TCR_Public/050609.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

           Thursday, June 9, 2005, Vol. 9, No. 135

                          Headlines

A-B SECURITIES: Fitch Assigns Low-B Ratings to $23M Class M Certs.
ACCLAIM ENT: Trustee Wants to Sell Comic Book Assets to Kothari
ADVANCE AUTO: Moody's Reviews Ba2 Ratings for Possible Upgrade
AMERICAN AIRLINES: Asks Senate to Pass Pension Plan Legislation
ARGONAUT GROUP: Good Performance Prompts S&P to Lift Ratings

ARMSTRONG WORLD: Files 3rd Cir. Appeal Brief on Plan Confirmation
ASSET BACKED: Sufficient Credit Support Cues S&P to Hold Ratings
ATA AIRLINES: Gets Court Nod to Hire Adelphi as Investment Banker
BEAR STEARNS: Litigation Costs Cue S&P to Cut Ratings on 3 Classes
BOB'S DISCOUNT: Case Summary & 20 Largest Unsecured Creditors

BORDEN CHEMICAL: Merges Two Units to Form Hexion Specialty
BORDEN CHEMICAL: S&P Confirms B+ Rating After Merger Completed
BRADLEY PHARMACEUTICALS: Defaults on Convertible Sr. Sub. Notes
BRIDGEPOINT TECHNICAL: Committee Balks at Chapter 11 Plan
BUILDERS PLUMBING: Chapter 7 Trustee Hires Shaw as Special Counsel

CARRINGTON MORTGAGE: Fitch Rates $21 Million Private Class at BB+
CASCADIA LIMITED: Fitch Rates $300M Variable-Rate Notes at BB
CATHAY GENERAL: Fitch Places BB+ Rating on Long-Term Senior Notes
CATHOLIC CHURCH: Court Denies Portland's Request to Hire Triboro
CHESAPEAKE ENERGY: Buying Back 8.125% & 9% Senior Notes

CHESAPEAKE ENERGY: Fitch Rates Senior Unsecured Notes at BB
CITIGROUP COMMERCIAL: S&P Rates Seven Cert. Classes at Low-B
CRB INVESTMENTS: Case Summary & 20 Largest Unsecured Creditors
CROWN HOLDINGS: Moody's Rates $500 Mil. First Lien Loan at Ba3
DELTA AIR: CEO Grinstein Urges Senate to Pass Pension Funding Law

DEVON MOBILE: Judge Walsh Closes Chapter 11 Cases
DIGITAL VIDEO: Ex-CEO Mali Kuo Returns to Lead Company
DOCTORS HOSPITAL: Has Until September 5 to Decide on Leases
DONNKENNY INC: Court Confirms Second Amended Chapter 11 Plan
DPAC TECHNOLOGIES: Posts $5.7 Million Net Loss in First Quarter

FEDERAL-MOGUL: U.K. Court Not Prepared to Terminate Protocol
FIRST UNION: Fitch Affirms Low-B Ratings on $15.5M Mortgage Certs.
FLINTKOTE CO: Four Claimants Want Administrative Claims Paid
GABLES RESIDENTIAL: Moody's Reviews Ratings for Possible Downgrade
GE BUSINESS: Fitch Assigns BB Rating to Class D Certificates

GENERAL MOTORS: CEO Reveals Plan to Cut 25,000 Jobs by 2008
GREAT NORTHERN: Hires Evan Migdail as Tax Counsel
HERCULES OFFSHORE: S&P Rates Proposed $130 Mil. Term Loan at B-
HIGH VOLTAGE: Ch. 11 Trustee Taps Houlihan Lokey as Fin'l Advisor
IRWIN WHOLE: Fitch Puts BB+ Rating on $1.7M Class 2B-1 Certs.

ISTAR ASSET: Prepayment Cues Fitch to Lift Ratings on 11 Classes
KEY ENERGY: Trustee Issues Default Notice on Reporting Covenants
MAGRUDER COLOR: Wants to Hire Lowenstein Sandler as Bankr. Counsel
MAGRUDER COLOR: Wants to Hire San Filippo as Financial Advisors
MEDIANEWS GROUP: Good Financial Profile Cues S&P's Stable Outlook

MICROTEC ENT: March 31 Balance Sheet Upside-Down by C$937,000
MIDLAND REALTY: Fitch Lifts Rating on $7.7M Class K Certs. to BB
MIRANT CORP: Court Okays $85 Million Wrightsville Power Plant Sale
MIRANT CORP: Objects to Southern Company's $48,983,612 Claim
MIRANT CORP: Deutsche Bank Wants Americas Energy Claim Estimated

NATIONAL ENERGY: ET Debtors' Amended Liquidation Plan Takes Effect
NBTY INC: $115M Solgar Vitamin Purchase Spurs S&P's Negative Watch
NEW WORLD: Has Until December 30 to Decide on Leases
O-CEDAR HOLDINGS: Ch. 7 Trustee Taps Saul Ewing as Special Counsel
ORGANIZED LIVING: Asset Disposition to Provide Advice on Property

OWENS CORNING: Wants to Hire Sidley Austin as Bankr. Co-Counsel
PENINSULA HOLDING: Wants to Hire Charlie Johnson as Bankr. Counsel
PROXIM CORP: Has Until November 30 to Comply with Nasdaq Rule
PRUDENTIAL SECURITIES: Fitch Lifts Ratings on $9.3M Certs. to BB-
QUIGLEY COMPANY: Foresight Group Approved as Valuation Consultants

QWEST CORP: Fitch May Rate Proposed Senior Notes Offering at BB
QWEST CORP: Moody's Rates Proposed Senior Unsecured Notes at Ba3
QWEST COMMS: S&P Puts Low-B Ratings on Proposed $1.25 Bil. Notes
RESOLUTION PERFORMANCE: Completes Merger with Borden and RSP
RESOLUTION PERFORMANCE: Merger Close Cues S&P to Withdraw Ratings

REXAIR HOLDINGS: Moody's Rates $125MM Sr. Secured Term Loan at B1
SANTA ROSA: Moody's Affirms B1 Rating on $95MM Revenue Bonds
SEARS HOLDINGS: Posts $9 Million Net Loss in First Quarter 2005
SILGAN HOLDINGS: S&P Rates Proposed $1B Sr. Sec. Facilities at BB
SYNAGRO TECH: Gets Tenders from Holders of $92.4 Million Notes

TENASKA ALABAMA: Moody's Rates $360 Mil. Senior Sec. Bonds at B1
TENASKA ALABAMA: S&P Rates Proposed $359.4M Sr. Sec. Bonds at B+
TWENTIETH CENTURY: Case Summary & 20 Largest Unsecured Creditors
UNITED PRODUCERS: Has Until August 27 to Decide on Leases
URS CORP: Equity Offering Prompts S&P's Watch Positive

