidating Trust. UNION CENTER: Case Summary & 8 Unsecured Creditors -------------------------------------------------- Debtor: Union Center C, LLC 3455 Peachtree Industrial Boulevard Suite 305, PMB 263 Duluth, GA 30096 Bankruptcy Case No.: 12-22613 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court Northern District of Georgia (Gainesville) Debtor's Counsel: William A. Rountree, Esq. MACEY, WILENSKY, KESSLER & HENNINGS LLC Suite 2700 230 Peachtree Street, NW Atlanta, GA 30303-1561 Tel: (404) 584-1200 Fax: (404) 681-4355 E-mail: mharris@maceywilensky.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 unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ganb12-22613.pdf The petition was signed by Scott A. Henson, sole member. USEC INC: Dr. Joyce Brown Resigns from Board of Directors --------------------------------------------------------- Dr. Joyce F. Brown resigned as a member of the Board of Directors of USEC Inc. in order to devote more time to her other professional commitments. Dr. Brown has been a director since 1998. About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- supplies enriched uranium fuel for commercial nuclear power plants. The Company reported a net loss of $540.70 million in 2011, compared with net income of $7.50 million in 2010. USEC Inc.'s balance sheet at March 31, 2012, showed $3.77 billion in total assets, $3.04 billion in total liabilities and $728.9 million in stockholders' equity. * * * USEC Inc. carries 'Caa1' corporate and probability of default ratings, with "developing" outlook, from Moody's, and 'CCC+' long term foreign issuer credit rating and 'CCC-' long term local issuer credit rating, with outlook "developing", from Standard & Poor's. In May 2010, S&P said that its rating and outlook on USEC Inc. are not affected by the announcement that Toshiba Corp. and Babcock & Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co., have signed a definitive investment agreement for $200 million with USEC. USG CORP: Incurs $57 Million Net Loss in Second Quarter ------------------------------------------------------- USG Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $57 million on $825 million of net sales for the three months ended June 30, 2012, compared with a net loss of $70 million on $761 million of net sales for the same period during the prior year. The Company reported a net loss of $84 million on $1.63 billion of net sales for the six months ended June 30, 2012, compared with a net loss of $175 million on $1.48 billion of net sales for the same period a year ago. The Company's balance sheet at June 30, 2012, showed $3.64 billion in total assets, $3.51 billion in total liabilities and $131 million in total stockholders' equity including noncontrolling interest. "We are pleased to build on the positive operating profit in the first quarter with another quarter of improved results," said James S. Metcalf, Chairman, President and CEO. "In addition, our recent announcement of a joint venture that will enable us to sell SHEETROCK Brand gypsum wallboard in India is a major step forward in our efforts to diversify USG's sources of earnings. We intend to move quickly with our partner, the Zawawi Group of Oman, to establish the mining and manufacturing operations in Oman with the goal of commencing the sale of rock to the regional cement industry and wallboard in the Indian market toward the end of next year." A copy of the Form 10-Q is available for free at: http://is.gd/kQfhdp About USG Corporation Based in Chicago, Ill., USG Corporation -- http://www.usg.com/-- through its subsidiaries, manufactures and distributes building materials producing a wide range of products for use in new residential, new nonresidential and repair and remodel construction, as well as products used in certain industrial processes. The company filed for Chapter 11 protection on June 25, 2001 (Bankr. Del. Case No. 01-02094). When the Debtors filed for protection from their creditors, they disclosed $3.252 billion in assets and $2.739 billion in liabilities. The Debtors emerged from bankruptcy protection on June 20, 2006. The Company reported a net loss of $390 million in 2011 and a net loss of $405 million in 2010. * * * As reported by the TCR on Aug. 15, 2011, Standard & Poor's Ratings Services lowered its corporate credit rating on USG Corp. to 'B' from 'B+'. "The downgrade reflects our expectation that USG's operating results and cash flow are likely to be strained over the next year due to the ongoing depressed level of housing starts and still- weak commercial construction activity," said Standard & Poor's credit analyst Thomas Nadramia. "It is now more likely, in our view, that any meaningful recovery in housing starts may be deferred until late 2012 or into 2013. As a result, the risk that USG's liquidity in the next 12 to 24 months will continue to erode (and be less than we incorporated into our prior ratings) has increased. The ratings previously incorporated a greater improvement in housing starts, which would have enabled USG to reduce its negative operating cash flow in 2012 and achieve breakeven cash flow or better by 2013." In the Sept. 14, 2011, edition of the TCR, Fitch Ratings has downgraded USG Corporation's Issuer Default Rating (IDR) to 'B-' from 'B'. The Rating Outlook remains Negative. The ratings downgrade and the Negative Outlook reflect Fitch's belief that underlying demand for the company's products will remain weak through at least 2012 and the company's liquidity position is likely to deteriorate in the next 18 months. With the recent softening in the economy and lowered economic growth expectations for 2011 and 2012, the environment may at best support a relatively modest recovery in housing metrics over the next year and a half. Fitch had previously forecast a slightly more robust housing environment in 2011 and 2012. Moreover, new commercial construction is expected to decline further this year and may only grow moderately next year. VALENCE TECHNOLOGY: Shareholders Accuse Berg of Power Grab ---------------------------------------------------------- Dan Zehr at statesman.com reports that a group of Valence shareholders have accused Carl Berg, the largest shareholder in Valence Technology Inc., of a power grab, claiming that the chairman is using the Chapter 11 bankruptcy reorganization process to take even greater control of the company he has propped up for much of its 23-year existence. According to the report, with all the company's assets pledged as collateral on loans he provided, Mr. Berg and his companies could emerge from the proceedings as Valence's sole owners. And while they readily admit that Valence would have failed long ago had Mr. Berg not pumped well more than $100 million into the company over the years, the shareholders question why -- after saying he would continue to fund the company as long as it