/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/130214.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, February 14, 2013, Vol. 17, No. 44 Headlines 30DC INC: Raine Ventures Reports 12.1% Equity Stake 30DC INC: MagCast Launches 250th Magazine on Apple Newsstand 6537 MELROSE: Involuntary Chapter 11 Case Summary AIDA'S PARADISE: Files Plan to Continue Business, Keep Control AIRTRONIC USA: Global Shareholder Provides Assets for Merger AFFINITY GAMING: Buyout Offer No Impact on Moody's 'B1' CFR AMERICAN AIRLINES: Said to Formally Announce Merger Today AMERICAN AIRLINES: U.S. Bank Appeals $1.5-Bil. Loan Approval AMERICAN AIRLINES: Seeks to Sell & Lease Back 15 Boeing Planes AMERICAN AIRLINES: To Pay $1.9-Mil. for Miami Dade Baggage System AMERICAN AIRLINES: Committee Seeks to Retain Hay Group AMERICAN APPAREL: Inks 5th Amendment to Crystal Credit Agreement AMWINS GROUP: S&P Assigns 'B' Rating on $715MM 1st-Lien Term Loan ASPEN GROUP: Has 3.1 Million Shares Resale Prospectus ATP OIL: EPA Initiates Civil Environmental Suit AVIATION ROAD: Case Summary & 6 Largest Unsecured Creditors API TECHNOLOGIES: Moody's Withdraws Ratings After Debt Payment ARCAPITA BANK: Chapter 11 Plan Contemplates $185-Mil. Loan ARCHDIOCESE OF MILWAUKEE: Claimants Want Insurance Taken Up First ARCHDIOCESE OF MILWAUKEE: Sex Abuse Claims Go to Trial ARCHDIOCESE OF MILWAUKEE: Late-Filed Sex Abuse Claim Disallowed BAKERS FOOTWEAR: Seeks to Auction Intellectual Property BBX CAPITAL: Dimensional Fund Discloses 3.8% Equity Stake BEHRINGER HARVARD: Completes Liquidation of Assets Under Plan BERNARD L. MADOFF: Trustee Proposes Third Distribution BERRY PLASTICS: Graham Berry Discloses 5.4% Equity Stake BERRY PLASTICS: Borrows Add'l $1.4 Billion From Credit Suisse BOB COOK: Maloofs Give Ch. 11 Trustee Sacramento Kings Sale Docs BON-TON STORES: Lombard Odier Discloses 9.4% Equity Stake BLUEGREEN CORP: Dimensional Fund Discloses 8.5% Equity Stake BRIER CREEK: Court Sends BofA Dispute to Arbitration CALUMET SPECIALTY: New Refinery JV No Impact on Moody's 'B2' CFR CAMP INTERNATIONAL: S&P Assigns 'B' Rating to $370MM 1st-Lien Loan CENTENNIAL BEVERAGE: Wants Court's OK to Pay Critical Vendors CENTENNIAL BEVERAGE: Files Schedules of Assets and Liabilities CENTRAL EUROPEAN: M. Kaufman Nominates Self, 3 Others to Board CHAMPION INDUSTRIES: Dimensional Fund Reports 6.7% Equity Stake CIT GROUP: S&P Revises Outlook on 'BB-' ICR to Positive CITIBANK: Moody's Affirms (P)Ba2 Rating on Jr. Subordinated Debt COMARCO INC: Consummates $2.5-Mil. Elkhorn Debt & Equity Financing COMSTOCK MINING: Peter Palmedo Discloses 11.7% Equity Stake CVR REFINING: Moody's Lowers Rating on $500MM Debt to 'B2' DETROIT, MI: Governor Has Short List of Managers If Needed DEWEY & LEBOEUF: Employee Class Suit Survives Dismissal Bid DEWEY & LEBOEUF: Ex-Partners Call Bankruptcy Plan a Fraud DEWEY & LEBOEUF: Inks Settlement with 125 Retired Partners DIOCESE OF WILMINGTON: Trustee Objects to Tort Claim No. 70 DVORKIN HOLDINGS: Trustee Hiring Entre as Real Estate Broker DRYSHIPS INC: Announces Upsizing & Pricing of Ocean Rig Shares EASTBRIDGE INVESTMENT: Amends Merger Agreement with CBMG ENERGYSOLUTIONS INC: Seeks to Amend Credit Facility with JPMorgan EXCEL DIRECTIONAL: Case Summary & 20 Largest Unsecured Creditors FAIRWEST ENERGY: CCAA Stay Extended to March 15 FARER FRESKO: $1.8-Mil. Deal Resolves Claims over Bankruptcy FLEXIBLE FLYER: Workers' WARN Act Suit Crashes in 5th Circuit FLEXTRONICS INT'L: Moody's Assigns 'Ba1' Rating to New Sr. Notes FTMI REAL ESTATE: Court Dismisses Chapter 11 Case GELTECH SOLUTIONS: Incurs $1.4 Million Net Loss in Dec. 31 Qtr. GENE CHARLES: Can Enter into Pipeline Agreements With AMS GLOBAL AVIATION: Exits Chapter 11 Bankruptcy GSC GROUP: Capstone Reaches Settlement with U.S. Trustee GSC GROUP: US Trustee Wrests $1.2MM from Advisers Over Fee-Sharing HERCULES OFFSHORE: Dimensional Fund Reports 8% Equity Stake HOVNANIAN ENTERPRISES: State Street Discloses 1.4% Equity Stake IBIO INC: NYSE MKT Accepts Listing Compliance Plan INTERACTIVE DATA: Moody's Rates $1.3-Bil. Refinanced Debt 'Ba3' ISTAR FINANCIAL: Vanguard Group Discloses 5.1% Equity Stake J&J DEVELOPMENTS: Can Hire Jimmie Taylor as Realtors JAMES RIVER: BlackRock Lowers Equity Stake to 5.3% JAMES RIVER: Vanguard Group Reports 5.9% Equity Stake JOHN PATRICK STOKES: Fails to Dismiss Duncan-Glover Suit JOURNAL REGISTER: Halts Auction for $122-Mil. Stalking Horse Deal K-V PHARMACEUTICAL: Noteholders Have No Lien on Makena Drug LEHMAN BROTHERS: To Sell Park Avenue Property for More Than $800MM LOCATION BASED TECHNOLOGIES: Jeffrey Devlin Named to Board MACCO PROPERTIES: Kevin Coffey Withdraws as Counsel for MA Cedar MACCO PROPERTIES: UST & Committee Still Object at 5th Attempt MARIANA BRACETTI: S&P Lowers Rating on 2011 Revenue Bonds to 'BB' MAUI LAND: ValueWorks Discloses 7% Equity Stake MCCLATCHY CO: Dimensional Fund Owns 6.3% of Class A Shares MEDIA GENERAL: Dimensional Fund Owns 4.9% of Class A Shares MEDICAL INTERNATIONAL: Incurs $256,000 Net Loss in Dec. 31 Qtr. MF GLOBAL: Adds Language to Plan Outline to Resolve Objections MF GLOBAL: Ch. 11 Objections Premature, Plan Proponents Say MILACRON HOLDINGS: S&P Puts 'B+' CCR on CreditWatch Negative MILACRON HOLDINGS: Moody's Reviews B1 CFR for Possible Downgrade MONSEN ENGINEERING: Case Summary & 20 Largest Unsecured Creditors MPG OFFICE: Sorin NL Owns 6.4% of Cumulative Preferred Shares NEW YORK WESTCHESTER: Must Close Sale by March 31 or Face Shutdown NIELSEN HOLDING: S&P Affirms 'BB' Corp. Credit Rating NORTEL NETWORKS: Creditors Battle Over Trial on Cash Split NORTEL NETWORKS: U.S. Unit Pans Canadian Retirees' Relief NORTH BY NORTHWEST: Court Dismisses Chapter 11 Case NPS PHARMACEUTICALS: Wellington Discloses 10.8% Equity Stake NY DOWNTOWN HOSPITAL: NY-Presbyterian Offered Bail Out PACIFIC THOMAS: Court Appoints Kyle Everett as Chapter 11 Trustee PATRIOT COAL: 2013 Incentive Plan and CERP to Cost $6,950,000 PATRIOT COAL: UMWA Balks at $6-Mil. Bonus Plan for Executives PERFORMANCE TRANSPORTATION: "New Value" Defense Tackled in Suit PHIL'S CAKE: Seeking Extension of Time to File Exit Plan PHIL'S CAKE: Files Schedules of Assets and Liabilities PHIL'S CAKE: Court OKs Rick Fernandez as Property Manager PHIL'S CAKE: Hires Levin Papantonio to Pursue BP/Deepwater Claim PREMONT INDEPENDENT: Moody's Keeps 'Ba1' Rating on GOUT Bonds REDCATS USA: S&P Gives 'B' CCR; Affirms 'B' Rating on $305MM Loan RESIDENTIAL CAPITAL: $7.2-Bil. Book Value of Assets as of Dec. 31 RESIDENTIAL CAPITAL: Centerbury Lawsuit vs. JPMorgan to Proceed RESIDENTIAL CAPITAL: Ally CEO Threatens to Withdraw $750-Mil. Deal RESIDENTIAL CAPITAL: Ocwen to Buy Mortgage Servicing Platform REVEL AC: Inks Fourth Amendment to JPMorgan Credit Agreement RG STEEL: Sues Suppliers to Recover Preferential Transfers RG STEEL: Wants to Sell Asset to Bounty Mineral for $3.17-Mil. ROBIN CINI: Former Spouse Sanctioned for Violating Automatic Stay RTJJ INC: Community One Bank Fails to Block Plan Confirmation SCHOOL SPECIALTY: Lee Munder Files Amended Schedule 13G with SEC SCHOOL SPECIALTY: Dimensional Fund Discloses 7.4% Equity Stake SEARS HOLDINGS: Holds 51% Equity Stake in Sears Canada Inc. SELECT MEDICAL: Moody's Rates Proposed Senior Term Loan 'B1' SIONIX CORP: Has 99.3 Million Common Shares Resale Prospectus SMART & FINAL: Term Loan Amendment No Impact on Moody's 'B3' CFR SOMERSET THOR: Updated Case Summary & Creditors' Lists STARZ LLC: Sony Output Deal No Impact on Moody's 'Ba2' CFR STEREOTAXIS INC: Franklin Resources Holds 19.2% Equity Stake TEAM FINANCIAL: FDIC Expert Testimony Barred in Tax Refund Suit TELETOUCH COMMUNICATIONS: Obtains $6MM Revolver Loan From DCP TITAN PHARMACEUTICALS: First Eagle Discloses 9.9% Equity Stake TRANSDIGM INC: S&P Assigns 'BB-' Rating on New $2.51BB Facility TRILLIUM FAMILY: Case Summary & 20 Largest Unsecured Creditors UNIVERSAL HEALTH: Hearing Today on BankUnited Bid for Dismissal UNIVERSAL HEALTH: BankUnited Seeks Bar on Use of Cash, Tax Refund UNIVERSAL HEALTH: Taps Katten Muchin as General Bankruptcy Counsel UNIVITA HEALTH: Weak Performance Cues Moody's to Cut CFR to 'B3' VIGGLE INC: To Issue Additional 15 Million Shares Under Plan VISUALANT INC: Incurs $701,000 Net Loss in Dec. 31 Quarter WESTMORELAND COAL: T. Rowe Price Discloses 5.4% Equity Stake WHITTYMORE LLC: Case Summary & 5 Unsecured Creditors ZALE CORP: Dimensional Fund Discloses 8.4% Equity Stake * More Stable Airlines Fly Out of Mergers * Libor Scrutiny Turns to Middlemen * U.S. Banks' Bulk Distressed Loan Sales to Grow, Fitch Reports * Moody's Notes Decline of High-Yield Bond Covenant Protections * 2012 Downgrades on Non-Profit Healthcare Debts Reach $20-Bil. * Morgan Joseph Triartisan Aided Versa Unit in $62.5MM Financing * Recent Small-Dollar & Individual Chapter 11 Filings ********* 30DC INC: Raine Ventures Reports 12.1% Equity Stake --------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Dan Raine, a managing member and beneficiary of Raine Ventures, LLC, disclosed that, as of Dec. 31, 2012, he beneficially owns 10,560,000 shares of common stock of 30DC, Inc., representing 12.15% of the shares outstanding. A copy of the filing is available for free at http://is.gd/kKd19Q About 30DC Inc. New York-based 30DC, Inc., provides Internet marketing services and related training to help Internet companies in operating their businesses. It operates in two divisions, 30 Day Challenge and Immediate Edge. The Company reported a net loss of $1.44 million for the fiscal year ended June 30, 2011, following a net loss of $1.06 million in fiscal 2010. As reported in the TCR on Dec. 19, 2011, Marcum LLP, in New York, expressed substantial doubt about 30DC's ability to continue as a going concern, following the Company's results for the fiscal year ended June 30, 2011. The independent auditors noted that the Company has had recurring losses, and has a working capital and stockholders' deficiency as of June 30, 2011. The Company's balance sheet at March 31, 2012, showed $1.82 million in total assets, $2.21 million in total liabilities and a $394,450 total stockholders' deficiency. The Company said in its quarterly report for the period ending March 31, 2012, that if it is unable to raise additional capital or encounters unforeseen circumstances, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, issuance of additional shares of the Company's stock to settle operating liabilities which would dilute existing shareholders, curtailing its operations, suspending the pursuit of its business plan and controlling overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions raise substantial doubt about the Company's ability to continue as a going concern. 30DC INC: MagCast Launches 250th Magazine on Apple Newsstand ------------------------------------------------------------ 30DC, Inc., has recently added to its impressively growing list of MagCast-delivered magazines. The Company said that the 250th unique magazine title has now launched on Apple Newsstand using the MagCast digital publishing platform. MagCast was formally launched in June of last year, as a cloud- based service that creates an application for customers to publish a digital magazine on Apple Corporation's online marketplace Apple Newsstand. The service includes executive training manuals and tools on everything that is needed to start a magazine from scratch, niche content creation strategies, and complete instructions on how to publish on Newsstand. Since MagCast was launched midway through 2012 the platform has experienced continuous growth in its user base which has continued into 2013. "Today's announcement is a major milestone, with 250 magazines MagCast has built a large magazine network that continues to grow at a rapid pace," the Company said in a press release. "This illustrates that MagCast is a go-to publishing platform for the self-publishing magazine market. Anyone or entity with a niche idea or a market that is interested in creating, distributing and monetizing a magazine can now look to MagCast and view 250 unique, real-world examples on how this is done." 30DC also advised that Good Light! Magazine, (one of the initial magazines launched through the MagCast platform) a magazine about portrait photography for amateurs, has just published its third issue in Apple's Newsstand and the new issue has already exceeded 10,000 readers. The magazine sells for $3.99 per issue or $2.99 for subscribers and is produced in Germany. In 2013, 30DC will focus on enhancing the MagCast platform with additional features that will increase current MagCast users' ability to obtain additional subscribers, distribute their content and ultimately increase their profits as well increase MagCast's appeal to potential new users. About 30DC Inc. New York-based 30DC, Inc., provides Internet marketing services and related training to help Internet companies in operating their businesses. It operates in two divisions, 30 Day Challenge and Immediate Edge. The Company reported a net loss of $1.44 million for the fiscal year ended June 30, 2011, following a net loss of $1.06 million in fiscal 2010. As reported in the TCR on Dec. 19, 2011, Marcum LLP, in New York, expressed substantial doubt about 30DC's ability to continue as a going concern, following the Company's results for the fiscal year ended June 30, 2011. The independent auditors noted that the Company has had recurring losses, and has a working capital and stockholders' deficiency as of June 30, 2011. The Company's balance sheet at March 31, 2012, showed $1.82 million in total assets, $2.21 million in total liabilities and a $394,450 total stockholders' deficiency. The Company said in its quarterly report for the period ending March 31, 2012, that if it is unable to raise additional capital or encounters unforeseen circumstances, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, issuance of additional shares of the Company's stock to settle operating liabilities which would dilute existing shareholders, curtailing its operations, suspending the pursuit of its business plan and controlling overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions raise substantial doubt about the Company's ability to continue as a going concern. 6537 MELROSE: Involuntary Chapter 11 Case Summary ------------------------------------------------- Alleged Debtor: 6537 Melrose Avenue Partnership 6537 Melrose Avenue Los Angeles, CA 90038 Case Number: 13-13451 Involuntary Chapter 11 Petition Date: February 11, 2013 Court: Central District Of California (Los Angeles) Judge: Richard M. Neiter Petitioner's Counsel: Daniel H. Reiss, Esq. LEVENE, NEALE, BENDER, YOO & BRILL LLP 10250 Constellation Blvd Ste 1700 Los Angeles, CA 90067 Tel: (310) 229-1234 Fax: (310) 229-1244 E-mail: dhr@lnbyb.com 6537 Melrose Avenue Partnership's petitioner: Petitioner Nature of Claim Claim Amount ---------- --------------- ------------ Barbara Leibovic 12400 Wilshire Ste 400 Los Angeles, CA 90025 AIDA'S PARADISE: Files Plan to Continue Business, Keep Control -------------------------------------------------------------- Aida's Paradise, LLC, filed a Plan of Reorganization, as amended, which contemplates that the Debtor will continue to manage and lease to tenants its I-Drive properties, and will continue to try to secure a new restaurant tenant. According to the Amended Disclosure Statement, the Debtor believes that its current cash flow form the rental income and monthly contributions from the Principals to make any budget shortfalls up to 12 months after the Effective Date, are sufficient to make payments to all Allowed Classes of Claims. TD Bank, owed $5,958,175 on a secured claim (Class 1), will retain its lien on the I-Drive Properties, and will receive payments of principal and interest based on a 25 year amortization, with an annual interest rate of 4.5%, and a balloon payment due 5 years from the Plan Effective Date, except that for the first six months of the Plan the Debtor will make monthly interest-only payments to TD Bank. The holder of secured property tax claims (Class 2) will retain its lien on the I-Drive Properties and be paid 100% of its allowed secured claims in monthly payments of principal and interest at the statutory rate based on a 25 year amortization, and with a final maturity 60 months from the Petition date. Holders of general unsecured claims (Class 3) will be paid a pro rata share of the cash flow note. Holders of interests will retain their interest in the Debtor and will contribute the "new value" to the Debtor to pay TD Bank's claim for the first six months of the Plan or until the Debtor secures a new Restaurant Tenant. The current estimate of the New Value to be contributed is approximately $134,976. TD Bank's equitably subordinated claim will be subject to the Debtor's set-off rights due to any damages determined in the TD Bank adversary proceeding. To the extent the Allowed Amount of the claim exceeds the set-off, TD Bank will be paid pursuant to the terms of the cash flow note after all Holders of Class 3 General Unsecured Claims have been paid in full. A copy of the Amended Disclosure Statement is available at: http://bankrupt.com/misc/aida'sparadise.doc175.pdf About Aida's Paradise Based in Maitland, Florida, Aida's Paradise LLC owns roughly three acres of developed real property on International Drive in Orlando, Florida. It leases various parcels of the I-Drive Property to three tenants: Volcano Island Mini Golf, Dunkin Donuts (aka Jennifer's Donuts), and CBS Outdoor (which operates an electronic billboard on site). Aida's Paradise filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 12-00189) on Jan. 6, 2012. Chief Karen S. Jennemann presides over the case. R. Scott Shuker, Esq., at Latham Shuker Eden & Beaudine LLP, serves as the Debtor's counsel. Terry J. Soifer and Consulting CFO, Inc., serves as its financial advisor. The petition was signed by Dr. Adil R. Elias, manager. In its schedules, the Debtor disclosed $15.0 million in total assets and $9.32 million in total liabilities. AIRTRONIC USA: Global Shareholder Provides Assets for Merger ------------------------------------------------------------ Global Digital Solutions on Feb. 13 disclosed that its majority shareholder, Richard J. Sullivan, provided $300,000 in collateralized assets to secure a $750,000 bridge loan that will facilitate the planned merger with Airtronic USA. Mr. Sullivan described his $300,000 infusion as "a vote of confidence" in Airtronic and the company's President and CEO, Dr. Merriellyn Kett. Because Airtronic is currently a "debtor in possession" under Chapter 11 of the Bankruptcy Code, the $750,000 bridge loan from GDSI to Airtronic was subject to approval from the United States Bankruptcy Court for the Northern District of Illinois. Approval for the bridge loan was granted on October 18, 2012. On August 20, 2012, the GDSI and Airtronic announced that they had signed a letter of intent to enter into good faith discussions involving a potential strategic combination in which Airtronic would be acquired by GDSI. Having completed those good faith discussions, the companies signed a merger agreement and reorganization plan on October 16, 2012. The agreement, which is also subject to Bankruptcy Court approval, calls for Airtronic to continue to operate as a subsidiary of GDSI. "We're very excited that we have completed this critical phase of the merger process between GDSI and Airtronic and we're looking forward to completing the process as quickly as possible," said Mr. Sullivan, who will become chairman and CEO of GDSI after the acquisition is completed. "It's important to note," Mr. Sullivan added, "that Airtronic instituted a policy twelve years ago never to sell weapons to the domestic U.S. commercial and/or retail market. And I applaud Dr. Kett and her team for having the vision to embrace that policy. Airtronic only supplies these weapons to the U.S. military and designated militaries abroad. That's an important distinction that will continue to be a vital part of Airtronic's business model going forward." Dr. Kett, Airtronic's CEO and President, also commented on the bridge loan: "I'm very grateful to Dick Sullivan for his vote of confidence and I'm delighted that we have taken this important step in the merger process, which we believe will be very beneficial to both companies and to our shareholders and customers." Once the merger is finalized, Dr. Kett is expected to continue serving as CEO of Airtronic. About Richard J. Sullivan Dick Sullivan is an entrepreneurial pioneer. He served as Chairman and CEO of Applied Digital Solutions, where he executed a technology rollup involving 42 acquisitions that succeeded in increasing the company's share price from $2.50 to a peak of $18 per share. During Sullivan's decade-long tenure as Chairman and CEO, Applied Digital was one of the highest volume traded stocks on NASDAQ. Mr. Sullivan also served as Chairman and CEO of Digital Angel Corporation and led the effort to spin off VeriChip Corporation. In 1970, he was a founding member of the management team of Manufacturing Data Systems, Inc., which listed at $7.50 per share and was sold to Schlumberger N.V. in 1980 at $65 per share. About Merriellyn Kett, PhD Airtronic's CEO and President joined the company in 2003 as a partner and helped to refocus the business on several essential battlefield weapons, including the M203 40mm Grenade Launcher -- one of the most widely used grenade launchers in the world -- the .50 cal. Machine Gun, the MK 19 Grenade Machine Gun, and most recently the MK 777, a shoulder-fired recoilless rifle that is light, lethal, and affordable. Dr. Kett received her doctorate in analytic philosophy from DePaul University in Chicago, IL, and spent a year studying at the Sorbonne in Paris, France. Before joining Airtronic in 2003, she worked in infrastructure development in China, building a metallurgical coking plant in Shanxi Province. About Global Digital Solutions, Inc. Global Digital Solutions -- http://www.gdsi.co-- is refocusing its business strategy on providing knowledge-based and culturally attuned societal consulting and security-related solutions in unsettled areas. About Airtronic USA Airtronic -- http://www.Airtronic.net/-- is an electro-mechanical engineering design and manufacturing company. It provides small arms and small arms spare parts to the U.S. Department of Defense, foreign militaries, and the law enforcement market. The company also manufactures medical, avionics, and telecommunications original equipment. The company's products include grenade launchers, rocket propelled grenade launchers, grenade launcher guns, flex machine guns, grenade machine guns, rifles, and magazines. The company was founded in 1990 and is based in Elk Grove Village, Illinois. On May 16, 2012, the voluntary petition of Airtronic, Inc. for liquidation under Chapter 7 was converted to Chapter 11 reorganization. The company had filed for Chapter 7 bankruptcy on March 13, 2012. AFFINITY GAMING: Buyout Offer No Impact on Moody's 'B1' CFR ----------------------------------------------------------- Moody's Investors Service said Affinity Gaming Corporation's B1 Corporate Family Rating and stable rating outlook are unaffected by yesterday's announcement that Illinois based Z Capital Partners (not rated), Affinity's largest shareholder of record, made an offer to purchase all of Affinity's shares outstanding that it doesn't already own. The principal methodology used in rating Affinity Gaming Corporation was the Global Gaming Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. AMERICAN AIRLINES: Said to Formally Announce Merger Today --------------------------------------------------------- Mike Spector and Susan Carey, writing for The Wall Street Journal, report that people familiar with the matter said the boards of American Airlines parent AMR Corp. and US Airways Group Inc. late Wednesday separately voted to approve a merger of the two carriers. The sources told WSJ that the merger will be formally announced early Thursday morning, and a so-called plan support agreement outlining all of the deal's details is set to be filed the same day with the U.S. Bankruptcy Court in New York. The report notes the airlines met at the New York offices of their respective legal advisers in midtown Manhattan Wednesday afternoon, at times concurrently: -- American's board met at the offices of law firm Weil, Gotshal & Manges LLP; and -- US Airways' board met at law firm Latham & Watkins LLP. WSJ described the transaction as an all-stock deal: American's creditors would own 72% of the combined airline, and US Airways shareholders the balance. WSJ's sources said the combined airline will likely have a market capitalization exceeding $10 billion, and the value could approach $11 billion. Sources told WSJ that US Airways Chief Executive Doug Parker will run the combined company as chief executive and AMR CEO Tom Horton will serve as nonexecutive board chairman, likely until the spring or summer of 2014, the time of the new company's first annual meeting after American emerges from bankruptcy protection. The new board will have 12 directors, one of the people said. American's creditors will appoint five directors, American will appoint three and US Airways four, this person said. The number of directors will fall to 11 when Mr. Horton departs as chairman, this person said. According to the report, the deal will underpin AMR's bankruptcy exit plan. The merger plan will require approval from the Bankruptcy Judge overseeing American's case, and from antitrust regulators at the U.S. Justice Department and elsewhere, which could take a few months. Some of the sources told WSJ that the deal would repay AMR's creditors nearly all their debts and AMR's existing common shareholders are expected to get some kind of financial recovery at some point as part of the merger. AMR's common stock continues to trade, but is expected to be extinguished once the company issues new shares in the combined entity. About American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: U.S. Bank Appeals $1.5-Bil. Loan Approval ------------------------------------------------------------ U.S. Bank Trust N.A. appealed a bankruptcy judge's ruling, which authorized AMR Corp. to obtain as much as $1.5 billion in financing. Judge Lane of the U.S. Bankruptcy Court in Manhattan authorized AMR on February 1 to obtain the $1.5 billion in financing, and to pay off $1.32 billion in loans with the new financing without paying a so-called make-whole premium. U.S. Bank, which relied in part on the so-called 1110 election that AMR made early in the bankruptcy, failed to convince the bankruptcy judge that the make-whole premium is due. 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 was not convinced that the 1110 election obliged AMR to pay the make-whole, citing provisions in the indenture saying that the make-whole isn't owing if the underlying default results from bankruptcy. The bankruptcy judge also 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. The stay of Judge Sean Lane's February 1 order was to expire at 11:59 p.m. Feb. 12, according to a stipulation signed by AMR Corp. and U.S. Bank Trust N.A. AMR's previous 1.32 billion loan, which is secured by Boeing planes, was obtained through an enhanced equipment trust certificate financing and a secured notes financing entered into by American Airlines Inc., AMR's regional carrier, before its bankruptcy filing. AMR is also authorized to pay off the pre-bankruptcy loan without paying a so-called make-whole premium, according to the bankruptcy court's order issued on February 1. A copy of the order is available at no charge at http://is.gd/M6uCpv About American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Seeks to Sell & Lease Back 15 Boeing Planes -------------------------------------------------------------- AMR Corp. filed a motion seeking court permission to implement a sale and simultaneous leaseback of 15 Boeing 737-823 planes and one Boeing 777-323ER plane with International Lease Finance Corp. The 15 Boeing planes are scheduled to be delivered by The Boeing Co. to American Airlines Inc. between May 2013 and December 2014. Meanwhile, the Boeing 777-323ER aircraft is set to be delivered next month, according to the court filing. American Airlines did not disclose the purchase price for the aircraft in the motion, which it filed under seal to protect confidential information. A court hearing is scheduled for February 26. Objections are due by February 19. About American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: To Pay $1.9-Mil. for Miami Dade Baggage System ----------------------------------------------------------------- AMR Corp. entered into an agreement, which calls for payment by the company of more than $1.9 million on account of Miami-Dade County's claim concerning the Baggage Handling System at the Miami International Airport. The deal was approved by February 6 by Judge Sean Lane of the U.S. Bankruptcy Court in Manhattan. The agreement can be accessed for free at http://is.gd/mSMR0b About American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Committee Seeks to Retain Hay Group ------------------------------------------------------ BankruptcyData reported that AMR Corp.'s official committee of unsecured creditors filed with the U.S. Bankruptcy Court a motion to retain Hay Group (Contact: Irv Becker) as compensation consultant at the following hourly rates: U.S. executive compensation practice leader at $975, other vice president at $930, senior principal at $825, principal at $725, senior consultant at $625, consultant at 525, senior associate at $450, associate at $400 and analyst $350. About American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN APPAREL: Inks 5th Amendment to Crystal Credit Agreement ---------------------------------------------------------------- American Apparel, Inc., and certain of its subsidiaries entered into a Fifth Amendment to the Credit Agreement dated as of March 13, 2012, among the Company and its subsidiaries, with Crystal Financial LLC, as administrative agent, swing line lender and a letter of credit issuer. The Fifth Amendment to the Crystal Credit Agreement, among other things, (i) allows the Company to borrow based on its trademarks and for those loans to remain outstanding until Jan. 1, 2014; (ii) extends the applicability of the existing minimum EBITDA covenant for the remainder of 2013, (iii) adds a minimum excess availability covenant for the period of Dec. 16, 2013, through Feb. 1, 2014, (iv) raises the amount of capital expenditures that the Company was allowed to make in fiscal year 2012 from $17,000,000 to $18,000,000 and (v) provides the consent of the administrative agent and lenders to the Eleventh Amendment to the Lion Credit Agreement. A copy of the 5th Amendment is available for free at http://is.gd/Qh4ISI In connection with the Fifth Amendment to the Crystal Credit Agreement, on Feb. 6, 2013, the Company and certain of its subsidiaries entered into an Eleventh Amendment to the Credit Agreement, dated as of March 13, 2009, among the Company, Lion Capital (Americas) Inc. and Lion/Hollywood L.L.C., the other lenders party thereto, and Wilmington Trust, National Association, as administrative agent and collateral agent. The Eleventh Amendment to the Lion Credit Agreement (i) conforms the minimum EBITDA covenant to the revised minimum EBITDA covenant under the Crystal Credit Agreement, as amended, and (ii) provides the consent of the administrative agent and lenders to the Fifth Amendment to the Crystal Credit Agreement. A copy of the 11th Amendment is available for free at http://is.gd/cYv1Tj About American Apparel Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP) -- http://www.americanapparel.com/-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel. As of September 2010, American Apparel employed over 10,000 people and operated 278 retail stores in 20 countries, including the United States, Canada, Mexico, Brazil, United Kingdom, Ireland, Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea and China. Amid liquidity problems and declining sales, American Apparel in early 2011 reportedly tapped law firm Skadden, Arps, Slate, Meagher & Flom and investment bank Rothschild Inc. for advice on a restructuring. In April 2011, American Apparel said it raised $14.9 million in rescue financing from a group of investors led by Canadian financier Michael Serruya and private equity firm Delavaco Capital Corp., allowing the casual clothing retailer to meet obligations to its lenders for the time being. Under the deal, the investors were buying 15.8 million shares of common stock at 90 cents apiece. The deal allows the investors to purchase additional 27.4 million shares at the same price. The Company reported a net loss of $39.31 million in 2011, and a net loss of $86.31 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $333.64 million in total assets, $319.76 million in total liabilities and $13.87 million in total stockholders' equity. AMWINS GROUP: S&P Assigns 'B' Rating on $715MM 1st-Lien Term Loan ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it has affirmed its 'B' counterparty credit rating on AmWINS Group LLC. The outlook is stable. At the same time, S&P assigned its 'B' issue-level rating to the company's planned $715 million first-lien term loan due September 2019. S&P has assigned this debt a recovery rating of '4', indicating its expectation for an average (30%-50%) recovery for lenders in the event of a payment default. S&P also revised its recovery rating on AmWINS' existing $75 million first-lien revolving credit facility due 2017 to '4', indicating S&P's expectation for an average (30%-50%) recovery for lenders in the event of a payment default, from '2' and lowered its issue ratings on this debt to 'B' from 'B+' in accordance with S&P's notching criteria for recovery ratings. "The rating affirmation reflects our expectation that AmWINS' leverage profile will remain relatively unchanged following the proposed transaction since the company is using proceeds from the proposed issuance to refinance its $693 million in existing first- and second-lien debt, with the remaining $23 million to be used for original issue discount, transaction fees, and a call premium on existing debt," said Standard & Poor's credit analyst Julie Herman. "The company will issue the new first-lien term loan through an amendment to its existing first lien term loan with substantially the same terms and conditions, but better pricing and a maturity extended by three months." The counterparty credit rating on AmWINS reflects the company's limited financial flexibility resulting from its highly leveraged capital structure. The company experiences earnings volatility due to its susceptibility to underwriting, pricing, and economic cycles. It also faces integration and execution risks in its growth-by-acquisition strategy. Offsetting these negative factors is AmWINS' enhanced competitive position following a series of more than 30 opportunistic acquisitions since 2002. In addition to its niche expertise in the excess and surplus market, the company differentiates itself from peers through its increasingly diverse revenue base in its specialty underwriting and group benefits divisions. For 2013, S&P expects AmWINS to maintain its favorable performance trends, with overall organic growth in the positive low- to mid- single digits on continued market share gains from successful sales strategies, as well as improving rates and exposures in its markets. EBITDA should increase to more than $150 million due to continued core earnings growth, the recent acquisition of Gresham & Associates and Specialty Risk Services, and sustained margins of at least 25%. S&P also expects the company to maintain a debt-to- last-12-month adjusted EBITDA of less than 7x and EBITDA fixed- charge coverage of 2x or above. The company should also generate healthy positive cash flows from operations and maintain a cushion of unrestricted cash of at least $15 million. "If AmWINS appears to be underperforming relative to our expectations," Ms. Herman continued, "we will consider lowering the ratings. The ratings will particularly come under pressure if underperformance results from financial management that's more aggressive than expected, loss of market share to competitors, or poor execution regarding management's international expansion strategy. Given the company's highly levered profile following the New Mountain Capital transaction, we don't expect to raise the rating over the next year." ASPEN GROUP: Has 3.1 Million Shares Resale Prospectus ----------------------------------------------------- Aspen Group, Inc., filed with the U.S. Securities and Exchange Commission a Form S-1 registration statement relating to the sale of up to 3,064,289 shares of Aspen Group, Inc., common stock which may be offered by Galt Asset Management, LLC, Timothy Allen, William J. Lipkin, et al. The Company will not receive any proceeds from the sales of shares of its common stock by the selling shareholders. The Company's common stock trades on the Over-the-Counter Bulletin Board under the symbol "ASPU". As of the last trading day before Feb. 11, 2013, the closing price of the Company's common stock was $0.50 per share. A copy of the Form S-1 is available for free at: http://is.gd/HmP2k0 About Aspen Group Denver, Colo.-based Aspen Group, Inc., was founded in Colorado in 1987 as the International School of Information Management. On Sept. 30, 2004, it was acquired by Higher Education Management Group, Inc., and changed its name to Aspen University Inc. On May 13, 2011, the Company formed in Colorado a subsidiary, Aspen University Marketing, LLC, which is currently inactive. On March 13, 2012, the Company was recapitalized in a reverse merger. Aspen's mission is to become an institution of choice for adult learners by offering cost-effective, comprehensive, and relevant online education. Approximately 88% of the Company's degree- seeking students (as of June 30, 2012) were enrolled in graduate degree programs (Master or Doctorate degree program). Since 1993, the Company has been nationally accredited by the Distance Education and Training Council, a national accrediting agency recognized by the U.S. Department of Education. The Company's balance sheet at Sept. 30, 2012, showed $5.34 million in total assets, $4.57 million in total liabilities and $763,228 in total stockholders' equity. "The Company had a net loss allocable to common stockholders of $5,213,755 and negative cash flows from operations of $2,288,416 for the nine months ended September 30, 2012. The Company's ability to continue as a going concern is contingent on securing additional debt or equity financing from outside investors. These matters 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 Sept. 30, 2012. ATP OIL: EPA Initiates Civil Environmental Suit ----------------------------------------------- BankruptcyData reported that the U.S. Environmental Protection Agency filed with the U.S. Bankruptcy Court a notice that it initiated a civil environmental enforcement action against ATP Oil & Gas Corporation and non-debtor entity ATP Infrastructure Partners. The BankruptcyData report related that the complaint addresses ATP Oil & Gas' alleged unlawful discharges of oil and unpermitted chemical dispersants from ATP Innovator (a floating oil and gas production platform) into the Gulf of Mexico. Gavin Broady of BankruptcyLaw360 related that the EPA has alleged that ATP Oil is liable for as much as $55 million in penalties for concealing the discharge of oil into the Gulf of Mexico with covertly injected chemical dispersants. 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. 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. AVIATION ROAD: Case Summary & 6 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Aviation Road Development Corp. dba Carl R's 124 Main Street Queensbury, NY 12804 Bankruptcy Case No.: 13-10316 Chapter 11 Petition Date: February 11, 2013 Court: United States Bankruptcy Court Northern District of New York (Albany) Debtor's Counsel: Justin A. Heller, Esq. NOLAN & HELLER, LLP 39 North Pearl St, 3rd Floor Albany, NY 12207 Tel: (518) 449-3300 E-mail: jheller@nolanandheller.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its six largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/nynb13-10316.pdf The petition was signed by Joseph DeSantis, president. API TECHNOLOGIES: Moody's Withdraws Ratings After Debt Payment -------------------------------------------------------------- Moody's Investors Service has withdrawn all ratings of API Technologies Corp., including its Caa1 Corporate Family Rating and negative outlook due to the repayment of all rated debt. The following ratings and outlook were withdrawn: Corporate Family Rating, previously rated Caa1 Probability of Default Rating, previously rated Caa1-PD Speculative Grade Liquidity Rating, previously rated SGL-4 $15 million first lien revolver due 2014, previously rated Caa1 (LGD-3, 49%) $186 million first lien term loan due 2016, previously rated Caa1 (LGD-3, 49%) Outlook, Changed To Rating Withdrawn From Negative Ratings Rationale: On February 6, 2013, API Technologies Corp. completed a refinancing of its previously outstanding rated bank debt. All ratings of API have been withdrawn since the company has no rated debt outstanding. API Technologies Corp. designs, develops and manufactures electronic systems, subsystems, RF and secure solutions for technically demanding defense, aerospace and commercial applications. Revenues for the twelve months ended November 30, 2012 totaled $281 million. ARCAPITA BANK: Chapter 11 Plan Contemplates $185-Mil. Loan ---------------------------------------------------------- Arcapita Bank B.S.C.(c), et al., filed with the Bankruptcy Court on Feb. 8, 2013, a disclosure statement in support of their Joint Plan of Reorganization, dated Feb. 8, 2013. The Plan contemplates, among others, the entry of the Debtors into a $185 million Murabaha exit facility that will allow the Debtors to wind down their businesses and assets for the benefit of all creditors and stakeholders. The Plan proposes to establish new Cayman Islands and Delaware holding companies which will own, directly or indirectly, 100% of the Debtors' assets. In exchange for their claims, the majority of the Debtors' unsecured creditors will receive a Pro Rata Share of a new Shari'ah compliant Sukuk Facility, substantially all of the equity of the New Holding Companies and certain warrants issued by New Arcapita Topco. The Reorganized Arcapita Group will wind down its operations and will not seek out new investors or investments. All proceeds allocable to the Reorganized Arcapita Group resulting from exited portfolio assets, except for any working capital cash needs of the Reorganized Arcapita Group, will be used to repay the New Murabaha Facilities (the "New SCB Facility and the Exit Facility") and the Sukuk Facility, in accordance with their terms, and to make distributions in respect of the equity of the Reorganized Arcapita Group. Super-Subordinated Claims in Classes 10(a) and 10(g) are impaired and, because they receive no distribution under the Plan, Holders of such Classes are deemed to have rejected the Plan and are not entitled to vote on the Plan. Holders of Interests in Arcapita Bank B.S.C.