/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/120928.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, September 28, 2012, Vol. 16, No. 270 Headlines 1617 WESTCLIFF: Chapter 11 Status Hearing on Wednesday 1220 SOUTH OCEAN: Seeks Court Okay to Hire Rappaport as Counsel 1220 SOUTH OCEAN: Initial Status Conference on Oct. 4 1555 WABASH: Has Access to Cash Collateral Until Sept. 30 1701 COMMERCE: Seeks Judge OK on $55 Million Hotel Sale ABDIANA A LLC: Files for Chapter 11 in Kansas City ADVANCED COMPUTER: Seeks to Use Banco Bilbao Cash Collateral AIRBORNE ACQUISITION: Moody's Assigns 'B2' Corp. Family Rating ALLEN FAMILY: Plan Filing Deadline Extended to Nov. 29 ALT HOTEL: Fails to Advance Claim Over Discounted Sale of Debt AMERICAN AIRLINES: Senior Pilots Seek Stay on Appeal ARCAPITA BANK: Aims to Finalize Sharia Financing from Silver Point ARCAPITA BANK: Seeks Final Exclusive Extension; Plan Near ARCAPITA BANK: Asks Court's OK for $150-Mil DIP Financing AS SEEN ON TV: Receives $1.3 Million from Sales of Securities ASHLAND UNIVERSITY: Moody's Extends Review on 'Ba3' Bond Rating ATLAS PIPELINE: Moody's Affirms B1 CFR; Raises Note Rating to B2 AUTO SPORTS: Receivers to Auction Off Assets BEALL CORPORATION: Case Summary & 20 Largest Unsecured Creditors BHFS I LLC: Can Access Cash Collateral of BofA Until Jan. 31 BHFS I LLC: BofA Objects to First Motion to Extend Exclusivity BIOFUEL ENERGY: Idling Minnesota Plant, Operating Nebraska Plant BION ENVIRONMENTAL: GHP Horwath Raises Going Concern Doubt BION ENVIRONMENTAL: Incurs $7.3 Million Net Loss in Fiscal 2012 BIRMINGHAM-JEFFERSON CIVIC: S&P Ups Rating on 2002C Bonds From 'B' BIRMINGHAM-JEFFERSON CIVIC: S&P Ups Rating on 2005A Bonds From 'B' BRAND ENERGY: S&P Affirms 'B' Corp. Credit Rating; Outlook Stable BRIER CREEK: Exclusive Plan Filing Period Extended to Dec. 4 CAREY LIMOUSINE: Files for Chapter 11 in Delaware CENTERPLATE INC: Moody's Assigns 'B3' Corp. Family Rating CGGVERITAS SERVICES: Moody's Reviews Ratings for Downgrade CHRYSLER LLC: Fiat Sues VEBA Trust Over Call Option CHRYSLER LLC: Old Creditors Ask 2nd Circ. to Revive Daimler Suit CHRYSLER LLC: 6th Circ. Nixes Most of Former Execs' Benefits Suit CIRCUS AND ELDORADO: Wants Exclusivity Extended to Jan. 14 CLAIRE'S STORES: Closes Offering of $625 Million Senior Notes CLIFFORD JOESEPH WOERNER: Court Denies Objection to Exemptions CONTEC HOLDINGS: Has Loan Approval; Prepack Plan Hearing on Oct. 4 CORMEDIX INC: Gets Extension to Regain Compliance CORDILLERA GOLF: Reaches Settlement With Lender and Members COTT CORP: S&P Lifts Corp. Credit Rating to 'B+' on Profitability CPI CORP: Unit to Sell Real Estate to Worldwide Ventures DCB FINANCIAL: Files Amendment No. 4 to Form S-1 Prospectus DIGITAL DOMAIN: Williams, Blaise Bid for Rights on "Tembo" Film DIGITAL DOMAIN: Brower Piven Starts Investors' Class Suit DIGITAL DOMAIN: Sale Order Presented for Judge's Signature DUNE ENERGY: Inks Employment Agreements with Two Executives ELPIDA MEMORY: Bondholders Fight for Court Liaison Appointment EMISPHERE TECHNOLOGIES: Defaults on $31.1MM Notes Due MHR Fund ESSAR STEEL: S&P Affirms 'CCC+' Corporate Credit Rating FENTURA FINANCIAL: Files Form 15, Halts Filing of Reports FIELD FAMILY: Files List of 20 Largest Unsecured Creditors FIELD FAMILY: Hiring Dilworth Paxson as Bankruptcy Counsel FIRST NIAGARA: Current Capital Position Cues Fitch to Cut Ratings FISHER ISLAND: Stipulates to Hogan Lovells as Bankruptcy Counsel FISHER ISLAND: Petitioning Creditors Ask Court to Dismiss Cases FTMI REAL ESTATE: Emeritus to Lead Auction; Shefaor Quits FTMI REAL ESTATE: U.S. Trustee Appoints Patient Care Ombudsman GENE CHARLES: Court OKs Mazur Kraemer as Local Counsel GHC NY CORP: Romanoff Company Files for Chapter 11 in Manhattan GLOBAL AVIATION: Seeks Court OK for CBA Amendment GOE LIMA: Clawback Lawsuit Against Lippincott Goes to Trial GRATON ECONOMIC: S&P Gives 'B' Issuer Credit Rating GRAY TELEVISION: Senior Notes Offering Increased to $300 Million HERITAGE CONSOLIDATED: Has Use to Cash Collateral Until Sept. 30 HOVNANIAN ENTERPRISES: Signs Underwriting Pact with J.P. Morgan IFINIX FUTURES: CFTC Wants Brokerage Banned From Trading IPREO HOLDINGS: S&P Affirms 'B' Corp. Credit Rating; Outlook Pos J T THOMPSON: Lawyer Won't Get Paid for Violating Disclosure Rules JOHN BECK: Files for Bankruptcy After $479-Million Fine LAUSELL INC: Amends Schedules of Assets and Liabilities LAUSELL INC: Hires Charles A. Cuprill as Attorney LEVEL 3 COMMUNICATIONS: S&P Rates $1.2 Billion Term Loan 'B+' LIFEPOINT HOSPITALS: Moody's Raises Corp. Family Rating to 'Ba2' LIQUIDMETAL TECHNOLOGIES: To Issue 30-Mil. Shares Under Plan LYB FINANCE: S&P Rates $300MM Sr. Unsecured Notes 'BB+' LYTHGOE PROPERTIES: Court Denies Bid to Amend Confirmed Plan MEDFORD VILLAGE: Files Schedules of Assets and Liabilities MEDFORD VILLAGE: Court OKs Maschmeyer Karalis as Attorney MEDIA GENERAL: Issues 4.6 Million Class A Shares to Berkshire MICHAELS STORES: Inks $200MM Purchase Pact with Deutsche, et al. MOTORSPORT RANCH: Section 341(a) Meeting Scheduled for Oct. 2 MOTORSPORT RANCH: Can Employ J. Craig Cowgill as Counsel MSR RESORT: Wins Court Approval for $1.5BB Stalking Horse Deal MUNDY RANCH: Files Schedules of Assets and Liabilities MUNDY RANCH: Court Approves George Dave Giddens as Attorney NALLS DEVELOPMENT: Can Employ Richard Rosenbltt as Counsel NECKERMANN.DE GMBH: To Close Down in Line With Insolvency Law NORTHERN MARIANA: Moody's Confirms 'B2' Rating on G.O. Bonds NORTHERN PLAINS: Placed Into Liquidation in South Dakota PDC ENERGY: Moody's Assigns 'B3' Rating to Sr. Unsecured Notes PDC ENERGY: S&P Gives 'B-' Rating on $400MM Sr. Unsecured Notes PLAINS EXPLORATION: S&P Rates $5-Bil. Credit Facilities 'BB' PORTER BANCORP: John Davis Named Chief Credit Officer of PBI Bank PTC ALLIANCE: S&P Gives 'B' Corp. Credit Rating; Outlook Stable QUINCY MEDICAL: Buyer Liable to Severance Claims RADIOSHACK CORP: James Gooch to Step Down as CEO RANCHO HOUSING: Exclusive Plan Filing Period Extended to Nov. 27 RG STEEL: Asks Court to Preserve Critical Access to Cash RITZ CAMERA: Boater's World Mark Sold for $140,000 ROCK POINTE: Court OKs Ken Gates as Committee Attorney ROCKLIN ACADEMIES: S&P Affirms 'BB+' Rating on 2 Bond Series RYERSON HOLDING: S&P Affirms 'B-' Corporate Credit Rating RYERSON INC: Moody's Rates $600-Mil. Sr. Secured Notes 'Caa2' SAVERS INC: Moody's Assigns 'Ba3' Rating to $790MM Secured Loans SENECA GAMING: Panel Appointment No Impact on Moody's Ratings SIERRA NEGRA: Files Schedules of Assets and Liabilities SIERRA NEGRA: Taps Gordon Silver as Bankruptcy Counsel SOLYNDRA LLC: Given OK to Auction Fremont Plant for at Least $90MM SOUTH LAKES DAIRY: Sec. 341 Creditors' Meeting Set for Oct. 2 SOUTH LAKES DAIRY: U.S. Trustee Appoints 5-Member Creditors' Panel STANADYNE CORP: UTC Executive Named Chief Operating Officer SUSAN BENSON: Court Confirms Funeral Parlor's Amended Plan TEXAS RANGERS: Raine Advisors Granted $2.5 Million in Fees TRI-VALLEY: Opus Equity Panel Opposes New Loan TRITON CONTAINER: S&P Says 'BB+' CCR Reflects Stable Earnings TRIZETTO GROUP: Moody's Cuts CFR to 'B2'; Rates Term Loan 'Caa1' UNIGENE LABORATORIES: Gets $4MM Loan, Waivers from Victory Park UNIVAR INC: Moody's Affirms 'B2' CFR/PDR; Outlook Stable UROLOGIX INC: Had $4.7-Mil. Net Loss in Fiscal Year Ended June 30 VHGI HOLDINGS: Michael Fasci Appointed Chief Financial Officer VHGI HOLDINGS: Issues $2.5MM Notes to CEO, Largest Stockholder VIKING SYSTEMS: Three Directors Resign from Board VITAMIN SHOPPE: S&P Raises CCR to 'BB' on Sustained Improvement VITRO SAB: Claims Bondholders Revealed Restructuring Secrets WALL STREET SYSTEMS: Moody's Rates New Secured 2nd Lien Debt Caa1 WALL STREET SYSTEMS: S&P Affirms 'B' Corp. Credit Rating * Moody's Says Number of Lower-Rated Cos. Unchanged Since May * North-Am Telco High-Yield Bonds Offer Above Average Protection * Judge Edith Jones Stepping Down as Fifth Circuit Chief Judge * Hunton & Williams Gets Turnaround Management Award * BOOK REVIEW: Performance Evaluation of Hedge Funds ********* 1617 WESTCLIFF: Chapter 11 Status Hearing on Wednesday ------------------------------------------------------ The Bankruptcy Court will hold a Status Conference hearing in the Chapter 11 case of 1617 Westcliff, LLC, on Oct. 3, 2012, at 9:00 a.m. in Courtroom 6C located at 411 West Fourth Street, in Santa Ana. 1617 Westcliff, LLC, filed a bare-bones Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-19326) on Aug. 2, 2012 in Santa Ana. The Debtor estimated assets of $10 million to $50 million and liabilities of $1 million to $10 million. Gary Rettig, president of Rettig Portfolio, Inc., signed the Chapter 11 petition. Bankruptcy Judge Mark S. Wallace oversees the case. D. Edward Hays, Esq., at Marshack Hays LLP, serves as the Debtor's counsel. 1220 SOUTH OCEAN: Seeks Court Okay to Hire Rappaport as Counsel --------------------------------------------------------------- 1220 South Ocean Boulevard LLC, seeks formal Court approval of Kenneth S. Rappaport, Esq., and the law firm of Rappaport Osborne & Rappaport, PL to represent the Debtor in the case, nunc pro tunc to Sept. 21. The Debtor will look to Rappaport to, among other things, represent the Debtor in negotiation with its creditors in the preparation of a plan. Mr. Rappaport, Esq., attests that his firm is disinterested as required by 11 U.S.C. Sec. 327(a). About 1220 South Ocean Boulevard 1220 South Ocean Boulevard, LLC, filed a bare-bones Chapter 11 petition (Bankr. S.D. Fla. Case No. 12-32609) in its home-town in West Palm Beach, Florida. The Debtor disclosed $74 million in total assets and $41.5 million in liabilities as of Sept. 7, 2012. According to http://1220southocean.com/,1220 South Ocean is a French-inspired waterfront estate homes and resort located in Palm Beach. Owned by real estate developer Dan Swanson, president of Addison Development, 1220 South Ocean sits on 2.5 private and secure acres of land, has 20,000 square feet of living plus an additional 7,000 square feet of loggias, garages & guest house. The resort is located four miles to Palm Beach International Airport. Mr. Swanson other developments include the Phipps Estates in Palm Beach and Addison Estates at the Boca Hotel. Judge Erik P. Kimball oversees the case. Kenneth S. Rappaport, Esq., in Boca Raton, Florida, serves as counsel to the Debtor. 1220 SOUTH OCEAN: Initial Status Conference on Oct. 4 ----------------------------------------------------- The Bankruptcy Court in West Palm Beach, Fla., has scheduled an Initial Chapter 11 Status Conference in the Chapter 11 case of 1220 South Ocean Boulevard LLC for Oct. 4, 2012, at 1:30 p.m. at 1515 N Flagler Dr Room 801 Courtroom B, in West Palm Beach. 1220 South Ocean Boulevard, LLC, filed a bare-bones Chapter 11 petition (Bankr. S.D. Fla. Case No. 12-32609) in its home-town in West Palm Beach, Florida. The Debtor disclosed $74 million in total assets and $41.5 million in liabilities as of Sept. 7, 2012. According to http://1220southocean.com/1220 South Ocean is a French-inspired waterfront estate homes and resort located in Palm Beach. Owned by real estate developer Dan Swanson, president of Addison Development, 1220 South Ocean sits on 2.5 private and secure acres of land, has 20,000 square feet of living plus an additional 7,000 square feet of loggias, garages & guest house. The resort is located four miles to Palm Beach International Airport. Mr. Swanson other developments include the Phipps Estates in Palm Beach and Addison Estates at the Boca Hotel. Judge Erik P. Kimball oversees the case. Kenneth S. Rappaport, Esq., in Boca Raton, Florida, serves as counsel to the Debtor. 1555 WABASH: Has Access to Cash Collateral Until Sept. 30 --------------------------------------------------------- Bankruptcy Judge Jacqueline Cox entered a fifth interim order allowing 1555 Wabash LLC to access cash collateral of AMT CADC Venture LLC and Weyerhauser Realty Investors until Sept. 30, 2012. In return for the Debtor's interim use of cash collateral, the Lenders are granted adequate protection for their purported secured interests. The Debtor will, among other things, maintain and pay premiums for insurance to cover all of its assets from fire, theft and water damage; and maintain sufficient cash reserves for the payment of postpetition real estate taxes when these taxes become due and payable. The senior lender, AMT CADC, will be granted a priority claim and valid, perfected, enforceable security interests in and to the Debtor's postpetition assets, to the extent of any diminution in the value of the assets during the period from the commencement of the Debtor's Chapter 11 case through the next hearing on the cash collateral use. Another cash collateral hearing was scheduled for Sept. 19. About 1555 Wabash 1555 Wabash LLC owns and operates a 14-story mixed use building located at 1555 South Wabash, in Chicago, Illinois. The property is comprised of 176 residential units plus 11,000 square feet of commercial space located on the first floor of the building. The property was originally developed as condominium units to be sold at designated sale prices to qualified buyers. Construction was generally completed as of the middle of 2009. Only 36 of the 100 sale contracts closed. As of the Petition Date, 1555 Wabash leased 115 of the remaining 140 residential apartment units -- roughly 82% -- to qualified tenants, while the commercial space is presently vacant. 1555 Wabash LLC filed for Chapter 11 protection (Bankr. N.D. Ill. Case No. 11-51502) on Dec. 27, 2011, to halt foreclosure of the property. Judge Jacqueline P. Cox oversees the case. David K. Welch, Esq., at Crane Heyman Simon Welch & Clar, serves as the Debtor's counsel. The Debtor scheduled $90,055 in personal property and said the current value if its condo building is unknown. The Debtor disclosed $51.6 million in liabilities. The petition was signed by Theodore Mazola, president of New West Realty Development Corp., sole member and manager of the Debtor. 1701 COMMERCE: Seeks Judge OK on $55 Million Hotel Sale ------------------------------------------------------- Jess Davis at Bankruptcy Law360 reports that a subsidiary of Vestin Originations Inc. asked a Texas bankruptcy judge Tuesday to approve a $55 million sale agreement for its Sheraton-branded hotel in Fort Worth to a subsidiary of Dallas-based Prism Hotels & Resorts. The Sheraton Hotel and Spa, owned by Vestin unit 1701 Commerce LLC, filed for Chapter 11 bankruptcy in March, fending off a possible foreclosure. About 1701 Commerce 1701 Commerce LLC, owner and operator of a full service "Sheraton Hotel" located at 1701 Commerce, Fort Worth, Texas, filed for Chapter 11 protection (Bankr. N.D. Tex. Case No. 12-41748) on March 26, 2012. The Debtor also operates a Shula's steakhouse at the Hotel. 1701 Commerce LLC was previously named Presidio Ft. Worth Hotel LLC, but changed its name to 1701 Commerce LLC, prior to the bankruptcy filing date to reduce and minimize any potential confusion relating to an entity named Presidio Fort Worth Hotel LP, an unrelated and unaffiliated partnership that was the former owner of the hotel property owned by the Debtor. 1701 Commerce is a Nevada limited liability company whose members are Vestin Realty Mortgage I, Inc., Vestin Mortgage Realty II, Inc., and Vestin Fund III, LLC. 1701 Commerce LLC's operations are managed by Richfield Hospitality Group, an independent management company that is not affiliated with the Debtor or any of its members. Judge D. Michael Lynn presides over the bankruptcy case. The Law Office of John P. Lewis, Jr., represents the Debtor. The Debtor disclosed $71,842,322 in assets and $44,936,697 in liabilities. ABDIANA A LLC: Files for Chapter 11 in Kansas City --------------------------------------------------- Abdiana A, LLC, filed a Chapter 11 bankruptcy petition (Bankr. W.D.Mo. Case No. 12-44005) on Sept. 25, 2012, estimating at least $10 million in assets and liabilities. Abdiana has filed an application to employ McDowell Rice Smith & Buchanan, P.C., as counsel. The hourly rates currently charged by MRS&B are: Shareholder $175 to $495 Associates $140 to $190 Paralegals $70 to $100 The Debtor said MRS&B does not hold or represent any interests adverse to the bankruptcy estate is a "disinterested person" within the meaning of 11 U.S.C. Sec. 101(14). ADVANCED COMPUTER: Seeks to Use Banco Bilbao Cash Collateral ------------------------------------------------------------ Advanced Computer Technology, Inc., has filed an emergency motion for leave to use Banco Bilbao Vizcaya Argentaria's cash Collateral arising from Debtor's accounts receivable as well as the $262,308 on deposit with the Court of First Instance in Civil Number KCD2004-0604(603), in order to be able to continue its operations. The Debtor's total outstanding amount of principal owed on the Credit Agreement with BBVA is $412,500. According to papers filed with the Bankruptcy Court, BBVA is adequately protected considering BBVA's excess collateral, the pertinent portion of which is well maintained and in excellent condition, with the insurance thereon being current. BBVA will be receiving replacement liens in the generated accounts receivable that will compensate or exceed those to be used. On a monthly basis, the Debtor will submit a report to BBVA as to the accounts receivable collected and generated during the preceding month and will pay BBVA $2,000 per month until the full payment of the Debtor's debt to BBVA. About Advanced Computer San Juan, Puerto Rico-based Advanced Computer Technology, Inc., filed a Chapter 11 petition (Bankr. D.P.R. Case No. 12-04454) in Old San Juan on June 6, 2012. The Debtor, an information system consulting firm, disclosed $10.34 million in assets and $6.176 million in liabilities in its schedules. It said software and licenses rights are worth $6.30 million. The value of its 100% ownership of Sprinter Solutions, Inc., is unknown. Debtor's only shareholder is Investigacion Y Programas, S.A. ("IPSA"). Debtor's president is Jaime Romano and its secretary and chief executive officer is Osvaldo Karuzic, none of whom hold any shares in Debtor. Bankruptcy Judge Brian K. Tester presides over the case. Charles Alfred Cuprill, PSC Law Office, serves as the Debtor's counsel. The petition was signed by Osvaldo Karuzic, chief executive officer. AIRBORNE ACQUISITION: Moody's Assigns 'B2' Corp. Family Rating -------------------------------------------------------------- Moody's Investors Service assigned Airborne Acquisition, Inc. first-time Corporate Family and Probability of Default Ratings of B2. Concurrently, Moody's assigned a B2 rating to the company's proposed $155 million of senior secured bank credit facilities. The ratings outlook is stable. Proceeds from the proposed transaction are expected to be used to fund a $49 million dividend to shareholders, refinance all of the company's existing bank debt and pay related transaction fees and expenses. The B2 rating assigned to the proposed senior secured facilities reflects the preponderance of the proposed debt relative to the company's total debt capitalization. Moody's expects that the facilities will be guaranteed by the company's parent, Airborne Holdings, Inc. and Airborne's existing and future wholly-owned domestic subsidiaries. The following ratings/assessments have been assigned subject to review of final documentation: Corporate family rating, assigned B2 Probability of default rating, assigned B2 Proposed $25 million first lien revolver due 2017, assigned B2 (LGD-4, 50%) Proposed $130 million first lien term loan due 2017, assigned B2 (LGD-4, 50%) Ratings Rationale The B2 Corporate Family Rating broadly reflects Airborne's small revenue scale and aggressive dividend policies, concerns that are particularly acute during the current and coming period of heightened uncertainty with respect to future military spending in the U.S. and the U.K., where the company generates roughly three quarters of its sales. The ratings also reflect the size of the company's proposed $49 million dividend that translates into roughly twice the company's free cash flow generation and a third of its revenue base, and is additive to the $40 million dividend of less than one year ago, demonstrating a clear prediliction to aggressive fiscal policies in favor of shareholders. These factors are counterbalanced by the high likelihood of ongoing long-term U.S. military and foreign military demand for Airborne's technologically advanced parachute systems and related products, the prime position the company holds on the majority of its contracts, and its high win rate. Pro forma debt/EBITDA at close of the transaction is expected approximate 4.2x on a Moody's- adjusted basis. Leverage and interest coverage metrics are expected to be line with the B2 rating level over the intermediate term. The stable outlook is supported by a good liquidity profile and revenue visibility provided by the company's funded backlog, partially offsetting more near-term defense budget pressure concerns. A ratings increase is considered unlikely over the intermediate term given the uncertain defense spending environment, the company's recent dividend policies and relatively small revenue scale. Upward rating movement would depend on the expectation that Airborne would meaningfully increase its revenue base, maintain a good liquidity profile and lower debt/EBITDA towards 3.5x or better on a sustained basis. The ratings could be lowered if the company's liquidity profile were to weaken, or if it were to do an additional debt-financed dividend and debt/EBITDA were to reach and be sustained above 5.0x. The principal methodology used in rating Airborne Acquisition, Inc. was the Global Aerospace and Defense Industry Methodology published in June 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. Airborne Holdings, Inc. ("Airborne"), headquartered in Pennsauken, New Jersey, designs and manufactures parachute systems and related products. The company is a leading provider to the military parachute markets in the United States, United Kingdom and Canada. The company also sells its products to other NATO militaries, other foreign countries and NASA. Revenues for the 2012 fiscal year approximated $160 million. Airborne Acquisition, Inc. is a wholly-owned subsidiary of Airborne Holdings, Inc., the vehicle majority owned by Metalmark Capital, created to effect the acquisition of Airborne Systems in January 2010. ALLEN FAMILY: Plan Filing Deadline Extended to Nov. 29 ------------------------------------------------------ Bankruptcy Judge Kevin J. Carey has approved Allen Family Foods Inc.'s motion for an extension of its exclusive right to file a chapter 11 plan through Nov. 29, 2012, and its exclusive right to solicit acceptances of that plan through Jan. 29, 2013. This is the Debtor's third request for extension. Allen Family Foods Inc. is a 92-year-old Seaford, Delaware, poultry company. Allen Family Foods and two affiliates, Allen's Hatchery Inc. and JCR Enterprises Inc., filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 11-11764) on June 9, 2011. Allen estimated assets and liabilities between $50 million and $100 million in its petition. Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serve as counsel to the Debtors. FTI Consulting is the financial advisor. BMO Capital Markets is the Debtors' investment banker. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Roberta DeAngelis, U.S. Trustee for Region 3, appointed seven creditors to serve on an Official Committee of Unsecured Creditors in the Debtors' cases. Lowenstein Sandler PC and Womble Carlyle Sandridge & Rice, PLLC, serve as counsel for the committee. J.H. Cohn LLP serves as the Committee's financial advisor. ALT HOTEL: Fails to Advance Claim Over Discounted Sale of Debt -------------------------------------------------------------- Bankruptcy Judge A. Benjamin Goldgar dismissed ALT Hotel LLC's claim for unjust enrichment against DiamondRock Allerton Owner, LLC. ALT Hotel has argued that DiamondRock acquired the Debtor's mortgage loan from Wells Fargo at an $8 million discount, paying $61 million for a loan with a face amount of $69 million. Because of the discount, the Debtor alleged, DiamondRock has "greater leverage over the Debtor" in any litigation about the hotel. The Debtor also argued the discount gave the false impression that the hotel was worth less than the principal amounts of the mortgage loan and the mezzanine loan combined. The Debtor asked the Court to reduce DiamondRock's claim by the $8 million. Judge Goldgar, however, said the $8 million was not something the Debtor gave up. If anything, Wells Fargo gave it up, since Wells Fargo was the one to whom the loan was owed and who granted the discount. The Debtor failed to allege that it transferred something of value to DiamondRock. The ruling is among those the judge dispensed in a Sept. 25, 2012 Memorandum Opinion available at http://is.gd/Ka7PkQfrom Leagle.com. Judge Goldgar also denied a request to consolidate these adversary proceedings: (a) ALT Hotel LLC, et al. v. DiamondRock Allerton Owner, LLC, No. 11 A 1469, an action brought by the debtor and its parent against the debtor's senior secured creditor. Pending in the ALT Hotel adversary proceeding is the defendant's motion to dismiss all counts of the third amended complaint for failure to state a claim. (b) Hotel Allerton Mezz, LLC v. Wells Fargo Bank, N.A., et al., No. 11 A 1651, which involves claims originally brought in an Illinois state court foreclosure action, removed to the bankruptcy court, and consolidated into a single amended complaint. Pending in the Hotel Allerton Mezz adversary proceeding is the court's suggestion that it lacks subject matter jurisdiction as well as the plaintiff's motion to consolidate the adversary proceeding with the ALT Hotel adversary proceeding. Judge Goldgar granted, in part, and denied, in part, the motion to dismiss the third amended complaint in the ALT Hotel adversary proceeding. Specifically, the Court denied the request to dismiss the claim for breach of a mortgage loan agreement. As to the other claims, the motion to dismiss is granted. Judge Goldgar remanded the Hotel Mezz adversary proceeding to the Circuit Court of Cook County, Illinois, for lack of jurisdiction. Bankruptcy Plan The Bankruptcy Court has continued until Oct. 29 to Nov. 2, 2012, at 1:30 p.m., the hearings to consider ALT Hotel's First Amended Plan of Reorganization dated July 9, 2012. Under the Plan, secured lender DiamondRock Allerton Owner, LLC will retain its security interests in the property of the Debtor, and the new principal balance will be hiked to $66.8 million (to include the DIP loan) and will bear interest of 4.86%, which interest will be payable for a period of 60 months. On the effective date of the Plan, the guaranty litigation commenced by DiamondRock will be dismissed without prejudice. Each holder of an allowed general unsecured claim will receive 50% of the amount of the claim on the Effective Date and 50% of the balance of the holder's Claim, together with interest computed at the rate of 5% per annum, 180 days after the Effective Date. Hotel Allerton Mezz, as sole holder of an interest in the Debtor, will have its deficiency claim accrue interest at the rate of 7% per annum commencing upon the Effective Date. It will receive a payment equal to the amount of excess cash flow, if any, which will be applied first to accrued and unpaid interest and second to principal, until the allowed deficiency claim, together with all interest that has accrued thereon, has been paid in full. Hotel Allerton's equity interests in the Debtor are unimpaired. A full-text copy of the First Amended Plan is available for free at http://bankrupt.com/misc/ALT_HOTEL_plan_1amended.pdf About ALT Hotel LLC ALT Hotel, LLC's sole asset is the Allerton Hotel located in the "Magnificent Mile" area of Chicago. The Hotel is managed by Kokua Hospitality, LLC, pursuant to a Hotel Management Agreement, dated Nov. 9, 2006. Kokua is the exclusive manager and operator of the Hotel, and receives management fees for its services, with the amount of such fees directly linked to the annual performance of the Hotel. Hotel Allerton Mezz, LLC, is the sole member of ALT Hotel. ALT Hotel filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 11-19401) on May 5, 2011. Judge A. Benjamin Goldgar presides over the case. Neal L. Wolf, Esq., Dean C. Gramlich, Esq., and Jordan M. Litwin, Esq., at Neal Wolf & Associates, LLC, in Chicago, Illinois, serve as bankruptcy counsel to the Debtor. In its petition, the Debtor estimated $100 million to $500 million in assets and $50 million to $100 million in debts. FTI Consulting serves as the Debtor's financial advisors. Affiliate PETRA Fund REIT Corp. sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 10-15500) on Oct. 20, 2010. AMERICAN AIRLINES: Senior Pilots Seek Stay on Appeal ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a group of 130 American Airlines Inc. pilots hired before 1983 filed papers on Sept. 25 asking the bankruptcy judge to hold up implementation of his ruling early this month that allows the unit of AMR Corp. to modify the pilots' union contract. According to the report, the pilot group explained how they gave concessions to AMR in 1983 to avoid bankruptcy at the time. In return, the contract provided that the company in the future would take no action to reduce pay or retirement benefits for pilots hired before Nov. 1, 1983. The senior pilots contend AMR began violating the 1983 agreement even before the bankruptcy judge approved additional concessions over objections from the pilots' union. The senior pilots want the bankruptcy judge to freeze his ruling pending appeal, thus avoiding "irreparable injury" when AMR implements changes in retirement and health benefits on Nov. 1. The pilots contend the bankruptcy court had no ability to override grievance procedures and mandates of the Railway Labor Act. The Bloomberg report discloses the pilots' union filed a motion last week also seeking a stay of contract modifications pending appeal. The union's request and the senior pilots' motions will both come to court for hearing on Oct. 9. 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). ARCAPITA BANK: Aims to Finalize Sharia Financing from Silver Point ------------------------------------------------------------------ Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports that Arcapita Bank is hoping to secure a $150 million commitment for Sharia-compliant bankruptcy financing, the first of its kind, from Silver Point Finance LLC. About Arcapita Bank Arcapita Bank B.S.C., also known as First Islamic Investment Bank B.S.C., along with affiliates, filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19, 2012. The Debtors said they do not have the liquidity necessary to repay a US$1.1 billion syndicated unsecured facility when it comes due on March 28, 2012. Falcon Gas Storage Company, Inc., later filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas is an indirect wholly owned subsidiary of Arcapita that previously owned the natural gas storage business NorTex Gas Storage Company LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock of NorTex from Falcon Gas for $515 million. Arcapita guaranteed certain of Falcon Gas' obligations under the NorTex Purchase Agreement. The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP as international counsel on Bahrain matters, Hatim S Zu'bi & Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild Inc. and financial advisor, and GCG Inc. as notice and claims agent. Milbank, Tweed, Hadley & McCloy LLP represents the Official Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc., serves as its financial advisor and investment banker. Founded in 1996, Arcapita is a global manager of Shari'ah- compliant alternative investments and operates as an investment bank. Arcapita is not a domestic bank licensed in the United States. Arcapita is headquartered in Bahrain and is regulated under an Islamic wholesale banking license issued by the Central Bank of Bahrain. The Arcapita Group employs 268 people and has offices in Atlanta, London, Hong Kong and Singapore in addition to its Bahrain headquarters. The Arcapita Group's principal activities include investing on its own account and providing investment opportunities to third-party investors in conformity with Islamic Shari'ah rules and principles. The Arcapita Group has roughly US$7 billion in assets under management. On a consolidated basis, the Arcapita Group owns assets valued at roughly US$3.06 billion and has liabilities of roughly US$2.55 billion. The Debtors owe US$96.7 million under two secured facilities made available by Standard Chartered Bank. Arcapita explored out-of-court restructuring scenarios but was unable to achieve 100% lender consent required to effectuate the terms of an out-of-court restructuring. Subsequent to the Chapter 11 filing, Arcapita Investment Holdings Limited, a wholly owned Debtor subsidiary of Arcapita in the Cayman Islands, issued a summons seeking ancillary relief from the Grand Court of the Cayman Islands with a view to facilitating the Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as provisional liquidator. ARCAPITA BANK: Seeks Final Exclusive Extension; Plan Near --------------------------------------------------------- Arcapita Bank B.S.CV.(c), et al., have requested a further 60-day extension of their exclusive periods to file a plan and to solicit acceptances of a plan, until Dec. 14, 2012, and Feb. 12, 2013, in order to complete the considerable work that still needs to be done in the Debtors' cases. This is the second request for extension of the exclusive periods. The Debtors said they will not seek a further extension of the exclusive filing period past Dec. 14, 2012. The Debtors relate that, on or before Dec. 14, 2012, they will file a plan of reorganization that provides, in the same plan document, for the Debtors' emergence from Chapter 11 pursuant to (a) a "new money" plan, provided that the new equity infusion is committed and available when the confirmation hearing is held or, if it is not, (b) pursuant to an alternative "stand alone plan" that provides for the managed disposition and distribution of the Debtors' assets. A hearing to consider the motion will be held on Oct. 9, 2012, at 2:00 p.m. Objections, if any, to the motion must be received no later than Oct. 2, 2012, at 2:00 p.m. According to papers filed with the Bankruptcy Court, the Toggle Plan represents the most efficient and effective way for the Debtors to exit Chapter 11 because it allows the Debtors an opportunity to complete their solicitation of a new equity infusion, while providing for an immediate alternative if the new equity raise is unsuccessful. About Arcapita Bank Arcapita Bank B.S.C., also known as First Islamic Investment Bank B.S.C., along with affiliates, filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19, 2012. The Debtors said they do not have the liquidity necessary to repay a US$1.1 billion syndicated unsecured facility when it comes due on March 28, 2012. Falcon Gas Storage Company, Inc., later filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas is an indirect wholly owned subsidiary of Arcapita that previously owned the natural gas storage business NorTex Gas Storage Company LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock of NorTex from Falcon Gas for $515 million. Arcapita guaranteed certain of Falcon Gas' obligations under the NorTex Purchase Agreement. The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP as international counsel on Bahrain matters, Hatim S Zu'bi & Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild Inc. and financial advisor, and GCG Inc. as notice and claims agent. Milbank, Tweed, Hadley & McCloy LLP represents the Official Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc., serves as its financial advisor and investment banker. Founded in 1996, Arcapita is a global manager of Shari'ah- compliant alternative investments and operates as an investment bank. Arcapita is not a domestic bank licensed in the United States. Arcapita is headquartered in Bahrain and is regulated under an Islamic wholesale banking license issued by the Central Bank of Bahrain. The Arcapita Group employs 268 people and has offices in Atlanta, London, Hong Kong and Singapore in addition to its Bahrain headquarters. The Arcapita Group's principal activities include investing on its own account and providing investment opportunities to third-party investors in conformity with Islamic Shari'ah rules and principles. The Arcapita Group has roughly US$7 billion in assets under management. On a consolidated basis, the Arcapita Group owns assets valued at roughly US$3.06 billion and has liabilities of roughly US$2.55 billion. The Debtors owe US$96.7 million under two secured facilities made available by Standard Chartered Bank. Arcapita explored out-of-court restructuring scenarios but was unable to achieve 100% lender consent required to effectuate the terms of an out-of-court restructuring. Subsequent to the Chapter 11 filing, Arcapita Investment Holdings Limited, a wholly owned Debtor subsidiary of Arcapita in the Cayman Islands, issued a summons seeking ancillary relief from the Grand Court of the Cayman Islands with a view to facilitating the Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as provisional liquidator. ARCAPITA BANK: Asks Court's OK for $150-Mil DIP Financing --------------------------------------------------------- Arcapita Bank B.S.CV.(c), et al., seek the approval of the Bankruptcy Court to enter into a financing commitment letter with Silver Point Finance, LLC, for a $150 million DIP financing facility and to incur the associated fees, expenses and indemnities. According to papers filed with the Court, the Debtors need to obtain debtor-in-possession financing to enable them to maximize the value of the Arcapita Group portfolio companies and investments and bridge the Debtors' cash needs through their projected Chapter 11 emergence in the first quarter of 2013. The borrower under the Proposed Transaction will be Arcapita Investment Holdings Limited ("AIHL"). Arcapita, Arcapita LT Holdings Limited, Windturbine Holdings Limited, AEID II Holdings Limited, RailInvest Holdings Limited, Arcapita Inc., Arcapita Investment Management Limited, Arcapita Structured Finance Ltd, Arcapita Investment Funding Limited, Arcapita Industrial Management I Limited, Arcapita Limited, and Arcapita Pte. Limited (Singapore) will act as Guarantors. To date, the Debtors have not sought postpetition financing or use of any secured lender's cash collateral. The commitment is subject to (a) satisfactory completion of Silver Point's due diligence and (b) receipt of final Silver Point credit committee approval. Pursuant to the Commitment Letter, once the Debtors receive notice that the Subject Conditions Precedent are satisfied, Silver Point will be entitled to a 1.50% Commitment Fee. If the Commitment Letter is terminated as a result of the Debtors' negotiation or execution of any alternative financing proposal, notwithstanding whether the Subject Conditions Precedent have yet been waived or satisfied, Silver Point will be entitled to a fee equal to 0.75% of the amount of the facility in connection with the proposed transaction. Silver Point will be entitled to reimbursement up to $900,000 for all reasonable and documented fees and expenses. The Debtors agree to indemnify and hold harmless Silver Point and each other DIP Participant from and against any and all actions, suits, proceedings, claims, losses, damages, liability or expenses of any kind. The maturity date of the DIP financing will be the earliest of: -- March 31, 2013; -- the effective date of a Chapter 11 plan for the Debtors; -- the date the Court orders the conversion of the bankruptcy case of any Debtor Obligor to a Chapter 7 liquidation or the dismissal of the bankruptcy case of any Debtor Obligor; -- the acceleration of the deferred sale price; and -- the date upon which the sale of all or substantially all of the Debtors' assets is consummated. To the extent the proposed transactions contemplated in the Commitment Letter have not been consummated by the later of (a) Oct. 15, 2012 or (b) 21 days after the Company has been notified in writing that the subject conditions precedent have been satisfied, Silver Point will have the right to terminate the Commitment Letter; provided that, in no case may Silver Point terminate if such failure to meet one of the foregoing deadlines is a sole and direct consequence of Silver Point's material breach of its material obligations under the Commitment Letter. About Arcapita Bank Arcapita Bank B.S.C., also known as First Islamic Investment Bank B.S.C., along with affiliates, filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19, 2012. The Debtors said they do not have the liquidity necessary to repay a US$1.1 billion syndicated unsecured facility when it comes due on March 28, 2012. Falcon Gas Storage Company, Inc., later filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas is an indirect wholly owned subsidiary of Arcapita that previously owned the natural gas storage business NorTex Gas Storage Company LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock of NorTex from Falcon Gas for $515 million. Arcapita guaranteed certain of Falcon Gas' obligations under the NorTex Purchase Agreement. The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP as international counsel on Bahrain matters, Hatim S Zu'bi & Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild Inc. and financial advisor, and GCG Inc. as notice and claims agent. Milbank, Tweed, Hadley & McCloy LLP represents the Official Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc., serves as its financial advisor and investment banker. Founded in 1996, Arcapita is a global manager of Shari'ah- compliant alternative investments and operates as an investment bank. Arcapita is not a domestic bank licensed in the United States. Arcapita is headquartered in Bahrain and is regulated under an Islamic wholesale banking license issued by the Central Bank of Bahrain. The Arcapita Group employs 268 people and has offices in Atlanta, London, Hong Kong and Singapore in addition to its Bahrain headquarters. The Arcapita Group's principal activities include investing on its own account and providing investment opportunities to third-party investors in conformity with Islamic Shari'ah rules and principles. The Arcapita Group has roughly US$7 billion in assets under management. On a consolidated basis, the Arcapita Group owns assets valued at roughly US$3.06 billion and has liabilities of roughly US$2.55 billion. The Debtors owe US$96.7 million under two secured facilities made available by Standard Chartered Bank. Arcapita explored out-of-court restructuring scenarios but was unable to achieve 100% lender consent required to effectuate the terms of an out-of-court restructuring. Subsequent to the Chapter 11 filing, Arcapita Investment Holdings Limited, a wholly owned Debtor subsidiary of Arcapita in the Cayman Islands, issued a summons seeking ancillary relief from the Grand Court of the Cayman Islands with a view to facilitating the Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as provisional liquidator. AS SEEN ON TV: Receives $1.3 Million from Sales of Securities ------------------------------------------------------------- As Seen On TV, Inc., completed on Sept. 20, 2012, a private placement of its 12% Senior Secured Convertible Notes pursuant to a Securities Purchase Agreement dated Sept. 7, 2012, raising aggregate gross proceeds of $1,275,000. The Company entered into the Securities Purchase Agreement with 11 accredited investors. The Notes bear interest at a rate of 12% per annum. The Note is due and payable on March 20, 2013. In the event a qualified financing is not consummated on or before the Maturity Date, the entire principal amount of the Note, along with all accrued interest thereon, will, at the option of the holder, be convertible into the Company's Common Stock, par value $0.0001 per share at a conversion price equal to at a conversion price equal to 20% discount to the average daily volume weighted average price of the Common Stock for the 10 trading days immediately preceding the Maturity Date on the trading market on which the Common Stock is then listed or quoted. The indebtedness evidenced by the Notes will be senior to, and have priority in right of payment over, all indebtedness of Company now outstanding. The Notes are secured by a first lien and security interest in all of the assets of the Company and its wholly-owned subsidiary, TV Goods, Inc., pursuant to the terms of a certain Security Agreement dated as of Sept. 7, 2012, by the Company in favor of Collateral Agents, LLC, as agent of the Investors. The Company also agreed under the Securities Purchase Agreement to indemnify the Investors for losses arising out of or resulting from material breaches of representations, warranties, agreements and covenants made by the Company in the Securities Purchase Agreement or the other agreements entered into in connection therewith. In connection with the Securities Purchase Agreement, Company engaged National Securities Corporation, to act as the Company's exclusive agent for the offering. In exchange for National acting as the exclusive agent for the Securities Purchase Agreement, the Company agreed to pay to National a cash placement fee equal to 10% of the aggregate gross proceeds from the sale of Notes sold to investors. As additional compensation, the Company issued to National or its designees, for nominal consideration, common stock purchase warrants equal to 10% of the number of shares of Common Stock issuable upon conversion of the Notes at an exercise price equal to $0.80 per share. The Agent's Warrants provide the holder thereof with immediate cashless exercise rights and "weighted average" price protection right consistent with the terms of the Warrants and are exercisable for three years. The Company received net proceeds of $1,124,425 after payment of an aggregate of $127,500 of commissions and expense allowance to National, and approximately $23,075 of other offering and related costs in connection with the private placement. The Company will use the net proceeds from the Securities Purchase Agreement for working capital purposes, including advancing $500,000 to eDiets.com, Inc., under a 12% Convertible Note dated Sept. 6, 2012. The eDiets Note is due and payable on the earlier of the date that is 10 business days following the earlier to occur of (i) the closing date of the proposed merger by and between the Company and eDiets; (ii) Dec. 31, 2012; or (iii) an event of default as defined under the eDiets Note. Interest on the Note accrues at a rate of 12% per annum and is due and payable upon the maturity date of the eDiets Note. About As Seen on TV Clearwater, Fla.