was making progress -- he chose to turn off the valve just as Valence appeared poised to finally post a profit. "They were presenting themselves as just about to break even and just needing some more money," the report quotes Michael Stavy, an energy economist and Valence shareholder, as saying. "Since Carl Berg was funding it all these years, why change now?" The report relates some of the company's shareholders say Mr. Berg cut off funding and steered Valence toward bankruptcy so he could consolidate ownership of the company. Some of those investors have retained Dallas attorney Hamilton Lindley, Esq., and are planning to file a securities lawsuit against the company. Mr. Lindley said he is investigating potential claims and hopes to file a formal complaint before the company's Chapter 11 reorganization concludes, the report says. The report notes although investors and lenders pumped more than $600 million into the company since its launch in 1989, it has yet to produce a dime of profit. The report says Mr. Berg, who amassed a fortune in Silicon Valley real estate before turning to venture capital investments, had regularly stepped in at crucial times to fund the company's operations and keep it afloat. On multiple occasions, he and company executives said those critical capital infusions would continue as long as Valence showed progress. The report relates, however, with the company facing a $3 million payment by July 31 -- the final payment on a $20 million debt issuance from 2005 -- Mr. Berg didn't provide any new funding. "A $3 million debt didn't seem like an insurmountable amount given Berg's past investments," Mr. Lindley said. The report adds Valence executives and board members sought at least one alternative source of capital. However, they rejected the terms offered by Silicon Valley Bank -- Mr. Berg declined to subordinate his loans to the bank's -- and the board voted to file for bankruptcy protection. About Valence Technology Valence Technology, Inc., filed a voluntary petition for a chapter 11 business reorganization (Bankr. W.D. Tex. Case No. 12-11580) on July 12, 2012. The Debtor disclosed debt of $82.6 million and assets of $31.5 million as of March 31. Streusand, Landon & Ozburn, LLP, serves as the Company's counsel. Founded in 1989, Valence develops lithium iron magnesium phosphate rechargeable batteries. Its products are used in hybrid and electric vehicles, as well as hybrid boats and Segway personal transporters. As reported by the TCR on July 13, 2012, the reorganization is intended to bolster the Company's liquidity in the U.S. and abroad and enable the Company to focus on its core lithium phosphate markets. VALERO ENERGY: Moody's Issues Summary Credit Opinion ---------------------------------------------------- Moody's Investors Service issued a summary credit opinion on Valero Energy Corporation and includes certain regulatory disclosures regarding its ratings. This release does not constitute any change in Moody's ratings or rating rationale for Valero. Moody's current ratings for Valero Energy Corporation and related companies are: Valero Energy Corporation Senior Unsecured (domestic currency) Rating of Baa2 Pref. Stock (domestic currency) Rating of Ba1 Senior Unsec. Shelf (domestic currency) Rating of (P)Baa2 Subordinate Shelf (domestic currency) Rating of (P)Baa3 Junior Subord. Shelf (domestic currency) Rating of (P)Baa3 Pref. Shelf (domestic currency) Rating of (P)Ba1 BACKED Senior Unsecured (domestic currency) Rating of Baa2 BACKED Subordinate (domestic currency) Rating of Baa3 Ultramar Diamond Shamrock Corporation BACKED Senior Unsecured (domestic currency) Rating of Baa2 BACKED Subordinate (domestic currency) Rating of Baa3 Diamond Shamrock Inc. BACKED Senior Unsecured (domestic currency) Rating of Baa2 VEC Trust II BACKED Pref. Shelf (domestic currency) Rating of (P)Baa3 VEC Trust III BACKED Pref. Shelf (domestic currency) Rating of (P)Baa3 VEC Trust IV BACKED Pref. Shelf (domestic currency) Rating of (P)Baa3 Ratings Rationale Valero's Baa2 senior unsecured ratings are supported by its large operating scale, solid diversification of unplanned downtime risk and regional margin risk within its 15 refinery portfolio, comparatively high process complexity, moderate earnings contribution from its retail and ethanol operations, investment grade financial leverage metrics and good liquidity. The ratings are restrained by inherent refining sector cyclicality and volatility, heavy capital spending levels, degree of shareholder return focus, acquisition event risk and the uncertainties regarding the ultimate impact of the regulation of greenhouse gases in California. The stable outlook reflects the assumption that Valero will maintain investment grade leverage metrics through 2013 as it continues to pursue organic growth and acquisition opportunities. Over the near-term, given acquisition risk and the uncertainties regarding the ultimate impact of the regulation of greenhouse gases in California, Moody's does not expect a ratings upgrade. Longer term, ratings might benefit from very substantial de- leveraging (reducing debt sufficiently in order to maintain in excess of 20% retained cash flow/debt in a cyclical low) relative both to Valero's cash flow through the cycle and its total capital or material diversification into other business lines. Valero's ratings or outlook could be pressured by large negative free cash flow generation and rising debt levels (resulting in retained cash flow/debt declining to less than 15% for a sustained period extending beyond a short-term down-cycle), a materially debt financed acquisition or debt financed share buybacks, or weak liquidity profile. The principal methodology used in rating Valero Energy Corporation was the Global Refining and Marketing Industry Methodology published in December 2009. VIASPACE INC: Fails to Reach Deal on VGE Separation --------------------------------------------------- VIASPACE Inc. and its subsidiary VIASPACE Green Energy Inc. said that as previously announced they agreed to embark on a series of negotiations with Mr. Sung Chang to separate VIASPACE and VGE. During this time, Mr. Chang has not declared in writing that VIASPACE is in default on the existing note due to him and agreed to negotiate in good faith for an agreement that would be satisfactory to him and the VIASPACE and VGE Boards. The VIASPACE Board led by Dr. Kevin Schewe has been negotiating fervently with Mr. Chang for several months. As of this date, the parties have not reached agreement and signed the term sheets to separate the companies. VIASPACE Director Dr. Kevin Schewe stated, "Along with the many, many public shareholders, I am disappointed that a deal has not been reached. Over the past few years, I have purchased nearly 100 million shares of VIASPACE stock and I am as frustrated as many of you. I strongly believe that VIASPACE's most recent proposal offers Mr. Chang a potential resolution which addresses his desire not to fund VIASPACE any longer through Inter-Pacific Arts sales or future China pellet sales and simultaneously gives him and all VIASPACE shareholders a reasonable chance of increasing shareholder value. Sadly, we have reached another impasse with Mr. Chang and his lawyer. I cannot in good conscience sign a term sheet that I believe is not in the best interest of all of my fellow VIASPACE shareholders. We are not giving up, but we are disappointed. I am encouraging the VIASPACE Board of Directors to give Mr. Chang our best and final offer by July 27, 2012 with a deadline for response by Mr. Chang on or before July 31, 2012. The Company will provide another update on July 31, 2012, or sooner if negotiations are concluded." About VIASPACE Inc. Irvine, Calif.