(c) in Class 9(a) are Unimpaired by the Plan, except as provided in Section 4.9.2, and are presumed to accept the Plan. Holders of Interests in Class 9(a) are not entitled to vote on the Plan. SCB Claims in Class 2(a)-(f), Syndicated Facility Claims and Arcsukuk Claims in Class 4(a)-(b), General Unsecured Claims Against Arcapita in Class 5(a), General Unsecured Claims Against AIHL in Class 5(b), General Unsecured Claims Against Falcon in Class 5(g), Convenience Claims in Class 6(a), Intercompany Claims Against Arcapita and AIHL in Class 7(a)-(b), Intercompany Claims in Falcon in Class 7(g), Subordinated Claims Against Arcapita in Class 8(a), Subordinated Claims Against Falcon in Class 8(g) and Interests in Falcon in Class 9(g) are Impaired by and entitled to receive a distribution under the Plan, and only the Holders of Claims or Interests in those Classes are entitled to vote to accept or reject the Plan. Other Priority Claims in Class 1(a)-(g), Other Secured Claims in Class 3(a)-(g), General Unsecured Claims Against Debtors Other than Aracpita and AIHL and Falcon in Class 5(c)-(f), Intercompany Claims Against Debtors Other Than Arcapita and AIHL and Falcon in Class 7(c)-(f) and Intercompany Claims Against Falcon in Class 9(b)-(f) are Unimpaired by the Plan, and the Holders of Claims in such Classes are conclusively presumed to have accepted the Plan. The definitive documents evidencing the Exit Facility will be filed in the Plan Supplement. A copy of the Disclosure Statement in respect of the Debtors' Joint Plan of Reorganization is available at: http://bankrupt.com/misc/arcapita.doc827.pdf 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. ARCHDIOCESE OF MILWAUKEE: Claimants Want Insurance Taken Up First ----------------------------------------------------------------- Certain claimants ask the U.S. Bankruptcy Court for the Eastern District of Wisconsin to enter an order to sequence the bankruptcy case of the Archdiocese of Milwaukee to advance the insurance dispute before any further claims objection. In a memorandum filed in support of the request, Michael G. Finnegan, Esq., at Jeff Anderson & Associates, P.A., in St. Paul, Minnesota, asserts that there are numerous reasons why the request should be granted. He contends that further claims objection litigation will risk a huge cost to abuse survivors -- further depression and possible suicide to name a few. Mr. Finnegan also asserts that the request to sequence will save judicial resources. He argues the claims objections may not even be necessary if there are no assets in the bankruptcy estate. Moreover, he notes that sequencing will not prejudice the parties as all defenses will be preserved. The Claimants seek the same procedure that One Beacon (Commercial Union) sought and received in state court -- a determination of insurance coverage first, Mr. Finnegan further contends. Hence, the Claimants request that the Court sequence matters so that the insurance dispute advances before any further claims objection litigation. Meanwhile, another group of claimants represented by Robert Elliot, Esq., expressed support for court approval of the request. The names of the claimants were withheld and were only referred to in court papers as Claimants A-179, A-180, A-181 and A-182. About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARCHDIOCESE OF MILWAUKEE: Sex Abuse Claims Go to Trial ------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Wisconsin denied the motions for summary judgment filed by the Archdiocese of Milwaukee in connection with its objections to three sex abuse claims. The Archdiocese of Milwaukee previously proposed that the claims, assigned as Claim Nos. 106, 259 and 456, should be disallowed "as time-barred under Wisconsin's statute of limitations." The claimants, whose names were withheld and were only referred to in court filings as A-36, A-156 and A-341, alleged that they were sexually abused by clergy in the Archdiocese of Milwaukee. Meanwhile, the bankruptcy court granted the motion for summary judgment on Claim No. 89 filed by Roy Ebert, an alleged sex abuse victim. Mr. Ebert filed the claim in 2011, alleging that George Nuedling sexually molested him when he was an altar boy and fourth grade student at St. Lawrence Catholic School in Milwaukee. The Archdiocese of Milwaukee had proposed the disallowance of Mr. Ebert's claim, saying it is unenforceable against the archdiocese under Wisconsin's six-year statute of limitations for fraud. The claimant responded that "equitable estoppel" bars the archdiocese from raising the statute of limitations. Separately, the Archdiocese of Milwaukee filed a proposal concerning the schedule for the bankruptcy court's consideration of its objections to various claims. The proposal can be accessed for free at http://is.gd/aTXhKz About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARCHDIOCESE OF MILWAUKEE: Late-Filed Sex Abuse Claim Disallowed --------------------------------------------------------------- Bankruptcy Judge Susan V. Kelley sustained the objection filed by the Archdiocese of Milwaukee to Proof of Claim number 89 filed by Roy Ebert for alleged sexual abuse. Judge Kelley sided with the Debtor, which sought summary judgment, arguing that the Claim should be disallowed as time-barred under Wisconsin's statute of limitations. Mr. Ebert filed his claim on Sept. 15, 2011. He alleged that Father George Nuedling sexually assaulted him in 1963 when the Claimant was an altar boy and fourth grade student at St. Lawrence Catholic School in Milwaukee. In support of its summary judgment motion, the Debtor filed an affidavit of Attorney Francis LoCoco and appended copies of correspondence from the Claimant and his attorney to the Debtor. The Claimant sent an e-mail on April 28, 2002, in which he stated that it was "well known among the boys, even in the church rectory, not to stand with your back to this priest. . . ." The e-mail describes Nuedling's violent attack on the Claimant in the school restroom and asks: "I just wonder how many other little boys this evil man harmed?" Barbara Reinke, director of the Debtor's Project Benjamin, responded to the Claimant's e-mail and confirmed that Nuedling was known to the Debtor as an offender, and was confronted before his death. On Jan. 17, 2003, Mr. Ebert's attorney, Daniel Stevens, wrote a letter to Barbara Reinke. The letter states that it is well- known that Nuedling assaulted children since the 1960s for over 30 years. The letter accuses the Debtor of responding to the reports of abuse by reassigning Nuedling to another parish, "exposing innocent victims to a monster." The letter concludes: "I would appreciate a response from you within 10 days from the date of this letter, or I will advise Mr. Ebert to pursue other avenues." On Feb. 5, 2003, the Debtor's attorney, Matthew Flynn, responded: "The Archdiocese appreciates your reporting the matters set out in your letter. However you seem to imply that the Archdiocese knew in the 1960s that Fr. Nuedling was engaged in this kind of conduct. In fact, the Archdiocese did not have knowledge of these kinds of allegations against Fr. Nuedling at that time." The response also invited Attorney Stevens to contact Attorney Flynn "about what you are requesting for Mr. Ebert," and asserted that "any litigation claims that you may be implying would be barred by the statute of limitations." Attorney Flynn cited two Wisconsin Supreme Court decisions as authority for his statement about the statute of limitations. The Debtor urges disallowance of the Claim under 11 U.S.C. Sec. 502(b)(1) because the Claim is "unenforceable against the debtor . . . under any agreement or applicable law." The applicable law is Wisconsin's six-year statute of limitations for fraud. The Claimant responds that equitable estoppel bars the Debtor from raising the statute of limitations. According to Judge Kelley, "The Court feels a deep sympathy for the abuse suffered by the Claimant and the adverse consequences he has endured through no fault of his own. But, under Wisconsin law, the Court must enforce the statute of limitations if the Claimant had enough information brought home to him about the Debtor's fraud that would lead a reasonable person to investigate. "Here, the Claimant's suspicions about the Debtor's conduct in covering up and transferring Nuedling led the Claimant's attorney to demand immediate answers from the Debtor or he would 'explore other avenues.' Unlike other claimants in this case who filed affidavits stating that they did not know about the Debtor's alleged fraud until recently, the record shows that the Claimant suspected in 2003 at the latest that the Debtor covered up Nuedling's atrocious activities. Under these circumstances, the six-year statute of limitations for the Claimant's fraud claim expired prior to the Debtor's bankruptcy petition." A copy of Judge Kelley's Jan. 31, 2013 Memorandum Decision is available at http://is.gd/wevgFBfrom Leagle.com. About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) BAKERS FOOTWEAR: Seeks to Auction Intellectual Property ------------------------------------------------------- Marie Beaudette at Dow Jones' DBR Small Cap reports that the trustee winding down Bakers Footwear Group Inc. is seeking court approval to sell the liquidating retailer's intellectual property and some store leases to Zigi USA for $2.45 million, subject to higher offers at auction. About Bakers Footwear Bakers Footwear Group Inc., a mall-based retailer of shoes for young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a plan to close stores and reduce costs. Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc., later renamed Weiss and Neuman Shoe Co., a regional chain of footwear stores. In 1997, Bakers was acquired principally by its current chief executive officer, Peter Edison, who had previously served in various senior management positions at Edison Brothers Stores Inc. In June 1999, Bakers purchased selected assets of the "Bakers" and "Wild Pair" footwear retailing chains from the bankruptcy estate of Edison Brothers. The "Bakers" footwear retailing chain was founded in 1924 and is the third-oldest soft goods retail concept still in operation in the United States. In February 2001, the Debtor changed its name to Bakers Footwear Group, Inc. In February 2004, Bakers conducted an initial public offering of its common stock. Bakers' common stock is quoted under the ticker symbol "BKRS" on the, the OTC Markets Group's quotation platform. As of the Petition Date, Bakers operates roughly 215 stores nationwide. In November 2012, the U.S. Bankruptcy Court in St. Louis authorized the company to hire a joint venture between SB Capital Group LLC and Tiger Capital Group LLC as agents to conduct closing sales for 150 stores. Bankruptcy Judge Charles E. Rendlen III presides over the case. Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel. Alliance Management serves as financial and restructuring advisors. Donlin, Recano & Company, Inc., serves as claims agent. The petition was signed by Peter A. Edison, chief executive officer and president. The Company's balance sheet at April 28, 2012, showed $41.90 million in total assets, $59.49 million in total liabilities and a $17.59 million total shareholders' deficit. Counsel for Crystal Financial, the DIP Lender, are Donald E. Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade, Esq., at Spencer, Fane, Britt & Brown, LLP. Bradford Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Official Committee of Unsecured Creditors. BBX CAPITAL: Dimensional Fund Discloses 3.8% Equity Stake --------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 596,378 shares of common stock of BBX Captial Corp. representing 3.83% of the shares outstanding. Dimensional Fund previously reported beneficial ownership of 639,851 common shares or a 4.15% equity stake as of Dec. 31, 2011. A copy of the amended filing is available at: http://is.gd/f4Su4U About BankAtlantic Bancorp BankAtlantic Bancorp (NYSE: BBX) -- http://www.BankAtlanticBancorp.com/-- is a bank holding company and the parent company of BankAtlantic. BankAtlantic -- "Florida's Most Convenient Bank" with a Web presence at http://www.BankAtlantic.com/-- has nearly $6.0 billion in assets and more than 100 stores, and is one of the largest financial institutions headquartered junior in Florida. BankAtlantic has been serving communities throughout Florida since 1952 and currently operates more than 250 conveniently located ATMs. BankAtlantic reported a net loss of $28.74 million in 2011, a net loss of $143.25 million in 2010, and a net loss of $185.82 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $488.35 million in total assets, $233.62 million in total liabilities and $254.72 million in total stockholders' equity. * * * As reported by the TCR on March 1, 2011, Fitch has affirmed its current Issuer Default Ratings for BankAtlantic Bancorp and its main subsidiary, BankAtlantic FSB at 'CC'/'C' following the announcement regarding the regulatory order with the Office of Thrift Supervision. BankAtlantic has announced that it has entered into a Cease and Desist Order with the OTS at both the bank and holding company level. The regulatory order includes increased regulatory capital requirements, limits to the size of the balance sheet, no new commercial real estate lending and improvements to its credit risk and administration areas. Further, the holding company must also submit a capital plan to maintain and enhance its capital position. BEHRINGER HARVARD: Completes Liquidation of Assets Under Plan ------------------------------------------------------------- Behringer Harvard Short-Term Opportunity Fund I LP, on Feb. 11, 2013, completed its liquidation pursuant to a Plan of Liquidation adopted by its general partner, which provided for the formation of a liquidating trust for the purpose of completing the liquidation of the assets of the Partnership followed by a dissolution of the Partnership. In furtherance of the Plan, the Partnership entered into a Liquidating Trust Agreement with Behringer Harvard Advisors II LP, the general partner of the Partnership, as managing trustee, and CSC Trust Company of Delaware, as resident trustee, in connection with the formation of the Behringer Harvard Short-Term Opportunity Liquidating Trust. As of the Effective Date, each of the holders of limited partnership units in the Partnership received a pro rata beneficial interest in the Liquidating Trust in exchange for that holder's interest in the Partnership. In accordance with the Plan and the Liquidating Trust Agreement, the Partnership has transferred all of its remaining assets and liabilities to the Liquidating Trust to be administered, disposed of or provided for in accordance with the terms and conditions set forth in the Liquidating Trust Agreement. The purpose of the Liquidating Trust is to wind up the Partnership's affairs and liquidate the Partnership's assets, including, but not limited to, the sale of its remaining real estate assets, to make appropriate provision for the Partnership's remaining obligations and to make special distributions to the investors of available liquidation proceeds. Pursuant to the Liquidating Trust Agreement, the Managing Trustee is entitled to receive the same compensation and expense reimbursements that the general partner of the Partnership was entitled to receive. The existence of the Liquidating Trust will terminate upon the earliest of (i) the distribution of all of the Liquidating Trust's assets in accordance with the terms of the Liquidating Trust Agreement, or (ii) the expiration of a period of three years from the Effective Date. The existence of the Liquidating Trust may, however, be extended beyond the three year term if the Managing Trustee determines that an extension is reasonably necessary to wind up the affairs of this Liquidating Trust. On the Effective Date, the Partnership filed a Form 15 with the Securities and Exchange Commission to terminate the registration of the limited partnership units in the Partnership under the Securities Exchange Act of 1934. Accordingly, the Partnership will cease filing reports under that act. However, the Managing Trustee will cause the Liquidating Trust to file with the Securities and Exchange Commission annual reports on Form 10-K showing the assets and liabilities of the Liquidating Trust at the end of each calendar year and describing the changes in the assets and liabilities of the Liquidating Trust and the actions taken by the Managing Trustee during the period. The Managing Trustee will also cause the Liquidating Trust to file current reports on Form 8-K whenever an event occurs for which Form 8-K requires that report to be filed for the Liquidating Trust or to disclose material events relating to the Liquidating Trust or its assets. A copy of the Plan of Liquidation is available at: http://is.gd/cSMSKd A copy of the Liquidating Trust Agreement is available at: http://is.gd/MRYYNL About Behringer Harvard Addison, Tex.-based Behringer Harvard is a limited partnership formed in Texas on July 30, 2002. The Company's general partners are Behringer Harvard Advisors II LP and Robert M. Behringer. As of Sept. 30, 2011, seven of the twelve properties the Company acquired remain in the Company's portfolio. The Company's Agreement of Limited Partnership, as amended, provides that the Company will continue in existence until the earlier of Dec. 31, 2017, or termination of the Partnership pursuant to the dissolution and termination provisions of the Partnership Agreement. For the year ended Dec. 31 2011, Deloitte & Touche LLP, in Dallas, Texas, noted that the uncertainty surrounding the ultimate outcome of settling unpaid debt and its effect on the Partnership, as well as the Partnership's operating losses at its subsidiaries, raise substantial doubt about its ability to continue as a going concern. The Partnership is facing a significant amount of debt maturities in the near future and debt which has matured but remains unpaid, which is recourse to the Partnership. Behringer reported a net loss of $50.15 million in 2011, a net loss of $18.71 million in 2010, and a net loss of $15.47 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $49.06 million in total assets, $52.94 million in total liabilities and a $3.88 million total deficit. BERNARD L. MADOFF: Trustee Proposes Third Distribution ------------------------------------------------------ Irving H. Picard, the Securities Investor Protection Act (SIPA) Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS) filed a motion on Feb. 13 in the United States Bankruptcy Court for the Southern District of New York seeking approval for an allocation of recoveries to the BLMIS Customer Fund and an authorization for a third pro rata interim distribution from the Customer Fund to BLMIS customers with allowed claims. The third interim distribution will total approximately $505 million, and will bring the amount distributed to eligible claimants to $5.438 billion, which includes $806.7 million in advances committed to the SIPA Trustee for distribution to allowed claimants by the Securities Investor Protection Corporation (SIPC). "Returning the maximum amount of funds stolen in the Madoff Ponzi scheme to their rightful owners remains our mission, and the third interim distribution of recovered money signals ongoing momentum in our efforts and also shines a light on the important role played by SIPC in making ongoing recoveries and distributions possible," said Mr. Picard. "We will continue working diligently to remove impediments that block the speedy return of recovered funds to BLMIS customers and to increase Customer Fund recoveries for further distributions as soon as is practicable." SIPC President Steve Harbeck said, "We are very pleased that Trustee Picard, working through the customer protection program set up by Congress, is returning more than $5 billion to Madoff victims, with more than half of the claimants with allowed claims achieving full recovery. This is the hallmark of an established and tested process that delivers for American investors, even in a case as complicated as the Madoff liquidation proceeding. The Madoff liquidation is emerging as a textbook example of how SIPC works . . . and works well . . . for American investors." Allowed claims will receive approximately 4.709 percent of the allowed claim amount of each individual account, unless the claim is fully satisfied. Currently, 2,178 accounts have an allowed claim and, of these accounts, 1,106 will be fully satisfied following the third interim distribution. The average payment for an allowed claim issued in the third distribution will total approximately $458,000 and the largest will be approximately $115 million. The third interim distribution will be paid to record holders of allowed claims as of March 22, 2013. The SIPA Trustee has recovered or reached agreements to recover more than $9.317 billion since his appointment in December 2008. These recoveries exceed similar efforts related to prior Ponzi scheme recoveries, in terms of dollar value and percentage of stolen funds recovered. Ultimately, 100 percent of the SIPA Trustee's recoveries will be allocated to the Customer Fund for distribution to BLMIS customers with allowed claims. As of February 12, 2013, the SIPA Trustee has distributed by the second pro rata interim distribution approximately $3.626 billion to BLMIS accounts with allowed claims and approximately $499.8 million has been returned via the first pro rata interim distribution. In addition, SIPC has paid a maximum advance of up to $500,000 against each allowed BLMIS claim, and to date, SIPC has committed approximately $806.7 million in advances to these customers. All administrative costs of the SIPA liquidation of Bernard L. Madoff Investment Securities LLC and its global recovery efforts making possible the distributions to BLMIS customers with allowed claims have been funded through monies advanced to the SIPA Trustee by SIPC. On February 8, 2013, the 90-day escrow period ended for the $1.025 billion settlement between the SIPA Trustee and more than a dozen domestic and foreign investment funds, their affiliates and a former chief executive associated with Tremont Group Holdings, Inc., and the settlement funds plus interest were released to the SIPA Trustee. Accordingly, the SIPA Trustee has allowed certain customer claims related to Tremont. The proposed allocation totals approximately $1.198 billion, drawn primarily from the Tremont funds and including funds recovered by the SIPA Trustee since the second interim distribution. "Our efforts to recover additional stolen funds are far from over, and we will continue to vigorously pursue pending cases and issues, as we remain confident in our positions," said David J. Sheehan, Chief Counsel to the SIPA Trustee. Mr. Sheehan noted that there are 173 claims still subject to litigation. Once litigation is resolved, each individual claim may become allowed and would become eligible for all pro rata distributions to date. For this potential scenario, the SIPA Trustee has, to date, reserved approximately $2.476 billion. The ultimate amount of additional allowed claims depends on the outcome of the litigation, and could add more than $6.5 billion to the total amount of allowed claims. Additionally, more than 1,200 objections have been filed relating to the time-based damages issue, seeking additional payments based on the New York state statutory pre-judgment interest rate of 9 percent, inflation, or other damages calculations. Until a final, unappealable order is reached on the issue of time-based damages, the SIPA Trustee must hold a court-ordered reserve of approximately $1.3 billion. Portions of recoveries and settlement agreements have not yet been collected, due to appeals, the timing of payments of certain settlement monies and other issues. Therefore, these funds cannot be either allocated to the Customer Fund or distributed to BLMIS customers with allowed claims until these issues are resolved. Required reserves include the $220 million settlement with the Norman F. Levy family, which is still subject to appeal until late March 2013 and, as a result, these funds remain in reserve. Also, approximately $222.8 million relating to settlement reserves and other matters must be held in reserve. A hearing on the third allocation and distribution motion has been set for March 13, 2013. The Customer Fund Allocation and Distribution Motion can be found on the United States Bankruptcy Court's Web site at http://www.nysb.uscourts.gov/ Bankr. S.D.N.Y., No. 08-01789 (BRL). About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.) The SIPA Trustee has said that as of March 31, 2012, through prepetition litigation and other settlements, he has successfully recovered, or reached agreements to recover, more than $9 billion -- over 50% of the principal lost in the Ponzi scheme by those who filed claims -- for the benefit of all customers of BLMIS. The liquidation has so far has cost the Securities Investor Protection Corp. $1.3 billion, including $791 million to pay a portion of customers' claims. Mr. Picard has so far made only one distribution in October of $325 million for 1,232 customer accounts. Uncertainty created by various appeals has limited Mr. Picard's ability to distribute recovered funds. BERRY PLASTICS: Graham Berry Discloses 5.4% Equity Stake -------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Graham Berry Holdings, LP, Graham Berry Holdings GP, LLC, and Graham Partners II, L.P., disclosed that, as of Oct. 4, 2012, they beneficially own 6,125,000 shares of common stock of Berry Plastics Group, Inc., representing 5.4% of the shares outstanding. A copy of the filing is available for free at: http://is.gd/q33CUG About Berry Plastics Berry Plastics Corporation manufactures and markets plastic packaging products, plastic film products, specialty adhesives and coated products. At Jan. 2, 2010, the Company had more than 80 production and manufacturing facilities, primarily located in the United States. Berry is a wholly-owned subsidiary of Berry Plastics Group, Inc. Berry Group is primarily owned by affiliates of Apollo Management, L.P., and Graham Partners. Berry, through its wholly owned subsidiaries operates five reporting segments: Rigid Open Top, Rigid Closed Top, Flexible Films, Tapes/Coatings and Specialty Films. The Company's customers are located principally throughout the United States, without significant concentration in any one region or with any one customer. On Dec. 3, 2009, Berry Plastics obtained control of 100% of the capital stock of Pliant upon Pliant's emergence from reorganization pursuant to a proceeding under Chapter 11 for a purchase price of $602.7 million. Pliant is a leading manufacturer of value-added films and flexible packaging for food, personal care, medical, agricultural and industrial applications. The acquired business is primarily operated in Berry's Specialty Films reporting segment. The Company's balance sheet at Dec. 29, 2012, showed $5.05 billion in total assets, $5.36 billion in total liabilities and a $313 million total stockholders' deficit. * * * As reported by the TCR on Feb. 1, 2013, Moody's Investors Service upgraded the corporate family rating of Berry Plastics to B2 from B3 and the probability of default rating to B2-PD from B3-PD. The upgrade of the corporate family rating to B2 from B3 reflects the improvement in pro-forma credit metrics and management's publicly stated goal to pursue a less aggressive, more balanced financial profile. In November 2011, Standard & Poor's Ratings Services affirmed the 'B-' corporate credit rating on Berry and its holding company parent, Berry Plastics Group Inc. "The ratings on Berry reflect the risks associated with the company's highly leveraged financial profile and acquisition- driven growth strategy as well as its fair business risk profile," said Standard & Poor's credit analyst Cynthia Werneth. In November 2011, Standard & Poor's Ratings Services affirmed the 'B-' corporate credit rating on Berry and its holding company parent, Berry Plastics Group Inc. "The ratings on Berry reflect the risks associated with the company's highly leveraged financial profile and acquisition- driven growth strategy as well as its fair business risk profile," said Standard & Poor's credit analyst Cynthia Werneth. BERRY PLASTICS: Borrows Add'l $1.4 Billion From Credit Suisse ------------------------------------------------------------- Berry Plastics Group, Inc., Berry Plastics Corporation and certain of its subsidiaries entered into an Incremental Assumption Agreement with Credit Suisse AG, Cayman Islands Branch, to increase the commitments under Berry's existing term loan credit agreement by $1,400,000,000. Berry borrowed loans in an aggregate principal amount equal to the full amount of the commitments on Feb. 8, 2013. The Term D Loans bear interest at LIBOR plus 2.50% per annum with a LIBOR floor of 1.00%, mature on Feb. 8, 2020, and are subject to customary amortization. If certain specified repricing events occur prior to Feb. 8, 2014, Berry will pay a fee to the applicable lenders equal to 1.00% of the outstanding principal amount of the Term D Loans subject to that repricing event. The proceeds of the Term D Loans, in addition to borrowings under Berry's revolving credit facility, were used to (a) satisfy and discharge all of Berry's outstanding (i) Second Priority Senior Secured Floating Rate Notes due 2014, (ii) First Priority Senior Secured Floating Rate Notes due 2015, (iii) 10 1/4% Senior Subordinated Notes due 2016 and (iv) 8 1/4% First Priority Senior Secured Notes due 2015, which, in each case, were called for redemption on Feb. 8, 2013, and the related indentures and (b) pay related fees and expenses. About Berry Plastics Berry Plastics Corporation manufactures and markets plastic packaging products, plastic film products, specialty adhesives and coated products. At Jan. 2, 2010, the Company had more than 80 production and manufacturing facilities, primarily located in the United States. Berry is a wholly-owned subsidiary of Berry Plastics Group, Inc. Berry Group is primarily owned by affiliates of Apollo Management, L.P., and Graham Partners. Berry, through its wholly owned subsidiaries operates five reporting segments: Rigid Open Top, Rigid Closed Top, Flexible Films, Tapes/Coatings and Specialty Films. The Company's customers are located principally throughout the United States, without significant concentration in any one region or with any one customer. On Dec. 3, 2009, Berry Plastics obtained control of 100% of the capital stock of Pliant upon Pliant's emergence from reorganization pursuant to a proceeding under Chapter 11 for a purchase price of $602.7 million. Pliant is a leading manufacturer of value-added films and flexible packaging for food, personal care, medical, agricultural and industrial applications. The acquired business is primarily operated in Berry's Specialty Films reporting segment. The Company's balance sheet at Dec. 29, 2012, showed $5.05 billion in total assets, $5.36 billion in total liabilities and a $313 million total stockholders' deficit. * * * As reported by the TCR on Feb. 1, 2013, Moody's Investors Service upgraded the corporate family rating of Berry Plastics to B2 from B3 and the probability of default rating to B2-PD from B3-PD. The upgrade of the corporate family rating to B2 from B3 reflects the improvement in pro-forma credit metrics and management's publicly stated goal to pursue a less aggressive, more balanced financial profile. In November 2011, Standard & Poor's Ratings Services affirmed the 'B-' corporate credit rating on Berry and its holding company parent, Berry Plastics Group Inc. "The ratings on Berry reflect the risks associated with the company's highly leveraged financial profile and acquisition- driven growth strategy as well as its fair business risk profile," said Standard & Poor's credit analyst Cynthia Werneth. In November 2011, Standard & Poor's Ratings Services affirmed the 'B-' corporate credit rating on Berry and its holding company parent, Berry Plastics Group Inc. "The ratings on Berry reflect the risks associated with the company's highly leveraged financial profile and acquisition- driven growth strategy as well as its fair business risk profile," said Standard & Poor's credit analyst Cynthia Werneth. BOB COOK: Maloofs Give Ch. 11 Trustee Sacramento Kings Sale Docs ---------------------------------------------------------------- Dale Kasler, writing for The Sacramento Bee, reported that pushing his claim that the Sacramento Kings' limited partners might have a right to match a Seattle group's purchase offer for the team, a bankruptcy trustee has persuaded the Maloofs to cough up confidential documents on the pending sale. The report said following lengthy negotiations, the Maloofs turned over documents last Friday concerning the sale of their 65 percent share of the team, trustee David Flemmer's lawyer told a bankruptcy judge Monday. Flemmer's lawyer, Don Fitzgerald, said an "outline" of the Seattle deal will be made available on a confidential basis to qualified bidders interested in buying bankrupt limited partner Bob Cook's 7 percent share, according to the report. The Sacramento Bee noted that Flemmer is auctioning the share to pay Cook's creditors. The Cook auction has become a potentially major issue in the fight between Sacramento and Seattle for the Kings, the report said. BON-TON STORES: Lombard Odier Discloses 9.4% Equity Stake --------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Lombard Odier Asset Management (USA) Corp disclosed that, as of Dec. 31, 2012, it beneficially owns 1,619,394 shares of common stock of The Bon-Ton Stores, Inc., representing 9.44% of the shares outstanding. A copy of the filing is available for free at http://is.gd/ZysGJT 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. BLUEGREEN CORP: Dimensional Fund Discloses 8.5% Equity Stake ------------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 2,702,700 shares of common stock of Bluegreen Corp. representing 8.56% of the shares outstanding. Dimensional Fund previously reported beneficial ownership of 2,704,394 common shares or a 8.3% equity stake as of Dec. 31, 2011. A copy of the amended filing is available at: http://is.gd/wYTNZz 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'. BRIER CREEK: Court Sends BofA Dispute to Arbitration ---------------------------------------------------- Bankruptcy Judge Stephani W. Humrickhouse denied the request of Bank of America, N.A., for the Court to abstain from hearing a lawsuit commenced by Brier Creek Corporate Center Associates Limited Partnership and its affiliated entities. BofA, however, convinced the Court to compel the parties to arbitration with respect to certain of the claims raised in the lawsuit. "The court commends the parties to seek resolution of that issue on their own, with an eye toward efficiencies and fairness, but the court will, of course, be available to direct that determination if necessary, upon proper motion," said Judge Humrickhouse. Brier Creek Corporate Center Associates Limited Partnership, along with eight other related entities filed Chapter 11 petitions last year. Prior to the filing of the petitions, the debtors, along with five other entities, filed a complaint against BofA in Mecklenburg County Superior Court on Oct. 13, 2011. Brier Creek et al. have a loan portfolio in excess of $100 million with BofA, secured by commercial real property located in Mecklenburg and Wake Counties. The complaint contains 15 causes of action including contract and tort claims, arising from Brier Creek et al.'s loans and other financial transactions with BofA. In response, BofA filed counterclaims alleging breaches of contract. The case was subsequently transferred for adjudication to the North Carolina Business Court, although venue remained in Mecklenburg County Superior Court. On May 7, 2012, the state court action was removed to the U.S. Bankruptcy Court for the Western District of North Carolina, and on June 19, 2012, the adversary proceeding was initiated upon the transfer of the case to the U.S. Bankruptcy Court for the Eastern District of North Carolina. The case is styled as, BRIER CREEK CORPORATE CENTER ASSOCIATES LIMITED PARTNERSHIP, AAC RETAIL PROPERTY DEVELOPMENT AND ACQUISITION FUND, LLC, BRIER CREEK OFFICE #4, LLC, BRIER CREEK OFFICE #6, LLC, CARY CREEK LIMITED PARTNERSHIP, SERVICE RETAIL AT BRIER CREEK, LLC, SERVICE RETAIL AT WHITEHALL II LIMITED PARTNERSHIP, SHOPTON RIDGE BUSINESS PARK LIMITED PARTNERSHIP, SHOPTON RIDGE 30-C, LLC, WHITEHALL CORPORATE CENTER #5, LLC, WHITEHALL CORPORATE CENTER #6, LLC, AMERICAN ASSET CORPORATION COMPANIES, LTD., WHITEHALL CORPORATE CENTER #4, LLC Plaintiffs, v. BANK OF AMERICA, N.A. Defendant, Adv. Proc. No. 12-00121-8-SWH-AP (Bankr. E.D.N.C.). A copy of the Court's Feb. 8, 2013 Order is available at http://is.gd/kYFXaPfrom Leagle.com. About Brier Creek Corporate Brier Creek Corporate Center Associates Limited and eight other related entities affiliates filed for Chapter 11 protection (Bankr. E.D.N.C. Lead Case No. 12-01855) on March 9, 2012. The Debtors own real property located in Wake County, North Carolina and Mecklenburg County, North Carolina. In most instances, the real property owned by the Debtors consists of land upon which is constructed commercial or industrial buildings consisting of office, service or retail space. The other debtors are Brier Creek Office #4, LLC; Brier Creek Office #6, LLC; Service Retail at Brier Creek, LLC; Service Retail at Whitehall II Limited Partnership; Shopton Ridge 30-C, LLC; Whitehall Corporate Center #4, LLC; Whitehall Corporate Center #5, LLC; and Whitehall Corporate Center #6, LLC. Brier Creek is a 106-acre development that is to have 2.8 million square feet of commercial space. Whitehall has 146 acres and will have 4 million square feet on completion. Brier Creek Corporate scheduled assets of $19,713,147 and liabilities of $18,086,183. Judge Stephani W. Humrickhouse oversees the case. Northen Blue, LLP, serves as counsel to the Debtors. C. Richard Rayburn, Jr. and the firm Rayburn Cooper & Durham, P.A., serve as special counsel. Grant Thornton LLP is the accountant. Bidencope & Associates was hired as appraiser. The petitions were signed by Terry Bradshaw, vice president. Brier Creek's other affiliated entities are Cary Creek Limited Partnership; Shopton Ridge Business Park Limited Partnership; AAC Retail Property Development and Acquisition Fund, LLC; American Asset Corporation Companies Limited; and American Asset Corporation. Cary Creek Limited Partnership filed a voluntary petition on Jan. 3, 2013. By order entered Jan. 10, 2013, the bankruptcy case of Cary Creek Limited Partnership was consolidated with the other debtors's cases and all of the cases are now being jointly administered for procedural purposes only. CALUMET SPECIALTY: New Refinery JV No Impact on Moody's 'B2' CFR ---------------------------------------------------------------- Moody's Investors Service said that Calumet Specialty Products Partners, L.P.'s (B2 positive) 50%/50% joint venture deal with MDU Resources Group, Inc. (unrated), to build a new 20,000 barrels per day refinery in North Dakota is credit neutral for Calumet. The JV will have only a minor impact on consolidated cash flow, liquidity, and financial leverage ratios. The following summarizes the ratings: Calumet Specialty Products Partners, L.P. Corporate Family Rating -- B2 Probability of Default Rating -- B2-PD Senior Secured Notes Rating -- B3 (LGD5, 71%) Speculative Grade Liquidity Rating -- SGL-3 Outlook - Positive CAMP INTERNATIONAL: S&P Assigns 'B' Rating to $370MM 1st-Lien Loan ------------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its 'B' issue rating to CAMP International Holding Co.'s (CAMP) $370 million first-lien term loan, with a recovery rating of '4'. At the same time, S&P affirmed its 'B' corporate credit rating on the company. S&P also affirmed the 'B' rating on the company's existing $30 million revolving credit facility and revised S&P's recovery rating on the debt to '4' from '3', which reflects the increase in the first-lien debt amount. The recovery rating of '4' indicates S&P's expectation for an average (30% to 50%) recovery of principal in the event of payment default. "The ratings on CAMP reflect the company's weak business profile, characterized by its narrow addressable market and its highly leveraged financial profile," said Standard & Poor's credit analyst Katarzyna Nolan. The company's leading market position, good operating margins, and exclusive agreements with original equipment manufacturers (OEMs) partly offset these factors. The outlook is stable, reflecting S&P's view that the company's recurring and predictable revenue base should result in moderate free cash flow generation. S&P could lower the rating if the company's revenue and EBITDA decline due to a loss of a major OEM contract or cyclical end- market dynamics and as a result, leverage increases to the high-7x area on a sustained basis. An upgrade is unlikely over the next year, since the company's large debt burden is likely to prevent it from achieving a material improvement in credit metrics over this period. RATINGS LIST Rating Affirmed CAMP International Holding Co. Corporate credit rating B/Stable/-- New Rating CAMP International Holding Co. $370 mil. first-lien term loan Senior secured B Recovery rating 4 Rating Affirmed/Recovery Rating Revised CAMP International Holding Co. To From $30 mil. revolver Senior secured B B Recovery rating 4 3 CENTENNIAL BEVERAGE: Wants Court's OK to Pay Critical Vendors ------------------------------------------------------------- Centennial Beverage Group LLC asks the Bankruptcy Court for authorization to pay critical vendors Republic National Distribution Company and Glazer's Wholesale, 10% of its total customary weekly retail sales (6.5% to Republic and 3.5% to Glazers') to be applied towards the payment of their prepetition claims. The payments will be conditioned on said critical vendors' agreement to sell distilled spirits and wine to Centennial, the payments for which will be made in cash and in advance. Centennial owes a total prepetition amount in excess of $5 million to Republic and Glazer's, from whom Centennial purchases approximately 90% of its distilled spirits and wine inventory. Prior to the Petition Date, Centennial was placed on the Delinquent List maintained by the Texas Alcoholic Beverage Commission because of Centennial's non-payment to its vendors. About Centennial Beverage Centennial Beverage Group LLC, a chain of 23 liquor stores in Texas, filed a petition for Chapter 11 reorganization (Bankr. N.D. Tex. Case No. 12-37901) amid lower sales brought by competition from big-box retailers. The 75-year-old-company once had 70 stores throughout Texas. They are now concentrated in the Dallas-Fort Worth area. Sales for the year ended in November were $158 million. Year-over-year, revenue was down 50%, according to a court filing. In its schedules, the Debtors disclosed $24,053,049 in assets and $48,451,881 in liabilities as of the Petition Date. Robert Dew Albergotti, Esq., at Haynes And Boone, LLP, in Dallas, serves as counsel. CENTENNIAL BEVERAGE: Files Schedules of Assets and Liabilities -------------------------------------------------------------- Centennial Beverage Group, LLC, filed with the U.S. Bankruptcy Court for the Northern District of Texas its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $24,053,049 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $17,685,288 E. Creditors Holding Unsecured Priority Claims $2,780,335 F. Creditors Holding Unsecured Non-priority Claims $27,986,258 ----------- ----------- TOTAL $24,053,049 $48,451,881 A copy of the schedules is available at: http://bankrupt.com/misc/centennialbeverage.doc146.pdf About Centennial Beverage Centennial Beverage Group LLC, a chain of 23 liquor stores in Texas, filed a petition for Chapter 11 reorganization (Bankr. N.D. Tex. Case No. 12-37901) amid lower sales brought by competition from big-box retailers. The 75-year-old-company once had 70 stores throughout Texas. They are now concentrated in the Dallas-Fort Worth area. Sales for the year ended in November were $158 million. Year-over-year, revenue was down 50%, according to a court filing. Robert Dew Albergotti, Esq., at Haynes And Boone, LLP, in Dallas, serves as counsel. CENTRAL EUROPEAN: M. Kaufman Nominates Self, 3 Others to Board -------------------------------------------------------------- Mark Kaufman notified Central European Distribution Corporation of his nomination of William V. Carey, Tom Wilen, Philippe Leopold and himself as candidates for election as directors of CEDC to be voted on at the forthcoming annual meeting of shareholders on March 26. Mr. Kaufman and W & L Enterprises Ltd. together beneficially own 7,417,549 shares of the Company's common stock, representing approximately 9.4% of the Company's common shares, as reported by the TCR on Jan. 30, 2013. A complete copy of the regulatory filing is available at: http://is.gd/TzHiNC 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. CHAMPION INDUSTRIES: Dimensional Fund Reports 6.7% Equity Stake --------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 758,522 shares of common stock of Champion Industries Inc. representing 6.71% of the shares outstanding. A copy of the filing is available for free at: http://is.gd/YfIvwH About Champion Industries Champion Industries, Inc., is engaged in the commercial printing and office products and furniture supply business in regional markets east of the Mississippi River. The Company also publishes The Herald-Dispatch daily newspaper in Huntington, West Virginia with a total daily and Sunday circulation of approximately 23,000 and 28,000. Arnett Foster Toothman PLLC, in Charleston, West Virginia, expressed substantial doubt about Champion Industries' ability to continue as a going concern following the fiscal 2012 annual results. The independent auditors noted that the Company has suffered recurring losses from operations and has been unable to obtain a longer term financing solution with its lenders. The Company reported a net