US AIRWAYS: Amadeus Global Holds Allowed $1,565,533 Admin. Claim
USGEN NEW ENGLAND: 2nd Amended Liquidation Plan Takes Effect
VALLEY MEDIA: Inks $65,000 Settlement Pact with TeeVee Toons
VENTAS INC: Completes $1.2 Billion Provident Trust Acquisition
W.R. GRACE: Senate Panel Rejects Cleanup Claims in S. 852

W.R. GRACE: New Jersey Attorney General Sues for False Reports
WESTCHESTER COUNTY: Moody's Pares Sr. Debt Rating to Ba2 from Ba1
WESTPOINT STEVENS: Court Approves 7th Amendment to DIP Financing
WINN-DIXIE: Retirees Want Additional Committee Appointed
WINN-DIXIE: Heinz & Robinson Group Want to Resolve PACA Claims

WINN-DIXIE: UST Withdraws Objection to Smith Hulsey Engagement

* Mark Heilbrun Joins Jenner & Block's Litigation Practice
* Paul R. Ferretti Joins Morgan Joseph's Equity Research Dept.
* Smart and Associates Adds Six Attorneys in Chicago Office


                          *********

A-B SECURITIES: Fitch Assigns Low-B Ratings to $23M Class M Certs.
------------------------------------------------------------------
Fitch has rated the Asset-Backed Securities Corporation Home
Equity Loan Trust, series WMC 2005-HE5:

     -- $844.35 million classes A1, A1A, A2, and A2A 'AAA';
     -- $72.82 million classes M-1 and M-2 'AA+';
     -- $21.01 million class M-3 'AA';
     -- $19.40 million class M-4 'AA-';
     -- $16.70 million class M-5 'A+';
     -- $17.78 million class M-6 'A';
     -- $14.55 million class M-7 'A-';
     -- $13.47 million class M-8 'BBB+'
     -- $10.78 million class M-9 'BBB';
     -- $7 million class M-10 'BBB-';
     -- $10.78 million class M-11 'BB+';
     -- $11.85 million class M-12 'BB'.

The 'AAA' rating on the senior certificates reflects the 21.65%
total credit enhancement provided by the 3.60% class M-1, the
3.25% class M-2, the 1.95% class M-3, the 1.80% class M-4, the
1.55% class M-5, the 1.65% class M-6, the 1.35% class M-7, the
1.25% class M-8, the 1.00% class M-9, the 0.65% class M-10, the
1.00% non-offered class M-11, the 1.10% non-offered class M-12,
and the 1.50% initial and target overcollateralization.

All certificates have the benefit of monthly excess cash flow to
absorb losses.  In addition, the ratings reflect the integrity of
the transaction's legal structure as well as the primary servicing
capabilities of Countrywide Home Loans Servicing LP.  Wells Fargo
Bank, N.A. will act as Trustee.

Two collateral groups support the certificates.  The group I
mortgage pool consists of adjustable-rate and fixed-rate, first
and second lien mortgage loans that may or may not conform to
Fannie Mae and Freddie Mac loan balances, and has a cut-off date
pool balance of $592,506,187.  Approximately 22.51% of the
mortgage loans are fixed-rate, 77.49% are adjustable-rate, and
16.75% are second lien.  The weighted average loan rate is
approximately 7.247%.  The weighted average remaining term to
maturity is 327 months.  The average principal balance of the
loans is approximately $181,695.  The weighted average loan to
value of the first and second lien mortgage loans is approximately
81.12% and 99.3%, respectively.  The properties are primarily
located in California (60.63%), New York (5.71%) and Virginia
(4.05%).

The group II mortgage pool consists of adjustable-rate and fixed-
rate, first and second lien mortgage loans that conform to Fannie
Mae and Freddie Mac loan balances, and has a cut-off date pool
balance of $485,160,533.  Approximately 12.44% of the mortgage
loans are fixed-rate, 87.56% are adjustable-rate, and 1.05% are
second lien.  The weighted average loan rate is approximately
6.788%.  The WAM is 354 months.  The average principal balance of
the loans is approximately $198,755.  The weighted average LTVs of
the first lien and second lien mortgage loans are approximately
80.53% and 99.67%, respectively.  The properties are primarily
located in California (38.07%), New York (7.50%) and Florida
(6.46%).

All of the mortgage loans were purchased by an affiliate of the
depositor from WMC Mortgage Corporation.  WMC is a mortgage
banking company incorporated in the State of California.  WMC was
owned by a subsidiary of Weyerhaeuser Company until May 1997 when
it was sold to WMC Finance Co., a company owned principally by
affiliates of Apollo Management, L.P., a private investment firm.
On June 14, 2004, GE Consumer Finance acquired WMC Finance Co.  As
of March 2000, WMC changed its business model to underwrite and
process 100% of its loans on the Internet via 'WMC Direct'.

For federal income tax purposes, multiple real estate mortgage
investment conduit elections will be made with respect to the
trust estate.


ACCLAIM ENT: Trustee Wants to Sell Comic Book Assets to Kothari
---------------------------------------------------------------
Allan B. Mendelsohn, Esq., the chapter 7 trustee overseeing the
liquidation of Acclaim Entertainment, Inc., asks the U.S.
Bankruptcy Court for the Eastern District of New York for
permission to sell the estate's comic book assets (characters,
publications, copyrights, trademarks, intellectual property) to
the Kothari Group for $720,000.

As previously reported, at an auction approved by the Bankruptcy
Court, John Tadeo submitted the highest bid for the assets at
$925,000.  The Kothari Group was the second highest bidder.

Mr. Tadeo changed his mind and advised the Trustee he no longer
wished to proceed with the sale.  Mr. Tadeo, the Trustee says,
simply walked away from the transaction.

The Trustee then negotiated with the second highest bidder for the
purchase of the comic book assets.  Kothari asked the Trustee to
lower the purchase price of the assets to $720,000.  The Trustee
consented.  Other than the price reduction, all the other
provisions of the original Asset Purchase Agreement approved by
the Court remain the same.

Salvatore LaMonica, Esq., at La Monica Herbst & Maniscalo, LLP,
represents the chapter 7 trustee.

David Bass, Esq., at Herrick Feinstien, LLP represents the Kothari
Group.

Headquartered in Glen Cove, New York, Acclaim Entertainment was a
worldwide developer, publisher and mass marketer of software for
use with interactive entertainment game consoles including those
manufactured by Nintendo, Sony Computer Entertainment and
Microsoft Corporation as well as personal computer hardware
systems.  The Company filed a chapter 7 petition on Sept. 1, 2004
(Bankr. E.D.N.Y. Case No. 04-85595).  Jeff J. Friedman, Esq., at
Katten Muchin Zavis Rosenman represents the Debtor.  Allan B.
Mendelsohn, Esq., serves as the chapter 7 Trustee.  When the
Company filed for bankruptcy, it listed $47,338,000 in total
assets and $145,321,000 in total debts.