-based VIASPACE Inc. (OTC Bulletin Board: VSPC - News) -- http://www.VIASPACE.com/-- is a clean energy company providing products and technology for renewable and alternative energy that reduce or eliminate dependence on fossil and high- pollutant energy sources. Through its majority-owned subsidiary VIASPACE Green Energy Inc., the Company grows Giant King Grass as a low carbon fuel for electricity generating power plants and as a feedstock for cellulosic biofuels. Viaspace reported a net loss of $668,000 on $588,000 of total revenues for the three months ended March 31, 2012. The Company reported a net loss of $9.36 million in 2011, compared with a net loss of $2.96 million in 2010. The Company's balance sheet at March 31, 2012, showed $9.82 million in total assets, $7.32 million in total liabilities and $2.50 million in total equity. Going Concern The Company has incurred significant losses from operations, resulting in an accumulated deficit of $43,650,000. The Company expects such losses to continue. In addition, the Company has limited working capital and based on current cash flows does not have sufficient funds to pay the May 14, 2012, installment due on the note to Changs LLC. These raises substantial doubt about the Company's ability to continue as a going concern. After auditing the financial results for the year ended Dec. 31, 2011, Hein & Associates LLP, in Irvine, Calif., expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that he Company has incurred significant losses from operations, resulting in an accumulated deficit of $43.05 million. The Company expects those losses to continue. In addition, the Company has limited working capital and based on current cash flows does not have sufficient funds to pay the May 2012 instalment due on the note to Changs LLC. VOLKSWAGEN-SPRINGFIELD: Trustee to Name Consumer Privacy Ombudsman ------------------------------------------------------------------ The Hon. Robert G. Mayer of the U.S. Bankruptcy Court for the Eastern District of Virginia directed the U.S. Trustee to appoint a consumer privacy ombudsman in the Chapter 11 case of Volkswagen- Springfield, Inc. The Debtor related that from time-to-time, it collected information regarding its customers including names, addresses, email addresses, telephone numbers and other similar data. The data is included among the assets under the purchase agreement. In a separate filing, the Court has approved the bidding procedures in relation to the sale of substantially of its assets, including the assumption and assignment of certain executory contracts and unexpired leases. The Debtor has entered into an asset purchase agreement with Sheehy Auto Stores, Inc. Pursuant to the APA, Sheehy agreed to purchase the assets for $22 million subject to higher and better offers. Sheehy will be entitled to a break-up fee of $187,500 plus its reasonable fees and expenses relating to Sheehy's efforts to acquire the Debtor's assets in the event it is not the successful bidder. The Debtor believes that the sale along with proceeds of assets excluded from the sale will be sufficient to satisfy BB&T's liens in full. BB&T claims that it is owed approximately $18.15 million exclusive of professional fees and expenses. Any remaining proceeds, and excluded assets, will be available to pay costs of administration and the Debtor's priority and general unsecured creditors. The purchase agreement provides further that Sheehy will have a superpriority administrative expense priority claim payable out of the Debtor's cash or other collateral securing VWS's obligations (which will be senior to any and all claims and interests) for such amounts. A copy of the bidding procedures is available for free at http://bankrupt.com/misc/VOLKSWAGEN_sale_biddingprocedures.pdf About Volkswagen-Springfield Springfield, Virginia-based Volkswagen-Springfield, Inc., filed a Chapter 11 petition (Bankr. E.D. Va. Case No. 12-12905) in Alexandria on May 7, 2012. The Debtor operates one of the largest Volkswagen franchised dealerships in the Mid-Atlantic region. The Debtor estimated assets and debts of $10 million to $50 million as of the Chapter 11 filing. Judge Robert G. Mayer oversees the case. The Debtor is represented by Dylan G. Trache, Esq., and John T. Farnum, Esq., at Wiley Rein LLP, in McLean, Virginia. Pursuant to recent default notices, Branch Banking and Trust Company has asserted that it is owed $19.6 million. Jonathan L. Hauser, Esq., at Troutman Sanders LLP, represents BB&T. No creditors' committee has yet been appointed in the case VOLKSWAGEN-SPRINGFIELD: Court Approves Wiley Rein as Counsel ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Virginia, according to Volkswagen-Springfield, Inc.'s case docket, authorized the Debtor to employ Wiley Rein LLP as counsel. As reported in the Troubled Company Reporter on June 28, 2012, Dylan G. Trache, a partner at Wiley Rein LLP, told the Court that prior to the Petition Date, Wiley Rein received a $100,00 retainer from the Debtor. Prior to the filing of the Petition, Wiley Rein withdrew the sum of $33,957 from the retainer and applied it against prepetition services well as the filing fee for the Chapter 11 case. As of the filing of the Chapter 11 case, $66,043 remained available for application to postpetition services. The hourly rates of Wiley Rein's personnel are: Legal Support Personnel $150 - $305 Associates $305 - $520 Of Counsel, and Consultants $220 - $690 Partners $530 - $920 To the best of the Debtor's knowledge, Wiley Rein is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Trache can be reached at: Dylan G. Trache, Esq. 7925 Jones Branch Drive, Suite 6200 McLean, VA 22102 Tel: (703) 905-2800 Fax: (703) 905-2820 E-mail: dtrache@wileyrein.com About Volkswagen-Springfield Springfield, Virginia-based Volkswagen-Springfield, Inc., filed a Chapter 11 petition (Bankr. E.D. Va. Case No. 12-12905) in Alexandria on May 7, 2012. The Debtor operates one of the largest Volkswagen franchised dealerships