-based As Seen On TV, Inc., is a direct response marketing company. It identifies, develops, and markets consumer products. The Company reported a net loss of $8.07 million on $8.16 million of revenue for the year ended March 31, 2012, compared with a net loss of $6.97 million on $1.35 million of revenue during the prior fiscal year. The Company's balance sheet at March 31, 2012, showed $9.78 million in total assets, $27.05 million in total liabilities, all current, and a $17.26 million total stockholders' deficiency. ASHLAND UNIVERSITY: Moody's Extends Review on 'Ba3' Bond Rating ---------------------------------------------------------------- Moody's Investors Service has extended the review period for Ashland University's (OH) $37 million of Series 2010 rated bonds. The Ba3 rating is under review for further possible downgrade after having been downgraded to its current rating from Ba1 and placing it under review on September 10, 2012. Moody's has extended the time period it expects to conclude the review to obtain the university's audited FY 2012 financial statements and await the final resolution and waiver related to an expected debt service coverage ratio covenant violation. Principal Rating Methodology The principal methodology used in this rating was U.S. Not-for- Profit Private and Public Higher Education, published in August 2011. ATLAS PIPELINE: Moody's Affirms B1 CFR; Raises Note Rating to B2 ---------------------------------------------------------------- Moody's Investors Service upgraded Atlas Pipeline Partners, L.P.'s senior unsecured note rating to B2 from B3 following an announcement that the company plans to issue $300 million of new senior unsecured notes due 2020. At the same time, Moody's affirmed Atlas' B1 Corporate Family Rating (CFR) and Probability of Default Rating (PDR). The SGL-3 Speculative Grade Liquidity rating remains unchanged. The outlook is stable. Net proceeds from the note offering will be used to repay a portion of the outstanding borrowings under Atlas' revolving credit facility. The 2020 notes will rank pari passu with Atlas' existing 8.75% notes due 2018, and will be subordinated in right of payment to the $600 million senior secured credit facility. "Under Moody's Loss Given Default Methodology, the higher amount of unsecured debt in the capital structure following this proposed note issuance increases overall recovery for the unsecured debt class relative to the priority-claim secured revolving credit facility, causing the notes to move up a notch to B2," said Sajjad Alam, Moody's Analyst. "This is effectively a debt-for-debt transaction and does not have any material impact on Atlas' fundamental credit profile." Issuer: Atlas Pipeline Partners, L.P. Upgrades: US$371M 8.75% Senior Unsecured Regular Bond/Debenture, Upgraded to B2 from B3 US$371M 8.75% Senior Unsecured Regular Bond/Debenture, Upgraded to a range of LGD5, 74 % from a range of LGD5, 78 % Assignments: US$300M Senior Unsecured Regular Bond/Debenture, Assigned B2 US$300M Senior Unsecured Regular Bond/Debenture, Assigned a range of LGD5, 74 % Ratings Rationale Atlas' B1 Corporate Family Rating (CFR) reflects the company's small scale and concentrated operations in the Mid-Continent region, the inherent price and volume risks of its core gathering and processing business and the high-payout model of the master limited partnership (MLP) organizational structure. The rating also considers the execution and funding risks involving the perpetual capacity expansion projects and potential acquisitions and the likelihood of higher debt burden in 2013 The rating is supported by the partnership's moderate leverage, solid organic growth profile, long-term contracting arrangements, and the routine practice of hedging its commodity price exposure associated with the percentage of proceeds and keep-whole contracts. Atlas should have adequate liquidity through 2013, which is captured in the SGL- 3 rating. Following the note issue and reduction of revolver debt, the company will have increased availability to cover its anticipated negative free cash flow in 2013 resulting from project based expenditures. Moody's expects sufficient covenant cushion through the end of 2013 and unimpeded access to the revolving line of credit. The credit facility expires in May, 2017. Atlas' alternative sources of liquidity are limited principally to the sale of existing assets, which are largely encumbered. The stable outlook reflects Moody's view that the demand for gathering and processing services in Atlas' core areas will remain healthy and the company will manage its growth without substantially increasing leverage or depleting liquidity. Greater scale and diversification combined with a manageable debt profile would be the key catalysts for an upgrade. More specifically, Moody's would look for EBITDA approaching the $300 million level and a debt to EBITDA measure around 3.5x in considering an upgrade. The rating could be downgraded if it appears that leverage may remain above 4.5x over a protracted period. A negative rating action could also result from significant erosion of liquidity. The principal methodologies used in rating Atlas were the Global Midstream Energy Rating Methodology published in December 2010 and the Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA Methodology published in June 2009. Atlas Pipeline Partners, L.P. is a publicly traded master limited partnership (MLP) engaged primarily in the gathering, processing, and transportation segments of the midstream natural gas industry. AUTO SPORTS: Receivers to Auction Off Assets -------------------------------------------- The Holland Sentinel reports that Zeeland Township's Auto Sports Unlimited Inc. will be auctioned off as a court-appointed receiver begins to try to recoup what it says are $25 million in debts owed by local entrepreneur Scott Bosgraaf and Bosgraaf-controlled entities. According to the report, Amicus Management said the proceeds will go to first-tier creditors -- such as First Financial Bank N.A., Huntington Bank and CB2010 -- other creditors, and governmental units for back taxes. The Holland Sentinel relates that an Amicus official said over the past several months, Amicus Management has overseen the sale of units of the Baker Lofts condominium project in Holland, a commercial building in Spring Lake, and a condominium in Hudsonville. BEALL CORPORATION: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Beall Corporation dba Beall Trailers of Oregon, Inc. Beall Trailers of California, Inc. Beall Trailers of Montana, Inc. Beall Trailers of SoCal, Inc. Beall Trailers of Colorado, Inc. Beall Trailers of Dakota, Inc. Beall Trailers of Washington, Inc. Beall Transport Equipment Co. Beall Transport Equipment of Montana, Inc. Pioneer Truckweld Beall Trailers of Arizona, Inc. K & H Manufacturing Co. aka Beall Sunnyside 8801 N. Vancouver Portland, OR 97217 Bankruptcy Case No.: 12-37291 Chapter 11 Petition Date: September 24, 2012 Court: U.S. Bankruptcy Court District of Oregon Judge: Elizabeth L. Perris About the Debtor: Beall is a manufacturer of lightweight, efficient, and durable tanker trucks, trailers and related products. Founded in 1905, the Debtor has four factories and nine sale branches across the U.S. The Debtor has 285 employees, with an average weekly payroll of $300,000. Debtor's Counsel: Albert N. Kennedy, Esq. TONKON TORP LLP 888 SW 5th Avenue, #1600 Portland, OR 97204 Tel: (503) 802-2013 E-mail: al.kennedy@tonkon.com - and ? Michael W. Fletcher, Esq. TONKON TORP LLP 888 SW 5th Avenue, #1600 Portland, OR 97204 Tel: (503) 802-2169 E-mail: michael.fletcher@tonkon.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Scott Koch, vice president, treasurer, CFO. Debtor's List of Its 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Pacific Metal Company Trade Creditor $832,866 P.O. Box 5000 #1 Portland, OR 97208-5000 Joseph T Ryerson & Son Inc. Trade Creditor $495,647 227 West Monroe Street, 27th Floor Chicago IL 60606 Amsco Windows Trade Creditor $169,475 P.O. Box 25368 Salt Lake City, UT 84125-0368 Civacon / Knappco Trade Creditor $163,308 Tacoma Screw Products Inc. Trade Creditor $138,969 Miller Nash LLP Legal Services $132,610 Main Steel Polishing Trade Creditor $103,864 HW Metal Products Inc. Trade Creditor $83,136 Transport Distribution Trade Creditor $66,118 Services Inc. Cossette Investment Co., Inc. Trade Creditor $65,401 Pro Tech Industries Inc. Trade Creditor $53,479 Fastenal Company Trade Creditor $51,571 Robert Sos Signs Inc. Trade Creditor $51,225 Bramasol Inc. Trade Creditor $48,866 Titan Logix Corp. Trade Creditor $48,414 Trax Mechanical Systems Trade Creditor $46,301 Hastings Irrigation Pipe Co. Trade Creditor $41,147 Advanced Wheel Sales Trade Creditor $38,457 W.W. Grainger Trade Creditor $37,733 SAF Holland USA Inc. Trade Creditor $36,589 BHFS I LLC: Can Access Cash Collateral of BofA Until Jan. 31 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Texas authorized BHFS I, LLC, et al., to use cash collateral commencing on Sept. 1, 2012, and ending Jan. 31, 2013, pursuant to a budget covering said final period, with a permitted variance of 10% for any line item in the budget. The Debtors may exceed the entire budgeted amount by no more than 5%. Four debtors -- BHFS I LLC, BHFS II, LLC, BHFS III, LLC, and BHFS IV, LLC -- are obligated to Bank of America, N.A., as agent for itself and for Regions Bank, in an amount $43.8 million as of the Petition Date. Among their collateral, the lenders have first priority security interests in the cash collateral of the Debtors. BHFS Theater, LLC, is obligated to Bank of America in an amount of $4.6 million as of the Petition Date. Among its collateral, BofA has first priority security interests in the cash collateral of the Theater Debtor. The Syndicated Loan is also secured by a second lien on the property of the Theater Debtor, and consequently also secured by a second lien in the Cash Collateral of the Theater Debtor. About BHFS Addison, Texas-based BHFS I LLC and its affiliates, owners of the Frisco Square master-planned development in the Dallas suburb of Frisco, filed for Chapter 11 protection (Bankr. E.D. Tex. Case No. 12-41581 to 12-41585) on June 13 in Sherman. The affiliates are Behringer Harvard Frisco Square LP, BHFS II LLC, BHFS III LLC, BHFS IV LLC, and BHFS Theater LLC. BHFS I and BHFS II each estimated assets and debts of $10 million to $50 million. In its schedules, BHFS I LLC disclosed $28,947,198 in total assets and $13,742,348 in total liabilities. The Debtors own and operate substantial office, retail, and residential rental space at the highly regarded project known as "Frisco Square," in Frisco, Texas. The project has 103,120 square feet of rentable office space in three buildings, 110,395 square feet of retail space in six buildings, including a 12-screen, 41,464 square-foot Cinemark theater, and 114 high-end multifamily rental units in two buildings, all built between 2000 and 2010. Occupancy rates are more than 85% for the office and retail space and almost 95% for multifamily space. Judge Brenda T. Rhoades presides over the case. Davor Rukavina, Esq., and Jonathan Lindley Howell, Esq., at Munsch Hardt Kopf & Harr, P.C., serve as the Debtors' counsel. The petition was signed by Michael J. O'Hanlon, president. George H. Barber, Esq., and David D. Ritter, Esq., at Kane Russell Coleman & Logan PC, represent Regions Bank. Bank of America, N.A., is represented by Keith M. Aurzada, Esq., and John Leininger at Bryan Cave. BHFS I LLC: BofA Objects to First Motion to Extend Exclusivity -------------------------------------------------------------- Bank of America, N.A., as agent for itself and Regions Bank, objects to BHFS I, LLC, et al.'s first motion to extend the exclusivity period, in which only the Debtors may file a plan of reorganization, for 90 days beyond the present expiration date of Jan. 9, 2013, and an additional 60 days after Jan. 9, 2013, to confirm a plan of reorganization. According to BofA, contrary to the assertions in the motion, the Debtors have failed to engage in meaningful restructuring negotiations with Lender, and that many of the Debtors are operating at a loss and can only meet their monthly payment obligations by borrowing funds from other Debtors. Finally, the Debtors' bankruptcy cases are not complex: five of the Debtors are single asset real estate entities and the other is a holding company whose main assets are the five other Debtors. Further, the Debtors have failed to meaningfully progress their cases forward and have demonstrated no extenuating circumstances that would necessitate extending the exclusivity period. The hearing on the motion is continued and reset for hearing on Oct. 11, 2012, at 9:30 a.m. About BHFS Addison, Texas-based BHFS I LLC and its affiliates, owners of the Frisco Square master-planned development in the Dallas suburb of Frisco, filed for Chapter 11 protection (Bankr. E.D. Tex. Case No. 12-41581 to 12-41585) on June 13 in Sherman. The affiliates are Behringer Harvard Frisco Square LP, BHFS II LLC, BHFS III LLC, BHFS IV LLC, and BHFS Theater LLC. BHFS I and BHFS II each estimated assets and debts of $10 million to $50 million. In its schedules, BHFS I LLC disclosed $28,947,198 in total assets and $13,742,348 in total liabilities. The Debtors own and operate substantial office, retail, and residential rental space at the highly regarded project known as "Frisco Square," in Frisco, Texas. The project has 103,120 square feet of rentable office space in three buildings, 110,395 square feet of retail space in six buildings, including a 12-screen, 41,464 square-foot Cinemark theater, and 114 high-end multifamily rental units in two buildings, all built between 2000 and 2010. Occupancy rates are more than 85% for the office and retail space and almost 95% for multifamily space. Judge Brenda T. Rhoades presides over the case. Davor Rukavina, Esq., and Jonathan Lindley Howell, Esq., at Munsch Hardt Kopf & Harr, P.C., serve as the Debtors' counsel. The petition was signed by Michael J. O'Hanlon, president. George H. Barber, Esq., and David D. Ritter, Esq., at Kane Russell Coleman & Logan PC, represent Regions Bank. Bank of America, N.A., is represented by Keith M. Aurzada, Esq., and John Leininger at Bryan Cave. BIOFUEL ENERGY: Idling Minnesota Plant, Operating Nebraska Plant ---------------------------------------------------------------- Biofuel Energy Corp. has decided to idle its Fairmont, Minnesota ethanol facility until further notice. The plant ceased ethanol production as of the end of last week. The Company reported that its second plant in Wood River, Nebraska, continues to operate. "Commodity margins have continued to weaken as the impact of the drought in the Corn Belt continues and ethanol remains in surplus," said Scott H. Pearce, the Company's President and Chief Executive Officer. "As a result, our current expectations are that the Fairmont plant will remain idle until we are able to secure local corn at price levels that support better margins. In the meantime, we will not be making any changes to our current operations team so that we can continue to operate the grain elevator and are in a position to re-start the ethanol plant on short notice." About Biofuel Energy Denver, Colo.-based BioFuel Energy Corp. (Nasdaq: BIOF) -- http://www.bfenergy.com/-- aims to become a leading ethanol producer in the United States by acquiring, developing, owning and operating ethanol production facilities. It currently has two 115 million gallons per year ethanol plants in the Midwestern corn belt. The Company reported a net loss of $10.36 million in 2011, compared with a net loss of $25.22 million during the prior year. BioFuel Energy's balance sheet at June 30, 2012, showed $275.09 million in total assets, $197.90 million in total liabilities and $77.18 million in total equity. Bankruptcy Warning "Drought conditions in the American Midwest have significantly impacted this year's corn crop and caused a significant reduction in the anticipated corn yield," the Company said in its quarterly report for the period ended June 30, 2012. "Since the end of the second quarter, this has led to a dramatic increase in the price of corn and a corresponding narrowing in the crush spread. Should current commodity margins continue for an extended period of time, we may not generate sufficient cash flow from operations to both service our debt and operate our plants. We are required to make, under the terms of our Senior Debt Facility, quarterly principal payments in a minimum amount of $3,150,000, plus accrued interest. We cannot predict when or if crush spreads will fluctuate again or if the current commodity margins will improve or worsen. If crush spreads were to remain at current levels for an extended period of time, we may expend all of our sources of liquidity, in which event we would not be able to pay principal and interest on our debt. In the event crush spreads narrow further, we may choose to curtail operations at our plants or cease operations altogether until such time as crush spreads improve. Any inability to pay principal and interest on our debt would lead to an event of default under our Senior Debt Facility, which, in the absence of forbearance, debt service abeyance or other accommodations from our lenders, could require us to seek relief through a filing under the U.S. Bankruptcy Code. We expect fluctuations in the crush spread to continue." BION ENVIRONMENTAL: GHP Horwath Raises Going Concern Doubt ---------------------------------------------------------- Bion Environmental Technologies, Inc., filed on Sept. 25, 2012, its annual report on Form 10-K for the fiscal year ended June 30, 2012. GHP Horwath, P.C., in Denver, expressed substantial doubt about Bion Environmental's ability to continue as a going concern. The independent auditors noted that the Company has not generated revenue and has suffered recurring losses from operations. The Company reported a net loss of $6.5 million on $0 revenue for fiscal 2012, compared with a net loss of $7.0 million on $0 revenue for fiscal 2011. The Company's balance sheet at June 30, 2012, showed $8.7 million in total assets, $9.4 million in total liabilities, $43,650 in Series B Redeemable Preferred stock, and a stockholders' deficit of $774,180. The Company continues to explore sources of additional financing to satisfy its current operating requirements as it is not currently generating any revenues. During fiscal year 2012 the Company experienced greater difficulty in raising equity funding than in the prior year. As a result, the Company faced (and continues to face), significant cash flow management challenges due to severe working capital constraints. While the Company hopes to commence revenue generation during the 2013 fiscal year, it is not currently generating any revenues. To partially mitigate these working capital constraints, the Company's core senior management and several key employees have been deferring cash compensation. As of Sept. 19, 2012, such deferrals totaled approximately $1,046,000 (including accrued interest). From July 1, 2012, through Sept. 19, 2012, the Company has raised proceeds of $322,500 through sale of its securities and anticipates raising additional funds from such sales. However, there is no guarantee that the Company will be able to raise sufficient funds or further capital for the operations planned in the near future. A copy of the Form 10-K is available at http://is.gd/cmoPcE Crestone, Colo.-based Bion Environmental Technologies for several years, focused on completion of the development of the next generation of its technology which provides a comprehensive environmental solution to a significant source of pollution in U.S. agriculture, large scale livestock facilities known as Confined Animal Feeding Operations. The re-development process is now substantially complete and the initial commercial system, based on the Company's updated technology, has been constructed and placed in full commercial operation. BION ENVIRONMENTAL: Incurs $7.3 Million Net Loss in Fiscal 2012 --------------------------------------------------------------- Bion Environmental Technologies, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss applicable to the Company's common stockholders of $7.35 million on $0 of revenue for the year ended June 30, 2012, compared with a net loss applicable to the Company's common stockholders of $7.54 million on $0 of revenue for the same period during the prior year. The Company's balance sheet at June 30, 2012, showed $8.67 million in total assets, $9.41 million in total liabilities, $43,650 in Series B Redeemable Convertible Preferred Stock, and a $774,180 total deficit. GHP HORWATH, P.C., in Denver, Colorado, issued a "going concern" qualification on the consolidated financial statements for the fiscal year ended June 30, 2012. The independent auditors noted that the Company has not generated revenue and has suffered recurring losses from operations which raise substantial doubt about its ability to continue as a going concern. A copy of the Form 10-K is available for free at: http://is.gd/cmoPcE About Bion Environmental Bion Environmental Technologies Inc.'s patented and proprietary technology provides a comprehensive environmental solution to a significant source of pollution in US agriculture, large scale livestock facilities known as Confined Animal Feeding Operations. Bion's technology produces substantial reductions of nutrient releases (primarily nitrogen and phosphorus) to both water and air (including ammonia, which is subsequently re-deposited to the ground) from livestock waste streams based upon the Company's operations and research to date (and third party peer review). BIRMINGHAM-JEFFERSON CIVIC: S&P Ups Rating on 2002C Bonds From 'B' ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its long-term rating and underlying rating (SPUR) to 'AA' from 'AA-' and 'B' on the Birmingham-Jefferson Civic Center Authority (BJCC), Ala.'s series 2002C bonds. "The outlook on the long-term rating is stable, and we have revised the outlook on the SPUR to stable from negative," S&P said. "The rating action reflects our view of clarification on how Jefferson County's November bankruptcy filing will affect pledged revenue," said Standard & Poor's credit analyst Brian Marshall. "None of the BJCC's debt was listed in the original bankruptcy filing, nor was its debt named in the county's bankruptcy resolution, and we understand that the county may in no way impair pledged revenue," S&P said. "The rating reflects our view of the bond's legal covenants and pledged revenue," S&P said. The rating also reflects S&P's view of the authority's: -- Availability of more than $45 million in sales tax revenue, per state statute, to make up potential shortfalls in pledged tobacco and lodging tax revenue; -- Coverage of 19x maximum annual debt service (MADS) based on statutorily available sales tax revenue; -- Additional bonds test (ABT) that essentially caps MADS at $2.4 million and requires the sales tax base to provide no less than 3x MADS; and -- Decreased likelihood of additional debt given that it can use excess revenue for operations. "The stable outlook reflects our anticipation that the county's significant sales tax base will be stable given its role as a major regional economy in the state," S&P said. BIRMINGHAM-JEFFERSON CIVIC: S&P Ups Rating on 2005A Bonds From 'B' ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its long-term rating and underlying rating (SPUR) to 'A+' from 'B' on Birmingham-Jefferson Civic Center Authority (BJCC), Ala.'s series 2005A bonds. "We also revised the outlook to stable from negative," S&P said. "The rating action reflects our view of clarification on how Jefferson County's November bankruptcy filing will affect pledged revenue," said Standard & Poor's credit analyst Brian Marshall. "None of the BJCC's debt was listed in the original bankruptcy filing, nor was the debt named in the county's bankruptcy resolution, and we understand that the county may in no way impair the pledged revenue," Mr. Marshall added. The rating also reflects S&P's view of the authority's: -- Pledged revenue that includes countywide lodging and beverage tax revenue, as well as payments in lieu of taxes (PILOTs) on all sales by the civic center at its facilities; -- Coverage of 3.05x (maximum annual debt service) MADS, net of payment pursuant to a contract to the Greater Birmingham Convention and Visitors Bureau, 1.5x MADS additional bonds test as well as a fully funded debt service reserve at 1x MADS; and -- Decreased likelihood of additional debt given that it can use excess revenue for operations. "The stable outlook reflects our anticipation that pledged revenue will continue to generate coverage levels in excess of MADS and experience no interruption from the Jefferson County bankruptcy proceedings," S&P said. BRAND ENERGY: S&P Affirms 'B' Corp. Credit Rating; Outlook Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Brand Energy & Infrastructure Services and revised the outlook to stable from negative. "The proposed $825 million first-lien facilities consist of a $700 million term loan facility, a $75 million revolving credit facility, and a $50 million fully funded letter-of-credit facility. We assigned our 'B' issue rating and '4' recovery rating (indicating our expectation of average [30%-50%] recovery in the event of payment default) to the company's proposed term loan and revolving credit facility and assigned our 'BB-' issue rating and '1' recovery rating (very high recovery of 90%-100%) to its $50 million letter-of-credit facility," S&P said. "At the same time, we raised our issue rating on Brand's $180 million Canadian tranche of the second-lien debt to 'BB-' from 'B+' and revised the recovery rating to '1' from '2'. We also affirmed our 'CCC+' issue-level rating on the company's $195 million U.S. second-lien term loan with a recovery rating of '6', indicating our expectation of negligible (0%-10%) recovery. The Canadian and U.S. second-lien debt together make up Brand's $375 million second-lien credit facility," S&P said. The ratings are subject to a review of final documentation. "The ratings on Brand reflect our view of the company's 'highly leveraged' financial profile and 'weak' business profile. The outlook revision indicates our expectation for sustained low double-digit EBITDA margins on slow demand recovery in its end- markets, our expectation leverage will fall to about 6x over the next 12 months and that its proposed refinancing extends maturities on a portion of its debt," said Standard & Poor's credit analyst Nishit Madlani. "Our financial risk assessment reflects Brand's high leverage and modest cash flow generation prospects over the next two years, and the overall business risk assessment reflects its exposure to volatile end-markets and competitive pricing." "We expect Brand to remain one of the largest providers of work access (i.e., scaffolding) and multicraft services in North America, with customers primarily in the energy sector--in particular, refineries--and, to a lesser extent, utilities. Although some of its end markets are cyclical, maintenance services (roughly two-thirds of revenues) tend to be more resilient to recessions. Contract terms between three and five years (although customers can cancel these on a relatively short notice) should continue to provide some earnings stability. Brand also has a commercial business, which is more project-focused, less recurrent, and accounts for only about 8%-10% of revenues," S&P said. "After being delayed during the economic downturn, maintenance and plant turnaround activity is slowly picking up across Brand's end markets. We expect demand for maintenance services in Brand's energy and industrial markets to modestly grow, at least in line with U.S. GDP, and for pricing to remain competitive. Brand's EBITDA margins have been improving over the past few quarters after they weakened as a result of price concessions that the company offered in response to competitive pressures. Also, some customers delayed maintenance capital expenditures over the past downturn. Given some improvement in demand, where possible, Brand has renegotiated some of its contracts, which we will continue to monitor with respect to our base-case assumptions for its operating performance over the next two years," S&P said. S&P's base case scenario assumptions for Brand include: -- Revenue will grow at about a mid-single-digit rate for the remainder of 2012 and 2013 mainly as a result of business wins in 2011 in its petrochemical end-markets and slow economic recovery driving low growth in its refining- and oil sands- related end-markets. -- EBITDA margins will rise at least by about 100 basis points over 2011 levels to about 10% or more over the next two years (after incorporating ongoing pricing pressure), because of overall sales recovery, absent any meaningful contract losses or productivity losses from potentially severe weather. -- Leverage will improve to about 6x or less over the next two years with low, but positive, free cash flow generation prospects over the cycle. "We view Brand's financial risk profile as highly leveraged, given pro forma leverage (including our adjustments) of more than 6.5x as of June 30, 2012, and our expectation for leverage to remain above 6x for the next 12 months. We expect some gradual improvement, although these metrics will likely remain at the lower end of our expectations," S&P said. "For the rating, we expect adjusted debt to EBITDA of about 6x or less and free operating cash flow (FOCF) to total debt in the low- single-digit area. The company's liquidity position has improved given it has extended its proposed revolver maturity to 2017 from February 2013. We expect Brand to maintain adequate liquidity and to take steps to extend or resolve its second-lien debt maturities over the next 12 months," S&P said. "Our stable outlook reflects our expectation for improved financial flexibility given that Brand is extending the maturity on its first-lien debt. Also, over the next 12 months we expect Brand to sustain recent improvements in EBITDA margins, given its recent ability to mitigate pricing pressures. Leverage should improve toward 6x, assuming industry activity picks up to historical levels, which is likely because customers can only generally delay maintenance work temporarily," S&P said. "We could consider a downgrade if the proposed transaction does not close or if we believe Brand would not reduce leverage toward 6x or less because of renewed pressure on EBITDA margins, leaving it vulnerable to eventual refinancing risks. A downgrade also could occur if Brand's liquidity profile deteriorates on end- markets that are weaker than we expect for a prolonged period, leading to customers delaying maintenance work over the near term, or if Brand loses maintenance projects altogether," S&P said. "An upgrade is unlikely over the next 12 months given our expectations for company's financial risk profile to remain highly leveraged. We believe the ultimate timing and terms for refinancing of Brand's second-lien debt, along with the increased likelihood that leverage will sustain around 5x or less, would be significant factors for any positive rating action on the company over the next year," S&P said. BRIER CREEK: Exclusive Plan Filing Period Extended to Dec. 4 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of North Carolina extended Brier Creek Corporate Center Associates Limited, et al.'s exclusive period to file a disclosure statement and proposed plan of reorganization to Dec. 4, 2012, and the Debtors' exclusive period to confirm a plan of reorganization to Feb. 4, 2013. About Brier Creek Corporate Brier Creek Corporate Center Associates Limited, Whitehall Corporate Center #4, LLC, and seven other related entities affiliates filed for Chapter 11 protection (Bankr. E.D.N.C. Lead Case No. 12-01855) on March 9, 2012. The Debtors own real property located in Wake County, North Carolina and Mecklenburg County, North Carolina. In most instances, the real property owned by the Debtors consists of land upon which is constructed commercial or industrial buildings consisting of office, service or retail space. The affiliates that also sought bankruptcy protection are: Brier Creek Office #4, LLC; Brier Creek Office #6, LLC; Service Retail at Brier Creek, LLC; Service Retail at Whitehall II L.P.; Shopton Ridge 30-C, LLC; Whitehall Corporate Center #4, LLC; Whitehall Corporate Center #5, LLC; and Whitehall Corporate Center #6, LLC. Brier Creek is a 106-acre development that is to have 2.8 million square feet of commercial space. Whitehall has 146 acres and will have 4 million square feet on completion. Brier Creek Corporate scheduled assets of $19,713,147 and liabilities of $18,086,183. Judge Stephani W. Humrickhouse oversees the case. Northen Blue, LLP, serves as counsel to the Debtors. C. Richard Rayburn, Jr. and the firm Rayburn Cooper & Durham, P.A., serve as special counsel. Grant Thornton LLP is the accountant. Bidencope & Associates was hired as appraiser. The petitions were signed by Terry Bradshaw, vice president. CAREY LIMOUSINE: Files for Chapter 11 in Delaware ------------------------------------------------- Carey Limousine L.A., Inc., filed a Chapter 11 petition (Bankr. D. Del. Case No. 12-12664) on Sept. 25, 2012. Carey Limousine, a subsidiary of Carey International, is one of the largest chauffeured transportation services companies in Southern California. The Debtor operates from a centralized location with convenient proximity to Los Angeles International Airport, Beverly Hills, Downtown Los Angeles, and other centers of business and tourism in Southern California. The Debtor has 17 employees and utilized 30 independent owner-operators. Seventeen farm-out companies, providing chauffeurs, fulfill overflow customer requests. In light of an adverse arbitration ruling in the amount of $4.52 million issued in regard to 16 independent operators, as well as continued uncertainty in California law regarding independent contractors, the Debtor has taken steps in transition its independent-operator model to an employee model. On Sept. 12, the Debtor commenced the process, sending notices that they would terminate operator agreements and that effective Oct. 13, they would be transitioned to employees. Mitchell Lahr, director and vice president of Carey Limousine, relates the Debtor is seeking Chapter 11 protection to, among other things, provide breathing room to manage through certain fixed and potential liabilities that arose, or that may arise, from certain alleged claims of its independent operators with respect to assertions that they should have been classified as employees and, therefore, should have been paid certain wage and other benefits in addition to the compensation agreed to in their independent operator agreements. The Debtor estimated just under $500,000 in assets and at least $100 million in liabilities. The Debtor said it owes $146.6 million in term loans provided by lenders led by Highland Financial Corp., as arranger and NexBank, SSB, as administrative agent. The Debtor intends to continue in the possession of its properties and the management of its business as a debtor-in-possession. In order to enable the Debtor to operate efficiently postpetition and to avoid the adverse effects of a Chapter 11 filing, the Debtor has requested various types of relief in "first day" applications and motions. The Debtor is seeking a 60-day extension of the deadline to file its schedules of assets and liabilities and its statement of financial affairs. It also seeks to pay prepetition wages and benefits of its employees, and prepetition claims of drivers and travel agents. The Debtor also filed applications to hire Young, Conaway, Stargatt & Taylor, as counsel; Willkie Farr & Gallagher LLP, as bankruptcy co-counsel; and Kurtzman Carson Consultants LLC as the claims and notice agent. CENTERPLATE INC: Moody's Assigns 'B3' Corp. Family Rating --------------------------------------------------------- Moody's Investors Service assigned Corporate Family and Probability of Default Ratings of B3 to Centerplate, Inc. on its proposed $550 million leveraged buyout. Moody's also assigned B2 ratings to the proposed $342 million senior secured credit facilities, consisting of a $267 million term loan and a $75 million revolver. The rating outlook is stable. Proceeds from the credit facilities, $115 million of proposed mezzanine notes (unrated by Moody's) and a $188 million common equity infusion will fund Centerplate's leveraged buyout by Olympus Partners from current owner Kohlberg & Company, LLC, and refinance existing debt. The transaction will improve Centerplate's interest coverage, however the B3 Corporate Family Rating also considers the increased leverage following the LBO and the cyclicality of the company's earnings within the competitive concessions services business. Further, substantial improvement in credit metrics is unlikely in the context of Centerplate's aggressive growth plans and financial policy. Assignments: Issuer: Centerplate, Inc. -- Corporate Family Rating of B3 -- Probability of Default Rating of B3 -- Proposed $75 million senior secured revolving credit facility due 2017 at B2 (LGD3, 40%) -- Proposed $267 million senior secured term loan due 2018 at B2 (LGD3, 40%) -- Stable rating outlook The ratings are contingent upon the receipt and review of final documentation. All ratings of predecessor Centerplate, including its B3 CFR and ratings on existing bank debt, will be withdrawn upon completion of the proposed transaction and repayment of existing debt. Ratings Rationale The B3 CFR reflects Centerplate's leveraged balance sheet, aggressive and acquisitive financial philosophy, relatively small scale, and the cyclical and highly competitive nature of the concession services business. Centerplate's broad portfolio of reportedly over 250 customer contracts, high contract renewal rates and lack of substantive near-term contract expirations support the rating. The rating also incorporates the company's adequate liquidity profile. The B2 ratings on the proposed senior secured credit facilities reflect their first priority lien on substantially all US assets, a pledge of 65% of the voting stock of all material foreign subsidiaries, and upstream guarantees by all existing and future domestic wholly owned subsidiaries. The ratings also benefit from the loss absorption provided by the $115 million mezzanine notes due June 2019 (unrated by Moody's). The stable outlook anticipates modest near-term growth in revenue and EBITDA driven by new contract signings and expansion into adjacent market segments. The outlook incorporates an expectation of limited debt repayment, and the potential use of cash flow and revolver borrowing capacity for acquisitions and growth capital expenditures. The outlook also assumes that the company will maintain an adequate liquidity position to support operations. The ratings could be pressured by: (i) declining profitability due to contract losses, cost increases or the cancellation of several major clients; (ii) liquidity deterioration; or (iii) a change to more aggressive financial policies. Specifically, the ratings could be downgraded if Moody's expects sustained negative free cash flow generation or EBITDA less capital expenditures to interest expense of less than 1 time. Positive rating momentum could develop if the company demonstrates a commitment to a more conservative financial policy. Specifically, the ratings could be upgraded if EBITDA less capital expenditures to interest expense and free cash flow to debt are sustained over 1.6 times and 5%, respectively. The principal methodology used in rating Centerplate was the Global Business & 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. CGGVERITAS SERVICES: Moody's Reviews Ratings for Downgrade ---------------------------------------------------------- Moody's Investors Service has placed all the ratings of Compagnie Generale De Geophysique-Veritas ("CGGVeritas") and CGGVeritas Services, Inc. under review for downgrade, following CGGVeritas' announcement of the acquisition of the Geoscience division of Fugro N.V. (unrated) excluding multi-client library and ocean bottom nodes businesses. Ratings Rationale The EUR1.2 billion transaction, which has been approved by the Boards of Directors of both companies, is anticipated to be financed by 1/3 equity issuance and 2/3 with debt and proceeds from the formation of a Seabed Joint-Venture. Subject to the financing proceeding as outlined, Moody's currently anticipates that any downgrade of CGG Veritas' CFR and PDR would be limited to one notch. The ratings of existing debt will be adjusted in line with Moody's loss-given default approach to the ultimate capital structure, depending on the amounts and terms of new notes. The rating action reflects Moody's expectation that the incremental debt associated with the acquisition may result in through-the-cycle leverage remaining (5 years average of leverage calculated as Moody's adjusted net Debt to EBITDA less Multiclient Amortization) materially above 3.0x and credit metrics that may no longer be appropriate for the Ba2 rating. Moody's review will focus on CGGVeritas' new business profile and the integration risks associated with the transaction, the capital structure, including terms of any debt issuance, and deleveraging profile, as well as on liquidity. Moody's would expect to conclude Moody's review after the close of the transaction, which is targeted before year-end. The principal methodology used in rating Compagnie Generale De Geophysique-Veritas anf CGGVeritas Services, Inc. was the Global Oilfield Services Rating Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. CHRYSLER LLC: Fiat Sues VEBA Trust Over Call Option --------------------------------------------------- Giada Zampano and Christina Rogers, writing for Dow Jones Newswires, report that Italy's Fiat SpA on Wednesday said it asked a U.S. court to resolve a dispute over the price it must pay a retiree health care trust for a 3.3% stake in Chrysler Group LLC after the two sides differed on the terms of their contract. The report recounts Fiat said in July it would exercise a call option to raise its stake in Chrysler to 61.8% from 58.5%, tightening its control of its U.S. partner. A purchase would reduce the stake held by the trust to 38.2% from 41.5%. According to Dow Jones, in the lawsuit filed in Delaware Chancery Court, Fiat said it calculated the purchase price for the shares at $155 million and offered to acquire the shares for that price on July 11. The lawsuit claims the voluntary employee beneficiary association has refused to turn over the shares, in breach of the original agreement. Dow Jones relates Fiat Chief Executive Sergio Marchionne said in a statement the Delaware Chancery Court's assistance is needed "in the application of a specific pricing formula which was agreed in 2009 and as such unrelated to the value of Chrysler today." According to Dow Jones, the UAW trust, in a statement, said: "Brock Fiduciary Services LLC is the independent fiduciary that handles all matters related to the VEBA's holdings within Chrysler/Fiat. We respect the process and will be making no public statement." Chrysler declined to comment, referring questions to Fiat. According to the report, Fiat is increasingly relying on Chrysler as Fiat sales in Europe wilt while the U.S. auto maker continues to rebound from its bankruptcy in 2009. About Chrysler Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. As of Dec. 