ADVANCE AUTO: Moody's Reviews Ba2 Ratings for Possible Upgrade
--------------------------------------------------------------
Moody's Investors Service placed all long-term ratings of Advance
Auto Parts, Inc., on review for possible upgrade (senior implied
Ba2), and upgraded the company's speculative grade liquidity
rating to SGL-1.

Ratings placed on review for possible upgrade are:

* Advance Auto Parts, Inc.

  -- Senior implied rating at Ba2, and

  -- Senior unsecured issuer rating at B1.

* Advance Stores, Inc.

  -- $200 million senior secured revolving credit facility
     maturing September 2009 at Ba2;

  -- $200 million senior secured Term Loan A maturing June 2009 at
     Ba2;

  -- $170 million senior secured Term Loan B maturing September
     2010 at Ba2, and

  -- $100 million senior secured delayed draw Term Loan maturing
     September 2010.

Rating upgraded is:

   -- Speculative grade liquidity rating from SGL-2 to SGL-1.

The review of Advance's long-term ratings reflects the continued
improvements in operating performance, culminating in significant
improvements in debt protection measures as a result of improved
operating performance.  For the fiscal year-ended January 1, 2005,
Advance generated revenues of $3.77 billion, reflecting a year-
over-year increase of 7.9%, gross profit margin of 46.5%, an
increase of 60 basis points, and EBITDA margin of 11.43%, an
improvement of 30 basis points.  For the last twelve months ended
April 2005, Total Debt/EBITDA improved to 1.24x, and Adjusted
Debt/EBITDAR also improved to 3.10x.

Moody's review will focus on

  1) potential for sustainability of the improvement in metrics,

  2) smoothness of the transition in executive management,

  3) performance trends for the intermediate term, and

  4) prospects for future financial policy impact on credit
     metrics.

Particular attention will be paid to gross and operating margins;
we regard the continued upward trajectory of these margins as a
key rating driver.

The upgrade in the speculative grade liquidity rating to SGL-1
reflects the expectation that Advance Auto Parts, Inc. will
maintain very good liquidity, and that its internally generated
cash flow and cash on hand will be sufficient to fund its working
capital, capital expenditure and debt amortization requirements
for the next 12 -- 18 months.  The company's $200 million
revolving credit facility is expected to remain largely undrawn
and to be used only for seasonal needs and letter of credit
support.  Additionally, Moody's expects that the company will be
able to comply very comfortably with the covenants in its bank
facilities.

Advance Auto Parts, Inc., is headquartered in Roanoke, Virginia,
and is the parent company of Advance Stores Company, Inc., which
operates the second largest U.S. auto parts retail chain with
2,652 stores as of fiscal year ended January 1, 2005.  Sales for
the year then ended were approximately $3.8 billion.


AMERICAN AIRLINES: Asks Senate to Pass Pension Plan Legislation
---------------------------------------------------------------
American Airlines, on behalf of its employees, and the presidents
of the three labor unions issued a letter to the Finance Committee
on Pension Plan Legislation asking Senate to pass a legislation
that would allow them to maintain their defined benefit pension
plans.

The three unions represent AA pilots, flight attendants, aircraft
maintenance technicians, plant maintenance employees, fleet
service employees, ground service employees, technical
specialists, flight dispatchers, stock clerks, flight simulator
technicians, ground school, flight simulator and pilot simulator
instructors at American.

In the letter, American Airlines said:

   June 7, 2005

   Honorable Charles Grassley
   Honorable Max Baucus
   United States Senate
   Committee on Finance
   Washington, DC

   Dear Chairman Grassley and Senator Baucus:

   Today the Finance Committee is holding a hearing on the crisis
   of pensions in the airline industry. Although American Airlines
   and its employees were not asked to appear as witnesses, we are
   keenly interested in the issue and are preparing a written
   statement that we respectfully ask to be entered into the
   record.

   While the media has focused almost exclusively on the crisis
   precipitated by airlines abandoning or freezing pension plans,
   American and its employees are following a different path. We
   are, together, working hard to maintain our defined benefit
   pension plans. We urge the Committee to enact legislation that
   would give us the chance to do so.

   To be clear, we understand the desire other companies have for
   legislation that allows companies, through the collective
   bargaining process, to freeze defined benefit plans and convert
   to other types of plans. This is a useful tool to have if
   necessary to prevent more drastic results. But we need
   legislation that does not require us to freeze our pension
   plans.

   We hope not to resort to a freeze or to the termination of our
   pension plans. We need the help of Congress to enact
   legislation that provides a realistic and stable interest rate
   for calculating full funding and a reasonable period of time to
   amortize the amount necessary to achieve full funding -- all
   without limiting lump sums and other benefits of our plan
   participants. American's defined benefit plans are the best
   funded in the airline industry. Our plans have been managed
   prudently over the years, earning an average return of well
   over 10 percent. Moreover, we have a history of steadily
   contributing to our plans even in the years when cash was very
   short. In the last two years we have contributed over $599
   million dollars to our plans.

   We fear that in the midst of concern about the potential
   default of airline plans, Congress will take actions that would
   inadvertently cause our plans to become just as vulnerable as
   those currently in trouble. In particular, any legislation that
   would place greater funding burdens on companies with "below
   investment grade" credit ratings could have the perverse effect
   of forcing us to abandon our plans. We do not oppose setting
   different premium rates for companies with more risk reflected
   in their pension plans, but the measurement should be the
   strength of the plan, not the strength of the sponsor. We
   strongly oppose different funding rules based on a company's
   credit ratings.

   With the help of Congress, we at American have a very realistic
   chance of returning to our historic status of fully funded
   defined benefit plans. We will submit a full statement for the
   record presenting in more detail our legislative and regulatory
   objectives.

   Sincerely yours,

   Captain Ralph Hunter                Tommie L. Hutto-Blake
   President                           President
   Allied Pilots Association           Association of Professional
                                       Flight Attendants

   James C. Little                     Gerard J. Arpey
   Int'l. Executive Vice President     Chairman  & CEO
   Director Air Transport Division     American Airlines, Inc.
   Transport Workers Union

                           About APA

Founded in 1963, APA -- http://www.alliedpilots.org/-- is
headquartered in Fort Worth, Texas.  The APA currently represents
over 13,000 pilots.  There are currently 2,819 American Airlines
pilots on furlough.  The furloughs began shortly after the
September 11, 2001 attacks.  Also, several hundred American
Airlines pilots are on full-time military leave of absence serving
in the armed forces.