in the Mid-Atlantic region. The Debtor estimated assets and debts of $10 million to $50 million as of the Chapter 11 filing. Judge Robert G. Mayer oversees the case. The Debtor is represented by Dylan G. Trache, Esq., and John T. Farnum, Esq., at Wiley Rein LLP, in McLean, Virginia. Pursuant to recent default notices, Branch Banking and Trust Company has asserted that it is owed $19.6 million. Jonathan L. Hauser, Esq., at Troutman Sanders LLP, represents BB&T. No creditors' committee has yet been appointed in the case. VOLKSWAGEN-SPRINGFIELD: Marcher OK'd as Financial Consultant ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Virginia, according to Volkswagen-Springfield, Inc.'s case docket, authorized the Debtor to employ Marcher Consultants, Inc., as its financial consultant. Marcher is expected to, among other things: -- analyze the Debtor's prepetition financial performance; -- prepare for and testify in Court regarding cash collateral issues and related matters; and -- assist the Debtor in complying with its administrative responsibilities, as preparing schedules and statements of financial affairs. The Debtor will compensate Marcher at the maximum rate of $250 per hour. Marcher received a retainer in the amount of $25,000. The retainer was paid by the Debtor through Wiley Rein LLP. As of the Petition Date, $9,025 of the retainer had been applied to prepetition services, leaving $15,975 available to apply towards postpetition services. To the best of the Debtor's knowledge, Marcher does not hold or represent any interest adverse to the estate of the Debtor. About Volkswagen-Springfield Springfield, Virginia-based Volkswagen-Springfield, Inc., filed a Chapter 11 petition (Bankr. E.D. Va. Case No. 12-12905) in Alexandria on May 7, 2012. The Debtor operates one of the largest Volkswagen franchised dealerships in the Mid-Atlantic region. The Debtor estimated assets and debts of $10 million to $50 million as of the Chapter 11 filing. Judge Robert G. Mayer oversees the case. The Debtor is represented by Dylan G. Trache, Esq., and John T. Farnum, Esq., at Wiley Rein LLP, in McLean, Virginia. Pursuant to recent default notices, Branch Banking and Trust Company has asserted that it is owed $19.6 million. Jonathan L. Hauser, Esq., at Troutman Sanders LLP, represents BB&T. No creditors' committee has yet been appointed in the case. WAGSTAFF MINNESOTA: Has Until Oct. 30 to Propose Ch. 11 Plan ------------------------------------------------------------ The Hon. Nancy C. Dreher of the U.S. Bankruptcy Court for the District of Minnesota extended Wagstaff Minnesota, Inc., et al.'s exclusive periods to file and solicit acceptances for a proposed Chapter 11 plan until Oct. 30, 2012, and Dec. 30, respectively. The Debtors explained that they will commence a consensual sale process of their restaurants and related property as contemplated pursuant to the terms of the settlement agreement with KFC Corporation. Thereafter, the Debtors will be in a position to determine the best exit strategy from the chapter 11 cases, including evaluating the necessity of filing a plan of reorganization. Settlement Agreement The Debtors and KFCC reached an agreement in principle memorialized in a settlement agreement. Pursuant to the Settlement Agreement (i) the Debtors and the GE Parties (General Electric Capital Corporation, a Delaware corporation, General Electric Capital Business Asset Funding Corporation of Connecticut, a Delaware corporation, GE Capital Franchise Finance Corporation, and Colonial Pacific Leasing Corporation) will agree to dismiss their appeals to the Eighth Circuit, and (ii) KFCC will agree to forbear from enforcing the District Court Order and to issue limited franchise licenses to enable the Debtors to pursue sales of the restaurants. The settlement agreement will resolve extensive litigation and will allow the Debtors to proceed unobstructed towards the sale of substantially all of their assets, which the Debtors have determined is the best way to maximize the value of their estates. About Wagstaff Properties Hanford, California-based Wagstaff Properties LLC and its debtor- affiliates filed for Chapter 11 protection (Bankr. D. Minn. Case No. 11-43074) on April 30, 2011. The cases are jointly administered with Wagstaff Minnesota, Inc. (Case No. 11-43073). Bankruptcy Judge Nancy C. Dreher presides over the cases. Fredrikson & Byron, PA, and Peitzman Weg & Kempinsky LLP, represent the Debtors in their restructuring efforts. Alvarez & Marsal North America LLC serves as the Debtors' financial advisor. Trinity Capital, LLC and its affiliated broker-dealer, BWK Trinity Capital Securities LLC, serve as the Debtors' investment banker with respect to a sale of their assets. Epiq Bankruptcy Solutions LLC provides administrative, noticing and balloting services. Wagstaff Properties estimated assets and liabilities at $10 million to $50 million. On June 8, 2011, the U.S. Trustee appointed three member to the Official Committee of Unsecured Creditors in the Debtors' cases. Freeborn & Peters LLP and Lommen, Abdo, Cole, King & Stageberg P.A. serve as the Committee's counsel. WARNER SPRINGS: Opposes Pala Tribe's Chapter 7 Conversion Bid ------------------------------------------------------------- Warner Springs Ranchowners Association, dba Warner Springs Ranch, filed an opposition to the request of the Pala Band of Mission Indians to convert the bankruptcy case to Chapter 7 or, in the alternative, to appoint a Chapter 11 trustee. The Debtor claims that Pala's allegations are combination of biased, incorrect, misplaced and exaggerated statements. According to the Debtor, it has been in chapter 11 barely four months and, contrary to Pala's allegations, has been moving diligently forward to sell its valuable co-owned property consisting of more than 2,300 acres of unencumbered rural land. The Debtor explains the bankruptcy was filed to facilitate a sale of the co-owned property. Despite best efforts, and despite being under contract with Pala for over two years, the Debtor was not able to sell its co-owned property and close escrow pre-petition due, in part, to Pala's failure to cooperate with resolution of several contractual issues. The Debtor believes Pala's motivation in seeking conversion is simply to chill the market value of the property and potential interest from third parties in the hope that Pala will be able to acquire the property for something less than the pre-petition contract price. The Debtor says the appointment of a chapter 11 trustee at this juncture would add substantial administrative expenses to the case. About Warner Springs Ranch Warner Springs Ranchowners Association, a California non-profit mutual benefit corporation, filed for Chapter 11 protection (Bankr. S.D. Calif. Case No. 12-03031) on March 1, 2012. Judge Louise DeCarl Adler presides over the case. Daniel