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/raid1/www/Hosts/bankrupt/TCR_Public/130429.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, April 29, 2013, Vol. 17, No. 117 Headlines 250 AZ: Squar Milner Approved to Audit Schedule of Rental Revenue 250 AZ: Taps Keller Barrett to Prosecute Valuation Complaint AEROGROW INTERNATIONAL: Obtains $4 Million Investment From SMG AES CORP: Proposed $500MM Sr. Notes Offer Gets Moody's Ba3 Rating ALTISOURCE SOLUTIONS: Moody's Affirms B1 CFR After Loan Upsize AMARU INC: Former Accountant Withdraws Audit Report for 2011 AMBAC FINANCIAL: Keeping Mum on End of Board Nominee Crony Dispute AMERICAN AIRLINES: Parent Seeks $3.25B Financing to Pad Ch.11 Exit AMERICAN AIRLINES: Could Face $18MM in Boarding Pass Patent Claims AMERICAN INT'L GROUP: NY Seeks to Press Trial of Former Chief ANJASH LLC: Case Summary & 20 Largest Unsecured Creditors API TECHNOLOGIES: Sells Sensors Business for $51 Million ARCAPITA BANK: Gets OK to Solicit Creditors' Votes for Plan ARCAPITA BANK: Exclusivity Extended to Confirmation Hearing ASARCO LLC: Says It Didn't Waive Cemex Claim in $19MM Cleanup Row ATARI INC: US Trustee Takes Issue With Exec Bonuses BEACON ENTERPRISE: Charles Glasgow Held 10.6% Stake at April 12 BONAIR LINEN: Case Summary & 20 Largest Unsecured Creditors BOREAL WATER: Amends 2012 Annual Report BUNDY CANYON: Involuntary Chapter 11 Case Summary CAESARS ENTERTAINMENT: Loan Trades at 9% Off in Secondary Market CENTRAL EUROPEAN: ING Otwarty No Longer Owner as of April 19 CHRYSLER GROUP: Fiat, UAW Trust Offer Differing Prices COLLEGE BOOK: Cash Collateral Hearing Scheduled for April 30 COMMUNITY HOME: April 30 Hearing on Creditors Bid vs. Cash Use DEX MEDIA WEST: 2014 Loan Trades at 23% Off in Secondary Market DOUGLAS COUNTY BANK: Closed; Hamilton State Bank Assumes Deposits EASTMAN KODAK: Securities Fraud Suit Underdeveloped, Judge Says EDISON MISSION: Wants to Hire Novack & Macey as Litigation Counsel ELCOM HOTEL: Court to Decide on More Exclusivity Tomorrow ELITE PHARMACEUTICALS: Awarded Second Abuse Resistant Patent ENERGY FUTURE: 2014 Loan Trades at 25% Off in Secondary Market EXIDE TECHNOLOGIES: June 14 Lead Plaintiff Deadline Set EXTENDED STAY: Willkie Farr Skirts Suit Over $100MM Penalty FONTAINEBLEAU LAS VEGAS: Lenders, Contractors Near Ch. 7 Deal FUNCTIONAL TECHNOLOGIES: Reports 2nd Qtr. 2013 Financial Results GATEHOUSE MEDIA: 2014 Loan Trades at 64% Off in Secondary Market GENERAL MOTORS: Pay Change Signals CEO's Retirement GEOKINETICS INC: Second Modified Plan Filed, Confirmed GMX RESOURCES: Investors Blast $50MM Ch. 11 Loan As Unfair HAWTHORNE HALL: Case Summary & 8 Largest Unsecured Creditors HEALTHWAREHOUSE.COM INC: Incurs $1.6 Million Net Loss in Q3 HELLER EHRMAN: Greenberg to Pay $5MM to End Malpractice Row HORNE INTERNATIONAL: Appoints Dallas Evans as CEO ICEWEB INC: Post-Effective Amendment 2 to 43MM Shares Prospectus ICEWEB INC: Amends 43 Million Common Shares Prospectus IMAGEWARE SYSTEMS: Chris Kuchanny Held 5.8% Stake at March 28 INDIEPUB ENTERTAINMENT: David Smith Held 86.7% Stake at April 12 INDY CAR WASH: Case Summary & 20 Largest Unsecured Creditors INSPIREMD INC: Samuel Isaly Owned 6.9% Equity Stake at April 10 INSPIREMD INC: Hires Vice President of Corporate Development INTELLIPHARMACEUTICS INT'L: To Present at 12th Needham Conference J.C. PENNEY: Said to Have Pledge for $1.75BB Loan From Goldman J.M. HUBER: Improved Earnings Prompt Moody's to Lift CFR to Ba2 JONES GROUP: Moody's Reviews Ba2 CFR for Possible Downgrade K-V PHARMACEUTICAL: Lenders Slam Creditors' Disclosures Objections KINDRED HEALTHCARE: No Change on Moody's B1 CFR After Assets Sale KIT DIGITAL: Owners to Be Paid $2MM If Other Plan Deal Is Pursued KIT DIGITAL: Has $3-Mil. DIP Financing From JEC KIT DIGITAL: Proposes Procedures to Protect NOLs KIT DIGITAL: Proposes ALCS as Claims & Administrative Agent LEHMAN BROTHERS: Carter Ledyard Malpractice Suit Tossed LEHMAN BROTHERS: NY Giants Again Seek Docs in $300MM Stadium Row LIBERTY MEDICAL: Settles $40 Million Feud With Alere LIFECARE HOLDINGS: Reaches Deal Backing $320MM Carlyle Sale MAXCOM TELECOM: Considers Bankruptcy After Takeover Deal Collapse MISSION NEWENERGY: Serves KNM Process with Winding Up Petition MOBILICITY: May File for CBCA Plan of Arrangement or CCAA MONTANA ELECTRIC: Great Falls Agrees to Pay $3.25MM to Exit Coop MORRELL DEVELOPING: Voluntary Chapter 11 Case Summary MOTORS LIQUIDATION: GUC Trust and Budget Variance Reports NEXSTAR BROADCASTING: New Station Buy No Impact on Moody's B2 CFR NORTHLAND RESOURCES: Expects to File Annual Filings on April 30 ORCHARD BRANDS: Moody's Assigns B1 and Caa1 Ratings to New Debts ORAGENICS INC: Amends License Agreements with UFRF OVERSEAS SHIPHOLDING: $94MM Military Contract Approved PACIFIC GOLD: OKs Transfer of $175,000 Notes to Third Party PARKWAY BANK: Shut Down; Certus Bank Assumes Deposits PATRIOT COAL: Exclusive Filing Period Extended Until Sept. 2 PATRIOT COAL: Wins OK to Modify Non-Union Retiree Life Insurance PATRIOT COAL: Rule 2019 Motion Denied as Moot PENSON WORLDWIDE: Files Projected Cash Projections and Allocations PENSON WORLDWIDE: NDV Wants Stay Lifted to Pursue Arbitration PHIL'S CAKE: Hearing on Cash Access Continued Until May 23 PHIL'S CAKE: Taps Gregory Sharer as Certified Public Accountant PICACHO HILLS: William F. Davis Approved as Bankruptcy Counsel PM CROSS: Chapter 11 Case Summary & 2 Unsecured Creditors POSITIVEID CORP: Effects a 1-for-25 Reverse Stock Split R. BARKLEY: Voluntary Chapter 11 Case Summary RADIOSHACK CORP: Widens Net Loss to $43.3 Million in Q1 REVSTONE INDUSTRIES: Boston Finance Has Right to Credit Bid RITE AID: Swings to $118.1 Million Net Income in Fiscal 2013 RIVER ROAD: $19-Mil. Claim Cut to $52K in Settlement SALON MEDIA: Stockholders OK Hike of Authorized Stock to $150MM SAN BERNARDINO, CA: Projects $2.3MM Cash Surplus SAN DIEGO HOSPICE: April 30 Hearing on Motion to Appoint Trustee SAN DIEGO HOSPICE: Squar Milner Approved as Accountants SAN JOSE, CA: Council Finds It Cannot Afford to Quit CalPERS SCHOOL SPECIALTY: Committee Drops Motion to Terminate Exclusivity SHARON COBHAM: Case Summary & 12 Unsecured Creditors SI ORGANIZATION: Moody's Lowers CFR to 'B3', Negative Outlook SOUTH PROCYON: Case Summary & 4 Largest Unsecured Creditors SPIN HOLDCO: Moody's Rates Proposed Senior Credit Facility 'B2' SPRINT NEXTEL: Incurs $643 Million Net Loss in First Quarter STARCO VENTURES: Case Summary & 6 Unsecured Creditors STREAMTRACK INC: Incurs $1.8-Mil. Net Loss in Fiscal 2013 Q2 SYNAGRO TECHNOLOGIES: Wins Approval of $30-Mil. DIP Financing SYNAGRO TECHNOLOGIES: Case Summary & Creditors List SYNAGRO TECHNOLOGIES: Chap. 11 No Immediate Impact on Fitch Rating SYNAGRO TECHNOLOGIES: Moody's Downgrades PDR After Ch. 11 Filing TARGETED MEDICAL: Reports $2.8 Million Revenue in 1st Quarter TCB PROPERTY: Case Summary & 5 Unsecured Creditors THAPAN GROUP: Case Summary & 5 Unsecured Creditors TRINITY COAL: Gets Final Approval to Pay Critical Vendors TRINITY COAL: Members of Unsecured Creditors Committee TRINITY COAL: Wants to Hire D.J. Geiger as Mining Consultant UNI-PIXEL INC: Obtains $44 Million From Public Offering UNIGENE LABORATORIES: VPC Closes Auction of Peptelligence Assets UNIVERSAL HEALTH: Soneet Kapila Named Chapter 11 Trustee WASHINGTON AVENUE: Case Summary & 3 Unsecured Creditors WCI COMMUNITIES: Hires Banks for IPO Later This Year WEST CORP: Files Preliminary Form S-1 Prospectus with SEC WMG ACQUISITION: Moody's Rates Proposed Incremental Term Loan Ba3 YARWAY CORPORATION: Case Summary & Attorneys of Asbestos Claimants * NY Top Court Takes Up Post-Judgment Policy Exclusion Bid * Drop in Borrowing Squeezes Banks * SEC Aims to Protect Investors from Fraud under New Law * Hundreds in Chicago Using Bankruptcy Filings to Avoid Car Fines * Moody's Says Risks Remain in Canadian Life Insurance Sector * Small Hospitals Take Bulk of Rating Downgrades in 1st Quarter * High-Cost Loans Seeing Tremendous Growth * Carestream Bidding War Down to Just Two * S&P Dealt a Setback in Connecticut Case over Credit Ratings * Gordian Group Celebrating 25th Anniversary * BOND PRICING -- For Week From April 22 to 26, 2013 ********* 250 AZ: Squar Milner Approved to Audit Schedule of Rental Revenue ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona entered an order early this month authorizing 250 AZ, LLC to employ Squar, Milner, Peterson, Miranda & Williamson, LLP to audit the special purpose schedule of adjusted rental revenue of the Debtor's Ohio property known as the "Chiquita Center," located at 250 East Fifth Street, Cincinnati, Ohio. Squar Milner is also expected to report an objective opinion on whether the schedule is presented fairly, in all material respects, pursuant to the provisions of the ground lease dated April 29, 1992. Squar Milner will be charging the Debtor at the rates for applicable staff from $80 to $550 per hour. The estimated professional fees for the audit are $8,000 to $9,500. To the best of the Debtor's knowledge, Squar Milner has no connection with any of the parties-in-interest or their respective attorneys in the proceeding. About 250 AZ, LLC 250 AZ, LLC, filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 13-00851) in Tucson, Arizona, on Jan. 22, 2013. In its schedules, the Debtor disclosed $25 million in assets and $70.8 million in liabilities. 250 AZ owns an 84.70818% tenant in common interest in a 29-story office building located at 250 East Fifth Street, in Cincinnati, Ohio. Breen Olson & Trenton, LLP, serves as counsel to the Debtor. The U.S. Trustee advised the Court that an official committee of unsecured creditors has not been appointed because an insufficient number of persons holding unsecured claims against the company have expressed interest in serving on a committee. 250 AZ: Taps Keller Barrett to Prosecute Valuation Complaint ------------------------------------------------------------ 250 AZ, LLC, last month sought permission from the U.S. Bankruptcy Court for the District of Arizona to employ the law firm Keller, Barrett & Higgins, LLC to file and prosecute a complaint against Hamilton County Board of Revision for 2012, regarding the valuation of the property -- Chiquita Center, 250 E. Fifth St., Cincinnati, Ohio -- for the year ended Dec. 31, 2012. KBH Law will, among other things: a. give the Debtor legal advice with respect to its powers and duties as plaintiff in the litigation; b. negotiate with opposing counsel and parties regarding the issues central to the complaint; and c. prepare on behalf of your applicant, necessary pleadings, replies, motions, discovery, and other necessary documents to further the applicant's interest in the litigation. KBH Law will be charging the Debtor for services at the rates for applicable staff from $119 - $215 per hour. KBH Law is requesting an initial retainer of $1,500 to commence with the action. To the best of the Debtor's knowledge, KBH Law represents no interest adverse to the Debtor, or to the estate, in the matters upon which it is to be engaged. About 250 AZ, LLC 250 AZ, LLC, filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 13-00851) in Tucson, Arizona, on Jan. 22, 2013. In its schedules, the Debtor disclosed $25 million in assets and $70.8 million in liabilities. 250 AZ owns an 84.70818% tenant in common interest in a 29-story office building located at 250 East Fifth Street, in Cincinnati, Ohio. Breen Olson & Trenton, LLP, serves as counsel to the Debtor. The U.S. Trustee advised the Court that an official committee of unsecured creditors has not been appointed because an insufficient number of persons holding unsecured claims against the company have expressed interest in serving on a committee. AEROGROW INTERNATIONAL: Obtains $4 Million Investment From SMG -------------------------------------------------------------- AeroGrow International, Inc., announced a definitive agreement for a strategic alliance with a concurrent $4 million capital investment and $0.5 million asset purchase by SMG Growing Media, Inc., a subsidiary of The Scotts Miracle-Gro Company. The Scotts Miracle-Gro Company, through its wholly-owned subsidiaries, is the world's largest marketer of branded consumer products for lawn and garden care, with nearly $3 billion in annual worldwide sales. In addition to a significant working capital infusion from Scotts, the agreement affords AeroGrow the use of the globally recognized and highly trusted Miracle-Gro brand name. The strategic alliance also gives Scotts an entry into the burgeoning indoor gardening market, while providing AeroGrow a broad base of support in marketing, distribution, supply chain logistics, R&D, and sourcing. "The signing of this strategic alliance between AeroGrow and Scotts represents a transformational opportunity for our company, bringing us significant long-term growth potential," said Mike Wolfe, president and chief executive officer of AeroGrow. "The investment by Scotts, combined with the addition of the Miracle- Gro brand to the AeroGarden line and access to Scotts' retail distribution capabilities, delivers AeroGrow immediate access to millions of new consumers. In addition, we'll look to rapidly add new products and new technologies to our line of innovative indoor gardens, giving us the opportunity to add significant value for our shareholders." Under the agreement, a Scotts affiliate has acquired the intellectual property associated with AeroGrow's products. AeroGardens are all-in-one, indoor gardening appliances that make advanced growing technology simple for anyone. Consumers use it to grow year-round fresh herbs, vegetables, flowers, salad greens and more - with accessories that create innovative seed starting systems that complement Scotts' outdoor gardening business. "We intend to apply Scotts' proven expertise in consumer brand management in the garden category to help build the AeroGarden products," said Jim Gimeson, senior vice president and general manager of Gardens at The Scotts Miracle-Gro Company. "We see long-term opportunity in using AeroGrow's technology to grow the indoor gardening category, as well as in expanding the 'seed pod' technology outdoors. In addition, we see an opportunity for these products to perform well in international markets where indoor plants are very popular with consumers." AeroGrow to Host Investor Conference Call on Friday, April 26, 2013, to Discuss Strategic Alliance. The conference call is scheduled for 12:00 PM (noon) ET. To participate in the call, please dial U.S. (Toll Free): 1 (877) 317-6789 Canada (Toll Free): 1 (866) 605-3852 International: 1 (412) 317-6789 A replay of the call will be available within 6 hours of completion. Investors will be able to access it for the following 90 days through the AeroGrow Web site at www.aerogrow.com/investors or by phone until May 26, 2013. To access the replay by phone, please dial: U.S. and Canada: 1 (877) 870-5175 International: 1 (858) 384-5517 Conference Number: 10028181 As a condition to the Securities Purchase Agreement, the Investor is entitled to appoint one member to the Board while the Warrant remains outstanding. Pursuant to provision, the Investor has appointed Chris J. Hagedorn to the Company's Board effective as of April 22, 2013. Mr. Hagedorn is an employee of The Scotts Company LLC, a wholly owned subsidiary of The Scotts Miracle-Gro Company. There are no other transactions between Mr. Hagedorn and the Company that would be required to be reported under Item 404(a) of Regulation S-K. Mr. Hagedorn will serve on two Board committees: the Audit Committee and the Governance, Compensation and Nominating Committee and will receive no compensation for his service as a director, but he will be reimbursed for expenses attributable to his Board and Committee membership. Effective as of April 22, 2013, and as required by the Securities Purchase Agreement, the Board of Directors amended the Bylaws to require that the Board consist of five directors, mandate that the holder of the Series B Preferred Stock be entitled to appoint one member of the Board, require that the Series B Director serve on all committees of the Board, and require that the Company's Bylaws not be amended without the approval of the Series B Director. A copy of the Form 8-K as filed with the SEC is available at: http://is.gd/V0zid1 About AeroGrow Boulder, Colo.-based AeroGrow International, Inc., is a developer, marketer, direct-seller, and wholesaler of advanced indoor garden systems designed for consumer use and priced to appeal to the gardening, cooking, and healthy eating, and home and office decor markets. The Company reported a net loss of $3.55 million for the year ended March 31, 2012, a net loss of $7.92 million for the year ended March 31, 2011, and a net loss of $6.33 million for the year ended March 31, 2010. The Company's balance sheet at Dec. 31, 2012, showed $4.13 million in total assets, $4.31 million in total liabilities and a $185,890 total stockholders' deficit. AES CORP: Proposed $500MM Sr. Notes Offer Gets Moody's Ba3 Rating ----------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to the AES Corporation's planned $500 million senior unsecured note offering, proceeds from which will be used to refinance upcoming debt maturities. Concurrent with this rating assignment, Moody's affirmed the Ba1 rating on AES' existing senior secured revolver and assigned a Ba1 to the amended senior secured term loan, affirmed the Corporate Family Rating (CFR), and senior unsecured debt rating at Ba3, Probability of Default Rating (PDR) at Ba3-PD, and affirmed the B2 subordinated debt rating. The SGL-2 speculative grade liquidity rating is unchanged. The rating outlook for AES is stable. Ratings Rationale: AES' Ba3 CFR reflects the company's leverage profile and the structural subordination of its recourse debt to the significant amount of non-recourse debt in its consolidated capital structure at the operating subsidiary level. Structural constraints are somewhat mitigated by the diversification provided by AES' large number of subsidiaries, their wide geographic distribution and balanced fuel mix, and the significant proportion of the subsidiaries' cash flows that are subject to stable regulation or long-term contracts. The rating also takes into consideration headwinds the company faces in restructuring its Ohio-based utility business offset in part by a reduction in AES' recourse debt. The acquisition of DPL, Inc. (DPL: Ba1 senior unsecured, under review for possible downgrade) completed in-late 2011, the parent company of The Dayton Power and Light Company (DP&L: Baa2 Issuer Rating, under review for possible downgrade), was expected to improve AES' consolidated financial performance and reduce its overall business risk profile. While certain aspects of overall business risk has occurred, the financial contribution anticipated from the acquisition has not materialized as the business has encountered significant headwinds. Greater-than-anticipated customer shopping within DP&L's service territory has pressured consolidated operating margins and cash flows. DP&L has filed with its regulators an electric security plan or ESP that, if approved as filed, would provide some financial cushion while the utility transitions to market-based pricing; however, incremental margin compression is expected. AES has announced steps to strengthen DPL's balance sheet through a multi-year deleveraging and refinancing program. Over the next couple of years, essentially all cash generated within the DPL family will be used for debt reduction. Previously, Moody's had anticipated DPL would provide AES a dividend stream in the range of $150-200 million annually. That said, AES' diversified business model and on-going debt reduction efforts support the assigned ratings at their current levels. AES has successfully reduced recourse debt with proceeds from assets sales and internal cash flow. In 2012, AES repaid $530 million of senior secured borrowings and will reduce unsecured debt on a net basis by $300 million during the second quarter of 2013. As such, AES' recourse debt levels will have been reduced to approximately $5.7 billion or 12% less than the approximate $6.5 billion outstanding at year-end 2011. AES' strategy has shifted away from portfolio development and more toward portfolio rationalization and cost control. Moody's views this strategy positively from a credit perspective due to the expected realization of incremental cash flow and the shedding of less strategic assets. AES is committed to exiting markets where the company does not have either a competitive advantage or strong platform for expansion. This philosophy has resulted in AES selling its ownership in gas-fired assets in Spain, generating assets in China, wind assets in France, telecom assets in Brazil and electric utility distribution assets in the Ukraine. Net proceeds from asset sales that have closed or are expected to close over the next several weeks is approximately $1 billion. Moody's anticipates additional asset sales over the next 12-18 months with proceeds used in part to potentially further deleverage AES' parent balance sheet. Moody's had anticipated distributions from DPL to increase the scale of steady and predictable cash flows to AES and drive a slight improvement in key financial metrics. Specifically, Moody's had anticipated AES would achieve adjusted parent operating cash flows (POCF, which is subsidiary distributions to AES net of parent level interest expense, overhead expenses and income taxes) to parent level debt in excess of 10% and the ratio of POCF plus parent level interest to parent level interest of at least 2.4 times in each of 2013 and 2014. Given the announced cash flow reduction from DPL, offset in part by parent debt reduction targets previously not envisioned, these metrics are expected to range between 8-10% and approximately 2 times during this timeframe weakening the company's position within in the Ba3 rating category. AES still has significant financial flexibility due to the breadth and diversity of its operating subsidiaries as it works toward improving the financial performance of DPL. Specifically, at AES parent, Moody's anticipates the company will generate substantial free cash flow (after the payment of all parent obligations and its common dividend) in each of 2013 and 2014. AES' liquidity remains good and its speculative grade liquidity rating of SGL-2 reflects good liquidity prospects for the next twelve months based upon internal holding company cash flow generation, access to external facilities and ample covenant headroom under the company's credit facilities. AES has almost full availability under its $800 million revolving credit facility due January 2015. AES stable rating outlook reflects Moody's expectations the company will continue to implement its asset rationalization program over the next few years which will serve to buttress the near-term reduction in contributions from DPL. The stable rating further factors Moody's belief that a reasonable transition to market rates will ultimately surface as the regulatory plan in Ohio. In light of the expected declined in POCF to the 8-10% range and the challenges AES faces in Ohio, limited near-term prospects exist for AES' ratings to increase. AES' ratings could face downward pressure if the parent level financial metrics of POCF to debt falls below 8% for an extended period. Issuer: AES Corp Ratings Affirmed: Corporate Family Rating, Ba3 Senior Unsecured Rating, Ba3 Probability of Default Rating, Ba3-PD Senior Secured Rating, Ba1 Trust Preferred Securities, B2 Ratings Assigned: $500 million Senior Unsecured Notes, assigned Ba3, LGD4, 57% $805 million amended Senior Secured Term Loan, assigned Ba1, LGD2, 16% Senior unsecured shelf registration, assigned (P)Ba3 Trust preferred shelf registration, assigned (P)B2 LGD Point Estimate Changes Senior Secured Credit Facilities, to LGD2, 16% from LGD2, 17% Senior Unsecured Regular Bond/Debenture, to LGD4, 57% from LGD4, 55% The methodologies used in this rating were Unregulated Utilities and Power Companies published in August 2009, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. ALTISOURCE SOLUTIONS: Moody's Affirms B1 CFR After Loan Upsize -------------------------------------------------------------- Moody's Investors Service affirmed Altisource Solutions S.a r.l.'s B1 Corporate Family Rating and its B1 rating on its senior secured term loan following the company's announcement of its plan to increase the loan to $400 million from $200 million. The outlook for the ratings is stable. Ratings Rationale: The B1 ratings are largely driven by the company's high reliance on Ocwen (B1/STA). Altisource was spun off from Ocwen in 2009 and currently derives approximately 60% of the overall revenue from Ocwen. In addition, Altisource, with $568 million of revenues (full year 2012), is relatively small compared to its mortgage business service company peers, LPS and CoreLogic with approximately $2.0 billion and $1.5 billion in annual revenue, respectively. Excluding Ocwen, the company generates approximately $220 million in annual revenues, making the company far smaller than its mortgage business service company peers. The company benefits from its low leverage, strong cashflow, and solid earnings, which compares favorably to other B1 peers. In addition, the company has several promising new business opportunities, in particular in origination services through its Lenders One and Ocwen relationships as well as in residential property management for Altisource Residential Corporation. In addition to benefiting from Ocwen's growth, the company's growth strategy is focused on increasing revenue from property management and origination related services. The $200 million of loan proceeds are expected to be used to: (i) fund the remaining $48.8 million balance of the Residential Capital, LLC's fee- based business acquired from Ocwen (ii) fund other acquisitions, and (iii) general corporate purposes including share buy-backs. The stable rating outlook reflects Moody's expectation that Altisource's revenues will increase significantly over the next year largely as a result of Ocwen's growth. However, this will result in Altisource being further reliant on Ocwen for revenue. Upgrades in Ocwen's ratings could create upward rating pressure for Altisource. In addition, a significant reduction in Altisource's reliance on Ocwen while maintaining its current level of financial performance, including operating margins in excess of 25%, free cashflow to debt in excess of 15% and debt to EBITDA below 2.5x would be viewed positively. Downgrades in Ocwen's ratings or the loss of Ocwen's contract could create downward rating pressure. In addition, the ratings could be downgraded if the company's financial performance materially deteriorates for an extended period of time, including a decline in service revenue below $350 million, operating margins below 15%, or free cashflow to debt below 5%. In addition, debt to EBITDA above 3.5x would be viewed negatively. Altisource is a business services company providing services to the real estate, mortgage, asset recovery and financial services market. The principal methodology used in this rating was Finance Company Global Rating Methodology published in March 2012. AMARU INC: Former Accountant Withdraws Audit Report for 2011 ------------------------------------------------------------ WilsonMorgan, LLP., Amaru, Inc.'s previous independent registered public accounting firm who issued the audit report for the Company's fiscal year ended Dec. 31, 2011, notified the Board of Directors of the Company that they were withdrawing their audit report for the fiscal year ended Dec. 31, 2011, and that said audit report should no longer be relied upon. The reasons for the withdrawal of said audit report were provided by WM in its letter dated as of April 18, 2013, to the Company. WM stated that when they were contacted in March 2013 by Wei Wei & Co., LLP, the Company's current independent registered public accounting firm, in connection with the audit of the financial statements for the fiscal year ended Dec. 31, 2012, to review certain workpapers from the audit of the 2011 Financial Statements and to obtain their consent for the inclusion of the 2011 Financial Statements in the Company's annual report on Form 10-K, WM discovered that significant workpapers for the audit of the 2011 Financial Statements were missing from their audit file. WM also informed the Company that they discovered that there was not a second partner, or "concurring" review, of the audit prior to the issuance of the audit report. The new audit of the fiscal year ended Dec. 31, 2011, will be performed by Wei Wei & Co., LLP. WM agreed to cover the full cost of that audit, including, any other related filing, legal and other fees and expenses. The Company will file an amended Form 10-K for the fiscal year 2011 and any amended quarterly reports as may be required. About Amaru Inc. Singapore-based Amaru, Inc., a Nevada corporation, is in the business of broadband entertainment-on-demand, streaming via computers, television sets, PDAs (Personal Digital Assistant) and the provision of broadband services. The Company's business includes channel and program sponsorship (advertising and branding); online subscriptions, channel/portal development (digital programming services); content aggregation and syndication, broadband consulting services, broadband hosting and streaming services and E-commerce. After auditing the 2011 results, Wilson Morgan, LLP, in Irvine, California, noted that the Company has sustained accumulated losses from operations totalling $40.7 million at Dec. 31, 2011. This condition and the Company's lack of significant revenue, raise substantial doubt about the Company's ability to continue as going concern, the auditors said. Amaru reported a net loss from operations of $1.37 million in 2011, compared with a net loss from operations of $1.50 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $3.28 million in total assets, $3.08 million in total liabilities and $195,261 in total stockholders' equity. AMBAC FINANCIAL: Keeping Mum on End of Board Nominee Crony Dispute ------------------------------------------------------------------ Maria Chutchian of BankruptcyLaw360 reported that an Ambac Financial Group Inc. board nominee who was accused of trying to score a top position at the company for an unqualified friend will not serve on the board, but the details of the resolution are being kept under wraps. According to the report, the bond insurer urged a bankruptcy judge to remove investment strategist Charles Lemonides' name from consideration as a board of directors nominee in March, saying he pushed for an unqualified friend to become the company's chief investment officer. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac's bond insurance unit, Ambac Assurance Corp., is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about US$1.62 billion. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. Bankruptcy Judge Shelley C. Chapman entered an order confirming the Fifth Amended Plan of Reorganization of Ambac Financial Group, Inc. on March 14, 2012. The Plan provides for the full payment of secured claims and 8.5% to 13.2% recovery for general unsecured claims. Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Ambac Financial Group and the restructuring proceedings of Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945- 7000). AMERICAN AIRLINES: Parent Seeks $3.25B Financing to Pad Ch.11 Exit ------------------------------------------------------------------ Maria Chutchian of BankruptcyLaw360 reported that AMR Corp. on Thursday asked a New York bankruptcy judge to sign off on $3.25 billion in exit financing that would be secured by American Airlines Inc.'s assets in its Latin American travel routes and provide extra liquidity for its eventual emergence from bankruptcy. According to the report, the airline, which expects to consummate its recently approved $11 billion merger with U.S. Airways Group Inc. by the end of August, said in a court filing that the additional financing will allow it to ensure successful operations once it exits Chapter 11. 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. 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. AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a definitive merger agreement under which the companies will combine to create a premier global carrier, which will have an implied combined equity value of approximately $11 billion. The deal is subject to clearance by U.S. and foreign regulators and by the bankruptcy judge overseeing AMR's bankruptcy case. 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: Could Face $18MM in Boarding Pass Patent Claims ------------------------------------------------------------------ Maria Chutchian of BankruptcyLaw360 reported that AMR Corp. may be forced to battle $17.7 million in patent infringement claims after a Texas-based company asked a New York bankruptcy judge Wednesday for permission to sue the airline over its alleged infringement of electronic boarding pass patents. According to the report, Aeritas LLC, which has launched similar litigation against several other airlines, claims American Airlines Inc. and other AMR subsidiaries have repeatedly infringed two patents both before it entered bankruptcy and throughout the Chapter 11 process through the use of its wireless e-commerce transactions. 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. 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. AMR and US Airways Group, Inc., on Feb. 14, 2013 announced a definitive merger agreement under which the companies will combine to create a premier global carrier, which will have an implied combined equity value of approximately $11 billion. The deal is subject to clearance by U.S. and foreign regulators and by the bankruptcy judge overseeing AMR's bankruptcy case. 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 INT'L GROUP: NY Seeks to Press Trial of Former Chief ------------------------------------------------------------- Michael J. De La Merced, writing for The New York Times' DealBook, reported that to pursue its civil fraud case against the American International Group's former chief executive, Maurice R. Greenberg, the New York attorney general's office is taking an unusual step. According to the DealBook report, the New York Attorney General is giving up the right to contest Mr. Greenberg's $115 million settlement of a separate class-action lawsuit -- and the right to win up to $6 billion worth of cash damages in its own legal action -- to help expedite a trial that would put the former A.I.G. executive on the stand. In a letter to a state court judge sent on Thursday, the office of the attorney general, Eric T. Schneiderman, wrote that it would continue to seek punishments against Mr. Greenberg, including a ban from the securities industry and a ban on serving as a director or officer of a publicly traded company, the DealBook report related. While applauding Mr. Schneiderman's decision to drop claims of cash damages, a lawyer for Mr. Greenberg criticized the effort to bring the case to trial, the report said. "Mr. Greenberg, in his role as 'control person' at A.I.G., has already voluntarily stipulated with the S.E.C. to broader injunctive relief than the New York attorney general could obtain in any event," the lawyer, David Boies, said in a statement, the DealBook cited. "This case is over. Someone should put it out of its misery." The move is meant to finally bring the eight-year-old case against Mr. Greenberg and a former A.I.G. chief financial officer, Howard Smith, to trial, according to the DealBook. The legal battle, rooted in accusations that the insurer committed accounting fraud that led to a $3.9 billion restatement in 2005, has been carried out by Mr. Schneiderman and two of his predecessors: Eliot L. Spitzer and Andrew Cuomo. ANJASH LLC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: AnjAsh, LLC dba Comfort Inn South 4624 Fairlane Drive Kingsport, TN 37663 Bankruptcy Case No.: 13-50744 Chapter 11 Petition Date: April 23, 2013 Court: U.S. Bankruptcy Court Eastern District of Tennessee (Greeneville) Judge: Marcia Phillips Parsons Debtor's Counsel: Dean Greer, Esq. DEAN GREER & ASSOCIATES 2809 East Center Street P.O. Box 3708 Kingsport, TN 37664 Tel: (423) 246-1988 E-mail: bankruptcy@deangreer.com Scheduled Assets: $1,990,938 Scheduled Liabilities: $2,786,333 A copy of the Company's list of its 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/tneb13-50744.pdf The petition was signed by Mayuri Patel, controlling member. API TECHNOLOGIES: Sells Sensors Business for $51 Million -------------------------------------------------------- API Technologies Corp. announced the sale of its Sensors Products business to Measurement Specialties, Inc., in a $51.4 million all- cash transaction. Net cash proceeds from the transaction will be used to pay down debt. Sensors, which includes thermal, position, and inertial sensor products, accounted for $26.2 million of API Technologies' revenue in fiscal year 2012. "This tax-efficient sale of our Sensors business allows API to significantly delever its balance sheet, dedicate resources to growing our core business, and solidify our position as a leading provider of high reliability solutions, with a focus on RF/microwave and microelectronics technologies," said Bel Lazar, president and chief executive officer of APITechnologies Corp. "Measurement Specialties is a leader in sensors and sensor-based electronic devices and serves as a great partner for this transition and Sensors' customers in the future." The Sensors sale is part of API's previously announced strategic review process. The strategic review process is ongoing and the Company does not intend to discuss or disclose further developments with respect to the Board's process unless and until the Board has approved a specific course of action. Jefferies LLC acted as financial advisor to API Technologies in connection with the transaction. API Technologies also filed unaudited pro forma condensed consolidated financial statements as of Feb. 28, 2013, a copy of which is available for free at http://is.gd/sNABU7 About API Technologies Corp. API Technologies designs, develops and manufactures electronic systems, subsystems, RF and secure solutions for technically demanding defense, aerospace and commercial applications. API Technologies' customers include many leading Fortune 500 companies. API Technologies trades on the NASDAQ under the symbol ATNY. For further information, please visit the Company Web site at www.apitech.com. For the 12 months ended Nov. 30, 2012, the Company reported a net loss of $148.70 million, as compared with a net loss of $17.32 million during the prior year. The Company's balance sheet at Feb. 28, 2013, showed $ 381.70 million in total assets, $232.94 million in total liabilities, $25.23 million in preferred stock, and $123.52 million in shareholders' equity. * * * As reported by the TCR on Feb. 14, 2013, 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. On Feb. 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. In the Feb. 22, 2013, edition of the TCR, Standard & Poor's Ratings Services said that it lowered its corporate credit rating on API Technologies Corp. to 'B-' from 'B'. "The downgrade reflects weaker-than-expected credit metrics resulting from less-than-expected improvements in operating performance and higher debt, including a modest increase from the recent refinancing," said Standard & Poor's credit analyst Chris Mooney. ARCAPITA BANK: Gets OK to Solicit Creditors' Votes for Plan ----------------------------------------------------------- A bankruptcy judge in New York on Friday entered an order approving the disclosure statmenet explaining the Chapter 11 plan of reorganization plan of Arcapita Bank B.S.C., et al. As a result, the Debtors can now begin soliciting votes on the Plan. As ordered by the Court, the Debtors will mail or cause to be mailed (and in addition may e-mail) the solicitation package not later than May 2, 2013. GCG, Inc. will tabulate the Ballots and certify to the Court the results of the balloting by June 3, 2013 at 4:00 p.m. To be counted, all Ballots must be properly executed, completed and delivered to GCG so that the ballots are actually received on or before May 30, at 12:00 p.m., unless extended by the Debtors. A hearing will be held before the Bankruptcy Court on June 11, 2013, at 11:00 a.m., to consider confirmation of the Plan. Arcapita Bank B.S.C.