                           About APFA

The Association of Professional Flight Attendants (APFA) --
http://www.apfa.org/-- is the largest independent Flight
Attendant union in the nation. It represents more than 25,000
Flight Attendants at American Airlines, including 4,240 Flight
Attendants who have been on furlough following the events of 9/11.

                            About TWU

Founded in 1934, the TWU -- http://www.twuatd.org/-- represents
nearly 125,000 workers in the nation's transportation industries,
including 55,000 workers in the airline and government service
industry in virtually all Class and Crafts. The Airlines Division
represents 42 Locals and 59 labor contracts.

                     About American Airlines

American Airlines is the world's largest airline.  American,
American Eagle and the AmericanConnection regional airlines serve
more than 250 cities in over 40 countries with more than 3,800
daily flights. The combined network fleet numbers more than 1,000
aircraft.  American's award- winning Web site --
http://www.AA.com/-- provides users with easy access to check and
book fares, plus personalized news, information and travel offers.
American Airlines is a founding member of the oneworld Alliance,
which brings together some of the best and biggest names in the
airline business, enabling them to offer their customers more
services and benefits than any airline can provide on its own.
Together, its members serve more than 600 destinations in over 135
countries and territories.  American Airlines, Inc. and American
Eagle are subsidiaries of AMR Corporation (NYSE: AMR).

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 27, 2005,
Moody's Investors Service commented that the amendments to the
liquidity facilities that provide credit support to American
Airlines, Inc.'s Series 1999-1 Class A1, A2 and B Enhanced
Equipment Trust Certificates would not affect the current ratings
assigned to these certificates.  The current ratings are Baa3 for
the Class A1 and A2 certificates and Ba3 for the Class B
certificates.

As reported in the Troubled Company Reporter on Feb. 28, 2005,
Standard & Poor's Ratings Services placed its ratings on American
Airlines Inc.'s (B-/Stable/--) equipment trust certificates on
CreditWatch with negative implications.  The rating action does
not affect issues that are supported by bond insurance policies.

"The CreditWatch review is prompted by Standard & Poor's concern
that a prolonged difficult airline industry environment,
characterized by high fuel prices, excess capacity, and intense
price competition in the domestic market, has weakened the
financial condition of almost all U.S. airlines and increased
the risk of widespread simultaneous bankruptcies," said Standard &
Poor's credit analyst Philip Baggaley.

At Dec. 31, 2004, AMR Corp.'s balance sheet shows that liabilities
exceed assets by $581 million.


ARGONAUT GROUP: Good Performance Prompts S&P to Lift Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services raised its counterparty credit
rating on Argonaut Group Inc. to 'BBB-' from 'BB+'.

At the same time, Standard & Poor's raised its counterparty credit
and financial strength ratings on Argonaut Group Inc.'s operating
insurance companies to 'A-' from 'BBB+'.

Standard & Poor's also raised its preferred stock rating on
Argonaut by two notches to 'BB' from 'B+'. The notching between
the preferred stock rating and holding company counterparty credit
rating was narrowed to two notches in accordance with our criteria
for investment-grade ratings.

The outlook on Argonaut and its subsidiaries is stable.

"The upgrade reflects Argonaut's improved and strong
capitalization as of year-end 2004, improved earnings, improved
competitive position, successful execution of its strategic focus
on niche markets where it can excel, and a level of financial
leverage supportive of the rating," explained Standard & Poor's
credit analyst Jason Jones.

Partially offsetting these strengths are capital considerations
and underwriting results that, while profitable, are not yet as
strong as some of its competitors.  Standard & Poor's expects
underwriting results to continue improving in 2005 with a combined
ratio of 95%-96%, driven by strong results in excess and surplus
lines, lower expected catastrophe losses, and continued consistent
underwriting profits from the Select Markets and Public Entity
segments.

Premium growth is expected to slow in 2005 but should continue to
benefit from the generally favorable pricing environment in
casualty excess and surplus lines and the impact of past renewal
rights transactions.  Despite the strain of new business volume,
capital adequacy is expected to remain strong, as earnings support
growth.  Holding company fixed-charge coverage is expected to
improve to 7x in 2005 from an already strong 6x in 2004, and debt
plus preferred financial leverage is expected to remain at roughly
its year-end 2004 level of 21%.


ARMSTRONG WORLD: Files 3rd Cir. Appeal Brief on Plan Confirmation
-----------------------------------------------------------------
In accordance with a briefing schedule set forth by the United
States Court of Appeals for the Third Circuit, Armstrong World
Industries, Inc. delivered on May 25, 2005, its brief in support
of its appeal from Judge Robreno's order denying confirmation of
its Fourth Amended Plan of Reorganization.

Gregory S. Coleman, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, relates that AWI's Plan of Reorganization,
which was approved of and endorsed by all parties, including the
Official Committee of Unsecured Creditors, incorporated a
provision for the distribution of new warrants to old equity if
all classes of creditors voted for the Plan.  The provision also
contemplated that the unsecured creditors might vote against AWI's
Plan and, therefore, provided for an alternative mechanism for
distributing the warrants if that happened.

Mr. Coleman contends that despite its initial support for AWI's
Plan, the Creditors Committee changed its mind based on its
"incorrect speculation" that the U.S. Congress would pass pending
legislation that would provide the Committee a better deal than
the Plan.

The Creditors Committee raised a number of pro forma objections to
the Plan, including an allegation that the plan violated the
absolute priority rule.  The absolute priority objection was based
on the Plan's provision for the distribution of new warrants to
purchase reorganized Armstrong stock to the asbestos personal
injury claimants.  The Bankruptcy Court had rejected the
Committee's objection and also found that the objection had been
waived by the Committee's "sharp conduct" in previously
negotiating and supporting AWI's Plan.  District Judge Robreno,
however, upheld the Committee's objection based on the absolute
priority rule, and so denied the confirmation of AWI's Plan.

Mr. Coleman asserts that the District Court erred in finding that
AWI's Plan violates the absolute priority rule.  The language,
intent, purpose, and history of the rule all demonstrate that
equity holders may, in some circumstances, receive property even
though some unsecured creditors are impaired under a plan of
reorganization, and that the rule is limited by equitable
considerations.

The Bankruptcy Code clearly permits the asbestos personal injury
creditors to do what they choose with the warrants they are
entitled to receive under the Plan, including declining them so
that they pass to Armstrong Holdings, Inc., Mr. Coleman notes.
Moreover, the absolute priority rule prohibits the receipt of
property by a junior interest holder only when it receives that
property "on account of" those junior interests.  However, Mr.
Coleman states, Armstrong Holdings received the warrants "not on
account of its junior interests but in settlement of intercompany
claims and to assist AWI in emerging more quickly from
bankruptcy."