Silva, Esq., and Jeffrey D. Cawdrey, Esq., at Gordon & Rees LLP, represent the Debtor. The Debtor's schedules disclosed $14,079,894 in assets and $1,466,076 in liabilities as of the Chapter 11 filing. Warner Springs Ranchowners Association manages and co-owns 2,300 acres of unencumbered rural land known as the Warner Springs Ranch in San Diego County, California. The property has a 150-acre golf course, natural hot springs, 250 cottage style hotel rooms, tennis courts, swimming pools and a private airport. The Debtor co-owns the property with over 1,200 other individuals and entities. The Debtor has 54% of the undivided tenancy-in-common fee interests in the property. WARNER SPRINGS: Court OKs CBRE Inc. as Real Estate Broker --------------------------------------------------------- Warner Springs Ranchowners Association, dba Warner Springs Ranch, sought and obtained approval from the U.S. Bankruptcy Court to employ CBRE, Inc. and Jeff Woolson as real estate broker. CBRE will market and assist with the Debtor's sale of the ranch. Jeff Woolson attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. CBRE will be paid on a commission basis -- equal to 4% of the first $10,000,000 of the sale price and 2.5% of all amounts in excess of $10,000,000. CBRE will bear all costs of marketing the property unless the employment agreement is terminated by Debtor. If the agreement is terminated, the Debtor will reimburse CBRE for up to $5,000 in out-of-pocket expenses incurred by CBRE while marketing the Ranch. CBRE's compensation is subject to review and approval by the Court in accordance with the applicable provisions of the Bankruptcy Code. About Warner Springs Ranch Warner Springs Ranchowners Association, a California non-profit mutual benefit corporation, filed for Chapter 11 protection (Bankr. S.D. Calif. Case No. 12-03031) on March 1, 2012. Judge Louise DeCarl Adler presides over the case. Daniel Silva, Esq., and Jeffrey D. Cawdrey, Esq., at Gordon & Rees LLP, represent the Debtor. The Debtor's schedules disclosed $14,079,894 in assets and $1,466,076 in liabilities as of the Chapter 11 filing. Warner Springs Ranchowners Association manages and co-owns 2,300 acres of unencumbered rural land known as the Warner Springs Ranch in San Diego County, California. The property has a 150-acre golf course, natural hot springs, 250 cottage style hotel rooms, tennis courts, swimming pools and a private airport. The Debtor co-owns the property with over 1,200 other individuals and entities. The Debtor has 54% of the undivided tenancy-in-common fee interests in the property. WARNER SPRINGS: Court OKs OFKMJ Corbin as Accountants ----------------------------------------------------- Warner Springs Ranchowners Association, dba Warner Springs Ranch, sought and obtained permission to employ OFKMJ Corbin & Company as accountants and auditors. Warner Springs Ranchowners Association, a California non-profit mutual benefit corporation, filed for Chapter 11 protection (Bankr. S.D. Calif. Case No. 12-03031) on March 1, 2012. Judge Louise DeCarl Adler presides over the case. Daniel Silva, Esq., and Jeffrey D. Cawdrey, Esq., at Gordon & Rees LLP, represent the Debtor. The Debtor's schedules disclosed $14,079,894 in assets and $1,466,076 in liabilities as of the Chapter 11 filing. Warner Springs Ranchowners Association manages and co-owns 2,300 acres of unencumbered rural land known as the Warner Springs Ranch in San Diego County, California. The property has a 150-acre golf course, natural hot springs, 250 cottage style hotel rooms, tennis courts, swimming pools and a private airport. The Debtor co-owns the property with over 1,200 other individuals and entities. The Debtor has 54% of the undivided tenancy-in-common fee interests in the property. WASHINGTON MUTUAL: Liquidating Trust to Distribute $74 Million -------------------------------------------------------------- WMI Liquidating Trust, formed pursuant to the recently confirmed and consummated Seventh Amended Joint Plan of Affiliated Debtors under Chapter 11 of the United States Bankruptcy Code of Washington Mutual, Inc. will make a distribution of approximately $74 million to beneficiaries of the Liquidating Trust in a manner consistent with the terms of the Plan. In accordance with the priority of payments described on Exhibit H to the Plan, the Distribution will be allocated to claimants in "Tranche 2" in the following amounts: $15 million to holders of Allowed Senior Notes Claims; $56 million to holders of Allowed Senior Subordinated Notes Claims; and $3 million to holders of Allowed General Unsecured Claims. The Distribution will be initiated by the Liquidating Trust on Wednesday, Aug. 1, 2012. More detail associated with this Distribution will be reflected on the next Quarterly Summary Report (the "QSR") to be filed by the Liquidating Trust with the United States Bankruptcy Court for the District of Delaware for the period ending on June 30, 2012 (which QSR is expected to be filed on or about July 30, 2012). The Distribution is possible primarily as a result of recent favorable decisions by the Bankruptcy Court permitting the release of a claim reserve of approximately $22 million that had been established in conjunction with various disputed claims, as well as a release of approximately $52 million for amounts previously reserved to pay professional fees. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- was the holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns 100% of the equity in WMI Investment. When WaMu filed for protection from its creditors, it disclosed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment estimated assets of $500 million to $1 billion with zero debts. WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal & Manges LLP in New York City; Mark D. Collins, Esq., at Richards, Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari, Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver & Hedges, LLP. The Debtor tapped Valuation Research Corporation as valuation service provider for certain assets. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New York, and David B. Stratton, Esq., at Pepper Hamilton LLP in Wilmington, Del., represent the Official Committee of Unsecured Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the Equity Committee. The official committee of equity security holders also tapped BDO USA as its tax advisor. Stacey R. Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which acquired the WaMu bank unit's assets prior to the Petition Date. In March 2012, the Debtors' Seventh Amended Joint Plan of Affiliated, as modified, and as confirmed by order, dated Feb. 23, 2012, became effective, marking the successful completion of the chapter 11 restructuring process. The Plan is based on a global settlement that removed opposition to the reorganization and remedy defects the judge identified in September. The plan is designed to distribute $7 billion. Under the reorganization plan, WaMu established a liquidating trust to make distributions to parties-in-interest on account of their allowed claims. WHITE BEAUTY: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: White Beauty Development, LLC 517 N. Foothill Road Beverly Hills, CA 90210 Bankruptcy Case No.: 12-18828 Chapter 11 Petition Date: July 27, 2012 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: Craig G. Margulies, Esq. THE MARGULIES LAW FIRM, APLC. 16030 Ventura Blvd. Suite 470 Encino, CA 91436 Tel: (818) 705-2777 Fax: (818) 705-3777 E-mail: cmargulies@margulies-law.com Scheduled Assets: $4,094,659 Scheduled Liabilities: $3,154,928 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/nvb12-18828.pdf The petition was signed by Eyal Gamliel, managing member of Biel Investments, LLC, Debtor's operating manager and manager. W.R. GRACE: Chapter 11 Emergence to Depend on Waiver Satisfaction ----------------------------------------------------------------- On April 2, 2001, Grace and 61 of its United States subsidiaries and affiliates, including its primary U.S. operating subsidiary, W. R. Grace & Co.-Conn., filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware in order to resolve Grace's asbestos-related liabilities. On Jan. 31, 2011, the Bankruptcy Court issued an order confirming Grace's Joint Plan of Reorganization. On Jan. 31, 2012, the United Stated District Court issued an order affirming the Plan, which was reaffirmed on June 11, 2012 following a motion for reconsideration. Eight parties filed notices of appeal with the Third Circuit Court of Appeals before the July 11, 2012 deadline. On June 5, 2012, the Bankruptcy Court approved agreements among Grace, co-proponents of the Plan, BNSF railroad, several insurance companies and the representatives of Libby asbestos personal injury claimants, to settle certain objections to the Plan. In connection with this settlement, the company agreed to pay $19.5 million to transfer the Libby Medical Program to an independent entity in Montana. Pursuant to the agreements, the Libby claimants and BNSF will withdraw their appeals to the Plan when these settlements become effective. The timing of Grace's emergence from Chapter 11 will depend on the satisfaction or waiver of the remaining conditions set forth in the Plan. Grace and its co-proponents are evaluating the appeals to the Plan and whether Grace will emerge from Chapter 11 prior to the resolution of such appeals. The Plan sets forth how all pre-petition claims and demands against Grace will be resolved. See Grace's most recent periodic reports filed with the SEC for a detailed description of the Plan. About W.R. Grace Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) - - http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan and Disclosure Statement. The hearing to consider the adequacy of the Debtors' Disclosure Statement began on Jan. 21, 2005. The Debtors' exclusive period to file a chapter 11 plan expired on July 23, 2007. Estimation of W.R. Grace's asbestos personal injury liabilities commenced on Jan. 14, 2008. W.R. GRACE: Net Income Drops 8.6% to $69.3 Million -------------------------------------------------- W. R. Grace & Co. disclosed second quarter net income of $69.3 million, or $0.90 per diluted share. Net income for the prior-year quarter was $75.8 million, or $1.00 per diluted share. Adjusted EPS of $1.14 per diluted share increased 2.7 percent from $1.11 per diluted share for the prior-year quarter. Net income for the six months ended June 30, 2012, was $130.2 million, or $1.70 per diluted share, compared with $130.0 million, or $1.72 per diluted share for the prior-year period. Adjusted EPS of $2.02 per diluted share increased 7.4 percent from $1.88 per diluted share for the prior-year period. A full text copy of the press release announcing the second quarter results is available free at http://is.gd/Tb5ZZi About W.R. Grace Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) - - http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan and Disclosure Statement. The hearing to consider the adequacy of the Debtors' Disclosure Statement began on Jan. 21, 2005. The Debtors' exclusive period to file a chapter 11 plan expired on July 23, 2007. Estimation of W.R. Grace's asbestos personal injury liabilities commenced on Jan. 14, 2008. YUKOS OIL: Tribunal Orders Russian Government to Pay Investors -------------------------------------------------------------- An international tribunal ordered the Russian government to compensate a group of Spanish investors for the losses they suffered when Russia seized the Yukos Oil Company, one of the largest oil and gas companies in the world. The Spanish investors sought compensation under the bilateral investment treaty between Spain and the Russian Federation. The panel ruled that the Russian government issued illegitimate tax bills and, through a series of enforcement actions and eventual bankruptcy, placed Yukos' assets under state control. State-owned Rosneft and Gazprom received the vast majority of Yukos' assets. The tribunal valued Yukos at more than $60 billion at the time the company was nationalized. "This case stands for an important principle: If Russia violates its treaty obligations and harms investors, there will be consequences," said Marney Cheek, a partner at Covington & Burling LLP who represents the Spanish investors. "The panel's decision holds Russia accountable and awards compensation to the former shareholders of Yukos." The tribunal concluded "that Yukos' tax delinquency was indeed a pretext for seizing Yukos assets and transferring them to Rosneft. . . [T]his finding supports the Claimants' contention that the Russian Federation's real goal was to expropriate Yukos, and not to legitimately collect taxes." "This ruling vindicates the rights of Spanish investors, and, indeed, all investors in Yukos," said Ms. Cheek. Thousands of investors worldwide owned shares in Yukos. This is the second ruling by an international tribunal holding that these investors are entitled to compensation. An investor from the United Kingdom prevailed in a similar proceeding in September 2010. The arbitration proceeding, Quasar de Valores SICAV S.A., et al. v. The Russian Federation, was filed in March 2007 under the jurisdiction of the Stockholm Chamber of Commerce. A tribunal of three distinguished jurists issued a unanimous award: Jan Paulsson (chair) of Freshfields Bruckhaus Deringer; Toby Landau QC, of Essex Chambers; and Judge Charles Brower of the Iran-United States Claims Tribunal. Covington & Burling LLP and Spanish firm Cuatrecasas, Goncalves Pereira represented Claimants. About Yukos Oil Headquartered in Moscow, Yukos Oil -- http://yukos.com/-- was an open joint stock company under the laws of the Russian Federation. Yukos