/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/130125.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, January 25, 2013, Vol. 17, No. 24 Headlines 1555 WABASH: Court Confirms Plan of Liquidation 501 GRANT: Court Enters Order for Relief in Involuntary Case A123 SYSTEMS: Wanxiang, Navitas Sale Expected to Close by Feb. 1 ABDIANA A: Combined Plan, Disclosure Statement Hearing on Jan. 28 ABDIANA A: Can Use Arvest Cash Through March 2013 ABSOLUTE LIFE: Incurs $4.7 Million Net Loss in Nov. 30 Quarter AGRIPARTNERS LIMITED: Employs Philip Landau as Counsel AGRIPARTNERS LIMITED: Taps Miller and Hollander as Local Counsel ALLEN FAMILY: Clifford Zucker Designated as Liquidating Trustee ALLIED IRISH: Mortgage Bank Raises EUR500MM From Bond Issue AMERICAN AIRLINES: Wins Court Nod to Pay Off $1.32-Bil. in Loans AMERICAN AIRLINES: Bankr. Judge Allows Pilot's Appeal to Proceed AMERICAN AIRLINES: Gets OK on Purchase Deals with Boeing, et al. AMERICAN AIRLINES: Inks Capacity Purchase Agreement with Republic AMERICAN AIRLINES: Groom Law Discloses New Hourly Rates AMERICAN MEDIA: Avenue Appointee Leaves Board AMERICAN NATURAL: Shareholders Approve 2012 Stock Option Plan AMPAL-AMERICAN: Epiq Approved as Administrative Agent ANLOC LLC: Services by Unlicensed Persons Cost Claims APPLIED DNA: Opted to Repurchase Warrants for $50,000 ARCAPITA BANK: Plan Filing Exclusivity Expires Jan. 28 ASARCO LLC: Sterlite Sued Over Fees from Failed $2.6-Bil. Deal ATARI INC: Says Most Debt Owing to Bankrupt French Parent ATP OIL: To Sell Deep-Water Wells at March 26 Auction BLUEGREEN CORP: Shareholders to Vote on BFC Merger Agreement BON-TON STORES: Unit to Redeem $65-Mil. Senior Notes on Feb. 22 BOOMERANG SYSTEMS: Stockholders Approve 2012 Stock Incentive Plan BROWN PUBLISHING: Trust Suit Againt Failed Buyer Goes to Trial CAMTECH PRECISION: Asks for Final Decree Closing Case CASCADE BANCORP: COO Retires; Board Member Won't Seek Re-Election CASTLEVIEW LLC: Court Dismisses Chapter 11 Case CENTRAL EUROPEAN: Names Russian Alcohol Unit's R. Lee as New CFO CEREPLAST INC: Inks Forbearance Agreement with Sr. Noteholders CHARLIE N MCGLAMRY: Feb. 12 Plan Confirmation Hearing to Proceed CHEF SOLUTIONS: Feb. 5 Hearing on Closing of Chapter 11 Case CLUB AT SHENANDOAH: Wants Access to Cash Collateral Until Feb. 28 CLUB AT SHENANDOAH: Hiring SulmeyerKupetz as Counsel COLLEGE OF NEW ROCHELLE: Moody's Cuts Rating on Bonds to 'Ba1' COMMUNITY FINANCIAL: Has 19.6-Mil. Shares Resale Prospectus CONDOR DEVELOPMENT: Relief of Stay Hearing Continued Until Feb. 8 CORD BLOOD: John M. Fife, St. George Have 9.9% Equity Stake CSD LLC: Wayne Newton Wants to Float Plan for Bankrupt Developer DEWEY & LEBOEUF: Taps Adler Law as Collection Attorneys DEWEY & LEBOEUF: Taps Yoon & Kim as New York Collection Counsel DEWEY & LEBOEUF: Kasowitz Defends $1.2-Mil. Fees Request DIGITAL ANGEL: Disputes Allflex's Claim for Defective Chips DISH NETWORK: Fitch Affirms 'BB-' Issuer Default Rating DUNLAP OIL: Shareholders to Contribute $150,000 to Fund Plan DRINKS AMERICAS: Incurs $9 Million Net Loss in Oct. 31 Quarter EASTBRIDGE INVESTMENT: Change of State of Incorporation Okayed EASTMAN KODAK: Updated Projections Posted with SEC EASTMAN KODAK: Nixon Peabody Advising on U.S. Labor Matters EASTMAN KODAK: Commences Offer to Subscribe Exchange Notes EDISON MISSION: Schedules and Statements Due Feb. 14 EFD LTD: To Seek Case Dismissal at Feb. 4 Hearing ENERGY FUTURE: Expects $2.2 Billion Net Loss in 2012 EPICEPT CORP: Sabby Healthcare Discloses 9.9% Equity Stake FIRST PLACE: Keefe Bruyette Approved as Investment Banker FREESEAS INC: Issues 1.7 Million Common Shares to Hanover FRESNO, CA: Moody's Cuts Ratings on 2006A Convention Center Bonds FUEL DOCTOR: Court Dismisses "McGinnis" Suit in L.A. FUELSTREAM INC: Peak One to Resell 1.1 Million Common Shares GATEWAY CASINOS: Failed Casino Bid No Impact on Moody's B2 CFR GLYECO INC: Further Amends Report on ARI Acquisition GLYECO INC: Full Circle Owner Joins Glyeco Board of Directors GRANITE DELLS: Debtor, Equity Holders Balk at AED Plan Outline HAWKER BEECHCRAFT: Wants to Hire ICF SH&E as Appraisers HEALTHWAREHOUSE.COM INC: In Talks with Lenders to Avert Sale HERCULES OFFSHORE: Files Fleet Status Report as of Jan. 22 HOSTESS BRANDS: Metropoulos Plans to Bid for Cakes Biz with Apollo HOSTESS BRANDS: Committee Wants Lower Breakup Fee for Flowers HOSTESS BRANDS: Retiree Committee Taps Pedersen & Houpt as Counsel HOWREY LLP: Ex-Workers Win Class Certification in WARN Act Case ICEWEB INC: Offering 55 Million Shares Under 2012 Equity Plan INSPIRATION BIOPHARMA: Baxter Agrees to Acquire OBI-1 Rights INSPIRATION BIOPHARMA: Sale to Baxter Has $50MM Upfront Payment INSPIRATION BIOPHARMA: Baxter Sees Value in OBI-1 Assets JACOBS FINANCIAL: Incurs $632,000 Net Loss in Nov. 30 Quarter KINGSBURY CORP: Has Deal With TD Bank, Can Use Cash LCI HOLDING: Wins Final OK to Access Cash Collateral, DIP Loan LCI HOLDING: Committee Taps FTI Consulting as Financial Advisor LCI HOLDING: Files Schedules of Assets and Liabilities LDK SOLAR: Has $31 Million Securities Purchase Pact with Fulai LEHMAN BROTHERS: Investors Win Class Cert. vs. Ernst & Young, UBS LIGHTSQUARED INC: Wants Until May 31 to Propose Chapter 11 Plan LONG ISLAND NATIONAL: GA Keen Conducts Bankruptcy Sale Process LOTHIAN OIL: Fraud Committee, Grossman Lose 5th Cir. Appeal LOUISIANA RIVERBOAT: Lenders Consent to Cash Use Until March 31 LOUISIANA RIVERBOAT: Jan. 28 Hearing on Exclusivity Extension LOUISIANA RIVERBOAT: Confirmation Hearing Continued Until Feb. 6 LYMAN HOLDINGS: Plan Confirmation Hearing Set for Feb. 28 MAKENA GREAT: Cash Collateral Hearing Continued Until Jan. 31 MARKETING WORLDWIDE: Black Arch Discloses 7.9% Equity Stake MARKETING WORLDWIDE: St. George Discloses 9.9% Equity Stake MEDICURE INC: Standard Aero Executive Named to Board of Directors MERIDIAN SUNRISE: Shopping Center Files to Stop Lenders MERVYN'S LLC: Navroth Claim No. 7535 Dismissed as Late Filed MF GLOBAL: Trustee Settles Disputes With ConocoPhillips MF GLOBAL: CFTC Commissioner Overseeing Probe Steps Down MOTORS LIQUIDATION: Files Copy of GUC Trust Report with SEC MUNICIPAL CORRECTIONS: Employs Schwartzer as Local Counsel MUNICIPAL CORRECTIONS: Wins OK for Stone & Baxter as Lead Counsel MUSCLEPHARM CORP: Inter-Mountain No Longer Owns Common Shares NATURAL PORK: Reaches Deal for Use of Cash Collateral NEW ENGLAND COMPOUNDING: Creditors May Seize Owners' Assets NEW YORK WESTCHESTER: Court OKs Montefiore's Bid to Buy Assets NORTEL NETWORKS: Mediation Continues Without End Date NEXT 1 INTERACTIVE: Incurs $2 Million Net Loss in Nov. 30 Qtr. NORTEL NETWORKS: Gets OK to Move Ahead on Deal with Retirees NORTEL NETWORKS: Reaches Settlement with U.S. Disabled Employees OCEAN BREEZE: Chapter 11 Case Dismissed with Prejudice OMEGA NAVIGATION: Has Access to Cash Collateral Until March 25 OLDE PRAIRIE: 2nd Stab at Ch. 11 Fails; CenterPoint to Foreclose OSAGE EXPLORATION: Norman Dowling to Serve as Part-Time CFO PEDEVCO CORP: Amends Current Report to Correct Disclosure Error PENNFIELD CORP: Wants More Time for Plan After Buyer Defaults PENNFIELD CORP: Can Hire Rettew Assoc. as Environmental Consultant PENSON WORLDWIDE: Seeks Approval to Hire Advisors PENSON WORLDWIDE: Moody's Withdraws 'Ca1' Rating After Bankruptcy PEREGRINE FINANCIAL: Wasendorf Set for Sentencing Jan. 31 PEREGRINE FINANCIAL: Fraud Loss Tops $215 Million, Says U.S. PINNACLE AIRLINES: Relocates Headquarters to Minnesota QBEX ELECTRONICS: Has Access to Cash Collateral Until Jan. 29 QBEX ELECTRONICS: Can Employ Francisco Fernandez as Accountant QBEX ELECTRONICS: Committee Retaining Genovese Joblove as Counsel QUANTUM FUEL: Empery Asset Discloses 6.2% Equity Stake RANCHO CALIFORNIA: Creditors Meeting Continued; Plan Due March RESIDENTIAL CAPITAL: Wins OK to Sell $130-Mil. FHA Insured Loans RESIDENTIAL CAPITAL: 25 Highest Paid Employees Won't Get Bonus RESIDENTIAL CAPITAL: Feb. 28 Hearing on Payments to PwC RLD INC: Court Enters Final Decree Closing Reorganization Case SEARS HOLDINGS: Kmart Presents Challenge SINO-FOREST CORP: Plan Implementation Date Expected for Jan. 29 SOUTHERN AIR: Taps Byron Advisors as Independent Contractor SPIRIT REALTY: To Merge with Cole Credit Property Trust STEREOTAXIS INC: Offering 790,000 Shares Under Incentive Plan SUPERMEDIA INC: Director David Hawthorne Dies at 62 TCI COURTYARD: Can Access Trust Cash Collateral Until Feb. 28 TELETOUCH COMMUNICATIONS: Had $424,000 Net Loss in Nov. 30 Qtr. TEN SAINTS: Combined Hearing on Plan to Begin Feb. 4 TENET HEALTHCARE: Fitch Assigns 'BB' Rating to Sr. Secured Notes THERAPEUTIC SOLUTIONS: James Boyd Discloses 11.7% Equity Stake THERAPEUTIC SOLUTIONS: Timothy Dixon Discloses 26.7% Equity Stake THERAPEUTIC SOLUTIONS: 223.9MM Shares Released for Cancellation THQ INC: Video Game Rivals Offer $72-Mil. to Beat Clearlake THQ INC: Assets Split; Sale to Multiple Buyers Approved THQ INC: Crytek Acquires Rights to Homefront IP Studio TORCH ENERGY: Receives NYSE Delisting Notice on Delayed Filing TRANS-LUX CORP: Gabelli Funds Lowers Equity Stake to 46.7% TRUCEPT INC: Adds N. Tipton to Board of Directors VELO HOLDINGS: Scores Approval for Chapter 11 Plan VENTANA 20/20: Nearhood Tapped to Dispute Ariz. Tax Assessment VITESSE SEMICONDUCTOR: Columbia Pacific Holds 8.3% Equity Stake W.R. GRACE: Adjusts Asbestos-Related Liability to $2.06 Billion WEEKLEY FINANCE: Moody's Assigns 'B1' CFR; Outlook Stable WENATCHEE, WA: Moody's Hikes Tax Gen. Obligation Rating to 'Ba1' WISP RESORT: Sells Kendall Camp Circle Property for $485,000 WJO INC: Has Access to Cash Collateral Until Jan. 31 XZERES CORP: Incurs $1.5 Million Net Loss in Nov. 30 Quarter Z TRIM HOLDINGS: Enters Into Joint Development Pact with Newpark * Fitch Says Belt-Tightening Continues for U.S. Consumer * Outlook for Banks Brighter but Still Tough, Fitch Says * Moody's Says US Corp. Family Defaults Remain Steady in Q4 2012 * Firms Keep Stockpiles of "Foreign" Cash in U.S. * Securities and Exchange Commission Reins in Ratings Firm * Consumer, Corporate Defaults Predicted to Continue Falling * Starwood to Buy LNR Properties for $1.05 Billion * SEC Names V. Martinez as Office of Market Intelligence Head * BOOK REVIEW: Performance Evaluation of Hedge Funds ********* 1555 WABASH: Court Confirms Plan of Liquidation ----------------------------------------------- The U.S. Bankruptcy court for the Northern District of Illinois confirmed 1555 Wabash LLC's First Amended Plan of Liquidation as submitted on Sept. 27, 2012. As reported in the TCR on Nov. 30, 2012, the Plan implements the principal terms of the settlement agreement dated as of Sept. 19, 2012, among (i) the Debtor; (ii) New West Realty Development Corp; (iii) Theodore Mazola; (iv) August Mauro; and lender AmT CADC Venture, LLC. According to the Disclosure Statement, the settlement agreement provides, among other things, that: a) title to the property will be unconditionally transferred from the Debtor to the lender on the Effective Date; b) all cash remaining in the Debtor's bank accounts on the Effective Date will be transferred to the lender; and c) the Debtor will assume and assign to the lender the executory contracts and unexpired leases as the lender may designate in writing no later than five business days prior to the confirmation hearing. Pursuant to the Settlement, the Plan provides for the irrevocable sale and transfer of the property and all other assets of the Debtor's estate, including all cash held in the Debtor's bank accounts on the Effective Date. Payments to creditors under the Plan will be made from funds realized from continued business operations of the Debtor up to the Effective Date and from existing cash deposits and cash resources of the debtor, well as from the cash resources of the lender. A copy of the Findings of Fact, Conclusions of Law and Order Confirming the Debtor's First Amended Plan of Liquidation is available at http://bankrupt.com/misc/1555wabash.doc137.pdf A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/1555_WABASH_ds_1amended.pdf 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. 501 GRANT: Court Enters Order for Relief in Involuntary Case ------------------------------------------------------------ The U.S. Bankruptcy Court for the Central District of California entered an order for relief under Chapter 11 for 501 Grant Street Partners, LLC, after the Debtor failed to timely contest the involuntary Chapter 11 petition. On Nov. 14, 2012, Allied Barton Security Services LLC, Cost Company LP, MSA Systems INT and Gertrude Fox, filed an involuntary petition against the Debtor. On Dec. 5, the Court denied the Debtor's motion to dismiss or deny (1) omnibus motion filed by SA Challenger to dismiss, abstain or transfer; and (2) SA Challenger's motion for relief from the automatic stay and retention of receiver. The Debtor said, in its motion to dismiss SA Challenger's request, that the filing of the dismissal motion and the relief motion is improper at the stage of the proceeding and while SA Challenger may assert that its filings are a challenge to the involuntary proceeding, the applicable rules expressly prohibit the conduct. The Debtor added that pursuant to Rule 1011(a), only an alleged Debtor has the right to contest an involuntary proceeding. SA Challenger, in its motion to dismiss, abstain or transfer case, said that there is nothing to be accomplished in a voluntary bankruptcy case because, among other things: 1. there is a diminution in value of the estate; 2. there is no reasonable likelihood of rehabilitation; and 3. in a Nov. 1, 2012, order, the Pennsylvania Bankruptcy Court dismissed the Voluntary case and ordered that any refiling by the Alleged Debtor would require the unanimous consent of all the Alleged Debtor's members or else it would be dismissed with prejudice. About 501 Grant Street & Union Trust Building An involuntary Chapter 11 bankruptcy petition was filed against 501 Grant Street Partners LLC, based in Woodland Hills, California (Bankr. C.D. Calif. Case No. 12-20066) on Nov. 14, 2012. The petitioning creditors are Allied Barton Security Services LLC, owed $960 for security services; Cost Company LP, $5,900 owed for masonry work; and MSA Systems Integration Inc., owed $2,401 for unpaid invoice. Malhar S. Pagay, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the petitioning creditors. 501 Grant Street Partners owns the Union Trust Building in downtown Pittsburgh, Pennsylvania. It sought Chapter 11 protection (Bankr. W.D. Pa. Case No. 12-23890) on Aug. 3, 2012, to avert a sheriff sale of the building set for Aug. 6. The August petition estimated under $50,000 in both assets and debts. Roger M. Bould, Esq., at Keevican Weiss Bauerle & Hirsch, LLC, represented 501 Grant Street as counsel. In November, U.S. Bankruptcy Judge Judith K. Fitzgerald dismissed 501 Grant Street Partners' Chapter 11 petition, paving for the sheriff sale of the Union Trust Building on Jan. 7, 2013. The order for relief from the involuntary case was signed on Dec. 13, 2012. SA Challenger Inc., which acquired interest in the building's mortgage by U.S. Bank, is seeking to foreclose on the property. SA Challenger is seeking to collect $41.4 million. Earlier in November, at the lender's request, Judge Ward appointed the real estate firm CBRE to serve as receiver for the building, overseeing its operation and management until the sheriff sale takes place. A123 SYSTEMS: Wanxiang, Navitas Sale Expected to Close by Feb. 1 ---------------------------------------------------------------- BankruptcyData reported that A123 Systems provided an update regarding the previously announced asset purchase agreements with Wanxiang America Corporation and Navitas Systems. The Company, according to the report, announced, "A123 continues to work with Wanxiang and Navitas to prepare for the closing of the transactions contemplated by the asset purchase agreements. A123 currently expects that the transactions will close pursuant to the terms set forth in the asset purchase agreements by February 1, 2013." About A123 Systems Based in Waltham, Massachusetts, A123 Systems Inc. designs, develops, manufactures and sells advanced rechargeable lithium-ion batteries and battery systems and provides research and development services to government agencies and commercial customers. A123 is the recipient of a $249 million federal grant from the Obama administration. Pre-bankruptcy, A123 had an agreement to sell an 80% stake to Chinese auto-parts maker Wanxiang Group Corp. U.S. lawmakers opposed the deal over concerns on the transfer of American taxpayer dollars and technology to China. A123 didn't make a $2.7 million payment due Oct. 15 on $143.75 million in 3.75% convertible subordinated notes due 2016. A123 and U.S. affiliates, A123 Securities Corporation and Grid Storage Holdings LLC, sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 12-12859 to 12-12861) on Oct. 16, 2012. A123 disclosed assets of $459.8 million and liabilities totaling $376 million. Debt includes $143.8 million on 3.75% convertible subordinated notes. Other liabilities include $22.5 million on a bridge loan owing to Wanziang. About $33 million is owed to trade suppliers. The Hon. Kevin J. Carey presides over the case. Lawyers at Richards, Layton & Finger, P.A., and Latham & Watkins LLP serve as the Debtors' counsel. Lazard Freres & Co. LLC acts as the Debtors' financial advisors, while Alvarez & Marsal serves as restructuring advisors. Logan & Company Inc. serves as the Debtors' claims and noticing agent. Wanxiang America Corporation and Wanxiang Clean Energy USA Corp. are represented in the case by lawyers at Young Conaway Stargatt & Taylor, LLP, and Sidley Austin LLP. JCI is represented in the case by Josh Feltman, Esq., at Wachtell Lipton Rosen & Katz LLP. An official committee of unsecured creditors has been appointed in the case. The Committee is represented by lawyers at Brown Rudnick LLP and Saul Ewing LLP. A123 sought bankruptcy protection with a deal to sell its auto- business assets to Johnson Controls Inc. The deal with JCI is valued at $125 million, and subject to higher offers at a bankruptcy auction. At an auction early in December, JCI's bid was topped by Wanxiang America's $256.6 million offer. The Bankruptcy Court approved the sale on Dec. 11. Wanxiang is buying most of A123, except for its government business. Navitas Systems, a Chicago-area company spun off from Sun MicroSystems, is buying A123's government business for $2.25 million. JCI has filed an appeal from the sale approval. ABDIANA A: Combined Plan, Disclosure Statement Hearing on Jan. 28 ----------------------------------------------------------------- Abdiana A LLC will return to the Bankruptcy Court in Kansas City, Missouri, on Jan. 28 at 9:30 a.m. for a combined hearing on its plan of reorganization and explanatory disclosure statement. The Bankruptcy Court on Dec. 26 issued a preliminary order approving the Disclosure Statement. The plan documents were filed Dec. 21. Objections to the plan were due Jan. 23. Plan votes were also due that day. "The Plan reflects the Debtor's determined effort to maintain the economic integrity of the business of Debtor and promote the greatest value for the benefit of its creditors. The Debtor believes that creditors will receive more value under the Plan than they would receive if the Debtor were liquidated under Chapter 7 of the Bankruptcy Code and that the Plan offers prospects for the highest and best recovery to creditors that can be obtained," the Disclosure Statement said. Holders of secured claims are classified in Classes 1 through 3. Holders of unsecured Allowed Claims are classified as Class 4. All Allowed Claims will be paid in full: * Class 1 -- the Claim of Arvest Bank in the total amount of $9,800,000, secured by a lien on Debtor's real property -- will be paid on a 25-year amortization with interest at the rate of 4.5% per annum, with payment of excess cash flow and a balloon payment after five years; * Class 2 -- the secured Claim of Kansas City Power and Light Company in the sum of $4,866 -- will be paid on a five-year amortization with interest at the rate of 3.25% per annum; * Class 3 -- the secured Claim of Missouri Gas Energy in the sum of $250 -- will be paid in full within 60 days after the Effective Date; and * Class 4 -- consists of general unsecured Claims in the amount of $27,838.50 -- will be paid in monthly installments on a five-year amortization with interest at the rate of 3.25% per annum. The holder of 100% membership interest in the Debtor will retain its equity interest in the Reorganized Debtor equal to the member interest it held in the Debtor pre-Petition. The Debtor owns seven tracts of real property in Kansas City, Missouri: * 318 E. 10th St., Kansas City, Missouri 64108; * 620 E. 18th St., Kansas City, Missouri 64108; * 1726 Holmes, Kansas City, Missouri 64108; * 1917 McGee St., Kansas City, Missouri 64108; * 2001 Grand Ave., Kansas City, Missouri 64108; * 2547 Cherry St., Kansas City, Missouri 64108; and * 7100 - 7140 Wornall Rd., Kansas City, Missouri 64114 All of the parcels are subject to deeds of trust in favor of Arvest Bank. Several of the properties provide substantial cash flow in the form of rents. The aggregate value of the properties is approximately $10.4 million. As of Sept. 30, 2012, the principal balance owed to Arvest Bank is $9,279,773.06, and Arvest Bank claims additional amounts as interest, late charges, costs and fees under loan documents. At the bankruptcy filing, the total monthly rent from the Debtor's tenants is roughly $84,000 to $85,000. The properties at 318 E. 10th St. and 1726 Holmes/620 E. 18th St. are not presently income producing. The Debtor sought bankruptcy protection on Sept. 25 to halt foreclosure efforts by Arvest in September 2012. The Debtor had encountered financial problems after a tenant in the property 1726 Holmes, which had been paying rent of roughly $55,000 per month as a tenant of the Debtor's predecessor, breached the lease and ceased paying rent. The building was vandalized and the insurer refused to pay the loss. A lawsuit brought by the Debtor's predecessor in title to recover substantial loss is pending. The Debtor was without resources to repair the building so as to restore the flow of rental income from a replacement tenant. Principals of the Debtor attempted to continue the debt service on the properties. A Forbearance Agreement with Arvest was entered in March, 2011, with a maturity date of July 31, 2012, later expired and in early August 2012, the bank made a demand for payment of the entire balance. Restructuring Consultants Early in November, Abdiana A filed papers in Bankruptcy Court seeking permission to employ Randall M. Nay, Financial Asset Resolution LLC, and Rick L. Smalley as restructuring consultants to assist in providing analysis of financial records of the Debtor, developing financial projections, assisting in preparation of financial reports required in the bankruptcy case, assisting in the development of the Debtor's Disclosure Statement and Plan, and providing opinions and testimony relating to the feasibility of the Plan, appropriate discount rate or rate of interest and other restructuring or confirmation issues. In December, the Debtor filed another set of papers asking the Court to approve the restructuring consulants' engagement effective as of the petition date. The Debtor said the consultants do not hold or represent interests materially adverse to the Debtor, its estate, creditors, other parties in interest or their attorneys or accountants in matters for which they are to be employed and are disinterested within the meaning of 11 U.S.C. Sec. 101(14) and 327. The Debtor in its December court papers proposed that, commencing with periods from and after Sept. 25, 2012, the Restructuring Consultants will be entitled to be paid interim compensation of 80% of all fees for professional services rendered and 100% of all charges for actual and necessary out-of-pocket expenses incurred by Restructuring Consultants on a monthly basis. Any amount paid for fees in excess of 80% of the fee amounts reflected in the monthly itemized statements will be held in trust unless and until the entry of a Court order allowing the interim fee applications for the Restructuring Consultants. Abdiana A, LLC, filed for Chapter 11 bankruptcy (Bankr. W.D. Mo. Case No. 12-44005) on Sept. 25, 2012, estimating at least $10 million in assets and debts. Abdiana A's business consists of ownership and operation of various real properties in Kansas City, Missouri. Bankruptcy Judge Arthur B. Federman oversees the case. Arvest Bank is represented by: Laurence M. Frazen, Esq. Elizabeth A. Haden, Esq. BRYAN CAVE LLP 1200 Main Street, Suite 3500 Kansas City, MO 64105 Telephone: (816) 374-3200 Facsimile: (816) 374-3300 E-mail: lfrazen@bryancave.com beth.haden@bryancave.com ABDIANA A: Can Use Arvest Cash Through March 2013 ------------------------------------------------- Abdiana A LLC is financing its chapter 11 reorganization from the use of cash tied to prepetition debt owed to Arvest Bank. In court filings last month, Abdiana and the Bank agreed to the Debtor's continued use of cash collateral through March 31, 2013. The Debtor sought bankruptcy protection to avert foreclosure efforts by Arvest in September 2012. As of Sept. 30, 2012, the principal balance owed to Arvest is $9,279,773.06, and the Bank claims additional amounts as interest, late charges, costs and fees under loan documents. Abdiana A, LLC, filed for Chapter 11 bankruptcy (Bankr. W.D. Mo. Case No. 12-44005) on Sept. 25, 2012, estimating at least $10 million in assets and debts. Abdiana A's business consists of ownership and operation of various real properties in Kansas City, Missouri. Bankruptcy Judge Arthur B. Federman oversees the case. Arvest Bank is represented by Laurence M. Frazen, Esq., and Elizabeth A. Haden, Esq., at Bryan Cave LLP. ABSOLUTE LIFE: Incurs $4.7 Million Net Loss in Nov. 30 Quarter -------------------------------------------------------------- Absolute Life Solutions, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $4.68 million for the three months ended Nov. 30, 2012, compared with a net loss of $4.38 million for the same period a year ago. The Company's balance sheet at Nov. 30, 2012, showed $10.4 million in total assets, $10.6 million in total liabilities and a $125,000 total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/4ytxB8 About Absolute Life New York, N.Y.-based Absolute Life Solutions, Inc., is a specialty financial services company engaged in the business of purchasing life settlement contracts for long-term investment purposes. Marcum LLP, in New York, N.Y., expressed substantial doubt about Absolute Life's ability to continue as a going concern following the Company's results for the fiscal year ended Aug. 31, 2011. The independent auditors noted that the Company that the continued existence of the Company is dependent upon its ability to generate profit from its life settlement investments and to meet its obligations as they become due. "The demand for and selling prices of the Company's products, may not be sufficient to meet cash flow expectations. These conditions raise substantial doubt about the Company's ability to continue as a going concern." AGRIPARTNERS LIMITED: Employs Philip Landau as Counsel ------------------------------------------------------ Agripartners Limited Partnership's seeking to employ Philip J. Landau and Shraiberg, Ferrara & Landau, P.A., as general bankruptcy counsel. SFL will receive a total retainer of $51,046 and SFL agreed to perform services at these hourly rates: Legal Assistants $110 Attorneys $220 to $450 Mr. Landau $450 SFL has received a $26,046 retainer. SFL will receive a $20,000 retainer on Feb. 15, and an additional $5,000 by March 15. To the best of the Debtor's knowledge the firm does not represent any interest adverse to the Debtor or the estate. Agripartners Limited Partnership filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 12-19214) in Ft. Myers, Florida on Dec. 24, 2012. The Debtor estimated assets of at least $100 million and liabilities of at least $50 million. AGRIPARTNERS LIMITED: Taps Miller and Hollander as Local Counsel ---------------------------------------------------------------- Agripartners Limited Partnership's seeking to employ Richard Hollander, founding partner, and the law firm of Miller and Hollander as local counsel. The hourly rates of MH's personnel are: Legal Assistants $110 Attorneys $240 to $450 Mr. Hollander $450 Mr. Hollander assures the Court that the firm does not represent any interest adverse to the Debtor, the estate or its creditors. Agripartners Limited Partnership filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 12-19214) in Ft. Myers, Florida on Dec. 24, 2012. Attorneys at Shraiberg, Ferrara & Landau, P.A., and Miller & Hollander serve as lead counsel to the Debtor. The Debtor estimated assets of at least $100 million and liabilities of at least $50 million. ALLEN FAMILY: Clifford Zucker Designated as Liquidating Trustee --------------------------------------------------------------- The Official Committee of Unsecured Creditors of Allen Family Foods Inc., et al., designated Clifford Zucker of CohnReznick LLP as liquidating trustee. The Debtors' Chapter 11 plan, which confirmed by the bankruptcy judge in December, provided for the creation of a trustee to liquidate the remaining assets, claims and causes of action the Debtors and distribute the proceeds to creditors. The Debtors sold their business in September 2011 to Korean poultry producer Harim Co., generating $45.2 million. A settlement with the lender gave unsecured creditors $5 million. The bank also agreed to waive claims, so it won't share in distributions to unsecured creditors as a result of a shortfall in payment of the secured claim. Under the plan, unsecured creditors with $32.2 million in claims were projected to make a 10% recovery. About Allen Family Foods Allen Family Foods Inc. is a 92-year-old Seaford, Del., 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. ALLIED IRISH: Mortgage Bank Raises EUR500MM From Bond Issue ----------------------------------------------------------- AIB Mortgage Bank agreed a EUR500 million 3.5-year secured ACS bond issue under its EUR20 billion Mortgage Covered Securities Programme. AIBMB is a wholly owned subsidiary of AIB. This is AIBMB's second successful recent return to the ACS market following the EUR500m 3-year issuance in November 2012. ACS bonds are not guaranteed by the Irish State. This 3.5-year deal was priced at a spread over mid-swaps of 185 basis points and was oversubscribed more than four times. The total order book was c. EUR2.2 billion with in excess of 160 international investors reflecting a well placed and diversified profile. Demand came from 20 countries with 99% placed outside Ireland. This transaction demonstrates the continued progress of AIB's strategy of engaging with the market in a balanced and measured manner. About Allied Irish Banks Allied Irish Banks, p.l.c. -- http://www.aibgroup.com/-- is a major commercial bank based in Ireland. It has an extensive branch network across the country, a head office in Dublin and a capital markets operation based in the International Financial Services Centre in Dublin. AIB also has retail and corporate businesses in the UK, offices in Europe and a subsidiary company in the Isle of Man and Jersey (Channel Islands). Since the onset of the global and Irish financial crisis, AIB's relationship with the Irish Government has changed significantly. As at Dec. 31, 2010, the Government, through the National Pension Reserve Fund Commission ("NPRFC"), held 49.9% of the ordinary shares of the Company (the share of the voting rights at shareholders' general meetings), 10,489,899,564 convertible non- voting ("CNV") shares and 3.5 billion 2009 Preference Shares. On April 8, 2011, the NPRFC converted the total outstanding amount of CNV shares into 10,489,899,564 ordinary shares of AIB, thereby increasing its holding to 92.8% of the ordinary share capital. In addition to its shareholders' interests, the Government's relationship with AIB is reflected through formal and informal oversight by the Minister and the Department of Finance and the Central Bank of Ireland, representation on the Board of Directors (three non-executive directors are Government nominees), participation in NAMA, and otherwise. The Company reported a loss of EUR2.29 billion in 2011, a loss of EUR10.16 billion in 2010, and a loss of EUR2.33 billion in 2009. Allied Irish's consolidated statement of financial position for the year ended Dec. 31, 2011, showed EUR136.65 billion in total assets, EUR122.18 billion in total liabilities and EUR14.46 billion in shareholders' equity. Allied Irish's balance sheet at June 30, 2012, showed EUR129.85 billion in total assets, EUR116.59 billion in total liabilities and EUR13.26 billion in total shareholders' equity. AMERICAN AIRLINES: Wins Court Nod to Pay Off $1.32-Bil. in Loans ---------------------------------------------------------------- AMR Corp. obtained approval from Judge Sean Lane of the U.S. Bankruptcy Court for the Southern District of New York to pay off $1.32 billion in loans secured by aircraft without paying a so-called make-whole premium required outside of bankruptcy if the debt were repaid before maturity, Bloomberg News reported. A make-whole is designed to compensate a lender for loss of an investment bearing interest higher than the current market. In a 43-page opinion issued on January 17, Judge Lane rejected all arguments made by U.S. Bank NA, the indenture trustee for the bondholders. U.S. Bank, arguing the make-whole is due, relied in part on the so-called 1110 election AMR made early in the bankruptcy. The term, which is derived from Section 1110 of the Bankruptcy Code, requires an airline to decide within 60 days of bankruptcy whether to retain aircraft. If the airline elects to keep aircraft, it must agree to "perform all obligations" under the loan documents. Judge Lane rejected the idea that the 1110 election obliged AMR to pay the make-whole. He pointed to provisions in the indenture saying that the make-whole isn't owing if the underlying default results from bankruptcy, Bloomberg News reported. The bankruptcy judge said the 1110 election didn't cure the bankruptcy default, thus still invoking the indenture provision saying no make-whole is due following a bankruptcy default. A full-text copy of the January 17 opinion can be accessed for free at http://is.gd/RtT9xx AMR will repay the debt with a new $1.5 billion aircraft financing, saving $200 million through lower interest rates. The new financing will be implemented before AMR emerges from bankruptcy protection, Bloomberg News reported. The loans being paid off call for interest at rates between 8.6% and 13%. AMR said the new debt will bear interest comparable to the 4% to 4.75% rates other major airlines recently negotiated. If the make-whole payment were required, AMR would be obliged to repay 155% of the $425 million owing on 10.375% first-lien bonds due 2021, according to the report. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Bankr. Judge Allows Pilot's Appeal to Proceed ---------------------------------------------------------------- The U.S. Bankruptcy Court in Manhattan lifted the automatic stay to allow an appeals court to rule on the appeal filed by a former American Airlines pilot. The decision allows the U.S. Court of Appeals for the 11th Circuit to rule on the appeal filed by Lawrence Meadows. The ruling, however, prohibits the prosecution of any further proceedings in connection with the appeal. Mr. Meadows appealed the dismissal of his case by a lower court where he sought payment of long-term disability benefits under the airline's 2004 pilot retirement plan. The former pilot was terminated in October 2011 pursuant to a provision of American Airlines' labor contract with pilots, which states that pilots who have been inactive for longer than five years will be terminated. Because of his newly diagnosed condition, Mr. Meadows became eligible to receive disability benefits under another plan in December 2011. Under the new plan, however, he only receives half of what he received under the 2004 plan. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Gets OK on Purchase Deals with Boeing, et al. ---------------------------------------------------------------- Maria Chutchian of BankruptcyLaw360 reported that a New York bankruptcy judge on Wednesday approved four settlements allowing AMR Corp. to assume aircraft and engine purchase agreements with Boeing Co., General Electric Co., Rolls-Royce PLC and Airbus SAS that the bankrupt company said is critical to its eventual exit from bankruptcy. U.S. Bankruptcy Judge Sean Lane signed off on the deals, which allow the Fort Worth, Texas-based American Airlines parent to maintain contractual relationships with the four companies by assuming purchase agreements signed before AMR entered Chapter 11 or enter into new ones, the report related. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Inks Capacity Purchase Agreement with Republic ----------------------------------------------------------------- Republic Airways Holdings Inc. on Jan. 24 disclosed that it has reached an agreement with American Airlines to operate 53 Embraer E175 aircraft under the American Eagle brand. The Capacity Purchase Agreement (CPA) will be operated by the Company's Republic Airlines subsidiary, with service expected to start in June of 2013. The CPA is subject to approval by the Bankruptcy Court in the American Airlines bankruptcy proceedings. "We are thrilled that American has selected Republic and the Embraer E175 to expand their network with large regional jets," said Republic Chairman, President and CEO Bryan Bedford. "The Embraer E175 is an outstanding aircraft and the interior design American has selected will provide a world-class, seamless product for their customers flying on Republic." "Establishing a large regional jet fleet has long been part of our business plan," said Chuck Schubert, American's vice president - Network Planning, "and this agreement is another example of how we are executing on that plan in a way that benefits our business and our customers." Republic also signed an agreement with Embraer to purchase 47 new aircraft and lease a previously owned Embraer E175 jet aircraft, including the first deliveries of Embraer's enhanced fuel performance aircraft. In addition, the Company will acquire five previously owned E175s from a third party. The aircraft, which will seat 76 passengers in a two-class cabin, are expected to be phased into operation at approximately two to three aircraft per month beginning in mid-2013 through the first quarter of 2015. Each aircraft will operate under the CPA for 12 years from its in-service date, extending the term of the agreement into 2027. Republic's contract with Embraer also includes an option with delivery positions exercisable beginning in 2015, for the purchase of an additional 47 aircraft. "It is significant that our long-time, valued customer Republic Airways -- a true innovator in the regional transport business -- is the first customer for the enhanced E175," said Paulo Cesar Silva, President and CEO, Embraer Commercial Aviation. "It's a perfect example of how our investments in product development make our customers more competitive in their markets." About Republic Airways Holdings Based in Indianapolis, Indiana, Republic Airways Holdings -- http://www.rjet.com-- is an airline holding company that owns Chautauqua Airlines, Frontier Airlines, Republic Airlines and Shuttle America, collectively "the airlines." The airlines operate a combined fleet of more than 280 aircraft and offer scheduled passenger service on nearly 1,500 flights daily to over 145 cities in the U.S. as well as to the Bahamas, Canada, Costa Rica, Dominican Republic, Jamaica, and Mexico under branded operations at Frontier, and through fixed-fee flights operated under airline partner brands, including AmericanConnection, Continental Express, Delta Connection, United Express, and US Airways Express. The airlines currently employ approximately 10,000 aviation professionals. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Groom Law Discloses New Hourly Rates ------------------------------------------------------- Gary M. Ford, Esq., a principal of the law firm of Groom Law Group, Chartered, in Washington, D.C., filed a supplemental declaration disclosing the firm's new hourly rates for the year 2013: Professional Old Rate New Rate ------------ -------- -------- Amin, Hisham $570 $595 Benjamin, Dionne $400 $455 Breyfogle, Jon $805 $855 Carolan, Mark $355 $365 Cole, James $620 $640 Coleman, Joshua $355 $420 Dahm, Kimberly $435 $500 Daines, Kendall $625 $645 Del Conte, Michael $435 $500 Dold, Elizabeth $680 $720 Ell, Douglas $855 $895 Eller, Jennifer $630 $660 Esedebe, Ada $305 $320 Fitzgerald, Thomas $820 $855 Ford, Gary $875 $910 Golumbic, Lars $640 $665 Goodwin, Ellen $605 $630 Groom, Theodore $855 $890 Hassel, Lonie $755 $780 Hughes, Cheryl $600 $625 Kamen, Katherine $605 $630 Keller, Christine $640 $670 Killion, Tamara $570 $595 Kroh, Jeffrey $580 $605 Lanoff, Ian $790 $790 Lechner, Emily $305 $320 Lee, Jason $545 $595 Levine, David $660 $695 Lofgren, Mark $725 $755 Maricco, Michael $570 $600 Matta, Richard $705 $745 Mazawey, Louis $855 $890 McGuiness, John $680 $710 McTyre, Nancy $305 $365 Meehan, Edward $800 $840 Nielsen, Mark $620 $645 Powell, David $755 $780 Prame, Michael $680 $710 Roberts, Thomas $670 $700 Rogers, Allison B. $355 $420 Ryan, Alexander $575 $600 Saxon, Steven $855 $890 Scallet, Edward $820 $855 Sepsakos, George $400 $455 Soderstrom, Kara $435 $500 St. Marin, Andree $790 $835 Sweetnam, William $795 $795 Temme, Ryan $305 $365 Tumility, Allison $400 $455 Turner, Vivian $480 $525 Ufford, Roberta $725 $755 Walsh, Kevin $355 $420 Wilder, Will $505 $570 Winters, Brigen $680 $710 Witt, Jeff $570 $595 Zaklad, Rosie $505 $570 Zuckerman, Julia $545 $595 Zumwalt, Sarah $570 $600 Paraprofessional's hourly rates for 2013 will range from $140 to $325. As reported in the March 16, 2012 edition of the TCR, the Debtors obtained permission to employ Groom Law Group, Chartered as special employee benefits counsel, nunc pro tunc to the Petition Date. The Debtors selected the firm because of its "invaluable experience in providing legal services in connection with employee benefit plans and related issues." American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN MEDIA: Avenue Appointee Leaves Board --------------------------------------------- American Media, Inc., on Jan. 16, 2013, received a letter from Daniel Flores stating that he resigned, effective immediately, from his position on the board of directors. Mr. Flores, who was appointed to the board by the "Avenue stockholders" resigned to pursue other business interests and not as a result of any dispute or disagreement with the Company. The Company expects to fill the vacancy created by Mr. Flores' resignation in the short-term. About American Media Based in New York, American Media, Inc., publishes celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI manages 14 different Web sites. The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company. American Media, Inc., and 15 units, including American Media Operations, Inc., filed for Chapter 11 protection in Manhattan (Bankr. S.D.N.Y. Case No. 10-16140) on Nov. 17, 2010, with a prepackaged plan. The Debtors emerged from Chapter 11 reorganization in December 2010, handing ownership to former bondholders. The new owners include hedge funds Avenue Capital Group and Angelo Gordon & Co. The Company's balance sheet at Sept. 30, 2012, showed $632.80 million in total assets, $654.44 million in total liabilities, $3.78 million in redeemable noncontrolling interest, and a $25.41 million total stockholders' deficit. * * * As reported by the TCR on Jan. 22, 2013, Standard & Poor's Ratings Services lowered its corporate credit rating on Boca Raton, Fla.- based American Media Inc. to 'CCC+ ' from 'B-'. "The downgrade conveys our expectation that continued declines in circulation and advertising revenues will outweigh the company's cost reductions, resulting in deteriorating operating performance, rising debt leverage, and thinning discretionary cash flow," said Standard & Poor's credit analyst Hal Diamond. AMERICAN NATURAL: Shareholders Approve 2012 Stock Option Plan ------------------------------------------------------------- In the annual meeting of shareholders of American Natural Energy Corp. held Jan. 11, shareholders approved 2012 Stock Option Plan, and elected Michael K. Paulk, Steven P. Ensz, Douglas MacGregor, James L Ferraro and William Yuan to the Board of directors. The shareholders also approved the conversion of the Palo Verde debenture and the exercise of the Warrants without the beneficial ownership limitation. A copy of the 2012 Stock Option Plan is available at http://is.gd/bKEp6l About American Natural American Natural Energy Corporation is a Tulsa, Oklahoma based independent exploration and production company with operations in St. Charles Parish, Louisiana. The Company's balance sheet at Sept. 30, 2012, showed $20.2 million in total assets, $13.3 million in total liabilities, and stockholders' equity of $6.9 million. As reported in the TCR on April 3, 2012, MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt about American Natural's ability to continue as a going concern. The independent auditors noted that the Company incurred a net loss in 2011 and has a working capital deficiency and an accumulated deficit at Dec. 31, 2011. AMPAL-AMERICAN: Epiq Approved as Administrative Agent ----------------------------------------------------- The Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for the Southern District of New York entered an order authorizing Ampal- American Israel Corp., to employ Epiq Bankruptcy Solutions, LLC as administrative agent. The judge earlier entered an order approving Epiq as claims and noticing agent. Epiq will serve as the custodian of court records and will be designated as the authorized repository for all proofs of claim filed in the Chapter 11 case and is authorized and directed to maintain the official claims registers for the Debtor and to provide the Clerk with a certified duplicate thereof upon the request of the Clerk. About Ampal-American Ampal-American Israel Corporation -- http://www.ampal.com/-- acquired interests primarily in businesses located in Israel or that are Israel-related. Ampal-American filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-13689) on Aug. 29, 2012, to restructure the Company's Series A, Series B and Series C debentures. Bankruptcy Judge Stuart M. Bernstein presides over the case. Ampal-American sought bankruptcy protection in the U.S. because bankruptcy laws in Israel would lead to the Company's liquidation. Michelle McMahon, Esq., at Bryan Cave LLP, serves as the Debtor's counsel. Houlihan Lokey serves as investment banker. The petition was signed by Irit Eluz, chief financial officer, senior vice president. The Company scheduled $290,664,095 in total assets and $349,413,858 in total liabilities. The Court terminated the Debtor's exclusive periods to file and solicit acceptances for the proposed Chapter 11 Plan, to permit the Official Committee of Unsecured Creditors to file and seek confirmation of a plan. A three-member Committee is represented by Brown Rudnick as counsel. The Committee has proposed a Chapter 11 Plan for the Debtor pursuant to a settlement with the Debtor. The Amended Plan of Reorganization proposed by the Committee provides that distributions to holders of Allowed General Unsecured Claims against the Debtor's estate in satisfaction of each such holder's Claim will be the pro rata share (after payment in cash out of funds held in the Series B Deposit Account and the Series C Deposit Account) of either (i) 100% of the Preferred Stock of the Reorganized Debtor or (ii) the cash payment if the Equity Buyout Option is exercised pursuant to Section 4.7 of the Plan. ANLOC LLC: Services by Unlicensed Persons Cost Claims ----------------------------------------------------- Bankruptcy Judge Marvin Isgur disallowed claims, in their entirety, two claims filed by Edward Talone Trust No. 1 against Anloc, LLC, a Texas Railroad Commission Operator, which has been approved to operate crude oil and natural gas leases in Texas. Judge Isgur said the claims are disallowed because they seek compensation for engineering services performed by unlicensed persons in violation of the Texas Engineering Practices Act. A copy of the Court's Jan. 22, 2013 Memorandum Opinion is available at http://is.gd/reXWjKfrom Leagle.com. An involuntary Chapter 11 bankruptcy petition was filed against Anloc LLC (Bankr. S.D. Tex. Case No. 12-31267) on Feb. 16, 2012. The involuntary case was converted to a chapter 11 on April 20, 2012. APPLIED DNA: Opted to Repurchase Warrants for $50,000 ----------------------------------------------------- Applied DNA Sciences, Inc., exercised its option to repurchase the Series C Warrants issued to Crede CG II, Ltd., for $50,000. The Series C Warrants held by Crede were to initially purchase 26,881,720 shares of the Company's Common Stock, $.001 par value, at an initial exercise price per share of $.2232. The Series C Warrants were issued to Crede in connection with its $7.5 million investment in the Company pursuant to a Securities Purchase Agreement with the Company dated Nov. 28, 2012. About Applied DNA Stony Brook, N.Y.-based Applied DNA Sciences, Inc., is principally devoted to developing DNA embedded biotechnology security solutions in the United States. The Company's shares of common stock are quoted on the OTC Bulletin Board under the symbol "APDN." Applied DNA incurred a net loss of $7.15 million for the year ended Sept. 30, 2012, compared with a net loss of $10.51 million for the year ended Sept. 30, 2011. The Company's balance sheet at Sept. 30, 2012, showed $1.34 million in total assets, $592,009 in total liabilities, all current, and $756,925 in total stockholders' equity. ARCAPITA BANK: Plan Filing Exclusivity Expires Jan. 28 ------------------------------------------------------ The Hon. Sean H. Lane of the U.S. Bankruptcy Court Southern District of New York extended Arcapita Bank B.S.C.(c), et al.'s exclusive period to propose a plan of reorganization until Jan. 28, 2013, and the period to solicit acceptances for that plan until March 28, respectively. As reported in the TCR on Jan. 14, 2013, the Debtors said in their motion for an extension that they are prepared to file a Chapter 11 Plan. However, they are still in talks with the Official Committee of Unsecured Creditors, and the Joint Provisional Liquidators of AIHL regarding a resolution of certain inter- creditor and inter-estate issues. The parties are engaged in an ongoing analysis of how to allocate the assets between the creditors of Arcapita Bank and the creditors of AIHL. The Debtors said that negotiations are ongoing and some issues still remained unresolved. 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. ASARCO LLC: Sterlite Sued Over Fees from Failed $2.6-Bil. Deal -------------------------------------------------------------- Jake Simpson of BankruptcyLaw360 reported that law firm Harkins Cunningham LLP filed a breach of contract suit against Sterlite (USA) Inc. and its Indian parent in Washington federal court Tuesday, claiming the mining company failed to pay the firm for services related to Sterlite's alleged breach of a $2.6 billion acquisition of bankrupt miner Asarco LLC. Harkins said Sterlite owes the firm roughly $80,000 for its work as counsel in regulatory proceedings related to Sterlite's proposed acquisition of a rail unit of Asarco in 2009, the report related. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection (Bankr. S.D. Tex. Case No. 05-21207) on Aug. 9, 2005. Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On Dec. 9, 2009, Asarco Incorporated and Americas Mining Corporation's Seventh Amended Plan of Reorganization for the Debtors became effective and the ASARCO Asbestos Personal Injury Settlement Trust was created and funded with nearly $1 billion in assets, including more than $650 million in cash plus a $280 million secured note from Reorganized ASARCO. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated ASARCO LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. About Sterlite (US) Mumbai, India-based Sterlite Industries (India) Limited produces copper in India and specializes in manufacturing continuous-cast copper rods. The Company operates two mines in Australia, but its primary business is the operation of India's largest copper smelting and refining plant. ATARI INC: Says Most Debt Owing to Bankrupt French Parent --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Atari Inc. disclosed assets of $33.7 million and $310 million in debt, including $257 million owing to affiliates not in the U.S. bankruptcy. The U.S. company contends that debt owing to its parent, Atari S.A., should be treated as equity. The U.S. company also challenges the secured status of debt to the parent and to Blue Ray Value Recover (Master) Fund Ltd. Otherwise, there is no secured debt, according to the U.S. company's court filing. Mr. Rochelle relates that for example, the parent has a filing listing a security interest in the U.S. company's assets. The U.S. company says there is no agreement granting a lien to the parent. The Chapter 11 process, intended to result in a sale within a few months, will be financed with a $5.25 million loan from Tenor Capital Management Co., from which $2.25 million would be available on an interim basis. Part of the loan will be furnished only when papers are filed to sell the assets. The U.S. company, the report discloses, said that the French parent will likely file a Chapter 15 petition in the U.S. where the U.S. judge could stop creditor actions and assist the court in France. About Atari Atari -- http://www.atari.com-- is a multi-platform, global interactive entertainment and licensing company. Atari owns and/or manages a portfolio of more than 200 games and franchises, including world renowned brands like Asteroids(R), Centipede(R), Missile Command(R), Pong(R), Test Drive(R), Backyard Sports(R), and Rollercoaster Tycoon(R). Atari Inc. and its U.S. affiliates filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Lead Case No. 13-10176) on Jan. 21, 2013, to break away from their unprofitable French parent company and secure independent capital. Peter S. Partee, Sr. and Michael P. Richman of Hunton & Williams LLP are proposed to serve as lead counsel for the U.S. companies in their respective Chapter 11 cases. BMC Group is the claims and notice agent. Protiviti Inc. is the financial advisor. ATP OIL: To Sell Deep-Water Wells at March 26 Auction ----------------------------------------------------- ATP Oil & Gas Corp. is asking a Texas bankruptcy judge for permission to quickly auction off its deepwater drilling properties in the Gulf of Mexico in whole or piece-by-piece. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that ATP Oil is being required by lenders financing the reorganization to sell deep-water oil and gas properties in the Gulf of Mexico. The auction will take place March 26 if the U.S. Bankruptcy Court in Houston approves sale procedures at a Feb. 14 hearing. ATP's shallow-water properties are being sold separately. According to the report, APT will be selling properties in 23 lease blocks, of which nine are producing. The deep-water properties have proved reserves of 65.4 million barrels of crude oil equivalent and 97.3 billion cubic feet of natural gas, according to a court filing. The report relates that if the Court approves the proposed procedures indications of interest will be due March 5, followed by initial bids on March 19, the March 26 auction, and a hearing to approve sale on March 28. No buyer is yet under contract. Financing for the Chapter 11 case requires completion of the sale by April 11. APT is required by the lenders to sell the assets because a geologist's report came in below a specified threshold. The $1.5 billion in 11.875% second-lien notes traded at 11:30 a.m. Jan. 23 for 7.9 cents on the dollar, according to Trace, the bond- price reporting system of the Financial Industry Regulatory Authority. About ATP Oil Houston, Tex.-based ATP Oil & Gas Corporation is an international offshore oil and gas development and production company focused in the Gulf of Mexico, Mediterranean Sea and North Sea. ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP, serve as bankruptcy counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts counsel. Opportune LLP is the financial advisor and Jefferies & Company is the investment banker. Kurtzman Carson Consultants LLC is the claims and notice agent. Filings with the Bankruptcy Court and claims information are available at http://www.kccllc.net/atpog ATP disclosed assets of $3.6 billion and $3.5 billion of liabilities as of March 31, 2012. Debt includes $365 million on a first-lien loan where Credit Suisse AG serves as agent. There is $1.5 billion on second-lien notes with Bank of New York Mellon Trust Co. as agent. ATP's other debt includes $35 million on convertible notes and $23.4 million owing to third parties for their shares of production revenue. Trade suppliers have claims for $147 million, ATP said in a court filing. An official committee of unsecured creditors has been appointed in the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley & McCloy, in New York, represents the Creditors Committee as counsel. BLUEGREEN CORP: Shareholders to Vote on BFC Merger Agreement ------------------------------------------------------------ Bluegreen Corporation, et al., jointly filed with the U.S. Securities and Exchange Commission an amendment no. 1 to Rule 13e- 3 Transaction Statement on Schedule 13E-3. On Nov. 14, 2012, Bluegreen entered into an Agreement and Plan of Merger with BFC Financial Corporation, Woodbridge Holdings, LLC, and BXG Florida Corporation, a wholly owned subsidiary of Woodbridge ("Merger Sub"). Pursuant to the Merger Agreement, Woodbridge will acquire Bluegreen through the merger of Merger Sub with and into Bluegreen, with Bluegreen continuing as the surviving corporation and a wholly owned subsidiary of Woodbridge. If the merger is completed, each share of Bluegreen's common stock, par value $0.01 per share, will be cancelled and converted automatically into the right to receive $10.00 in cash, without interest and less any applicable withholding taxes. BBX Capital has entered into a letter agreement with BFC, subject to the parties executing definitive documentation, to invest $71.75 million in Woodbridge at the effective time of the merger in exchange for a 46% equity interest in Woodbridge, with the proceeds from the investment to be utilized to pay a portion of the aggregate merger consideration. BFC, through Woodbridge, currently owns approximately 54% of the outstanding shares of Bluegreen common stock. BFC also directly owns shares of BBX Capital's Class A Common Stock and Class B Common Stock representing approximately 75% of the total voting power of such stock and 53% of the total outstanding shares of such stock. BFC may be deemed to be controlled by its Chairman, Chief Executive Officer and President, Alan B. Levan, and its Vice Chairman, John E. Abdo, who collectively hold shares of BFC's Class A Common Stock and Class B Common Stock representing approximately 72% of the total voting power of that stock. Messrs. Levan and Abdo also serve as non-executive Chairman and Vice Chairman, respectively, of Bluegreen. In addition, Mr. Levan is Chairman and Chief Executive Officer of BBX Capital, and Mr. Abdo is Vice Chairman of BBX Capital. Concurrently, Bluegreen filed with the SEC a revised preliminary proxy statement on Schedule 14A pursuant to Section 14(a) of the Securities Exchange Act of 1934, as amended, relating to a special meeting of the shareholders of Bluegreen on a date yet to be determined. At the special meeting, the shareholders of Bluegreen will consider and vote upon a proposal to approve the Merger Agreement. The approval of the Merger Agreement requires the affirmative vote of the holders of at least 66-2/3% of the outstanding shares of Bluegreen's common stock. The Merger is also subject to a number of other closing conditions, including the obtaining of all financing necessary to consummate the Merger. A copy of the Proxy Statement is available at http://is.gd/jVmkuI About Bluegreen Corp. Bluegreen Corporation -- http://www.bluegreencorp.com/-- provides places to live and play through its resorts and residential community businesses. The Company reported a net loss of $17.25 million in 2011, compared with a net loss of $43.96 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $1.06 billion in total assets, $720.24 million in total liabilities and $340.77 million in total shareholders' equity. * * * In December 2010, Standard & Poor's Rating Services raised its corporate credit rating on Bluegreen Corp to 'B-' from 'CCC'. BON-TON STORES: Unit to Redeem $65-Mil. Senior Notes on Feb. 22 --------------------------------------------------------------- The Bon-Ton Stores, Inc.'s wholly-owned subsidiary, The Bon-Ton Department Stores, Inc., issued a notice of partial redemption for $65 million aggregate principal amount of its outstanding 10 1/4% Senior Notes due 2014 at a cash redemption price equal to 100% of the principal amount of the 2014 Notes, plus accrued and unpaid interest, if any, to, but not including, the redemption date. The redemption date will be Feb. 22, 2013. Upon completion of the redemption, approximately $69 million aggregate principal amount of the 2014 Notes will remain outstanding. Payment of the redemption price will be made on or after the redemption date only upon presentation and surrender of the 2014 Notes to the paying agent. Interest on the 2014 Notes that have been called for redemption will cease to accrue on and after the redemption date. The notice of partial redemption will be sent by The Bank of New York Mellon, the trustee for the 2014 Notes, to the registered holders of the 2014 Notes. Copies of the notice of partial redemption and additional information relating to the procedure for redemption may be obtained from The Bank of New York Mellon at 1.800.254.2826. About Bon-Ton Stores The Bon-Ton Stores, Inc., with corporate headquarters in York, Pennsylvania and Milwaukee, Wisconsin, operates 273 department stores, which includes 11 furniture galleries, in 24 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's and Younkers nameplates and, in the Detroit, Michigan area, under the Parisian nameplate. The Company's balance sheet at Oct. 27, 2012, showed $1.84 billion in total assets, $1.80 billion in total liabilities, and $40.30 million in total shareholders' equity. * * * As reported by the TCR on July 13, 2012, Moody's Investors Service revised The Bon-Ton Stores, Inc.'s Probability of Default Rating to Caa1/LD from Caa3. The Caa1/LD rating reflects the company's exchange of $330 million of new senior secured notes due 2017 for $330 million of its unsecured notes due 2014. Moody's also affirmed the company's Corporate Family Rating at Caa1 and affirmed the Caa3 rating assigned to the company's senior unsecured notes due 2014. Moody's said the affirmation of the company's 'Caa1' corporate family rating reflects the company's persistent negative trends in sales and operating margins and uncertainties that the company's strategies to reverse these trends will be effective. BOOMERANG SYSTEMS: Stockholders Approve 2012 Stock Incentive Plan ----------------------------------------------------------------- The majority stockholders of Boomerang Systems, Inc., constituting a total of 4,044,093 shares of common stock (about 53.50%) approved in a written consent (i) an amendment to the Company's Certificate of Incorporation, as amended, to decrease the Company's authorized capital stock from 401,000,000 shares to 201,000,000 shares and the Company's authorized Common stock from 400,000,000 shares to 200,000,000 shares and (ii) the Company's 2012 Stock Incentive Plan. About Boomerang Systems Headquartered in Morristown, New Jersey, Boomerang Systems, Inc. (Pink Sheets: BMER) through its wholly owned subsidiary, Boomerang Utah, is engaged in the design, development, and marketing of automated racking and retrieval systems for automobile parking and automated racking and retrieval of containerized self-storage units. Boomerang incurred a net loss of $17.42 million for the fiscal year ended Sept. 30, 2012, compared with a net loss of $19.10 million during the prior year. Boomerang Systems' balance sheet at Sept. 30, 2012, showed $6.03 million in total assets, $21.28 million in total liabilities and a $15.25 million total stockholders' deficit. Bankruptcy Warning "Our operations may not generate sufficient cash to enable us to service our debt. If we were to fail to make any required payment under the notes and agreements governing our indebtedness or fail to comply with the covenants contained in the notes and agreements, we would be in default. Our debt holders would have the ability to require that we immediately pay all outstanding indebtedness. If the debt holders were to require immediate payment, we might not have sufficient assets to satisfy our obligations under the notes or our other indebtedness. In such event, we could be forced to seek protection under bankruptcy laws, which could have a material adverse effect on our existing contracts and our ability to procure new contracts as well as our ability to recruit and/or retain employees. Accordingly, a default could have a significant adverse effect on the market value and marketability of our common stock," the Company said in its annual report for the year ended Sept. 30, 2012. BROWN PUBLISHING: Trust Suit Againt Failed Buyer Goes to Trial -------------------------------------------------------------- Bankruptcy Judge Dorothy Eisenberg said a trial is required before she'd rule on a dispute as to who should keep a good faith deposit made as part of the sale of Brown Publishing Company. Judge Eisenberg denied the motion for summary judgment filed by The Brown Publishing Company Liquidating Trust, as successor in interest to the Reorganized Debtors, and the cross-motion for summary judgment filed by Brown Media Corporation, which was formed by the Debtors' insiders to act as stalking horse bidder. On May 25, 2012, the Trust commenced the adversary proceeding against BMC for breach of contract and sought a declaratory judgment that the Trust is entitled to retain the $765,000 deposit posted by BMC in connection with its bid to purchase the Debtors' assets. Judge Eisenberg said BMC breached the contract with the Debtors by failing to timely close on the sale by Aug. 20, 2010. The judge said there is no liquidated damages clause in the contract. However, whether the Debtors sustained actual damages is an issue of material fact that prohibits a determination on summary judgment as to which party is entitled to the good faith deposit. The asset purchase agreement provided for a stalking horse bid by BMC of a cash purchase price of $15.3 million plus additional consideration. The auction commenced July 19, 2010 and lasted into the early morning hours of July 20, 2010. With the exception of certain assets of the Debtors located in Van Wert, Ada and Putnam, Ohio that were sold to Delphos Herald, Inc., BMC was the successful bidder with respect to substantially all of the Debtors's remaining assets after making the highest and best offer for $22,400,000 in cash plus additional consideration. PNC Bank, N.A., a secured creditor of the Debtors, was the next successful bidder after BMC. The Court held hearings to approve the sale of assets to Delphos and BMC on July 22 and 29, 2010. BMC lost financing and failed to close on the sale. The insiders had obtained a commitment from Guggenheim Corporate Funding, LLC and/or one of its affiliates for financing. The Court approved the asset purchase agreements for the sale of the Debtors' assets to PNC's assignee, Ohio Community Media LLC, and to ISIS Ventures Partners LLC pursuant to orders dated Sept. 3, 2010. ISIS agreed to purchase the assets of one of the Debtors, Dan's Papers, for $1,750,000. PNC agreed to pay $21,750,000 for substantially all of the Debtors remaining assets. The combined purchase price was $23,500,000. The asset purchase agreements with Ohio Community Media and ISIS also contain language identical to Paragraph 41 of the August 11 Order. Closing on the sale to Ohio Community Media and ISIS occurred after the Court approved the asset purchase agreements. The case is The Brown Publishing Company Liquidating Trust, Plaintiff, v. Brown Media Corporation, Defendant, Adv. Proc. No. 12-8215-478. (Bankr. E.D.N.Y.). A copy of the Court's Jan. 22, 2013 Memorandum Decision and Order is available at http://is.gd/enMehnfrom Leagle.com. About Brown Publishing The Brown Publishing Company, Brown Media Holdings Company and their subsidiaries filed for Chapter 11 bankruptcy (Bankr. E.D.N.Y. Lead Case No. 10-73295) on April 30, 2010 and May 1, 2010. BPC estimated $10 million to $50 million in assets and debts in its Chapter 11 petition. Edward M. Fox, Esq., and Eric T. Moser, Esq., at K&L Gates LLP, serve as counsel for the Debtors. BPC is a privately held community news and information corporation, organized under the laws of the State of Ohio that, prior to the sale of its assets, had been one of the largest newspaper publishers in Ohio, and also operated publications in Illinois, South Carolina, Texas and Utah. On Sept. 3, 2010, the Debtors completed the sale of substantially all of their assets. Brown Publishing sold most of its assets to Ohio Community Media LLC, which was formed by the Company's lenders, for about $21.8 million. Brown Publishing's New York newspaper group, Dan's Papers Inc., was sold to Dan's Papers Holdings LLC for about $1.8 million. On June 16, 2011, the Court entered an order confirming the Debtors' chapter 11 plan which provided that any remaining assets of the Debtors' bankruptcy estate that were not sold pursuant to the Auction Sale, including all claims and causes of action, would vest in a trust. CAMTECH PRECISION: Asks for Final Decree Closing Case ----------------------------------------------------- Camtech Precision Manufacturing, Inc., filed with the U.S. Bankruptcy Court for the Southern District of Florida a final report and motion for final decree closing their Chapter 11 cases. The Debtors also request that the Court enter a final decree closing the case with leave to reinstate if the Debtor or any other party-in-interest defaults under the terms of the Plan. The Debtors note that on Nov. 14, 2012, the Court confirmed their Plan, the Plan is substantially consummated, and their estate is fully administered. About Camtech Precision Jupiter, Florida-based Camtech Precision Manufacturing, Inc., Avstar Fuel Systems, Inc., and R & J National Enterprises Inc. filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case Nos. 10-22760, 10-22762 and 10-22762) on May 10, 2010. Avstar, founded in 2007, designs, manufactures and overhauls carburetors and fuel injection systems for the aviation industry. Avstar is the holder of Federal Aviation Administration Parts Manufacturer Approvals for general aviation fuel systems. Avstar generates sales primarily from new product sales and overhauls of carburetors and servos for the general aviation industry. Bradley S. Shraiberg, Esq., at Shraiberg, Ferrara & Landau, P.A., in Boca Raton, Florida, serves as counsel to the Debtors. Carlos E. Sardi, Esq., and Glenn D. Moses, Esq., at Genovese Joblove Battista P.A., in Miami, Florida, represent the Official Committee of Unsecured Creditors. In its schedules, Camtech disclosed assets of $10.98 million and debts of $14.63 million. CASCADE BANCORP: COO Retires; Board Member Won't Seek Re-Election ----------------------------------------------------------------- Michael Delvin, executive vice president and chief operating officer of Cascade Bancorp and of its wholly owned subsidiary Bank of the Cascades, gave notice of his resignation, which will be effective March 31, 2013. Mr. Delvin is retiring. Also on Jan. 16, 2013, Judith Johansen, who serves on the board of directors of Bancorp and the Bank, gave notice to Bancorp and the Bank that she will not stand for re-election at the annual meeting of shareholders to be held in 2013. Ms. Johansen's decision is not due to a disagreement with Bancorp on any matter relating to Bancorp's or the Bank's operations, policies or practices. About Cascade Bancorp Bend, Ore.-based Cascade Bancorp (Nasdaq: CACB) through its wholly-owned subsidiary, Bank of the Cascades, offers full-service community banking through 32 branches in Central Oregon, Southern Oregon, Portland/Salem Oregon and Boise/Treasure Valley Idaho. Cascade Bancorp has no significant assets or operations other than the Bank. Weiss Ratings has assigned its E- rating to Bend, Ore.-based Bank of The Cascades. The rating company says that the institution currently demonstrates what it considers to be significant weaknesses and has also failed some of the basic tests it uses to identify fiscal stability. "Even in a favorable economic environment," Weiss says, "it is our opinion that depositors or creditors could incur significant risks." Cascade reported a net loss of $47.27 million in 2011, a net loss of $13.65 million in 2010, and a net loss of $114.83 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $1.29 billion in total assets, $1.15 billion in total liabilities and $139.27 million in total stockholders' equity. CASTLEVIEW LLC: Court Dismisses Chapter 11 Case ----------------------------------------------- The U.S. Bankruptcy Court for the District of Colorado has granted the motion of HB ALP Family, LLLP and CV2011, LLC, for the dismissal of the Chapter 11 case of Castleview, LLC. As reported in the TCR on Sept. 7, 2012, HB ALP Family said that Castleview was formed in 2000 by Michael Blumenthal and Harvey B. Alpert for the purpose of acquiring and developing real property located in Douglas County, Colorado. HB ALP is a company in which Mr. Alpert owns a 50% interest. HB ALP asserted that: 1. Blumenthal has no authority to file a Chapter 11 petition on behalf of the Debtor; and 2. the petition was filed in bad faith. About Castleview Castleview, LLC, filed a Chapter 11 petition (Bankr. D. Colo. Case No. 12-23954) on July 2, 2012, with a plan that intends to pay creditors in full. The Debtor disclosed $14.53 million in assets and $3.21 million in liabilities in its schedules. The Debtor owns a 252-acre residential development site located in Southeastern Castle Rock, Colorado, which property includes 245 residential lots. The property is worth $10.2 million and secures a $3.21 million debt. The Debtor is also entitled to bond proceeds from the Castleview Metropolitan District appraised at $6,248,724. The Debtor has tapped Weinman & Associates, P.C, as bankruptcy counsel, and Allen & Vellone, P.C as special counsel. The U.S. Trustee was unable to form an official committee of unsecured creditors because an insufficient number of persons holding unsecured claims against the Debtor have expressed interest in serving on a committee. The U.S. Trustee reserves the right to appoint such a committee if interest developed among the creditors. CENTRAL EUROPEAN: Names Russian Alcohol Unit's R. Lee as New CFO ---------------------------------------------------------------- Central European Distribution Corporation announced that Ryan Lee, age 44, was appointed Chief Financial Officer of CEDC by the CEDC Board of Directors. Prior to his appointment, Mr. Lee served as Chief Financial Officer of Russian Alcohol Group, a CEDC subsidiary, from April 2012. Mr. Lee has over 23 years of international work experience including 13 years in Russia, 5 years in Switzerland, and 2 years in each of the UK and the Netherlands. From November 2008 to March 2012, Mr. Lee worked for Eldorado as Vice President Finance. From November 1999 to November 2008, Mr. Lee worked for Japan Tobacco International, Geneva, as Vice President Finance, Business Service Centres & Integration, Vice President Finance, Financial Planning & Analysis, and Vice President Corporate Tax, and for Japan Tobacco International, Russia as Chief Financial Officer, Vice President Finance and Financial Controller. From August 1989 to October 1999, Mr. Lee held accounting, finance and commercial positions at Unilever PLC and its group subsidiaries. Mr. Lee graduated in 1990 from the University of Wales Cardiff with a BA joint honors in Law and Italian, and has been a Chartered Accountant since 1992. CEDC also announced on Jan. 22, 2013, that Bartosz Kolacinski agreed to resume his position as Deputy Chief Financial Officer of CEDC. Mr. Kolacinski had been serving as Interim Chief Financial Officer of CEDC since September 2012. About CEDC Mt. Laurel, New Jersey-based Central European Distribution Corporation is one of the world's largest vodka producers and Central and Eastern Europe's largest integrated spirit beverages business with its primary operations in Poland, Russia and Hungary. Ernst & Young Audit sp. z.o.o., in Warsaw, Poland, expressed substantial doubt about Central European'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 certain of the Company's credit and factoring facilities are coming due in 2012 and will need to be renewed to manage its working capital needs. The Company's balance sheet at Sept. 30, 2012, showed $1.98 billion in total assets, $1.73 billion in total liabilities, $29.44 million in temporary equity, and $210.78 million in total stockholders' equity. Liquidity The Company's Convertible Senior Notes are due on March 15, 2013. The Company has said its current cash on hand, estimated cash from operations and available credit facilities will not be sufficient to make the repayment of principal on the Convertible Notes and, unless the transaction with Russian Standard Corporation is completed the Company may default on them. The Company's cash flow forecasts include the assumption that certain credit and factoring facilities coming due in 2012 would be renewed to manage working capital needs. Moreover, the Company had a net loss and significant impairment charges in 2011 and current liabilities exceed current assets at June 30, 2012. These conditions, the Company said, raise substantial doubt about its ability to continue as a going concern. * * * As reported by the TCR on Aug. 10, 2012, Standard & Poor's Ratings Services kept on CreditWatch with negative implications its 'CCC+' long-term corporate credit rating on U.S.-based Central European Distribution Corp. (CEDC), the parent company of Poland-based vodka manufacturer CEDC International sp. z o.o. "The CreditWatch status reflects our view that uncertainties remain related to CEDC's ongoing accounting review and that CEDC's liquidity could further and substantially weaken if there was a breach of covenants which could lead to the acceleration of the payment of the 2016 notes, upon receipt of a written notice of 25% or more of the noteholders," S&P said. As reported by the TCR on Jan. 16, 2013, Moody's Investors Service has downgraded the corporate family rating (CFR) and probability of default rating (PDR) of Central European Distribution Corporation (CEDC) to Caa3 from Caa2. "The downgrade follows CEDC announcement on the 28 of December that it had agreed with Russian Standard a revised transaction to repay its $310 million of convertible notes due March 2013 which, in Moody's view, has increased the risk of potential loss for existing bondholders", says Paolo Leschiutta, a Moody's Vice President - Senior Credit Officer and lead analyst for CEDC. CEREPLAST INC: Inks Forbearance Agreement with Sr. Noteholders -------------------------------------------------------------- Cereplast, Inc., entered into a payment agreement dated Jan. 15, 2013, with Magna Group, LLC, and the holders of the Company's 7% Convertible Senior Subordinated Notes issued by the Company in the aggregate principal face amount of $12,500,000 pursuant to the Indenture dated as of May 24, 2011, to provide for payment of interest on the Notes which was due on June 1, 2012, and Dec. 1, 2012. The payment agreement also provides for payment of interest which will be due on June 1, 2013. Payments in the agreement will be made by Magna to the Holders in tranches. In connection with the execution of the payment agreement, the holders waived the event of default and agreed to forbear from exercising their rights and remedies under the Indenture with respect to the Company's failure to make interest payments that were due on June 1, 2012, and Dec. 1, 2012. About Cereplast El Segundo, Calif.-based Cereplast, Inc., has developed and is commercializing proprietary bio-based resins through two complementary product families: Cereplast Compostables(R) resins which are compostable, renewable, ecologically sound substitutes for petroleum-based plastics, and Cereplast Sustainables(TM) resins (including the Cereplast Hybrid Resins product line), which replaces up to 90% of the petroleum-based content of traditional plastics with materials from renewable resources. The Company's balance sheet at Sept. 30, 2012, showed $25.4 million in total assets, $22.1 million in total liabilities, and stockholders' equity of $3.3 million. Bankruptcy Warning "We have incurred a net loss of $16.3 million for the nine months ended September 30, 2012, and $14.0 million for the year ended December 31, 2011, and have an accumulated deficit of $73.2 million as of September 30, 2012. Based on our operating plan, our existing working capital will not be sufficient to meet the cash requirements to fund our planned operating expenses, capital expenditures and working capital requirements through December 31, 2012 without additional sources of cash. In order to provide and preserve the necessary working capital to operate, we have successfully completed the following transactions in 2012: * Entered into an Exchange Agreement with Magna Group LLC pursuant to which we agreed to issue to Magna convertible notes, in the aggregate principal amount of up to $4.6 million, in exchange for repayment of our Term Loan with Compass Horizon Funding Company, LLC. * Obtained a Forbearance Agreement on our semi-annual coupon payment due on June 1, 2012 with certain holders of our Senior Subordinated Notes to defer payment until December 1, 2012. * Reduced future interest payments through executing an Exchange Agreement for $2.5 million with certain holders of our Senior Subordinated Notes for conversion of their Notes and accrued interest into shares at an exchange rate of one share of our common stock for each $1.00 amount of the Note and accrued interest. * Issued 6,375,000 shares of our common stock to an institutional investor in settlement of approximately $1.3 million of our outstanding accounts payable balances. * Completed a Registered Direct offering to issue 1,000,000 shares of common stock at $0.50 per share for gross proceeds of $0.5 million. * Obtained unsecured short-term convertible debt financing of $0.6 million with additional availability of approximately $0.6 million at the lender's sole discretion. * Returned unused raw materials to our suppliers in exchange for refunds net of restocking charges of approximately $0.3 million. Our plan to address the shortfall of working capital is to generate additional financing through a combination of sale of our equity securities, additional funding from our new short-term convertible debt financings, incremental product sales into new markets with advance payment terms and collection of outstanding past due receivables. We are confident that we will be able to deliver on our plans, however, there are no assurances that we will be able to obtain any sources of financing on acceptable terms, or at all. If we cannot obtain sufficient additional financing in the short- term, we may be forced to curtail or cease operations or file for bankruptcy," the Company said in its quarterly report for the period ended Sept. 30, 2012. CHARLIE N MCGLAMRY: Feb. 12 Plan Confirmation Hearing to Proceed ---------------------------------------------------------------- The Hon. James P. Smith of the U.S. Bankruptcy Court for the Middle District of Georgia denied Synovus Bank's motion continuing the Feb. 12 and 13 hearings to consider confirmation of Charlie N. McGlamry, et al.'s Chapter 11 Plan. In this relation, the Court extended until Feb. 8, Synovus Bank's time to file an objection to confirmation of the Debtor's Plan. As reported in the TCR on Dec. 5, 2012, Mr. McGlamry's Plan, as amended, provides for the creation of a liquidating trust and appointment of a plan trustee to liquidate the remaining assets and distribute the proceeds to creditors. The Debtor has selected Ward Stone, Esq., as the plan trustee. The Debtor owes Synovus Bank on a $5.559 million loan secured by 74 acres of undeveloped commercial property at the intersection of Russell Parkway and Corder Road in Houston County, Georgia. The Debtor will convey his right to the property in full satisfaction of the secured claim. The Debtor has an unsecured debt of $4.5 million on an obligation relating to his interest in a non-Debtor entity known as Oaky Timberlands, LLC. In addition, the Debtor owes $20 million to unsecured creditors on account of a personal guarantee of the indebtedness of his affiliated companies. The unsecured creditors will share pro rata with Synovus in the proceeds from the liquidating trust. A copy of the First Amended Plan Outline is available for free at http://bankrupt.com/misc/CHARLIE_N_MCGLAMRY_ds_1amended.pdf About Charlie N. McGlamry Centerville, Georgia-based real estate developer Charlie N. McGlamry filed a petition for Chapter 11 protection, along with his 14 companies, in Macon, Georgia on May 9, 2012. Over the past 44 years, Mr. McGlamry has managed to successfully develop numerous real estate developments in and around Houston County, Georgia. Mr. McGlamry continues to operate his real estate development business through sole proprietorship McGlamry Properties -- http://www.mcglamryproperties.com-- and USA Land Development Inc. Mr. McGlamry individually owns, through his sole proprietorship, approximately, 74 acres of undeveloped commercial property at the intersection of Russell Parkway and Corder Road in Houston County, Georgia. Mr. McGlamry established a number of single member limited liability companies and sole shareholder corporations to own and develop specific tracts of land. Mr. McGlamry and his affiliated companies sought joint administration of their Chapter 11 cases and have Mr. McGlamry's as the lead case (Bankr. M.D. Ga. Case No. 12-51197). Judge James P. Smith oversees the case. Cohen Pollock Merlin & Small, PC, serves as the Debtors' Chapter 11 counsel. Nichols, Cauley & Associates, LLC, serves as their accountant. Mr. McGlamry, as sole shareholder or member, signed Chapter 11 petitions for USA Land Development (Case No. 12-51198); Barrington Hall Development Corp. (12-51199); Bear Branch LLC; By- Pass/Courthouse LLC (12-51201); Chinaberry Place, LLC (12-51202); Eagle Springs LLC (12-51203); Elmdale Development, LLC (12-51204); Gurr/Kings Chapel Road, LLC (12-51205); Jaros Development LLC (12-51206); Lake Joy Development, LLC (12-51207); Old Hawkinsville Road, LLC (12-51208); South Houston Development, LLC (12-51209); The Villages at Nunn Farms, LLC (12-51210); and Houston-Peach Investments LLC (12-51212). Mr. McGlamry disclosed $19,745,079 in assets and $92,637,998 in liabilities as of the Chapter 11 filing. The Debtors tapped Cohen Pollock Merlin & Small, PC, as bankruptcy counsel. CHEF SOLUTIONS: Feb. 5 Hearing on Closing of Chapter 11 Case ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware will convene a hearing on Feb. 5, 2013, at 4 p.m., to consider Food Processing Liquidation Holdings, LLC's request for entry of a final decree closing the Debtor's Chapter 11 case. Objections, if any, are due Jan. 25, at 4 p.m. According to the Debtor, the Court confirmed and approved the Joint Plan of Liquidation dated Feb. 13, 2012. The effective date of the Plan occurred on May 7, 2012. On July 11, 2012, the Court entered an order closing each of the Chapter 11 cases with the exception of the Debtor's case. About Chef Solutions Chef Solutions, through subsidiary Orval Kent Food, was the second largest manufacturer in North America of fresh prepared foods for retail, food service and commercial channels. Chef Solutions and its affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 11-13139) on Oct. 4, 2011. Debtor Orval Kent Food Company disclosed $82,902,336 in assets and $126,085,311 in liabilities in its schedules. The Debtor was renamed to Food Processing Liquidation Holdings LLC, following the sale of most of the assets to RMJV, L.P., a joint venture between Mistral Capital Management LLC and Reser's Fine Foods Inc. In addition to debt assumption, the price included $35.9 million in cash to pay off secured debt plus a $25.3 million credit bid. The Debtors entered into an asset purchase agreement with RMJV on the Petition Date. On Nov. 15, 2011, the Court approved the APA and the sale, and on Nov. 21, the sale closed. Judge Kevin Gross presides over the case. Lawyers at Richards, Layton & Finger, P.A., serve as the Debtors' bankruptcy counsel. Donlin Recano is the claims and notice agent. Piper Jaffray & Co. has been hired as investment banker. PricewaterhouseCoopers serves as financial advisor. Lowenstein Sandler PC and Polsinelli Shughart serve as counsel to the creditors' committee appointed in the case. Mesirow Financial Consulting, LLC, is the financial advisor. CLUB AT SHENANDOAH: Wants Access to Cash Collateral Until Feb. 28 ----------------------------------------------------------------- The Club At Shenandoah Springs Village, Inc., asks the U.S. Bankruptcy Court for the Central District of California to enter interim and final orders authorizing it to use cash collateral of General Electric Capital Corporation, to pay ordinary and necessary expenses, until Feb. 28, 2013. As adequate protection, the Debtor will grant GE replacement liens in the Debtor's postpetition assets and proceeds. In May 2007, in connection with the Debtor's acquisition of a real property located in Thousand Palms, California, the Debtor obtained from GE the principal amount of $15,000,000 under a note secured by the property. The property is improved with a golf course. In its objection, GE says it's owed $11.2 million under the note as of Dec. 1, 2012. GE asks the Court to limit the Debtor's initial use of its cash collateral to 30 days and prohibit the Debtor from using cash collateral to pay attorneys' fees or fees associated with the Office of the United States Trustee, citing: 1. The Debtor has failed to show that GE will be adequately protected for the next three months. 2. The Debtor seeks permission to pay legal fees (totaling $75,000) with a single line item in its proposed budget. The Club At Shenandoah Springs Village Inc. owns The Club At Shenandoah Springs Village, a golf and leisure resort in Thousand Palms, a desert region of central California. It filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 12-36723) on Dec. 3, 2012. The Debtor estimated both assets and liabilities of between $10 million and $50 million. Judge Mark D. Houle presides over thee case. Daniel A. Lev, Esq., at Sulmeyerkupetz, represents the Debtor. CLUB AT SHENANDOAH: Hiring SulmeyerKupetz as Counsel ---------------------------------------------------- The Club At Shenandoah Springs Village Inc. asks the U.S. Bankruptcy Court for the Central District of California for authorization to employ SulmeyerKupetz as its general bankruptcy counsel effective as of the Petition Date. SK will provide legal services that will be required to prosecute its Chapter 11 case. The attorneys of the firm currently expected to principally responsible for this engagement and their respective hourly rates effective as of Jan. 1, 2012, are: Daniel A. Lev., Esq. $575 Jeffrey M. Pomerance, Esq. $500 Steven M. Werth, Esq. $460 To the best of the Debtor's knowledge, the firm and its partners, of counsel, and associates are "disinterested persons" as that term is defined and used in Sections 101(14) and 327 of the Bankruptcy Code. The Club At Shenandoah Springs Village Inc. owns The Club At Shenandoah Springs Village, a golf and leisure resort in Thousand Palms, a desert region of central California. It filed for Chapter 11 protection (Bankr. C.D. Calif. Case No. 12-36723) on Dec. 3, 2012. The Debtor estimated both assets and liabilities of between $10 million and $50 million. Judge Mark D. Houle presides over thee case. COLLEGE OF NEW ROCHELLE: Moody's Cuts Rating on Bonds to 'Ba1' -------------------------------------------------------------- Moody's Investors Service has downgraded the College of New Rochelle's (CNR) rating to Ba1 from Baa3 on the Series 1999 and 2008 bonds. The rating outlook is negative. Summary Rating Rationale The downgrade of the College of New Rochelle's rating to Ba1 with a negative outlook is based on persistent enrollment declines and a challenged student market position, steep enrollment decline in fall 2012, weakening operating performance and thin debt service coverage. The rating also incorporates the college's high leverage, extremely thin unrestricted liquidity, insufficient liquidity to cover its variable rate demand debt, heavy use of operating lines and a modest balance sheet. Given the significant challenges faced by the college, the Ba1 rating is based Moody's expectation that the college's relatively new president and leadership team will stabilize enrollment and improve the college's frail financial position longer term. CHALLENGES * Very low unrestricted monthly liquidity of $12.7 million providing just 25.6% coverage of demand debt and just 78 monthly days of cash on hand. Excluding $10.5 million of operating lines, monthly liquidity would be only $2.2 million. * Debt structure risks, particularly in light of thin liquidity, with a high amount of variable rate demand debt (before swaps), a letter of credit (LOC) that contains financial covenants and exposes the college to remarketing and liquidity facility renewal risk. The LOC expires on August 6, 2013 and inability to secure a liquidity facility or a failed remarketing could result in a more rapid deterioration of CNR's credit profile. * Steep enrollment declines evidenced by a 21% decline in full- time equivalent (FTE) enrollment from fall 2008 to 3,649 FTE students in fall 2012. The 5.5% total enrollment decline in fall 2012 from the prior fall was concentrated in the college's adult education and workforce learning school, which constitutes the college's largest school by credit hours and revenue. * High dependence on student charges (88% in FY 2012), coupled with significant reliance on state and federal student aid programs, which are increasingly vulnerable to cuts and changes in eligibility requirements. * Pressure on net tuition revenue and growing expenses have led to weaker operating performance and debt service coverage. In FY 2012, the operating cash flow margin was thin at 4.7%, leading to just 0.66 times debt service coverage in FY 2012. * Low expendable financial resource coverage of debt and operations. Expendable financial resources of $17.0 million in FY 2012 provided thin coverage to debt and operations of 0.25 times and 0.28 times, respectively. STRENGTHS * Continued growth in net tuition per student. While net tuition per student is modest, it has grown 42% over the past five years to $12,062 in FY 2012 from FY 2008. Management projects another year of growth in FY 2013 based on current enrollment. * Implementation of a strategic plan by a relatively new senior leadership team, recent realignment of enrollment and student services departments, and addition of new resources to rebuild enrollment across the college and increase fundraising. * Flexible expense base allows the college to adapt to changing economic and student market conditions, as most of the faculty in the School of New Resources (the college's largest school) and the Graduate School hold adjunct appointments, which allows for expansion and contraction of faculty. * No additional near-term borrowing plans. OUTLOOK The negative outlook reflects Moody's expectations that the college will continue to face a highly competitive student market and challenging market position, as well as continued reliance on bank lines and thin liquidity that could pressure the rating in the next 12-18 months should enrollment continue to decline or cash flow and debt service coverage or liquid resources weaken. The negative outlook also reflects debt structure risks, including renewal or replacement of the letter of credit expiring on August 6, 2013 and incorporates the uncertainty about the impact of federal budget negotiations on federal funding given the college's high reliance on federal financial aid. WHAT COULD CHANGE THE RATING UP Unlikely given the negative outlook. Any upgrade would be driven by substantial growth in unrestricted liquidity and financial resources; stabilization of enrollment; improved operating performance and stronger debt service coverage; sufficient liquidity to fully cover variable rate demand debt WHAT COULD CHANGE THE RATING DOWN Inability to renew or replace letter of credit or more onerous covenants in bank documents; violation of covenants or acceleration of debt; inability to stabilize enrollment or right size the expense commensurate with enrollment declines; declines in net tuition per student; weakening of operating performance or cash flow and debt service coverage; erosion or encumbrance of financial resources unrestricted liquidity; additional debt issuance without commensurate growth in financial resources 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. COMMUNITY FINANCIAL: Has 19.6-Mil. Shares Resale Prospectus ----------------------------------------------------------- Community Financial Shares, Inc., filed a Form S-1 registration statement relating to the offer and sale of up to 19,684,700 shares of the Company's common stock by SBAV LP, Ithan Creek Investors USB, LLC, Fullerton Capital Partners LP, et al. A copy of the prospectus is available for free at http://is.gd/DRlFk6 About Community Financial Glen Ellyn, Illinois-based Community Financial Shares, Inc., is a registered bank holding company. The operations of the Company and its banking subsidiary consist primarily of those financial activities common to the commercial banking industry. All of the operating income of the Company is attributable to its wholly- owned banking subsidiary, Community Bank-Wheaton/Glen Ellyn. BKD, LLP, in Indianapolis, Indiana, issued a going concern qualification on the consolidated financial statements for the year ended Dec. 31, 2011. The independent auditors noted that the Company has suffered recurring losses from operations and is undercapitalized. The Company reported a net loss of $11.01 million on net interest income (before provision for loan losses) of $10.77 million in 2011, compared with a net loss of $4.57 million on net interest income (before provision for loan losses) of $10.40 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $334.17 million in total assets, $328.69 million in total liabilities and $5.48 million in total shareholders' equity. CONDOR DEVELOPMENT: Relief of Stay Hearing Continued Until Feb. 8 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the western District of Washington continued until Feb. 8, 2013, at 9:30 a.m., the hearing to consider EastWest Bank's motion for relief from the automatic stay in the Chapter 11 case of Condor Development LLC. On Nov. 15, 2005, Condor executed a promissory note in favor of Washington First International Bank in the principal amount of $865,000. EastWest is a successor-in-interest to the note. The Note is secured by Condor's interest in real property located at 19266 28th Ave South, SeaTac, Washington. Condor is in default under the Note for failure to pay all outstanding indebtedness under the Note by March 31, 2012. The debt as of the petition date totals $785,957.39. On Jan. 29, 2009, Condor executed a promissory note in favor of WFIB in the principal amount of $6,850,000. The amount of debt owed to the Lender under the Second Note as of the petition date is $8,275,039. The Second Note is secured by the Debtors' interest in the Comfort Inn property located at 19260 28th Ave South and 19333 International Boulevard, also in SeaTac. About Condor Development Condor Development LLC, aka Ciara Inn and Condor Management Group, operates the Comfort Inn Suites, a hotel located at SeaTac, Washington. Condor Development filed a Chapter 11 petition (Bankr. W.D. Wash. Case No. 12-13287) on March 30, 2012, in Seattle. In its schedules, the Debtor disclosed $16.4 million in total assets and $9.11 million in total liabilities. Affiliate Seattle Group also filed for Chapter 11 protection (Bankr. Case No. 12-13263) on March 30, 2012. The Debtor disclosed $15,501,088 in assets and $10,409,935 in liabilities as of the Chapter 11 filing. Vortman & Feinstein and Larry B. Feinstein initially represented the Debtors as counsel. They later withdrew from the case and were replaced by Lane Powell PC. CORD BLOOD: John M. Fife, St. George Have 9.9% Equity Stake ----------------------------------------------------------- St. George Investments, LLC, Fife Trading, Inc., and John M. Fife filed with the U.S. Securities and Exchange Commission an amended Schedule 13G. Mr. Fife is the sole member of St. George and the president and sole shareholder of Fife Trading, Inc. St. George had rights to convert a note into, and to exercise a warrant to purchase, an aggregate number of shares of the Company's common stock which, except for a contractual 9.99% cap on the amount of outstanding shares of the Company's common stock that St. George may own, would exceed the cap. Thus, the number of shares of the Company's common stock beneficially owned by St. George as of Jan. 22, 2013, was 24,749,937 shares, which is 9.99% of the 249,999,364 shares that were outstanding on that date (as reported in the Company's Form 10-Q filed on Nov. 14, 2012). The reporting persons previously reported beneficial ownership of 6,808,881 common shares as of March 10, 2011. A copy of the amended filing is available for free at: http://is.gd/Y1lfRY About Cord Blood America Based in Las Vegas, Nevada, Cord Blood America, Inc., is primarily a holding company whose subsidiaries include Cord Partners, Inc., CorCell Co. Inc., CorCell Ltd.; CBA Professional Services, Inc. D/B/A BodyCells, Inc.; CBA Properties, Inc.; and Career Channel Inc, D/B/A Rainmakers International. Cord specializes in providing private cord blood stem cell preservation services to families. BodyCells is a developmental stage company and intends to be in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy. Properties was formed to hold the corporate trademarks and other intellectual property of CBAI. Rain specializes in creating direct response television and radio advertising campaigns, including media placement and commercial production. After auditing the 2011 results, Rose, Snyder & Jacobs, LLP, in Encino, California, expressed substantial doubt substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has sustained recurring operating losses, continues to consume cash in operating activities, and has insufficient working capital and an accumulated deficit at Dec. 31, 2011. Cord Blood reported a net loss attributable to the Company of $5.97 million in 2011, compared with a net loss attributable to the Company of $8.09 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $7.31 million in total assets, $6 million in total liabilities and $1.31 million in total stockholders' equity. CSD LLC: Wayne Newton Wants to Float Plan for Bankrupt Developer ---------------------------------------------------------------- Eric Hornbeck of BankruptcyLaw360 reported that singer Wayne Newton and his wife said Tuesday that they should get a chance to propose a reorganization plan for a developer who bought his Las Vegas mansion for $20 million with hopes of converting it into a museum, arguing the developer admits it will liquidate. CSD LLC, which filed for bankruptcy in October after it became bogged down in litigation with the entertainer and ran into financial troubles, shouldn't get more time to file a reorganization plan because it has no viable options, Newton said, according to the report. About CSD LLC Las Vegas, Nev.-based CSD, LLC, filed a Chapter 11 petition (Bankr. D. Nev. Case No. 12-21668) on Oct. 12, 2012, estimating $50 million to $100 million in assets and $10 million to $50 million in debts. The petition was signed by Steven K. Kennedy, manager of CSD Management, LLC, manager. The Debtor owns 37.82 acres of land, seven houses, and an equestrian facility, all located at 6629 S. Pecos Road, Las Vegas, Nevada. The Debtor purchased the property from Mr. Wayne Newton and his wife, Kathleen, for $19.5 million to develop and operate a museum/tourist attraction honoring the life and career of Wayne Newton. Situated on the purchased property is the current home of the Newtons, known as "Casa de Shenandoah", which was to be used to showcase Wayne Newton's memorabilia. The museum remains unopened. DLH, LLC, which holds a 70% interest in the Debtor, contributed nearly $60 million towards development of the museum. DLH is a Nevada limited liability company, and its members are Lacy Harber and Dorothy Harber. Plans called for contributing $2 million toward the construction of a new home for Mr. Newton on the acreage. The new home hasn't been built, so Mr. Newton still lives in the existing home, paying minimal rent. While the Debtor has made substantial expenditures towards the development of the Newton Museum, the Debtor and the Newtons have been involved in certain disputes regarding the development of the museum. The Debtor in May 2012 filed a lawsuit in Nevada state court for fraud, civil conspiracy, and breach. The Newtons filed counterclaims. Because of the deteriorating relationship of the parties, it appears that it is no longer feasible for the parties to move forward with the development of the museum. On Aug. 9, 2012, the Debtor's committee members held an emergency meeting and voted to dissolve the Debtor. Though the Debtor has sought approval in the state court proceedings to dissolve, that matter is not scheduled to be heard until May 2013. Because the Debtor is out of money and options, and because the Debtor's prepetition secured lender, Neva Lane Acceptance, LLC, is unwilling to lend any additional funds to the Debtor on a prepetition basis, the majority of the committee members voted in favor of the bankruptcy filing. Although the Debtor is out of cash, it claims that it has substantial equity in its property. The Debtor has decided that a sale of the Debtor's property pursuant to Section 363 of the Bankruptcy Code, followed by the filing of a plan of liquidation, is the Debtor's best option for maximizing the value of the property and maximizing the return to the Debtor's creditors and interest holders. James D. Greene, Esq., at Greene Infuso, LLP, in Las Vegas, represents the Debtor. The Debtor's CRO is Odyssey Capital Group, LLC. DEWEY & LEBOEUF: Taps Adler Law as Collection Attorneys ------------------------------------------------------- Dewey & Leboeuf LLP asks the U.S. Bankruptcy Court for the Southern District of New York for permission to employ Adler Law Firm as collection attorneys, to assist with the collection of accounts receivable, primarily in California and Washington D.C. Adler will render collection services to the Debtor, which may include, but are not limited to: a) investigation of each claim; b) determination of responsible or additional parties; c) provisional selection, vetting, hiring (subject to Bankruptcy Court approval) and supervision of out of area counsel; d) preparation and filing of required notices, pleadings and papers; e) application for provisional remedies when appropriate. The Debtor proposes to pay Adler: * 12% of the gross recovery in the event the recovery is solely the result of sending a demand letter and the claim is $150,000 or less; * 10% of the gross recovery in the event the recovery is solely the result of sending a demand letter and the claim is more than $150,000, but less than $500,000; and * 5% of the gross recovery in the event the recovery is solely the result of sending a demand letter and the claim is more than $500,000. For all non-routine matters, the Debtor proposes to pay Adler 35% of the gross recovery, plus reimbursement of Adler's costs and expenses. To the best of the Debtor's knowledge, Adler does not hold or represent any interest adverse to the Debtor or its estate with respect to the matters as to which Adler is to be employed. About Dewey & LeBoeuf Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the wind-down of its operations. The firm had struggled with high debt and partner defections. Dewey disclosed debt of $245 million and assets of $193 million in its chapter 11 filing late evening on May 29, 2012. Dewey & LeBoeuf LLP operated as a prestigious, New York City- based, law firm that traced its roots to the 2007 merger of Dewey Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird -- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in 1929. In recent years, more than 1,400 lawyers worked at the firm in numerous domestic and foreign offices. At its peak, Dewey employed about 2,000 people with 1,300 lawyers in 25 offices across the globe. When it filed for bankruptcy, only 150 employees were left to complete the wind-down of the business. Dewey's offices in Hong Kong and Beijing are being wound down. The partners of the separate partnership in England are in process of winding down the business in London and Paris, and administration proceedings in England were commenced May 28. All lawyers in the Madrid and Brussels offices have departed. Nearly all of the lawyers and staff of the Frankfurt office have departed, and the remaining personnel are preparing for the closure. The firm's office in Sao Paulo, Brazil, is being prepared for closure and the liquidation of the firm's local affiliate. The partners of the firm in the Johannesburg office, South Africa, are planning to wind down the practice. The firm's ownership interest in its practice in Warsaw, Poland, was sold to the firm of Greenberg Traurig PA on May 11 for $6 million. The Pension benefit Guaranty Corp. took $2 million of the proceeds as part of a settlement. Judge Martin Glenn oversees the case. Albert Togut, Esq., at Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The petition was signed by Jonathan A. Mitchell, chief restructuring officer. JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the lenders under the Revolver Agreement, hired Kramer Levin Naftalis & Frankel LLP. JPMorgan, as Collateral Agent for the Revolver Lenders and the Noteholders, hired FTI Consulting and Gulf Atlantic Capital, as financial advisors. The Noteholders hired Bingham McCutchen LLP as counsel. The U.S. Trustee formed two committees -- one to represent unsecured creditors and the second to represent former Dewey partners. The creditors committee hired Brown Rudnick LLP led by Edward S. Weisfelner, Esq., as counsel. The Former Partners hired Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel. Dewey filed a Chapter 11 Plan of Liquidation and an accompanying Disclosure Statement on Nov. 21, 2012. It filed amended plan documents on Dec. 31, in an attempt to address objections lodged by various parties. A second iteration was filed Jan. 7, 2013. The plan is based on a proposed settlement between secured lenders and Dewey's official unsecured creditors' committee. It also incorporates a settlement approved by the bankruptcy court in October where 440 former partners will receive releases in return for $71.5 million in contributions. DEWEY & LEBOEUF: Taps Yoon & Kim as New York Collection Counsel --------------------------------------------------------------- Dewey & Leboeuf LLP asks the U.S. Bankruptcy Court for the Southern District of New York for permission to employ Yoon & Kim LLP as special collections counsel to prosecute past due receivables relating to the collection of A/R, primarily in New York, on a contingency fee basis. The Debtor says that approximately 78% of outstanding A/R is owed by former clients of the Debtor's former offices located in New York. Y&K will render professional services to the Debtor, which may include, but are not limited to: -- investigation of a claim; -- determination of responsible or additional parties; -- preparation and filing of required notices, pleadings and papers; -- application for provisional remedies when appropriate; -- prosecution of a claim to judgment; and -- negotiation with opponent regarding settlement. The Debtor proposes to pay Y&K: * For matters with an outstanding legal fee owed to the Debtor in amount equal to or less than $100,000: (a) 15% of the gross recovery for each matter resolved prior to the filing or service of any initial litigation, arbitration or mediation document; (b) 22.5% of the gross recovery for each matter resolved subsequent to the filing or service of any initial litigation, arbitration or mediation document, including but not limited to the service of a "Notice to Arbitrate: under Part 137 of the Rules of the Chief Administrator, the filing of a Summons and Complaint, and the filing of Claim of Arbitration, but prior to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading; (c) 32.5% of the gross recovery for each matter resolved subsequent to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading, including but not limited to the filing by the Former Client of a "Client Request for Fee Arbitration" under Part 137 of the Rules of the Chief Administrator, the filing of an Answer or Motion, and the filing of a Response to a Claim for Arbitration; (d) 32.5% of the gross recovery of a matter resolved through default judgment as a result of a Former Client's default in any litigation or arbitration matter. * For matters with an outstanding legal fee owed to the Debtor in an amount greater than $100,000 and equal to or less than $500,000: (1) 12.5% of the gross recovery for each matter resolved prior to the filing or service of any initial litigation, arbitration or mediation document; (2) 20% of the gross recovery for each matter resolved subsequent to the filing or service of any initial litigation, arbitration or mediation document, including but not limited to the service of a "Notice to Arbitrate" under Part 137 of the Rules of the Chief Administrator, the filing of a Summons and Complaint, and the filing of Claim of Arbitration, but prior to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading; (3) 30% of the gross recovery for each matter resolved subsequent to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading, including but not limited to the filing by the Former Client of a "Client Request for Fee Arbitration" under Part 137 of the Rules of the Chief Administrator, the filing of an Answer or Motion, and the filing of a Response to a Claim for Arbitration; (4) 30% of the gross recovery of a matter resolved through default judgment as a result of a Former Client's default in any litigation or arbitration matter. * For matters with an outstanding legal fee owed to the Debtor in an amount greater than $500,000 and equal to or less than $1,000,000: (a) 10% of the gross recovery for each matter resolved prior to the filing or service of any initial litigation, arbitration or mediation document; (b) 17.5% of the gross recovery for each matter resolved subsequent to the filing or service of any initial litigation, arbitration or mediation document, including but not limited to the service of a "Notice to Arbitrate" under Part 137 of the Rules of the Chief Administrator, the filing of a Summons and Complaint, and the filing of Claim of Arbitration, but prior to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading; (c) 25% of the gross recovery for each matter resolved subsequent to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading, including but not limited to the filing by the Former Client of a "Client Request for Fee Arbitration" under Part 137 of the Rules of the Chief Administrator, the filing of an Answer or Motion, and the filing of a Response to a Claim for Arbitration; (d) 25% of the gross recovery of a matter resolved through default judgment as a result of a Former Client's default in any litigation or arbitration matter. * For matters with an outstanding legal fee owed [including disbursements] to the Debtor in an amount greater than $1,000,000: (w) 7.5% of the gross recovery for each matter resolved prior to the filing or service of any initial litigation, arbitration or mediation document; (x) 15% of the gross recovery for each matter resolved subsequent to the filing or service of any initial litigation, arbitration or mediation document, including but not limited to the service of a "Notice to Arbitrate" under Part 137 of the Rules of the Chief Administrator, the filing of a Summons and Complaint, and the filing of Claim of Arbitration, but prior to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading; (c) 22.5% of the gross recovery for each matter resolved subsequent to the filing by the Former Client of any responsive litigation, arbitration or mediation document or pleading, including but not limited to the filing by the Former Client of a "Client Request for Fee Arbitration" under Part 137 of the Rules of the Chief Administrator, the filing of an Answer or Motion, and the filing of a Response to a Claim for Arbitration; (d) 22.5% of the gross recovery of a matter resolved through default judgment as a result of a Former Client's default in any litigation or arbitration matter. To the best of the Debtor's knowledge, Y&K does not hold or represent any interest adverse to the Debtor or its estate with respect to the matters as to which Y&K is to be employed. About Dewey & LeBoeuf Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the wind-down of its operations. The firm had struggled with high debt and partner defections. Dewey disclosed debt of $245 million and assets of $193 million in its chapter 11 filing late evening on May 29, 2012. Dewey & LeBoeuf LLP operated as a prestigious, New York City- based, law firm that traced its roots to the 2007 merger of Dewey Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird -- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in 1929. In recent years, more than 1,400 lawyers worked at the firm in numerous domestic and foreign offices. At its peak, Dewey employed about 2,000 people with 1,300 lawyers in 25 offices across the globe. When it filed for bankruptcy, only 150 employees were left to complete the wind-down of the business. Dewey's offices in Hong Kong and Beijing are being wound down. The partners of the separate partnership in England are in process of winding down the business in London and Paris, and administration proceedings in England were commenced May 28. All lawyers in the Madrid and Brussels offices have departed. Nearly all of the lawyers and staff of the Frankfurt office have departed, and the remaining personnel are preparing for the closure. The firm's office in Sao Paulo, Brazil, is being prepared for closure and the liquidation of the firm's local affiliate. The partners of the firm in the Johannesburg office, South Africa, are planning to wind down the practice. The firm's ownership interest in its practice in Warsaw, Poland, was sold to the firm of Greenberg Traurig PA on May 11 for $6 million. The Pension benefit Guaranty Corp. took $2 million of the proceeds as part of a settlement. Judge Martin Glenn oversees the case. Albert Togut, Esq., at Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The petition was signed by Jonathan A. Mitchell, chief restructuring officer. JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the lenders under the Revolver Agreement, hired Kramer Levin Naftalis & Frankel LLP. JPMorgan, as Collateral Agent for the Revolver Lenders and the Noteholders, hired FTI Consulting and Gulf Atlantic Capital, as financial advisors. The Noteholders hired Bingham McCutchen LLP as counsel. The U.S. Trustee formed two committees -- one to represent unsecured creditors and the second to represent former Dewey partners. The creditors committee hired Brown Rudnick LLP led by Edward S. Weisfelner, Esq., as counsel. The Former Partners hired Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel. Dewey filed a Chapter 11 Plan of Liquidation and an accompanying Disclosure Statement on Nov. 21, 2012. It filed amended plan documents on Dec. 31, in an attempt to address objections lodged by various parties. A second iteration was filed Jan. 7, 2013. The plan is based on a proposed settlement between secured lenders and Dewey's official unsecured creditors' committee. It also incorporates a settlement approved by the bankruptcy court in October where 440 former partners will receive releases in return for $71.5 million in contributions. DEWEY & LEBOEUF: Kasowitz Defends $1.2-Mil. Fees Request --------------------------------------------------------- Brian Mahoney of BankruptcyLaw360 reported that Kasowitz Benson Torres & Friedman LLP asked a New York bankruptcy court Wednesday to approve $1.2 million in fees for representing the official committee of former partners in Dewey & LeBoeuf LLP's bankruptcy, saying the charges are proper and should be allowed despite the U.S. trustee's objections. In particular, the U.S. Trustee opposed part of a $677,000 charge that Kasowitz had charged in part for its effort to appoint a bankruptcy examiner in the case, the report related. About Dewey & LeBoeuf Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the wind-down of its operations. The firm had struggled with high debt and partner defections. Dewey disclosed debt of $245 million and assets of $193 million in its chapter 11 filing late evening on May 29, 2012. Dewey & LeBoeuf LLP operated as a prestigious, New York City- based, law firm that traced its roots to the 2007 merger of Dewey Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird -- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in 1929. In recent years, more than 1,400 lawyers worked at the firm in numerous domestic and foreign offices. At its peak, Dewey employed about 2,000 people with 1,300 lawyers in 25 offices across the globe. When it filed for bankruptcy, only 150 employees were left to complete the wind-down of the business. Dewey's offices in Hong Kong and Beijing are being wound down. The partners of the separate partnership in England are in process of winding down the business in London and Paris, and administration proceedings in England were commenced May 28. All lawyers in the Madrid and Brussels offices have departed. Nearly all of the lawyers and staff of the Frankfurt office have departed, and the remaining personnel are preparing for the closure. The firm's office in Sao Paulo, Brazil, is being prepared for closure and the liquidation of the firm's local affiliate. The partners of the firm in the Johannesburg office, South Africa, are planning to wind down the practice. The firm's ownership interest in its practice in Warsaw, Poland, was sold to the firm of Greenberg Traurig PA on May 11 for $6 million. The Pension Benefit Guaranty Corp. took $2 million of the proceeds as part of a settlement. Judge Martin Glenn oversees the case. Albert Togut, Esq., at Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The petition was signed by Jonathan A. Mitchell, chief restructuring officer. JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the lenders under the Revolver Agreement, hired Kramer Levin Naftalis & Frankel LLP. JPMorgan, as Collateral Agent for the Revolver Lenders and the Noteholders, hired FTI Consulting and Gulf Atlantic Capital, as financial advisors. The Noteholders hired Bingham McCutchen LLP as counsel. The U.S. Trustee formed two committees -- one to represent unsecured creditors and the second to represent former Dewey partners. The creditors committee hired Brown Rudnick LLP led by Edward S. Weisfelner, Esq., as counsel. The Former Partners hired Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel. Dewey filed a Chapter 11 Plan of Liquidation and an accompanying Disclosure Statement on Nov. 21, 2012. It filed amended plan documents on Dec. 31, in an attempt to address objections lodged by various parties. A second iteration was filed Jan. 7, 2013. The