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat acquired a 20% equity interest in Chrysler Group as part of the deal. The U.S. and Canadian governments provided Chrysler with $4.5 billion to finance its bankruptcy case. Those loans were repaid with the proceeds of the bankruptcy estate's liquidation. The Debtor changed its corporate name to Old CarCo following the sale. CHRYSLER LLC: Old Creditors Ask 2nd Circ. to Revive Daimler Suit ---------------------------------------------------------------- Richard Vanderford at Bankruptcy Law360 reports that a trust for Chrysler Corp. bankruptcy creditors on Tuesday asked the Second Circuit to revive a lawsuit that alleges German automaker Daimler AG rigged a deal to spinoff the company, saying the lower courts jumped to conclusions without looking at facts. Bankruptcy Law360 relates that a lawyer for creditors of Old Carco LLC, a Chrysler LLC castoff created after the company was reorganized in bankruptcy, told a three-judge panel at oral arguments that lower courts skipped ahead of a necessary factual inquiry when they dismissed a suit against Daimler. About Chrysler Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. As of Dec. 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat acquired a 20% equity interest in Chrysler Group as part of the deal. The U.S. and Canadian governments provided Chrysler with $4.5 billion to finance its bankruptcy case. Those loans were repaid with the proceeds of the bankruptcy estate's liquidation. The Debtor changed its corporate name to Old CarCo following the sale. CHRYSLER LLC: 6th Circ. Nixes Most of Former Execs' Benefits Suit ----------------------------------------------------------------- Abigail Rubenstein at Bankruptcy Law360 reports that the Sixth Circuit on Tuesday upheld the dismissal of the bulk of a putative class action lodged by former Chrysler executives over retirement benefits they claim were lost during the automaker's bankruptcy due to mismanagement, but revived an age discrimination claim. In an unpublished opinion, a Sixth Circuit panel affirmed a lower court's ruling that the former executives' state law breach of fiduciary duty, promissory estoppel and fraud claims were preempted by the Employee Retirement Income Security Act, according to Bankruptcy Law360. About Chrysler Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. As of Dec. 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat acquired a 20% equity interest in Chrysler Group as part of the deal. The U.S. and Canadian governments provided Chrysler with $4.5 billion to finance its bankruptcy case. Those loans were repaid with the proceeds of the bankruptcy estate's liquidation. The Debtor changed its corporate name to Old CarCo following the sale. CIRCUS AND ELDORADO: Wants Exclusivity Extended to Jan. 14 ---------------------------------------------------------- BankruptcyData.com reports that Circus and Eldorado Joint Venture filed with the Bankruptcy Court a motion to extend the exclusive period during which the Company can file a Chapter 11 plan and solicit acceptances thereof through and including Jan. 14, 2013 and March 13, 2013, respectively. The Court scheduled an Oct. 22, 2012 hearing on the matter. About Circus and Eldorado Circus and Eldorado Joint Venture and Silver Legacy Capital Corp. filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case Nos. 12-51156 and 12-51157) on May 17, 2012. Circus and Eldorado Joint Venture owns and operates the Silver Legacy Resort Casino, a 19th century silver mining themed hotel, casino and entertainment complex located in downtown Reno, Nevada. The casino and entertainment areas at Silver Legacy are connected by skyway corridors to the neighboring Eldorado Hotel & Casino and the Circus Circus Hotel and Casino, each of which are owned by affiliates of the Debtors. Together, the three properties comprise the heart of the Reno market's prime gaming area and room base. Silver Legacy Capital is a wholly owned subsidiary of the Joint Venture and was created and exists for the sole purpose of serving as a co-issuer of the mortgage notes due 2012. SLCC has no operations, assets or revenues. Eldorado Hotel & Casino and Circus Circus Hotel and Casino are not debtors in the Chapter 11 cases. The Company did not make the required principal payment of its 10.125% mortgage notes on the maturity date of March 1, 2012. The company also elected not to make the scheduled interest payment. As a result, an aggregate of $142.8 million principal amount of Notes were outstanding and accrued interest of $7.23 million on the Notes, as of March 1, 2012, is due and payable. The Debtors have entered into a Restructuring Support Agreement with Capital Research and Management Company, a holder of a substantial portion of the mortgage notes. A copy of the RSA dated March 15, 2012, is available for free at http://is.gd/diDPh3 The RSA contemplates a proposed plan will be filed no later than June 1, 2012. The plan will contain creditor treatments that have already been negotiated with and agreed to by creditor constituents. The Debtors will seek approval of the explanatory disclosure statement within 45 days after the Petition Date and obtain confirmation of the Plan 60 days later. Judge Bruce T. Beesley presides over the case. Paul S. Aronzon, Esq., and Thomas P. Kreller, Esq., at Milbank, Tweed, Hadley & McCloy LLP; and Sallie B. Armstrong, Esq., at Downey Brand LLP, serve as the Debtors' counsel. The Debtors' financial advisor is FTI Consulting Inc. The claims agent is Kurtzman Carson Consultants LLC. The Bank of New York Mellon Trust Company, N.A., the trustee for the Debtors' 10-1/8% Mortgage Notes due 2012, is represented by Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury Winthrop Shaw Pittman LLP. Circus and Eldorado Joint Venture disclosed $264,649,800 in assets and $158,753,490 in liabilities as of the Chapter 11 filing. The petitions were signed by Stephanie D. Lepori, chief financial officer. The Plan dated June 1, 2012, pays much of its debt in cash and the balance with new secured liens. August B. Landis, Acting U.S. Trustee for Region 17, appointed three creditors to serve in the Official Committee of Unsecured Creditors in the Debtors' Chapter 11 cases. Stutman, Treister & Glatt Professional Corporation represents the Committee. CLAIRE'S STORES: Closes Offering of $625 Million Senior Notes ------------------------------------------------------------- Claire's Stores, Inc., closed its offering of $625 million aggregate principal amount of additional 9.00% senior secured first lien notes due 2019. The notes were sold at 102.5% of the aggregate principal amount, resulting in gross proceeds of $640,625,000. The notes are of the same series as the Company's outstanding $500 million aggregate principal amount of 9.00% senior secured first lien notes due 2019. The terms of the notes, other than their issue date and issue price, are identical to the previously issued notes. As a result of the closing of this offering, the aggregate principal amount of the Company's 9.00% senior secured first lien notes due 2019 outstanding is $1.125 billion. The Company used the net proceeds of the issuance of the notes, together with cash on hand, to repay in full the term loan indebtedness under its senior secured credit facility. In addition, the Company replaced its existing senior secured revolving credit facility with an amended and restated $115.0 million five-year senior secured revolving credit facility. About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. The Company's balance sheet at July 28, 2012, showed $2.72 billion in total assets, $2.78 billion in total liabilities, and a $61.01 million stockholders' deficit. * * * Claire's Stores, Inc., carries a Caa2 Corporate Family and Probability of Default ratings from Moody's Investors Service and a 'B-' Corporate Credit Rating from Standard & Poor's Ratings Services. CLIFFORD JOESEPH WOERNER: Court Denies Objection to Exemptions -------------------------------------------------------------- Bankruptcy Judge Craig A. Gargotta denied objections filed by Texas Skyline, Ltd., Pecos & 15th, Ltd., and Skyline Interests, LLC the claim of exemptions of debtors Clifford Joeseph Woerner and Gail Suzanne Woerner. The Court held that Skyline fails to meet its burden of proof. Skyline objects to almost all of the Debtors' claimed exemptions but does not specifically address what is wrong with any particular claim. Apart from noting the Debtors' multiple amendments to the schedules and "testimony that debtors hid assets to avoid collection by creditors", Skyline offers no evidence that any exemption was improperly claimed or valued. At most, Skyline's Objection impeaches the Debtors' valuation of the exemptions at issue, but there is no competent evidence "demonstrat[ing] a higher valuation[.]" Skyline therefore fails to meet its burden of proof and the Objection should be denied. Austin, Texas-based Clifford Joseph Woerner, aka C.J. Woerner and Woerner Interests, and Gail Suzanne Woerner, filed for Chapter 11 bankruptcy (Bankr. W.D. Tex. Case No. 10-11365) on May 13, 2010. Barbara M. Barron, Esq. -- bbarron@bnpclaw.com -- at Barron & Newburger, P.C., served as the Debtors' counsel. In the joint petition, the Woerners estimated $1 million to $10 million in assets and debts. A list of the Woerners' 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/txwb10-11365.pdf The case was later converted to Chapter 7 on April 20, 2011. The Debtors filed original schedules on May 18, 2012, and have since amended the schedules five times. The omission of several items of value that appeared on subsequent amended schedules was the basis for conversion to Chapter 7. The most recent amended schedule was filed on May 21, 2012. Skyline filed its Objection on June 20, 2012. The Debtors did not file a response to the objection but opposed the objection at hearing. A copy of the Court's Sept. 25, 2012 Memorandum Opinion and Order is available at http://is.gd/enCL1Ifrom Leagle.com. CONTEC HOLDINGS: Has Loan Approval; Prepack Plan Hearing on Oct. 4 ------------------------------------------------------------------ Bain Capital Partners' Contec Holdings Ltd. won final approval for a $35 million bankruptcy loan that would finance its prepackaged plan, as well as for a deal that brings a group of the company's creditors on board with its plan to exit Chapter 11 swiftly. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the pivotal day in bankruptcy court will take place at the confirmation hearing on Oct. 4, when U.S. Bankruptcy Judge Kevin J. Carey will decide whether to approve the reorganization plan where $201 million in senior secured debt will be exchanged for 80% of the new equity and $27.5 million in new second lien notes. Contec was given interim approval for a $20 million loan in early September. The Bloomberg report discloses the plan was accepted by the required percentages of affected creditors before the Chapter 11 filing. Unsecured trade suppliers are being paid in full. About Contec Holdings Headquartered in Schenectady, New York, Contec Holdings Ltd. -- http://www.gocontec.com/-- is the market leader in the repair and refurbishment of customer premise equipment for the cable industry. The Company repairs more than 2 million cable set top boxes annually, while also providing logistical support services for over 12 million units of cable equipment annually. With substantial operations in the United States and Mexico, the Debtors earned revenues of approximately $153.6 million in 2011, and as of July 28, 2012, the Debtors directly employed over 2,300 people in North America, 72% of which are unionized. Contec Holdings, Ltd., and its affiliates on Aug. 29, 2012 sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12437) with a plan of reorganization that has the support of senior lenders and noteholders. Ropes & Gray LLP, serves as bankruptcy counsel to the Debtors; Pepper Hamilton LLP is the local counsel; AP Services LLC, is the restructuring advisor; Moelis & Company is the investment banker; and Garden City Group is the claims agent. CORMEDIX INC: Gets Extension to Regain Compliance ------------------------------------------------- CorMedix Inc. held the initial financial closing on Sept. 20, 2012, of its private placement of Units consisting of (i) a one- year $1,000 aggregate principal amount 9% Senior Convertible Note, convertible into shares of common stock, par value $0.001 per share, at a conversion price of $0.35 per Note, and (ii) a five- year redeemable Warrant, to purchase 2,500 shares of Common Stock, to certain accredited investors pursuant to a Subscription Agreement. The Units are being offered on a "reasonable efforts, all-or-none" basis as to 500 Units for a minimum amount of $500,000, and, thereafter on a "reasonable efforts" basis as to the remaining 2,500 Units for a maximum amount of $3,000,000. At the initial closing, the Company sold 850 Units for a total gross amount of $850,000. After the initial closing, the Company may sell up to the Maximum Amount and further closings may be conducted for the sale of the Units until Nov. 14, 2012. Proceeds from the 2012 Offering will be used by the Company for marketing, manufacturing, rent and utilities, licensing obligations, payroll and working capital and general corporate purposes. "We are happy to disclose the initial closing mainly through our management, directors and existing shareholders," said Rich Cohen, Interim CEO and Interim CFO. Subsequently, on Sept. 21, 2012, the NYSE Amex notified the Company that the NYSE Amex was granting the Company an extension until Jan. 31, 2013 to regain compliance with the continued listing standards of the NYSE Amex. As a result, the NYSE-Amex is continuing the Company's listing pursuant to the extension. The Company will be subject to periodic review by the NYSE-Amex during the extended plan period. Failure to make progress consistent with the plan or to regain compliance with continued listing standards by the end of the extension period could result in the Company being delisted from the NYSE-Amex. CorMedix will be subject to periodic review by the NYSE-Amex Staff during the extension period. CorMedix had earlier received notice on June 27, 2012 from the NYSE Amex LLC that the NYSE-Amex had accepted the CorMedix plan to regain compliance with continued listing standards of the NYSE- Amex. CorMedix's plan was submitted on May 17, 2012 in response to a letter from the NYSE-Amex which informed CorMedix it was below certain of the NYSE-Amex's continued listing standards due to financial impairment as set forth in Section 1003(a)(iv) of the NYSE-Amex Company Guide. CorMedix was afforded the opportunity to submit a plan to regain compliance to the NYSE-Amex and on May 17, 2012 presented its plan to the NYSE-Amex. On June 27, 2012 the NYSE-Amex notified CorMedix that it accepted the plan to regain compliance and granted CorMedix an extension until August 22, 2012 to regain compliance with the continued listing standards. About CorMedix CorMedix Inc. -- http://www.cormedix.com/-- is a pharmaceutical company that seeks to in-license, develop and commercialize therapeutic products for the prevention and treatment of cardiac and renal dysfunction, also known as cardiorenal disease. CorMedix most advanced product candidate: CRMD003 (Neutrolin(R)) for the prevention of catheter related bloodstream infections and maintenance of catheter patency in tunneled, cuffed, central venous catheters used for vascular access in hemodialysis patients. CORDILLERA GOLF: Reaches Settlement With Lender and Members ----------------------------------------------------------- Stephanie Gleason at Dow Jones' DBR Small Cap reports that Cordillera Golf Club has reached an agreement with its lender, creditors and club members that provides a framework for resolving a class-action lawsuit and a path forward in bankruptcy but requires Cordillera to sell its property. About Cordillera Golf Cordillera Golf Club, LLC, filed for protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 12-11893) on June 26, 2012, amid lower membership rates and tensions with current members. The Debtor owns an exclusive 730-acre four-course golf club at the Cordillera resort community in Edwards, Colorado. The club is located at the 7,000-acre Cordillera development, which has 1,087 residential lots. Non-equity club membership is open to community residents. The club has three golf courses, a Dave Pelz designed short course, five swimming pools, and tennis courts. The membership plan provides that there will be no more than 1,085 golf memberships and up to 100 social memberships. Half of all property owners within Cordillera are club members. David A. Wilhelm, manager of CGH Manager LLC, manager, signed the Chapter 11 petition. Mr. Wilhelm acquired 100% interest in the Debtor in 2009 following an arbitration that stemmed from revelations that the then owners of the 70% interests had diverted funds away from the Debtor's operations. In the petition, the Debtor estimated $10 million to $50 million in assets and debts, including secured debt of $12.7 million owed to Alpine Bank and a $7.5 million secured claim by Mr. Wilhelm. Delaware Bankruptcy Judge Christopher S. Sontchi presides over the case. Lawyers at Young, Conaway, Stargatt & Taylor and Foley & Lardner LLP serve as the Debtor's counsel. Omni Management Group LLC serves as the Debtor's claims agent. On July 16, 2012, the Delaware Court granted the request of certain club members to transfer the venue of the case to the Bankruptcy Court in Colorado. The case has been endorsed to Hon. A. Bruce Campbell in Denver (Bankr. D. Colo. Case No. 12-24882). An official committee of unsecured creditors has been appointed in the case. The Committee members consist of various homeowner and trade creditors of the Debtor. All members have Colorado addresses. The Committee is represented by Munsch Hardt Kopf & Harr, PC as counsel. Certain homeowners also have retained separate counsel, Michael S. Kogan, Esq., at Kogan Law Firm, APC. Secured lender, Alpine Bank in Vail, Colo., is represented by lawyers at Ballard Spahr LLP. COTT CORP: S&P Lifts Corp. Credit Rating to 'B+' on Profitability ----------------------------------------------------------------- Standard & Poor's Ratings Services raised its long-term corporate credit rating on Mississauga, Ont.-based Cott Corp. to 'B+' from 'B'. The outlook is stable. "At the same time, we raised our debt rating on wholly owned U.S. subsidiary Cott Beverages Inc.'s senior unsecured notes to 'B+' from 'B'. The '4' recovery rating on the debt is unchanged, indicating our expectation of average (30%-50%) recovery in the event of default," S&P said. "The upgrade reflects what we view as Cott's improved business risk profile to weak from vulnerable stemming from increased profitability and completion of the majority of the Cliffstar Corp. integration," said Standard & Poor's credit analyst Lori Harris. "Cott has largely completed the integration of Cliffstar, which it acquired in 2010 for US$569 million. Completion of the Cliffstar integration will allow management to focus on continuing to increase operating efficiencies and new product development--two key inputs to ongoing margin improvement," S&P said. "The ratings on Cott reflect Standard & Poor's view of the company's weak business risk profile and aggressive financial risk profile (as our criteria define the terms). We base our business risk assessment on the company's small size in a sector dominated by companies with substantially greater financial resources and market presence, customer concentration, and susceptibility to commodity cost swings. We believe these factors are partially offset by leading market positions in private label take-home carbonated soft drinks in the U.S., the U.K., and Canada, as well as shelf stable juices in the U.S. Cott's financial risk profile is based on the potential volatility of earnings and credit metrics due to competitive actions or changes in key commodity costs, partially offset by the company's adequate credit protection measures and positive free cash flow," S&P said. "The stable outlook is based on our belief that Cott's operating performance and credit protection measures will be in line with our expectations in the medium term, including adjusted debt to EBITDA in the 3x area. We could consider raising the ratings if Cott demonstrates continued strengthening of its market position to an extent that changes our view of the company's business risk profile, while at the same time improving its operating performance despite the potential for increased competitive activity, higher commodity prices, and a decline in its business with Wal-Mart, and maintaining leverage below 3x on a sustainable basis. Alternatively, we could lower the ratings if the company's operating performance falls below our expectations or if Cott's financial flexibility and credit ratios weaken, resulting in adjusted debt to EBITDA above 4x," S&P said. CPI CORP: Unit to Sell Real Estate to Worldwide Ventures -------------------------------------------------------- Consumer Programs, Incorporated, a wholly owned subsidiary of CPI Corp., entered into a Purchase and Sale Agreement with Worldwide Ventures, Incorporated, to sell real estate located at 11001 Park Charlotte Boulevard in Charlotte, North Carolina, along with two parcels of land also located in Charlotte. A copy of the Agreement is available for free at http://is.gd/ys2YsX About CPI Corp. Headquartered in St. Louis, Missouri, CPI Corp. provides portrait photography services at more than 2,500 locations in the United States, Canada, Mexico and Puerto Rico and offers on location wedding photography and videography services through an extensive network of contract photographers and videographers. For the 24 weeks ended July 21, 2012, the Company reported a net loss of $39.93 million on $123.24 million of net sales. The Company reported a net loss of $56.86 million for the fiscal year ended Feb. 4, 2012, compared with net income of $11.90 million for the fiscal year ended Feb. 5, 2011. KPMG LLP, in St. Louis, Missouri, issued a "going concern" qualification on the consolidated financial statements for the period ended Feb. 4, 2012, noting that the Company has suffered a significant loss from operations, is not in compliance with the financial covenants under its credit agreement, and has a net capital deficiency, all of which raise substantial doubt about its ability to continue as a going concern. The Company's balance sheet at July 21, 2012, showed $61.04 million in total assets, $159.63 million in total liabilities, and a $98.59 million total stockholders' deficit. Bankruptcy Warning "Management is implementing plans to improve liquidity through improvements to results from operations, store closures, cost reductions and operational alternatives," the Company said in its quarterly report for the period ended July 21, 2012. "However, there can be no assurance that we will be successful with our plans or that our future results of operations will improve. If sales trends do not improve, our available liquidity from cash flows from operations will be materially adversely affected. There can be no assurance that we will be able to improve cash flows from operations, or that we will be able to comply with the terms of the Second Amendment. Therefore, there can be no guarantee that our existing sources of cash and our future cash flows from operations will be adequate to meet our liquidity requirements, including cash requirements that are due under the Credit Agreement and that are needed to fund our business operations. If we are unable to address our liquidity shortfall or comply with the terms of our Credit Agreement, as amended, then our business and operating results would be materially adversely affected, and the Company may then need to curtail its business operations, reorganize its capital structure, or liquidate." The Company further stated that should it not be able to sell its business by Dec. 31, 2012, it could be forced to seek additional financing, which may not be available, curtail its business operations or reorganize its capital structure, or be forced into bankruptcy. DCB FINANCIAL: Files Amendment No. 4 to Form S-1 Prospectus ----------------------------------------------------------- DCB Financial Corp. filed with the U.S. Securities and Exchange Commission a pre-effective amendment no. 4 to the Form S-1 registration statement relating to the distribution of non- transferable rights to subscribe for and purchase up to 1,422,536 common shares to persons who owned the Company's common shares as of 5:00 p.m., Eastern Time, on the record date, [ ] , 2012. The Company has entered into agreements with certain standby investors, pursuant to which those standby investors have agreed to purchase, in a private offering to be closed after the conclusion of the rights offering, either a minimum number of common shares, or a certain number of the remaining common shares that are not purchased through the exercise of rights, or both. No standby investor will own 10% or more of the common shares after completion of the rights offering and private offering. The maximum number of common shares to be issued by the Company in the rights offering and the subsequent private offering will not exceed 3,475,000 common shares. There is no minimum amount required for the Company to complete the rights offering. Even if the rights offering is not completed, at least 920,884 shares, or $3.5 million, will be raised through commitments to purchase in the private offering. This approximately $3.5 million does not include the investment of certain of the standby investors who have made their commitment to purchase shares subject to the Company raising at least $13 million, although these purchasers may choose to purchase shares even if $13 million is not raised. In order to reach a total of $13 million through the rights offering and the private offering, 3,421,053 shares must be sold. The Company has obtained commitments to sell a minimum of 2,052,464 shares through the private offering, which includes the five standby investors whose commitments are contingent upon the Company's selling at least $13 million of shares, and an additional 817,277 shares will be purchased by standby investors if they remain unsold following the rights offering. If the standby investors purchase their total commitment of 2,869,741 shares, only 551,312 shares would need to be sold through the rights offering in order to raise $13 million. All common shares sold in the rights offering or pursuant to agreements with standby investors will be at the $3.80 subscription price. The Company's common shares are quoted on the Over-the-Counter Bulletin Board under the trading symbol "DCBF.OB." A copy of the amended prospectus is available for free at: http://is.gd/YVEREx About DCB Financial DCB Financial Corp. is a financial holding company headquartered in Lewis Center, Ohio. The Corporation has one wholly-owned subsidiary bank, The Delaware County Bank and Trust Company (the "Bank"). The Corporation also has two additional wholly owned subsidiaries, DCB Title and DCB Insurance Services LLC. DCB Title provides standard real estate title services, while DCB Insurance Services LLC provides a variety of insurance products. However, neither nonbank subsidiary is material to the financial results of the Corporation. The Bank has one wholly-owned subsidiary, ORECO, which is used to process other real estate owned. The Corporation was incorporated under the laws of the State of Ohio in 1997, as a financial holding company under the Bank Holding Company Act of 1956, as amended, by acquiring all outstanding shares of the Bank. The Corporation acquired all such shares of the Bank after an interim bank merger, consummated on March 14, 1997. The Bank is a commercial bank, chartered under the laws of the State of Ohio, and was organized in 1950. The Bank provides customary retail and commercial banking services to its customers, including checking and savings accounts, time deposits, IRAs, safe deposit facilities, personal loans, commercial loans, real estate mortgage loans, installment loans, trust and other wealth management services. The Bank also provides cash management, bond registrar and paying agent services for commercial and public unit entities. Through its subsidiary Datatasx, the Bank provided data processing and other bank operational services to other financial institutions. Those services were discontinued in September 2011, and were not a significant part of operations or revenue. In October 2010, the Corporation's wholly-owned bank subsidiary entered into a Consent Agreement with the FDIC which requires that Tier-1 and Total Risk Based Capital percentages reach 9.0% and 13.0% respectively. As of March 31, 2012, the Bank's capital ratios, as previously noted, were not at these levels. The Corporation and its subsidiaries meet all published regulatory capital requirements. The ratio of total capital to risk-weighted assets was 10.3% at March 31, 2012, while the Tier 1 risk-based capital ratio was 6.7%. As reported in the TCR on April 5, 2012, Plante & Moran PLLC, in Columbus, Ohio, said DCB's bank subsidiary is not in compliance with revised minimum regulatory capital requirements under a formal regulatory agreement with the banking regulators. "Failure to comply with the regulatory agreement may result in additional regulatory enforcement actions." The Company's balance sheet at June 30, 2012, showed $510.70 million in total assets, $475.51 million in total liabilities and $35.19 million in total stockholders' equity. DIGITAL DOMAIN: Williams, Blaise Bid for Rights on "Tembo" Film --------------------------------------------------------------- Peg Brickley, writing for Dow Jones Newswires, reports that directors and producers Chuck Williams and Aaron Blaise have put in a bid on rights to "The Legend of Tembo," an animated feature that was to have made Digital Domain's name. They're also in talks with Galloping Horse, the Beijing company that, along with Reliance MediaWorks LLC, plunked down $30.2 million for Digital Domain's special-effects business at a bankruptcy auction. The report notes Galloping Horse already has put $5 million behind the movie's development, and Messrs. Williams and Blaise are counting on the joint venture stepping up to help revive Digital Domain's animated feature film venture. According to Dow Jones, "The Legend of Tembo," the story of an elephant hauled far from his African home to go to war, was one month from going into production when restructuring specialists at FTI Consulting told Florida employees who had arrived for work one day that they had two hours to grab their possessions and get out. According to the report, at last week's bankruptcy court hearing, FTI's Michael Katzenstein portrayed Digital Domain's foray into the business of producing animated films as the very expensive and elaborate folly of a company that had slogged along nicely for years producing special effects for movies like "Titanic." The report says Mr. Katzenstein complained "Tembo" absorbed $13 million of the company's money, helping to trigger financial and human tragedy. The report notes Messrs. Williams and Blaise disagree, saying special effects is a thin-margin service business, and that the real money is in animated features, with nine out of 10 that get wide release in the U.S. turning a profit. No one could reasonably expect a profit from Digital Domain's new studio for years, they said, and the spending on "Tembo" was within industry norms. According to the report, Mr. Blaise said the normal budget for a top-flight animated feature film is $80 million to $100 million. It takes three or four years to produce a quality animated film, but they're money pits until they're on the screen. About Digital Domain Digital Domain Media Group, Inc. -- http://www.digitaldomain.com/ -- engages in the creation of original content animation feature films, and development of computer-generated imagery for feature films and transmedia advertising primarily in the United States. Digital Domain Media Group, Inc. and 13 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on Sept. 11, 2012, to sell its business for $15 million to Searchlight Capital Partners LP. The Debtors have also sought ancillary relief in Canada, pursuant to the Companies' Creditors Arrangement Act in the Supreme Court of British Columbia, Vancouver Registry. Port St. Lucie, Florida-based Digital Domain disclosed assets of $205 million and liabilities totaling $214 million. DDMG also announced that it has entered into a purchase agreement with Searchlight Capital Partners L.P. to acquire Digital Domain Productions Inc. and its operating subsidiaries in the United States and Canada, including Mothership Media, subject to the receipt of higher and better offers and Court approval. DDPI and Mothership, with studios in California and Vancouver, are focused on creating digital visual effects, CG animation and digital production for the entertainment and advertising industries and are led by recently promoted Chief Executive Officer Ed Ulbrich. Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. An official committee of unsecured creditors has been appointed in the case. The panel has tapped as bankruptcy counsel William D. Sullivan, Esq., and Seth S. Brostoff, Esq., at Sullivan Hazeltine Allinson LLC; and H. Jeffrey Schwartz, Esq., and Bennett S. Silverberg, at Brown Rudnick LLP. DIGITAL DOMAIN: Brower Piven Starts Investors' Class Suit --------------------------------------------------------- Brower Piven discloses that a class action lawsuit has been commenced in the United States District Court for the Southern District of Florida on behalf of all persons and/or entities who purchased Digital Domain Media Group, Inc. common stock from Nov. 18, 2011 through and including Sept. 6, 2012 and on behalf of members of the Class that purchased or otherwise acquired DDMG common stock in or traceable to the Company's initial public offering which commenced on or about Nov. 18, 2011. The firm announced that if you have suffered a net loss for all transactions in Digital Domain Media Group, Inc. common stock during the Class Period, you may obtain additional information about this lawsuit and your ability to become a lead plaintiff by contacting Brower Piven at http://www.browerpiven.com,by e-mail at hoffman@browerpiven.com, by calling 410/415-6616, or at Brower Piven, A Professional Corporation, 1925 Old Valley Road, Stevenson, Maryland 21153. Attorneys at Brower Piven have combined experience litigating securities and class action cases of over 60 years. No class has yet been certified in the above action. Members of the Class will be represented by the lead plaintiff and counsel chosen by the lead plaintiff. If you wish to choose counsel to represent you and the Class, you must apply to be appointed lead plaintiff no later than Nov. 19, 2012 and be selected by the Court. The lead plaintiff will direct the litigation and participate in important decisions including whether to accept a settlement and how much of a settlement to accept for the Class in the action. The lead plaintiff will be selected from among applicants claiming the largest loss from investment in the Company during the Class Period. You are not required to have sold your shares to seek damages or to serve as a Lead Plaintiff. The complaint accuses the defendants of violations of the Securities Exchange Act of 1934 and the Securities Act of 1933 by virtue of the Company's failure to disclose during the Class Period and/or in connection with its IPO that material negative information concerning the Company's ability to raise capital and fund its operations had been withheld, that the Company's substantial "burn rate" threatened DDMG's ability to continue as a going concern, and that the Company would be unable to meet its operating expenses. According to the complaint, after, on Aug. 1, 2012, it was disclosed that the Company would explore strategic and financial alternatives, and after the Company filed for Chapter 11 bankruptcy protection on Sept. 11, 2012, the value of DDMG shares declined significantly. About Digital Domain Digital Domain Media Group, Inc. -- http://www.digitaldomain.com/ -- engages in the creation of original content animation feature films, and development of computer-generated imagery for feature films and transmedia advertising primarily in the United States. Digital Domain Media Group, Inc. and 13 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on Sept. 11, 2012, to sell its business for $15 million to Searchlight Capital Partners LP. The Debtors have also sought ancillary relief in Canada, pursuant to the Companies' Creditors Arrangement Act in the Supreme Court of British Columbia, Vancouver Registry. Port St. Lucie, Florida-based Digital Domain disclosed assets of $205 million and liabilities totaling $214 million. DDMG also announced that it has entered into a purchase agreement with Searchlight Capital Partners L.P. to acquire Digital Domain Productions Inc. and its operating subsidiaries in the United States and Canada, including Mothership Media, subject to the receipt of higher and better offers and Court approval. DDPI and Mothership, with studios in California and Vancouver, are focused on creating digital visual effects, CG animation and digital production for the entertainment and advertising industries and are led by recently promoted Chief Executive Officer Ed Ulbrich. Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. An official committee of unsecured creditors has been appointed in the case. The panel has tapped as bankruptcy counsel William D. Sullivan, Esq., and Seth S. Brostoff, Esq., at Sullivan Hazeltine Allinson LLC; and H. Jeffrey Schwartz, Esq., and Bennett S. Silverberg, at Brown Rudnick LLP. DIGITAL DOMAIN: Sale Order Presented for Judge's Signature ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the bankruptcy judge told Digital Domain Media Group Inc. at a hearing Sept. 24 that he will approve the sale of the principal part of the business to a joint venture between Galloping Horse America LLC, an affiliate of Beijing Galloping Horse Co., and an affiliate of Reliance Capital Ltd., based in Mumbai. According to the report, the $36.7 million total value of the contact includes $3.6 million to cure defaults on contracts and $2.9 million in reimbursement of payroll costs. The opening bid at auction on Sept. 21 was $15 million. One day following the Chapter 11 filing on Sept. 11, the bankruptcy judge gave Digital Domain permission to hold the auction for the provider of visual effects for the movie industry. The order that will formally approval the sale was presented to the court before midnight Sept. 24. The report relates that two lawsuits have now been filed against Digital Domain for firing workers at the facility in Port St. Lucie, Florida, without giving 60 days' notice required under federal law known as the Warn Act. One of the lawsuits says there are 350 workers who didn't receive required notice. About Digital Domain Digital Domain Media Group, Inc. -- http://www.digitaldomain.com/ -- engages in the creation of original content animation feature films, and development of computer-generated imagery for feature films and transmedia advertising primarily in the United States. Digital Domain Media Group, Inc. and 13 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on Sept. 11 to sell its business for $15 million to Searchlight Capital Partners LP. The Debtors have also sought ancillary relief in Canada, pursuant to the Companies' Creditors Arrangement Act in the Supreme Court of British Columbia, Vancouver Registry. Port St. Lucie, Florida-based Digital Domain disclosed assets of $205 million and liabilities totaling $214 million. DDMG also announced that it has entered into a purchase agreement with Searchlight Capital Partners L.P. to acquire Digital Domain Productions Inc. and its operating subsidiaries in the United States and Canada, including Mothership Media, subject to the receipt of higher and better offers and Court approval. DDPI and Mothership, with studios in California and Vancouver, are focused on creating digital visual effects, CG animation and digital production for the entertainment and advertising industries and are led by recently promoted Chief Executive Officer Ed Ulbrich. Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. An official committee of unsecured creditors appointed in the case is represented by lawyers at Sullivan Hazeltine Allinson LLC and Brown Rudnick LLP. The company listed assets of $205 million and liabilities totaling $214 million. Debt includes $40 million on senior secured convertible notes plus $24.7 million in interest. There is another issue of $8 million in subordinated secured convertible notes. DUNE ENERGY: Inks Employment Agreements with Two Executives ----------------------------------------------------------- Dune Energy, Inc., entered into employment agreements effective Oct. 1, 2012, with James A. Watt and Frank T. Smith, Jr. The Employment Agreements provide for Mr. Watt to continue to serve as the Company's President and Chief Executive Officer, at an annual base salary of $550,000, subject to adjustment by the Company's Board of Directors in its sole discretion, and Mr. Smith to continue to serve as the Company's Senior Vice President and Chief Financial Officer, at an annual base salary of $306,000, subject to adjustment by the Board in its sole discretion. The initial terms of employment under the Employment Agreements for Mr. Watt and Mr. Smith are 39 months and 27 months respectively, unless earlier terminated. In addition to their base salary, Mr. Watt and Mr. Smith are eligible for a targeted annual bonus equal to 100% and 70%, respectively, of that officer's then applicable base salary, as determined by the Board, based upon performance criteria set forth in the Employment Agreements. In addition, Mr. Watt and Mr. Smith are being awarded 125,000 shares of common stock of the Company and 100,000 shares of common stock of the Company, respectively. The shares of common stock granted under the Employment Agreements vest over a three year period, 1/3 each year on the anniversary of the effective date of the Employment Agreements (Oct. 1, 2012). About Dune Energy Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/ -- is an independent energy company based in Houston, Texas. Since May 2004, the Company has been engaged in the exploration, development, acquisition and exploitation of natural gas and crude oil properties, with interests along the Louisiana/Texas Gulf Coast. The Company's properties cover over 90,000 gross acres across 27 producing oil and natural gas fields. The Company reported a net loss of $60.41 million in 2011, compared with a net loss of $75.53 million in 2010. The Company's balance sheet at June 30, 2012, showed $246.60 million in total assets, $123.28 million in total liabilities, and $123.31 million in total stockholders' equity. * * * As reported by the TCR on Dec. 27, 2011, Standard & Poor's Ratings Services lowered its corporate credit rating on Dune Energy Inc. to 'SD' (selective default) from 'CC'. "The rating actions follow the company's announcement that it has completed the exchange offer for its 10.5% senior notes due 2012, which we consider a distressed exchange and tantamount to a default," said Standard & Poor's credit analyst Stephen Scovotti. "Holders of $297 million of principle amount of the senior secured notes exchanged their 10.5% senior secured notes for common stock, which in the aggregate constitute 97.0% of Dune's common stock post-restructuring, and approximately $49.5 million of newly issued floating rate senior secured notes due 2016. We consider the completion of such an exchange to be a distressed exchange and, as such, tantamount to a default under our criteria." In the Jan. 2, 2012, edition of the TCR, Moody's Investors Service revised Dune Energy, Inc.'s Probability of Default Rating (PDR) to Caa3/LD from Ca following the closing of the debt exchange offer of the company's 10.5% secured notes. Simultaneously, Moody's upgraded the Corporate Family Rating (CFR) to Caa3 reflecting Dune's less onerous post-exchange capital structure and affirmed the Ca rating on the secured notes. The revision of the PDR reflects Moody's view that the exchange transaction constitutes a distressed exchange. Moody's will remove the LD (limited default) designation in two days, change the PDR to Caa3, and withdraw all ratings. ELPIDA MEMORY: Bondholders Fight for Court Liaison Appointment -------------------------------------------------------------- Jamie Santo at Bankruptcy Law360 reports that Elpida Memory Inc. bondholders fired back Tuesday after the Japanese chipmaker objected to their request for the expedited appointment of a liaison between the U.S. and Japanese courts handling the company's bankruptcy, claiming immediate action is necessary given the rapid progress of the foreign proceedings. Decrying a lack of timely information, bondholders on Friday asked U.S. Bankruptcy Judge Christopher S. Sontchi, who is overseeing Elpida's Chapter 15 case in Delaware, to hear their motion to appoint an intermediary on a shortened basis, Bankruptcy Law360 relates. About Elpida Memory Elpida Memory Inc. (TYO:6665) -- http://www.elpida.com/ja/-- is a Japan-based company principally engaged in the development, design, manufacture and sale of semiconductor products, with a focus on dynamic random access memory (DRAM) silicon chips. The main products are DDR3 SDRAM, DDR2 SDRAM, DDR SDRAM, SDRAM, Mobile RAM and XDR DRAM, among others. The Company distributes its products to both domestic and overseas markets, including the United States, Europe, Singapore, Taiwan, Hong Kong and others. The company has eight subsidiaries and two associated companies. After semiconductor prices plunged, Japan's largest maker of DRAM chips filed for bankruptcy in February with liabilities of 448 billion yen ($5.6 billion) after losing money for five quarters. Elpida Memory and its subsidiary, Akita Elpida Memory, Inc., filed for corporate reorganization proceedings in Tokyo District Court on Feb. 27, 2012. The Tokyo District Court immediately rendered a temporary restraining order to restrain creditors from demanding repayment of debt or exercising their rights with respect to the company's assets absent prior court order. Atsushi Toki, Attorney-at-Law, has been appointed by the Tokyo Court as Supervisor and Examiner in the case. Elpida Memory Inc. sought the U.S. bankruptcy court's recognition of its reorganization proceedings currently pending in Tokyo District Court, Eight Civil Division. Yuko Sakamoto, as foreign representative, filed a Chapter 15 petition (Bankr. D. Del. Case No. 12-10947) for Elpida on March 19, 2012. EMISPHERE TECHNOLOGIES: Defaults on $31.1MM Notes Due MHR Fund -------------------------------------------------------------- Emisphere Technologies, Inc., said that, as of Sept. 27, 2012, it will be in default under the terms of the Company's 11% Senior Secured Convertible Notes issued to MHR Fund Management LLC. Additionally, as of Sept. 27, 2012, the Company will be in default under the terms of certain non-interest bearing promissory notes issued to MHR on June 8, 2010. These defaults occurred, and are continuing, as a result of the Company's failure to pay to MHR approximately $30.5 million in principal and interest due and payable on Sept. 26, 2012, under the terms of the Senior Secured Convertible Notes, and the Company's failure to pay to MHR $600,000 in principal due and payable on Sept. 26, 2012, under the terms of the MHR 2010 Promissory Notes. The Company's obligations under the Senior Secured Convertible Notes are secured by substantially all of the Company's assets, and MHR has the ability to foreclose on those assets as a result of the default thereunder. MHR has not demanded payment under the Senior Secured Convertible Notes or the MHR 2010 Promissory Notes or exercised its rights thereunder as a result of the default. MHR has indicated to the Company that it is prepared to continue discussions with the Company regarding proposals relating to the Senior Secured Convertible Notes and MHR 2010 Promissory Notes and the Company's default thereunder, while reserving all of its rights under the Senior Secured Convertible Notes and MHR 2010 Promissory Notes. A copy of the Form 8-K is available for free at: http://is.gd/reqAuX About Emisphere Cedar Knolls, N.J.-based Emisphere Technologies, Inc., is a biopharmaceutical company that focuses on a unique and improved delivery of therapeutic molecules or nutritional supplements using its Eligen(R) Technology. These molecules are currently available or are under development. The Company's balance sheet at June 30, 2012, showed $2.52 million in total assets, $64.86 million in total liabilities, and a stockholders' deficit of $62.34 million. McGladrey and Pullen, LLP, in New York City, expressed substantial doubt about Emisphere'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 has suffered recurring losses from operations and its total liabilities exceed its total assets. ESSAR STEEL: S&P Affirms 'CCC+' Corporate Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services removed its ratings on Sault Ste. Marie, Ont.-based Essar Steel Algoma Inc. (ESA) from CreditWatch, where they had been placed with developing implications April 5, 2012. At the same time, Standard & Poor's affirmed its ratings on ESA, including its 'CCC+' long-term corporate credit rating. The outlook is developing. "Our removal of the ratings from CreditWatch reflects our view of the completion of ESA's two-year US$350 senior secured term loan, with the proceeds subsequently being used to repay and terminate its US$300 million senior secured revolving credit facility," said Standard & Poor's credit analyst Donald Marleau. "The ratings on ESA reflect what we view as the company's highly leveraged financial risk profile, featuring a less-than-adequate liquidity position, a large debt burden, and thin coverage ratios; coupled with a vulnerable business risk profile that features an exposure to volatile end markets and limited operating diversity. These risks, in our opinion, are somewhat counterbalanced by the company's better-than-average cost profile," Mr. Marleau added. "We believe that the corporate credit rating on ESA depends heavily on two largely uncontrollable external factors--steel prices and debt markets. While the outlook for North American steel appears to have recovered modestly from recent trough levels, ESA's profitability and leverage depend almost entirely on further upswings in steel prices to support its heavy debt burden. Secondly, we expect that working-capital funding and long- term cash flow predictability will be overshadowed by challenges associated with the company's reliance on volatile capital markets to refinance several tranches of debt beginning in September 2014," S&P said. "The developing outlook indicates that we could raise or lower the ratings over a period of up to two years depending on the progress ESA makes in addressing its upcoming debt maturities," S&P said. "We could raise the ratings if the company performs much stronger than our base case operating expectations in the next several quarters with its debt-to-EBITDA leverage ratio declining to about 5x with positive free operating cash flows that supplement its liquidity position. In our view, this could improve ESA's reception in the capital markets with refinancing transactions occurring well ahead of mid-2014," S&P said. "Alternatively, we could lower the ratings on ESA if its weak profitability restricts the company's access to capital markets. We believe that ESA will have a limited opportunity to refinance upcoming debt maturities, the success of which will depend heavily on contemporary steel prices and capital markets conditions," S&P said. FENTURA FINANCIAL: Files Form 15, Halts Filing of Reports --------------------------------------------------------- Fentura Financial, Inc., filed a Form 15 with the U.S. Securities and Exchange Commission notifying of its suspension of its duty under Section 15(d) to file reports required by Section 13(a) of the Securities Exchange Act of 1934 with respect to its common stock. There were only 800 holders of the common shares as of Sept. 24, 2012. The Company's board of directors has determined that the Company would benefit from that action by eliminating significant costs, including fees and expenses relating to the preparation and filing of periodic reports with the Commission, and by permitting management to spend less time on report preparation, which will allow them to devote full attention and effort to the Company's operations. About Fentura Financial Based in Fenton, Michigan, Fentura Financial, Inc., is a registered bank holding company, owns and controls The State Bank, Fenton, Michigan, and West Michigan Community Bank, Hudsonville, Michigan, both state nonmember banks, and two nonbank subsidiaries. Fentura Financial shares are traded over the counter under the FETM trading symbol. Fentura Financial, Inc., entered into a Written Agreement with the Federal Reserve Bank of Chicago on Nov. 4, 2010. Among other things, the Written Agreement requires that the Company obtain the approval of the FRB prior to paying a dividend; requires that the Company obtain the approval of the FRB prior to making any distribution of interest, principal, or other sums on subordinated debentures or trust preferred securities; prohibits the Company from purchasing or redeeming any shares of its stock without the prior written approval of the FRB; requires the submission of a written capital plan by Jan. 3, 2011, and; requires the Company to submit cash flow projections for the Company to the FRB on a quarterly basis. The Company reported a net loss of $1.51 million in 2011, compared with a net loss of $5.38 million in 2010. The Company's balance sheet at June 30, 2012, showed $297.87 million in total assets, $283.52 million in total liabilities and $14.34 million in total stockholders' equity. FIELD FAMILY: Files List of 20 Largest Unsecured Creditors ---------------------------------------------------------- Field Family Associates, LLC, filed with the U.S. Bankruptcy Court for the Eastern District of Pennsylvania a list of its 20 largest unsecured creditors, disclosing: Name of Creditor Nature of Claim Amount of Claim ---------------- --------------- --------------- Hilton Hotels Corporation Franchisor $582,925.29 4649 Paysphere Circle Chicago, IL 60674-4649 Jetway Security & Investigations, LLC Security Service $31,976.67 JFK International Airport Bldg. 76, Suite 7 Jamaica, NY 11430 Con Edison Electricity $30,317.84 JAF Station P.O. Box 1701 New York, NY 10116-1701 Sysco Metro NY, LLC Breakfast Items $15,518.43 20 Theodore Conrad Drive Jersey City, NJ 07305-4614 Hip Health Insurance Plan of Greater NY Employee & Medical P.O. Box 9329, G.P.O Insurance $15,274.50 New York, NY 10087-9329 Ollie Cherniahivsky & Associates Architect $14,481.34 1022 Spruce St. Philadelphia, PA 19107 NY Fire Consultants, Inc. Fire Equipment 165 Mc Baine Avenue testing $3,000.00 Staten Island, NY 10309 Guest Supply Guest Supplies & P.O. Box 910 Amenities $2,817.32 Monmouth Junction, NJ 08852-0910 Capital Supply Company Laundry & Cleaning 620 12th Avenue Supplies $2,676.04 New York, NY 10036-1004 Fujitec New York Elevator Maintenance $2,637.78 215 Entin Road Clifton, NJ 07014 Ernst & Young Legal Services $2,500.00 5 Times Square, 17th Fl New York, NY 10036 Design Communications Inc. Telephone Equip. Maintenance $2,062.95 The Brickman Group Ltd., LLC Landscaping $1,124.22 Penn Glass Enterprises, Ltd. Glass repair/Installation $1,012.54 Office Depot Stationer Supplies $493.86 Industrial Television Flight Monitor $428.97 Services, Inc. Idlewild Best Hardware Maintennce Supplies $277.27 All County Pest Control, Inc. Exterminating $163.31 FedEx Express Mail $121.77 IBI Armored Services, Inc. Armored car service $82.75 Five creditors filed an involuntary Chapter 11 bankruptcy petition against King of Prussia, Pa.-based Field Family Associates, LLC (Bankr. E.D. Pa. Case No. 12-16331) on July 2, 2012. The Court entered an order for Chapter 11 relief on Sept. 12, 2012. The Debtor is a limited liability company organized under the laws of the State of New York that operates a Hampton Inn hotel at 144-10 135th Avenue, Jamaica, New York. Judge Stephen Raslavich presides over the case. The involuntary petitioners were not represented by a lawyer. FIELD FAMILY: Hiring Dilworth Paxson as Bankruptcy Counsel ---------------------------------------------------------- Field Family Associates, LLC, d/b/a JFK Hampton Inn asks the U.S. Bankruptcy Court for the Eastern District of Pennsylvania for authority to employ Dilworth Paxson LLP as its counsel, nunc pro tunc to Sept. 12, 2012. Dilworth will render these professional services: a. providing the Debtor with legal services with respect to its powers and duties as a debtor-in-possession; b. preparing on behalf of the Debtor or assisting the Debtor in preparing all necessary pleadings, motions, applications, complaints, answers, responses, orders, United States Trustee reports, and other legal papers; c. representing the Debtor in any matter involving contests with secured or unsecured creditors, including the claims reconciliation process; d. assisting the Debtor in providing legal services required to prepare, negotiate and implement a plan of reorganization; and e. performing all other legal services for the Debtor which may be necessary, other than those requiring specialized expertise for which special counsel, if necessary, may be employed. The Debtor proposes to pay Dilworth its customary hourly rates. The Debtor believes that Dilworth does not have any connection with or interest adverse to the Debtor, the Debtor's creditors, any other party-in-interest, or the Office of the United States Trustee or its respective attorneys. Five creditors filed an involuntary Chapter 11 bankruptcy petition against King of Prussia, Pa.-based Field Family Associates, LLC (Bankr. E.D. Pa. Case No. 12-16331) on July 2, 2012. The Court entered an order for relief on Sept. 12, 2012. The Debtor is a limited liability company organized under the laws of the State of New York that operates a Hampton Inn hotel at 144-10 135th Avenue, Jamaica, New York. Judge Stephen Raslavich presides over the case. The involuntary petitioners were not represented by a lawyer. FIRST NIAGARA: Current Capital Position Cues Fitch to Cut Ratings ----------------------------------------------------------------- Fitch Ratings has downgraded the long-term and short-term Issuer Default Ratings (IDR) of First Niagara Financial Group, Inc. (FNFG) and its subsidiaries at 'BBB-' and 'F3', respectively. The Rating Outlook is revised to Negative. Prior to the downgrades the ratings were on Rating Watch Negative. The downgrade and Negative Outlook reflects Fitch's view that FNFG's current capital position (following the closing of its HSBC acquisition and the balance sheet restructuring) is considered lean providing limited flexibility should challenges arise given significant loan growth through acquisitions in recent periods and heightened integration risks. Further, Fitch believes the company's capital build may be prolonged versus the agency's initial expectations. Although FNFG's core operating revenues continue to be satisfactory, in Fitch's view, forecasted earnings may be complicated by the difficult economic and low interest rate environment. Additionally, FNFG's capital position is much lower than similarly-rated peers and most of Fitch's U.S. rated financial institutions from a tangible common equity (TCE) position and a regulatory capital standpoint. FNFG's Tier 1 Common Ratio, TCE and Tier 1 RBC totaled 7.41%, 5.69%, and 9.40% for 2Q12, respectively. For 'BBB' rated U.S. Banks, Fitch Core Capital/RWA (which is a similar measure to Tier 1 Common) average is 13.08%, TCE average is 9.08% and Tier 1 TBC is 13.73% for 2Q12. FNFG estimates that Tier 1 Common Ratio under Basel III would be reduced by 20-25 bps based at June 30, 2012. Fitch notes that the company's risk profile has also modestly increased given riskier investment securities such as CLO holdings and the loan portfolio mix has shifted to more commercially- oriented loans. The company has also increased its lending activities in highly leveraged transactions, asset-based lending, credit cards, indirect auto, and syndicated loans. Given economic uncertainties, credit losses may increase from historical standards. To date, asset quality is solid and remains a rating strength. Despite the credit downturn, FNFG's NCOs and NPAs (which includes troubled debt restructuring and acquired loans) stood at 0.36% and 1.64% for 2Q12. Fitch also notes that FNFG's loan book has an estimated 3% credit mark. Although, Fitch believes NCOs will increase from historical performance given commercial loan growth, it is expected to remain manageable. Fitch views positively that FNFG recently restructuring its investment securities book to reduce its interest rate risk related to MBS holdings. However, the company still maintains a sizeable securities book accounting for 33% of total assets at June 30, 2012. Although prepayment risk was reduced, reinvestment of future cashflows is expected to generate lower yields given rate environment. FNFG's holding company position is considered ample to support its debt obligations and common dividend. At June 30, 2012, FNFG's parent company had $446 million in cash to service about $47 million of interest and operating expenses and about $111 million in common dividend. The company expects to manage holding company liquidity with a minimum debt service coverage ratio of 2x. Rating Sensitivities Positive rating action or a return to a Stable Outlook may ensue should the company improve its capital position to peer averages, absent any negative asset quality trends and decline in profitability measures. Although considered unlikely, a downgrade would be possible should FNFG announce an acquisition in the near term, manage its capital more aggressively and/or experience a change in credit quality trends materially worse than Fitch's expectations. Fitch downgrades the following ratings with a Negative Outlook: First Niagara Financial Group, Inc -- Long-term IDR to 'BBB-' from 'BBB'; -- Short-Term IDR to 'F3' from 'F2'; -- Senior Unsecured to 'BBB-' from 'BBB' -- Preferred stock to 'B' from 'B+'; -- Subordinated debt to 'BB+' from 'BBB-'; -- Viability to 'bbb-' from 'bbb'. First Niagara Bank -- Long-term deposits to 'BBB' from 'BBB+'; -- Long-term IDR to 'BBB-' from 'BBB'; -- Short-term deposits to 'F3' from 'F2'; -- Short-Term IDR to 'F3' from 'F2'; -- Viability to 'bbb-' from 'bbb'. First Niagara Commercial Bank -- Long-term deposits to 'BBB' from 'BBB+'; -- Long-term IDR to 'BBB-' from 'BBB'; -- Short-term deposits to 'F3' from 'F2'; -- Short-Term IDR to 'F3' from 'F2'; -- Viability to 'bbb-' from 'bbb'. Fitch has affirmed the following ratings: First Niagara Financial Group -- Support at '5'; -- Support Floor at 'NF'. First Niagara Bank -- Support at '5'; -- Support Floor at 'NF'. First Niagara Commercial Bank -- Support at '5'; -- Support Floor at 'NF'. FISHER ISLAND: Stipulates to Hogan Lovells as Bankruptcy Counsel ---------------------------------------------------------------- Alleged Debtor Fisher Island Investments, Inc., stipulates to the substitution of John F. O'Sullivan, Esq., and the firm of Hogan Lovells US LLP, 200 S. Biscayne Blvd., 4th Floor, Miami, FL 33131 for Joseph L. Rebak, Esq, and the firm of Tews Cardenas LLP, Four Seasons Tower, 1441 Brickell Avenue, 15th Floor, Miami FL 33131 as counsel in the Alleged Debtor's involuntary Chapter 11 case. All future pleadings, motions, notices, correspondence and other papers should be directed to: John F. O'Sullivan, Esq. Hogan Lovells US LLP 200 South Biscayne Blvd., 4th Floor Miami, FL 33131 Tel: (305) 459-6500 Fax: (305) 459-6550 E-mail: john.osullivan@hoganlovells.com Solby+Westbrae Partners; 19 SHC Corp.; Ajna Brands Inc.; 601/1700 NBC LLC; Axafina Inc.; and Oxana Adler, LLM, filed an involuntary Chapter 11 petition against Miami Beach, Florida-based Fisher Island Investments, Inc. (Bankr. S.D. Fla. Case No. 11-17047) on March 17, 2011. On the same date, involuntary Chapter 11 petitions were also filed against the Company's affiliates, Mutual Benefits Offshore Fund, LTD (Bankr. S.D. Fla. Case No. 11-17051) and Little Rest Twelve, Inc. (Bankr. S.D. Fla. Case No. 11-17061). Judge A. Jay Cristol presides over the case. The case was previously assigned to Judge Laurel M. Isicoff. Petitioning creditors are represented by Craig A. Pugatch, Esq., and George L. Zinkler, Esq., at Rice Pugatch Robinson & Schiller, P.A., 101 NE 3 Ave. Suite 1800, Fort Lauderdale FL 33301. John F. O'Sullivan, Esq., at Hogan Lovells US LLP, Patricia A. Redmond, Esq., at Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A.,, and Terrance A. Dee, Esq., at DiBello, Lopez & Castillo, P.A., represent Alleged Debtor Fisher Island Investments, Inc., as counsel. Donald F. Walton, the U.S. Trustee for Region 21, appointed James S. Feltman as an examiner in the involuntary cases. Greenberg Traurig, P.A., serves as counsel for the examiner. FISHER ISLAND: Petitioning Creditors Ask Court to Dismiss Cases --------------------------------------------------------------- Petitioning creditors Solby+Westbrae Partners, 19 SHC Corp., Ajna Brands Inc., 601/1700 NBC LLC, Axafina Inc., and Oxana Adler, LLM, gave notice that they withdraw their respective petitions and further confirm that they are not prosecuting or seeking an order for relief in alleged debtors Fisher Island Investments, Inc., et al.'s involuntary bankruptcy cases. In view of this, Petitioning Creditors request that the U.S. Bankruptcy Court for the Southern District of Florida dismiss their involuntary petitions and the Alleged Debtors's bankruptcy cases. Petitioning Creditors tell the Court that in the nearly a year and a half that the request for relief has proceeded, the petitions have not been resolved and are not any closer to their resolution than at the time of their filing due to extensive litigation regarding ownership and control of the Alleged Debtors. Essentially, according to papers filed with the Court, the only substantive litigation regarding the Petitioning Creditors' petitions and order for relief consisted of the Redmond Group's request for bonds pursuant to 11 U.S.C. Section 303(e). In fact, even though the Petitioning Creditors did not post the bonds, the Alleged Debtors resisted the dismissal of the involuntary petitions. "Further, while a justiciable controversy existed at the time of the filing of the petitions, there is no pending controversy before the Court regarding the relief sought by the involuntary petitions because four out of six Petitioning Creditors no longer have claims against the Alleged Debtors. Hence, further protraction of the case serves no purpose and unnecessarily spends the resources of the parties and this Court." About Fisher Island Solby+Westbrae Partners; 19 SHC Corp.; Ajna Brands Inc.; 601/1700 NBC LLC; Axafina Inc.; and Oxana Adler, LLM, filed an involuntary Chapter 11 petition against Miami Beach, Florida-based Fisher Island Investments, Inc. (Bankr. S.D. Fla. Case No. 11-17047) on March 17, 2011. On the same date, involuntary Chapter 11 petitions were also filed against the Company's affiliates, Mutual Benefits Offshore Fund, Ltd. (Bankr. S.D. Fla. Case No. 11-17051) and Little Rest Twelve, Inc. (Bankr. S.D. Fla. Case No. 11-17061). Judge A. Jay Cristol presides over the case. The case was previously assigned to Judge Laurel M. Isicoff. Petitioning creditors are represented by Craig A. Pugatch, Esq., and George L. Zinkler, Esq., at Rice Pugatch Robinson & Schiller, P.A., 101 NE 3 Ave. Suite 1800, Fort Lauderdale FL 33301. John F. O'Sullivan, Esq., at Hogan Lovells US LLP, Patricia A. Redmond, Esq., at Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A.,, and Terrance A. Dee, Esq., at DiBello, Lopez & Castillo, P.A., represent Alleged Debtor Fisher Island Investments, Inc., as counsel. Donald F. Walton, the U.S. Trustee for Region 21, appointed James S. Feltman as an examiner in the involuntary cases. Greenberg Traurig, P.A., serves as counsel for the examiner. FTMI REAL ESTATE: Emeritus to Lead Auction; Shefaor Quits --------------------------------------------------------- FTMI Real Estate, LLC, and FTMI Operator, LLC, d/b/a The Lenox on the Lake, will proceed to next week's auction of their assisted living facility with another stalking horse bidder. The Debtors have informed the Bankruptcy Court they have struck a deal with Emeritus Corporation and its affiliate Lenox Care Group, LLC, to be the lead bidder after the original stalking horse bidder, Shefaor Develoment, LLC, withdrew on Sept. 2, 2012, within the due diligence period. The Debtors reached an agreement with Emeritus on Sept. 7. Competing bids are due Oct. 1. If rival offers are received, the Debtors will hold an auction the next day at the Fort Lauderdale, Fla., law offices of Rice Pugach Robinson and Schiller. The auction was originally set at the offices of Fort Lauderdale offices of Genovese Joblove & Battista, P.A., counsel to Shefaor. A hearing to approve the sale is set for Oct. 4. The Debtors intend to close the sale by Oct. 16. Two days after filing for bankruptcy, the Debtors sought approval to sell their assets to Shefaor, subject to higher and better offers, for $13 million, subject to a $400,000 carve out. The Debtors proposed that other potential bidders must offer no less than $13.35 million. The Debtors proposed to pay the stalking horse bidder a $260,000 "Break-Up Fee" in the event it is not the Successful Bidder. Donald F. Walton, the United States Trustee for Region 21, had objected to the sale. Damaris Rosich-Schwartz, Esq., representing the U.S. Trustee, expressed concern that the Debtors were seeking approval of bidding procedures so early in the case. The U.S. Trustee also said the Debtors failed to disclose specific marketing efforts and whether the Stalking Horse Bidder has the qualifications to provide the necessary health care services to the patients-residents. The U.S. Department of Housing & Urban Development is the holder of a $25 million mortgage on the Debtors' 139-bed facility. The sale is intended to transfer the property to the buyer free of the HUD mortgage. Seattle-based Emeritus Corporation (NYSE: ESC) -- http://www.emeritus.com/-- is a national provider of senior living services. Emeritus has more than 28,000 employees serving residents at 477 communities throughout 44 states coast to coast. About FTMI Real Estate FTMI Real Estate, LLC and FTMI Operator, LLC sought Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 12-29214) in Fort Lauderdale on Aug. 10, 2012. FTMI Operator, which operates a health care business The Lenox on The Lake, disclosed just $112,000 in assets and $31.98 million in liabilities. The LENOX -- http://www.thelenox.com-- is South Florida's, newest state-of-the-art Assisted Living and Memory Care community, which has a serene lakeside setting and wonderful waterfront vistas. FTMI Real Estate, a single asset real estate under 11 U.S.C. Sec. 101(51B), scheduled $19.64 million in assets and $28.93 million in liabilities. The Debtor owns The Lenox on The Lake facilities at 6700 Commercial Boulevard, in Lauderhill, Florida valued at $13 million. The Secretary of Housing Urban Development has a $25.87 million claim secured by the property. FTMI REAL ESTATE: U.S. Trustee Appoints Patient Care Ombudsman -------------------------------------------------------------- Donald F. Walton, United States Trustee, has appointed a Patient Care Ombudsman for FTMI Operator, LLC (Case No. 12-29215-BKC-RBR): Michael Karban P.O. Box 7642 Fort Lauderdale, FL 33338 Tel: (954) 662-6256 Section 333 of the Bankruptcy Code provides that the Patient Care Ombudsman will: 1) monitor the quality of patient care provided to patients of the debtor, to the extent necessary under the circumstances, including interviewing patients and physicians; 2) not later than 60 days after the date of this appointment, and not less frequently than at 60-day intervals thereafter, report to the court after notice to the parties-in-interest, at a hearing or in writing, regarding the quality of patient care provided to patients of the debtor; 3) if such ombudsman determines that the quality of patient care provided to patients of the debtor is declining significantly or is otherwise being materially compromised, file with the court a motion or a written report, with notice to the parties in interest immediately upon making such determination; and 4) will maintain any information obtained by the ombudsman under section 333 of the Bankruptcy Code that relates to patients (including information relating to patient records) as confidential information. Such ombudsman may not review confidential patient records unless the court approves such review in advance and imposes restrictions on such ombudsman to protect the confidentiality of such records. The Bankruptcy Court earlier authorized the U.S. Trustee to appoint a patient care ombudsman, overruling the objection of the Debtors. At the onset of the case, FTMI Operator argued the appointment of a patient care ombudsman is unnecessary, saying it has been operating the assisted living facility since 2009 and there is no conduct or circumstances which would require an ombudsman. About FTMI Real Estate FTMI Real Estate, LLC and FTMI Operator, LLC sought Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 12-29214) in Fort Lauderdale on Aug. 10, 2012. FTMI Operator, which operates a health care business The Lenox on The Lake, disclosed just $112,000 in assets and $31.98 million in liabilities. The LENOX -- http://www.thelenox.com-- is South Florida's, newest state-of-the-art Assisted Living and Memory Care community, which has a serene lakeside setting and wonderful waterfront vistas. FTMI Real Estate, a single asset real estate under 11 U.S.C. Sec. 101(51B), scheduled $19.64 million in assets and $28.93 million in liabilities. The Debtor owns The Lenox on The Lake facilities at 6700 Commercial Boulevard, in Lauderhill, Florida valued at $13 million. Secretary of Housing Urban Development has a $25.87 million claim secured by the property. GENE CHARLES: Court OKs Mazur Kraemer as Local Counsel ------------------------------------------------------ Gene Charles Valentine sought and obtained approval from the U.S. Bankruptcy Court to employ Mazur Kraemer Business Law as Chapter 11 counsel. The Debtor also filed an application to employ Weir & Parners LLP, as co-counsel. W&P will assist and consult with the Debtor's lead and local counsel Mazur Kraemer Business Law for these purposes: a. providing legal assistance and counseling with respect to the Chapter 11 case; b. providing legal advice with respect to assisting Debtor in the preparation of the Plan of Reorganization and Disclosure Statement; c. providing legal assistance with respect to Confirmation of the Plan of Reorganization; and d. performing all other legal services for the Debtor that may be necessary and proper in the proceedings. About Gene Charles Valentine A business trust created by investment advisor and broker-dealer agent Gene Charles Valentine sought Chapter 11 bankruptcy protection (Bankr. N.D. W.Va. Case No. 12-01078) in Wheeling, West Virginia on Aug. 9, 2012. The Gene Charles Valentine Trust owns commercial and real estate properties in West Virginia, the Financial West Group, the Peace Point Equestrian Center and the Aspen Manor. It estimated $10 million to $50 million in assets and up to $10 million in liabilities. Financial West Investment Group, Inc., doing business as Financial West Group -- http://www.fwg.com/-- is a firm with over 340 registered representatives supervised by 44 Offices of Supervisory Jurisdiction throughout the United States. Financial West Group is a FINRA, and SIPC member and SEC Registered Investment Advisor (over $1 billion under control) that offers a full range of financial products and services. Its corporate office 32 member staff is dedicated to providing registered representatives quality service and technology to allow them to focus on best servicing their investors needs. Aspen Manor -- http://www.aspenmanorresort-- is a resort that claims to be the "The Jewel of the Ohio Valley." Along with its architectural artistry, including hand-carved ceilings, the Manor is filled will original art, statues, historic furniture and artifacts. Bankruptcy Judge Patrick M. Flatley oversees the case. The Trust hired Mazur Kraemer Law Inc., as bankruptcy counsel. GHC NY CORP: Romanoff Company Files for Chapter 11 in Manhattan --------------------------------------------------------------- GHC NY Corp. filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-14031) on Sept. 25, 2012. The Debtor is owned by an entity named New Roads Realty Corp., which is ran by Robert Romanoff, who signed the Chapter 11 petition. The Debtor, according to a court filing, sought Chapter 11 protection after Robert Romanoff determined that the attempt of Gerald Romanoff to transfer title to the Company's most valuable asset, the real property and improvements located at 53-61 Gansevoort Street, new York, New York, for inadequate consideration, would permanently impair the Company's ability to pay its debts as they come due. The resolution authorizing the bankruptcy filing also said that the pending foreclosure proceeding against the Manhattan property and the real property and improvements located at 501-511 Church Avenue, Brooklyn, New York, without proper defenses thereto may cause irreparable harm to the company. Robert R. Leinwand, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck P.C., in New York, serves as counsel. GLOBAL AVIATION: Seeks Court OK for CBA Amendment ------------------------------------------------- BankruptcyData.com reports that North American Airlines filed with the U.S. Bankruptcy Court a motion for authority to enter into amendments to its collective bargaining agreement with the Air Line Pilots Association. The Debtors assert, "The Agreement is the final piece in the Debtors' labor puzzle. It provides savings consistent with the Debtors' business plan and the Debtors' obligations to the other union groups who agreed to concessions, and extends the CBA, as modified, for five years, which will provide North American with substantial stability as a reorganized entity. The Agreement is a fair and appropriate resolution of what would otherwise be hotly contested proceedings under section 1113 of the Bankruptcy Code, and is well within North American's business judgment." About Global Aviation Global Aviation Holdings Inc., based in Peachtree City, Ga., is the parent company of North American Airlines and World Airways. Global is the largest commercial provider of charter air transportation for the U.S. military, and a major provider of worldwide commercial global passenger and cargo air transportation services. North American Airlines, founded in 1989 and based in Jamaica, N.Y., operates passenger charter flights using B757-200ER and B767-300ER aircraft. World Airways, founded in 1948 and based in Peachtree City, Ga., operates cargo and passenger charter flights using B747-400 and MD-11 aircraft. Global Aviation, along with affiliates, filed Chapter 11 petitions (Bankr. E.D.N.Y. Case No. 12-40783) on Feb. 5, 2012. Global's lead counsel in connection with the restructuring is Kirkland & Ellis LLP and its financial advisor is Rothschild. Kurtzman Carson Consultants LLC is the claims agent. The Debtors disclosed $589.8 million in assets and $493.2 million in liabilities as of Dec. 31, 2011. Liabilities include $146.5 million on 14% first-lien secured notes and $98.1 million on a second-lien term loan. Wells Fargo Bank NA is agent for both. Global said it will use Chapter 11 to shed 16 of 30 aircraft. In addition, Global said it will use Chapter 11 to negotiate new collective bargaining agreements with its unions and deal with liabilities on multi-employer pension plans. On Feb. 13, 2012, the U.S. Trustee for Region 2 appointed a seven member official committee of unsecured creditors in the case. The Committee tapped Lowenstein Sandler PC as its counsel, and Imperial Capital, LLC as its financial advisor. The Hon. Carla E. Craig has extended the Debtors' exclusive period to file a Chapter 11 plan for each Debtor until Oct. 2, 2012, and the exclusive period to solicit acceptances of a Chapter 11 plan of each Debtor until Dec. 3, 2012. GOE LIMA: Clawback Lawsuit Against Lippincott Goes to Trial ----------------------------------------------------------- Bankruptcy Judge Mary Ann Whipple denied the motion for partial summary judgment filed by Ronald E. Gold, the Liquidating Trustee for GOE Lima LLC, in his clawback lawsuit against Lippincott-Ace Electric Co. In his complaint, the trustee seeks to avoid certain prepetition transfers to the Defendant as preferential transfers under 11 U.S.C. Sec. 547 (Count I) or, in the alternative, as fraudulent transfers under 11 U.S.C. Sec. 548 (Count II) and under 11 U.S.C. Sec. 544 and Ohio Revised Code, Chapter 1336 (Count IV), and to recover the avoided transfers pursuant to 11 U.S.C. Sec. 550 (Count V). The trustee also alleges a claim for avoidance of post-petition transfers under 11 U.S.C. Sec. 549 (Count III) and for disallowance of claims of the Defendant against the Debtor's bankruptcy estate pursuant to 11 U.S.C.. Sec. 502(d) (Count VI). The Plaintiff moves for summary judgment on Counts I and V only. The Debtor's business relationship with Defendant commenced in May 2008. The Defendant's accounts receivable ledger shows that on Sept. 23, 2008, the Debtor owed the Defendant $259,716.36 and that the Debtor paid the Defendant $25,000, reducing the balance to $234,716. The Debtor also paid $36,454.73 on Oct. 10, 2008, further reducing the balance owed to the Defendant to $198,261.63. According to Judge Whipple, the Court cannot conclude that the Transfers resulted in the Defendant receiving more than it would have had it received its pro rata share on liquidation of the estate. Pursuant to the Transfers made by the Debtor, the Defendant received only a fraction of the total amount owed it by the Debtor. Unlike a situation where the Debtor would have received full payment of the debt owed to it, without some evidence of what the Debtor's pro rata share would be had the transfer not been made, a genuine issue exists for trial as to whether the Debtor received more than he would have received in a Chapter 7 case, and the Plaintiff is not entitled to summary judgment on his preference claim. For the same reason, to the extent that Plaintiff's Motion seeks partial summary judgment on Count V of the Complaint for recovery under 11 U.S.C. Sec. 550 based upon the Transfers being avoided under Sec. 547, his Motion will be denied. Although the Defendant offers evidence in support of affirmative defenses asserted under Sec. 547(c), the Court does not address those defenses. The lawsuit is, Ronald E. Gold, Liquidating Trustee, Plaintiff, v. Lippincott-Ace Electric Co., Defendant, Adv. Proc. No. 10-3299 (Bankr. N.D. Ohio). A copy of the Court's Sept. 25, 2012 Memorandum of Decision and Order is available at http://is.gd/DmWbVKfrom Leagle.com. About GOE Lima Headquartered in Lima, Ohio, GOE Lima LLC -- http://www.go-ethanol.com/-- operated an ethanol production facility. The company filed for protection on Oct. 14, 2008 (Bankr. N.D. Ohio Case No. 08-35508). Taft Stettinius & Hollister LLP served as the Debtor's proposed bankruptcy counsel. In its Chapter 11 petition, the Debtor estimated assets and debts between $100 million to $500 million. Greater Ohio Ethanol was authorized by the Bankruptcy Court to sell its ethanol facility to Paladin Ethanol Acquisition LLC for $5.75 million cash and a note for $15.05 million the buyer may repurchase for as little as $2.5 million. Bloomberg News notes the plant cost $117 million to build. There were no acceptable bids by the original Dec. 15, 2008 deadline set by the Bankruptcy Court. On July 8, 2010, the Court entered an order confirming the Debtor's First Amended Joint Plan of Liquidation. GRATON ECONOMIC: S&P Gives 'B' Issuer Credit Rating --------------------------------------------------- Standard & Poor's Ratings Services assigned Rohnert Park, Calif.