(c), et al., filed on April 25, 2013, a Second Amended Disclosure Statement. There were no changes made as to the treatment of the various claims against and interests in the Debtors. A copy of the Second Amended Disclosure Statement is available at: http://bankrupt.com/misc/arcapta.doc1038.pdf A blacklined copy of the Second Amended Disclosure Statement, which is marked to show changes from the First Amended Disclosure Statement, which was filed on April 16, 2013, is available at: http://bankrupt.com/misc/arcapita.doc1039.pdf The Debtors also filed an amended Exhibit L ("Syndication Companies and Reorganized Arcapita Settlement Term Sheet") to the Second Amended Disclosure Statement, which replaces the Exhibit L that was attached to the Second Amended Disclosure Statement in its entirety. A copy of the Amended Exhibit L is available at: http://bankrupt.com/misc/arcapita.doc1041.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., 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 had 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. On Feb. 8, 2013, the Debtors filed with the Bankruptcy Court 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. ARCAPITA BANK: Exclusivity Extended to Confirmation Hearing ----------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York approved Friday the motion of Arcapita Bank B.S.C.(c), et al.'s motion for an order further extending the Debtors' Exclusive Solicitation Period through the conclusion of the hearing to consider confirmation of the Plan as the same may be adjourned from time to time. However, if (a) at or prior to the Confirmation Hearing, the Court determines that re-solicitation of the Plan is required, and (b) either (i) the modification to the Plan which requires re- solicitation was proposed by the Committee and such modification was made prior to the Confirmation Hearing, or (ii) the Committee consents to the further extension of the Exclusive Solicitation Period (as set forth in the following clause), then the Exclusive Solicitation Period will be further extended through the conclusion of the confirmation hearing with respect to the Plan that is subject of the re-solicitation. 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., 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 had 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. On Feb. 8, 2013, the Debtors filed with the Bankruptcy Court 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. ASARCO LLC: Says It Didn't Waive Cemex Claim in $19MM Cleanup Row ----------------------------------------------------------------- Jeremy Heallen of BankruptcyLaw360 reported that Asarco LLC told a Texas federal court Monday that it preserved in bankruptcy court its right to pursue litigation against Cemex Inc. for its share of $19 million in environmental cleanup costs associated with a Superfund site that both companies allegedly polluted. According to the report, in its response to Cemex's motion for summary judgment, Asarco urged U.S. District Judge Philip R. Martinez not to dismiss the case, arguing on a Fifth Circuit requirement that a debtor's bankruptcy plan contain a "specific and unequivocal" reservation of a cause of action. About Asarco LLC Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. ASARCO LLC filed for Chapter 11 protection (Bankr. S.D. Tex. Case No. 05-21207) on Aug. 9, 2005. Attorneys at Baker Botts L.L.P., and Jordan, Hyden, Womble & Culbreth, P.C., represented the Debtor in its restructuring efforts. On Dec. 9, 2009, Asarco Incorporated and Americas Mining Corporation's Seventh Amended Plan of Reorganization for the Debtors became effective and the ASARCO Asbestos Personal Injury Settlement Trust was created and funded with nearly $1 billion in assets, including more than $650 million in cash plus a $280 million secured note from Reorganized ASARCO. The Plan, which was confirmed both by the bankruptcy and district courts, reintegrated ASARCO LLC back to parent Grupo Mexico concluding the four-year Chapter 11 proceeding. ATARI INC: US Trustee Takes Issue With Exec Bonuses --------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that the U.S. Trustee's Office objected Thursday to bankrupt video game pioneer Atari Inc.'s plan to pay bonuses to three executives and six other employees, arguing the terms aren't sufficiently spelled out in the public record and expressing concern that the payouts are really intended as retention deals. According to the report, Atari Inc., the U.S. branch of French firm Atari SA that is also going through bankruptcy proceedings in Europe, filed a motion in the U.S. Bankruptcy Court for the Southern District of New York in March asking to approve bonus payments for its executives. About Atari Atari -- http://www.atari.com-- is a multi-platform, global interactive entertainment and licensing company. Atari owns and/or manages a portfolio of more than 200 games and franchises, including world renowned brands like Asteroids(R), Centipede(R), Missile Command(R), Pong(R), Test Drive(R), Backyard Sports(R), and Rollercoaster Tycoon(R). Atari Inc. and its U.S. affiliates filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Lead Case No. 13-10176) on Jan. 21, 2013, to break away from their unprofitable French parent company and secure independent capital. A day after its American unit filed for Chapter 11 bankruptcy protection, Paris-based Atari S.A. took a similar measure under Book 6 of that country's commercial code. Atari S.A. said it was filing for legal protection because its longtime backer BlueBay has sought to sell its 29% stake and demanded repayment by March 31 on a credit line of $28 million that it cut off in December. Peter S. Partee, Sr. and Michael P. Richman of Hunton & Williams LLP are proposed to serve as lead counsel for the U.S. companies in their Chapter 11 cases. BMC Group is the claims and notice agent. Protiviti Inc. is the financial advisor. The Official Committee of Unsecured Creditors is seeking Court permission to retain Duff & Phelps Securities LLC as its financial advisor. The Committee sought and obtained authority to retain Cooley LLP as its counsel. BEACON ENTERPRISE: Charles Glasgow Held 10.6% Stake at April 12 --------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Charles W. Glasgow and Jean L. Glasgow disclosed that, as of April 12, 2013, they beneficially owned 4,000,000 shares of common stock of Beacon Enterprise Solutions Group Inc. representing 10.63% of the shares outstanding. A copy of the regulatory filing is available at http://is.gd/Nid5CI About Beacon Enterprise Beacon Enterprise Solutions Group, Inc., headquartered in Louisville, Ky., provides international telecommunications and information technology systems (ITS) infrastructure services, encompassing a comprehensive suite of consulting, design, installation, and infrastructure management offerings. Beacon's portfolio of infrastructure services spans all professional and construction requirements for design, build and management of telecommunications, network and technology systems infrastructure. Professional services offered include consulting, engineering, program management, project management, construction services and infrastructure management services. Beacon offers these services under either a comprehensive contract option or unbundled to the Company's global and regional clients. The Company's balance sheet at June 30, 2012, showed $7.3 million in total assets, $8.8 million in total liabilities, and a stockholders' deficit of $1.5 million. For the nine months ended June 30, 2012, the Company generated a net loss of $5.9 million, which included a non-cash impairment of intangible assets of $2.1 million and other non-cash expenses aggregating $1.9 million. Cash used in operations amounted to $1.0 million for the nine months ended June 30, 2012. As of June 30, 2012, the Company's accumulated deficit amounted to $42.6 million, with cash and cash equivalents of $75,000 and a working capital deficit of $4.9 million. "These conditions raise substantial doubt about the Company's ability to continue as a going concern," the Company said in its quarterly report for the period ended June 30, 2012. BONAIR LINEN: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Bonair Linen LLC 5215 South Tacoma Way Tacoma, WA 98409 Bankruptcy Case No.: 13-42733 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Brian D. Lynch Debtor's Counsel: Steven R. Levy, Esq. 3700 Pacific Hwy E Ste 406 Fife, WA 98424 Tel: (253) 926-1494 E-mail: stevenlevy2@cs.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 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/wawb13-42733.pdf The petition was signed by Bonnie F. Fiorini, owner. BOREAL WATER: Amends 2012 Annual Report --------------------------------------- Boreal Water Collection, Inc., has amended its annual report on Form 10-K for the sole purpose of furnishing the Interactive Data File as Exhibit 101 in accordance with Rule 405 of Regulation S-T. A copy of the Amended Annual Report is available at: http://is.gd/qLZmq3 Kiamesha Lake, N.Y.-based Boreal Water Collection, Inc., is a personalized bottled water company specializing in premium custom bottled water. The Company reported a net loss of $822,902 on $2.7 million of sales in 2012, compared with a net loss of $1.3 million on $2.7 million of sales in 2011. The Company's balance sheet at Dec. 31, 2012, showed $3.7 million in total assets, $3.9 million in total liabilities, and a stockholders' deficit of $173,084. In the auditors's report accompanying the consolidated financial statements for the year ended Dec. 31, 2012, Patrick Rodgers, CPA, PA, in Altamonte Springs, Florida, expressed substantial doubt about Boreal Water's ability to continue as a going concern. Mr. Rodgers noted that the Company has a minimum cash balance available for payment of ongoing operating expenses, has experienced losses operations since inception, and it does not have a source of revenue sufficient to cover its operating costs. BUNDY CANYON: Involuntary Chapter 11 Case Summary ------------------------------------------------- Alleged Debtor: Bundy Canyon Land Development, LLC 28475 Old Town Front Street #D Temecula, CA 92590 Case Number: 13-13491 Involuntary Chapter 11 Petition Date: April 24, 2013 Court: District of Nevada (Las Vegas) Judge: Bruce T. Beesley Bundy Canyon's petitioners: Petitioner Nature of Claim Claim Amount ---------- --------------- ------------ Todd Hansen debt on promissory $100,000 2801 Fairview, Ste W note Greenwood, IN 46142 Margaret Cangelosi debt on promissory $60,000 5860 Lausanne Drive note Reno, NV 89511 Daniel Newman debt on promissory $90,000 125 Elysian Drive note Sedona, AZ 86336 CAESARS ENTERTAINMENT: Loan Trades at 9% Off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which Caesars Entertainment Inc. is a borrower traded in the secondary market at 91 cents-on-the-dollar during the week ended Friday, April 26, 2013, an decrease of 1.45 percentage points from the previous week according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. The Company pays 525 basis points above LIBOR to borrow under the facility. The bank loan matures on Jan. 1, 2018, and carries Moody's 'B3' rating and Standard & Poor's 'B' rating. The loan is one of the biggest gainers and losers for the week ended April 26 among 219 widely quoted syndicated loans with five or more bids in secondary trading. About Caesars Entertainment Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. -- http://www.caesars.com/-- is one of the world's largest casino companies, with annual revenue of $4.2 billion, 20 properties on three continents, more than 25,000 hotel rooms, two million square feet of casino space and 50,000 employees. Caesars casino resorts operate under the Caesars, Bally's, Flamingo, Grand Casinos, Hilton and Paris brand names. The Company has its corporate headquarters in Las Vegas. Harrah's announced its re-branding to Caesar's on mid-November 2010. The Company incurred a net loss of $1.49 billion on $8.58 billion of net revenues for the year ended Dec. 31, 2012, as compared with a net loss of $666.70 million on $8.57 billion of net revenues during the prior year. The Company incurred a $823.30 million net loss in 2010. The Company's balance sheet at Dec. 31, 2012, showed $27.99 billion in total assets, $28.32 billion in total liabilities and a $331.6 million total deficit. * * * Caesars Entertainment carries a 'CCC' long-term issuer default rating, with negative outlook, from Fitch and a 'Caa1' corporate family rating with negative outlook from Moody's Investors Service. As reported in the TCR on Feb. 5, 2013, Moody's Investors Service lowered the Speculative Grade Liquidity rating of Caesars Entertainment Corporation to SGL-3 from SGL-2, reflecting declining revolver availability and Moody's concerns that Caesars' earnings and cash flow will remain under pressure causing the company's negative cash flow to worsen. CENTRAL EUROPEAN: ING Otwarty No Longer Owner as of April 19 ------------------------------------------------------------ In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, ING Otwarty Fundusz EmeryTalny represented by ING Powszechne Towarzystwo Emerytalne S.A. disclosed that, as of April 19, 2013, it does not beneficially owned shares of common stock of Central European Distribution Corporation. ING Otwarty previously reported beneficial ownership of 5,309,203 common shares or a 6.51% equity stake as of Dec. 31, 2012. A copy of the amended regulatory filing is available at http://is.gd/F6yjkJ 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. On April 7, 2013, CEDC and two subsidiaries sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 13-10738) with a prepackaged Chapter 11 plan that reduces debt by US$665.2 million. Attorneys at Skadden, Arps, Slate, Meagher & Flom LLP serve as legal counsel to the Debtor. Houlihan Lokey is the investment banker. Alvarez & Marsal will provide the chief restructuring officer. GCG Inc. is the claims and notice agent. CHRYSLER GROUP: Fiat, UAW Trust Offer Differing Prices ------------------------------------------------------ Sharon Terlep, Christina Rogers and Eyk Henning, writing for The Wall Street Journal, reported that Italian auto maker Fiat SpA is working on a plan to buy full control of Chrysler Group LLC and then launch a U.S. share offering of the combined company to replenish its balance sheet, people familiar with the matter said. According to the WSJ report, Fiat is discussing financing with a group of investment banks including J.P. Morgan Chase & Co., Bank of America Merrill Lynch and Deutsche Bank AG to help purchase the 41.5% of Chrysler now owned by a UAW Retiree Medical Benefits Trust to pay for medical costs. WSJ said the trust's shares are worth between $1.75 billion and $4.27 billion, based on Fiat and trust calculations. The two are wrangling in court over a price for a portion of the trust's stake. A hearing on the matter is scheduled for Thursday before a state court in Delaware. Merging Chrysler and Fiat would be a big step toward completing Chief Executive Sergio Marchionne vision for Fiat when he took the helm at the company nearly a decade ago, and of the U.S. government's 2009 effort to save Chrysler by ushering it into bankruptcy and giving control of the company to Fiat, the WSJ report noted. A U.S. IPO would mark Chrysler's return to the public markets since it went private in 2007. Philippe Houchois, a London-based analyst at UBS, told WSJ listing the combined companies in the U.S. would make sense. "You create a business that on a pro forma basis looks more like Ford [Motor Co.], than Renault-Nissan [alliance]," Mr. Houchois said. "If you look at the structure now, you've got a good child with a problem parent, so it's potentially life-threatening," he added. "If you flip it around and Fiat becomes a division of Chrysler, it becomes easier to deal with." COLLEGE BOOK: Cash Collateral Hearing Scheduled for April 30 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Middle District of Tennessee will convene a hearing on April 30, 2013, at 10 a.m. consider College Book Rental Company, LLC's continued use of cash collateral. The Hon. Marian F. Harrison has already entered five interim agreed orders allowing the Debtor to use cash collateral. About College Book Four creditors filed an involuntary Chapter 11 bankruptcy petition against Murray, Kentucky-based College Book Rental Company, LLC (Bankr. M.D. Ky. Case No. 12-09130) in Nashville on Oct. 4, 2012. Bankruptcy Judge Marian F. Harrison oversees the case. The petitioning creditors are represented by Joseph A. Kelly, Esq., at Frost Brown Todd LLC. The petitioning creditors are David Griffin, allegedly owed $15 million for money loaned; Commonwealth Economics, allegedly owed $15,000 for unpaid services provided; John Wittman, allegedly owed $158 for unpaid services provided; and CTI Communications, allegedly owed $21,793 for unpaid services provided. The owners of College Book Rental consented to the Chapter 11 case and the appointment of a Chapter 11 trustee to run CBR. CBR is co-owned by Chuck Jones of Murray and David Griffin of Nashville, Tenn. An agreed order for relief under Chapter 11 was entered on Oct. 15, 2012. Robert H. Waldschmidt was appointed as trustee the next day. COMMUNITY HOME: April 30 Hearing on Creditors Bid vs. Cash Use -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Mississippi reset to April 30, 2013, at 1:30 p.m., the hearing to consider a motion by creditors Edwards Family Partnership, LP, and Beher Holdings Trust to prohibit Community Home Financial Services, Inc. from using cash collateral. The bankruptcy judge previously entered interim orders authorizing the Debtor to use cash collateral of EFP and BHT, subject to the Debtor making adequate protection payments. About Community Home Financial Community Home Financial Services, Inc., filed a Chapter 11 petition (Bankr. S.D. Miss. Case No. 12-01703) on May 23, 2012. Community Home Financial is a specialty finance company located in Jackson, Mississippi, providing contractors with financing for their customers. CHFS operates from one central location providing financing through its dealer network throughout 25 states, Alabama, Delaware, and Tennessee. The Debtor, in an amended schedule, disclosed $46,285,699 in assets and $30,271,339 in liabilities as of the Chapter 11 filing. Judge Edward Ellington presides over the case. Derek A. Henderson, Esq., at Derek A. Henderson Law Office, in Jackson, Mississippi; Jonathan Bissette Esq., at Wells Marble & Hurst, PLLC, in Jackson, Mississippi; and Roy H. Liddell, Esq., at Wells Marble & Hurst, PLLC, in Ridgeland, Mississippi, represent the Debtor as counsel. DEX MEDIA WEST: 2014 Loan Trades at 23% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which Dex Media West LLC is a borrower traded in the secondary market at 76.75 cents-on- the-dollar during the week ended Friday, April 26, 2013, an increase of 0.29 percentage points from the previous week according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. The Company pays 450 basis points above LIBOR to borrow under the facility. The bank loan matures on Oct. 24, 2014. The loan is one of the biggest gainers and losers for the week ended April 26, among 219 widely quoted syndicated loans with five or more bids in secondary trading. About Dex One Dex One Corp., headquartered in Cary, North Carolina, is a local business marketing services company that includes print directories and online voice and mobile search. The company employs 2,200 people across the United States. Dex One provides print yellow pages directors, which it co-brands with other recognizable brands in the industry, including Century Link and AT&T. It also provides the yellow pages websites DexKnows.com and DexPages.com, as well as mobile apps Dex Mobile, Dex CityCentral. Dex One and 11 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10534) on March 17 and 18, 2013, with a prepackaged plan of reorganization designed to effectuate a merger with SuperMedia Inc. Dex One disclosed total assets of $2.84 billion and total liabilities of $2.79 billion as of Dec. 31, 2012. Houlihan Lokey is acting as financial advisor to Dex One, and Kirkland & Ellis LLP is acting as its legal counsel. Pachulski Stang Ziehl & Jones LLP is co-counsel. Epiq Systems serves as claims agent. This is Dex One's second stint in Chapter 11. Its predecessor, R.H. Donnelley and 19 of its affiliates, including Dex Media East LLC, Dex Media West LLC and Dex Media Inc., sought Chapter 11 protection (Bank. D. Del. Case No. 09-11833 through 09-11852) on May 28, 2009. They emerged from bankruptcy on Jan. 29, 2010. On the Effective Date and in connection with its emergence from Chapter 11, RHD was renamed Dex One Corporation. As of Dec. 31, 2012, persons or entities directly or indirectly own, control, or hold 5% or more of the voting securities of Dex One are Franklin Advisers, Inc., Hayman Capital Management LP, Robert E. Mead, Restructuring Capital Associates LP, Paulson & Co., Inc., and Mittleman Investment Management LLC. DOUGLAS COUNTY BANK: Closed; Hamilton State Bank Assumes Deposits ----------------------------------------------------------------- Douglas County Bank of Douglasville, Georgia, was closed April 26, 2013, by the Georgia Department of Banking & Finance, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Hamilton State Bank, Hoschton, Georgia, to assume all of the deposits of Douglas County Bank. The four former branches of Douglas County Bank will reopen as branches of Hamilton State Bank during their normal business hours. Depositors of Douglas County Bank will automatically become depositors of Hamilton State Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Douglas County Bank should continue to use their current branch until they receive notice from Hamilton State Bank that systems conversions have been completed to allow full-service banking at all branches of Hamilton State Bank. As of December 31, 2012, Douglas County Bank had approximately $316.5 million in total assets and $314.3 million in total deposits. Hamilton State Bank will pay the FDIC a premium of 0.5 percent to assume all of the deposits of Douglas County Bank. In addition to assuming all of the deposits of the failed bank, Hamilton State Bank agreed to purchase approximately $260.9 million of the failed bank's assets. The FDIC will retain the remaining assets for later disposition. The FDIC and Hamilton State Bank entered into a loss-share transaction on $159.2 million of Douglas County Bank's assets. Hamilton State Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $86.4 million. Compared to other alternatives, Hamilton State Bank's acquisition was the least costly resolution for the FDIC's DIF. Douglas County Bank is the 10th FDIC-insured institution to fail in the nation this year, and the second in Georgia. The last FDIC-insured institution closed in the state was Frontier Bank, LaGrange, on March 8, 2013. EASTMAN KODAK: Securities Fraud Suit Underdeveloped, Judge Says --------------------------------------------------------------- Richard Vanderford of BankruptcyLaw360 reported that a federal judge on Thursday threw out a putative investor class action alleging Kodak's leadership hid plans to file for bankruptcy, saying the claims are too weak to go forward. According to the report, a few positive statements from Kodak CEO Antonio M. Perez, combined with its hiring of a Jones Day restructuring team, did not mean company brass recklessly misled investors about its financial state as it listed toward bankruptcy, U.S. District Judge Harold Baer Jr. said in a written opinion. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak completed the $527 million sale of digital-imaging technology on Feb. 1, 2013. Kodak intends to reorganize by focusing on the commercial printing business. EDISON MISSION: Wants to Hire Novack & Macey as Litigation Counsel ------------------------------------------------------------------ Edison Mission Energy asks the Bankruptcy Court for entry of an order authorizing the employment and retention of Novack & Macey LLP as special litigation counsel. On March 31, 2004, EME, BNY Power Partners LLC, n/k/a Tyche Power Partners LLC and JPMorgan Chase entered into an Escrow Agreement, pursuant to which JPMorgan agreed to receive, hold, and dispose of certain funds in accordance with the terms of the Escrow Agreement. EME believes that the Escrow Funds are property of its bankruptcy estate, but JPMorgan refuses to turn over the Escrow Funds to EME. Therefore, on April 12, 2013, EME commenced an adversary proceeding against JPMorgan and Tyche. The Debtors have determined that it is necessary to retain special counsel to represent EME in connection with the Adversary Proceeding due to a conflict of interest relating to JPMorgan that prevents both K&E and McDonald Hopkins from representing EME in the Adversary Proceeding. The Debtors have requested that Novack and Macey provide EME with the following discrete legal services: a. Represent EME in all respects in the Adversary Proceeding; b. Defend against any related action or counter-claim commenced by JPMorgan or Tyche against EME; c. Represent EME's interests in negotiations concermng the Adversary Proceeding and any related litigation; and d. Prepare motions, applications, answers, orders, appeals, reports and papers necessary to prosecute the Adversary Proceeding or represent EME in related litigation. Novack and Macey's hourly rates, subject to periodic firm-wide adjustment in the ordinary course of Novack and Macey's practice, are: Partners $425 to $700 Associates $260 to $360 Paraprofessionals $170 To the best of the Debtors' knowledge, Novack and Macey is a "disinterested person," as that phrase is defined in Bankruptcy Code Sec. 101(14), as modified by Bankruptcy Code Sec. 1107(b), and does not hold or represent an interest adverse to the estates. About Edison Mission Santa Ana, California-based Edison Mission Energy is a holding company whose subsidiaries and affiliates are engaged in the business of developing, acquiring, owning or leasing, operating and selling energy and capacity from independent power production facilities. EME also engages in hedging and energy trading activities in power markets through its subsidiary Edison Mission Marketing & Trading, Inc. EME was formed in 1986 and is an indirect subsidiary of Edison International. Edison International also owns Southern California Edison Company, one of the largest electric utilities in the United States. EME and its affiliates sought Chapter 11 protection (Bankr. N.D. Ill. Lead Case No. 12-49219) on Dec. 17, 2012. EME has reached an agreement with the holders of a majority of EME's $3.7 billion of outstanding public indebtedness and its parent company, Edison International EIX, that, pursuant to a plan of reorganization and pending court approval, would transition Edison International's equity interest to EME's creditors, retire existing public debt and enhance EME's access to liquidity. The Company's balance sheet at Sept. 30, 2012, showed $8.17 billion in total assets, $6.68 billion in total liabilities and $1.48 billion in total equity. In its schedules, Edison Mission Energy disclosed total assets of assets of $5,721,559,170 and total liabilities of $6,202,215,094 as of the Petition Date. Kirkland & Ellis LLP is serving as legal counsel to EME, Perella Weinberg Partners, LP is acting as financial advisor and McKinsey Recovery & Transformation Services U.S., LLC is acting as restructuring advisor. GCG, Inc., is the claims and notice agent. An official committee of unsecured creditors has been appointed in the case and is represented by the law firms Akin Gump and Perkins Coie. The Committee also has tapped Blackstone Advisory Partners as investment banker and FTI Consulting as financial advisor. ELCOM HOTEL: Court to Decide on More Exclusivity Tomorrow --------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida will convene a hearing on April 30, 2013, at 2:30 p.m. to consider approval of Elcom Hotel & Spa LLC and Elcom Condominium LLC's motion to extend their exclusive plan proposal periods. The Debtors are requesting the Court to extend their plan filing period until Sept. 2, 2013, and plan solicitation period until Nov. 4. The Debtors said they intend to propose a Plan that will include a sale of substantially all of their assets. But management is still in the process of formulating the plan, well as formulating the sales process and meeting with interested parties who seek to purchase the property. About Elcom Hotel Elcom Hotel & Spa LLC and Elcom Condominium LLC sought Chapter 11 protection (Bankr. S.D. Fla. Case Nos. 13-10029 and 13-10031) on Jan. 2, 2013, with plans to sell their hotel and condominium property. Elcom Condominium owns nine of the hotel condominium units at the One Bal Harbor Resort & Spa. The resort is located on five acres of land in Bal Harbor, Florida. The building and improvements consist of 185 luxury residential condominium units and 124 hotel condominium units. Elcom Hotel owns the hotel lot. Elcom Hotel estimated assets and liabilities of less than $50 million. The Debtor owes OBH Funding, LLC, $1.8 million on a mortgage and F9 Properties, LLC, formerly known as ANO, LLC, $9 million on a mezzanine loan secured by a lien on the ownership interests in the project's owner. OBH Funding and ANO are owned by Thomas D. Sullivan, the manager of the Debtors. Attorneys at Kozyak Tropin & Throckmorton, P.A., serve as bankruptcy counsel to the Debtor. Duane Morris LLP is the special litigation, real estate, and hospitality counsel. Algon Capital, LLC, d/b/a Algon Group's Troy Taylor is the Debtors' Chief Restructuring Officer. The United States Trustee has said it will not appoint an official committee of unsecured creditors for Elcom Hotel pursuant to 11 U.S.C. Section 1102 until further notice. ELITE PHARMACEUTICALS: Awarded Second Abuse Resistant Patent ------------------------------------------------------------ Elite Pharmaceuticals, Inc., announced the issuance of U.S. Patent No. 8,425,933 entitled "Abuse-Resistant Oral Dosage Forms and Method of Use Thereof" by the United States Patent and Trademark Office. This is the second issued U.S. patent covering Elite's abuse resistant technology for opioid products. Elite has additional patents pending in the U.S., Canada and Europe. "We are pleased to receive this second abuse resistant patent. The recent guidances and actions by the FDA related to extended release opioids and specifically oxycodone demonstrates the FDA support for abuse resistant technologies. Opioid products incorporating abuse resistant technologies have become a public health priority and these recent actions appear to be a major step towards the FDA eventually requiring that all extended release opioids utilize these technologies. This validates our approach and we believe substantially increases the value of our intellectual property and the abuse resistant products in our pipeline," said Jerry Treppel, Elite's Chairman and CEO. About Elite Pharmaceuticals Northvale, New Jersey-based Elite Pharmaceuticals, Inc., is a specialty pharmaceutical company principally engaged in the development and manufacture of oral, controlled-release products, using proprietary technology and the development and manufacture of generic pharmaceuticals. The Company has one product, Phentermine 37.5mg tablets, currently being sold commercially. Elite Pharmaceuticals reported a net loss attributable to common shareholders of $15.05 million for the year ended March 31, 2012, compared with a net loss attributable to common shareholders of $13.58 million during the prior year. Demetrius & Company, L.L.C., in Wayne, New Jersey, issued a "going concern" qualification on the consolidated financial statements for the year ended March 31, 2012, citing significant losses resulting in a working capital deficiency and shareholders' deficit, which raise substantial doubt about the Company's ability to continue as a going concern. The Company's balance sheet at Dec. 31, 2012, showed $10.37 million in total assets, $22.72 million in total liabilities and a $12.35 million total stockholders' deficit. ENERGY FUTURE: 2014 Loan Trades at 25% Off in Secondary Market -------------------------------------------------------------- Participations in a syndicated loan under which TXU Corp., now known as Energy Future Holdings Corp., is a borrower traded in the secondary market at 75.16 cents-on-the-dollar during the week ended Friday, April 26, 2013, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents an increase of 0.66 percentage points from the previous week, the Journal relates. The loan matures on October 10, 2014. The Company pays 350 basis points above LIBOR to borrow under the facility. The loan is one of the biggest gainers and losers for the week ended April 26, among 219 widely quoted syndicated loans with five or more bids in secondary trading. About Energy Future Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80%-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leverage buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. Energy Future incurred a net loss of $3.36 billion on $5.63 billion of operating revenues for 2012. This follows net losses of $1.91 billion in 2011 and $2.81 billion in 2010. The Company's balance sheet at Dec. 31, 2012, showed $40.97 billion in total assets, $51.89 billion in total liabilities and a $10.92 billion total deficit. The Company said in its Form 10-K for the year ended Dec. 31, 2012, "A breach of any of these covenants or restrictions could result in an event of default under one or more of our debt agreements at different entities within our capital structure, including as a result of cross acceleration or default provisions. Upon the occurrence of an event of default under one of these debt agreements, our lenders or noteholders could elect to declare all amounts outstanding under that debt agreement to be immediately due and payable and/or terminate all commitments to extend further credit. Such actions by those lenders or noteholders could cause cross defaults or accelerations under our other debt. If we were unable to repay those amounts, the lenders or noteholders could proceed against any collateral granted to them to secure such debt. In the case of a default under debt that is guaranteed, holders of such debt could also seek to enforce the guarantees. If lenders or noteholders accelerate the repayment of all borrowings, we would likely not have sufficient assets and funds to repay those borrowings. Such occurrence could result in EFH Corp. and/or its applicable subsidiary going into bankruptcy, liquidation or insolvency." EXIDE TECHNOLOGIES: June 14 Lead Plaintiff Deadline Set ------------------------------------------------------- Pomerantz Grossman Hufford Dahlstrom & Gross LLP on April 26 disclosed that it has filed a class action lawsuit against Exide Technologies and certain of its officers. The class action filed in United States District Court, Central District of California, is on behalf of a class consisting of all persons or entities who purchased or otherwise acquired securities of Exide Technologies between February 9, 2012 and April 3, 2013, both dates inclusive. This class action seeks to recover damages against the Company and certain of its officers and directors as a result of alleged violations of the federal securities laws pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. If you are a shareholder who purchased Exide Technologies securities during the Class Period, you have until June 14, 2013 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at http://www.pomerantzlaw.com To discuss this action, contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888-476-6529 (or 888-4-POMLAW), toll free, x237. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased. Exide operates in 80 countries, producing, recycling and distributing lead-acid batteries. The Company's global transportation and industrial energy groups purported to provide a range of stored electrical energy products and services for industrial and transportation applications. The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company's business, operations, and prospects. Specifically, defendants failed to disclose that: (a) Exide was polluting the environment with potentially fatal levels of arsenic, and exposing almost 110,000 residents near its Vernon, California battery recycling facility to dangerously high levels of pollutants; (b) Exide knew that based on actual and projected revenues and expenses it would not be able to meet its debt repayment obligations and other pledges and promises under its debt agreements and indentures. Specifically, the Company knew that it could not satisfy its obligations under a $200 million revolving facility, a $675 million bond, and a $55.7 million floating rate convertible note due in September 2013; and (c) as a result, Exide knew its environmental liabilities, debt obligations and potential insolvency supported neither Exide's statements to investors regarding the Company's financials, its quarterly guidance, nor the inflated share price targets the investment community was modeling based on Defendants' Class Period statements and guidance. On March 22, 2013, one of the Company's recycling facilities in Vernon, California, located approximately four miles due south of downtown Los Angeles, was cited by the South Coast Air Quality Management District as posing a greater cancer risk to residents of Southern California than any of the more than 450 facilities the Agency has regulated in the last 25 years. Following the Agency's citation, on April 3, 2013, Los Angeles City Council members held a public hearing asking the government to press charges against the Company to correct the health risk posed by the Company's environmental contamination. On April 4, 2013, news source Debtwire.com published a report that Exide had hired financial advisory firm Lazard and the law firm of Akin Gump LLP, both bankruptcy experts, to advise on its financial restructuring after prior restructuring efforts stalled. On this news, Exide's shares fell $1.24 a share to $1.37 a share (-46%), on April 4, 2013, before trading in the stock was halted. The Pomerantz Firm -- http://www.pomerantzlaw.com-- concentrates its practice in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. About Exide Technologies Headquartered in Princeton, New Jersey, Exide Technologies (NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and distributes lead acid batteries and other related electrical energy storage products. The Company filed for Chapter 11 protection (Bankr. Del. Case No. 02-11125) on April 14, 2002. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP represented the Debtors in their successful restructuring. The Court confirmed Exide's Amended Joint Chapter 11 Plan on April 20, 2004. The plan took effect on May 5, 2004. While it has emerged from bankruptcy, reorganized Exide continues to resolve claims filed against it in the Bankruptcy Court. EXTENDED STAY: Willkie Farr Skirts Suit Over $100MM Penalty ----------------------------------------------------------- Sindhu Sundar of BankruptcyLaw360 reported that Willkie Farr & Gallagher LLP on Thursday won its bid to toss a malpractice suit claiming that it exposed the former private equity owner of Extended Stay Inc. to a $100 million liability stemming from the hotel chain's bankruptcy. According to the report, Judge Melvin Schweitzer granted the law firm's motion to dismiss, ruling that David Lichtenstein had not shown that Willkie Farr was negligent -- a basic requirement for a malpractice claim to survive -- and disagreeing with Lichtenstein's argument. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors tapped Gilbert Backenroth, Esq., Mark T. Power, Esq., and Mark S. Indelicato, Esq., at Hahn & Hessen LLP, in New York, as counsel. Extended Stay had assets of $7.1 billion and debts of $7.6 billion as of the end of 2008. Extended Stay Inc. in October successfully emerged from Chapter 11 protection. An investment group including Centerbridge Partners, L.P., Paulson & Co. Inc. and Blackstone Real Estate Partners VI, L.P. has purchased 100 percent of the Company for $3.925 billion in connection with the Plan of Reorganization confirmed by the Bankruptcy Court in July 2010. FONTAINEBLEAU LAS VEGAS: Lenders, Contractors Near Ch. 7 Deal ------------------------------------------------------------- Carolina Bolado of BankruptcyLaw360 reported that attorneys for contractors and lenders warring over who will get paid first in the Chapter 7 proceedings of the failed $2.8 billion Fontainebleau Las Vegas resort on Thursday told a Florida bankruptcy judge that they are on the brink of a deal. According to the report, Daniel Gold of Ehrenstein Charbonneau Calderin, who represents the contractors, told U.S. Bankruptcy Judge A. Jay Cristol that the parties are currently negotiating the terms of a comprehensive settlement that will not just deal with several adversary proceedings in the bankruptcy. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- was planned as a hotel-casino on property along the Las Vegas Strip. Its developer, Fontainebleau Las Vegas Holdings LLC and affiliates, filed for Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 09-21481) on June 9, 2009. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represented the Debtors in their restructuring effort. Kurtzman Carson Consulting LLC served as the Debtors' claims agent. Attorneys at Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP, represented the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC estimated more than $1 billion in assets and debts, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings LLC estimated less than $50,000 in assets. In February 2010, Icahn Enterprises L.P. acquired Fontainebleau for roughly $150 million. The bankruptcy case was subsequently converted to Chapter 7. Soneet R. Kapila has been named the trustee for the Chapter 7 case of Fontainebleau Las Vegas. FUNCTIONAL TECHNOLOGIES: Reports 2nd Qtr. 2013 Financial Results ---------------------------------------------------------------- Functional Technologies Corp. on April 26 reported operational and financial results for the second quarter ended February 28, 2013. Amounts, unless specified otherwise, are expressed in Canadian dollars. Financial Results The Company achieved a net gain of $0.0177 million during the three month period ending February 28, 2013 ("Q2, 2013"), as compared to a net loss of $4.6 million in the same period in 2012 ("Q2, 2012"), representing an improvement of $4.630 million. This positive change is primarily a result of an asset impairment charge of $3.393 million in the prior period but also reflects a decrease in operating expense of $0.446 million in Q2, 2013 relative to Q2, 2012, as well as a $0.198 million gain from asset sales and $0.689 million gain from forgiveness of debt during Q2, 2013. Operating expenses, excluding stock-based compensation expenses, for Q2, 2013 were $0.78 million, compared to $1.1 million in Q2, 2012. Liquidity and Outstanding Share Capital As at February 28, 2013, the Company had cash and short-term investments of $0.5 million compared to $0.38 million as at August 31, 2012. As at February 28, 2013, Functional Technologies had 61,370,444 common shares issued and outstanding. Operating Highlights The second quarter of fiscal 2013 was primarily a quarter of reorganization to position the Company to move forward with its revised business plan, first announced April 4, 2012, which involved the sale and closure of non-yeast technology assets and subsidiaries. This restructuring, designed to place the Company in a position to minimize operating expenses while simultaneously accelerating commercialization of its proprietary yeast technologies, made significant advances during the quarter. During Q2, 2013, the Company announced: -- November 1, 2012 - The termination of the proposed sale of assets to former employees; -- December 7, 2012 - Senior Management Changes; -- February 4, 2013 - The hiring of in-House Investor Relations. During Q2, 2013 operational highlights included significant advances in the commercialization of the Company's Acrylamide Preventing ("AP") yeast. During this quarter commercial-grade AP yeast was independently manufactured by a global yeast manufacturer and third-party tested in commercial snack food products at a pilot scale level by a global food manufacturer. This pilot scale testing produced positive results that warrant further testing at a commercial scale. Subsequent to quarter-end: -- As at April 15, 2013 Finance PEI (formerly known as Innovation PEI), a secured creditor, enforced its security on the property of the Company's subsidiary, Phyterra Bio Inc. and placed Phyterra Bio Inc. into receivership. The total amount of indebtedness secured is $260,789. -- On April 25, 2013, the Company filed a notice of intent to submit a proposal to creditors under the Bankruptcy and Insolvency Act. Accounting Change The Company's Q2/13 consolidated financial statements have been prepared in accordance with International Financial Reporting Standards, reporting standards to which the Company transitioned from Canadian Generally Accepted Accounting Principles during the fiscal year ended August 31, 2012. About Functional Technologies Corp. Functional Technologies develops and commercializes proprietary, advanced yeast-based solutions to significant challenges in the food, beverage and healthcare industries. The Company's platform improves the performance of innate yeast functions, and prevents the formation of naturally occurring toxins and contaminants that either affect final product quality or are classified by the World Health Organization as probable human carcinogens. Functional Technologies' lead technologies include yeasts that prevent and reduce the formation of the foul-smelling hydrogen sulphide (H2S) and the carcinogen acrylamide, both of which are natural occurring by-products of food and beverage processing. These contaminants are found in many commonly consumed items, such as fermented food products and alcoholic beverages, and baked and fried foods. The head office and R&D operations for Functional Technologies are based in Vancouver, BC, Canada. GATEHOUSE MEDIA: 2014 Loan Trades at 64% Off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which GateHouse Media, Inc., is a borrower traded in the secondary market at 36.13 cents- on-the-dollar during the week ended Friday, April 26, 2013, a drop of 0.27 percentage points from the previous week according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. The Company pays 200 basis points above LIBOR to borrow under the facility. The bank loan matures on Feb. 27, 2014, and carries Moody's Ca rating and Standard & Poor's CCC- rating. The loan is one of the biggest gainers and losers for the week ended Friday among 219 widely quoted syndicated loans with five or more bids in secondary trading. About GateHouse Media GateHouse Media, Inc. -- http://www.gatehousemedia.com/-- headquartered in Fairport, New York, is one of the largest publishers of locally based print and online media in the United States as measured by its 97 daily publications. GateHouse Media currently serves local audiences of more than 10 million per week across 21 states through hundreds of community publications and local Web sites. Bankruptcy Warning "Our ability to make payments on our indebtedness as required depends on our ability to generate cash flow from operations in the future. This ability, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. "There can be no assurance that our business will generate cash flow from operations or that future borrowings will be available to us in amounts sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. Currently we do not have the ability to draw upon our revolving credit facility which limits our immediate and short-term access to funds. If we are unable to repay our indebtedness at maturity we may be forced to liquidate or reorganize our operations and business under the federal bankruptcy laws," the Company said in its annual report for the year ended Dec. 30, 2012. GENERAL MOTORS: Pay Change Signals CEO's Retirement --------------------------------------------------- Jeff Bennett, writing for The Wall Street Journal, reported that General Motors Co. signaled it is preparing for Chief Executive Daniel F. Akerson to retire in about two years by changing how the 64-year-old was paid last year. According to the WSJ report, Mr. Akerson received $11.1 million in total compensation in 2012 -- a 44% increase over the previous year, due largely to a change in stock units granted for 2012 that vested immediately and were part of his total compensation, according to a federal filing and the company. Earlier stock units vested in three years and beginning in 2012 included no time restrictions. The Detroit auto maker first replaced the restricted share-unit pay in 2012, the WSJ report said. The annual meeting proxy filed on Thursday said GM changed the type of share awards in "acknowledgment of the possibility of his retirement" during the vesting period, suggesting Mr. Akerson could retire as CEO by early 2015. "We can't comment any further than what is in the proxy or what Mr. Akerson's plans are for the future," a GM spokesman told WSJ on Thursday. Mr. Akerson, who has been CEO since 2010, has not said when he plans to retire, WSJ said. In an interview with The Wall Street Journal earlier this year, Mr. Akerson declined to comment on his retirement plans or on the company's succession plan. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company (NYSE:GM, TSX: GMM) -- http://www.gm.com/-- is one of the world's largest automakers, traces its roots back to 1908. GM employs 208,000 people in every major region of the world and does business in more than 120 countries. GM and its strategic partners produce cars and trucks in 30 countries, and sell and service these vehicles through the following brands: Baojun, Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Isuzu, Jiefang, Opel, Vauxhall, and Wuling. GM's largest national market is China, followed by the United States, Brazil, the United Kingdom, Germany, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. was formed to acquire the operations of General Motors Corp. through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The U.S. government once owned as much as 60.8% stake in New GM on account of the financing it provided to the bankrupt entity. The deal was closed July 10, 2009, and Old GM changed its name to Motors Liquidation Co. General Motors Corp. and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31, 2011. GEOKINETICS INC: Second Modified Plan Filed, Confirmed ------------------------------------------------------ BankruptcyData reported that Geokinetics Inc. filed with the U.S. Bankruptcy Court a Second Modified Joint Chapter 11 Plan of Reorganization and Second Amended Joint Plan Supplement, which contains a Rejected Executory Contract and Unexpired Lease List. According to the report, the Court subsequently approved the Disclosure Statement and concurrently confirmed the Second Modified Joint Chapter 11 Plan of Reorganization. About Geokinetics Inc. Headquartered in Houston, Texas, Geokinetics Inc., a Delaware corporation founded in 1980, provides seismic data acquisition, processing and integrated reservoir geosciences services, and land, transition zone and shallow water OBC environment geophysical services. Geokinetics Inc. and its nine affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10472) on March 10, 2013, with a prepackaged Chapter 11 plan that converts $300 million of senior secured notes into 100% of the reorganized Company's common stock. Akin Gump Strauss Hauer & Feld LLP serves as counsel to the Debtors; Richards, Layton & Finger, P.A., is co-counsel; Rothschild Inc. is the financial advisor and investment banker; UHY LLP is the independent auditor; and GCG, Inc., is the claims agent and administrative agent. Geokinetics Inc. incurred a net loss applicable to common stockholders of $93.06 million in 2012, a net loss applicable to common stockholders of $231.25 million in 2011 and a net loss applicable to common stockholders of $147.53 million in 2010. The Company's balance sheet at Dec. 31, 2012, showed $392.89 million in total assets, $593.53 million in total liabilities, $93.31 million in preferred stock, Series B-1 Senior Convertible, and a $293.94 million total stockholders' deficit. UHY LLP, in Houston, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. "[T]he Company and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Code. Uncertainties inherent in the bankruptcy process raise substantial doubt about the Company's ability to continue as a going concern." GMX RESOURCES: Investors Blast $50MM Ch. 11 Loan As Unfair ---------------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that a group of preferred shareholders of bankrupt oil and gas producer GMX Resources Inc. became the latest party Thursday to object to the company's request for $50 million in debtor-in-possession financing, arguing that the loan terms give an "unfair advantage" to secured creditors if the firm were to be sold. According to the report, investors Brian Burr, Michael Burr, Taylor Burr, Brad Keiller and DCB Capital LLC filed their motion in Oklahoma bankruptcy court, claiming that portions of the DIP financing terms could throw off the checks and balances in the bankruptcy case. About GMX Resources GMX Resources Inc. -- http://www.gmxresources.com/-- is an independent natural gas production company headquartered in Oklahoma City, Oklahoma. GMXR has 53 producing wells in Texas & Louisiana, 24 proved developed non-producing reservoirs, 48 proved undeveloped locations and several hundred other development locations. GMXR has 9,000 net acres on the Sabine Uplift of East Texas. GMXR has 7 producing wells in New Mexico. The Company's strategy is to significantly increase production, revenues and reinvest in increasing production. GMXR's goal is to grow and build shareholder value every day. The Company reported net losses of $206.44 million in 2011, $138.29 million in 2010, and $181.08 million in 2009. The Company's balances sheet at Sept. 30, 2012, showed $343.14 million in total assets, $467.64 million in total liabilities and a $124.49 million total deficit. GMX Resources filed a Chapter 11 petition in its hometown (Bankr. W.D. Okla. Case No. 13-11456) on April 1, 2013, so secured lenders can buy the business in exchange for $324.3 million in first-lien notes. GMX missed a payment due in March 2013 on $51.5 million in second- lien notes. Other principal liabilities include $48.3 million in unsecured convertible senior notes. The DIP financing provided by senior noteholders requires court approval of a sale within 75 days following approval of sale procedures. The lenders and principal senior noteholders include Chatham Asset Management LLC, GSO Capital Partners, Omega Advisors Inc. and Whitebox Advisors LLC. HAWTHORNE HALL: Case Summary & 8 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Hawthorne Hall Apartments, LLC 1209 Hill Road North, #200 Pickerington, OH 43147 Bankruptcy Case No.: 13-53234 Chapter 11 Petition Date: April 23, 2013 Court: U.S. Bankruptcy Court Southern District of Ohio (Columbus) Judge: John E. Hoffman, Jr. Debtors' Counsel: J. Matthew Fisher, Esq. ALLEN, KUEHNLE STOVALL & NEUMAN, LLP 17 South High Street, Suite 1220 Columbus, OH 43215 Tel: (614) 221-8500 Fax: (614) 221-5988 E-mail: fisher@aksnlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 Affiliates that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- Oakland Manor Apartments, LLC 13-53236 Assets: $500,001 to $1,000,000 Debts: $1,000,001 to $10,000,000 Rotunda Court Apartments, LLC 13-53239 Assets: $500,001 to $1,000,000 Debts: $1,000,001 to $10,000,000 Clarmound Vista Apartments, LLC 13-53241 Assets: $458,647 Debts: $1,196,809 The petitions were signed by Ehab Eskander, authorized member. A. A copy of Hawthorne Hall's list of its eight largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/ohsb13-53234.pdf B. A copy of Oakland Manor's list of its eight largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/ohsb13-53236.pdf C. A copy of Rotunda Court's list of its eight largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/ohsb13-53239.pdf D. A copy of Clarmound Vista's list of its eight largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/ohsb13-53241.pdf HEALTHWAREHOUSE.COM INC: Incurs $1.6 Million Net Loss in Q3 ----------------------------------------------------------- HealthWarehouse.com, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $1.60 million on $2.63 million of net sales for the three months ended Sept. 30, 2012, as compared with a net loss of $1.33 million on $2.78 million of net sales for the same period during the prior year. For the nine months ended Sept. 30, 2012, the Company reported a net loss of $4.75 million on $8.78 million of net sales, as compared with a net loss of $3.50 million on $7.58 million of net sales for the same period a year ago. The Company reported a net loss of $5.71 million in 2011, compared with a net loss of $3.69 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $1.69 million in total assets, $8.52 million in total liabilities and a $6.83 million total stockholders' deficiency. A copy of the Form 10-Q is available for free at: http://is.gd/emHFID About HealthWarehouse.com HealthWarehouse.com, Inc., headquartered in Florence, Kentucky, is a U.S. licensed virtual retail pharmacy ("VRP") and healthcare e- commerce company that sells brand name and generic prescription drugs as well as over-the-counter ("OTC") medical products. In the auditors' report accompanying the consolidated financial statement for the year ended Dec. 31, 2011, Marcum LLP, in New York, expressed substantial doubt about HealthWarehouse.com's ability to continue as a going concern. The independent auditors noted that the Company has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. HELLER EHRMAN: Greenberg to Pay $5MM to End Malpractice Row ----------------------------------------------------------- Sindhu Sundar of BankruptcyLaw360 reported that Greenberg Traurig LLP on Thursday agreed to pay $4.9 million to Heller Ehrman LLP to settle the bankrupt law firm's malpractice suit alleging Greenberg hid a conflict of interest when it represented Heller Ehrman around the time of the 2008 bankruptcy filing. According to the report, in a motion to approve the settlement filed in California federal court, Heller Ehrman said the parties, who entered into mediation in January, had agreed to the settlement after wading through hundreds of thousands of pages of discovery, in order to avoid incurring additional expenses. About Heller Ehrman Headquartered in San Francisco, California, Heller Ehrman, LLP -- http://www.hewm.com/-- was an international law firm of more than 730 attorneys in 15 offices in the United States, Europe, and Asia. Heller Ehrman filed a voluntary Chapter 11 petition (Bankr. N.D. Cal., Case No. 08-32514) on Dec. 28, 2008. Members of the firm's dissolution committee led by Peter J. Benvenutti approved a plan dated Sept. 26, 2008, to dissolve the firm. The Hon. Dennis Montali presides over the case. Pachulski Stang Ziehl & Jones LLP assisted the Debtor in its restructuring effort. The Official Committee of Unsecured Creditors is represented by Felderstein Fitzgerald Willoughby & Pascuzzi LLP. The firm estimated assets and debts at $50 million to $100 million as of the Petition Date. According to reports, the firm had roughly $63 million in assets and 54 employees at the time of its filing. The Court confirmed Heller Ehrman's Plan of Liquidation in September 2010. HORNE INTERNATIONAL: Appoints Dallas Evans as CEO ------------------------------------------------- Dallas Evans has been named to serve as Chief Executive Officer of Horne International, Inc., effective April 16, 2013. Mr. Evans holds a Bachelor of Science Degree in Accounting, from the University of Maryland, College Park and a Masters of Business Administration, from American University. Mr. Evans annual and total compensation are to be determined by the audit committee, after the Company returns to profitability. Fairfax, Va.-based Horne International, Inc., is an engineering services company focused on provision of integrated, systems approach based solutions to the energy and environmental sectors. Stegman & Company, in Baltimore, Maryland, expressed substantial doubt about Horne International's ability to continue as a going concern. The independent auditors noted that the Company has experienced continuing net losses for each of the last four years and as of Dec. 31, 2012, current liabilities exceeded current assets by $2.26 million. The Company reported a net loss of $1.6 million on $4.1 million of revenue in 2012, compared with a net loss of $121,000 on $5.7 million of revenue in 2011. The Company's balance sheet at Dec. 31, 2012, showed $1.2 million in total assets, $3.2 million in total liabilities, and a stockholders' deficit of $2.0 million. ICEWEB INC: Post-Effective Amendment 2 to 43MM Shares Prospectus ---------------------------------------------------------------- IceWeb, Inc., filed with the U.S. Securities and Exchange Commission a post-effective amendment no.2 to the Form S-1 registration statement relating to the periodic offers and sales by Iroquois Master Fund Ltd., Kingsbrook Opportunities Master Fund LP, Alpha Capital Anstalt and OTA, LLC, of up to 43,090,298 shares of the Company's common stock issuable upon the exercise of common stock purchase warrants held by those selling stockholders. The Company will not receive any proceeds from the sale of these shares by the selling stockholders. However, the Company will receive proceeds from the exercise of the warrants if they are exercised for cash by the selling stockholders. The Company will bear all costs relating to the registration of these shares of its common stock, other than any selling stockholder's brokerage expenses, fees, or discounts. The Company's common stock is quoted on the OTC Bulletin Board under the symbol "IWEB". The last reported sale price of the Company's common stock as reported by the OTC Bulletin Board on April 22, 2013, was $0.0301 per share. A copy of the Amended Prospectus is available at: http://is.gd/ZlG2wo About IceWEB Sterling, Va.-based IceWEB, Inc., manufactures and markets purpose-built appliances, network and cloud-attached storage solutions and delivers on-line cloud computing application services. The Company's customer base includes U.S. government agencies, enterprise companies, and small to medium sized businesses (SMB). D'Arelli Pruzansky, P.A., in Boca Raton, Florida, expressed substantial doubt about IceWEB's ability to continue as a going concern. The independent auditors noted that the Company had net losses of $6,485,048 for the year ended Sept. 30, 2012. The Company reported a net loss of $6.5 million on $2.6 million of sales in fiscal 2012, compared with a net loss of $4.7 million on $2.7 million of sales in fiscal 2011. The Company's balance sheet at Dec. 31, 2012, showed $1.78 million in total assets, $3.46 million in total liabilities and a $1.68 million total stockholders' deficit. ICEWEB INC: Amends 43 Million Common Shares Prospectus ------------------------------------------------------ IceWeb, Inc., filed with the U.S. Securities and Exchange Commission a post-effective amendment no.1 to the Form S-1 registration statement relating to the periodic offers and sales by Iroquois Master Fund Ltd., Kingsbrook Opportunities Master Fund LP, Alpha Capital Anstalt and OTA, LLC, of up to 43,090,298 shares of the Company's common stock issuable upon the exercise of common stock purchase warrants held by those selling stockholders. The warrants were issued in the Company's private placement financing on Nov. 23, 2011. The prices at which the selling stockholders may sell shares will be determined by the prevailing market price for the shares or in negotiated transactions. The Company will not receive any proceeds from the sale of these shares by the selling stockholders. However, the Company will receive proceeds from the exercise of the warrants if they are exercised for cash by the selling stockholders. The Company's common stock is quoted on the OTC Bulletin Board under the symbol "IWEB". The last reported sale price of the Company's common stock as reported by the OTC Bulletin Board on April 8, 2013, was $0.036 per share. A copy of the amended prospectus is available at: http://is.gd/COvtbB About IceWEB Sterling, Va.-based IceWEB, Inc., manufactures and markets purpose-built appliances, network and cloud-attached storage solutions and delivers on-line cloud computing application services. The Company's customer base includes U.S. government agencies, enterprise companies, and small to medium sized businesses (SMB). D'Arelli Pruzansky, P.A., in Boca Raton, Florida, expressed substantial doubt about IceWEB's ability to continue as a going concern. The independent auditors noted that the Company had net losses of $6,485,048 for the year ended Sept. 30, 2012. The Company reported a net loss of $6.5 million on $2.6 million of sales in fiscal 2012, compared with a net loss of $4.7 million on $2.7 million of sales in fiscal 2011. The Company's balance sheet at Dec. 31, 2012, showed $1.78 million in total assets, $3.46 million in total liabilities and a $1.68 million total stockholders' deficit. IMAGEWARE SYSTEMS: Chris Kuchanny Held 5.8% Stake at March 28 ------------------------------------------------------------- In an amended Schedule 13G filing with the U.S. Securities and Exchange Commission, Chris Kuchanny and his affiliates disclosed that, as of March 28, 2013, they beneficially owned 2,648,590 shares of common stock and 2,015,280 shares of common stock issuable upon exercise of Warrants of ImageWare Systems, Inc., representing 5.86% of the shares outstanding. A copy of the regulatory filing is available at http://is.gd/8AhBRe About ImageWare Systems Headquartered in San Diego, California, ImageWare Systems, Inc., is a leader in the emerging market for software-based identity management solutions, providing biometric, secure credential, law enforcement and enterprise authorization. Its "flagship" product is the IWS Biometric Engine. Scalable for small city business or worldwide deployment, the Company's biometric engine is a multi- biometric platform that is hardware and algorithm independent, enabling the enrollment and management of unlimited population sizes. The Company's identification products are used to manage and issue secure credentials, including national IDs, passports, driver licenses, smart cards and access control credentials. Its law enforcement products provide law enforcement with integrated mug shot, fingerprint LiveScan and investigative capabilities. The Company also provides comprehensive authentication security software. Imageware Systems incurred a net loss of $10.19 million in 2012, as compared with a net loss of $3.18 million in 2011. The Company's balance sheet at Dec. 31, 2012, showed $8.71 million in total assets, $6.36 million in total liabilities and $2.34 million in total shareholders' equity. INDIEPUB ENTERTAINMENT: David Smith Held 86.7% Stake at April 12 ---------------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, David E. Smith and his affiliates disclosed that, as of April 12, 2013, they beneficially owned 55,531,908 shares of common stock of indiePub Entertainment Inc. representing 86.7% of the shares outstanding. Mr. Smith previously reported beneficial ownership of 45,508,010 common shares representing 84.2% equity stake at Nov. 28, 2012. A copy of the amended regulatory filing is available at http://is.gd/8Ucq42 About indiePub indiePub Entertainment, Inc., formerly Zoo Entertainment, Inc., is a developer, publisher and distributor of interactive entertainment software for digital distribution channels. The Company reported a net loss of $25.87 million in 2011, compared with a net loss of $14.03 million in 2010. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, EisnerAmper LLP, in Edison, New Jersey, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has both incurred losses and experienced net cash outflows from operations since inception. The Company's balance sheet at Sept. 30, 2012, showed $1.94 million in total assets, $7.44 million in total liabilities and a $5.49 million total stockholders' deficit. INDY CAR WASH: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Indy Car Wash, Inc. 245 S Power Rd Mesa, AZ 85206 Bankruptcy Case No.: 13-06735 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Sarah Sharer Curley Debtor's Counsel: Christopher C. Simpson, Esq. STINSON MORRISON HECKER LLP 1850 N Central Ave #2100 Phoenix, AZ 85004 Tel: (602) 279-1600 Fax: (602) 240-6925 E-mail: csimpson@stinson.com Scheduled Assets: $482,281 Scheduled Liabilities: $1,785,945 A list of the Company's 20 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/azb13-6735.pdf The petition was signed by Frank M. Quinn, president. INSPIREMD INC: Samuel Isaly Owned 6.9% Equity Stake at April 10 --------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Samuel D. Isaly and his affiliates disclosed that, as of April 10, 2013, they beneficially owned 2,376,500 shares of common stock of InspireMD, Inc., representing 6.99% of the shares outstanding. A copy of the regulatory filing is available at: http://is.gd/yTB9r9 About InspireMD InspireMD, Inc., was organized in the State of Delaware on Feb. 29, 2008, as Saguaro Resources, Inc., to engage in the acquisition, exploration and development of natural resource properties. On March 28, 2011, the Company changed its name from "Saguaro Resources, Inc." to "InspireMD, Inc." Headquartered in Tel Aviv, Israel, InspireMD, Inc., is a medical device company focusing on the development and commercialization of its proprietary stent platform technology, Mguard. MGuard provides embolic protection in stenting procedures by placing a micron mesh sleeve over a stent. The Company's initial products are marketed for use mainly in patients with acute coronary syndromes, notably acute myocardial infarction (heart attack) and saphenous vein graft coronary interventions (bypass surgery). The Company's balance sheet at Dec. 31, 2012, showed US$11.59 million in total assets, US$11.39 million in total liabilities and a US$204,000 in total equity. InspireMD reported a net loss of US$17.59 million on US$5.35 million of revenue for the year ended June 30, 2012, compared with a net loss of US$6.17 million on US$4.67 million of revenue during the prior year. Kesselman & Kesselman, in Tel Aviv, Israel, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2012. The independent auditors noted that the Company has had recurring losses, negative cash flows from operating activities and has significant future commitments that raise substantial doubt about its ability to continue as a going concern. The Company said the following statement in its quarterly report for the period ended Dec. 31, 2012: "The Company has had recurring losses and negative cash flows from operating activities and has significant future commitments. For the six months ended December 31, 2012, the Company had losses of approximately $9.4 million and negative cash flows from operating activities of approximately $5.8 million. The Company's management believes that its financial resources as of December 31, 2012 should enable it to continue funding the negative cash flows from operating activities through the three months ended September 30, 2013. Furthermore, commencing October 2013, the Company's senior secured convertible debentures (the "2012 Convertible Debentures") are subject to a non-contingent redemption option that could require the Company to make a payment of $13.3 million, including accrued interest. Since the Company expects to continue incurring negative cash flows from operations and in light of the cash requirement in connection with the 2012 Convertible Debentures, there is substantial doubt about the Company's ability to continue operating as a going concern. These financial statements include no adjustments of the values of assets and liabilities and the classification thereof, if any, that will apply if the Company is unable to continue operating as a going concern." INSPIREMD INC: Hires Vice President of Corporate Development ------------------------------------------------------------ InspireMD, Inc., said Gwen K. Bame has joined the Company as Vice President of Corporate Development, reporting directly to Alan Milinazzo, President and CEO. "This is a new position created to strengthen our executive team with a clear focus on executing strategic programs and partnerships designed to meet our ambitious global growth objectives, said Mr. Milinazzo. "Gwen has the right blend of industry and management experience and we are delighted to welcome her to InspireMD." Ms. Bame's responsibilities will include identifying and negotiating in/out licensing agreements, analyzing strategic partnerships and structuring of joint ventures on a worldwide basis. Ms. Bame joined Covidien in 2009 upon its acquisition of Aspect Medical Systems, where she held various sales and marketing leadership positions during her tenure. She led significant market development programs directly and via strategic partnerships which drove adoption of the BIS technology. Prior to her time at Covidien, Ms. Bame spent 12 years with Boston Scientific in the cardiology business in sales, marketing and corporate accounts. During her career at BSC, she negotiated roughly $350 million in contracted business across multiple business units. Gets OK Begin Regulatory Trial InspireMD received an approval with conditions for its Investigational Device Exemption (IDE) application with the U.S. Food and Drug Administration (FDA). An approval with conditions indicates that the FDA concurs with the overall trial design and while minor details are being finalized, allows the company to initiate enrollment in the MASTER II IDE trial. The multi-center, randomized study will consist of 1,114 patients suffering from ST Elevation Myocardial Infarction (STEMI), throughout 35 sites in the U.S. and an additional 35 sites in Europe, and will support the Company's application to market its MGuardTM Prime MicroNetTM covered coronary stent system in the United States. Gregg Stone, MD, of The Cardiovascular Research Foundation, and Dr. Jose P. S. Henriques of the Academic Medical Center Amsterdam in the Netherlands, will serve as Principal Investigators for the trial, which will consist of two co-primary endpoints: superiority in complete ST resolution and non-inferiority in death and target vessel MI. In addition, a 356 patient sub-study will be conducted to assess the effect of MGuard EPS on vessel infarct size, as measured through cardiac Magnetic Resonance Imaging (MRI). "The approval to begin the US FDA trial is a significant milestone for the company," commented Alan Milinazzo, InspireMD's CEO and President. "This trial will provide an excellent opportunity to validate the safety and effectiveness of MGuard EPS in another large multi-center, randomized trial, comparing both bare metal and drug eluting stents, the current therapy for STEMI patients." The FDA trial will be known as The MASTER II (MGuardTM for Acute ST Elevation Reperfusion), the second in a series of clinical studies meant to both validate the effectiveness of the MGuard EPS platform, as well as achieve registration with the appropriate regulatory authorities worldwide. InspireMD's EPS technology previously yielded positive results in the MASTER I findings, which revealed a statistically and clinically significant acute advantage of MGuard EPS with regard to ST segment resolution. As a result, MGuard EPS may hold the potential to lower the incidence of adverse events and prolong survival of patients suffering from acute myocardial infarction, About InspireMD InspireMD, Inc., was organized in the State of Delaware on Feb. 29, 2008, as Saguaro Resources, Inc., to engage in the acquisition, exploration and development of natural resource properties. On March 28, 2011, the Company changed its name from "Saguaro Resources, Inc." to "InspireMD, Inc." Headquartered in Tel Aviv, Israel, InspireMD, Inc., is a medical device company focusing on the development and commercialization of its proprietary stent platform technology, Mguard. MGuard provides embolic protection in stenting procedures by placing a micron mesh sleeve over a stent. The Company's initial products are marketed for use mainly in patients with acute coronary syndromes, notably acute myocardial infarction (heart attack) and saphenous vein graft coronary interventions (bypass surgery). The Company's balance sheet at Dec. 31, 2012, showed US$11.59 million in total assets, US$11.39 million in total liabilities and a US$204,000 in total equity. InspireMD reported a net loss of US$17.59 million on US$5.35 million of revenue for the year ended June 30, 2012, compared with a net loss of US$6.17 million on US$4.67 million of revenue during the prior year. Kesselman & Kesselman, in Tel Aviv, Israel, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2012. The independent auditors noted that the Company has had recurring losses, negative cash flows from operating activities and has significant future commitments that raise substantial doubt about its ability to continue as a going concern. The Company said the following statement in its quarterly report for the period ended Dec. 31, 2012: "The Company has had recurring losses and negative cash flows from operating activities and has significant future commitments. For the six months ended December 31, 2012, the Company had losses of approximately $9.4 million and negative cash flows from operating activities of approximately $5.8 million. The Company's management believes that its financial resources as of December 31, 2012 should enable it to continue funding the negative cash flows from operating activities through the three months ended September 30, 2013. Furthermore, commencing October 2013, the Company's senior secured convertible debentures (the "2012 Convertible Debentures") are subject to a non-contingent redemption option that could require the Company to make a payment of $13.3 million, including accrued interest. Since the Company expects to continue incurring negative cash flows from operations and in light of the cash requirement in connection with the 2012 Convertible Debentures, there is substantial doubt about the Company's ability to continue operating as a going concern. These financial statements include no adjustments of the values of assets and liabilities and the classification thereof, if any, that will apply if the Company is unable to continue operating as a going concern." INTELLIPHARMACEUTICS INT'L: To Present at 12th Needham Conference ----------------------------------------------------------------- Intellipharmaceutics International Inc. said that Shameze Rampertab, vice president Finance and chief financial officer, will present a Company overview at the 12th Annual Needham Healthcare Conference at the Westin NY Grand Central Hotel in New York at 3:40pm EDT on Wednesday, May 1, 2013. The presentation will be webcast live and may be accessed through the Investor Relations' Events and Presentations section on Intellipharmaceutics' Web site at www.intellipharmaceutics.com. Interested persons must go to the Web site at least 15 minutes prior to the event to register, download and install any necessary audio/video software. An archived replay will also be available for 90 days following the live presentation. About Intellipharmaceutics International Intellipharmaceutics International Inc. is a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. Deloitte LLP, in Toronto, Canada, expressed substantial doubt about Intellipharmaceutics' ability to continue as a going concern following the annual results for the period ended Nov. 30, 2012, citing the Company's recurring losses from operations and accumulated deficit. The Company reported a net loss of US$6.14 million on US$107,091 of research and development revenue for fiscal 2012, compared with a net loss of US$4.88 million on US$501,814 of research and development revenue for fiscal 2011. The Company's balance sheet at Feb. 28, 2013, showed US$2.55 million in total assets, US$5.20 million in total liabilities and a $2.65 million shareholders' deficiency. J.C. PENNEY: Said to Have Pledge for $1.75BB Loan From Goldman -------------------------------------------------------------- Emily Glazer and Mike Spector, writing for The Wall Street Journal, report that people familiar with the matter said Friday J.C. Penney Co. has a commitment for a $1.75 billion loan being arranged by investment bank Goldman Sachs Group Inc. According to the sources, the loan: -- would be secured by assets including a "significant" portion of the company's real estate, including stores, the company's headquarters and distribution centers; -- would be backed by Penney's accounts receivable, inventory and intellectual property; -- would bear an interest rate around 6.5%; and -- would come due after five years. One person told WSJ that Penney has yet to sign the loan. About J.C. Penney Plano, Texas-based J.C. Penney Company, Inc. is one of the U.S.'s largest department store operators with about 1,100 locations in the United States and Puerto Rico. J.C. Penney disclosed a net loss of $985 million in 2012, as compared with a net loss of $152 million in 2011. The Company's balance sheet at Feb. 2, 2013, showed $9.78 billion in total assets, $6.61 billion in total liabilities and $3.17 billion in total stockholders' equity. * * * The Company carries Moody's Investors Service's B3 Corporate Family Rating with negative