In addition, Mr. Coleman argues that the unique circumstances of
AWI's case, including the Creditors Committee's "sharp conduct,"
the large size and protracted length of AWI's bankruptcy, the
peculiar problems presented by asbestos bankruptcies, and the de
minimis value of the new warrants relative to the size of AWI's
estate, mandate the application of an equitable exception to the
absolute priority rule.

Furthermore, Mr. Coleman contends that the Creditors Committee's
right to raise its absolute priority objection was waived by its
conduct in negotiating, supporting, and endorsing to its
constituency a plan and disclosure statement that included the
challenged provision for distribution of the new warrants.

Mr. Coleman also points out that the Plan does not violate the
absolute priority rule given these unique circumstances in AWI's
cases:

   (a) The Creditors Committee was involved in the formulation,
       negotiation, and drafting of the plan and expressly
       endorsed the provisions it now claims are not fair and
       equitable;

   (b) The Creditors Committee stated in the disclosure statement
       that it supported the plan and encouraged the constituency
       of unsecured creditors to vote in favor of the plan;  The
       disclosure statement was signed by the Committee's counsel
       and approved by the Bankruptcy Court;

   (c) As it is undisputed that the Class 7 claimants' receipt of
       the new warrants under the plan is not improper, their
       waiver of their rights to the new warrants does not reduce
       the distribution the Class 6 creditors could receive;

   (d) The estimated value of the new warrants is approximately
       one percent of the total value to be distributed under the
       plan, and it is also possible that the warrants will be
       worthless;

   (e) The constituency that the Creditors Committee represents
       overwhelmingly voted, in number, to accept the plan; and

   (f) The Creditors Committee's absolute priority objection was
       purely a stalling tactic based on its misguided view that
       asbestos legislation was imminent, and this strategy has
       already resulted in a 19-month delay in AWI's Chapter 11
       cases.

Mr. Coleman asserts that the Creditors Committee's objection based
on the absolute priority rule is a canard and that the Committee's
"obvious motive was delay and not any issue with the manner in
which the plan provided for the distribution of the new warrants."

Mr. Coleman says that an oral argument would help the Court of
Appeals to understand the complex factual circumstances that have
developed over the four-and-a-half years that AWI's bankruptcy
case has lasted.  The oral argument would also underlie the
Bankruptcy Court's recommendations to confirm AWI's Plan and
reject the objections raised by the Committee.

Therefore, AWI proposes that Judge Robreno's Order denying
confirmation of its Plan should be reversed and that AWI's case
should be remanded to the District Court with instructions to
proceed in a manner consistent with the Court of Appeal's opinion.

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. -- http://www.armstrong.com/-- the major
operating subsidiary of Armstrong Holdings, Inc., designs,
manufactures and sells interior finishings, most notably floor
coverings and ceiling systems, around the world.  The Company and
its debtor-affiliates filed for chapter 11 protection on
December 6, 2000 (Bankr. Del. Case No. 00-04469).  Stephen
Karotkin, Esq., at Weil, Gotshal & Manges LLP, and Russell C.
Silberglied, Esq., at Richards, Layton & Finger, P.A., represent
the Debtors in their restructuring efforts.  When the Debtors
filed for protection from their creditors, they listed
$4,032,200,000 in total assets and $3,296,900,000 in liabilities.
As of March 31, 2005, the Debtors' balance sheet reflected a
$1.42 billion stockholders' deficit. (Armstrong Bankruptcy
News, Issue No. 77; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


ASSET BACKED: Sufficient Credit Support Cues S&P to Hold Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on 196
classes of pass-through certificates from 23 transactions issued
by Asset Backed Securities Corp. Home Equity Loan Trust.

The affirmations are based on credit support that is sufficient to
maintain the current rating levels.  Cumulative losses in these
transactions range from 0.00% (for five transactions) to 3.37%
(series 1999-LB1) of the original pool balances.  In addition,
90-plus-day delinquencies (including REOs and foreclosures) range
from 0.94% (series 2004-HE8) to 19.77% (series 2003-HE1) of the
current pool balances.  Credit support is provided through a
combination of excess spread, overcollateralization, and
subordination.  In addition, series 1999-LB1 has the benefit of
being fully insured by MBIA Insurance Corp.

Transactions originating in 2001 and 2002 have experienced
significantly higher than expected prepayments, resulting in
relatively low pool balances. The pool balances for these
transactions are less than 20% of their original values.  Although
less seasoned, transactions issued in 2003 have also experienced
relatively low pool balances, due to accelerated principal
prepayments.  The pool factors for these transactions range from
25.05% (series 2003-HE1) to 51.15% (series 2003-HE6).

Transactions issued in 2001 and 2002 are either at or approaching
their step-down date.  The step-down date for each transaction is
the later of the following: 36 months from the first distribution
date, and the first distribution date on which the senior
enhancement percentage is greater than or equal to 2x the initial
percentage.  After each step-down date, provided certain trigger
tests are met, the required level of overcollateralization may be
reduced to reflect the greater of 2x the original
overcollateralization percentage times the then-current pool
balance, or 0.5% of the original pool balance.

The underlying collateral for these transactions consists of
closed-end, first-lien, fixed- and adjustable-rate mortgage loans
with original terms to maturity of not more than 30 years.