- based Graton Economic Development Authority (the Authority) its 'B' issuer credit rating. The rating outlook is stable. The Authority is a wholly owned unincorporated instrumentality of the Federated Indians of Graton Rancheria (the Tribe). "At the same time, we assigned the Authority's $375 million senior secured term loan due 2018 and $450 million in senior secured notes due 2019 our 'B' issue-level rating (the same as our issuer credit rating). The senior secured term loan and senior secured notes are pari passu. The Authority also raised a $25 million priority revolving credit facility, which we will not rate. Additionally, pro forma for the transaction, the Authority will have $50 million outstanding in a management loan (manager loan), which is held by a subsidiary of Station Casinos LLC and will be subordinated to the senior secured notes and senior secured term loan," S&P said. "We do not assign recovery ratings to Native American debt issues because there are sufficient uncertainties surrounding the exercise of creditor rights against a sovereign nation, including whether the Bankruptcy Code would apply, whether a U.S. court would ultimately be the appropriate venue to settle such a matter, and to what extent a creditor would be able to enforce any judgment against the sovereign nation," S&P said. The company plans to use proceeds from the proposed transaction to: -- Fund the development and construction of the Graton Resort and Casino (the casino); -- Establish an interest reserve to fund debt service during the construction period and the first several months following the opening of the casino; -- Repay $175 million of the outstanding manager loan; -- Fund ongoing Tribal costs; and -- Fund transaction fees and expenses. "Our 'B' issuer credit rating on the Authority reflects our assessment of its business risk profile as 'weak' and its financial risk profile as 'highly leveraged,' according to our criteria," S&P said. "Our assessment of the business risk profile as weak reflects the vulnerability of new gaming projects to uncertain demand and difficulties managing initial costs, which can lead to poor profitability during the first several months of operations, as well as the Authority's reliance on a single asset to meet debt service needs," said Standard & Poor's credit analyst Michael Halchak. "These risks are somewhat mitigated by our expectation for the property to be the highest asset quality in proximity to the San Francisco market, a somewhat protected market position, and an experienced property manager in Station. However, although there are approximately 2.1 million adults within a 60-minute drive of the property, we see some risk in the fact that the adult population within 30 minutes of the property is only about 354,000 people," S&P said. "Our assessment of the Authority's financial risk profile as highly leveraged reflects a large debt burden and the challenge that new casino properties often face when trying to ramp up cash flow quickly enough to satisfy fixed charges. Despite these risks, we are forecasting that the property will generate excess cash flow to facilitate deleveraging, beginning in its first full year, and have EBITDAM (earnings before interest depreciation and management fees) coverage of interest in the high-1x area at the end of 2014, reaching the high-2x area at the end of 2016," S&P said. GRAY TELEVISION: Senior Notes Offering Increased to $300 Million ---------------------------------------------------------------- Gray Television, Inc., has priced its offering of $300 million aggregate principal amount of 7.500% senior notes due 2020. This represents an increase of $50 million over the amount previously announced. The Notes were priced at 99.266% of par. The Company's existing, and certain future, subsidiaries will guarantee the Notes on a senior unsecured basis. The sale of the Notes is expected to be completed on Oct. 9, 2012, subject to customary closing conditions. The Company intends to use the net proceeds from the offering of the Notes to (i) repurchase for cash a portion of the Company's outstanding 10 1/2% senior secured second lien notes due 2015 pursuant to a previously announced cash tender offer by the Company and (ii) pay related fees and expenses. If the Company does not use all of the proceeds from the offering of Notes to repurchase 2015 notes pursuant to the tender offer for any reason, the Company intends to use the remaining proceeds from the issuance of the Notes to (i) redeem the outstanding shares of the Company's Series D perpetual preferred stock and (ii) repay a portion of the term loans outstanding under the Company's senior credit facility. Gray also increased the size of its previously announced cash tender offer. Under the terms of the upsized Tender Offer, the Company is offering to purchase up to $268.5 million in aggregate principal amount of its outstanding 10 1/2% senior secured second lien notes due 2015. The Maximum Tender Amount had previously been set at $225.0 million. Other than the new Maximum Tender Amount, the other terms and conditions of the Tender Offer remain unchanged. Gray reserves the right, but is not obligated, to further increase the Maximum Repurchase Amount. Gray's obligation to accept for purchase, and to pay for, Notes validly tendered and not properly withdrawn pursuant to the Tender Offer is subject to the satisfaction or waiver of certain conditions, including (i) Gray completing an offering of debt securities in an amount and on terms reasonably satisfactory to Gray and (ii) the entry by Gray into an amendment to Gray's senior credit facility that would allow it to complete the repurchase of Notes in the Tender Offer. Gray is not soliciting consents from holders of Notes in connection with the Tender Offer. None of Gray, its board of directors, the dealer managers or the information agent and tender agent makes any recommendation in connection with the Tender Offer. Gray has engaged BofA Merrill Lynch and Wells Fargo Securities, LLC as the Dealer Managers for the Tender Offer. Persons with questions regarding the Tender Offer should contact BofA Merrill Lynch at (888) 292-0070 or Wells Fargo Securities, LLC at (866) 309-6316. The complete terms and conditions of the Tender Offer are described in the Offer to Purchase and related Letter of Transmittal, copies of which may be obtained from D.F. King & Co., Inc., the Information Agent and Tender Agent for the Tender Offer, at (800) 431-9633. About Gray Television Formerly known as Gray Communications System, Atlanta, Georgia- based Gray Television, Inc., is a television broadcast company. Gray currently operates 36 television stations serving 30 markets. Each of the stations are affiliated with either CBS (17 stations), NBC (10 stations), ABC (8 stations) or FOX (1 station). In addition, Gray currently operates 38 digital second channels including 1 ABC, 4 Fox, 7 CW, 16 MyNetworkTV and 1 Universal Sports Network affiliates plus 8 local news/weather channels and 1 "independent" channel in certain of its existing markets. The Company's balance sheet at June 30, 2012, showed $1.24 billion in total assets, $1.08 billion in total liabilities, $24.99 million in series D perpetual preferred stock, and $135.12 million total stockholders' equity. * * * As reported by the TCR on Sept. 26, 2012, Moody's Investors Service upgraded Gray Television, Inc.'s Corporate Family Rating (CFR) and Probability of Default Rating (PDR) each to B3 from Caa1. The upgrades reflect Moody's expectations for the company to benefit from strong political revenue demand through November 2012 resulting in improved credit metrics combined with management's commitment to reduce leverage. As reported by the TCR on April 9, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Atlanta, Ga.-based TV broadcaster Gray Television Inc. to 'B' from 'B-'. "The 'B' rating reflects company's still-high debt leverage and weak discretionary cash flow, as well as our expectation that the company will maintain adequate headroom with its financial covenants in the absence of any further tightening of covenant thresholds. The stable rating outlook reflects our expectation that Gray will maintain lease-adjusted debt to average trailing- eight-quarter EBITDA below 7.5x. We also expect the company to generate modest positive discretionary cash flow in 2012," S&P said. HERITAGE CONSOLIDATED: Has Use to Cash Collateral Until Sept. 30 ---------------------------------------------------------------- Debtors Heritage Consolidated, LLC, and Heritage Standard Corporation, together with the Official Committee of Unsecured Creditors of the Debtors, have stipulated to the Debtors' continued use of cash collateral until Sept. 30, 2012, to pay the items and amounts set forth in the monthly operating budget. Pursuant to the terms of the Cash Collateral Order dated March 11, 2011, which authorized the Debtors to use Cash Collateral until March 31, 2011, the Debtors and the Committee are authorized to extend the use of Cash Collateral by written agreement with the Bankruptcy Court. Stipulations have been previously filed with the Court for the monthly periods through and including August 2012. About Heritage Consolidated Heritage Consolidated LLC is a privately held company whose core operations consist of exploration for, and acquisition, production, and sale of, crude oil and natural gas. Heritage Consolidated filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 10-36484) on Sept. 14, 2010, in Dallas, Texas. Its affiliate, Heritage Standard Corporation, also filed for Chapter 11 protection (Bankr. N.D. Tex. Case No. 10-36485). The Debtors each estimated assets and debts of $10 million to $50 million. Attorneys at Munsch Hardt Kopf & Harr, P.C., and Rochelle McCullough, LLP as counsel. Brian A. Kilmer, Esq., at Okin Adams & Kilmer LLP, represents the Official Committee of Unsecured Creditors as counsel. HOVNANIAN ENTERPRISES: Signs Underwriting Pact with J.P. Morgan --------------------------------------------------------------- Hovnanian Enterprises, Inc., K. Hovnanian Enterprises, Inc., the Company's wholly-owned subsidiary, and the subsidiary guarantors named therein entered into an Underwriting Agreement, with J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC, relating to a public offering of 90,000 6.00% Exchangeable Note Units, each with a stated amount of $1,000. Pursuant to the terms of the Underwriting Agreement, K. Hovnanian granted the Underwriters a 13-day option to purchase up to an additional 10,000 Exchangeable Note Units to cover over- allotments, if any (which option was exercised in full by the Underwriters on Sept. 24, 2012). A copy of the Underwriting Agreement is available for free at http://is.gd/uNWuqC Also on Sept. 19, 2012, the Company, K. Hovnanian and the subsidiary guarantors entered into a Purchase Agreement, with Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC, relating to a private placement pursuant to Rule 144A and Regulation S under the Securities Act of 1933 of $577,000,000 aggregate principal amount of 7.25% Senior Secured First Lien Notes due 2020 and $220,000,000 aggregate principal amount of 9.125% Senior Secured Second Lien Notes due 2020 guaranteed by the Company and certain of its subsidiaries. The First Lien Notes and the guarantees thereof will be secured by a first-priority lien on substantially all of K. Hovnanian's, the Company's and the other guarantors' assets and the Second Lien Notes and the guarantees thereof will be secured by a second- priority lien on substantially all of K. Hovnanian's, the Company's and the other guarantors' assets, in both cases subject to permitted liens and certain exceptions. A copy of the Purchase Agreement is available for free at http://is.gd/XGbE0K About Hovnanian Enterprises Red Bank, New Jersey-based Hovnanian Enterprises, Inc. (NYSE: HOV) -- http://www.khov.com/-- founded in 1959 by Kevork S. Hovnanian, is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes and CraftBuilt Homes. As the developer of K. Hovnanian's Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes. The Company reported a net loss of $286.08 million for the fiscal year ended Oct. 31, 2011, compared with net income of $2.58 million during the prior fiscal year. The Company's balance sheet at July 31, 2012, showed $1.62 billion in total assets, $2.02 billion in total liabilities and a $404.20 million total deficit. * * * Hovnanian carries 'Caa2' corporate family and probability of default ratings from Moody's. Moody's said in April 2012 that the Caa2 corporate family rating reflects Hovnanian's elevated debt leverage weak gross margins, continued operating losses, negative cash flow generation, and Moody's expectation that the conditions in the homebuilding industry over the next one to two yeas will provide limited opportunities for improvement in the company's operating and financial metrics. In addition, the ratings consider Hovnanian's negative net worth position, which Moody's anticipates will be further weakened by continuing operating losses and impairment charges. As a result, adjusted debt leverage, currently standing at 149%, is likely to increase further. Hovnanian carries a 'CCC-' credit rating from Standard & Poor's and a 'CCC' issuer default rating from Fitch. IFINIX FUTURES: CFTC Wants Brokerage Banned From Trading -------------------------------------------------------- The U.S. Commodity Futures Trading Commission filed a civil enforcement action against registered independent introducing broker iFinix Futures, Inc., based in Plainview, N.Y., and iFinix's senior executive officer, Benhope Marlon Munroe of New Milford, Conn. iFinix has also done business under the name Pro- Active Futures. The CFTC complaint, filed in the U.S. District Court for the Eastern District of New York, charges the defendants with making false statements to, and concealing material facts from, the National Futures Association (NFA), the futures industry self- regulatory organization which is registered as a futures association with the CFTC. The complaint also charges defendants with failing to meet minimum financial requirements for an independent introducing broker. Specifically, the complaint alleges that, in and around July 2011, during an audit by the NFA, Munroe, while acting on behalf of iFinix, willfully made false statements and provided falsified bank documents to the NFA to conceal iFinix's failure to maintain adequate capital. According to the complaint, the defendants falsely represented that iFinix had $60,000 in available cash and provided bank account documents that had been altered to conceal the fact that iFinix did not have such cash. In addition, the complaint alleges that iFinix, with Munroe as its controlling person, failed to maintain adequate capital, failed to maintain required records, and failed to cease doing business as an independent introducing broker and provide notice to the NFA, futures commission merchants, and customers as soon as it knew or should have known that it had inadequate capital. In its continuing litigation, the CFTC seeks civil monetary penalties, a return of ill-gotten gains, trading and registration bans, and permanent injunctions against further violations of the federal commodities laws charged. The CFTC thanks the NFA for its cooperation and assistance. CFTC Division of Enforcement staff members responsible for this case are Douglas K. Yatter, Lara Turcik, Christopher Giglio, Manal M. Sultan, Lenel Hickson, Jr., Stephen J. Obie, and Vincent A. McGonagle. IPREO HOLDINGS: S&P Affirms 'B' Corp. Credit Rating; Outlook Pos ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its 'B' rating outlook on Ipreo Holdings LLC to positive from stable. Existing ratings on the company, including the 'B' corporate credit rating, were affirmed. "Our 'B' corporate credit rating on Ipreo Holdings reflects its narrow business focus, competition from much larger competitors with greater financial resources, and its revenue sensitivity to both changes in debt and equity securities issuance volume, and financial markets and interest rate volatility," said Standard & Poor's credit analyst Daniel Haines. These risks underscore Standard & Poor's Ratings Services' assessment of Ipreo's business risk profile as "weak" (based on S&P's criteria). "We regard the financial risk profile as 'highly leveraged,' reflecting the company's high debt to EBITDA (adjusted for operating leases) of 5.5x, based on the trailing-12-month EBITDA as of June 30, 2012." "Ipreo is a financial services technology, research, and data provider. The company operates in three segments: capital markets (50% of revenue for the 12 months ended June 30, 2012), research, sales & trading (RS&T) (24%), and corporate (26%). The capital markets segment provides software workflow solutions to automate debt, equity and municipal securities marketing, issuance, and purchase. The company's revenue, especially from municipal debt issuances, is highly dependent on new issuance transaction volumes and activity levels at its large investment banking and brokerage clients. We estimate approximately 50% to 60% of revenues in the capital markets segment are transaction related--and therefore inherently variable. The RS&T and corporate segments provide client relationships, market intelligence, and analytics products and solutions to the investment community and corporate investor relations groups. These segments are less sensitive to capital market volumes, serve a broader client base than the capital markets segment, and offer a degree of stability. About 85% of revenues across these two segments are subscription based," S&P said. "We believe the embedded nature of Ipreo's software products and services, and expanding market opportunities, will support revenue growth over the balance of 2012 and in 2013. We also believe that debt issuance could continue to be strong with significant corporate debt funding needs, low interest rates, and healthy investor appetite. According to the Securities Industry and Financial Markets Association, U.S. municipal issuance has increased by over 50% year to date through August 2012. For 2013, we expect capital markets activity to be flat or modestly higher than 2012 levels," S&P said. J T THOMPSON: Lawyer Won't Get Paid for Violating Disclosure Rules ------------------------------------------------------------------ Bankruptcy Judge Peter Carroll denied the Amended First and Final Application for Compensation and Reimbursement of Expenses of the Law Offices of Vincent W. Davis, counsel for J.T. Thompson, USA, after the law firm violated the disclosure requirements of 11 U.S.C. Section 329(a) and Fed.R.Bankr.P. 2016(b). Davis certified in its Rule 2016(b) Disclosure that the firm (1) had not received any compensation for legal services rendered, or to be rendered on behalf of Thompson in contemplation of or in connection with the bankruptcy case; (2) had agreed to accept no compensation for such services; and (3) that the balance due on the date of bankruptcy for such services was zero. That statement was false. Davis had, in fact received at least a $25,000 retainer prior to bankruptcy, and had deducted the sum of $2,275 from its retainer as compensation for pre-petition services rendered to Thompson in contemplation of or in connection with its bankruptcy case. Davis did not correct or supplement its Rule 2016(b) Disclosure until after the Court reminded Davis of the strict requirements of FRBP 2016(b) at the status conference on July 11, 2012, and the case converted to chapter 7. Davis also presented false information regarding the retainer in its original employment application, stating under penalty of perjury that it had received a $40,000 retainer from Thompson prior to bankruptcy. Davis then compounded the inaccurate disclosures by conflicting representations at the status conference at which Artin T. Derohanian, who appeared for Thompson on behalf of the Davis firm, (1) initially stated that the firm had not, to his knowledge, received any pre-petition retainer; (2) then stated that Davis had not received a $40,000 prepetition retainer, but had in fact received a $25,000 retainer prior to the filing of the petition and intended to seek an additional $15,000 retainer at a later date; and (3) then stated that Davis had, in fact, received a $40,000 prepetition retainer when it had not. Davis's request for final allowance and payment of $22,725 in fees, plus $1,803.55 in expenses is denied, and Davis is ordered to disgorge and turn over to the Chapter 7 trustee for Thompson the balance of its retainer in the amount of $22,725 for the benefit of the estate. The United States trustee and Alberta P. Stahl, the Chapter 7 Trustee for Thompson, object to Davis' fee request. A copy of the Court's Sept. 25, 2012 Memorandum Decision is available at http://is.gd/LE4Cwdfrom Leagle.com. J.T. Thompson, USA, filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 12-26473) on May 9, 2012. Thompson's petition was signed by Chin-Ming Tsai, Sr., as President and CEO of the corporation. On May 23, 2012, Thompson filed a Summary of Schedules, Schedules A through H, Statement of Financial Affairs, Statement of Related Cases, and a Disclosure of Compensation of Attorney for Debtor. The information contained in Thompson's schedules was conflicting and incorrect. The schedules named creditors that were not identified on the verified creditor matrix originally filed with the court. In Schedule A, Thompson listed as one of its only two significant assets the real property at 17053 Foothill, Blvd., Fontana, California, valued at $1,006,732. In Schedule D, Thompson disclosed Royal Business Bank as the holder of a claim in the amount of $1,222,286 secured by an "interest" in vacant land in Fontana, California -- presumably the Foothill Property. Thompson then valued the property in Schedule D at $1,000,000. Thompson disclosed its other significant asset in Schedule B(16) as ownership of an account receivable in the amount of $112,784. The disclosure contained the following notation: "Amount of cash is "frozen" by state court order[.] See Mei Yun Yang v. J.T. Thompson USA, et al[.,] Case No. GC 049025[,] Superior Court of California[,] County of Los Angeles." Tsai signed Thompson's schedules and statements under penalty of perjury. At a status conference on July 11, the Court learned that the Foothill Property was not owned by Thompson, but by Foothill, LLC -- a limited liability company in which Thompson owned a 40% interest. The court also learned that the $112,784 account receivable was, in fact, funds on deposit in an account at East West Bank attributable to the sale of certain real property owned by San Gabriel Senior Garden, LLC -- a limited liability company in which Thompson owned a 35% interest. Thompson was prohibited from withdrawing the funds by a "Temporary Protective Order" entered in Case No. GC049025, styled Yang v. J.T. Thompson, USA, et al., in the Superior Court of California, County of Los Angeles pending an adjudication of disputed claims to the funds among the SGSG interest holders. Thompson's bankruptcy petition was filed primarily to stay the state court litigation and essentially to collaterally attack the Temporary Protective Order. Thompson opposed a motion by Mei Yun Yang, Tsai's sister and the plaintiff in the state court action, seeking relief from the stay to continue the lawsuit. Thompson also filed a complaint in Adversary No. 2:12-ap-01796-PC, J.T. Thompson USA v. East West Bank, et al., seeking to compel a turnover of the funds and to secure an injunction against further litigation of the state court action against Thompson's principals, Tsai, Pao Ching Tsai, and Chieh Lin Tsai, pursuant to Sec. 105(a). The court also learned at the status conference that Thompson was essentially an investment vehicle for the Tsai family. Thompson had no employees other than its principals, no other significant real or personal property, and no business plan. Thompson had not filed an operating report since the commencement of the case, and the creditors' meeting had not been conducted because Tsai, who has resided in Taiwan since 2011, was too ill to attend a creditors' meeting and personally respond to questions under oath regarding the petition, schedules and statements that he signed and filed with the court on behalf of the corporation. At the conclusion of the status conference, the Court converted the case to a case under chapter 7 pursuant to Sec. 1112(b), and appointed Alberta P. Stahl as trustee. JOHN BECK: Files for Bankruptcy After $479-Million Fine ------------------------------------------------------- John Beck, the owner of a get-rich-quick scheme, filed for bankruptcy in California federal court (Bankr. N.D. Calif. Case No. 12-47882) on Sept. 24, 2012. Max Stendahl at Bankruptcy Law360 reports that Mr. Beck sought bankruptcy one month after he was fined a record $478.9 million for deceiving nearly a million consumers through phony real estate programs. John Beck estimated assets of between $1 million and $10 million and liabilities of between $100 million and $500 million. The Federal Trade Commission was listed among Beck's creditors. LAUSELL INC: Amends Schedules of Assets and Liabilities ------------------------------------------------------- Lausell, Inc., filed with the Bankruptcy Court for the District of Puerto Rico its amended schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $4,300,000 B. Personal Property $29,759,950 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $12,583,512 E. Creditors Holding Unsecured Priority Claims $501,726 F. Creditors Holding Unsecured Non-priority Claims $11,404,176 ----------- ----------- TOTAL $34,059,950 $24,489,414 The company valued the property at $29,760,970 in the prior iteration of the schedules, where it disclosed total assets of $37.7 million in assets and liabilities of $24.5 million. Lausell, Inc., filed a bare-bones Chapter 11 petition (Bankr. D.P.R. Case No. 12-02918) on April 17, 2012 in Old San Juan, Puerto Rico. Lausell, also known as Aluminio Del Caribe, is a manufacturer of windows and doors. Bankruptcy Judge Mildred Caban Flores oversees the case. Charles Alfred Cuprill, Esq., at Charles A. Curpill, PSC, serves as counsel to the Debtor. LAUSELL INC: Hires Charles A. Cuprill as Attorney ------------------------------------------------- Lausell, Inc., asks the U.S. Bankruptcy Court for permission to employ Charles A. Cuprill, P.S.C., as legal counsel. The company retained the firm on the basis of a $35,000 retainer. The firm's hourly rates are: Professional Rates ------------ ----- Charles A. Cuprill, Esq. $350 Senior Associates $225 Junior Associates $125 Paralegals $85 The Debtor attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Lausell, Inc., filed a bare-bones Chapter 11 petition (Bankr. D.P.R. Case No. 12-02918) on April 17, 2012, in Old San Juan, Puerto Rico. Lausell, also known as Aluminio Del Caribe, is a manufacturer of windows and doors. Bankruptcy Judge Mildred Caban Flores oversees the case. Charles Alfred Cuprill, Esq., at Charles A. Curpill, PSC, serves as counsel to the Debtor. The Bayamon, Puerto Rico-based company disclosed $34,059,950 in assets and liabilities of $24,489,414 in its amended schedules. LEVEL 3 COMMUNICATIONS: S&P Rates $1.2 Billion Term Loan 'B+' ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' issue-level rating and '1' recovery rating to Level 3 Financing Inc.'s $1.2 billion term loan (tranche B-II 2019) due 2019. Level 3 Financing Inc. is a wholly owned subsidiary of Broomfield, Colo.-based Level 3 Communications Inc. (Level 3). "The '1' recovery rating on this senior secured loan reflects our expectation of very high (90% to 100%) recovery of principal in the event of a default. The new facility will repay an aggregate of $1.2 billion of two term loans (tranches B-II and B-III) due 2018. Other ratings on Level 3 and subsidiaries, including the 'B-' corporate credit rating and the positive outlook, are not affected by the new notes. Approximately $8.4 billion of debt was reported at June 30, 2012 (excluding third-quarter financing transactions)," S&P said. "Level 3 is a facilities-based, global integrated provider of a range of communications services including voice, data, and broadband on its extensive long-haul and metropolitan fiber networks. The company's October 2011 $3 billion acquisition of Global Crossing Ltd. expanded its footprint, especially in Latin America. Level 3 noted that as of the second quarter of this year, it had realized about 40% of what it ultimately projects to be $300 million of operating synergies from the Global Crossing acquisition. The positive outlook cites the potential for a one- notch upgrade if Level 3 demonstrates that it is successfully integrating Global Crossing and, further, is on track to realize at least the bulk of projected operating synergies," S&P said. RATINGS LIST Level 3 Communications Inc. Corporate Credit Rating B-/Positive/-- New Ratings Level 3 Financing Inc. $1.2 bil. term loan due 2019 B+ Recovery Rating 1 LIFEPOINT HOSPITALS: Moody's Raises Corp. Family Rating to 'Ba2' ---------------------------------------------------------------- Moody's Investors Service upgraded LifePoint Hospitals Inc.'s Corporate Family and Probability of Default Ratings to Ba2 from Ba3. Moody's also affirmed the rating on the company's senior secured credit facilities and upgraded the rating on its senior subordinated debt. The ratings outlook is stable. Following is a summary of Moody's rating actions: Ratings upgraded: Corporate Family Rating to Ba2 from Ba3 Probability of Default Rating to Ba2 from Ba3 3.25% convertible senior sub notes due 2025 to Ba3 (LGD 5, 82%) from B2 (LGD5, 82%) Ratings affirmed with LGD rates adjusted Senior secured revolver expiring 2017 to Ba1 (LGD 2, 28%) from Ba1 (LGD 2, 27%) Senior secured term loan A due 2017 to Ba1 (LGD 2, 28%) from Ba1 (LGD 2, 27%) 6.625% senior unsecured notes due 2020 to Ba1 (LGD 2, 28%) from Ba1 (LGD 2, 27%) Speculative Grade Liquidity Rating, SGL-2 "The upgrade of LifePoint's Corporate Family Rating reflects our expectation that the company will maintain a disciplined approach to the use of additional leverage as it pursues acquisitions and continues to repurchase shares," said Dean Diaz, a Moody's Senior Credit Officer. "LifePoint's operating results should continue to benefit from recent acquisitions and other investments that have been funded with the company's stable cash flow," continued Diaz. Ratings Rationale LifePoint's Ba2 Corporate Family Rating reflects Moody's expectation that the company's operating performance will result in strong interest coverage and cash flow coverage of debt. Leverage is expected to remain moderate and could increase modestly as the company pursues acquisitions. Therefore, Moody's does not expect a near term reduction in debt as the company deploys free cash flow to acquisitions and share repurchase activity. The rating also incorporates Moody's expectation of a continuation of the difficult operating environment characterized by increasing bad debt expense and weak volume trends. Given the expectation that leverage will not likely decline meaningfully beyond current levels and could increase modestly, Moody's does not expect an upgrade in the near term. However, Moody's could upgrade the rating if the company continues to grow earnings through acquisitions that do not significantly disrupt operations or require a material use of incremental debt, such that debt to EBITDA is sustained at or below 3.0 times. Moody's could downgrade the rating if it believes LifePoint's financial policy is changing and aggressively pursues debt financed acquisitions or share repurchases or if the company experiences operating challenges such that leverage was expected to approach 4.0 times. For further details, refer to Moody's Credit Opinion for LifePoint Hospitals, Inc. on moodys.com. The principal methodology used in rating LifePoint was the Global Healthcare Service Providers 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. Headquartered in Brentwood, Tennessee, LifePoint is a leading operator of general acute care hospitals with operations predominantly in non-urban communities. The company generated revenue of approximately $3.7 billion for the twelve months ended June 30, 2012. LIQUIDMETAL TECHNOLOGIES: To Issue 30-Mil. Shares Under Plan ------------------------------------------------------------ Liquidmetal Technologies, Inc., filed with the U.S. Securities and Exchange Commission a Form S-8 registration statement listing 30 million shares of common stock issuable under the Company's 2012 Equity Incentive Plan. The proposed maximum aggregate offering price is $6.45 million. A copy of the Form S-8 prospectus is available for free at http://is.gd/zMs73O About Liquidmetal Technologies Based in Rancho Santa Margarita, Calif., Liquidmetal Technologies, Inc., and its subsidiaries are in the business of developing, manufacturing, and marketing products made from amorphous alloys. Liquidmetal Technologies markets and sells Liquidmetal(R) alloy industrial coatings and also manufactures, markets and sells products and components from bulk Liquidmetal alloys that can be incorporated into the finished goods of its customers across a variety of industries. The Company also partners with third- party licensees and distributors to develop and commercialize Liquidmetal alloy products. After auditing the 2011 financial statements, Choi, Kim & Park, LLP, in Los Angeles, California, said that the Company's significant operating losses and working capital deficit raise substantial doubt about its ability to continue as a going concern. The Company's balance sheet at June 30, 2012, showed $3.02 million in total assets, $8.24 million in total liabilities, and a $5.21 million total shareholders' deficit. LYB FINANCE: S&P Rates $300MM Sr. Unsecured Notes 'BB+' ------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' rating to the existing $300 million 8.1% senior unsecured notes due 2027 issued by LYB Finance Co. BV (formerly Montell Finance Co. B.V.). "At the same time, we affirmed all our ratings on LyondellBasell Industries N.V., including the 'BBB-' corporate credit rating. The outlook is stable," S&P said. "The ratings reflect the company's 'fair' business risk profile and 'intermediate' financial risk profile," said credit analyst Cynthia Werneth. "We rate the senior unsecured debt of both LyondellBasell and LYB Finance one notch below the corporate credit rating because we view these obligations as structurally subordinated to liabilities at LyondellBasell's operating subsidiaries." "The outlook is stable. LyondellBasell operates in a cyclical industry. Results could weaken somewhat in the coming quarters if global economic conditions deteriorate, particularly in Europe, where LyondellBasell has substantial and higher-cost operations. Longer-term, earnings and cash flow could suffer if supply growth exceeds demand growth. We expect LyondellBasell to maintain ratios appropriate for the rating, including an FFO-to-total debt ratio averaging at least 40% to 45% and remaining near 30% even in industry troughs. We believe the company can maintain a sufficiently strong financial profile to support the rating even if revenues drop by 20% and EBITDA margins decline to 7% from trailing-12-month levels of about 11%. Also key to maintaining the ratings are the continuation of prudent financial policies and sufficient liquidity," S&P said. "We could lower the ratings if there were an unexpected shift in financial policies, such that shareholder returns are more aggressive than we expect or the company pursues very large debt- funded acquisitions or capital investments, even if they are financed off balance sheet," S&P said. "During the next few years, we could consider a slightly higher rating if LyondellBasell improves its business risk profile to 'satisfactory' by making investments that promote increased stability and diversification, and the company continues to perform strongly and maintain prudent financial policies," S&P said. LYTHGOE PROPERTIES: Court Denies Bid to Amend Confirmed Plan ------------------------------------------------------------ Bankruptcy Judge Herb Ross in Alaska denied the request of Lynn H. Lythgoe Jr. to amend the confirmed amended plan of reorganization in the Chapter 11 cases of Mr. Lythgoe, Jr., and Lythgoe Properties, LLC. The Debtors seek to amend the treatment "Class S-5: IndyMac Bank" of the confirmed plan. The Court, however, denied the request and instead set a status conference on Debtor's objection to the claim filed by OneWest Bank. The Court said the matter is better addressed by resolving the claim objection. At the status conference, the Court will address a procedure to resolve the objection. Among others, the Court noted that approval of the plan amendment might entail a cram-down hearing, the expense of which will far outweigh any financial benefit to either side. There is a sharp dispute amongst bankruptcy courts, unresolved in the Alaska bankruptcy court or the Ninth Circuit, as to whether the absolute priority rule applies to an individual chapter 11 case. As an aside, the Court added, the motion is presented with indifference to the court and other readers. The docket now has over 900 entries. The motion does not deign to cite to docket numbers or set out key wording verbatim. It left it to the court to laboriously dig through the record to analyze the situation, instead of being pointed to the key documents. The Court also noted that "apparently there was a sale for enough (or, almost enough) to pay off the OneWest/IndyMac obligation." The Debtor's motion shows that $369,347.61 was available for the creditor on May 18, 2011. However, there was a dispute between OneWest and the Lythgoes as to whether there had been a prior reduction in the interest rate -- the Lythgoes says yes and the creditor says no -- so the sale fell through. After the sale fell through, the Debtor filed a claim objection. Since there was no pending sale, at a hearing on Aug. 5, 2011, the Court asked the parties to try to reach a compromise, or at least close a sale and hold any excess proceeds, subject to a court ruling on the objection. A copy of the Court's Sept. 25, 2012 Memorandum is available at http://is.gd/wWElu3from Leagle.com. Eagle River, Alaska-based Lythgoe Properties, LLC, filed for Chapter 11 bankruptcy protection on Dec. 28, 2009 (Bankr. D. Alaska Case No. 09-00966). John C. Siemers, Esq., at Burr, Pease & Kurtz assists the Company in its restructuring effort. The Company listed $10 million to $50 million in both assets and debts. Lynn H. Lythgoe, Jr., based in Anchorage, filed for Chapter 11 (Bankr. D. Alaska Case No. 07-00658) on Dec. 17, 2007. Mr. Siemers serves as bankruptcy counsel. Mr. Lythgoe estimated $1 million to $10 million in assets and debts. The cases are jointly administered. The Debtors filed a Second Amended Joint Plan of Reorganization on Oct. 6, 2010. The Court entered an amended confirmation order on Dec. 17, 2010. MEDFORD VILLAGE: Files Schedules of Assets and Liabilities ---------------------------------------------------------- Medford Village East Associates, LLC, filed with the Bankruptcy Court for the District of New Jersey its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $59,625,000 B. Personal Property $6,326,199 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $7,852,156 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $2,123,846 ----------- ----------- TOTAL $65,951,199 $9,976,003 Medford Village East Associates, LLC, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 12-29693) in Camden on Aug. 8, 2012. The Debtor owns properties in Medford Township, Mt. Laurel Township, Borough of Clayton, Borough of Barrington, Voorhees Township and the Midwest. The Debtor hired Maschmeyer Karalis P.C. as bankruptcy counsel and Hyland Levin, LLP as special counsel. The petition was signed by Stephen D. Samost, managing member. MEDFORD VILLAGE: Court OKs Maschmeyer Karalis as Attorney --------------------------------------------------------- Medford Village East Associates, LLC, sought and obtained approval from the U.S. Bankruptcy Court to employ Maschmeyer Karalis PC as attorney for the Debtor. Medford Village also obtained approval to employ Hyland Levin LLP as special counsel. Medford Village East Associates, LLC, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 12-29693) in Camden on Aug. 8, 2012, disclosing $65,951,199 in assets and $9,976,003 in liabilities. The Debtor owns properties in Medford Township, Mt. Laurel Township, Borough of Clayton, Borough of Barrington, Voorhees Township and the Midwest. The Debtor hired Maschmeyer Karalis P.C. as bankruptcy counsel and Hyland Levin, LLP as special counsel. The petition was signed by Stephen D. Samost, managing member. MEDIA GENERAL: Issues 4.6 Million Class A Shares to Berkshire ------------------------------------------------------------- Berkshire Hathaway, Inc., on Sept. 24, 2012, exercised warrants to purchase 4,646,220 shares of Class A common stock, par value $5.00 per share, of the Company for an aggregate purchase price of $46,462.20, or $0.01 per share. The warrants were issued pursuant to a warrant agreement dated as of May 24, 2012, in connection with a new credit agreement dated as of May 17, 2012. The number of shares of Class A common stock purchased upon exercise of the warrants represents approximately 19.9 percent of Media General's outstanding common stock and results in Berkshire Hathaway owning approximately 16.6% of Media General's outstanding common stock following the issuance of the shares to Berkshire Hathaway. The shares issued are exempt from registration under the Securities Act of 1933 pursuant to section 4(a)(2), because the transaction with Berkshire Hathaway did not involve any public offering. As previously disclosed, Berkshire Hathaway has the right to request that the Company register the foregoing shares pursuant to a Registration Rights Agreement dated as of May 24, 2012. About Media General Richmond, Virginia-based Media General Inc. (NYSE: MEG) -- http://www.mediageneral.com/-- is an independent communications company with interests in newspapers, television stations and interactive media in the United States. The Company reported a net loss of $74.32 million for the fiscal year ended Dec. 25, 2011, a