was involved in energy industry substantially through its ownership of its various subsidiaries, which own or are otherwise entitled to enjoy certain rights to oil and gas production, refining and marketing assets. The Company filed for Chapter 11 protection on Dec. 14, 2004 (Bankr. S.D. Tex. Case No. 04-47742), but the case was dismissed on Feb. 24, 2005, by the Hon. Letitia Z. Clark. A few days later, the Russian Government sold its main production unit Yugansk to a little-known firm Baikalfinansgroup for US$9.35 billion, as payment for US$27.5 billion in tax arrears for 2000-2003. Yugansk eventually was bought by state-owned Rosneft, which is now claiming more than US$12 billion from Yukos. On March 10, 2006, a 14-bank consortium led by Societe Generale filed a bankruptcy suit in the Moscow Arbitration Court in an attempt to recover the remainder of a US$1 billion debt under outstanding loan agreements. The banks, however, sold the claim to Rosneft, prompting the Court to replace them with the state- owned oil company as plaintiff. On April 13, 2006, court-appointed external manager Eduard Rebgun filed a chapter 15 petition in the U.S. Bankruptcy Court for the Southern District of New York (Bankr. S.D.N.Y. Case No. 06-0775), in an attempt to halt the sale of Yukos' 53.7% ownership interest in Lithuanian AB Mazeikiu Nafta. On May 26, 2006, Yukos signed a US$1.49 billion Share Sale and Purchase Agreement with PKN Orlen S.A., Poland's largest oil refiner, for its Mazeikiu ownership stake. The move was made a day after the Manhattan Court lifted an order barring Yukos from selling its controlling stake in the Lithuanian oil refinery. On Aug. 1, 2006, the Hon. Pavel Markov of the Moscow Arbitration Court upheld creditors' vote to liquidate OAO Yukos Oil Co. and declared what was once Russia's biggest oil firm bankrupt. On Nov. 23, 2007, the Russian Trading System and Moscow Interbank Currency Exchange stopped trading Yukos shares after the company formally ceased to exist. Mr. Rebgun completed the company's liquidation process after Russia's Federal Tax Service has entered Yukos' liquidation on the Uniform State Register of Legal Entities. As reported in the Troubled Company Reporter-Europe on Nov. 14, 2007, the Moscow Arbitration Court entered an order closing the liquidation proceedings of Yukos, 15 months after it was declared bankrupt on Aug. 1, 2006. ZALE CORP: Secures $665 Million Credit Facility ----------------------------------------------- Zale Corporation has secured a new $665 million credit facility, which includes an amended and extended $650 million Revolving Credit Facility and a new $15 million First-In, Last-Out (FILO) Credit Facility. The company also announced that it utilized increased availability from these facilities to fund a prepayment of $60.5 million on its Senior Secured Term Loan. In addition, Zale amended and extended its Senior Secured Term Loan with Golden Gate Capital for the remaining $80 million. Overview of the Amended and Extended Revolving Credit Facility * Facility size of $650 million * Matures in five years, an increase of about three years from the prior agreement * Priced at LIBOR plus 175 to 225 basis points based on the Company's average availability, an improvement of 175 basis points from the prior agreement * Enhanced borrowing capacity by increasing the inventory collateral base by 2.5 percent to 90 percent Overview of New FILO Credit Facility * Facility size of $15 million * Matures in five years * Priced at LIBOR plus 350 to 400 basis points based on the Company's average availability * Further enhanced borrowing capacity by increasing inventory collateral base up to an additional 2.5 percent Overview of Amended and Extended Senior Secured Term Loan * Utilized increased availability from the $665 million credit facility to fund a prepayment of $60.5 million on the term loan * Amended and extended the Senior Secured Term Loan agreement for remaining $80 million * Matures in five years, an increase of about two years from prior agreement * Fixed interest of 11 percent per annum, payable quarterly in cash, a reduction from 15 percent per annum in the prior agreement * Eliminated store contribution covenants and improved minimum liquidity requirement yielding approximately $50 million of additional availability * Non-callable in year one, optional redemption with call premium of 4 percent in year two, 3 percent in year three and 2 percent in year four The new $665 million credit facility was led by Bank of America, administrative agent, and Wells Fargo Bank and J.P. Morgan Securities, co-syndication agents. Peter J. Solomon Company acted as financial advisor for the company. At current interest rates, these transactions reduce the Company's overall average borrowing cost from about eight percent to about four percent, resulting in projected annual pretax savings in the fiscal year commencing Aug. 1, 2012, of approximately $17 million. As a result of the financing transactions, overall available liquidity has improved and is expected to stand at approximately $140 million on July 31, 2012. Zale incurred costs of approximately $13 million related to the financing transactions, of which approximately $5 million will be expensed in the fourth fiscal quarter of 2012, with the remaining costs to be amortized over the five year life of the agreements. "The benefits gained from the debt refinancing are a result of the significant operating improvements that the company has achieved over the past two years," commented Theo Killion, Chief Executive Officer. "Going forward, our aggregate borrowing cost will be substantially lower, which will accelerate the company?s return to profitability." About Zale Corporation Based in Dallas, Texas, Zale Corporation (NYSE: ZLC) -- http://www.zalecorp.com/-- is a specialty retailer of diamonds and other jewelry products in North America, operating approximately 1,900 retail locations throughout the United States, Canada and Puerto Rico, as well as online. Zale Corporation's brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale also operates online at http://www.zales.com/, http://www.zalesoutlet.com/, http://www.gordonsjewelers.com/and http://www.pagoda.com/ The Company reported a net loss of $7.56 million on $1.45 billion of revenue for the nine months ended April 30, 2012, compared with a net loss of $79.66 million on $1.36 billion of revenue for the same period during the prior year. The Company's balance sheet at April 30, 2012, showed $1.22 billion in total assets, $1.01 billion in total liabilities and $202.13 million in stockholders' investment. * One Exchange Appoints Ken Freda as Chief Operating Officer ------------------------------------------------------------- One Exchange Street, Inc. disclosed that Ken Freda has been selected as the company's Chief Operating Officer. Freda will be