outlook. Early in March 2013, Standard & Poor's Ratings Services lowered its corporate credit rating on Penney to 'CCC+' from 'B-'. The outlook is negative. At the same time, S&P lowered the issue- level rating on the company's unsecured debt to 'CCC+' from 'B-' and maintained its '3' recovery rating on this debt, indicating S&P's expectation of meaningful (50% to 70%) recovery for debtholders in the event of a payment default. "The downgrade reflects the performance erosion that has accelerated throughout the previous year and seems likely to persist over the next 12 months," explained Standard & Poor's credit analyst David Kuntz. At the same time, Fitch Ratings downgraded the Company's Issuer Default Ratings to 'B-' from 'B'. The Rating Outlook is Negative. The rating downgrades reflect Fitch's concerns that there is a lack of visibility in terms of the Company's ability to stabilize its business in 2013 and beyond after a precipitous decline in revenues leading to negative EBITDA of $270 million in 2012. Penney, Fitch said, will need to tap into additional funding to cover a projected FCF shortfall of $1.3 billion to $1.5 billion in 2013, which could begin to strain its existing sources of liquidity. In February 2013, Penney received a notice of default from a law firm representing more than 50% of its 7.4% Debentures due 2037. The Company has filed a lawsuit in Delaware Chancery Court seeking to block efforts by the bondholder group to declare a default on the 2037 bonds. Penney also asked lawyers at Brown Rudnick LLP to identify the investors they represent. In March 2013, Penney received a letter from bondholders withdrawing and rescinding the Notice of Default. On April 12, 2013, Penney borrowed $850 million out of its $1.85 billion committed revolving credit facility with JPMorgan Chase Bank, N.A., as Administrative Agent, and Wells Fargo Bank, National Association, as LC Agent. Penney said the move was to enhance the Company's financial flexibility and position. J.M. HUBER: Improved Earnings Prompt Moody's to Lift CFR to Ba2 --------------------------------------------------------------- Moody's Investors Service upgraded J.M. Huber Corporation's Corporate Family Rating to Ba2 from B1, and moved the company's outlook to stable from positive. Moody's also upgraded the company's unsecured notes due 2019 to Ba3 from B2. The two notch upgrade reflects significantly improved earnings and cash flow generation in Huber's businesses, particularly in the Engineered Woods division. "The substantial increase in Engineered Wood margins over the past year may not be sustainable over the long term, but it should allow the company to generate extremely strong financial metrics and enable the company to accelerate debt reduction over the next two to three years, given the anticipated improvement in US housing starts, said Bill Reed, Vice President at Moody's. Ratings upgraded: J.M. Huber Corporation CFR -- Ba2 from B1 PDR -- Ba2-PD from B1-PD $225 million Sr Unsecured Notes due 2019 -- Ba3 (LGD4, 69%) from B2 (LGD4, 63%) Outlook -- Stable from Positive Ratings Rationale: Huber's Ba2 CFR reflects its improved profitability and cash flow over the past 12-18 months as the HEW business has become a more meaningful contributor to earnings. Prior to this upturn, Huber had significantly restructured its operations, allowing the engineered woods business to operate on a break-even basis in an environment of weak demand. This has taken some downside volatility out of Huber's business and will allow the company to fully take advantage of any upside in the business as demand continues to ramp up. Additionally these incremental earnings will substantially increase free cash flow in 2013 and 2014 providing the flexibility to meaningfully reduce debt. This is extremely important given management's stated objective of obtaining an investment grade rating over time. The company's other two businesses CP Kelco and Engineered Materials continue to improve but at a more measured pace. These businesses have leading market positions in many of their product lines and have historically been more stable than the HEW business. These businesses still generate the majority of the company's earnings and are the core supporters of Huber's Ba2 CFR. Huber has a good liquidity profile primarily supported by its $250 million ABL revolving credit facility due 2016 ($137 million of availability as of December 31, 2012) and $182 million of cash balances as of December 31, 2012 (including $110 million of which is to pre-fund a private placement maturity in early 2014). Moody's expects Huber to be free cash flow positive in 2013 despite elevated capital expenditures to fund future growth. The company is subject to fixed charge coverage and interest coverage ratios, under which the company will likely have significant headroom over the next 12-18 months. The outlook is currently stable and has limited upside over the next year or two due to concerns over the potential volatility in Huber's HEW business and the degree to which Huber will reduce its balance sheet debt. The rating could be downgraded if Debt to EBITDA were to rise sustainably over 4.0x (including Moody's standard adjustments) , or if Retained Cash flow to Debt were to be consistently under 10%. The principal methodology used in this rating was Global Chemical Industry 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. J.M. Huber is a New Jersey-based, privately-held, diversified specialty chemical and engineered materials company founded in 1883. The company runs its operations through three main business segments: CP Kelco (CPK), Huber Engineered Materials (HEM), and Huber Engineered Woods (HEW). The company has been restructuring and refocusing its business over the last three years. As part of this restructuring management sold much of its non-core timber land holdings in 2012, and sold its energy business at the end of 2011. Revenues for the LTM ended December 31, 2012 were $1.7 billion. JONES GROUP: Moody's Reviews Ba2 CFR for Possible Downgrade ----------------------------------------------------------- Moody's Investors Service placed The Jones Group's Inc.'s Ba2 Corporate Family and Ba2-PD Probability of Default Ratings on review for downgrade. The Ba3 ratings assigned to the company's various senior unsecured notes were also placed on review for downgrade. The company's SGL-2 Speculative Grade Liquidity rating is unchanged. The following ratings were placed on review for downgrade. LGD assessments are subject to change. Corporate Family Rating: Ba2 Probability of Default Rating: Ba2-PD Various senior unsecured notes: Ba3 (LGD 4, 66%) Senior Unsecured shelf rating: (P) Ba3 Ratings Rationale: The review for downgrade considers the company's preliminary first quarter results which indicate that adjusted operating income (as defined by the company) is expected to fall more than 30% from the prior year levels and that the company also expects a year-on-year decline in earnings in the second quarter of 2013. As a result, Moody's expects the company's credit metrics to remain at elevated levels and are unlikely to meaningfully improve over the course of 2013 as previously expected. The existing negative rating outlook considered that following weak performance in early 2012 and the increase in funded debt when the company concluded a $100 million bond offering in September 2012 that the ratings could be pressured if Jones was unable to meaningfully reverse negative trends in operating earnings. Moody's review will focus on the company's strategies to improve profitability, including its announcement that the company will be closing approximately 170 underperforming retail stores (the company ended 2012 with 594 stores) as well as streamlining certain parts of its wholesale business. The review will also focus on the company's ability to generate returns from past acquisitions in premium price channels and international markets to offset any challenges at the company's owned retail business as well as the company's brands, such as its Jeanswear segment, that cater to more moderate priced businesses. The company's liquidity profile remains good, as it ended 2012 with $150 million of cash, it has access to a substantially undrawn $650 million asset-based credit facility and that these sources of liquidity are ample to cover the company's upcoming maturity of $250 million of unsecured notes that are due in September 2014. The principal methodology used in this rating was the Global Apparel Industry Methodology published in May 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. Headquarters in New York, NY, Jones Group is a designer, marketer, wholesaler and retailer of apparel, footwear, jeanswear and other fashion accessories. Its largest brands include Nine West, Jones New York, Anne Klein, Stuart Weitzman and Gloria Vanderbilt. FY 2012 revenues were approximately $3.8 billion. K-V PHARMACEUTICAL: Lenders Slam Creditors' Disclosures Objections ------------------------------------------------------------------ Stewart Bishop of BankruptcyLaw360 reported that a group of lenders and noteholders, including Silver Point Capital LP, on Thursday dismissed concerns from unsecured creditors of K-V Pharmaceutical Co. about the bankrupt company's disclosure statement for its potential reorganization plan, saying the creditors' objections are "simply wrong." According to the report, the debtor-in-possession lenders and ad hoc senior noteholders group contend that the creditors' committee's objection to the disclosure statement exhibits all the "classic signs" of a creditor trying to get whatever hold-up value it can get from a debtor and senior lenders. 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. Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R. Fife, Esq., represent an Ad Hoc Senior Noteholders Group. KINDRED HEALTHCARE: No Change on Moody's B1 CFR After Assets Sale ----------------------------------------------------------------- Moody's Investors Service commented that Kindred Healthcare, Inc.'s announcement that it has entered into a definitive agreement to sell 17 non-strategic facilities is a modest credit positive. Moody's understands that Kindred expects after tax proceeds of approximately $180 million, which will be used to repay amounts outstanding under its revolving credit facility. This is a modest credit positive as it will improve Kindred's liquidity. However, Moody's estimates that the pro forma impact on leverage after also considering the reduced lease costs and EBITDA contribution associated with the facilities being sold is negligible. Therefore, there is no change to Kindred's ratings or outlook, including its B1 Corporate Family Rating and B1-PD Probability of Default Rating. The rating outlook remains stable. Kindred Healthcare, Inc., headquartered in Louisville, Kentucky, provided healthcare services in 116 long-term acute care (LTAC) hospitals, six inpatient rehabilitation hospitals, 223 nursing and rehabilitation centers, 27 sub-acute units, 101 hospice, home health and non-medical home care locations, 105 inpatient hospital based rehabilitation units and operated a contract rehabilitation services business at December 31, 2012. For the year ended December 31, 2012 the company recognized revenue of approximately $6.2 billion. KIT DIGITAL: Owners to Be Paid $2MM If Other Plan Deal Is Pursued ----------------------------------------------------------------- KIT digital Inc. intends to implement a restructuring plan sponsored by several of its largest equity holders, namely Prescott Group Capital Management, JEC Capital Partners, and Ratio Capital Partners. KIT says in bankruptcy court filings that the shareholders would not have entered into a plan support agreement without certain bidder incentives. Accordingly, the Debtor asks the Court for authorization to pay the plan sponsors up to $500,000 in expense reimbursements and a break-up fee of $1.5 million in the event the Debtor pursue an alternative transaction. KIT says the shareholders-backed restructuring will enable the Debtor to transform its operations around four of its profitable subsidiaries, Ioko 365 Limited, Polymedia S.p.A., KIT digital France, S.A. and KIT digital -- Americas Inc., while shedding underperforming non-core businesses. The Debtor's business generated revenues of $134.5 million in 2012. The Debtor says payment of the expense reimbursement and its conditional agreement to pay the break up fee are reasonable and necessary conditions to ensure the best possible recovery for all of the Debtor's stakeholders. Road to Bankruptcy KIT digital blamed the bankruptcy filing on a number of significant setbacks. In early 2012, the Debtor's then-CEO resigned amid an SEC investigation into certain of his trading practices with respect to the Debtor's stock. Thereafter, the Debtor's audit committee uncovered financial irregularities and the Debtor announced that it would need to restate historical financials from 2009 onward, sparking a flurry of securities lawsuits and derivative claims along with attendant litigation costs. The company was also incurring extensive losses from unprofitable acquisitions made over the prior 24 months. Mounting legal expenses and the costs of divesting and liquidating the unprofitable non-core businesses thus caused the Debtor to experience a near-term liquidity crunch. On April 1, 2013, the Debtor failed to make a scheduled payment in respect to a secured loan from an affiliate of Western Technology Investments. As of the Petition Date, about $9.8 million is outstanding under the WTI loans, including interest. The Debtor also has $2.7 million owing to JEC on account of an unsecured loan provided in October 2012. The Debtor has $9.2 million in outstanding trade debt. Deal With Equity Holders Deutsche Bank, the Debtor's investment banker, conducted an extensive marketing process over the past year canvassing a wide range of over 56 financial and strategic players, as well as possible stand-alone financing options to accompany the Debtor in a chapter 11 process. However, no firm interest in the purchase of the Debtor resulted. The Debtor later was approached by a group of shareholders led by JEC, the private equity firm affiliate of KDI's CEO, with a proposal for a restructuring. The Debtor believes the contemplated reorganization marks the best opportunity for the Debtor to preserve its global operations and the jobs of more than 800 employees worldwide. The Plan Support Agreement provides the Debtor with the resources necessary to a reorganization plan that is expected to pay allowed unsecured claims in full while also providing a meaningful recovery to the Debtor's equity holders in the form of the opportunity to participate in the reorganized company. Key terms of the Plan Support Agreement are: * The Plan Sponsor Group will fund an amount equal to $25 million in cash in exchange for approximately 89% of the equity interests in reorganized KDI. * The Debtor anticipates that the cash paid by the Plan Sponsor Group will be sufficient to pay claims pursuant to the Plan, other than subordinated litigation claims under Section 510(b) of the Bankruptcy Code. * Pursuant to the Plan, the plan sponsor group will offer warrants to be distributed to the Debtor's stakeholders to purchase stock of the Reorganized Debtor at the same price as the Plan Sponsor Group. Proceeds of the Warrants will be used to redeem up to 50% of the equity interests provided to the Plan sponsor group, with the balance of the proceeds (if any) to be used for working capital for the Reorganized Debtor. The PSA requires the Debtor to emerge from chapter 11 within 95 days of the filing date. The Chapter 11 Plan Under the Plan, claims and interests will be treated as follows: Class Claim or Interest Treatment ----- ----------------- --------- -- Administrative Claims Paid in full in Cash on the Effective Date [Unclassified; Not voting on Plan] -- DIP Facility Claims Paid in full in Cash and Reorganized KDI Class A Common Stock [Unclassified; Not voting on Plan] -- Priority Tax Claims Paid in full in Cash on the Effective Date [Unclassified; Not voting on Plan] 1 Priority Non-Tax Claims Paid in full in Cash on the Effective Date [Unimpaired; Not entitled to vote; Deemed to accept the Plan] 2 Secured Claims of WTI Cash of $9 million and Reorganized KDI Class A Common Stock at the same price per share as the Reorganized Class B Common Stock acquired by the Plan Sponsor Group for the remainder of WTI's Secured Claim in the amount of $650,000 [Impaired; Entitled to vote] 3 Other Secured Claims Paid in full in Cash on the Effective Date [Unimpaired; Not entitled to vote; deemed to accept the Plan] 4 General Unsecured Claims Paid from Available Cash [Impaired; entitled to Vote] 5 Securities Litigation Claims Paid pro rata from available Insurance proceeds [Impaired; Entitled to Vote] 6 Intercompany Claims Canceled or waived as determined by the Debtor and the Plan Sponsor Group prior to the Effective Date [Unimpaired; Not entitled to vote; deemed to accept the Plan] 7 Litigation Claims Receive their Pro Rata Share of Available Cash and Reorganized KDI Warrants after payment of General Unsecured Claims in full [Impaired; Entitled to vote] 8 Interests Receive their Pro Rata Share of Available Cash and Reorganized KDI Warrants after payment of General Unsecured Claims in full [Impaired; Entitled to Vote] The Debtor has not filed the explanatory disclosure statement. A copy of the Chapter 11 plan is available for free at http://bankrupt.com/misc/KIT_Ch11_Plan.pdf A copy of the CFO's declaration in support of the first day motions is available for free at: http://bankrupt.com/misc/KIT_first_day_declaration.pdf About KIT digital New York-based KIT digital Inc. -- http://www.kitd.com/-- is a video management software and services company. KIT digital services nearly 2,500 clients in 50+ countries including some of the world's biggest brands, such as Airbus, The Associated Press, AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky Deutschland, Sky Italia, Telecom Argentina, Telecom Italia, Telefonica, Universal Studios, Verizon, Vodafone VRT and Volkswagen. KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 13-11298) in Manhattan on April 25, 2013k, estimating more than $10 million in both assets and debts. KIT's operating subsidiaries, including Ioko 365, Polymedia, Kewego, Multicast and Megahertz are not included in the Chapter 11 filing. Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell & Giuliani LLP, in New York, serve as counsel to the Debtor. American Legal Claims Services LLC is the claims and noticing agent and the administrative agent. KIT DIGITAL: Has $3-Mil. DIP Financing From JEC ----------------------------------------------- KIT digital Inc. has arranged postpetition financing from an affiliate of JEC Capital Partners LLC, one of the members of the plan sponsor group. The Debtor thus asks the Court for approval to obtain $3 million of DIP financing and utilize cash collateral. Pursuant to the terms of the Debtor-In-Possession Credit Agreement, dated April 25, 2013, JEC II Associates, LLC, has agreed to provide the Debtor with a $3 million super priority loan, secured by a lien on all of the assets of the Debtor that is junior to the Debtor's valid prepetition secured debt. Upon confirmation of the Plan, the DIP Financing will be satisfied by (i) payment of all accrued interest in cash and (ii) equitization of the outstanding principal into 10.71% of the total outstanding shares of common stock of the Reorganized Debtor. The DIP loan will bear interest at 13% per annum and mature on July 29, 2013. The DIP lender has agreed to provide $1.2 million upon interim approval of the DIP financing. Absent the DIP Loan, the Debtor says it could be forced to cease operations within a few weeks, thereby immediately impeding its ability to reorganize. The DIP Lender would not have provided the DIP Loan unless it receives a lien on the Debtor's assets and a superpriority claim in the Debtor's chapter 11 case. The DIP Lender's liens, however, will be junior to valid existing liens on those assets. Cash Collateral The Debtor is also seeking authority to use cash collateral of the DIP Lender and Western Technology Investments, its prepetition lender. The Debtor intends to continue using its operating account at HSBC in the ordinary course of its operations. The operating account is pledged to WTI, so out of an abundance of caution, the Debtor is seeking approval to use WTI's cash collateral and to have access to the operating account without interference from WTI. WTI is adequately protected for any diminution in value because (i) minimal cash collateral exists in the operating account as of the Petition Date and funds in the account going forward will be proceeds of the DIP Loan which is incremental to WTI's cash collateral and (ii) the Plan Sponsor Group's proposal values the assets of the Debtor far in excess of the amounts outstanding under the WTI Loans, thereby manifesting a significant, existing equity cushion for WTI. Moreover, the proceeds of the DIP Loan will be used to preserve the value of the Debtor's assets during the course of this chapter 11 case, which I believe will further insulate WTI from any diminution in value of its collateral. About KIT digital New York-based KIT digital Inc. -- http://www.kitd.com/-- is a video management software and services company. KIT digital services nearly 2,500 clients in 50+ countries including some of the world's biggest brands, such as Airbus, The Associated Press, AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky Deutschland, Sky Italia, Telecom Argentina, Telecom Italia, Telefonica, Universal Studios, Verizon, Vodafone VRT and Volkswagen. KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 13-11298) in Manhattan on April 25, 2013k, estimating more than $10 million in both assets and debts. KIT's operating subsidiaries, including Ioko 365, Polymedia, Kewego, Multicast and Megahertz are not included in the Chapter 11 filing. Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell & Giuliani LLP, in New York, serve as counsel to the Debtor. American Legal Claims Services LLC is the claims and noticing agent and the administrative agent. KIT DIGITAL: Proposes Procedures to Protect NOLs ------------------------------------------------ KIT digital Inc. asks the Court to enter interim and final orders (a) establishing notification and hearing procedures regarding the trading of, or declarations of worthlessness for federal or state tax purposes with respect to the equity securities in the Debtor or of any beneficial interest therein that must be complied with before trades or transfers of such securities or declarations of worthlessness become effective, and (b) ordering that any purchase, sale, or other transfer of, or declaration of worthlessness with respect to, equity securities in violation of the procedures will be void ab initio. The Debtor has incurred, and is currently incurring, significant net operating losses, amounting to $75 million as of the Petition Date translating to potential tax savings of $26.25 million. The Debtor's NOLs consist of losses generated in any given or prior tax year and can be "carried forward" to up to 20 subsequent tax years to offset the Debtor's future taxable income, thereby reducing future aggregate tax obligations. NOLs also may be utilized to offset taxable income generated by transactions completed during the chapter 11 case. The Debtor says that the notification and hearing procedures for the trading of and declarations of worthlessness with respect to the equity securities will protect and preserve the Debtor's valuable tax attributes, including the NOLs, as well as certain other tax and business credits, ultimately benefitting all of the Debtor's stakeholders. As to stock trading, the proposed procedures will affect only holders of the equivalent of more than approximately 2.7 million shares of Common Stock (i.e., 4.5% or more of outstanding common stock) and parties who are interested in purchasing sufficient equity securities to result in such party becoming a holder of the equivalent of at least approximately 2.7 million shares of common stock. As to worthless stock deductions, the proposed rules will affect only holders of the equivalent of 50% or more of the Debtor's common stock. About KIT digital New York-based KIT digital Inc. -- http://www.kitd.com/-- is a video management software and services company. KIT digital services nearly 2,500 clients in 50+ countries including some of the world's biggest brands, such as Airbus, The Associated Press, AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky Deutschland, Sky Italia, Telecom Argentina, Telecom Italia, Telefonica, Universal Studios, Verizon, Vodafone VRT and Volkswagen. KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 13-11298) in Manhattan on April 25, 2013k, estimating more than $10 million in both assets and debts. KIT's operating subsidiaries, including Ioko 365, Polymedia, Kewego, Multicast and Megahertz are not included in the Chapter 11 filing. Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell & Giuliani LLP, in New York, serve as counsel to the Debtor. American Legal Claims Services LLC is the claims and noticing agent and the administrative agent. KIT DIGITAL: Proposes ALCS as Claims & Administrative Agent ----------------------------------------------------------- KIT digital Inc. filed applications to employ American Legal Claim Services, LLC, as claims and noticing agent and as administrative agent. Although the Debtor has not yet filed its schedules of assets and liabilities, it anticipates that there will be hundreds of creditors and other parties in interest in this chapter 11 case. In view of the number of anticipated creditors and parties in interest and the complexity of its business, the Debtor submits that the appointment of ALCS as claims agent is both necessary and in the best interests of the Debtor, its estate and other parties in interest. In the application to hire ALCS as administrative agent, the Debtor said that ALCS will also assist the Debtor in the preparation of the schedules of assets and liabilities and the tabulation of votes in connection with the Chapter 11 plan of the Debtor. ALCS will charge the Debtor for its services at the rates or prices set forth in the "fee schedule" agreed to by the parties. The fee schedule was not included in documents posted in ALCS's Web site. About KIT digital New York-based KIT digital Inc. -- http://www.kitd.com/-- is a video management software and services company. KIT digital services nearly 2,500 clients in 50+ countries including some of the world's biggest brands, such as Airbus, The Associated Press, AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky Deutschland, Sky Italia, Telecom Argentina, Telecom Italia, Telefonica, Universal Studios, Verizon, Vodafone VRT and Volkswagen. KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 13-11298) in Manhattan on April 25, 2013k, estimating more than $10 million in both assets and debts. KIT's operating subsidiaries, including Ioko 365, Polymedia, Kewego, Multicast and Megahertz are not included in the Chapter 11 filing. Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell & Giuliani LLP, in New York, serve as counsel to the Debtor. American Legal Claims Services LLC is the claims and noticing agent and the administrative agent. LEHMAN BROTHERS: Carter Ledyard Malpractice Suit Tossed ------------------------------------------------------- Matthew Heller of BankruptcyLaw360 reported that a New York appeals court on Thursday affirmed the dismissal of a suit alleging Carter Ledyard & Milburn LLP botched a whistleblower case, finding a former employee of Lehman Brothers Holdings Inc. couldn't show he would have won the underlying case if not for the alleged negligence of Carter Ledyard. According to the opinion, a trial judge did not err in tossing Angelo Meimeteas' malpractice claim, which arose out of allegations that Lehman abruptly fired him for objecting to colleagues' unethical business practices, the report related. He retained Carter Ledyard as counsel. 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. 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. LEHMAN BROTHERS: NY Giants Again Seek Docs in $300MM Stadium Row ---------------------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that a unit of the NFL's New York Giants made another attempt Thursday to get its hands on documents connected to a $300 million dispute over financing for MetLife Stadium, asking a federal judge in New York to force an affiliate of Lehman Brothers Holdings Inc to give up the evidence. According to the report, Giants Stadium LLC had asked the U.S. Bankruptcy Court for the Southern District of New York to compel discovery in the case this past September, but didn't find what it was looking for after LBHI objected. 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. 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. LIBERTY MEDICAL: Settles $40 Million Feud With Alere ---------------------------------------------------- Lance Duroni of BankruptcyLaw360 reported that bankrupt Liberty Medical Supply Inc. has agreed to hand over its Medicare diabetes supply delivery business to Alere Inc. -- along with $22.5 million -- to satisfy a $40 million loan and resolve a contract dispute between the rivals, according to settlement papers filed Wednesday in Delaware. According to the report, the deal dispenses with all of Liberty Medical's secured debt and allows the company to retain its Medicare insulin pump business, while Alere receives assets that it had bargained to acquire under the loan agreement. About Liberty Medical Entities that own diabetics supply provider Liberty Medical led by ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than three months after a management buy-out and amid a notice by the lender who financed the transaction that it's exercising an option to acquire the business. Liberty has been in business for 22 years serving the needs of both type 1 and type 2 diabetic patients. Liberty is a mail order provider of diabetes testing supplies. In addition to diabetes testing supplies, the Debtors also sell insulin pumps and insulin pump supplies, ostomy, catheter and CPAP supplies and operate a large mail order pharmacy. Liberty operates in seven different locations and has 1,684 employees. The Debtors have tapped Greenberg Traurig, LLP as counsel; Ernst & Young LLP to provide investment banking advice; and Epiq Bankruptcy Solutions, LLC, as claims and noticing agent for the Clerk of the Bankruptcy Court. LIFECARE HOLDINGS: Reaches Deal Backing $320MM Carlyle Sale ----------------------------------------------------------- Jamie Santo of BankruptcyLaw360 reported that LifeCare Holdings Inc. and its creditors committee reached a settlement Friday that would provide unsecured creditors with about $3.5 million in cash in exchange for the committee supporting the hospital group's Chapter 11 plan, which includes its $320 million sale to private equity firm Carlyle Group LP. According to the report, the agreement should be approved because it represents an outstanding result for creditors and will benefit all parties involved in the case, the official committee of unsecured creditors said in a motion filed in Delaware bankruptcy court. About LifeCare LCI Holding Company, Inc., and its affiliates, doing business as LifeCare Hospitals, operate eight "hospital within hospital" facilities and 19 freestanding facilities in 10 states. The hospitals have about 1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio and Nevada. LifeCare is controlled by Carlyle Group, which holds 93.4% of the stock following a $570 million acquisition in August 2005. LCI Holding Company, Inc., and its affiliates, including LifeCare Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13319) on Dec. 11, 2012, with plans to sell assets to secured lenders. Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps, Slate Meagher & Flom LLP, serve as counsel to the Debtors. Rothschild Inc. is the financial advisor. Huron Management Services LLC will provide the Debtors an interim chief financial officer and certain additional personnel; and (ii) designate Stuart Walker as interim chief financial officer. The steering committee of lenders is represented by attorneys at Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent under the prepetition and postpetition secured credit facility is represented by Simpson Thacher & Barlett LLP. The Debtors disclosed assets of $422 million and liabilities totaling $575.9 million as of Sept. 30, 2012. As of the bankruptcy filing, total long-term obligations were $482.2 million consisting of, among other things, institutional loans and unsecured subordinated loans. A total of $353.4 million is owing under the prepetition secured credit facility. A total of $128.4 million is owing on senior subordinated notes. LifeCare Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed $24,028,730 in assets and $484,372,539 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves as its financial advisor. An auction on the sale of substantially all of the Debtors' assets was conducted on March 20. The Debtors have agreed to sell their assets to their existing lenders in exchange for debt, absent higher and better offers. MAXCOM TELECOM: Considers Bankruptcy After Takeover Deal Collapse ----------------------------------------------------------------- Crayton Harrison, writing for Bloomberg News, reported that Maxcom Telecomunicaciones SAB said it's considering operational and financial alternatives, including a Chapter 11 bankruptcy filing, after a takeover deal with Ventura Capital Privado SA collapsed. The Mexican phone company said in a statement that only 61.93% of old notes were tendered in a bond exchange, not enough to complete a swap, which was a requirement for an equity offer from Ventura Capital, the Bloomberg report related. "In light of this outcome, Maxcom is considering all of its alternatives including, but not limited to, commencement of a Chapter 11 case or other restructuring proceeding," the company said in the statement, Bloomberg cited. The Mexico City-based operator didn't provide a timeframe for the options under study. Maxcom was seeking to complete the 2.90-pesos-a-share takeover offer, which would include an investment of $45 million to use for network improvements, to better compete with America Movil SAB (AMXL), Mexico's biggest phone company, according to Bloomberg. Maxcom said this month it may have to file for bankruptcy and may miss a June 15 coupon payment if enough debtholders didn't agree to the bond swap, which expired on April 24. The company had asked to exchange notes due in 2014 for new ones due in 2020, and Ventura had set a requirement that 80 percent of bondholders accept the swap, Bloomberg said. Ventura had the right to reduce that threshold to 75.1 percent at its discretion. Maxcom's cash had dwindled to 102.9 million pesos ($8.4 million) from 147 million pesos at the end of 2012, it said April 11. Ventura, which announced its offer for Maxcom in December, is a Mexico City-based private-equity firm led by investors including Enrique Castillo and Javier Molinar Horcasitas, former executives of bank Ixe Grupo Financiero SAB, Bloomberg related. Ixe was sold in 2011 to Grupo Financiero Banorte SAB. MISSION NEWENERGY: Serves KNM Process with Winding Up Petition -------------------------------------------------------------- Mission NewEnergy Limited's subsidiary, Mission Biofuels Sdn Bhd, has served KNM Process Systems Sdn Bhd with a winding up petition, under section 218(e)&(i) and Section 218(2)(c) of the Malaysian Companies Act 1965. MBSB seeks to wind up KNM for KNM's failure to pay MBSB approximately A$3,800,000 (MYR12.2 million) plus interest relating to Liquidated Ascertained Damages under the Engineering, Procurement, Construction and Commissioning Contract of Mission's 2nd biodiesel refinery (M2 Plant) in Malaysia. These invoices were presented to KNM over the last 2 years and despite a Letter of Demand served on KNM by MBSB's solicitors, KNM has failed to pay. The hearing of the winding up Petition will take place on July 18, 2013. About Mission NewEnergy Based in Subiaco, Western Australia, Mission NewEnergy Limited is a producer of biodiesel that integrates sustainable biodiesel feedstock cultivation, biodiesel production and wholesale biodiesel distribution focused on the government mandated markets of the United States and Europe. The Company is not operating its biodiesel refining segment. The refineries are being held in care and maintenance either awaiting a return to positive operating conditions or the sale of assets. The Company has materially diminished its Jatropha contract farming operation and the company is now focused on divesting the remaining Indian assets. The Company intends to cease all Indian operations. Grant Thornton Audit Pty Ltd, in Perth, Australia, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company incurred operating cash outflows of A$4.9 million during the year ended June 30, 2012, and, as of that date, the consolidated entity's total liabilities exceeded its total assets by A$24.4 million. The Company's consolidated balance sheet at Dec. 31, 2012, showed $7.05 million in total assets, $27.29 million in total liabilities and a $20.24 million net deficit. MOBILICITY: May File for CBCA Plan of Arrangement or CCAA --------------------------------------------------------- The Catalyst Capital Group disclosed that it is encouraged to see that the April 26 court orders maintain the parties' substantive rights. However, Catalyst is concerned that it is hard to see how the proposed plans would provide the capital required for Mobilicity to grow its business, acquire spectrum or provide viable, sustainable services to Canadian consumers. In fact, the conditions on the proposals may result in the opposite outcome. Catalyst notes the following: 1. Mobilicity put itself in position to require a CBCA Plan of Arrangement or CCAA filing as part of the mandatory terms of its February financing, potentially harming both its enterprise value and the possible recovery by creditors not participating in any new financing for the benefit of those participating and/or more junior stakeholders. 2. The old and new part of Mobilicity's financing appears to hurt second-lien holders by requiring cancellation of second- lien principal. This is a change from the February financing and reduces its adverse impact upon the first-lien debt. This cancellation is necessary if new funds are to be injected into Mobilicity as debt. 3. Catalyst is very concerned that neither the new financing nor the proposed plans will benefit creditors or result in a successful sale of Mobilicity, which, according to Mobilicity's court papers, has apparently been attempted for many months. 