plan is based on a proposed settlement between secured lenders and Dewey's official unsecured creditors' committee. It also incorporates a settlement approved by the bankruptcy court in October where 440 former partners will receive releases in return for $71.5 million in contributions. DIGITAL ANGEL: Disputes Allflex's Claim for Defective Chips ----------------------------------------------------------- Under the terms of the Stock Purchase Agreement related to the sale of 100% of the outstanding capital stock of Destron Fearing Corporation between Allflex USA, Inc., and Digital Angel Corporation, $2.5 million of the purchase price payable to the Company was placed in an escrow fund, from which $59,275 was previously released to Allflex to cover certain agreed expenses, leaving a current balance of approximately $2.44 million remaining in escrow. The escrow agreement provides for a Jan. 22, 2013, release of funds. On Jan. 17, 2013, the Company received a formal updated notice of a claim under the purchase agreement from Allflex alleging that certain implantable chips supplied to an overseas customer were defective and stating that Allflex's claim against the funds held in escrow is $2.453 million. The Company believes that Allflex's claims are not recoverable from the escrow pursuant to the terms of the purchase agreement and therefore intends to vigorously dispute this claim. About Digital Angel Headquartered in New London, Connecticut, Digital Angel Corporation has two business segments, Digital Games and Signature Communications. Digital Games designs, develops and plans to publish consumer applications and mobile games for tablets, smartphones and other mobile devices. Signature Communications is a distributor of two-way communications equipment in the U.K. Products offered range from conventional radio systems used by the majority of SigComm's customers, for example, for safety and security uses and construction and manufacturing site monitoring, to trunked radio systems for large scale users, such as local authorities and public utilities. The Company's balance sheet at Sept. 30, 2012, showed $5.7 million in total assets, $7.5 million in total liabilities, and a stockholders' deficit of $1.8 million. The Company said in its quarterly report for the period ended Sept. 30, 2012, "Our historical sources of liquidity have included proceeds from the sale of businesses, the sale of common stock and preferred shares and proceeds from the issuance of debt. In addition to these sources, other sources of liquidity may include the raising of capital through additional private placements or public offerings of debt or equity securities, as well as joint ventures. However, going forward some of these sources may not be available, or if available, they may not be on favorable terms. In addition, our factoring line may also be amended or terminated at any time by the lender with six months' notice. These conditions indicate that there is substantial doubt about our ability to continue operations as a going concern, as we may be unable to generate the funds necessary to pay our obligations in the ordinary course of business." DISH NETWORK: Fitch Affirms 'BB-' Issuer Default Rating ------------------------------------------------------- Fitch Ratings affirms the 'BB-' Issuer Default Rating (IDR) assigned to DISH Network Corporation and its wholly owned subsidiary DISH DBS Corporation. Fitch has also affirmed the 'BB-' rating assigned to the senior unsecured notes issued by DDBS. The Rating Outlook for all of DISH's ratings remains Negative. DISH had approximately $10.4 billion of debt outstanding as of Sept. 30, 2012. Key Rating Drivers The key rating factors reflected by the ratings include: -- Weakening credit protection metrics; -- Lack of visibility and elevated event risks related to DISH's wireless strategy; -- Strong liquidity and free cash flow generation; -- Inconsistent operating results. DISH's credit profile has weakened considerably during the course of 2012 due to inconsistent operating performance and elevating debt levels, which together with the uncertainty related to the company's yet articulated wireless strategy, limits the company's financial flexibility at the current ratings level. On a pro forma basis, total debt outstanding as of Sept. 30, 2012 increased nearly 59% relative to year-end 2011 levels to approximately $11.9 billion. DISH's leverage increased to 3.8x on a pro forma basis as of Sept. 30, 2012 calculated on a last 12 month (LTM) basis. The cash proceeds from the company's incremental debt issuances have largely remained on its balance sheet purportedly to support DISH's wireless strategy. The Negative Outlook encompasses the lack of visibility as well as the potential capital and execution risks associated with DISH's wireless strategy. The economic viability of the strategy is questionable given the presence of strong entrenched market participants particularly if DISH's wireless offering fails to provide any meaningful service differentiation from established competitive offerings. Fitch acknowledges that a wireless network can potentially provide DISH with further strategic flexibility and enable the company to diversify its business and capture incremental revenue and cash flow growth. Event risks are elevated as the company contemplates additional acquisitions of spectrum or assets to support the wireless strategy. To that end, the evolution of DISH's wireless strategy took a step forward as evidenced by the company's proposal to enter into a multi-faceted, complicated series of agreements with Clearwire Corporation. Fitch Ratings believes the proposed transaction is a positive development for DISH, but could also pressure its current ratings. If the bid for Clearwire is successful, DISH would secure a potential partner to build and deploy a wireless network. DISH had previously signaled its preference to participate in a network infrastructure sharing arrangement to enter into the wireless market as opposed to deploying a greenfield wireless network. However, recent consolidation, investments and spectrum acquisitions within the wireless sector has reduced the number of potential entities DISH can partner with to deploy its wireless network creating an urgency to establish a partnership with Clearwire. In accordance with the terms of DISH's proposal, DISH would acquire, among other things, approximately 24% of Clearwire's wireless spectrum for $2.2 billion and a minimum of 25% of Clearwire's outstanding common stock. DISH secured FCC approval to use 40 MHz of S-band wireless spectrum (now designated as the AWS - 4 band). The FCC order includes power limitations on a portion of DISH's uplink spectrum and requires DISH to tolerate potential interference from adjacent wireless spectrum. The order requires DISH to provide reliable signal coverage and terrestrial service to 40% of its total AWS - 4 population within four years. The final build-out milestone requires signal coverage and service to 70% of population in each of its license areas within seven years. If DISH fails to meet the interim build-out requirement, the final build-out requirement will be accelerated from seven years to six years. Furthermore, if the final build-out requirement is not satisfied, DISH's license for each economic area not in compliance with the final build-out requirement will terminate automatically. The company's liquidity position is strong and supported by cash and marketable securities on hand and expected free cash flow generation. Cash marketable security balances, pro forma for the $1.5 billion senior note issuance during December 2012, increase to approximately $7.9 billion. Fitch notes that the company used approximately $700 million in cash to settle litigation and $450 million to fund a $1 per share special dividend. The company also benefits from a favorable maturity schedule, as the next scheduled maturity is in 2013 totaling $500 million followed by $1 billion during 2014. Fitch notes, however, that the company does not maintain a revolver, which increases DISH's reliance on capital market access to refinance current maturities, elevating the refinancing risk within the company's credit profile. The risk is offset by the company's consistent access to capital markets and strong execution. DISH generated nearly $857 million of free cash flow (defined as cash flow from operations less capital expenditures and dividends) during the LTM ended Sept. 30, 2012. Fitch expects capital intensity will be relatively consistent over the near term and that capital expenditures will continue to focus on subscriber retention and capitalized subscriber premises equipment. Absent further investment in a wireless network or other strategic initiative, Fitch anticipates that DISH will continue generating nearly $1 billion of annual free cash flow during the current ratings horizon while incorporating higher levels of cash taxes. Fitch believes the company's overall credit profile has limited capacity to accommodate DISH's inconsistent operating performance. While subscriber metrics remain weak, they have stabilized somewhat when compared to 2011 results. However, DISH struggles to increase service ARPUs as the company elected not to take a price increase during 2012. This decision combined with higher programming and subscriber acquisition costs has had a dramatic effect on the company's operating margins and EBITDA generation. These factors contributed to an 18.7% year-over-year decline in DISH's third-quarter EBITDA. EBITDA margin during the current period fell 400 basis points compared to the third quarter of last year, to 19.9%. Additional rating concerns center on DISH's ability to adapt to the evolving competitive landscape, DISH's lack of revenue diversity and narrow product offering relative to its cable MSO and telephone company video competition, and an operating profile and competitive position that continue to lag behind its peer group. DISH's current operating profile is focused on its maturing video service offering and lacks growth opportunities relative to its competition. Rating Triggers Revision of the Outlook to Stable at the current rating level can occur as the company demonstrates that it can execute its wireless strategy in a credit-neutral manner. In addition operating metrics, in particular subscriber additions, ARPU growth and EBITDA margins will need to begin to trend positive. Fitch believes negative rating action will likely coincide with the company's decision to execute a wireless strategy, or other discretionary management decisions that weaken its ability to generate free cash flow, erode operating margins, and increase leverage higher than 5x without a clear strategy to de-lever the company's balance sheet. Fitch has affirmed the following ratings with a Negative Rating Outlook: DISH Network Corporation --IDR at 'BB-'. DISH DBS Corporation --IDR at 'BB-'; --Senior unsecured notes at 'BB-'. DUNLAP OIL: Shareholders to Contribute $150,000 to Fund Plan ------------------------------------------------------------ Dunlap Oil Company Inc. and Quail Hollow Inn LLC are seeking to exit bankruptcy as a going concern pursuant to a joint plan of reorganization. According to Plan documents filed in Bankruptcy Court on Dec. 28, the Debtors propose to fund payments under the Plan through cash flow generated by the continued operations of the business and/or through alternate financing obtained from third parties. The Debtors anticipate that cash flow generated from the continued operation of the restructured business operations will increase and stabilize in the coming months, thereby increasing the cash flow for the remaining payments under the Plan. Because initial cash flows are insufficient to fund payments on the Plan effective date, the Plan provides that holders of equity interests in Dunlap Oil will contribute $150,000 to fund the Plan. The Plan groups claims against and equity interests in the Debtors in five classes. The Debtors propose to keep certain property and surrender the others to the secured creditors. Holders of secured claims will be satisfied through a combination of the return of collateral to the secured creditors and a restructured payment of the remaining balance. With respect to those properties being retained by the Debtors, holders of secured tax claims will either be paid in full on the later of the effective date or the allowance of the claim; or over a period of five years, with interest. With respect to those returned to the secured creditors, those creditors will be responsible for paying the secured tax claims. The Plan provides that Compass Bank will have a $5.99 million secured claim, which will be satisfied through the return of properties securing those claims with a fair market value of $4.36 million. The balance of $1.63 million will be paid in monthyly installments of $9,544 and secured by the Debtors' other properties. Compass, however, will have an option to elect to receive a discounted payoff in a lump sum totaling $3.2 million payable on the Plan effective date. If it chooses this option, all claims held by Compass will be deemed satisfied in full. The Debtors are funding the bankruptcy proceedings through the use of cash tied to prepetition secured debt with Compass Bank. That debt is now held by Pineda Grantor Trust II, successor-in-interest to Compass Bank. On Dec. 14, Pineda entered into a stipulation that grants the Debtors continued access to the cash collateral in exchange for the Debtors' provision of additional adequate protection, including monthly adequate protection payments and the Debtors' agreement to maintain a level of inventory consistent with its pre-petition inventory levels. The Plan also provides that Canyon Community Bank will be allowed a $6.31 million claim. Under the Plan, roughly $3.449 million in properties (at Fair Market Value) will be surrendered to the bank, and the balance will be satisfied through monthly payments of $16,500. The balance will be secured by the Debtors' other properties. Canyon may elect another payment option: a lump sum of $4.5 million payable on the effective date of the plan to satisfy all claims. The claims of Cox, another secured creditor, will be satisfied pursuant to an earlier settlement. Certain properties will be transferred to Cox and, as a result, Cox will retain and be allowed an $807,055 claim secured by other properties of the Debtors. The remaining claim will be paid in installments. Unsecured claims will be entitled to semi-annual pro rata share of the unsecured distribution amount for a period of five years after the plan effective date. Unsecured claims of so-called related parties will be deemed waived, and this group of claimants won't receive a dime. Shareholders of Dunlap Oil will keep their equity interests. Membership interests in QHI will be terminated and are out of the money. QHI will be dissolved following the sale or transfer of the Hotel to Pineda. About Dunlap Oil and Quail Hollow Inn Dunlap Oil Company, Inc., and Quail Hollow Inn, LLC, sought Chapter 11 protection (Bankr. D. Ariz. Case No. 12-23252 and 12-23256) on Oct. 24, 2012. Founded in 1958, Dunlap Oil is a Willcox, Arizona-based operator of 14 gasoline services stations. QOH owns the 89-room outside corridor Best Western Plus Quail Hollow hotel in Willcox. The two companies are owned and operated by the Dunlap family. Judge James M. Marlar presides over the case. John R. Clemency, Esq., and Lindsi M. Weber, Esq., at Gallagher & Kennedy, P.A., serve as the Debtors' counsel. Peritus Commercial Finance LLC serves as financial advisor. QOH declared assets of at least $1 million and debts exceeding $10 million. DOC estimated assets and debts of $10 million to $50 million. The petitions were signed by Theodore Dunlap, president. Ilene J. Lashinsky, the U.S. Trustee for Region 14, has appointed three creditors to serve on an Official Committee of Unsecured Creditor for the Chapter 11 bankruptcy case of Dunlap Oil Company. Pineda Grantor Trust II, successor-in-interest to Compass Bank, is represented by: Steven N. Berger, Esq. Bradley D. Pack, Esq. ENGELMAN BERGER, P.C. 3636 North Central Avenue, Suite 700 Phoenix, AZ 85012 Tel: (602) 271-9090 Fax: (602) 222-4999 Email: dwe@eblawyers.com bdp@eblawyers.com Attorneys for Canyon Community Bank NA are: Jeffrey G. Baxter, Esq. Pat P. Lopez III, Esq. Rebecca K. O'Brien, Esq. RUSING LOPEZ & LIZARDI PLLC 6363 N. Swan Rd., #151 Tucson, AZ 85718 E-mail: jbaxter@rllaz.com plopez@rllaz.com robrien@rllaz.com DRINKS AMERICAS: Incurs $9 Million Net Loss in Oct. 31 Quarter -------------------------------------------------------------- Drinks Americas Holdings, Ltd., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $9.01 million on $1.93 million of sales for the three months ended Oct. 31, 2012, compared with a net loss of $384,203 on $1.27 million of sales for the same period a year ago. For the six months ended Oct. 31, 2012, the Company reported a net loss of $9.45 million on $3.22 million of sales, compared with a net loss of $730,471 on $1.41 million of sales for the same period during the prior year. The Company's balance sheet at Oct. 31, 2012, showed $581,780 in total assets, $15.41 million in total liabilities and a $14.82 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/9RcuMk About Drinks Americas Headquartered in Wilton, Conn., Drinks Americas Holdings, Ltd. -- http://www.drinksamericas.com/-- through its majority-owned subsidiaries, Drinks Americas, Inc., Drinks Global, LLC, D.T. Drinks, LLC, and Olifant U.S.A Inc., imports, distributes and markets unique premium wine and spirits and alcoholic beverages associated with icon entertainers, celebrities and destinations, to beverage wholesalers throughout the United States. The Company reported a net loss of $4.58 million on $497,453 of net sales for the year ended April 30, 2011, compared with a net loss of $5.61 million on $890,380 of net sales during the prior year. After auditing the fiscal 2011 financial statements, Bernstein & Pinchuk, in New York, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses from operations since its inception and has a working capital deficiency. EASTBRIDGE INVESTMENT: Change of State of Incorporation Okayed -------------------------------------------------------------- EastBridge Investment Group Corporation held a general shareholder meeting on Jan. 18, 2013, in its corporate office in Scottsdale, Arizona. At the meeting, the stockholders (i) approved a change in the Company's state of incorporation from Arizona to Delaware and (ii) approved the Company's Amended and Restated 2011 Incentive Stock Option Plan. Meanwhile, on Jan. 15, 2012, EastBridge, CBMG Acquisition Limited, the Company's wholly-owned subsidiary and Cellular Biomedicine Group Ltd., amended the Agreement and Plan of Merger previously entered into on Nov. 13, 2012. Pursuant to Article II, Section 2.2 of the Merger Agreement the parties determined to extend the Drop Dead Date (as defined in the Merger Agreement) until Jan. 31, 2013. No additional amendments were made to the Merger Agreement. A copy of Amendment No. 1 to the Agreement and Plan of Merger is available at http://is.gd/fyPHz8 About EastBridge Investment Scottsdale, Arizona-based EastBridge Investment Group Corporation provides investment related services in Asia and in the United States, with a strong focus on the high GDP growth countries, such as China, Australia and the U.S. EastBridge is one of a small group of United States companies solely concentrated in marketing business consulting services to closely held, small to mid-size Asian and American companies that require these services for expansion. Tarvaran Askelson & Company, LLP, in Laguna Niguel, California, expressed substantial doubt about EastBridge Investment's ability to continue as a going concern, following its audit of the Company's financial statements for the fiscal year ended Dec. 31, 2011. The independent auditors noted that the Company has incurred significant losses and that the Company's viability is dependent upon its ability to obtain future financing and the success of its future operations. The Company's balance sheet at Sept. 30, 2012, showed $6.7 million in total assets, $4.5 million in total liabilities, and stockholders' equity of $2.2 million. EASTMAN KODAK: Updated Projections Posted with SEC -------------------------------------------------- Eastman Kodak Company shared new financial projections to certain of its creditors and their advisors facilitate discussions regarding its transformation and progress regarding its goals to exit bankruptcy as a profitable company. A copy of the presentation -- http://is.gd/xyn257-- was posted in a regulatory filing. The Company said it has made substantial progress towards these objectives and reshaping itself to capitalize on its competitively differentiated technologies and capabilities in order to emerge as a profitable, sustainable, market leading digital technology company. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak intends to reorganize by focusing on the commercial printing business. Other businesses are being sold or shut down. EASTMAN KODAK: Nixon Peabody Advising on U.S. Labor Matters ----------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York authorized Eastman Kodak Company, et al., to employ Nixon Peabody LLC as special counsel under a general retainer. The firm is expected to, among other things: -- advise the Debtors with regard to U.S. labor, employment and benefit matters and providing general support to the Debtors' human resources personnel in Rochester, New York and other locations throughout the U.S. where the Debtors have employees and defending claims related to such matters filed against the Debtors; -- advise the Debtors with regard to various specialized U.S. environmental law and permitting issues, particularly technical advice, regulatory issues with the NY Public Service Commission, and support for interactions with State and local officials and assisting general bankruptcy counsel with issues related to transfers of businesses and assets in connection with the Debtors' chapter 11 cases; and -- advise the Debtors in connection with various real property tax issues related to their ongoing businesses and restructuring and coordinating with general bankruptcy counsel with respect to such matters. The hourly rates of Nixon Peabody was redacted from court filings posted with the ECF. The Debtor said that Nixon Peabody's hourly rates have been redacted to preserve the confidentiality of commercially sensitive information. Unredacted versions of the application have been provided to Chambers, the U.S. Trustee, counsel to the Creditors' Committee, counsel to the Ad Hoc Committee of Second Lien Noteholders and the Fee Examiner, Richard Stern, Esq. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Alvarez & Marsal North America, LLC, serves as its financial adviser. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak intends to reorganize by focusing on the commercial printing business. Other businesses are being sold or shut down. EASTMAN KODAK: Commences Offer to Subscribe Exchange Notes ---------------------------------------------------------- Eastman Kodak Company on Jan. 24 announced the commencement of an offer to holders of its outstanding 10.625% Senior Secured Notes due March 15, 2019 (CUSIP Nos. 277461BK4 and U27746AH6) and 9.75% Senior Secured Notes due March 1, 2018 (CUSIP Nos. 277461BH1 and U27746AG8) to (i) subscribe for term loans on a pro rata basis in an amount up to the principal amount of Notes held by each holder, up to an aggregate amount for all holders together of $455,000,000, under a new junior secured priming superpriority debtor-in-possession term loan facility; and (ii) exchange Notes for up to an aggregate amount of $375,000,000 of junior term loans (the "Junior Loans") under the Junior DIP Facility. Holders participating in the offer will commit to becoming lenders under the Junior DIP Facility. New Money Loans will be allocated to each subscribing holder ratably based on the amount of New Money Loans it subscribes for over the total amount of New Money Loans subscribed for by all holders. Holders may elect to subscribe for New Money Loans in excess of the principal amount of Notes held by them in the event the aggregate initial subscription for New Money Loans by holders is less than $455,000,000. Additionally, certain holders have previously committed to fund New Money Loans to the extent the amount of New Money Loans funded pursuant to the offer is less than $455,000,000. Holders subscribing for New Money Loans will be offered the opportunity to exchange Notes for Junior Loans under the Junior DIP Facility based on the ratable portion of New Money Loans such holders fund. The offer will expire at 5:00 p.m., New York City time, on February 21, 2013, unless extended or earlier terminated by the Company in its sole discretion. The delivery of a validly executed letter of transmittal by a holder will constitute an irrevocable offer by such holder to fund New Money Loans and to exchange Notes for Junior Loans up to the amounts indicated therein. Such commitment to participate in the offer may not be withdrawn, unless otherwise determined by the Company, in its sole discretion. The consummation of the offer is subject to the closing of the Junior DIP Facility, which is subject to several conditions, including an amendment of the Company's existing DIP facility becoming effective and the satisfaction of the conditions precedent under the Junior DIP Facility. If these conditions are not satisfied or the Junior DIP Facility otherwise fails to close, the offer will terminate. Kodak currently expects that, subject to the satisfaction of the conditions precedent thereto, the Junior DIP Facility will close on February 28, 2013. Accordingly, it is expected that holders participating in the offer will be notified of their allocated amounts of New Money Loans and Junior Loans by February 25, 2013, and such holders will be required to fund their allocated amount of New Money Loans and tender Notes for exchange on February 26, 2013. Holders are referred to the offer documents for the complete terms of the offer. The offer documents are being distributed to holders beginning on Jan. 24. Kurtzman Carson Consultants LLC is the information agent for the offer. Wilmington Trust, National Association is the depository agent for the offer. Questions with respect to the offer and requests for copies of the offer documents may be directed to Kurtzman Carson Consultants LLC at (917) 281-4800 or KodakInfo@kccllc.com None of Kodak, the information agent, the depository agent, the administrative agent for the Junior DIP Facility or the Trustee for the Notes or any of their respective subsidiaries makes any recommendation in connection with the offer. Each holder of Notes must make its own decision as to whether or not to participate in the offer, and, if so, the amount at which it wishes to participate. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak intends to reorganize by focusing on the commercial printing business. Other businesses are being sold or shut down. EDISON MISSION: Schedules and Statements Due Feb. 14 ---------------------------------------------------- Edison Mission Energy and its affiliates are required to submit their statements of financial affairs, and schedules of assets and liabilities, current income and expenditures, and executory contracts unexpired leases by Feb. 14. The order signed by the bankruptcy judge extended the Debtor's deadline to file those documents by 45 days (for a total of 59 days following the Petition Date). About Edison Mission Santa Ana, California-based Edison Mission Energy is a holding company whose subsidiaries and affiliates are engaged in the business of developing, acquiring, owning or leasing, operating and selling energy and capacity from independent power production facilities. EME also engages in hedging and energy trading activities in power markets through its subsidiary Edison Mission Marketing & Trading, Inc. EME was formed in 1986 and is an indirect subsidiary of Edison International. Edison International also owns Southern California Edison Company, one of the largest electric utilities in the United States. EME and its affiliates sought Chapter 11 protection (Bankr. N.D. Ill. Lead Case No. 12-49219) on Dec. 17, 2012. EME has reached an agreement with the holders of a majority of EME's $3.7 billion of outstanding public indebtedness and its parent company, Edison International EIX, that, pursuant to a plan of reorganization and pending court approval, would transition Edison International's equity interest to EME's creditors, retire existing public debt and enhance EME's access to liquidity. The Company's balance sheet at Sept. 30, 2012, showed $8.17 billion in total assets, $6.68 billion in total liabilities and $1.48 billion in total equity. Kirkland & Ellis LLP is serving as legal counsel to EME, Perella Weinberg Partners, LP is acting as financial advisor and McKinsey Recovery & Transformation Services U.S., LLC is acting as restructuring advisor. GCG, Inc., si the claims and notice agent. EFD LTD: To Seek Case Dismissal at Feb. 4 Hearing ------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Texas will convene a hearing on Feb. 4, 2013, at 1:30 p.m., to consider EFD, Ltd's motion to dismiss its bankruptcy case. The Debtor relates that case dismissal is in the best interest of the creditors because of the foreclosure sale of the collateral pledged to Capital Farm Credit, the absence of any significant equity on the real estate pledged to Dale and Rita Steitle, the lack of any other material assets, and the limited number of remaining creditors. About EFD, Ltd. Austin, Texas-based EFD, Ltd., dba Blanco San Miguel, fdba Blanco San Miguel, Ltd., filed for Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 11-10846) on April 5, 2011. Eric J. Taube, Esq., at Hohmann Taube & Summers, LLP, in Austin, Texas, serves as the Debtor's bankruptcy counsel. The Company disclosed $128,207,835 in assets and $30,395,205 in liabilities as of the Chapter 11 filing. The Debtor has withdrawn its Plan of Reorganization dated Aug. 12, 2011. Secured creditor and party-in-interest Capital Farm Credit, FLCA, asked the Court to deny the confirmation of Debtor's Plan because the Debtor's Plan violates various provisions of both sections 1129(a) and 1129(b) of the Bankruptcy Code or other applicable authority. The U.S. Trustee has not yet appointed an official committee of unsecured creditors. The U.S. Trustee reserves the right to appoint such a committee should interest developed among the creditors. ENERGY FUTURE: Expects $2.2 Billion Net Loss in 2012 ---------------------------------------------------- Energy Future Holdings Corp., Energy Future Intermediate Holding Company LLC and Oncor Electric Delivery Holdings Company LLC provided selected preliminary unaudited financial data for the year ended Dec. 31, 2012. EFH Corp. estimated a net loss of $2.16 billion for the year ended Dec. 31, 2012, compared with the actual net loss of $1.91 billion during the prior year. EFH Corp.'s available liquidity (excluding Oncor Holdings and its subsidiaries) at Dec. 31, 2012, totaled $2.8 billion as compared to $2.4 billion at Dec. 31, 2011. EFIH estimated net income of $331 million for the year ended Dec. 31, 2012, compared with net income of $417 million during the prior year. Oncor Holdings expected net income of $340 million for 2012 compared with net income $360 million for 2011. A copy of the Form 8-K is available at http://is.gd/S5w7zn About Energy Future Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leverage buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. Energy Future had a net loss of $1.91 billion on $7.04 billion of operating revenues for the year ended Dec. 31, 2011, compared with a net loss of $2.81 billion on $8.23 billion of operating revenues during the prior year. The Company's balance sheet at Sept. 30, 2012, showed $42.73 billion in total assets, $51.90 billion in total liabilities and a $9.16 billion total deficit. * * * As reported by the TCR on Aug. 15, 2012, Moody's downgraded the Corporate Family Rating (CFR) of EFH to Caa3 from Caa2 and affirmed its Caa3 Probability of Default Rating (PDR) and SGL-4 Speculative Grade Liquidity Rating. The downgrade of EFH's CFR to Caa3 from Caa2 reflects the company's financial distress and limited financial flexibility. As reported by the TCR on Dec. 7, 2012, Fitch Ratings has lowered the Issuer Default Rating (IDR) of EFH to 'Restricted Default' (RD) from 'CC'. Fitch Ratings has deemed the recently concluded exchange offer to exchange a portion of the LBO notes and legacy notes at Energy Future Holdings Corp (EFH) for new 11.25%/12.25% senior toggle notes due 2018 at Energy Future Intermediate Holding Company LLC (EFIH) as a distressed debt exchange (DDE). In the Dec. 28, 2012, edition of the TCR, Standard & Poor's Ratings Services lowered its corporate credit ratings on EFIH, TCEH, and EFCH to 'CC' from 'CCC'. "We lowered to 'CC' from 'CCC' our corporate credit rating on EFH subsidiary EFCH. EFCH guarantees TCEH's senior secured debt (which includes the revolver) and so falls to 'CC' along with TCEH," S&P said. EPICEPT CORP: Sabby Healthcare Discloses 9.9% Equity Stake ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Sabby Healthcare Volatility Master Fund, Ltd., Sabby Management, LLC, and Hal Mintz disclosed that, as of Sept. 24, 2012, they beneficially own 8,324,714 shares of common stock of EpiCept Corporation representing 9.9% of the shares outstanding. A copy of the filing is available at http://is.gd/rdvTZm About EpiCept Corporation Tarrytown, N.Y.-based EpiCept Corporation (Nasdaq and Nasdaq OMX Stockholm Exchange: EPCT) -- http://www.epicept.com/-- is focused on the development and commercialization of pharmaceutical products for the treatment of cancer and pain. The Company's lead product is Ceplene(R), approved in the European Union for the remission maintenance and prevention of relapse in adult patients with Acute Myeloid Leukemia (AML) in first remission. In the United States, a pivotal trial is scheduled to commence in 2011. The Company has two other oncology drug candidates currently in clinical development that were discovered using in-house technology and have been shown to act as vascular disruption agents in a variety of solid tumors. The Company's pain portfolio includes EpiCept(TM) NP-1, a prescription topical analgesic cream in late-stage clinical development designed to provide effective long-term relief of pain associated with peripheral neuropathies. In the auditors' report accompanying the financial statements for year ended Dec. 31, 2011, Deloitte & Touche LLP, in Parsippany, New Jersey, noted that the Company's recurring losses from operations and stockholders' deficit raise substantial doubt about its ability to continue as a going concern. Epicept reported a net loss of $15.65 million in 2011, a net loss of $15.53 million in 2010, and a net loss of $38.81 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $2.86 million in total assets, $16.03 million in total liabilities and a $13.16 million in total stockholders' deficit. FIRST PLACE: Keefe Bruyette Approved as Investment Banker --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized First Place Financial Corp. to employ Keefe, Bruyette & Woods, Inc., as investment banker. Keefe Bruyette is expected to, among other things: -- assist the Debtor with identifying and contacting prospective Bank purchasers; -- assist and advise the Debtor in considering the desirability of any proposed bank sale and the definitive financial terms thereof; and -- assist the Debtor in devising a strategy for negotiating with prospective bank purchasers. KBW will be entitled to receive: * a contingent transaction fee equal to the greater of: (i) $2,500,000 or (ii) 0.12% of the aggregate consideration provided to First Place and its subsidiaries in connection with a contemplated sale transaction, provided that, the sale fee for a sale to a single purchaser of the Debtor's 100% interest in First Place Bank will be capped at $2,500,000; and * reimbursement of all reasonable, out-of-pocket expenses in an amount not to exceed $100,000 in the aggregate; To the best of the Debtor's knowledge, KBW is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About First Place First Place Financial Corp. is a $3.1 billion financial services holding company, based in Warren, Ohio. The First Place bank subsidiary isn't in bankruptcy. First Place filed a Chapter 11 petition (Bankr. D. Del. Case No. 12-12961) in Delaware on Oct. 28, 2012, to sell its bank unit to Talmer Bancorp, Inc., absent higher and better offers. The Debtor declared $175 million in total assets and $65.6 million in total liabilities as of Oct. 26, 2012. The Debtor has tapped Patton Boggs LLP and The Bayard Firm, PA as legal counsel, and FTI Consulting, Inc., as financial advisor. Donlin, Recano & Company, Inc. -- http://www.donlinrecano.com/-- is the claims and notice agent. The Official Committee of Trust Preferred Securities tapped to retain Kirkland & Ellis as counsel; Klehr Harrison Harvey Branzburg as co-counsel; Holdco Advisors as financial advisor; and Rothschild as investment banker and financial advisor. FREESEAS INC: Issues 1.7 Million Common Shares to Hanover --------------------------------------------------------- Pursuant to the terms of a settlement agreement between FreeSeas Inc., and Hanover Holdings I, LLC, in the matter entitled Hanover Holdings I, LLC v. FreeSeas Inc., Case No. 654474/2012, approved by the Supreme Court of the State of New York, County of New York, FreeSeas Inc., issued and delivered to Hanover Holdings I, LLC, 1,375,000 shares of the Company's common stock, $0.001 par value. Hanover commenced the Action against the Company on Dec. 21, 2012, to recover an aggregate of $305,485 of past-due accounts payable of the Company, plus fees and costs. The Settlement Agreement became effective and binding upon the Company and Hanover upon execution of the Order by the Court on Jan. 14, 2013. Hanover demonstrated to the Company's satisfaction that it was entitled to receive 400,000 additional settlement shares based on certain adjustment formula, and that the issuance of those Additional Settlement Shares to Hanover would not result in Hanover exceeding the beneficial ownership limitation set forth above. Accordingly, on January 18, the Company issued and delivered to Hanover 400,000 Additional Settlement Shares pursuant to the terms of the Settlement Agreement approved by the Order. About FreeSeas Inc. Headquartered in Athens, Greece, FreeSeas Inc., formerly known as Adventure Holdings S.A., was incorporated in the Marshall Islands on April 23, 2004, for the purpose of being the ultimate holding company of ship-owning companies. The management of FreeSeas' vessels is performed by Free Bulkers S.A., a Marshall Islands company that is controlled by Ion G. Varouxakis, the Company's Chairman, President and CEO, and one of the Company's principal shareholders. The Company's fleet consists of six Handysize vessels and one Handymax vessel that carry a variety of drybulk commodities, including iron ore, grain and coal, which are referred to as "major bulks," as well as bauxite, phosphate, fertilizers, steel products, cement, sugar and rice, or "minor bulks." As of Oct. 12, 2012, the aggregate dwt of the Company's operational fleet is approximately 197,200 dwt and the average age of its fleet is 15 years. As reported in the Troubled Company Reporter on July 18, 2012, Ernst & Young (Hellas) Certified Auditors Accountants S.A., in Athens, Greece, expressed substantial doubt about FreeSeas' ability to continue as a going concern, following its audit of the Company's financial statements for the fiscal year ended Dec. 31, 2011. The independent auditors noted that the Company has incurred recurring operating losses and has a working capital deficiency. "In addition, the Company has failed to meet scheduled payment obligations under its loan facilities and has not complied with certain covenants included in its loan agreements with banks." The Company's balance sheet at June 30, 2012, showed US$120.8 million in total assets, US$104.1 million in total current liabilities, and shareholders' equity of US$16.7 million. FRESNO, CA: Moody's Cuts Ratings on 2006A Convention Center Bonds ----------------------------------------------------------------- Moody's Investors Service has downgraded to Ba1 From Baa2 the ratings on Fresno's Series 2002, Series 2004 A, B, C; Series 2008 A, C, E F and Series 2009A Lease Revenue Bonds. Moody's has also downgraded to Ba2 from Baa2 the ratings on the city's 2006A Convention Center bonds, 2002 Pension Obligation Bonds and 2002 Judgment Obligation Bonds . The A3 Issuer rating has been confirmed. The outlook on the ratings is negative. Ratings Rationale The Ba1 ratings on most of the city's lease secured obligations reflect the significantly weaker security of these obligations compared to general obligations. The four notches between Fresno's issuer rating and the ratings on these lease secured obligations reflect the city's exceedingly weak financial position, the above average burden of these obligations on the city's finances and the continued weakness of the city's economy. The Ba2 rating on the 2006 Convention center bonds reflects the lesser essentiality of the leased assets relative to the obligations rated Ba1. The Ba2 rating on the pension and judgment obligations incorporates the weak credit factors mentioned above and the additional weakness associated with the absence of assets securing the obligation. The A3 issuer (general obligation equivalent) rating primarily reflects the assumed GO pledge, which in California is an unlimited ad valorem pledge of the city's tax base. The rating also reflects the factors mentioned above, which are partly offset by the city's large and stabilizing tax base. The city's favorable position as the economic center of the San Joaquin Valley, a well- funded pension system and the city's moderate post-employment benefit obligation also figure favorably in the issuer rating. STRENGTHS - Sizable, comparatively resilient assessed valuation relative to market prices - Increased transparency and financial discipline with regard to enterprise risks - Economic center of the San Joaquin Valley - Fully funded retirement systems CHALLENGES - Exceedingly limited financial flexibility - High general fund fixed cost burden - Weak economic base, with unfavorable demographic and economic trends - Structural imbalance in the 2013 budget will likely widen the general fund deficit OUTLOOK The negative outlook reflects the city's narrow financial position and limited prospect for improvement in the near-term, amid the ongoing risk for added financial pressure from a weak local economy. The city's depleted reserves limit its financial flexibility and ability to absorb additional budgetary pressure. Like all California cities, Fresno's ability to raise revenues is highly constrained; its primary budget balancing option is cost reduction. However, with services already significantly reduced, further cuts could prove more difficult. Although the typical time horizon for a Moody's outlook is eighteen months, we are likely to revisit the rating midway through the current fiscal year, and assess the financial progress of the city as it relates the adopted budget. WHAT COULD MOVE THE RATING UP Improved liquidity Improved reserve levels Increased self-sufficiency/decreased subsidy of troubled enterprise operations Structural operating adjustments to align ongoing expenditures with ongoing revenues WHAT COULD MOVE THE RATING DOWN Weakened liquidity Weakened reserve levels Deterioration of/increased subsidy of troubled enterprise operations Inability to align ongoing expenditures with ongoing revenues The principal methodology used in rating the general obligation bonds was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. The principal methodology used in rating the lease revenue bonds was The Fundamentals of Credit Analysis for Lease-Backed Municipal Obligations published in December 2011. FUEL DOCTOR: Court Dismisses "McGinnis" Suit in L.A. ---------------------------------------------------- Derrick McGinnis, on or about Jan. 8, 2013, filed an application for voluntary dismissal of the claim in a matter entitled Derrick McGinnis, on Behalf of Himself and All Others Similarly Situated v. Fuel Doctor, LLC, a California Limited Liability Company, and DOES 1-20, Inclusive filed on July 26, 2011, in the Superior Court of the State of California for the County of Los Angeles, Case No. BC 466 191. The Claim alleged that the Company's product did not work as advertised. The Court later dismissed the Claim against all defendants. About Fuel Doctor Calabasas, Calif.-based Fuel Doctor Holdings, Inc., is the exclusive distributor for the United States and Canada of a fuel efficiency booster (the FD-47), which plugs into the lighter socket/power port of a vehicle and increases the vehicle's miles per gallon through the power conditioning of the vehicle's electrical systems. The Company has also developed, and plans on continuing to develop, certain related products. Fuel Doctor reported a net loss of $2.69 million in 2011, compared with a net loss of $2.48 million in 2010. Rose, Synder & Jacobs LLP, in Encino, California, issued a "going concern" qualification on the consolidated financial statements for the period ended Dec. 31, 2011. The indepdent auditors noted that the Company has sustained recurring operating losses, continues to consume cash in operating activities, and has an accumulated deficit at Dec, 31, 2011, which conditions raise substantial doubt about the Company's ability to continue as a going concern. The Company's balance sheet at Sept. 30, 2012, showed $1.37 million in total assets, $1.61 million in total liabilities and a $240,899 total shareholders' deficit. FUELSTREAM INC: Peak One to Resell 1.1 Million Common Shares ------------------------------------------------------------ Fuelstream, Inc., filed a Form S-1 registration statement with the U.S. Securities and Exchange Commission relating to the offering of up to 1,121,584 shares of common stock of the Company by Peak One Opportunity Fund, L.P., for a proposed maximum aggregate offering price of $2.75 million. The Company will not receive any of the proceeds from the sale of the shares by the selling stockholder. The Company's common stock is traded on the over- the-counter market under the symbol "FLST". The closing bid price for the Company's common stock on Jan. 15, 2013, was $2.02 per share, as reported by the OTCQB. A copy of the Form S-1 prospectus is available at http://is.gd/TMgQr9 About Fuelstream Draper, Utah-based Fuelstream, Inc., is an in-wing and on-location supplier and distributor of aviation fuel to corporate, commercial, military, and privately-owned aircraft throughout the world. The Company also provides a variety of ground services either directly or through its affiliates, including concierge services, passenger andbaggage handling, landing rights, coordination with local aviation authorities, aircraft maintenance services, catering, cabin cleaning, customsapprovals, and third- party invoice reconciliation. The Company's personnel assist customers in flight planning and aircraft routing aircraft, obtaining permits, arranging overflies, and flight follow services. Morrill & Associates, LLC, in Bountiful, Utah, expressed substantial doubt about Fuelstream'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 negative working capital, negative cash flows from operations and recurring operating losses. The Company's balance sheet at Sept. 30, 2012, showed $3.04 million in total assets, $4.87 million in total liabilities and a $1.82 million total stockholders' deficit. GATEWAY CASINOS: Failed Casino Bid No Impact on Moody's B2 CFR -------------------------------------------------------------- Moody's Investors Service commented that City Council's vote on January 19, 2013 to reject Gateway Casinos & Entertainment Limited's South Surrey casino proposal is credit positive but has no immediate impact on the company's B2 corporate family rating (CFR) or stable outlook. GLYECO INC: Further Amends Report on ARI Acquisition ---------------------------------------------------- GlyEco, Inc., has re-filed in its entirety its amended current report on Form 8-K/A to correct two typographical errors on the Pro Forma Consolidated Statement of Operations for Sept. 30, 2012, in Exhibit 99.3. In the previously filed Form 8-K/A, the gross profit for Antifreeze Recycling, Inc., was listed as $485,985. This number has been corrected to show $42,315. Under the Pro Forma Consolidated column the gross profit shown was $351,405. This number has been corrected to show $198,925. All other numbers in the Operations Pro Forma are correct and remain unchanged. GlyEco Acquisition Corp. #6, an Arizona corporation and wholly- owned subsidiary of the Company, acquired the business and all of the glycol-related assets of Antifreeze Recycling, Inc., a South Dakota corporation, effective Oct. 29, 2012, pursuant to that certain Asset Purchase Agreement, dated Oct. 3, 2012, as amended, by and among Acquisition Sub, ARI, and Robert J. Kolhoff, the selling principal of ARI. Copies of the re-filed exhibits are available at: http://is.gd/OkOAsi http://is.gd/2Km64e http://is.gd/x7jddh About GlyEco, Inc. Phoenix, Ariz.-based GlyEco, Inc., is a green chemistry company formed to roll-out its proprietary and patent pending glycol recycling technology that transforms waste glycols, a hazardous material, into profitable green products. Jorgensen & Co., in Lehi, Utah, expressed substantial doubt about GlyEco'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 not yet achieved profitable operations and is dependent on the Company's ability to raise capital from stockholders or other sources and other factors to sustain operations. The Company's balance sheet at Sept. 30, 2012, showed $1.55 million in total assets, $2.24 million in total liabilities and a $685,243 total stockholders' deficit. GLYECO INC: Full Circle Owner Joins Glyeco Board of Directors ------------------------------------------------------------- The Board of Directors of GlyEco, Inc., approved an increase to the size of the board from four to five and elected Joseph A. Ioia to be a director of the Company to fill the newly created vacancy. No arrangements or understandings between Mr. Ioia and any other person pursuant to which Mr. Ioia was selected as a director. Mr. Ioia does not serve on any committees. Board compensation consists of a cash payment of $500 per quarter and a grant of 50,000 stock options per year. Mr. Ioia is the sole shareholder of Full Circle Manufacturing Group, Inc. Full Circle operates a business located in Elizabeth, New Jersey, relating to processing recyclable glycol streams and selling glycol as remanufactured product. It is one of the largest glycol recyclers in North America. Mr. Ioia is also the sole member of NY Terminals II, LLC, a New Jersey limited liability company which operates a significant liquid bulk storage facility. As previously reported, GlyEco Acquisition Corp. #4, and the Company entered into a transaction with Mr. Ioia and Full Circle on Dec. 10, 2012, pursuant to which Mr. Ioia sold to the Subsidiary the worldwide right, title, and interest in the exclusive glycol remanufacturing process used by Full Circle in consideration for $2,000,000 provided by the Company, and Full Circle agreed to perform the manufacturing and distribution services relating to its glycol recycling business to exclusively produce remanufactured glycol for the benefit of the Subsidiary. The Company issued 3,000,000 unregistered shares of the Company's common stock, at a fair market value of $0.50 per share, to Mr. Ioia as additional consideration for the transaction. About GlyEco, Inc. Phoenix, Ariz.-based GlyEco, Inc., is a green chemistry company formed to roll-out its proprietary and patent pending glycol recycling technology that transforms waste glycols, a hazardous material, into profitable green products. Jorgensen & Co., in Lehi, Utah, expressed substantial doubt about GlyEco'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 not yet achieved profitable operations and is dependent on the Company's ability to raise capital from stockholders or other sources and other factors to sustain operations. The Company's balance sheet at Sept. 30, 2012, showed $1.55 million in total assets, $2.24 million in total liabilities and a $685,243 total stockholders' deficit. GRANITE DELLS: Debtor, Equity Holders Balk at AED Plan Outline -------------------------------------------------------------- Granite Dells Ranch Holding, LLC has problems with the Chapter 11 plan proposed by an ad hoc committee of noteholders and Arizona Eco Development LLC. According to the Debtors, the disclosure statement explaining AED's Chapter 11 plan: -- fails to explain the impact of the bankruptcy case of Cavan Management Services, LLC, and the automatic stay pertinent to that case on AED's proposed Plan; -- proposes to remove potential causes of action from the estate, and vest control of the assets in AED, without any consideration; -- fails to address the exercise of the 1111(b) election by AED and the impact of that election; -- proposes an impermissible transfer of the estate's documents and attorney/client privileges to AED; and -- fails to list potential avoidance claims. The Unofficial Ad Hoc Committee of Equity Holders -- investors in Granite Dells Investors, LLC and Granite Dells Equity Group Investors, LLC -- joins the objection filed by the Debtors to AED's Disclosure Statement. The Equity Holders Committee is represented by: Warren J. Stapleton OSBORN MALEDON, P.A. 2929 North Central Avenue, 21st Floor Phoenix, Arizona 85012-2793 Tel: (602) 640-9000 E-mail: wstapleton@omlaw.com AED's Plan As reported in the TCR on Dec. 20, 2012, according to the AED's Plan dated Dec. 4, 2012, proposes that two parcels of real property, a 108-acre parcel and a 17-acre parcel will be transferred free and clear of all liens, claims, and encumbrances to a new entity, NH Co. LLC, which will be owned entirely by the note holders. Arizona Eco and NH Co. LLC will share the responsibility for any deficit to pay the Allowed Administrative Claims of the estate, with Arizona Eco to be responsible to pay 65% of that amount and NH Co. LLC. to be responsible to pay 35% of that amount, with a cap in the amount of $450,000 on the amount allocated to be paid by NH Co. LLC. Arizona Eco has agreed to and will advance the funds necessary to pay the portion of Allowed Administrative Claims allocable to NH Co. LLC. Arizona Eco will be repaid the amount it advances to NH Co. LLC for that purpose from the first proceeds from the sale of the Note Holders' Parcels, plus interest at the rate of 8% per annum. All other property and property interests of the estate are to be transferred or foreclosed upon by Arizona Eco, except that suits and claims held or owned by the Estate against any member of the Cavan Group will be transferred to and may be pursued by Arizona Eco or its nominee, with any net recoveries to be paid 80% to Arizona Eco and 20% to NH Co. LLC. All other general unsecured claims will be paid 10% of their principal amount if or when allowed by a final order of the court, and claims will be paid when finally allowed; however, Arizona Eco agrees as part of the proposed Joint Plan to not assert any unsecured deficiency claim in the General Unsecured Class, except as a set-off against any Claim held by any member of the Cavan Group. The equity interests are terminated under the Joint Plan and equity holders do not receive payment. About Granite Dells Ranch Holdings Scottsdale, Arizona-based Granite Dells Ranch Holdings LLC filed a bare-bones Chapter 11 petition (Bankr. D. Ariz. Case No. 12-04962) in Phoenix on March 13, 2012. Judge Redfield T. Baum PCT Sr. oversees the case. The Debtor is represented by Alan A. Meda, Esq., at Stinson Morrison Hecker LLP. The Debtor disclosed $2.22 million in assets and $157 million in liabilities as of the Chapter 11 filing. Cavan Management Services, LLC is the Debtor's manager. David Cavan, member of the firm, signed the Chapter 11 petition. Arizona ECO Development LLC, which acquired a $83.2 million 2006 loan by the Debtor, is represented by Snell & Wilmer L.L.P. The resolution authorizing the Debtor's bankruptcy filing says the Company is commencing legal actions against Stuart Swanson, AED, and related entities relating to the purchase by Mr. Swanson of a promissory note payable by the Company to the parties that sold a certain property to the Company. According to Law 360, AED sued Granite Dells on March 6 asking the Arizona court to appoint a receiver. Arizona ECO is foreclosing on a secured loan backed by 15,000 acres of Arizona land. The United States Trustee said that an official committee has not been appointed in the bankruptcy case of Granite Dells because an insufficient number of unsecured creditors have expressed interest in serving on a committee. The Debtor's Plan provides for payment to unsecured creditors (including any unsecured claim of AED) in quarterly installments over eight years aggregating $5 million. However, the Plan provides that a holder of an investment promissory note (estimated to total $21 million) will be given the option of participating in the funding of the Reorganized Debtor. Tri-City Investment & Development, LLC, a 39.25% equity holder in the Debtor, also filed a Consolidated Supplemental Disclosure in support of Tri-City's Plan, as amended. Tri-City's consolidated Disclosure Statement incorporates and restates all material terms of the Tri-City's previous disclosure statements and incorporates the terms of the agreement that was reached at the Aug. 20, 2012, mediation. HAWKER BEECHCRAFT: Wants to Hire ICF SH&E as Appraisers ------------------------------------------------------- Hawker Beechcraft, Inc., et al., ask the U.S. Bankruptcy Court for the Southern District of New York for permission to employ ICF SH&E, Inc., as appraisers. The Debtors relate that a key element remaining to their restructuring is access to sufficient exit financing. The Debtors, with the help of their legal and financial advisors, are in the process of reviewing numerous potential sources for exit financing. Among these potential sources for exit financing, the Debtors will select the potential exit financing lenders who submit the most attractive proposals to complete diligence, document preparation, and related efforts with respect to exit financing. In order to complete the due diligence process, ICF SH&E will assist them in their efforts to secure exit financing. In addition, ICF SH&E will assist the Debtors in asset valuation to meet the requirements of fresh start accounting. In summary, the services include: a. in support of exit financing, a determination of the current market value and net orderly liquidation value of the Subject Assets(Task 1); and b. in support of its fresh start accounting requirements, a determination of the fair value of the Subject Assets as of Feb. 28, 2013,(Task 2). The appraisal engagement letter provides for Task 1 services to be charged at a fixed rate of $195,000 and Task 2 services to be charged at a fixed rate of $100,000 plus a standard 5% administrative fee in lieu of certain itemized expenses. The hourly rate of the firm's personnel are: Vice Presidents $510 Principals $400 Manager & Senior Managers $280 to $320 Associates & Senior Associates $220 to $240 Analysts $210 To the best of the Debtors' knowledge, ICF SH&E is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A hearing on Jan. 25, 2013, at 12 p.m. has been set. Objections, if any, are due Jan. 25. About Hawker Beechcraft Hawker Beechcraft Acquisition Company, LLC, headquartered in Wichita, Kansas, manufactures business jets, turboprops and piston aircraft for corporations, governments and individuals worldwide. Hawker Beechcraft reported a net loss of $631.90 million on $2.43 billion of sales in 2011, compared with a net loss of $304.30 million on $2.80 billion of sales in 2010. Hawker Beechcraft Inc. and 17 affiliates filed for Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-11873) on May 3, 2012, having already negotiated a plan that eliminates $2.5 billion in debt and $125 million of annual cash interest expense. The plan will give 81.9% of the new stock to holders of $1.83 billion of secured debt, while 18.9% of the new shares are for unsecured creditors. The proposal has support from 68% of secured creditors and holders of 72.5% of the senior unsecured notes. Hawker is 49%-owned by affiliates of Goldman Sachs Group Inc. and 49%-owned by Onex Corp. The Company's balance sheet at Dec. 31, 2011, showed $2.77 billion in total assets, $3.73 billion in total liabilities and a $956.90 million total deficit. Other claims include pensions underfunded by $493 million. Hawker's legal representative is Kirkland & Ellis LLP, its financial advisor is Perella Weinberg Partners LP and its restructuring advisor is Alvarez & Marsal. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Sidley Austin LLP serves as legal counsel and Houlihan Lokey Howard & Zukin Capital Inc. serves as financial advisor to the DIP Agent and the Prepetition Agent. Wachtell, Lipton, Rosen & Katz represents an ad hoc committee of senior secured prepetition lenders holding 70% of the loans. Milbank, Tweed, Hadley & McCloy LLP represents an ad hoc committee of holders of the 8.500% Senior Fixed Rate Notes due 2015 and 8.875%/9.625% Senior PIK Election Notes due 2015 issued by Hawker Beechcraft Acquisition Company LLC and Hawker Beechcraft Notes Company. The members of the Ad Hoc Committee -- GSO Capital Partners, L.P. and Tennenbaum Capital Partners, LLC -- hold claims or manage accounts that hold claims against the Debtors' estates arising from the purchase of the Senior Notes. Deutsche Bank National Trust Company, the indenture trustee for senior fixed rate notes and the senior PIK-election notes, is represented by Foley & Lardner LLP. An Official Committee of Unsecured Creditors appointed in the case has selected Daniel H. Golden, Esq., and the law firm of Akin Gump Strauss Hauer & Feld LLP as legal counsel. The Committee's financial advisor is FTI Consulting, Inc. On June 30, 2012, Hawker filed its Plan, which proposed to eliminate $2.5 billion in debt and $125 million of annual cash interest expense. The plan would give 81.9% of the new stock to holders of $1.83 billion of secured debt, while 18.9% of the new shares are for unsecured creditors. The proposal has support from 68% of secured creditors and holders of 72.5% of the senior unsecured notes. In July 2012, Hawker disclosed it was in exclusive talks with China's Superior Aviation Beijing Co. for the purchase of Hawker's corporate jet and propeller plane operations out of bankruptcy for $1.79 billion. In October 2012, Hawker unveiled that those talks have collapsed amid concerns a deal with Superior wouldn't pass muster with a U.S. government panel and other cross-cultural complications. Sources told The Wall Street Journal that Superior encountered difficulties separating Hawker's defense business from those units in a way that would make both sides comfortable the deal would get U.S. government clearance. The sources told WJS the defense operations were integrated in various ways with Hawker's civilian businesses, especially the propeller plane unit, in ways that proved difficult to untangle. Thereafter, Hawker said it intends to emerge from bankruptcy as an independent company. On Oct. 29, 2012, Hawker filed a modified reorganization plan and disclosure materials. Hawker said the plan was supported by the official creditors' committee and by a "substantial majority" of holders of the senior credit and a majority of holders of senior notes. Hawker said it will either sell or close the jet-manufacturing business. The revised plan still offers 81.9% of the new stock in return for $921 million of the $1.83 billion owing on the senior credit. Unsecured creditors are to receive the remaining 18.9% of the new stock. Holders of the senior credit will receive 86% of the new stock. The senior credit holders are projected to have a 43.1% recovery from the plan. General unsecured creditors' recovery is a projected 5.7% to 6.3%. The recovery by holders of $510 million in senior notes is predicted to be 9.2% to 10%. HEALTHWAREHOUSE.COM INC: In Talks with Lenders to Avert Sale ------------------------------------------------------------ HealthWarehouse.com, Inc., is currently in the process of seeking additional financing and negotiating with its lenders, to address its current liquidity constraints and to satisfy its obligations under two of its loan agreements. The Company is currently in default under its Loan and Security Agreement dated Sept. 2, 2011, and Loan and Security Agreement dated Nov. 9, 2010, for failure to make the required payments for $3.4 million in principal and interest to two accredited investors. The Company received a notice from the Lenders informing it that the Lenders intend to make a sale of certain of the Collateral under Article 9 of the New York Uniform Commercial Code on Feb. 15, 2013. The Company does not intend to cooperate with the Article 9 Sale if it occurs. The Company's obligations under the 2011 Loan Documents are secured by a first-priority security interest in substantially all the assets of the Company and its subsidiaries, including, without limitation, inventory and the equipment the Company uses to fill prescriptions. The 2011 Loan Documents also require the Company to pay to the Lenders all costs and expenses incurred in connection with the enforcement and collection of its obligations thereunder. The Company does not currently have sufficient resources to pay its obligations under the 2011 Loan Documents and the 2010 Loan Documents, and it does not believe that the value of the Collateral will be sufficient to satisfy these obligations. Accordingly, if the Company enters, or is compelled to enter, a restructuring, reorganization, or liquidation, inside or outside of bankruptcy, it is unlikely that significant, or any, resources will be available for distribution to its unsecured creditors, to its preferred stock holders or to the holders of its common stock. About HealthWarehouse.com HealthWarehouse.com, Inc., headquartered in Florence, Kentucky, is a U.S. licensed virtual retail pharmacy ("VRP") and healthcare e- commerce company that sells brand name and generic prescription drugs as well as over-the-counter ("OTC") medical products. The Company's balance sheet at June 30, 2012, showed $2.24 million in total assets, $6.82 million in total liabilities, $752,226 in redeemable preferred stock, and a $5.33 million total stockholders' deficiency. The Company reported a net loss of $5.71 million in 2011, compared with a net loss of $3.69 million in 2010. "Since inception, the Company has financed its operations primarily through product sales to customers, debt and equity financing agreements, and advances from stock holders. As of June 30, 2012 and December 31, 2011, the Company had negligible cash and working capital deficiency of $5,724,914 and $2,404,464, respectively. For the six months ended June 30, 2012, cash flows included net cash used in operating activities of $581,948, net cash provided by investing activities of $138,241 and net cash provided by financing activities of $443,846. Additionally, all of the Company's outstanding convertible notes payable mature at the end of December 2012 and outstanding notes payable mature in January 2013. These conditions raise substantial doubt about the Company's ability to continue as a going concern," the Company said in its quarterly report for the period ended June 30, 2012. In the auditors' report accompanying the consolidated financial statement for the year ended Dec. 31, 2011, Marcum LLP, in New York, expressed substantial doubt about HealthWarehouse.com's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. HERCULES OFFSHORE: Files Fleet Status Report as of Jan. 22 ---------------------------------------------------------- Hercules Offshore, Inc., on Jan. 22, 2013, posted on its Web site at www.herculesoffshore.com a report entitled "Hercules Offshore Fleet Status Report". The Fleet Status Report includes the Hercules Offshore Rig Fleet Status (as of Jan. 22, 2013), which contains information for each of the Company's drilling rigs, including contract dayrate and duration. The Fleet Status Report also includes the Hercules Offshore Liftboat Fleet Status Report, which contains information by liftboat class for December 2012, including revenue per day and operating days. The Fleet Status Report is available for free at http://is.gd/TBv0Kn About Hercules Offshore Hercules Offshore Inc. (NASDAQ: HERO) -- http://www.herculesoffshore.com/-- provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the United States, Gulf of Mexico and internationally. The Company provides these services to integrated energy companies, independent oil and natural gas operators and national oil companies. The Company operates in six business segments: Domestic Offshore, International Offshore, Inland, Domestic Liftboats, International Liftboats and Delta Towing. The Company reported a net loss of $76.12 million in 2011, a net loss of $134.59 million in 2010, and a net loss of $91.73 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $2.02 billion in total assets, $1.15 billion in total liabilities and $877.24 million stockholders' equity. * * * The Troubled Company Reporter said on March 23, 2012, that Moody's Investors Service upgraded Hercules Offshore, Inc., Corporate Family Rating (CFR) and Probability of Default Rating (PDR) to B3 from Caa1 contingent upon the completion of its recently announced recapitalization plan. Hercules' B3 CFR reflects its jackup fleet, which consists primarily of standard specification rigs with an average age of about 30 years. Its rigs are geographically concentrated in the Gulf of Mexico (GoM), a market that experienced a slow-down after the Macondo well incident. However, over the last year a pick-up in permitting and activity levels in the GoM, has led to higher dayrates. For Hercules, the improving market conditions have stabilized its cash flow from operations, which are expected continue to improve for at least the next 18 to 24 months as old contracts roll into new contracts with higher dayrates. These improving market conditions support the decision to upgrade Hercules' CFR at this time. As reported by the TCR on Nov. 6, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Houston-based Hercules Offshore Inc. to 'B' from 'B-'. "The upgrade reflects the improving market conditions in the Gulf of Mexico and our expectations that Hercules' fleet will continue to benefit," said Standard & Poor's credit analyst Stephen Scovotti. HOSTESS BRANDS: Metropoulos Plans to Bid for Cakes Biz with Apollo ------------------------------------------------------------------ Dawn McCarty and Duane D. Stanford, writing for Bloomberg News, reported that C. Dean Metropoulos & Co. said it plans to bid for the cakes business of bankrupt Twinkies maker Hostess Brands Inc. with Apollo Global Management. "We continue to be very engaged in the bidding process," Daren Metropoulos, a principal at the private-equity firm that owns Pabst Brewing Co., said in an e-mail to Bloomberg. "We are working diligently to get a deal done." The cake brands of the 82-year-old maker of Ding Dongs, Ho Hos and Drake's Devil Dogs drew multiple bidders, Hostess lawyers said at a December court hearing, Bloomberg recalled. Potential buyers separately were interested in other Hostess products or manufacturing plants, said Heather Lennox, an attorney for the Irving, Texas-based baker. Bloomberg further recalled that Hostess began to wind down operations in November after failing to reach an agreement with its striking bakers' union on concessions to help it emerge from its second bankruptcy. Changes in American diets led to years of declining sales while ingredient costs and labor expenses climbed, the report said. "It would be a tremendous opportunity to resurrect these legendary brands and bring them back to the consumer," Metropoulos told Bloomberg. Tom Becker, a Hostess spokesman, declined to comment on a possible bid from Metropoulos and Apollo, according to Bloomberg. The Wall Street Journal earlier reported the planned bid by the two private- equity firms. Hostess announced in a Jan. 11 statement that Flowers Foods Inc. (FLO) is the lead bidder for most of the assets of its bread- baking operations, Bloomberg said. Flowers Foods, based in Thomasville, Georgia, also agreed to serve as the lead, or stalking-horse, bidder for the company's Beefsteak bread brand for $30 million, Bloomberg said. The accord doesn't include facilities or additional assets, according to the statement. About Hostess Brands Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known for iconic brands such as Butternut, Ding Dongs, Dolly Madison, Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride, Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution centers and 570 outlets in 49 states. Hostess filed for Chapter 11 bankruptcy protection early morning on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through 12-22056) in White Plains, New York. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. The bankruptcy filing was made two years after predecessors Interstate Bakeries Corp. and its affiliates emerged from bankruptcy (Bankr. W.D. Mo. Case No. 04-45814). In the new Chapter 11 case, Hostess has hired Jones Day as bankruptcy counsel; Stinson Morrison Hecker LLP as general corporate counsel and conflicts counsel; Perella Weinberg Partners LP as investment bankers, FTI Consulting, Inc. to provide an interim treasurer and additional personnel for the Debtors, and Kurtzman Carson Consultants LLC as administrative agent. Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry Wilson, the head of turnaround and restructuring firm MAEVA Advisors, are representing the Teamsters union. Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and Bakery & Confectionery Union & Industry International Pension Fund are Jeffrey R. Freund, Esq., at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright & Jaworski L.L.P. The official committee of unsecured creditors selected New York law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom Mayer and Ken Eckstein head the legal team for the committee. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. HOSTESS BRANDS: Committee Wants Lower Breakup Fee for Flowers ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that although the Hostess Brands Inc. creditors' committee supports selling the bread business, the panel contends that $13.65 million in breakup fees is too much in return for agreement by Flowers Foods Inc. to make the opening bid at $390 million. According to the report, Flowers is offering to buy 20 bread plants, 38 depots, and brand names. A hearing is scheduled for Jan. 25 for approval of the breakup fee and other rules governing auction and sale. If the judge agrees with Hostess' proposal, other bids to compete with Flowers will be due Feb. 25, followed by an auction on Feb. 28 and a hearing to approve sale on March 5. The committee, in papers filed this week with the U.S. Bankruptcy Court in White Plains, New York, argues that the breakup fee, payable if Flowers is outbid at auction, should be reduced to $10.81 million. The lower amount, according to the committee, "is more in line with the market for a transaction of this size." Flowers' requested breakup fee is 3.5%. According to the report, the committee also objects to a most- favored-nations clause contained in the breakup fee. Assuming the court approves, Flowers would receive a larger breakup fee if the bankruptcy judge in a later sale allows a fee of more than 3.5%, perhaps when the cake business is sold. The committee contends the breakup fee is too large in part because a competing bidder would be compelled to make an offer almost $20 million more than the Flowers bid to satisfy proposed auction rules. About Hostess Brands Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known for iconic brands such as Butternut, Ding Dongs, Dolly Madison, Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride, Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution centers and 570 outlets in 49 states. Hostess filed for Chapter 11 bankruptcy protection early morning on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through 12-22056) in White Plains, New York. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. The bankruptcy filing was made two years after predecessors Interstate Bakeries Corp. and its affiliates emerged from bankruptcy (Bankr. W.D. Mo. Case No. 04-45814). In the new Chapter 11 case, Hostess has hired Jones Day as bankruptcy counsel; Stinson Morrison Hecker LLP as general corporate counsel and conflicts counsel; Perella Weinberg Partners LP as investment bankers, FTI Consulting, Inc. to provide an interim treasurer and additional personnel for the Debtors, and Kurtzman Carson Consultants LLC as administrative agent. Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry Wilson, the head of turnaround and restructuring firm MAEVA Advisors, are representing the Teamsters union. Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and Bakery & Confectionery Union & Industry International Pension Fund are Jeffrey R. Freund, Esq., at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright & Jaworski L.L.P. The official committee of unsecured creditors selected New York law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom Mayer and Ken Eckstein head the legal team for the committee. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. HOSTESS BRANDS: Retiree Committee Taps Pedersen & Houpt as Counsel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of New York will convene a hearing on Jan. 25, 2013, at 10 a.m., to consider the request to employ Pedersen & Houpt as counsel for the Official Committee of Retired Employees in the Chapter 11 cases of Hostess Brands, Inc., et al. P&H will, among other things: a. counsel the Retiree Committee with respect to the administration of the bankruptcy estates, advising the Retiree Committee members with respect to their fiduciary duties, communications with the retiree constituency and the like; b. investigate the acts, conduct, assets, liabilities and financial condition of the Debtors and the Debtors' non- debtor affiliates, and any other matters relevant to the case or to the formulation of a plan of liquidation; and c. analyze any proposals made by the Debtors with respect to their assertions as to the necessity and/or extent of reduction of retiree benefits and developing counteroffers to such proposals. The hourly rates of P&H's personnel are: Partners $360 - $600 Associates $210 - $320 Legal Assistants/Paralegals: $130 - $200 To the best of the Debtors' knowledge, P&H is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Hostess Brands Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known for iconic brands such as Butternut, Ding Dongs, Dolly Madison, Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride, Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution centers and 570 outlets in 49 states. Hostess filed for Chapter 11 bankruptcy protection early morning on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through 12-22056) in White Plains, New York. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. The bankruptcy filing was made two years after predecessors Interstate Bakeries Corp. and its affiliates emerged from bankruptcy (Bankr. W.D. Mo. Case No. 04-45814). In the new Chapter 11 case, Hostess has hired Jones Day as bankruptcy counsel; Stinson Morrison Hecker LLP as general corporate counsel and conflicts counsel; Perella Weinberg Partners LP as investment bankers, FTI Consulting, Inc. to provide an interim treasurer and additional personnel for the Debtors, and Kurtzman Carson Consultants LLC as administrative agent. Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry Wilson, the head of turnaround and restructuring firm MAEVA Advisors, are representing the Teamsters union. Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and Bakery & Confectionery Union & Industry International Pension Fund are Jeffrey R. Freund, Esq., at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright & Jaworski L.L.P. The official committee of unsecured creditors selected New York law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom Mayer and Ken Eckstein head the legal team for the committee. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. HOWREY LLP: Ex-Workers Win Class Certification in WARN Act Case --------------------------------------------------------------- Helen Christophi of BankruptcyLaw360 reported that a California bankruptcy judge on Friday certified a class of former Howrey LLP employees and appointed class representatives and counsel in a suit alleging the law firm didn't give employees adequate notice before it laid them off. U.S. Bankruptcy Judge Dennis Montali appointed Los Angeles-based Blum Collins LLP as class counsel and named former Howrey employees Gail Adams and Rami Dalal as class representatives, passing over Outten & Golden LLP and its client Stephanie Langley, the report related. About Howrey LLP Three creditors filed an involuntary Chapter 7 petition (Bankr. N.D. Calif. Case No. 11-31376) on April 11, 2011, against the remnants of the Washington-based law firm Howrey LLP. The filing was in San Francisco, where the firm had an office. The firm previously was known as Howrey & Simon and Howrey Simon Arnold & White LLP. The firm at one time had more than 700 lawyers in 17 offices. The partners voted to dissolve in March 2011. The firm specialized in antitrust and intellectual-property matters. The three creditors filing the involuntary petition together have $36,600 in claims, according to their petition. The involuntary chapter 7 petition was converted to a chapter 11 case in June 2011 at the request of the firm. In its schedules filed in July, the Debtor disclosed assets of $138.7 million and liabilities of $107.0 million. Representing Citibank, the firm's largest creditor, is Kelley Cornish, Esq., a partner at Paul, Weiss, Rifkind, Wharton & Garrison. Representing Howrey is H. Jason Gold, Esq., a partner at Wiley Rein. The Official Committee of Unsecured Creditors is represented in the case by Bradford F. Englander, Esq., at Whiteford, Taylor And Preston LLP. In September 2011, Citibank sought conversion of the Debtor's case to Chapter 7 or, in the alternative, appointment of a Chapter 11 Trustee. The Court entered an order appointing a Chapter 11 Trustee. In October 2011, Allan B. Diamond was named as Trustee. ICEWEB INC: Offering 55 Million Shares Under 2012 Equity Plan ------------------------------------------------------------- IceWeb Inc. filed a Form S-8 with the U.S. Securities and Exchange Commission to regist 55 million shares of common stock issuable under the Company's 2012 Equity Compensation Plan at a proposed maximum offering price of $2.99 million. A copy of the filing is available for free at http://is.gd/nnLZVR About IceWEB Sterling, Va.-based IceWEB, Inc., manufactures and markets purpose-built appliances, network and cloud-attached storage solutions and delivers on-line cloud computing application services. The Company's customer base includes U.S. government agencies, enterprise companies, and small to medium sized businesses (SMB). D'Arelli Pruzansky, P.A., in Boca Raton, Florida, expressed substantial doubt about IceWEB's ability to continue as a going concern. The independent auditors noted that the Company had net losses of $6,485,048 for the year ended Sept. 30, 2012. The Company reported a net loss of $6.5 million on $2.6 million of sales in fiscal 2012, compared with a net loss of $4.7 million on $2.7 million of sales in fiscal 2011. The Company's balance sheet at Sept. 30, 2012, showed $2.1 million in total assets, $4.1 million in total current liabilities, and a shareholders' deficit of $2.0 million. INSPIRATION BIOPHARMA: Baxter Agrees to Acquire OBI-1 Rights ------------------------------------------------------------ Ipsen and Inspiration Biopharmaceuticals Inc. on Jan. 24 disclosed that they entered into an Asset Purchase Agreement (APA) whereby Baxter International agrees to acquire the worldwide rights to OBI-1, a recombinant porcine factor VIII (rpFVIII) in development for congenital hemophilia A with inhibitors and acquired hemophilia A, and Ipsen's industrial facility in Milford (Boston, MA). The APA was filed on Jan. 23 with the US Federal Bankruptcy Court in Boston (MA). The sale is a result of joint marketing and sale process pursued by Ipsen and Inspiration shortly after Inspiration filed for protection under Chapter 11 of the U.S. Bankruptcy Code on October 30, 2012. Ipsen has been providing Inspiration with Debtor-in-Possession financing (DIP) for an amount of up to $18.3 million in order to permit the sale process to proceed. Under the terms of the APA, Baxter has agreed to pay $50 million upfront, up to $135 million in potential additional development and commercial milestones as well as tiered net sales payments ranging from 12.5% to 17.5% of OBI-1 annual net sales. The APA is subject to certain closing conditions, including Bankruptcy Court and regulatory approvals. Ipsen has agreed to extend the DIP to Inspiration for a period of 45 days i.e. for an additional amount of up to c. $5 million. The sale process for IB1001, a recombinant factor IX (rFIX) for the treatment and prevention of bleeding in patients with hemophilia B is separate and in the final bidding stage. As Inspiration's only senior secured creditor and as the owner of non-Inspiration assets that will be included in the sale of both OBI-1 and IB1001, Ipsen will receive approximately 60% of the upfront payments. Over and above these upfront amounts, Ipsen will receive 80% of all payments up to a present value of $304 million and 50% of all proceeds thereafter. On the basis of available information, the share of upfront payment to be received by Ipsen should mainly cover the total amount of DIP financing provided to Inspiration. The remaining portion of proceeds is contingent on OBI-1's approval. As a consequence, the Group, as of December 31, 2012, may impair hemophilia related assets (mainly composed of the convertible bonds and the Milford manufacturing site) for a total amount of around EUR100 million after tax. Evercore Partners served as exclusive financial advisor to Inspiration and Ipsen on the transaction. Product Portfolio In January 2010, Inspiration entered into a strategic agreement with Ipsen, leveraging the combined expertise and resources of the two companies, to develop a broad portfolio of hemophilia products and two products in phase III. IB1001, an investigational intravenous recombinant factor IX (rFIX) therapy for the treatment and prevention of bleeding episodes in people with hemophilia B and OBI-1 an investigational intravenous recombinant porcine factor VIII (rpFVIII) therapy for the treatment of patients with i) acquired hemophilia A and ii) congenital hemophilia A who have developed inhibitors against human FVIII. In August 2011, Ipsen and Inspiration announced the extension of their agreement to create a hemophilia business unit structure that will act as the exclusive sales organization for all hemophilia products commercialized under the Inspiration brand in Europe. In July 2012 Inspiration announced that IB1001 was placed on clinical hold by the Food and Drug Administration (FDA). On August 21, 2012, Ipsen and Inspiration renegotiated their 2010 partnership. This agreement aimed to establish an effective structure whereby Ipsen gained commercial rights in key territories. Inspiration remains responsible for the world-wide development of OBI-1 and IB1001. Ipsen paid a bridging facility for an amount of $30 million providing both Inspiration with time to secure independent third party financing and Ipsen with time to assess potential ways forward. On August 31, 2012, Ipsen paid Inspiration $7.5 million and received a warrant for 15% of Inspiration's equity. Ipsen had agreed to pay Inspiration an additional $12.5 million if Inspiration had raised third party financing by the contractual deadline of 30 September 2012. Inspiration did not manage to raise external funding by this contractual deadline. On October 30, 2012, Inspiration commenced a voluntary reorganization case pursuant to Chapter 11's provisions of the United States Bankruptcy Code with the objective of leading a joint marketing and sales process. Ipsen is seeking to exit hemophilia through this process. On Jan. 24, Ipsen and Inspiration announced that they had entered into an Asset Purchase Agreement for the sale of OBI-1 to Baxter subject to closing conditions, including Bankruptcy Court and antitrust approvals. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMA: Sale to Baxter Has $50MM Upfront Payment --------------------------------------------------------------- Inspiration Biopharmaceuticals and Ipsen on Jan. 24 announced the sale of its lead hemophilia program, OBI-1 (recombinant porcine factor VIII), to Baxter International (Baxter), the global leader in hemophilia. Baxter will acquire worldwide rights to OBI-1, a recombinant porcine factor VIII in development for congenital hemophilia A with inhibitors and acquired hemophilia A. OBI-1 is currently in a pivotal trial for the treatment of individuals with acquired hemophilia A. Inspiration and Ipsen have signed an asset purchase agreement pursuant to which Baxter would acquire the worldwide rights to OBI-1, as well as Ipsen's manufacturing facility for OBI-1 in Milford, Massachusetts. The total aggregate consideration for these rights may exceed $700 million, including the upfront payment of $50 million, development and sales milestones totaling $135 million and annual net sales payments equivalent to a tiered double digit percentage of global net sales. "Inspiration was founded by families who are personally affected by hemophilia, so bringing innovative therapies to patients has always been at the core of our mission" commented John P. Butler, Chief Executive Officer of Inspiration. "Baxter has a long commitment to hemophilia and we are excited that they will be using their expertise to bring this innovative therapy to people who currently have limited treatment options." The asset purchase agreement was filed on Jan. 23, with the United States Bankruptcy Court in Boston. The sale is a result of a joint sale process pursued by Inspiration and Ipsen shortly after Inspiration filed for protection under Chapter 11 of the U.S. Bankruptcy Code on October 30, 2012. Ipsen has been providing Inspiration with Debtor-in-Possession (DIP) financing to fund Inspiration's operations and the sale process. The sale is subject to certain closing conditions, including Bankruptcy Court and regulatory approvals. Inspiration and Ipsen are in the final bidding stages of the sale process for IB1001, a recombinant factor IX that is currently under regulatory review in the US and Europe. Evercore Partners served as exclusive financial advisor to Inspiration and Ipsen on the transaction. Ropes & Gray served as legal advisor to Inspiration on the transaction. Murphy & King is Inspiration's bankruptcy counsel and FTI Consulting, Inc. is Chief Restructuring Officer for Inspiration. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMA: Baxter Sees Value in OBI-1 Assets -------------------------------------------------------- Baxter International Inc. on Jan. 24 disclosed that it has agreed to acquire the investigational hemophilia compound OBI-1 and related assets from Inspiration BioPharmaceuticals, Inc. as well as certain other OBI-1 related assets, including manufacturing operations, from Ipsen Pharma S.A.S. in conjunction with Inspiration's ongoing bankruptcy proceedings. The transaction is subject to bankruptcy court and regulatory approvals. OBI-1 is a recombinant porcine factor VIII (rpFVIII) being investigated for the treatment of bleeding in people with acquired hemophilia A and congenital hemophilia A patients with inhibitors. Acquired hemophilia A is a rare, potentially life-threatening bleeding disorder, which, unlike congenital hemophilia, typically affects older adults and occurs equally in both males and females. "OBI-1 has the potential to address existing unmet needs of hemophilia patients and is a strong strategic fit with Baxter's current hemophilia portfolio," said Bruce Ewenstein, M.D., Ph.D., vice president of clinical affairs in Baxter's BioScience business. Under the terms of the agreement, Baxter will make an upfront payment of $50 million for the OBI-1 assets, including the manufacturing operations. In the future, Baxter may make payments of up to $20 million in total based on regulatory approval of the acquired hemophilia A indication in the United States and first additional country. Additional amounts may be paid upon approval of additional indications, through net sales payments, and as sales milestones when sales exceed $100 million. OBI-1 is currently in Phase III clinical studies in individuals with acquired hemophilia A and those with congenital hemophilia A who have developed inhibitors against human FVIII. OBI-1 received orphan drug designation in the United States and Europe, and was recently granted fast track designation for acquired hemophilia A by the United States Food and Drug Administration (FDA). About Acquired Hemophilia A Acquired hemophilia A is a very rare (estimated annual incidence of 1.5 cases per million lives) and potentially life-threatening acute bleeding disorder caused by the development of autoantibodies (inhibitors) against coagulation FVIII. In acquired hemophilia A, individuals typically experience soft tissue or post-procedural bleeding, in contrast to bleeding into joints, which is more typical in congenital hemophilia. About Baxter in Hemophilia Baxter has more than 60 years experience in hemophilia and has introduced a number of therapeutic firsts for hemophilia patients. Baxter has the broadest portfolio of hemophilia treatments in the industry and is able to meet individual therapy choices, providing a range of options at each treatment stage. The company's work is focused on optimizing hemophilia care and improving the lives of people living with hemophilia A and B worldwide. About Baxter International Inc. Baxter International Inc., through its subsidiaries, develops, manufactures and markets products that save and sustain the lives of people with hemophilia, immune disorders, cancer, infectious diseases, kidney disease, trauma and other chronic and acute medical conditions. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. JACOBS FINANCIAL: Incurs $632,000 Net Loss in Nov. 30 Quarter ------------------------------------------------------------- Jacobs Financial Group, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $632,320 on $340,542 of total revenues for the three months ended Nov. 30, 2012, compared with a net loss of $459,458 on $324,111 of total revenues for the same period during the prior year. For the six months ended Nov. 30, 2012, the Company incurred a net loss of $1.08 million on $724,919 of total revenues, compared with a net loss of $586,499 on $980,875 of total revenues for the same period a year ago. The Company's balance sheet at Nov. 30, 2012, showed $8.75 million in total assets, $16.80 million in total liabilities, $1.87 million in total mandatorily redeemable convertible preferred stock, and a $9.92 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/2TFbaH About Jacobs Financial Jacobs Financial Group, Inc. (OTC Bulletin Board: JFGI) is a Charleston, West Virginia-based holding company for First Surety Corporation, a West Virginia domiciled surety, Triangle Surety Agency, an insurance agency that specializes in coal reclamation surety bonds, and Jacobs & Company, a registered investment advisor. Jacobs Financial reported a net loss of $1.10 million for the year ended May 31, 2012, compared with a net loss of $1.30 million during the prior fiscal year. In the auditors' report accompanying the consolidated financial statements for the year ended May 31, 2012, Malin, Bergquist & Company, LLP, in Pittsburgh, PA, noted that the Company's significant net working capital deficit and operating losses raise substantial doubt about its ability to continue as a going concern. KINGSBURY CORP: Has Deal With TD Bank, Can Use Cash --------------------------------------------------- The U.S. Bankruptcy Court for the District of New Hampshire signed a stipulation authorizing Kingsbury Corporation, et al.'s use of TD Bank, N.A.'s cash collateral. The stipulation resolves any potential issues regarding the allocation of the sale proceeds, compensation owed to GA Keen and TD Bank's rights under Iris Mitropoulis' guarantee. Since many of the potential areas for dispute are resolved proactively by the stipulation, the proposed sale process, and subsequent distribution of resulting proceeds, will be efficient and clear of obstacles. Prepetition, the Debtors' operations were principally financed by TD Bank, Utica Leaseco, LLC, Diamond Business Credit, LLC, and the U.S. Small Business Administration. Pursuant to the stipulation, among other things: -- TD Bank's claim is allowed in the amount of $928,505 as of the date of the filing of the Debtor's bankruptcy petition; in the event that value of the estate's property securing that claim is greater than such allowed amount, TD Bank's rights to assert, by appropriate paper, any claimed entitlement to postpetition interest, costs or attorney's fees is reserved; and -- TD Bank's claim will be paid in an amount of up to $928,505, or other amount as determined by further order of this Court. About Kingsbury Corp. Kingsbury Corp. -- http://www.kingsburycorp.com/-- makes and assembles machine systems. Kingsbury and affiliate Ventura Industries, LLC, filed Chapter 11 petition (Bankr. D. N.H. Case Nos. 11-13671 and 11-13687) on Sept. 30, 2011. Jennifer Rood, Esq., and Robert J. Keach, Esq., at Berstein, Shur, Sawyer & Nelson, serve as counsel to the Debtors. Donnelly Penman & Partners serves as its investment banker. In its schedules, the Debtor disclosed $10,134,679 in assets, and $24,534,973 in liabilities as of the petition date. William K. Harrington, the U.S. Trustee for Region 1, appointed five members to serve on the Official Committee of Unsecured Creditors. LCI HOLDING: Wins Final OK to Access Cash Collateral, DIP Loan -------------------------------------------------------------- Bankruptcy Judge Kevin Gross on Jan. 23 entered a final order authorizing the LifeCare Hospitals to obtain DIP financing and use cash collateral of the prepetition lenders. As reported in the Dec. 14, 2012 edition of the TCR, certain of the prepetition lenders, led by JPMorgan Chase Bank, N.A., as DIP agent, have agreed to provide: (i) a senior secured first priority delayed draw term loan facility in an amount of $15 million; and a (ii) senior secured first priority revolving facility in the amount of $10 million. The term loan facility and revolving facility will mature in six months or earlier, if milestones are not achieved. The Debtor will pay a $250,000 work fee to the DIP Agent upon entry of the cash collateral order. The terms of the DIP financing require a quick sale of the assets. Hospital Acquisition LLC, the entity formed by the secured lenders, will be the stalking horse bidder at the auction slated for March. The Debtors said that options for postpetition financing were significantly limited by the prepetition lenders' liens on substantially all of the assets. The Jan. 23 order also allows the Debtors to use the prepetition lenders' cash collateral. The lenders will receive replacement liens, 11 U.S.C. Sec. 507(b) claims, payment of accrued and unpaid interest and reimbursement of expenses, as adequate protection. Interim approval of the DIP financing was granted in December. The Official Committee of Unsecured Creditors raised objections to the terms of the DIP financing. According to the Committee, the Debtors and the prepetition lenders have orchestrated a postpetition financing facility that will leave the Debtors' estates administratively insolvent, encumber all unencumbered assets, and hand substantially all of the Debtors' assets to the prepetition lenders through an 11 U.S.C. Sec. 363 sale designed into the onerous terms of the DIP facility. The Committee notes that, among other things: -- the DIP facility is proposed as a $25 million credit facility -- a $15 million term loan that the Debtors' budget shows is never drawn upon, and a $10 million revolver that is roll-up of existing letters of credit issued by the prepetition lenders; -- the DIP facility binds each of the Debtors as guarantors of the debt, even those that are not currently indebted to the prepetition lenders; and -- the DIP Facility commits the Debtors' unencumbered cash towards funding a sale process that will benefit on the prepetition lenders, provides nothing for the unsecured creditors, and leaves estates administratively insolvent. DIP Loans Intertwined With Sale The salient terms of the DIP facility includes: Borrower: LifeCare Holdings, Inc. Guarantors: LCI and each of LifeCare's direct and indirect subsidiaries. The guarantors would include Debtors that are not currently indebted under the Prepetition Credit Agreement. DIP Agent: JPMorgan Chase Bank, N.A. DIP Lenders: Certain of the Prepetition Lenders. Commitment: (i) $15 million delayed draw term loan facility and (ii) $10 million revolving facility solely for issuance of letters of credit that will be used to cash collateralize existing letters of credit under the Prepetition Credit Agreement. Maturity: The earliest of (a) six months after the Petition Date (with an automatic 90 day extension to obtain any necessary regulatory approvals); (b) acceleration of obligations under the DIP facility; or (c) closing of a sale of all or substantially all assets. Interest Rate: At the option of the Debtors: (i) ABR (as defined in term sheet) plus Applicable Margin, or (ii) the Eurodollar Rate plus the Applicable Margin. The interest rate on the revolver will exceed 10% per annum. Fees: An upfront fee of 3.00% on the term loan ($450,000) and 0.50% on the revolving facility ($50,000) (notwithstanding that the letters of credit at issue are already outstanding), an unused availability fee of 2.50% on the term loan and 0.50% on the revolving facility, and a letter of credit fronting fee (0.125%) (also notwithstanding that the letters of credit at issue are already outstanding). The aggregate projected expense of the DIP Facility is over $1.2 million, inclusive of interest, for no new projected borrowings. DIP Liens and superpriority claims: Senior, priming DIP Liens and superpriority claims in favor of the DIP Lenders on substantially all of the Debtors' assets. Roll-Up: The DIP Facility contains a "roll-up" of the approximately $10 million in outstanding letters of credit issued under the First Lien Credit Facility. Credit Bidding: The DIP Lenders and the Prepetition Lenders will have the right to credit bid their claims during the sale of all or substantially all of the Debtors' assets. Carve-Out: (a) all accrued and unpaid professional fees pursuant to a budget prior to a carve-out event; and (b) $1,500,000 of accrued and unpaid professional fees after the occurrence of a carve-out event. Only $50,000 of the carve-out can be used to fund a Committee investigation of the liens and claims of the Prepetition Lenders. Milestones: (a) entry of a sale procedures order by Jan. 11, 2013; (b) commence auction (if necessary) by March 5, 2013; (c) entry of an order approving the sale by March 14, 2013; and (d) occurrence of the closing date of the sale within 120 days after entry of the sale order, subject to extension for regulatory requirements. About LifeCare LCI Holding Company, Inc., and its affiliates, doing business as LifeCare Hospitals, operate eight "hospital within hospital" facilities and 19 freestanding facilities in 10 states. The hospitals have about 1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio and Nevada. LifeCare is controlled by Carlyle Group, which holds 93.4 percent of the stock following a $570 million acquisition in August 2005. LCI Holding Company, Inc., and its affiliates, including LifeCare Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13319) on Dec. 11, 2012, with plans to sell assets to secured lenders. Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps, Slate Meagher & Flom LLP, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Huron Management Services LLC will provide the Debtors an interim chief financial officer and certain additional personnel; and (ii) designate Stuart Walker as interim chief financial officer. The steering committee of lenders is represented by attorneys at Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent under the prepetition and postpetition secured credit facility is represented by Simpson Thacher & Barlett LLP. The Debtors disclosed assets of $422 million and liabilities totaling $575.9 million as of Sept. 30, 2012. As of the bankruptcy filing, total long-term obligations were $482.2 million consisting of, among other things, institutional loans and unsecured subordinated loans. A total of $353.4 million is owing under the prepetition secured credit facility. A total of $128.4 million is owing on senior subordinated notes. LifeCare Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed $24,028,730 in assets and $484,372,539 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves as its financial advisor. LCI HOLDING: Committee Taps FTI Consulting as Financial Advisor --------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 case of LCI Holding Company, Inc., et al., asks the U.S. Bankruptcy Court for the District of Delaware for permission to retain FTI Consulting, Inc., as its financial advisor. The Committee needs the services of FTI to assess and monitor the efforts of the Debtors and their professional advisors to maximize the value of their assets. The hourly rates of FTI's personnel are: Senior Managing Directors $790 - $895 Directors/Managing Directors $570 - $755 Consultants/Senior Consultants $290 - $540 Administrative/Paraprofessionals/ Associates $120 - $235 Steven Simms, senior managing director with FTI, assures the Court that the firm does not hold or represent any interest adverse to the estate. A hearing on Feb. 8, 2013, at 2 p.m., has been set. Objections, if any, are due Feb. 1. About LifeCare LCI Holding Company, Inc., and its affiliates, doing business as LifeCare Hospitals, operate eight "hospital within hospital" facilities and 19 freestanding facilities in 10 states. The hospitals have about 1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio and Nevada. LifeCare is controlled by Carlyle Group, which holds 93.4 percent of the stock following a $570 million acquisition in August 2005. LCI Holding Company, Inc., and its affiliates, including LifeCare Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13319) on Dec. 11, 2012, with plans to sell assets to secured lenders. Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps, Slate Meagher & Flom LLP, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Huron Management Services LLC will provide the Debtors an interim chief financial officer and certain additional personnel; and (ii) designate Stuart Walker as interim chief financial officer. The steering committee of lenders is represented by attorneys at Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent under the prepetition and postpetition secured credit facility is represented by Simpson Thacher & Barlett LLP. The Debtors disclosed assets of $422 million and liabilities totaling $575.9 million as of Sept. 30, 2012. As of the bankruptcy filing, total long-term obligations were $482.2 million consisting of, among other things, institutional loans and unsecured subordinated loans. A total of $353.4 million is owing under the prepetition secured credit facility. A total of $128.4 million is owing on senior subordinated notes. LifeCare Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed $24,028,730 in assets and $484,372,539 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves as its financial advisor. LCI HOLDING: Files Schedules of Assets and Liabilities ------------------------------------------------------- LCI Holding Company, Inc., and its affiliates filed their respective schedules, disclosing: Company Assets Liabilities ------- ------ ----------- LifeCare Hospitals of Pittsburgh, LLC $24,028,730 $484,372,539 Boise Intensive Care Hospital, Inc. $22,061,478 $3,082,600 LifeCare Holdings, Inc. $20,714,225 $485,252,994 LifeCare Hospitals of N. Texas, L.P. $19,464,521 $487,672,271 LifeCare Investments 2, LLC $18,277,576 $0 LifeCare Management Services, L.L.C. $14,379,343 $483,109,450 San Antonio Specialty Hospital, Ltd. $9,853,979 $484,124,156 LifeCare Hospitals, LLC $8,169,228 $484,961,018 LifeCare Hospitals of South Texas, Inc. $7,933,376 $483,499,116 LifeCare Hospitals of N. Nevada, Inc. $7,050,240 $483,228,248 NextCARE Specialty H. of Denver, Inc. $6,930,741 $483,557,125 LifeCare Hospitals of Dayton, Inc. $6,000,259 $484,178,110 LifeCare Hospitals of Milwaukee, Inc. $5,722,216 $483,881,887 LifeCare Hosp. of Chester County, Inc. $5,365,476 $483,247,963 LifeCare Hospital at Tenaya, LLC $5,267,058 $483,287,721 LifeCare Hospitals of Sarasota, LLC $4,777,494 $483,008,385 LifeCare Hospitals of N.C., , L.L.C. $4,654,159 $483,229,275 LifeCare Spec. H. of N. Louisiana, LLC $3,416,587 $483,071,718 LifeCare Hosp. of Mechanicsburg, LLC $2,982,030 $483,224,190 LifeCare REIT 1, Inc. $999,101 $482,744,413 LifeCare REIT 2, Inc. $162,916 $482,744,413 Pittsburgh Specialty Hospital, LLC $7,378 $482,744,413 LCI Holdco, LLC $0 $354,638,931 CareRehab Services, L.L.C. $0 $128,105,482 LifeCare Holding Company of Texas, LLC $0 $482,744,413 Crescent City Hospitals, L.L.C $0 $482,744,413 LifeCare Hospitals of New Orleans, L.L.C. $0 $482,744,413 LifeCare Hospitals of Fort Worth, L.P. $0 $482,744,413 NextCARE Hospitals/Muskegon, Inc. $0 $482,744,413 LifeCare Investments, L.L.C. $0 $482,744,413 LifeCare Hospitals of San Antonio, LLC $0 $0 LCI Holding Company, Inc. $0 $0 LCI Healthcare Holdings, Inc. $0 $0 LCI Intermediate Holdco, Inc. $0 $0 LifeCare Ambulatory Surgery Center, Inc. $0 $0 LifeCare Hospitals of Pittsburgh, the Debtor with the largest assets, disclosed these figures in its schedules: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $6,177,011 B. Personal Property $17,851,719 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $354,638,931 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $129,733,608 ----------- ----------- TOTAL $24,028,730 $484,372,539 Copies of the schedules of the top five largest debtors are available for free at: http://bankrupt.com/misc/LCI_HOLDING_pittsburgh_sal.pdf http://bankrupt.com/misc/LCI_HOLDING_boise_sal.pdf http://bankrupt.com/misc/LCI_HOLDING_lifecareholdings_sal.pdf http://bankrupt.com/misc/LCI_HOLDING_lifecarehospitalsnt_sal.pdf http://bankrupt.com/misc/LCI_HOLDING_lifecareinvestmentsb_sal.pdf About LifeCare LCI Holding Company, Inc., and its affiliates, doing business as LifeCare Hospitals, operate eight "hospital within hospital" facilities and 19 freestanding facilities in 10 states. The hospitals have about 1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio and Nevada. LifeCare is controlled by Carlyle Group, which holds 93.4 percent of the stock following a $570 million acquisition in August 2005. LCI Holding Company, Inc., and its affiliates, including LifeCare Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13319) on Dec. 11, 2012, with plans to sell assets to secured lenders. Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps, Slate Meagher & Flom LLP, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Huron Management Services LLC will provide the Debtors an interim chief financial officer and certain additional personnel; and (ii) designate Stuart Walker as interim chief financial officer. The steering committee of lenders is represented by attorneys at Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent under the prepetition and postpetition secured credit facility is represented by Simpson Thacher & Barlett LLP. The Debtors disclosed assets of $422 million and liabilities totaling $575.9 million as of Sept. 30, 2012. As of the bankruptcy filing, total long-term obligations were $482.2 million consisting of, among other things, institutional loans and unsecured subordinated loans. A total of $353.4 million is owing under the prepetition secured credit facility. A total of $128.4 million is owing on senior subordinated notes. LifeCare Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed $24,028,730 in assets and $484,372,539 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves as its financial advisor. LDK SOLAR: Has $31 Million Securities Purchase Pact with Fulai -------------------------------------------------------------- LDK Solar Co., Ltd., has entered into a share purchase agreement dated Jan. 21, 2013, with Fulai Investments Limited, which has agreed to purchase 17,000,000 newly issued ordinary shares of LDK Solar at a purchase price of US$1.83 per share with an aggregate purchase price of US$31,110,000, subject to the terms and conditions of the share purchase agreement, including a lock-up for 180 days from the closing date of the contemplated transactions. Pursuant to the share purchase agreement, the parties will endeavor to fulfill the closing conditions to consummate the transactions prior to Feb. 28, 2013. Fulai Investments also has the right to designate two non-executive directors to the LDK Solar board upon consummation of the transactions. The net proceeds will be used for general corporate purposes in LDK Solar's operations. About LDK Solar LDK Solar Co., Ltd. -- http://www.ldksolar.com-- based in Hi- Tech Industrial Park, Xinyu City, Jiangxi Province, People's Republic of China, is a vertically integrated manufacturer of photovoltaic products, including high-quality and low-cost polysilicon, solar wafers, cells, modules, systems, power projects and solutions. LDK Solar was incorporated in the Cayman Islands on May 1, 2006, by LDK New Energy, a British Virgin Islands company wholly owned by Xiaofeng Peng, LDK's founder, chairman and chief executive officer, to acquire all of the equity interests in Jiangxi LDK Solar from Suzhou Liouxin Industry Co., Ltd., and Liouxin Industrial Limited. KPMG in Hong Kong, China, said in a May 15, 2012, audit report, there is substantial doubt on the ability of LDK Solar Co., Ltd., to continue as a going concern. According to KPMG, LDK Solar has a net working capital deficit and is restricted to incur additional debt as it has not met a financial covenant ratio under a long-term debt agreement as of Dec. 31, 2011. These conditions raise substantial doubt about the Group's ability to continue as a going concern. LDK Solar's balance sheet at Sept. 30, 2012, showed US$5.76 billion in total assets, US$5.41 billion in total liabilities, US$299.02 million in redeemable non-controlling interests and US$45.91 million in total equity. LEHMAN BROTHERS: Investors Win Class Cert. vs. Ernst & Young, UBS ----------------------------------------------------------------- Helen Christophi of BankruptcyLaw360 reported that a New York federal judge on Wednesday approved most of a bid for certification of an investor class action against former officials and auditors of Lehman Brothers Holdings Inc. in multidistrict litigation over the bankrupt company's securities offerings. U.S. District Judge Lewis A. Kaplan denied Ernst & Young LLP and UBS Financial Services Inc.'s motion to dismiss the certification bid of two classes pursuing claims against the accounting firm and the investment bank, holding both groups satisfied the criteria for class status, the report related. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. Lehman made its first payment of $22.5 billion to creditors in April 2012 and a second payment of $10.2 billion on Oct. 1. A third distribution is set for around March 30, 2013. The brokerage is yet to make a first distribution to non-customers. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LIGHTSQUARED INC: Wants Until May 31 to Propose Chapter 11 Plan --------------------------------------------------------------- Lightsquared Inc., et al., ask the U.S. Bankruptcy Court for the Southern District of New York to further extend their exclusive periods to propose a plan of reorganization until May 31, 2013, and solicit acceptances for that plan until July 30, respectively. A Jan. 31, hearing at 10 a.m. has been set. Objections, if any, are due Jan. 24, at 4 p.m. According to the Debtors, -- Pursuant to the 2010 FCC Change of Control Order, they were subject to certain network build-out and coverage milestones requiring, among other things, that they construct a terrestrial broadband network capable of providing coverage to at least 100 million Americans by Dec. 31, 2012. -- At the time the Chapter 11 cases were initiated, the only "solution" to the GPS concerns that formally had been proposed was to indefinitely suspend the FCC authorizations on which the Debtor's terrestrial broadband network is premised. -- The Debtor has made substantial and tangible progress on a regulatory resolution that will permit it to deploy a 4G terrestrial wireless network. About LightSquared Inc. LightSquared Inc. and 19 of its affiliates filed Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on May 14, 2012, as the Company seeks to resolve regulatory issues that have prevented it from building its coast-to-coast integrated satellite 4G wireless network. LightSquared had invested more than $4 billion to deploy an integrated satellite-terrestrial network. In February 2012, however, the U.S. Federal Communications Commission told LightSquared the agency would revoke a license to build out the network as it would interfere with global positioning systems used by the military and various industries. In March 2012, the Company's partner, Sprint, canceled a master services agreement. LightSquared's lenders deemed the termination of the Sprint agreement would trigger cross-defaults under LightSquared's prepetition credit agreements. LightSquared and its prepetition lenders attempted to negotiate a global restructuring that would provide LightSquared with liquidity and runway necessary to resolve its issues with the FCC. Despite working diligently and in good faith, however, LightSquared and the lenders were not able to consummate a global restructuring on terms acceptable to all interested parties. LONG ISLAND NATIONAL: GA Keen Conducts Bankruptcy Sale Process -------------------------------------------------------------- GA Keen Realty Advisors, a division of Great American Group, Inc., is selling the Long Island National Golf Club in Riverhead, New York through a bankruptcy sale process. Located at 1793 Northville Turnpike, in the heart of Long Island's east end wine country and minutes from the world-famous "Hamptons", the public golf club is best known for its links-style design created by renowned golf course architect Robert Trent Jones, Jr. The 150 acre site is also suitable for residential development pursuant to its current zoning designation. "While many golf courses have seen revenues decline over the past few years, Long Island National Golf Club has maintained its profitability," said GA Keen Realty Advisors Co-President Matthew Bordwin. "The course's success, masterpiece design and location among scenic farmlands and vineyards make it a highly desirable purchase for buyers and investors. Further, the beauty of the Long Island's East End, specifically the North Fork's wine region, makes this a terrific residential development opportunity as well." The 6,838-yard course was created to take advantage of rolling hills, dramatic elevation changes and a spectacular mix of traditional design elements. The sale includes the 18-hole links- style course developed on a 150-acre landscaped site, along with a pro shop, grill and clubhouse with a full-service restaurant. The property and facilities are being marketed as part of a bankruptcy sale and offers are now being considered. For more information about Long Island National Golf Club, contact Craig Fox, Stacy Ferrone or Matthew Bordwin at 646-381-9222 or at cfox@greatamerican.com, sferrone@greatamerican.com or mbordwin@greatamerican.com About GA Keen Realty Advisors, LLC Located in New York, GA Keen Realty Advisors -- http://www.greatamerican.com/keen-- provides real estate analysis, valuation and strategic planning services, brokerage, M&A, auction services, lease restructuring services and real estate capital market services. For more information about GA Keen Realty Advisors, call 646-381-9222. About Great American Group, Inc. Great American Group -- http://www.greatamerican.com-- is a provider of asset disposition and auction solutions, advisory and valuation services, capital investment, and real estate advisory services for an extensive array of companies. A trusted strategic partner at every stage of the business lifecycle, Great American Group efficiently deploys resources with sector expertise to assist companies, lenders, capital providers, private equity investors and professional service firms in maximizing the value of their assets. The company has in-depth experience within the retail, industrial, real estate, healthcare, energy and technology industries. The corporate headquarters is located in Woodland Hills, Calif. with additional offices in Atlanta, Boston, Charlotte, N.C., Chicago, Dallas, New York, San Francisco and London. For more information, call 818-884-3737. LOTHIAN OIL: Fraud Committee, Grossman Lose 5th Cir. Appeal ----------------------------------------------------------- The Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman challenge adverse rulings on eight motions by the bankruptcy court for the Western District of Texas in the case of Lothian Oil, Incorporated. Finding no reversible error of fact or law, a three-judge panel of the U.S. Court of Appeals for the Fifth Circuit on Wednesday affirmed. Anti-Lothian is an unofficial group of shareholders seeking remedies for alleged fraudulent transfers of property between Lothian Oil and creditor entities headed by a company called the Belridge Group. On June 13, 2007, Lothian filed for Chapter 11 bankruptcy protection. The same day, motions were filed to approve settlement agreements between the Debtor and two creditors: Nawab Energy Partners, LP and Frio Energy Partners, LP. The agreements, approved by the bankruptcy court on July 16, 2007 -- 2007 Compromise Orders -- involved the settlement of lawsuits previously brought by Lothian to protect properties on which the Belridge Group companies were attempting to foreclose. Like an earlier group known as the Ad Hoc Committee of Series A Preferred Convertible Shareholders, the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman claim that conflicts of interest should have required invalidation of these orders, which surrendered the properties without commensurate compensation. A motion was filed by the AHC on June 10, 2008, to set aside the 2007 Compromise Orders under Bankruptcy Rule 9024. The bankruptcy plan was confirmed on June 27, 2008. The plan incorporated the settlements with Nawab and Frio but carved out AHC's right to pursue its Rule 9024 Motion. After the confirmation, most of the members of the AHC settled their claims related to the motion and the bankruptcy court entered an order approving those settlements on Dec. 12, 2008. The attorney for the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman at the time, Jessica Sokol, filed but later withdrew an objection to the settlement. On June 29, 2009, the First Anti-Lothian Bankruptcy Fraud Committee -- many Appellants, including two AHC members who did not settle -- filed the First Anti-Lothian Document challenging the 2007 Compromise Orders and requesting that the plan be set aside because of recently-discovered fraud. This document was dismissed without prejudice on Sept. 17, 2009 -- the day after the Second Anti-Lothian Document was filed by the current Appellants. Rather than asking for the Confirmed Plan to be set aside, the Second Anti-Lothian Document asked the bankruptcy court to "clarify or modify" the plan by, inter alia, setting aside the Compromise Orders and other fraudulent transfers. The bankruptcy court heard arguments on motions related to the Second Anti-Lothian Document as well as cross-motions for enforcement of the Plan against the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman and their counsel, Sokol, on Oct. 27, 2009. Motions to disgorge the Chief Restructuring Officer's fees as well as sanction professionals related to the Belridge Group and appoint an impartial trustee were also argued at that time. Sokol had been previously summoned before the bankruptcy court regarding her pro hac vice status, and motions related to that hearing were also before the court. Sokol argued a motion for acceptance of Bankruptcy Rule 2019(a) supplemental documentation and renewal of an emergency cross motion for similar compliance by opposing counsel; the original emergency cross motion that would allow her to continue her pro hac vice status after the hearing; and the original emergency cross motion seeking Rule 2019(a) compliance from opposing counsel. The bankruptcy court held against the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman and in favor of the reorganized Debtor on each motion. Sokol's previous pro hac filings were accepted but she was stopped from continuing such practice and the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman were not allowed to file further pleadings in the bankruptcy court without prior court approval. On appeal the district court ruled for the Appellees on all of the orders. Appeals of the three pro hac vice-related orders were dismissed because they were noticed out of time, and the other five orders were affirmed. The two orders that served as the primary focus of the district court opinion were related to the Second Anti-Lothian Document (with its 9024 Motion to Set Aside Settlements). Both orders were affirmed because the 9024 Motion to set aside the Compromise Orders was filed after the 180-day window available for challenging the confirmation of a bankruptcy plan under 11 U.S.C. Sec. 1144. The remaining orders were upheld based on inadequate briefing by the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman. The Circuit Court appeal followed. The Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman raise several challenges. They argued that the Second Anti- Lothian Document is not an attempt to revoke the Confirmed Plan but merely asks for a modification in which fraudulent transfers and illicit fees are returned to the estate. Also, because the plan itself made room for the initial 9024 Motion by the AHC, the current "attack" on the biased transactions at issue (the Nawab and Frio settlements) is merely in keeping with that carve-out. Any delays in the filing could be excused by newly discovered evidence about the conflicts of interest and the fact that, even if the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman are not part of the AHC (two of them were -- the MYG Trust and the Herzberg Family Trust), the Second Anti-Lothian Document's claim is "related to" those brought in the AHC 9024 Motion. Circuit Judge Edith H. Jones, who wrote the Fifth Circuit decision, said the arguments of the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman fail for multiple reasons. "To begin, the district court was correct to doubt Anti-Lothian's standing. Even if we accept the dubious proposition that the Second Anti-Lothian Document merely sought modification of the plan, only the plan's proponents or the debtor may modify a confirmed plan. . . . Anti-Lothian is neither. Permission was not sought from the bankruptcy court to bring a derivative action on the debtor's behalf . . . nor was futility claimed to excuse such failure. Anti-Lothian thus lacks the requisite standing to make a motion to modify the Confirmed Plan," said Judge Jones. "More definitively, the Second Anti-Lothian Document fails based on limitations; potential excuses for its lateness are unavailing." Judge Jones also explained that 11 U.S.C. Sec. 1144, which allows revocation of a fraudulent bankruptcy plan, requires that relief be sought within 180 days of confirmation. The one-year limit on Rule 60(b) motions provided in Bankruptcy Rule 9024 is expressly subject to the Sec. 1144 limit. "The Second Anti-Lothian Document was filed more than a year after the plan was confirmed. Treated as a motion to revoke confirmation under Sec. 1144, as the district court held, the document is plainly untimely. But even if it is a cognizable Rule 9024 motion, it was filed beyond the rules's one-year deadline. Moreover, the First Anti-Lothian Document cannot be relied on to rescue the filing date since that motion was dismissed and no appeal was filed," continued Judge Jones. The Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman ask the Appeals Court to consider excusing the normal limitations on attacking bankruptcy plans because of their recently acquired evidence concerning fraud. Though the "newness" of the Appellant's evidence is doubtful, Judge Jones said any form of tolling is precluded by the text of both potential avenues for dealing with fraud in this context. Section 1144 and Rule 9024, the latter encompassing Rule 60(b)(3), each explicitly treat fraud. It would make little sense to toll the limitations period of rules designed to deal with fraud because fraud was present. Alternatively, said Judge Jones, the carve-out in the Confirmed Plan cannot be used to bring this action for several reasons. First, the plan only preserves AHC's Rule 9024 Motion, the one in existence at the time of the confirmation. Second, while the Debtor possesses a reservation of rights related to the AHC motion, the Anti-Lothian Bankruptcy Fraud Committee and Israel Grossman do not. "Even if we were to assume that the meaning of 'related to [a specifically named motion]' in Plan [Sec.] 6.9 can be stretched to include future motions (we doubt that it should), Appellants do not have the authority to bring suit to defend the Debtor's reserved rights. The better interpretation of the plan is that the settlement of the AHC motion extinguished claims related to it," Judge Jones said. "In sum, the district court would have been on solid ground in rejecting the Second Anti-Lothian document for any number of reasons. Even if further evidence of the conflicts of interest emerged post-confirmation, there was enough in the winter of 2008 for the AHC to obtain a carve-out in the plan to pursue a 9024 Motion and ultimately a monetary settlement (favorable to Israel Grossman, among others) related to the Nawab and Frio Compromise Orders. The carve-out in the plan did not have in mind the scenario of piece-mealing of redundant 9024 claims. Once a bankruptcy plan is confirmed, Sec. 1144 sets the length of time available to challenge it -- even when fraud is involved." Judge Jones also ruled that each of the remaining orders was held to be insufficiently briefed before the district court and, therefore, abandoned. "Given the Appellants' lack of systematic attention to each of the bankruptcy court's reasons, we uphold the district court's determination. It is not the function of an appellate court -- or the district court functioning in an appellate role for the bankruptcy court -- to divine arguments on behalf of litigants from a substantial narrative; undeveloped arguments are rightly ignored. . . . Nor should this court pass on arguments that were never properly presented to the district court," the judge said. The appeal is, ANTI LOTHIAN BANKRUPTCY FRAUD COMMITTEE; ISRAEL GROSSMAN, Appellants, v. LOTHIAN OIL, INCORPORATED, Jointly Administered Member Cases Lothian Oil (USA Inc.; Lothian Oil Texas I, Inc.; Lothian Oil Texas II, Inc.; Lothian Oil Investments I, Inc.; Lothian Oil Investments II, Inc.; LeaDI JVGP, Inc.); NAWAB ENERGY PARTNERS, L.P.; FRIO ENERGY PARTNERS, LP, Appellees. No. 11-51082 (5th Cir.). A copy of the Fifth Circuit's Jan. 23 decision is available at http://is.gd/0k1k3Sfrom Leagle.com. About Lothian Oil Based in Midland, Texas, Lothian Oil Inc. was a privately owned oil and gas company. Lothian and six affiliates filed for chapter 11 protection (Bankr. W.D. Tex. Case No. 07-70121) on June 13, 2007. The Debtors were represented by lawyers at Haynes and Boone, LLP. When Lothian sought bankruptcy, it listed assets and debts between $1 million to $100 million. On June 27, 2008, the bankruptcy court confirmed a plan of liquidation. LOUISIANA RIVERBOAT: Lenders Consent to Cash Use Until March 31 --------------------------------------------------------------- Louisiana Riverboat Gaming Partnership, et al., notify the U.S. Bankruptcy Court for the Western District of Louisiana the Ad Hoc Group Of First Lien Lenders have agreed to extend the term of the cash collateral use from Jan. 1, 2013, until March 31, 2013. The parties stipulated that the use of case will be on the same terms and conditions as provided in the final cash collateral order. In the final cash collateral order -- which was reported by the TCR on Oct. 2, 2012 -- the Court authorized, on a final basis, the Debtors' use of the cash collateral which first lien lenders and second lien lenders assert interest. As adequate protection from any diminution in value of the lender's collateral, the Debtors will: 1. grant first priority replacement security interests in and liens upon all postpetition property of the Debtors and their estates and all proceeds and products of such property subject only to the carve-out; and 2. grant second priority replacement security interests and pay a total of $40,000 to the Second Lien Agent to be applied to outstanding and future agency, administrative and transaction fees of the Second Lien Agent during the Chapter 11 cases. According to the Debtors, as of the Petition Date they were liable to: -- Wilmington Trust Company, as administrative agent for the First Lien Lenders in respect of obligations under the First Lien Credit Agreement and related agreements and documents for the aggregate amount of not less than $181,182,013; and -- Wells Fargo Bank, N.A., as administrative agent for the Second Lien Lenders in respect of obligations under the Second Lien Credit Agreement and related agreements and documents for the aggregate amount of not less than $116,252,898. About Legends Gaming Legends Gaming LLC, owns gaming facilities located in Bossier City, Louisiana, and Vicksburg, Mississippi, operating under the DiamondJack's trade name. Legends Gaming LLC, and five related entities, including Louisiana Riverboat Gaming Partnership, filed Chapter 11 petitions (Bankr. W.D. La. Case No. 12-12013) in Shreveport, Indiana, on July 31, 2012, to sell the business for $125 million to Global Gaming Solutions LLC, absent higher and better offers. Legends Gaming acquired the business from Isle of Capri Casinos Inc., in 2006 for $240 million. After breaching covenant with lenders, the Debtors in March 2008 sought Chapter 11 protection, jointly administered under Louisiana Gaming Partnership (Case No. 08-10824). The Debtors emerged from bankruptcy in September 2009 and retained ownership and operation of two "DiamondJacks" hotels and casinos in Bossier City and Vicksburg. The Plan restructured $162.1 million owed to the first lien lenders and $75 million owed to secured lien lenders, which would be paid in full, with interest, over time. The Debtors' properties comprise 60,000 square feet of gaming space with 1,913 slot machines, 48 table games and 693 hotel rooms. Revenues in fiscal 2011 were $99.8 million in Louisiana and $39.7 million in Mississippi. As of July 31, 2012, first lien lenders are owed $181.2 million and second lien lenders are owed $114.7 million. Louisiana Riverboat Gaming Partnership disclosed $104,846,159 in assets and $298,298,911 in liabilities as of the Chapter 11 filing. Attorneys at Heller, Draper, Hayden Patrick & Horn serve as counsel to the Debtors. Sea Port Group Securities, LLC is the financial advisor. Kurtzman Carson Consultants LLC as is the claims and notice agent. The Debtors have tapped Jenner & Block LLP as special counsel. LOUISIANA RIVERBOAT: Jan. 28 Hearing on Exclusivity Extension ------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Louisiana will convene a hearing on Jan. 28, 2013, at 9 a.m., to consider Legends Gaming LLC, et al.'s request for an exclusivity extension. The Debtors are asking the Court to extend their exclusive period to solicit acceptances for their Plan until April 29, 2013. The Debtors have filed a plan, but it has not yet been accepted. Accordingly, they seek an extension of the current 180-day deadline that expires Jan. 28. About Legends Gaming Legends Gaming LLC, owns gaming facilities located in Bossier City, Louisiana, and Vicksburg, Mississippi, operating under the DiamondJack's trade name. Legends Gaming LLC, and five related entities, including Louisiana Riverboat Gaming Partnership, filed Chapter 11 petitions (Bankr. W.D. La. Case No. 12-12013) in Shreveport, Indiana, on July 31, 2012, to sell the business for $125 million to Global Gaming Solutions LLC, absent higher and better offers. Legends Gaming acquired the business from Isle of Capri Casinos Inc., in 2006 for $240 million. After breaching covenant with lenders, the Debtors in March 2008 sought Chapter 11 protection, jointly administered under Louisiana Gaming Partnership (Case No. 08-10824). The Debtors emerged from bankruptcy in September 2009 and retained ownership and operation of two "DiamondJacks" hotels and casinos in Bossier City and Vicksburg. The Plan restructured $162.1 million owed to the first lien lenders and $75 million owed to secured lien lenders, which would be paid in full, with interest, over time. The Debtors' properties comprise 60,000 square feet of gaming space with 1,913 slot machines, 48 table games and 693 hotel rooms. Revenues in fiscal 2011 were $99.8 million in Louisiana and $39.7 million in Mississippi. As of July 31, 2012, first lien lenders are owed $181.2 million and second lien lenders are owed $114.7 million. Louisiana Riverboat Gaming Partnership disclosed $104,846,159 in assets and $298,298,911 in liabilities as of the Chapter 11 filing. Attorneys at Heller, Draper, Hayden Patrick & Horn serve as counsel to the Debtors. Sea Port Group Securities, LLC is the financial advisor. Kurtzman Carson Consultants LLC as is the claims and notice agent. The Debtors have tapped Jenner & Block LLP as special counsel. LOUISIANA RIVERBOAT: Confirmation Hearing Continued Until Feb. 6 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Louisiana: (i) denied, in part, Global Gaming's motion vacating order approving the Disclosure Statement explaining the Joint Chapter 11 Plan for Louisiana Riverboat Gaming Partnership, et al., as amended through Nov. 29, 2012; and (ii) adjourned the confirmation hearing scheduled for Feb. 6, 2013; and (iii) granted, in part, Global Gaming's motion to supplement the approved Amended Disclosure Statement. According to the Joint Disclosure Statement, amended as of Nov. 29, 2012, the primary purposes of the Plan are to: -- provide for the sale of substantially all of the Debtors' assets to Global Gaming Legends, LLC, a Delaware limited liability company, Global Gaming Vicksburg, LLC, a Delaware limited liability company and Global Gaming Bossier City, LLC, a Delaware limited liability company, for $125 million pursuant to a certain Purchase Agreement dated as of July 25, 2012; -- provide for the assumption or timely payment of the Assumed Liabilities and LRGP Retained Liabilities; and -- provide for payments and distributions to creditors. Under the Plan the Debtors intend to pay claims in full except for these claassses: 1. The holders of the first lien lenders' secured claim which will recover 67% on account of their claims. 2. General Unsecured Claims which will recover .00002% of their claims if the class accepts the Plan; and 0% if the class rejects the Plan. 3. Each of second lien lenders' claims, interests in riverboat gaming, preferred interests, and common interests has an estimated recovery of 0% on account of their claims. A copy of the Disclosure Statement, as amended, is available for free at http://bankrupt.com/misc/LOUISIANARIVERBOAT_Nov29_DS.pdf About Legends Gaming Legends Gaming LLC, owns gaming facilities located in Bossier City, Louisiana, and Vicksburg, Mississippi, operating under the DiamondJack's trade name. Legends Gaming LLC, and five related entities, including Louisiana Riverboat Gaming Partnership, filed Chapter 11 petitions (Bankr. W.D. La. Case No. 12-12013) in Shreveport, Indiana, on July 31, 2012, to sell the business for $125 million to Global Gaming Solutions LLC, absent higher and better offers. Legends Gaming acquired the business from Isle of Capri Casinos Inc., in 2006 for $240 million. After breaching covenant with lenders, the Debtors in March 2008 sought Chapter 11 protection, jointly administered under Louisiana Gaming Partnership (Case No. 08-10824). The Debtors emerged from bankruptcy in September 2009 and retained ownership and operation of two "DiamondJacks" hotels and casinos in Bossier City and Vicksburg. The Plan restructured $162.1 million owed to the first lien lenders and $75 million owed to secured lien lenders, which would be paid in full, with interest, over time. The Debtors' properties comprise 60,000 square feet of gaming space with 1,913 slot machines, 48 table games and 693 hotel rooms. Revenues in fiscal 2011 were $99.8 million in Louisiana and $39.7 million in Mississippi. As of July 31, 2012, first lien lenders are owed $181.2 million and second lien lenders are owed $114.7 million. Louisiana Riverboat Gaming Partnership disclosed $104,846,159 in assets and $298,298,911 in liabilities as of the Chapter 11 filing. Attorneys at Heller, Draper, Hayden Patrick & Horn serve as counsel to the Debtors. Sea Port Group Securities, LLC is the financial advisor. Kurtzman Carson Consultants LLC as is the claims and notice agent. The Debtors have tapped Jenner & Block LLP as special counsel. LYMAN HOLDINGS: Plan Confirmation Hearing Set for Feb. 28 --------------------------------------------------------- The Hon. Dennis D. O'Brien of the U.S. Bankruptcy Court for the District of Minnesota will convene a hearing on Feb. 28, 2013, at 9:30 a.m., to consider the confirmation of a Chapter 11 Plan for Lyman Holding Company, et al. Objections, if any, are due seven days prior to the hearing if hand delivered, and ten days prior to the hearing if it is mailed. The Disclosure Statement proposed by the Debtors and the Official Committee of Unsecured Creditors on Jan. 18, 2013, has been approved as containing adequate information. Written ballots accepting or rejecting the Plan are due five days prior to the hearing. The Court also ordered that Feb. 28, 2013, is fixed as the last day to file a complaint objecting to the Debtor's discharge. According to the Disclosure Statement, the Plan creates a liquidating fund and assigns a liquidating agent to undertake the continuing post-confirmation sale of all of the Debtors' remaining assets, the resolution of claims, the pursuit of Avoidance Claims and Causes of Action, the distribution of proceeds to the holders of Allowed claims, and such other actions as are necessary to wind down the Debtors' businesses. Under the Plan, allowed secured claims will be paid from the proceeds of the sale of the collateral securing each such claim. Allowed unsecured claims will be paid from the remaining proceeds of sales and net recoveries from Avoidance Actions and other Causes of Action. The Plan provides a mechanism for interim distributions to holders of allowed claims that will allow them to receive distributions as soon as practicable. The Plan will provide the greatest recovery for and fastest payment to creditors. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/LYMAN_HOLDING_ds_plan2amended.pdf About Lyman Lumber Lyman Lumber Company sells building supplies, such as framing beams, roofing materials, siding and drywall to residential builders. The 113-year old company and several affiliates sought Chapter 11 petition (Bankr. D. Minn. Lead Case No. 11-45190) on Aug. 4, 2011. Judge Dennis O'Brien presides over the cases. Lyman Lumber estimated $50 million to $100 million in assets and $100 million to $500 million in debts. The petition was signed by James E. Hurd, president and chief executive officer. The affiliates that filed for Chapter 11 are: Lyman Holding Company; Automated Building Components, Inc.; Building Material Wholesalers; Carpentry Contractors Corp.; Construction Mortgage Investors Co.; Lyman Development Co.; Lyman Lumber of Wisconsin, Inc.; Lyman properties LLC; Mid-America Cedar, Inc.; Woodinville Lumber, Inc.; and Woodinville Construction Services LLC. Cynthia A. Moyer, Esq., Douglas W. Kassebaum, Esq., James L. Baillie, Esq., and Sarah M. Gibbs, Esq., at Fredrikson & Bryon, P.A., serve as bankruptcy counsel. BGA Management, LLC d/b/a Alliance Management, developed and executed a sale process and marketing strategy for the Debtors' assets. The Official Committee of Unsecured Creditors of Lyman Lumber Company tapped Fafinsky, Mark & Johnson, P.A., as its counsel. Alliance Management is the financial and turnaround consultant. When they filed for bankruptcy, the Debtors had in hand a term sheet with SP Asset Management, LLC, a unit of Steel Partners Holdings L.P., to serve as stalking horse bidder for the assets of the Debtors. New York City-based Steel Partners is a diversified holding company that owns and operates businesses in a variety of industries. MAKENA GREAT: Cash Collateral Hearing Continued Until Jan. 31 ------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois continued until Jan. 31, 2013, at 10 a.m., the hearing to consider a stipulation authorizing GAC Storage Copley Place, LLC's use of cash collateral. The stipulation, entered between GAC Storage Copley Place, LLC, and Bank of America, N.A., relate to a fifth amendment and extension of the stipulation and final order authorizing use of cash collateral. The stipulation also provides that, among other things: -- paragraph 9 of the final cash collateral order is amended to replace the date "Dec. 31, 2012, with "Jan. 31, 2013;" and -- the final cash collateral order remains in full force and effect. About Makena Great American GAC Storage Lansing LLC -- which owns and operates a warehouse and storage facility with 522 storage units, generally located at 2556 Bernice Road, Lansing, Illinois -- filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 11-40944) on Oct. 7, 2011. Jay S. Geller, Esq., D. Sam Anderson, Esq., and Halliday Moncure, Esq., at Bernstein, Shur, Sawyer & Nelson, P.A., represents the Debtor as counsel. Robert M, Fishman, Esq., and Gordon E. Gouveia, Esq., at Shaw Gussis Fishman Glantz Wolfson, & Towbin LLC, in Chicago, represents the Debtor as local counsel. It estimated $1 million to $10 million in assets and debts. The petition was signed by Noam Schwartz, secretary and treasurer of EBM Mgmt Servs, Inc., manager of GAC Storage, LLC. The Makena Great American Anza Company LLC -- http://www.makenacapital.net/-- a commercial shopping center developers in Southern California, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 11-48549) on Dec. 1, 2011, in Chicago. Anza leads the way in the acquisition and development of "A-Location" small commercial shopping centers and corner properties in Southern California. Lawyers at Shaw Gussis Fishman Glantz Wolfson & Towbin, LLC, in Chicago, and Bernstein, Shur, Sawyer & Nelson, P.A., in Portland, Maine, serve as counsel to the Debtor. Makena disclosed $13,938,161 in assets and $17,723,488 in liabilities. Other affiliates that sought bankruptcy protection are GAC Storage Copley Place LLC, GAC Storage El Monte LLC, and San Tan Plaza LLC. The cases are being jointly administered under lead case no. 11-40944. At the behest of lender Bank of America, N.A., the Bankruptcy Court dismissed the Chapter 11 case of San Tan Plaza, as reported by the Troubled Company Reporter on July 17, 2012. Anza, Copley and El Monte have filed separate bankruptcy exit plans. The Court is slated to consider approval of those plans at hearings on Sept. 6 and 7, 2012. MARKETING WORLDWIDE: Black Arch Discloses 7.9% Equity Stake ----------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Black Arch Opportunity Fund LP disclosed that, as of Jan. 22, 2013, it beneficially owns 37,012,200 shares of common stock of Marketing Worldwide Corporation representing 7.9% of the shares outstanding. A copy of the filing is available at: http://is.gd/AS0KT2 About Marketing Worldwide Based in Howell, Michigan, Marketing Worldwide Corporation operates through the holding company structure and conducts its business operations through its wholly owned subsidiaries Colortek, Inc., and Marketing Worldwide, LLC. Marketing Worldwide, LLC, is a complete design, manufacturer and fulfillment business providing accessories for the customization of vehicles and delivers its products to large global automobile manufacturers and certain Vehicle Processing Centers primarily in North America. MWW operates in a 23,000 square foot leased building in Howell Michigan. Colortek, Inc., is a Class A Original Equipment painting facility and operates in a 46,000 square foot owned building in Baroda, which is in South Western Michigan. MWW invested approximately $2 million into this paint facility and expects the majority of its future growth to come from this business. Marketing Worldwide incurred a net loss of $11.11 million for the year ended Sept. 30, 2012, compared with a net loss of $2.27 million during the prior year. Marketing Worldwide's balance sheet at Sept. 30, 2012, showed $1.19 million in total assets, $16.24 million in total liabilities and a $15.05 million total deficiency. RBSM, LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2012. The independent auditors noted that the Company has generated negative cash flows from operating activities, experienced recurring net operating losses, is in default of certain loan covenants, and is dependent on securing additional equity and debt financing to support its business efforts which factors raise substantial doubt about the Company's ability to continue as a going concern. MARKETING WORLDWIDE: St. George Discloses 9.9% Equity Stake ----------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, St. George Investments, LLC, Fife Trading, Inc., and John M. Fife disclosed that, as of July 5, 2012, they beneficially own 46,596,034 shares of common stock of Marketing Worldwide Corp which is 9.9% of the 470,667,013 shares that were outstanding on Jan. 22, 2013. Mr. Fife is the sole member of St. George and the president and sole shareholder of Fife Trading. St. George has rights to convert a Note into an aggregate number of shares of the Company's common stock which, except for a contractual cap on the amount of outstanding shares of the Company's common stock that St. George may own, would exceed such a cap. The Note's original ownership cap of 4.99% was subject to increase to 9.99% in the event of a drop in the Company's 30-day average Market Capitalization below $400,000. On July 5, 2012, St. George sent notice to the Company that the 30-day average Market Capitalization had fallen below $400,000 and, consequently, St. George's ownership limitation had increased to 9.99% of the Company's outstanding shares. A copy of the filing is available at http://is.gd/mrED3x About Marketing Worldwide Based in Howell, Michigan, Marketing Worldwide Corporation operates through the holding company structure and conducts its business operations through its wholly owned subsidiaries Colortek, Inc., and Marketing Worldwide, LLC. Marketing Worldwide, LLC, is a complete design, manufacturer and fulfillment business providing accessories for the customization of vehicles and delivers its products to large global automobile manufacturers and certain Vehicle Processing Centers primarily in North America. MWW operates in a 23,000 square foot leased building in Howell Michigan. Colortek, Inc., is a Class A Original Equipment painting facility and operates in a 46,000 square foot owned building in Baroda, which is in South Western Michigan. MWW invested approximately $2 million into this paint facility and expects the majority of its future growth to come from this business. The Company incurred a net loss of $11.11 million for the year ended Sept. 30, 2012, compared with a net loss of $2.27 million during the prior year. Marketing Worldwide's balance sheet at Sept. 30, 2012, showed $1.19 million in total assets, $16.24 million in total liabilities and a $15.05 million total deficiency. RBSM, LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2012. The independent auditors noted that the Company has generated negative cash flows from operating activities, experienced recurring net operating losses, is in default of certain loan covenants, and is dependent on securing additional equity and debt financing to support its business efforts which factors raise substantial doubt about the Company's ability to continue as a going concern. MEDICURE INC: Standard Aero Executive Named to Board of Directors ----------------------------------------------------------------- Medicure Inc. appointed Brent Fawkes CA, to the Board of Directors. Mr. Fawkes is a Chartered Accountant with over 20 years of experience in accounting and finance. Mr. Fawkes is currently the Vice President of Finance with Standard Aero Limited, one of the world's largest independent providers of a variety of aerospace services serving a diverse array of customers in business and general aviation, airline, military, helicopter, components, energy and VIP completions markets. In his current role, Mr. Fawkes is responsible for the oversight of the finance department including external reporting, budgeting and planning and treasury management. About Medicure Inc. Based in Winnipeg, Manitoba, Canada, Medicure Inc. (TSX/NEX: MPH.H) -- http://www.medicure.com/-- is a biopharmaceutical company engaged in the research, development and commercialization of human therapeutics. The Company has rights to the commercial product, AGGRASTAT(R) Injection (tirofiban hydrochloride) in the United States and its territories (Puerto Rico, U.S. Virgin Islands, and Guam). AGGRASTAT(R), a glycoprotein GP IIb/IIIa receptor antagonist, is used for the treatment of acute coronary syndrome (ACS) including unstable angina, which is characterized by chest pain when one is at rest, and non-Q-wave myocardial infarction. KPMG LLP, in Winnipeg, Canada, issued a "going concern" qualification on the consolidated financial statements for the fiscal year ended May 31, 2012. The independent auditors noted that the Company has experienced operating losses and has accumulated a deficit of $123,303,052 that raises substantial doubt about its ability to continue as a going concern. Medicure reported net income of C$23.38 million for the year ended May 31, 2012, in comparison with a net loss of C$1.63 million during the prior fiscal year. The Company's balance sheet at Aug. 31, 2012, showed C$4.11 million in total assets, C$6.37 million in total liabilities and a C$2.26 million total deficiency. MERIDIAN SUNRISE: Shopping Center Files to Stop Lenders ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the owner of the Sunrise Village shopping center in Sumner, Washington, sought bankruptcy protection to hold off lenders from exercising default remedies in view of a non-payment default on $64.3 million in mortgages. Principal and interest payments on the mortgages are current, according to the owner. The only default is failure to comply with a "debt service coverage ratio" in the mortgage, which gave the lenders the right this month to demand interest at the default rate. About Meridian Sunrise Meridian Sunrise Village LLC filed a Chapter 11 petition (Bankr. W.D. Wash. Case No. 13-40342) in Tacoma, Washington, on Jan. 18, 2013. The Debtor, a single asset real estate under 11 U.S.C. Sec. 101(51B), disclosed $70.6 million in total assets and $65.9 million in total liabilities in its schedules. The Debtor owns the property known as the New Meridian Sunrise Village in 10507 156th St. E. Puyallup, Washington. The Debtor has valued the property at $70 million, which property secures debt of $64.4 million to U.S. Bank, National Association. A copy of the schedules attached to the petition is available at http://bankrupt.com/misc/wawb13-40342.pdf MERVYN'S LLC: Navroth Claim No. 7535 Dismissed as Late Filed ------------------------------------------------------------ Bankruptcy Judge Kevin Gross issued a corrected order dismissing John Navroth, II's Claim No. 7535 as late filed in the Chapter 11 case of Mervyn's Holdings, LLC. As reported by the Troubled Company Reporter on Jan. 21, 2013, at the behest of Mervyn's, Judge Gross dismissed the amended claims for work-related injuries asserted by Mr. Navroth, against the Debtors as the amended claims were filed after the deadline for filing proofs of claim. Judge Gross abstained from hearing on Mr. Navroth's initial claims, saying the injury claims raises only California workers' compensation law and non-core to the bankruptcy case. Mr. Navroth filed Claim No. 3283 on Jan. 2, 2009, in the amount of $671,759.86 -- a general unsecured component of $635,000 and a $36,759.86 priority component. Thereafter, he filed Claims No. 7228, 7479, 7493, 7498, 7511 and 7528, beginning on June 15, 2009, and received by the claims agent on June 17, 2009. The claims bar date was Jan. 9, 2009. In the Initial Claim, Mr. Navroth seeks damages for alleged injuries from a work related accident (dropping a folding table on his foot). The Initial Claim includes allegations of and requests for compensation for physical and emotional suffering and demands for payment of vacation, sick and personal holiday time. The alleged incident occurred in California prior to the Debtors' bankruptcy. Importantly, the Claimant filed a statutory workers' compensation proceeding prior to the commencement of the bankruptcy case. The Amended Claims contain allegations of breaches of fiduciary duties, discrimination, employment discrimination, interference with contractual relations and interference with prospective business advantage. The Amended Claims increase the total sum Claimant seeks to in excess of $21 million. The Claimant also alleges that the Amended Claims are secured. "The Amendments are clearly new claims filed after the Bar Date and are therefore void. The Court carefully reviewed the Amended Claims against the Initial Claim and it is beyond any doubt that the Amended Claims are not related to the Initial Claim," said Judge Gross. The Debtors also argue that they are entitled to summary judgment in their favor on the Claimant's allegations of willful misconduct and fraudulent concealment. Judge Gross said the Court is not prepared to entertain the Debtors' request for summary judgment because the Debtors did not provide notice or grounds to the Claimant in advance of the Claimant's response papers. Moreover, it is not necessary for the Court to reach the substantive merits of the Initial Claim, since the Court finds that its abstention is necessary in the interests of justice. A copy of the Court's Jan. 22, 2013 Memorandum Opinion (Corrected) is available at http://is.gd/GB0EHFfrom Leagle.com. About Mervyn's LLC Headquartered in the San Francisco Bay Area, Mervyn's LLC -- http://www.mervyns.com/-- provided a mix of top national brands and exclusive private labels. Mervyn's had 176 locations in seven states. Mervyn's stores had an average of 80,000 retail square feet, smaller than most other mid-tier retailers and easier to shop, and were located primarily in regional malls, community shopping centers, and freestanding sites. The Company and its affiliates filed for Chapter 11 protection (Bankr. D. Del. Case No. 08-11586) on July 29, 2008. Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis & Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi, Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at Richards Layton & Finger P.A., represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The Debtors' financial advisor is Miller Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30, 2008, showed $665,493,000 in total assets and $717,160,000 in total liabilities resulting in a $51,667,000 total stockholders' deficit. In October 2008, Mervyn's decided to pursue liquidation. MF GLOBAL: Trustee Settles Disputes With ConocoPhillips ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that commodity customer ConocoPhillips Co. settled disputes with the trustee for defunct broker MF Global Inc. on the question of whether using $205 million in letters of credit properly enabled the customer to avoid a loss when the broker became insolvent and went into liquidation. The report notes that absent settlement, U.S. District Judge Katherine B. Forrest in New York was scheduled to decide whether letters of credit should be treated the same as cash, making ConocoPhillips suffer losses like everyone else. A filing in Judge Forrest's court Jan. 23 said that ConocoPhillips and James Giddens, the MF Global trustee, reached a "settlement in principle." The report recounts that ConocoPhillips was one of only nine customers who deposited letters of credit rather than cash to stand as margin in trading accounts. The U.S. Commodity Futures Trading Commission and the MF Global trustee both took the position that governing law and regulations required ConocoPhillips to suffer losses even though the letters of credit were never drawn. According to the report, Judge Forrest had taken the dispute away from the bankruptcy judge. Papers had been filed on both sides of the question. The parties were awaiting a decision. Houston- based ConocoPhillips argued that the "plain language" of the governing regulation says that the "full proceeds" of letters of credit, not the "full face amount," are treated like cash representing customer property. Since there never was a default on the letter of credit, there was no occasion for a draw on the letters of credit and thus no cash to treat as customer property to be shared pro rata with other customers, the company said. When the MF Global liquidation began, there was a shortfall of about $1.6 billion in supposedly segregated customer property. Having posted undrawn letters of credit, ConocoPhillips suffered no losses like other customers. About MF Global New York-based MF Global (NYSE: MF) -- http://www.mfglobal.com/-- is one of the world's leading brokers of commodities and listed derivatives. MF Global provides access to more than 70 exchanges around the world. The firm is also one of 22 primary dealers authorized to trade U.S. government securities with the Federal Reserve Bank of New York. MF Global's roots go back nearly 230 years to a sugar brokerage on the banks of the Thames River in London. MF Global Holdings Ltd. and MF Global Finance USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059 and 11-5058) on Oct. 31, 2011, after a planned sale to Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF Global had $41,046,594,000 in total assets and $39,683,915,000 in total liabilities. It is easily the largest bankruptcy filing so far this year. Judge Honorable Martin Glenn presides over the Chapter 11 case. J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve as bankruptcy counsel. The Garden City Group, Inc., serves as claims and noticing agent. The petition was signed by Bradley I. Abelow, Executive Vice President and Chief Executive Officer of MF Global Finance USA Inc. The Securities Investor Protection Corporation commenced liquidation proceedings against MF Global Inc. to protect customers. James W. Giddens was appointed as trustee pursuant to the Securities Investor Protection Act. He is a partner at Hughes Hubbard & Reed LLP in New York. Jon Corzine, the former New Jersey governor and co-CEO of Goldman Sachs Group Inc., stepped down as chairman and chief executive officer of MF Global just days after the bankruptcy filing. U.S. regulators are investigating about $633 million missing from MF Global customer accounts, a person briefed on the matter said Nov. 3, according to Bloomberg News. MF GLOBAL: CFTC Commissioner Overseeing Probe Steps Down -------------------------------------------------------- The Commodity Futures Trading Commission on Thursday said Jill E. Sommers, a Republican regulator overseeing the investigation into MF Global's collapse, has announced her resignation. Ms. Sommers issued this statement: "As I prepare to leave the Commodity Futures Trading Commission I would like to acknowledge the hard work and dedication of my fellow Commissioners and the many talented staff with whom I have had the pleasure of working for the past five years. While many challenges remain in finalizing the implementation of the Dodd-Frank Act, I have every confidence that the American public will be well-served by their continuing efforts." Ben Protess, writing for The New York Times, reports the move was "surprising" for Ms. Sommers, who will exit with more than a year left on her term and without concluding the MF Global investigation, an inquiry into how the bankrupt brokerage firm misused customer money. The NY Times calls the resignation "abrupt". A former lobbyist and Congressional staff member, Ms. Sommers is departing without indicating a next career move, according to agency officials. The NY report says Ms. Sommers will leave the agency after the first quarter of the year. Her letter did not specify a reason for resigning, though some people close to the agency surmised that Ms. Sommers planned to spend more time with her three children. The report relates Bart Chilton, a Democratic commissioner at the agency, may take over Ms. Sommers's role in the MF Global case. About MF Global New York-based MF Global (NYSE: MF) -- http://www.mfglobal.com/-- is one of the world's leading brokers of commodities and listed derivatives. MF Global provides access to more than 70 exchanges around the world. The firm is also one of 22 primary dealers authorized to trade U.S. government securities with the Federal Reserve Bank of New York. MF Global's roots go back nearly 230 years to a sugar brokerage on the banks of the Thames River in London. MF Global Holdings Ltd. and MF Global Finance USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059 and 11-5058) on Oct. 31, 2011, after a planned sale to Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF Global had $41,046,594,000 in total assets and $39,683,915,000 in total liabilities. It is easily the largest bankruptcy filing so far this year. Judge Honorable Martin Glenn presides over the Chapter 11 case. J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve as bankruptcy counsel. The Garden City Group, Inc., serves as claims and noticing agent. The petition was signed by Bradley I. Abelow, Executive Vice President and Chief Executive Officer of MF Global Finance USA Inc. The Securities Investor Protection Corporation commenced liquidation proceedings against MF Global Inc. to protect customers. James W. Giddens was appointed as trustee pursuant to the Securities Investor Protection Act. He is a partner at Hughes Hubbard & Reed LLP in New York. Jon Corzine, the former New Jersey governor and co-CEO of Goldman Sachs Group Inc., stepped down as chairman and chief executive officer of MF Global just days after the bankruptcy filing. U.S. regulators are investigating about $633 million missing from MF Global customer accounts, a person briefed on the matter said Nov. 3, according to Bloomberg News. MOTORS LIQUIDATION: Files Copy of GUC Trust Report with SEC ----------------------------------------------------------- Pursuant to the Amended and Restated Motors Liquidation Company GUC Trust Agreement dated as of June 11, 2012, as amended, Wilmington Trust Company, acting solely in its capacity as trust administrator and trustee of the Motors Liquidation Company GUC Trust, is required to file certain GUC Trust Reports with the Bankruptcy Court for the Southern District of New York. In addition, pursuant to a Bankruptcy Court Order Authorizing the GUC Trust Administrator to Liquidate New GM Securities for the Purpose of Funding Fees, Costs and Expenses of the GUC Trust and the Avoidance Action Trust, dated March 8, 2012, the GUC Trust Administrator is required to file certain quarterly variance reports. On Jan. 22, 2013, the GUC Trust Administrator filed the GUC Trust Report required by Section 6.2(c) of the GUC Trust Agreement together with the Budget Variance Report, each for the quarter ended Dec. 31, 2012. In addition, the Motors Liquidation Company GUC Trust announced that no distribution in respect of its Units is anticipated for the fiscal quarter ended December 31, 2012. A copy of the Bankruptcy Court filing is available at: http://is.gd/Do2HV8 About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. MUNICIPAL CORRECTIONS: Employs Schwartzer as Local Counsel ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Nevada authorized Municipal Corrections, LLC, to employ Schwartzer & McPherson Law Firm as local bankruptcy counsel. Schwartzer will, among other things, prepare on behalf of the Debtor any necessary motions, applications, answers, orders reports and papers as required by applicable bankruptcy or nonbankruptcy law, dictated by the demands of the case, or required by the Court, and represent the Debtor in proceedings or hearings, at these hourly rates: Lenard E. Schwartzer $550 Jeanette E. McPherson $450 Jason A. Imes $350 Emelia L. Allen $250 Angela Hosey $150 Sheena Clow $150 About Municipal Corrections Hamlin Capital Management, LLC, Oppenheimer Rochester National Municipals, and UMB, N.A., as indenture trustee -- owed an aggregate $90 million on a bond debt -- filed an involuntary Chapter 11 petition for Municipal Corrections, LLC (Bankr. D. Nev. Case No. 12-12253) on Feb. 29, 2012. Jon T. Pearson, Esq., at Ballard Spahr LLP, in Las Vegas, Nevada, serves as counsel to the petitioners. In August, the bankruptcy judge ruled that the prison is properly in Chapter 11 to reorganize. Austin E. Carter, Esq., at Stone & Baxter LLP, in Macon, Ga.; and Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, in Las Vegas, Nev., represent the Debtor as counsel. The Debtor disclosed $656,378 in assets and $61,769,528 in liabilities as of the Chapter 11 filing. As reported in the TCR on Jan. 3, 2013, Bankruptcy Judge Thad J. Collins granted the request of creditor Irwin County to transfer the venue of the Debtor's Chapter 11 bankruptcy case to the U.S. Bankruptcy Court for the Northern District of Georgia. MUNICIPAL CORRECTIONS: Wins OK for Stone & Baxter as Lead Counsel ----------------------------------------------------------------- Municipal Corrections, LLC, sought and obtained permission to employ Stone & Baxter, LLP, as its counsel, nunc pro tunc to the Petition Date. Stone & Baxter will, among other things, assist the Debtor in analyzing and pursuing any proposals relating to disposition of assets of the Debtor's estate and prepare and advise the Debtor regarding any Chapter 11 plan filed by the Debtor, at these hourly rates: Attorney $180-$395 Research Assistants & Paralegals $125 About Municipal Corrections Hamlin Capital Management, LLC, Oppenheimer Rochester National Municipals, and UMB, N.A., as indenture trustee -- owed an aggregate $90 million on a bond debt -- filed an involuntary Chapter 11 petition for Municipal Corrections, LLC (Bankr. D. Nev. Case No. 12-12253) on Feb. 29, 2012. Jon T. Pearson, Esq., at Ballard Spahr LLP, in Las Vegas, Nevada, serves as counsel to the petitioners. In August, the bankruptcy judge ruled that the prison is properly in Chapter 11 to reorganize. Austin E. Carter, Esq., at Stone & Baxter LLP, in Macon, Ga.; and Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, in Las Vegas, Nev., represent the Debtor as counsel. The Debtor disclosed $656,378 in assets and $61,769,528 in liabilities as of the Chapter 11 filing. As reported in the TCR on Jan. 3, 2013, Bankruptcy Judge Thad J. Collins granted the request of creditor Irwin County to transfer the venue of the Debtor's Chapter 11 bankruptcy case to the U.S. Bankruptcy Court for the Northern District of Georgia. MUSCLEPHARM CORP: Inter-Mountain No Longer Owns Common Shares ------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Inter-Mountain Capital Corp., JFV Holdings, Inc., and John M. Fife disclosed that, as of Jan. 11, 2013, they do not beneficially own any shares of common stock of MusclePharm Corp. The reporting persons previously reported beneficial ownership of 14,817,246 common shares or a 9.99% equity stake as of June 29, 2011. A copy of the amended filing is available at: http://is.gd/yuRHfm About MusclePharm Headquartered in Denver, Colorado, MusclePharm Corporation (OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life- style company that develops and manufactures a full line of National Science Foundation approved nutritional supplements that are 100% free of banned substances. MusclePharm is sold in over 120 countries and available in over 5,000 U.S. retail outlets, including GNC and Vitamin Shoppe. MusclePharm products are also sold in over 100 online stores, including bodybuilding.com, Amazon.com and Vitacost.com. The Company reported a net loss of $23.28 million in 2011, compared with a net loss of $19.56 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $7.81 million in total assets, $15.10 million in total liabilities, and a $7.29 million total stockholders' deficit. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Berman & Company, P.A., in Boca Raton, Florida, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has a net loss of $23,280,950 and net cash used in operations of $5,801,761 for the year ended Dec. 31, 2011; and has a working capital deficit of $13,693,267, and a stockholders' deficit of $12,971,212 at Dec. 31, 2011. NATURAL PORK: Reaches Deal for Use of Cash Collateral ----------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Iowa approved a stipulation authorizing Natural Pork Production II, LLP's use of cash collateral. The stipulation was entered among the Debtors, First Farmers Bank and Trust, AgStar Financial Services, FLCA, Metropolitan Life Insurance Co., the Official Committee of Unsecured Creditors, and the Inter-Creditor Committee. The Debtor would use the cash collateral of secured creditors -- First Farmers Bank and Trust, AgStar Financial Services, FLCA, GE Capital Business Asset Funding Corp. and Metropolitan Life Insurance Co. -- to pay the regular, customary, usual, necessary and ordinary expenses of the Debtor postpetition. The Debtor is indebted to the secured creditors in these approximate amounts: a) FFBT Colfax Note: $659,218 b) FFBT Crawfordsville Note: $1,358,934 c) AgStar: $3,816,457 d) GE: $1,343,148.95 e) MetLife: $275,954.90 As adequate protection from any diminution in value of the lenders' collateral, the Debtor will grant the lenders superpriority administrative expense claim status, subject to carve out on certain expenses. As further adequate protection, the Debtor will make postpetition monthly payments to each secured creditor in an amount equal to the amount paid prepetition. About Natural Pork Production II Hog raiser Natural Pork Production II, LLP filed for Chapter 11 bankruptcy (Bankr. S.D. Iowa Case No. 12-02872) on Sept. 11, 2012, in Des Moines. The Company formerly did business as Natural Pork Production, LLC. It does business as Crawfordsville, LLC, Brayton, LLC, South Harlan, LLC, and North Harlan, LLC. The Debtor disclosed $31.9 million in asset and $27.9 million in liabilities, including $7.49 million of secured debt in its schedules. Bankruptcy Judge Anita L. Shodeen oversees the case. Donald F. Neiman, Esq., and Jeffrey D. Goetz, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C., in Des Moines, Iowa, represent the Debtor as general reorganization counsel. John C. Pietila, Esq., at Davis, Brown, Koehn, Shors & Roberts, P.C., in West Des Moines, Iowa, represents the Debtor as special corporate counsel, effective as of the Petition Date. Aaron L Hammer, Esq., Mark S. Melickian, Esq., and Michael A. Brandess, Esq., at Sugar, Felsenthal Grais & Hammer LLP, in Chicago, represent the Official Committee of Unsecured Creditors. Conway MacKenzie, Inc., serves as its financial advisor. Gary W. Koch, Esq., and Michael S. Dove, Esq., represent AgStar Financial Services, ACA, and AgStar Financial Services, FLCA, as counsel. Michael P. Mallaney, Esq., at Hudson Mallaney Schindler & Anderson, in West Des Moines, Iowa, represent the IC Committee as counsel. NEW ENGLAND COMPOUNDING: Creditors May Seize Owners' Assets ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the newly formed creditors' committee of New England Compounding Pharmacy Inc. intends to ask the bankruptcy judge for an order freezing assets of the company's four owners. The committee's action was prompted by the company's disclosure on Jan. 18 that the owners received more than $21 million from NECP although revenue in 2012 was only $32.4 million. According to the report, the committee is supporting a motion by the U.S. Trustee for appointment of a Chapter 11 trustee to wrest control from a chief restricting officer appointed by the owners. In a court filing, the company signaled it may not oppose having a trustee. A hearing on the motion was slated for Jan. 24. The report discloses that the committee urged U.S. Bankruptcy Judge Henry J. Boroff in Boston to retain the case in Chapter 11 and not convert to liquidation in Chapter 7. The committee said it will be easier to craft settlements with the owners if there can be a Chapter 11 plan giving them immunity from additional suits. The committee, the report relates, also filed papers this week for permission to sue the four owners -- Carla Conigliaro, Gregory Conigliaro, Barry Cadden, and Lisa Congiliaro Cadden. The committee says they received fraudulent transfers and preferential payments. The committee's request for authorization to sue was also scheduled for a Jan. 24 hearing. The committee said it intends to seek "prejudgment writs of attachment on real property" belonging to the owners. About New England Compounding New England Compounding Pharmacy Inc., filed a Chapter 11 petition (Bankr. D. Mass. Case No. 12-19882) in Boston on Dec. 21, 2012. Daniel C. Cohn, Esq., at Murtha Cullina LLP, serves as counsel. Verdolino & Lowey, P.C. is the financial advisor. The Debtor estimated assets and liabilities of at least $1 million. The Debtor owns and operates the New England Compounding Center is located in Framingham, Mass. The company said at the outset of bankruptcy that it would work with creditors and insurance companies to structure a Chapter 11 plan dealing with personal injury claims. The outbreak linked to the pharmacy has killed 39 people and sickened 656 in 19 states, though no illnesses have been reported in Massachusetts. In October, the company recalled all its products, not just those associated with the meningitis outbreak. An official unsecured creditors' committee was formed to represent individuals with personal-injury claims. The members selected Brown & Rudnick LLP to be the committee's lawyers. NEW YORK WESTCHESTER: Court OKs Montefiore's Bid to Buy Assets -------------------------------------------------------------- The Bankruptcy Court for the Southern District of New York on Jan. 24 approved Montefiore Medical Center's bid to acquire the facilities of New York Westchester Square Medical Center (NYWSMC), a Bronx, N.Y., neighborhood hospital that has operated under Chapter 11 bankruptcy protection for nearly seven years. "Montefiore has a longstanding commitment to its community. We want to provide vital healthcare services that are forward- thinking, coordinated and patient-centered, and in so doing, safeguard jobs and support local businesses," said Steven M. Safyer, M.D., President and Chief Executive Officer of Montefiore. "Our model is based on the belief that comprehensive and well- managed care improves patients' overall well-being." The new facility will be renamed Montefiore Westchester Square. The plan is to have a full-service emergency department, an ambulatory surgery center and, over time, comprehensive primary and specialty care services. Montefiore is committed to preserving as many jobs as possible and will begin working closely with NYWSMC's labor unions to identify qualified staff eligible for hire by Montefiore. "The physicians and staff at NYWSMC have maintained the highest level of professionalism at a time when the medical center was under financial stress and its future uncertain," Dr. Safyer said. "They have sustained the warm and caring environment that has characterized this institution for many years." NYWSMC was founded in 1929. Approximately half of NYWSMC's physicians currently have privileges at Montefiore; others have the option of applying for privileges. The transaction, which is subject to regulatory approval, is supported by $20 million in funding available under the state's Health Efficiency and Affordability Law. Closing is expected to take place in March. About New York Westchester Square Medical Center Headquartered in Bronx, New York, New York Westchester Square Medical Center -- http://www.nywsmc.org/--is a not-for-profit, community acute care hospital and certified stroke center that has served a working class population in the Bronx community since 1929. Its primary facility, located at 2475 St. Raymond Avenue, Bronx, New York 10461, houses 205 beds and provides acute adult medical and surgical care, emergency medicine and ambulatory services. NYWSMC is a membership corporation whose members are selected by the New York-Presbyterian Healthcare System, Inc. The company filed for chapter 11 protection on Dec. 19, 2006 (Bankr. S.D.N.Y. Case No. 06-13050). Burton S. Weston, Esq., at Garfunkel, Wild & Travis, P.C., represents the Debtor. Louis A. Scarcella, Esq., and Robert C. Yan, Esq., at Farrell Fritz PC, represent the Official Committee Of Unsecured Creditors. The Debtor's schedules showed total assets of $49,283,477 and total debts of $35,502,088. NORTEL NETWORKS: Mediation Continues Without End Date ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that creditors of Nortel Networks Inc. from the U.S., U.K. and Canada are continuing mediation in Toronto to decide on how to carve up $9 billion among bankruptcies in the three countries. The report recounts that mediation began Jan. 14. The Chief Justice of Ontario, serving as mediator, said Jan. 22 that the mediation will continue. She didn't give an end date. The sale of Nortel assets generated $9 billion. The money can't be distributed absent agreement on how much goes to the bankruptcies in each country. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did business in more than 150 countries around the world. Nortel Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The United States Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. NEXT 1 INTERACTIVE: Incurs $2 Million Net Loss in Nov. 30 Qtr. -------------------------------------------------------------- Next 1 Interactive, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $2 million on $221,731 of total revenues for the three months ended Nov. 30, 2012, compared with a net loss of $2.80 million on $410,669 of total revenues for the same period during the previous year. For the nine months ended Nov. 30, 2012, the Company reported a net loss of $2.92 million on $530,987 of total revenues, compared with a net loss of $8.02 million on $1.10 million of total revenues for the same period a year ago. The Company's balance sheet at Nov. 30, 2012, showed $5.05 million in total assets, $14.60 million in total liabilities and a $9.55 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/WAw4Wt About Next 1 Interactive Weston, Fla.-based Next 1 Interactive, Inc., is the parent company of RRTV Network (formerly Resort & Residence TV), Next Trip -- its travel division, and Next One Realty -- its real estate division. The Company is positioning itself to emerge as a multi revenue stream "Next Generation" media-company, representing the convergence of TV, mobile devices and the Internet by providing multiple platform dynamics for interactivity on TV, Video On Demand (VOD) and web solutions. The Company has worked with multiple distributors beta testing its platforms as part of its roll out of TV programming and VOD Networks. The list of multi- system operators the Company has worked with includes Comcast, Cox, Time Warner and Direct TV. At present the Company operates the Home Tour Network through its minority owned/joint venture real estate partner -- RealBiz Media. As of July 17, 2012, the Home Tour Network features over 4,300 home listings in four cities on the Cox Communications network. As reported in the TCR on June 21, 2012, Sherb & Co., LLP, in Boca Raton, Florida, issued a "going concern" qualification on the consolidated financial statements for the year ended Feb. 29, 2012. The independent auditors noted that the Company had an accumulated deficit of $66,983,176 and a working capital deficit of $14,546,150 at Feb. 29, 2012, net losses for the year ended Feb. 29, 2012m of $13,651,066 and cash used in operations during the year ended Feb. 29, 2012, of $4,822,423. These conditions raise substantial doubt about the Company's ability to continue as a going concern. NORTEL NETWORKS: Gets OK to Move Ahead on Deal with Retirees ------------------------------------------------------------ Peg Brickley at Daily Bankruptcy Review reports that Nortel Networks Corp. moved ahead on some $98 million worth of settlements with U.S. retirees and with former workers who had stashed some of their savings in a special retirement fund only to have the company attempt to seize the money after it filed for bankruptcy protection. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did business in more than 150 countries around the world. Nortel Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The United States Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. NORTEL NETWORKS: Reaches Settlement with U.S. Disabled Employees ---------------------------------------------------------------- Reuters reported that Nortel Networks Inc. has reached a settlement with a committee representing its long-term disabled employees over a plan to end disability benefits, according to court documents. Nortel said it will not terminate any of the existing long-term disability benefits for its former employees on or before May 31, unless the company grants the committee a general unsecured claim of $28 million, according to the report. If the company were to grant the committee an unsecured claim, the proceeds of the claim, minus the administrative costs, would be allocated among the disabled employees and would free Nortel from any further liability, Reuters noted. The company, according to Reuters, has asked only for an initial approval of the settlement agreement with an opportunity for the employees to object to the settlement, according to documents filed on Friday. The initial hearing regarding the approval is expected to take place on Feb. 14. A hearing over a plan to end long-term disability benefits for the company's former U.S. employees had been postponed earlier this month, Reuters recalled. The proposal to end those benefits has been cast as a life-and-death battle against bondholders. Nortel once dominated the Toronto Stock Exchange as a $250 billion telecoms company that spanned the globe, Reuters pointed out. It struggled after the 1990s tech bubble burst and, dogged by accounting problems, filed for bankruptcy in January 2009. The company has sold all of its operations, piling up $9 billion in cash in the process; however, it was never settled how to divide that money among the bankruptcy and insolvency proceedings in Canada, the United States and Europe, Reuters said. Mediated talks aimed at dividing Nortel's cash are scheduled to end on Tuesday, Reuters added. The negotiations have pitted bondholders against retirees. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did business in more than 150 countries around the world. Nortel Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The United States Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Official Committee of Unsecured Creditors. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. OCEAN BREEZE: Chapter 11 Case Dismissed with Prejudice ------------------------------------------------------ The Hon. Erik P. Kimball of the U.S. Bankruptcy Court for the Southern District of Florida dismissed the Chapter 11 case of Ocean Breeze Park Homeowners' Association, Inc., with prejudice for 180 days. The Debtor must pay to the U.S. Trustee and the Clerk of the Bankruptcy Court the appropriate sums required pursuant to Section 1930 of the Bankruptcy Code. As reported in the TCR on Dec. 14, 2012, secured creditors Cathie Teal, Gary Hendry and Marcia Hendry-Coker asked the Court to dismiss the Chapter 11 case of the Debtor, or in the alternative, grant lenders relief from the automatic stay. Prepetition, the lenders provided $24,500,000 purchase money financing to the Debtor to purchase shares of a corporation that owned a residential mobile home park located in Jensen Beach, Florida. According to the Lenders, the Debtor has no equity in the property and will be unable to propose a confirmable plan, at any time, over lenders' objection. Additionally, the value of lenders' collateral, including the property, continues to decline during the pendency of the case which is essentially a two-party dispute between Debtor and lenders. About Ocean Breeze Park JOcean Breeze Park Homeowners' Association, Inc., a residential cooperative mobile home park located at 3000 N.E. Indian River Drive, Jensen Beach, Florida, filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 12-28820) in West Palm Beach on Aug. 3, 2012. Bankruptcy Judge Erik P. Kimball presides over the case. Ocean Breeze Park Homeowners' Association operates a residential cooperative mobile home park located at 3000 N.E. Indian River Drive, Jensen Beach. The shareholders have equity ownership in the Cooperative, allowing them to hold proprietary leases which provide for 99-year leasehold agreements. There are 549 mobile home units, 39 cottages and 16 recreational vehicle units. There are 137 units subject to the proprietary leases. Bankruptcy Judge Erik P. Kimball presides over the case. Lawyers at Furr and Cohen, P.A., serve as the Debtor's counsel. In its schedules, the Debtor disclosed $13,472,535 in assets and $24,870,355 in liabilities. The petition was signed by Harry Bartlett, president. OMEGA NAVIGATION: Has Access to Cash Collateral Until March 25 -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas continued until March 25, 2013, at 2 p.m., the hearing to consider Baytown Navigation Inc., et al.'s motion for cash collateral use. The Court also ordered that the Debtors are authorized to use cash collateral until March 25. A copy of the budget is available for free at: http://bankrupt.com/misc/OMEGANAVIGATION_cashcoll_budget.pdf As reported in the TCR on Jan. 8, 2013, HSH Nordbank AG, as agent, asserts that pursuant to the senior facilities agreement and the other senior facilities documents, the Debtors are indebted to the senior facilities lenders in the principal amount of US$242,720,000, plus accrued and accruing interest and all other amounts. The junior lenders assert a lien on inter alia, the ships, all cash collateral and all prepetition collateral pursuant to a $42,500,000 loan dated March 27, 2008. As adequate protection from diminution in value of the lenders' collateral, the Debtors will: -- make adequate protection payments; -- grant the lenders adequate protection liens in all of their rights, title and interest in their property, and a superpriority administrative expense claim status, subject to carve out. -- provide continued maintenance of, and insurance on, the ships and all of their other assets and property, consistent with the Debtors' prepetition practices. About Omega Navigation Athens, Greece-based Omega Navigation Enterprises Inc. and affiliates, owner and operator of tankers carrying refined petroleum products, filed for Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 11-35926) on July 8, 2011, in Houston, Texas in the United States. Omega is an international provider of marine transportation services focusing on seaborne transportation of refined petroleum products. The Debtors disclosed assets of US$527.6 million and debt totaling US$359.5 million. Together, the Debtors wholly own a fleet of eight high-specification product tankers, with each vessel owned by a separate debtor entity. HSH Nordbank AG, as the senior lenders' agent, has first liens on vessels to secure a US$242.7 million loan. The lenders include Bank of Scotland and Dresdner Bank AG. The ships are encumbered with US$36.2 million in second mortgages with NIBC Bank NV as agent. Before bankruptcy, Omega sued the senior bank lenders in Greece contending they violated an agreement to grant a three year extension on a loan that otherwise matured in April 2011. An affiliate of Omega that manages the vessels didn't file, nor did affiliates with partial ownership interests in other vessels. Judge Karen K. Brown presides over the case. Bracewell & Giuliani LLP serves as counsel to the Debtors. Jefferies & Company, Inc., is the financial advisor and investment banker. The Official Committee of Unsecured Creditors has tapped Winston & Strawn as local counsel; Jager Smith as lead counsel; and First International as financial advisor. OLDE PRAIRIE: 2nd Stab at Ch. 11 Fails; CenterPoint to Foreclose ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois dismissed the Chapter 11 case of Olde Prairie Block Owner, LLC, at the behest of CenterPoint Properties Trust. CenterPoint has requested that the Court dismiss the Debtor's second chapter 11 case for cause, or in the alternative lift the automatic stay to permit foreclosure action to proceed. The Court also ordered that the automatic stay is lifted as to CenterPoint and CenterPoint may proceed in its pending foreclosure action against the Debtor in the Cicuit Court of Cook County, Illinois. About Olde Prairie Block Owner Olde Prairie Block Owner, LLC, filed a bare-bones Chapter 11 petition (Bankr. N.D. Ill. Case No. 12-37599) in Chicago in September 2012, disclosing assets of $97 million in assets and $80.6 million in liabilities in its schedules. The Debtor owns two properties: (i) the Old Prairie Property, a 53,575 square foot parcel that has a building and a gravel paved lot at E. Cermak Road in Chicago, and (ii) the Lakeside Property, a 159,960 square- feet property that contains buildings in Chicago. The Debtor said CenterPoint Properties Trust has a disputed claim of $70.8 million, of which $63.3 million is secured. JMB Capital Partners is owed $3.4 million on account of DIP financing in a previous Chapter 11 case. Olde Prairie Block first sought chapter 11 protection (Bankr. N.D. Ill. Case No. 10-22668) on May 18, 2010. Two years later, the bankruptcy judge in Chicago dismissed the case and granted Centerpoint's motion to lift automatic stay to permit its state- court foreclosure action to proceed. In the prior case, the Debtor was represented by John Ruskusky, Esq., George R. Mesires, Esq., and Patrick F. Ross, Esq., at Ungaretti & Harris LLP, in Chicago. Robert R. Benjamin, Esq., at Golan & Christie, LLP, serves as counsel to the Debtor in the 2012 Chapter 11 case. CenterPoint is represented in the 2012 case by David F. Heroy, Esq., and Erin E. Broderick, Esq., at Baker & McKenzie LLP. No creditor's committee has been appointed in the case. No trustee has been appointed. OSAGE EXPLORATION: Norman Dowling to Serve as Part-Time CFO ----------------------------------------------------------- Osage Exploration and Development, Inc., entered into a CFO Consulting Agreement with Norman Dowling to serve as a part-time Chief Financial Officer of the Company. Mr. Dowling has over 20 years of finance experience, including four years as Executive Vice President and Chief Financial Officer of The Active Network, Inc., during which time Active completed 23 acquisitions and three private equity rounds raising over $165 million, and four years as Vice President Finance, at PETCO Animal Supplies, Inc., during which time PETCO was taken private through a leveraged recapitalization and re-emerged as a public company through an Initial Public Offering. Mr. Dowling also served as Chief Financial Officer of Factory 2U Stores, Inc., and CinemaStar Luxury Theatres, Inc. In addition to a number of other senior financial positions, Mr. Dowling's experience includes six years with Ernst & Young in audit assurance and management consultancy roles. Mr. Dowling holds a Bachelor of Commerce degree from University College Dublin, Ireland. Pursuant to the Agreement, Mr. Dowling will devote approximately one third of his time to the Company and be compensated at a rate of $5,000 per month. A copy of the Consulting Agreement is available at: http://is.gd/ogHUez About Osage Exploration Based in San Diego, California with production offices in Oklahoma City, Oklahoma, and executive offices in Bogota, Colombia, Osage Exploration and Development, Inc. (OTC BB: OEDV) -- http://www.osageexploration.com/-- is an independent exploration and production company with interests in oil and gas wells and prospects in the US and Colombia. GKM, LLP, in Encino, California, expressed substantial doubt about the Company's ability to continue as a going concern following the Company's 2011 financial results. The independent auditors noted that the Company has suffered recurring losses from operations and has an accumulated deficit as of Dec 31, 2011. The Company's balance sheet at Sept. 30, 2012, showed $13.19 million in total assets, $5.16 million in total liabilities and $8.03 million in total stockholders' equity. Bankruptcy Warning Management of the Company has undertaken steps as part of a plan to improve operations with the goal of sustaining the Company's operations for the next 12 months and beyond. These steps include (a) assigning a portion of the Company's oil and gas leases in Logan County, Oklahoma (b) participating in drilling of wells in Logan County, Oklahoma within the next 12 months, (c) controlling overhead and expenses and (d) raising additional equity or debt. There is no assurance the Company can accomplish these steps and it is uncertain the Company will achieve profitable operations and obtain additional financing. There is no assurance additional financings will be available to the Company on satisfactory terms and conditions, if at all. If the Company is unable to continue as a going concern, the Company may elect or be required to seek protection from its creditors by filing a voluntary petition in bankruptcy or may be subject to an involuntary petition in bankruptcy. PEDEVCO CORP: Amends Current Report to Correct Disclosure Error --------------------------------------------------------------- Pedevco Corp., on Jan. 15, 2013, filed a current report on Form 8-K that discussed under Item 4.02 (Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review) two restatements of the Company's financial statements. The Current Report on Form 8-K that the Company filed on Jan. 15, 2013, incorrectly is shown on the Web site of the Securities and Exchange Commission as having been filed under Item 4.01 (Changes in Registrant's Certifying Accountant). The Company, on January 18, filed a further amended Current Report on Form 8-K/A to correct that error and to clarify that the subject matter of the Company's filing pertains to Item 4.02, rather than Item 4.01, of Form 8-K. On Dec. 12, 2012, the Board of Directors of the Company concluded that the consolidated financial statements of the Company for the year ended Dec. 31, 2011, previously filed on Form 8-K/A on Aug. 8, 2012, should no longer be relied upon and should be restated in order to correct the Company's accounting for the fully vested non-forfeitable stock award issued to investor relations consultants as disclosed in Note 9 of these consolidated financial statements. The Company originally recorded the $69,667 value of the award as a stock service receivable in the balance sheet as performance was not required until the Company had completed a reverse merger transaction, at which time the 18 month service period would commence. Because the award is fully vested and non-forfeitable and the Company has no ability to compel specific performance, the Company reconsidered its accounting for this transaction and concluded that the appropriate treatment should have been to expense the value of the award in full. These consolidated financial statements are being restated to reflect this correction. A copy of the Amended Report is available for free at: http://is.gd/JJQ0M0 About PEDEVCO Corp. PEDEVCO Corp., d/b/a Pacific Energy Development (OTCBB:PEDO) is a publicly-traded energy company engaged in the acquisition and development of strategic, high growth energy projects, including shale oil and gas assets in the United States and Pacific Rim countries. The company's producing assets include its Niobrara Asset located in the DJ Basin in Colorado, the Eagle Ford Asset in McMullen County, Texas, and the North Sugar Valley Field located in Matagorda County, Texas. The company was founded in early 2011 and has offices in Danville, California and Beijing, China. In the auditors' report accompanying the financial statements for year ended Dec. 31, 2011, GBH CPAs, PC, in Houston, Texas, expressed substantial doubt about Blast Energy Services' ability to continue as a going concern. The independent auditors noted that Blast incurred a loss from continuing operations for 2011, and has an accumulated deficit at Dec. 31, 2011. The Company reported a net loss of $4.14 million in 2011, compared with a net loss of $1.51 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $11.62 million in total assets, $3.96 million in total liabilities, $1.25 million in redeemable series A convertible preferred stock, and $6.41 million in total stockholders' equity. PENNFIELD CORP: Wants More Time for Plan After Buyer Defaults ------------------------------------------------------------- Pennfield Corporation and Pennfield Transport Company ask the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to extend their exclusive period to file a plan until May 31, 2013, and their exclusive right to solicit acceptances or rejections until July 30, 2013. The Debtors relate that after purchaser Wellsource Facilities Holding, LLC, f/k/a Carlisle Advisors, LLC, failed to advance needed to conclude the closing on the purchase of the Debtor's business and assets, the Debtors, on Dec. 19, 2012, declared Wellsource in default of the Asset Purchase Agreement dated Oct. 3, 2012. Wellsource as the DIP Lender also defaulted under the Court's Final Order dated Nov. 8, 2012, authorizing a $2,000,000 DIP Facility to the Debtors. About Pennfield Corporation Pennfield Corporation and Pennfield Transport Company filed a Chapter 11 petition (Bankr. E.D. Pa. Case No. 12-19430 and 12-19431) on Oct. 3, 2012, in Philadelphia. Founded in 1919, Pennfield is a Lancaster, Pennsylvania-based manufacturer of bulf and bagged feeds for dairy, equine and other commercial and backyard livestock. The Company owns and operates three production mills located in Mount Joy, Martinsburg, and South Montrose, in Pennsylvania. The Debtors filed for bankruptcy to sell their assets to Carlisle Advisors, LLC, subject to higher and better offers. Carlisle had also agreed to provide a $2.0 million DIP Loan but later defaulted on this commitment. Judge Bruce I. Fox presides over the case. Attorneys at Maschmeyer Karalis P.C., in Philadelphia, serve as the Debtors' bankruptcy counsel. Skadden, Arps, Slate, Meagher & Flom LLP is the special counsel. Groom Law Group, Chartered, is the employee benefits counsel. AEG Partners LLC is the financial advisor. Lakeshore Food Advisors, LLC, is the investment banker. Pennfield filed official lists showing assets of $7.2 million and liabilities totaling $26.1 million, including $11.3 million in secured claims. Debt includes $10 million owing to secured lender Fulton Bank NA. PENNFIELD CORP: Can Hire Rettew Assoc. as Environmental Consultant ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Pennsylvania authorized Pennfield Corporation to employ Rettew Associates, Inc., as its environmental consultant. As reported in the TCR on Jan. 11, 2013, Rettew, as compensation for its services, is requiring that the Debtor: (i) pay $4,200 in connection to a Phase I Environmental Site Site Assessment for the Office Building in Lancaster, Pa., and (ii) $3,800 in connection to a Phase I for the farm in York, Pa., for a total maximum amount due of $8,000. About Pennfield Corporation Pennfield Corporation and Pennfield Transport Company filed a Chapter 11 petition (Bankr. E.D. Pa. Case No. 12-19430 and 12-19431) on Oct. 3, 2012, in Philadelphia. Founded in 1919, Pennfield is a Lancaster, Pennsylvania-based manufacturer of bulf and bagged feeds for dairy, equine and other commercial and backyard livestock. The company owns and operates three production mills located in Mount Joy, Martinsburg, and South Montrose, in Pennsylvania. The Debtors filed for bankruptcy to sell their assets to Carlisle Advisors, LLC, subject to higher and bettr offers. Carlisle has also agreed to provide a $2.0 million DIP Loan. Judge Bruce I. Fox presides over the case. Attorneys at Maschmeyer Karalis P.C., in Philadelphia, serve as the Debtors' bankruptcy counsel. Skadden, Arps, Slate, Meagher & Flom LLP is the special counsel. Groom Law Group, Chartered, is the employee benefits counsel. AEG Partners LLC is the financial advisor. Lakeshore Food Advisors, LLC, is the investment banker. Pennfield filed official lists showing assets of $7.2 million and liabilities totaling $26.1 million, including $11.3 million in secured claims. Debt includes $10 million owing to secured lender Fulton Bank NA. PENSON WORLDWIDE: Seeks Approval to Hire Advisors ------------------------------------------------- BankruptcyData reported that Penson Worldwide filed with the U.S. Bankruptcy Court motions to retain: -- Paul, Weiss, Rifkind, Wharton & Garrison (Contact: Andrew N. Rosenberg) as attorney at the following hourly rates: partner at $850 to $1,160, counsel at $800 to $835, associate at $445 to $765 and legal assistant at $85 to $255; -- Young Conaway Stargatt & Taylor (Contact: Pauline K. Morgan) as attorney at hourly rates ranging from $160 to $730; -- Kurtzman Carson Consultants (Contact: Albert Kass) as administrative advisor; -- KPMG (Contact: Thomas D. Bibby ) as financial advisor at the following hourly rates: managing director/partner/principal at $500 to $600, manager/director at $350 to $500, associate/senior associate at $200 to $350 and intern/paraprofessional at $100 to $200; -- Akin Gump Strauss Hauer & Feld (Contact: Scott Barnard) as special litigation counsel at the following hourly rates: partner at $625 to $930, counsel at $560 to $600, associate at $365 to $435 and paraprofessional at $85 to $225; and -- Sandtree Finance (Contact: Peter R. Corbell) as advisor in connection with the restructuring of Nexa Technologies for a monthly fee of $25,000 and a transaction fee of $200,000. About Penson Worldwide Plano, Texas-based Penson Worldwide Inc. and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10061) on Jan. 11, 2013. Founded in 1995, Penson Worldwide is provider of a range of critical securities and futures processing infrastructure products and services to the global financial services industry. The company?s products and services include securities and futures clearing and execution, financing and cash management technology and other related offerings, and it provides tools and services to support trading in multiple markets, asset classes and currencies. Penson was one of the top two clearing brokers overall in the United States. Its foreign-based subsidiaries were some of the largest independent clearing brokers in Canada and Australia and the second largest independent clearing broker in the United Kingdom as of Dec. 31, 2010. In 2012, the company sold its futures division to Knight Capital Group Inc. and its broker-deal subsidiary to Apex Clearing Corp. But the company was unable to successfully streamline is business after the asset sales. Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Young, Conaway, Stargatt & Taylor serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. The company estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. The last publicly filed financial statements as of June 30 showed assets of $1.17 billion and liabilities totaling $1.227 billion. PENSON WORLDWIDE: Moody's Withdraws 'Ca1' Rating After Bankruptcy ----------------------------------------------------------------- Moody's Investors Service has withdrawn the ratings of Penson Worldwide, Inc. upon its filing of bankruptcy protection on January 11, 2013. Ratings Rationale The last rating action was on March 14, 2012, when Moody's downgraded the Corporate Family Rating and Senior Secured Ratings of Penson to Ca from Caa1 following its announcement of an exchange offer which Moody's viewed as a distressed exchange. PEREGRINE FINANCIAL: Wasendorf Set for Sentencing Jan. 31 --------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Russell R. Wasendorf Sr., the former chief executive officer of liquidating commodity broker Peregrine Financial Group Inc., will be sentenced on Jan. 31 in federal district court in Cedar Rapids, Iowa, where he pleaded guilty in September to four counts of mail fraud, embezzlement and making false statements. According to the report, the government contends the loss to customers exceeded $200 million, meaning that the sentences on each count should be served consecutively up to the 50-year maximum under sentencing guidelines. This month the judge preliminarily ordered Mr. Wasendorf to forfeit $100 million. The forfeiture will become permanent at sentencing next week. The government calculates the loss as $215 million. Mr. Wasendorf believes the loss is less than $200 million, making him eligible for a shorter sentence. Mr. Wasendorf is being held without bail. U.S. District Judge Linda R. Reade previously said Mr. Wasendorf was facing a minimum of 24 to 30 years in prison given the charges to which he pleaded guilty. About Peregrine Financial Peregrine Financial Group Inc. filed to liquidate under Chapter 7 of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 12-27488) on July 10, 2012, disclosing between $500 million and $1 billion of assets, and between $100 million and $500 million of liabilities. Earlier that day, at the behest of the U.S. Commodity Futures Trading Commission, a U.S. district judge appointed a receiver and froze the firm's assets. The firm put itself into bankruptcy liquidation in Chicago later the same day. The CFTC had sued Peregrine, saying that more than $200 million of supposedly segregated customer funds had been "misappropriated." The CFTC case is U.S. Commodity Futures Trading Commission v. Peregrine Financial Group Inc., 12-cv-5383, U.S. District Court, Northern District of Illinois (Chicago). Peregrine's CEO Russell R. Wasendorf Sr. unsuccessfully attempted suicide outside a firm office in Cedar Falls, Iowa, on July 9. The bankruptcy petition was signed in his place by Russell R. Wasendorf Jr., the firm's chief operating officer. The resolution stated that Wasendorf Jr. was given a power of attorney on July 3 to exercise if Wasendorf Sr. became incapacitated. Peregrine Financial is the regulated unit of the brokerage PFGBest. PEREGRINE FINANCIAL: Fraud Loss Tops $215 Million, Says U.S. ------------------------------------------------------------ Ann Saphir and Tom Polansek, writing for Reuters, reported that Peregrine Financial Group's former chief executive stole more than $215 million from customers of his now-defunct futures brokerage and should be sentenced to the maximum 50 years in jail, U.S. prosecutors said on Tuesday. Russell Wasendorf Sr., 64, who founded the firm, has pleaded guilty to embezzlement but wants a lighter sentence, saying the loss was less than $200 million and that he used "very basic, simple means" to carry out his fraud, according to documents filed by U.S. prosecutors, the report related. Wasendorf, whose attempted suicide sent his firm into bankruptcy last July, is in jail in Iowa and will be sentenced on January 31, the report noted. Reuters reported that U.S. prosecutors say the large loss, the sophisticated nature of the crime, and the sheer number of victims -- more than 10,000 -- justify his spending the rest of his life behind bars. "While some of defendant's individual acts might be characterized as simple in isolation, they were part of an exceedingly complex scheme whereby defendant's entire business was used as a mechanism to gather and purloin investor funds," prosecutors said in their sentencing memorandum, promising to fight any attempt by Wasendorf to receive a sentence of less than 50 years, Reuters related. Prosecutors put the exact loss at $215,530,547, based on Peregrine's bank records, and will call Brenda Cuypers, the firm's chief financial officer, as a witness at the sentencing hearing next week, Reuters said. They had previously pegged the embezzlement only at "more than $100 million," to which Wasendorf pleaded guilty. Reuters related that the collapse last July of Peregrine Financial, known as PFGBest, dealt a blow to confidence in the U.S. futures industry, already reeling from $1.6 billion hole in customer pockets left when giant brokerage MF Global failed nine months earlier. Futures traders had never before suffered such large losses as a result of a brokerage failure, according to Reuters. "To see (Wasendorf) go to jail could give some people some hope," James Koutoulas, co-head of the Commodity Customer Coalition, which fought to get customer money back in both bankruptcies, told Reuters. "In MF Global, justice hasn't been done." No one has been charged with wrongdoing in MF Global's collapse, Reuters noted. Regulators, according to Reuters, have scrambled to patch perceived gaps in customer protections at brokerages and exchanges that handle contracts valued at some $2.5 trillion a day. That figure is set to rise as new rules push over-the-counter swaps onto regulated trading venues. The sentencing memorandum offers new details in the government's account of the fraud, which Wasendorf said in a July confession began in the early 1990s after he was hounded by an overzealous regulator, Reuters related. The fraud began even earlier, prosecutors said in Tuesday's filing, when he stole at least $250,000 from customers' accounts to pay back the original financier of his brokerage, a person referred to in the document only by the initials "J.C." "Using a copy machine, defendant fabricated a bank statement to conceal the theft of funds," the document said, Reuters quoted. For the next nearly 20 years, prosecutors said, he faked bank balances, fabricated deposits, and used a rented post office box in Cedar Falls, Iowa, to intercept letters from his auditors meant to check up on his balances at U.S. Bank. He even went so far as to fly from Chicago, where his firm did most of its business, to Iowa to prevent the near-discovery of his fraud, ultimately convincing Peregrine and U.S. Bank employees that nothing was wrong, the document said, according to Reuters. All the while he worked to make Peregrine Financial seem much bigger and more successful than it was, they said, the report related. Wasendorf believed that "if he could make himself appear rich, the auditors and regulators wouldn't be concerned with the state of his personal finances and not discover it was all a fraud," prosecutors quoted Wasendorf as saying in a sealed presentencing report, Reuters said. But Peregrine was never actually profitable, even though by its demise investors had entrusted more than $376 million to him and his firm, they said. About Peregrine Financial Peregrine Financial Group Inc. filed to liquidate under Chapter 7 of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 12-27488) on July 10, 2012, disclosing between $500 million and $1 billion of assets, and between $100 million and $500 million of liabilities. Earlier that day, at the behest of the U.S. Commodity Futures Trading Commission, a U.S. district judge appointed a receiver and froze the firm's assets. The firm put itself into bankruptcy liquidation in Chicago later the same day. The CFTC had sued Peregrine, saying that more than $200 million of supposedly segregated customer funds had been "misappropriated." The CFTC case is U.S. Commodity Futures Trading Commission v. Peregrine Financial Group Inc., 12-cv-5383, U.S. District Court, Northern District of Illinois (Chicago). Peregrine's CEO Russell R. Wasendorf Sr. unsuccessfully attempted suicide outside a firm office in Cedar Falls, Iowa, on July 9. The bankruptcy petition was signed in his place by Russell R. Wasendorf Jr., the firm's chief operating officer. The resolution stated that Wasendorf Jr. was given a power of attorney on July 3 to exercise if Wasendorf Sr. became incapacitated. Peregrine Financial is the regulated unit of the brokerage PFGBest. PINNACLE AIRLINES: Relocates Headquarters to Minnesota ------------------------------------------------------ Pinnacle Airlines Corp. on Jan. 24 disclosed that its headquarters will relocate to Minnesota. The decision came after an exhaustive evaluation of the most cost-effective option as the Company emerges from Chapter 11. The present headquarters location in Memphis, Tenn. was also evaluated. Pinnacle's operation will be located in vacant space leased by Delta Air Lines on Minneapolis-St. Paul International Airport property. "We had the responsibility to explore every aspect of our business to find opportunities to reduce costs, including evaluating our property leases, to find the most economical options for Pinnacle," said John Spanjers, president and CEO of Pinnacle Airlines. "Our analysis covered everything from the available labor pool and operational alignment to economic incentives. Both Memphis and the State of Minnesota presented very strong cases. In the end, it was an economic decision." "We especially appreciate the efforts of Gov. Bill Haslam and the State of Tennessee, Mayor A C Wharton and the City of Memphis, the Downtown Memphis Commission, our landlord at One Commerce Square, Gov. Mark Dayton and the State of Minnesota, the Metropolitan Airports Commission in Minneapolis-St. Paul and Delta. They all were very aggressive in working with us and our decision was difficult to make." "This is a significant milestone in our restructuring and represents substantial progress that we expect will allow us to continue down a path toward successfully emerging from bankruptcy," Mr. Spanjers said. Pinnacle presently occupies 170,000 square feet at One Commerce Square in downtown Memphis, which houses approximately 500 employees. Tentative plans call for the move to Minnesota to be completed by May 2013. About Pinnacle Airlines Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/-- a $1 billion airline holding company with 7,800 employees, is the parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.; and Colgan Air, Inc. Flying as Delta Connection, United Express and US Airways Express, Pinnacle Airlines Corp. operating subsidiaries operate 199 regional jets and 80 turboprops on more than 1,540 daily flights to 188 cities and towns in the United States, Canada, Mexico and Belize. Corporate offices are located in Memphis, Tenn., and hub operations are located at 11 major U.S. airports. Pinnacle Airlines Inc. and its affiliates, including Colgan Air, Mesaba Aviation Inc., Pinnacle Airlines Corp., and Pinnacle East Coast Operations Inc. filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Lead Case No. 12-11343) on April 1, 2012. Judge Robert E. Gerber presides over the case. Lawyers at Davis Polk & Wardwell LLP, and Akin Gump Strauss Hauer & Feld LLP serve as the Debtors' counsel. Barclays Capital and Seabury Group LLC serve as the Debtors' financial advisors. Epiq Systems Bankruptcy Solutions serves as the claims and noticing agent. The petition was signed by John Spanjers, executive vice president and chief operating officer. As of Oct. 31, 2012, the Company had total assets of $800.33 million, total liabilities of $912.77 million and total stockholders' deficit of $112.44 million. Delta Air Lines, Inc., the Debtors' major customer and post- petition lender, is represented by David R. Seligman, Esq., at Kirkland & Ellis LLP. The official committee of unsecured creditors tapped Morrison & Foerster LLP as its counsel, and Imperial Capital, LLC, as financial advisors. QBEX ELECTRONICS: Has Access to Cash Collateral Until Jan. 29 ------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized, in a second interim order, QBEX Electronics Corporation to use cash collateral of Bank Leumi USA until Jan. 31, 2013. As adequate protection, the Bank will have nunc pro tunc to Nov. 15, 2012, a replacement lien pursuant to 11 U.S.C. Section 3611(2) on and in all property of the Debtor, and monthly payments of interest, in accordance with the terms of the loan documents with the Bank, for the month of December 2012 and the month of January 2013. The Debtor is authorized to use cash collateral for a payment of fees to the Clerk of the Court and the United States Trustee pursuant to 28 U.S.C. Section 1930, regardless whether these fees are specifically addressed by the Budget. A final hearing on the Debtor's emergency motion for interim and final orders authorizing its use of cash collateral will be conducted by the Court on Jan. 29, 2013, at 1:30 p.m. About QBEX Electronics QBEX Electronics Corporation, Inc., based in Miami, Florida, filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 12-37551) on Nov. 15, 2012. Judge Robert A. Mark oversees the case. Robert A. Schatzman, Esq., and Steven J. Solomon, Esq., at GrayRobinson, P.A., serve as the Debtor's counsel. QBEX scheduled assets of $11,027,058 and liabilities of $8,246,385. The petitions were signed by Jorge E. Alfonso, president. Qbex Colombia, S.A., also sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 12-37558) on Nov. 15, listing $433,627 in assets and $5,792,217 in liabilities. QBEX ELECTRONICS: Can Employ Francisco Fernandez as Accountant -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized QBEX Electronics Corporation to employ Francisco Fernandez and his firm Prats Fernandez & Co. to serve as Debtor's financial advisor and accountant. As reported in the TCR on Jan. 8, 2013, the firm has been the Debtor's accountants for 20 years, and provides book keeping, auditing and preparation of financial statements for the Debtors. About QBEX Electronics QBEX Electronics Corporation, Inc., based in Miami, Florida, filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 12-37551) on Nov. 15, 2012. Judge Robert A. Mark oversees the case. Robert A. Schatzman, Esq., and Steven J. Solomon, Esq., at GrayRobinson, P.A., serve as the Debtor's counsel. QBEX scheduled assets of $11,027,058 and liabilities of $8,246,385. The petitions were signed by Jorge E. Alfonso, president. Qbex Colombia, S.A., also sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 12-37558) on Nov. 15, listing $433,627 in assets and $5,792,217 in liabilities. QBEX ELECTRONICS: Committee Retaining Genovese Joblove as Counsel ----------------------------------------------------------------- The Official Committee of Unsecured Creditors of QBEX Electronics Corporation asks the U.S. Bankruptcy Court for the Southern District of Florida for authorization to retain Glenn D. Moses, Esq., and the law firm of Genovese, Joblove & Battista, P.A. as counsel to the Committee. Genovese Joblove will: (a) advise the Committee with respect to its rights, powers, and duties in these Chapter 11 cases; (b) assist and advise the Committee in its consultations with the Debtors relative to the administration of the Chapter 11 cases; (c) assist the Committee in analyzing the claims of the Debtors' creditors and in negotiating with such creditors; (d) assist with the Committee's investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtor and of the operation of the Debtors' business; (e) assist the Committee in its analysis of, and negotiations with, the Debtors and/or any third party concerning matters related to, among other things, the use of cash collateral, debtor in possession financing, the liquidation of assets and the terms of a plan or plans of reorganization; (f) assist and advise the Committee with respect to its communications with the general creditor body regarding significant matters in these Chapter 11 cases; (g) represent the Committee at all hearings and other proceedings in the Chapter 11 cases; (h) review and analyze all applications, motions, orders, statements of operations, and schedules filed with the Court and advise the Committee as to their propriety; (i) assist the Committee in preparing pleadings and applications as may be necessary in furtherance of the Committee's interests and objectives; and (j) perform other legal services as may be required and are deemed to be in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code. The firm attests that it is "disinterested" as such term is defined in 11 U.S.C. Section 101(14) and has no connection with the Debtors, their creditors or any other party in interest. The hourly rates for the attorneys at GJB range from $200 to $550 per hour. The hourly rates for the legal assistants at GJB range from $125 to $180. GJB reserves the right to increase its hourly rates in accordance with its normal and customary business practices. The hearing to consider the Committee's application is scheduled for Jan. 29, 2013, at 1:30 p.m. About QBEX Electronics QBEX Electronics Corporation, Inc., based in Miami, Florida, filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 12-37551) on Nov. 15, 2012. Judge Robert A. Mark oversees the case. Robert A. Schatzman, Esq., and Steven J. Solomon, Esq., at GrayRobinson, P.A., serve as the Debtor's counsel. QBEX scheduled assets of $11,027,058 and liabilities of $8,246,385. The petitions were signed by Jorge E. Alfonso, president. Qbex Colombia, S.A., also sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 12-37558) on Nov. 15, listing $433,627 in assets and $5,792,217 in liabilities. QUANTUM FUEL: Empery Asset Discloses 6.2% Equity Stake ------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Empery Asset Management, LP, Ryan M. Lane and Martin D. Hoe disclosed that, as of Dec. 31, 2012, they beneficially own warrants to purchase 3,172,578 shares of common stock of Quantum Fuel Systems Technologies Worldwide, Inc., representing 6.23% of the shares outstanding. The reporting persons previously disclosed beneficial ownership of 4,231,900 common shares or 9.9% equity stake as of March 16, 2012. A copy of the amended filing is available at http://is.gd/b9fGrt About Quantum Fuel Lake Forest, Calif.-based Quantum Fuel Systems Technologies Worldwide, Inc. (Nasdaq: QTWW) develops and produces advanced vehicle propulsion systems, fuel storage technologies, and alternative fuel vehicles. Quantum's portfolio of technologies includes electronic and software controls, hybrid electric drive systems, natural gas and hydrogen storage and metering systems and other alternative fuel technologies and solutions that enable fuel efficient, low emission, natural gas, hybrid, plug-in hybrid electric and fuel cell vehicles. As reported in the TCR on March 30, 2012, Haskell & White LLP, in Irvine, California, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that Company incurred significant operating losses and used a significant amount of cash in operations during the eight months ended Dec. 31, 2011. The Company's balance sheet at Sept. 30, 2012, showed $65.6 million in total assets, $45.8 million, and stockholders' equity of $19.8 million. According to the Company's quarterly report for the period ended Sept. 30, 2012, the Company expects that its existing sources of liquidity will only be sufficient to fund its activities through Dec. 31, 2012. "In order for us to have sufficient capital to execute our business plan, fund our operations and meet our debt obligations over this twelve month period, we will need to raise additional capital and/or monetize certain assets. We are considering various cost-effective capital raising options and alternatives including the sale of Schneider Power and/or other assets, and the sale of equity and debt securities. Although we have been successful in the past in raising capital, we cannot provide any assurance that we will be successful in doing so in the future to the extent necessary to be able to fund all of our growth initiatives, operating activities and obligations through Sept. 30, 2013, which raises substantial doubt about our ability to continue as a going concern." RANCHO CALIFORNIA: Creditors Meeting Continued; Plan Due March -------------------------------------------------------------- The U.S. Trustee will convene an 11 U.S.C. Sec. 341(a) meeting of creditors of Rancho California Center on Feb. 12, 2013 at 9:00 a.m. The meeting will be held at 402 W. Broadway, Emerald Plaza Building, Suite 660 (B), Hearing Room B, San Diego, California. Acting U.S. Trustee Tiffany L. Carroll previously scheduled the Sec. 341 meeting for Jan. 15, 2013. But the Debtor failed to appear and testify at the meeting prompting the U.S. Trustee to seek a dismissal of the Chapter 11 case. There were no creditors present at the meeting. In view of the opposition by the Debtor, Bankruptcy Judge Louise DeCarl Adler did not approve the dismissal, without prejudice to the U.S. Trustee submitting a noticed motion. On Wednesday, Jan. 23, the judge approved a stipulation requiring the Debtor to file a Chapter 11 plan and disclosure statement by March 11, 2013. The stipulation was signed by the U.S. Trustee and the Debtor. Last month, Nationwide Life Insurance Company, which claims to be a secured creditor of the Debtor, filed a notice that it has a properly-perfected security interest in the Debtor's property, known as the Northview Business Center, on account of a $3.2 million. It said that the Debtor has been in default on the loan since May 2012. It says that it does not consent o the Debtor's use of cash collateral. About Rancho California Rancho California Center, doing business as North View Business Center, filed a bare-bones Chapter 11 petition (Bankr. S.D. Calif. Case No. 12-16157) on Dec. 10, 2012. The Debtor, a Single Asset Real Estate as defined in 11 U.S.C. Sec. 101(51B), filed schedules disclosing $11.3 million in assets and $3.13 million in liabilities. The Debtor owns a 92,000-square feet industrial building at 4665 North Avenue, in Oceanside, California. The property is valued at $11 million and secures a $3.05 million debt to Nationwide Life Insurance Co. RESIDENTIAL CAPITAL: Wins OK to Sell $130-Mil. FHA Insured Loans ---------------------------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York allowed Residential Capital, LLC, and its debtor affiliates to move forward with the sale of $130 million worth of loans insured by the Federal Housing Administration. The order came despite the U.S. Government's reservation of its rights to object to the proposed sale. The Government, represented by U.S. Attorney Preet Bharara, told the Court that the Government may object to the Debtors' proposal to auction off the FHA-insured loans, saying the sale may extinguish the Government's debt setoff rights tied to the loans. According to the U.S. Attorney, the Government held short of objecting to the proposed auction but said it was reviewing the proposed sale to see if the auction stifles its practice of withholding FHA insurance payments on the government-guaranteed mortgages. In order to facilitate the sale of the assets, the Court set Feb. 6, 2013, as the last day by which any party wishing to submit a bid for the FHA-insured loans must do so. The Sale Hearing will be held before Judge Glenn on April 11. Objections to the sale must be filed on or before April 4. A full-text copy of the form of the mortgage loan purchase and interim servicing agreement (MLPISA) in relation to the sale of the FHA-insured loans, dated Jan. 15, is available at: http://bankrupt.com/misc/rescap_fhaapa.pdf About Residential Capital Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. The Bankruptcy Court in November 2012 approved ResCap's sale of its mortgage servicing and origination platform assets to Ocwen Loan Servicing, LLC and Walter Investment Management Corporation for $3 billion; and its portfolio of roughly 50,000 whole loans to Berkshire Hathaway for $1.5 billion. The sale of the assets, subject to satisfaction of customary closing conditions including certain third party consents, is expected to close in the first quarter of 2013. The partnership of Ocwen and Walter defeated the last bid of $2.91 billion from Fortress Investment Group's Nationstar Mortgage Holdings Inc., which acted as stalking horse bidder, at an auction that began Oct. 23, 2012. The $1.5 billion offer from Warren Buffett's Berkshire Hathaway Inc. was declared the winning bid for a portfolio of loans at the auction on Oct. 25. Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Residential Capital LLC and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). RESIDENTIAL CAPITAL: 25 Highest Paid Employees Won't Get Bonus -------------------------------------------------------------- The Bankruptcy Court authorized Residential Capital LLC and its affiliates to distribute payments under the Residential Capital, LLC Annual Incentive Plan to the eligible employees, other than participants in the KEIP and KERP, so long as the eligible employees receive, in the aggregate, no more than 100% of the award amount approved and authorized by the Compensation Committee of the Debtors' Board of Directors. The Debtors are not allowed to make or accrue any payments under the AIP to employees that qualify as employees whose total compensation ranks them among the top 25 highest paid employees at AFI and its subsidiaries, including the Debtors. The AIP will comply will all the restrictions of Troubled Asset Relief Program, and the Debtors are directed to make revisions as necessary to comply with TARP, including any future determination letter issued by the United States Department of the Treasury's Office of the Special Master. The Debtors will defer 25% of all AIP cash payments to a single Debtor employee that is within the Next 75 who has total cash compensation deemed earned for 2012 of greater than $500,000 for at least one year and also defer 50% of the Next 75 employee's AIP payment for two years, unless otherwise permitted by the OSM. $33+ Million in Bonuses Tracy Hope Davis, the U.S. Trustee for Region 2, opposed ResCap's bid to pay out more than $33 million in normal annual bonuses to more than 75% of its employees. The Justice Department's bankruptcy monitor says while ResCap is presenting the bonuses as an "ordinary course" transaction, the company still needs to disclose enough information to adhere to the bonus requirements set out by the Bankruptcy Code, according to the report. Residential Capital sought under the AIP to pay bonuses to about 3,000 out of 3,926 employees. The U.S. Trustee pointed out that ResCap has not provided information and reasons why it has met the strict requirements of Section 530 of the Bankruptcy Code, which governs bonus and incentive plan payments to employees. The U.S. Trustee complained that with respect to the 185 Key Employee Incentive Plan/Key Employee Retention Plan Participants, the proposed AIP payments to the KEIP Participants are retentive and therefore barred by Section 503(c)(1). Even if the AIP payments to the KEIP Participants were determined to be incentive- based, both the KEIP Participants and the KERP Participants would have to satisfy Section 503(c)(3) and justify the AIP payments, which, at a minimum, would require the Debtors to establish that the previously approved KEIP and KERP awards did not contemplate the entirety of the compensation to be paid to the KEIP/KERP Participants, the U.S. Trustee further argued. AIP Payments In a separate filing, the Official Committee of Unsecured Creditors stated that it has no objection to the Debtors' request to make AIP payments to employees that are not also participating in the KEIP and KERP programs. However, the Committee said it has expressed concerns to the Debtors regarding the amount of the AIP payments requested for employees who are also participating under the KEIP and KERP. The Committee said it is engaging in discussions with the Debtors regarding the amount of the AIP payments for these employees, and the Debtors have assured the Committee that they will continue to negotiate in good faith to achieve a reduction that is acceptable to the Committee prior to the hearing. In the event the negotiations prove unsuccessful, the Committee reserved its right to file an objection to the Motion and raise any objections or issues at the hearing. In response to the U.S. Trustee's objection and the Committee's reservation, the Debtors clarified that, at the time the KEIP/KERP programs were proposed, the Debtors both disclosed that the covered employees would have the ability to earn an AIP award, and provided parties-in-interest with target AIP awards for the KEIP and KERP participants. The KEIP/KERP programs were priced so that the aggregate annual compensation, including the key employee awards, would be consistent with the company's historical market compensation target. In fact, in recognition of the Court's comments in connection with its analysis of the proposed KEIP/KERP Motion, the Debtors took the proactive approach to reduce the AIP pool for KEIP participants by 30% for 2012, and after discussions with the Committee, the Debtors have agreed to further reduce the aggregate AIP pool for KEIP and KERP participants by an additional 10%, which results in (i) an overall reduction of the AIP pool for KEIP participants by 37% and (ii) a reduction of the AIP pool for KERP participants by 10%, as compared to the AIP pool for those same individuals in 2011. Accordingly, the Debtors maintain, the proposed AIP funding levels are appropriate under the circumstances of the Chapter 11 cases, represent a reasonable exercise of their business judgment and should be approved by the Court. About Residential Capital Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. The Bankruptcy Court in November 2012 approved ResCap's sale of its mortgage servicing and origination platform assets to Ocwen Loan Servicing, LLC and Walter Investment Management Corporation for $3 billion; and its portfolio of roughly 50,000 whole loans to Berkshire Hathaway for $1.5 billion. The sale of the assets, subject to satisfaction of customary closing conditions including certain third party consents, is expected to close in the first quarter of 2013. The partnership of Ocwen and Walter defeated the last bid of $2.91 billion from Fortress Investment Group's Nationstar Mortgage Holdings Inc., which acted as stalking horse bidder, at an auction that began Oct. 23, 2012. The $1.5 billion offer from Warren Buffett's Berkshire Hathaway Inc. was declared the winning bid for a portfolio of loans at the auction on Oct. 25. Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Residential Capital LLC and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). RESIDENTIAL CAPITAL: Feb. 28 Hearing on Payments to PwC ------------------------------------------------------- The Bankruptcy Court entered a second interim order authorizing Residential Capital LLC and its affiliates to compensate PricewaterhouseCoopers LLP for services rendered in connection with the FRB Foreclosure Review. A final hearing on the Debtors' request to pay PwC is scheduled for February 28, 2013. As reported in the Oct. 2 edition of the TCR, the Official Committee of Unsecured Creditors opposed the Debtors' request to pay $250 million in fees to PricewaterhouseCoopers for mortgage foreclosure review services raises serious questions regarding the best interests of the estates, not the least of which is why the Debtors -- or federal regulators, for that matter -- should prefer to continue these vast expenditures rather than to devise a more streamlined method to redirect more money to pay borrowers. A subsequent filing said the Creditors Committee has agreed for GMAC Mortgage LLC to pay PwC, and two other firms during the 90 days following entry of interim orders. The TCR reported in September 2012 that in connection with the agreement with Residential Capital, Ally Financial Inc. and Ally Bank to develop and implement risk management and corporate governance procedures in order to ensure prospective compliance with applicable foreclosure-related regulations and laws, Debtor GMAC Mortgage LLC agreed to pay for an extensive, independent file review regarding certain residential foreclosure actions and foreclosure sales prosecuted by the Debtors. Pursuant to the FRB Foreclosure Review requirement, the Debtors hired PricewaterhouseCoopers, LLP, as independent consultant. PwC has been tasked with (i) working to plan and develop procedures for conducting the FRB Foreclosure Review; (ii) identifying loan populations for review; (iii) monitoring a borrower outreach complaint process; (iv) reviewing a sample of more than 5,000 loan files, as well as more than 12,000 borrower outreach complaints, for missing documentation or other issues; and (v) developing a recommended remediation in the event that PwC identifies errors. Accordingly, the Debtors sought the Court's authority to employ PwC under Section 363 of the Bankruptcy Code and pay the firm for the services it rendered before and after the Petition Date. The Debtors agreed to pay PwC according to the firm's hourly rates: Partner $630 Managing Director $610 Senior Manager/Director $470 Manager $370 Senior Associate $300 Associate $235 The Debtors estimated that the cost of the FRB Foreclosure Review could reach approximately $180 million, although based on subsequent events, it has become apparent that the costs of compliance with the FRB Foreclosure Review could increase well above that amount, perhaps reaching $250 million. About Residential Capital Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. The Bankruptcy Court in November 2012 approved ResCap's sale of its mortgage servicing and origination platform assets to Ocwen Loan Servicing, LLC and Walter Investment Management Corporation for $3 billion; and its portfolio of roughly 50,000 whole loans to Berkshire Hathaway for $1.5 billion. The sale of the assets, subject to satisfaction of customary closing conditions including certain third party consents, is expected to close in the first quarter of 2013. The partnership of Ocwen and Walter defeated the last bid of $2.91 billion from Fortress Investment Group's Nationstar Mortgage Holdings Inc., which acted as stalking horse bidder, at an auction that began Oct. 23, 2012. The $1.5 billion offer from Warren Buffett's Berkshire Hathaway Inc. was declared the winning bid for a portfolio of loans at the auction on Oct. 25. Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Residential Capital LLC and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). RLD INC: Court Enters Final Decree Closing Reorganization Case -------------------------------------------------------------- The Hon. Alan Jarovsky of the U.S. Bankruptcy Court of the Northern District of California entered a final decree closing the Chapter 11 case of RLD, INC. On Aug. 22, 2012, the Debtor confirmed the Plan dated April 6, 2012, which provides that holders of secured claims will be paid in full, or, otherwise, will retain the real property collateral in full satisfaction of said allowed claim. Unsecured claims are to be paid the aggregate sum of $150,000, in monthly installments of $3,000, distributed on a pro rata basis to the holders on a quarterly basis, with the balance paid in full within one year of the revesting of the Lorraine E. Ring bankruptcy estate's property in Lorraine E. Ring. Holders of allowed interests will retain the interests subject to the terms of the Plan. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/RLD_INC_ds.pdf About RLD Inc. RLD, Inc., based in Santa Rosa, California, filed for Chapter 11 bankruptcy (Bankr. N.D. Calif. Case No. 11-14071) on Nov. 7, 2011. Judge Alan Jaroslovsky presides over the case. The Law Offices of Steven M. Olson serves as the Debtor's counsel. The Debtor disclosed $10,824,405 in assets and $19,304,145 in liabilities as of the Petition Date. Under the Plan, holders of secured claims will be paid in full, or, otherwise, will retain the real property collateral in full satisfaction of said allowed claim. Unsecured claims will be paid the aggregate sum of $150,000, in monthly installments of $3,000, distributed on a prorata basis to the holders on a quarterly basis, with the balance paid in full within one year of the revesting of the Lorraine E. Ring bankruptcy estate's property in Lorraine E. Ring. SEARS HOLDINGS: Kmart Presents Challenge ---------------------------------------- The Wall Street Journal's Dana Mattioli reports Edward Lampert -- who in early January announced he would take on the additional title of Sears Holdings chief executive after the current CEO said he would be stepping down in February -- will have to deal with Kmart, the retailer he bought out of bankruptcy. Kmart has stumbled in recent quarters because of increased competition, missteps in its grocery business and turf battles. The report notes Kmart, which accounted for about 37% of Sears Holdings' 2011 revenue and is the asset upon which Mr. Lampert built his department-store empire over the past decade, is watching its sales move in the wrong direction. WSJ relates Gary Balter, a retail analyst at Credit Suisse, described Kmart as "terminally challenged" in a recent research report. "What's Kmart's strength?" he said in an interview. "There isn't one to speak of." Mr. Lampert gained control of Kmart in 2003 after buying up its debt while the retailer was in bankruptcy proceedings. Then, two years later, he combined it with Sears in a $12.3 billion deal. About Sears Hoffman Estates, Illinois-based Sears Holdings Corporation (Nasdaq: SHLD) -- http://www.searsholdings.com/-- operates full- line and specialty retail stores in the United States and Canada. Sears Holdings operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a 94% stake in Sears Canada and an 80.1% stake in Orchard Supply Hardware. Key proprietary brands include Kenmore, Craftsman and DieHard, and a broad apparel offering, including such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer, as well as the Apostrophe and Covington brands. It also has the Country Living collection, which is offered by Sears and Kmart. Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6, 2003, pursuant to the terms of an Amended Joint Plan of Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represented the retailer in its restructuring efforts. The Company's balance sheet showed $16,287,000,000 in assets and $10,348,000,000 in debts when it sought chapter 11 protection. Kmart bought Sears, Roebuck & Co., for $11 billion to create the third-largest U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in annual revenues. Kmart completed its merger with Sears on March 24, 2005. The Company's balance sheet at Oct. 27, 2012, showed $21.80 billion in total assets, $17.90 billion in total liabilities and $3.90 billion in total equity. Negative Outlook Standard & Poor's Ratings Services in January 2012 lowered its corporate credit rating on Hoffman Estates, Ill.