net loss of $22.64 million for the fiscal year ended Dec. 26, 2010, and a net loss of $35.76 million for the fiscal year ended Dec. 27, 2009. The Company's balance sheet at June 24, 2012, showed $923.41 million in total assets, $1.05 billion in total liabilities, and a $129.26 million total stockholders' deficit. * * * As reported by the Troubled Company Reporter on April 12, 2012, Moody's Investors Service downgraded, among other things, Media General's Corporate Family Rating (CFR) and Probability of Default Rating (PDR) to Caa1 from B3, concluding the review for downgrade initiated on Feb. 13, 2012. The downgrade reflects the significant increase in interest expense associated with the company's credit facility amend and extend transaction and an assumed issuance of at least $225 million of new notes, which will result in limited free cash flow generation and constrain Media General's capacity to reduce its very high leverage. The weak free cash flow and high leverage create vulnerability to changes in the company's highly cyclical revenue and EBITDA generation. According to the May 23, 2012 edition of the TCR, Standard & Poor's Ratings Services placed its 'CCC+' corporate credit rating on Media General, along with its 'CCC+' issue-level rating on the company's senior secured notes, on CreditWatch with positive implications. "The CreditWatch placement is based on Media General's agreement to sell the majority of its newspaper assets to BH Media Group, a subsidiary of Berkshire Hathaway Inc. The CreditWatch also reflects the announcement that the company will refinance its existing bank debt due in March 2013. It expects to close the refinancing transaction next week and the newspaper sale by June 25, 2012," S&P said. MICHAELS STORES: Inks $200MM Purchase Pact with Deutsche, et al. ---------------------------------------------------------------- Michaels Stores, Inc., and certain of its subsidiaries, as guarantors, entered into a Purchase Agreement with Deutsche Bank Securities Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Capital Inc., Credit Suisse Securities (USA) LLC, Goldman, Sachs & Co, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Wells Fargo Securities, LLC, relating to the sale of an additional $200,000,000 aggregate principal amount of its 7 3/4% Senior Notes due 2018. The Notes will be sold through a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The Notes have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold absent registration under the Securities Act or applicable state securities laws or applicable exemptions from registration requirements. The Purchase Agreement contains customary representations, warranties and agreements by the Company and indemnification provisions whereby the Company and the Guarantors, on one hand, and the Initial Purchasers, on the other, have agreed to indemnify each other against certain liabilities. The offering is expected to close on Sept. 27, 2012, subject to satisfaction of customary closing conditions. The Company plans to use the net proceeds from this offering to repay a portion of the indebtedness outstanding under the Company's B-1 Term Loans under its Senior Secured Term Loan Facility and to pay related fees and expenses. A copy of the Purchase Agreement is available for free at: http://is.gd/lDUWbg About Michaels Stores Headquartered in Irving, Texas, Michaels Stores, Inc., is the largest arts and crafts specialty retailer in North America. As of March 9, 2009, the Company operated 1,105 "Michaels" retail stores in the United States and Canada and 161 Aaron Brothers Stores. The Company's balance sheet at July 28, 2012, showed $1.68 billion in total assets, $4.09 billion in total liabilities, and a $2.40 billion total stockholders' deficit. * * * As reported by the TCR on April 5, 2012, Moody's Investors Service upgraded Michaels Stores, Inc.'s Corporate Family Rating to B2 from B3. "The upgrade of Michaels' Corporate Family Rating primarily reflects the positive benefits of its continuing business initiatives which have led to consistent improvements in same store sales," said Moody's Vice President Scott Tuhy. In the April 16, 2012, edition of the TCR, Standard & Poor's Ratings Services raised its corporate credit rating on Irving, Texas-based Michaels Stores Inc. to 'B' from 'B-'. "Standard & Poor's Ratings Services' upgrade on Michaels Stores reflects the improvement in financial ratios following the company's performance in the important fourth quarter, given the seasonality of the company's business," said Standard & Poor's credit analyst Brian Milligan. "The CreditWatch placement remains effective, given the pending IPO." MOTORSPORT RANCH: Section 341(a) Meeting Scheduled for Oct. 2 ------------------------------------------------------------- The U.S. Trustee for Region 7 will convene a Meeting of Creditors under U.S.C. Sec. 341(a) in the Chapter 11 case of MotorSport Ranch Houston, LLC, on Oct. 2, 2012, at 11:00 a.m. at 515 Rusk Street, Suite 3401, in Houston, Texas. Proofs of claims are due by Dec. 31, 2012. Angleton, Texas-based MotorSport Ranch Houston, LLC, dba MotorSport Properties, Ltd., and MSR Houston filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 12-36422) on Aug. 30, 2012, in Houston. Judge David R. Jones oversees the case. The Debtor scheduled $13,660,374 in assets and $6,502,902 in liabilities. The petition was signed by James A. Redmond, president. MOTORSPORT RANCH: Can Employ J. Craig Cowgill as Counsel -------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas authorized MotorSport Ranch Houston, LLC, to employ J. Craig Cowgill & Associates, P.C., as Debtor's Chapter 11 counsel. As reported in the TCR on Sept. 5, 2012, Mr. Cowgill charges $500 an hour and his associate attorney bills $400 an hour. The paralegal/law clerk bills from $95 to $150 an hour. Mr. Cowgill attests his firm represents no adverse interest to the Debtor or the estate. Angleton, Texas-based MotorSport Ranch Houston, LLC, dba MotorSport Properties, Ltd., and MSR Houston filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 12-36422) on Aug. 30, 2012, in Houston. Judge David R. Jones oversees the case. The Debtor scheduled $13,660,374 in assets and $6,502,902 in liabilities. The petition was signed by James A. Redmond, president. MSR RESORT: Wins Court Approval for $1.5BB Stalking Horse Deal -------------------------------------------------------------- Lisa Uhlman at Bankruptcy Law360 reports that U.S. Bankruptcy Judge Sean H. Lane judge gave the go-ahead Monday night to bankrupt MSR Resort Golf Course LLC's $1.5 billion stalking horse agreement with affiliates of Government of Singapore Investment Corp., setting a Nov. 8 auction date for the resort owner's assets. About MSR Resort MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc., owns a portfolio of eight luxury hotels with over 5,500 guest rooms, including the Arizona Biltmore Resort & Spa in Phoenix, the Ritz-Carlton in Orlando, Fla., and Hawaii's Grand Wailea Resort Hotel & Spa in Maui. On Jan. 28, 2011, CNL-AB LLC acquired the equity interests in the portfolio through a foreclosure proceeding. CNL-AB LLC is a joint venture consisting of affiliates of Paulson & Co. Inc., a joint venture affiliated with Winthrop Realty Trust, and affiliates of Capital Trust, Inc. Morgan Stanley's CNL Hotels & Resorts Inc. owned the resorts before the Jan. 28 foreclosure. Following the acquisition, five of the resorts with mortgage debt scheduled to mature on Feb. 1, 2011, were sent to Chapter 11 bankruptcy by the Paulson and Winthrop joint venture affiliates. MSR Resort Golf Course LLC and its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan on Feb. 1, 2011. The resorts subject to the filings are Grand Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta Resort and Club and PGA West, Doral Golf Resort and Spa, and Claremont Resort and Spa. James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O. Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis, LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The five resorts had $2.2 billion in assets and $1.9 billion in debt as of Nov. 30, 2010, according to court filings. In its schedules, debtor MSR Resort disclosed $59,399,666 in total assets and $1,013,213,968 in total liabilities. The resorts have agreement with lenders allowing the companies to remain in Chapter 11 at least until September 2012. The Official Committee of Unsecured Creditors is represented by Martin G. Bunin, Esq., and Craig E. Freeman, Esq., at Alston & Bird LLP, in New York. MUNDY RANCH: Files Schedules of Assets and Liabilities ------------------------------------------------------ Mundy Ranch filed with the U.S. Bankruptcy Court for the District of New Mexico its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $19,560,000 B. Personal Property $695,390 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $2,095,000 E. Creditors Holding Unsecured Priority Claims $43,111 F. Creditors Holding Unsecured Non-priority Claims $3,554,289 ----------- ----------- TOTAL $20,255,390 $5,692,401 New Mexico's Mundy Ranch -- http://www.mundyranch.com/-- offers a "fine edge on ranch living with style." The Mundy family-owned Mundy Ranch spans granite slopes and fertile bottom lands of the Chama River Valley, has 25 alpine lakes with trophy trout, and a mile of freestone river lined with towering Pines. Mundy Ranch is offering for sale 42-140 acre ranch parcels, with parcel pricing starting at $1 million to $3 million depending on location. It is also offering 20 lifetime recreational memberships at a price of $500,000 each. Mundy Ranch, Inc., filed a Chapter 11 petition (Bankr. D. N.M. Case No. 12-13015) in Albuquerque, New Mexico. The Law Office of George Dave Giddens, PC, in Albuquerque, serves as counsel. The Debtor estimated assets of $10 million to $50 million and debts of up to $10 million. MUNDY RANCH: Court Approves George Dave Giddens as Attorney ----------------------------------------------------------- Mundy Ranch sought and obtained approval from the U.S. Bankruptcy Court to employ Christopher M. Gatton, Esq., at the Law Office of George Dave Giddens, PC, in Albuquerque, as counsel. The Debtor will employ the firm based on the hourly rates of its professionals: Hourly Rate ----------- George Dave Giddens $295 Patricia A. Bradley $200 Ann Washburn $175 Dean Cross $175 Denise J. Trujillo $170 Chris M. Gatton $170 Legal Assistants $90 New Mexico's Mundy Ranch -- http://www.mundyranch.com/-- offers a "fine edge on ranch living with style." The Mundy family-owned Mundy Ranch spans granite slopes and fertile bottom lands of the Chama River Valley, has 25 alpine lakes with trophy trout, and a mile of freestone river lined with towering Pines. Mundy Ranch is offering for sale 42-140 acre ranch parcels, with parcel pricing starting at $1 million to $3 million depending on location. It is also offering 20 lifetime recreational memberships at a price of $500,000 each. Mundy Ranch, Inc., filed a Chapter 11 petition (Bankr. D. N.M. Case No. 12-13015) in Albuquerque, New Mexico. The Law Office of George Dave Giddens, PC, in Albuquerque, serves as counsel. The Debtor estimated assets of $10 million to $50 million and debts of up to $10 million. NALLS DEVELOPMENT: Can Employ Richard Rosenbltt as Counsel ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Columbia authorized Nalls Development and Investment, LLC, to employ Richard B. Rosenblatt, PC, as counsel for the Debtor. As reported in the TCR on Sept. 6, 2012, the Debtor had previously retained Jeffery Tuckfelt to represent it in the Chapter 11 case. The Debtor said Mr. Tuckfelt's efforts and the efforts of the Rosenblatt firm will not overlap. The Rosenblatt firm will take over the active work and advise the Debtor on a go forward basis. The firm attests it is a "disinterested person" as that term is defined by 11 U.S.C. Sec. 101(14). The Rosenblatt firm's hourly rates are $350 an hour for experienced bankruptcy attorneys, Richard B. Rosenblatt and Linda M. Dorney; $295 an hour for time billed by other firm attorneys; and $125 an hour for paralegal time. About Nalls Development and Investment Nalls Development and Investment, LLC, filed a Chapter 11 petition (Bankr. D.D.C. Case No. 12-00512) on July 18, 2012. The Debtor -- http://nallsdevelopment.com/-- said its principal assets are in 200-210 Elmira Street, SW and others in Washington, D.C. It serves Martin's View apartments, Mount Dome Apartments, Suitland Forest Apartments, and 1900 16th St. Apartments. Judge S. Martin Teel, Jr., oversees the case. Jeffrey C. Tuckfelt, Esq., at Obergh and Berlin, was initially tapped as bankruptcy counsel. The Debtor later turned to the Law Offices of Richard B. Rosenblatt, PC. The petition was signed by Arthur Nalls, Jr., managing member. In its schedules, the Debtor disclosed $7,066,835 in total assets and $8,538,457 in total liabilities. NECKERMANN.DE GMBH: To Close Down in Line With Insolvency Law ------------------------------------------------------------- Natali Schwab at Dow Jones' Daily Bankruptcy Review reports that German mail-order retailer Neckermann.de GmbH will be closed down in line with insolvency laws as no investor has been found to bail out the insolvent entity, Neckermann's insolvency administrator said. NORTHERN MARIANA: Moody's Confirms 'B2' Rating on G.O. Bonds ------------------------------------------------------------ Moody's Investors Service has removed from review and confirmed the B2 rating on the Commonwealth of Northern Mariana Islands' General Obligation Bonds, Series 2003A. The rating was placed on review on May 4 due to the lack of sufficient current financial and operating information. Since that time, Moody's has received audited financial results for fiscal year 2010, unaudited financial information for 2011, and budget information for 2012 and 2013. There are $1.7 million of rated bonds outstanding. Summary Rating Rationale The B2 rating reflects the Commonwealth's small, concentrated economy which has experienced a significant decline due to the loss of the garment industry; strained financial results characterized by persistent operating deficits; and a large and growing unfunded pension liability. Also factored into the rating are weaknesses in financial reporting exhibited by delayed release of audited financial statements. Strengths * Debt levels are low compared to other US territories and commonwealths. * Rated debt matures in October 2013. * After severe declines driven by loss of the garment industry, economy and government revenues show signs of stabilization. Challenges * Financial results show persistent General Fund operating deficits and a large accumulated General Fund balance sheet deficit. * Financial reporting is weak. * No plans are in place to address large unfunded pension liability. * Small economy is dominated by volatile tourism industry. What Could Move The Rating - UP * Significant improvement in financial management and results, including movement to structural balance. * Adoption of a funded plan to reduce the unfunded pension liability. * Sustained economic growth and diversification. What Could Move The Rating - DOWN * Further economic deterioration. * A deterioration in the government's cash position. * Further weakening in financial reporting. The principal methodology used in this rating was Moody's State Rating Methodology published in November 2004. NORTHERN PLAINS: Placed Into Liquidation in South Dakota -------------------------------------------------------- Northern Plains Insurance Company, Inc., was placed into liquidation by the State of South Dakota, County of Hughes Sixth Judicial Court on Sept. 18, 2012. Merle Scheiber, Director of Insurance for the State of South Dakota, was appointed Liquidator. Also on Sept. 18, Merle Scheiber appointed Michael FitzGibbons of FitzGibbons and Company, Inc. as Special Deputy Liquidator. All persons who may have claims against the Company must file a verified original Proof of Claim (POC). A statement posted on Northern Plains' Web site said all policies in effect at the time of issuance of an Order of Liquidation continue in force only for the lesser of: (1) 30 days from the date of entry of the liquidation order (i.e. October 18, 2012 at 11:59 pm CST); (2) the expiration of the policy coverage; (3) the date when the insured has replaced the insurance coverage with equivalent insurance with another insurer or otherwise terminated the policy; or (4) the Liquidator has effected a transfer of the policy obligation. The deadline for filing proof of claim is Dec. 15, 2012. Northern Plains Insurance Company, Inc., is a Watertown, South Dakota-based insurance company. PDC ENERGY: Moody's Assigns 'B3' Rating to Sr. Unsecured Notes -------------------------------------------------------------- Moody's Investors Service assigned a B3 rating to PDC Energy, Inc.'s (PDC) senior unsecured notes due 2022. Note proceeds will be used to fund the proposed redemption of PDC's 12% senior notes, to repay certain other indebtednedd and for other general corporate purposes. The rating outlook is positive. "This notes issue will extend the maturity profile of PDC's debt, at a more competitive coupon, and provide incremental liquidity to the company as it continues to grow scale and grow its liquids production," commented Andrew Brooks, Moody's Vice President. Ratings Rationale PDC's B2 Corporate Family Rating (CFR) reflects its smaller scale and concentration in the Rocky Mountain region, offset by its moderate finding and development (F&D) costs, a large and well diversified drilling inventory, considerable flexibility with the size of its capital expenditure program, and its expanding liquids production, which is targeted to reach 36% of total production in 2012. The company's expansion into several newer plays, notably the Marcellus and Utica Shale, will likely lead to further growth in scale and diversification, and contribute to increased liquids production. However, PDC's modest track record in these newer plays increases its business risk profile, and debt funding of negative free cash flow could lead to rising leverage on production and reserves. Average daily production in 2012's second quarter was 21 MBOE per day, 81% of which was in the Rocky Mountain region; however, portfolio highgrading is adding to diversification, with growth initiatives focused on the company's horizontal Niobrara, horizontal Marcellus, and Utica Shale properties. This development activity is at a relatively early stage; however, presuming larger scale drives positive economic returns, this growth will be positive for the company's credit profile. PDC's near term focus is on developing the liquids-rich Wattenberg Field in the Rockies to capitalize on the higher margins associated with liquids production. In the second quarter of 2012, PDC liquids production was 33% of its total, up significantly from 18% at year-end 2009. The company's 2012 capital budget has been set at $288 million, 65% of which is allocated to drilling and development, virtually all to the Wattenberg. The SGL-3 Speculative Grade Liquidity rating reflects Moody's view that the company has adequate liquidity through 2013, based largely on the $241.3 million availability it has under its $525 million secured borrowing base revolving credit as of June 30, 2012. The borrowing base was increased on June 29 from $425 million based on PDC's 2011 reserves audit and reserves associated with additional acquired Wattenberg acreage. Revolver covenants include a current ratio of 1.0x or better, and a debt to EBITDAX ratio of no more than 4.0x. At June 30, PDC was fully in compliance, and Moody's expects it to remain so through 2013. There are no debt maturities until 2015 when the revolving credit facility is scheduled to mature. Substantially all of PDC's assets are pledged as security under the credit facility, which will limit the extent to which asset sales could provide a source of additional liquidity if needed. PDC conducts its operations in the Marcellus through its 50% stake the PDC Mountaineer, LLC (PDCM) joint venture, which maintains an $80 million secured borrowing base revolving credit; outstandings at June 30 totaled $52 million. This credit facility is scheduled to mature in 2014 and is non-recourse to PDC. The rating outlook is positive. An upgrade could result should average daily production increase to 35 MBOE per day while maintaining debt to average daily production below $25,000 per BOE, assuming returns and the company's business risk profile do not deteriorate as a result of further expansion and development. Moody's could downgrade the ratings should debt to average daily production increase above $35,000 per BOE for a sustained period, or should capital productivity decline to the extent that PDC's leveraged full-cycle ratio falls below 1.0x. The B3 senior unsecured note rating reflects both the overall probability of default of PDC, to which Moody's assigns a PDR of B2, and a loss given default of LGD5-75%. PDC's senior unsecured notes are subordinate to its $525 million secured borrowing base revolving credit facility's potential priority claim to the company's assets. The size of the potential senior secured claims relative to PDC's outstanding senior unsecured notes results in the notes being rated one notch below the B2 CFR under Moody's Loss Given Default Methodology. The principal methodology used in rating PDC was the Global Independent Exploration and Production Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. PDC is an independent E&P company headquartered in Denver, Colorado. PDC ENERGY: S&P Gives 'B-' Rating on $400MM Sr. Unsecured Notes --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B-' issue-level rating to PDC Energy Inc.'s (PDC's) proposed $400 million senior unsecured notes due 2022. "At the same time, we assigned a '5' recovery rating to this issue, indicating modest (10% to 30%) recovery in the event of a payment default. PDC, formerly Petroleum Development Corp., intends to use the net proceeds from this offering to redeem its 12% senior notes due 2018, to repay other debt, and for general corporate purposes," S&P said. "The ratings on Denver-based PDC reflect our view that natural gas prices will remain weak in the near term. The rating also reflects the company's limited scale with significant concentration in the Rocky Mountain region and our estimate that the company will outspend operating cash flows in 2012. We also incorporated PDC's long reserve life, the increasing percentage of oil and natural gas liquids in its production mix, and adequate liquidity and satisfactory credit metrics for the rating," S&P said. "We characterize PDC's business risk profile as 'vulnerable', given its significant exposure to weak natural gas prices, the company's limited scale, and its high concentration in the Rockies (where natural gas typically trades at a discount to Henry Hub). PDC is a relatively small, independent exploration and production (E&P) company, with 1.015 trillion cubic feet equivalent (Tcfe) of total proved reserves--66% natural gas and 46% proved developed. About 91% of PDC's proven reserves at fiscal year-end 2011 are in the Rockies and about 50% of its reserves are Rockies natural gas," S&P said. Ratings List PDC Energy Inc. Corporate Credit Rating B/Stable/-- Ratings Assigned PDC Energy Inc. $400M sr unsecd notes due 2022 B- Recovery Rating 5 PLAINS EXPLORATION: S&P Rates $5-Bil. Credit Facilities 'BB' ------------------------------------------------------------ Standard & Poor's Ratings Services said its ratings on Plains Exploration & Production Co. will remain on CreditWatch, where it placed them with negative implications on Sept. 10, 2012. "Upon completion of the transaction, we expect to lower the corporate credit rating on the company to 'BB-', assign a negative outlook, and lower the issue ratings on the company's existing unsecured debt to 'B'," S&P said. "At the same time, we assigned our 'BB' senior secured rating and '2' recovery rating to Plains Exploration & Production Co.'s new $5.0 billion senior secured credit facility--consisting of $3 billion secured revolver due 2017, $750 million secured term loan due 2017, and $1.25 billion term loan due 2019. We also assigned a 'B' rating and '6' recovery rating to the company's $2.0 billion unsecured bridge facility. These ratings are not on CreditWatch Negative," S&P said. "The ratings on the $7.0 billion of facilities the company is raising to fund the transaction reflect our assessment of the company's corporate credit rating following the transaction," said credit analyst Lawrence Wilkinson. "We will resolve the CreditWatch upon the closing of the acquisitions. If the transaction is completed upon substantially similar terms as those we currently expect, we will lower the corporate credit rating to 'BB-' and assign a negative outlook," S&P said. PORTER BANCORP: John Davis Named Chief Credit Officer of PBI Bank ----------------------------------------------------------------- John R. Davis was appointed the Chief Credit Officer of PBI Bank following its receipt of approval of the appointment from the Federal Deposit Insurance Corporation. In his new position, Mr. Davis will have responsibility for establishing and executing the credit quality policies and overseeing credit administration for the Porter Bancorp organization. Mr. Davis, age 49, joined PBI Bank as a credit officer in August 2012 after having served as Executive Vice President - Chief Credit Officer of American Founders Bank, Inc., and American Founders Bancorp, Inc., of Lexington, Kentucky. Before joining American Founders in 2005, he served for 17 years in various commercial lending and credit administration positions of increasing authority with National City Bank. Mr. Davis has an MBA degree from Bellarmine University and is a graduate of the Stonier Graduate School of Banking. In connection with his appointment, Mr. Davis entered into an employment agreement with Porter Bancorp and PBI Bank, effective on Sept. 24, 2012. Mr. Davis' employment as CCO is effective Sept. 24, 2012, and will terminate on Sept. 23, 2015, subject to extension. Mr. Davis' initial base salary is $235,000 per year and may be increased from time to time in those amounts as the boards of directors of the Company and the Bank may determine, but may not be decreased without his express written consent. No increase in the base salary is expected to occur during the first two years of the agreement. On the effective date, the Company granted a restricted stock award to Mr. Davis which has a grant date value equal to one-third of his projected total compensation for 2012. For purposes of this award, Mr. Davis' total compensation for 2012 will equal the sum of his base salary earned for the year plus the grant date value of the 2012 restricted stock award. A copy of the Employment Agreement is available for free at: http://is.gd/HYaDEZ 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 June 30, 2012, showed $1.33 billion in total assets, $1.25 billion in total liabilities and $81.50 million in stockholders' equity. PTC ALLIANCE: S&P Gives 'B' Corp. Credit Rating; Outlook Stable --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary 'B' corporate credit rating to Wexford, Penn.-based PTC Alliance Holdings Corp. The outlook is stable. "At the same time, we assigned our preliminary 'B' issue-level rating to the company's proposed $225 million senior secured term loan. The recovery rating on the loan is '4', indicating our expectation that lenders would receive average (30% to 50%) recovery in the event of payment default under our default scenario," S&P said. The company intends to use the proceeds from the offering to pay a $180 million dividend to its owners and for general corporate purposes. "The rating on PTC reflects our view of its business risk profile as 'vulnerable' and financial risk profile as 'aggressive,'" said credit analyst Gayle Bowerman. "Our assessment of PTC's business risk incorporates our view of the company's dependence on a single product line for most of its EBITDA, as well as our view that the company's operations lack size and scope. Our view of PTC's financial risk profile considers the risk that the company may be unable to adjust its operating costs or pass through raw material costs to customers in a timely manner, or that cyclical volume declines could be severe enough to significantly reduce operating performance and stress liquidity." "The stable rating outlook reflects our expectation that credit metrics will remain at a level we would consider to be in line with the rating over the next few quarters, given our view of PTC's vulnerable business risk profile. Specifically, we expect total adjusted debt-to-EBITDA in the 2.5x to 3.5x range through the end of fiscal 2013, based on our assumption that the company's operating performance will improve modestly amid a gradual economic recovery," S&P said. QUINCY MEDICAL: Buyer Liable to Severance Claims ------------------------------------------------ Bankruptcy Judge Melvin S. Hoffman ruled that Quincy Medical Center, a Steward Family Hospital Inc., which purchased substantially all of Quincy Medical Center Inc.'s assets in bankruptcy is liable to Apurv Gupta and Victor Munger, senior executives of the Debtor, for severance pay due them under QMC's Executive Severance Policy. Specifically, the Court said Steward is liable to each of Dr. Gupta and Mr. Munger for severance pay equal to six months' compensation under QMC's executive severance policy: $156,000 for Dr. Gupta and $90,000 for Mr. Munger. In addition, the executives are entitled to three months' salary: $78,000 for Dr. Gupta and $45,000 for Mr. Munger. In a previous ruling, the Court denied the executives' request to collect on their claims from the Debtor. Dr. Gupta, Mr. Munger and QMC have argued that the asset purchase agreement governing the sale of the hospital required Steward to offer employment to individuals who were employed by QMC on an agreed upon date at or near the closing and who were on the list of employees QMC provided to Steward prior to the closing. Dr. Gupta and Mr. Munger were not offered employment. A copy of the Court's Sept. 25, 2012 Memorandum of Decision is available at http://is.gd/2OLSMrfrom Leagle.com. About Quincy Medical Center Quincy Medical Center is a 196-bed, nonprofit hospital in Quincy, Massachusetts. Quincy Medical Center, Inc. together with two affiliates, sought Chapter 11 protection (Bankr. D. Mass. Lead Case No. 11-16394) on July 1, 2011. John T. Morrier, Esq., at Casner & Edwards, LLP, in Boston, serves as counsel to the Debtors. Navigant Capital Advisor LLC and Navigant Consulting Inc. serve as financial advisors. Epiq Bankruptcy Solutions LLC is the claims, noticing, and balloting agent. Quincy disclosed assets of $73 million and liabilities of $79.4 million. Debt includes $56.4 million owing on secured bonds issued through a state health-care finance agency. There is another $2.5 million secured obligation owing to Boston Medical Center Corp. Accrued liabilities are $18.2 million. On July 12, 2011, the U.S. Trustee for the District of Massachusetts appointed the Official Committee of Unsecured Creditors. Counsel to the Creditors' Committee is Jeffrey D. Sternklar, Esq., at Duane Morris LLP, in Boston, Massachusetts. Deloitte Financial Advisory Services LLC is the financial advisor to the Creditors' Committee. Quincy sold its hospital facility to Steward Health Care System LLC, in October 2011 for $52.4 million, not enough for full payment to secured bondholders owed $56.5 million. The bonds were issued through a state health-care finance agency. Nonetheless, $562,500 -- not subject to bondholders' deficiency claims -- was set aside for unsecured creditors with claims estimated to total between $6 million and $7 million. The disclosure statement estimated unsecured creditors would recover about 8.4%. In November 2011, the Court approved the Chapter 11 liquidation plan. The Plan was later declared effective on Dec. 7, 2011. RADIOSHACK CORP: James Gooch to Step Down as CEO ------------------------------------------------ Drew FitzGerald, writing for Dow Jones Newswires, reports that RadioShack Corp. said Chief Executive James F. Gooch will step down after little more than a year on the job, indicating a new direction for the electronics retailer as it grapples with weak sales. "In its discretion, the board decided the timing was right," a company spokesman said, according to Dow Jones. "Moving forward with the decision sooner rather than later will help establish the right leadership to address the company's challenges and capitalize on its opportunities." According the report, Mr. Gooch, who became CEO in May 2011, also will give up his seat on the board. He joined the company in August 2006 as chief financial officer and was promoted after former Chief Executive Julian Day retired. Dow Jones says Mr. Gooch, 45 years old, couldn't immediately be reached for comment. The report relates Chief Financial Officer Dorvin Lively was chosen to step in as acting CEO until the company names a permanent successor. Mr. Lively, a finance veteran for retail and consumer-products companies, joined RadioShack in August 2011 from Ace Hardware Corp. The report says RadioShack shares rose four cents to $2.60 in 4 p.m. New York Stock Exchange trading Sept. 26, following a 16% drop on Tuesday after S&P Dow Jones Indices booted RadioShack from its midcap index, citing the company's small market capitalization. RadioShack has shed 80% of its value over the past year, reflecting its struggle with higher costs amid falling sales of its more profitable consumer electronics. Dow Jones says the executive shift follows the resignation of Chief Merchandise Officer Scott E. Young in June and the departure of Chief Marketing Officer Lee Applbaum in March. Neither position has had a permanent replacement. About Radioshack Fort Worth, Texas-based RadioShack Corp. sells consumer electronics and peripherals, including cellular phones. It operates roughly 4,700 stores in the U.S. and Mexico. It also operates about 1,500 wireless phone kiosks in Target stores. The company also generates sales through a network of 1,100 dealer outlets worldwide. Revenues for the last 12 months' period ending June 30, 2012 were roughly $4.4 billion. Radioshack's balance sheet at June 30, 2012, showed $2.08 billion in total assets, $1.38 billion in total liabilities and $704.6 million in total stockholders' equity. * * * As reported by the Troubled Company Reporter on Aug. 1, 2012, Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured debt ratings on RadioShack to 'B-' from 'B+'. "The downgrade of RadioShack reflects our view that it will be very difficult for the company to improve its gross margin in the second half of the year," said Standard & Poor's credit analyst Jayne Ross, "given the highly promotional nature of year-end holiday retailing in the wireless and consumer electronic categories. It is our belief that all segments of the company's business will remain under margin pressure for 2012 and into 2013." In the July 27, 2012, edition of the TCR, Fitch Ratings has downgraded its long-term Issuer Default Rating (IDR) for RadioShack to 'CCC' from 'B-'. The downgrade reflects the significant decline in RadioShack's profitability, which has become progressively more pronounced over the past four quarters. RANCHO HOUSING: Exclusive Plan Filing Period Extended to Nov. 27 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California has extended the period within which the Rancho Housing Alliance, Inc. has the exclusive right to propose a Chapter 11 plan of reorganization until Nov. 27, 2012, and the period within which the Debtor has the exclusive right to solicit acceptances of that plan until Jan. 27, 2013. The Debtor in its Motion said that its Disclosure statement, as amended, and Plan will have the support of every class of creditors, except American West Bank, the Class 6a and 6b creditor. "Over the past several weeks, the Debtor has been in negotiations with the Bank regarding potential collateral substitutions that could radically alter the treatment of Classes 6a and 6b, but which could also result in the Plan being confirmed consensually," the Debtor stated. After filing its proposed amended Disclosure Statement and Plan, the Debtor and the Bank have been negotiating regarding various alternate collateral packages that would result in making some of the cash deposits available to the Debtor for use in its operations. These negotiations, if successful, will necessitate revisions to the Plan and the Disclosure Statement, in that the treatment of Classes 6a and 6b could be altered significantly. About Rancho Housing Alliance Rancho Housing Alliance, Inc., is a California non-profit public benefit corporation authorized and operating pursuant to Division 2 of Title I of the California Corporations Code. RHA has members but does not issue equity securities of any kind. Each member also serves on the Debtor's board of directors. However, operational control of the Debtor rests with its Executive Director, Mr. Jeffrey Hays. RHA's specific charitable purposes are to benefit and support another California non-profit public benefit corporation known as Desert Alliance for Community Empowerment, Inc. In assisting DACE, RHA, among other things, provides affordable, decent, safe and sanitary housing for low income persons where adequate housing does not exist and assists low-income households to secure education, training and services for self-sufficiency. In meeting these goals, RHA owns and operates a number of properties and programs. RHA filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 11-27519) on May 27, 2011. Judge Scott C. Clarkson presides over the case. Michael B. Reynolds, Esq., at Snell & Wilmer LLP, serves as the Debtor's counsel. The Debtor disclosed $12,882,123 in assets and $22,404,858 in liabilities as of the Chapter 11 filing. The bankruptcy filing was precipitated when the City of Coachella Redevelopment Agency filed a judicial foreclosure action on the Tierra Bonita project and began threatening to do so with respect to the Calle Verde Project. The aggregate debt for both projects is roughly $6 million, with a potential deficiency judgment that could reach $4.9 million. RG STEEL: Asks Court to Preserve Critical Access to Cash -------------------------------------------------------- Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports that RG Steel LLC is begging not to be cut off from its lenders' cash, warning that its ability to pay its remaining employees and cover the costs of its Chapter 11 proceeding are at stake. 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 it's financial advisor. RITZ CAMERA: Boater's World Mark Sold for $140,000 -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Ritz Camera & Image LLC held an auction this week for non-core intellectual property and emerged with a high bid of $140,000. According to the report, the winning bidder was Central Florida Yamaha Inc. from Lake Placid, Florida. The opening bid at auction was $25,000. The auction was for the right to use the name Boater's World and related trademarks and Internet names. The bankruptcy court in Delaware was slated to hold a hearing Sept. 27 to approve the sale. Ritz is liquidating entirely. Unable to find a buyer to acquire the remaining camera stores as a going concern, liquidators were hired to run going-out-of-business sales through the end of October. 