4. The releases contemplated by Mobilicity's plan may be inappropriate. Catalyst wishes to see Mobilicity restructured in a way that fully respects its existing stakeholder rights and interests and that leads to a successful and viable major mobile player in Canada. Catalyst intends to take an active role in the restructuring with a view to achieving that result. MONTANA ELECTRIC: Great Falls Agrees to Pay $3.25MM to Exit Coop ---------------------------------------------------------------- The Associated Press reports that city officials in Great Falls, Mont., have reached a tentative agreement to extricate the city from ties with Southern Montana Electric Generation and Transmission Cooperative. AP relates officials on Friday agreed to pay $3.25 million to the cooperative. According to AP, City Manager Greg Doyon said the agreement calls for a first payment of $2.5 million by June 30 and a final payment of $750,000 due Dec. 31. The settlement is subject to Bankruptcy Court approval. Southern Montana is composed of five rural cooperatives and the city of Great Falls that in turn provide power to more than 50,000 Montana residents. The AP notes that besides the city of Great Falls, Beartooth Electric Cooperative wants out of Southern Montana and, like Great Falls, filed a lawsuit to accomplish that as part of the bankruptcy case. About Southern Montana Electric Based in Billings, Montana, Southern Montana Electric Generation and Transmission Cooperative, Inc., was formed to serve five other electric cooperatives. The city of Great Falls later joined as the sixth member. Including the city, the co-op serves a population of 122,000. In addition to Great Falls, the service area includes suburbs of Billings, Montana. Southern Montana filed for Chapter 11 bankruptcy (Bankr. D. Mont. Case No. 11-62031) on Oct. 21, 2011. Southern Montana estimated assets of $100 million to $500 million and estimated debts of $100 million to $500 million. Timothy Gregori signed the petition as general manager. Malcolm H. Goodrich, Esq., at Goodrich Law Firm, P.C., in Billings, Montana, serves as the Debtor's counsel. After filing for reorganization in October, the co-op agreed to a request for appointment of a Chapter 11 trustee. Lee A. Freeman was appointed as the Chapter 11 trustee in December 2011. He is represented by Joseph V. Womack, Esq., at Waller & Womack, and John Cardinal Parks, Esq., Bart B. Burnett, Esq., Robert M. Horowitz, Esq., and Kevin S. Neiman, Esq., at Horowitz & Burnett, P.C. MORRELL DEVELOPING: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Morrell Developing, LLC 16 23rd Street Bristol, TN 37620 Bankruptcy Case No.: 13-50751 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court Eastern District of Tennessee (Greeneville) Judge: Marcia Phillips Parsons Debtor's Counsel: Mary Foil Russell, Esq. HALE, LYLE & RUSSELL P.O. Box 274 Bristol, TN 37621-0274 Tel: (423) 989-6555 Fax: (423) 989-6550 E-mail: mrussell@halelyle.com Scheduled Assets: $1,990,300 Scheduled Liabilities: $1,947,163 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Curtis Morrell, chief manager. MOTORS LIQUIDATION: GUC Trust and Budget Variance Reports --------------------------------------------------------- Pursuant to the Amended and Restated Motors Liquidation Company GUC Trust Agreement dated as of June 11, 2012, as amended, Wilmington Trust Company, acting solely in its capacity as trust administrator and trustee of the Motors Liquidation Company GUC Trust, is required to file certain GUC Trust Reports with the Bankruptcy Court for the Southern District of New York. In addition, pursuant to that certain Bankruptcy Court Order Authorizing the GUC Trust Administrator to Liquidate New GM Securities for the Purpose of Funding Fees, Costs and Expenses of the GUC Trust and the Avoidance Action Trust, dated March 8, 2012, the GUC Trust Administrator is required to file certain quarterly variance reports as described in the third sentence of Section 6.4 of the GUC Trust Agreement. On April 23, 2013, the GUC Trust Administrator filed the GUC Trust Report required by Section 6.2(c) of the GUC Trust Agreement together with the Budget Variance Report, each for the quarter ended March 31, 2013. In addition, the Motors Liquidation Company GUC Trust announced that no distribution in respect of its Units is anticipated for the fiscal quarter ended March 31, 2013. A copy of the Report is available for free at: http://is.gd/3ic5A4 About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. NEXSTAR BROADCASTING: New Station Buy No Impact on Moody's B2 CFR ----------------------------------------------------------------- Moody's Investors Service said that the announced plan of Nexstar Broadcasting Group, Inc. to acquire Communications Corporation of America and White Knight Broadcasting (CCA) for $270 million does not impact the B2 corporate family rating or positive outlook of Nexstar Broadcasting, Inc. Moody's estimates that the debt-funded transaction will increase Nexstar's leverage to approximately 5.5 times debt-to-EBITDA on a two year average basis from approximately 5.3 times as of yearend 2012 (two year average, pro forma for recent acquisitions and related financing). Also, the incremental debt will likely delay debt reduction and slow the trajectory to lower leverage. However, Moody's continues to believe the company could achieve sustained two year average leverage below 4.75 times debt-to-EBITDA, the trigger laid out for an upgrade, by the end of 2014. The acquisition expands the company's scale, with the addition of nineteen television stations and seven associated digital sub- channels in ten markets, seven of which are new markets. Furthermore, Moody's expects cost and revenue synergies to contribute to EBITDA growth. The transaction creates two new duopolies and adds five duopolies, supporting continued strong EBITDA margins. Moody's will evaluate the impact of any new financing on ratings for existing debt as details of the likely long term financing structure become more clear. Based in Irving, Texas, Nexstar owns, operates, programs or provides sales and other services to 72 television stations in 41 markets with annual revenue of approximately $490 million as of December 31, 2012 pro forma for recent transactions. The expected acquisition of CCA stations will expand its operation to 91 television stations in 48 markets with estimated two year average revenue of about $585 million. NORTHLAND RESOURCES: Expects to File Annual Filings on April 30 --------------------------------------------------------------- Northland Resources S.A. provided its second bi-weekly Default Status Report under National Policy 12-203 - Cease Trade Orders for Continuous Defaults ("NP 12-203"). On March 28, 2013, the Company announced that the filing of its audited financial statements and associated management discussion and analysis for the fiscal year ended December 31, 2012, would not be completed by the filing deadline set by Canadian securities laws. As a result of this delay in filing the Annual Filings and the application by the Company for a management cease trade order (a "MCTO"), the Ontario Securities Commission issued a MCTO, which imposes certain restrictions on the issuance and acquisition of securities of insiders and/or employees of the Company until the Company files the Annual Filings and related CEO and CFO certificates. The MCTO will not affect the ability of persons who are not insiders or employees of Northland to trade their securities. Pursuant to the provisions of the alternative information guidelines specified by NP 12-203, the Company reports that, since the issuance of its default announcement on March 28, 2013, except as stated in this Default Status Report, there have not been any material changes to the information contained therein; nor any failure by the Company to fulfill its intentions as stated therein with respect to satisfying the provisions of the alternative information guidelines; and there are no additional defaults or anticipated defaults subsequent to the disclosure therein, other than the delay in filing the Annual Filings and related CEO and CFO certificates. Further, there is no additional material information respecting the Company and its affairs that has not been generally disclosed. The Company expects to file the required Annual Filings and related CEO and CFO certificates on or before Tuesday, April 30, 2013. If this does not occur, the Company intends to file the third Default Status Report on or about May 9, 2013. Karl-Axel Waplan, President & CEO, Northland Resources S.A. Headquartered in Luxembourg, Northland Resources S.A. (OMX:NAURO) -- is a producer of iron ore concentrate, with a portfolio of production, development and exploration mines and projects in northern Sweden and Finland. The first construction phase of the Kaunisvaara project is complete and production ramp-up started in November 2012. The Company produces high-grade, high-quality magnetite iron concentrate in Kaunisvaara, Sweden, where the Company will exploit two magnetite iron ore deposits, Tapuli and Sahavaara. Northland has entered into off-take contracts with three partners for the entire production from the Kaunisvaara project over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study for its Hannukainen Iron Oxide Copper Gold project in Kolari, northern Finland and for the Pellivuoma deposit, which is located 15 km from the Kaunisvaara processing plant. ORCHARD BRANDS: Moody's Assigns B1 and Caa1 Ratings to New Debts ---------------------------------------------------------------- Moody's Investors Service assigned a B2 Corporate Family Rating to Orchard Brands Corporation. Moody's also assigned a B1 rating to the company's proposed $180 million first lien term loan and a Caa1 rating to its proposed $50 million second lien term loan. The rating outlook is stable. Proceeds from the proposed term loans and balance sheet cash will be used to refinance existing indebtedness and pay related fees and expenses. The assigned ratings are subject to the completion of the transaction and Moody's review of final documentation. This is a first time public rating for Orchard. The following ratings were assigned: Corporate Family Rating at B2; Probability-of-Default Rating at B2-PD; $180 million First Lien Term Loan due 2019 at B1 (LGD3, 43%). $50 million Second Lien Term Loan due 2019 at Caa1 (LGD5,80%). Ratings Rationale: Orchard's B2 Corporate Family Rating reflects the company's narrow focus on the direct-to-consumer market catering to men and women over 50 years of age, modest relative scale in the retail and apparel industry, and a high reliance on catalog mailings to drive sales. The rating also reflects the company's high leverage with pro forma debt/EBITDA (incorporating Moody's standard analytical adjustments and estimated seasonal revolver borrowing) exceeding 5.4 times on average using EBITDA for the latest twelve month period ended March 31, 2013. The company's debt and interest burden was significantly reduced upon exit from bankruptcy in April 2011. While Orchard has made significant progress in its turnaround initiatives and brand integration, EBITDA margins remain well below industry peers, and its track record remains relatively short under the current management team. The company's rating is supported by favorable demographic trends within the company's target customer age group, the breadth of its brand and product offering, and the solid growth trends in online retail spending. The company's liquidity is expected to be adequate, with positive cash flow, balance sheet cash and availability under an amended and extended $85 million ABL revolver (not rated by Moody's) expected to cover seasonal working capital needs, modest capital spending and debt amortization over the next twelve months. The stable rating outlook reflects the expectation that Orchard will steadily de-lever through debt reduction with excess free cash flow and profitable growth, and that the company will maintain adequate liquidity. Ratings could be downgraded if revenue or earnings were to deteriorate, competitive pressure increase, or financial policies become aggressive. Specific metrics include debt/EBITDA approaching 6.0 times or EBITA/interest falling below 1.25 times. A material deterioration in liquidity may also result in a negative rating action. Ratings could be upgraded if the company demonstrates profitable growth through successful implementation of initiatives, while maintaining positive free cash flow and using excess cash to pay down debt. Specific metrics include debt/EBITDA sustained near 4.5 times and EBITA/interest expense above 2.0 times. The B1 rating assigned to the company's proposed first lien term loan facility reflects the overall probability of default of the company, reflected in the B2-PD probability of default rating, and a loss given default assessment of LGD3, 43%. The facility benefits from the sizeable amount of junior claims in the proposed capital structure, including the proposed $50 million second lien term loan, as well as its first lien position on substantially all assets of the company other than accounts receivable, inventory and cash which are pledged on a first lien basis to the company's proposed ABL credit facility. The facility will be guaranteed by each of the borrower's wholly-owned restricted subsidiaries. Any increase in the proportion of first lien debt in the capital structure could lead to a downgrade in the loan's rating. The Caa1 rating on the proposed $50 million second lien term loan reflects the junior position in the capital structure and a loss given default assessment of LGD5, 80%. The principal methodology used in this rating was the Global Retail Industry Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Beverly, MA, Orchard Brands Corporation is a national retailer specializing in apparel and home products for men and women over the age of 50, with 15 brands selling through direct-to-consumer catalogs, e-commerce websites and retail stores. Annual revenue approaches $1.0 billion. ORAGENICS INC: Amends License Agreements with UFRF -------------------------------------------------- Oragenics, Inc., entered into amendments to each of its existing exclusive license agreements with University of Florida Research Foundation, Inc., for (i) the Antimicrobial Polypeptide, Nucleic Acid and Methods of Use patent and (ii) the Replacement Therapy for Dental Carries patent. As a result of the Fifth Amendments, the Company's annual payments to UFRF on the license agreements would be decreased from $100,000 to $20,000 as the Company continues its efforts with respect to the intellectual property covered by the UFRF licenses. The Fifth Amendments: identified the patents covered; lowered the amount of current annual payments the Company was required to make to UFRF from $50,000 to $10,000; and removed the requirement of the Company to spend at least $1 million annually on combined research and development. The Company's obligation to provide a development report to UFRF was revised from bi-annually to annually. In addition, the amount payable to UFRF on all revenue received from sublicensees was increased from 20 percent to 22 percent, and additional fees payable to UFRF were added as follows: a new one-time commercialization fee, post- commercialization minimum royalty payments, and a new one-time cumulative royalty payment. The one-time commercialization fee would be due on the first anniversary of first commercial sale and is calculated at $5,000 per month between May 1, 2013, and the month of the first anniversary of a commercial sale. The post- commercialization minimum royalty payments of $50,000 annually would be due following payment of a commercialization fee. The one-time additional royalty payment would be due when total cumulative royalties paid to UFRF exceed $2 million, upon which the Company would be obligated to make a one-time additional payment to UFRF of 10 percent of the total royalties due to UFRF in the calendar year in which cumulative royalties exceeded $2 million. Converts Prospectus to Form S-3 Oragenics filed with the U.S. Securities and Exchange Commission amendment no.1 to the Form S-1 registration statement to convert a the Registration Statement into a registration on Form S-3. The Registration Statement on Form S-1 was declared effective by the SEC on Sept. 26, 2012. The Registration Statement on Form S-1 related to the resale of up to 9,437,834 shares of the Company's Common Stock, par value $0.001 per share. The Common Stock was acquired by Fidelity Select Portfolios: Biotechnology Portfolio, MSD Credit Opportunity Master Fund, L.P, White Rock Capital Partners, L.P., et al., in connection with a private placement offering the Company completed in July 2012. At the time of the filing of the Registration Statement on Form S- 1 and the post-effective amendments, the Company did not meet the requirements for use of Form S-3. However, at the time of filing of this Post-Effective Amendment No. 1, the Company certifies that it has reasonable grounds to believe it meets the requirement for use of the Form S-3. The Company's Common Stock is listed on the NYSE MKT under the symbol "OGEN." On April 11, 2013, the last reported sale price of the Company's Common Stock was $2.65 per share. A copy of the Amended Prospectus is available at: http://is.gd/b3Xj1C About Oragenics Inc. Tampa, Fla.-based Oragenics, Inc. -- http://www.oragenics.com/-- is a biopharmaceutical company focused primarily on oral health products and novel antibiotics. Within oral health, Oragenics is developing its pharmaceutical product candidate, SMaRT Replacement Therapy, and also commercializing its oral probiotic product, ProBiora3. Within antibiotics, Oragenics is developing a pharmaceutical candidate, MU1140-S and intends to use its patented, novel organic chemistry platform to create additional antibiotics for therapeutic use. Oragenics incurred a net loss of $13.09 million in 2012, as compared with a net loss of $7.67 million in 2011. The Company's balance sheet at Dec. 31, 2012, showed $10.48 million in total assets, $1.25 million in total liabilities, all current, and $9.23 million in total shareholders' equity. OVERSEAS SHIPHOLDING: $94MM Military Contract Approved ------------------------------------------------------ Stewart Bishop of BankruptcyLaw360 reported that a Delaware bankruptcy judge on Wednesday said Overseas Shipholding Group Inc. can go forward with its $94 million U.S. government contract to make ships and commercial transportation resources available during times of war or national emergency. According to the report, U.S. Bankruptcy Judge Peter J. Walsh determined that letting OSG continue to take part in the U.S. Department of Transportation's Maritime Security Program "is in the best interest of the debtors, their estates and creditors and all parties in interest." About Overseas Shipholding Overseas Shipholding Group, Inc., headquartered in New York, is one of the largest publicly traded tanker companies in the world, engaged primarily in the ocean transportation of crude oil and petroleum products. OSG owns or operates 111 vessels that transport oil and petroleum products throughout the world. Overseas Shipholding Group and 180 affiliates filed voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67 billion in liabilities. Greylock Partners LLC Chief Executive John Ray serves as chief reorganization officer. Cleary Gottlieb Steen & Hamilton LLP serves as OSG's Chapter 11 counsel, while Chilmark Partners LLC serves as financial adviser. Kurtzman Carson Consultants LLC is the claims and notice agent. The Export-Import Bank of China, owed $312 million used for the construction of five tankers, is represented by Louis R. Strubeck, Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at Fulbright & Jaworski in New York; and John Knight, Esq., and Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark Partners, LLC serves as financial and restructuring advisor. Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve as co-counsel to the official committee of unsecured creditors. FTI Consulting, Inc., is the financial advisor and Houlihan Lokey Capital, Inc., is the investment banker. PACIFIC GOLD: OKs Transfer of $175,000 Notes to Third Party ----------------------------------------------------------- Pacific Gold Corp. agreed to the assignment of $175,000, in principal amount of outstanding notes, which represent notes the Company issued to the original debt holder on May 11, 2012. The assignment was to a third party that is not affiliated with the Company. In connection with the assignment, the Company agreed to various modifications of the note for the benefit of the new holder, which enhance and reset the conversion features of the note and change certain other basic terms of the note. As a result of the amendments, the note now: (i) has a conversion rate of a 45% discount to the daily VWAP price of the common stock based on a five day period prior to the date of conversion, which rate will be subject to certain adjustments; (ii) has an annual interest rate of 12%, due at maturity; (iii) has a new maturity date of Jan. 12, 2014; (iv) permits prepayment only with a premium of 50% of the amount being repaid; (v) has ratchet protection of the conversion anti-dilution provisions for all future issuances or potential issuances of securities by the company at less than the then conversion rate; and (vi) has additional default provisions, including a default penalty of 50% of outstanding principal and interest at the time of default. The Company has also agreed that the assigned debt will not be subordinate to new debt, other than purchase money and similar debt, which may have the effect of limiting the company's access to additional debt capital while the note is outstanding. The assigned portion of the principal note has a conversion rate at an approximate 45% discount to market and, without taking into account the conversion of any of the interest to be earned or converted, represents the potential issuance of 3,000,000,000 shares, limited to a maximum conversion right at any one time to 4.99% of the then outstanding shares of common stock of the company. On April 22, 2012, the Company issued $173,000 in new promissory notes a are due on Jan. 2, 2015, and pay 10% interest. The new promissory notes and the accrued interest are convertible into common stock of the Company at $0.001 per share. About Pacific Gold Las Vegas, Nev.-based Pacific Gold Corp. is engaged in the identification, acquisition, and development of prospects believed to have gold mineralization. Pacific Gold through its subsidiaries currently owns claims, property and leases in Nevada and Colorado. Pacific Gold diclosed a net loss of $16.62 million in 2012, as compared with a net loss of $1.38 million in 2011. The Company's balance sheet at Dec. 31, 2012, showed $1.45 million in total assets, $15.06 million in total liabilities and a $13.61 million total stockholders' deficit. Silberstein Ungar, PLLC, in Bingham Farms, Michigan, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has incurred losses from operations, has negative working capital and is in need of additional capital to grow its operations so that it can become profitable. These factors raise substantial doubt about the Company's ability to continue as a going concern. PARKWAY BANK: Shut Down; Certus Bank Assumes Deposits ----------------------------------------------------- Parkway Bank, Lenoir, North Carolina, was closed on April 26, 2013, by the North Carolina Office of the Commissioner of Banks, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with CertusBank, N.A., Easley, South Carolina, to assume all of the deposits of Parkway Bank. The three former branches of Parkway Bank will reopen as branches of CertusBank, N.A. during their normal business hours. Depositors of Parkway Bank will automatically become depositors of CertusBank, N.A. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Parkway Bank should continue to use their current branch until they receive notice from CertusBank, N.A., that systems conversions have been completed to allow full-service banking at all branches of CertusBank, N.A. As of December 31, 2012, Parkway Bank had approximately $108.6 million in total assets and $103.7 million in total deposits. In addition to assuming all of the deposits of the failed bank, CertusBank, N.A. agreed to purchase approximately $99.2 million of the failed bank's assets. The FDIC will retain the remaining assets for later disposition. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $18.1 million. Compared to other alternatives, CertusBank, N.A.'s acquisition was the least costly resolution for the FDIC's DIF. Parkway Bank is the ninth FDIC-insured institution to fail in the nation this year, and the first in North Carolina. The last FDIC-insured institution closed in the state was Waccamaw Bank, Whiteville, on June 8, 2012. PATRIOT COAL: Exclusive Filing Period Extended Until Sept. 2 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Missouri entered Friday a second order extending Patriot Coal Corporation, et al.'s exclusive right to file a plan of reorganization through and including Sept. 2, 2013, and the Debtors' exclusive right to obtain acceptance for that plan through and including Nov. 1, 2013. 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: Wins OK to Modify Non-Union Retiree Life Insurance ---------------------------------------------------------------- On April 26, 2013, the U.S. Bankruptcy Court for the Eastern District of Missouri approved, in part, the motion of Patriot Coal Corporation, et al., for the entry of an order authorizing, but not directing, the Debtors to modify the Non-Union Retiree Life Insurance Benefits and to terminate the Non-Union Retiree Medical Benefits. Pursuant to the Court's order, effective as of July 31, 2013, the Debtors are authorized to (i) modify the Relevant Plans that provide Non-Union Retiree Life Insurance Benefits in order to cap the maximum benefit associated with the Non-Union Retiree Life Insurance Benefits at $30,000 for the Non-Union Retirees and terminate the Non-Union Retiree Life Insurance Benefits for the current active non-union employees and (ii) terminate the Non- Union Retiree Medical Benefits, as described in the Motion; provided, however, that the Debtors will remain responsible for the payment of claims for Non-Union Retiree Benefits that are (i) incurred by Non-Union Retirees through July 31, 2013, and (ii) presented for payment no later than the last date for submitting such claims under the terms of the Relevant Plans. As soon as practicable after entry of the Court's order, the Non- Union Retiree Committee will establish a voluntary employees' beneficiary association within the meaning of Section 501(c)(9) of the U.S. Internal Revenue Code of 1986, as amended, for and on behalf of all Non-Union Retirees, with the Debtors paying up to the first $10,000 incurred by the Non-Union Retiree Committee for same but with all costs, fees and expenses of the Non-Union Retiree VEBA thereafter to be borne by the Non-Union Retiree VEBA. The Non-Union Retiree VEBA will benefit only those Non-Union Retirees that were expressly anticipated as having been subject to losing Non-Union Retiree Benefits by and through the motion. For the avoidance of doubt, the Non-Union Retiree VEBA will benefit only the Non-Union Retirees whose Non-Union Retiree Benefits are modified or terminated pursuant to the Court's order. The Non-Union Retiree Committee will be responsible for electing or appointing any trustee or trustees of the Non-Union Retiree VEBA, and the Debtors will have no obligations regarding the establishment or administration of the Non-Union Retiree VEBA. Within 10 business days of having received written notice, including the Non-Union Retiree VEBA trust documents, which documents will be reasonably acceptable to the Debtors, from the Non-Union Retiree Committee that (i) the Non-Union Retiree VEBA has been established and (ii) the Non-Union Retiree VEBA can accept contributions made as instructed in such written notice, the Debtors will cause the sum of $250,000 in cash to be contributed to the Non-Union Retiree VEBA by wire transfer as instructed in such written notice. With respect to the Non-Union Retiree VEBA, the remaining obligations of the Non Union Retiree Committee with respect to the Non-Union Retirees and the Non-Union Retiree Committee's efforts to set up and equitably administer the Non-Union Retiree VEBA, the Debtors will timely provide to the Non-Union Retiree Committee such participant and/or plan cost information relating to the Non-Union Retiree Benefits as the Non- Union Retiree Committee reasonably requests. The Debtors will further continue to allow for and pay for the reasonable use of the Debtors' claims and noticing agent, GCG, Inc., to provide a means for the Non-Union Retiree Committee to adequately communicate to the Non-Union Retirees about the Court's order and subsequent case developments, including but not limited to the manner and form in which the Non-Union Retiree VEBA will be created; provided, however, that such communications will be limited to two (2) mailings to the Non-Union Retirees. Upon the effective date of a plan of reorganization for the Debtors, the Debtors will cause shares of the equity of the reorganized Debtors that equal $3,750,000, as determined using the valuation in the Debtors' disclosure statement, or, in the Debtors' sole discretion (upon consulting with the UCC), the sum of $3,750,000 in cash, to be contributed to the Non-Union Retiree VEBA by the applicable Debtors. A complete text of the Court's order is available at: http://bankrupt.com/misc/patriotcoal.doc3849.pdf 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: Rule 2019 Motion Denied as Moot --------------------------------------------- In an order entered Friday, the U.S. Bankruptcy Court for the Eastern District of Missouri denied as moot the motion of Patriot Coal Corporation, et al., to (i) compel Aurelius Capital Management, LP, Knighthead Capital Management, LLC, and their counsel to comply with Bankruptcy Rule 2019 and (ii) prohibit further participation in the Debtors' cases by the Noteholder Group until they fully comply with Bankruptcy Rule 2019. As reported in the TCR on April 19, 2013, the Debtors told the Court that Bankruptcy Rule 2019 requires, in relevant part, certain groups and committees that consist of multiple creditors and act together to advance common interests to disclose information about their financial holdings in the Debtors, and that entities that represent such groups or committees (e.g., law firms) must also comply with Bankruptcy Rule 2019. Patriot said: "Unless the members of the Noteholder Group are all affiliates or insiders of one another, and, upon information and belief, they are not, the Noteholder Group is clearly a "group" that is covered by Bankruptcy Rule 2019 and required to file a verified statement. Accordingly, both the Noteholder Group and its counsel must disclose the information required under the applicable provisions in subsection (c) of Bankruptcy Rule 2019 and must do so in a verified statement filed with the Court." 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. PENSON WORLDWIDE: Files Projected Cash Projections and Allocations ------------------------------------------------------------------ Penson Worldwide, Inc. and its affiliated debtors notified the bankruptcy court on April 25, 2013, that subsequent to the filing of their Second Amended Joint Plan and Amended Disclosure Statement, they provided their projected cash positions and allocations as of the Plan Effective Date, to the Official Committee of Unsecured Creditors and holders of the 12.50% Senior Second Lien Notes due 2017, to assist with negotiations to resolve certain open issues with the Plan raised by the Committee. The issues being addressed by the Committee and the Second Lien Noteholders with respect to the Plan include: * The Committee has asserted that Penson Financial Services Inc. has a security interest in the so-called Illiquid Instruments held by SAI Holdings in connection with the secured promissory note dated May 15, 2013, between SAI as the borrower, and PFSI as the lender, in the principal amount of $5,500,000. The Debtors, the Committee and the Second Lien Noteholders have been in discussions regarding a proposed sharing of any proceeds from the Illiquid Instruments between PFSI and SAI estates. * The Committee has asserted that the location of certain assets within the Debtors' capital structure give rise to potential conflicts of interest to the members of the PTL Board of Managers as defined in the Plan. To resolve these potential conflicts, the Debtors, the Committee and the Second Lien Noteholders have been in discussions regarding (i) allowing the Committee to appoint one member of the PTL Board of Managers, (ii) to the extent possible, allocating assets among the various Debtor estates prior to confirmation to minimize conflicts, and (iii) providing a mechanism to address potential conflicts that may arise post confirmation. * The Committee has asserted that, to the extent a Debtor's estate is solvent, creditors of the estate are entitled to post-petition interest on their claims. The Debtors, the Committee and the Second Lien Noteholders have been in discussions regarding whether post-petition interest is appropriate and, if so, the appropriate interest rate on such claims; and * The Committee has asserted that the Cash Projections may not provide for a proper allocation of post-petition professional fees and other administrative expenses and has recommended an alternative allocation among the Debtors' estates that it believes more fairly allocates costs for both the post-petition and post-effective date periods. The Debtors, the Committee and Second Lien Noteholders have been in discussions regarding this proposed alternative professional fee and administrative expense allocation. Nexa (in millions) Cash as of 3/31/13 $0.1 + Asset sale proceeds 10.5 + A/R 2.5 - A/P (Postpetition) (2.6) - Professional Fees (1.7) - Cure Costs (0.5) - Loan to PWI (2.8) - Loan to PFSI (1.7) ------- Ending Cash Available for Claims $3.8 ======= PFSI (in millions) Cash as of 3/31/13 $1.9 + DTCC Share Sale 1.2 - A/P and Operating Costs (Postpetition) (1.6) - Professional Fees (1.7) - Post Confirmation Expenses (1.5) + Loan From Nexa 1.7 ------- Ending Cash May 31st $1.5 ======= PWI (in millions) Cash as of 3/31/13 $0.0 - Professional Fees (0.7) - D&O Insurance* (2.1) + Loan From Nexa 2.8 ------- Ending Cash May 31st $0.0 ======= * This is the amount the Debtors have been quoted for the purchase of a 3-year tail of the Debtors' existing D&O policies. The Debtors have been in discussions with the Committee and the Second Lien Noteholders regarding whether this tail is necessary. About Penson Worldwide Plano, Texas-based Penson Worldwide Inc. and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10061) on Jan. 11, 2013. Founded in 1995, Penson Worldwide is provider of a range of critical securities and futures processing infrastructure products and services to the global financial services industry. The company's products and services include securities and futures clearing and execution, financing and cash management technology and other related offerings, and it provides tools and services to support trading in multiple markets, asset classes and currencies. Penson was one of the top two clearing brokers overall in the United States. Its foreign-based subsidiaries were some of the largest independent clearing brokers in Canada and Australia and the second largest independent clearing broker in the United Kingdom as of Dec. 31, 2010. In 2012, the company sold its futures division to Knight Capital Group Inc. and its broker-deal subsidiary to Apex Clearing Corp. But the company was unable to successfully streamline is business after the asset sales. Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Young, Conaway, Stargatt & Taylor serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. The U.S. Trustee for Region 3 appointed three members to the Official Committee of Unsecured Creditors: (i) Schonfeld Group Holdings LLC; (ii) SunGard Financial Systems LLC; and (iii) Wells Fargo Bank, N.A., as Indenture Trustee. The Committee selected Hahn & Hessen LLP and Cousins Chipman & Brown, LLP to serve as its co-counsel, and Capstone Advisory Group, LLC, as its financial advisor. Kurtzman Carson Consultants LLC serves as its information agent. The company estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. The last publicly filed financial statements as of June 30 showed assets of $1.17 billion and liabilities totaling $1.227 billion. PENSON WORLDWIDE: NDV Wants Stay Lifted to Pursue Arbitration ------------------------------------------------------------- NDV Investment Company, JM Property SP Z.O.O. SP K, and Jerzy Mendelka filed a motion seeking to compel arbitration, including relief from the automatic stay, so they may commence and prosecute arbitration before the Financial Industry Regulatory Authority to liquidate their claims against Pension Financial Services, Inc., Pension Worldwide, Inc. and SAI Holdings, Inc., as holding/parent companies of Pension Financial Services, Inc. (the Arbitration Debtors). In the alternative, the Claimants ask the Court to exercise its discretion and permissively abstain so the FINRA Arbitration may commence and the Claimants may prosecute their Claims against the Arbitration Debtors. Without knowledge of the filing of the Chapter 11 cases, the Claimants commenced the FINRA Arbitration by filing a statement of claim against the Arbitration Debtors on January 30, 2013. While the claimants acknowledge that the FINRA Arbitration against the Arbitration Debtors is void ab initio, the FINRA Arbitration against the arbitration respondents is not stayed and is proceeding. To preserve the confidentiality of the FINRA Arbitration, in accordance with FINRA guidelines, the Claimants are seeking to file their Motion under the seal. Copies of the Motion are being provided without redaction to counsel to the Debtors, the Claimants tell the Court. Moreover, upon written request of a party in interest for the Motion, the Claimants will coordinate with the Debtors, and if necessary, FINRA, regarding whether the Motion may be sent to a third party, and if so, under what terms. The Claimants also ask the Court to enter an order shortening the required notice period with respect to its Motion, so that this may be heard at the next scheduled Omnibus hearing date, May 7, 2013, and for the Court to limit notice. About Penson Worldwide Plano, Texas-based Penson Worldwide Inc. and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10061) on Jan. 11, 2013. Founded in 1995, Penson Worldwide is provider of a range of critical securities and futures processing infrastructure products and services to the global financial services industry. The company's products and services include securities and futures clearing and execution, financing and cash management technology and other related offerings, and it provides tools and services to support trading in multiple markets, asset classes and currencies. Penson was one of the top two clearing brokers overall in the United States. Its foreign-based subsidiaries were some of the largest independent clearing brokers in Canada and Australia and the second largest independent clearing broker in the United Kingdom as of Dec. 31, 2010. In 2012, the company sold its futures division to Knight Capital Group Inc. and its broker-deal subsidiary to Apex Clearing Corp. But the company was unable to successfully streamline is business after the asset sales. Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Young, Conaway, Stargatt & Taylor serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. The U.S. Trustee for Region 3 appointed three members to the Official Committee of Unsecured Creditors: (i) Schonfeld Group Holdings LLC; (ii) SunGard Financial Systems LLC; and (iii) Wells Fargo Bank, N.A., as Indenture Trustee. The Committee selected Hahn & Hessen LLP and Cousins Chipman & Brown, LLP to serve as its co-counsel, and Capstone Advisory Group, LLC, as its financial advisor. Kurtzman Carson Consultants LLC serves as its information agent. The company estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. The last publicly filed financial statements as of June 30 showed assets of $1.17 billion and liabilities totaling $1.227 billion. PHIL'S CAKE: Hearing on Cash Access Continued Until May 23 ---------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida early this month continued until May 23, 2013, at 1:30 p.m., the hearing on Phil's Cake Box Bakeries, Inc.'s motion for authority to use cash collateral. About Phil's Cake 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. No trustee or examiner nor an official committee have yet been appointed in the case. PHIL'S CAKE: Taps Gregory Sharer as Certified Public Accountant --------------------------------------------------------------- Phil's Cake Box Bakeries, Inc., last month sought permission from the U.S. Bankruptcy Court for the Middle District of Florida to employ Gregory, Sharer & Stuart, P.A. as certified public accountant. The fees for the services will be based upon the amount of time required at Gregory Sharer standard billing rates for the personnel working on the engagement, plus out of pocket expenses. The firm estimates its fees for the services will be $4,500. Daniel J. Hevia, accountant at Gregory Sharer, tells the Court that the firm previously performed accounting services for the Debtor including preparation of tax returns. The firm holds a general unsecured claim in the amount of $18,627. To the best of the Debtor's knowledge, Gregory Sharer 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. No trustee or examiner nor an official committee have yet been appointed in the case. PICACHO HILLS: William F. Davis Approved as Bankruptcy Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of New Mexico early this month authorized Picacho Hills Utility Company, Inc., to employ William F. Davis & Associates, P.C., as attorneys to represent the Debtor in the bankruptcy case. The Debtor will pay the firm's attorneys at the hourly rate of: $300 for William F. Davis, Esq., $250 for Anne D. Goodman, Esq., $200 for Andrea D. Steiling, Esq., $200 for Vashti A. Lowe, Esq., $175 for Nephi D. Hardman, Esq., $95 for senior paralegal time, plus costs, expenses and applicable taxes. About Picacho Hills Utility Picacho Hills Utility Company, Inc., filed a Chapter 11 petition (Bankr. D. N.M. Case No. 13-10742) on March 7, 2013. The Debtor is represented by William F. Davis & Associates, P.C. The Debtor estimated assets of at least $10 million and debts of at least $1 million. PHUC is a public utility as defined by the New Mexico Public Utility Act, Sec. 62-3-3.G. and provides water and sewer service to approximately one thousand residences in Dona Ana County, New Mexico. PHUC is 100% owned by Stephen C. Blanco, who is its president. PM CROSS: Chapter 11 Case Summary & 2 Unsecured Creditors --------------------------------------------------------- Debtor: PM Cross, LLC P.O. Box 6511 Manchester, NH 03108 Bankruptcy Case No.: 13-11075 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court District of New Hampshire Live Database (Manchester) Debtor's Counsel: Peter N. Tamposi, Esq. THE TAMPOSI LAW GROUP 159 Main Street Nashua, NH 03060 Tel: (603) 204-5513 E-mail: peter@thetamposilawgroup.com Scheduled Assets: $1,117,637 Scheduled Liabilities: $1,158,267 A copy of the Company's list of its two largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/nhb13-11075.pdf The petition was signed by David McCurdy, manager. POSITIVEID CORP: Effects a 1-for-25 Reverse Stock Split ------------------------------------------------------- PositiveID Corporation's Board of Directors has approved a reverse split of its common stock at a ratio of 1-for-25 commencing at the open of trading on April 23, 2013. The Company's ticker symbol will be PSIDD for approximately 20 trading days after the split to designate that it is trading on a post-reverse split basis. As a result of the reverse stock split, the number of outstanding common shares will be reduced to approximately 15 million shares. No fractional shares will be issued as a result of the reverse stock split, and stockholders who otherwise would be entitled to a fractional share will receive, in lieu thereof, a cash payment based on the volume weighted average price of the Company's common stock as reported on April 22, 2013, on the Over the Counter Bulletin Board Market. The Company's transfer agent will provide instructions to stockholders regarding the process for exchanging shares. The Company's stockholders approved the reverse split of the Company's common stock at the annual meeting held on April 18, 2013. Over the past two years, the Company has focused on its patented molecular diagnostic technologies for bio-threat detection and rapid medical testing. The Company believes this reverse stock split could enhance the appeal of its common stock to the financial community, including institutional investors, potential new strategic partners and the general investing public as it continues to execute its business strategy. Recent significant developments related to the Company's molecular diagnostic technologies include: * In December, the Company entered into a license agreement and a teaming agreement, including a license fee to the Company of $2.5 million, with a large strategic partner providing them the right to sell the Company's M-BAND (Microfluidics- based Bioagent Networked Detector) airborne bio-threat detector for the U.S. Department of Homeland Security's ("DHS") BioWatch Generation 3 opportunity, as well as other opportunities in the North American market. PositiveID retained exclusive rights to serve as the reagent and assay supplier of M-BAND systems to its partner in the U.S. market, and also retained the right to sell M-BAND units, reagents and assays in international markets. * DHS released a draft request for proposal for Stage 1 of BioWatch Generation 3, an autonomous biodetection system designed to protect the nation against biological threats. The final RFP for Stage 1 of BioWatch Generation 3 is expected to be released in the government's third quarter of fiscal 2013, which ends June 30th. The Stage 1 contract is expected to have a performance period of 18 months. The full roll-out of BioWatch Generation 3 is estimated at $3.1 billion over the next five years. * The Company also signed a teaming agreement with a large government contractor to pursue the Defense Threat Reduction Agency Indefinite Delivery/Indefinite Quantity Multiple Award Contracts supporting the Weapons of Mass Destruction - Defeat Technology, Arms Control, and Nuclear Technology Electromagnetic Research and Development/Survivability and Infrastructure programs. The Company will offer both its DragonflyTM Rapid MDx Cartridge-based diagnostic system and its M-BAND system as part of the teaming agreement. William J. Caragol, Chairman and CEO of PositiveID, stated, "As we continue to implement our strategic plan to focus on our patented and patent pending technologies to participate in the estimated $3.1 billion BioWatch Generation 3 opportunity and complete the development of our innovative biological detection and diagnostics applications, we believe increasing our price per share and decreasing the number of common shares outstanding may make us more attractive to new potential strategic partners and investors." In March, the Company published a report on market opportunities and positioning for its M-BAND and Dragonfly technologies. A copy of the report is available on the Company's Web site at http://www.positiveidcorp.com/files/M- BAND_and_Dragonfly_Market_Opportunities_Report_2013-03-07.pdf. Meanwhile, on April 22, 2013, the Company entered into a Letter Agreement with VeriTeQ Acquisition Corporation. The purpose of this agreement is to: (1) define the level of financial support of VeriTeQ over the months of April and May, 2013 under its existing shared services agreement, (2) the terms under which VeriTeQ will make repayments to the Company under the shared services agreement and note owed by VeriTeQ to the Company, and (3) a correction to one of the schedules to the Asset Purchase Agreement dated Aug. 28, 2012. About PositiveID Delray Beach, Fla.-based PositiveID Corporation has historically developed, marketed and sold RFID systems used for the identification of people in the healthcare market. Beginning in early 2011, the Company has focused its strategy on the growth of its HealthID business, including the continued development of its GlucoChip, its Easy Check breath glucose detection device, its iglucose wireless communication system, and potential strategic acquisition opportunities of businesses that are complementary to its HealthID business. PositiveID incurred a net loss of $7.99 million on $0 of revenue for the year ended Dec. 31, 2012, as compared with a net loss of $16.48 million on $0 of revenue for the year ended Dec. 31, 2011. The Company's balance sheet at Dec. 31, 2012, showed $2.41 million in total assets, $6.17 million in total liabilities and a $3.76 million total stockholders' deficit. EisnerAmper LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that at Dec. 31, 2012, the Company has a working capital deficiency and an accumulated deficit. Additionally, the Company has incurred operating losses since its inception and expects operating losses to continue during 2013. These conditions raise substantial doubt about its ability to continue as a going concern. R. BARKLEY: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: R. Barkley Enterprises Inc. P.O. Box 1034 Albertville, AL 35950-0017 Bankruptcy Case No.: 13-40789 Chapter 11 Petition Date: April 23, 2013 Court: U.S. Bankruptcy Court Northern District of Alabama (Anniston) Debtor's Counsel: Tameria S. Driskill, Esq. TAMERIA S. DRISKILL, LLC P.O. Box 8505 Gadsden, AL 35902 Tel: (256) 546-5591 Fax: (256) 546-6557 E-mail: tamerialaw@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by James Richard Barkley, president. RADIOSHACK CORP: Widens Net Loss to $43.3 Million in Q1 ------------------------------------------------------- Radioshack Corp filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $43.3 million on $849 million of net sales and operating revenues for the three months ended March 31, 2013, as compared with a net loss of $8 million on $913.3 million of net sales and operating revenues for the same period during the prior year. The Company's balance sheet at March 31, 2013, showed $2.02 billion in total assets, $1.46 billion in total liabilities and $561.4 million in total stockholders' equity. The company ended the first quarter with total liquidity of $820 million, including cash and cash equivalents of $435 million and $385 million of available credit under the $450 million asset- based revolving credit facility that expires in January 2016. Joseph C. Magnacca, chief executive officer, said, "In the few weeks that I have been with the company, I have distilled several key learnings that have led me to focus on an initial set of priorities to begin driving our turnaround: building the right management team, reinvigorating the store experience, and jumpstarting our powerful brand. While I inherited an experienced management team, there were a couple of important roles to fill. Last week, we announced the hiring of a new chief marketing officer and a new senior vice president of store concepts." A copy of the Form 10-Q is available for free at: http://is.gd/vtoImk About Radioshack RadioShack sells consumer electronics and peripherals, including cellular phones. It operates roughly 4,700 stores in the U.S. and Mexico. It also operates about 1,500 wireless phone kiosks in Target stores. The company also generates sales through a network of 1,100 dealer outlets worldwide. Revenues for the last 12 months' period ending June 30, 2012, were roughly $4.4 billion. Radioshack disclosed a net loss of $139.4 million in 2012, as compared with net income of $72.2 million in 2011. * * * As reported by the TCR on Nov. 23, 2012, Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured debt ratings on Fort Worth, Texas-based RadioShack Corp. to 'CCC+' from 'B-'. The outlook is negative. "The downgrade of RadioShack reflects our view that it will be very difficult for the company to improve its gross margin in the fourth quarter of this year, given the highly promotional nature of year-end holiday retailing in the wireless and consumer electronic categories," said Standard & Poor's credit analyst Jayne Ross. In the July 27, 2012, edition of the TCR, Fitch Ratings has downgraded its long-term Issuer Default Rating (IDR) for RadioShack Corporation to 'CCC' from 'B-'. The downgrade reflects the significant decline in RadioShack's profitability, which has become progressively more pronounced over the past four quarters. REVSTONE INDUSTRIES: Boston Finance Has Right to Credit Bid ----------------------------------------------------------- The Bankruptcy Court last month granted Boston Finance Group, LLC's motion (i) modifying the automatic stay to allow BFG to exercise its rights under applicable state laws to dispose of its collateral, including, without limitation, the right to credit bid to acquire title to the collateral; and (ii) for adequate protection in the Chapter 11 cases of Revstone Industries, LLC, et al. BFG is willing to credit bid for the collateral and has agreed that for the purposes of its claims against US Tool & Engineering, LLC and Revstone Industries, LLC, as the guarantor of US Tool's obligations to BFG, that it will reduce any claims that it files or that are scheduled in favor of BFG in the US Tool Chapter 11 case and Revstone Chapter 11 case by the amount of $675,000. The Court ordered that any objections to the adequate protection motion and the sale motion that are inconsistent with the relief granted in the order are overruled. About Revstone Industries, Greenwood Forgings, & US Tool & Engineering Lexington, Kentucky-based Revstone Industries LLC, a maker of truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon oversees the case. In its petition, Revstone estimated under $50 million in assets and debts. Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del. Case No. 12-13263) on Dec. 3, 2012. Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No. 13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No. 13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013. Judge Shannon also oversees the cases. Greenwood Forgings, LLC disclosed $17,810,867 in assets and $11,366,138 in liabilities as of the Chapter 11 filing. US Tool & Engineering, LLC disclosed $1,071,250 in assets and $10,363,938 in liabilities as of the Chapter 11 filing. A motion for joint administration of the cases has been filed. Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy counsels to Greenwood and US Tool. Pachulski Stang Ziehl & Jones LLP also serves as counsel. Rust Consulting/Omni Bankruptcy will provide certain administrative services; and will serve as noticing and claims agent. Huron Consulting Services LLC will provide a chief restructuring officer and additional personnel for the Debtor. The petitions were signed by George S. Homeister, chairman. RITE AID: Swings to $118.1 Million Net Income in Fiscal 2013 ------------------------------------------------------------ Rite Aid Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing net income of $118.10 million on $25.39 billion of revenue for the year ended March 2, 2013, as compared with a net loss of $368.57 million on $26.12 billion of revenue for the year ended March 2, 2012. The Company's balance sheet at March 2, 2013, showed $7.07 billion in total assets, $9.53 billion in total liabilities and a $2.45 billion total stockholders' deficit. A copy of the Form 10-K is available for free at: http://is.gd/jDJAMp About Rite Aid Corp. Drugstore chain Rite Aid Corporation (NYSE: RAD) -- http://www.riteaid.com/-- based in Camp Hill, Pennsylvania, is one of the nation's leading drugstore chains with 4,626 stores in 31 states and the District of Columbia. * * * As reported by the TCR on March 1, 2013, Moody's Investors Service upgraded Rite Aid Corporation's Corporate Family Rating to B3 from Caa1 and Probability of Default Rating to B3-PD from Caa1-PD. At the same time, the Speculative Grade Liquidity rating was revised to SGL-2 from SGL-3. This rating action concludes the review for upgrade initiated on Feb. 4, 2013. Rite Aid carries a 'B-' corporate credit rating from Standard & Poor's Ratings Services. RIVER ROAD: $19-Mil. Claim Cut to $52K in Settlement ---------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that the final substantial claims dispute in River Road Hotel Partners LLC's Chapter 11 plan was settled Wednesday, as a $19 million initial claim was dramatically slashed down to $52,500, clearing the way for the liquidating hotel developer to start paying its creditors. According to the report, the agreement with EREF Mezzanine LLC was filed in the U.S. Bankruptcy Court for the Northern District of Illinois, and comes nearly 18 months after the Chapter 11 plan was approved by the court in late 2011. About River Road Hotel & RadLAX Gateway Hotel River Road Hotel Partners, LLC, developed and manages the InterContinental Hotel Chicago O'Hare located in Rosemont, Illinois. Affiliate RadLAX Gateway Hotel LLC owns the Radisson hotel at Los Angeles International Airport. Both were controlled owned by Harp Group. River Road and its affiliates filed Chapter 11 in Chicago (Bankr. N.D. Ill. Lead Case No. 09-30029) on Aug. 17, 2009. Based in Oak Brook, Illinois, River Road estimated assets of as much as $100 million and debt of as much as $500 million in its Chapter 11 petition. River Road disclosed $0 in assets and $14,400,000 in liabilities as of the Chapter 11 filing. RadLAX and its affiliates filed a separate chapter 11 petition (Bankr. N.D. Ill. Case No 09-30047) also on the same date, estimating assets at $50 million to $100 million. David M. Neff, Esq., at Perkins Coie LLP, serves as counsel to the River Road and RadLAX debtors. The two cases, however, are not jointly administered. The Official Committee of Unsecured Creditors is represented by Stephen T. Bobo and Ann E. Pille at Reed Smith LLP. Adam A. Lewis, Esq., and Norman S. Rosenbaum, Esq., of Morrison Foerster LLP of San Francisco, California; and John W. Costello, Esq., and Mary E. Olson, Esq., of Wildman, Harrold, Allen & Dixon LLP of Chicago, Illinois, represented Amalgamated Bank. John Sieger, Esq., and Andrew L. Wool, Esq., of Katten Muchin Rosenman LLP represented U.S. Bank. The bankruptcy judge in Chicago on July 7, 2011, signed a confirmation order for the Chapter 11 plan for River Road. The plan, which was proposed by River Road's lender, Amalgamated Bank, will give ownership in exchange for $162 million in debt. The lender waived its deficiency claim on taking title through the plan. The plan was declared effective Nov. 23, 2011. RadLAX's case was dismissed in Sept. 2012. SALON MEDIA: Stockholders OK Hike of Authorized Stock to $150MM --------------------------------------------------------------- Salon Media Group, Inc.'s stockholders approved an increase in authorized shares of common stock of the Company from 30 million to 150 million. The Company filed a Certificate of Amendment to its Restated Certificate of Incorporation with the Delaware Secretary of State to effect the amendment. After the Certificate of Amendment was filed, the remaining common stock of approximately 46.58 million shares that were issuable in the Recapitalization were issued. After (i) issuing the remaining 46.58 million shares of common stock in the Recapitalization, and (ii) reserving (A) 1,096,676 shares of common stock for issuance upon exercise of the remaining 1,075 shares of Series C Preferred Stock, (B) 3,532,242 shares of common stock for issuance upon exercise of outstanding options, and (C) 2,596,461 shares of common stock for issuance in respect of authorized but unissued options, the Company has 66,616,679 shares of common stock available for future issuance for other purposes, including financings. About Salon Media San Francisco, Calif.-based Salon Media Group (OTC BB: SLNM.OB) -- http://www.Salon.com/-- is an online news and social networking company and an Internet publishing pioneer. The Company reported a net loss of $4.09 million for the year ended March 31, 2012, a net loss of $2.58 million for fiscal 2011, and a net loss of $4.86 million for fiscal year 2010. The Company's balance sheet at Dec. 31, 2012, showed $1.39 million in total assets, $17.03 million in total liabilities and a $15.64 million total stockholders' deficit. Burr Pilger Mayer, Inc., in San Francisco, California, issued a "going concern" qualification on the consolidated financial statements for the fiscal year ended March 31, 2012. The independent auditors noted that the Company has suffered recurring losses and negative cash flows from operations and has an accumulated deficit of $112.5 million at March 31, 2012, which raise substantial doubt about the Company's ability to continue as a going concern. SAN BERNARDINO, CA: Projects $2.3MM Cash Surplus ------------------------------------------------ James F. Penman, the city attorney of San Bernardino, California, wrote in the San Bernardino Sun's "Point of View" column that the city is making progress against bankruptcy. According to Mr. Penman, the city council on April 22 adopted a final budget, which projects San Bernardino ending the current fiscal year with a cash balance of $7.7 million. This means a $2.3 million cash surplus. "If our office's calculations are correct, this budget may be off by approximately $2 million. However, that still leaves a surplus of $300,000; a substantial improvement over the $41 million deficit projected previously," Mr. Penman wrote. "While we are not out of the woods, and difficulties lie ahead, I can report to you that it is now unlikely the city will dissolve. The city is no longer in critical danger of being unable to make payroll and your employees continue to report for work." According to Mr. Penman, the city continues to talk with creditors and "often reach agreements with them." "Slowly, we have succeeded in reaching consensus with most creditors that this city does need the protection of the federal bankruptcy laws," he said. A copy of Mr. Penman's article is available at http://is.gd/pEhLFX from SBSun.com. About San Bernardino, Calif. San Bernardino, California, filed an emergency petition for municipal bankruptcy under Chapter 9 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 12-28006) on Aug. 1, 2012. San Bernardino, a city of about 210,000 residents roughly 65 miles (104 km) east of Los Angeles, estimated assets and debts of more than $1 billion in the bare-bones bankruptcy petition. The city council voted on July 10, 2012, to file for bankruptcy. The move lets San Bernardino bypass state-required mediation with creditors and proceed directly to U.S. Bankruptcy Court. The city is represented that Paul R. Glassman, Esq., at Stradling Yocca Carlson & Rauth. San Bernardino joined two other California cities in bankruptcy: Stockton, an agricultural center of 292,000 east of San Francisco, and Mammoth Lakes, a mountain resort town of 8,200 south of Yosemite National Park. SAN DIEGO HOSPICE: April 30 Hearing on Motion to Appoint Trustee ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of California will convene a hearing on April 30, 2013, at 10 a.m., to consider a motion by unsecured creditors for appointment of a Chapter 11 trustee for San Diego Hospice & Palliative Care Corporation. The Official Committee of Unsecured Creditors seeks the immediate appointment of a Chapter 11 trustee based on the Debtor's (a) dissipation of millions of dollars of assets in derogation of its fiduciary duty to creditors; (b) alleged prepetition fraud against the Medicare Program; (c) abdication of its fiduciary duty to creditors leading to an inability of the creditors to have confidence in the existing management to fulfill their fiduciary duties with regard to the remaining assets of the estate; (d) failure to adhere to the requirements of the Bankruptcy Code postpetition; (e) conflict of interest inherent in the dual role of the Debtor's management with regard to the Debtor and the San Diego Hospice Foundation, Inc.; and (f) other just cause. The Committee is represented by: Samuel R. Maizel, Esq. Teddy M. Kapur, Esq. Jeffrey L. Kandel, Esq. PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Blvd., 13th Floor Los Angeles, CA 90067 Tel: (310) 277-6910 Fax: (310) 201-0760 E-mail: smaizel@pszjlaw.com tkapur@pszjlaw.com jkandel@pszjlaw.com About San Diego Hospice San Diego Hospice & Palliative Care Corporation filed a Chapter 11 petition (Bankr. S.D. Calif. Case No. 13-01179) in San Diego on Feb. 4, 2013. The Debtor is the operator of the San Diego Hospice and The Institute for Palliative Medicine, one of the largest community-owned, not-for-profit hospices in the country. The Debtor scheduled $20,369,007 in total assets and $14,888,058 in total liabilities. Even before the bankruptcy filing, the Debtor has been under a federal investigation, focusing whether it allowed patients to stay in the program even when their diagnosis changed. The Debtor said that it will meet with government agencies to address their concerns, explore partnerships with other health care organizations, and work to restructure and resize San Diego Hospice. The Debtor said it has encouraged Scripps Health, the region's largest provider of health care services, to enter the hospice business. Procopio, Cory, Hargreaves & Savitch LLP serves as counsel to the Debtor. The Debtor will sell its unused 24-bed hospice facility for $10.7 million to Scripps Health unless a better bid turns up at an April 30 auction. SAN DIEGO HOSPICE: Squar Milner Approved as Accountants ------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of California authorized San Diego Hospice & Palliative Care Corporation to employ Squar, Milner, Peterson, Miranda & Williamson, LLP as accountants and consultants. As reported in the Troubled Company Reporter on April 2, 2013, the firm has a combined operating experience exceeding 75 years (Squar Milner since 1981 and Peterson & Co. since 1951). The firm is expected to provide various services to the Debtor, including: a. analysis and consulting services regarding the Debtor's pre- and postpetition finances and accounting; b. assistance with document discovery and document production efforts and identification of critical documents and records; and c. assistance with preparation of the Debtor's bankruptcy schedule, statement of financial affairs and other bankruptcy-related schedules and documents. The firm does not have a prepetition claim against the Debtor. The Debtor paid all of the firm's invoices in full for the period from Jan. 8, 2013 through Feb. 4, 2013: 1. On Jan. 25, 2013, the firm was paid a retainer in the amount of $10,000 which was subsequently applied to its prepetition invoice for services rendered through Jan. 27, 2013. 2. On Feb. 1, 2013, the firm was paid $12,928 representing payment in full of the remaining unpaid balance of $2,928 on its Jan. 27, 2013 invoice, as well as an additional retainer of $10,000 for further services. This second retainer payment was subsequently applied to an invoice billing for services rendered from Jan. 28, 2013 through and including the petition date of Feb. 4, 2013 in the amount of $4,065. 3. The remaining balance of $5,935 represents a retainer for its postpetition services which will be applied against the firm's postpetition fees and expenses as allowed by the Court. The firm's William H. Parker and Stacy Elledge Chiang attest that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About San Diego Hospice San Diego Hospice & Palliative Care Corporation filed a Chapter 11 petition (Bankr. S.D. Calif. Case No. 13-01179) in San Diego on Feb. 4, 2013. The Debtor is the operator of the San Diego Hospice and The Institute for Palliative Medicine, one of the largest community-owned, not-for-profit hospices in the country. The Debtor scheduled $20,369,007 in total assets and $14,888,058 in total liabilities. Even before the bankruptcy filing, the Debtor has been under a federal investigation, focusing whether it allowed patients to stay in the program even when their diagnosis changed. The Debtor said that it will meet with government agencies to address their concerns, explore partnerships with other health care organizations, and work to restructure and resize San Diego Hospice. The Debtor said it has encouraged Scripps Health, the region's largest provider of health care services, to enter the hospice business. Procopio, Cory, Hargreaves & Savitch LLP serves as counsel to the Debtor. The Debtor will sell its unused 24-bed hospice facility for $10.7 million to Scripps Health unless a better bid turns up at an April 30 auction. SAN JOSE, CA: Council Finds It Cannot Afford to Quit CalPERS ------------------------------------------------------------ Tim Reid, writing for Reuters, reported that the City Council of San Jose, in the heart of California's Silicon Valley, wants to quit the state's public pension fund -- which covers its current and former members -- because it fears it can't afford the rising contributions. There's just one problem, the Reuters report said. It also can't afford the "astonishingly high" termination fee of up to $5.7 million that the California Public Employees Retirement System is demanding. The catch-22 situation comes at a time when cities and states are struggling to manage budgets because of soaring pension costs, the Reuters report noted. According to Reuters, the San Jose City Council voted unanimously in January 2012 to explore terminating its relationship with Calpers, America's biggest pension system with $256 billion in assets. It asked for a termination figure for the 30 current and former council members subscribed to the plan. In January 2013, Calpers pegged the cost at between $5 million and $5.7 million, a figure just made public. "I was astonished," Mayor Chuck Reed told Reuters. "It was a shock." One year ago, he said, the city council's unfunded liability figure estimated by Calpers was about $500,000. "I was expecting at most two or three times that as a termination figure," Reed said. He said the quit fee was so high that the city, America's 10th biggest with a population of nearly 1 million, had little option but to keep paying into Calpers for the current and former council members, the Reuters report related. Newly elected members are already offered a different pension plan with lower costs and benefits, and will not pay into Calpers, Reed said. The city's general workforce pays into different pension funds not managed by Calpers. Brad Pacheco, a Calpers spokesman, told Reuters that when a termination fee is paid, cities get fully funded and guaranteed lifetime pension payments for all members in the plan. SCHOOL SPECIALTY: Committee Drops Motion to Terminate Exclusivity ----------------------------------------------------------------- BankruptcyData reported that School Specialty's official committee of unsecured creditors withdrew from the U.S. Bankruptcy Court its motion to terminate the Debtors exclusive period the Company can file a Chapter 11 Plan and solicit acceptances thereof. According to the report, no explanation for the withdrawal was provided. Separately, the Court approved School Specialty's Disclosure Statement for its Amended Joint Chapter 11 Plan and scheduled a May 20, 2013 confirmation hearing, the report added. 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% 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. The petition estimated assets of $494.5 million and debt of $394.6 million. The Debtors are represented by lawyers at Paul, Weiss, Rifkind, Wharton & Garrison LLP and Young, Conaway, Stargatt & Taylor, LLP. 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 ABL Lenders are represented by lawyers at Goldberg Kohn and Richards, Layton and Finger, P.A. The Ad Hoc DIP Lenders led by U.S. Bank are represented by lawyers at Stroock & Stroock & Lavan LLP, and Duane Morris LLP. The lending consortium consists of some of the holders of School Specialty Inc.'s 3.75% Convertible Subordinated Notes Due 2026. The Official Committee of Unsecured Creditors appointed in the case is represented by lawyers at Brown Rudnick LLP and Venable LLP. Bayside is represented by Pepper Hamilton LLP and Akin Gump Strauss Hauer & Feld LLP. School Specialty in April 2013 decided to reorganize rather than sell. The company filed a so-called dual track plan that called for selling the business at auction on May 8 or reorganizing while giving stock to lenders and unsecured creditors. The company later served a notice that the auction was canceled and the plan would proceed by swapping debt for stock to be owned by lenders, noteholders, and unsecured creditors. SHARON COBHAM: Case Summary & 12 Unsecured Creditors ---------------------------------------------------- Debtor: Sharon Jovanna Cobham, DDS, PA 2200 Silas Creek Parkway, Ste 3A Winston Salem, NC 27103 Bankruptcy Case No.: 13-50514 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court Middle District of North Carolina (Winston-Salem) Debtor's Counsel: Erik Mosby Harvey, Esq. CAROLINA LAW PARTNERS 2200 Silas Creek Parkway Suite 3A Winston Salem, NC 27103 Tel: (336) 500-0008 Fax: (336) 500-0011 E-mail: emh@carolinalawpartners.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 12 largest unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/ncmb13-50514.pdf The petition was signed by Sharon J. Cobham, president. SI ORGANIZATION: Moody's Lowers CFR to 'B3', Negative Outlook ------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating of The SI Organization, Inc. to B3 from B2 and assigned a B1 rating to SI's planned $45 million incremental first lien term loan. Proceeds of the term loan will fund a pending bolt-on acquisition. Concurrently, the facility will be amended to loosen financial maintenance covenant requirements. The rating outlook is changed to stable from negative. Ratings Downgraded: Corporate Family, to B3 from B2 Probability of Default, to B3-PD from B2-PD $40 million first lien revolver due 2015, to B1, LGD2, 26% from Ba3, LGD2, 28% $300 million first lien term loan due 2016, to B1, LGD2, 26% from Ba3, LGD2, 28% Ratings Assigned: $45 million incremental first lien term loan due 2016, B1, LGD2, 26% Rating Outlook: To Stable from Negative Ratings Rationale: The Corporate Family Rating downgrade to B3 from B2 reflects the modest level of free cash flow that has been achieved since the company's leveraged buy-out of November 2010, and further incorporates a challenging federal procurement environment that will likely constrict operating margin levels in the near to intermediate future. Metrics are on par with the B3 rating with free cash flow of 2% in 2012 and 3% in 2011, and debt to revenue exceeding 80%. Despite this rather modest free cash flow, SI is planning to fully debt fund its pending acquisition and the planned bank credit facility will liberalize the company's financial maintenance covenant requirements. The company's borrowing costs will rise. While credit statistics will probably improve in the future, they will probably do so slowly. The Stable rating outlook reflects that SI's strong track record as a systems engineering and integration specialist within the defense and intelligence communities should help to support or slightly grow billable labor hours even though fiscal austerity will weigh on the federal budget. Efficiency initiatives of federal agencies could indeed suit SI's expertise. Federal procurement reforms have forced even those highly specialized players like SI to demonstrate lower pricing, but the company has grown revenues in-step with other intelligence community focused peers - a favorable consideration since other, more broadly focused, contractors across the federal space are and will continue experiencing volume declines. Although SI is bidding more widely now than it has in the past, which adds administrative overhead, cost actions undertaken within the past year should support competitiveness. Low annual debt amortization requirements and the less demanding maintenance covenant provisions upcoming help the liquidity outlook. Bolstering the liquidity position gives SI more maneuvering room to best navigate what could become a choppy operating environment as sequestration funding caps take hold across 2014 and the May 19th U.S. debt ceiling limit approaches. The rating would be upgraded with expectation of better free cash flow generation and declining financial leverage. Expectation of debt to EBITDA of 6x or less with free cash flow to debt in the high single digit percentage range would add upward rating momentum. The rating would be downgraded with a lack of credit metric improvement, continuation of low free cash flow generation or weakening liquidity. The principal methodology used in this rating was the Global Aerospace and Defense Industry Methodology published in June 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. The SI Organization, Inc. provides advanced systems engineering and integration services to U.S. government intelligence agencies as well as related modeling, simulation, analysis and risk mitigation services. Revenues over 2012 were about $690 million. The company is majority-owned by entities of Veritas Capital. SOUTH PROCYON: Case Summary & 4 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: South Procyon Avenue, LLC 6430 South Procyon St. Las Vegas, NV 89118 Bankruptcy Case No.: 13-13516 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: Amanda M. Perach, Esq. Ryan J. Works, Esq. MCDONALD CARANO WILSON 2300 West Sahara Avenue Suite 1000 Las Vegas, NV 89102 Tel: (702) 873-4100 Fax: (702) 873-9966 E-mail: aperach@mcdonaldcarano.com rworks@mcdonaldcarano.com Scheduled Assets: $1,725,000 Scheduled Liabilities: $7,143,758 A copy of the Company's list of its four unsecured creditors, filed together with the petition, is available for free at http://bankrupt.com/misc/nvb13-13516.pdf The petition was signed by Charles J. Horky, trustee, Charles J. Horky III Family Trust (managing member). SPIN HOLDCO: Moody's Rates Proposed Senior Credit Facility 'B2' --------------------------------------------------------------- Moody's Investors Service assigned a B3 Corporate Family Rating and B3-PD Probability of Default Rating to Spin Holdco, Inc., a laundry service provider. At the same time, Moody's assigned a B2 rating to Spin Holdco's first lien senior secured credit facility, consisting of a $75 million revolver due 2018 and a $770 million term loan due in 2019. Proceeds will be used, together with a $325 million unrated second-lien term loan and equity of $270 million contributed by Pamplona Capital Partners III, L.P., to repay all of the existing debt of Coinmach Service Corp. (a Spin Holdco subsidiary) and to purchase and combine both Coinmach and a smaller entity that is in a related line within its route based business platform. The rating outlook is stable. The following rating actions were taken: Corporate Family Rating of B3 assigned to Spin Holdco; Probability of Default Rating of B3-PD assigned to Spin Holdco; $770 million first lien senior secured term loan due 2019 of Spin Holdco assigned a B2, LGD3-35%; $75 million first lien senior secured revolving credit facility due 2018 of Spin Holdco assigned a B2, LGD3-35%; Existing Corporate Family and Probability of Default ratings of Caa1 and Caa1-PD, respectively, on Coinmach Service Corp. will be withdrawn at closing; Existing B3 ratings on Coinmach Service Corp's $50 million existing senior secured revolving credit facility due 2013 and $775 million existing senior secured term loan facility due 2014 will be withdrawn at closing; Existing Caa3 rating on Coinmach Service Corp's $186 million existing senior unsecured notes due 2015 will be withdrawn at closing; The rating outlook on Spin Holdco is stable. Ratings Rationale: The B3 Corporate Family Rating assigned to Spin Holdco reflects Moody's expectation for a) minimal free cash flow generation over the next 12 to 18 months, b) weak adjusted interest coverage, as measured by (EBITDA - capex)/ interest expense, and c) net losses over the next 12-18 months. In addition, Moody's expects the company's propensity to grow via debt-financed acquisitions will keep pressure on adjusted debt leverage. At the same time, the B3 corporate family rating acknowledges Spin Holdco's stable revenue stream. Its track record and stability are driven by its large installed equipment base, geographic diversity, and long-term contracts in a business that tends to be relatively protected from the general economic cycle. As a result, revenues and EBITDA are fairly predictable. The U.S. rental vacancy rate has fallen from the high reached in the second half of 2009 and continues to improve. These factors, coupled with the company's size, economies of scale, and proven ability to raise vend prices, will continue to offset the impact of economic uncertainty. In addition, the combination of Spin Holdco's operations with that of a related business offers additional diversification benefits and the opportunity to reap some significant synergy gains. The rating also considers the company's adequate liquidity, supported by a new $75 million senior secured revolver which will be undrawn at closing, and an extended maturity profile, with no debt maturities until 2018. The company will be subject to a springing net first-lien leverage ratio under its revolver. The covenant will only be tested if utilization under the revolver exceeds 20% of the facility amount. The stable outlook reflects the company's steady, recurring revenue stream as well as slowly improving unemployment rates that will eventually benefit Spin Holdco's machine usage and EBITDA generation. The ratings could be upgraded if the company delevers to below 5.0x adjusted debt-to- EBITDA; and if adjusted interest coverage, as measured by (EBITDA- capex)/ interest expense, exceeds 1.75x, all on a sustained basis. The ratings could be downgraded if both the company's adjusted debt to EBITDA were to exceed 6.5x and adjusted interest coverage, as measured by (EBITDA- capex)/ interest expense, were to decline below 1.0x for a lengthy period of time. The first-lien senior secured credit facility is notched above the corporate family rating because it benefits from a collateral package that consists of 1) a first-lien on all assets; 2) upstream guarantees from Spin Holdco's domestic operating subsidiaries and downstream guarantees from Spin Holdco's parent company, and 3) the loss absorption provided by the unrated junior debt (second-lien term loan) in the amount of $325 million. 