                          Ratings Affirmed

       Asset Backed Securities Corp. Home Equity Loan Trust

    Series     Class                                     Rating
    ------     -----                                     ------
    1999-LB1   A-1F, A-2F, A-3A, A-5A                    AAA
    2001-HE1   M-1                                       AAA
    2001-HE1   M-2                                       A
    2001-HE1   B                                         BBB-
    2001-HE2   A1, A2, M1                                AAA
    2001-HE2   M2                                        A
    2001-HE2   B                                         BBB
    2001-HE3   A-IO, A1                                  AAA
    2001-HE3   M1                                        AA
    2001-HE3   M2                                        A
    2001-HE3   B                                         BBB
    2002-HE1   A-IO                                      AAA
    2002-HE1   M1                                        AA
    2002-HE1   M2                                        A
    2002-HE1   B                                         BBB
    2002-HE2   M1                                        AA
    2002-HE2   M2                                        A
    2002-HE2   B                                         BBB
    2002-HE3   II-M1                                     AA
    2002-HE3   M2                                        A
    2002-HE3   M3                                        BBB
    2002-HE3   M4                                        BBB-
    2003-HE1   A1, A2, A4, A-IO                          AAA
    2003-HE1   M1                                        AA
    2003-HE1   M2                                        A
    2003-HE1   M3                                        BBB
    2003-HE1   M4                                        BBB-
    2003-HE2   A1, A2, A-INV-IO, A-IO                    AAA
    2003-HE2   M1                                        AA
    2003-HE2   M2                                        A
    2003-HE2   M3                                        A-
    2003-HE2   M4                                        BBB
    2003-HE2   M5                                        BBB-
    2003-HE3   A1, A2, A-INV-IO, A-IO                    AAA
    2003-HE3   M1                                        AA
    2003-HE3   M2                                        A
    2003-HE3   M3                                        A-
    2003-HE3   M4                                        BBB
    2003-HE3   M5                                        BBB-
    2003-HE4   A1, A2, A3, A4, A-INV-IO, A-IO            AAA
    2003-HE4   M1                                        AA
    2003-HE4   M2                                        A
    2003-HE4   M3                                        A-
    2003-HE4   M4                                        BBB
    2003-HE4   M5-A, M5-B                                BBB-
    2003-HE5   A1, A2-A, A2-B, A-IO                      AAA
    2003-HE5   M1                                        AA
    2003-HE5   M2                                        A
    2003-HE5   M3                                        A-
    2003-HE5   M4                                        BBB
    2003-HE5   M5                                        BBB-
    2003-HE6   A1, A2, A3-A, A-3B, A-IO                  AAA
    2003-HE6   M1                                        AA
    2003-HE6   M2                                        A
    2003-HE6   M3                                        A-
    2003-HE6   M4                                        BBB+
    2003-HE6   M5                                        BBB
    2003-HE6   M6                                        BBB-
    2003-HE7   A1, A2, A3, A-IO                          AAA
    2003-HE7   M1                                        AA
    2003-HE7   M2                                        A
    2003-HE7   M3                                        A-
    2003-HE7   M4                                        BBB+
    2003-HE7   M5                                        BBB
    2003-HE7   M6                                        BBB-
    2004-HE1   A1, A2, A3, A-IO                          AAA
    2004-HE1   M1                                        AA
    2004-HE1   M2                                        A
    2004-HE1   M3                                        A-
    2004-HE1   M4                                        BBB+
    2004-HE1   M5                                        BBB
    2004-HE1   M6                                        BBB-
    2004-HE2   A1, A2, A2A, A3                           AAA
    2004-HE2   M1                                        AA
    2004-HE2   M2                                        A
    2004-HE2   M3                                        A-
    2004-HE2   M4                                        BBB+
    2004-HE2   M5A, M5B                                  BBB
    2004-HE2   M6                                        BBB-
    2004-HE3   A1, A1A, A2, A2A, A3, A3A                 AAA
    2004-HE3   M1                                        AA
    2004-HE3   M2                                        A
    2004-HE3   M3                                        A-
    2004-HE3   M4                                        BBB+
    2004-HE3   M5                                        BBB
    2004-HE3   M6                                        BBB-
    2004-HE3   M7                                        BB+
    2004-HE5   A1, A1A, A2, A3, A4                       AAA
    2004-HE5   M1                                        AA
    2004-HE5   M2                                        A
    2004-HE5   M3                                        A-
    2004-HE5   M4                                        BBB+
    2004-HE5   M5                                        BBB
    2004-HE5   M6                                        BBB-
    2004-HE5   M7                                        BB+
    2004-HE6   A1, A2                                    AAA
    2004-HE6   M1                                        AA
    2004-HE6   M2                                        A
    2004-HE6   M3                                        A-
    2004-HE6   M4                                        BBB+
    2004-HE6   M5                                        BBB
    2004-HE6   M6                                        BBB-
    2004-HE6   M7                                        BBB-
    2004-HE7   A1, A2, A3, A4                            AAA
    2004-HE7   M1                                        AA
    2004-HE7   M2                                        A+
    2004-HE7   M3                                        A
    2004-HE7   M4                                        A-
    2004-HE7   M5                                        BBB+
    2004-HE7   M6                                        BBB
    2004-HE7   M7                                        BBB
    2004-HE7   M8                                        BBB-
    2004-HE7   M9                                        BB+
    2004-HE8   A1, A2                                    AAA
    2004-HE8   M1                                        AA+
    2004-HE8   M2                                        A
    2004-HE8   M3                                        A-
    2004-HE8   M4                                        BBB+
    2004-HE8   M5                                        BBB
    2004-HE8   M6                                        BBB-
    2004-HE8   M7                                        BB+
    2004-HE9   A1, A2, A3, A4                            AAA
    2004-HE9   M1                                        AA
    2004-HE9   M2                                        A
    2004-HE9   M3                                        A-
    2004-HE9   M4                                        BBB+
    2004-HE9   M5                                        BBB
    2004-HE9   M6                                        BBB-
    2004-HE9   M7                                        BB+
    2004-HE10  A1, A2, A3                                AAA
    2004-HE10  M1                                        AA+
    2004-HE10  M2                                        AA
    2004-HE10  M3                                        A
    2004-HE10  M4                                        BBB+
    2004-HE10  M5                                        BBB
    2004-HE10  M6                                        BBB-
    2004-HE10  M7                                        BB+


ATA AIRLINES: Gets Court Nod to Hire Adelphi as Investment Banker
-----------------------------------------------------------------
As previously reported in the Troubled Company Reporter on May 31,
2005, Ambassadair Travel Club, Inc., and Amber Travel, Inc., ATA
Airlines' debtor-affiliates, sought the U.S. Bankruptcy Court for
the Southern District of Indiana's authority to employ Adelphi
Capital, LLC, to provide investment-banking services in
conjunction with a possible sale of their assets.

Adelphi is a transaction advisory and strategic consulting
practice based in Washington, D.C.  The firm offers its clients a
range of transaction-focused services that include:

   (i) sourcing, evaluating, and structuring merger and
       acquisition transactions;

  (ii) securing and directing private equity investments and
       debt financing; and

(iii) developing strategic initiatives that maximize long-term
       growth potential and profitability.

At the Debtors' behest, the Court approved the motion.

Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers.  ATA has one of the
youngest, most fuel-efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft.  The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations.  Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange.  The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874).  Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
$745,159,000 in total assets and $940,521,000 in total debts.
(ATA Airlines Bankruptcy News, Issue No. 25; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


BEAR STEARNS: Litigation Costs Cue S&P to Cut Ratings on 3 Classes
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on classes
G, H, and J of Bear Stearns Commercial Mortgage Securities Inc.'s
commercial mortgage pass-through certificates from series 2001-
TOP2.  The certificates remain on CreditWatch with negative
implications, where they were placed on May 19, 2005.

The lowered ratings reflect pending interest shortfalls due to
approximately $565,000 of litigation expenses related to the 1601
McCarthy litigation that will be recovered from the trust
beginning with the next payment date in June.  The current rating
action incorporates Standard & Poor's expectation that the
interest shortfalls will be ongoing for several months.  However,
additional shortfalls can be expected as litigation is ongoing,
which may result in further rating actions.