-based Sears Holdings Corp. to 'CCC+' from 'B'. "We removed the rating from CreditWatch, where we had placed it with negative implications on Dec. 28, 2011. We are also lowering the short-term and commercial paper rating to 'C' from 'B-2'. The rating outlook is negative," S&P said. "The corporate credit rating reflects our projection that Sears' EBITDA will be negative in 2012, given our expectations for continued sales and margin pressure," said Standard & Poor's credit analyst Ana Lai. She added, "We further expect that liquidity could be constrained in 2013 absent a turnaround or substantial asset sales to fund operating losses." Moody's Investors Service in January 2012 lowered Sears Holdings Family and Probability of Default Ratings to B3 from B1. The outlook remains negative. At the same time Moody's affirmed Sears' Speculative Grade Liquidity Rating at SGL-2. The rating action reflects Moody's expectations that Sears will report a significant operating loss in fiscal 2011. Moody's added that the rating action also reflects the company's persistent negative trends in sales, which continue to significantly underperform peers. As reported by the TCR on Dec. 7, 2012, Fitch Ratings has affirmed its long-term Issuer Default Ratings (IDR) on Sears Holdings Corporation (Holdings) and its various subsidiary entities (collectively, Sears) at 'CCC' citing that The magnitude of Sears' decline in profitability and lack of visibility to turn operations around remains a major concern. SINO-FOREST CORP: Plan Implementation Date Expected for Jan. 29 --------------------------------------------------------------- Sino-Forest Corporation on Jan. 24 announced that the Plan Implementation Date, the date on which the Company's CCAA Plan of Compromise and Reorganization dated December 3, 2012 is to become effective, has been extended with the consent of the Initial Consenting Noteholders and the Monitor. While Sino-Forest has been working diligently with the Monitor and counsel to the Initial Consenting Noteholders to complete the implementation of the Plan, certain additional work is still necessary before the Plan can become effective. The Plan Implementation Date is now expected to occur on or about January 29, 2013 and in any event before the end of January, 2013. About Sino-Forest Corp. Sino-Forest Corporation -- http://www.sinoforest.com/-- is a commercial forest plantation operator in China. Its principal businesses include the ownership and management of tree plantations, the sale of standing timber and wood logs, and the complementary manufacturing of downstream engineered-wood products. Sino-Forest also holds a majority interest in Greenheart Group Limited, a Hong-Kong listed investment holding company with assets in Suriname (South America) and New Zealand and involved in sustainable harvesting, processing and sales of its logs and lumber to China and other markets around the world. Sino-Forest's common shares have been listed on the Toronto Stock Exchange under the symbol TRE since 1995. Sino-Forest Corporation on March 30, 2012, obtained an initial order from the Ontario Superior Court of Justice for creditor protection pursuant to the provisions of the Companies' Creditors Arrangement Act. Under the terms of the Order, FTI Consulting Canada Inc. will serve as the Court-appointed Monitor under the CCAA process and will assist the Company in implementing its restructuring plan. Gowling Lafleur Henderson LLP is acting as legal counsel to the Monitor. During the CCAA process, Sino-Forest expects its normal day-to- day operations to continue without interruption. The Company has not planned any layoffs and all trade payables are expected to remain unaffected by the CCAA proceedings. SOUTHERN AIR: Taps Byron Advisors as Independent Contractor ----------------------------------------------------------- Southern Air Holdings, Inc., et al., ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Byron Advisors, LLC as an independent contractor to provide management services to the Debtors; and designate William B. Murphy as chief restructuring officer. Byron Advisors and Mr. Murphy will, among other things: -- oversee and assist the Debtors with preparation of proposed and final financial forecasts/budgets for 2013 and subsequent years; -- assist in the preparation of financial reporting and corresponding business planning and capital allocations in accordance with the Debtors' chapter 11 plan; and -- maintain the Debtors' relationship with the lenders and the Creditors Committee. The parties agree to this compensation structure: 1) The Debtors will pay a $20,000 retainer upon execution of the CRO Agreement. 2) In exchange for the CRO services, the Debtors will pay Byron Advisors $20,000 bi-weekly, for an aggregate monthly payment of $40,000. 3) The Debtors will reimburse all reasonable, incidental and related expenses. To the best of the Debtors' knowledge, Bryon Advisors is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A hearing on Jan. 29, 2013 at 10 a.m. has been set. About Southern Air Based in Norwalk, Connecticut, military cargo airline Southern Air Inc. -- http://www.southernair.com/-- its parent Southern Air Holdings Inc. and their affiliated entities filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 12-12690 to 12-12707) in Wilmington on Sept. 28, 2012, blaming the decline in business from the U.S. Department of Defense, which reduced its troop count in Afghanistan and hired Southern Air less frequently. Bankruptcy Judge Christopher S. Sontchi presides over the case. Brian S. Rosen, Esq., Candace Arthur, Esq., and Gabriel Morgan, Esq., at Weil, Gotshal & Manges LLP; and M. Blake Cleary, Esq., and Maris J. Kandestin, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtor's counsel. Zolfo Cooper LLC serves as the Debtors' bankruptcy consultant and special financial advisor. Kurtzman Carson Consultants, LLC, serves as claims and notice agent. CF6-50, LLC, debtor-affiliate, disclosed $338,925,282 in assets and $288,000,000 in liabilities as of the Chapter 11 filing. The petition was signed by Jon E. Olin, senior vice president. Canadian Imperial Bank of Commerce, New York Agency, the DIP agent and prepetition agent, is represented by Matthew S. Barr, Esq., and Samuel Khalil, Esq., at Milbank Tweed Hadley & McCloy LLP; and Mark D. Collins, Esq., and Katherine L. Good, Esq., at Richards Layton & Finger PA. Stephen J. Shimshak, Esq., and Kelley A. Cornish, Esq., at Paul Weiss Rifkind Wharton & Garrison LLP; and Mark E. Felger, Esq., at Cozen O'Connor, represent Oak Hill Capital Partners II, LP, OH Aircraft Acquisition LLC, and Oak Hill Cargo 360 LLC. The Debtors' Plan provides that lenders agreed to accept ownership of the company as payment for their $288 million loan. On Nov. 21, 2012, Roberta DeAngelis, U.S. Trustee for Region 3, appointed the statutory committee of unsecured creditors. Lowenstein Sandler PC now known as Lowenstein Sandler LLP and Pachulski, Stang, Ziehl & Jones LLP serves as its co- counsels, and Mesirow Financial Consulting LLC serves as its financial advisor. SPIRIT REALTY: To Merge with Cole Credit Property Trust ------------------------------------------------------- Spirit Realty Capital, Inc., and Cole Credit Property Trust II announced that their Boards of Directors have unanimously approved a definitive agreement to merge their companies to create the second largest publicly traded triple-net-lease REIT in the United States with a pro forma enterprise value of approximately $7.1 billion. The combined company, which will retain the Spirit Realty name and trade on the New York Stock Exchange under the ticker symbol "SRC," will own or have an interest in 2,012 properties in 48 states. It will have a significantly enhanced scale and scope, a more broadly diversified portfolio of high-quality real estate assets and enhanced access to capital. The current management team of Spirit Realty will lead the combined company. The transaction is expected to close in the third quarter of 2013. "This merger significantly accelerates Spirit Realty's business strategy and better positions us to deliver long-term value to our shareholders," said Thomas H. Nolan, Jr., chairman and chief executive officer of Spirit Realty. "CCPT II's portfolio represents one of the largest and highest-quality portfolios of net lease assets. The addition of CCPT II's portfolio effectively doubles the size of our portfolio. As a result, the merger further diversifies us both geographically and by industry, reduces our tenant concentration, improves the overall credit quality of our portfolio and increases operating efficiency. We also expect the merger to enhance our access to the capital markets and better position us to take advantage of consolidation opportunities in the net lease space. We are excited about the outlook for the triple-net industry and about our position in it, and we look forward to delivering attractive and stable value to shareholders of our combined company." Christopher H. Cole, founder and executive chairman of Cole, said, "The independent directors of the CCPT II Board, with the assistance of legal and financial advisors, thoroughly evaluated potential options to maximize value for our shareholders. We are confident that this transaction is in the best interest of all shareholders. As of the date of this announcement, it represents a positive cumulative total return on their investment and provides an opportunity for liquidity in what will be one of the largest publicly traded net lease REITs. Despite operating through a challenging time in the real estate cycle, we are pleased with the value this provides our investors. Our disciplined investment philosophy of acquiring high-quality, income producing properties, net-leased to long term creditworthy tenants, was the foundation that allowed the CCPT II portfolio of assets to deliver great results. With this transaction, Spirit Realty shareholders will own a best-in-class portfolio." The merger of Spirit Realty and CCPT II creates a number of significant financial and operational benefits: * Additional Size and Scale: The combination of the Spirit Realty and CCPT II portfolios will create a sector-leading public company with 2,012 properties across 48 states. The company will have the added scale and financial flexibility to competitively pursue additional properties and generate increased capital appreciation from its targeted real estate investments. * Broadened Tenant Credit Profile: The combined portfolio will consist of sub-investment grade, investment grade and non- rated properties. Spirit Realty's investment strategy will be expanded with the addition of CCPT II's portfolio. The new portfolio will have a broader, more diverse credit profile with attractive risk/return characteristics that Spirit Realty believes will offer more opportunities for value creation. The lease profile of the combined company will be highly attractive, consisting of many investment grade tenants and a weighted average lease term of 10.6 years, supported by Spirit Realty's proven and disciplined credit analysis and investment process. * Diversified Tenant Base: The top ten tenants of the combined portfolio will represent approximately 37% of the total portfolio, down from approximately 52% in Spirit Realty's standalone portfolio. The largest tenant will represent approximately 16% of the total portfolio. Additionally, lease revenues will be more broadly diversified across industries and geography. Further, approximately 19% of the rental revenue of the combined portfolio will come from tenants with investment grade ratings. * Operating Expenses Absorbed Across a Larger Portfolio: By doubling the size of the portfolio without significantly increasing administrative expenses and assuming CCPT II's asset manager function, the company will achieve materially greater operating efficiencies. * Increased Financial Strength and Flexibility: As a larger company, the new company will be able to optimize its balance sheet and employ cost-effective equity and debt financing available in the public markets, generating higher growth metrics while increasing stability. Pursuant to the terms of the merger agreement, Spirit Realty shareholders will receive a fixed exchange ratio of 1.9048 CCPT II shares for each share of Spirit Realty common stock owned (equates to 0.525 Spirit Realty shares for each share of CCPT II). The combined company will immediately list its common shares on the NYSE and will trade under Spirit Realty's existing ticker SRC. Based on Spirit Realty's closing price of $17.82 per share on Jan. 18, 2013, the exchange ratio implies a value of $9.36 per CCPT II share and reflects a positive cumulative total return including dividends of 20-42% for shareholders of CCPT II, depending on the shareholder holding period. When compared to the volume weighted average price of Spirit's share price from the date of its inclusion in the Russell 2000 Index through the closing price on Jan. 18, 2013, which was $17.66, the exchange ratio implies a value of $9.27 per CCPT II share. Based on the volume weighted average price of Spirit Realty over the last 20 trading days of $17.47 per share, the exchange ratio implies a value of $9.17 per CCPT II share. Following the close, CCPT II shareholders are expected to own approximately 56% and Spirit Realty shareholders approximately 44% of the common shares of the combined REIT. Spirit Realty's largest shareholders, Macquarie Capital and TPG-Axon, who together own approximately 15% of Spirit Realty, have executed agreements that state their intention to vote in favor of the transaction. The transaction is expected to be slightly accretive to Spirit Realty's funds from operations per share following closing, pending completion of the company's purchase accounting analysis. Shareholders can expect to continue to see, without disruption, a dividend distribution from their investment. CCPT II will pay no internalization fee or transaction fees to Cole. The combined company will continue to employ Spirit Realty's proven credit analysis and asset management skill set. The combined company will have a nine-member board of directors, seven of whom will be existing board members of Spirit Realty and two who will be representatives from CCPT II. The completion of the transaction is subject to the receipt of approval of the majority of shares outstanding of Spirit Realty and CCPT II and customary regulatory approvals and closing conditions. A joint proxy statement/prospectus will be filed on Form S-4 with the Securities and Exchange Commission, which will describe the proposed merger. Barclays served as financial advisor to Spirit Realty, and Latham & Watkins LLP served as legal advisor to Spirit Realty. Morgan Stanley and UBS Investment Bank served as financial advisors to CCPT II, and Goodwin Procter LLP served as legal advisor to CCPT II. Gleacher & Company served as financial advisor to the Special Committee of CCPT II and Ropes & Gray LLP served as legal advisor to the Special Committee of CCPT II. Spirit Realty and Cole Credit provided certain information regarding the announcement the Agreement and Plan of Merger, dated as of Jan. 22, 2013. The slides used in connection with this analyst and investor presentation are available at: http://is.gd/HD3yBN About Spirit Finance Spirit Finance Corporation (now known as Spirit Realty Capital, Inc.) headquartered in Phoenix, Arizona, is a REIT that acquires single-tenant, operationally essential real estate throughout United States to be leased on a long-term, triple-net basis to retail, distribution and service-oriented companies. The Company's balance sheet at Sept. 30, 2012, showed $3.20 billion in total assets, $1.98 billion in total liabilities and $1.22 billion in total stockholders' equity. * * * As reported by the TCR on Oct. 9, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Spirit Realty Capital Inc. (Spirit) to 'B' from 'CCC+'. "The upgrade reflects Spirit Realty Capital Inc.'s successful completion of an IPO of its common stock, which raised $465 million of net proceeds," said credit analyst Elizabeth Campbell. In the Sept. 15, 2011, edition of the TCR, Moody's Investors Service affirmed the corporate family rating of Spirit Finance Corporation at Caa1. "This rating action reflects Spirit's consistent compliance with its term loan covenants throughout the downturn (despite relatively thin cushion at certain times), as well as the recent debt paydown which, in Moody's view, will help Spirit remain in compliance within the stated covenant limits going forward." STEREOTAXIS INC: Offering 790,000 Shares Under Incentive Plan ------------------------------------------------------------- Stereotaxis, Inc., filed a Form S-8 registration statement with the U.S. Securities and Exchange Commission registering 790,000 shares of common stock under the Company's 2012 Stock Incentive Plan for a proposed maximum aggregate offering is $1.6 million. A copy of the prospectus is available at http://is.gd/wWAFyy About Stereotaxis Based in St. Louis, Mo., Stereotaxis, Inc., designs, manufactures and markets the Epoch Solution, which is an advanced remote robotic navigation system for use in a hospital's interventional surgical suite, or "interventional lab", that the Company believes revolutionizes the treatment of arrhythmias and coronary artery disease by enabling enhanced safety, efficiency and efficacy for catheter-based, or interventional, procedures. For the year ended Dec. 31, 2011, Ernst & Young LLP, in St. Louis, Missouri, expressed substantial doubt about Stereotaxis' ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring operating losses and has a working capital deficiency. The Company reported a net loss of $32 million for 2011, compared with a net loss of $19.9 million for 2010. The Company's balance sheet at Sept. 30, 2012, showed $35.17 million in total assets, $50.42 million in total liabilities and a $15.25 million total stockholders' deficit. SUPERMEDIA INC: Director David Hawthorne Dies at 62 --------------------------------------------------- SuperMedia Chairman of the Board Doug Wheat announced the passing of David E. Hawthorne, a member of the company's Board of Directors since 2009, on Friday, Jan. 18, at the age of 62. "David was a colleague and friend to many of us," Wheat said. "He was a valued member of the Board of Directors, and we will miss his spirit and insights." Mr. Hawthorne served on several committees of the SuperMedia board, including the Compensation Committee and Audit Committee. He had led Hawthorne Management LLC since 2005, a firm that develops, owns, and operates commercial real estate in central Florida. He previously served as a consultant to Friedman's Inc., assisting the jewelry retailer in investigating operating and financial issues. From 2001 to 2003, Hawthorne was the President and Chief Executive Officer of Lodgian, Inc., an independent hotel owner and operator. Mr. Hawthorne was a consultant for FTI Consulting, Inc., from 2000 to 2001, during which time he served as Executive Vice President and Chief Restructuring Officer of Tower Records, Inc. Mr. Hawthorne also served as the acting Chief Executive Officer of Premier Cruise Lines, the Executive Vice President and Chief Financial Officer of Alliance Entertainment Corporation, and the Chairman and Chief Executive Officer of Servico Hotels and Resorts, Inc. About Supermedia Inc. Headquartered in D/FW Airport, Texas, Idearc, Inc., now known as SuperMedia Inc., is the second largest U.S. yellow pages publisher. Idearc was spun off from Verizon Communications, Inc. Idearc and its affiliates filed for Chapter 11 protection (Bankr. N.D. Tex. Lead Case No. 09-31828) on March 31, 2009. The Debtors' financial condition as of Dec. 31, 2008, showed total assets of $1,815,000,000 and total debts of $9,515,000,000. Toby L. Gerber, Esq., at Fulbright & Jaworski, LLP, represented the Debtors in their restructuring efforts. The Debtors tapped Moelis & Company as their investment banker; Kurtzman Carson Consultants LLC as their claims agent. William T. Neary, the United States Trustee for Region 6, appointed six creditors to serve on the official committee of unsecured creditors. The Committee selected Mark Milbank, Tweed, Hadley & McCloy LLP, as counsel, and Haynes and Boone, LLP, co- counsel. Idearc completed its debt restructuring and its plan of reorganization became effective as of Dec. 31, 2009. In connection with its emergence from bankruptcy, Idearc changed its name to SuperMedia Inc. Under its reorganization, Idearc reduced its total debt from more than $9 billion to $2.75 billion of secured bank debt. Less than two years since leaving bankruptcy protection, SuperMedia remains in quandary. Early in October 2011, Moody's Investors Service slashed its corporate family rating for SuperMedia to Caa1 from B3 prior. The downgrade reflects Moody's belief that revenues will continue to decline at a double digit rate for the foreseeable future, leading to a steady decline in free cash flow. SuperMedia's sales were down 17% for the second quarter of 2011 in a generally improving advertising sector. Moody's ratings outlook for SuperMedia remains negative. While SuperMedia is attempting to transition the business away from its reliance on print advertising through development of online and mobile directory service applications, Moody's is increasingly concerned that the company will not be able to make this change quickly enough to stabilize the revenue base over the intermediate term. Further, the high fixed cost nature of SuperMedia's business could lead to steep margin compression, notwithstanding continued aggressive cost management. The Company's balance sheet at Sept. 30, 2012, showed $1.44 billion in total assets, $1.91 billion in total liabilities, and a $470 million total stockholders' deficit. TCI COURTYARD: Can Access Trust Cash Collateral Until Feb. 28 ------------------------------------------------------------- On Jan. 24, 2013, the U.S. Bankruptcy Court for the Northern District of Texas entered an agreed interim order authorizing TCI Courtyard, Inc., to use cash collateral of the Trust, to pay the actual, ordinary, necessary and reasonable expenses in accordance with an Operating Budget, until Feb. 28, 2013. As of Petition Date, the Debtor is obligated to CWCapital Asset Management LLC, solely in its capacity as Special Servicer for Wells Fargo Bank, N.A., f/k/a Wells Fargo Bank Minnesota, N.A., as Trustee for the Registered Holders of J.P. Morgan Chase Commercial Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates, Series 2001-C1 (the "Trust") pursuant to that certain Promissory Note dated as of Sept. 28, 2001, in the original principal amount of $12,360,000. Beginning on Dec. 1, 2012, the Debtor will make adequate protection payments to the Trust in the amount totaling $55,416.67. The Trust is granted a first priority replacement lien upon all of the Debtor's after acquired tangible and intantible real and personal property and related proceeds, but excluding all causes of action under Chapter 5 of the Bankruptcy Code and excluding assets acquired after confirmation of a Chapter 11 plan. Attorneys for CWCapital Asset Management, LLC, may be reached at: Brent Procida, Esq. VENABLE, LLP 750 E. Pratt Street, Suite 900 Baltimore, MD 21202 - and - Susan B. Hersh, Esq. SUSAN B. HERSCH, P.C. State Bar of Texas 09543925 12770 Coit Road, Suite 1100 Dallas, TX 75251 About TCI Courtyard Dallas, Texas-based TCI Courtyard, Inc., dba Quail Hollow Apartments, filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case No. 12-37284) on Nov. 15, 2012. Judge Stacey G. Jernigan presides over the case. Eric A. Liepins, Esq., serves as the Debtor's counsel. In its petition, the Debtor scheduled $13,790,254 in assets and $15,964,116 in liabilities. The petition was signed by Steven Shelley, vice president. According to Troubled Company Reporter's records, TCI Courtyard previously filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 11-34977) on Aug. 1, 2011. The Liepins firm also served as counsel in the previous case. The Debtor estimated assets of up to $10 million and debts of up to $50 million in the 2011 petition. TELETOUCH COMMUNICATIONS: Had $424,000 Net Loss in Nov. 30 Qtr. --------------------------------------------------------------- Teletouch Communications, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $424,000 on $5 million of total operating revenues for the three months ended Nov. 30, 2012, compared with net income of $7.78 million on $6.27 million of total operating revenues for the same period during the prior year. For the six months ended Nov. 30, 2012, the Company reported a net loss of $632,000 on $10.22 million of total operating revenues, compared with net income of $7.01 million on $13.76 million of total operating revenues for the same period a year ago. The Company's balance sheet at Nov. 30, 2012, showed $11.35 million in total assets, $18.11 million in total liabilities and a $6.75 million total shareholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/TmyJZF About Teletouch Teletouch Communications, Inc., offers a comprehensive suite of wireless telecommunications solutions, including cellular, two-way radio, GPS-telemetry and wireless messaging. Teletouch is an authorized provider of AT&T (NYSE: T) products and services (voice, data and entertainment) to consumers, businesses and government agencies, as well as an operator of its own two-way radio network in Texas. Recently, Teletouch entered into national agency and distribution agreements with Sprint (NYSE: S) and Clearwire (NASDAQ: CLWR), providers of advanced 4G cellular network services. Teletouch operates a chain of 26 retail and agent stores under the "Teletouch" and "Hawk Electronics" brands, in conjunction with its direct sales force, customer care (call) centers and various retail eCommerce Web sites including: http://www.hawkelectronics.com/and http://www.hawkexpress.com/ Through its wholly-owned subsidiary, Progressive Concepts, Inc., Teletouch operates a national distribution business, PCI Wholesale, primarily serving large cellular carrier agents and rural carriers, as well as auto dealers and smaller consumer electronics retailers, with product sales and support available through http://www.pciwholesale.com/and http://www.pcidropship.com/among other B2B oriented Web sites. BDO USA, LLP, in Houston, Texas, issued a "going concern" qualification on the consolidated financial statement for the year ended May 31, 2012. The independent auditors noted that the Company has increasing working capital deficits, significant current debt service obligations, a net capital deficiency along with current and predicted net operating losses and negative cash flows which raise substantial doubt about its ability to continue as a going concern. TEN SAINTS: Combined Hearing on Plan to Begin Feb. 4 ---------------------------------------------------- The Ten Saints, LLC and Wells Fargo Bank, N.A. have obtained Bankrutpcy Court approval of a stipulation that sets for various deadlines in connection with the Debtor's Plan of Reorganization, amended as of Sept. 25, 2012: Jan. 23, 2013, at 9:30 a.m. Pre-trial conference Feb. 4, 11 and 12 Combined hearing for approval of the Disclosure Statement and confirmation of the Plan Jan. 28 Deadline for all direct testimony, declarations an related exhibits presented for fact witnesses by declaration and by experts through the admission of expert reports into evidence at the confirmation hearing. Jan. 25 Deadline for final lists of witnesses and exhibits Jan. 28 Deadline for objections to the final lists of witnesses and exhibits Jan. 30 Deadline for replies to objections The stipulation also provided that Wells Fargo's objection to confirmation of the Plan are due Jan. 18, and reply thereto is due Jan. 28. Amended Plan of Reorganization As reported in the Dec. 5, 2012 edition of the TCR, the Plan provides that all of the Debtor's assets will vest in the Reorganized Debtor, which will continue to exist as a separate entity in accordance with applicable law. On the Effective Date (i) the Amended and Restated Note will be executed by Reorganized Debtor and delivered to secured lender; and (ii) the loan documents will remain in full force and effect, save and expect that without any further action by Reorganized Debtor or secured lender, all of the loan documents will be deemed to have been amended. The Plan provides for this treatment of claims: (a) Secured Lender Claim I($14,488,705) -- On the Effective Date, all pre-Effective Date defaults under the loan documents will be deemed to have been cured and on the Effective Date, Debtor or Reorganized Debtor will be current and in good standing under the loan documents. Additionally, on the Effective Date, the loan documents will remain in full force and effect. (b) Priority Unsecured Claims ($0) -- will be paid in full, in cash, on the latest of: (i) the Effective Date, or soon thereafter as is practical; (ii) the date as may be fixed by the Bankruptcy Court, or as soon thereafter as is practicable; (iii) the 14th business day after the claim is allowed, or as soon thereafter as is practicable; or (iv) the date as the holder of the claim and Reorganized Debtor has agreed or will agree. (c) General Unsecured Claims ($212,000) -- each creditor with an Allowed General Unsecured Claim will be paid in full with interest at the Unsecured Interest Rate, which is 3% per annum, through Distributions tendered by Reorganized Debtor. (d) The Holders of Equity Securities of Debtor will retain all of their legal interests. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/TEN_SAINTS_ds_amendedplan.pdf About Ten Saints Four related Las Vegas, Nevada-based entities sought Chapter 11 bankruptcy protection on July 13, 2011. The businesses are owned or managed by local business people and firms, including Todd Nigro, Nigro Development LLC, a Nigro family trust and other investors. Horizon Village Square LLC (Bankr. D. Nev. Case No. 11-21034) owns the Vons-anchored Horizon Village Square Shopping Center near I-515 and Horizon Drive in Henderson. The property includes five retail buildings with nearly 43,000 square feet of space. Ten Saints LLC (Bankr. D. Nev. Case No. 11-21028) owns the 134- room Hampton Inn & Suites at St. Rose Parkway and Seven Hills Drive in Henderson. Beltway One Development Group LLC (Bankr. D. Nev. Case No. 11- 21026) owns the Desert Canyon Business Park at Russell Road and the Las Vegas Beltway. It has two buildings and 15 acres. Nigro HQ LLC (Bankr. D. Nev. Case No. 11-21014) owns an office building at 9115 W. Russell Road occupied by Bank of George, Infinity Plus LLC and Nigro Construction Inc. Todd Nigro said the four bankruptcies were caused by threatened foreclosures -- typically related to Wells Fargo Bank demanding payments to keep loan-to-value ratios at specified levels. Judge Mike K. Nakagawa presides over the cases. Lawyers at Gordon Silver serve as the Debtors' bankruptcy counsel. The bankruptcy petitions estimated assets and debts from $1 million to $10 million each for Nigro HQ; and from $10 million to $50 million in both assets and debts for Horizon Village, Ten Saints and Beltway One. The cases are not jointly administered. A fifth related business, Russell Boulder LLC, filed for bankruptcy (Bankr. D. Nev. Case No. 10-29724) on Oct. 19, 2010. It owns the 600-suite Siena Suites extended stay property at Boulder Highway and Russell Road. Edward M. Zachary, Esq., at Bryan Cave LLP, in Bryan Cave LLP, in Phoenix, Ariz., and Robert M. Charles, Jr., Esq., at Lewis and Roca LLP, in Los Vegas, Nev., represent Wells Fargo Bank, N.A., as counsel. TENET HEALTHCARE: Fitch Assigns 'BB' Rating to Sr. Secured Notes ---------------------------------------------------------------- Fitch Ratings has assigned a 'BB/RR1' rating to Tenet Healthcare Corp.'s 4.5% senior secured notes due 2021. The ratings apply to approximately $4.9 billion of debt at Sept. 30, 2012. The Rating Outlook is Stable. Tenet will use the proceeds of the $850 million senior secured notes issuance to retire $714 million of its 10% senior secured notes due 2018 in a tender offer. The balance will be used for general corporate purposes, including acquisitions, share repurchases and retirement of debt outstanding under its bank revolving credit facility. RATING SENSITIVITY/KEY RATING DRIVERS: -- While Tenet's liquidity and financial flexibility have incrementally improved, the company continues to exhibit industry- lagging profitability and negative free cash flow (FCF, cash from operations less capital expenditures, dividends and distributions). -- Tenet's liquidity profile is otherwise solid. Debt maturities are small until 2015, the company has adequate available liquidity in cash on hand and credit revolver availability, and there are no financial maintenance covenants in effect under its debt agreements. -- Weak organic patient utilization trends in the for-profit hospital industry have persisted despite the stabilization of unemployment rates. Fitch expects this trend to continue until the boost in patient volumes anticipated under the Affordable Care Act starting in 2014. -- Fitch believes that Tenet's capital deployment strategy will become more aggressive in the near term, focused on share repurchases and acquisitions that will likely require additional debt funding. DECENT HEADROOM IN CREDIT METRICS Tenet's credit metrics, including debt leverage and interest coverage, provide decent headroom relative to the 'B' IDR. Pro forma for the company's fourth quarter 2012 (4Q'12) financing activities and assuming the retirement of the $714 million secured notes due 2018, Fitch calculates gross debt-to-EBITDA of 4.6x and EBITDA-to-interest expense of 3.1x. Leverage through Tenet's secured debt will increase to 2.8x EBITDA from 2.6x at June 30, 2012. Earlier in 4Q'12, Tenet announced plans to fund up to $500 million of share repurchases through the end of 2013 as well as up to $400 million of acquisitions. The company's issuance of $800 million in notes in October 2012, as well as this week's note issuance, will provide some dry powder for its capital deployment initiatives. However, Fitch believes further debt would be necessary to fully fund these objectives, since FCF is not anticipated to be a significant source of funds in 2013. IMPROVING FINANCIAL FLEXIBILITY Tenet recently made progress in extending debt maturities and refinancing some of its higher cost debt. In November 2011, Tenet issued $900 million of 6.25% senior secured notes due 2018 and used a portion of the proceeds to refund the $714 million 9% senior secured notes maturing 2015. Also in November 2011, Tenet entered into an amendment to its credit facility, extending final maturity by one year, to November 2016. There is a springing maturity under the bank facility to fourth-quarter 2014 unless the company refinances or repays $238 million of its $474 million 9.25% senior notes maturing 2015. Tenet's debt agreements do not include financial maintenance covenants, except for a 2.1x fixed-charge coverage ratio test under the bank facility that is in effect whenever availability under the revolver is less than $80 million (at Sept. 30, 2012, availability was $430 million). Tenet does have capacity for additional debt under its debt agreements. The senior secured note indentures limit the company's ability to issue additional secured debt. Secured debt is permitted up to the greater of (i) $3.2 billion and (ii) 4.0x EBITDA ($4.6 billion at Sept. 30, 2012). Debt secured on a basis pari passu to the secured notes is limited to the greater of (i) $2.6 billion and (ii) 3.0x EBITDA ($3.5 billion at Sept. 30, 2012). Prior to this week's financing activities, Fitch estimated that Tenet has about $1.4 billion of incremental total secured debt capacity and $300 million in first lien secured debt capacity. STRAINED FCF PROFILE While Tenet generates strong and consistent cash from operations, the company has been unable to generate positive FCF since the middle of last decade. Fitch believes that Tenet's inability to generate FCF stems from several issues, most notably its industry- lagging profitability and relatively high cash interest expense on some of its debt issues. While the company has made incremental progress in addressing these issues, its negative FCF profile remains the most important credit risk. In the LTM ended Sept. 30, 2012, Tenet produced FCF of negative $44 million. Although the company continues to consume cash, the degree of cash burn has improved significantly since 2006. The company's negative FCF in recent periods was influenced by an increase in accounts receivable due to the delay of state Medicaid payments and provider taxes, and higher cash payments for litigation expense. Fitch projects that Tenet's FCF will be about break-even in 2013. This projection is based on the reversal of some of the above- mentioned drags on cash generation and positive cash tax implications of a $1.7 billion net operating loss that the company brought on its books in late 2010. IMPROVEMENT IN OPERATING RESULTS Tenet's patient volume growth trends shifted favorably beginning in 2011 and, for 3Q'12, Tenet reported adjusted admissions growth of 1.4%, its eighth consecutive quarter of positive growth. Positive volume growth has helped the company to improve its profitability. Tenet continues, however, to be less profitable than its peers. The company's EBITDA margin in recent periods has hovered around 12%-13%, which Fitch estimates is nearly 280 bps lower than the average of other publicly traded for-profit hospital operators. Tenet's recently improved level of profitability should be supported by its high level of outpatient healthcare services acquisitions. Starting in 2010, the company began a strategy of vertical integration in markets where it has an existing inpatient hospital presence, buying various outpatient assets such as diagnostic imaging centers, ambulatory surgery centers and oncology centers. This acquisition strategy is somewhat different than the current focus of Tenet's peer companies, which is to augment weak organic growth through the acquisition of inpatient acute-care hospitals. Outpatient acquisitions will not have as immediate an impact on topline growth as inpatient acquisitions because outpatient volumes generate less revenue. Outpatient volumes are, however, typically more profitable. Tenet currently generates only about one-third of its revenue from outpatient service, versus 50%-60% for its peer companies. GUIDELINES FOR FURTHER RATING ACTIONS A positive rating action could result from a combination of the following: -- An expectation of debt maintained below 5.0x EBITDA; -- A nearly 200 bps improvement in the EBITDA margin to around 14%; -- A FCF margin sustained around 3%, which is a level Fitch views as consistent with a 'B+' IDR for an operator of for-profit hospitals. Continued successful execution of the company's acquisition strategy leading to growth in the proportion of revenues derived from more profitable outpatient volumes, as well as growth of Tenet's Conifer Health Solutions business are some potential drivers of financial improvement that could result in an upgrade of the ratings. A negative rating action could result from a combination of these: -- An expectation of debt maintained above 5.5x EBITDA; -- A deterioration in recently improved profitability; -- Persistently negative FCF generation, particularly if this coincides with an amelioration of the FCF headwinds affecting the broader for-profit hospital industry. Deterioration in the financial profile leading to a negative rating action would likely be the result of poor organic performance in Tenet's major markets. The company is heavily exposed to Florida and Texas (about 45% of licensed beds), where Medicare payments to providers have been particularly stressed, although Fitch believes the trend of declining Medicaid payments has bottomed. DEBT ISSUE RATINGS Fitch rates Tenet as follows: -- IDR 'B'; -- Senior secured credit facility and senior secured notes 'BB/RR1'; -- Senior unsecured notes 'B-/RR5'. The Recovery Ratings (RR) reflect Fitch's expectation that the enterprise value of Tenet will be maximized in a restructuring scenario (going concern), rather than a liquidation. Fitch uses a 6.5x distressed enterprise value (EV) multiple and stresses LTM EBITDA by 35%, considering post restructuring estimates for interest and rent expense and maintenance-level capital expenditure. The 6.5x multiple is based on recent acquisition multiples in the healthcare provider space as well as the recent trends in the public equity valuations of the for-profit hospital providers. Fitch estimates Tenet's distressed enterprise valuation in restructuring to be approximately $5 billion. The 'BB+/RR1' rating on the senior secured bank facility and senior secured notes reflects Fitch's expectations for 100% recovery for these creditors. The 'B-/RR5' rating on the unsecured notes rating reflects Fitch's expectations for recovery of 22% of outstanding principal. Total debt of $4.9 billion at Sept. 30, 2012 consisted primarily of: Senior unsecured notes: --$216 million due 2013; --$60 million due 2014; --$474 million due 2015; --$750 million due 2020; --$430 million due 2031. Senior secured notes: --$714 million due 2018; --$1.041 billion due 2018; --$925 million due 2019. THERAPEUTIC SOLUTIONS: James Boyd Discloses 11.7% Equity Stake -------------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, James P. Boyd disclosed that, as of Jan. 17, 2013, he beneficially owns 9,535,000 shares of common stock of Therapeutic Solutions International, Inc., representing 11.7% of the shares outstanding. A copy of the filing is available for free at http://is.gd/68chiC About Therapeutic Solutions Oceanside, Calif.-based Therapeutic Solutions International, Inc., manufactures and sells AMPSA Products to licensed dentists. The AMPSA Products are FDA cleared for the prophylactic treatment of medically diagnosed migraine pain as well as migraine associated tension-type headaches, by reducing their signs and symptoms through reduction of trigeminally innervated muscular activity. AMPSA Products are either fitted chairside by licensed dentists or produced and sold on a semi-custom basis by dental laboratories. AMPSA Products are made of polycarbonate plastic and are designed to fit over either the upper or lower front incisor teeth and protect teeth, muscles and joints by significantly suppressing parafunctional muscle contraction. The Company's balance sheet at June 30, 2012, showed $3.0 million in total assets, $3.3 million in total liabilities, and a stockholders' deficit of $295,691. As reported in the TCR on Nov. 5, 2012, PLS CPA, a Professional Corp., in San Diego, expressed substantial doubt about Therapeutic Solutions' ability to continue as a going concern. The independent auditors noted that under the New License Agreement the Company's rights to sell Anterior Midpoint Stop Appliances to the US market (81% of total revenue) will expire at the end of 2012. THERAPEUTIC SOLUTIONS: Timothy Dixon Discloses 26.7% Equity Stake ----------------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Timothy G. Dixon disclosed that, as of Jan. 17, 2013, he beneficially owns 22,106,400 shares of common stock of Therapeutic Solutions International, Inc., representing 26.7% of the shares outstanding. A copy of the filing is available for free at http://is.gd/O0qzwb About Therapeutic Solutions Oceanside, Calif.-based Therapeutic Solutions International, Inc., manufactures and sells AMPSA Products to licensed dentists. The AMPSA Products are FDA cleared for the prophylactic treatment of medically diagnosed migraine pain as well as migraine associated tension-type headaches, by reducing their signs and symptoms through reduction of trigeminally innervated muscular activity. AMPSA Products are either fitted chairside by licensed dentists or produced and sold on a semi-custom basis by dental laboratories. AMPSA Products are made of polycarbonate plastic and are designed to fit over either the upper or lower front incisor teeth and protect teeth, muscles and joints by significantly suppressing parafunctional muscle contraction. The Company's balance sheet at June 30, 2012, showed $3.0 million in total assets, $3.3 million in total liabilities, and a stockholders' deficit of $295,691. As reported in the TCR on Nov. 5, 2012, PLS CPA, a Professional Corp., in San Diego, expressed substantial doubt about Therapeutic Solutions' ability to continue as a going concern. The independent auditors noted that under the New License Agreement the Company's rights to sell Anterior Midpoint Stop Appliances to the US market (81% of total revenue) will expire at the end of 2012. THERAPEUTIC SOLUTIONS: 223.9MM Shares Released for Cancellation --------------------------------------------------------------- As previously reported, on Aug. 24, 2012, Therapeutic Solutions International, Inc., entered into a Master Dispute Resolution Agreement with James P. Boyd, Boyd Research, Inc., and TMD Courses, Inc., and Timothy G. Dixon and Gerry B. Berg, a License Agreement with Boyd Research, Inc., and TMD Courses, Inc., an Escrow Agreement with Boyd and with Chicago Title Company as escrow agent, and a Voting Agreement with Boyd. Under the MDRA, Boyd agreed to surrender 223,991,933 shares of Company common stock and resigned as a director of the Company. The MDRA also provided that Boyd's employment with the Company would continue throughout 2012, with his salary rate reduced to $100,000 per annum as of the date of the MDRA. Also, the Boyd Parties agreed never to directly or indirectly sell into the public market, in any rolling 90-day period, more than 1% of the Company's then-outstanding common stock; and they agreed to a 10- year standstill prohibiting them from further acquisitions of the Company's stock (except for any stock option exercises through March 31, 2013) and from seeking or assisting to acquire or gain control of the Company. And, the Boyd Parties agreed not to, except in conjunction with other stockholders (unaffiliated with them) holding at least 1,000,000 shares of the Company's common stock, exercise any stockholder rights other than the right to vote. Under the Escrow Agreement, Boyd placed the 223,991,933 shares of Company common stock in escrow, to be released to the Company for cancellation when the Company finished making timely estimated minimum royalties and other payments, all totaling $351,000, into the escrow for the benefit of Boyd; $301,000 of the $351,000 consisted of estimated minimum royalties payments which roughly corresponded to the amount of royalties on anterior midpoint stop appliance intraoral devices net sales which the Company anticipated it would owe the Boyd Parties anyway for the remainder of 2012. The Company completed the payment of the $351,000 on Jan. 17, 2013, and on that date, the escrow agent released those 223,991,933 shares of Company common stock to the Company for cancellation. As a result of the release of those shares to the Company and the cancellation of those shares, Dixon's beneficial ownership percentage of the Company's common stock increased from 5.5% (as of before the MDRA; as part of the MDRA, Boyd transferred 5,000,000 shares of the Company's common stock to Dixon) to 26.7%. Also, all of the Company's other stockholders' beneficial ownership percentage of common stock increased substantially because that cancellation reduced the Company's number of total outstanding common shares from 305,458,333 to 81,466,400. This increase in Dixon's beneficial ownership, viewed together with his Board of Directors seat and his positions as the Company's Chairman, Chief Executive Officer and President, may be considered to constitute a change in control of the Company, in favor of Dixon. Boyd is no longer associated with the Company as an employee, officer or director. As a result of the release of those shares to the Company and the cancellation of those shares, Boyd's beneficial ownership percentage of the Company's common stock decreased from 78% to 11%; and his beneficial ownership percentage would further decrease to 8% if he does not exercise his stock options by their March 31, 2013, termination date (assuming no other changes in his ownership of outstanding shares or in the Company's number of total outstanding common shares). As previously reported, before the License Agreement the Company and certain Boyd Parties were party to an Exclusive License Agreement dated April 1, 2011, as amended on Nov. 1, 2011, and the Company's predecessor Splint Decisions, Inc., and certain Boyd Parties were party to an Exclusive License Agreement dated Oct. 22, 2010, as amended on July 8, 2011, which granted the Company an exclusive worldwide license to certain Boyd Parties patent rights and related technology. The License Agreement terminated the Exclusive Agreements. However, the Licensee Agreement granted the Company new licenses under the applicable patent rights and related technology of the Boyd Parties to manufacture and sell the Company's existing AMPSA intraoral device products. The License Agreement essentially carried forward the Exclusive Agreements' terms as to sales to the US market, except that under the License Agreement the Company's rights to sell AMPSA intraoral device products to the US market expired at the end of 2012. Specifically, for AMPSA intraoral device products sales to the US market, the License Agreement granted us an exclusive license (but no license for the US dental-laboratory field), carrying a 30% royalty on net sales; but such license expired on Dec. 31, 2012. For sales of the existing AMPSA intraoral device products to non- US markets, the License Agreement granted the Company an exclusive license for the remainder of 2012, which converted to a non- exclusive license on Jan. 1, 2013. Under the License Agreement, the Company was required to pay a 30% royalty on 2012 net sales of the existing AMPSA intraoral device products to most non-US markets; but, under the License Agreement, beginning on Jan. 1, 2013, the Company's net sales to non-US markets are royalty-free. Beginning on Jan. 1, 2013, the Boyd Parties are manufacturing and selling to the US market the AMPSA products which the Company had previously sold to the US market (and which, beginning on that date, we are no longer allowed to sell to the US market) and new Boyd Parties AMPSA products as well. Also, from and after Jan. 1, 2013, the Boyd Parties have the right to compete with the Company in the sale to non-US countries of the AMPSA products which the Company had previously sold to the US and non-US markets, and the additional right to sell their new AMPSA products to non-US countries as well. Essentially the Company's entire active business consists of the manufacture and sale of AMPSA intraoral devices; and sales to the US market constituted over 80% of our AMPSA business through Dec. 31, 2012. The Company's challenge will be to counter the loss of its AMPSA sales to the US market and the loss of the ability to introduce new products based on Boyd Party technology, by increasing sales of the Company's existing AMPSA products to non-US markets or by successfully introducing into the US and non- US markets new products which do not require licenses from the Boyd Parties. On the other hand, the Company's business in 2013 and thereafter will be free of Boyd Parties royalty obligations and will not be subject to any Boyd Parties license inception fee. As previously reported, the Company agreed under the MDRA to make deferred payments totaling $140,000 to the Boyd Parties. The Company agreed to pay $10,000 per month for five months beginning Sept. 1, 2012; this series of payments was successfully completed in December 2012. The Company also agreed under the MDRA to make deferred payments of $5,000 per month for 18 months beginning July 1, 2013. These obligations do not bear interest and are unsecured. This reiteration of certain provisions of the MDRA, the License Agreement, the Escrow Agreement and the Exclusive Agreements does not purport to be exhaustive, and is qualified in its entirety by reference to the complete text of these agreements as previously filed by the Company with the Securities and Exchange Commission. About Therapeutic Solutions Oceanside, Calif.-based Therapeutic Solutions International, Inc., manufactures and sells AMPSA Products to licensed dentists. The AMPSA Products are FDA cleared for the prophylactic treatment of medically diagnosed migraine pain as well as migraine associated tension-type headaches, by reducing their signs and symptoms through reduction of trigeminally innervated muscular activity. AMPSA Products are either fitted chairside by licensed dentists or produced and sold on a semi-custom basis by dental laboratories. AMPSA Products are made of polycarbonate plastic and are designed to fit over either the upper or lower front incisor teeth and protect teeth, muscles and joints by significantly suppressing parafunctional muscle contraction. The Company's balance sheet at June 30, 2012, showed $3.0 million in total assets, $3.3 million in total liabilities, and a stockholders' deficit of $295,691. As reported in the TCR on Nov. 5, 2012, PLS CPA, a Professional Corp., in San Diego, expressed substantial doubt about Therapeutic Solutions' ability to continue as a going concern. The independent auditors noted that under the New License Agreement the Company's rights to sell Anterior Midpoint Stop Appliances to the US market (81% of total revenue) will expire at the end of 2012. THQ INC: Video Game Rivals Offer $72-Mil. to Beat Clearlake ----------------------------------------------------------- The Jan. 22 to 23 auction for THQ Inc.'s assets -- which included popular titles Company of Heroes and Saints Row -- attracted competitors in the gaming industry and raised more than $72 million in a piecemeal bidding for the liquidating game developer's assets. Investment firm Clearlake Capital Group, L.P., signed a deal to purchase the company's studios and games for $60 million, absent higher and better offers. Clearlake's offer was in the form of $6.65 million in cash, a seven-year note of $10 million plus the assumption of $15 million in prepetition debt plus $29 million in DIP financing. THQ on Wednesday filed with the Bankruptcy Court a notice of the auction results. The two-week delay appears to have worked as the price rose by more than $10 million with several parties splitting THQ's portfolio of assets: Asset Buyer ----- ----------- Company of Heroes Winning Bidder: Sega Corp., $26.6 million; Backup Bidder: Zenimax Media Inc., $26.3MM 1666 and Underdog Winning Bidder: Ubisoft, $2.5 million; Backup Bidder: None Metamorphosis aka Evolve Winning Bidder: Take-Two, $10.9 million; Backup Bidder: Turtle Rock Studios, $250,000 Saints Row Winning Bidder: Koch Media GmbH, $22.3-mil.; Backup Bidder: Ubisoft LLC, $5.4 million Homefront and Homefront 2 Winning Bidder: Crytek GmbH, $554,000 Backup Bidder: None Metro 2033 and Metro 2034 Winning Bidder: Koch Media, $5.88 million, Backup Bidder: Ubisoft LLC, $5.17 million South Park: The Stick of Truth Winning Bidder: Ubisoft, $3.66 million On Jan. 11, the bankruptcy judge entered a final order authorizing THQ Inc. to obtain postpetition financing of $37.5 million from Wells Fargo Capital Finance, LLC, and proposed buyer Clearlake Capital Group, L.P. The DIP financing -- which continues an existing revolving credit facility and adds a term loan of $10 million -- was slated to mature Jan. 15 (unless extended), and thus the Debtor sought for a quick sale. The Debtor had proposed a quick sale, specifically a Jan. 9 auction on grounds that the $10 million of new money provided by Clearlake would run out by Jan. 15. Nonetheless Bankruptcy Judge Mary Walrath delayed the Clearlake-led auction until Jan. 22. Early this month, THQ obtained final approval from the bankruptcy judge to sell accounts receivable to Wells Fargo. Walmart Stores typically provides an invoice -- about $1 million a week -- for accounts payable arising from the sale of THQ products at Walmart. Given that the collection of cash on these receivables is usually delayed by 60 days, the Debtor signed a deal to sell the receivable to its existing lender to ensure that the Debtor would have the necessary cash flow to continue operating the business. The Debtor said its normal business cycle includes periods of negative cash flow, while they are developing and marketing a game prior to its actual release, followed by periods of positive cash flow after the release of a new game. The Debtors are not scheduled to release any new games until March 2013. About THQ THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide developer and publisher of interactive entertainment software. The Company develops its products for all popular game systems, personal computers, wireless devices and the Internet. Headquartered in Los Angeles County, California, THQ sells product through its network of offices located throughout North America and Europe. THQ Inc. and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13398) on Dec. 19, 2012. THQ has a deal to sell its video-game development business to Clearlake Capital Group LP for about $60 million, absent higher and better offers at an auction proposed for January 2013. Clearlake and existing lender Wells Fargo Capital Finance LLC are providing $10 million of DIP financing. Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn & Crutcher LLP serve as counsel to the Debtors. FTI Consulting and Centerview Partners LLC are the financial advisors. Kurtzman Carson Consultants is the claims and notice agent. THQ INC: Assets Split; Sale to Multiple Buyers Approved ------------------------------------------------------- THQ Inc. on Jan. 24 disclosed that the U.S. Bankruptcy Court has granted a motion to approve a sale of the majority of THQ's assets to multiple buyers. The company expects the Court to enter a formal order today, Jan. 25. The Court approved the sales of three of THQ's owned studios and games in development, as well as Evolve, a working title under development at Turtle Rock Studios, Homefront 2, Metro: Last Light and South Park: The Stick of Truth. Under the terms of the agreements with the successful and approved bidders, the THQ estate will receive approximately $72 million, making the total estimated value of the estate $100 million including certain assets and other intellectual properties which were excluded from the sale. The Court approved the sale of Relic Studios to Sega Corporation for $26.6 million; the sale of Volition Inc. and Metro: Last Light to Koch Media GmbH for $22.3 million and $5.9 million, respectively; the sale of Homefront 2 to Crytek GmbH for $0.5 million; the sale of Evolve to Take-Two Interactive Software, Inc. for $10.9 million; and the sale of THQ Montreal and South Park: The Stick of Truth to Ubisoft LLC for $2.5 million and $3.3 million, respectively. Excluded from the sales were the company's publishing businesses, Vigil Games, and certain other assets and intellectual properties, which will remain part of the THQ estate and will continue in the Chapter 11 process. Brian Farrell, Chairman and CEO of THQ, noted, "While we had hoped that the restructuring process would allow the company to remain intact, I am heartened that the majority of our studios and games will continue under new ownership. It has been my pleasure to work alongside this great group of people, and I am proud of the imaginative and artistic games that our team has created. Although we will no longer be able to work together with a unified mission, I am confident that the talent we have assembled will continue to make an impression on the video game industry. For those whose positions are not likely to continue, I sincerely regret this outcome and we will be meeting with you over the next few days to discuss the transition." Jason Rubin, President of THQ, added, "I was brought in eight months ago to help turn this ship around, and while I'm disappointed that we could not effect a sale for the entire operating business, I am pleased that the new buyers will be providing jobs to many of our very talented personnel. When we first announced the sale process, I said I would be happy if the company's games and people had a bright future, even if it meant I did not have a job at the end of it. And I still feel that way." The new owners have not articulated their plans for the assets, or their intentions to extend employment to THQ employees included in the sale. THQ expects the new owners to extend employment to most employees and to continue development of the games they purchased that are currently in development. The assets that are not included in the sale agreements will remain part of the Chapter 11 case. THQ will continue to seek appropriate buyers, if possible. THQ will continue to employ a small number of headquarters staff beyond January 25 to assist with the transition. Qualified bids received by Jan. 22 were reviewed by the company and the creditors committee. Through an auction process that lasted 22 hours on Jan. 23 and Jan. 24, the successful bidders were determined, and the hearing to approve the sales took place this afternoon. Ten bidders participated in the proceedings, including bids for the entire company as well as for individual assets. The sales are expected to close today, Jan. 25. Clearlake Capital Group, L.P. had submitted a "stalking horse" bid for substantially all of THQ's assets in December 2012. In accordance with Section 363 of the U.S. Bankruptcy Code, the Court supervised an auction to determine the highest and best bid(s) for the company's assets in accordance with the bid procedures approved by the Court. Clearlake will receive a break-up fee of $1 million, as stated in its stalking horse asset purchase agreement. THQ and its domestic business units filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Court for the District of Delaware on Dec. 19, 2012. The Chapter 11 case will continue for THQ. About THQ Inc. THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide developer and publisher of interactive entertainment software. The Company develops its products for all popular game systems, personal computers, wireless devices and the Internet. Headquartered in Los Angeles County, California, THQ sells product through its network of offices located throughout North America and Europe. THQ Inc. and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13398) on Dec. 19, 2012. THQ has a deal to sell its video-game development business to Clearlake Capital Group LP for about $60 million, absent higher and better offers at an auction proposed for January 2013. Clearlake and existing lender Wells Fargo Capital Finance LLC are providing $10 million of DIP financing. Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn & Crutcher LLP serve as counsel to the Debtors. FTI Consulting and Centerview Partners LLC are the financial advisors. Kurtzman Carson Consultants is the claims and notice agent. THQ INC: Crytek Acquires Rights to Homefront IP Studio ------------------------------------------------------ Crytek GmbH on Jan. 24 announced the acquisition of the intellectual property rights for the Homefront franchise following an auction of assets by THQ Inc. Crytek's association with the Homefront IP began in autumn 2011, when the developer announced it would be creating the second game in the series in partnership with THQ Inc. Following THQ's recent decision to file for chapter 11 bankruptcy and the subsequent sale of the publisher's assets, Crytek submitted the high bid at auction to secure the rights to the Homefront franchise. Crytek CEO, Cevat Yerli, said: "Since we first reached an agreement to develop Homefront 2, we've been firm believers in the IP and its potential to excite and amaze players. Our cooperation with THQ was always positive and we would like to thank them for all their support over the last two years and express our sympathy to those affected by the recent events at the company." Development work will continue on Homefront 2 at Crytek's UK studio in Nottingham. "From day one, the Homefront 2 team has been committed to creating a game that takes the series to new heights and features the level of quality and innovation associated with Crytek," said Nick Button-Brown, General Manager of Games at Crytek. "Nothing has changed with regards our development of the game, and we look forward to sharing the finished product with players." About Crytek GmbH Crytek GmbH -- http://www.crytek.com-- is an independent company at the forefront of the interactive entertainment industry, and is dedicated to pushing the boundaries of gaming by creating standout experiences for Xbox 360, Playstation 3, PC, mobile devices and games-as-service using their cutting-edge 3D-Game-Technology, CryENGINE(R). The company's headquarters are in Frankfurt am Main (Germany). Crytek also has studios in Kiev (Ukraine), Budapest (Hungary), Sofia (Bulgaria), Seoul (South Korea), Nottingham (UK), Shanghai (China) and Istanbul (Turkey). About THQ Inc. THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide developer and publisher of interactive entertainment software. The Company develops its products for all popular game systems, personal computers, wireless devices and the Internet. Headquartered in Los Angeles County, California, THQ sells product through its network of offices located throughout North America and Europe. THQ Inc. and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13398) on Dec. 19, 2012. THQ has a deal to sell its video-game development business to Clearlake Capital Group LP for about $60 million, absent higher and better offers at an auction proposed for January 2013. Clearlake and existing lender Wells Fargo Capital Finance LLC are providing $10 million of DIP financing. Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn & Crutcher LLP serve as counsel to the Debtors. FTI Consulting and Centerview Partners LLC are the financial advisors. Kurtzman Carson Consultants is the claims and notice agent. TORCH ENERGY: Receives NYSE Delisting Notice on Delayed Filing -------------------------------------------------------------- Torch Energy Royalty Trust on Jan. 24 disclosed that it received notice from NYSE Regulation, Inc. that NYSE Regulation has determined to delist the Trust's units from the New York Stock Exchange, with trading of the units to be suspended prior to the opening of NYSE trading on Wednesday, January 30, 2013. The Trust expects to commence trading on the Pink Sheets on that same day, under a symbol yet to be determined. NYSE Regulation indicated that it reached this determination based on the Trust's delay in filing its Annual Report for the year ended December 31, 2011 on Form 10-K and Quarterly Reports for the fiscal quarters ending in 2012 with the Securities and Exchange Commission. While the Trust had received a six-month and subsequent three-month extension of the filing date for the Annual Report to January 16, 2013 from NYSE Regulation, the Trust was unable to file the Annual Report by this extended deadline. NYSE Regulation declined the Trust's request for further extension under the NYSE Listed Company Manual of the filing deadline. NYSE Regulation also noted that the average closing price of the Trust's units had previously fallen below the NYSE's continued listing minimum share price standard of $1.00 over a consecutive 30 trading day period and the Trust had been working to regain compliance with such standard within the six-month cure period provided in Section 802.01C of the NYSE's Listed Company Manual. The Trust had previously reported on such NYSE notices and extensions. The Trust has not been able to complete the filing of its Annual Report and Quarterly Reports due to a delay in obtaining and compiling financial information required to be included in such reports. The Trust has a right to appeal the NYSE Regulation delisting determination. The NYSE Regulation notice states that the timing of its application to the SEC to delist the Trust's units will depend on the completion of its procedures and any appeal by the Trust of the delisting determination. The Trust was terminated by a vote of the unitholders in January 2008. The Trust is currently in the wind up and liquidation period. Under the Trust Agreement, upon termination of the Trust, the remaining assets of the Trust are to be sold and the proceeds distributed to the unitholders. The assets of the Trust are Net Profits Interests that burden oil and gas properties located at Chalkley Field in Louisiana and fields that produce from the Cotton Valley and Austin Chalk formations in Texas. I n December 2011, following a public auction for such interests, the Trust sold its net profits interests associated with the oil and gas properties at the Robinson's Bend Field in the Black Warrior Basin to Robinson's Bend Production II, LLC. All of the remaining Net Profits Interests of the Trust are being currently marketed for sale. About Torch Energy Royalty Trust Headquartered in Wilmington, Detroit, Torch Energy Royalty Trust (NYSE:TRU) -- http://www.torchroyalty.com/-- was formed pursuant to a trust agreement among Wilmington Trust Company, as trustee, Torch Royalty Company, Velasco Gas Company Ltd. and Torch Energy Advisors Incorporated as grantor. TRC and Velasco contracted to sell the oil and gas production from certain oil and gas properties to Torch Energy Marketing Inc., a subsidiary of Torch, under a purchase contract. TRC and Velasco receive payments reflecting the proceeds of oil and gas sold and aggregate these payments, deduct applicable costs and make payments to the Trustee each quarter for the amounts due to the Trust. The Underlying Properties constitute working interests in the Chalkley Field in Louisiana, the Robinson's Bend Field in the Black Warrior Basin in Alabama, Cotton Valley formations in Texas and Austin Chalk formation in Texas. TRANS-LUX CORP: Gabelli Funds Lowers Equity Stake to 46.7% ---------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Gabelli Equity Series Funds, Inc. - The Gabelli Small Cap Growth Fund disclosed that, as of Dec. 31, 2012, it beneficially owns 14,107,500 shares of common stock of Trans-Lux Corporation representing 46.70% of the shares outstanding. The Fund previously reported beneficial ownership of 14,055,000 common shares or a 75.2% equity stake as of Dec. 31, 2011. A copy of the filing is available at http://is.gd/cbkCaD About Trans-Lux Corporation Norwalk, Conn.-based Trans-Lux Corporation (NYSE Amex: TLX) is a designer and manufacturer of digital signage display solutions for the financial, sports and entertainment, gaming and leasing markets. The Company reported a net loss of $1.42 million in 2011, compared with a net loss of $7.03 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $23.62 million in total assets, $20.37 million in total liabilities, and $3.25 million in total stockholders' equity. TRUCEPT INC: Adds N. Tipton to Board of Directors ------------------------------------------------- Trucept, Inc., formerly known as Smart-tek Solutions Inc., has added Norman Tipton to its Board of Directors. CEO and Board Chairman Brian Bonar said Mr. Tipton has an extensive background in staffing, human resources and law. "Mr. Tipton has invaluable insights into the PEO and staffing businesses, having worked in the industry for nearly a decade," Mr. Bonar said. Mr. Tipton, a member of the California Bar, is a graduate of Thomas Jefferson School of Law and holds a master's in Sociology with emphasis in industrial organization from San Diego State University. He has previously held a management position at SAIC, a Fortune 500 company. Trucept Inc. also operates the Solvis brand of nurse staffing in both Michigan and California. About Trucept Inc. Trucept Inc. provides staffing and employment services, relieving its clients from many of the day-to-day tasks that may detract their core business operations , such as payroll processing, human resources support, workers' compensation insurance, safety programs, employee benefits, and other administrative and aftermarket services predominantly related to staffing. The company also operates the Solvis brand of nurse staffing in both Michigan and California. The Company reported a comprehensive loss of $8.12 million on $21.74 million of revenue for the year ended Dec. 31, 2011, compared with a comprehensive income of $855,188 on $17.22 million of revenue during the prior year. After auditing the financial statements for 2011, PMB Helin Donovan, LLP, in Dallas, Texas, expressed ubstantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has sustained recurring losses from operations and has an accumulated deficit of approximately $13 million at Dec. 31, 2011. The Company's balance sheet at Sept. 30, 2012, showed $8.20 million in total assets, $20.60 million in total liabilities and a $12.39 million total stockholders' deficit. VELO HOLDINGS: Scores Approval for Chapter 11 Plan -------------------------------------------------- Maria Chutchian of BankruptcyLaw360 reported that private equity- held direct marketer Vertrue LLC and its holding company Velo Holdings LLC got the go-ahead Wednesday to make their way out of bankruptcy less than a year after filing for Chapter 11 protection, with a New York bankruptcy judge approving their reorganization plan. Though the plan will provide less than 1 percent recovery for unsecured creditors, it was supported overwhelmingly by holders of first-lien and general unsecured claims, according to Vertrue, the report related. The plan also secured the approval of the chief restructuring officer and other key executives, the report added. About Velo Holdings V2V Corp. is a premier direct marketing services company, providing individuals and businesses with access to a wide-variety of consumer benefits in the United States, Canada, and the United Kingdom. V2V was founded in 1989 as a membership services company that marketed its membership programs exclusively via telemarketing and, after having nearly a decade of continued growth, went public in 1996. In 2007, V2V was acquired by a consortium of private equity firms led primarily by investing affiliates of One Equity Partners. Norwalk, Connecticut-based Velo Holdings Inc. and various affiliates, including V2V, filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case Nos. 12-11384 to 12-11386 and 12-11388 to 12-11398) on April 2, 2012. The debtor-affiliates are V2V Holdings LLC, Coverdell & Company, Inc., V2V Corp., LN Inc., FYI Direct Inc., Vertrue LLC, Idaptive Marketing LLC, My Choice Medical Holdings Inc., Adaptive Marketing LLC, Interactive Media Group (USA) Ltd., Brand Magnet Inc., Neverblue Communications Inc., and Interactive Media Consolidated Inc. Judge Martin Glenn presides over the case. Lawyers at Dechert LLP serve as the Debtors' counsel. The Debtors' financial advisors are Alvarez & Marsal Securities LLC. The Debtors' investment banker is Alvarez & Marsal North America, LLC. Quinn Emanuel Urquhart & Sullivan, LLP, serves as the Debtors' special counsel. Epiq Bankruptcy Solutions serves as the Debtors' claims agent. Velo Holdings estimated $100 million to $500 million in assets and $500 million to $1 billion in debts. The petitions were signed by George Thomas, general counsel. Lawyers at Willkie Farr & Gallagher LLP represent Barclays, the First Lien Prepetition Agent and the DIP Agent. The First Lien Prepetition Agent and DIP Agent also has hired FTI Consulting, Inc. Sidley Austin LLP represents the Second Lien Prepetition Agent. Tracy Hope Davis, U.S. Trustee for Region 2, appointed three unsecured creditors to serve on the Official Committee of Unsecured Creditors of Velo Holdings Inc., et al. VENTANA 20/20: Nearhood Tapped to Dispute Ariz. Tax Assessment -------------------------------------------------------------- Ventana 20/20 LP sought and obtained approval from the U.S. Bankruptcy Court to employ Nearhood Law Offices, PLC, as special counsel. Nearhood will assist the Debtor in contesting with the Arizona Tax Court the assessment of property taxes on 113 condominium units on the Debtor's real property commonly known as Greens at Ventana Canyon Condominiums for 2013 tax year. Nearhood's fee is contingent on the outcome of the Lawsuit. Nearhood will be paid a contingency fee equal to 30% of the following: (i) any reduction in property taxes for the 2013 tax year resulting from the Lawsuit; (ii) interest paid on any refund of property taxes resulting from the Lawsuit; and (iii) any attorneys' fees awarded to Ventana 20/20. In addition, any out of pocket expenses incurred on behalf of the Lawsuit, including filing fees, expert witness fees, and court costs, will be reimbursed to Nearhood by Ventana 20/20 regardless of the outcome of the Lawsuit. To the best of Debtor's knowledge, Nearhood has no connection with any of the creditors, or any other party in interest in this case, or any of their respective attorneys and is a disinterested person as that term is defined in 11 U.S.C. Sec. 101(13). About Ventana 20/20 LP Ventana 20/20 LP filed bare-bones Chapter 11 petition (Bankr. D. Ariz. Case No. 12-17493) in Tucson on Aug. 3, 2012. The Debtor disclosed $14,542,797 in assets and $10,938,012 in liabilities. John Murphy, as manager of the Debtor, signed the Chapter 11 petition. Mr. Murphy is the founder, chairman and CEO of the 20/20 Group of companies. As a value investor, he has led or participated in over $1 billion of multi-family acquisitions across North America. Bankruptcy Judge Eileen W. Hollowell oversees the case. Frederick J. Petersen, Esq., at Mesch, Clark & Rothschild, P.C., serves as the Debtor's counsel. Donald L. Schaefer, court appointed receiver for the Debtors, is represented by Warren J. Stapleton, Esq., at Osborn Maledon, P.A. In September, the United States Trustee said that an official committee under 11 U.S.C. Sec. 1102 has not been appointed in the bankruptcy case of Ventana 20/20 LP. The U.S. Trustee said it attempted to solicit creditors interested in serving on the Unsecured Creditors' Committee from the 20 largest unsecured creditors. After excluding governmental units, secured creditors and insiders, the U.S. Trustee has been unable to solicit sufficient interest in serving on the Committee, to appoint a proper Committee. The U.S. Trustee reserves the right to appoint such a committee should interest developed among the creditors. VITESSE SEMICONDUCTOR: Columbia Pacific Holds 8.3% Equity Stake --------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Columbia Pacific Opportunity Fund, L.P., and its affiliates disclosed that, as of Dec. 31, 2012, they beneficially own 3,014,448 shares of common stock of Vitesse Semiconductor Corp. representing 8.27% of the shares outstanding. Columbia Pacific previously reported beneficial ownership of 2,744,128 common shares or 11.23% equity stake as of May 31, 2011. A copy of the amended filing is available for free at: http://is.gd/V4O5rL About Vitesse Based in Camarillo, California, Vitesse Semiconductor Corporation (Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs, develops and markets a diverse portfolio of semiconductor solutions for Carrier and Enterprise networks worldwide. In October 2009, Vitesse completed a debt restructuring transaction that resulted in the conversion of 96.7% of the Company's 2024 Debentures into a combination of cash, common stock, Series B Preferred Stock and 2014 Debentures. With respect to the remaining 3.3% of the 2024 Debentures, Vitesse settled its obligations in cash. Additionally, Vitesse repaid $5.0 million of its $30.0 million Senior Term Loan, the terms of which were amended as part of the debt restructuring transactions. Vitesse incurred a net loss of $1.11 million in 2012, a net loss of $14.81 million in 2011, and a net loss of $20.05 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $56.61 million in total assets, $80.63 million in total liabilities, and a $24.01 million total stockholders' deficit. W.R. GRACE: Adjusts Asbestos-Related Liability to $2.06 Billion --------------------------------------------------------------- W. R. Grace & Co. on Jan. 24 disclosed that it will adjust its recorded asbestos-related liability to $2,065 million from the previous amount of $1,700 million. Grace will report a $365 million non-cash, pre-tax charge in its fourth quarter 2012 earnings. This non-cash charge will have no impact on Adjusted EBIT or Adjusted EPS. As discussed in the company's November 9, 2012 teleconference with analysts, an adjustment to the recorded amount is now necessary to reflect the increased estimates of the settlement values of the warrant and deferred payment obligation payable to the asbestos personal injury trust under Grace's plan of reorganization. The company currently estimates the warrant's value to be $490 million, the maximum value under the company's cash settlement agreement with the asbestos trust. The cash settlement agreement was approved by the bankruptcy court on December 17, 2012. The company currently estimates the deferred payment obligation's value to be $547 million. The increase in the estimated value of the deferred payment obligation reflects the company's improved borrowing costs and the expected timing of its bankruptcy emergence. The non-cash charge of $365 million is lower than the range of $375 million to $475 million that the company had estimated in its November 9 teleconference. The ultimate cost of settling the asbestos-related liability will be based on the value of the consideration transferred to the asbestos trusts at emergence and may vary from the current estimate. The company will release fourth quarter 2012 earnings before market open on February 6 and will conduct a conference call with analysts and investors at 11:00 a.m. EST the same day. Conference call dial-in instructions can be found at the Investor Information page on the company's web site at http://www.grace.com About Grace Grace -- http://www.grace.com-- is a global supplier of catalysts; engineered and packaging materials; and, specialty construction chemicals and building materials. The company's three industry-leading business segments -- Grace Catalysts Technologies, Grace Materials Technologies and Grace Construction Products -- provide innovative products, technologies and services that enhance the quality of life. Grace employs approximately 6,000 people in over 40 countries and had 2011 net sales of $3.2 billion. WEEKLEY FINANCE: Moody's Assigns 'B1' CFR; Outlook Stable --------------------------------------------------------- Moody's Investors Service assigned a B1 corporate family rating, a B1-PD probability of default rating, and a B2 rating to the proposed $200 million senior unsecured notes due 2023 of Weekley Homes, LLC and its co-issuer, Weekley Finance Corp. ("Weekley Homes"). The rating outlook is stable. This is the first time Moody's has assigned public ratings to this issuer. The following rating actions were taken: Corporate family rating, assigned B1; Probability of default rating, assigned B1-PD; $200 million senior unsecured notes due 2023, assigned B2, LGD5-73%; Stable outlook. Ratings Rationale The net proceeds from the $200 million senior unsecured notes, estimated to be $195 million, will be used to repay all outstanding borrowings ($151 million) under the company's various senior secured borrowing base credit facilities, with the remainder to be used for general corporate purposes. This repayment will increase the borrowing base credit facilities' availability to $291 million. The B1 corporate family rating reflects Weekley Homes' relatively small size and scale compared to many of its peers; relatively limited geographic diversity, with an approximately 60% concentration of its lot inventory in Texas; negative cash flow generation; projected growing debt leverage; and thin cash balances. At the same time, the rating considers Weekley Homes' track record of stable profitability through the cycle, including positive net income generation and decent gross margins during most of the downturn (a rare characteristic for a homebuilder). In addition, the B1 rating is supported by the company's solid interest coverage, modest homebuilding debt leverage of pro forma 46.5%, good positions in its markets, diversity of product offerings (which include first-time, move-up, second move-up, and custom homes), and relatively conservative land strategies reflected in a small land supply of about two years. The company has sufficient liquidity, supported by the pro forma available borrowing base capacity of $291 million under its eight credit facilities that have total commitment capacity of $470 million, and lack of significant debt maturities until 2015, when $400 million face amount of the credit facilities mature. The liquidity is, however, constrained by negative cash flow generation, limited cash balances, and the need to comply with numerous financial covenants in the facility agreements, including minimum tangible net worth, a liabilities to net worth ratio, and other financial covenants. In Moody's view, Weekley Homes is likely to maintain compliance with these covenants in the next 12 to 18 months. The stable outlook reflects Moody's expectation that favorable homebuilding industry conditions will result in a growing top line as well as increasing profitability and earnings for the company. The outlook is also predicated on Moody's view that Weekley Homes will maintain its conservative land strategies and reduce its debt leverage after the expected spurt in the next two years due to increasing land spend. The ratings could be upgraded if the company builds its size and scale, continues to expand its profitability and improves gross margins above 20%, while the adjusted homebuilding debt to capitalization ratio declines below 45% and liquidity remains solid. The ratings could be considered for a downgrade if the company generates operating losses, adjusted debt leverage rises above 60% on a sustained basis, or if land strategies become more aggressive. Weekley Homes, LLC, ("Weekley Homes"), headquartered in Houston, Texas, is a private homebuilder constructing entry level, first move-up, second move-up and custom homes. The company was founded in 1976 by David Weekley, and is currently 100%-owned by the Weekley family and senior management. The company has a presence in 16 metro markets in eight states. In the trailing 12-month period ending September 30, 2012, Weekley Homes generated $748 million in total revenues and $44 million in net income. The principal methodology used in this rating was the Global Homebuilding Industry Methodology published in March 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. WENATCHEE, WA: Moody's Hikes Tax Gen. Obligation Rating to 'Ba1' ---------------------------------------------------------------- Moody's Investors Service has upgraded the City of Wenatchee, Washington's unlimited tax general obligation rating to Ba1 from Ba2 and its limited tax rating to B1 from B2. At this time, Moody's also has downgraded the city's senior lien combined water and sewer enterprise revenue rating to Baa1 from A1. $2.6 million of unlimited tax, $5.8 million of limited tax debt, and $4.3 million of senior lien water and sewer debt is affected. Stable outlooks have been assigned. SUMMARY RATING RATIONALE The upgrades and outlook reflect diminished but ongoing financial risks following the cure of a recent default brought about by the city's unwillingness to honor a general obligation, limited tax contingent obligation to make loans for interest-only payments on $36.6 million sales tax and revenue Bond Anticipation Notes (not rated) issued by the Greater Wenatchee Regional Events Center Public Facilities District (PFD). On May 10, 2012, the City of Wenatchee indicated that despite budgeting $2.1 million in fiscal 2012 for PFD-related issues, there were insufficient general fund moneys to advance the $967,000 for a June 1 interest payment, an event of default on non-rated city debt on parity with rated GOLT obligations. The PFD has issued takeout sales tax bonds which eliminate much of the city's contingent liabilities for PFD operations and debt service, shrinking the city's maximum annual pledged subsidy to $200,000 per year and favorably settling with most of the city's major potential legal counterparties. The Ba1 general obligation rating reflects both the recent default and the diminished risks associated with a cure which paid note holders in full but not in a timely manner, as well as recently challenged city financial operations. The rating also incorporates the city's modestly-sized tax base and modest debt levels featuring some dedicated debt levies. The B1 general obligation, limited tax rating distinction further incorporates the recent, though cured, cross default on non-rated parity obligations, some ongoing risks from potential litigation, as well as limited near-term operational flexibility as the city drew down reserves to low levels for PFD-related subsidies and legal costs. The Baa1 senior lien water and sewer revenue rating distinction reflects the enterprise's common management with general city operations mitigated somewhat by independent rate setting authority resulting in adequate debt service coverage levels. A stable outlook incorporates the expectation that despite a successful PFD takeout of the defaulted BANs, Wenatchee still faces challenged financial operations and ongoing though attenuated litigation risk. STRENGTHS - Successful new dedicated sales taxes allowed PFD BAN takeout financing, reducing financial and legal risks to the city from prior interest and operating subsidy commitments to the PFD - Moderately-sized and stabilizing tax base despite recent declines CHALLENGES - Unwillingness to make adjustments outside the general fund to incorporate loans for interest payments on Greater Wenatchee Events Center BANs - City remains contingently liable for a maximum of $200,000 in annual PFD subsidies - Continued, though attenuated, financial risk associated with post-default litigation WHAT COULD MAKE THE RATING MOVE UP - Demonstrated commitment to the prioritization of the city's general obligation, limited tax pledge - Significant reduction in overall debt burden and general fund debt service load - Prolonged growth in property valuations and sales tax receipts - Increased self-sufficiency of PFD and city enterprise operations - Sustained period without adverse litigation demands WHAT COULD MOVE THE RATING DOWN - Weakened liquidity - Weakened reserve levels - Deterioration of/increased subsidy of PFD or city enterprise operations - Inability to align ongoing expenditures with ongoing revenues - Adverse litigation outcomes Outlook A stable outlook incorporates the expectation that despite a successful PFD takeout of the defaulted BANs, Wenatchee still faces challenged financial operations and ongoing though attenuated litigation risk. Rating Methodology The principal methodology used for the General Obligation ratings was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. The principal methodology used for the Revenue rating was Analytical Framework For Water And Sewer System Ratings published in August 1999. WISP RESORT: Sells Kendall Camp Circle Property for $485,000 ------------------------------------------------------------ Bankruptcy Judge Wendelin I. Lipp gave his stamp of approval on a stipulation and consent order modifying a previous ruling that allowed D.C. Development, LLC, to sell a property in McHenry, Maryland, and disburse sales commission. MVB Bank and Logan/Frazee/Yudelevit are counterparties to the stipulation. DC Development sold the 181 Kendall Camp Circle property free and clear of liens, claims, encumbrances and interest, for $485,000. Pursuant to the sale order, any liens on the Property will attach to the sale proceeds, and the Debtor is authorized to use the proceeds to make payment on any and all liens in order of their relative priority. The Debtor or any other party holding the commission for the sale is directed to release the commission from escrow and pay Wisp Resort Development, Inc. the 4% commission. The Court authorizes the division of the commission in this manner: Seller's Agent -- Michael Wallace 2.8% $13,580.00 Broker Fee -- Karen F. Myers 1.0% 5,000.00 Funds to WRD for Operations 0.2% 820.00 TOTAL $19,400.00 A copy of the Jan. 22, 2013 Stipulation and Consent Order is available at http://is.gd/JblfyUfrom Leagle.com. About Wisp Resort et al. Recreational Industries, Inc., D.C. Development, LLC, Wisp Resort Development, Inc., and The Clubs at Wisp, LLC, operated a ski resort and real estate development companies located in Garrett County, Maryland generally known as Wisp Resort. The Wisp Resort comprises approximately 2,200 acres of master planned and fully entitled land, 32 ski trails covering 132 acres of skiable terrain with 12 lifts and two highly-rated golf courses. Financial problems were caused by a guarantee given to Branch Banking & Trust Co. to secure a $29.6 million judgment the bank obtained on a real estate development within the property. Recreational Industries, D.C. Development, Wisp Resort Development and The Clubs at Wisp filed for Chapter 11 bankruptcy (Bankr. D. Md. Lead Case No. 11-30548) on Oct. 15, 2011, after defaulting on nearly $30 million in loans from BB&T Corp. to build the golf course community. D.C. Development disclosed $91,155,814 in assets and $46,141,245 in liabilities as of the Chapter 111 filing. The Debtors engaged Logan, Yumkas, Vidmar & Sweeney LLC as counsel and tapped Invotex Group as financial restructuring consultant. SSG Capital Advisors, LLC, serves as exclusive investment banker to the Debtors. The Official Committee of Unsecured Creditors has tapped Cole, Schotz, Meisel, Forman & Leonard, P.A. as counsel. WJO INC: Has Access to Cash Collateral Until Jan. 31 ---------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Pennsylvania approved a 21st stipulation and agreed interim order authorizing Alfred T. Giuliano's interim use of cash collateral until Jan. 31, 2013, plus any additional timeframes that may be agreed to by consent. The 21st stipulation, entered between Mr. Giuliano, Chapter 11 trustee for WJO, Inc., and TriState Capital Bank, extended the order dated Nov. 16, 2010, which authorized the interim use of cash collateral. The trustee would use the cash collateral solely to pay the expenses for the interim period with a permitted 10% variance of the total expenses. The lender asserts that it holds valid, enforceable, and allowable claims against Debtor on the Petition Date, pursuant to the Loan Documents and applicable law: (i) under the Revolving Credit Facility, of unpaid principal in the amount of $3.1 million (ii) under the Term Loan, of unpaid principal in the amount of $820,000; together with any other obligations of the Debtor to the lender to the extent provided under the Loan Documents, including without limitation interest, reasonable costs, attorneys' fees, and any and all other amounts owing under the Loan Documents prepetition and to the extent permitted by the Bankruptcy Code and applicable law. As adequate protection from any diminution in value of the lender's collateral, the trustee grants the lender replacement liens on all properties and assets of the Debtor, and superpriority administrative expense claim status. A further hearing for the use of cash collateral was set for Jan. 23. About WJO Inc. Bristol, Pennsylvania-based WJO, Inc., operates six family practices located in Newtown, Bristol, Bensalem, Bustleton, South Philadelphia, and Bethlehem, Pennsylvania and consists of Board Certified Osteopathic Physicians specializing in Family Medicine. Prior to the petition date, and to allow the Company to restructure effectively, HyperOx Inc., HyperOx I, LP, HyperOx III, LP, and East Coast TMR, Inc., were merged into WJO. WJO filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No. 10-19894) on Nov. 15, 2010. The Debtor disclosed $19,923,802 in assets and $6,805,255 in liabilities as of the Chapter 11 filing. Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy counsel. Pond Lehocky Stern Giordano serves as the Debtor's special counsel to represent it in worker's compensation proceedings pertaining to the Therapeutic Magnetic Resonance treatments. Patrick Yun serves as the Debtor's financial advisor. Attorneys at Keifer & Tsarouhis LLP serve as counsel to the official committee of unsecured creditors. ParenteBeard LLC serves as the Committee's accountant and financial advisor. The United States Trustee has appointed David Knowlton as patient care ombudsman in the case. The Ombudsman is represented in the case by Karen Lee Turner, Esq., at Eckert Seamans Cherin & Mellott, LLC, as counsel. Tristate Capital Bank, the cash collateral lender, is represented in the case by lawyers at Benesch Friedlander Coplan & Aronoff LLP. On July 3, 2012, Roberta A. DeAngelis, U.S. Trustee for Region 3, obtained permission from the Hon. Jean K. Fitzsimon of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to appoint Alfred T. Giuliano as Chapter 11 trustee of the bankruptcy estate of WJO, Inc. Maschmeyer Karalis P.C. serves as the Chapter 11 Trustee's general bankruptcy counsel. XZERES CORP: Incurs $1.5 Million Net Loss in Nov. 30 Quarter ------------------------------------------------------------ XZERES Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $1.51 million on $1.91 million of gross revenues for the three months ended Nov. 30, 2012, compared with a net loss of $2.13 million on $927,451 of gross revenues for the same period during the prior year. For the nine months ended Nov. 30, 2012, the Company reported a net loss of $4.91 million on $3.74 million of gross revenues, compared with a net loss of $5.89 million on $3.31 million of gross revenues for the same period a year ago. The Company's balance sheet at Nov. 30, 2012, showed $4.11 million in total assets, $5.13 million in total liabilities and a $1.02 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/dITKR0 About XZERES Corp. Headquartered in Wilsonville, Oregon, XZERES Corp. designs, develops, and markets distributed generation, wind power systems for the small wind (2.5kW-100kW) market as well as power management solutions. As reported by the Troubled Company Reporter on July 3, 2012, Silberstein Ungar, PLLC, in Bingham Farms, Michigan, expressed substantial doubt about XZERES' ability to continue as a going concern, following its audit of the Company's financial position and results of operations for the fiscal year ended Feb. 29, 2012. The independent auditors noted that the Company has incurred losses from operations, has negative working capital, and is in need of additional capital to grow its operations so that it can become profitable. Z TRIM HOLDINGS: Enters Into Joint Development Pact with Newpark ---------------------------------------------------------------- Z Trim Holdings, Inc., has entered into a joint development agreement with Newpark Drilling Fluids LLC, a subsidiary of Newpark Resources, Inc., to develop new, environmentally-friendly drilling fluids that incorporate Z Trim's proprietary industrial materials that could replace the likes of guar and xanthan gums in drilling applications. "Newpark is among the world's largest drilling fluids companies, providing products and services to thousands of wells on four continents, so we're excited to have such a prestigious partner in the development of new oil drilling mud applications using our specialized industrial ingredients," said ZTH CEO, Steve Cohen. "Months of testing has proved that our domestically-sourced ingredients possess unique properties differentiating them from ingredients commonly used in the drilling fluids industry, and further, that our ingredients can deliver superior and expanded functionality. Based on these findings, we are optimistic that our products could have a meaningful impact on the energy industry." Pursuant to the terms of the Agreement, if products using the Materials are successfully developed, the parties agree to negotiate a definitive supply agreement pursuant to which the Company will supply the Materials to Newpark for use into the products. Under the terms of the agreement, Newpark has the exclusive right to use the Materials in certain drilling applications, and the Company is restricted for a period of time from developing the Materials for use in those applications. The Company also granted Newpark a non-exclusive, royalty-free license to use certain of its intellectual property in developing products for the drilling fluids industry. About Z Trim Mundelein, Ill.-based Z Trim Holdings, Inc., is a functional food ingredient company which provides custom product solutions that help answer the food industry's problems. Z Trim's revolutionary technology provides value-added ingredients across virtually all food industry categories. Z Trim's all-natural products, among other things, help to reduce fat and calories, add fiber, provide shelf-stability, prevent oil migration, and add binding capacity -- all without degrading the taste and texture of the final food products. M&K CPAs,PLLC, in Houston, Texas, expressed substantial doubt about the Company's ability to continue as a going concern following the 2011 financial results. The independent auditors noted that the Company had a working capital deficit and reoccurring losses as of Dec. 31, 2011. The Company reported a net loss of $6.94 million in 2011, compared with a net loss of $10.91 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $4.41 million in total assets, $24.99 million in total liabilities, $6.36 million in total commitment and contingencies, and a $26.93 million total stockholders' deficit. * Fitch Says Belt-Tightening Continues for U.S. Consumer -------------------------------------------------------- U.S. consumers are likely to continue being prudent paying down their debts, with personal bankruptcy filings likely to drop again in 2013, according to Fitch Ratings in a new report. Personal bankruptcies fell by over 14% last year, exceeding Fitch's forecast of 11%. This marked the second annual decline since the Bankruptcy Abuse Prevention and Consumer Protection Act was passed in 2005. Fitch is projecting bankruptcies to fall another 6-7% in 2013. This comes as the amount of consumer credit continues to rise. Total consumer credit reached nearly $3 trillion in November 2012, up 6% over 2011. Of that number, nearly $2 trillion came from non- revolving credit sources such as auto and student loans. 'Though consumers are taking out a record number of car and student loans, they continue to do a commendable job of paying that debt off,' said Managing Director Michael Dean. 'Momentum in both the housing and equity markets should also help drive personal bankruptcies lower.' This continues to bode well for ABS collateral performance, which has been stellar for both credit card and auto ABS. That said, credit card delinquencies and chargeoffs will begin inching up toward historical norms in the coming months. The same historical leveling off will also hold true for auto loans. Nonetheless, Fitch expects asset performance to remain strong. Fitch's rating outlook for core consumer ABS sectors will remain stable to positive. 'Personal Bankruptcy Filings to Decline Again' is available at 'www.fitchratings.com or by clicking on the above link. * Outlook for Banks Brighter but Still Tough, Fitch Says -------------------------------------------------------- The outlook for major U.S. banks' equity trading and investment banking businesses may be brightening somewhat in early 2013, but weak volumes and a still sluggish M&A environment are likely to hold back revenue growth in the near term, according to Fitch Ratings. Until a lasting resolution of U.S. fiscal problems is agreed, moreover, equity volumes and trading bank revenues are still exposed to downside risk. Fourth-quarter 2012 equity underwriting, trading, and advisory revenues all showed signs of life relative to abysmal levels reported in 4Q11, when market turmoil surrounding troubles in the eurozone was at a peak. Aggregate capital markets revenues for the top-five U.S. banks (JPM, Citi, BofA, GS, and MS) grew by 39% year over year in the fourth quarter, with fixed income, currencies, and commodities (FICC) revenues driving 47% of the total. Despite the typical seasonal slowdown in the fourth quarter and deep concerns over fiscal issues late in the year, capital markets revenues declined by only 10% sequentially from a generally solid 3Q12. Equity underwriting and advisory revenues for the top-five banks bucked the broader trends, with both categories showing growth in 4Q12 compared with the prior quarter. Underwriting revenues grew by 16% sequentially and 34% year over year. Advisory revenues rose by 17% sequentially and 13% versus the prior-year period. Major banks have generally reported a better pipeline of advisory and equity underwriting activity moving into 2013. However, lingering macro risks linked to developments in Washington and the eurozone have not been addressed to the extent necessary to support rapid growth in deal volume. Relative to debt underwriting, which drove 17% of total capital markets revenues in 4Q12 on the back of robust bond issuance, equity underwriting and advisory accounted for a smaller share of the revenue mix for major U.S. banks (8% and 5%, respectively, of total capital markets revenues in the fourth quarter). Relief surrounding the tax agreement reached at year end has fuelled a pickup in equity volumes and share prices since the beginning of January (S&P 500 up 4.7% ytd). Still, market activity could again be hit by fiscal uncertainties in March, when debate over sequestration and the expiration of federal spending authority could raise the risk of fiscal drag later in the year. The first quarter is typically the strongest for U.S. banks' capital markets revenues. A continuation of somewhat better equity market performance witnessed so far in January, coupled with improving deal flow, could set the stage for good capital markets revenue growth in 1Q13. However, the looming fiscal battles that are set to intensify in the spring could undercut any signs of revenue strength evident in the early part of the quarter. Importantly, a recovery in advisory and underwriting volume, driven principally by cyclical factors and a revival of economic growth prospects, may not be followed by a corresponding bounce back in equity trading volumes, which appear to be weakening on a secular basis. In response to the shifts in capital markets activity seen since the crisis, many large banks have reduced headcount significantly. In 4Q12, profitability of capital markets segments generally benefited from efficiency initiatives. We believe this pattern will continue, with increasing specialization in capital markets segments, such as equities trading, M&A advisory, and debt capital, as banks focus on their key strengths. In addition, banks are focused on those businesses within capital markets where they can achieve adequate returns on a Basel III risk-weighted basis. * Moody's Says US Corp. Family Defaults Remain Steady in Q4 2012 ---------------------------------------------------------------- US corporate family defaults remained steady in the final quarter of 2012, Moody's Investors Service says in the latest edition of its quarterly "US Corporate Default Monitor." Just seven non- financial corporate families defaulted during the quarter, for a total of nearly $9 billion, compared with 16 defaults representing approximately $10 billion in the same period a year earlier. "Continuing low interest rates and accessible credit markets have kept the default count light among speculative-grade corporates," says Senior Vice President Lenny Ajzenman, "and we expect it to edge even lower this year." Moody's forecasts the US speculative grade default rate to end 2013 at 3.0%, below the average of 4.5% since 1993 and well below the cyclical peak above 14% in late 2009. Defaults during the fourth quarter of 2012 spanned industries, and included the energy, media, consumer services, manufacturing and transportation sectors. Media companies currently have the highest one-year forecast for defaults. Bankruptcy was the most common type of default during the quarter. Of the seven defaults, four were bankruptcies and three were distressed exchanges. Edison Mission Energy had the largest corporate family default in 2012's final quarter. The unregulated power generation company defaulted on about $4 billion of debt in connection with its bankruptcy filing. In the full-year 2012 a total of 38 speculative-grade corporates defaulted, comprising about $26 billion of debt. The previous year there were 29 defaults representing $19 billion. Distressed exchanges accounted for more than one-third of US corporate defaults last year, approaching the roughly 40% global rate of 2011. And Moody's expects distressed exchanges to remain a common restructuring strategy, Ajzenman says, as junior bondholders seek to avoid even lower recovery from bankruptcies. * Firms Keep Stockpiles of "Foreign" Cash in U.S. ------------------------------------------------- Kate Linebaugh, writing for The Wall Street Journal, reported that a lot of the estimated $1.7 trillion that American companies say they have indefinitely invested overseas is actually sitting in U.S. banks. The report said some companies, including Internet giant Google Inc., software maker Microsoft Corp., and data-storage specialist EMC Corp., keep more than three-quarters of the cash owned by their foreign subsidiaries at U.S. banks, held in U.S. dollars or parked in U.S. government and corporate securities, according to people familiar with the companies' cash positions. The report added that in the eyes of the law, the Internal Revenue Service and company executives, however, this money is overseas As long as it doesn't flow back to the U.S. parent company, the U.S. doesn't tax it and as long as it sits in U.S. bank accounts or in U.S. Treasury's, it is safer than if it were plowed into potentially risky foreign investments, the report said. In accounting terms, the location of the funds may be just a technicality but for people on both sides of the contentious debate over corporate-tax reform, the situation highlights what they see as the absurdity of rules that encourage companies to engage in semantic games, legal gymnastics and inefficient corporate-financing methods to shield profits from U.S. taxes, the report explained. The cash piling up at the nation's biggest corporations will get renewed attention in the weeks ahead, as companies report their fourth quarter and 2012 earnings, WSJ said. Tuesday's reports included updates from Google, which saw its stockpile of cash increase to $48.1 billion from $44.6 billion a year earlier, as well as results from Johnson & Johnson and DuPont Co. The fact that much of the money already is in the U.S. also undermines a central argument made by companies seeking tax relief to bring home money they have earned abroad, tax experts and lawmakers say: That the cash is languishing overseas when it could be invested to the benefit of the U.S. economy, according to WSJ. Edward Kleinbard, a professor at the University of Southern California's Gould School of Law and a former chief of staff for Congress's Joint Committee on Taxation, told WSJ that there is a misperception that companies' excess cash is inaccessible, "somehow held in gold coins and guarded by Rumpelstiltskin. If it is a U.S.-dollar asset, that means ultimately it is in the U.S. economy in some fashion. Where it is not is in the hands of the firm's shareholders." The U.S. is the only major economy whose tax authorities claim a share of a domestic company's profits no matter where those profits are earned but auditors don't require the companies to account for possible taxes on foreign earnings as long as they declare that the funds are permanently invested overseas, WSJ said. The upshot: American companies have a strong incentive to find ways of earning most of their profit overseas and keeping it in the hands of foreign units. WSJ pointed out that recently the U.S. Securities and Exchange Commission has pressed companies to disclose how much tax they would owe if those funds were transferred to the U.S. parent. The idea is to give shareholders a better picture of how much cash would be available if the funds were repatriated. U.S. companies are lobbying Congress to replace the current corporate-tax system with one that would tax only their domestic profits, according to WSJ. Barring that, some say they would accept a tax on their repatriated earnings that is below the country's current corporate-tax rate of 35% so they could use the funds to pay dividends, buy back shares or otherwise put it to work in the U.S. * Securities and Exchange Commission Reins in Ratings Firm ---------------------------------------------------------- Jeanette Neumann, writing for Bloomberg News, reported that the U.S. Securities and Exchange Commission barred Egan-Jones Ratings Co. from issuing ratings on certain bonds, an unprecedented step by the regulator and a setback for a small credit-rating firm with a history of courting controversy. The SEC said Tuesday that Egan-Jones couldn't officially rate bonds issued by countries, U.S. states and local governments, or securities backed by assets such as mortgages, for at least the next 18 months, Bloomberg said. The ban, according to the report, was part of an agreement the SEC reached with Egan-Jones and its president, Sean Egan, to settle charges that they filed inaccurate documents with the regulator in 2008. The SEC alleged that Egan- Jones misled investors about its expertise, and that Mr. Egan caused the firm to violate conflict-of-interest provisions. The firm and Mr. Egan agreed to the settlement without admitting or denying the findings. Mr. Egan didn't respond to a request for comment, Bloomberg said. He has been outspoken in the past in his defense of the firm and its ratings. He helped champion the push to open the ratings industry to more competition, and served as a spokesman on the firm's controversial decision in 2011 to downgrade Jefferies Group Inc. following the collapse of MF Global Holdings Ltd., Bloomberg recalled. And when the SEC filed charges against him and his firm last April, Mr. Egan openly criticized the agency's action. "We are not going to be intimated by anybody from issuing timely, accurate ratings," he told The Wall Street Journal. William Hassiepen, Egan-Jones's vice president, played down the settlement's effect on the firm's future. "We don't think it's going to put us out of business because we're primarily a corporate ratings service," Mr. Hassiepen told Bloomberg. The firm doesn't charge investor-clients for sovereign ratings, so it won't suffer a decline in revenue because of the SEC's ban in that area, he said. The impact of the settlement on the firm's reputation was less clear-cut, Mr. Hassiepen said. "Any kind of an SEC action is always concerning," he said. Egan-Jones is one of nine credit-ratings firms registered with the SEC, Bloomberg noted. Mr. Egan was a banker and a consultant before launching Egan- Jones's precursor, Red Flag Research Inc., in 1992, Bloomberg recalled. Mr. Egan lobbied lawmakers starting in the late 1990s to allow his firm to register with the SEC. During that time, he claimed the agency was coddling the major firms by upholding barriers to entry, kicking off a stream of criticism that would culminate in his barbs about the investigation into his own firm. The agency approved Egan-Jones as a recognized ratings firm for certain securities in December 2007, according to Bloomberg. That made it easier for issuers and investors to use the firm's ratings, but it did little to loosen the stranglehold of the industry's biggest players. McGraw-Hill Cos.'s Standard & Poor's Ratings Services, Moody's Corp.'s Moody's Investors Service and Fimalac SA and Hearst Corp.'s Fitch Ratings issued around 96% of all ratings as of December 2011, according to a November 2012 SEC report, Bloomberg said. Egan-Jones has five credit analysts and supervisors, while S&P has 1,416 and Moody's has 1,252, according to the report. Mr. Egan charges investors and other clients for ratings, a business model he has said is less prone to conflicts than the payment plans used by all the major ratings firms, which are paid by bond issuers to rate the debt they sell but regulators have said both business models are open to potential conflicts of interest, Bloomberg said. The SEC said on Tuesday that Egan-Jones "falsely stated" in regulatory filings that it didn't know whether clients held a "long" or a "short" position in securities the firm rated but in at least three instances, clients' positions were "conveyed" to Mr. Egan, the agency said, Bloomberg quoted. The firm's rating reports don't typically move markets but in late 2011, Egan-Jones downgraded Jefferies on concerns about sovereign- debt exposure, sparking a selloff in its stock, Bloomberg noted. Investors already were on edge after MF Global collapsed in part because of its European sovereign bonds. Chris Kotowski, a bank analyst at Oppenheimer & Co., wrote a report that year titled "Another Hack Attack" that criticized Egan-Jones's analysis. "If the Jefferies report is representative of [Egan-Jones's] quality control generally, then I'm not surprised that the SEC had issues," Mr. Kotowski told Bloomberg. According to the SEC, in the firm's 2008 application to become an officially recognized ratings firm, Egan-Jones said that it had 150 outstanding ratings on asset-backed securities and 50 outstanding ratings on government issuers, Bloomberg said. The firm's application said it had been issuing the ratings since 1995 but the SEC said Tuesday that Egan-Jones hadn't issued any asset- backed or government ratings that were accessible on the Internet or elsewhere. That meant Egan-Jones "did not meet the requirements for registration as [an SEC-registered rating firm] in these classes," the agency said, according to Bloomberg. The firm continued to make those "material misrepresentations" in subsequent securities filings, the agency said. The SEC said Egan-Jones and Mr. Egan agreed to put in place internal controls that address the issues raised in the settlement and in a 2012 annual examination of the firm by the agency's Office of Credit Ratings, according to the report. The settlement serves "as a warning to others, to set a precedent that says, 'Look, this is behavior we don't think is appropriate and we're going to take appropriate action," Lawrence J. White, a professor at New York University's Stern School of Business, told Bloomberg. Mr. Egan's lawyer, Alan S. Futerfas, said the firm will continue to issue ratings on sovereign and asset-backed debt. Those ratings just won't be registered with the SEC, Bloomberg related. Egan- Jones will consider reregistering with the SEC once the ban is lifted, Mr. Futerfas said. "We're hopeful and optimistic that the settlement won't have impact on the income or reputation of the business," Mr. Futerfas said. * Consumer, Corporate Defaults Predicted to Continue Falling ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, disclosed that according to reports from Fitch Ratings and Moody's Investors Service, lawyers who make their livings from personal and corporate bankruptcies will have fewer clients this year, The 1.16 million personal bankruptcies in 2012 were 14.5% fewer than in 2011 and will decline another 6% to 7% this year, Fitch said in a report. On the corporate front, there were seven defaults among non- financial companies with $9 billion in debt during the fourth quarter, compared with 16 defaults on $10 billion in junk debt the year before, Moody's said in a Jan. 22 report. The junk-debt default rate ended the fourth quarter at 3.2%, down from 3.6% when the third quarter ended. Moody's predicts the default rate will decline further to 3% by the year's end, compared with the 4.5% average since 1993 and the 14% peak in 2009. On the consumer side, Fitch said that credit card delinquencies were down in 2012 even though consumer debt rose 6% year over year to end November at $2.8 trillion. The "lion's share" of the increase in consumer debt came from student loans, Fitch said. The increase results from unemployed individuals going to school for retraining. Fitch noted that student-loan debt ordinarily can't be shed in bankruptcy. Credit-card chargeoffs fell to 3.98%, the lowest since 2006. The chargeoff rate is a 29% improvement over the end of 2011, Fitch said. Auto-loan defaults are also at historically low levels, according to Fitch. Fitch believes credit-card defaults may be reaching bottom and return to more normal levels in the last half of 2013. An increase in part would result from decisions by lenders to spur growth by lowering credit standards, Fitch said. * Starwood to Buy LNR Properties for $1.05 Billion -------------------------------------------------- The New York Times' DealBook reports that real estate mogul Barry S. Sternlicht's two companies -- Starwood Capital Group and Starwood Property Trust -- on Thursday agreed to pay $1.05 billion for distressed debt manager LNR Property, bolstering their positions in distressed commercial real estate. According to the report, the Starwood Capital Group, a private investment firm, will pay $197 million for LNR's commercial property group in the United States and a piece of Auction.com. A corporate affiliate, Starwood Property Trust, a real estate investment trust, will pay $856 million for various units, including loan servicing businesses in the United States and Europe as well as portfolios of commercial mortgage backed securities and other assets. The deal is expected to close in the second quarter. NY Times says the deal comes at a potentially opportune time in the industry. Big banks, particularly in Europe, have been unloading assets to raise capital and shore up their balance sheets. The largest financial institutions in Europe are expected to sell $78 billion of noncore assets this year, with many reducing their exposure to real estate, according to a study by PricewaterhouseCoopers. NY Times recounts that after the financial crisis, Starwood Capital and other investors acquired a $4.5 billion real estate loan portfolio of Corus Bank, which had failed. He also made a run at Extended Stay Hotels in bankruptcy. * SEC Names V. Martinez as Office of Market Intelligence Head ------------------------------------------------------------- Ben Protess, writing for The New York Times' DealBook, reported that the U.S. Securities and Exchange Commission announced on Tuesday that Vincente L. Martinez, a veteran of the agency, will run a powerful unit that culls tips about Wall Street wrongdoing. The unit, named the Office of Market Intelligence, was a central feature of the S.E.C.'s makeover in the aftermath of the financial crisis, the report said. Known at the agency as the "point guard" of the enforcement division, the office harvests tips, opens investigations and assigns cases to enforcement lawyers. "Our Office of Market Intelligence employs next-generation technology and data analysis to inform and drive our enforcement effort and priorities in the years to come," the DealBook quoted Robert Khuzami, the S.E.C.'s enforcement director, as saying. "Vince has the vision and dedication to lead that effort given his talent, commitment, and prior service to the S.E.C.," added Mr. Khuzami, who recently announced that he would leave the agency. A longtime regulator, Mr. Martinez has close ties to the S.E.C. and the Office of Market Intelligence, according to the DealBook. He was an S.E.C. enforcement lawyer for eight years, a tenure that included a stint as assistant director of the intelligence unit. Mr. Martinez, the S.E.C. said, will return to the agency next month, the DealBook related. The S.E.C. poached him from the Commodity Futures Trading Commission, where he was the first director of the agency's whistle-blower office. "I am honored and pleased to rejoin the S.E.C. staff," Mr. Martinez said in the statement, highlighting the intelligence unit's "contributions to the protection of investors by further developing our ability to proactively identify risks and ferret out misconduct." The S.E.C.'s enforcement roster is in transition, the DealBook noted. Mr. Khuzami, who has not yet announced his next step, will depart in the coming days, according to the report. Mr. Martinez fills a gap that opened when Thomas A. Sporkin, the inaugural director of the intelligence division, exited last summer. Mr. Sporkin built a team of more than 40 former traders, accountants and securities lawyers who would sift through the hundreds of tips the agency receives each day. He also collaborated with the Federal Bureau of Investigation to have agents embedded with the regulator. Mr. Sporkin was initially replaced by Lori Walsh, who became the acting chief of the intelligence unit. Ms. Walsh, the agency said, will stay on as Mr. Martinez's deputy. * BOOK REVIEW: Performance Evaluation of Hedge Funds ---------------------------------------------------- Edited by Greg N. Gregoriou, Fabrice Rouah, and Komlan Sedzro Publisher: Beard Books Hardcover: 203 pages Listprice: US$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., Washington, D.C., 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 2013. 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 $975 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 Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. *** End of Transmission ***