loss of $22.9 million in fiscal 2012, compared with a net loss of $4.0 million in fiscal 2011. The Company's balance sheet at Oct. 31, 2012, showed $47.9 million in total assets, $49.3 million in total liabilities, and a stockholders' deficit of $1.4 million. CIT GROUP: S&P Revises Outlook on 'BB-' ICR to Positive ------------------------------------------------------- Standard & Poor's Ratings Services said that it revised the outlook on its 'BB-' long-term issuer credit rating on CIT Group Inc. to positive from stable. Standard & Poor's also said that it affirmed the 'BB-' long-term issuer credit rating on CIT. S&P revised the rating outlook to positive because CIT has repaid nearly $9 billion in higher-cost legacy debt, lowered its funding cost by more than 100 basis points, and significantly boosting its core earnings since the end of March 2012. The company also has moved more of its business to its commercial bank subsidiary and maintained careful liquidity and capital management. "We could raise the rating on CIT within a year if, among other factors, the company consistently generates core profitability near the level it reported in fourth-quarter 2012," said Standard & Poor's credit analyst Brendan Browne. "Specifically, we could raise the rating if CIT consistently reports a core pretax, preprovision return on assets (ROA) ratio of more than 1.25%." By S&P's calculation, the company reported a ratio of 1.6% in fourth- quarter 2012, which was higher than S&P had expected. That ratio will likely fall somewhat in the coming quarters (since the fourth-quarter total included a few unusual items), but S&P expects it to remain above the levels the company produced during most of 2012. S&P believes that such preprovision earnings allow CIT to absorb a higher level of charge-offs than it previously could--without suffering significant bottom-line losses. "The positive outlook reflects our expectation that CIT will likely sustain the recent improvement in its earnings without taking on material additional credit risk," said Mr. Browne. "We also expect the company to only moderately loosen its robust capital and liquidity over the next year." Notwithstanding the positive outlook, several factors could limit an upgrade. First, the company remains under a written agreement with the Federal Reserve Bank of New York. S&P believes that CIT has likely satisfied most of the requirements of the agreement, which has been in place since August 2009. Still, the existence of the agreement raises some questions about whether the Federal Reserve believes that CIT has done enough to improve its underwriting and risk management. Any significant reduction in capital and liquidity would also preclude a higher rating. For instance, the company currently has regulatory total capital ratio of 17%. S&P expects that ratio to drop closer to 13% over time, but a sharp drop in the next year, particularly with a growth in assets, may prevent an upgrade. While less likely, S&P could lower its ratings on CIT if it unexpectedly increases its leverage substantially, if it weakens its liquidity management, or if S&P believes that it is substantially relaxing its underwriting standards so that it could expand its loan portfolio. "We plan to closely monitor CIT's growth in corporate finance, where it is expanding rapidly. The company's corporate finance loans and leases rose 16% in 2012. Banks and a variety of nonbank lenders are competing fairly aggressively for these types of loans and underwriting in general has probably loosened, in our view. Although we believe that CIT has not unduly eased its underwriting standards, we would be hesitant to raise our rating on the company if it continued to grow rapidly in a market that exhibited significant further evidence of deterioration in underwriting," S&P said. CITIBANK: Moody's Affirms (P)Ba2 Rating on Jr. Subordinated Debt ---------------------------------------------------------------- Moody's Investors Service changed the rating outlook on Citibank N.A. to stable from negative, while affirming the bank's deposit rating of A3 and baseline credit assessment of baa3. Ratings Rationale: The negative outlook had been assigned to Citibank N.A. on October 16, 2012, following the unexpected resignations of the previous CEO and President. These resignations raised concerns that further senior management departures might occur or that Citigroup's ongoing efforts to install improved risk management practices might falter. "A sustained improvement in Citigroup's risk culture is critical to the firm's credit strength" said Peter Nerby, a Moody's Senior Vice-President. In explaining the change of the outlook to stable from negative, Moody's observed that the reorganization announced by CEO Michael Corbat on January 7 has been orderly. Moody's believes there has been no interruption in Citigroup's efforts to install an improved risk governance culture in the company. The goal is to instill a risk structure and culture by which risk considerations become intuitively considered in business decisions throughout the firm. Considering the complexity and reach of Citigroup's global operations and the shareholder pressures it faces, accomplishing this goal is a major credit challenge. Moody's concluded, however, that the recent CEO change and management reorganization does not slow the progress the company is making towards this objective. Moody's maintained the negative outlook on the Baa2 senior debt and Baa3 subordinated debt ratings of Citigroup Inc. (the holding company) given that each of these ratings benefits from "lift" resulting from systemic support. This negative outlook has been in place since June of 2012. The negative outlook on Citigroup's debt ratings reflects Moody's views that government support for US bank holding company creditors is less certain given the FDIC's efforts to make the "Single Entry Receivership" approach operational in the event of the failure of a systemically important banking organization. An important aspect of that approach is the imposition of losses on senior and subordinated unsecured creditors at the bank-holding-company level in order to recapitalize the firm and support its systemically-important bank and non-bank subsidiaries to permit them to continue operating with minimal disruption. Other noteworthy rating actions included affirming the (P) Ba2 rating on Citigroup's junior subordinated debt and the B1 rating on its preferred shares and changing the outlook on these securities to stable from negative, as these ratings are notched off Citigroup's unsupported baseline credit assessment. The outlook on several other smaller highly-integrated subsidiaries was also changed to stable from negative (see full list of rating actions attached). The principal methodology used in these ratings was Moody's Consolidated Global Bank Rating Methodology published in June 2012. COMARCO INC: Consummates $2.5-Mil. Elkhorn Debt & Equity Financing ------------------------------------------------------------------ Comarco, Inc. disclosed that, on Monday, February 11, 2013, it has consummated a $2.5 million debt and equity financing transaction with Elkhorn Partners Limited Partnership, an existing shareholder of the Company. In that transaction, Elkhorn has made a $1.5 million secured loan to the Company maturing on November 30, 2014, and has purchased a total of 6,250,000 shares of our common stock, at a price of $0.16 per share, generating an additional $1.0 million of cash for the Company. As a result of the sale to Elkhorn of the 6,250,000 shares of Company common stock, Elkhorn's ownership has increased to approximately 49%, from approximately 9%, of the Company's outstanding shares, making Elkhorn the Company's largest shareholder. The Company has used approximately $2.1 million of the proceeds from these transactions to repay the entire principal amount of and all interest on a $2.0 million secured six month term loan that the Company had obtained from Broadwood Partners L.P. at the end of July 2012. The anticipated sale of 3 million shares of Company common stock to Broadwood, the proceeds of which were to have been used to repay the Broadwood loan, was not consummated. The balance of the proceeds from the Elkhorn loan and equity transactions are expect to be used by the Company primarily for working capital purposes. Elkhorn Loan and Security Agreements The $1.5 million loan made to us by Elkhorn bears interest at 7% for the first 12 months of the loan, increasing to 8.5% thereafter and continuing until the loan is paid in full. The loan matures on November 30, 2014; however, the Company has the right, at its option, to prepay the Elkhorn Loan, in whole or in part, without penalty or premium. Under the terms of the Elkhorn loan, if and to the extent the Company does not repay the loan in full by its maturity date (or upon acceleration of the loan after the occurrence of an event of default), then, Elkhorn will have the right, at its option (but not the obligation), to convert the then unpaid balance of the loan, in whole or in part, into shares of Company common stock at a conversion price of $0.25 per share, which will be subject to possible adjustment on certain events, such as stock splits, stock dividends and any reclassifications of the Company's outstanding shares, certain mergers and, subject to certain exceptions, sales by the Company of shares of its common stock at a price lower than $0.25 per share. The conversion price of $0.25 per share represents a premium of more than 70% over the average of the closing prices of the Company's shares in the over-the-counter market for the five trading days preceding the making of the loan by Elkhorn to the Company. The payment of, and the performance by the Company of its other obligations to Elkhorn with respect to, the loan are secured by first priority security interests granted to Elkhorn in substantially all of the assets of the Company and its wholly- owned subsidiary, Comarco Wireless Technologies, Inc. ("CWT"), and a pledge of all of CWT's shares by the Company to Elkhorn. Sale of Common Stock to Elkhorn The sale by the Company to Elkhorn of the 6,250,000 shares of common stock was made concurrently with and as a condition to the making by Elkhorn of the loan to the Company. The purchase price of $0.16 per share paid by Elkhorn for those shares was determined by arms-length negotiations between Elkhorn and the members of a special committee of the Company's Board of Directors, comprised of three of the directors who have no affiliation with Elkhorn and no financial interest, other than their interests solely as shareholders of the Company, in either the loan or share transactions with Elkhorn. That per share purchase price was determined based on a number of factors, including the inability of the Company, notwithstanding its best efforts, to raise additional capital from other prospective institutional investors during the six months ended January 25, 2013 and the recent trading prices of the Company's shares in the over-the-counter market, which averaged $0.14 per share during the five trading days immediately preceding the sale of the shares to Elkhorn, and $0.158 per share over the 29 trading days that that began on January 2, 2013 and ended on February 8, 2013. The Elkhorn loan and the shares of common stock sold to Elkhorn by the Company may not be sold or otherwise transferred in the United States by Elkhorn, except in compliance with the registration requirements of the Securities Act of 1933, as amended, or an available exemption from such requirements. Going Concern Doubt As reported by the Troubled Company Reporter on December 28, 2012, after auditing the fiscal 2012 financial results, Squar, Milner, Peterson, Miranda & Williamson, LLP, in Newport Beach, California, expressed substantial doubt about the Comarco's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses and negative cashflow from operations, has had declining working capital and uncertainties surrounding the Company's ability to raise additional funds. A copy of the Form 10-Q is available for free at: http://is.gd/OOHuiB About Comarco Inc. Based in Lake Forest, California, Comarco, Inc. (OTC: CMRO) -- http://www.comarco.com/-- is a provider of innovative, patented mobile power solutions that can be used to power and charge notebook computers, mobile phones, and many other rechargeable mobile devices with a single device. COMSTOCK MINING: Peter Palmedo Discloses 11.7% Equity Stake ----------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Peter F. Palmedo and his affiliates disclosed that, as of Dec. 31, 2012, they beneficially own 5,662,032 shares of common stock of Comstock Mining Inc. representing 11.7% of the shares outstanding. A copy of the filing is available at: http://is.gd/BlgUfG About Comstock Mining Virginia City, Nev.-based Comstock Mining Inc. is a Nevada-based, gold and silver mining company with extensive, contiguous property in the historic Comstock district. The Company began acquiring properties in the Comstock in 2003. Since then, the Company has consolidated a substantial portion of the Comstock district, secured permits, built an infrastructure and brought the exploration project into test mining production. The Company continues acquiring additional properties in the Comstock district, expanding its footprint and creating opportunities for exploration and mining. The goal of the Company's strategic plan is to deliver stockholder value by validating qualified resources (measured and indicated) and reserves (probable and proven) of 3,250,000 gold equivalent ounces by 2013, and commencing commercial mining and processing operations by 2011, with annual production rates of 20,000 gold equivalent ounces. The Company reported a net loss of $11.61 million in 2011, compared with a net loss of $60.32 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $42.15 million in total assets, $29.95 million in total liabilities and $12.19 million in total stockholders' equity. CVR REFINING: Moody's Lowers Rating on $500MM Debt to 'B2' ---------------------------------------------------------- Moody's Investors Service assigned a B1 Corporate Family Rating and a SGL-2 Speculative Grade Liquidity rating to CVR Refining LLC, a wholly owned subsidiary of CVR Refining LP. CVRR is a recently formed variable distribution master limited partnership. Simultaneously, Moody's downgraded CVR's $500 million senior notes due 2022 to B2 from Ba3 as they became unsecured upon IPO of CVRR. CVR's rating outlook is stable. In a related action, Moody's withdrew CVR Energy Inc.'s ratings, including its Ba3 CFR, Ba3-PD Probability of Default Rating, and SGL-1 Speculative Grade Liquidity rating. CVI and its indirectly wholly owned subsidiary, Coffeyville Resources LLC, have no rated debt outstanding. These actions are prompted by the redemption of debt at CRLLC and the formation of CVRR. "We view CVR Refining LP's new variable pay MLP business model as untested and inherently risky, requiring the quarterly payout of almost all excess cash," commented Arvinder Saluja, Moody's Analyst. "However, the B1 CFR considers the company's commitment to a distribution that varies with cash flow, Moody's expectations of conservative financial policies, and the reasonably strong cash flow generating capacity of its Coffeyville and Wynnewood refineries through the cycle." Assignments: Issuer: CVR Refining, LLC Corporate Family Rating at B1 Probability of Default Rating at B1-PD Speculative Grade Liquidity Rating at SGL-2 Downgrades: $500M 6.5% Senior Unsecured Notes due 2022, B2 (LGD4, 68%) from Ba3 (LGD4, 54%) Withdrawals: Issuer: CVR Energy, Inc. Corporate Family Rating, Withdrawn, previously rated Ba3 Probability of Default Rating, Withdrawn, previously rated Ba3- PD Speculative Grade Liquidity Rating, Withdrawn, previously rated SGL-1 Issuer: Coffeyville Resources, LLC $225M 10.875% Second Lien Senior Secured Regular Bond/Debenture, previously rated Ba3 Ratings Rationale: CVR's B1 CFR is restrained by the company's relatively low degree of asset diversification and the challenges that face the refining industry as a whole, including the inherent volatility of crack spreads and risk associated with regulatory capital expenditures requirements that may not produce any additional cashflow. In addition, the rating also considers the untested nature of the variable rate MLP business model, especially in the refining sector. The CFR is supported by the strategic location of its refining assets, its complementary logistics capability, and expected strong performance of its management team. The SGL-2 liquidity rating for CVR reflects good liquidity through 2013. As of the close of the IPO on January 22, 2013, CVR had $340 million in cash and $372 million available under its $400 million asset-backed revolving credit facility due December 2017. Moody's expects CVR's cash balance alone to exceed planned capital expenditures for the next year. CVR has also entered into an intercompany $150 million senior unsecured revolving credit facility with CRLLC. Moody's expects CVR to generate little, if any, free cash flow during 2013 due to cash distributions to unit holders and capital expenditure, and continue its reliance on its supply and offtake agreement with Vitol which reduces its need to maintain a revolver of a bigger size. The ABL credit facility at CVR has a fixed charge ratio covenant of 1.10x, which applies only when excess availability and projected excess availability for the six-month period following the MLP cash distributions under the facility is below 25% of either the commitment or borrowing base (whichever is lower). Moody's expects CVR to be in compliance with this covenant over the next year. Availability under the ABL credit facility is determined by a borrowing base calculated using cash and cash equivalents, certain accounts receivable and inventory. Moody's could upgrade CVR's CFR if the company increases its diversification of cashflows by adding more assets without significantly increasing leverage or decreasing returns on capital employed. Moody's could downgrade the CFR if leverage increases materially due to an acquisition, or if CVR pays aggressive cash distributions, and/or share repurchases are made by CVRR, or if there is a prolonged and severe deterioration of regional refining conditions, or if liquidity deteriorates due to a prolonged interruption of throughput. The principal methodology used in rating CVR was the Global Refining and Marketing Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. CVR Refining LLC, a wholly owned subsidiary of CVR Refining LP which is a variable distribution MLP, is a refining and marketing company. It owns 115 thousand barrel per day (mbpd) and 70 mbpd refineries in Coffeyville, KS and Wynnewood, OK, respectively. DETROIT, MI: Governor Has Short List of Managers If Needed ---------------------------------------------------------- Michael Strong, writing for Reuters, reported that Michigan Governor Rick Snyder said on Monday he has not offered the job of emergency financial manager of Detroit to anyone but does have a "short list" of candidates if he decides that the state should take over management of the city. According to the report, Snyder had selected an emergency manager, although the person to be offered the job is not former Washington, D.C., Mayor Anthony Williams. Municipal finance experts say an emergency manager for the city would be a key step that could ultimately lead to Detroit filing the largest-ever Chapter 9 municipal bankruptcy in the United States, Reuters related. Reuters said confirmation from the Republican governor that he has assembled a short list of names for the position came as a review team studying Detroit's financial situation is expected to recommend soon whether an emergency manager should be appointed. The city, Reuters noted, has been struggling for years with a falling population, shrinking tax base and large payroll for city services. DEWEY & LEBOEUF: Employee Class Suit Survives Dismissal Bid ----------------------------------------------------------- Dewey & LeBoeuf LLP lost in its bid to have a putative class action lawsuit launched by an employee who fired weeks before the firm's bankruptcy filing. The putative class action adversary proceeding was filed by Vittoria Conn, a document specialist at Dewey's New York office, on behalf of herself and all others similarly situated. The Plaintiff seeks relief for alleged violations of the WARN Acts and a determination that the alleged class claims are entitled to administrative expense or wage priority status. Dewey argues that the Plaintiff should pursue her claims through the claims allowance process rather than through an adversary proceeding, and that the Plaintiff should not be permitted to assert her claims on a class basis. The Debtor also argues that no violation of the WARN Acts occurred based on the so-called liquidating fiduciary principle. The Plaintiff filed an opposition to the Debtor's Motion, and the Debtor filed a reply. JPMorgan Chase Bank, N.A., as administrative and collateral agent for the Debtor's first lien lenders, filed a joinder of the Debtor's Motion. The Court held a hearing on the Motion to Dismiss on Jan. 24, 2013. In denying the request, Bankruptcy Judge Martin Glenn said the Plaintiff's Complaint properly asserts causes of action under the WARN Acts and that the claims seek primarily equitable relief that may be asserted in an adversary proceeding. While the Debtor may ultimately prevail on the liquidating fiduciary affirmative defense, or some other defense, the defenses are not established as a matter of law from the four corners of the Complaint. However, with respect to the Plaintiff's request that her claims be entitled to administrative expense or wage priority status, Judge Glenn said the requested relief may not be determined in an adversary proceeding, but only by motion in the main bankruptcy case. The lawsuit is, VITTORIA CONN, on behalf of herself and all others similarly situated Plaintiff, v. DEWEY & LEBOEUF LLP, Defendant, Adv. Proc. No. 12-01672 (Bankr. S.D.N.Y.). A copy of the Court's Feb. 11 Memorandum Opinion and Order is available at http://is.gd/eU4ahLfrom Leagle.com. Jack A. Raisner, Esq., and Rene S. Roupinian, Esq., at Outten & Golden LLP, in New York, represent the Plaintiff and the Putative Class. 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: Ex-Partners Call Bankruptcy Plan a Fraud --------------------------------------------------------- Helen Christophi of BankruptcyLaw360 reported that two former Dewey & LeBoeuf LLP partners on Tuesday objected to the bankrupt law firm's plan for liquidation, alleging the plan's partner contribution settlement agreements were purposely designed to fleece ex-partners. The report related that in an objection to Dewey's Second Amended Chapter 11 Plan for Liquidation, former partners Elizabeth B. Sandza and Andrew J. Fawbush claim the partner contribution settlement agreements and mutual releases for participating partners, or PCP, wasn't negotiated in good faith. The PCP "was designed and conceived to perpetrate a fraud on the firm's partners," they former partners asserted, according to the report. 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: Inks Settlement with 125 Retired Partners ---------------------------------------------------------- Dewey & LeBoeuf LLP has reached a settlement with 125 ex-partners that should clear the way for confirmation of the Debtor's Plan. The the Ad Hoc Committee of Retired Partners of LeBoeuf, Lamb, Leiby & MacRae, also signed the settlement, with the support of e the AD Hoc Committee of Former Partners, whose members sought the appointment of an examiner, were the only groups to appeal the Court's PCP Order dated Oct. 9, 2012, which approved the global settlement with more than 440 of the Debtor's former partners. Pursuant to the settlement, the Debtor is giving a broad release to the Settling Parties in exchange for the settlement of litigation and other obstacles to confirmation, and reciprocal releases (which will resolve the claims filed by those former partners), and the payment of a fixed settlement amount. The settlement provides that 125 former partners (or their beneficiaries) are being asked to pay, among other things, the lesser of (i) 25% of combined of-counsel or special counsel compensation and non-qualified retirement plan payments paid by the Debtor and received by the Settling Partner in 2011 and 2012, or (ii) $5,000. Each settling partner has further agreed to reimburse the Debtor at a rate of 60% for any tax advances made by the Debtor on behalf of the Settling Partner during 2011 and 2012. Finally, each settling partner has agreed to make a payment to the Debtor on account of all other amounts received from the Debtor during 2011 and 2012, if any, which payment is calculated using the same table included in the PCP. The FPC and AHC have also agreed to stay, then dismiss, the pending Appeals of the PCP Order. The Debtor will disclose a list of Settling Partners and their corresponding Settlement Amounts on or before Feb. 18, 2013, at 4 p.m. A summary of the key terms of the proposed settlement is available at http://bankrupt.com/misc/dewey.doc977.pdf 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. DIOCESE OF WILMINGTON: Trustee Objects to Tort Claim No. 70 ----------------------------------------------------------- The trustee of the Catholic Diocese of Wilmington Inc. Qualified Settlement Fund filed an objection, which seeks to disallow and expunge Claim No. 70. The move came after the trustee found out that a similar claim was filed by the same creditor in the bankruptcy case of The Christian Brothers' Institute and The Christian Brothers of Ireland, Inc. The case is pending before the U.S. Bankruptcy Court in Manhattan. In a court filing, Maria Eskin said Claim No. 70 is a "false claim" and shouldn't be allowed. The trustee asked approval from the U.S. Bankruptcy Court for the District of Delaware to forego payment to the claimant. About the Diocese of Wilmington The Diocese of Wilmington covers Delaware and the Eastern Shore of Maryland and serves about 230,000 Catholics. In 2009, the Delaware diocese became the seventh Roman Catholic diocese to file for Chapter 11 protection to deal with lawsuits for sexual abuse. Previous filings were by the dioceses in Spokane, Washington; Portland, Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and San Diego, California. The Diocese filed for Chapter 11 protection (Bankr. D. Del. Case No. 09-13560) on Oct. 18, 2009. Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Diocese. The Ramaekers Group, LLC, is the financial advisor. The petition says assets range $50 million to $100 million while debts are between $100 million to $500 million. The bankruptcy filing automatically stayed eight consecutive abuse trials scheduled in Delaware scheduled to begin Oct. 19, 2009. There were 131 cases filed against the Diocese, with 30 scheduled for trial, as of the bankruptcy filing. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). DVORKIN HOLDINGS: Trustee Hiring Entre as Real Estate Broker ------------------------------------------------------------ The Bankruptcy Court has granted Gus A. Paloian, Chapter 11 Trustee of the estate of Dvorkin Holdings, LLC, permission to employ Entre Commercial Realty LLC as real estate broker to the estate. Entre will sell the Debtor's commercial/industrial property commonly known as 1941 Selmartin, Aurora, Illinois. The broker's commission will consist of (a) 5% of the first $1,000,000 of the sale proceeds, and (b) 4% of the sale proceeds in excess of $1,000,000. Michael Gazzola, a senior member of Entre Commercial Realty LLC, attested that Entre is a "disinterested person" as that term is defined in Sections 327(a) and 101(14), and that Entre neither represents nor holds an interest adverse to the Trustee. About Dvorkin Holdings Dvorkin Holdings, LLC, a holding company that has interests in 40 non-debtor entities, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 12-31336) in Chicago on Aug. 7, 2012. The Debtor estimated assets of at least $10 million and debts of up to $10 million. Bankruptcy Judge Jack B. Schmetterer oversees the case. Michael J. Davis, Esq., at Springer, Brown, Covey, Gaetner & Davis, in Wheaton, Illinois, served as counsel to the Debtor. The petition was signed by Loran Eatman, vice president of DH-EK Management Corp. The Bankruptcy Court in October 2012 granted the request of Patrick S. Layng, the U.S. Trustee for the Northern District of Illinois, to appoint Gus Paloian as the Chapter 11 trustee. Lender, FirstMerit Bank, N.A., also sought appointment of a chapter 11 trustee. DRYSHIPS INC: Announces Upsizing & Pricing of Ocean Rig Shares -------------------------------------------------------------- DryShips Inc. on Feb. 12 announced the upsizing of the previously announced public offering of common shares of Ocean Rig that it owns to 7,500,000 common shares and that the offering has priced with gross proceeds of approximately $126.4 million. Following the completion of the offering, DryShips is expected to own approximately 59.4% of Ocean Rig's outstanding shares. The offering is expected to close on February 14, 2013. Deutsche Bank Securities and Credit Suisse are acting as joint book-running managers for the offering. About DryShips Inc. Based in Greece, DryShips Inc. -- http://www.dryships.com/-- -- owns and operates drybulk carriers and offshore oil deep water drilling units that operate worldwide. As of Sept. 10, 2010, DryShips owns a fleet of 40 drybulk carriers (including newbuildings), comprising 7 Capesize, 31 Panamax and 2 Supramax, with a combined deadweight tonnage of over 3.6 million tons and 6 offshore oil deep water drilling units, comprising of 2 ultra deep water semisubmersible drilling rigs and 4 ultra deep water newbuilding drillships. DryShips's common stock is listed on the NASDAQ Global Select Market where it trades under the symbol "DRYS". On Nov. 25, 2010, DryShips Inc. entered into a waiver letter for its US$230.0 million credit facility dated Sept. 10, 2007, as amended, extending the waiver of certain covenants through Dec. 31, 2010. The Company reported a net loss of US$47.28 million in 2011, compared with net income of US$190.45 million during the prior year. The Company's balance sheet at Dec. 31, 2011, showed US$8.62 billion in total assets, US$4.68 billion in total liabilities, and US$3.93 billion in total equity., Inc. EASTBRIDGE INVESTMENT: Amends Merger Agreement with CBMG -------------------------------------------------------- EastBridge Investment Group Corporation, CBMG Acquisition Limited, the Company's wholly-owned subsidiary ("Merger Sub") and Cellular Biomedicine Group Ltd., amended the Agreement and Plan of Merger previously entered into on Nov. 13, 2012, as amended. In Amendment No. 3 the parties agreed to: (i) reduce the number of additional directors to be appointed to the board of directors at closing from seven to five; (ii) amend officer titles such that Steve Wen Tao Liu will be Chief Executive Officer, Wei (William) Cao will be President, and Andrew Chan will be Chief Financial Officer and Secretary; and (iii) provide CBMG with a five day grace period for payment to EastBridge Sub of the $500,000 payment due at closing. A copy of Amendment No. 3 is available at: http://is.gd/7UPa4g On Nov. 13, 2012, EastBridge and Merger Sub entered into the Merger Agreement with CBMG, pursuant to which CBMG was the surviving entity in the Merger. Upon consummation of the Merger, CBMG shareholders were issued 3,638,932 shares of common stock, par value $0.001 per share, of EastBridge constituting approximately 70% of the outstanding stock of EastBridge on a fully-diluted basis and the current EastBridge shareholders will retain 30% of the Company on a fully-diluted basis. Specifically, each of CBMG's ordinary shares were converted into the right to receive 0.020019 share of EastBridge Common Stock. Lockup Agreement The Company is a party to a lockup agreement with Global Health Investment Holdings Ltd., which is a significant stockholder of the Company. The lockup agreement was entered into between Global Health and CBMG on Jan. 21, 2013, and assumed by the Company on the closing date of the merger on Feb. 6, 2013. Under the agreement, Global Health agreed for a period of one year after the closing date of the Merger to (i) not offer, sell, agree to sell, contract to sell, hypothecate, pledge, grant any option to purchase, make any short sale, or otherwise dispose of or hedge, directly or indirectly, any of the Company's common stock or any securities convertible into or exchangeable or exercisable for the Company's common stock, or publicly announce an intention to effect any such transaction, in connection with Global Health's shares, or exercise any right with respect to the registration of its shares, or file or cause to be filed any registration statement in connection with its shares without prior written consent of the Company; or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, the economic consequences of ownership of Global Health's shares without prior written consent of the Company. Deferred Compensation Arrangement with Former Officers On Feb. 5, 2013, the Company entered into a Deferred Compensation Agreement with Keith Wong and Norman Klein, in which the Company agreed to: (i) pay its Former Executives certain accrued unpaid cash compensation consisting of $676,839 payable to Keith Wong and $459,300 payable to Norman Klein; and (ii) pay on Aug. 31, 2013, a cash bonus payment of $204,723 to Mr. Wong and $152,577 to Mr. Klein. Termination of Employment Agreements Effective as of Feb. 6, 2013, Norman Klein and Keith Wong's employment agreements with EastBridge were terminated. Sub Employment Agreements On Feb. 6, 2013, EastBridge Sub, a wholly-owned subsidiary of the Company, entered into employment agreements with Norman Klein and Keith Wong. Pursuant to Mr. Wong's Subsidiary Employment Agreement with EastBridge Sub, Mr. Wong is entitled to an annual base salary of $240,000. Mr. Wong will is also eligible to participate in the Company's Plan and receive an option grant to purchase 30,000 shares of the Company's common stock with an exercise price equal to the volume weighted average or the price per share of the Company common stock as quoted on the OTCQB for the three trading days preceding Feb. 6, 2013. The option grant will vest over a two year period at a rate of 1,250 shares per month and will be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the board of directors of the Company or compensation committee. Pursuant to Mr. Klein's Subsidiary Employment Agreement with EastBridge Sub, Mr. Klein is entitled to an annual base salary of $180,000. Mr. Klein will is also eligible to participate in the Company's Plan and receive an option grant to purchase 30,000 shares of the Company's common stock with an exercise price equal to the volume weighted average or the price per share of the Company common stock as quoted on the OTCQB for the three trading days preceding Feb. 6, 2013. The option grant will vest over a two year period at a rate of 1,250 shares per month and will be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the board of directors of the Company or compensation committee. A copy of the Form 8-K disclosure is available for free at: http://is.gd/8Y6xOQ 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. ENERGYSOLUTIONS INC: Seeks to Amend Credit Facility with JPMorgan ----------------------------------------------------------------- EnergySolutions, Inc., is seeking a proposed amendment with respect to the Credit Agreement, with JPMorgan Chase Bank, N.A., as administrative agent, dated Aug. 13, 2010, as amended. The proposed amendment is being sought in connection with the Agreement and Plan of Merger, dated Jan. 7, 2013, by and among Rockwell Holdco, Inc., which is an affiliate of Energy Capital Partners II, LLC, Rockwell Acquisition Corp. ("Merger Sub") and the Company. In connection with the entry into the Merger Agreement, Parent received a debt commitment letter, dated Jan. 7, 2013, from Morgan Stanley Senior Funding, Inc. Pursuant to the Debt Commitment Letter, the Commitment Party has committed to provide an aggregate of $685 million in debt financing to Merger Sub. The Proposed Amendment is being sought as an alternative to the funding under the Debt Commitment Letter. A copy of a presentation to be made to lenders party to the Credit Agreement, dated Feb. 11, 2013, in connection with the Proposed Amendment is available for free at http://is.gd/HEejk0 Completes Restructuring Plan EnergySolutions confirmed on Feb. 11, 2013, that it has substantially completed the restructuring plan to reduce its operating costs and improve profitably that was announced in October 2012. As a result of the successful implementation of this plan, the Company expects to improve the margins in its business overall, including its Logistics, Processing and Disposal business division. About EnergySolutions Salt Lake City, Utah-based EnergySolutions offers customers a full range of integrated services and solutions, including nuclear operations, characterization, decommissioning, decontamination, site closure, transportation, nuclear materials management, the safe, secure disposition of nuclear waste, and research and engineering services across the fuel cycle. The Company's balance sheet at Sept. 30, 2012, showed $2.85 billion in total assets, $2.54 billion in total liabilities, and $311.77 million in total stockholders' equity. * * * As reported in the Jan. 9, 2013 edition of the TCR, Standard & Poor's Ratings Services placed its ratings, including its 'B' corporate credit rating, on EnergySolutions on CreditWatch with developing implications. "The CreditWatch placement follows EnergySolutions' announcement that it has entered into a definitive agreement to be acquired by a subsidiary of Energy Capital Partners II," said Standard & Poor's credit analyst Jim Siahaan. EnergySolutions is permitted to engage in discussions with other suitors, which may include other financial sponsors or strategic buyers. EXCEL DIRECTIONAL: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Excel Directional Technologies, LLC 2106 Denton Drive Austin, TX 78758 Bankruptcy Case No.: 13-10260 Chapter 11 Petition Date: February 11, 2013 Court: United States Bankruptcy Court Western District of Texas (Austin) Judge: H. Christopher Mott Debtor's Counsel: Barbara M. Barron, Esq. Stephen W. Sather, Esq. BARRON & NEWBURGER, P.C. 1212 Guadalupe, #104 Austin, TX 78701 Tel: (512) 476-9103 Fax: (512) 476-9253 E-mail: bbarron@bnpclaw.com ssather@bnpclaw.com Scheduled Assets: $5,127,100 Scheduled Liabilities: $4,104,515 A copy of the Company's list of its 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/txwb13-10260.pdf The petition was signed by Timothy P. Tarver, president. FAIRWEST ENERGY: CCAA Stay Extended to March 15 ----------------------------------------------- FairWest Energy Corporation on Feb. 12 disclosed that it obtained an Order on February 11, 2013 from the Court of Queen's Bench of Alberta extending the stay of proceedings under the Initial Order granting relief to FairWest under the Companies' Creditors Arrangement Act to March 15, 2013 and increasing the principal amount available under the debtor-in-possession credit facility with Supreme Group Inc. from $700,000 to $800,000. FairWest is a Calgary, Alberta based junior oil and gas company engaged in the acquisition, exploration, development and production of crude oil, natural gas and natural gas liquids in the provinces of Alberta and Saskatchewan. FARER FRESKO: $1.8-Mil. Deal Resolves Claims over Bankruptcy ------------------------------------------------------------ Linda Chiem of BankruptcyLaw360 reported that a New Jersey bankruptcy judge on Monday approved settlements totaling $1.8 million to resolve a lease dispute and a trustee's allegation that defunct environmental and real estate firm Farer Fersko PA fraudulently transferred its assets to another firm instead of its bankruptcy estate. The report related that U.S. Bankruptcy Judge Rosemary Gambardella signed off on a deal in which Greenbaum Rowe Smith & Davis LLP agreed to fork over $720,000 in two installments to Farer Fersko's trustee Benjamin Stanziale Jr. FLEXIBLE FLYER: Workers' WARN Act Suit Crashes in 5th Circuit ------------------------------------------------------------- Eric Hornbeck of BankruptcyLaw360 reported that Flexible Flyer Liquidating Trust didn't have to give employees 60 days' notice of mass layoffs because the toymaker's bankruptcy came from the sudden and unexpected end of financial support from private equity firm Cerberus Capital Management Corp., the Fifth Circuit ruled Monday. The report related that a group of former Flexible Flyer workers had alleged the toy company violated the Worker Adjustment and Retraining Notification Act, which requires employers to give 60 days' notice before mass layoffs, when it laid off employees the same day it filed for bankruptcy. The suit alleged that About Flexible Flyer Flexible Flyer manufactured swing sets, hobby horses, go-carts, utility vehicles, fitness equipment, and related products that were sold to Wal-Mart, Toys-R-Us, K-Mart, Sam's Club, as well as, other large and small retailers. Flexible Flyer filed a voluntary Chapter 11 bankruptcy petition (Bankr. N.D. Miss. 05-16187) on September 9, 2005, after CIT Group Commercial Systems, LLC, canceled the parties' financing arrangement, and Cerberus Capital Management Corporation, Flexible Flyer's parent company, refused to infuse capital. FLEXTRONICS INT'L: Moody's Assigns 'Ba1' Rating to New Sr. Notes ---------------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to Flextronics International Ltd.'s proposed senior unsecured notes. All other ratings, including the Ba1 corporate family rating, Ba1-PD probability of default rating, and the stable outlook remain unchanged. Proceeds from these notes are expected to repay a portion of the existing $1 billion term loan due in 2014. Ratings Rationale: Flextronics' Ba1 Corporate Family Rating is supported by the status as a Tier-1 EMS provider, evidenced by its global scale, diversity and size as the second largest EMS player in the world by revenues. Flextronics has a global manufacturing footprint with facilities located in low labor cost regions near OEM customer sites, and has developed vertically-integrated operations and end- to-end product life cycle capabilities. Nonetheless, there is volatility in operating performance resulting from limited demand visibility, high customer concentration and high fixed costs associated with managing vertically-integrated operations across a global footprint. Ratings assigned: Senior Unsecured Notes -- rated Ba1 LGD3-42% Ratings affirmed: CFR at Ba1 PDR at Ba1-PD Rating Outlook Stable What Could Change the Rating - Up The rating could be upgraded to the extent Flextronics demonstrates market share gains relative to competitors, diversifies its business away from traditional EMS segments and lessens its current client concentration. In addition, an upgrade could be considered if the company sustains operating margins above 3.5% (Moody's adjusted), adjusted total debt to EBITDA approaches 2.0x (Moody's adjusted), and the company consistently generates annual cash flow from operations above $1.3 billion. What Could Change the Rating - Down Ratings could be downgraded if Flextronics experiences material customer/program losses without offsetting increases in new customer wins/program ramps, Moody's believes there could be a declines in core operating margin approaching 2.0% (Moody's adjusted) or a sustained increase in adjusted total debt to EBITDA above 3.0x (Moody's adjusted). The principal methodology used in rating Flextronics International Ltd. was the Global Distribution & Supply Chain Services published in November 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. With about $24 billion of projected annual revenues, Flextronics International Ltd. is one of the largest global providers of contract electronics manufacturing services to original equipment manufacturers. FTMI REAL ESTATE: Court Dismisses Chapter 11 Case ------------------------------------------------- The Chapter 11 case of FTMI Real Estate, LLC, has been dismissed with prejudice to the filing of a petition under any chapter of the Bankruptcy Code for a period of one year from the entry of the dismissal order. The dismissal of the bankruptcy case is conditional to the Debtor paying all outstanding United States Trustee fees and the Clerk of Court's fees, costs, and charges. About FTMI Real Estate FTMI Real Estate LLC and FTMI Operator LLC sought Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 12-29214) in Fort Lauderdale on Aug. 10, 2012. FTMI Operator, which operates a health care business The Lenox on The Lake, disclosed just $112,000 in assets and $31.98 million in liabilities. The LENOX -- http://www.thelenox.com-- is South Florida's, newest state-of-the-art Assisted Living and Memory Care community, which has a serene lakeside setting and wonderful waterfront vistas. FTMI Real Estate, a single asset real estate under 11 U.S.C. Sec. 101(51B), scheduled $19.64 million in assets and $28.93 million in liabilities. The Debtor owns The Lenox on The Lake facilities at 6700 Commercial Boulevard, in Lauderhill, Florida valued at $13 million. The Secretary of Housing Urban Development has a $25.87 million claim secured by the property. GELTECH SOLUTIONS: Incurs $1.4 Million Net Loss in Dec. 31 Qtr. --------------------------------------------------------------- GelTech Solutions, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $1.40 million on $37,453 of sales for the three months ended Dec. 31, 2012, compared with a net loss of $1.41 million on $84,551 of sales for the same period a year ago. For the six months ended Dec. 31, 2012, the Company incurred a net loss of $3.21 million on $121,903 of sales, as compared with a net loss of $2.87 million on $262,953 of slaes for the same period during the prior year. The Company's balance sheet at Dec. 31, 2012, showed $1.15 million in total assets, $3.80 million in total liabilities and a $2.65 million total stockholders' deficit. "As of December 31, 2012, the Company had a working capital deficit, an accumulated deficit and stockholders' deficit of $1,339,923, $26,011,370 and $2,655,057, respectively, and incurred losses from operations of $3,211,484 for the six months ended December 31, 2012 and used cash from operations of $1,994,491 during the six months ended December 31, 2012. In addition, the Company has not yet generated revenue sufficient to support ongoing operations. These factors raise substantial doubt regarding the Company's ability to continue as a going concern." A copy of the Form 10-Q is available for free at: http://is.gd/jUyBaF About GelTech Jupiter, Fla.