          Ratings Lowered And Remain Creditwatch Negative

          Bear Stearns Commercial Mortgage Securities Inc.
        Commercial mortgage pass-thru certs series 2001-TOP2

                     Rating
                     ------
       Class  To              From            Credit Enhancement
       -----  --              ----            ------------------
       G      BB/Watch Neg    BB+/Watch Neg                3.68%
       H      B+/Watch Neg    BB-/Watch Neg                2.99%
       J      B/Watch Neg     B+/Watch Neg                 2.18%


BOB'S DISCOUNT: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Bob's Discount Off-Price Superstores
        aka Bob's Discount Furniture
        aka Bob's Discount Furniture and More
        aka Bob's Discount
        aka Bob's Off-Price
        aka Super Buys, Inc.
        P.O. Box 100
        Greene, Maine 04236

Bankruptcy Case No.: 05-20992

Type of Business: The Debtor operates general merchandise
                  discount stores.

Chapter 11 Petition Date: June 7, 2005

Court: District of Maine (Portland)

Judge: James B. Haines Jr.

Debtor's Counsel: Jonathan R. Doolittle, Esq.
                  Verill & Dana
                  One Portland Square
                  P.O. Box 586 DTS
                  Portland, Maine 04112

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Ther-a-pedic                  Loan and merchandise      $186,203
135 Spark Street
Brockton, MA 02302

Liberty Furniture             Merchandise                $96,394
6195 Purdue Drive
Atlanta, GA

World Imports                 Merchandise                $82,725
P.O. Box 827802
Philadelphia, PA 19182-7802

GPS Furniture                 Merchandise                $78,254

Robert H. Dinan               Loan                       $74,611

A.F. Associates               Merchandise                $61,825

Acadia Insurance Company      Property insurance         $45,923

Forever Beautiful             Merchandise                $37,967

Coaster Co. of America        Merchandise                $34,420

Maine Employer's Mutual       Worker's compensation      $30,075
Insurance Co.                 insurance.

Home Dynamix                  Merchandise                $29,127

Sun Journal                   Advertising                $27,563

Adelphia Media Services       Advertising                $21,482

Arett Sales                   Merchandise                $20,457

Ocean Desert Sales            Merchandise                $20,323

Press Herald/Telegram         Advertising                $19,445

Scarborough Realty Co.        Lease                      $19,192

Capital Factors, Inc.                                    $18,700

Seminole Furniture            Merchandise                $17,111
Manufacturing

DeBartolo Springs Etd.        Merchandise                $13,635


BORDEN CHEMICAL: Merges Two Units to Form Hexion Specialty
----------------------------------------------------------
Borden Chemical, Inc., Resolution Performance Products LLC, and
Resolution Specialty Materials LLC, completed their previously
reported combination to form Hexion Specialty Chemicals, Inc., the
world's largest producer of thermosetting resins.  Hexion also
includes Bakelite AG, which Borden Chemical acquired in late
April.

"We are pleased to complete the formation of Hexion Specialty
Chemicals and are excited about the benefits our combined
enterprise will bring to our customers," said Craig O. Morrison,
president and chief executive officer. Hexion Specialty Chemicals
will be headquartered in Columbus, Ohio.

                        Hexion Combination

On Apr. 22, 2005, Borden Chemical entered into a merger agreement
with Resolution Performance Products, Inc. and Resolution
Specialty Materials, Inc.  The Company, RPP and RSM are controlled
by Apollo.  Upon the consummation of the Merger, the Company will
change its name to Hexion Specialty Chemicals, Inc. Completion of
the Merger is subject to customary closing conditions and the
Company, RPP and RSM will continue to operate independently until
those conditions are satisfied and each of the closings occur.
The Merger will be treated, for accounting purposes, as a
combination of entities under common control.

                      Hexion Preferred Stock

In May 2005, Hexion Escrow Corp., which merged with Hexion upon
consummation of the Merger, offered 14 million shares of Series A
Floating Rate Preferred Stock, par value $0.01 per share, and
initial liquidation preference of $25 per share.  The Preferred
Stock will accumulate cumulative preferential dividends from the
issue date at an initial rate of LIBOR plus 8.0%, compounded semi-
annually.  Prior to November 2005, the Company has the option to
redeem all or a portion of the Preferred Stock at 100% of the
aggregate liquidation value plus accrued and unpaid dividends.
The Company expects to use the proceeds from its initial public
offering, discussed below, to redeem the Preferred Stock. If the
Merger is not consummated by July 31, 2005, the Preferred Stock is
subject to special mandatory redemption.  The net proceeds from
the Preferred Stock issuance are expected to be $336,000, after
deducting underwriting expenses and estimated expenses of the
offering, and will be used to pay a dividend to the Company's
parent.

                      Registration Statement

On April 25, 2005, the Company filed a registration statement,
which is not yet effective, with the U.S. Securities and Exchange
Commission for a proposed initial public offering of its common
stock.  The Company intends to commence the sale of its common
stock to the public, upon completion of the Merger and upon
approval by the SEC of the registration statement, under the
Hexion Specialty Chemicals, Inc. name.  The Company and a selling
shareholder will sell the shares of common stock.  The Company
will not receive any of the proceeds from the sale of shares by
the selling shareholder.  The proceeds from the sale of shares by
the Company will be used to redeem the Hexion Preferred Stock.

                      Bakelite Acquisition

On April 29, 2005, Borden Chemical Canada, Inc., a subsidiary of
the Company, through its wholly owned subsidiary, National Borden
Chemical Germany Gmbh, completed its acquisition of Bakelite
Aktiengesellschaft pursuant to a share purchase agreement with
RUTGERS AG and RUTGERS Bakelite Projekt GmbH dated October 6,
2004.  Based in Iserlohn-Letmathe, Germany, Bakelite is a leading
source of phenolic and epoxy thermosetting resins and molding
compounds with 13 manufacturing facilities and 1,700 employees in
Europe and Asia.

In the transaction, the Sellers exchanged all of their respective
shares of Bakelite's stock for cash and debt assumed in an
aggregate amount of EUR207,000 or approximately $267,000.  The
transaction was financed via a second-priority senior secured
bridge loan facility in the amount of $250,000 and available cash.
The bridge financing arrangement has a variable interest rate
equal to LIBOR plus an applicable margin and has a final maturity
date of July 15, 2014.

                         About Hexion

Hexion Specialty Chemicals Inc. -- http://www.hexionchem.com/--  
is owned by affiliates of the private investment firm Apollo
Management, L.P.   Hexion Specialty Chemicals had pro forma 2004
annual net sales of $4.1 billion.  The company has approximately
7,000 employees and will rank third among North American-based
specialty chemical firms.  It has 86 manufacturing and
distribution sites in 18 countries in the Americas, Europe and the
Asia-Pacific region.  It has a broad range of products,
technologies and technical services for the industrial
marketplace.  More information about Hexion Specialty Chemicals
can be found at the company's web site at

           About Resolution Performance Products LLC

Resolution Performance Products LLC, based in Houston, operates in
the United States, Europe and Asia.  The Company has 950 employees
and 2004 sales of $996 million.  Apollo acquired RPP from Shell
Oil Company in November 2000.