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. The Committee tapped Cooley LLP as its lead counsel, Richards, Layton & Finger, P.A. as its Delaware counsel, and PricewaterhouseCoopers LLP as its financial advisor. ROCK POINTE: Court OKs Ken Gates as Committee Attorney ------------------------------------------------------ The Unsecured Creditors Committee of Rock Pointe Holdings Company LLC sought and obtained approval from the U.S. Bankruptcy Court to retain Kenneth W. Gates, as counsel. The attorney will charge the Debtor's estates $230 per hour. Daily charge is limited to $1,840 if traveling to out of area representation. Robert D. Miller Jr., the United States Trustee for Region 18, in June appointed five unsecured creditors to serve on the Committee. About Rock Pointe Holdings Rock Pointe Holdings Company LLC owns the Rock Pointe Corporate Center in Spokane, Washington. The Company filed for Chapter 11 protection (Bankr. E.D. Wash. Case No.11-05811) on Dec. 2, 2011. Brett L. Wittner, Esq., at Kent & Wittner PS, represents the Debtor. The Debtor estimated both assets and debts of between $50 million and $100 million. ROCKLIN ACADEMIES: S&P Affirms 'BB+' Rating on 2 Bond Series ------------------------------------------------------------- Standard & Poor's Ratings Services revised the outlook to negative from stable on California Statewide Communities Development Authority's charter school revenue bonds, series 2011A and taxable series 2011B, issued for The Rocklin Academies (TRA). "At the same time, Standard & Poor's affirmed its 'BB+' rating on the bonds. "The negative one-year outlook reflects our view of the difficult funding environment and school's lower-than-anticipated growth, and the subsequent credit risks to the school's liquidity and budgeting in fiscal 2013," said Standard & Poor's credit analyst Carlotta Mills. The rating reflects S&P's view of: -- The general credit risks associated with charter schools, including that of charter nonrenewal; -- The school's negative operations in fiscal 2010 following a recent trend of positive operations; -- The school's very low cash on hand in fiscal 2011 (fewer than three days) due to receivables from the state outstanding; and -- Underenrollment at the high school. RYERSON HOLDING: S&P Affirms 'B-' Corporate Credit Rating --------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' corporate credit rating on metals service center Ryerson Holding Corp. (Ryerson). The outlook is stable. "At the same time, we assigned our 'CCC+' issue-level rating (one notch lower than the corporate credit rating) to the proposed $600 million senior secured notes due 2017. The recovery rating is '5', indicating our expectation for modest (10% to 30%) recovery in the event of a payment default. At the same time, we assigned a 'CCC' issue-level rating (two notches lower than the corporate credit rating) to the proposed $300 million senior unsecured notes due 2018. The recovery rating is '6', indicating our expectation of a negligible (0% to 10%) recovery in the event of a payment default. The secured notes and unsecured notes will be issued by Ryerson Inc. and Joseph T. Ryerson & Son Inc.," S&P said. "We expect the company to use the proceeds of the proposed notes issuance to repay the company's existing floating-rate senior secured notes due 2014, its 12% senior secured notes due 2015, its senior discount notes due 2015, a portion of the outstanding amount on its senior secured revolving credit facility, and related fees and expenses. We anticipate that we will withdraw our ratings on Ryerson's existing notes upon successful completion of the refinancing," S&P said. "The ratings and stable outlook on Ryerson reflect the combination of what we consider to be the company's 'highly leveraged' financial risk profile and 'vulnerable' business risk profile," said credit analyst Marie Shmaruk. "These assessments take into account the company's high debt leverage and thin interest coverage, slow steel demand growth, low margins relative to some of its peers, and participation in the highly cyclical and volatile steel industry. Still, we expect its near-term liquidity position to remain adequate to meet its obligations despite the likelihood that the company will draw on its revolving credit facility as demand improves and increases inventory to service customers." "The outlook is stable. We expect Ryerson's operating performance to continue to gradually improve into 2013--in line with a moderate economic recovery and increased end-market demand and better margins. However, we expect credit measures to remain in line with the current rating, with pro-forma debt-to-EBITDA of about 8.0x, declining to below 7.0x in 2013, still more in-line with the current rating," S&P said. "A negative rating action could occur if operating performance were to deteriorate from poor execution of management's strategic direction and leverage climbs to and is sustained at levels above 10x or the company's ABL availability declines--specifically, to less than $125 million," S&P said. "We could take a positive rating action if prices and volumes were to continue to increase, resulting in better operating performance and much stronger credit measures--for example, if debt-to-EBITDA were to strengthen to less than 6x and we believe it would remain there. This could occur if a there is a sustainable improvement in margins to well above 6%," S&P said. RYERSON INC: Moody's Rates $600-Mil. Sr. Secured Notes 'Caa2' ------------------------------------------------------------- Moody's Investors Service assigned a Caa2 rating to Ryerson Inc.'s proposed $600 million senior secured notes and a Caa3 rating to the proposed $300 million senior unsecured notes. Moody's also assigned a Caa1 corporate family rating (CFR) and probability of default rating (PDR) and a liquidity rating of SGL-3 to Ryerson Inc. The rating outlook is stable. The proceeds from the proposed note offerings will be used to repay debt including the redemption of Ryerson Inc.'s $103 million senior secured floating rate notes (Caa1) and $369 million 12% senior secured notes (Caa1), Ryerson Holding Corporation's senior discount notes (Caa3) and for general corporate purposes. The rating on Ryerson Inc.'s senior secured floating rate notes and 12% senior secured notes and Ryerson Holding Corporation's senior discount notes as well as the Caa1 corporate family rating and probability of default rating on Ryerson Holding Corporation will be withdrawn when the notes are redeemed. The CFR and PDR will be moved to Ryerson Inc. since there will no longer be any outstanding debt at Ryerson Holding Corporation. The following rating actions were taken: Proposed $600 million senior secured notes, assigned Caa2, LGD4-63%; Proposed $300 million senior unsecured notes, assigned Caa3, LGD6-94%; Corporate family rating, assigned Caa1; Probability of default rating, assigned Caa1; Speculative grade liquidity rating, assigned SGL-3 Ratings Rationale Ryerson Inc.'s Caa1 corporate family rating reflects the company's elevated leverage, acquisitive history, low profit margins versus other rated metal service centers, and the cyclicality and competitiveness of the metals distribution industry. The rating is supported by the company's size and scale, geographic, product and customer diversification, modest capital spending, adequate liquidity, and the countercyclical nature of its working capital investment. Ryerson's performance has been weak in recent years, but has the potential to improve based on the company's strategic efforts to enhance its profitability. This includes a shift towards transactional versus contract customers and a focus on higher margin long and fabricated plate products versus flat rolled steel. However, this transformation is likely to transpire gradually over a longer time horizon. Ryerson's stable outlook presumes the company will carefully balance its leverage and other credit metrics with its growth strategy and maintain adjusted debt-to-EBITDA below 7.0x and (EBITDA-CapEx)/Interest above 1.0x. An upgrade is possible if the company achieves a marked and sustainable improvement in operating margins and a material reduction in debt levels while maintaining adequate liquidity and interest coverage. This would include sustainable operating margins above 5%, a reduction in the company's leverage ratio below 6.0x and an improvement in (EBITDA-CapEx/Interest) above 1.5x. Ryerson's ratings could come under pressure if debt financed acquisitions, shareholder dividends or softening steel market demand results in the company's leverage ratio increasing to above 7.0x or (EBITDA-CapEx)/Interest declining to less than 0.75x. The ratings could also be negatively impacted by an erosion of Ryerson's liquidity. The principal methodology used in rating Ryerson Holding Corporation was the Global Distribution & Supply Chain Services Industry Methodology published in November 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. Ryerson Holding Corporation, through its subsidiary Ryerson Inc., is the second largest metals service center company in North America, with approximately 95 locations in the U.S., Canada and Mexico. The company also has six locations in China and one joint venture location in Brazil. Ryerson provides a full line of carbon, stainless and aluminum products to more than 40,000 customers in a broad range of end markets. The company generated sales of approximately $4.5 billion for the 12-month period ending June 30, 2012. Ryerson is primarily owned by Platinum Equity. SAVERS INC: Moody's Assigns 'Ba3' Rating to $790MM Secured Loans ---------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to the proposed $790 million senior secured bank credit facilities of thrift store retailer Savers, Inc. ("Savers," initially Evergreen AcqCo 1 LP). The credit facilities consist of a $75 million revolver due 2017 and a $715 million term loan due 2019. Concurrently, Moody's affirmed the B2 corporate family and probability of default ratings. The outlook is stable. Proceeds from the proposed term loan combined with modest cash on hand will be used to acquire a regional chain for $35 million and to pay off $27 million of outstanding borrowings under the revolver. The company is already highly leveraged as a result of its July 2012 leveraged buyout by Leonard Green & Partners, L.P. and TPG Capital. Pro forma for the LBO and the acquisition (net of revolver repayment), total balance sheet debt will rise further by about $33 million to $1.01 billion. "However, the acquisition is leverage neutral given the expected EBITDA generation from the acquired chain," stated Moody's analyst Mariko Semetko. Given the company's history of consistent sales and earnings growth and cash generation, Moody's expects credit metrics will improve steadily over time as the company anniversaries the LBO and the acquisition of the regional chain. Furthermore, the proposed credit facilities will likely be priced at a lower interest rate than the existing facilities, resulting in about $5 million of expected annual interest expense savings and higher interest coverage. Moody's also expects Savers to maintain good near-term liquidity given its $75 million revolver, expected cash flow generation, and modest cash balances. The ratings are contingent upon the receipt and review of final documentation. The following rating has been assigned: - Proposed $75 million revolver due 2017 at Ba3 (LGD3, 31%) - Proposed $715 million term loan due 2019 at Ba3 (LGD3, 31%) The following ratings have been affirmed: - Corporate Family Rating of B2 - Probability of Default Rating of B2 Ratings affirmed and to be withdrawn following closing of new senior secured credit facilities: - $75 million senior secured revolver at Ba3 (LGD3, 30%) - $655 million term loan at Ba3 (LGD3, 30%) Ratings Rationale The B2 corporate family rating reflects the company's high financial leverage and modest scale, as well as the high degree of competition in the off-price retail segment. Debt/EBITDA pro forma for the LBO and the acquisition of the regional chain will be well above 7.0x (incorporating Moody's operating lease adjustment). However, given the company's consistent same store sales growth, proven resilience throughout economic cycles, limited seasonality and low fashion risk, Savers is better positioned to manage the high debt load than some of its more volatile retail peers. The rating also benefits from Savers' good liquidity. The Ba3 ratings on the proposed $790 million bank credit facilities consisting of a $715 million term loan and a $75 million revolver reflect their first priority lien on substantially all domestic assets of the company and upstream guarantees by all existing and future indirect wholly owned subsidiaries. The ratings also benefit from the loss absorption provided by the $295 million senior unsecured notes due June 2022 (unrated by Moody's). The stable outlook reflects Moody's expectations for high-single to low-double-digit revenue growth driven by a combination of continued same store sales increases and new store openings. Moody's anticipates that Savers will generate moderate levels of free cash flow and maintain good liquidity. Savers' ratings could be downgraded if the company does not make progress towards reducing debt/EBITDA below 7.0 times or does not maintain EBITA/interest expense above 1.25 times. Further, negative ratings pressure would rise if financial policies become aggressive or if liquidity deteriorates for any reason. An upgrade is unlikely in the near term and would require debt/EBITDA sustained below 5.5 times and EBITA/interest expense above 2.0 times while demonstrating a willingness to maintain a conservative financial policy, including the use of free cash flow for debt reduction. The principal methodology used in rating Evergreen AcqCo 1 LP was the Global Retail Industry Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Bellevue, Washington, Savers operates roughly 290 for-profit thrift stores in the United States, Canada, and Australia under the Savers, Value Village, and Village des Valeurs banners. Revenues for the last 12 months through June 30, 2012 were about $1 billion. Following the July 2012 LBO, Savers is owned by Leonard Green & Partners, L.P. and TPG Capital (approximately 45.5% in aggregate, split evenly between the two) in partnership with Savers' chairman Thomas Ellison (45.5%) and management (9%). SENECA GAMING: Panel Appointment No Impact on Moody's Ratings ------------------------------------------------------------- Moody's Investors Service said that Seneca Gaming Corporation's ("SGC") ratings and outlook (B2, negative) are not affected by the its announcement this week that an arbitration panel of three members has been named to resolve a Class III gaming compact dispute between the Seneca Nation, SGC's owner, and the State of New York. While the naming of the panel marks a material step forward towards the final resolution of this long-standing dispute -- the dispute is a key rating factor with respect to SGC's ratings and outlook -- the appointment of this panel does not ensure a favorable outcome for the Seneca Nation as the potential outcome still remain uncertain. Seneca Gaming Corporation owns and operates Seneca Niagara Falls Casino and Hotel in Niagara Falls, NY, Seneca Allegany Casino and Hotel in Salamanca, NY, and Seneca Buffalo Creek Casino in Erie County, NY. SIERRA NEGRA: Files Schedules of Assets and Liabilities ------------------------------------------------------- Sierra Negra Ranch LLC filed with the U.S. Bankruptcy Court for the District of Nevada schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $25,949,250 B. Personal Property $248,736 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $4,619,277 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $180,759 ----------- ----------- TOTAL $26,197,986 $4,800,037 The Debtor also filed a statement of financial affairs, a copy of which is available at: http://bankrupt.com/misc/SIERRA_NEGRA_sal.pdf About Sierra Negra Las Vegas, Nevada-based Sierra Negra Ranch LLC is a limited liability company organized in November 2004 to purchase an aggregate of approximately 2,757.5 acres of undeveloped land in the Tonopah area of incorporated Maricopa County, west of Phoenix, Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D. Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. The Debtor is "Single Asset Real Estate" as defined in 11 U.S.C. Sec 101(51B) and its asset is located in Maricopa County, Arizona. Gerald M. Gordon, Esq., at Gordon Silver, serves as the Debtor's bankruptcy counsel. SIERRA NEGRA: Taps Gordon Silver as Bankruptcy Counsel ------------------------------------------------------ Sierra Negra Ranch, LLC, seeks authorization from the U.S. Bankruptcy Court for the District of Nevada to employ the law firm of Gordon Silver as bankruptcy counsel, nunc pro tunc to the Petition Date. Gordon Silver will, among other things, prepare and pursue confirmation of a plan of reorganization and approval of a disclosure statement, and prepare on behalf of the Debtor all necessary applications, motions, answers, proposed orders, other pleadings, notices, schedules and other documents, and review all financial and other reports to be filed at these hourly rates: Paraprofessionals $135 to $190 Associates $190 to $360 Shareholders $400 to $725 The Debtor paid Gordon Silver the sum of $8,570 for legal services rendered in connection with its restructuring. Gordon Silver is also currently holding in retainer the sum of $33,430. To the best of the Debtor's knowledge, Gordon Silver does not hold or represent any interest adverse to the Debtor's estate, and is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A hearing on the Debtor's motion will be held on Oct. 17, 2012, at 2:00 p.m. About Sierra Negra Las Vegas, Nevada-based Sierra Negra Ranch LLC is a limited liability company organized in November 2004 to purchase an aggregate of approximately 2,757.5 acres of undeveloped land in the Tonopah area of incorporated Maricopa County, west of Phoenix, Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D. Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. In its schedules, the Debtor disclosed $26,197,986 in total assets and $4,800,037 in total liabilities. The Debtor is "Single Asset Real Estate" as defined in 11 U.S.C. Sec 101(51B) and its asset is located in Maricopa County, Arizona. SOLYNDRA LLC: Given OK to Auction Fremont Plant for at Least $90MM ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Solyndra LLC, the liquidating solar panel maker, was told by the bankruptcy judge that she will approve the holding of an auction for the plant in Fremont, California, where the first bid of $90.3 million will be made by an affiliate of Seagate Technology Plc. According to the report, the date for a hearing to approve the sale wasn't determined at the Sept. 24 hearing because the parties were looking for a time when Seagate personnel would be available. The report relates that creditors are voting on Solyndra's proposed Chapter 11 plan. There will be a confirmation hearing on Oct. 17 where the bankruptcy judge in Delaware will consider approving the plan. About Solyndra LLC Founded in 2005, Solyndra LLC was a U.S. manufacturer of solar photovoltaic solar power systems specifically designed for large commercial and industrial rooftops and for certain shaded agriculture applications. The Company had 968 full time employees and 211 temporary employees. Solyndra has sold more than 500,000 of its panels since 2008 and generated cumulative sales of over $250 million. Fremont, California-based Solyndra and affiliate 360 Degree Solar Holdings Inc. sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12799) on Sept. 6, 2011. Solyndra is at least the third solar company to seek court protection from creditors since August 2011. Judge Mary F. Walrath presides over the Debtors' cases. The Debtors are represented by Pachulski Stang Ziehl & Jones LLP as legal adviser. AlixPartners LLP serves as noticing claims and balloting agent. Imperial Capital LLC serves as the company's investment banker and financial adviser. The Debtors also tapped former Massachusetts Governor William F. Weld, now with the law firm McDermott Will & Emery, to represent the company in government investigations and related litigation. BDO Consulting, a division of BDO USA, LLP, as financial advisor and BDO Capital Advisors, LLC, serves as investment banker for the creditors' panel. The Official Committee of Unsecured Creditors of Solyndra LLC has tapped Blank Rome LLP as counsel and BDO Consulting as financial advisors. In October 2011, the Debtors hired Berkeley Research Group, LLC, and designated R. Todd Neilson as Chief Restructuring Officer. Solyndra owed secured lenders $783.8 million, including $527.8 million to the U.S. government pursuant to a federal loan guarantee, and held assets valued at $859 million as of the Petition date. The U.S. Federal Financing Bank, owned by the U.S. Treasury Department, is the Company's biggest lender. When they filed for Chapter 11, the Debtors pursued a two-pronged strategy to effectuate either a sale of their business to a "turnkey" buyer who may acquire substantially all of Solyndra's assets or, if the Debtors were unable to identify any potential buyers, an orderly liquidation of the assets for the benefit of their creditors. Solyndra did not receive acceptable offers to buy the business as a going concern. Two auctions late last year brought in a total of $8 million. A three-day auction in February generated another $3.8 million. An auction in June generated $1.79 million from the sale of 7,200 lots of equipment. Solyndra filed a liquidating plan at the end of July and scheduled a hearing on Sept. 7 for approval of the explanatory disclosure statement. The Plan is designed to pay 2.5% to 6% to unsecured creditors with claims totaling as much as $120 million. Unsecured creditors with $27 million in claims against the holding company are projected to have a 3% dividend. SOUTH LAKES DAIRY: Sec. 341 Creditors' Meeting Set for Oct. 2 ------------------------------------------------------------- Mark L. Pope, Assistant U.S. Trustee for Region 17, will hold a Meeting of Creditors under 11 U.S.C. Sec. 341(a) in the Chapter 11 case of South Lakes Dairy Farm on Oct. 2, 2012, at 1:00 p.m. at Fresno Meeting Room 1452. The last day to oppose discharge is Dec. 3, 2012. Proofs of claim are due by Jan. 2, 2013. About South Lakes Dairy South Lakes Dairy Farm filed a bare-bones Chapter 11 petition (Bankr. E.D. Calif. Case No. 12-17458) in Fresno, California on Aug. 30, 2012, disclosing $19.5 million in assets and $25.4 million in liabilities in its schedules. The Debtor said it has $1.97 million in accounts receivable charged to Dairy Farmers of America on account of milk proceeds, and that it has cattle worth $12.06 million. The farm owes $12.7 million to Wells Fargo Bank on a secured note. A copy of the schedules is available for free at http://bankrupt.com/misc/caeb12-17458.pdf Bankruptcy Judge W. Richard Lee presides over the case. The Debtor has tapped Klein, DeNatale, Goldner, Cooper, Rosenlieb & Kimball, LLP, as counsel. SOUTH LAKES DAIRY: U.S. Trustee Appoints 5-Member Creditors' Panel ------------------------------------------------------------------ Mark L. Pope, Assistant U.S. Trustee for Region 17, pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed five unsecured creditors to serve on the Official Committee of Unsecured Creditors of Alexander Gallo Holdings LLC. The Creditors Committee members are: 1. Cal-By Products Attn: Lyle W. Ens P.O. Box 9247 Fresno CA 93791-9247 2. Center For Race, Poverty And The Environment Attn: Caroline Farrell 1012 Jefferson Street Delano CA 93215 3. Gillespie AG Service Attn: Dana Gillespie 15301 Road 192 Porterville CA 93257-8967 4. Troost Hay Sales Attn: Richard Owens 400 Carsen Way Shafter CA 93263 5. Western Milling, LLC Attn: Mark La Bounty P.O Box 1029 Goshen CA 93227-1028 About South Lakes Dairy South Lakes Dairy Farm filed a bare-bones Chapter 11 petition (Bankr. E.D. Calif. Case No. 12-17458) in Fresno, California on Aug. 30, 2012, disclosing $19.5 million in assets and $25.4 million in liabilities in its schedules. The Debtor said it has $1.97 million in accounts receivable charged to Dairy Farmers of America on account of milk proceeds, and that it has cattle worth $12.06 million. The farm owes $12.7 million to Wells Fargo Bank on a secured note. A copy of the schedules is available for free at http://bankrupt.com/misc/caeb12-17458.pdf Bankruptcy Judge W. Richard Lee presides over the case. The Debtor has tapped Klein, DeNatale, Goldner, Cooper, Rosenlieb & Kimball, LLP, as counsel. STANADYNE CORP: UTC Executive Named Chief Operating Officer ----------------------------------------------------------- David P. Galuska, age 56, was appointed Chief Operating Officer of Stanadyne Corporation effective Sept. 21, 2012. Mr. Galuska will be responsible for Stanadyne's global operations in the United States, China, India and Italy. Since 2009, Mr. Galuska served as Senior Vice President, Module Centers and Operations for Pratt & Whitney, a division of United Technologies Corporation. Pratt & Whitney is a world leader in the design, manufacture and service of aircraft engines, space propulsion systems and industrial gas turbines. UTC is a diversified company providing high technology products and services to the global aerospace and commercial building industries. Previously, he served as Vice President, Operations for Hamilton Sundstrand from 2005 to 2009, as well as Vice President, Operations from 2004 to 2005 and Vice President, Precision Manufacturing from 2001 to 2004 for Sikorsky Aircraft, both divisions of UTC. Mr. Galuska began his tenure with UTC at Hamilton Standard (now known as Hamilton Sundstrand) where he held positions of increasing responsibility over a span of 22 years. Mr. Galuska has an M.B.A. from Western New England College and a B.A. in Marketing from the University of Connecticut. Mr. Galuska is an at-will employee and does not have an employment agreement with Stanadyne. The written and unwritten arrangements under which Mr. Galuska is compensated include: * a base salary, reviewed each year by the Compensation Committee of the Board of Directors and the Chief Executive Officer; * a monthly allowance for transportation costs; * an annual allowance for financial planning, health and wellness activities; * eligibility for annual cash bonuses under Stanadyne's Employee Incentive Plan based on the achievement of financial performance measures established annually by Stanadyne; * eligibility for Stanadyne paid term life insurance in an amount up to twice his annual salary; * eligibility for Stanadyne paid long term disability insurance coverage; and * a broad-based benefits package offered to all employees, including participation in health and welfare programs for medical, dental, life insurance and accidental death and disability. In connection with Mr. Galuska's appointment as COO, Stanadyne will seek approval from the Compensation Committee of Stanadyne Holdings, Inc., for a grant of stock options. Stanadyne anticipates that any stock options granted to Mr. Galuska will be under the terms of the Stanadyne Holdings, Inc., 2004 Equity Incentive Plan. About Stanadyne Corporation Stanadyne Corporation, headquartered in Windsor, Connecticut, is a designer and manufacturer of highly-engineered precision- manufactured engine components, including fuel injection equipment for diesel engines. Stanadyne sells engine components to original equipment manufacturers and the aftermarket in a variety of applications, including agricultural and construction vehicles and equipment, industrial products, automobiles, light duty trucks and marine equipment. Revenues for LTM ended Sept. 30, 2010, were $240 million. * * * As reported in the Troubled Company Reporter on Jan. 21, 2011, Moody's Investors Service confirmed Stanadyne Holdings, Inc.'s Caa1 Corporate Family Rating and revised the rating outlook to stable. In the March 12, 2012, edition of the TCR, Standard & Poor's Ratings Services affirmed its ratings, including the 'CCC+' corporate credit rating, on Stanadyne. "The outlook revision reflects the risk that Stanadyne may not be able to service debt obligations of its parent, Stanadyne Holdings Inc. as early as August 2012," said Standard & Poor's credit analyst Dan Picciotto. SUSAN BENSON: Court Confirms Funeral Parlor's Amended Plan ---------------------------------------------------------- Bankruptcy Judge Frank L. Kurtz confirmed the Second Amended Plan of Reorganization of Susan L. Benson, d/b/a Benson Family Funeral Service, Inc., filed July 13, 2012. The Plan incorporates a Stipulation Resolving Objections to Plan by Sterling Savings Bank. The Plan also modifies the treatment of the claim of Tri County Economic Development District. The claim will be paid $1,000 per month as and for adequate protection until paid in full. The first payment will be made within 30 days of the sale and closing of Funeral Home and Chapel. Tri Co will retain its lien upon and in Cemetery and Crematorium. A copy of the Court's Sept. 25, 2012 decision is available at http://is.gd/fg60Yifrom Leagle.com. Susan L. Benson, d/b/a Benson Family Funeral Service, Inc., filed for Chapter 11 bankruptcy (Bankr. E.D. Wash. Case No. 11-03679) on July 28, 2011. TEXAS RANGERS: Raine Advisors Granted $2.5 Million in Fees ---------------------------------------------------------- Raine Advisors, LLC, which assisted HSG Sports Group LLC in 2009 in finding a buyer for Texas Rangers Baseball Partners before the club was placed in bankruptcy protection, may collect on $2.5 million in fees after the Bankruptcy Court in Dallas tossed out objections filed by Alan Jacobs, the Plan Administrator under the baseball club's confirmed plan of reorganization; and JP Morgan Chase Bank, N.A., the administrative and collateral agent to the first lien lenders. Raine, along with Merrill Lynch, Pierce, Fenner & Smith Inc. and Perella Weinberg Partners LP, served as a financial advisor to HSG, the Rangers' ultimate parent, during the period when HSG first sought an investor, then a buyer, for the baseball club. In return for financial services provided by Raine, Raine was to receive in addition to a monthly payment a transaction fee which would have totaled $5,000,000 had the original sale of the Rangers to Rangers Baseball Express, LLC, agreed to by the Debtor following an auction overseen by Major League Baseball at the end of 2009, been consummated. The Original Agreement contained a tail provision, which stipulated that Raine was entitled to the Original Transaction Fee if a Rangers Transaction was consummated within 12 months after termination of the Original Agreement by the Hicks Parent Entities. HSG and Debtor, however, were unable to close the sale of the Rangers to Express prepetition, and the Debtor thereafter sought bankruptcy court in May 2010. Shortly before the Petition Date, Raine entered into a new engagement letter with the Debtor that designated Raine as financial advisor to the Debtor in connection with a sale of the Rangers. Similar to the Original Agreement, Raine was to be paid a transaction fee in the event a Rangers Transaction was consummated, although the fee in the Replacement Agreement was reduced to $2,500,000. The Replacement Agreement also contained its own tail provision by which Raine was entitled to receive the Replacement Transaction Fee if a Rangers Transaction was consummated within 12 months after termination of the Replacement Agreement by the Debtor. Simultaneously with the Replacement Agreement, HSG and Raine executed an agreement terminating the Original Agreement, purporting to replace it with the Replacement Agreement. On May 23, 2010, Debtor and Express entered into the Asset Purchase Agreement, pursuant to which the Debtor again agreed to sell the Rangers to Express. The APA replaced the agreement by which Express had previously intended to purchase the Rangers. The transactions contemplated by the APA, following postpetition amendments to the APA that ultimately increased the return to Debtor's (and HSG's) principal creditors, closed on the day Debtor's plan of reorganization became effective, Aug. 12, 2010. Raine, relying on the Replacement Tail Provision, sought a Replacement Transaction Fee of $2.5 million. The Plan Administrator and the First Lien Agent objected, alleging that the Replacement Agreement was a fraudulent incurrence of an obligation under 11 U.S.C. Section 548(a)(1). They pointed to the simultaneous termination of the Original Agreement and execution of the Replacement Agreement on the eve of bankruptcy, when, for all intents and purposes, Raine had completed its work and would do no further substantive work under either agreement. Bankruptcy Judge D. Michael Lynn, however, determined that the Debtor was liable under the Original Agreement, and that the Replacement Agreement simply took the place of the Original (with a change in the amount of the transaction fee that benefited the Debtor). Considering the totality of the circumstances, the Court found no actual intent of the Debtor to defraud creditors under 11 U.S.C. Section 548(a)(1)(A). The Plan Administrator and the First Lien Agent also objected to the proof of claim filed by Merrill. Merrill, however, reached agreement with the Objectors on the eve of the hearing. A copy of the Court's Sept. 25 Memorandum Opinion is available at http://is.gd/0lnxDMfrom Leagle.com. About Texas Rangers Texas Rangers Baseball Partners owned and operated the Texas Rangers Major League Baseball Club, a professional baseball club in the Dallas/Fort Worth Metroplex. TRBP is a Texas general partnership, in which subsidiaries of HSG Sports Group LLC own a 100% stake. Controlled by Thomas O. Hicks, HSG also indirectly wholly-owns Dallas Stars, L.P., which owns and operates the Dallas Stars National Hockey League franchise. The Texas Rangers have had five owners since the club moved to Arlington in 1972. Mr. Hicks became the fifth owner in the history of the Texas Rangers on June 16, 1998. Texas Rangers Baseball Partners filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 10-43400) on May 24, 2010. The partnership filed simultaneously with the bankruptcy petition a Chapter 11 plan that contemplated the sale of the club to an entity formed by a group that includes the President of the Texas Rangers, Nolan Ryan, and Chuck Greenberg, a sports lawyer and minor league club owner. In its petition, Texas Rangers Baseball Partners said it had both assets and debt of less than $500 million. Martin A. Sosland, Esq., at Weil, Gotshal & Manges LLP, served as bankruptcy counsel to the Debtor. Forshey & Prostok LLP acted as conflicts counsel. Parella Weinberg Partners LP served as financial advisor. Major League Baseball was represented by Sandy Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka PC. Lenders to the Texas Rangers sought to force the baseball team's equity owners -- Rangers Equity Holdings, L.P. and Rangers Equity Holdings GP, LLC -- into bankruptcy court protection (Bankr. N.D. Tex. Case No. 10-43624 and 10-43625). The lenders, a group that includes investment funds Monarch Alternative Capital and Kingsland Capital Management, filed an involuntary bankruptcy petition on May 28, 2010 against the two companies. The two companies were not included in the May 24 Chapter 11 filing of TRBP. U.S. Bankruptcy Judge Stacey G. C. Jernigan on Aug. 5, 2010 confirmed the Debtor's fourth amended version of the Prepackaged Plan of Reorganization. The judge's confirmation order cleared the way for a group of Hall of Fame pitcher Nolan Ryan, and Pittsburgh sports attorney and minor-league team owner Charles Greenberg to purchase the Texas Rangers. The Ryan group paid $385 million in cash and assumed $208 million in liabilities. The Ryan group outbid Dallas Mavericks owner Mark Cuban at an auction. TRI-VALLEY: Opus Equity Panel Opposes New Loan ---------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the official equity holders' committee for TVC Opus I Drilling Program LP, an affiliate of bankrupt Tri-Valley Corp., is urging the bankruptcy judge to hold off for two weeks in approving the financing for the Chapter 11 reorganization. According to the report, the Opus equity committee, appointed Sept. 15, contends the proposed loan will improperly convert $7.2 million of pre-bankruptcy debt into a post-bankruptcy loan, when Opus was never liable on the old debt. The Opus owners also don't like having liability for $3.85 million in fresh cash because "only a portion" might be used for Opus. The Opus owners point out that Tri-Valley is the manager of Opus under a partnership agreement. As manager, Tri-Valley isn't an equity partner in Opus, the owners say. The report relates that if the bankruptcy judge isn't inclined to postpone the financing hearing for two weeks beyond the hearing scheduled for Sept. 27, the equity committee wants the judge to sever Opus from the loan and collateral package. Opus is "by far" the largest unsecured creditor of Tri-Valley, resulting from millions of dollars in expenses improperly charged to Opus over the years, the equity committee said. An oil and natural gas production and development company, Tri-Valley is scheduled to sell the assets at auctions on Oct. 17 and Dec. 5, under procedures approved on Sept. 5 by the bankruptcy court. About Tri-Valley Tri-Valley Corporation (OTQCB: TVLY) -- http://www.tri-valleycorp.com/-- explores for and produces oil and natural gas in California and has two exploration-stage gold properties in Alaska. Tri-Valley and three affiliates filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case No. 12-12291) on Aug. 7 with funding from lenders that require a prompt sale of the business. K&L Gates LLP serves as bankruptcy counsel. Attorneys at Landis Rath & Cobb LLP serve as Delaware and conflicts counsel. The Debtors have tapped Epiq Bankruptcy Solutions, LLC, as claims agent. The Debtor disclosed assets of $17.6 million and liabilities totaling $14.1 million. Former Chairman G. Thomas Gamble, who is financing the bankruptcy case, is owed $7.2 million on several secured notes. There is an unsecured note for $528,000 and $9.4 million in unsecured debt owing to suppliers. The Debtor is contemplating a quick sale of the assets. Bids are due by Oct. 10 or Oct 17, depending on which package of assets a bidder hopes to buy. A hearing to approve the sales is set for Dec. 6. TRITON CONTAINER: S&P Says 'BB+' CCR Reflects Stable Earnings ------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BBB' issue-level rating to Triton Container International Ltd.'s (Triton) proposed $100 million senior notes series 2012-A due 2022 and 2024. "The recovery rating on this issue is '1', indicating our expectation that lenders would receive a very high (90% to 100%) recovery in the event of a payment default," S&P said. The 'BB+' corporate credit rating on San Francisco-based Triton reflects the company's significant position within the marine cargo container leasing industry and the relatively stable earnings and cash flow generated from a substantial proportion of its long-term leases. The ratings also incorporate the cyclicality and capital intensity of the marine cargo container leasing industry. Ratings List Triton Container International Ltd. Corporate credit rating BB+/Stable/-- New Ratings Triton Container International Ltd. $50 mil. senior secured due 2022 BBB Recovery rating 1 $50 mil. senior secured due 2024 BBB Recovery rating 1 TRIZETTO GROUP: Moody's Cuts CFR to 'B2'; Rates Term Loan 'Caa1' ---------------------------------------------------------------- Moody's Investors Service downgraded TriZetto Group, Inc.'s corporate family rating to B2 from B1 and affirmed the probability of default rating at B2. Concurrently, Moody's assigned a Caa1 rating to the proposed $150 million second lien term loan and affirmed the B1 ratings of the first lien credit facilities. The rating outlook is stable. The downgrade of the corporate family rating reflects deterioration in TriZetto's credit metrics that has resulted from aggressive growth strategy. The latter includes pre-funding $100 million of acquisitions with proceeds from the proposed $150 million second lien term loan. The remainder of the proceeds are expected to be applied toward reducing revolver outstandings that have spiked due to acquisition activity as well. TriZetto's adjusted debt-to EBITDA is projected to increase to above 6.0 times and adjusted free cash flow-to-debt to decline to the low- to-mid single digit range by the end of 2012. Moody's does not foresee the company's credit metrics improving significantly over the next 12 to 18 months such as to warrant the maintenance of a B1 corporate family rating. The following rating actions were taken (LGD point estimates are subject to change and all ratings are subject to review of final documentation): $150 million second lien term loan, due 2019, assigned Caa1 (LGD5, 89%); Corporate family rating downgraded to B2 from B1; Probability of default rating affirmed at B2; $85 million first lien revolving credit facility, due 2016, affirmed at B1; LGD rate changed to LGD3, 39% from LGD3, 33%; $650 million first lien term loan, due 2018, affirmed at B1; LGD rate changed to LGD3, 39% from LGD3, 33%. Rating Rationale The B2 corporate family rating incorporates TriZetto's aggressive acquisition strategy that is projected to keep adjusted debt leverage at around 6.0-6.5 times over the next 12 to 18 months. In addition, the B2 corporate family rating considers expected margin pressure partially from the highly competitive healthcare technology market and TriZetto's switch to full stack solution business model. However, the B2 rating positively reflects TriZetto's recurring revenue base of approximately 63% of June 30, 2012 revenues. The visibility of the company's revenues is expected to be enhanced by the continued migration to the full stack solutions model from the perpetual model. Further, TriZetto is expected to benefit from the healthcare industry's need to battle increasing costs via movement toward increasing technology utilization. Additionally, future risk sharing between payors and providers is expected to benefit TriZetto as the healthcare industry participants need to become more efficient in order to remain competitive. The stable outlook reflects end market demand for healthcare information technology, revenue visibility due to the high and increasing level of recurring revenues, and the company's good liquidity profile. The rating could be downgraded if TriZetto's adjusted debt-to- EBITDA was projected to be sustained above 6.5 times and adjusted (EBITDA less capital expenditures)-to-interest expense to be sustained below 1.0 times. In addition, if TriZetto's liquidity profile deteriorates, the rating could be downgraded. There may also be rating pressure if TriZetto were to face increasing contract losses from competitive pressures or were unable to integrate acquisitions. Any shareholder friendly activities would put negative pressure on the rating as well. The rating could be upgraded if TriZetto successfully grows both the payer and provider businesses, while de-leveraging the company to below 5.0 times on a sustained basis. Further rating could be upgraded if TriZetto were to maintain free cash flow-to-debt above 10%. The principal methodology used in this rating was 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. Headquartered in Greenwood Village, Colorado, TriZetto is a provider of information technology solutions to the healthcare industry. TriZetto's shareholders include Apax Partners, BlueCross BlueShield of Tennessee, Inc. and The Regence Group. For the trailing twelve months ended June 30, 2012 the company's revenues were $617 million. UNIGENE LABORATORIES: Gets $4MM Loan, Waivers from Victory Park --------------------------------------------------------------- Unigene Laboratories, Inc., has entered into a Forbearance Agreement and First Amendment to Amended and Restated Financing Agreement with affiliates of Victory Park Capital Advisors, LLC, dated Sept. 21, 2012, whereby Victory Park Capital has loaned the Company $4 million and agreed to forbear from exercising certain rights due to designated events of default through Sept. 21, 2013, subject to the terms and conditions of that agreement. A copy of the Forbearance Agreement is available for free at: http://is.gd/KfONEE Ashleigh Palmer, Unigene's chief executive officer, stated, "While the recent unexpected European Medicines Agency recommendation involving calcitonin and other events have seriously challenged the Company's turnaround, today's announcement clearly demonstrates that Victory Park Capital has not lost sight of Unigene's potential. In particular, we believe that the Company's proprietary Peptelligence technology, know-how and expertise represents the most clinically advanced and validated oral peptide drug delivery platform in the industry today." "Following today's announcement, Unigene now has sufficient cash runway to maintain operations beyond the original VPC note maturity date and capitalize on potential value-building milestones realizable during the extended forbearance period. We continue to work on 14 feasibility studies that have the potential to convert into one or more revenue-generating licensing agreements. We now have the funds available to complete the toxicology program for UGP281, our lead proprietary anorexigenic peptide for the treatment of obesity, and subsequently prepare and file an Investigational New Drug Application with the FDA next year. This would allow the Company to begin human clinical testing in the event it is able to get additional funding. Additionally, Unigene is working diligently with Nordic Bioscience to advance UGP302 into human clinical testing as a treatment for Type 2 diabetes, and continues the active pursuit of partnering and funding opportunities for the advanced clinical development and commercialization of its Phase 2 oral PTH analog program." Under the terms of the Forbearance Agreement and First Amendment to Amended and Restated Financing Agreement, Unigene has issued to an affiliate of Victory Park Capital Advisors, LLC, a one-year senior secured convertible note in the aggregate principal amount of $4 million, which bears interest at a rate per annum equal to the greater of the prime rate plus 5% or 15%. Of the $4 million, $500,000 has been deposited with Victory Park Capital to cover certain of Victory Park Capital's fees and expenses, including those fees related to the transaction. The remaining $3.5 million will be used by Unigene to finance operations. The agreement allows for the $4 million of new debt to convert into shares of the Company's common stock based on a conversion rate of $0.05 per share, while the existing debt that had a conversion rate of $0.70 per share has been re-issued and now converts into shares of the Company's common stock based on a conversion rate of $0.15 per share. As the Company lacks sufficient shares of common stock to deliver all of the conversion shares, the Company is required to obtain stockholder approval to increase the number of authorized shares to allow for the conversion of the debt in full. The agreement amended certain default provisions under the Amended and Restated Financing Agreement to include new events of default, including a default in the event