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. Spin Holdco, Inc., which itself is a wholly owned subsidiary of CSC ServiceWorks, Inc., is the single largest provider of outsourced laundry services for multi-family housing properties in North America through its Coinmach Service Corp. subsidiary. The company operates three business segments: a route business, which provides coin and card operated laundry services to owners of multi-family properties, and to a lesser extent, services and collects other route based equipment such as air and vacuum vending machines through its Air Valet division; a rental business, which leases laundry machines and other household appliances; and a distribution business, which involves constructing or retrofitting turnkey retail laundromats. As part of this transaction, a fund owned by the private equity firm of Pamplona Capital Management will acquire both Coinmach and a related business. Trailing 12-month revenues through December 31, 2012 for Coinmach were $578 million. SPRINT NEXTEL: Incurs $643 Million Net Loss in First Quarter ------------------------------------------------------------ Sprint Nextel Corp. reported a net loss of $643 million on $8.79 billion of net operating revenues for the quarter ended March 31, 2013, as compared with a net loss of $863 million on $8.73 billion of net operating revenues for the same period during the prior year. The Company's balance sheet at March 31, 2013, showed $50.75 billion in total assets, $44.28 billion in total liabilities and $6.47 billion in total shareholders' equity. "This is a transformative year for Sprint and we've gotten off to a good start," said Dan Hesse, Sprint CEO. "Record Sprint platform service revenue and subscriber levels fueled our performance. We achieved significant Adjusted OIBDA* growth while investing heavily to improve our network, expanding our 4G LTE footprint and offering customers the best smartphones with truly unlimited data plans." A copy of the press release is available for free at: http://is.gd/My58aI Amendment to Schedule 13E-3 An fifth amendment to Rule 13E-3 Transaction Statement on Schedule 13E-3 was jointly filed by Clearwire Corporation, Sprint Nextel Corporation, Sprint HoldCo, LLC, SN UHC 1, Inc., SN UHC 4, Inc., and Collie Acquisition Corp., in connection with the Agreement and Plan of Merger, dated as of Dec. 17, 2012, by and among Clearwire, Sprint and Merger Sub. If the Merger Agreement is adopted by Clearwire's stockholders, Merger Sub will merge with and into Clearwire, with Clearwire continuing as the surviving corporation. In the Merger, each issued and outstanding share of Class A common stock of Clearwire, par value $0.0001 per share will automatically be converted into the right to receive $2.97 per share in cash, without interest, less any applicable withholding taxes. In addition, Intel Capital Wireless Investment Corporation 2008A, a Delaware corporation and the only holder of Class B common stock of Clearwire other than Clearwire, Sprint and Sprint's affiliates, has elected to irrevocably exchange, immediately prior to the effective time of the Merger, all of its Class B Interests into shares of Class A Common Stock, which will then automatically convert into the right to receive the Merger Consideration at the effective time of the Merger. Concurrently with the filing of this Amendment No. 5 to Schedule 13E-3, Clearwire is filing a definitive proxy statement under Section 14(a) of the Securities Exchange Act of 1934, as amended, pursuant to which the Clearwire board of directors is soliciting proxies from stockholders of Clearwire in connection with the Merger, including to adopt the Merger Agreement. A copy of the Fifth Amendment is available for free at: http://is.gd/ECMJIs About Sprint Nextel Overland Park, Kan.-based Sprint Nextel Corp. (NYSE: S) -- http://www.sprint.com/-- is a communications company offering a comprehensive range of wireless and wireline communications products and services that are designed to meet the needs of individual consumers, businesses, government subscribers and resellers. Sprint Nextel incurred a net loss of $4.32 million in 2012, a net loss of $2.89 million in 2011, and a net loss of $3.46 million in 2010. Bankruptcy Warning "If the Merger Agreement terminates and we are unable to raise sufficient additional capital to fulfill our funding needs in a timely manner, or we fail to generate sufficient additional revenue from our wholesale and retail businesses to meet our obligations beyond the next twelve months, our business prospects, financial condition and results of operations will likely be materially and adversely affected, substantial doubt may arise about our ability to continue as a going concern and we will be forced to consider all available alternatives, including a financial restructuring, which could include seeking protection under the provisions of the United States Bankruptcy Code," the Company said in its annual report for the period ended Dec. 31, 2012. On Dec. 17, 2012, the Company entered into an agreement and plan of merger pursuant to which Sprint agreed to acquire all of the outstanding shares of Clearwire Corporation Class A and Class B common stock not currently owned by Sprint, SOFTBANK CORP., which or their affiliates. At the closing, the outstanding shares of common stock will be canceled and converted automatically into the right to receive $2.97 per share in cash, without interest. * * * As reported by the TCR on Oct. 17, 2012, Standard & Poor's Ratings Services said its ratings on Overland Park, Kan.-based wireless carrier Sprint Nextel Corp., including the 'B+' corporate credit rating, remain on CreditWatch. "The CreditWatch update follows the announcement that Sprint Nextel has agreed to sell a majority stake to Softbank," said Standard & Poor's credit analyst Allyn Arden. In the Oct. 17, 2012, edition of the TCR, Moody's Investors Service has placed all the ratings of Sprint Nextel, including its B1 Corporate Family Rating, on review for upgrade following the announcement that the Company has entered into a series of definitive agreements with SOFTBANK CORP. As reported by the TCR on Aug. 8, 2012, Fitch Ratings affirms, among other things, the Issuer default rating (IDR) of Sprint Nextel and its subsidiaries at 'B+'. The ratings for Sprint reflect the ongoing execution risk both operationally and financially regarding several key initiatives that the company expects will improve cash generation, network performance and longer-term profitability. STARCO VENTURES: Case Summary & 6 Unsecured Creditors ----------------------------------------------------- Debtor: Starco Ventures, Inc. 13799 Park Boulevard #263 Seminole, FL 33776 Bankruptcy Case No.: 13-05326 Chapter 11 Petition Date: April 24, 2013 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Judge: K. Rodney May Debtor's Counsel: Leon A. Williamson, Jr., Esq. LEON A. WILLIAMSON, JR., P.A. 306 S. Plant Avenue, Ste. B Tampa, FL 33606 Tel: (813) 253-3109 Fax: (813) 253-3215 E-mail: leon@lwilliamsonlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 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/flmb13-5326.pdf The petition was signed by Antoinette Van Putte, president. STREAMTRACK INC: Incurs $1.8-Mil. Net Loss in Fiscal 2013 Q2 ------------------------------------------------------------ StreamTrack, Inc., filed its quarterly report on Form 10-Q, reporting a net loss of $964,200 on $381,177 of revenues for the three months ended Feb. 28, 2013, compared with a net loss of $289,649 on $602,657 of revenues for the three months ended Feb. 29, 2012. The Company reported a net loss of $1.8 million on $866,214 of revenues for the six months ended Feb. 28, 2013, compared with a net loss of $289,649 on $602,657 of revenues for the period from inception, Nov. 30, 2011, to Feb. 29, 2012. The Company's balance sheet at Feb. 28, 2013, showed $1.5 million in total assets, $4.3 million in total liabilities, and a stockholders' deficit of $2.8 million. "For the three and six months ended Feb. 28, 2013, the Company recorded a net loss of $964,200 and $1,830,191, respectively. The net losses indicate that the Company may have difficulty continuing as a going concern." A copy of the Form 10-Q is available at http://is.gd/XV6VdR Santa Barbara, California-based StreamTrack, Inc., is a digital media and technology services company. The Company provides audio and video streaming and advertising services through the RadioLoyalty? Platform to over 1,300 internet and terrestrial radio stations and other broadcast content providers. SYNAGRO TECHNOLOGIES: Wins Approval of $30-Mil. DIP Financing ------------------------------------------------------------- Jamie Santo of BankruptcyLaw360 reported that a Delaware bankruptcy judge on Thursday gave interim approval to private equity-owned Synagro Technologies Inc.'s $30 million debtor-in- possession facility and signed off on a slate of other first-day motions to keep the waste management company humming while it moves toward a Section 363 sale. According to the report, owned by Carlyle Group LP, Synagro entered Chapter 11 on Wednesday with a DIP package in place and EQT Infrastructure II LP lined up as a $455 million stalking horse bidder. About Synagro Technologies Synagro Technologies, Inc., based in Houston, Texas, is the recycler of bio-solids and other organic residuals in the U.S. and is one of the largest national companies focused exclusivity on biosolids recycling, which has a market size of $2 billion. The Company was formed in 1986, under the name RPM Marketing, Inc. Synagro's corporate headquarters is currently located in Houston, Texas but is in the process of being transferred to White Marsh, Maryland. The Company also has offices in Lansdale, Pennsylvania, Rayne, Louisiana, and Watertown, Connecticut. Synagro Technologies and 29 affiliates sought Chapter 11 protection (Bankr. D. Del. Case no. 13-11041) on April 24, 2013. Synagro is being advised by the law firm of Skadden Arps Slate Meagher & Flom, along with financial adviser AlixPartners and investment bankers Evercore Partners. Kurtzman Carson & Consultants serves as notice and claims agent. Synagro was owned by The Carlyle Group at the time of the bankruptcy filing. SYNAGRO TECHNOLOGIES: Case Summary & Creditors List --------------------------------------------------- Debtor: Synagro Technologies, Inc. aka RPM Marketing, Inc. Silver Hills Consolidated Mining Corp. N-Viro Recover, Inc. 1800 Bering Drive, Suite1000 Houston, TX 77057 Bankruptcy Case No.: 13-11041 Affiliates that simultaneously filed Chapter 11 petitions: Debtor Case No. ------ -------- Synagro-WWT, Inc. 13-11042 ST Interco, Inc. 13-11043 Synagro Central, LLC 13-11044 Synagro Northeast, LLC 13-11045 Synagro South, LLC 13-11046 Synagro West, LLC 13-11047 Synagro Drilling Solutions, LLC 13-11048 Synagro-WCWNJ, LLC 13-11049 South Kern Industrial Center, LLC 13-11050 Synagro - Connecticut, LLC 13-11051 Synagro Woonsocket, LLC 13-11052 Synagro Texas, LLC 13-11053 Providence Soils, LLC 13-11054 Synagro Detroit, LLC 13-11055 Synagro Hypex, LLC 13-11057 Synagro Product Distribution, LLC 13-11058 Synagro of California, LLC 13-11059 Synagro of Minnesota-Rehbein, LLC 13-11060 Environmental Protection & Improvement 13-11061 Company, LLC Synagro of Texas - CDR, Inc. 13-11062 Earthwise Organics, LLC 13-11063 Synagro Composting Company of 13-11064 California, LLC Drilling Solutions, LLC 13-11065 NETCO - Waterbury, LP 13-11066 New Haven Residuals, LP 13-11067 Synagro Management, LP 13-11068 Soaring Vistas Properties, LLC 13-11069 New York Organic Fertilizer Company 13-11070 Synatech Holdings, Inc. 13-11071 Chapter 11 Petition Date: April 24, 2013 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Judge: Brendan Linehan Shannon Debtors' Counsel: Mark S. Chehi, Esq. SKADDEN ARPS SLATE MEAGHER & FLOM, LLP One Rodney Square, P.O. Box 636 Wilmington, DE 19899-0636 Tel: (302) 651-3000 Fax: (302) 651-3160 E-mail: mark.chehi@skadden.com Debtors' Investment Banker: EVERCORE GROUP, LLC Debtors' Financial Advisor: ALIXPARTNERS Debtors' Communications And Public Relations Consultants: SITRICK AND COMPANY Debtors' Claims and Noticing Agent: KURTZMAN CARSON CONSULTANTS, LLC Lead Debtor's Estimated Assets: $10,000,001 to $50,000,000 Lead Debtor's Estimated Debts: $100,000,001 to $500,000,000 The petitions were signed by Joseph L. Page, vice president and secretary. Debtors' Consolidated List of List of 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ U.S. Bank Second Lien $100,442,000 c/o Lisa Dolan 214 North Tryon Street, 26th Floor Charlotte, NC 28202 Waste Management Trade Debt $585,663 c/o Jacquie Mills 1001 Fannin Street, Suite 4000 Houston, TX 77002 Automotive Rentals, Inc. Trade Debt $583,198 4001 Leadenhall Road Mount Laurel, NJ 08054 City of Waterbury Trade Debt $474,046 235 Grand Street Waterbury, CT 06702 All State Construction, Inc. Trade Debt $382,667 449 Cooke Street Farmington, CT 06032 City of Woonsocket Trade Debt $325,409 c/o Susan D. Menard, mayor 169 Main Street Woonsocket, RI 02895 Lofton Staffing Services Trade Debt $316,785 9700 Richmond Avenue, Suite 151 Houston, TX 77042 CSX Transportation Trade Debt $301,703 500 Water Street, 15th Floor Jacksonville, FL 32202 Castle Bronx Terminals Trade Debt $279,255 500 Mamaroneck Avenue Harrison, NY 10528 G.I.C. Corporation Trade Debt $244,399 Norfolk Southern Corporation Trade Debt $197,576 Gatx Rail, a division of Gatx Trade Debt $190,450 Municipal Maintenance Co. Inc. Trade Debt $102,771 Advanced Disposal Services Trade Debt $89,813 WPCA Trade Debt $89,198 Rumpke Trade Debt $88,131 W M Lyles Co. Trade Debt $88,107 McCarty Road Landfill Texas, LP Trade Debt $79,707 Industrial Steam Trade Debt $79,211 Union County Landfill Trade Debt $79,125 Energy Electric Company, Inc. Trade Debt $67,753 Greer Industries ICC Trade Debt $67,031 BFI ? CMS Landfill Trade Debt $66,566 Jerrod A. Jess Trade Debt $64,403 Santa Buckley Energy, Inc. Trade Debt $61,389 Kochergen Farms Composting Trade Debt $61,031 Unum Life Insurance Trade Debt $60,917 CBI Services, Inc. Trade Debt $60,084 Ryan, LLC Trade Debt $58,095 A&L Eastern Agricultural Trade Debt $57,351 Laboratories, Inc. SYNAGRO TECHNOLOGIES: Chap. 11 No Immediate Impact on Fitch Rating ------------------------------------------------------------------ Fitch Ratings believes that the recent bankruptcy filing of Synagro Technologies Inc. (STI) will not immediately affect the credit quality of Synagro-Baltimore LLC (series 2008 A revenue refunding bonds rated 'BBB+' by Fitch) or Philadelphia Project Finance, LLC (series 2009 sewage sludge disposal revenue bonds rated 'BBB'). The Rating Outlook for Synagro-Baltimore LLC and Philadelphia Project Finance, LLC (collectively, the project companies) remains Stable. Fitch believes there is no imminent risk that the project companies' credit quality will be affected by STI's Chapter 11 bankruptcy filing, which named a number of STI's subsidiaries but excluded the indirectly-owned project companies. Fitch cannot predict whether any of STI's creditors will seek substantive consolidation of the project companies as part of the STI bankruptcy. The project companies have been organized as bankruptcy-remote, special-purpose vehicles, mitigating the potential for substantive consolidation. STI announced that EQT Infrastructure II (EQT), a European private equity fund, has agreed to purchase substantially all of STI's assets. STI states that the bankruptcy filing is intended to reorganize STI's capital structure and facilitate the sale to EQT. STI's voluntary petition for reorganization was filed in the U.S. Bankruptcy Court for the District of Delaware. The project companies are special-purpose vehicles created to own and operate sludge-processing facilities that provide disposal services to their respective municipalities under availability- based, fixed price service agreements. STI is the largest recycler of organic residuals in the United States. STI serves over 600 water and wastewater treatment facilities and manages over 350 dry tons of municipal biosolids per day through thermal drying and pelletization processes. SYNAGRO TECHNOLOGIES: Moody's Downgrades PDR After Ch. 11 Filing ---------------------------------------------------------------- Moody's Investors Service lowered Synagro Technologies' probability of default rating (PDR) to D-PD from Caa3-PD following the company's bankruptcy filing on April 24, 2013. Moody's affirmed the Caa3 corporate family, Caa2 first lien term loan, and Ca second lien term loan ratings. Moody's plans to withdraw all Synagro ratings by the end of April 2013, consistent with the policy for companies operating under bankruptcy protection. Ratings: Corporate Family Rating: Affirmed at Caa3 Probability of Default Rating: Lowered to D-PD from Caa3 First Lien Term Loan: Affirmed at Caa2 LGD 3/37% Second Lien Term Loan: Affirmed at Ca LGD5/86% Ratings Rationale: The lowering of the probability of default rating to D-PD follows the April 24, 2013 bankruptcy filing by Synatech Holdings, Inc. and its subsidiary Synagro Technologies, Inc. and guarantor subsidiaries. The company made this filing in the context of an agreement to sell the company's assets to a fund affiliated with EQT, a Europe headquartered private equity manager. Of note, the company's special purpose entities which own specific waste treatment facilities included in the sale did not file for bankruptcy. Under provision 363 of the bankruptcy code, the buyer will purchase the assets for $455 million, gross of fees and debt assumed. 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. Synagro Technologies, Inc., based in Houston, Texas, is a recycler of bio-solids and other organic residuals in the U.S. Revenue in 2012 was $319 million and the total debt balance on December 31, 2012 was $502 million. The company is majority-owned by entities of The Carlyle Group. TARGETED MEDICAL: Reports $2.8 Million Revenue in 1st Quarter ------------------------------------------------------------- Targeted Medical Pharma, Inc., reported unaudited revenue of $2,811,000 for the first quarter ended on March 31, 2013, a 104% increase from the $1,375,000 reported for the same period of the prior year and increased from $2,396,000 of the fourth quarter of 2012. "We continued to experience steady growth of new markets nationally, and an increase in both prescribing and insurance reimbursements for our high value medications," said chief executive and chief science officer William Shell, M.D. "Our proprietary medical foods are becoming more widely prescribed as they are appealing to both physicians and patients who are in need of safe and efficacious medications for the treatment of complex disease states." 2013 Strategic Initiatives The key initiatives the Company intends to pursue to continue accelerating revenue growth for fiscal year 2013 are: * Expand sales and marketing efforts to increase - prescribing in the Workers' Compensation markets - prescribing in the private insurance markets - prescribing in the Medicare and Medicaid markets * Conduct additional clinical trials for current and pipeline products * Continue development of new products for neuropathy, chronic anemia, asthma, and diabetes "This was our 5th consecutive quarter of growth and our most exceptional to date," said David S. Silver, M.D., Targeted Medical Pharma's president and chief operating officer. "The growing demand for our prescription medications by both patients and physicians who have long sought alternatives to more dangerous prescription drugs has helped support this sustained growth." The Company also filed with the SEC a presentation that it expects to provide to potential investors, a copy of which is available for free at http://is.gd/70eU8U About Targeted Medical Los Angeles, Calif.-based Targeted Medical Pharma, Inc., is a specialty pharmaceutical company that develops and commercializes nutrient- and pharmaceutical-based therapeutic systems. Targeted Medical disclosed a comprehensive loss of $9.58 million on $7.29 million of total revenue for the year ended Dec. 31, 2012, as compared with a comprehensive loss of $4.18 million on $8.81 million of total revenue during the prior year. The Company's balance sheet at Dec. 31, 2012, showed $11.77 million in total assets, $13.77 million in total liabilities, and a $2 million total shareholders' deficit. EFP Rotenberg, LLP, in Rochester, New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has losses for the year ended Dec. 31, 2012, totaling $9,586,182 as well as accumulated deficit amounting to $13,684,789. Further the Company does not have adequate cash and cash equivalents as of Dec. 31, 2012, to cover projected operating costs for the next 12 months. As a result, the Company is dependent upon further financing, related party loans, development of revenue streams with shorter collection times and accelerating collections on the Company's physician managed and hybrid revenue streams. TCB PROPERTY: Case Summary & 5 Unsecured Creditors -------------------------------------------------- Debtor: TCB Property Management Corp. P.O. Box 280018 Tampa, FL 33682 Bankruptcy Case No.: 13-11285 Chapter 11 Petition Date: April 23, 2013 Court: U.S. Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Joel M. Shafferman, Esq. SHAFFERMAN & FELDMAN, LLP 18 East 41st Street, Suite 1201 New York, NY 10017 Tel: (212) 509-1802 Fax: (212) 509-1831 E-mail: joel@shafeldlaw.com Scheduled Assets: $5,000,000 Scheduled Liabilities: $2,057,227 The Company's list of its five largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/nysb13-11285.pdf The petition was signed by Mr. Kenneth Collado. THAPAN GROUP: Case Summary & 5 Unsecured Creditors -------------------------------------------------- Debtor: Thapan Group, LLC 722 Forest Road Northford, CT 06472 Bankruptcy Case No.: 13-30743 Chapter 11 Petition Date: April 23, 2013 Court: U.S. Bankruptcy Court District of Connecticut (New Haven) Judge: Joel B. Rosenthal Debtor's Counsel: Neil Crane, Esq. LAW OFFICES OF NEIL CRANE, LLC 2679 Whitney Avenue Hamden, CT 06518 Tel: (203) 230-2233 Fax: (203) 230-8484 E-mail: neilcranecourt@neilcranelaw.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 five largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/ctb13-30743.pdf The petition was signed by Nalini Y. Patel, member manager. TRINITY COAL: Gets Final Approval to Pay Critical Vendors --------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Kentucky, in a final order, authorized Trinity Coal Corporation, et al., to pay certain pre-relief claims of critical vendors. The Court also ordered that for the identified critical vendors only, if there are any additional claims of the critical vendors, the Debtors may pay any or all of such additional claims, up to a maximum aggregate amount of $200,000, so long as either (i) the Committee has given its prior consent to any the payments or (ii) the payments are authorized by further order of the Court. The Debtors previously obtained an interim order authorizing payment of certain claims of 10 critical vendors. In the motion, the Debtors assured the Court that the aggregate amount of these Critical Vendors payments won't exceed $652,000 in total. According to the Debtors, there is an excess of $30 million owing to trade creditors for goods and services provided to the Debtors prior to the commencement of the Chapter 11 cases. The Debtors said that the Vendor Claims Cap is relatively small in light of the total amount of vendor claims the Debtors anticipate to be asserted against them in the Chapter 11 cases, which is estimated to be over $30 million. About Trinity Coal Trinity Coal Corp. is a coal mining company that owns coal deposits located in the Appalachian region of the eastern United States, specifically, in Breathitt, Floyd, Knott Magoffin, and Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo, McDowell and Wyoming Counties in West Virginia. Trinity's coal mining operations are organized into six distinct coal mining complexes. Three complexes are located in Kentucky and are referred to as Prater Branch Resources, Little Elk Mining and Levisa Fork. The Kentucky Operations produced compliance and low sulfur steam coal. Three complexes are located in West Virginia and are referred to as Deep Water Resources, North Springs Resources and Falcon Resources. Trinity is a wholly owned subsidiary of privately held multinational conglomerate Essar Global Limited. Credit Agricole Corporate & Investment Bank, ING Capital LLC and Natixis, New York Branch filed an involuntary petition for relief under Chapter 11 against Trinity Coal Corporation and 15 affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three entities say they are owed a total of $104 million on account loans provided to Trinity. On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and Cecil I. Walker Machinery Co. filed an involuntary petition for relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335) against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit Agricole, ING Capital and Natixis joined as petitioning creditors. On March 4, 2013, the Debtors filed their consolidated answer to involuntary petitions and consent to an order for relief and reservation of rights, thereby consenting to the entry of an order for relief in each of their respective Chapter 11 cases. An order for relief in each of the Debtors was entered by the Court on March 4, 2013, which converted these involuntary cases to voluntary Chapter 11 cases. TRINITY COAL: Members of Unsecured Creditors Committee ------------------------------------------------------ Samuel K. Crocker, U.S. Trustee for Region 8, last month appointed four creditors to serve in the Official Committee of Unsecured Creditors in the Chapter 11 cases of Trinity Coal Corporation, et al. The Committee comprises of: 1. Austin Powder Company, Interim Chair Attn: David True, President 25800 Science Park Drive Cleveland, OH 44122 Tel: (216) 839-5440 E-mail:dave.true@austinpowder.com 2. Duke Energy Carolinas, LLC Attn: Eric M. Cavanaugh, associate general counsel Duke Energy Corporation 526 South Church Street Charlotte, NC 28202 Tel: (317) 838-2081 E-mail: eric.cavanaugh@duke-energy.com 3. Whayne Supply Company Attn: Kevin Lee, treasurer and general credit manager 1400 Cecil Avenue Louisville, KY 40211-1626 Tel: (502) 774-4441 E-mail: kevin_lee@whayne.com 4. Central Contracting, Inc. Attn: Steve Cvechko, President P.O. Box 1485 St. Albans, WV 25177 Tel: (304) 722-4939 E-mail: stevec@ccentralc.com About Trinity Coal Trinity Coal Corp. is a coal mining company that owns coal deposits located in the Appalachian region of the eastern United States, specifically, in Breathitt, Floyd, Knott Magoffin, and Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo, McDowell and Wyoming Counties in West Virginia. Trinity's coal mining operations are organized into six distinct coal mining complexes. Three complexes are located in Kentucky and are referred to as Prater Branch Resources, Little Elk Mining and Levisa Fork. The Kentucky Operations produced compliance and low sulfur steam coal. Three complexes are located in West Virginia and are referred to as Deep Water Resources, North Springs Resources and Falcon Resources. Trinity is a wholly owned subsidiary of privately held multinational conglomerate Essar Global Limited. Credit Agricole Corporate & Investment Bank, ING Capital LLC and Natixis, New York Branch filed an involuntary petition for relief under Chapter 11 against Trinity Coal Corporation and 15 affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three entities say they are owed a total of $104 million on account loans provided to Trinity. On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and Cecil I. Walker Machinery Co. filed an involuntary petition for relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335) against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit Agricole, ING Capital and Natixis joined as petitioning creditors. On March 4, 2013, the Debtors filed their consolidated answer to involuntary petitions and consent to an order for relief and reservation of rights, thereby consenting to the entry of an order for relief in each of their respective Chapter 11 cases. An order for relief in each of the Debtors was entered by the Court on March 4, 2013, which converted these involuntary cases to voluntary Chapter 11 cases. TRINITY COAL: Wants to Hire D.J. Geiger as Mining Consultant ------------------------------------------------------------ Trinity Coal Corporation, et al., ask the U.S. Bankruptcy Court for the Eastern District of Kentucky for permission to employ D.J. Geiger & Co., LLC as mining consultant effective as of March 25, 2013. D.J. Geiger will provide management expertise skilled in mine reclamation and mine operations consistent with regulatory requirements and assist with the sale of assets in the Debtors' Chapter 11 proceedings. Subject to the Court's approval, D.J. Geiger & Co. will not be required to file interim fee applications pursuant to Section 331 of the Bankruptcy Code and can be paid in accordance with the consulting agreement. When its services are concluded, D.J. Geiger & Co. will file a final fee application with the Court. To the best of the Debtors' knowledge, D.J. Geiger is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Trinity Coal Trinity Coal Corp. is a coal mining company that owns coal deposits located in the Appalachian region of the eastern United States, specifically, in Breathitt, Floyd, Knott Magoffin, and Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo, McDowell and Wyoming Counties in West Virginia. Trinity's coal mining operations are organized into six distinct coal mining complexes. Three complexes are located in Kentucky and are referred to as Prater Branch Resources, Little Elk Mining and Levisa Fork. The Kentucky Operations produced compliance and low sulfur steam coal. Three complexes are located in West Virginia and are referred to as Deep Water Resources, North Springs Resources and Falcon Resources. Trinity is a wholly owned subsidiary of privately held multinational conglomerate Essar Global Limited. Credit Agricole Corporate & Investment Bank, ING Capital LLC and Natixis, New York Branch filed an involuntary petition for relief under Chapter 11 against Trinity Coal Corporation and 15 affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three entities say they are owed a total of $104 million on account loans provided to Trinity. On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and Cecil I. Walker Machinery Co. filed an involuntary petition for relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335) against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit Agricole, ING Capital and Natixis joined as petitioning creditors. On March 4, 2013, the Debtors filed their consolidated answer to involuntary petitions and consent to an order for relief and reservation of rights, thereby consenting to the entry of an order for relief in each of their respective Chapter 11 cases. An order for relief in each of the Debtors was entered by the Court on March 4, 2013, which converted these involuntary cases to voluntary Chapter 11 cases. UNI-PIXEL INC: Obtains $44 Million From Public Offering ------------------------------------------------------- Uni-Pixel, Inc., has closed its previously-announced underwritten public offering of 1,195,000 common shares, and the exercise of the over-allotment option to purchase an additional 179,250 common shares, at a price to the public of $32.00 per share for gross proceeds to the company of $44 million. Uni-Pixel intends to use the proceeds from the offering for working capital and general corporate purposes. Cowen and Company, LLC, and Craig-Hallum Capital Group LLC acted as joint book-running managers for the offering. A shelf registration statement (File No. 333-181656) relating to these securities was previously filed with, and declared effective by, the U.S. Securities and Exchange Commission, and a registration statement registering additional securities of the same class for the same offering was filed with the U.S. Securities and Exchange Commission (File No. 333-187975) pursuant to Rule 462(b) under the Securities Act of 1933, as amended. A preliminary prospectus supplement related to the offering was filed with the U.S. Securities and Exchange Commission on April 17, 2013. A final prospectus supplement related to the offering was filed with the U.S. Securities and Exchange Commission on April 18, 2013. Copies of the final prospectus supplement and accompanying prospectus relating to the offering may be obtained by contacting Cowen and Company, LLC c/o Broadridge Financial Services, 1155 Long Island Avenue, Edgewood, NY,11717, Attn: Prospectus Department, Phone: 631-274-2806, Fax: 631-254-7140; or from Craig-Hallum Capital Group LLC, 222 South Ninth Street, Suite 350, Minneapolis, MN 55402, by calling 612- 334-6300, or by emailing bart.federak@craig-hallum.com. An electronic copy of the final prospectus supplement and accompanying prospectus relating to the offering is available on the website of the SEC at www.sec.gov. About Uni-Pixel Inc. The Woodlands, Tex.-based Uni-Pixel, Inc. (OTC BB: UNXL) -- http://www.unipixel.com/-- is a production stage company delivering its Clearly Superior(TM) Performance Engineered Films to the Lighting & Display, Solar and Flexible Electronics market segments. Uni-Pixel incurred a net loss of $9.01 million in 2012, as compared with a net loss of $8.56 million in 2011. The Company's balance sheet at Dec. 31, 2012, showed $14.71 million in total assets, $348,683 in total liabilities and $14.36 million in total shareholders' equity. "As of December 31, 2012, we had a cash balance of approximately $13.0 million and working capital of $12.8 million. We project that current cash reserves will sustain our operations through at least December 31, 2013, and we are not aware of any trends or potential events that are likely to adversely impact our short term liquidity through this term. We expect to fund our operations with our net product revenues from our commercial products, cash and cash equivalents supplemented by proceeds from equity or debt financings, and loans or collaborative agreements with corporate partners, each to the extent necessary," according to the Company's annual report for the year ended Dec. 31, 2012. UNIGENE LABORATORIES: VPC Closes Auction of Peptelligence Assets ---------------------------------------------------------------- Unigene Laboratories, Inc., said that on April 16, 2013, Victory Park Capital Advisors, LLC, held a public auction conducted in accordance with Article 9 of the Uniform Commercial Code (UCC) for the sale of certain of Unigene's assets that secure approximately $56.7 million in senior secured notes issued to affiliates of VPC by Unigene. The assets concerned include Unigene's PeptelligenceTM drug delivery and recombinant manufacturing platforms and all other assets that comprised the Company's Biotechnologies Strategic Business Unit (SBU). The holders of the senior secured notes made a credit bid of $15 million and, at the conclusion of the public auction, were deemed the highest bidder for the assets. The assets are to be acquired by an affiliate of VPC in exchange for the satisfaction and discharge of $15 million outstanding under the senior secured notes. The closing of the sale of the assets is anticipated to occur promptly. After accounting for the credit bid, approximately $41.7 million will remain outstanding under the senior secured notes. The assets of the Company not acquired during the public sale will consist of the therapeutic assets comprising the Company's Therapeutics SBU, including Fortical(R) nasal spray; oral calcitonin, licensed to Tarsa Therapeutics, Inc.; UGP302, being developed for the treatment of diabetes via a joint venture with Nordic BioScience; oral PTH; and the anorexigenic agent UGP281. All of these assets will remain with the Company. About Unigene Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/ -- is a biopharmaceutical company focusing on the oral and nasal delivery of large-market peptide drugs. Unigene disclosed a net loss of $34.28 million on $9.43 million of total revenue for the year ended Dec. 31, 2012, as compared with a net loss of $7.09 million on $20.50 million of total revenue during the prior year. The Company incurred a $32.53 million net loss in 2010. The Company's balance sheet at Dec. 31, 2012, showed $11.31 million in total assets, $110.05 million in total liabilities and a $98.73 million total stockholders' deficit. Grant Thornton LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has incurred a net loss of $34,286,000 during the year ended Dec. 31, 2012, and, as of that date, has an accumulated deficit of approximately $216,627,000 and the Company's total liabilities exceeded total assets by $98,740,000. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Bankruptcy Warning "We had cash flow deficits from operations of $3,177,000 for the year ended December 31, 2012, $6,766,000 for the year ended December 31, 2011 and $1,669,000 for the year ended December 31, 2010. Our cash and cash equivalents totaled approximately $3,813,000 on December 31, 2012. Based upon management's projections, we believe our current cash will only be sufficient to support our current operations through approximately March 31, 2013. Therefore, we need additional sources of cash in order to maintain all or a portion of our operations. We may be unable to raise, on acceptable terms, if at all, the substantial capital resources necessary to conduct our operations. If we are unable to raise the required capital, we may be forced to close our facilities and cease our operations. If we are unable to resolve outstanding creditor claims, we may have no other alternative than to seek protection under available bankruptcy laws. Even if we are able to raise additional capital, we will likely be required to limit some or all of our research and development programs and related operations, curtail development of our product candidates and our corporate function responsible for reviewing license opportunities for our technologies." UNIVERSAL HEALTH: Soneet Kapila Named Chapter 11 Trustee -------------------------------------------------------- Soneet Kapila was appointed last week as Chapter 11 Trustee for the bankruptcy estate of the parent company of Universal Health Care Group. Jeff Harrington, writing for Tampa Bay Times, reports that Mr. Kapila, 60, a Fort Lauderdale CPA and bankruptcy trustee veteran talked with the Tampa Bay Times about the job ahead, including going after the third-party managed care company run by Universal founder Akshay Desai to help pay back creditors. According to the interview, Mr. Kapila expects the process to be long. "I will need to investigate . . . any potential assets that can be recovered by any litigation. That requires a fair amount of investigation. We will receive that initial (assessment) over the next weeks, maybe months, and do an analysis of any recovery actions," he said in the interview. Some excerpts of the interview are available at http://is.gd/N4GbItfrom Tampa Bay Times. 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. WASHINGTON AVENUE: Case Summary & 3 Unsecured Creditors ------------------------------------------------------- Debtor: Washington Avenue Murrieta, LLC 7 Argonaut Aliso Viejo, CA 92656 Bankruptcy Case No.: 13-13587 Chapter 11 Petition Date: April 23, 2013 Court: U.S. Bankruptcy Court Central District of California (Santa Ana) Judge: Catherine E. Bauer Debtor's Counsel: Jeffrey S. Benice, Esq. LAW OFFICES OF JEFFREY S. BENICE, APLC 650 Town Center Drive, Suite 1300 Costa Mesa, CA 92626 Tel: (714) 641-3600 Fax: (714) 641-3604 E-mail: jsb@jeffreybenice.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its three largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/cacb13-13587.pdf The petition was signed by Dan Harkey, president of Pont Center Financial, management company. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Point Center Financial, Inc. 13-11495 02/19/13 WCI COMMUNITIES: Hires Banks for IPO Later This Year ---------------------------------------------------- Olivia Oran, writing for Reuters, reported that WCI Communities has hired banks for an initial public offering later this year, according to two sources familiar with the matter, as the formerly bankrupt luxury home builder tries to capitalize on a recovery in the U.S. housing sector. According to the Reuters report, the Bonita Springs, Florida-based company has hired Citigroup Inc and Credit Suisse to lead the deal, the sources said. The people asked not to be named because the matter is not public. Under chairman Carl Icahn, WCI Communities filed for bankruptcy in August 2008 after being hit hard during the housing downturn and failing to obtain financing, Reuters related. WCI Communities' bankruptcy filing was among the biggest in builder bankruptcies, which also included Tousa Inc and Levitt & Sons. After eliminating $2 billion in debt, WCI emerged from bankruptcy in September 2009 as a private company, with private investment firm Monarch Alternative Capital as its largest shareholder, Reuters further related. Last year, WCI reported sales of 461 new homes in Florida which totaled $185.9 million, up 73 percent from the year prior. WCI is hoping to capitalize on a rebound in the U.S. housing sector, which has encouraged other companies including Taylor Morrison Home Corp, Tri Pointe Homes Inc and Boise Cascade Co to pursue IPOs, according to the report. About WCI Communities Headquartered in Bonita Springs, Florida, WCI Communities, Inc. (Pink Sheets: WCIMQ) -- http://www.wcicommunities.com/-- is a fully integrated homebuilding and real estate services company with more than 50 years' experience in the design, construction and operation of leisure-oriented, amenity rich master-planned communities. It has operations in Florida, New York, New Jersey, Connecticut, Virginia and Maryland. The Company and 126 of its affiliates filed for Chapter 11 protection on August 4, 2008 (Bankr. D. Del. Lead Case No. 08-11643 through 08-11770). On July 1, 2009, debtor-affiliates WCI 2009 Corporation, WCI 2009 Management, LLC and WCI 2009 Asset Holding, LLC filed separate Chapter 11 petitions (Case Nos. from 09-12269 to 09-12271). Thomas E. Lauria, Esq., Frank L. Eaton, Esq., and Linda M. Leali, Esq., at White & Case LLP, in Miami, Florida, represented the Debtors as counsel. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, represented the Debtors as Delaware counsel. Lazard Freres & Co. LLC acted as the Debtors' financial advisor. Epiq Bankruptcy Solutions LLC served as the claims and notice agent for the Debtors. The U.S. Trustee for Region 3 appointed five creditors to serve on an official committee of unsecured creditors. Daniel H. Golden, Esq., Lisa Beckerman, Esq., and Philip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP; and Laura Davis Jones, Esq., Michael R. Seidl, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, represented the committee. WCI disclosed total assets of $2,178,179,000 and total debts of $1,915,034,000 when it filed for Chapter 11. The Bankruptcy Court on Aug. 26, 2009, confirmed the Second Amended Joint Chapter 11 Plan of Reorganization for WCI Communities, Inc. and its affiliates. The Plan became effective Sept. 3, 2009. WEST CORP: Files Preliminary Form S-1 Prospectus with SEC --------------------------------------------------------- West Corporation filed with the U.S. Securities and Exchange Commission a Form S-1 registration statement relating to an initial public offering of shares of common stock of the Company. No public market for the Company's common stock has existed since our recapitalization in 2006. The Company is offering an undetermined number of shares to be sold. The selling stockholders identified in the prospectus are offering an additional [ ] shares of the Company's common stock. The Company will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders. The Company anticipates that the initial public offering price per share will be between $ [ ] and $[ ]. The Company has applied to list its common stock on the Nasdaq Global Select Market under the symbol "WSTC." A copy of the Form S-1 prospectus, as amended ten times, is available at http://is.gd/mPN5P8 About West Corporation Founded in 1986 and headquartered in Omaha, Nebraska, West Corporation -- http://www.west.com/-- provides outsourced communication solutions to many of the world's largest companies, organizations and government agencies. West Corporation has a team of 41,000 employees based in North America, Europe and Asia. West Corporation reported net income of $125.54 million in 2012, net income of $127.49 million in 2011, and net income of $60.30 million in 2010. The Company's balance sheet at Dec. 31, 2012, showed $3.44 billion in total assets, $4.69 billion in total liabilities and a $1.24 billion total stockholders' deficit. Bankruptcy Warning The Company said the following statement in its 2012 Annual Report: "If our cash flows and capital resources are insufficient to fund our debt service obligations and to fund our other liquidity needs, we may be forced to reduce or delay capital expenditures or declared dividends, sell assets or operations, seek additional capital or restructure or refinance our indebtedness. We cannot make assurances that we would be able to take any of these actions, that these actions would be successful and permit us to meet our scheduled debt service obligations or that these actions would be permitted under the terms of our existing or future debt agreements, including our senior secured credit facilities or the indentures that govern our outstanding notes. Our senior secured credit facilities documentation and the indentures that govern the notes restrict our ability to dispose of assets and use the proceeds from the disposition. As a result, we may not be able to consummate those dispositions or use the proceeds to meet our debt service or other obligations, and any proceeds that are available may not be adequate to meet any debt service or other obligations then due. If we cannot make scheduled payments on our debt, we will be in default of such debt and, as a result: * our debt holders could declare all outstanding principal and interest to be due and payable; * our debt holders under other debt subject to cross default provisions could declare all outstanding principal and interest on such other debt to be due and payable; * the lenders under our senior secured credit facilities could terminate their commitments to lend us money and foreclose against the assets securing our borrowings; and * we could be forced into bankruptcy or liquidation." * * * West Corp. carries a 'B2' corporate rating from Moody's and 'B+' corporate rating from Standard & Poor's. Moody's Investors Service upgraded the ratings on West Corporation's existing senior secured term loan to Ba3 from B1 and the rating on $650 million of existing senior notes due 2014 to B3 from Caa1 upon the closing of its recent refinancing transactions. Concurrently, Moody's affirmed all other credit ratings including the B2 Corporate Family Rating and B2 Probability of Default Rating. The rating outlook is stable. Standard & Poor's Ratings Services assigned Omaha, Neb.-based business process outsourcer West Corp.'s proposed $650 million senior unsecured notes due 2019 its 'B' issue-level rating (one notch lower than the 'B+' corporate credit rating on the company). The recovery rating on this debt is '5', indicating S&P's expectation of modest (10% to 30%) recovery in the event of a payment default. The company will use proceeds from the proposed transaction and some cash on the balance sheet to redeem its $650 million 9.5% senior notes due 2014. As reported by the TCR on March 21, 2013, Standard & Poor's Ratings Services placed its 'B+' corporate credit rating on Omaha, Neb.-based business process outsourcer West Corp., along with all issue-level ratings on the company's debt, on CreditWatch with positive implications. The CreditWatch placement is based on West Corp.'s announcement that it will raise about $500 million through an initial public offering and use most of the proceeds to repay debt. Pro forma for the debt repayment, lease-adjusted leverage is 5.3x, compared with 5.9x at Dec. 31, 2012. WMG ACQUISITION: Moody's Rates Proposed Incremental Term Loan Ba3 ----------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to the proposed incremental term loan facility to be issued by WMG Acquisition Corp., and downgraded the ratings on the existing senior secured credit facilities and senior secured notes (also issued by WMG Acquisition Corp.) to Ba3 from Ba2. WMG Acquisition Corp. is a wholly-owned subsidiary of WMG Holdings Corp. ("WMG Holdings"), which in turn is a wholly-owned subsidiary of Warner Music Group Corp. ("WMG" or the "company"). This rating action follows WMG's announcement that it intends to upsize WMG Acquisition Corp.'s existing $592 million senior secured term loan by $820 million. In connection with this rating action, Moody's also affirmed the B3 ratings on the existing senior notes issued by WMG Acquisition Corp. and the HoldCo notes issued by WMG Holdings, as well as the B1 Corporate Family Rating (CFR) and B1- PD Probability of Default Rating (PDR) at WMG Holdings. The rating outlook is stable. WMG will use the incremental term loan proceeds to finance the purchase of Parlophone Label Group ("Parlophone") from Universal Music Group (a subsidiary of French mass media and telecommunications conglomerate Vivendi S.A.) for GBP487 million in cash (approximately US$745 million). Moody's projects Parlophone will generate around $400 million in annual revenue. Subject to certain regulatory approvals, the transaction is expected to close mid-year 2013. The one-notch downgrade on the existing secured credit facilities and secured notes results from the significant increase in the proportion of senior secured debt in WMG's capital structure (expected to rise by about 70%) relative to the unsecured debt (residing at WMG Acquisition Corp. and WMG Holdings Corp.). This reflects the higher loss absorption that this class of debt will sustain in a distressed scenario under Moody's Loss Given Default (LGD) Methodology. The existing credit facilities and secured notes were issued fairly recently in November 2012. Proceeds were used to redeem the $1.25 billion 9.5% senior secured notes at WMG Acquisition Corp. via a tender offer. Pro forma for the incremental term loan and $172 million planned repayment of existing secured debt, Moody's expects WMG's leverage to be about 5.8x net debt to EBITDA on a Moody's adjusted basis as of December 31, 2012 (excluding Parlophone synergies but including Parlophone LTM EBITDA). If Moody's include its conservative estimate for Parlophone's annual EBITDA and expected synergies, and look prospectively after the acquisition closes, WMG's pro forma adjusted net leverage is projected to be about 5.5x (Moody's adjusted) by fiscal year end 2014 (ending September 2014), barring further debt-financed acquisitions. Consequently, over the next 12 to 18 months, Moody's expects WMG's adjusted net leverage will be below the 6x adjusted net debt to EBITDA downgrade trigger. Nonetheless, the transaction does result in delayed deleveraging, with adjusted leverage that is outside the B1 rating range and higher than what Moody's contemplated when ratings were affirmed in October 2012. Prior to the Parlophone transaction, Moody's projected the company's adjusted net leverage would decline to under 5x by fiscal year end 2013 as negative trends in the recorded music industry gradually abate and WMG's revenue and EBITDA benefit from the continued mix shift to higher margin digital services. Despite improving industry fundamentals and additional EBITDA and cost synergies from Parlophone, Moody's now believes WMG will reach under 5x adjusted net leverage during fiscal 2015. This assumes the company refrains from other debt- funded asset purchases. Following the Parlophone purchase, Moody's believes acquisition and event risks will be mitigated and WMG will expand via small tuck-in acquisitions funded with excess cash flow. Despite the presence of a debt-heavy balance sheet, Moody's continues to believe WMG's aggressive capital structure is more than compensated by its leading market position in the recorded music industry, diverse roster of top-selling artists and vast library of best-selling albums, which produce a recurring revenue stream and a sustainable business model that drives the B1 CFR. Moody's expects the Parlophone acquisition will provide WMG with opportunities to achieve integration synergies to expand Parlophone's EBITDA, select "best of breed" operations, strengthen WMG's artist sponsorship, marketing and branding, and enhance the company's analytics talent and asset value. However, Moody's notes that cash levels may be diminished over the rating horizon as WMG spends on integration costs during the next two years to achieve $70 million in annual run-rate synergies. Moody's cautions that if WMG further delays deleveraging such that it expects adjusted net debt to EBITDA will remain near 6x for a sustained period with no clear path towards 4.5x to 5.0x adjusted net leverage, the B1 CFR would likely experience downward pressure. Rating Assigned: Issuer: WMG Acquisition Corp. $820 Million Senior Secured Incremental Term Loan due 2020 -- Ba3 (LGD-3, 33%) Ratings Downgraded: Issuer: WMG Acquisition Corp. $592 Million (originally $600 Million) Senior Secured Term Loan due November 2018, to Ba3 (LGD-3, 33%) from Ba2 (LGD-2, 28%) $500 Million 6% Senior Secured Notes due January 2021, to Ba3 (LGD-3, 33%) from Ba2 (LGD-2, 28%) EUR175 Million 6.25% Senior Secured Notes due January 2021, to Ba3 (LGD-3, 33%) from Ba2 (LGD-2, 28%) Ratings Affirmed: Issuer: WMG Holdings Corp. Corporate Family Rating -- B1 Probability of Default Rating -- B1-PD $150 Million 13.75% Senior Unsecured HoldCo Notes due October 2019 -- B3, LGD assessment revised to (LGD-6, 96%) Issuer: WMG Acquisition Corp. $765 Million 11.50% Senior Unsecured Notes due October 2018 -- B3, LGD assessment revised to (LGD-5, 85%) The assigned rating is subject to review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. Ratings Rationale: The B1 CFR reflects WMG's high financial leverage as measured by pro forma net debt to EBITDA of 5.8x (including Moody's standard adjustments and Parlophone LTM EBITDA but excluding Parlophone synergies) as of December 2012 following the proposed term loan upsizing against the backdrop of weak revenue trends afflicting the global recorded music industry. This is due in part to piracy and lower price points of single track digital downloads versus the traditional sale of an artist's entire album release. The rating further reflects the seasonal and cyclical nature of revenue streams, and low visibility into ultimate results of upcoming release schedules. Lastly, the B1 rating captures the uncertainties related to new strategies that the major industry players are pursuing to adapt to the shift in demand for music content delivery to various forms of evolving digital platforms and to capture the faster growth revenue associated with this transition. Ratings support is derived from WMG's position as the third largest recorded music industry player with an extensive music library and publishing assets which drive recurring revenue streams. Management estimates that only a small percentage of WMG's annual revenue depends on recording artists and songwriters without an established track record, and the bulk of its revenue is generated by proven artists or from its catalog (defined as albums older than 18 months) and thus isolated from the revenue volatility associated with new releases from new artists. Ratings also recognize the inflection point achieved in WMG's recorded music business whereby digital revenue has exceeded traditional physical revenue in the US. Moody's anticipates WMG's revenue and market share performance will reflect the offsetting growth in higher margin digital services revenue, which should result in net debt to EBITDA declining below 5x (Moody's adjusted) during fiscal 2015. Rating Outlook The stable rating outlook reflects Moody's view that past negative trends in the recorded music industry will continue to exhibit stabilization and some growth, and WMG's revenue and market share performance will reflect this tendency as growth in higher margin digital services offsets declines in physical revenue. This should result in deleveraging over the rating horizon. The rating outlook incorporates modestly improving recorded music industry fundamentals as well as changes in the competitive landscape, counterbalanced by WMG's competitive position as a leading music content provider with global diversification and asset value enhancement following the Parlophone acquisition. What Could Change the Rating - Up Ratings could be upgraded if there is evidence of continued revenue stabilization coupled with Moody's expectation of sustained growth in the recorded music business. An upgrade could also be considered if Moody's expects cash balances will remain in-line with forecasted levels and net debt to EBITDA will be sustained below 4.25x (Moody's adjusted) with free cash flow to debt of at least 6% (Moody's adjusted). Moody's would also need assurances that management will maintain operating strategies, exhibit financial discipline and target financial metrics consistent with a higher rating. What Could Change the Rating - Down Ratings could be downgraded if debt-financed acquisitions, competitive pressures or increased artist & repertoire (A&R) investment, negatively impact revenue or EBITDA resulting in WMG's net debt to EBITDA being sustained above 6x (Moody's adjusted), or if heightened capital spending or financial sponsor related actions result in strained liquidity, including free cash flow to debt (Moody's adjusted) falling below the 1% to 2% range. WMG Holdings Corp.'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 WMG Holdings Corp.'s core industry and believes WMG Holdings Corp.'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. With headquarters in New York, NY, WMG Holdings Corp. is a wholly- owned subsidiary of Warner Music Group Corp., a leading music content provider operating domestically (about 37% of revenue) and overseas (63%) (pro forma Parlophone). Recorded music accounts for roughly 84% of revenue and 75% of OIBDA (operating income before depreciation and amortization) while music publishing accounts for roughly 16% and 25%, respectively as of the twelve months ended December 31, 2012 (pro forma Parlophone). WMG's diverse catalog includes 29 of the top 100 best-selling albums and a library of over 1 million copyrights from more than 65,000 songwriters and composers. In July 2011, Access Industries, Inc. acquired WMG in a transaction valued at approximately $3 billion. WMG expects to close the GBP487 million cash acquisition of Parlophone Label Group by mid-year 2013. For the twelve months ended December 31, 2012 WMG's revenue totaled $2.8 billion. YARWAY CORPORATION: Case Summary & Attorneys of Asbestos Claimants ------------------------------------------------------------------ Debtor: Yarway Corporation 1501 Yamato Road Boca Raton, FL 33431 Bankruptcy Case No.: 13-11025 Chapter 11 Petition Date: April 22, 2013 Court: United States Bankruptcy Court District of Delaware (Delaware) Debtor's Counsel: Norman L. Pernick, Esq. J. Kate Stickles, Esq. COLE, SCHOTZ, MEISEL, FORMAN & LEONARD, P.A. 500 Delaware Ave, Suite 1410 Wilmington, DE 19801 Tel: (302) 652-3131 Fax: (302) 652-3117 E-mail: bankruptcy@coleschotz.com kstickles@coleschotz.com Estimated Assets: $100,000,001 to $500,000,000 Estimated Debts: $100,000,001 to $500,000,000 The petition was signed by Kevin Coen, vice president and secretary. The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The Debtor instead filed a list of 20 law firms representing the largest number of asbestos plaintiffs asserting claims against the Debtor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Belluck & Fox, LLP Asbestos personal James Long, Esq. injury 546 Fifth Ave., 4th Flr New York, NY 10036 Brookman, Rosenberg, Asbestor personal Brown & Sandler injury David B. Halpern, Esq. 30 S. Fifteenth St., 17th Floor Philadelphia, PA 19102 Cooney & Conway Asbestos personal William R. Fahey, Esq. injury 120 N. LaSalle St., 30th Floor Chicago, IL 60602 Early, Lucarelli, Asbestos personal Sweeney & Strauss injury Robert Sweeney, Esq. One Century Tower 265 Church St. New Haven, CT 06508-1866 F. Gerald Maples, PC Asbestos personal Canal Place, injury 365 Canal St., Ste 2650 New Orleans, LA 70130 Goldberg, Persky & Asbestos personal White, P.C. injury Joseph J. Cirilano, Esq. 16411 Southfield Rd. Allan Park, MI 48101 Gori, Julian & Asbestos personal Associates, PC injury Randy Gori, Esq. 156 N. Main St. Edwardsville, IL 62025 James R. Hartzog, Esq. Asbestos personal 1502 N. Midway Road injury Clinton, MS 39056 James F. Humphreys & Asbestos personal Associates L.C. injury Bronwyn Rinehart, Esq. United Center, Ste. 800 500 Virginia St. East Charleston, WV 25301 John C. Dearie & Asbestos personal Associates injury John C. Dearie, Esq. 515 Madison Ave. Suite 1118 New York, NY 10022 The Keahey Law Firm Asbestos personal Patrick Keahey, Esq. injury 1005 Downtowner Blvd. Mobile, AL 36609 Mazur & Kittel, PLLC Asbestos personal 30665 Northwestern injury Highway Farmington Hills, MI 48334 Motley Rice LLC Asbestos personal Nathan D. Finch, Esq. injury 1000 Potomac Street Washington, DC 20007 Perry & Sensor Asbestos personal Michael L. Sensor, Esq. injury 704 N. King Street, Suite 560 Wilmington, DE 19801 The Segal Law Firm Asbestos personal Scott S. Segal, Esq. injury 810 Kanawha Blvd. East Charleston, WV 25301 Shrader & Associates, Asbestos personal LLP injury Ross Stomel, Esq. 3900 Essex Lane, Suite 390 Houston, TX 77027 Simmons, Browder, Asbestos personal Gianaris, Angelides & injury Barnerd LLC Nick Angelides One Court Street Alton, IL 62002 Thornton & Naumes LLP Asbestos personal Andrew Wainwright, Esq injury 100 Summer St., 30th Flr Bostonm, MA 02110 Weitz & Luxenberg, PC Asbestos personal Kevin Mulderig, Esq. injury 200 Lake Drive East Suite 205 Cherry Hill, NJ 08002 Wilentz, Goldman & Asbestos personal Spitzer injury Abby Resnick-Parigian 90 Woodbridge Center Dr., Suite 900 Woodbridge, NJ 07095 * NY Top Court Takes Up Post-Judgment Policy Exclusion Bid ---------------------------------------------------------- Pete Brush of BankruptcyLaw360 reported that New York's top court grappled Thursday with whether an insurer that refused to defend a lawyer in an underlying malpractice case should be able, after the lawyer lost a default judgment, to return to court and assert "business enterprise" policy exclusions related to the lawyer's bankrupt real estate concern. According to the report, American Guarantee and Liability Insurance Co. believes it should not be responsible for a $3.1 million judgment awarded to malpractice plaintiffs K2 Investment Group LLC and ATAS Management Group. * Drop in Borrowing Squeezes Banks ---------------------------------- Dan Fitzpatrick and Shayndi Raice, writing for The Wall Street Journal, reported that U.S. companies are pulling back on borrowing, which could put a drag on the limping U.S. economy and make it even harder for banks to break out of their long slump. According to the WSJ report, outstanding loans by the biggest banks to U.S. companies declined 9% in the first two weeks of April compared with the end of March, according to Federal Reserve data. The slip followed a 2.7% rise in the first quarter, the smallest quarterly gain in two years. WSJ related that bankers and corporate executives said the reluctance is a sign of uncertainty about rising health-care costs, fear of another economic downturn and a brutal winter in the Midwest that delayed new investment. Companies also rushed to borrow and spend late last year ahead of anticipated tax increases. Business owners "feel very, very hesitant to invest," and the economy is "struggling to get solid footing," but "we didn't expect the wall we hit," BB&T Corp. Chairman and Chief Executive Kelly King told WSJ. Outstanding business loans by the Winston- Salem, N.C., bank, the nation's 12th-largest by assets, were flat in the first quarter. "I think all of us are trying to figure out what happened." Some executives said they are focusing on bolstering their cash hoards, WSJ further related. R. Neil Williams, chief finance officer of financial-software provider Intuit Inc., said during the company's first-quarter-earnings call with analysts that "the plan going into this year was to let our cash position build up a bit from where we ended last year," after paying down half of the company's long-term debt in 2012. * SEC Aims to Protect Investors from Fraud under New Law -------------------------------------------------------- Dina ElBoghdady, writing for The Washington Post, reported that the rules aren't even in place yet, but allegations of fraud are already flying. The Securities and Exchange Commission is crafting rules to implement a new law that makes it easier for private firms to raise money but it has been struggling over how to do so in a way that protects investors from fraud, according to the Post. On Thursday, the agency criticized a Washington firm and its owner, Daniel F. Peterson, for allegedly using the new law to lure investors into forking over cash for a phony deal that promised what they called "fictitious" returns, the Post related. Peterson denied the allegations. According to the Post, in a civil complaint, the SEC accused Peterson of telling investors that the law -- known as the JOBS Act -- would enable him to raise billions of dollars from the general public and generate 10-year returns of up to 1,300 percent for early investors but Peterson and his company, USA Real Estate Fund 1, have no guaranteed investment product and no affiliation with the two Wall Street firms that he said he partnered with for future offerings of the company's stock, the SEC said. The complaint, filed in federal court in Spokane, Wash., marks the first time the agency has accused someone of referring to the JOBS Act as part of a fraudulent scheme, according to the SEC, the report related. * Hundreds in Chicago Using Bankruptcy Filings to Avoid Car Fines ----------------------------------------------------------------- The Associated Press reported that federal authorities say hundreds of people appear to be using phony bankruptcy filings in Chicago to avoid paying full fines on their impounded cars. According to the AP report, the allegations arose in a complaint against one Chicago man arrested on Thursday for allegedly accepting $600 to assist filing a false bankruptcy case. He's charged with bankruptcy fraud. The U.S. Attorney's Office announced Daniel Rankins' arrest, AP said. The office says authorities suspect at least 1,000 people have made similarly fraudulent bankruptcy filings. The bankruptcy filings weren't followed through on but apparently let many people get their cars from impounds without paying large fines, the AP report related. It wasn't immediately clear if Rankins' had an attorney, AP said. He's due to make an initial appearance in U.S. District Court in Chicago later Thursday. * Moody's Says Risks Remain in Canadian Life Insurance Sector ------------------------------------------------------------- Moody's expectation of modestly improving economic fundamentals, in conjunction with a favorable industry structure, recent hedging of market exposures and realignment of product offerings supports a stable outlook for the Canadian life insurance industry, says Moody's Investors Service in its latest industry outlook "Canadian Life Insurance Industry Outlook 2013." Moody's industry outlooks reflect the rating agency's expectations for fundamental business conditions in the industry over the next 12 to 18 months. "Still, downside risks persist, including persistently low interest rates, continued weakness of the U.S. economic recovery, the ongoing sovereign banking crisis in the Euro area, and a worsening slowdown in emerging markets," said David Beattie, a Moody's Vice President -- Senior Credit Officer. Key drivers for the Canadian life insurance industry in 2013 include the low interest rate environment's impact on profitability. Moody's expects that long-term interest rates in Canada will rise gradually over the next few years, providing some relief to spread compression and earnings pressure, although the risk of a protracted period of low interest rates remains. Recent actions taken by insurers to reposition their product offerings will continue to pay off, says Moody's, as market risk is increasingly transferred to clients. High quality, diversified investment portfolios have allowed Canadian insurers to fare better than U.S. peers in recent times. As the Canadian economy continues to recover at a modest pace, credit provisions and impairments are expected to remain low, despite some evidence of marginally increased investment risk appetite. Moody's expects the economic recovery in Canada to remain modest; the rating agency's central scenario predicts 1.5% to 2.5% GDP growth, although certain domestic and global macro-economic risks to that outlook exist. Still, Canadian life insurers' sensitivity to equity capital markets is an important concern, says Moody's. This sensitivity persists in certain legacy blocks of business at Canadian insurers despite costly hedging programs, says the rating agency. * Small Hospitals Take Bulk of Rating Downgrades in 1st Quarter --------------------------------------------------------------- During the first quarter of 2013 Moody's Investors Service downgraded six ratings in the not-for-profit healthcare sector and upgraded three ratings, detailed in the report "US Not-For-Profit Healthcare Quarterly Ratings: Small Hospitals Dominate Downgrades in First Quarter 2013." Five of the six downgraded ratings were on smaller hospitals with less than $500 million in revenues. "Almost all rating downgrades were small-sized providers, continuing a trend we have seen for several years. Small hospitals are unable to absorb the reimbursement pressures facing the industry," says Lisa Goldstein, Associate Managing Director. "Two of the three upgraded providers have over $500 million in revenues and all demonstrated multiple years of improved financial performance reflecting growing volume trends and dominant local market positions." Moody's views the smaller healthcare providers as burdened with several disadvantages relative to their larger peers, including limited leverage during negotiations with commercial payers and vendors, lack of economies of scale, and over-reliance on a few key physicians. Looking ahead, Moody's expects more downgrades than upgrades in the second quarter, given that there are already three hospitals currently under review for downgrade. During the first quarter Moody's downgraded $988 million in not- for-profit healthcare debt and upgraded $658.1 million, for a ratio of 1.5 to 1. The ratio for downgraded issuers versus upgraded issuers during the quarter was 2 to 1 ratio -- the same ratio as in the fourth quarter of 2012, when there were 10 downgrades and five upgrades. The nine rating changes in the first quarter of 2013 was a decline from the 22 rating changes during the first quarter of 2012, when there was an even split between downgrades and upgrades. During the first quarter of 2013, Moody's also affirmed 55 ratings, representing 86% of all rating activity and affecting approximately $25.3 billion in debt. * High-Cost Loans Seeing Tremendous Growth ------------------------------------------ Peter Whoriskey, writing for The Washington Post, reported that the business of payday loans, pawn shops and other high-cost methods of financing has experienced tremendous growth over the past two decades, and in recent years, nearly one in four Americans have used them, according to a new paper from the National Bureau of Economic Research. According to the Post, the rise of this kind of borrowing, often marketed as a means of making it to the next paycheck, reflects the needs of a population struggling to make ends meet. Given the price of such borrowing, it may also be a measure of desperation: The financing fees on the loans are often very high, with annualized percentage rates on common payday loans reaching more than 300 percent, according to the Consumer Financial Protection Bureau, the Post related. In the agency's research, the median amount borrowed was $350. "This method of borrowing cannot be considered a 'fringe' behavior limited to a small segment of the population," Annamaria Lusardi, director of the Global Center for Financial Literacy at George Washington University, who wrote the paper with colleague Carlo de Bassa Scheresberg, told the Post. "It is firmly rooted in the American financial system. The solidly middle class are using these methods of borrowing." The research paper comes as U.S. regulators are preparing to issue new rules for banks offering the short-term, high-interest loans tied to direct deposits of salary or government benefits, the Post noted. The proposed regulation reportedly would restrict borrowers from taking more than one such loan a month. * Carestream Bidding War Down to Just Two ----------------------------------------- Jake Simpson of BankruptcyLaw360 reported that the bidding war for Onex Corp.'s Carestream Health Inc. is down to just Bain Capital LLC and Thomas H. Lee Partners LP, while leading energy-focused private equity firm First Reserve Corp. plans a second global infrastructure fund. According to the report, the potential bidders for Onex-owned Carestream Health Inc. have dwindled to just Bain Capital and Lee Partners, several sources told Reuters on Friday. Onex had hoped to bring in up to $3.5 billion for the medical imaging company, but that price has been thrown into doubt. * S&P Dealt a Setback in Connecticut Case over Credit Ratings ------------------------------------------------------------- Jonathan Stempel and Aruna Viswanatha, writing for Reuters, reported that a federal judge handed a legal defeat to Standard & Poor's, ruling that a lawsuit in which Connecticut accused it of fraudulently inflating credit ratings to win business should be moved back to the state court where it began. According to the Reuters report, in a decision late Wednesday, U.S. District Judge Stefan Underhill in Bridgeport, Connecticut, said S&P and its parent, McGraw-Hill Cos (MHP.N), waited too long to move the March 2010 lawsuit by Connecticut Attorney General George Jepsen to federal court from state court. He did not rule on the case's merits. Reuters related that the decision came two days after the largest U.S. credit rating agency asked a federal judge in Los Angeles to dismiss the U.S. Department of Justice's $5 billion civil fraud lawsuit filed in February over its ratings. In that case, the government said S&P knowingly inflated ratings of risky mortgages and other securities, fueling demand from investors who believed the ratings were objective and helping trigger the 2008 financial crisis. S&P, according to Reuters, had been seeking to move lawsuits by 15 U.S. states and the District of Columbia to federal court. On May 30 it is expected to ask the U.S. Judicial Panel on Multidistrict Litigation to consolidate litigation before a single federal judge. Combining the cases could streamline the litigation, avoid conflicting rulings, and help S&P obtain better results than if it were forced to defend against claims under state consumer laws, where burdens of proof can be lower. A hearing is set for May 20 before U.S. District Judge David Carter in Los Angeles, Reuters said. The case is Connecticut v. McGraw-Hill Cos et al, U.S. District Court, District of Connecticut, No. 13-00311. * Gordian Group Celebrating 25th Anniversary -------------------------------------------- This year, Gordian Group is celebrating its 25th anniversary. "We would like to thank our 'friends and family' for supporting us over the years and helping us reach this milestone. While our business continues to evolve into new practice areas, we maintain the core tenets that have been the backbone of our success: unconflicted advice delivered by dedicated senior leadership," Peter S. Kaufman-- psk@gordiangroup.com -- the firm's president, said in a statement. Gordian continues to be recognized as leaders in the bankruptcy and restructuring field. In March, the firm's restructuring of Jobson Medical Holdings was honored at the M&A Advisor Turnaround Awards Gala in Palm Beach, Florida. Turnarounds & Workouts selected Peter Kaufman as one of their "People to Watch - 2013" finalists, and Gordian was again ranked within the top 10 in The Deal's latest League Tables top Investment Banks (with three of our senior partners in the top 8 Investment Bankers). "We are very proud of these accomplishments and continued success," the firm said. "Our work on Jobson is illustrative of the tremendous successes we have been able to achieve on behalf of private equity clients and their portfolio companies over the last several years. We have also continued to build up our securitization practice (including work on Ambac and MBIA), becoming one of the leading investment banks working in this area. And more recently, we have developed a focus on union representations, having represented the Transport Workers Union in the AMR bankruptcy and the Bakers Union during a portion of the Hostess Brands' proceedings." "In addition, we are proud to announce our newest partnership, Gordian-Dynamis Solutions, a joint venture formed by Gordian and Dynamis Advisors to provide restructuring services to the health care and education sectors. On this front, the joint venture was recently engaged to represent Interfaith Medical Center during its bankruptcy. "On the asset management front, Bacchus Capital Partners, the affiliate of Gordian Group which loans to and invests in wineries and wine-related entities has celebrated much success. The fund now has eight portfolio companies, and two of our investments in Qup� and Maritime Wine Trading Collective were both recognized by Dow Jones as private equity deals of the month, for April 2011 and February 2013 respectively. The firm may be reached at: Peter S. Kaufman President Henry F. Owsley Chief Executive Officer GORDIAN GROUP 950 Third Avenue, 17th Floor New York, NY 10022 Tel: 212-486-3600 Fax: 212-486 E-mail: psk@gordiangroup.com hfo@gordiangroup.com * BOND PRICING -- For Week From April 22 to 26, 2013 ---------------------------------------------------- Company Coupon Maturity Bid Price ------- ------ -------- --------- AES EASTERN ENER 9.000 1/2/2017 1.750 AES EASTERN ENER 9.670 1/2/2029 4.125 AFFINION GROUP 11.625 11/15/2015 60.337 AGY HOLDING COR 11.000 11/15/2014 58.100 AHERN RENTALS 9.250 8/15/2013 79.625 ALBERTSON'S INC 7.250 5/1/2013 99.517 ALION SCIENCE 10.250 2/1/2015 59.468 AMBAC INC 6.150 2/7/2087 15.375 AMER EXPRESS CR 5.875 5/2/2013 100.000 ATP OIL & GAS 11.875 5/1/2015 3.500 ATP OIL & GAS 11.875 5/1/2015 3.500 ATP OIL & GAS 11.875 5/1/2015 3.500 BUFFALO THUNDER 9.375 12/15/2014 27.000 CENGAGE LEARN 12.000 6/30/2019 21.750 CENGAGE LEARNING 13.750 7/15/2015 20.375 CHAMPION ENTERPR 2.750 11/1/2037 0.375 CIENA CORP 0.250 5/1/2013 99.250 DELTA AIR 1993A1 9.875 4/30/2049 20.875 DOWNEY FINANCIAL 6.500 7/1/2014 64.000 DYN-RSTN/DNKM PT 7.670 11/8/2016 4.500 EASTMAN KODAK CO 7.000 4/1/2017 12.853 EASTMAN KODAK CO 9.200 6/1/2021 10.625 EASTMAN KODAK CO 9.950 7/1/2018 12.750 EDISON MISSION 7.500 6/15/2013 55.000 ELEC DATA SYSTEM 3.875 7/15/2023 97.000 FAIRPOINT COMMUN 13.125 4/1/2018 1.000 FAIRPOINT COMMUN 13.125 4/1/2018 1.000 FAIRPOINT COMMUN 13.125 4/2/2018 1.040 FIBERTOWER CORP 9.000 1/1/2016 6.375 FIFTH THIRD BANK 6.250 5/1/2013 100.578 GEN ELEC CAP CRP 4.800 5/1/2013 100.064 GEOKINETICS HLDG 9.750 12/15/2014 52.125 GEOKINETICS HLDG 9.750 12/15/2014 52.750 GLB AVTN HLDG IN 14.000 8/15/2013 31.875 GMX RESOURCES 4.500 5/1/2015 7.250 GMX RESOURCES 9.000 3/2/2018 19.050 HAWKER BEECHCRAF 8.500 4/1/2015 6.000 HAWKER BEECHCRAF 8.875 4/1/2015 1.750 HORIZON LINES 6.000 4/15/2017 30.480 INTL LEASE FIN 5.875 5/1/2013 100.000 JAMES RIVER COAL 3.125 3/15/2018 22.000 JAMES RIVER COAL 4.500 12/1/2015 26.575 JPMORGAN CHASE 4.750 5/1/2013 100.011 LAS VEGAS MONO 5.500 7/15/2019 20.000 LBI MEDIA INC 8.500 8/1/2017 31.625 LEHMAN BROS HLDG 0.250 12/12/2013 20.250 LEHMAN BROS HLDG 0.250 1/26/2014 20.250 LEHMAN BROS HLDG 1.000 10/17/2013 20.250 LEHMAN BROS HLDG 1.000 3/29/2014 20.250 LEHMAN BROS HLDG 1.000 8/17/2014 20.250 LEHMAN BROS HLDG 1.000 8/17/2014 20.250 LEHMAN BROS HLDG 1.250 2/6/2014 20.250 MF GLOBAL LTD 9.000 6/20/2038 70.500 OVERSEAS SHIPHLD 8.750 12/1/2013 79.000 PENSON WORLDWIDE 12.500 5/15/2017 20.250 PENSON WORLDWIDE 12.500 5/15/2017 20.250 PLATINUM ENERGY 14.250 3/1/2015 43.750 PMI CAPITAL I 8.309 2/1/2027 0.625 PMI GROUP INC 6.000 9/15/2016 26.000 POWERWAVE TECH 1.875 11/15/2024 0.750 POWERWAVE TECH 1.875 11/15/2024 0.750 POWERWAVE TECH 3.875 10/1/2027 0.750 POWERWAVE TECH 3.875 10/1/2027 1.000 RESIDENTIAL CAP 6.875 6/30/2015 30.500 SAVIENT PHARMA 4.750 2/1/2018 20.000 SCHOOL SPECIALTY 3.750 11/30/2026 44.500 TERRESTAR NETWOR 6.500 6/15/2014 10.000 TEXAS COMP/TCEH 10.250 11/1/2015 10.500 TEXAS COMP/TCEH 10.250 11/1/2015 10.625 TEXAS COMP/TCEH 10.250 11/1/2015 10.500 TEXAS COMP/TCEH 10.500 11/1/2016 9.750 TEXAS COMP/TCEH 10.500 11/1/2016 9.625 TEXAS COMP/TCEH 15.000 4/1/2021 28.750 TEXAS COMP/TCEH 15.000 4/1/2021 30.000 TEXFI INDUSTRIES 8.750 8/1/1999 1.000 THQ INC 5.000 8/15/2014 46.500 TL ACQUISITIONS 10.500 1/15/2015 19.875 TL ACQUISITIONS 10.500 1/15/2015 19.875 USEC INC 3.000 10/1/2014 24.000 WAL-MART STORES 4.550 5/1/2013 100.255 WCI COMMUNITIES 4.000 8/5/2023 0.375 WCI COMMUNITIES 4.000 8/5/2023 0.375 WCI COMMUNITIES 6.625 3/15/2015 0.500 ********* 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 ***