-based GelTech Solutions. Inc., is a Delaware corporation organized in 2006. The Company markets four products: (1) FireIce(R), a water soluble fire retardant used to protect firefighters, structures and wildlands; (2) Soil2O(R) 'Dust Control', its new application which is used for dust mitigation in the aggregate, road construction, mining, as well as, other industries that deal with daily dust control issues; (3) Soil2O(R), a product which reduces the use of water and is primarily marketed to golf courses, commercial landscapers and the agriculture market; and (4) FireIce(R) Home Defense Unit, a system for applying FireIce(R) to structures to protect them from wildfires. GENE CHARLES: Can Enter into Pipeline Agreements With AMS --------------------------------------------------------- The Bankruptcy Court has granted Gene Charles Valentine Trust permission: (1) to enter into pipeline right-of-agreements, roadway easement agreements, and surface use agreement with Appalachia Midstream Services, LLC ("AMS"), related to the Aspen Manor property and (2) to use cash collateral from such pipeline agreements, pursuant to the terms of the stipulation by and among the Debtor, Gene Charles Valentine, as guarantor, Catholic Financial Life, and AMS. CFL holds a Deed of Trust of the property known as 1500 Brinker Road, Wellsburg, West Virginia and surrounding vacant land, commonly known as "Aspen Manor", as security for a loan CFL granted to the Debtor. Pursuant to the Pipeline Agreements, AMS will pay the Debtor $210,000, which proceeds constitute cash collateral of CFL. As reported in the TCR on Jan. 8, 2013, AMS wishes to construct at least 2 pipelines on the Aspen Manor property as well as an access road on the Aspen Manor property, pursuant to the Pipeline Agreements. A copy of the stipulation and agreed order is available at: http://bankrupt.com/misc/genecharles.doc403.pdf About Gene Charles Valentine A business trust created by investment advisor and broker-dealer agent Gene Charles Valentine sought Chapter 11 bankruptcy protection (Bankr. N.D. W.Va. Case No. 12-01078) in Wheeling, West Virginia on Aug. 9, 2012. The Gene Charles Valentine Trust owns commercial and real estate properties in West Virginia, the Financial West Group, the Peace Point Equestrian Center and the Aspen Manor. The Debtor disclosed in its schedules $34,101,393 in total assets and $22,623,554 in total liabilities. Financial West Investment Group, Inc., doing business as Financial West Group -- http://www.fwg.com/-- is a firm with more than 340 registered representatives supervised by 44 Offices of Supervisory Jurisdiction throughout the United States. Financial West Group is a FINRA, and SIPC member and SEC Registered Investment Advisor (over $1 billion under control) that offers a full range of financial products and services. Its corporate office 32 member staff is dedicated to providing registered representatives quality service and technology to allow them to focus on best servicing their investors needs. Aspen Manor -- http://www.aspenmanorresort-- is a resort that claims to be the "The Jewel of the Ohio Valley." Along with its architectural artistry, including hand-carved ceilings, the Manor is filled will original art, statues, historic furniture and artifacts. Bankruptcy Judge Patrick M. Flatley oversees the case. The Trust hired Mazur Kraemer Law Inc., as bankruptcy counsel. GLOBAL AVIATION: Exits Chapter 11 Bankruptcy -------------------------------------------- Global Aviation Holdings Inc. disclosed that its plan of reorganization, which was approved by the United States Bankruptcy Court for the Eastern District of New York on December 6, 2012, became effective on Feb. 13 allowing the Company to complete its financial restructuring and emerge from Chapter 11. The Plan reflects a global settlement with the Company's first and second lien lenders, the official committee of unsecured creditors, and the Company's labor unions, allowing the Company to exit from bankruptcy with reduced debt, a rationalized and lower cost fleet, and new five-year collective bargaining agreements with four of its five represented work groups. In connection with the Plan, the Company also secured an exit financing facility of $35 million. The exit facility, liquidity on hand, and reduced cost structure provide the necessary framework to effectively compete in today's marketplace. "With today's successful emergence from Chapter 11, we are well positioned for success and can devote our full attention to growth and business development," stated Rob Binns, CEO. "We are emerging from bankruptcy as a much stronger company with significantly reduced debt and the appropriate aircraft fleet and operational structure to compete in today's challenging economic environment." Mr. Binns added, "We want to thank our customers, suppliers, lenders, advisors, and dedicated employees for their support throughout the Chapter 11 process. The commitment of our stakeholders has been a key component to completing the necessary financial and operational restructuring of the Company." About Global Aviation Global Aviation Holdings Inc., based in Peachtree City, Ga., is the parent company of North American Airlines and World Airways. Global is the largest commercial provider of charter air transportation for the U.S. military, and a major provider of worldwide commercial global passenger and cargo air transportation services. North American Airlines, founded in 1989 and based in Jamaica, N.Y., operates passenger charter flights using B757-200ER and B767-300ER aircraft. World Airways, founded in 1948 and based in Peachtree City, Ga., operates cargo and passenger charter flights using B747-400 and MD-11 aircraft. Global Aviation, along with affiliates, filed Chapter 11 petitions (Bankr. E.D.N.Y. Case No. 12-40783) on Feb. 5, 2012. Global's lead counsel in connection with the restructuring is Kirkland & Ellis LLP and its financial advisor is Rothschild. Kurtzman Carson Consultants LLC is the claims agent. The Debtors disclosed $589.8 million in assets and $493.2 million in liabilities as of Dec. 31, 2011. Liabilities include $146.5 million on 14% first-lien secured notes and $98.1 million on a second-lien term loan. Wells Fargo Bank NA is agent for both. Global said it will use Chapter 11 to shed 16 of 30 aircraft. In addition, Global said it will use Chapter 11 to negotiate new collective bargaining agreements with its unions and deal with liabilities on multi-employer pension plans. On Feb. 13, 2012, the U.S. Trustee for Region 2 appointed a seven- member official committee of unsecured creditors in the case. The Committee tapped Lowenstein Sandler PC as its counsel, and Imperial Capital, LLC as its financial advisor. The Debtors had a court-approved Chapter 11 plan, thanks to a settlement with second-lien creditors and the unsecured creditors' committee. The Debtor negotiated a plan with senior lenders where secured noteholders owed $111.4 million were to receive 75% ownership of the reorganized company. Unsecured creditors and second-lien noteholders originally were to receive nothing. GSC GROUP: Capstone Reaches Settlement with U.S. Trustee -------------------------------------------------------- Capstone Advisory Group, LLC on Feb. 13 disclosed that it has reached a settlement, subject to approval of the bankruptcy court, with the Executive Office of the United States Trustee of the allegations in the GSC Group bankruptcy case regarding Capstone's relationship with Robert Manzo. Mr. Manzo was, for more than six years, a full-time Capstone Executive Director who led Capstone's engagements in some of the most significant bankruptcy cases in the country, including the GSC Group matter. Mr. Manzo, like many senior professional advisors and attorneys, elected to structure his relationship with Capstone through a single-member limited liability company that entered into a contract with Capstone. Despite acknowledging in court filings that "there is no evidence that Mr. Manzo's rates were inflated," the United States Trustee contended that, because Mr. Manzo was not a member or employee of Capstone, it was inappropriate for Capstone to pay Mr. Manzo from fees earned in the bankruptcy cases and that his compensation from Capstone had to be disclosed. Capstone vigorously disputed these allegations, including the need for any disclosure, and the parties' settlement agreements acknowledge that denial. Capstone elected to settle without the need for further litigation to avoid the disruption and cost of continued litigation. Through the settlement, if approved, Capstone will reduce its total fees for post-filing work for the GSC Group by $1 million, or approximately 15%. Capstone will receive a full release from the United States Trustee with respect to these issues and will be entitled to keep all other fees earned in the GSC Group estate. Capstone has agreed to retain the services of a monitor to review its bankruptcy retention and disclosure policies and procedures, which Capstone believes are already among the best in the industry and were the product of prior reviews by leading law firms and undertaken independent of this litigation. Capstone takes seriously its obligations to the courts before which it appears, and welcomes the opportunity to ensure that it continues to make all necessary disclosures. The GSC Group case represents the best of what Capstone does as a firm for its clients every day. While initially offered only $5 million for all the debtors' assets, Capstone managed an auction process that raised more than $235 million in proceeds, and, together with other subsequent asset sales, is expected to generate a meaningful recovery for creditors. The remarkable success of Capstone's work for the GSC Group. About GSC Group Florham Park, New Jersey-based GSC Group, Inc. -- http://www.gsc.com/-- was a private equity firm that specialized in mezzanine and fund of fund investments. Originally named Greenwich Street Capital Partners Inc. when it was a subsidiary of Travelers Group Inc., GSC became independent in 1998 and at one time had $28 billion of assets under management. Market reverses, termination of some funds, and withdrawal of customers' investments reduced funds under management at the time of bankruptcy to $8.4 billion. GSC Group, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010. Michael B. Solow, Esq., at Kaye Scholer LLP, served as the Debtor's bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice and claims agent. Capstone Advisory Group LLC served as the Debtor's financial advisor. The Debtor estimated its assets at $1 million to $10 million and debts at $100 million to $500 million as of the Chapter 11 filing. Since Jan. 7, 2011, the Debtors have been operated by James L. Garrity Jr., as Chapter 11 trustee for the Debtors. The Chapter 11 trustee tapped Shearman & Sterling LLP as his counsel, and Togut, Segal & Segal LLP as his conflicts counsel. No committee of unsecured creditors has been appointed in the case. The Chapter 11 trustee completed the sale of business in July 2011 and filed a liquidating Chapter 11 plan and explanatory disclosure statement in late August. The bankruptcy court authorized the trustee to sell the business to Black Diamond Capital Finance LLC, as agent for the secured lenders. Proceeds were used to pay secured claims. The price paid by the lenders' agent was designed for full payment on $256.8 million in secured claims, with $18.6 million cash left over. Black Diamond bought most assets with a $224 million credit bid, a $6.7 million note, $5 million cash, and debt assumption. A minority group of secured lenders filed an appeal from the order allowing the sale. Through a suit in state court, the minority lenders failed to halt Black Diamond from completing the sale. The Chapter 11 Trustee and Black Diamond have filed rival repayment plans for GSC Group. The Chapter 11 trustee reached a handshake deal on Dec. 13, 2011, ending the dispute with Black Diamond that delayed a $235 million asset sale. Adam Goldberg, Esq., and Douglas Bacon, Esq., at Latham & Watkins, represent Black Diamond Capital Management, LLC, as counsel. Patrick J. Nash, Jr., Esq., and Paul Wierbicki, Esq. of Kirkland & Ellis LLP serve as counsel to Black Diamond Capital Management, LLC. GSC GROUP: US Trustee Wrests $1.2MM from Advisers Over Fee-Sharing ------------------------------------------------------------------ Lance Duroni of BankruptcyLaw360 reported that Capstone Advisory Group LLC and a financial expert settled with the U.S. Trustee's office Monday over an undisclosed fee-sharing arrangement between the advisers in GSC Group Inc.'s bankruptcy, agreeing to give up nearly $1.2 million in fees combined. The report, citing settlement papers filed in New York bankruptcy court, related that Capstone and financial expert Robert J. Manzo will also submit to stricter oversight of their bankruptcy work to appease the trustee, who accused the two of committing ethics and disclosure violations while advising the bankrupt investment management firm. About GSC Group Florham Park, New Jersey-based GSC Group, Inc. -- http://www.gsc.com/-- was a private equity firm that specialized in mezzanine and fund of fund investments. Originally named Greenwich Street Capital Partners Inc. when it was a subsidiary of Travelers Group Inc., GSC became independent in 1998 and at one time had $28 billion of assets under management. Market reverses, termination of some funds, and withdrawal of customers' investments reduced funds under management at the time of bankruptcy to $8.4 billion. GSC Group, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010. Michael B. Solow, Esq., at Kaye Scholer LLP, served as the Debtor's bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice and claims agent. Capstone Advisory Group LLC served as the Debtor's financial advisor. The Debtor estimated its assets at $1 million to $10 million and debts at $100 million to $500 million as of the Chapter 11 filing. Since Jan. 7, 2011, the Debtors have been operated by James L. Garrity Jr., as Chapter 11 trustee for the Debtors. The Chapter 11 trustee tapped Shearman & Sterling LLP as his counsel, and Togut, Segal & Segal LLP as his conflicts counsel. No committee of unsecured creditors has been appointed in the case. The Chapter 11 trustee completed the sale of business in July 2011 and filed a liquidating Chapter 11 plan and explanatory disclosure statement in late August. The bankruptcy court authorized the trustee to sell the business to Black Diamond Capital Finance LLC, as agent for the secured lenders. Proceeds were used to pay secured claims. The price paid by the lenders' agent was designed for full payment on $256.8 million in secured claims, with $18.6 million cash left over. Black Diamond bought most assets with a $224 million credit bid, a $6.7 million note, $5 million cash, and debt assumption. A minority group of secured lenders filed an appeal from the order allowing the sale. Through a suit in state court, the minority lenders failed to halt Black Diamond from completing the sale. The Chapter 11 Trustee and Black Diamond have filed rival repayment plans for GSC Group. The Chapter 11 trustee reached a handshake deal on Dec. 13, 2011, ending the dispute with Black Diamond that delayed a $235 million asset sale. Adam Goldberg, Esq., and Douglas Bacon, Esq., at Latham & Watkins, represent Black Diamond Capital Management, LLC, as counsel. Patrick J. Nash, Jr., Esq., and Paul Wierbicki, Esq. of Kirkland & Ellis LLP serve as counsel to Black Diamond Capital Management, LLC. HERCULES OFFSHORE: Dimensional Fund Reports 8% Equity Stake ----------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 12,680,695 shares of common stock of Hercules Offshore Inc. representing 8% of the shares outstanding. A copy of the filing is available for free at: http://is.gd/cNEGmB 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. HOVNANIAN ENTERPRISES: State Street Discloses 1.4% Equity Stake --------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, State Street Corporation disclosed that, as of Dec. 31, 2012, it beneficially owns 14,625,137 shares of common stock of Hovnanian Enterprises representing 12.2% of the shares outstanding. In a subsequent filing, State Street disclosed beneficial ownership of 1,728,202 common shares or a 1.4% equity stake as of Jan. 31, 2013. A copy of the amended Schedule 13G is available for free at http://is.gd/zw1BUm About Hovnanian Enterprises Red Bank, New Jersey-based Hovnanian Enterprises, Inc. (NYSE: HOV) -- http://www.khov.com/-- founded in 1959 by Kevork S. Hovnanian, is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes and CraftBuilt Homes. As the developer of K. Hovnanian's Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes. For the 12 months ended Oct. 31, 2012, the Company reported a net loss of $66.19 million on $1.48 billion of total revenues, compared with a net loss of $286.08 million on $1.13 billion of total revenues for the same period a year ago. The Company's balance sheet at Oct. 31, 2012, showed $1.68 billion in total assets, $2.16 billion in total liabilities and a $485.34 million in total deficit. * * * As reported by the TCR on Nov. 7, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Hovnanian Enterprises Inc. to 'CCC+' from 'CCC-' and removed it from CreditWatch positive. "We raised our corporate credit rating to reflect operating performance that is better than we expected, resulting in narrowing pretax losses," said credit analyst George Skoufis. "It also reflects improved liquidity following the recent debt issuances that will extend the bulk of the company's 2016 maturities to 2020 and reduce its overall interest burden." In the Dec. 11, 2012, edtiiton of the TCR, Fitch Ratings has affirmed the ratings for Hovnanian Enterprises, Inc. (NYSE: HOV), including the company's Issuer Default Rating (IDR), at 'CCC'. The rating for HOV is influenced by the company's execution of its business model, land policies, and geographic, price point and product line diversity. The rating additionally reflects the company's liquidity position, substantial debt and high leverage. Hovnanian carries 'Caa2' corporate family and probability of default ratings from Moody's. Moody's said in April 2012 that the Caa2 corporate family rating reflects Hovnanian's elevated debt leverage weak gross margins, continued operating losses, negative cash flow generation, and Moody's expectation that the conditions in the homebuilding industry over the next one to two yeas will provide limited opportunities for improvement in the company's operating and financial metrics. In addition, the ratings consider Hovnanian's negative net worth position, which Moody's anticipates will be further weakened by continuing operating losses and impairment charges. As a result, adjusted debt leverage, currently standing at 149%, is likely to increase further. IBIO INC: NYSE MKT Accepts Listing Compliance Plan -------------------------------------------------- iBio, Inc. on Feb. 13 disclosed that it has been notified by the NYSE MKT Staff that the Exchange has accepted the Company's plan of compliance which was submitted on December 21, 2012. The plan submitted in December 2012 was in response to the Staff's notice that the Company was not in compliance with the Exchange's continued listing requirement set forth in Section 1003(a)(iii) of the NYSE MKT Company Guide. This rule requires a listed company to have stockholders' equity of at least $6,000,000 if it has experienced net losses in its five most recent fiscal years. In connection with accepting the Company's compliance plan, the Exchange has granted the Company an extension until October 14, 2013 to regain compliance with the $6,000,000 stockholders' equity requirement. During the extension period, the Company will be subject to periodic review by the Staff of the Exchange. The failure by the Company to make progress consistent with the accepted plan or to regain compliance with the continued listing standards by the end of the extension period could result in the Company being delisted from the Exchange. In addition to the foregoing, the Company expects to receive notice from the Exchange that it does not satisfy the $4,000,000 stockholders' equity requirement set forth in Section 1003(a)(ii) of the NYSE MKT Company Guide following the filing of its Form 10- Q for the quarterly period ended December 31, 2012, since it experienced net losses in three of its most recent four fiscal years. The Company anticipated this when it submitted its compliance plan and designed the compliance plan, which has now been accepted, to address its non-compliance with both the $6,000,000 and $4,000,000 stockholders' equity requirements. About iBio, Inc. Based in Newark, Del., iBio, Inc., is a biotechnology company focused on commercializing its proprietary technologies, the iBioLaunch(TM) platform for vaccines and therapeutic proteins, as well as the iBioModulator(TM) platform for vaccine enhancement. * * * As reported in the TCR on Oct. 16, 2012, CohnReznick LLP, in Eatontown, N.J., expressed substantial doubt about iBio's ability to continue as a going concern. The independent auditors noted that the Company has incurred net losses and negative cash flows from operating activities for the years ended June 30, 2012, and 2011 and has an accumulated deficit as of June 30, 2012. INTERACTIVE DATA: Moody's Rates $1.3-Bil. Refinanced Debt 'Ba3' --------------------------------------------------------------- Moody's Investor Service assigned a Ba3 rating to Interactive Data Corporation's $1.305 billion refinanced senior secured term loan due 2018. IDCO utilized the proceeds to refinance its existing $1.3 billion term loan as part of a re-pricing that will favorably reduce annual cash interest expense by approximately $10 million. The rating assignment does not affect Igloo Holding Corporation's (Igloo; IDCO's indirect parent) B2 Corporate Family Rating (CFR), B2-PD Probability of Default Rating, SGL-2 speculative-grade liquidity rating, or the other debt instrument ratings and stable rating outlook of Igloo and IDCO. The reduction in cash interest as part of the refinancing favorably improves free cash flow. Moody's nevertheless expects Igloo/IDCO will utilize the incremental cash flow for organic development, modestly sized acquisitions, and for equity sponsor distributions with debt reduction limited to the 1% required annual term loan amortization and the 50% excess cash flow sweep (the sweep percentage steps down to 25% if leverage as defined in the credit agreement is at or below 4.75x and 0% if leverage is at or below 4x; the lenders may decline future ECF sweeps). The ratio is measured based on net debt at IDCO and is estimated to be 5.0x at 9/30/12 factoring in the $100 million use of case for the December 2012 shareholder distribution. Total debt increases by less than $3 million, and there are no other material changes to the prior credit facility terms including the guarantee and collateral package, financial maintenance covenants, or February 11, 2018 term loan maturity date. The rating on the prior term loan was withdrawn since it was redeemed in conjunction with the refinancing. Assignments: Issuer: Interactive Data Corporation Senior Secured Bank Credit Facility ($1.305 billion term loan due February 2018), Assigned Ba3, LGD2 - 26% Withdrawals: Issuer: Interactive Data Corporation Senior Secured Bank Credit Facility (original $1.345 billion term loan due February 2018), previously rated Ba3, LGD2 - 26% Ratings Rationale: Igloo's B2 CFR reflects its good market position in fixed income evaluated pricing and reference data services for financial institutions, tempered by high debt-to-EBITDA leverage, and event risks related to acquisitions, cash distributions or other leveraging actions by the equity sponsors. The company's broad coverage of and evaluated pricing capabilities for a variety of securities, global data collection infrastructure, good customer and geographic diversity and a high percentage of recurring revenue contribute to its market position and good cash flow generation. The importance of the company's pricing and reference data content and services to daily net asset value calculations for a wide range of money management firms as well as limited exposure to primary market new issuance activity dampens the magnitude of cyclical revenue volatility notwithstanding that earnings of its primary customers are cyclical. A good liquidity position provides the company flexibility to manage efforts by its customers to streamline costs due to pressures from an uncertain economic environment and increasing regulatory burdens. Igloo's debt-to-EBITDA leverage (approximately 7.3x LTM 9/30/12 incorporating Moody's standard adjustments and the December 2012 bond offering to fund a distribution to equity sponsors) is likely to remain high in 2013 as the company continues to fund investments in product development and technical infrastructure including the completion of a unified technology platform project. Moody's projects Igloo's debt-to-EBITDA leverage will drop to a mid 6x range in 2014 primarily due to low single digit revenue growth and cost savings and efficiencies generated from the company's various infrastructure investments. Exposure to Europe (25% of revenue, according to IDCO's 2011 Form 10-K) is a drag in the near term given weak economic conditions. Moody's believes this will contribute to low single digit percentage revenue growth in 2013 and 2014 (vs. the approximate 4.6% average organic revenue increase for 2008-2012). The stable rating outlook reflects Moody's expectation that Igloo will maintain a good liquidity position, generate modest revenue growth, and maintain positive free cash flow. Moody's anticipates the company will utilize free cash flow for modest debt reduction (via the excess cash flow sweep and required term loan amortization), reinvestment through organic development and modestly sized acquisitions and to create capacity for distributions to equity sponsors over time. Moody's expects Igloo's debt-to-EBITDA leverage will decline to a mid 6x range in 2014 and that it will refrain from large debt financed acquisitions and shareholder distributions for the next 18-24 months. Downward rating pressure could occur if Igloo is unable to reduce and maintain debt-to-EBITDA below 7x or if further debt financed acquisitions and shareholder distributions occur. A decline in the company's earnings resulting from reduced client spending, client losses, or a prolonged economic downturn could pressure the rating. Igloo's ratings could also be downgraded if liquidity deteriorates. Igloo could be positioned for an upgrade if it maintains a good liquidity position, generates consistent revenue growth and solid free cash flow, and demonstrates the willingness and ability to sustain debt-to-EBITDA leverage comfortably below 6.0x and free cash flow-to-debt above 5%. Igloo's and IDCO's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Igloo's and IDCO's core industry and believes Igloo's and IDCO's ratings are comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Igloo/IDCO, headquartered in Bedford, Massachusetts, is a provider of financial market data, analytics and related solutions to financial institutions and active traders, as well as software and service providers. Affiliates of Silver Lake Technology Management L.L.C. and Warburg Pincus LLC (the equity sponsors) acquired IDCO on July 29, 2010 for a purchase price of approximately $3.7 billion (including transaction fees and expenses). Revenue for the LTM ended September 2012 was approximately $878 million. ISTAR FINANCIAL: Vanguard Group Discloses 5.1% Equity Stake ----------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, The Vanguard Group disclosed that, as of Dec. 31, 2012, it beneficially owns 4,239,013 shares common stock of iStar Financial Inc. representing 5.06% of the shares outstanding. Vanguard Group previously reported beneficial ownership of 4,233,509 common shares or a 5.16% equity stake as of Dec. 31, 2011. A copy of the amended filing is available at: http://is.gd/mVkIry About iStar Financial New York-based iStar Financial Inc. (NYSE: SFI) provides custom- tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust, provides innovative and value added financing solutions to its customers. The Company reported a net loss of $25.69 million in 2011, compared with net income of $80.20 million in 2010. iStar Financial's balance sheet at Sept. 30, 2012, showed $6.94 billion in total assets, $5.52 billion in total liabilities, $14.20 million in redeemable noncontrolling interests, and $1.40 billion in total equity. * * * In March 2012, Fitch affirmed the company's 'B-' issuer default rating. The IDR affirmation is based on a manageable debt maturity profile of the company, pro forma for the recently- consummated secured financing that extends certain of the company's debt maturities, relieving the overhang of significant unsecured debt maturities in 2012 and 2013. While this 2012 financing does not reduce the amount of total debt outstanding, the company's debt maturity profile is more manageable over the next two years, with only 48% of debt maturing pro forma, down from 61%. Given the mild improvement in commercial real estate fundamentals and value stabilization, the company's loan and real estate owned portfolio performance will likely improve going forward, which should increase the company's ability to repay upcoming indebtedness. As reported by the TCR on Oct. 5, 2012, Standard & Poor's Ratings Services affirmed its 'B+' long-term issuer credit rating on iStar Financial Inc. In October 2012, Moody's Investors Service upgraded the corporate family rating to B2 from B3. The current rating reflects the REIT's success in extending near term debt maturities and improving fundamentals in commercial real estate. The ratings on the October 2012 senior secured credit facility takes into account the asset coverage, the size and quality of the collateral pool, and the term of facility. J&J DEVELOPMENTS: Can Hire Jimmie Taylor as Realtors ---------------------------------------------------- J & J Developments Inc. sought and obtained approval from the U.S. Bankruptcy Court to employ Jimmie Taylor Realtors to sell real properties on the Debtor's behalf. The firm will be paid a fee commission of 6% of the sale of the real property. James L. Taylor attests his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About J & J Developments J & J Developments Inc. is a real estate holding company holding title to real estate in more than 20 locations in Kansas. Many of those locations contain convenience stores. J & J Developments filed a Chapter 11 petition (Bankr. D. Kan. Case No. 12-11881) in Wichita, Kansas, on July 12, 2012. John E. Brown signed the petition as president and chief executive officer. The Debtor is represented by Edward J. Nazar, Esq., at Redmond & Nazar, LLP, in Wichita, Kansas. Judge Robert E. Nugent presides over the case. According to the petition, the Debtor has scheduled assets of $18.7 million and scheduled liabilities of $34,933. JAMES RIVER: BlackRock Lowers Equity Stake to 5.3% -------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, BlackRock, Inc., disclosed that, as of Dec. 31, 2012, it beneficially owns 1,889,089 shares of common stock of James River Coal Co. representing 5.26% of the shares outstanding. BlackRock previously reported beneficial ownership of 2,275,988 common shares or a 6.33% equity stake as of June 29, 2012. A copy of the amended filing is available at: http://is.gd/iuiaqz About James River Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. The Company reported a net loss of $39.08 million in 2011, compared with net income of $78.16 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $1.28 billion in total assets, $947.34 million in total liabilities and $341.87 million in total shareholders' equity. * * * In the Dec. 6, 2012, edition of the TCR, Moody's Investors Service downgraded James River Coal Company's Corporate Family Rating ("CFR") and Probability of Default Rating ("PDR") to Caa1 from B3. The downgrades reflects weakening credit protection metrics as a result of a very difficult environment facing coal producers in Central Appalachia and Moody's view that the company's earnings and cash flow profile will remain challenged in the near-term. As reported by the TCR on Nov. 19, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Richmond, Va.-based James River Coal Co. to 'CCC' from 'SD' (selective default). "We raised our rating on James River Coal because we understand that the company has stopped repurchasing its debt at deep discounts, for the time being," said credit analyst Megan Johnston. JAMES RIVER: Vanguard Group Reports 5.9% Equity Stake ----------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, The Vanguard Group disclosed that, as of Dec. 31, 2012, it beneficially owns 2,120,609 shares of common stock of James River Coal Co. representing 5.9% of the shares outstanding. Vanguard Group previously reported beneficial ownership of 1,844,974 common shares or a 5.17% equity stake as of Dec. 31, 2011. A copy of the amended filing is available at: http://is.gd/HGVYIj About James River Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. The Company reported a net loss of $39.08 million in 2011, compared with net income of $78.16 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $1.28 billion in total assets, $947.34 million in total liabilities and $341.87 million in total shareholders' equity. * * * In the Dec. 6, 2012, edition of the TCR, Moody's Investors Service downgraded James River Coal Company's Corporate Family Rating ("CFR") and Probability of Default Rating ("PDR") to Caa1 from B3. The downgrades reflects weakening credit protection metrics as a result of a very difficult environment facing coal producers in Central Appalachia and Moody's view that the company's earnings and cash flow profile will remain challenged in the near-term. As reported by the TCR on Nov. 19, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Richmond, Va.-based James River Coal Co. to 'CCC' from 'SD' (selective default). "We raised our rating on James River Coal because we understand that the company has stopped repurchasing its debt at deep discounts, for the time being," said credit analyst Megan Johnston. JOHN PATRICK STOKES: Fails to Dismiss Duncan-Glover Suit -------------------------------------------------------- Bankruptcy Judge Ralph B. Kirscher denied the request of debtor John Patrick Stokes to dismiss a lawsuit filed against him by Gregory Duncan and Kathleen M. Glover. Trial in the case is scheduled to begin March 7, 2013. Judge Kirscher said the Plaintiffs' petition for declaratory judgment is a core proceeding under 28 U.S.C. Sec. 157(b)(2)(A) & (2)(O) concerning the administration of the Debtor's estate and/or other proceeding affecting the liquidation of assets of the estate; and under 11 U.S.C. Sec. 105(a) to enforce or implement the Bankruptcy Court's Order approving the sale of the estate's state law claims in a case pending before the Montana First Judicial District Court, Lewis and Clark County. The lawsuit is, GREGORY DUNCAN and KATHLEEN M. GLOVER, Plaintiffs. v. JOHN PATRICK STOKES, Defendant, Adv. Proc. No. 12-00052 (Bankr. D. Mont.). A copy of the Court's Feb. 8, 2013 Memorandum of Decision is available at http://is.gd/0MaCjlfrom Leagle.com. In February 2009, Mr. Stokes retained Mr. Duncan as his attorney to help him petition for Chapter 11 bankruptcy. On March 4, 2009, Mr. Stokes commenced Chapter 11 bankruptcy (Bankr. D. Mont. Case No. 09-60265). On June 5, 2009, Mr. Duncan petitioned the Bankruptcy Court to withdraw as Mr. Stokes's counsel. On June 18, 2009, Mr. Duncan's motion to withdraw was granted. On Sept. 21, 2009, Richard J. Samson was appointed to serve as the Trustee of the bankruptcy case. On the same date, on Mr. Samson's motion, Mr. Stokes' bankruptcy case was converted to a Chapter 7 proceeding. JOURNAL REGISTER: Halts Auction for $122-Mil. Stalking Horse Deal ----------------------------------------------------------------- Journal Register Co. announced Tuesday that it had scrapped Friday's scheduled bankruptcy auction due to lack of interest and would seek court approval for its sale to $122 million stalking- horse bidder, a unit of hedge fund Alden Global Capital LLC. Jamie Santo of BankruptcyLaw360 reported that JRC filed the cancellation notice in New York bankruptcy court after no qualified bidders emerged by the Monday afternoon deadline to challenge stalking horse 21st CMH Acquisition Co., whose offer is primarily based on debts held by other Alden units. About Journal Register Journal Register Company -- http://www.JournalRegister.com/-- is the publisher of the New Haven Register and other papers in 10 states, including Philadelphia, Detroit and Cleveland, and in upstate New York. The Company's more than 350 multi-platform products reach an audience of 21 million people each month. JRC is managed by Digital First Media and is affiliated with MediaNews Group, Inc., the nation's second largest newspaper company as measured by circulation. Journal Register, along with its affiliates, first filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 09-10769) on Feb. 21, 2009. Attorneys at Willkie Farr & Gallagher LLP, served as counsel to the Debtors. Attorneys at Otterbourg, Steindler, Houston & Rosen, P.C., represented the official committee of unsecured creditors. Journal Register emerged from Chapter 11 protection under the terms of a pre-negotiated plan. Journal Register returned to bankruptcy (Bankr. S.D.N.Y. Lead Case No. 12-13774) on Sept. 5, 2012, to sell the business to 21st CMH Acquisition Co., an affiliate of funds managed by Alden Global Capital LLC. The deal is subject to higher and better offers. Journal Register exited the 2009 restructuring with $225 million in debt and with a legacy cost structure, which includes leases, defined benefit pensions and other liabilities that have become unsustainable and threatened the Company's efforts for a successful digital transformation. Journal Register managed to reduce the debt by 28% with the Company servicing in excess of $160 million of debt. Alden Global is the holder of two terms loans totaling $152.3 million. Alden Global acquired the stock and the term loans from lenders in Journal Register's prior bankruptcy. Journal Register disclosed total assets of $235 million and liabilities totaling $268.6 million as of July 29, 2012. This includes $13.2 million owing on a revolving credit to Wells Fargo Bank NA. Bankruptcy Judge Stuart M. Bernstein presides over the 2012 case. Neil E. Herman, Esq., Rachel Jaffe Mauceri, Esq., and Patrick D. Fleming, Esq., at Morgan, Lewis & Bockius, LLP; and Michael R. Nestor, Esq., Kenneth J. Enos, Esq., and Andrew L. Magaziner, Esq., at Young Conaway Stargatt & Taylor LLP, serve as the 2012 Debtors' counsel. SSG Capital Advisors, LLC, serves as financial advisors. American Legal Claims Services LLC acts as claims agent. The petition was signed by William Higginson, executive vice president of operations. Otterbourg, Steindler, Houston & Rosen, P.C., represents Wells Fargo. Akin, Gump, Strauss, Hauer & Feld LLP, represents the Debtors' Tranche A Lenders and Tranche B Lenders. Emmet, Marvin & Martin LLP, serves as counsel to Wells Fargo, in its capacity as Tranche A Agent and the Tranche B Agent. The Official Committee of Unsecured Creditors appointed in the case has retained Lowenstein Sandler PC as counsel and FTI Consulting, Inc. as financial advisor. K-V PHARMACEUTICAL: Noteholders Have No Lien on Makena Drug ----------------------------------------------------------- Bankruptcy Judge Allan L. Gropper granted the motion of the Official Committee of Unsecured Creditors for a declaration that the prepetition senior noteholders were not granted a lien on certain assets of K-V Discovery Solutions, Inc. The dispute involves the rights that the Secured Noteholders have under $225 million in Senior Secured Notes. The Secured Noteholders claim (A) that they have a security interest in all rights relating to the drug known as Makena other than (i) the Makena trademark and (ii) the Debtors' executory rights as of the petition date arising under the agreement for the purchase of the drug, or (B) at least that the underlying documents are ambiguous and the rights of the parties cannot be established without a full trial. The Committee, asserting the interests of the Debtors' estate, claims that the Secured Noteholders do not have a prepetition security interest in the Debtors' right, title, and interest in Makena. In a Feb. 11 Memorandum of Decision available at http://is.gd/920QRFfrom Leagle.com, Judge Gropper said it is evident that the documents governing the Senior Notes did not provide the Secured Noteholders with a prepetition lien on the Debtors' right, title, or interest in Makena and the Makena Agreement, other than the Makena Inventory and Receivables. The documents contain no ambiguities that either require or permit the consideration of parole evidence. Judge Gropper added, however, that nothing in his decision bears on the question whether the holders of the Notes, or some of them, have a lien on the drug Makena by virtue of a grant of adequate protection to secure them against a diminution in the value of their collateral during the course of the chapter 11 cases, or whether they have a lien as security for a DIP Loan made during the course of the chapter 11 cases. The only question raised is the extent of the prepetition security interest held by the Secured Noteholders. About K-V Pharmaceutical K-V Pharmaceutical Company (NYSE: KVa/KVb) -- http://www.kvpharmaceutical.com/-- is a fully integrated specialty pharmaceutical company that develops, manufactures, markets, and acquires technology-distinguished branded and generic/non-branded prescription pharmaceutical products. The Company markets its technology distinguished products through ETHEX Corporation, a subsidiary that competes with branded products, and Ther-Rx Corporation, the company's branded drug subsidiary. K-V Pharmaceutical Company and certain domestic subsidiaries on Aug. 4, 2012, filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-13346, under K-V Discovery Solutions Inc.) to restructure their financial obligations. K-V employed Willkie Farr & Gallagher LLP as bankruptcy counsel, Williams & Connolly LLP as special litigation counsel, and SNR Denton as special litigation counsel. In addition, K-V tapped Jefferies & Co., Inc., as financial advisor and investment banker. Epiq Bankruptcy Solutions LLC is the claims and notice agent. The U.S. Trustee appointed five members to serve in the Official Committee of Unsecured Creditors. Kristopher M. Hansen, Esq., Erez E. Gilad, Esq., and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, represent the Creditors Committee. Steven J. Reisman, Esq., and Turner P. Smith, Esq., at Curtis, Mallet- Prevost, Colt & Mosle, LLP, serve as Conflict Counsel for the Committee. Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R. Fife, Esq., represent an Ad Hoc Senior Noteholders Group. Alston & Bird LLP's David A. Wender, Esq., and Jack W. Spears, Esq., argue for Wilmington Trust National Association, as Senior Indenture Trustee and Collateral Agent. LEHMAN BROTHERS: To Sell Park Avenue Property for More Than $800MM ------------------------------------------------------------------ Eliot Brown at Daily Bankruptcy Review reports Lehman Brothers Holdings Inc. has agreed to sell the Manhattan office tower at 237 Park Ave. to a venture of RXR Realty LLC and Walton Street Capital in what would be one of the largest sales in Manhattan in the past year. 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) LOCATION BASED TECHNOLOGIES: Jeffrey Devlin Named to Board ---------------------------------------------------------- The Board of Directors of Location Based Technologies, Inc., appointed Mr. Jeffrey Devlin as a director effective Feb. 7, 2013. For his service, Mr. Devlin will receive 50,000 shares of restricted common stock on March 1, 2013. Mr. Devlin will be assigned to committees at the Board's next scheduled meeting. About Location Based Technologies Irvine, Calif.-based Location Based Technologies, Inc., designs, develops, and sells leading-edge personal locator devices and services. Comiskey & Company, the Company's independent registered public accounting firm, included an explanatory paragraph in its report on the Company's financial statements for the fiscal year ended Aug. 31, 2012, which expresses substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has incurred recurring losses since inception and has an accumulated deficit in excess of $45,000,000. There is minimal sales history for the Company's products, which are new to the marketplace. The Company's balance sheet at Nov. 30, 2012, showed $4.72 million in total assets, $7.35 million in total liabilities and a $2.62 million total stockholders' deficit. MACCO PROPERTIES: Kevin Coffey Withdraws as Counsel for MA Cedar ---------------------------------------------------------------- Debtor MA Cedar Lake Apartments, LLC, a debtor-affiliate of Macco Properties, Inc., asks the Bankruptcy court to permit the withdrawal of Kevin M. Coffey as its counsel. According to papers filed with the Court, on Dec. 17, 2012, three days following the filing of Mr. Coffey, as counsel for MA Cedar, of a response to Jennifer Price's renewed motion to dismiss MA Cedar Lake Apartment's Chapter 11 case, adopting MA Cedar's previous objection to Ms. Price's original motion for conditional order of dismissal, Ms. Price advised Mr. Coffey to withdraw the response immediately, and further advised Mr. Coffey "that if such response was not withdrawn immediately, the Debtor-in-Possession, apparently through Ms. Price, would have no choice but to exercise all available remedies against Mr. Coffey, beginning with the filing of a bar complaint with the Oklahoma Bar Association." Since receiving the correspondence from Ms. Price, attorney for Ms. Price, Mark Sanders, has advised Mr. Coffey that the law firm of Gable & Gotwals, P.C., will apply to the Court to approve the law firm as replacement counsel for the Debtor-in-Possession. About Macco Properties Oklahoma City, Oklahoma-based Macco Properties, Inc., is a property management company that is the sole or controlling member and/or manager of numerous multi-family residential rental units in Oklahoma City, Oklahoma, Wichita, Kansas, and Dallas, Texas, and several and commercial business properties in Oklahoma City, Oklahoma, and Holbrook, Arizona. The Company filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 10-16682) on Nov. 2, 2010. The Debtor disclosed $50,823,581 in total assets, and $4,323,034 in total liabilities. Receivership Services Corp., a division of the Martens Cos., serves as property manager for the six Wichita apartment complexes caught up in the bankruptcy of Macco Properties of Oklahoma City. Michael E. Deeba, the Chapter 11 trustee, is represented by Christopher T. Stein, of counsel to the firm of Bellingham & Loyd, P.C. Grubb & Ellis/Martens Commercial Group LLC, to act as the Chapter 11 Trustee's exclusive listing broker/realtor for properties. The trustee wants to real estate holdings wants to sell some of the property off, including a luxury high-rise condominium in Dallas valued at more than $2.5 million and several run-down apartment complexes in the metro area. The Official Unsecured Creditors' Committee is represented by Ruston C. Welch, at Welch Law Firm, P.C., in Oklahoma City, Oklahoma. MACCO PROPERTIES: UST & Committee Still Object at 5th Attempt ------------------------------------------------------------- The United States Trustee and the Official Committee of Unsecured Creditors have objected to equity security holder Jennifer Price's proposed disclosure statement explaining her Fifth Amended Plan of Reorganization for Macco Properties, Inc., et al., dated Dec. 21, 2012. According to the U.S. Trustee, this is Ms. Price's fifth attempt to provide a disclosure statement with adequate information to permit creditors to make an informed decision as to whether they want to continue a relationship with the Price and McGinnis management team. "Price and McGinnis are no different today than they were at the commencement of this case. Recent events continue to provide examples of their improper conduct." Charles S. Glidewell, the Assistant U.S. Trustee, says that without financial information, creditors cannot determine whether the proposed plan is beneficial or feasible. "Parties in interest have no information to determine what has been accomplished while this estate has been administered under Chapter 11. It may be that conversion of this estate to Chapter 7 makes more sense. Furthermore, the lack of a liquidation analysis compounds the lack of financial information." "Failure to disclose litigation specifics may preclude the Debtor from pursuing litigation post-confirmation." The Committee says that without a confirmed commitment, free of contingencies, creditors are left with nothing short of "empty promises" that they will be paid at some point in the future. According to papers filed with the Court, the Fifth Plan has gone from requiring funding of $5 million (letter of credit to be opened by NBC Bank for the account of Consolidated Capital Investments, LLC, to Macco) to over $20 million (line of credit to be established by Edward Snyder). The Committee points out, however, that the alleged confirmation of commitment from Mr. Snyder omits the necessary and required terms to form a contract to be enforeceable and that the disclosure statement is void of any material information on Mr. Snyder, including whether he has the financial means and ability to meet the funding commitment. A copy of the UST's objection to the Price Fifth Amended Disclosure Statement is available at: http://bankrupt.com/misc/macco.doc1388.pdf A copy of the Committee's objection is available at: http://bankrupt.com/misc/macco.doc1390.pdf A copy of Price's Fifth Amended Disclosure Statement is available at http://bankrupt.com/misc/macco.doc1383.pdf About Macco Properties Oklahoma City, Oklahoma-based Macco Properties, Inc., is a property management company that is the sole or controlling member and/or manager of numerous multi-family residential rental units in Oklahoma City, Oklahoma, Wichita, Kansas, and Dallas, Texas, and several and commercial business properties in Oklahoma City, Oklahoma, and Holbrook, Arizona. The Company filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 10-16682) on Nov. 2, 2010. The Debtor disclosed $50,823,581 in total assets, and $4,323,034 in total liabilities. Receivership Services Corp., a division of the Martens Cos., serves as property manager for the six Wichita apartment complexes caught up in the bankruptcy of Macco Properties of Oklahoma City. Michael E. Deeba, the Chapter 11 trustee, is represented by Christopher T. Stein, of counsel to the firm of Bellingham & Loyd, P.C. Grubb & Ellis/Martens Commercial Group LLC, to act as the Chapter 11 Trustee's exclusive listing broker/realtor for properties. The trustee wants to real estate holdings wants to sell some of the property off, including a luxury high-rise condominium in Dallas valued at more than $2.5 million and several run-down apartment complexes in the metro area. The Official Unsecured Creditors' Committee is represented by Ruston C. Welch, at Welch Law Firm, P.C., in Oklahoma City, Oklahoma. MARIANA BRACETTI: S&P Lowers Rating on 2011 Revenue Bonds to 'BB' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating to 'BB' from 'BBB-' on Philadelphia Authority for Industrial Development, Pa.'s series 2011 revenue bonds, issued for the MarianaBracetti Academy (MBA) Charter School. The outlook is stable. "The lowered rating reflects our view of increased risks on multiple fronts: a decrease in per-pupil funding; a significant increase in project costs, with increased use of reserves and fund balances; below 1.0x maximum annual debt service coverage per our calculations, not including reserves; and $24 million of debt," said Standard & Poor's credit analyst Carlotta Mills. "Although enrollment increased, and was funded by the state this year, MBA currently enrolls more students than its charter allows, potentially putting its charter at risk. However, management has continued to plan prudently and is mindful of its bond covenants," continued Ms. Mills. The rating reflects S&P's view of: -- Significant scope change and cost overruns to the school's project, which has resulted in accelerated and increased use of fund balances as well as a use of operating reserves; -- The risk that the charter may not be renewed, as with all charter schools, especially as the school has surpassed its authorized enrollment cap; -- The school's inability to meet Adequate Yearly Progress results in 2012; and -- Project delay and extended relocation risk. MAUI LAND: ValueWorks Discloses 7% Equity Stake ----------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, ValueWorks, LLC, and Charles Lemonides disclosed that, as of Dec. 31, 2012, they beneficially own 1,323,401 shares of common stock of Maui Land & Pineapple Company, Inc., representing 7.05% of the shares outstanding. ValueWorks previously reported beneficial ownership of 1,343,747 common shares or 7.14% equity stake as of Dec. 31, 2011. A copy of the amended filing is available for free http://is.gd/hPaLD9 About Maui Land & Pineapple Co. Maui Land & Pineapple Company, Inc. (NYSE: MLP) -- http://mauiland.com/-- develops, sells, and manages residential, resort, commercial, and industrial real estate. The Company owns approximately 23,000 acres of land on Maui and operates retail, utility operations, and a nature preserve at the Kapalua Resort. The Company's principal subsidiary is Kapalua Land Company, Ltd., the operator and developer of Kapalua Resort, a master-planned community in West Maui. Following the financial results for the year ended Dec. 31, 2011, the Company's independent auditors expressed substantial doubt about the Company's ability to continue as a going concern. Deloitte & Touche LLP, in Honolulu, Hawaii, noted that the Company's recurring negative cash flows from operations and deficiency in stockholders' equity raise substantial doubt about the Company's ability to continue as a going concern. The Company's balance sheet at Sept. 30, 2012, showed $61.44 million in total assets, $89.62 million in total liabilities and a $28.17 million stockholders' deficiency. MCCLATCHY CO: Dimensional Fund Owns 6.3% of Class A Shares ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 3,821,715 Class A shares of McClatchy Co. representing 6.26% of the shares outstanding. A copy of the filing is available at http://is.gd/WtV9rF About The McClatchy Company Sacramento, Calif.-based The McClatchy Company (NYSE: MNI) -- http://www.mcclatchy.com/-- is the third largest newspaper company in the United States, publishing 30 daily newspapers, 43 non-dailies, and direct marketing and direct mail operations. McClatchy also operates leading local Web sites in each of its markets which extend its audience reach. The Web sites offer users comprehensive news and information, advertising, e-commerce and other services. Together with its newspapers and direct marketing products, these interactive operations make McClatchy the leading local media company in each of its premium high growth markets. McClatchy-owned newspapers include The Miami Herald, The Sacramento Bee, the Fort Worth Star-Telegram, The Kansas City Star, The Charlotte Observer, and The News & Observer (Raleigh). The Company's balance sheet at Sept. 23, 2012, showed $2.88 billion in total assets, $2.67 billion in total liabilities, and $210.29 million in stockholders' equity. * * * McClatchy carries a 'Caa1' corporate family rating from Moody's Investors Service. In May 2011, Moody's changed the rating outlook from stable to positive following the company's announcement that it closed on the sale of land in Miami for $236 million. The outlook change reflects Moody's expectation that McClatchy will utilize the net proceeds to reduce debt, including its underfunded pension position, which will reduce leverage by approximately half a turn and lower required contributions to the pension plan over the next few years. McClatchy Co. carries a 'B-' Corporate Credit Rating from Standard & Poor's Ratings Services. MEDIA GENERAL: Dimensional Fund Owns 4.9% of Class A Shares ----------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 1,366,049 Class A shares of Media General Inc. representing 4.99% of the shares outstanding. Dimensional Fund previously reported beneficial ownership of 1,460,005 Class A shares. A copy of the amended filing is available for free at http://is.gd/m1FfH0 About Media General Richmond, Virginia-based Media General Inc. (NYSE: MEG) -- http://www.mediageneral.com/-- is an independent communications company with interests in newspapers, television stations and interactive media in the United States. The Company incurred a net loss of $193.41 million in for the year ended Dec. 31, 2012, a net loss of $74.32 million for the year ended Dec. 25, 2011, and a net loss of $22.63 million for the fiscal year ended Dec. 26, 2010. The Company's balance sheet at Dec. 31, 2012, showed $773.42 million in total assets, $949.64 million in total liabilities and a $176.22 million stockholders deficit. * * * As reported by the Troubled Company Reporter on April 12, 2012, Moody's Investors Service downgraded, among other things, Media General's Corporate Family Rating (CFR) and Probability of Default Rating (PDR) to Caa1 from B3, concluding the review for downgrade initiated on Feb. 13, 2012. The downgrade reflects the significant increase in interest expense associated with the company's credit facility amend and extend transaction and an assumed issuance of at least $225 million of new notes, which will result in limited free cash flow generation and constrain Media General's capacity to reduce its very high leverage. The weak free cash flow and high leverage create vulnerability to changes in the company's highly cyclical revenue and EBITDA generation. In the Oct. 10, 2012, edition of the TCR, Standard & Poor's Ratings Services raised its rating on Richmond, Va.-based Media General Inc. to 'B-' from 'CCC+' and removed it from CreditWatch, where it was placed with positive implications on May 18, 2012. "The corporate credit rating on Media General is based on our expectation that the company will be able to maintain adequate liquidity despite its very high leverage," noted Standard & Poor's credit analyst Jeanne Shoesmith. MEDICAL INTERNATIONAL: Incurs $256,000 Net Loss in Dec. 31 Qtr. --------------------------------------------------------------- Medical International Technology, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $256,149 on $113,621 of sales for the three months ended Dec. 31, 2012, as compared with a net loss of $235,153 on $74,836 of sales for the same period a year ago. The Company's balance sheet at Dec. 31, 2012, showed $795,087 in total assets, $1.73 million in total liabilities and a $943,596 total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/cGBDlq About Medical International Montreal, Canada-based Medical International Technology, Inc., specializes in production, marketing and the sale of needle-free jet injector products designed for humans and animals, for single and mass injections. The Company reported a net loss of US$109,993 on US$996,434 of revenues in fiscal 2012, compared with a net loss of US$643,439 on US$437,378 of revenues in fiscal 2011. Ps Stephenson & Co., P.C., in Wharton, Texas, expressed substantial doubt about Medical International's ability to continue as a going concern following the financial results for the fiscal year ended Sept. 30, 2012. The independent auditors noted that the Company has suffered recurring losses from operations and has a working capital deficiency. MF GLOBAL: Adds Language to Plan Outline to Resolve Objections -------------------------------------------------------------- The trustee for MF Global Holdings Ltd. revised the disclosure statement for the proposed liquidation plan ahead of the hearing scheduled today, Feb. 14. MF Global Trustee Louis Freeh, along with a group of creditors that includes Barclays Capital and Citigroup Global Markets Inc., proposed Chapter 11 Plan that proposes to unsecured creditors as much as 34 cents on the dollar. A lawyer for the trustee said the plan proponents "fully anticipate" that they have resolved most of the issues raised by JPMorgan Chase Bank, N.A. and other parties through the language added to the outline or the so-called disclosure statement. A summary of the language added to the disclosure statement to address each of the objections can be accessed for free at http://is.gd/kuqEqZ "The plan proponents believe that the objections should be overruled or considered at the confirmation hearing, if they are not resolved prior to that hearing," said Brett Miller, Esq., at Morrison & Foerster LLP, in New York. Full-text copies of the Revised Disclosure Statement and Liquidation Plan are available for free at: http://bankrupt.com/misc/MFGlobal_RevisedPlan.pdf http://bankrupt.com/misc/MFGlobal_RevisedDS.pdf JPMorgan filed an objection earlier, saying the liquidation plan fails to take into account that MF Global's finance unit is being hit twice for the same debt, undercutting what some creditors might recover, according to a Feb. 8 report by Tom Hals of news agency Reuters. An agent and lender under the finance unit's $1.2 billion liquidity facility, JPMorgan said creditors of the finance unit could get up to 47.7% of their money if the double liability were voided. That is more than the maximum 33.6% that those creditors would receive under the plan, according to the report. The disputed double liability stems from $931 million that was borrowed under a liquidity facility in the days leading up to MF Global's bankruptcy in October 2011. About MF Global New York-based MF Global (NYSE: MF) -- http://www.mfglobal.com/-- is one of the world's leading brokers of commodities and listed derivatives. MF Global provides access to more than 70 exchanges around the world. The firm is also one of 22 primary dealers authorized to trade U.S. government securities with the Federal Reserve Bank of New York. MF Global's roots go back nearly 230 years to a sugar brokerage on the banks of the Thames River in London. MF Global Holdings Ltd. and MF Global Finance USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059 and 11-5058) on Oct. 31, 2011, after a planned sale to Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF Global had $41,046,594,000 in total assets and $39,683,915,000 in total liabilities. It is easily the largest bankruptcy filing so far this year. Judge Honorable Martin Glenn presides over the Chapter 11 case. J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve as bankruptcy counsel. The Garden City Group, Inc., serves as claims and noticing agent. The petition was signed by Bradley I. Abelow, Executive Vice President and Chief Executive Officer of MF Global Finance USA Inc. The Securities Investor Protection Corporation commenced liquidation proceedings against MF Global Inc. to protect customers. James W. Giddens was appointed as trustee pursuant to the Securities Investor Protection Act. He is a partner at Hughes Hubbard & Reed LLP in New York. Jon Corzine, the former New Jersey governor and co-CEO of Goldman Sachs Group Inc., stepped down as chairman and chief executive officer of MF Global just days after the bankruptcy filing. U.S. regulators are investigating about $633 million missing from MF Global customer accounts, a person briefed on the matter said Nov. 3, according to Bloomberg News. Bankruptcy Creditors' Service, Inc., publishes MF GLOBAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by MF Global Holdings and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MF GLOBAL: Ch. 11 Objections Premature, Plan Proponents Say ----------------------------------------------------------- Brian Mahoney of BankruptcyLaw360 reported that proponents of MF Global Inc.'s Chapter 11 plan told a New York bankruptcy judge Tuesday that creditor objections to its disclosure statements were thinly veiled protests over the confirmation of the bankruptcy and should be overruled. The report related that MF Global's Chapter 11 trustee Louis J. Freeh, several MF Global subsidiaries and a group of so-called creditor co-proponents said that objections from Chapter 11 creditors JPMorgan Chase Bank NA and Sapere Wealth Management LLC raised issues related to the confirmability of MF Global's Chapter 11 and that such objections were premature at this juncture. 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. MILACRON HOLDINGS: S&P Puts 'B+' CCR on CreditWatch Negative ------------------------------------------------------------ Standard & Poor's Ratings Services said that it placed its ratings on Ohio-based Milacron Holdings Inc. on CreditWatch with negative implications. This includes the 'B+' corporate credit rating on Milacron Holdings Inc. as well as the 'B+' issue rating on subsidiary Milacron LLC's senior secured notes. This action follows the company's announcement that its subsidiary Milacron LLC has entered into a definitive agreement to acquire Moldmaster Ltd. for about C$975 million. "Although the acquisition enhances Milacron's global position in the plastic processing equipment industry and adds products with attractive margins to its portfolio, we anticipate that the company will largely fund the transaction with debt, likely resulting in a significant increase in leverage," said Standard & Poor's credit analyst Gregoire Buet. Although cash flow generation should provide some capacity for subsequent debt reduction, S&P believes prospective credit measures may deteriorate and remain outside of its expectations for the current 'B+' rating for a prolonged period. Those include debt to EBITDA of 4x-5x and funds from operations to debt of 10%-15%. S&P will resolve the CreditWatch listing after reviewing the details of the transaction, including the strategic reasons for the acquisition, operating performance prospects, cash flow generation, capital structure, and the deleveraging profile. S&P will also review how the mix of new secured and unsecured debt in the pro forma capital structure may affect recovery prospects on Milacron's existing senior secured notes. MILACRON HOLDINGS: Moody's Reviews B1 CFR for Possible Downgrade ---------------------------------------------------------------- Moody's Investors Service placed the B1 ratings of Milacron Holdings Inc. under review for possible downgrade. The action follows announcement of Milacron's agreement to purchase Mold- Masters Limited of Canada for CND975 million (approximately USD969 million). Milacron is wholly-owned by an affiliate of private equity firm CCMP Capital Advisors who acquired the business in 2012 in a leveraged transaction. Moody's assigned a B1 Corporate Family and B1-PD (Probability of Default) rating at that time as well as a B1 (LGD-4, 50%) rating to the $275 million secured note that was co- issued by Mcron Finance Sub LLC and Mcron Finance Corp. who subsequently merged with Milacron LLC. The notes have both a downstreamed guarantee from the parent, Milacron Holdings, Inc., and from Milacron LLC's material domestic operating subsidiaries. Ratings Rationale: By acquiring Mold-Masters, a manufacturer of hot runner systems, temperature controllers and auxiliary equipment used in the plastic industry with annual revenues of a CND271 million (USD268 million), Milacron will add a complementary set of products and services to its existing range of injection and extruding equipment, mold base systems, related tooling and metal working fluids. The combined entity is expected to have revenues in excess of $1 billion. However, the transaction is expected to involve a significant increase in Milacron's debt and related fixed charges and to close in the second quarter of 2013. The review will focus on the pro forma capital structure, earnings, cash flows, liquidity and coverage metrics of the combined organization. Ratings placed under review for possible downgrade: Milacron Holdings Inc. Corporate Family, B1 Probability of Default, B1-PD Milacron LLC $275 million secured note, B1, (LGD-4, 50%) The principal methodology used in this rating was the Global Heavy Manufacturing Rating Methodology published in November 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. Milacron Holdings Inc. through its wholly-owned subsidiary, Milacron LLC, headquartered in Cincinnati, OH, produces equipment used in plastics-processing industries as well as fluids used in metalworking industries. Revenues in 2011 exceeded $780 million. MONSEN ENGINEERING: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Monsen Engineering Company, Inc. 6 Daniel Road East Fairfield, NJ 07004-2547 Bankruptcy Case No.: 13-12683 Chapter 11 Petition Date: February 11, 2013 Court: United States Bankruptcy Court District of New Jersey (Newark) Judge: Novalyn L. Winfield Debtor's Counsel: Ilissa Churgin Hook, Esq. HOOK & FATOVICH, LLC 1430 Route 23 North Wayne, NJ 07470 Tel: (973) 686-3800 Fax: (973) 686-3801 E-mail: ihook@hookandfatovich.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/njb13-12683.pdf The petition was signed by Eric Monsen, principal and chairman of the board. MPG OFFICE: Sorin NL Owns 6.4% of Cumulative Preferred Shares ------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Sorin NL Fund, L.P., and its affiliates disclosed that, as of Dec. 31, 2012, they beneficially own 619,014 shares of 7.625% Series A Cumulative Redeemable Preferred Stock, $0.01 par value, of MPG Office Trust, Inc., representing 6.36% of the shares outstanding. A copy of the regulatory filing is available for free at http://is.gd/gmZvbd About MPG Office Trust MPG Office Trust, Inc., fka Maguire Properties Inc. -- http://www.mpgoffice.com/-- is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high- quality office properties in the Southern California market. MPG Office Trust is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. The Company has been focused on reducing debt, eliminating repayment and debt service guarantees, extending debt maturities and disposing of properties with negative cash flow. The first phase of the Company's restructuring efforts is substantially complete and resulted in the resolution of 18 assets, relieving the Company of approximately $2.0 billion of debt obligations and potential guaranties of approximately $150 million. The Company reported net income of $98.22 million in 2011, compared with a net loss of $197.93 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $1.86 billion in total assets, $2.59 billion in total liabilities, and a $729.16 million total deficit. NEW YORK WESTCHESTER: Must Close Sale by March 31 or Face Shutdown ------------------------------------------------------------------ Barbara Benson, writing for Crain's New York Business, reported that a bankruptcy court on Jan. 24 approved Montefiore Medical Center as the new owner of bankrupt New York Westchester Square Medical Center in Bronx, New York. An auction was held Jan. 23 for the hospital's assets. Montefiore's final bid was $15.3 million bid, raised from an earlier offer of about $14 million, prevailed. At the Jan. 24 hearing, the Court rejected a last minute bid by a group of real estate investors. Crain's noted that the medical center was slated to be shut down and reconfigured as an outpatient clinic. The report recounts a state commission mandated its closure by December 2008 but that was delayed by a lawsuit and a bankruptcy filing six years ago. The report said the hospital must close on a sale by March 31 to avoid a "liquidity crisis" that could cause it to shutter for good. Crain's said the auction originally had been set for Jan. 17, but after an entity called WSMC Properties submitted a bid on Jan. 14 -- and then upped its offer on Jan. 21 -- the auction was rescheduled. The WSMC offer consisted of a $14.4 million cash purchase of the property, the hospital's interest in capital leases for equipment and machinery, all real estate tax refunds and tax credits related to the real estate, and the hospital's interest in the tenant leases. As reported by the Troubled Company Reporter on Jan. 25, 2013, 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. 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. NIELSEN HOLDING: S&P Affirms 'BB' Corp. Credit Rating ----------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings on New York City-based global information and measurement company Nielsen Holding N.V. This includes the 'BB' corporate credit rating on both Nielsen and its wholly owned subsidiary The Nielsen Co. B.V., as well as all issue-level ratings on the company's debt. The outlook is stable. At the same time, S&P removed its ratings from CreditWatch, where it placed them with negative implications on Dec. 18, 2012, when Nielsen announced that it had entered into a definitive agreement to acquire Columbia, Md.-based Arbitron Inc. for about $1.3 billion in cash. "The affirmation reflects our reevaluation of Nielsen's business and financial prospects pro forma for its proposed acquisition of Arbitron and the company's public disclosure of its capital allocation plan," said Standard & Poor's credit analyst Tulip Lim. While the acquisition increases its "What Consumers Watch" segment exposure to traditional media, which is experiencing secular changes as audiences continue to fragment toward alternate media, it expands the company's measurement platform, which could benefit its "What Consumers Buy" retail measurement business clients. In addition, Arbitron brings expertise in measuring out-of-home audiences, which could benefit Nielsen's TV audience measurement service. S&P also believes that Nielsen, with its deeper financial resources and greater international reach, could better support technology improvement and drive revenue opportunities at Arbitron that will deliver a satisfactory return on investment. S&P expects that Nielsen will maintain leverage below 5x on a sustained basis. Over the next few years, the company could lower leverage further through EBITDA growth and accelerated debt repayment. The introduction of a common dividend, which provides greater clarity on the company's financial policy, however, will also result in deleveraging occurring at a more measured pace. S&P expects leverage could decline gradually to the mid-3x area by 2015, but that dividend increases and any additional debt-financed acquisitions could push out the timeframe. "Our ratings on Nielsen reflect a "satisfactory" business risk profile and an "aggressive" financial risk profile, based on our criteria. As the leading global provider of media measurement and retail sales and market share, Nielsen benefits from strong market positions in its two principal businesses. Nielsen's television audience measurement service is the industry standard in the U.S. and is unlikely to be displaced over our ratings horizon. We expect that Nielsen's operating performance will remain stable, given that a high proportion of sales is under multiyear contracts and the strong renewal rates (over 70% of "Watch" and "Buy" business segment revenues are recurring). We believe that Arbitron, the leading radio audience measurement service in the U.S., and which Nielsen has a definitive agreement to acquire, has similar characteristics. We assess Nielsen's management as "fair" under our criteria," S&P said. S&P views Nielsen's financial risk profile as aggressive because of its still elevated leverage, which S&P estimates to be slightly below 5x pro forma for the proposed Arbitron transaction, and S&P's expectation that leverage will remain above 4x through 2014. S&P estimates that leverage was 4.5x as of Dec. 31, 2012. NORTEL NETWORKS: Creditors Battle Over Trial on Cash Split ---------------------------------------------------------- Peg Brickley at Daily Bankruptcy Review reports U.S. investors are pushing to go to trial by the fall over how to divide Nortel Networks Corp.'s $7.3 billion pile of money, but officials looking out for Canadian and European creditors say the international cash clash could take much longer to sort out. 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: U.S. Unit Pans Canadian Retirees' Relief --------------------------------------------------------- Jamie Santo of BankruptcyLaw360 reported that Nortel Networks Inc., the American arm of defunct telecom giant Nortel Networks Corp., objected Tuesday to a move by former employees of its Canadian parent to file severance claims in Delaware bankruptcy court, arguing the claims are both untimely and dubiously timed. The report related that the Canadian employees offer no justifiable reason for filing claims in the U.S. more than three years after the bar date had passed, the objection said, and accepting their late claims would severely prejudice NNI and create a dangerous precedent. 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. NORTH BY NORTHWEST: Court Dismisses Chapter 11 Case --------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia in a December ruling granted Macon Bank Inc.'s motion to dismiss the Chapter 11 case of North by Northwest LLC. Macon Bank is the only secured creditor in the case. As of the Petition Date, the principal balance due, excluding interest and fees under Note 1 was $713,256 and under Note 2 was $2,257,483 totaling $2,970,739 owed to Macon Bank. Macon Bank said the case was filed in bad faith. About North By Northwest North By Northwest LLC filed a bare-bones Chapter 11 petition (Bankr. N.D. Ga. Case No. 12-42087) in Rome, Georgia, on July 12, 2012. North By Northwest scheduled $14,667,210 in assets and $4,202,709 in liabilities. The Debtor holds surface and mineral interests in the real property in Valley District, Fayette County, West Virginia, worth $12.5 million, and which secures a $3.05 million debt to Macon Bank. Bankruptcy Judge Paul W. Bonapfel presides over the case. Jim Knight, Esq., at Thomas F. Tierney, P.C., in Peachtree City, Georgia, serves as counsel. NPS PHARMACEUTICALS: Wellington Discloses 10.8% Equity Stake ------------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Wellington Management Company, LLP, disclosed that, as of Jan. 31, 2013, it beneficially owns 9,399,395 shares of common stock of NPS Pharmaceuticals, Inc., representing 10.85% of the shares outstanding. Wellington previously reported beneficial ownership of 9,565,459 common shares or a 11.11% equity stake as of Feb. 29, 2012. A copy of the amended filing is available for free at http://is.gd/Yd9zGL About NPS Pharmaceuticals Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq: NPSP) -- http://www.npsp.com/-- is developing new treatment options for patients with rare gastrointestinal and endocrine disorders. NPS reported a net loss of $36.26 million in 2011, a net loss of $31.44 million in 2010 and a net loss of $17.86 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $165.46 million in total assets, $212.20 million in total liabilities and a $46.74 million total stockholders' deficit. NY DOWNTOWN HOSPITAL: NY-Presbyterian Offered Bail Out ------------------------------------------------------ Barbara Benson, writing for Crain's New York Business, reports that New York-Presbyterian Hospital asked state health officials for permission to acquire New York Downtown Hospital, the only institution below 14th Street since St. Vincent's Hospital closed in 2010. Downtown "has experienced persistent, significant financial difficulties that threaten its future viability," New York-Presbyterian officials wrote in December in a request to the New York State Department of Health. '[Downtown Hospital] is projected to have a significant operating loss in 2013, unless the current situation is changed." According to the report, New York-Presbyterian blames Downtown's financial collapse on federal and state reimbursement cuts and the hospital's inability to either boost revenue or reduce costs. Downtown also has been forced into the red by maternity care. PACIFIC THOMAS: Court Appoints Kyle Everett as Chapter 11 Trustee ----------------------------------------------------------------- The Bankruptcy Court has granted the motion of August B. Landis, Acting United States Trustee for Region 17, for the Kyle Everett as Chapter 11 Trustee in Chapter 11 case of Pacific Thomas Corporation. About Pacific Thomas Corp. Walnut Creek, California, Pacific Thomas Corporation filed a Chapter 11 petition (Bankr. N.D. Calif. Case No. 12-46534) in Oakland on Aug. 6, 2012, estimating in excess of $10 million in assets and liabilities. The Debtor is related to Pacific Thomas Capital, which specializes in real estate services, focusing on the investment, ownership and development of commercial real estate properties, according to http://www.pacificthomas.com/ Real estate activities has spanned throughout the Hawaiian Islands as well as U.S. West Coast locations in California, Nevada, Arizona and Utah. Hawaii based activities are managed under the name Thomas Capital Investments. Bankruptcy Judge M. Elaine Hammond presides over the case. Anne- Leith Matlock, Esq., at Matlock Law Group, P.C. The petition was signed by Jill V. Worsley, COO, secretary. In its schedules, the Debtor disclosed $19,960,679 in assets and $16,482,475 in liabilities as of the petition date. PATRIOT COAL: 2013 Incentive Plan and CERP to Cost $6,950,000 ------------------------------------------------------------- Patriot Coal Corporation, et al., ask the Bankruptcy Court to authorize a Chapter 11 incentive and a critical employee retention plan. The Debtor said they need the plan to motivate and encourage the retention of critical employees during this uncertain period and to focus their attention on achieving important business objectives. The six members of the Debtors' executive management are not part of the proposed plans. Some 225 employees, who comprise approximately 5% of the Debtors' workforce, are eligible to participate in the 2013 annual incentive plan, the cost of which would total at most $875,000 for each six-month performance period. The CERP will benefit 119 of the Debtors' non-insider employees, which comprise less than 3% of the Debtors' workforce. The maximum cost of the CERP totals approximately $5.2 million. About Patriot Coal St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer and marketer of coal in the eastern United States, with 13 active mining complexes in Appalachia and the Illinois Basin. The Company ships to domestic and international electricity generators, industrial users and metallurgical coal customers, and controls roughly 1.9 billion tons of proven and probable coal reserves. Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11 petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y. Lead Case No. 12-12900) on July 9, 2012. Patriot said it had $3.57 billion of assets and $3.07 billion of debts, and has arranged $802 million of financing to continue operations during the reorganization. Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone Advisory Partners LP is serving as financial advisor, and AP Services, LLC is providing interim management services to Patriot in connection with the reorganization. Ted Stenger, a Managing Director at AlixPartners LLP, the parent company of AP Services, has been named Chief Restructuring Officer of Patriot, reporting to the Chairman and CEO. GCG, Inc. serves as claims and noticing agent. The U.S. Trustee appointed a seven-member creditors committee. Kramer Levin Naftalis & Frankel LLP serves as its counsel. Houlihan Lokey Capital, Inc., serves as its financial advisor and investment banker. Epiq Bankruptcy Solutions, LLC, serves as its information agent. On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's bankruptcy case to St. Louis. The order formally sending the reorganization to Missouri was signed December 19 by the bankruptcy judge. The New York Judge in a Jan. 23, 2013 order denied motions to transfer the venue to the U.S. Bankruptcy Court for the Southern District of West Virginia. PATRIOT COAL: UMWA Balks at $6-Mil. Bonus Plan for Executives ------------------------------------------------------------- The filing by Patriot Coal for permission to distribute some $6 million in bonuses to corporate executives and top managers demonstrates a "callous disregard for the lives and well-being of thousands of active and retired workers and their families whose lives are at risk as a result of Patriot's bankruptcy," United Mine Workers of America (UMWA) International President Cecil E. Roberts said on Feb. 13. Hundreds of active and retired and miners and their families, backed by union and community supporters, will protest actions by Patriot Coal and its original parent company, Peabody Energy, in downtown St. Louis on Feb. 13. Mine workers and supporters will march at 10 am today from the Crowne Plaza Hotel at 4th and Pine Streets to Peabody HQ at 701 Market Street in downtown St. Louis. Non-violent civil disobedience is expected following a rally at Kiener Plaza. The event will be livestreamed at: http://www.ustream.tv/channel/mineworkers Patriot's motion, filed in the Bankruptcy Court of Eastern District of Missouri, would pay bonuses to some 120 senior executives, company managers and office personnel. Under the plan filed today, the company's top six executives in the company will not receive bonuses at this time. "While Patriot is handing out cash to managers and executives, thousands of retirees and widows the company is responsible for are worried about having to choose between buying groceries or getting the prescription drugs they need to live," Ms. Roberts said. "That $6 million would pay for a month's worth of health care for retirees, dependents and widows. It's also $6 million Patriot could use to fight Peabody Energy and Arch Coal in court to get them to pay for these obligations. Patriot's bonus plan "a finger in the eye" of retirees and widows at risk of losing health care/2 "This is nothing more than a finger in the eye of those retirees and widows, as well as the active workers who are looking at the destruction of decades of collective bargaining improvements," Ms. Roberts said. "These workers put their health on the line and put their lives on the line every single day to produce coal. "It's not their fault Patriot is in bankruptcy," Ms. Roberts said. "For Patriot to now take millions of dollars that would help keep people alive and pass it around to already well-paid executives and managers is just wrong, and sends a terrible message to the active and retired workers who still depend on Patriot for their lives and livelihoods." About Patriot Coal St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer and marketer of coal in the eastern United States, with 13 active mining complexes in Appalachia and the Illinois Basin. The Company ships to domestic and international electricity generators, industrial users and metallurgical coal customers, and controls roughly 1.9 billion tons of proven and probable coal reserves. Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11 petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y. Lead Case No. 12-12900) on July 9, 2012. Patriot said it had $3.57 billion of assets and $3.07 billion of debts, and has arranged $802 million of financing to continue operations during the reorganization. Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone Advisory Partners LP is serving as financial advisor, and AP Services, LLC is providing interim management services to Patriot in connection with the reorganization. Ted Stenger, a Managing Director at AlixPartners LLP, the parent company of AP Services, has been named Chief Restructuring Officer of Patriot, reporting to the Chairman and CEO. GCG, Inc. serves as claims and noticing agent. The U.S. Trustee appointed a seven-member creditors committee. Kramer Levin Naftalis & Frankel LLP serves as its counsel. Houlihan Lokey Capital, Inc., serves as its financial advisor and investment banker. Epiq Bankruptcy Solutions, LLC, serves as its information agent. On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's bankruptcy case to St. Louis. The order formally sending the reorganization to Missouri was signed December 19 by the bankruptcy judge. The New York Judge in a Jan. 23, 2013 order denied motions to transfer the venue to the U.S. Bankruptcy Court for the Southern District of West Virginia. PERFORMANCE TRANSPORTATION: "New Value" Defense Tackled in Suit --------------------------------------------------------------- Bankruptcy Judge Michael J. Kaplan denied a motion for summary judgment filed by Ford Motor Company in a clawback lawsuit launched by the Chapter 7 trustee of bankrupt hauler Performance Transportation Services Inc. Instead, Judge Kaplan directed the adversary parties to return to Court Feb. 26 at 2:00 p.m. for a telephonic scheduling conference. Ford argues that more than $300,000 that was paid to it by two of Performance Trans' affiliates for vehicle damage are not subject to preference attack because of more than $14,000,000 of new hauling orders placed with those debtors by Ford during the preference period. To Ford, those new orders must have generated "new value" sufficient to offset the otherwise-preferential payments. Performance Trans and its affiliated companies once constituted the second largest hauler of new cars in North America. According to Judge Kaplan, "The matter at the Bar seems to be one of first impression. In 1938 and again in 1978 Congress tried to put an end to decades of judicial efforts to reconcile 'setoffs' with 'preferential transfers.' 11 U.S.C. Sec. 553 was the legislative result. '. . . [T]his title does not affect the right of a creditor to offset.' It was no longer necessary to shoehorn setoffs into preference analysis. It works very well. However, sophisticated parties sometimes do not use setoffs when, perhaps, they should." "For some reason not known to the Court, North American manufacturers of automobiles and the companies that haul those automobiles to distribution centers and dealers choose not to avail themselves of the sanctuary that Sec. 553 provides," Judge Kaplan continued. "Instead, as described in an earlier decision of this Court (475 B.R. 5 (Bankr. W.D.N.Y. 2012)), the manufacturers and the haulers maintain what might be called 'separate ledgers': One specifying what the manufacturer owes to the hauler for hauling services, and the other specifying what the hauler owes to the manufacturer for damages suffered by the vehicles while in the custody of the hauler." "Almost universally in the world of smaller businesses this would be dealt with by setoffs, but not in this particular industry. Original Equipment Manufacturers ('OEMs') pay for hauling services without regard to what an individual hauler might owe to the OEM for damaged vehicles, and the hauler pays the OEM for damages to vehicles, regardless of what the OEM owes to the hauler for hauling services." Ford posits that the new orders that it placed were essential to the Debtor, and kept it afloat. According to Judge Kaplan, there is a strong evidentiary basis for Ford's statement because the Bankruptcy Court approved the continuation of a "Damage Program" in "first day" orders when the Debtors' cases were in Chapter 11, based upon the affidavit of a principal of the Debtors, John Stalker, who emphasized the need to continue the program to remain competitive in the industry. The Chapter 11 cases were unconsolidated at that time. Ford agrees that it has no means of quantifying the "new value" bestowed upon the Debtors while the Debtors were paying vehicle damage obligations to Ford, but explain that whether one measures "new value" by cash flow, profit margin, maintaining a valuable relationship, or otherwise, its millions of dollars of new orders placed with the Debtor simply "had" to have provided "new value" to the Debtor in an amount in excess of the challenged transfers. Judge Kaplan noted that Ford seeks "burden-shifting" as to quantification of the "new value." According to Judge Kaplan, in economic terms, the Court does not dispute Ford's conclusion. "In legal terms, however, the Court finds that Ford wishes to place a square peg in a round hole," the judge said. Judge Kaplan held that a careful examination of the definition of "new value" contained in 11 U.S.C. Sec. 547(a) does not support Ford's argument. Earlier in the Adversary Proceeding, the Court asked counsel for Ford what Ford provided that would constitute "new value," and counsel answered "it provided 'money.'" The Court disagrees. Ford provided new purchase orders, not money. Ford obligated itself to pay for services to be rendered in the future by the Debtors, provided that the Debtors actually performed those services. As each new service order was fulfilled by the Debtors, Ford became the contract obligor. Ford became a debtor, not a creditor, and payment by Ford upon each of those work orders simply satisfied Ford's obligations to the Debtors. "It is best to restore this Adversary Proceeding to the Calendar for further scheduling," Judge Kaplan said. The cases before the Court are, Mark S. Wallach, Esq., Chapter 7 Trustee of Performance Transportation Services, Inc., et al. Plaintiff, v. Ford Motor Company, Defendant; Mark S. Wallach, Esq., Chapter 7 Trustee of Performance Transportation Services, Inc., et al. Plaintiff, v. Ford Motor Company, Defendant, Adv. Proc. Nos. 09-1190 K., 09-1244 K (Bankr. W.D.N.Y.). A copy of Judge Kaplan's Feb. 8 Opinion and Order is available at http://is.gd/9RpWdufrom Leagle.com. Attorney for the Plaintiff is Janet G. Burhyte, Esq. -- jburhyte@gross-shuman.com -- at Gross, Shuman, Brizdle & Gilfillan, P.C. in Buffalo, New York. Attorneys for Ford Motor Company are Marc N. Swanson, Esq., and Ronald A. Spinner, Esq. -- spinner@millercanfield.com and swansonm@millercanfield.com -- at Miller Canfield Paddock & Stone, PLC Detroit, Mich.; and Kevin Tompsett, Esq. -- ktompsett@harrisbeach.com -- at Harris Beach PLLC, in Pittsford, New York. About Performance Transportation Based in Wayne, Michigan, Performance Transportation Services, Inc. provided new and use vehicle delivery services in the United States. Performance Transportation has facilities in the United States and Canada. The Company and its debtor-affiliates filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No. 07-04746 thru 07-04760) on Nov. 19, 2007. When the Debtors filed for protection from their creditors, they estimated more than $100 million each in assets and debts. The Court converted the Debtors' Chapter 11 cases to cases under Chapter 7 of the Bankruptcy Code, effective as of July 14, 2008. Mark S. Wallach was appointed as trustee. Lawyers at Bond, Schoeneck & King, PLLC, Jones Day, and Hodgson Russ LLP, represent the Debtors as counsel. PHIL'S CAKE: Seeking Extension of Time to File Exit Plan -------------------------------------------------------- In January, Phil's Cake Box Bakeries, Inc., filed a motion asking the Bankruptcy Court to extend until Feb. 20. 2013, the deadline to file its Chapter 11 plan and disclosure statement. The Debtor is financing the bankruptcy through the use of cash collateral. The Debtor has won Court authority to use cash that constitute collateral of its pre-bankruptcy creditors. The Debtor said it needs access to the Cash Collateral to continue operating its businesses or manage its financial affairs, substantially in compliance with a budget. Pursuant to the cash collateral order, the Court authorized the Debtor to use the cash collateral that these parties may assert liens and security interests: i) Southern Commerce Bank, N.A.; ii) Zions First National Bank; iii) Heritage Bank; and iv) Colson, as successor in interest to the United States Small Business Association and the Florida Business Development Corporation. Pursuant to a third interim order, the Debtor is authorized to use cash collateral, including but not limited to funds on-hand prepetition or transferred postpetition into the Debtor's bank accounts maintained with SCB. As reported in the Troubled Company Reporter on Sept. 11, 2012, at different times, the Debtor executed loan agreements in favor of Southern Commerce Bank, N.A., Zions First National Bank, Heritage Bank, and Colson Services Corp., as successor in interest to the United States Small Business Association and the Florida Business Development Corporation: Amount Owed as of Lender the Petition Date ------ ----------------- Southern Commerce $1,600,000 ($660,000 relates to a line of credit) Zions $6,000,000 Heritage $250,000 Colson $3,000,000 BankAtlantic $43,000 SCB asserts that it has a first priority position with respect to accounts receivable and inventory. According to the Debtor, Zions may assert that it has perfected first position mortgage lien on the Debtor's Eagle Trail Facility, including any fixtures, including freezers and associated equipment located at the property. The Debtor asserts that Zions does not assert a lien on Cash Collateral. Heritage may assert that it has perfected first position mortgage liens on certain real property located in the vicinity of the Debtor's retail facility. The Debtor asserts that Heritage does not assert a lien on Cash Collateral. Colson may assert that it has perfected junior liens and security interest in the Eagle Trail Facility, including fixtures and equipment. The Debtor asserts that Colson does not assert a lien on Cash Collateral. BankAtlantic may assert liens on and security interests in certain items of equipment located at 1009 and 1017 N. Excelda Avenue. The Debtor asserts that BankAtlantic does not assert a lien on Cash Collateral. In exchange for the use of Cash Collateral, the Debtor proposes to provide the Secured Creditors with replacement liens identical in extent, validity and priority as such liens existed on the Petition Date. As additional adequate protection to SCB, the Debtor proposes to pay SCB on a monthly basis accrued interest on (i) the line of credit obligation; and (ii) the commercial loan obligation, Loan Number x125. SCB has filed a notice that it consents to the use of Cash Collateral. About Alessi's Bakeries Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a family-owned bakery and catering business owned and operated in Tampa, Fla., by four generations of the Alessi family. The operations have grown from a small bakery delivering bread by horse and wagon, to the current 100,000 square foot manufacturing facility serving retail customers nationwide, with a retail location maintaining and continuing its historic traditions in Tampa. Alessi's operates from two locations: a manufacturing facility and a retail bakery. The Eagle Trail manufacturing facility is located at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a 100,000 sq. ft. building which houses various production lines including five ovens, 40,000 sq. ft. of refrigerated space with four walk-in freezers and two coolers, and 20,000 sq. ft. of raw material and packing supplies warehouse space. Alessi's also operates a retail bakery facility, located at 2909 West Cypress Street, Tampa. Alessi's owns both locations. As of the Petition Date, Alessi's estimates that it has assets of roughly $14.5 million and liabilities of roughly $14.7 million. Liabilities include $5.9 million owing to Zions. There is another $3 million owing to the Small Business Administration and $820,000 to trade suppliers. Alessi's filed for bankruptcy to address the over-leveraging due to the Eagle Trail Facility acquisition and the inability fully and timely to service debt during the period in which sales dropped. Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May oversees the case. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, P.A., serves as the Debtor's counsel. The petition was signed by Philip Alessi, Jr., president. PHIL'S CAKE: Files Schedules of Assets and Liabilities ----------------------------------------------------- Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., filed with the Bankruptcy Court for the Middle District of Florida its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $5,845,803 B. Personal Property $6,668,713 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $11,033,900 E. Creditors Holding Unsecured Priority Claims $35,120 F. Creditors Holding Unsecured Non-priority Claims $3,525,288 ----------- ----------- TOTAL $12,514,516 $14,594,309 Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a family-owned bakery and catering business owned and operated in Tampa, Fla., by four generations of the Alessi family. The operations have grown from a small bakery delivering bread by horse and wagon, to the current 100,000 square foot manufacturing facility serving retail customers nationwide, with a retail location maintaining and continuing its historic traditions in Tampa. Alessi's operates from two locations: a manufacturing facility and a retail bakery. The Eagle Trail manufacturing facility is located at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a 100,000 sq. ft. building which houses various production lines including five ovens, 40,000 sq. ft. of refrigerated space with four walk-in freezers and two coolers, and 20,000 sq. ft. of raw material and packing supplies warehouse space. Alessi's also operates a retail bakery facility, located at 2909 West Cypress Street, Tampa. Alessi's owns both locations. As of the Petition Date, Alessi's estimates that it has assets of roughly $14.5 million and liabilities of roughly $14.7 million. Liabilities include $5.9 million owing to Zions. There is another $3 million owing to the Small Business Administration and $820,000 to trade suppliers. Alessi's filed for bankruptcy to address the over-leveraging due to the Eagle Trail Facility acquisition and the inability fully and timely to service debt during the period in which sales dropped. Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May oversees the case. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, P.A., serves as the Debtor's counsel. The petition was signed by Philip Alessi, Jr., president. PHIL'S CAKE: Court OKs Rick Fernandez as Property Manager --------------------------------------------------------- Phil's Cake Box Bakeries, Inc., dba Alessi's Bakery, sought and obtained permission from the U.S. Bankruptcy Court for the Middle District of Florida to employ Rick Fernandez as rental real estate property manager for rented lots, nunc pro tunc to the Petition Date. Alessi's operates from two locations: a manufacturing facility and a retail bakery. The retail bakery facility is located at 2909 West Cypress Street, Tampa, Florida. Between 1995 and 2005, the Debtor acquired a number of parcels in the area surrounding the Retail Bakery. A number of parcels were also acquired during that time period by an affiliate of the Debtor, Alessi Properties, Inc. The parcels fall into the following categories: (i) vacant lots with no improvements; (ii) improved lots which are unrented or unoccupied; and (iii) improved lots rented to unrelated tenants. The Rented Lots currently are rented to separate tenants for a total, collective monthly rental amount of approximately $2,150. Two of the Rented Lots, accounting for $1,450 of the Rental Income, are subject to liens in favor of Heritage Bank. The Debtor has sought authority to abandon the Heritage Bank Lots to Heritage Bank on a consensual basis. Effective upon the abandonment: (i) the Debtor will remit to Heritage Bank any of the post-petition Rental Income attributable to the Heritage Bank Lots received by the Debtor, and (ii) Fernandez will no longer serve as property manager for the Heritage Bank Lots. The Debtor anticipates that Mr. Fernandez may render these property management services: (a) collection of rent, and remittance of rent to the Debtor; (b) coordinate any necessary maintenance; (c) report to the Debtor as to efforts to lease vacant properties; and (d) perform such other services requested by the Debtor with respect to the Rented Lots. For the services, the Debtor proposes to pay Mr. Fernandez a commission equal to 10% of the monthly rents received from the Rented Lots. To the best of the Debtor's knowledge, Mr. Fernandez is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Alessi's Bakeries Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a family-owned bakery and catering business owned and operated in Tampa, Fla., by four generations of the Alessi family. The operations have grown from a small bakery delivering bread by horse and wagon, to the current 100,000 square foot manufacturing facility serving retail customers nationwide, with a retail location maintaining and continuing its historic traditions in Tampa. Alessi's operates from two locations: a manufacturing facility and a retail bakery. The Eagle Trail manufacturing facility is located at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a 100,000 sq. ft. building which houses various production lines including five ovens, 40,000 sq. ft. of refrigerated space with four walk-in freezers and two coolers, and 20,000 sq. ft. of raw material and packing supplies warehouse space. Alessi's also operates a retail bakery facility, located at 2909 West Cypress Street, Tampa. Alessi's owns both locations. As of the Petition Date, Alessi's estimates that it has assets of roughly $14.5 million and liabilities of roughly $14.7 million. Liabilities include $5.9 million owing to Zions. There is another $3 million owing to the Small Business Administration and $820,000 to trade suppliers. Alessi's filed for bankruptcy to address the over-leveraging due to the Eagle Trail Facility acquisition and the inability fully and timely to service debt during the period in which sales dropped. Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May oversees the case. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, P.A., serves as the Debtor's counsel. The petition was signed by Philip Alessi, Jr., president. PHIL'S CAKE: Hires Levin Papantonio to Pursue BP/Deepwater Claim ---------------------------------------------------------------- Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., asks the U.S. Bankruptcy Court for permission to employ Levin, Papantonio, Thomas, Mitchell, Rafferty & Proctor, P.A. as special counsel to pursue claim filed against BP PLC with respect to Alessi's claim arising from the Deepwater Horizon oil spill. Jemison Mims, Jr. attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Alessi's desires to pay Levin Papantonio on a contingency fee agreement as 20% of any amount received by Alessi's through a settlement of the BP/Deepwater Claim, or 33% of any amount awarded to Alessi's through a legal proceeding. About Alessi's Bakeries Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a family-owned bakery and catering business owned and operated in Tampa, Fla., by four generations of the Alessi family. The operations have grown from a small bakery delivering bread by horse and wagon, to the current 100,000 square foot manufacturing facility serving retail customers nationwide, with a retail location maintaining and continuing its historic traditions in Tampa. Alessi's operates from two locations: a manufacturing facility and a retail bakery. The Eagle Trail manufacturing facility is located at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a 100,000 sq. ft. building which houses various production lines including five ovens, 40,000 sq. ft. of refrigerated space with four walk-in freezers and two coolers, and 20,000 sq. ft. of raw material and packing supplies warehouse space. Alessi's also operates a retail bakery facility, located at 2909 West Cypress Street, Tampa. Alessi's owns both locations. As of the Petition Date, Alessi's estimates that it has assets of roughly $14.5 million and liabilities of roughly $14.7 million. Liabilities include $5.9 million owing to Zions. There is another $3 million owing to the Small Business Administration and $820,000 to trade suppliers. Alessi's filed for bankruptcy to address the over-leveraging due to the Eagle Trail Facility acquisition and the inability fully and timely to service debt during the period in which sales dropped. Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May oversees the case. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, P.A., serves as the Debtor's counsel. The petition was signed by Philip Alessi, Jr., president. PREMONT INDEPENDENT: Moody's Keeps 'Ba1' Rating on GOUT Bonds ------------------------------------------------------------- Moody's Investors Service affirmed the Ba1 rating on Premont Independent School District's (TX) general obligation bonds, which affects approximately $2.2 million in rated debt outstanding. The district has an additional $880 thousand of outstanding general obligation limited tax debt not rated by Moody's. Ratings Rationale: While the rating is below investment grade, Moody's expects that the district will maintain full and timely payment of their debt service obligation based upon the unlimited general obligation pledge of the bonds outstanding. Annual principal and interest requirements are secured by and payable from ad valorem taxes levied by the district on all taxable property, without legal limit as to rate or amount. The rating affirmation reflects the district's improved financial position, modest and concentrated tax base, a moderate debt burden that may increase in the near term, and a weak socioeconomic profile. Strengths Improved financial operations Challenges Trend of declining Average Daily Attendance (ADA) Volatile concentrated tax base due to reliance on oil and gas mineral valuations What Could Make The Rating Go Up - Significant tax base expansion and diversification - Multi-year trend of material improvement in financial position - Improved accreditation status with TEA, demonstrating compliance with record review What Could Make The Rating Go Down - Deterioration of the district's financial position - Continued contraction of the district's tax base - Failure to regain accreditation status with TEA, dissolution of district. The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. REDCATS USA: S&P Gives 'B' CCR; Affirms 'B' Rating on $305MM Loan ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to New York City-based Redcats USA Inc., doing business as OneStopPlus Group, following its merger with and into Oilers Borrower Corp. at the completion of the acquisition by Charlesbank Capital Partners LLC and Webster Capital. The outlook is stable. Concurrently, S&P affirmed its 'B' issue-level rating with a '3' recovery rating on Redcats' $305 million first-lien secured term loan due 2020. The '3' recovery rating indicates S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default. S&P also affirmed its 'CCC+' issue-level rating with a '6' recovery rating on the $85 million second-lien secured term loan, also due 2020. The '6' recovery rating indicates S&P's expectation for negligible (0% to 10%) recovery of principal in the event of a payment default. According to the company, the transaction will be funded with equity from Charlesbank Capital and Webster Capital and the first- and second-lien secured term loans. These proceeds will be used to purchase the company from PPR S.A. and pay fees and expenses. In addition, S&P withdrew its 'B' corporate credit rating on Oilers Borrower Corp. "The ratings on specialty apparel retailer Redcats USA Inc. reflect our view of the company's 'vulnerable' business risk profile and 'aggressive' financial risk profile," said Standard & Poor's credit analyst Kristina Koltunicki. Redcats' vulnerable business risk profile reflects its relatively small size in the highly fragmented and competitive plus-size apparel industry, high exposure to commodity cost volatility, and our "fair" assessment of the management team. OneStopPlus operates as an on-line platform and catalog encompassing eight proprietary brands, with merchandise primarily aimed at plus-size individuals. Competition continues to increase from other participants, such as mass merchants, department stores, and other specialty apparel retailers, who have been expanding their merchandise offerings in recent years to include plus sizes. The stable outlook reflects S&P's expectation that the company will improve credit protection measures modestly over the next 12 months, as it grows its top-line revenue and manages operating costs. S&P do not expect the company to generate a significant amount of free cash flow, which thus minimizes its potential for debt reduction. Although S&P expects some modest improvement in credit protection measures, S&P believes the company will maintain an aggressive financial risk profile over the next year. S&P could lower its ratings if operating performance weakens, leading to gross margin erosion of approximately 100 basis points (bps) below its expectations and flat sales growth. Under this scenario, leverage would have increased to about 5.4x, which would lead to a revision of the company's financial risk profile to "highly leveraged." S&P could also lower the ratings if the company's financial policies become more aggressive, such as through a significant debt-financed dividend to its sponsors. S&P could raise the rating if sales increase in the mid-single digits and gross margin increases 100 bps in the next 12 months. This scenario could arise from an enhanced merchandise offering that leads to an increase in sales ahead of S&P's projections. This would allow the company to better leverage its technology infrastructure, resulting in total debt to EBITDA under 4x. RESIDENTIAL CAPITAL: $7.2-Bil. Book Value of Assets as of Dec. 31 ----------------------------------------------------------------- Residential Capital LLC and its affiliates filed a notice with the Bankruptcy Court stating that the book value of their assets as of Dec. 31, 2012, is $7.279 billion, compared to the $7.356 billion book value as of May 31, 2012. The Debtors also disclosed that their first lien debt totals $2.757 billion as of the same date. A full-text copy of the disclosure is available at: http://bankrupt.com/misc/rescap_bookvalue1231.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: Centerbury Lawsuit vs. JPMorgan to Proceed --------------------------------------------------------------- Residential Capital LLC and J.P. Morgan Mortgage Acquisition Corporation entered into a court-approved stipulation providing that the automatic stay is modified to allow the lawsuit filed by Stephen J. Canterbury against J.P. Morgan and debtor GMAC Mortgage, LLC, to proceed solely between J.P. Morgan and Canterbury. All other respects of the lawsuit remains stayed against GMAC Mortgage. The lawsuit, filed in September 2012, seeks rescission of a $1.0 million debt obligation and damages under the Truth in Lending Act with the U.S. District Court for the Western District of Virginia. As alleged in the complaint, GMAC was the original lender on the obligation, and it later assigned the promissory note that evidenced the obligation to J.P. Morgan. 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: Ally CEO Threatens to Withdraw $750-Mil. Deal ------------------------------------------------------------------ Michael Carpenter, chief executive officer of Ally Financial, Inc., the parent of Residential Capital, LLC, threatened to withdraw the $750 million prepetition deal the auto lender entered into with creditors of ResCap's mortgage servicing arm if they can't "expeditiously" agree to the settlement terms, Brian Mahoney of BankruptcyLaw360 reported. Mr. Carpenter, speaking to investors during the company's fourth- quarter earnings call, said the company was ready to "go the litigation route" if the agreement, designed to distance Ally from liability over the ResCap's failure, falls through, the report related. 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: Ocwen to Buy Mortgage Servicing Platform ------------------------------------------------------------- Altisource Portfolio Solutions S.A., on behalf of itself and its subsidiaries, entered into non-binding letters of intent with Ocwen Financial Corporation, on behalf of itself and its subsidiaries, to acquire certain fee-based businesses related to Ocwen's recently acquired Homeward Residential Holdings, Inc. mortgage servicing and origination business platform and Ocwen's anticipated purchase of the mortgage servicing platform from Residential Capital, LLC for a combined purchase price of $218.6 million. William B. Shepro, Chief Executive Officer of Altisource said, "These fee based business acquisitions are strategically valuable to Altisource, helping us maintain our business model with Ocwen, expanding our footprint and providing significant revenue and earnings growth to Altisource. We believe the combined purchase price will provide a projected unlevered pre-tax return to Altisource of approximately 20%." Ronald M. Faris, Chief Executive Officer of Ocwen said, "By selling these non-core assets, Ocwen is able to achieve a greater projected return on the Homeward and ResCap servicing acquisitions and to continue to focus primarily on growing our core residential and commercial servicing businesses. Having an outlet for disposition of peripheral mortgage-related assets significantly enhances Ocwen's competitive positioning for future servicing platform acquisitions that include non-core operations." The letter of intent for the Homeward Residential Fee-Based Businesses contemplates that Altisource will acquire from Ocwen (i) all of the capital stock of Beltline Road Insurance Agency, Inc., Power Default Services, Inc., Power REO Management Services, Inc. and Power Valuation Services, Inc., (ii) the Mortgage Asset Recovery Special Services Division of Stratus Asset Management Group, LLC, and (iii) certain designated intellectual property and information technology assets related to Homeward Residential Holdings, Inc. platform. The letter of intent for the ResCap Fee-Based Businesses contemplates that Altisource will acquire from Ocwen certain fee- based businesses related to default management and charge-off services, designated intellectual property and information technology assets related to Ocwen's anticipated purchase of Residential Capital LLC's mortgage servicing platform. In connection with the proposed transactions, Altisource and Ocwen will execute a five-year extension until 2025 of certain existing services agreements. Additionally, Ocwen will not develop similar fee-based services that would directly or indirectly compete with the services provided by Altisource to the Homeward Residential Holdings, Inc. and Residential Capital, LLC servicing portfolios. The proposed purchase price is subject to working capital and other adjustments, and consummation of the transactions is subject to a number of contingencies that are customary for a transaction of this nature, including various third party and regulatory consents and approvals. The purchase of the ResCap Fee-Based Businesses is also subject to Ocwen's closing of the underlying acquisition of the mortgage servicing platform from Residential Capital LLC, which is expected later in February 2013. About Altisource Altisource Portfolio Solutions S.A. -- http://www.Altisource.com -- is a global provider of services focused on high-value, technology-enabled knowledge-based solutions principally related to real estate and mortgage portfolio management, asset recovery and customer relationship management. About Ocwen Ocwen Financial Corporation -- http://www.Ocwen.com-- is a financial services holding company which, through its subsidiaries, is engaged in the servicing and origination of mortgage loans. Ocwen is headquartered in Atlanta, Georgia, and has additional offices and operations in Florida, New Jersey, Texas, Washington, DC, the United States Virgin Islands, India and Uruguay. 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 ). REVEL AC: Inks Fourth Amendment to JPMorgan Credit Agreement ------------------------------------------------------------ Revel AC, Inc., entered into a fourth amendment to the Credit Agreement, dated as of May 3, 2012, among the Company, the guarantors, the lenders, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and the other parties. The Company continues to be required to maintain a sum of the unused revolving commitments plus the lesser of (1) $5,000,000 and (2) cash and cash equivalents that is greater than the sum of the Minimum Liquidity Thresholds and certain reserves associated with amenities capital expenditures. The Fourth Amendment amends the Revolving Credit Agreement to change the Minimum Liquidity Thresholds and associated time periods. Pursuant to the Fourth Amendment "Minimum Liquidity Thresholds" means from Dec. 20, 2012, through Jan. 29, 2013, $75,000,000; from Jan. 30, 2013 through Feb. 8, 2013, $66,000,000; from Feb. 9, 2013, through Feb. 12, 2013, $59,000,000; from Feb. 13, 2013, through Feb. 18, 2013, 75,000,000; from Feb. 19, 2013, through April 15, 2013, $50,000,000; from April 16, 2013, through May 15, 2013, $45,000,000; and from May 16, 2013, through July 1, 2013, $20,000,000. Certain lenders and agents under the Amended Revolving Credit Agreement, and certain of their respective affiliates, have performed investment banking, commercial lending and advisory services for the Company and its affiliates, from time to time, for which they have received customary fees and expenses. These parties may, from time to time, engage in transactions with, and perform services for, the Company and its affiliates in the ordinary course of their business. A copy of the Fourth Amendment is available for free at: http://is.gd/gsuTWg About Revel AC Atlantic City, N.J. Revel AC, Inc., owns and operates Revel, a Las Vegas-style, beachfront entertainment resort and casino located on the Boardwalk in the south inlet of Atlantic City, New Jersey. At Sept. 30, 2012, the Company had $1.14 billion in total assets, $1.39 billion in total liabilities and a $243.12 million total owners' deficit. * * * As reported by the TCR on Aug. 21, 2012, Standard & Poor's Ratings Services lowered its corporate credit rating on Atlantic City- based Revel AC Inc., the operator of the Revel Resort, to 'CCC' from 'B-'. "The downgrade reflects our view that a strong opening for the Revel Resort was critical to the company's ability to ramp up cash flow generation to a level sufficient to service its capital structure. In February 2011, Moody's Investors Service assigned Caa1 Corporate Family and Probability of Default ratings to Revel AC, LLC. The Caa1 Corporate Family Rating and Probability of Default Rating (PDR) reflect the considerable development and ramp-up risk associated with Revel AC. RG STEEL: Sues Suppliers to Recover Preferential Transfers ---------------------------------------------------------- RG Steel Sparrows Point, LLC filed separate lawsuits against four suppliers to avoid and recover transfers of property made within 90 days before its bankruptcy filing. The suppliers are Mono Ceramics Inc., Mickelson & Company LLC, Otis Elevator Co., and Paul Wurth Inc. In the complaints, RG Steel said it made transfers of an interest of its property to or for the benefit of the suppliers through payments of more than $1.04 million. The transfers were made between March 2 and May 31, 2012. The complaints were filed on February 11 in the U.S. Bankruptcy Court for the District of Delaware. About RG Steel RG Steel LLC -- http://www.rg-steel.com/-- is the United States' fourth-largest flat-rolled steel producer with annual steelmaking capacity of 7.5 million tons. It was formed in March 2011 following the purchase of three steel facilities located in Sparrows Point, Maryland; Wheeling, West Virginia and Warren, Ohio, from entities related to Severstal US Holdings LLC. RG Steel also owns finishing facilities in Yorkville and Martins Ferry, Ohio. It also owns Wheeling Corrugating Company and has a 50% ownership in Mountain State Carbon and Ohio Coatings Company. RG Steel along with affiliates, including WP Steel Venture LLC, sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12- 11661) on May 31, 2012, to pursue a sale of the business. The bankruptcy was precipitated by liquidity shortfall and a dispute with Mountain State Carbon, LLC, and a Severstal affiliate, that restricted the shipment of coke used in the steel production process. The Debtors estimated assets and debts in excess of $1 billion as of the Chapter 11 filing. The Debtors owe (i) $440 million, including $16.9 million in outstanding letters of credit, to senior lenders led by Wells Fargo Capital Finance, LLC, as administrative agent, (ii) $218.7 million to junior lenders, led by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million on account of a subordinated promissory note issued by majority owner The Renco Group, Inc., and (iv) $100 million on a secured promissory note issued by Severstal. Judge Kevin J. Carey presides over the case. The Debtors are represented in the case by Robert J. Dehney, Esq., and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP, and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T. Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial advisor and The Seaport Group serves as lead investment banker. Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson Consultants LLC is the claims and notice agent. Wells Fargo Capital Finance LLC, as Administrative Agent, is represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang Ziehi & Jones LLP. Renco Group is represented by lawyers at Cadwalader, Wickersham & Taft LLP. An official committee of unsecured creditors has been appointed in the case. Kramer Levin Naftalis & Frankel LLP represents the Committee. Huron Consulting Services LLC serves as its financial advisor. The Debtor has sold off the principal plants. The sale of the Wheeling Corrugating division to Nucor Corp. brought in $7 million. That plant in Sparrows Point, Maryland, fetched the highest price, $72.5 million. RG STEEL: Wants to Sell Asset to Bounty Mineral for $3.17-Mil. -------------------------------------------------------------- RG Steel Wheeling, LLC, said it plans to sell an asset to Fort Worth, Texas-based Bounty Mineral LLC for more than $3.17 million. RG Steel is selling its right, title and interest in and to 1,268.0230 net mineral acres in Brooke County, West Virginia; Jefferson County, Ohio; and Belmont County, Ohio. The asset will be sold on an "as is" basis, free and clear of all liens, claims, or encumbrances, according to a court filing. Objections to the proposed sale must be filed with the U.S. Bankruptcy Court for the District of Delaware on or before Feb. 26. The terms of the sale are outlined in a three-page agreement, which can be accessed for free at http://is.gd/YBDZ4D About RG Steel RG Steel LLC -- http://www.rg-steel.com/-- is the United States' fourth-largest flat-rolled steel producer with annual steelmaking capacity of 7.5 million tons. It was formed in March 2011 following the purchase of three steel facilities located in Sparrows Point, Maryland; Wheeling, West Virginia and Warren, Ohio, from entities related to Severstal US Holdings LLC. RG Steel also owns finishing facilities in Yorkville and Martins Ferry, Ohio. It also owns Wheeling Corrugating Company and has a 50% ownership in Mountain State Carbon and Ohio Coatings Company. RG Steel along with affiliates, including WP Steel Venture LLC, sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12- 11661) on May 31, 2012, to pursue a sale of the business. The bankruptcy was precipitated by liquidity shortfall and a dispute with Mountain State Carbon, LLC, and a Severstal affiliate, that restricted the shipment of coke used in the steel production process. The Debtors estimated assets and debts in excess of $1 billion as of the Chapter 11 filing. The Debtors owe (i) $440 million, including $16.9 million in outstanding letters of credit, to senior lenders led by Wells Fargo Capital Finance, LLC, as administrative agent, (ii) $218.7 million to junior lenders, led by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million on account of a subordinated promissory note issued by majority owner The Renco Group, Inc., and (iv) $100 million on a secured promissory note issued by Severstal. Judge Kevin J. Carey presides over the case. The Debtors are represented in the case by Robert J. Dehney, Esq., and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP, and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T. Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial advisor and The Seaport Group serves as lead investment banker. Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson Consultants LLC is the claims and notice agent. Wells Fargo Capital Finance LLC, as Administrative Agent, is represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang Ziehi & Jones LLP. Renco Group is represented by lawyers at Cadwalader, Wickersham & Taft LLP. An official committee of unsecured creditors has been appointed in the case. Kramer Levin Naftalis & Frankel LLP represents the Committee. Huron Consulting Services LLC serves as its financial advisor. The Debtor has sold off the principal plants. The sale of the Wheeling Corrugating division to Nucor Corp. brought in $7 million. That plant in Sparrows Point, Maryland, fetched the highest price, $72.5 million. ROBIN CINI: Former Spouse Sanctioned for Violating Automatic Stay ----------------------------------------------------------------- Bankruptcy Judge Ralph B. Kirscher granted the request of debtor Robin Jean Lyon Cini for sanctions against her former spouse Nigel Cini for violations of the automatic stay under 11 U.S.C. Sec. 362(k) by filing two lawsuits against Robin in the Flathead County Montana District Court. Nigel filed a response in opposition calling Robin's Motion frivolous and asking that she be held in contempt. Judge Kirscher said the Debtor satisfied her burden of proof to show by a preponderance of the evidence that Nigel willfully violated the automatic stay by filing the complaints while knowing of the automatic stay. However, Judge Kirscher said the Debtor's only injuries are attorneys' fees in the total amount of $4,200 incurred in investigating and litigating the Motion. Insufficient evidence exists warranting an award of costs, and insufficient evidence exists warranting punitive damages. A copy of the Court's Feb. 8, 2013 Memorandum of Decision is available at http://is.gd/UPBmBKfrom Leagle.com. The bankruptcy proceeding began Nov. 19, 2010, when Robin filed a voluntary Chapter 13 petition (Bankr. D. Mont. Case No. 10-62715). At the Debtor's behest, the Court on Feb. 9, 2011, converted the case to Chapter 11. RTJJ INC: Community One Bank Fails to Block Plan Confirmation ------------------------------------------------------------- RTJJ Inc. won confirmation of its Second Amended Plan Of Reorganization, defeating the objection filed by Community One Bank, N.A. Bankruptcy Judge J. Craig Whitley also denied the request of Community One for relief from the automatic stay. Hearings on the Plan were held Oct. 29 to 30, 2012. RTJJ Inc. is a small family business, which owns 62 rental houses, apartments and undeveloped residential building lots in Gastonia, North Carolina. Most of these are former single-family residences, colloquially "mill houses." More recently, these homes have been subdivided for rental as individual apartments. Thus, a single dwelling may be rented to multiple tenants. RTJJ's business is unique in the local market not just for this, but also because it rents furnished apartments on a weekly rental basis. The family patriarch, Harrill Jones, started RTJJ's predecessor businesses (Harrill Jones, Inc. and Excelsior Group, Inc.) in the 1960's. Mr. Jones' businesses prospered and for years, the companies had a waiting list of tenants. These companies catered to textile worker tenants. In 1997, sons Rick, Todd, and Jeffrey Jones incorporated RTJJ and purchased many of the Properties from these predecessor companies. Between 2000 and 2004, many Gaston County mills closed. The closings adversely affected the local economy and left one-third of the Jones' companies' rental units vacant. Meanwhile, Harrill Jones suffered other business and investment reversals. In 2005, Harrill Jones took his own life. This unfortunate sequence of events left the Jones family businesses in a tough spot. Rick Jones, RTJJ's President, says his father's death left the businesses with $3,500,000 in insurance proceeds but over $7,000,000 in debt, including a $650,000 federal tax debt. In 2006, RTJJ purchased the remaining properties owned by Harrill Jones, Inc. and Excelsior Group, Inc. Community One financed the purchases as well as the company's tax debt. Community One's debts exist under four notes and three separate deeds of trust, which give it a perfected mortgage debt on all but one of RTJJ's real properties. Creditor First National Bank of Shelby holds a mortgage on that one other rental house. From what can be surmised, there never was much equity in the Properties over Community One's loan balance, if any. It may be that the Properties were over encumbered from the outset. Either way, Community One's secured position suffered dramatic erosion after the 2007 housing bubble bust and national real estate values plummeted. Between these events and its then high vacancy rate, RTJJ was unable to make its monthly mortgage payments. It succeeded in obtaining a 12-month forbearance agreement from Community One. RTJJ used this time to remodel its properties, redirect its business, and attempt to return to profitability. Recognizing that the market for apartment rentals had changed, RTJJ converted a number of its one bedroom apartments into larger two bedroom apartments. This change improved the company's occupancy rate; however, RTJJ was still unable to make its full mortgage payments. Community One then instituted foreclosure proceedings against the Properties. To stop the sale, on August 8, 2011, RTJJ filed Chapter 11. According to its Schedules, RTJJ owed secured debt of $3,918,967 at the filing date, no priority debt, and $43,191 of general unsecured debt. The claims docket as of Oct. 27, 2011 summarizes filed claims as follows: $2,534,209 secured; $453.67 priority; and $57,189.48 general unsecured. Since bankruptcy, RTJJ has continued to operate the Properties under an agreed cash collateral order with Community One. The Debtor's postpetition operations have been quite successful. All concerned agree that RTJJ is a well-run company. From the two appraisers who testified at an earlier valuation hearing, to the Gastonia City manager, all agree that RTJJ has a very good reputation, is well run, and is compliant with applicable housing requirements. It is also undisputed that as the only area business of its sort, RTJJ serves a vital need in the Gastonia low-income housing market. Because RTJJ's Properties are located in fragile, poor neighborhoods, Gastonia believes that loss of this business would have a negative effect on the community, both in loss of low-income housing and the prospect of increased crime. Unfortunately, even at full occupancy levels, the Properties do not generate sufficient revenues to service the mortgage debt of Community One and First National. Thus, reorganization is dependent on RTJJ being able to "smooth down" its secured debt to a level that the Properties can support. With First National, doing so has been relatively easy. RTJJ and First National agree that its single collateral property has a value (and therefore a secured claim) of $17,500, and an unsecured 'deficiency' of about $7,500. The two sides have agreed on the treatment of these claims in a plan. The Community One situation is much more contentious. In its Schedules, RTJJ originally valued Community One's collateral at $864,710. However, Community One has maintained throughout the case that its collateral was worth more than its $2,453,838 debt. The proper valuation of the Properties and thus, Community One's secured claim has been the crucial issue in the case. When RTJJ filed its original plan and disclosure Statement on Jan. 18, 2012, it proposed to value Community One's collateral per 11 U.S.C Sec. 506(a) and bifurcate the debt between its secured and unsecured portions. The secured claim was to be re-amortized and paid in installments as a long term secured claim. The unsecured claim would be treated with other unsecured claims and receive a small dividend. The accompanying Disclosure Statement was approved on March 1, 2012 and the Plan was circulated for balloting on March 13, 2012. A balloting response deadline was set for April 3, 2012. However, Community One was the only creditor to file a timely ballot. It rejected the plan and further filed an objection to confirmation. By agreement, confirmation was then delayed to have the Properties appraised. A valuation hearing was held on July 9, 2012. The Properties were ascribed a fair market value of $1,471,350. Community One holds a secured claim of the same amount. Its remaining $982,487.00 debt is an unsecured claim. Disappointed about not being treated as fully secured, Community One then sought relief from stay to foreclose on its collateral. It also objected to two late-filed unsecured ballots that accepted the original plan, those of Simonds Sanitation (Ballot filed April 11, 2012; claim of $700) and First National (Ballot filed August 6, 2012; claim of $17,500). It later objected to RTJJ's Balloting Report, which counted these tardy ballots for confirmation purposes. RTJJ replied with its motion seeking allowance of the two ballots and tweaked its Original Plan with amendments filed Sept. 21, 2012 and Oct. 16, 2012. The Second Amended Plan contemplates that RTJJ will continue to operate its business and fund plan payments through future revenues. Community One's $1,471,350 secured claim (Class 1) is to be repaid with interest at 5% per annum, in monthly installments of $8,599.32 under a 25-year amortization schedule and with a seven year call. As filed, the Second Amended Plan proposes to surrender three of the Properties in a "dirt for debt" provision. However, Community One objected to this treatment, and at the confirmation hearing, RTJJ withdrew this proposal. RTJJ currently proposes to retain all of the Properties and pay the full secured portion of the claims. Meanwhile, Community One's $982,487 unsecured claim is treated in Class 4, together with the claims of Harill Jones, Inc., Patty M. Jones, and the Exclesior Group. Each is the unsecured portion of a mortgage claim. As filed, the Second Amended Plan proposes to give Class 4 claimants nonvoting Class B stock in satisfaction of their unsecured claims. Community One objected to this treatment, suggesting that the Class B stock is worthless and noting that 11 U.S.C. Sec. 1123(a)(6) prohibits a reorganized debtor from issuing nonvoting stock. Again seeking to appease its lender, at the confirmation hearing RTJJ amended the Class 4 treatment to give Community One an immediate $50,000 cash payment in satisfaction of its Class 4 claim. All other class members (all are insiders) agreed to waive a distribution on their Class 4 claims. Regarding First National, the $17,500 secured portion of its mortgage claim (Class 2) is to be paid in monthly installments with 4.25% interest, a 20-year amortization period and a five year call date. The remaining $7,500 balance of First National's debt is to be treated as a Class 5 unsecured claim. All other unsecured claims are treated in Class 5. These holders are to receive two percent of their allowed claims payable over five years in equal annual installments, without interest. RTJJ's outstanding stock will be cancelled. The Jones brothers will contribute $20,000 to the reorganized Debtor in exchange for new Class A Common Stock. Class A Common Stock is to receive no interest, dividends, or any other distributions while Community One's Class 1 secured claim is outstanding (and as filed, while the Class B Common Stock is outstanding). The Plan alternatively proposed to auction the Class A Common Stock at the confirmation hearing. Given the hearing amendment to Class 4, the stock restriction is no longer applicable. Community One has objected to confirmation of each iteration of the Plan, including the verbal amendments offered at hearing. It argues the following: (1) classifying its unsecured claim separate from the Class 5 unsecured claims constitutes unfair gerrymandering; (2) no impaired class has accepted the Second Amended Plan as required by 11 U.S.C. Sec. 1129(a)(10); (3) this plan is not fair and equitable under 11 U.S.C. Sec. 1129(a)(B)(ii)(a) because the interest rate to be paid on its Class 1 secured claim is too low; and (4) this plan is not fair and equitable as to its Class 4 unsecured claim because it violates the absolute priority rule. Community One objects to the Jones brothers receiving the new Class A stock and argues that heir $20,000 payment does not constitute "new value" under Sec. 1129(a)(B)(ii)(a). By contrast, the other two balloting, non-insider creditors, First National and Simonds, are satisfied with the Debtor's plan. They believe that their treatment under the Second Amended Plan (revised) while modest, is superior to what they could expect in either liquidation or foreclosure. All of RTJJ's assets are subject to the liens of Community One, First National, or the subordinate mortgages of the other Class 4 creditors. Even at fair market values, these rental properties are upside down at least $2,500,000. (Fair market value of $1,470,000 as compared to mortgage debt of $3,918,967.00). The two first priority lenders, Community One and First National, are greatly undersecured, even at fair market values. However, in a forced liquidation or foreclosure, the Properties would fetch far less than fair market value. The RTJJ houses are unique assets. Generally, they are old houses. Most have been extensively remodeled such that a single house typically contains multiple apartments. Because of this, these houses could not be resold for use as single-family residences without substantial modifications. Further, they are unlikely to be sold "as is" for use by other landlords. There are no other landlords in the Gastonia market who operate similar businesses (furnished units, multiple units per house, weekly rentals). The real estate market is weak. Because there are so many of these rental properties and the market is so small (population of Gastonia, N.C. is only 70,000), a forced sale of the Properties would flood the low- income real estate market and further depress already depressed values. In a Chapter 7 liquidation or foreclosure, the seller of the Properties would take an unbelievable "bath." Meanwhile, RTJJ also owes administrative expenses of at least $45,313. Hypothetical Chapter 7 administrative expenses would run at least this much, even assuming that the lenders would consent to a short sale. In sum, in a liquidation or foreclosure, there will be no distribution to unsecured creditors. Secured creditors would recover much less than the secured portion of their claims. Notwithstanding the obvious deleterious effects of a foreclosure, unless RTJJ can pay its entire $2.5 million debt, Community One wants to pursue this course. Its motivation appears to have little to do with RTJJ or the merits of the Second Amended Plan. Like many community banks that before the real estate crash had made too many real estate and development loans, Community One has had its own problems of late. At the confirmation hearing, RTJJ introduced several pieces of evidence bearing on the bank's woes. Among this evidence, as of March 31, 2011, the Bank was categorized as "critically undercapitalized." and was almost closed by the Office of the Controller of the Currency. It, a sister bank, and their holding company have been operating under OCC supervision for some time. Given this, and because Community One's demands are alternatively unrealistic (the demand to be paid as a fully secured creditor per the original loan terms), or self destructive (the request to foreclose), RTJJ believes that the Bank's actions are based on regulatory pressures and not on the merits of the Plan. On this record, it appears that RTJJ is correct, the Court noted. A copy of the Court's Feb. 6, 2013 Order is available at http://is.gd/ee8IElfrom Leagle.com. RTJJ, Inc., based in Gastonia, North Carolina, filed for Chapter 11 bankruptcy (Bankr. W.D.N.C. Case No. 11-32050) on Aug. 8, 2011. Judge J. Craig Whitley oversees the case. James H. Henderson, P.C., serves as the Debtor's counsel. In its petition, the Debtor estimated under $1 million in assets, and between $1 million to $10 million in debts. A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/ncwb11-32050.pdf The petition was signed by Rick L. Jones, president. Community One Bank is represented in the case by Douglas (Doug) R. Ghidina, Esq., and Caroline Hubbell Yingling, Esq. -- dougghidina@mvalaw.com and carolineyingling@mvalaw.com -- at Moore & Van Allen. SCHOOL SPECIALTY: Lee Munder Files Amended Schedule 13G with SEC ---------------------------------------------------------------- Lee Munder Capital Group LLC filed with the U.S. Securities and Exchange Commission an amended Schedule 13G, a copy of which is available for free at http://is.gd/tuJkzs About School Specialty Based in Greenville, Wisconsin, School Specialty is a supplier of educational products for kindergarten through 12th grade. Revenue in 2012 was $731.9 million through sales to 70 percent of the country's 130,000 schools. School Specialty and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 (Bankr. D. Del. Lead Case No. 13-10125) on Jan. 28, 2013, to facilitate a sale to lenders led by Bayside Financial LLC, absent higher and better offers. Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. Alvarez & Marsal North America LLC is the restructuring advisor and Perella Weinberg Partners LP is the investment banker. Kurtzman Carson Consultants LLC is the claims and notice agent. The petition estimated assets of $494.5 million and debt of $394.6 million. SCHOOL SPECIALTY: Dimensional Fund Discloses 7.4% Equity Stake -------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 1,426,575 shares of common stock of School Specialty Inc. representing 7.44% of the shares outstanding. A copy of the filing is available at: http://is.gd/AUNHYA About School Specialty Based in Greenville, Wisconsin, School Specialty is a supplier of educational products for kindergarten through 12th grade. Revenue in 2012 was $731.9 million through sales to 70 percent of the country's 130,000 schools. School Specialty and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 (Bankr. D. Del. Lead Case No. 13-10125) on Jan. 28, 2013, to facilitate a sale to lenders led by Bayside Financial LLC, absent higher and better offers. Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. Alvarez & Marsal North America LLC is the restructuring advisor and Perella Weinberg Partners LP is the investment banker. Kurtzman Carson Consultants LLC is the claims and notice agent. The petition estimated assets of $494.5 million and debt of $394.6 million. SEARS HOLDINGS: Holds 51% Equity Stake in Sears Canada Inc. ----------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Sears Holdings Corporation, Sears Canada Holdings Corp., Sears International Holdings Corp., Sears, Roebuck and Co., and SHLD Acquisition Corp. disclosed that, as of Dec. 31, 2012, they beneficially own 51,962,391 shares of common stock of Sears Canada Inc. representing 51% based upon 101,877,662 shares outstanding as of Nov. 15, 2012, as disclosed in the Company's Current Report on Form 6-K that was filed by the Company with the Securities and Exchange Commission on Nov. 16, 2012. A copy of the regulatory filing is available at http://is.gd/ufderp 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. SELECT MEDICAL: Moody's Rates Proposed Senior Term Loan 'B1' ------------------------------------------------------------ Moody's Investors Service assigned a B1 (LGD 3, 45%) rating to Select Medical Corporation's proposed senior secured term loan due 2016. Moody's understands that the proceeds of the new term loan will be used to refinance the company's 7.625% senior subordinated notes due 2015 and the senior floating rate notes due 2015 issued by Select Medical Holdings Corporation. Select Medical Corporation is a wholly owned subsidiary of Select Medical Holdings Corporation. Moody's also lowered the rating on the company's existing senior secured debt to B1 (LGD 3, 45%). This reflects the fact that the senior secured bank debt will represent the preponderance of obligations in the capital structure following the planned redemption and the elimination of the subordinated debt. The subordinated debt had provided first loss absorption as it had been contractually and structurally subordinated to the bank debt. Moody's will withdraw the ratings on the senior subordinated notes and senior floating rate notes once they are retired. Moody's affirmed the remaining ratings of the company, including the B1 Corporate Family Rating, B1-PD Probability of Default Rating and SGL-2 Speculative Grade Liquidity Rating. Following is a summary of Moody's rating actions. Ratings assigned: Select Medical Corporation: Senior secured term loan due 2016, B1 (LGD 3, 45%) Ratings downgraded: Select Medical Corporation: Senior secured revolving credit facility expiring 2016, to B1 (LGD 3, 45%) from Ba3 (LGD 3, 38%) Senior secured term loan B due 2018, to B1 (LGD 3, 45%) from Ba3 (LGD 3, 38%) Ratings affirmed: Select Medical Corporation: 7.625% senior subordinated notes due 2015, at B3 (LGD 5, 87%) Select Medical Holdings Corporation: Senior floating rate notes due 2015, at B3 (LGD 6, 94%) Corporate Family Rating, at B1 Probability of Default Rating, at B1-PD Speculative Grade Liquidity Rating, at SGL-2 Ratings Rationale: Select's B1 Corporate Family Rating reflects the company's moderately-high leverage, as well as its reliance on the specialty hospital segment for the majority of its EBITDA, which presents risk given the concentration of revenue from Medicare. The rating also reflects Moody's consideration of Select's considerable scale and position as one of the largest long-term acute care and outpatient rehabilitation providers in the US. Ratings also reflect Moody's expectation that the company will continue to generate strong free cash flow that can be used to repay debt and invest in growth opportunities. The rating could be upgraded if Moody's expects the company to maintain leverage below 4.0 times either through additional debt repayment or EBITDA growth. Moody's would also have to be comfortable that the current operations could absorb negative regulatory developments at the higher rating level or see evidence that the regulatory environment was becoming more benign. Moody's could downgrade the rating if adverse developments in Medicare regulations or reimbursement result in significant deterioration in margins or cash flow coverage metrics, or if the company completes a material debt financed acquisition or shareholder initiative. More specifically, Moody's could downgrade the rating if leverage is expected to rise and be sustained above 5.0 times. The principal methodology used in this rating was the Global Healthcare Service Providers published in December 2011. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Select Medical Corporation, headquartered in Mechanicsburg, PA, provides long-term acute care hospital services and inpatient acute rehabilitative care through its specialty hospital segment. The company also provides physical, occupational, and speech rehabilitation services through its outpatient rehabilitation segment. Select Medical Corporation is a wholly owned subsidiary of Select Medical Holdings Corporation. For the year ended December 31, 2012, Select recognized net revenue in excess of $2.9 billion. SIONIX CORP: Has 99.3 Million Common Shares Resale Prospectus ------------------------------------------------------------- Sionix Corporation filed with the U.S. Securities and Exchange Commission a Form S-1 prospectus covering the resale by Bonanza Creek Partners, LP, Jeffrey Crouth, Jeffrey Fleeman, et al., of up to 99,352,206 shares of the Company's common stock which include: * 10,164,706 shares of common stock issued as a result of the conversion of the Company's 8% convertible notes; * 58,250,000 shares of common stock underlying 10% convertible notes; * 5,125,000 shares of common stock underlying 10% convertible notes related to the penalty for filing this Form S-1 late; and * 25,812,500 shares of common stock underlying common stock purchase warrants. The Company's common stock is quoted by the Over-the-Counter Bulletin Board under the symbol "SINX." On Feb. 1, 2013, the closing price per share of the Company's common stock was $0.02. A copy of the Form S-1 prospectus is available for free at: http://is.gd/gyb2H8 About Sionix Corp. Los Angeles, Calif.-based Sionix Corporation designs, develops, markets and sells cost-effective water management and treatment solutions intended for use in the oil and gas, agriculture, disaster relief, and municipal (both potable and wastewater) markets. Sionix incurred a net loss of $5.76 million for the year ended Sept. 30, 2012, compared with a net loss of $6.30 million during the prior year. The Company's balance sheet at Sept. 30, 2012, showed $2.90 million in total assets, $4.02 million in total liabilities, all current, and a $1.11 million total stockholders' deficit. Kabani & Company, Inc., in Los Angeles, California, 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 incurred cumulative losses of $37,560,000. In addition, the company has had negative cash flow from operations for the years ended Sept. 30, 2012, of $2,568,383. These factors raise substantial doubt about the Company's ability to continue as a going concern. SMART & FINAL: Term Loan Amendment No Impact on Moody's 'B3' CFR ---------------------------------------------------------------- Moody's Investors Service said that Smart & Final Holdings Corp.'s announcement that it is seeking an amendment to reduce the coupon of its $525 million first lien term loan will not have any immediate effect on the B3 corporate family rating or stable outlook of its parent SF CC Intermediate Holdings, Inc. The amendment will also not affect the Ba2 rating of the company's ABL revolving credit facility, the B3 rating of the first lien term loan facility or the Caa2 rating of the second lien term loan facility. The principal methodology used in rating SF CC Intermediate Holdings, Inc. was the Global Retail Industry Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Smart & Final Holdings Corp. is headquartered in Commerce, California, and operates 235 non-membership warehouse club stores serving retail and commercial customers in six western states and northern Mexico under the Smart & Final and Cash & Carry banners. SOMERSET THOR: Updated Case Summary & Creditors' Lists ------------------------------------------------------ Lead Debtor: Somerset Thor Building Realty Holdings, LP 237 South Street Morristown, NJ 07962-2049 Bankruptcy Case No.: 13-12660 Chapter 11 Petition Date: February 11, 2013 Court: United States Bankruptcy Court District of New Jersey (Newark) Judge: Novalyn L. Winfield Debtor's Counsel: Morris S. Bauer, Esq. NORRIS MCLAUGHLIN & MARCUS, PA P.O. Box 5933 Bridgewater, NJ 08807-5933 Tel: (908) 722-0700 Fax: (908) 722-0755 E-mail: msbauer@nmmlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 Affiliates that simultaneously filed separate Chapter 11 petitions: Debtor Case No. ------ -------- S B Building Associates 13-12682 Limited Partnership Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 SB Milltown Industrial Realty 13-12685 Holdings, LLC Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 Alsol Corporation 13-12689 Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 The petitions were signed by Lawrence S. Berger, president of general partner and authorized agent. Affiliates that previously sought Chapter 11 protection: Petition Debtor Case No. Date ------ -------- ---- 400 Blair Realty Holdings, LLC 11-37887 09/23/11 Berley Associates, Ltd. 12-32032 09/05/12 Route 88 Office Associates, Ltd. 12-32431 09/11/13 A. A copy of Somerset Thor Building's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/njb13-12660.pdf B. A copy of S B Building's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/njb13-12682.pdf C. A copy of SB Milltown's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/njb13-12685.pdf D. A copy of Alsol Corporation's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/njb13-12689.pdf STARZ LLC: Sony Output Deal No Impact on Moody's 'Ba2' CFR ---------------------------------------------------------- Moody's Investors Service said Starz, LLC's announced five-year extension of its first-run premium pay-TV output agreement with Sony Pictures Entertainment ensures an important source of programming through at least 2021 and is credit positive for the premium cable network. Starz's Ba2 Corporate Family Rating and stable rating outlook are not affected. The principal methodology used in rating Starz was the Global Broadcast and Advertising Related Industries published in May 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Starz, headquartered in Englewood, Colorado, supplies television and movie programming to U.S. multichannel video distributors including cable, direct broadcast satellite, and telecommunication service providers. Primary operations consist of the Starz and Encore premium cable networks. Starz Media operates home video and theatrical distribution businesses as well as other programming- related services including managing for a distribution fee the ancillary revenue and expenses of Starz's original programming content. Revenue for the 12 months ended September 2012 was approximately $1.6 billion. STEREOTAXIS INC: Franklin Resources Holds 19.2% Equity Stake ------------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Franklin Resources, Inc., and its affiliates disclosed that, as of Dec. 31, 2012, they beneficially own 1,636,640 shares of common stock of Stereotaxis, Inc., representing 19.2% of the shares outstanding. Franklin Resources previously reported beneficial ownership of 1,636,640 common shares or a 19.4% equity stake as of Sept. 30, 2012. A copy of the amended filing is available at http://is.gd/20gAle 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. TEAM FINANCIAL: FDIC Expert Testimony Barred in Tax Refund Suit --------------------------------------------------------------- In the action styled, TEAM FINANCIAL INC., TEAM FINANCIAL, ACQUISITION SUBSIDIARY, INC., and POST BANCORP, INC., Plaintiffs, v. FEDERAL DEPOSIT INSURANCE CORPORATION, Defendant, Adv. Proc. No. 09-5084 (Bankr. D. Kan.), Chief Bankruptcy Judge Robert E. Nugent issued an order sustaining the Plaintiffs' objection to admission of expert testimony proffered by the FDIC. The plaintiffs are bank holding companies and members of a consolidated tax group. They filed the adversary proceeding to determine whether $4.0 million in tax refunds generated by certain consolidated tax returns are property of the bankruptcy estates under a 2008 Tax Allocation Agreement and whether those refunds are subject to turnover. The FDIC contends that as the receiver of the failed banks once owned by the holding companies, it is entitled to recover the tax refunds as property of the banks. During pretrial proceedings, the FDIC designated two attorneys as expert witnesses whose opinions are proffered regarding the proper interpretation of the TAA. The debtors object to the admission of that expert testimony. The proffered opinions are legal opinions on matters within the competence of the Court as the trier of law and are therefore inadmissible as expert opinions. In March 2009, the FDIC was appointed receiver for the debtors' failed banks. The debtors filed separate chapter 11 petitions on April 5, 2009 and commenced the adversary proceeding on May 22, 2009. During the pendency of this litigation, the parties agreed that plaintiffs would file the necessary tax returns and any tax refunds collected would be held in a segregated bank account, pending a determination of the parties' respective interests therein. The Debtors have filed their disclosure statement and chapter 11 plan of liquidation; the tax refunds at issue are the primary asset of the bankruptcy estates and an evidentiary hearing on confirmation will be deferred until the adversary is resolved. FDIC moved for partial summary judgment early on, contending that under the TAA as interpreted in light of Treas. Reg. Sec. 1.1502- 77, Team Financial holds the tax refunds as agent or trustee for the consolidated tax group and for the benefit of the affiliated entities, and thereby has nothing more than bare legal title to the funds, effectively excluding them from Team Financial's bankruptcy estate by operation of 11 U.S.C. Sec. 541(d). In a Memorandum Opinion issued April 27, 2010, the Court rejected the FDIC's position and denied the motion. During discovery, the FDIC designated two expert witnesses to opine on the meaning of the TAA. The Team Financial plaintiffs objected. Discovery is completed, the final pretrial order was entered on Dec. 4, 2012, and the matter is set for trial beginning on March 4, 2013. A copy of the Court's Feb. 7, 2013 Order is available at http://is.gd/kpCdOSfrom Leagle.com. About Team Financial Team Financial Inc. is a financial holding company. The Company offers a range of community banking and financial services through 21 locations in Kansas, Missouri, Nebraska and Colorado through its banking subsidiaries, Team Bank and Colorado National Bank. Its presence in Kansas consists of nine locations in the Kansas City metropolitan area and three locations in southeast Kansas. The Company operates at two locations in south-western Missouri, three in metropolitan Omaha, Nebraska, and four in metropolitan Colorado Springs, Colorado. The Company offers financial services to its retail and commercial banking customers including personal and corporate banking services, mortgage banking, trust and estate planning, and personal investment financial counseling services. Team Financial and subsidiaries, Team Financial Acquisition Subsidiary, Inc., and Post Bancorp, Inc., sought Chapter 11 bankruptcy protection (Bankr. D. Kansas Case Nos. 09-10925 to 09-10927). Edward J. Nazar, Esq., at W. Thomas Gilman, Esq., at Redmond & Nazar, L.L.P., in Wichita, Kansas, represent the Debtors as counsel. In its petition, Team Financial Inc. listed $692,410 in total assets and $26,681,000 in total debts. TELETOUCH COMMUNICATIONS: Obtains $6MM Revolver Loan From DCP ------------------------------------------------------------- Teletouch Communications, Inc., said that after the market close on Friday, Feb. 8, 2013, it entered into a new, two-year, $6 million senior secured asset-based revolving credit facility, with a starting interest rate of 14% per annum, such facility also providing for an additional multiple use, short term loan facility of up to $2 million per loan for special order inventory purchase transactions with DCP Teletouch Lender, LLC, a special purpose entity created by New York-based, Downtown Capital Partners, LLC. The Revolver contemplates interest rate reductions of 1% per quarter (to a minimum of no less than 11%) in the event the Company achieves certain minimum quarterly EBITDA targets. The Term Loans component of the DCP Loan Facility is designed to satisfy out-of-cycle customer orders to facilitate inventory purchases at times and prices favorable to the Borrower. The Term Loans are not a committed credit facility and the financial terms, including interest rates and fees of each of any such Term Loans will be determined on a case-by-case basis and remain entirely within the discretion of the Lender. The DCP Credit Facility may be extended by one additional year at the Company's sole election, providing for an up to three year total term. Teletouch is using the initial funds drawn from the facility to replace and pay-down its original loans and indebtedness with Thermo Credit LLC; pay closing costs associated with the financing; and, use the remainder for general corporate and working capital purposes. New York City-based, Bryant Park Capital, Inc., acted as exclusive financial advisor to Teletouch for the transaction. As prior reported, the Thermo Facility was originally set to mature in January 2013. However, at the start of 2012, Thermo Credit informed the Company that it was not in compliance with its own borrowing base facility with Capital One Bank, N.A., and could no longer lend additional monies or fulfill any further revolving credit obligations to the Company. Subsequently, the parties entered into various negotiations and agreements, whereby the maturity of the Thermo Facility was reset to August 2012, while the Company worked to replace the Thermo Facility altogether. As a party to this new transaction, Thermo and the Company entered into Amendment No. 6, pursuant to which Teletouch agreed to apply at the closing of the DCP Credit Facility, $4 million from the proceeds of the financing, thereby reducing the current balance on the prior Thermo Facility from $7.148 million to a current new principal balance of $3.148 million. "Although the process has been extremely challenging, the new $6 million asset-based revolving loan facility, combined with the potential of the additional $2 million-per-transaction stand-by term loan facility, positions the Company well to take advantage of the various components of its emerging wholesale distribution business," stated T. A. "Kip" Hyde, Jr., president, chief operating officer and Director of Teletouch. "Just as important, firmly resolving the ongoing credit matters with Thermo Credit now allows our management team to focus on growing the business, especially with the greater flexibility and additional credit lines that our new lender provides. Completing this new credit facility was a team effort, and we look forward to growing the business together." 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. 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. TITAN PHARMACEUTICALS: First Eagle Discloses 9.9% Equity Stake -------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, First Eagle Investment Management, LLC, disclosed that, as of Dec. 31, 2012, it beneficially owns 7,446,205 shares of common stock of Titan Pharmaceuticals, Inc., representing 9.9% of the shares outstanding. A copy of the filing is available for free at http://is.gd/vUwLol About Titan Pharmaceuticals South San Francisco, California-based Titan Pharmaceuticals is a biopharmaceutical company developing proprietary therapeutics primarily for the treatment of central nervous system disorders. The Company's balance sheet at Sept. 30, 2012, showed $10.74 million in total assets, $37.87 million in total liabilities, and a $27.13 million total stockholders' deficit. Following the 2011 results, OUM & Co. LLP, in San Francisco, California, expressed substantial doubt about Titan's ability to continue as a going concern. The independent auditors noted that the Company's cash resources will not be sufficient to sustain its operations through 2012 without additional financing, and that the Company also has suffered recurring operating losses and negative cash flows from operations. TRANSDIGM INC: S&P Assigns 'BB-' Rating on New $2.51BB Facility --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' rating to TransDigm Inc.'s proposed $2.51 billion senior secured first-lien credit facility. The '2' recovery rating indicates S&P's expectations of a substantial (70%-90%) recovery in the event of payment default. The facility consists of a $310 million revolver and $2.2 billion term loan, and the company plans to use the proceeds to refinance their existing credit facility. The refinancing will extend the maturity of the revolver by three years and the term loan by two years and also result in a minimal debt increase of approximately $30 million. S&P's ratings on TransDigm reflect its well-established positions in niche markets for highly engineered aircraft components, efficient operations, very high profit margins, good product diversity, participation in the cyclical and competitive commercial aerospace industry, and "adequate" liquidity (as defined in S&P's criteria). S&P assess the company's business risk profile as "fair" and its financial risk profile as "highly leveraged." For the complete recovery analysis, please see the recovery report on TransDigm, to be published on RatingsDirect following this report. RATINGS LIST TransDigm Inc. Corporate credit rating B+/Stable/-- New Ratings TransDigm Inc. Senior secured $310 mil revolver BB- Recovery rating 2 $2.2 bil term loan BB- Recovery rating 2 TRILLIUM FAMILY: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Trillium Family Solutions, Inc. 624 Market Ave., N. Canton, OH Canton Bankruptcy Case No.: 13-60278 Chapter 11 Petition Date: February 11, 2013 Court: United States Bankruptcy Court Northern District of Ohio (Canton) Judge: Russ Kendig Debtor's Counsel: Anthony J. DeGirolamo, Esq. 116 Cleveland Ave., N.W. Suite 307 Canton, OH 44702 Tel: (330) 588-9700 Fax: (330) 588-9713 E-mail: ajdlaw@sbcglobal.net Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/ohnb13-60278.pdf The petition was signed by Kathy Trubisky, president/CEO. UNIVERSAL HEALTH: Hearing Today on BankUnited Bid for Dismissal --------------------------------------------------------------- The Bankruptcy Court will convene a hearing today, Feb. 14, to consider an emergency motion of BankUnited, N.A., for dismissal of Universal Health Care Group Inc.'s Chapter 11 case, or in the alternative, relief from the automatic stay. BankUnited, the administrative agent for lenders owed $36.5 million, explains that Universal's assets and the bank's collateral are the equity interests in insurance company Universal Health Care Insurance Co., Inc. -- UHCIC -- and health maintenance organizations Universal Health Care, Inc. -- UHC -- Universal HMO of Texas, Inc., and Universal Health Care of Nevada. The bank claims that the Debtor's bankruptcy filing was designed to disrupt the bank's scheduled sale of the equity interests under Article 9 of the Florida Uniform Commercial Code, which was set Feb. 19. The Article 9 Sale was properly noticed and was intended to, among other things, avert the expedited liquidation of UHC and UHCIC for their longstanding failure to maintain more than $68 million in capital surplus statutorily required under Florida law. As a result of the Debtor's filing, however, Florida regulators has commenced two separate state court proceedings in Leon County, Florida, which seek to place both UHC and UHCIC into receivership. As such, pursuant to section 631.041(1)(a) of the Florida Statutes, "the commencement or continuation of judicial, administrative, or other action or proceeding against the insurer or against its assets or any part thereof" is immediately stayed. Similarly, regulators with the Texas Department of Insurance have informed counsel to BankUnited that they intend to immediately commence a proceeding to place Universal of Texas into receivership. It is expected that the State of Nevada will follow suit. BankUnited notes that regulators' authority over the insurance company and the HMOs is not impacted by the Debtor's filing. Upon being placed into receivership, the members or participants that form the basis for the revenues of all of the Debtor's subsidiaries will be reassigned to other statutorily eligible HMOs or insurance companies by the Center for Medicare and Medicaid Services, with no value flowing to the estate. As a result, Universal holding company will end up with no assets. "Stated differently, absent authorization to immediately proceed with the Article 9 Sale, the Pledged Equity Interests will be rendered worthless shares of stock in entities with no members, no revenues, and no ability or authority to conduct business," BankUnited says in court filings. Accordingly, the bank wants the Chapter 11 case of the holding company dismissed so it can complete foreclosure of the operating companies. The bank says that if it forecloses, it may be able to stop the receivership of the operating companies, sell the businesses, and thus preserve some of its collateral. BankUnited is represented by: Frank P. Terzo, Esq. Steven J. Solomon, Esq. Fernando J. Menendez, Esq. GRAYROBINSON, P.A. 1221 Brickell Avenue, Suite 1600 Miami, FL 33131 Tel: (305) 416-6880 Fax: (305) 416-6887 About Universal Health Care Universal Health Care Group, Inc., owns an insurance company and three health-maintenance organizations that provide managed care services for government sponsored health care programs, focusing on Medicare and Medicaid. Universal Health was founded in 2002 by Dr. A.K. Desai and grew its operations of offering Medicare plans to more than 37,000 members to over 20 states. Universal Health filed a Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 13-01520) on Feb. 6, 2013, after Florida regulators moved to put two of the company's subsidiaries in receivership. Universal Health Care estimated assets of up to $100 million and debt of less than $50 million in court filings in Tampa, Florida. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, in Tampa, serves as counsel to the Debtor. UNIVERSAL HEALTH: BankUnited Seeks Bar on Use of Cash, Tax Refund ----------------------------------------------------------------- BankUnited, N.A., filed a motion asking the Bankruptcy Court to enter an order pursuant to Sections 363(c)(2), 363(e) and 105(a) of the Bankruptcy Code prohibiting debtor Universal Health Care Group, Inc., from using cash collateral. BankUnited says it does not consent to the Debtors' use of cash collateral. Although the Debtor has not requested access to cash collateral, the bank seeks to protect its interests and ensure that the secured parties' cash collateral, including, but not limited to, any dividend distributions from the regulated subsidiaries' to the Debtor are not used to pay expenses or fees in connection with the Chapter 11 case. BankUnited, the administrative agent for lenders owed $36.5 million, explains that Universal's assets and the bank's collateral are the equity interests in insurance company Universal Health Care Insurance Co., Inc. -- UHCIC -- and health maintenance organizations Universal Health Care, Inc. -- UHC -- Universal HMO of Texas, Inc., and Universal Health Care of Nevada. In addition, BankUnited says it has been advised that the Debtor anticipates receiving a consolidated income tax refund of $5,000,000 in the near future. BankUnited wants the Court to prohibit the Debtor from distributing the tax refund, or any portion thereof. About Universal Health Care Universal Health Care Group, Inc., owns an insurance company and three health-maintenance organizations that provide managed care services for government sponsored health care programs, focusing on Medicare and Medicaid. Universal Health was founded in 2002 by Dr. A.K. Desai and grew its operations of offering Medicare plans to more than 37,000 members to over 20 states. Universal Health filed a Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 13-01520) on Feb. 6, 2013, after Florida regulators moved to put two of the company's subsidiaries in receivership. Universal Health Care estimated assets of up to $100 million and debt of less than $50 million in court filings in Tampa, Florida. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, in Tampa, serves as counsel to the Debtor. UNIVERSAL HEALTH: Taps Katten Muchin as General Bankruptcy Counsel ------------------------------------------------------------------ Universal Health Care Group, Inc., filed an application to employ Katten Muchin Rosenman LLP as general bankruptcy counsel, nunc pro tunc to the Petition Date. Katten has represented the Debtor previously with respect to the negotiation of a secured credit facility. As a result of the foregoing, Katten has become intimately familiar with the Debtor's business, corporate and capital structure, and its financial posture. The Debtor believes the employment of Katten will enhance and will not duplicate the services to be provided by the Debtor's local general bankruptcy counsel, Strichter, Riedel, Blain & Prosser, P.A., and the employment of other professionals retained by the Debtor to perform specific tasks that are unrelated to the work to be performed by Katten. Katten intends to (a) charge for its legal services in tenths of hours in accordance with its ordinary and customary hourly rates in effect on the date services are rendered and (b) seek reimbursement of actual and necessary out-of-pocket expenses. Katten has advised the Debtor that the current hourly rates for the attorneys proposed to actively represent the Debtor are: Professional Hourly Rate ------------ ----------- Kenneth E. Noble $850 Jeff J. Friedman $880 Matthew W. Olsen $650 Kevin M. Baum $430 Bertrand J. Choe $410 Generally, Katten's hourly rates are in these ranges: Title Hourly Rate ----- ----------- Partners $645 to $1,090 Associates $345 to $665 Paralegals $160 to $420 The Debtor believes Katten and its attorneys are "disinterested" as required by Section 327(a) of the Bankruptcy Code and Bankruptcy Rule 2014. The Debtor's bankruptcy attorneys can be reached at: KATTEN MUCHIN ROSENMAN LLP 575 Madison Avenue New York, NY 10022 About Universal Health Care Universal Health Care Group, Inc., owns an insurance company and three health-maintenance organizations that provide managed care services for government sponsored health care programs, focusing on Medicare and Medicaid. Universal Health was founded in 2002 by Dr. A.K. Desai and grew its operations of offering Medicare plans to more than 37,000 members to over 20 states. Universal Health filed a Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 13-01520) on Feb. 6, 2013, after Florida regulators moved to put two of the company's subsidiaries in receivership. Universal Health Care estimated assets of up to $100 million and debt of less than $50 million in court filings in Tampa, Florida. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, in Tampa, serves as counsel to the Debtor. UNIVITA HEALTH: Weak Performance Cues Moody's to Cut CFR to 'B3' ---------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating for Univita Health, Inc., to B3 from B2. The company's Probability of Default Rating of B3-PD and the B2 (LGD 3, 34%) rating on the $220 million senior secured credit facilities were affirmed. The rating outlook is stable. The rating actions are as follows: Rating downgraded: Corporate Family Rating downgraded to B3 from B2 Ratings affirmed and Loss Given Default point estimate adjusted: Probability of Default Rating at B3-PD $20 million senior secured revolving credit facility expiring 2016 at B2 (LGD 3, 34%) $200 million senior secured term loan due 2017 at B2 (LGD 3, 34%) Ratings Rationale: The downgrade of CFR to B3 reflects the company's weak operating performance that continues to fall short of budget and Moody's expectation, and the resultant deterioration in credit metrics and weakened liquidity. The company's revenue and EBITDA growth are tracking below expectations due to delays in implementing new contracts within its Integrated Homecare segment, while at the same time infrastructure investments are increasing in part due to the recent acquisition within this segment. In addition, Moody's is concerned about the deteriorating margin trend -- which accelerated in the most recent quarter, largely caused by increase in homecare service utilization rates and company's inability to offset the negative impact in a timely manner. Since the majority of Univita's homecare services are provided under flat-rate capitated contracts, higher volume (utilization rate) will lead to lower profitability. Moody's expects that the downward margin pressure will likely persist for the foreseeable future, offsetting the modest revenue growth expected for the next year. As a result, Moody's does not expect the company's credit metrics will meaningfully recover in the next 12 months. As of September 30, 2012, the company's leverage was around 5.5x and its free cash flow was negative. Univita's B3 Corporate Family Rating is constrained by its relatively small scale, geographic concentration in Florida and high customer/product concentration -- all limiting factors that make it vulnerable to margin pressure. The rating also incorporates ongoing execution risks associated with company's growth strategy and lingering reimbursement pressures facing many of its payers. Moody's expects that the company's leverage will remain high at above 5.0 times and interest coverage weak at around 1.0x (EBITDA-Capex/interest) in the near to medium term. Positive rating consideration is given to Univita's good revenue visibility associated with its Insurance Administration Services (around 30% of its total revenues) and stable customer relationships in this segment. The stable outlook reflects Moody's expectation that Univita's EBITDA will increase very modestly next year, driven by top-line growth from the homecare segment offset by continued margin pressures due to the utilization headwinds and unfavorable product mix. The stable outlook also incorporates some volatility in future revenue and earnings -- typical for a small growth oriented company like Univita. Moody's also expects the company to reverse its negative free cash flow to break-even or slightly positive and maintain undisrupted access to its revolving credit facility over the next 12 months. Moody's notes that the cushion under financial covenants will tighten in the fourth quarter 2013 due to scheduled adjustment, however, the rating agency does not expect a covenant breach at this time. The ratings could face downward pressure if Univita is unable to stabilize margins or reverse its negative free cash flow. Deterioration of liquidity for any reason could result in a downgrade. A loss of significant contracts/customers could also exert negative pressure on ratings. Quantitatively, the rating could be downgraded if debt/EBITDA increases above 6 times or (EBITDA-Capex)/interest fails to improve and remain above 1.1x. An upgrade is unlikely over the near-term, given the company's small revenue base, earnings volatility and unfavorable industry headwinds from reimbursement cuts. Over the medium term, a material expansion of the revenue base, stabilization of margins and an improvement in credit metrics leading to sustained leverage in the low 4 times range to compensate for size could result in a rating upgrade. The principal methodology used in this rating was the Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Eden Prairie, MN, Univita operates in three areas. Its Integrated Home Care unit provides sub-acute healthcare services to patients in their homes. Its Insurance Administration Services unit provides BPO services including application processing, underwriting services and policy administration claims services on behalf of insurers. Its Engagement unit provides health assessments and care planning services to enable independent aging. Univita is majority owned by financial sponsor Genstar Capital, LLC and management. VIGGLE INC: To Issue Additional 15 Million Shares Under Plan ------------------------------------------------------------ Viggle Inc. filed a Form S-8 with the U.S. Securities and Exchange Commission for the purpose of registering an additional 15,000,000 shares of common stock which may be issued as a result of an increase in the number of shares issuable under the Company's 2011 Executive Incentive Plan. The board of directors of the Company amended the Plan to increase the total number of shares issuable under the Plan to 30,000,000 shares. A copy of the Form S-8 prospectus is available for free at http://is.gd/aBO6qo About Viggle New York City-based Viggle Inc. is a loyalty marketing company. The Company has developed a loyalty program for television that gives people real rewards for checking into the television shows they are watching on most mobile operating system. Viggle users can redeem their points in the app's rewards catalog for items such as movie tickets, music, or gift cards. The Company's balance sheet at Sept. 30, 2012, showed $17.3 million in total assets, $22.2 million in total liabilities, and a stockholders' deficit of $4.9 million. As reported in the TCR on Oct. 22, 2012, BDO USA, LLP, in New York City, expressed substantial doubt about Viggle's ability to continue as a going concern. The independent auditors noted that the Company has suffered recurring losses from operations and at June 30, 2012, has deficiencies in working capital and equity. VISUALANT INC: Incurs $701,000 Net Loss in Dec. 31 Quarter ---------------------------------------------------------- Visualant, Incorporated, filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $700,936 on $2.05 million of revenue for the three months ended Dec. 31, 2012, as compared with a net loss of $554,866 on $1.81 million of revenue for the same period a year ago. Visualant incurred a net loss of $2.72 million for the year ended Sept. 30, 2012, compared with a net loss of $2.39 million for the same period during the prior year. The Company's balance sheet at Dec. 31, 2012, showed $4.69 million in total assets, $4.94 million in total liabilities, $38,490 in noncontrolling interest and a $280,232 total stockholders' deficit. "The Company anticipates that it will record losses from operations for the foreseeable future. As of December 31, 2012, our accumulated deficit was $14.6 million. The Company has limited capital resources, and operations to date have been funded with the proceeds from private equity and debt financings. These conditions raise substantial doubt about our ability to continue as a going concern. The audit report prepared by our independent registered public accounting firm relating to our financial statements for the year ended September 30, 2012 includes an explanatory paragraph expressing the substantial doubt about our ability to continue as a going concern." PMB Helin Donovan, LLP, in Nov. 10, 2012, 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 sustained a net loss from operations and has an accumulated deficit since inception which raise substantial doubt about the Company's ability to continue as a going concern. A copy of the Form 10-Q is available for free at: http://is.gd/Pfxdj0 About Visualant Inc. Seattle, Wash.-based Visualant, Inc., was incorporated under the laws of the State of Nevada on Oct. 8, 1998. The Company develops low-cost, high speed, light-based security and quality control solutions for use in homeland security, anti- counterfeiting, forgery/fraud prevention, brand protection and process control applications. WESTMORELAND COAL: T. Rowe Price Discloses 5.4% Equity Stake ------------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, T. Rowe Price Associates, Inc., disclosed that, as of Dec. 31, 2012, it beneficially owns 772,800 shares of common stock of Westmoreland Coal Co. representing 5.4% of the shares outstanding. T. Rowe Price previously reported beneficial ownership of 774,320 common shares or a 5.6% equity stake as of Dec. 31, 2011. A copy of the amended filing is available at: http://is.gd/CjGidH About Westmoreland Coal Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest independent coal company in the United States. The Company's coal operations include coal mining in the Powder River Basin in Montana and lignite mining operations in Montana, North Dakota and Texas. Its power operations include ownership of the two-unit ROVA coal-fired power plant in North Carolina. The Company reported a net loss of $36.87 million in 2011, a net loss of $3.17 million in 2010, and a net loss of $29.16 million in 2009. The Company's balance sheet at Sept. 30, 2012, showed $971.15 million in total assets, $1.22 billion in total liabilities and a $252.74 million total deficit. * * * As reported by the TCR on Nov. 6, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Englewood, Co.-based Westmoreland Coal Co. (WLB). to 'B-' from 'CCC+'. "The upgrade reflects our view that WLB is less vulnerable to default after successfully negotiating less restrictive covenant requirements for an unrated $110 million term loan due 2018," said credit analyst Gayle Bowerman. "Our assessment of WLB's business risk profile as 'vulnerable' and financial risk profile as 'highly leveraged' are unchanged. We also revised our liquidity score to 'adequate' based on the covenant relief and additional liquidity provided under the company's new $20 million asset-based loan (ABL) facility from 'less than adequate'." Westmoreland Coal carries a Caa1 corporate family rating from Moody's Investors Service. WHITTYMORE LLC: Case Summary & 5 Unsecured Creditors ---------------------------------------------------- Debtor: Whittymore, LLC 1943 E. US Highway 50 Brownstown, IN 47220 Bankruptcy Case No.: 13-90281 Chapter 11 Petition Date: February 11, 2013 Court: United States Bankruptcy Court Southern District of Indiana (New Albany) Judge: Basil H. Lorch III Debtor's Counsel: Caroline Ellona Richardson, Esq. David H Kleiman, Esq. Wendy D. Brewer, Esq. BENESCH FRIEDLANDER COPLAN ARONOFF LLP One American Square, #2300 Indianapolis, IN 46282 Tel: (317) 632-3232 Fax: (317) 632-2962 E-mail: crichardson@beneschlaw.com dkleiman@beneschlaw.com wbrewer@beneschlaw.com Scheduled Assets: $5,249,500 Scheduled Liabilities: $7,492,959 A copy of the Company's list of its five largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/insb13-90281.pdf The petition was signed by Dillard Whittymore, III, owner. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Dillard Whittymore, III 12-91998 09/10/12 ZALE CORP: Dimensional Fund Discloses 8.4% Equity Stake ------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Dimensional Fund Advisors LP disclosed that, as of Dec. 31, 2012, it beneficially owns 2,704,438 shares of common stock of Zale Corp. representing 8.36% of the shares outstanding. Dimensional Fund previously reported beneficial ownership of 2,414,259 common shares or a 7.5% equity stake as of Dec. 31, 2011. A copy of the amended filing is available at: http://is.gd/bwtyro About Zale Corporation Based in Dallas, Texas, Zale Corporation (NYSE: ZLC) -- http://www.zalecorp.com/-- is a specialty retailer of diamonds and other jewelry products in North America, operating approximately 1,900 retail locations throughout the United States, Canada and Puerto Rico, as well as online. Zale Corporation's brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale also operates online at http://www.zales.com/, http://www.zalesoutlet.com/, http://www.gordonsjewelers.com/and http://www.pagoda.com/ Zale Corp. incurred a net loss of $27.31 million for the year ended July 31, 2012, a net loss of $112.30 million for the year ended July 31, 2011, and a net loss of $93.67 million for the year ended July 31, 2010. Zale Corp's balance sheet at Oct. 31, 2012, showed $1.33 billion in total assets, $1.18 billion in total liabilities and $151.96 million in total stockholders' investment. * More Stable Airlines Fly Out of Mergers ----------------------------------------- Susan Carey, Jack Nicas and Mike Spector, writing for The Wall Street Journal, reported that the U.S. airline industry is starting to fly high again as an expected merger agreement between AMR Corp. and US Airways could end the latest chapter on consolidation that has helped to stabilize an industry troubled for decades. WSJ said the $10 billion-plus deal would follow three other industry mega-mergers since 2008, a period of consolidation that has produced a healthier industry with the prospects of sustainable profitability and investment-grade credit ratings. Travelers would have fewer airline choices -- an AMR-US Airways merger would leave four airlines controlling about 83% of domestic seats -- but potentially the benefits of greater reliability and airline investments, the report added. WSJ, citing people familiar with the matter, said the AMR and US Airways boards are scheduled to meet separately on Wednesday to consider the merger plan, which could be announced later that day or on Thursday if the timing doesn't slip. US Airways Chief Executive Doug Parker would run the combined carrier as CEO, while AMR CEO Tom Horton would become nonexecutive chairman for a limited period. Current talks are focused on the length of Mr. Horton's term, the makeup of the new board and potential compensation for the airline's new management and other employees, these people said. * Libor Scrutiny Turns to Middlemen ----------------------------------- Jean Eaglesham and Evan Perez, writing for The Wall Street Journal, reported that U.S. regulators are widening their probe of global interest-rate-rigging by scrutinizing what they claim is a pivotal role of two U.K. brokerage firms in the scandal, people close to the investigation say. WSJ said the Justice Department and Commodity Futures Trading Commission are examining ICAP PLC and R.P. Martin Holdings Ltd., so-called interdealer brokers that are go-betweens for banks seeking buyers or sellers for hard-to-trade assets. The brokers, both with headquarters in London, also help some banks decide their submissions for the London interbank offered rate, or Libor, and other benchmarks that underpin trillions of dollars in mortgages and other financial contracts. While neither firm has been accused of wrongdoing, regulators allege that some of their employees were crucial in helping specific traders rig submissions by banks of estimated borrowing costs in different currencies, the report said. According to the WSJ report, U.S. officials made references to ICAP and R.P. Martin in documents released as part of recent settlements by UBS AG and Royal Bank of Scotland Group, PLC, without identifying the brokerage firms. * U.S. Banks' Bulk Distressed Loan Sales to Grow, Fitch Reports --------------------------------------------------------------- U.S. banks holding large levels of nonperforming assets (NPAs) on their balance sheets are likely to pursue more bulk sales of distressed loans this year and next, according to Fitch Ratings. Four years after non-accruals began to spike during the financial crisis, many smaller institutions with large residual NPA balances, particularly related to commercial loans, will be in a better position to use bulk sales to strengthen balance sheets if market liquidity and asset pricing continue to improve in 2013. "We see tightening risk spreads reflecting an influx of yield- starved investors such as hedge funds, high-yield asset managers, and other lightly regulated entities seeking higher returns in a continued low interest rate environment," Fitch says. "Recent asset dispositions by U.S. banks, including Synovus Financial (SNV), SunTrust (STI), and Hancock Holding Co. (HBHC) point toward a more active market for distressed assets. Synovus began a distressed asset disposition sale in 2009, but hadn't done a bulk loan sale since 2010 when many other institutions were attempting to unload underperforming assets. The company sold $530 million in NPAs in fourth-quarter 2012, realizing $155 million in related chargeoffs, or a 30% loss rate. We note that many of the NPAs had likely already been written down from their respective unpaid balance. However, this appears to be an improvement from SNV's last outsized NPA sale in fourth-quarter 2010 when it sold $573 million of assets with a 40% loss rate." Meanwhile, STI sold $706 million in distressed real estate loans in the last few months of 2012, taking a similar level of charge downs at just under 30% of carrying value. In order to further clean up credit quality metrics, the company sold $2.0 billion of government-guaranteed student loans in the third- and fourth- quarter of 2012, some of which were delinquent. Successful sales will allow banks to focus more attention on core banking activities, while lowering fixed costs related to the retention of nonperforming real estate loans (including real estate taxes, property insurance, maintenance, and work-out staff). Hancock's $40 million bulk asset sale in the fourth quarter was done with these cost-savings factors in mind as communicated by management on its quarterly earnings call. HBHC noted that it will continue to evaluate NPA sales going forward. According to FDIC data, U.S. banks had $65 billion of commercial loans on non-accrual status as of Sept. 30, 2012, the majority of which are related to commercial real estate (CRE). In addition, banks reported approximately $41 billion in other real estate owned (OREO). Fitch says, "We expect banks with stubbornly high commercial- related NPAs to accelerate sales activity over the next 12 to 18 months, particularly as many CRE loans originated prior to the crisis approach maturity. Additional scrutiny of loss reserve positions by bank regulators, as well as the absence of access to attractive financing, may also increase pressure on more small and midsize banks to unload NPAs. Sales also make sense for banks in closing out regulatory actions related to asset quality. "Many institutions will likely view the successful completion of a bulk loan sale as critical in validating loan carrying values and reserves, while demonstrating their ability to work down NPA balances over time. As risk spreads for NPAs continue to tighten, many banks will likely capitalize on a window of opportunity in the secondary market, with many prospective buyers of commercial assets more willing to boost bids in a more stable CRE environment. "Ultimately, we believe that most of the benefits driven by better liquidity and pricing in bulk loan sales will be realized by institutions with commercial-heavy balance sheets. Institutions with more of a consumer-lending focus will be less likely to follow the bulk sales route, since spreads on consumer loans have not tightened as significantly given favorable consumer protection laws in many states." * Moody's Notes Decline of High-Yield Bond Covenant Protections --------------------------------------------------------------- The covenant quality of North American high-yield bonds continued to slide in January, Moody's Investors Service says in its second monthly report on its recently launched Covenant Quality Index. The index shows that covenant quality began to erode last July, at the same time that high-yield bond issuance started to climb. "Our three-month rolling average CQI deteriorated to 3.89 in January from 3.79 in December," says Alexander Dill, Head of Covenant Research at Moody's and author of "Bond Covenant Quality Resumes Slide." "The single-month score for January was 4.08, a marked deterioration from 3.55 in December and the previous low of 4.06 in November." The CQI uses a five-point scale, with 1.0 representing the strongest covenant protections and 5.0, the weakest. It peaked at 3.40 last July. But investors are not being compensated for accepting weaker covenants, Dill says. "While investors are taking on more covenant risk, average spreads to benchmark yields have tightened, fueled by strong demand and a record volume of issuance." Indeed, the average benchmark spread of bonds in Moody's High-Yield Covenant issued since October is close to the level seen in the first half of 2011, though the CQI shows much weaker covenants. Last month's decline can be explained largely by an increase in high-yield-lite issuance. High-yield lite covenant packages, which lack a restricted payments and/or a debt-incurrence covenant, accounted for 34.6% of issuance in January, compared with 3.2% in December. Continuing a recent trend to convert to high-yield lite from full high-yield covenant packages, Netflix, Lear and Crown Americas all issued bonds with high-yield lite packages last month. January also saw a higher percentage of bonds rated Ba, which generally have high-yield-lite covenant packages or full covenant packages with low covenant quality. These accounted for 58% of issuance in January, compared with the average of 27% since Moody's began tracking the CQI in January 2011. * 2012 Downgrades on Non-Profit Healthcare Debts Reach $20-Bil. --------------------------------------------------------------- Moody's Investors Service downgraded a record $20 billion in US not-for-profit healthcare debt in 2012, an increase of 213% from the $6.4 billion downgraded in 2011, and the highest amount of downgraded debt in one year in the sector since the rating agency began tracking the metric in 1995. The $20 billion in downgraded debt was more than double the year's $9.7 billion of upgraded debt, according to the rating agency report, "US Not-For-Profit Healthcare Rating Activity in 2012 Sets Record for Downgraded Debt." "The downgrades in 2012 were driven by volume declines and weaker or negative revenue growth contributing to weakening operating performance and debt service coverage," said Moody's Associate Analyst Carrie Sheffield. "The downgrades were also driven by declines in liquidity, more competition, increased debt load, and many hospitals faced management and governance issues and pressures on pension funding." Three large health systems were responsible for the majority of the downgraded debt as downward revisions in ratings for Catholic Health Initiatives in Colorado, Dignity Health in California, and New York's Memorial Sloan-Kettering Cancer Center comprised nearly $13 billion of the $20 billion. Even so, the increase in the absolute level of downgraded debt in not-for-profit healthcare tracks to the reported $311 billion of public debt downgraded in 2012 across all of Moody's public finance sectors compared to $24 billion of debt upgraded. It reflects providers' continued struggle to maintain margins as tepid economic growth contributes to slow revenue and lackluster volume growth. "The industry remains under pressure from policymakers and the public to reduce costs," said Sheffield. "Medicare funding, the largest single revenue source for most not-for-profit hospitals, is a main target of federal deficit reduction plans." Medicaid revenues also remain under pressure, and some states have opted out of healthcare reform's expansion of Medicaid. Many hospitals also report single-digit to flat rate increases from commercial insurance payers, contributing to ongoing revenue pressure. Rating activity for the not-for-profit healthcare sector in 2012 marked the seventh consecutive year in which downgrades (40) outpaced upgrades (38) for a ratio of 1.05 to 1. The 38 upgrades also represent an increase over 2011's 23 upward rating revisions. "Rather than coming from fundamental credit improvement, many of the upgrades were due to consolidation as the debt of a lower- rated hospital was guaranteed by a higher-rated system upon merging," said Sheffield. "Downgrades are likely to increase in 2013 but consolidation may serve as an important check on the trend even though it sometimes causes credit deterioration." In addition to merger activity, Moody's reports that the increased number of rating upgrades in 2012 was due to favorable stock market returns of recent years, and interest rates that have allowed many hospitals to refinance or issue new debt at historically low costs. * Morgan Joseph Triartisan Aided Versa Unit in $62.5MM Financing ---------------------------------------------------------------- The Financial Restructuring Investment Banking Group of Morgan Joseph TriArtisan LLC on Feb. 11 unveiled the successful placement of $62.5 million in senior credit facilities following the formation of Civitas Media, LLC. Morgan Joseph served as a placement advisor to Civitas in connection with the financing transaction. Formed in September 2012, Civitas is a community oriented news media company formed by private equity investment firm Versa Capital Management, LLC. Civitas combined four media entities owned by Versa, including: Freedom Central, Heartland Publications, Impressions Media, and Ohio Community Media. "With this transaction, Civitas has the financial strength to focus on opportunities for its editorial and advertising professionals to serve their local communities," said James 'Jim' Decker, Head of Morgan Joseph's Financial Restructuring Group. "The new Company is now well positioned for growth." In addition to Mr. Decker, the Morgan Joseph team members involved in implementing the transaction included Jay Jacquin and Alex Fisch, Directors, and James Hadfield, Vice President. According to the Troubled Company Reporter's coverage, Ohio Community Media was formed to acquire certain newspaper assets of The Brown Publishing Company. Ohio Community Media LLC was the assignee of PNC Bank, a secured creditor of Brown. PNC agreed to pay $21,750,000 for the acquired assets. 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. Brown estimated $10 million to $50 million in assets and debts in its Chapter 11 petition. On June 16, 2011, the Court entered an order confirming Brown's 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. In May 2011, OCM LLC, an affiliate of Versa, announced it has acquired substantially all assets of Ohio Community Media. Terms of the sale were not disclosed. Heartland Publications, LLC, meanwhile, filed for Chapter 11 bankruptcy protection on Dec. 21, 2009 (Bankr. D. Del. Case No. 09-14459), after reaching an agreement with the majority of its secured first-lien lenders, led by GE Capital as agent, on a financial restructuring that will reduce the company's debt by more than half and create a new capital structure for the Company. As of Oct. 31, 2009, Heartland had $134.3 million in assets and $166.2 million in liabilities. Heartland emerged from Chapter 11 on May 1, 2010, after winning court approval of an amended pre- negotiated Reorganization Plan. About Civitas Media Civitas Media, LLC is a publisher of community newspapers in 12 Midwestern, Mid-Atlantic, and Southern states. The company includes the following media groups: Freedom Central, four daily newspapers in Illinois, Ohio and Missouri; Heartland Publications, 17 daily and 29 weekly papers across Georgia, Kentucky, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Virginia, and West Virginia; Ohio Community Media, with 13 daily and 30 weekly publications across the state of Ohio; and Impressions Media, which operates the Wilkes Barre Times Leader and other local publications in the northeastern Pennsylvania area. Civitas Media employs approximately 1,650 people. About Versa Capital Management Philadelphia-based Versa Capital Management, LLC -- http://www.Versa.com/-- is a private equity investment firm with $1.2 billion of assets under management that is focused on control investments in special situations involving middle market companies where value and performance growth can be achieved through enhanced operational and financial management. About Morgan Joseph TriArtisan Morgan Joseph TriArtisan LLC -- http://www.mjta.com/-- is an investment bank engaged in providing financial advice, capital raising and private equity investing. The firm's services include mergers, acquisitions and restructuring advice, in addition to private placements and public offerings of equity and debt. * Recent Small-Dollar & Individual Chapter 11 Filings ----------------------------------------------------- In re Laura Sarkisian Bankr. C.D. Calif. Case No. 13-13105 Chapter 11 Petition filed February 6, 2013 In re MiCasa, Inc. Bankr. N.D. Ga. Case No. 13-20365 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/ganb13-20365.pdf represented by: M. Denise Dotson, Esq. M. Denise Dotson, LLC E-mail: ddotsonlaw@me.com In re Somerset, Inc. Bankr. D. Idaho Case No. 13-00203 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/idb13-00203p.pdf See http://bankrupt.com/misc/idb13-00203c.pdf represented by: Randal J. French, Esq. Bauer & French E-mail: rfrench@bauerandfrench.com In re Durkes Painting Services LLC Bankr. D. Kans. Case No. 13-40113 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/ksb13-40113.pdf represented by: Paul D. Post, Esq. E-mail: paulpost@paulpost.com In re Kentucky Mountain Security, Inc. Bankr. E.D. Ky. Case No. 13-60151 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/kyeb13-60151.pdf represented by: Charlotte Darlene Johnson, Esq. Johnson Law Office E-mail: accandbr@gmail.com In re Howard's Deli, Inc. Bankr. D. Md. Case No. 13-11986 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/mdb13-11986.pdf represented by: Evan Jay Feldman, Esq. Law Offices for Evan J, Feldman, LLC E-mail: ejflaw@gmail.com In re James Grasso Bankr. D. Md. Case No. 13-11981 Chapter 11 Petition filed February 6, 2013 In re Azalea Peral Bankr. D. Nev. Case No. 13-10870 Chapter 11 Petition filed February 6, 2013 In re Amin & Aman Construction & Developer, Inc. Bankr. D.N.J. Case No. 13-12348 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/njb13-12348.pdf represented by: Stephen J. Cochi, Esq. E-mail: sjcochi@verizon.net In re Sirena B1, LLC Bankr. D.N.J. Case No. 13-12338 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/njb13-12338.pdf represented by: Timothy P. Neumann, Esq. Broege, Neumann, Fischer & Shaver E-mail: tneumann@bnfsbankruptcy.com In re Andres Richner Bankr. D.P.R. Case No. 13-00879 Chapter 11 Petition filed February 6, 2013 In re Jose Pares Martinez Bankr. D.P.R. Case No. 13-00878 Chapter 11 Petition filed February 6, 2013 In re Wylie Investment Group Bankr. E.D. Tex. Case No. 13-40360 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/txeb13-40360p.pdf See http://bankrupt.com/misc/txeb13-40360c.pdf represented by: Gregory W. Mitchell, Esq. E-mail: greg@mitchellps.com In re Paul Daum Bankr. N.D. Tex. Case No. 13-40615 Chapter 11 Petition filed February 6, 2013 In re Bagby/Gray Restaurant, Ltd. Bankr. S.D. Tex. Case No. 13-30779 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/txsb13-30779.pdf represented by: Christopher Adams, Esq. Okin Adams & Kilmer LLP E-mail: cadams@oakllp.com In re William-Walton, Inc. Bankr. S.D. W.Va. Case No. 13-50025 Chapter 11 Petition filed February 6, 2013 See http://bankrupt.com/misc/wvsb13-50025.pdf Represented by: George L. Lemon, Esq. E-mail: georgelemon@frontier.com In re Royal Priesthood Ministries International Inc. Bankr. M.D. Ala. Case No. 13-80171 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/almb13-80171p.pdf See http://bankrupt.com/misc/almb13-80171c.pdf Filed as Pro Se In re Corey Jacobs Bankr. S.D. Ala. Case No. 13-00395 Chapter 11 Petition filed February 7, 2013 In re Bern 2000 LLC Bankr. C.D. Calif. Case No. 13-13196 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/cacb13-13196.pdf represented by: Robert S. Altagen, Esq. LAW OFFICES OF ROBERT S. ALTAGEN, APC E-mail: rsaink@earthlink.net In re Sarasota Golf, Inc. Bankr. M.D. Fla. Case No. 13-01543 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/flmb13-01543.pdf represented by: Timothy W. Gensmer, Esq. TIMOTHY W. GENSMER, P.A. E-mail: timgensmer@aol.com In re Michael Hemmer Bankr. S.D. Fla. Case No. 13-12841 Chapter 11 Petition filed February 7, 2013 In re GetAutoInsurance.com Agency, LLC Bankr. N.D. Ga. Case No. 13-52728 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/ganb13-52728.pdf represented by: Evan M. Altman, Esq. E-mail: evan.altman@laslawgroup.com In re A-F Dolas Inc. Bankr. N.D. Ill. Case No. 13-80396 Chapter 11 Petition filed February 7, 2013 Filed as Pro Se In re Sam's NA, Inc. dba Sam's Food & Spirits Bankr. S.D. Ind. Case No. 13-90259 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/insb13-90259.pdf represented by: Neil C. Bordy, Esq. SEILLER WATERMAN LLC E-mail: bordy@derbycitylaw.com In re Four Star Family Restaurant, Inc. Bankr. E.D. Mich. Case No. 13-42247 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/mieb13-42247p.pdf See http://bankrupt.com/misc/mieb13-42247c.pdf represented by: Elias Xenos, Esq. THE XENOS LAW FIRM, PLC E-mail: etx@XenosLawFirm.Com In re Andrew Sawyer Bankr. D. Nev. Case No. 13-10922 Chapter 11 Petition filed February 7, 2013 In re Farmville Group, LLC Bankr. D. N.J. Case No. 13-12458 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/njb13-12458.pdf Filed as Pro Se In re Yugeshwarchand Rajkumar Bankr. D. N.J. Case No. 13-12487 Chapter 11 Petition filed February 7, 2013 In re National Properties of NY, Inc. Bankr. E.D.N.Y. Case No. 13-40719 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/nyeb13-40719.pdf represented by: Kenneth F. McCallion, Esq. MCCALLION & ASSOCIATES, LLP E-mail: kfm@mccallionlaw.com In re Mitsu, Inc. aka Street Corner News I Street Corner News II Bankr. S.D.N.Y. Case No. 13-22199 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/nysb13-22199.pdf represented by: Mitchell J. Canter, Esq. LAW OFFICES OF MITCHELL J. CANTER E-mail: mcanter@canterlaw.biz In re Wanda Brooks Bankr. W.D.N.C. Case No. 13-10073 Chapter 11 Petition filed February 7, 2013 In re Building Foundations, LLC aka CeCa Community Learning Day Care Center Bankr. M.D. Pa. Case No. 13-00640 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/pamb13-00640.pdf represented by: Philip W. Stock, Esq. LAW OFFICE OF PHILIP W. STOCK E-mail: pwstock@ptd.net In re Ronald Lovrich Bankr. W.D. Pa. Case No. 13-20533 Chapter 11 Petition filed February 7, 2013 In re Teatro Sat Santurce, Inc. Bankr. D. P.R. Case No. 13-00934 Chapter 11 Petition filed February 7, 2013 See http://bankrupt.com/misc/prb13-00934.pdf represented by: Jaime L. Velasco Bonilla, II, Esq. E-mail: Velascolaw@hotmail.com In re Gwendolyn Bowman Bankr. W.D. Wash. Case No. 13-40780 Chapter 11 Petition filed February 7, 2013 In re David De Best Bankr. C.D. Calif. Case No. 13-13300 Chapter 11 Petition filed February 8, 2013 In re Harbor Petroleum, Inc. Bankr. C.D. Calif. Case No. 13-10846 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/cacb13-10846.pdf represented by: Raymond H. Aver, Esq. Law Offices of Raymond H Aver APC E-mail: ray@averlaw.com In re Shadow Lane Inc. Bankr. C.D. Calif. Case No. 13-13372 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/cacb13-13372.pdf represented by: Michael D. Kwasigroch, Esq. Law Offices Of Michael D. Kwasigroch E-mail: attorneyforlife@aol.com In re Edmond Karimian Bankr. N.D. Calif. Case No. 13-50759 Chapter 11 Petition filed February 8, 2013 In re David Schoolcraft Bankr. E.D. Mich. Case No. 13-30416 Chapter 11 Petition filed February 8, 2013 In re Frontier Properties, LLC Bankr. E.D. Mo. Case No. 13-40974 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/moeb13-40974.pdf represented by: A. Thomas DeWoskin, Esq. Danna McKitrick, PC E-mail: tdewoskin@dmfirm.com In re De La Fontaine LLC Bankr. S.D.N.Y. Case No. 13-10416 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/nysb13-10416.pdf represented by: Randall S. D. Jacobs, Esq. Randall S. D. Jacobs, PLLC E-mail: rsdjacobs@chapter11esq.com In re QuickSuites, LLC Bankr. S.D.N.Y. Case No. 13-10410 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/nysb13-10410.pdf represented by: Gabriel Del Virginia, Esq. Law Offices of Gabriel Del Virginia E-mail: gabriel.delvirginia@verizon.net In re QuickSuites Two, LLC Bankr. S.D.N.Y. Case No. 13-10411 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/nysb13-10411.pdf represented by: Gabriel Del Virginia, Esq. Law Offices of Gabriel Del Virginia E-mail: gabriel.delvirginia@verizon.net In re Stephen Creech Bankr. E.D.N.C. Case No. 13-00817 Chapter 11 Petition filed February 8, 2013 In re A-Aardvark Bill Taylor's Transmissions, Inc. Bankr. W.D. Tenn. Case No. 13-21391 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/tnwb13-21391.pdf represented by: Ted I. Jones, Esq. Jones & Garrett Law Firm E-mail: dtedijones@aol.com In re Skyline Contractors, Inc. Bankr. E.D. Wash. Case No. 13-00487 Chapter 11 Petition filed February 8, 2013 See http://bankrupt.com/misc/waeb13-00487.pdf represented by: John D. Munding, Esq. Crumb & Munding E-mail: munding@crumb-munding.com In re Four Seasons Gas Services, Inc. Bankr. M.D. Fla. Case No. 13-01531 Chapter 11 Petition filed February 9, 2013 See http://bankrupt.com/misc/flmb13-01531.pdf represented by: Kevin E Mangum, Esq. Mangum & Associates PA E-mail: kevin@mangum-law.com In re Michael Skidmore Bankr. D. Mass. Case No. 13-10748 Chapter 11 Petition filed February 10, 2013 In re B & M Oil Company., Inc. dba Quail Express Bankr. D.N.M. Case No. 13-10361 Chapter 11 Petition filed February 10, 2013 See http://bankrupt.com/misc/nmb13-10361p.pdf See http://bankrupt.com/misc/nmb13-10361c.pdf represented by: R. Trey Arvizu, III, Esq. Arvizulaw.com, Ltd. E-mail: trey@arvizulaw.com In re Thomas Smith Bankr. E.D.N.C. Case No. 13-00862 Chapter 11 Petition filed February 10, 2013 In re Marvin Brody Bankr. D. Ariz. Case No. 13-01848 Chapter 11 Petition filed February 11, 2013 In re Jo Smith Bankr. W.D. Ark. Case No. 13-70433 Chapter 11 Petition filed February 11, 2013 In re Robert Okerlund Bankr. C.D. Calif. Case No. 13-01312 Chapter 11 Petition filed February 11, 2013 In re Leesburg For Rent, Inc. Bankr. M.D. Fla. Case No. 13-01587 Chapter 11 Petition filed February 11, 2013 See http://bankrupt.com/misc/flmb13-01587.pdf represented by: Robert B. Branson LAW OFFICE OF ROBERT B. BRANSON, P.A. E-mail: lawbankruptcy1@aol.com In re Jeffrey Siskind Bankr. S.D. Fla. Case No. 13-13096 Chapter 11 Petition filed February 11, 2013 In re LAW/WAL, LLC dba Racers Gentlemen's Club Racers Entertainment Complex Iron Skillet Bar 'N Grill Racers Bankr. E.D. Ky. Case No. 13-20231 Chapter 11 Petition filed February 11, 2013 See http://bankrupt.com/misc/kyeb13-20231.pdf represented by: Michael B. Baker, Esq. THE BAKER FIRM, PLLC E-mail: mbaker@bakerlawky.com In re Daniel Shoemaker Bankr. D. Md. Case No. 13-12272 Chapter 11 Petition filed February 11, 2013 In re Asar Incorporated LLC dba Meineke Econo Lube N' Tune Bankr. D. Nev. Case No. 13-50241 Chapter 11 Petition filed February 11, 2013 See http://bankrupt.com/misc/nvb13-50241.pdf represented by: Tory M. Pankopf, Esq. TORY M. PANKOPF LTD. E-mail: tppankopf@sbcglobal.net In re Homet Realty Company, Inc. Bankr. D. N.J. Case No. 13-12651 Chapter 11 Petition filed February 11, 2013 See http://bankrupt.com/misc/njb13-12651.pdf represented by: Carrie J. Boyle, Esq. LAW OFFICE OF SCOTT H. MARCUS & ASSOC. E-mail: cboyle@marcuslaw.net In re Garden State Gourmet, Inc. Bankr. D. N.J. Case No. 13-12662 Chapter 11 Petition filed February 11, 2013 See http://bankrupt.com/misc/njb13-12662.pdf represented by: Robert C. Nisenson, Esq. ROBERT C. NISENSON, LLC E-mail: rnisenson@aol.com In re Empire Bronze Art Casting, Inc. aka Art Foundry, Inc. Bankr. E.D.N.Y. Case No. 13-40746 Chapter 11 Petition filed February 11, 2013 See http://bankrupt.com/misc/nyeb13-40746.pdf represented by: Neil R. Flaum, Esq. FLAUM & ASSOCIATES, P.C. E-mail: flaumandassociatespc@gmail.com In re Ruby Robinson Bankr. W.D. Tex. Case No. 13-50331 Chapter 11 Petition filed February 11, 2013 In re Tad Gropp Bankr. E.D. Wash. Case No. 13-00505 Chapter 11 Petition filed February 11, 2013 In re Architectural Install Masters, Inc. Bankr. D. Ariz. Case No. 13-01875 Chapter 11 Petition filed February 12, 2013 See http://bankrupt.com/misc/azb13-01875.pdf represented by: Eric Slocum Sparks, Esq. Eric Slocum Sparks PC E-mail: law@ericslocumsparkspc.com In re Blue Sierra, Inc. Bankr. D. Ariz. Case No. 13-01876 Chapter 11 Petition filed February 12, 2013 See http://bankrupt.com/misc/azb13-01876.pdf represented by: Eric Slocum Sparks, Esq. Eric Slocum Sparks PC E-mail: law@ericslocumsparkspc.com In re Sierra Trust Holdings, LLC Bankr. D. Ariz. Case No. 13-01877 Chapter 11 Petition filed February 12, 2013 In re LPM Holdings, LLC Bankr. D. Ariz. Case No. 13-01879 Chapter 11 Petition filed February 12, 2013 See http://bankrupt.com/misc/azb13-01879.pdf represented by: Dennis J. Wortman, Esq. Dennis J. Wortman, P.C. E-mail: djwortman@azbar.org In re George Vandeman Bankr. C.D. Calif. Case No. 13-13679 Chapter 11 Petition filed February 12, 2013 In re CST Group, Inc. dba Greenfields Sports Bar, Inc. Bankr. D. Colo. Case No. 13-11894 Chapter 11 Petition filed February 12, 2013 See http://bankrupt.com/misc/cob13-11894p.pdf See http://bankrupt.com/misc/cob13-11894c.pdf represented by: Aaron J. Conrardy, Esq. Sender Wasserman Wadsworth, P.C. E-mail: aconrardy@sendwass.com In re Michael Schott Bankr. M.D. Fla. Case No. 13-01710 Chapter 11 Petition filed February 12, 2013 In re Smith Landscape Services, Inc. Bankr. M.D. Fla. Case No. 13-01725 Chapter 11 Petition filed February 12, 2013 See http://bankrupt.com/misc/flmb13-01725.pdf represented by: Sheila D. Norman, Esq. Norman and Bullington, P.A. E-mail: sheila@normanandbullington.com In re Meredith Patterson Bankr. S.D. Fla. Case No. 13-13116 Chapter 11 Petition filed February 12, 2013 In re Paul Francis Bankr. D. Mass. Case No. 13-10770 Chapter 11 Petition filed February 12, 2013 In re Heath Lewis Bankr. D. Nev. Case No. 13-11009 Chapter 11 Petition filed February 12, 2013 In re Steve Ayres Bankr. D. Nev. Case No. 13-11010 Chapter 11 Petition filed February 12, 2013 In re Cesar Castro Bankr. D.N.J. Case No. 13-12794 Chapter 11 Petition filed February 12, 2013 ********* 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 ***