that a required quarterly reconciliation shows a negative variance of 10% or more of actual cash revenue minus actual cash expenses for an applicable quarter versus the applicable quarterly cash flow forecast required to be delivered by the Company, failure to maintain a cash balance in a specified account of at least $250,000, and a breach of any agreement or covenant contained in the agreement. Pursuant to the terms of the Forbearance Agreement and First Amendment to Amended and Restated Financing Agreement, the Company has approved and authorized key employee retention grants and executive team restructuring grants, as well as employee and director retention grants. The Company has also entered into various ancillary agreements in relation to the transaction. Further details related to the Forbearance Agreement and First Amendment to Amended and Restated Financing Agreement and ancillary agreements is available at http://is.gd/MxrwkY About Unigene Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/ -- is a biopharmaceutical company focusing on the oral and nasal delivery of large-market peptide drugs. Unigene reported a net loss of $17.92 million in 2011, a net loss of $27.86 million in 2010, and a net loss of $13.38 million in 2009. The Company's balance sheet at June 30, 2012, showed $11.69 million in total assets, $77.56 million in total liabilities and a $65.87 million total stockholders' deficit. Grant Thornton LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern following the 2011 financial results. The independent auditors noted that the Company has incurred a net loss of $17,900,000 during the year ended Dec. 31, 2011, and, as of that date, has an accumulated deficit of approximately $189,000,000 and the Company's total liabilities exceeded total assets by $55,138,000. Bankruptcy Warning Under the Company's amended and restated March 2010 financing agreement with Victory Park Management, LLC, so long as the Company's outstanding note balance is at least $5,000,000, the Company must maintain a minimum cash balance equal to at least $2,500,000 and its cash flow must be at least $2,000,000 in any fiscal quarter or $7,000,000 in any three consecutive quarters. "Without additional financing, we will not be able to maintain a minimum cash balance of $2,500,000, or maintain an adequate cash flow, in order to avoid default in periods subsequent to September 30, 2012," the Company said in its quarterly report for the period ended June 30, 2012. "As a result, we will be in default under the financing agreement, which would result in the full amount of our debt owed to Victory Park becoming immediately due and payable. Even if we are able to raise cash and maintain a minimum cash balance of at least $2,500,000 through the March 2013 maturity date, there is no assurance that the notes will be converted into common stock, in which case, we may not have sufficient cash from operations or from new financings to repay the Victory Park debt when it comes due. There can be no assurance that new financings will be available on acceptable terms, if at all. In the event that we default, Victory Park could retain control of the Company and will have the ability to force us into involuntary bankruptcy and liquidate our assets." UNIVAR INC: Moody's Affirms 'B2' CFR/PDR; Outlook Stable -------------------------------------------------------- Moody's Investors Service said Univar Inc.'s B2 Corporate Family Rating (CFR) and the B2 rating on its term loan B are unaffected by the proposed $550 million increase in the term loan. The proceeds from the term loan add-on will be used to repay outstanding borrowings under the ABL revolver, and for general corporate purposes, including potential future acquisitions. The outlook is stable. The following summarizes the ratings activity: Univar, Inc. Ratings affirmed Corporate Family Rating - B2 Probability of Default Rating - B2 Senior Secured Term Loan B due 2017 -- B2 (LGD3, 47%) from B2 (LGD3, 48%) Outlook is Stable. Ratings Rationale The add-on to the term loan will increase leverage by about 0.5x to 6.8x (as of June 30, 2012, pro forma for the proposed financing, assuming the revolver balance is repaid, and including Moody's standard analytical adjustments, which adds approximately $667 million to debt to account for unfunded pension liabilities and operating leases). Pro forma for the new debt financing, Univar would have had adjusted debt of $4.3 billion as of June 30, 2012. Moody's expects that the company will be able to reduce leverage over the next 12-18 months by growing EBITDA organically and through acquisitions or by partially repaying existing high cost debt, should it not find sufficient attractive acquisition opportunities on which to spend the add-on term loan proceeds. The B2 CFR reflects Univar's elevated leverage (6.8x as of June 30, 2012, pro forma for the financing transaction) and the potential for acquisitions. To date, the company has increased its debt by approximately $1.5 billion including Moody's analytical adjustments from year-end 2007 levels. The elevated debt level positions Univar weakly in the B2 rating category, however Univar has successfully de-levered in the past after levering events such as dividends and acquisitions through growing its profits. Univar's B2 CFR also reflects its modest operating margins (albeit typical for a chemicals distributor) that allow for a minimal cushion in its highly leveraged situation, an underperforming European business with regional concentration, a product mix in the US weighted towards commodity chemicals, its history of inconsistent free cash flow generation as cash flow has been invested in working capital to support sales growth (although it did produce $141 million of free cash flow as reported for the twelve month period ending June 30, 2012), and working capital seasonality associated with the company's agricultural chemicals distribution business in Canada that will require the company to borrow additional funds on a seasonal basis. The ratings favorably recognize Univar's leading market share in North America and large market share in Europe, economies of scale, long-lived customer and supplier relationships with minimal concentration, favorable industry trends in outsourcing to distributors that has resulted in the distribution business growing faster than overall chemicals sales, the stable nature of the firm's historical EBITDA generation, and relatively modest maintenance capital expenditure requirements. The rating outlook is stable. There is little upward pressure on the rating given Univar's high leverage weakly positions it in the B2 rating category and the potential for event risk (e.g., debt- financed acquisitions). If the company maintained a leverage (Debt / EBITDA) ratio of less than 4.5x on a sustained basis, the ratings could be upgraded. The ratings could be downgraded if the company is unable to continue to grow EBITDA, maintain adequate liquidity or if leverage (Debt / EBITDA) exceeded 7x on a sustained basis. The principal methodology used in rating Univar was the Global Chemical Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Univar Inc. is one of the largest distributors of industrial chemicals and providers of related services, operating over 200 distribution centers to service a diverse set of end markets in the US, Canada and Europe. The company was taken private in October 2007, and is currently majority owned by funds managed by CVC Capital Partners and Clayton, Dubilier & Rice, LLC. The company had revenues of $9.8 billion for the twelve months ended June 30, 2012. UROLOGIX INC: Had $4.7-Mil. Net Loss in Fiscal Year Ended June 30 ----------------------------------------------------------------- Urologix, Inc., filed on Sept. 24, 2012, its annual report on Form 10-K for the fiscal year ended June 30, 2012. KPMG LLP, in Minneapolis, Minnesota, expressed substantial doubt about Urologix, Inc.'s ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and negative operating cash flows and has significant current obligations related to the Sept. 6, 2011 acquisition of the Prostiva(R) Radio Frequency (RF) Therapy System from Medtronic, Inc. The Company reported a net loss of $4.7 million on $17.0 million of sales for fiscal 2012, compared with a net loss of $3.7 million on $12.8 million of sales for fiscal 2011. The Company's balance sheet at June 30, 2012, showed $12.7 million in total assets, $12.1 million in total liabilities, and stockholders' equity of $626,000. A copy of the Form 10-K is available at http://is.gd/twFIjl Minneapolis, Minnesota-based Urologix, Inc., develops, manufactures, and markets non-surgical, office-based therapies for the treatment of the symptoms and obstruction resulting from non- cancerous prostate enlargement also known as benign prostatic hyperplasia (BPH). VHGI HOLDINGS: Michael Fasci Appointed Chief Financial Officer -------------------------------------------------------------- VHGI Holdings, Inc.'s Board of Directors unanimously approved the appointment of Mr. Michael E. Fasci as Chief Financial Officer on Sept. 21, 2012. Since 1987, Mr. Fasci has owned and operated Process Engineering Services, Inc., and since 2006, he has served as CFO of RedFin Network, Inc. In the last five years, Mr. Fasci has also worked as an independent consultant for a number of public and private companies, and in 1997 he qualified for, and he currently maintains, Enrolled Agent status with the Internal Revenue Service. Upon his appointment Mr. Fasci stated, "I'm excited about the challenges that lie ahead during these exciting as well as critical times in the Company's growth. Being an investor and a note holder myself in the company I can relate to the concerns of investors regarding the lack of communication from the Company during the last 6 months or so. In addition to immediately getting the Company's SEC financial filings back to a timely status, we plan on contacting each of our valued note holders to discuss the status and plan of repayment. Our goal is to make the Company much more transparent to investors going forward so they can keep abreast of our progress. I can be contacted directly by email at mike@lilygroup.com with specific questions." "There have been many changes within the company in recent months which I believe have been very positive for the Company. My decision to accept the position of CFO was made after careful evaluation of the Company, its personnel, and specifically Mr. Rick Risinger the Company's recently appointed CEO. While Rick may be new to the CEO position at VHGI Holdings, he is no stranger to The Landree Mine here in Sullivan. Rick has been working non- stop for years at the Lily Group to execute his plan to get the coal out of the ground and I look forward to helping him get that job done." "Everyone is aware of the difficulty the Company has had in the past in closing on the larger expected financing needed to keep the mine open and producing. The people that were engaged to deliver did not execute. While we are not out of the woods yet, the Company is working with lenders who have expressed a desire to be a part of this worthwhile venture. I hope our creditors will continue to work with us as we work our way to a much stronger financial position." "As a result of the many recent developments and changes within the Company, as well as some short-term bridge financing, I am pleased to report that effective today, the mine is open and is producing coal to fulfill our Indianapolis Power and Light contract. While success is never guaranteed, I believe that with the assets the Company has in both its people and the infrastructure at the mine, and with the help of our lenders and creditors, we can bring this project to fruition and make the mine the success that everyone originally envisioned." About VHGI Holdings Fort Worth, Tex.-based VHGI Holdings, Inc., is a holding company with revenue streams from the following business segments: (a) precious metals (b) oil and gas (c) coal and (d) medical technology. The Company reported a net loss of $5.43 million on $499,600 of revenues for 2011, compared with a net loss of $1.67 million on $482,300 of revenues for 2010. The Company's balance sheet at March 31, 2012, showed $49.06 million in total assets, $48.54 million in total liabilities and $524,106 in total stockholders' equity. In its auditors' report on the Company's consolidated financial statements for the year ended Dec. 31, 2011, Pritchett, Siler & Hardy, P.C., in Salt Lake City, Utah, expressed substantial doubt about VHGI Holdings' ability to continue as a going concern. The independent auditors noted that the Company has incurred substantial losses and has a working capital deficit. VHGI HOLDINGS: Issues $2.5MM Notes to CEO, Largest Stockholder -------------------------------------------------------------- VHGI Holdings, Inc., issued two promissory notes, each in the principal amount of $1,275,000. The Notes were issued to (i) Paul R. Risinger, the Company's Chief Executive Officer and a member of the Company's Board of Directors, and (ii) the James W. Stuckert Revocable Trust, the Company's largest stockholder. Each of the Notes carries an interest rate of 10% per annum, and all principal and accrued but unpaid interest under the Notes is due and payable on March 15, 2013. On Sept. 24, 2012, the Company entered into an agreement with Mr. Risinger, who was formerly the sole stockholder of Lily Group Inc., prior to the purchase of all of the issued and outstanding common stock of Lily by VHGI Coal, Inc., a wholly-owned subsidiary of the Company, pursuant to a stock purchase agreement dated Dec. 29, 2011, as amended. Simultaneously with the closing of the Lily SPA, Coal issued 700,000 shares of Series A Preferred Stock to Lily Group Holdings Company, an entity owned by Mr. Risinger. Pursuant to Section 1.1 of the Lily SPA, the Series A Shares were deemed to have a value of $7,000,000. Pursuant to the Exchange Agreement, the Company and Coal will exchange the Series A Shares for 50,000,000 shares of Common Stock of the Company and issue a promissory note that converts the accrued, but unpaid, interest and dividends on the Series A Shares into amounts owed under the Interest Note. The Exchange Shares and Interest Note will be issued upon the filing and effectiveness of an amendment to the Company's Certificate of Incorporation increasing the authorized Common Stock of the Company to 250,000,000 shares. About VHGI Holdings Fort Worth, Tex.-based VHGI Holdings, Inc., is a holding company with revenue streams from the following business segments: (a) precious metals (b) oil and gas (c) coal and (d) medical technology. The Company reported a net loss of $5.43 million on $499,600 of revenues for 2011, compared with a net loss of $1.67 million on $482,300 of revenues for 2010. The Company's balance sheet at March 31, 2012, showed $49.06 million in total assets, $48.54 million in total liabilities and $524,106 in total stockholders' equity. In its auditors' report on the Company's consolidated financial statements for the year ended Dec. 31, 2011, Pritchett, Siler & Hardy, P.C., in Salt Lake City, Utah, expressed substantial doubt about VHGI Holdings' ability to continue as a going concern. The independent auditors noted that the Company has incurred substantial losses and has a working capital deficit. VIKING SYSTEMS: Three Directors Resign from Board ------------------------------------------------- Each of John "Jed" Kennedy, William C. Bopp and Joseph A. De Perio resigned from the Board of Directors of Viking Systems, Inc., and from all Board Committees on which those directors served, effective as of Sept. 24, 2012. Each resigning director resigned pursuant to the provisions of the Merger Agreement, and no director resigned from the Board because of any disagreements with the Company on any matter relating to the Company's operations, policies, or practices. On Sept. 21, 2012, CONMED Corporation successfully completed the tender offer by its wholly-owned subsidiary, Arrow Merger Corporation, for all of the outstanding shares of common stock of Viking Systems, Inc., at a price of $0.27 per share, net to the seller in cash. Hooks K. Johnston, Amy S. Paul and William Tumber of the Company's Board are expected to continue as directors. In addition, effective as of Sept. 24, 2012, the Board appointed the following individuals as members of the Board: Daniel S. Jonas, Robert D. Shallish, Jr., Luke A. Pomilio and Terence M. Berge. Those persons were designated for appointment as directors of the Company by Purchaser pursuant to the Merger Agreement. Viking Systems filed a Form 15 with the U.S. Securities and Exchange Commission notifying of its suspension of its duty under Section 15(d) to file reports required by Section 13(a) of the Securities Exchange Act of 1934 with respect to its common stock, par value $0.001 per share. There was only one holder of the common shares as of Sept. 26, 2012. About Viking Systems Based in Westborough, Massachusetts, Viking Systems, Inc. (OTCBB: VKNG.OB) -- http://www.vikingsystems.com/-- is a developer, manufacturer and marketer of visualization solutions for complex minimally invasive surgery. The Company partners with medical device companies and healthcare facilities to provide surgeons with proprietary visualization systems enabling minimally invasive surgical procedures, which reduce patient trauma and recovery time. Viking Systems reported a net loss applicable to common shareholders of $2.92 million in 2011, compared with a net loss applicable to common shareholders of $2.43 million in 2010. The Company's balance sheet at June 30, 2012, showed $4.71 million in total assets, $3.10 million in total liabilities and $1.61 million in total stockholders' equity. VITAMIN SHOPPE: S&P Raises CCR to 'BB' on Sustained Improvement --------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on North Bergen, N.J.-based Vitamin Shoppe Industries Inc. to 'BB' from 'BB-'. The outlook is stable. The rating on Vitamin Shoppe reflects S&P's assessment that the company's financial risk profile is "significant" and the business risk profile is "fair." "The financial risk profile reflects Vitamin Shoppe's moderate financial policies, no funded debt, and its good cash flow generation. We view the business risk profile as fair, reflecting Vitamin Shoppe's position as the No.2 player in the highly competitive and fragmented retail vitamin industry, the company's deep product offerings compared to its competitors, our expectation of growth greater than the industry average, and the risks associated with its store expansion plans," S&P said. "Credit measures have strengthened over the past year because of EBITDA growth and repayment of all funded debt," said Standard & Poor's credit analyst Jayne Ross. "As a result, leverage improved to 2.6x for the 12 months ended June 30, 2012, from 2.8x a year ago, and interest coverage strengthened to 4.9x from 3.8x year over year. We expect total debt (which is only capitalized operating leases) to EBITDA to remain in the mid- to high-2x range in fiscal 2012, as continued growth in lease commitments will likely partially offset EBITDA growth." "Although credit metrics may be indicative of a higher financial risk score, the absolute size of its cash flow is a limiting factor," added Ms. Ross. "Our outlook on Vitamin Shoppe is stable. We expect the company to modestly improve current credit metrics and margins due to sales leverage and growth in profitability, despite expectations for about 48 new stores in fiscal 2012. We expect adjusted leverage to remain in the mid-2x area, adjusted funds from operations to total debt in the mid-30% area, and EBITDA to interest in the 5x area," S&P said. "We would consider a downgrade if credit metrics deteriorate because of debt-funded shareholder-friendly initiatives, leading to adjusted debt leverage approaching the 3.5x area. Also, we estimate leverage could increase if operating performance declines due to adverse regulatory measures, negative publicity, or competitive pressures such that EBITDA declines by 30%. This could occur, for example, if revenue growth slows to the low- single digits, gross margins contract by 100 bps or more, or some combination of the two," S&P said. "We could consider an upgrade if credit ratios demonstrate further improvement because of consistently strong same-store sales and EBITDA growth that outpaces increases in lease commitments. If positive operating performance enhances credit metrics such that leverage improves to below 2x and the company sustains this metric for several quarters, we could consider an upgrade. For this to occur, sales growth would have to be in the mid-to-high teens, and margins would have to expand by 200 bps or more or some combination of the two," S&P said. VITRO SAB: Claims Bondholders Revealed Restructuring Secrets ------------------------------------------------------------ Eric Hornbeck at Bankruptcy Law360 reports that a Vitro SAB de CV attorney told a New York state appeals court Wednesday that some of its bondholders, including Aurelius Capital Management LP and Elliott Management Corp., should be held responsible for divulging confidential information on the eve of the bankrupt glassmaker's restructuring. Vitro, which ran into trouble after it defaulted on $1.2 billion in debt, has accused bondholders of trying to torpedo Vitro's then-proposed restructuring plan and exchange offer with an October 2010 press release that allegedly disclosed Vitro's confidential information, according to Bankruptcy Law360. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. But an appellate court in Mexico reinstated the reorganization in April 2011. Following the reinstatement, Vitro SAB on April 14, 2011, re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). The Vitro parent received sufficient acceptances of its reorganization by using the US$1.9 billion in debt owing to subsidiaries to vote down opposition by bondholders. The holders of US$1.2 billion in defaulted bonds opposed the Mexican reorganization plan because shareholders could retain ownership while bondholders aren't being paid in full. Vitro announced in March 2012 that it has implemented the reorganization plan approved by a judge in Monterrey, Mexico. In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. Blackstone Advisory Partners L.P. serves as financial advisor to the Committee. The U.S. Vitro companies sold their assets to American Glass Enterprises LLC, an affiliate of Sun Capital Partners Inc., for US$55 million. U.S. subsidiaries of Vitro SAB are having their cases converted to liquidations in Chapter 7, court records in January 2012 show. In December, the U.S. Trustee in Dallas filed a motion to convert the subsidiaries' cases to liquidations in Chapter 7. The Justice Department's bankruptcy watchdog said US$5.1 million in bills were run up in bankruptcy and hadn't been paid. On June 13, 2012, U.S. Bankruptcy Judge Harlin "Cooter" Hale in Dallas entered a ruling that precluded Vitro from enforcing its Mexican reorganization plan in the U.S. The judge ruled that the Mexican reorganization was "manifestly contrary" to U.S. public policy because it bars the bondholders from holding Vitro operating subsidiaries liable to pay on their guarantees of the bonds. The Mexican plan reduced the debt of subsidiaries on $1.2 billion in defaulted bonds even though they weren't in bankruptcy in any country. WALL STREET SYSTEMS: Moody's Rates New Secured 2nd Lien Debt Caa1 ----------------------------------------------------------------- Moody's Investors Service rated Wall Street Systems Holdings, Inc.'s ("WSS") new debt -- secured first lien at B1 and secured second lien at Caa1. The Corporate Family (CFR) and Probability of Default Ratings (PDR) are B2, and the rating outlook is stable. WSS plans to use the proceeds to repay the existing debt and to fund up to a $186 million equity distribution to WSS's owner, Ion Investment Group (a TA Associates company). Following repayment of the existing credit facilities, the ratings of these two credit facilities will be withdrawn. Ratings Rationale The B2 CFR reflects Moody's expectation that WSS will delever quickly from free cash flow bringing debt to EBITDA (Moody's standard adjustments) to below 6x by the end of the year. Moody's expects leverage will remain in the mid to high 5x level, however, which is high given WSS's relatively small scale as a niche provider of software and services for corporate treasury management, foreign exchange trade processing, and Central Bank reserve management. Moody's believes that revenue growth will be modest and that there will be few opportunities for further cost reductions. Moreover, Moody's believes that some of the cost reductions achieved to date may prove unsustainable, and that WSS may need to add costs related to software development in order to boost revenue growth in time. Thus, Moody's believes that the rapid deleveraging that has occurred since June 2011 is unlikely to be repeated. "Given the limited opportunity for further cost reductions and our expectation that WSS will periodically increase financial leverage to fund equity distributions, we expect that debt to EBITDA (Moody's standard adjustments) will vary between 5.5x and 6x over time", said Terry Dennehy, Senior Analyst at Moody's Investors Service. WSS has a solid position in its niche marker, and a fairly predictable revenue base driven by a subscription-based model and minimal client attrition (e.g., 95%+ revenue retention rate). This is expected to produce stable funds from operations (FFO) though somewhat variable cash from operations (CFO) due to working capital movements. The stable outlook reflects Moody's expectation that WSS will maintain its market position and to be able to generate low single-digit annual revenue growth, as WSS further penetrates the foreign exchange trading and central bank markets. Moody's also expects EBITDA margins (Moody's standard adjustments) to settle in the low 40s percent, as WSS benefits from the cost efficiencies achieved since the acquisition in June 2011. As a result, Moody's expects lower debt to EBITDA (Moody's standard adjustments) mostly from modest debt reduction while maintaining an EBITDA about equal to the run rate of the last several quarters. The ratings could be downgraded if WSS Moody's expects net customer attrition or steadily declining EBITDA margins (Moody's standard adjustments), both of which could imply a weakening competitive position. Moreover, the rating could also be downgraded if WSS were to pursue an even more aggressive financial policy than already demonstrated such that Moody's expects that debt to EBITDA (Moody's standard adjustments) will remain above 6x. The ratings could be upgraded if WSS were to increase market share such that revenues and operating income are on-course to grow organically in the upper single digits, resulting in increasing EBITDA and free cash flow (FCF). Moody's would further expect that WSS would demonstrate a more conservative financial policy by using this increased FCF to reduce debt by at least 10% per year, such that the ratio of debt to EBITDA (Moody's standard adjustments) is on-course to remain below 4.5x on a sustained basis. WSS, based in New York, New York, is a provider of treasury management, central banking reserve management, and foreign exchange processing software and services. Rating assigned: Senior Secured First Lien Credit Facilities: B1 (LGD3, 33%); revolving credit due 2017 and first lien term loan due 2019 Senior Secured Second Lien Term Loan: Caa1 (LGD5, 86%); second lien term loan due 2020 The following ratings were affirmed: Corp Family Rating - B2 Probability of Default Rating - B2 Outlook is stable. The principal methodology used in rating WSS was the Global Software Methodology dated May 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published in June 2009. WALL STREET SYSTEMS: S&P Affirms 'B' Corp. Credit Rating -------------------------------------------------------- Standard & Poor's Ratings Services revised the rating outlook on New York City-based Wall Street Systems Holdings Inc. to stable from positive. The outlook revision reflects a more leveraged financial profile pro forma for the transaction. "We also affirmed our 'B' corporate credit rating on the company," S&P said. "At the same time, we assigned a 'B' issue-level rating to the company's proposed $335 million first-lien term loan due 2019 and $30 million revolving credit facility due 2017. The '3' recovery rating indicates our expectation of meaningful (50% to 70%) recovery in the event of payment default," S&P said. "In addition, we assigned a 'B-' issue-level rating to the company's proposed $140 million second-lien term loan due 2020. The '5' recovery rating indicates our expectation of modest (10% to 30%) recovery in the event of payment default," S&P said. "The new facilities will be issued by WSS Delaware Inc., a wholly owned subsidiary of Wall Street Systems Holdings Inc. The corporate credit rating is assigned to Wall Street Systems Holdings Inc. based on our expectation that all existing debt at Wall Street Systems Holdings Inc. will be repaid by the proposed transaction. Therefore, for analytical purposes, we treat of WSS Delaware Inc. as a fully consolidated entity," S&P said. The ratings reflect Wall Street Systems' "weak" business risk profile resulting from its narrow market focus and its revenue exposure to the financial sector and Europe, as well as its "highly leveraged" financial profile, with pro forma leverage in the low-7x area. "Nevertheless, we expect the company's solid base of recurring revenue and good profitability to allow it to reduce leverage to below 6x in 2013," said Standard & Poor's credit analyst Christian Frank, "as revenue recognition from existing contract cycles' past-purchase accounting deferred revenue write-downs." "The stable outlook incorporates our view that the company's solid recurring revenue base and good free cash flow support operating stability. Although unlikely over the next 12 months, if the company can maintain its recent profitability gains while reducing leverage below 5x, we could raise the rating by one notch," S&P said. "Conversely, if sales fall as the result of poor macroeconomic conditions, if the company experiences margin compression, or if it pursues debt-financed acquisitions or shareholder returns, precluding it from reducing leverage from pro forma levels, we could lower the ratings," S&P said. * Moody's Says Number of Lower-Rated Cos. Unchanged Since May ------------------------------------------------------------- The number of companies on the B3 Negative and Lower Corporate Ratings List remains virtually unchanged since May, Moody's Investors Service says in its latest update on the list, "Stable Size of Ratings List a Good Sign for US Default Rate." This suggests that credit conditions for US high-yield companies remain stable despite ongoing concerns about the outlook for the US economy, the euro area debt crisis and economic slowdown in China. "The list has remained remarkably stable, indicating that the credit quality of high-yield issuers is steady and that a spike in corporate defaults is unlikely in the next year," says Senior Vice President and author of the report David Keisman. In addition, he says, all of Moody's other proprietary indicators point to a low default rate, including Moody's Liquidity-Stress Index and Covenant Stress Index, as does the number of ratings on review for downgrade. "Our Liquidity-Stress Index remains at historical lows, indicating that companies have adequate liquidity to manage their cash needs over the coming 12 months, and further that they are managing their liquidity proactively to weather potential threats," Keisman says. A similar low reading on Moody's Covenant Stress Index suggests that few companies are at risk of breaching their covenants. Upgrades and downgrades of high-yield companies have leaned toward downgrades in the past year, though the absolute number of downgrades has been modest, particularly compared with levels seen during the financial crisis. And while ratings on review are also slightly skewed toward reviews for downgrade, again the absolute number is relatively low. "All these indicators support our forecast for a US speculative- grade default rate of 3.2% a year from now, down from 3.5% in August and below the historic average of 4.6%, which dates back to 1992," Keisman says. The average tenure on Moody's B3 Negative and Lower Corporate Ratings List is just under two years. Although firms continue to be added to the list through rating downgrades or removed from it due to upgrades, defaults or rating withdrawals, an average tenure of 21 months indicates that many companies on the list have avoided default but have not yet generated sufficient gains to be taken off it through an upgrade above B3 negative. * North-Am Telco High-Yield Bonds Offer Above Average Protection ---------------------------------------------------------------- North American high yield telecom bonds offer stronger covenant protection than other high-yield non-financial company bonds, due to strong debt-incurrence provisions and protection against lien subordination, says Moody's Investors Service in a new special comment, "North American Telecom Bonds Offer Above-Average Protections." The special comment reviews 21 telecom bond deals from Moody's High Yield Covenant Database and compares them to 398 North American non-financial company bonds, excluding those bonds with high yield-lite structures. "The prevalence of a leverage test for debt incurrence and generally low debt carve-outs within high yield telecom structures result in more investor protection than the broader universe of high yield bonds," said Mark Stodden, a Moody's Assistant Vice President -- Analyst. The greater investor protections offered by telecom bonds primarily reflect the strong debt-incurrence protections found in these bonds, which are likely to stem from the industry's high capital intensity, significant dividend payouts and recent debt- financed consolidation that pushes investors to demand protection against higher leverage, says Moody's. A debt incurrence covenant regulates the ability of a company to incur additional leverage after it issues a bond, and is generally not customized to the financial metrics of the company at the time of issuance. However, bonds within Moody's telecom sample overwhelmingly included customized debt incurrence tests which are more restrictive than standardized incurrence tests common outside of the sector. But structural subordination is a weak spot, says the rating agency. Moody's found that protections against structural subordination across the telecom sample was weaker than the average for non-financial companies. The weakness within the telecom sector reflects the impact of unrestrictive structures for several debt issuances by holding companies that have no operating company guarantees. Some of the strongest Covenant Quality Scores within the telecom sample were from debt issued by Consolidated Communications Inc. (B1 stable), Zayo Group, LLC (B2 stable) and EarthLink Inc. (B1 stable), says Moody's. Moody's Covenant Database is to be launched later this year, and contains the key contents of Moody's Covenant Quality Snapshots, which provide pre-sale and post-sale analysis of the strengths and weaknesses of covenant packages, and it adds information such as book runners, private equity sponsors, credit ratings, loss given default and the use of proceeds -- about 150 data points in all. * Judge Edith Jones Stepping Down as Fifth Circuit Chief Judge -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Chief Judge Edith H. Jones will step down as chief judge of the U.S. Court of Appeals in New Orleans effective Oct. 1. Judge Jones's early retirement as chief judge is a result of "various family problems," she told U.S. Supreme Court Chief Justice John G. Roberts Jr. in a letter obtained by Bloomberg News. According to the report, Judge Jones, an expert on bankruptcy law before her appointment as a judge, was the author of many bankruptcy opinions by the Fifth Circuit in New Orleans. Judge Jones, who will continue as a judge on the appeals court, said that she will be replaced as chief judge by Circuit Judge Carl E. Stewart, a 1994 appointment by President Bill Clinton. The circuit court in New Orleans hears appeals from Texas, Louisiana and Mississippi. * Hunton & Williams Gets Turnaround Management Award ---------------------------------------------------- The Turnaround Management Association, an international nonprofit organization dedicated to corporate renewal and turnaround management, has awarded Peter Partee and Mike Wilson, partners in Hunton & Williams LLP's Bankruptcy, Restructuring & Creditors' Rights practice group, the "Small Company Transaction of the Year" honor for successfully handling the reorganization of Raser Technologies, Inc. and 19 of its subsidiaries under Chapter 11 of the Bankruptcy Code. The award will be presented at the TMA's 24th Annual Convention, held in Boston, Mass. Before its remarkable turnaround in 2011, Raser operated two business segments: one focused on producing geothermal electricity and one devoted to developing technology for alternative-fuel vehicles. The economic recession, limited access to capital, and operational issues related to equipment at the company's Thermo One plant placed severe financial pressures on Raser in July 2010, leaving in doubt the company's ability to survive as a going concern. When drastic cost-cutting measures failed to fully address the company's financial issues, Raser turned to Hunton & Williams to advise it on a potential restructuring. The team from Hunton & Williams pursued multiple avenues in early 2011 to keep the company intact. Following negotiations among numerous creditor constituencies, Raser was able to execute a Plan Support Agreement that provided a basis for a complete restructuring of the company's balance sheet through a Chapter 11 plan of reorganization. In September 2011, Raser emerged from bankruptcy after only 126 days with a rationalized balance sheet and having drastically reduced its debt load from $112 million to approximately $6 million. Moreover, the company now has the ability and financial backing to implement its business plan and develop numerous other promising geothermal projects. For more details on Raser's amazing turnaround, visit http://is.gd/okZtri Hunton & Williams handles major bankruptcy, restructuring and creditors' rights representations for a wide range of clients in federal and state courts across the United States, including the traditional bankruptcy fora of the Southern District of New York and the District of Delaware. About Hunton & Williams LLP Hunton & Williams LLP -- http://www.hunton.com-- provides legal services to corporations, financial institutions, governments and individuals, as well as to a broad array of other entities. Since its establishment more than a century ago, Hunton & Williams has grown to more than 800 lawyers serving clients in 100 countries from 19 offices around the world. While its practice has a strong industry focus on energy, financial services and life sciences, the depth and breadth of its experience extends to more than 100 separate practice areas, including bankruptcy and creditors' rights, commercial litigation, corporate transactions and securities law, intellectual property, international and government relations, regulatory law, products liability, and privacy and data security. * BOOK REVIEW: Performance Evaluation of Hedge Funds ---------------------------------------------------- Edited by Greg N. Gregoriou, Fabrice Rouah, and Komlan Sedzro Publisher: Beard Books Hardcover: 203 pages Listprice: $59.95 Review by Henry Berry Hedge funds can be traced back to 1949 when Alfred Winslow Jones formed the first one to "hedge" his investments in the stock market by betting that some stocks would go up and others down. However, it has only been within the past decade that hedge funds have exploded in growth. The rise of global markets and the uncertainties that have arisen from the valuation of different currencies have given a boost to hedge funds. In 1998, there were approximately 3,500 hedge funds, managing capital of about $150 billion. By mid-2006, 9,000 hedge funds were managing $1.2 trillion in assets. Despite their growing prominence in the investment community, hedge funds are only vaguely understood by most people. Performance Evaluation of Hedge Funds addresses this shortcoming. The book describes the structure, workings, purpose, and goals of hedge funds. While hedge funds are loosely defined as "funds with no rules," the editors define these funds more usefully as "privately pooled investments, usually structured as a partnership between the fund managers and the investors." The authors then expand upon this definition by explaining what sorts of investments hedge funds are, the work of the managers, and the reasons investors join a hedge fund and what they are looking for in doing so. For example, hedge funds are characterized as an "important avenue for investors opting to diversify their traditional portfolios and better control risk" -- an apt characterization considering their tremendous growth over the last decade. The qualifications to join a hedge fund generally include a net worth in excess of $1 million; thus, funds are for high net-worth individuals and institutional investors such as foundations, life insurance companies, endowments, and investment banks. However, there are many individuals with net worths below $1 million that take part in hedge funds by pooling funds in financial entities that are then eligible for a hedge fund. This book discusses why hedge funds have become "notorious as speculating vehicles," in part because of highly publicized incidents, both pro and con. For example, George Soros made $1 billion in 1992 by betting against the British pound. Conversely, the hedge fund Long-Term Capital Management (LTCP) imploded in 1998, with losses totalling $4.6 billion. Nonetheless, these are the exceptions rather than the rule, and the editors offer statistics, studies, and other research showing that the "volatility of hedge funds is closer to that of bonds than mutual funds or equities." After clarifying what hedge funds are and are not, the book explains how to analyze hedge fund performance and select a successful hedge fund. It is here that the book has its greatest utility, and the text is supplemented with graphs, tables, and formulas. The analysis makes one thing clear: for some investors, hedge funds are an investment worth considering. Most have a demonstrable record of investment performance and the risk is low, contrary to common perception. Investors who have the necessary capital to invest in a hedge fund or readers who aspire to join that select club will want to absorb the research, information, analyses, commentary, and guidance of this unique book. Greg N. Gregoriou teaches at U. S. and Canadian universities and does research for large corporations. Fabrice Rouah also teaches at the university level and does financial research. Komlan Sedzro is a professor of finance at the University of Quebec and an advisor to the Montreal Derivatives Exchange. ********* 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, Carmel Paderog, Meriam Fernandez, 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 ***