responsible for all business processes related to One Exchange Street's proprietary trading platform, cultivating and managing the company's relationships with select claims and noticing agents, as well as marketing the company to bankruptcy practitioners, including, law firms and bankruptcy court personnel. Freda will be based in New York City and report directly to Todd Zoha, Co-Founder and CEO of One Exchange Street. Freda brings over 30 years of bankruptcy experience to the One Exchange Street management team. He was previously a Managing Director with Executive Sounding Board Associates. Prior to joining Executive Sounding Board, Freda spent nine years as Director of Bankruptcy Operations and Business Development at The Garden City Group, a leading claims and noticing agent. Prior to Garden City Group, Freda spent over 12 years working for the U.S. Bankruptcy Court for the Southern District of New York (Manhattan and White Plains Divisions), and 10 years working for the Office of the United States Trustee for the Southern District of New York in its Manhattan office. "Given Ken's unique background, his expert knowledge of the U.S. Bankruptcy Code coupled with his extensive operational experience and professional network, we quickly recognized that Ken was the right person to join the One Exchange Street team as Chief Operating Officer," says Zoha. "I am thrilled to join the One Exchange Street team," said Freda. "I look forward to building One Exchange Street's trading platform into the premier platform for online trading in bankruptcy claims," said Freda. In response to member feedback, One Exchange Street has significantly enhanced the functionality of its trading platform. Buyers can now select the debtors they are interested in following and receive an email notification if, and when, a claim is listed for sale by those debtors. Similarly, sellers can now decide to receive an email notification if, and when, a bid is entered for their claim in excess of a specified dollar amount. The enhanced functionality will provide members with the option to monitor investment opportunities in real-time on One Exchange Street's trading platform without the need to be logged in to the trading platform. About One Exchange Street One Exchange Street, Inc. --http://www.oneexchangestreet.com/-- is a proprietary online trading platform for bankruptcy claims. The company, headquartered in Columbus, Ohio, was co-founded by Todd Zoha and Sean O'Riordan, both former AlixPartners restructuring professionals. The platform creates a liquid and transparent online marketplace that provides price discovery and real-time trade execution via standardized claim transfer agreements to buyers and sellers of bankruptcy claims. * Large Companies With Insolvent Balance Sheet ---------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- ABSOLUTE SOFTWRE ABT CN 127.2 (3.2) 14.0 ACCO BRANDS CORP ACCO US 1,044.9 (68.3) 311.8 ADVANCED BIOMEDI ABMT US 0.2 (1.9) (1.5) AK STEEL HLDG AKS US 3,901.0 (360.6) 129.6 AMC NETWORKS-A AMCX US 2,125.8 (1,004.9) 506.4 AMER AXLE & MFG AXL US 2,441.2 (394.7) 169.7 AMERISTAR CASINO ASCA US 2,026.3 (45.8) (13.5) ARRAY BIOPHARMA ARRY US 120.0 (78.8) 28.4 ATLATSA RESOURCE ATL SJ 920.8 (233.7) 20.0 AUTOZONE INC AZO US 6,148.9 (1,416.8) (623.1) BOSTON PIZZA R-U BPF-U CN 166.1 (91.7) (1.5) CABLEVISION SY-A CVC US 7,088.5 (5,609.6) (218.0) CAPMARK FINANCIA CPMK US 20,085.1 (933.1) - CARMIKE CINEMAS CKEC US 420.8 (1.9) (26.1) CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) CHENIERE ENERGY CQP US 1,762.3 (574.9) 31.7 CHOICE HOTELS CHH US 857.7 (11.2) 402.1 CIENA CORP CIEN US 1,928.6 (41.1) 924.4 CINCINNATI BELL CBB US 2,657.9 (701.3) (42.6) CLOROX CO CLX US 4,386.0 (106.0) (689.0) DEAN FOODS CO DF US 5,758.6 (52.7) 296.0 DELTA AIR LI DAL US 44,720.0 (1,135.0) (6,236.0) DENNY'S CORP DENN US 336.2 (2.6) (16.3) DIRECTV-A DTV US 21,912.0 (3,377.0) 1,210.0 DISH NETWORK-A DISH US 12,409.5 (55.6) 778.4 DISH NETWORK-A EOT GR 12,409.5 (55.6) 778.4 DOMINO'S PIZZA DPZ US 424.6 (1,369.1) 52.9 DUN & BRADSTREET DNB US 1,903.8 (628.3) (261.0) E2OPEN INC EOPN US 29.7 (34.5) (32.5) EDGEN GROUP INC EDG US 555.6 (154.7) 267.4 FAIRPOINT COMMUN FRP US 1,929.1 (149.8) 38.1 FIESTA RESTAURAN FRGI US 364.8 (3.2) (9.0) FIFTH & PACIFIC FNP US 900.5 (175.5) 130.9 FREESCALE SEMICO FSL US 3,499.0 (4,498.0) 1,374.0 GENCORP INC GY US 874.0 (171.3) 47.3 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GOLD RESERVE INC GRZ US 78.3 (25.8) 56.9 GOLD RESERVE INC GRZ CN 78.3 (25.8) 56.9 GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5 HCA HOLDINGS INC HCA US 27,139.0 (7,324.0) 1,667.0 HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8) HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8) INCYTE CORP INCY US 293.6 (248.9) 133.9 IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2 JUST ENERGY GROU JE CN 1,543.0 (527.2) (481.0) JUST ENERGY GROU JE US 1,543.0 (527.2) (481.0) LIMITED BRANDS LTD US 6,616.0 (131.0) 1,526.0 LIN TV CORP-CL A TVL US 804.7 (75.7) 47.4 LORILLARD INC LO US 2,576.0 (1,568.0) 881.0 MARRIOTT INTL-A MAR US 6,007.0 (1,124.0) (1,287.0) MERITOR INC MTOR US 2,565.0 (945.0) 193.0 MERRIMACK PHARMA MACK US 64.4 (43.6) 21.0 MONEYGRAM INTERN MGI US 5,185.1 (116.1) (35.3) MORGANS HOTEL GR MHGC US 544.3 (97.8) (8.6) MPG OFFICE TRUST MPG US 2,061.5 (827.9) - NATIONAL CINEMED NCMI US 788.5 (347.4) 102.6 NAVISTAR INTL NAV US 11,384.0 (407.0) 1,658.0 NB MANUFACTURING NBMF US - (0.0) (0.0) NEXSTAR BROADC-A NXST US 578.2 (179.9) 34.5 NOVADAQ TECHNOLO NDQ CN 23.5 (3.9) 7.5 NPS PHARM INC NPSP US 183.3 (54.4) 130.0 NYMOX PHARMACEUT NYMX US 6.4 (5.2) 2.9 ODYSSEY MARINE OMEX US 21.9 (14.2) (13.9) OMEROS CORP OMER US 21.1 (12.7) 1.0 PALM INC PALM US 1,007.2 (6.2) 141.7 PDL BIOPHARMA IN PDLI US 235.0 (243.8) 56.6 PEER REVIEW MEDI PRVW US 1.4 (3.4) (3.8) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PRIMEDIA INC PRM US 208.0 (91.7) 3.6 PROOFPOINT INC PFPT US 64.7 (29.1) (33.7) PROTECTION ONE PONE US 562.9 (61.8) (7.6) QUALITY DISTRIBU QLTY US 330.8 (67.6) 54.5 REGAL ENTERTAI-A RGC US 2,307.0 (552.6) 46.5 RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) REVLON INC-A REV US 1,156.7 (679.6) 184.9 REXNORD CORP RXN US 3,290.9 (80.8) 551.0 RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 SALLY BEAUTY HOL SBH US 1,789.9 (69.2) 478.8 SINCLAIR BROAD-A SBGI US 1,771.2 (87.2) 3.9 TAUBMAN CENTERS TCO US 3,096.1 (295.3) - TEMPUR-PEDIC INT TPX US 865.5 (12.1) 258.9 THERAPEUTICS MD TXMD US 1.5 (3.4) (1.3) THRESHOLD PHARMA THLD US 89.7 (77.4) 72.8 UNISYS CORP UIS US 2,397.9 (1,190.0) 463.1 VECTOR GROUP LTD VGR US 886.1 (132.7) 145.6 VERISIGN INC VRSN US 1,942.0 (59.2) 858.0 VERISK ANALYTI-A VRSK US 1,892.0 (10.3) (147.7) VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) WEIGHT WATCHERS WTW US 1,176.1 (1,856.8) (1,057.9) ********* 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 ***