               Resolution Specialty Materials LLC

Resolution Specialty Materials LLC, was formed from businesses
acquired by Apollo Management from Eastman Chemical Company in
August 2004.  Based in Houston, the Company has 2,100 employees
and facilities in the U.S., Europe and China.  The Company had
annual sales of $768 million in 2004.

                          Bakelite AG

Bakelite AG, based in Iserlohn-Letmathe, Germany, has 13
manufacturing facilities in Europe and Asia, 1,700 employees and
2004 sales of $699 million. The company was acquired by Borden
Chemical Inc., in April 2005.

                    About Apollo Management

Apollo Management, L.P., founded in 1990, is among the most active
and successful private investment firms in the U.S. in terms of
both number of investment transactions completed and aggregate
dollars invested.  Since its inception, Apollo has managed the
investment of an aggregate of approximately $13 billion in equity
capital in a wide variety of industries, both domestically and
internationally.

                   About Borden Chemical Inc.

Borden Chemical Inc., has 48 manufacturing facilities in 9
countries, 2,400 associates and 2004 sales of $1.7 billion. Based
in Columbus, Ohio. Apollo Management acquired Borden Chemical in
August 2004.

At Mar. 31, 2005, Borden Chemical, Inc.'s balance sheet showed a
$515,000,000 stockholders' deficit, compared to a $549,000,000
deficit at Dec. 31, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 28, 2005,
Standard & Poor's Ratings Services placed its 'B+' corporate
credit rating and other ratings for Borden Chemical Inc. on
CreditWatch with negative implications, citing the company's:

    (1) announcement of a sizable merger,
    (2) a large dividend payment, and
    (3) a proposed IPO.

Standard & Poor's also placed its 'B+' corporate credit rating and
other ratings for Resolution Specialty Materials LLC on
CreditWatch with negative implications.  At the same time,
Standard & Poor's placed its 'B-' corporate credit rating and
other ratings for Resolution Performance Products LLC on
CreditWatch with positive implications.


BORDEN CHEMICAL: S&P Confirms B+ Rating After Merger Completed
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating and other ratings for Hexion Specialty Chemicals
Inc. (formerly Borden Chemical Inc.) following the close of the
previously announced merger of Borden, Resolution Specialty
Materials LLC, and Resolution Performance Products LLC.

At the same time, Standard & Poor's withdrew its 'B+' ratings on
RSM after repayment of the company's rated debt obligations.
Standard & Poor's also raised the ratings on RPP and removed them
from CreditWatch with positive implications to reflect the
completion of the merger transaction (the 'B+' corporate credit
rating for RPP has subsequently been withdrawn).  The outlook is
negative.  Columbus, Ohio-based Hexion has more than $2.3 billion
of total debt outstanding.

"The ratings reflect a very aggressive financial profile resulting
from high debt leverage at the outset of the merger, somewhat
offset by a satisfactory business profile as a leading global
manufacturer and marketer of thermoset resins," said Standard &
Poor's credit analyst George Williams.

The combination represents a meaningful strategic initiative as it
creates one of the largest specialty chemical companies in North
America with a more diversified product portfolio, technology
base, end market sales, and geographic sales base.  During the
next few years, management is expected to balance capital
spending, integration efforts, and modest expansion efforts so
that some debt reduction can be achieved, thus maintaining key
financial ratios at appropriate levels for the ratings.

With pro forma revenues of $4.1 billion, Hexion is a leading
manufacturer of thermoset resins.

Key products include:

    (a) Formaldehyde and formaldehyde-based resins for the forest
        products, electronics, foundry and oil field services
        industries;

    (b) Base liquid epoxy resins (LER), solid epoxy resins, epoxy
        solutions, and other specialty products for use in
        coatings, adhesives, electronics, and construction
        materials; and

    (c) Alkyd, polyester and acrylic resins for use in paints and
        coatings.

Hexion's credit quality reflects its well-established business
positions within key segments of the $34 billion thermoset resins
industry; the company will hold the No. 1 or No. 2 market position
in product lines that make up 75% of sales.  For example, as a
stand-alone company Borden is the leading global manufacturer of
formaldehyde (consuming much of its production internally),
holding more than 15% of the worldwide formaldehyde-based resin
market, with a larger share in North America.  It is also the
largest producer of specialty phenolic resins.  The combination
adds RPP's well-established position as a producer of epoxy resins
(competitors include The Dow Chemical Co. and Huntsman Advanced
Materials LLC), and the company's leading global market shares for
versatic acids and derivatives and for Bisphenol A, a key epoxy
raw material, which is sold to the fast-growing polycarbonate
market.


BRADLEY PHARMACEUTICALS: Defaults on Convertible Sr. Sub. Notes
---------------------------------------------------------------
Bradley Pharmaceuticals, Inc., received a notice from a beneficial
holder of the Company's 4% Convertible Senior Subordinated Notes
due 2013 advising the Company that it is in default under the
Indenture and declaring the principal of the Convertible Notes and
interest thereon to be due and payable.

As previously reported in the Troubled Company Reporter, the
Company received a notice on Apr. 25, 2005, from the noteholder
claiming a default under the related indenture as a result of the
Company's failure to file its Annual Report on Form 10-K.  The
notice said that the default, if not cured within 30 days after
receipt of that notice, would constitute an event of default
entitling the trustee or note holders to accelerate maturity of
the Convertible Notes, which have an aggregate principal amount of
$37 million.

However, in light of the notice described below relating to the
Company's credit facility, no payment may be made to the
noteholders under the Indenture with respect to the Convertible
Notes until the end of the Payment Blockage Period described
below.

In accordance with the Indenture, the administrative agent for the
lenders that are party to the Company's $125 million credit
facility sent a notice on May 20, 2005, to the trustee under the
Indenture advising the trustee that certain non-payment defaults
exist under the credit facility and electing to effect a Payment
Blockage Period under the Indenture.  The credit facility
represents indebtedness that is senior to the Convertible Notes.

Under the Indenture, a "Payment Blockage Period" means the period
commencing upon receipt by the trustee of the Payment Blockage
Notice and ending on the earliest of:

   -- 179 days thereafter (provided that the senior indebtedness
      to which the non-payment default relates has not been
      accelerated);

   -- The date on which the non-payment default is cured, waived
      or ceases to exist;

   -- The date on which the senior indebtedness is discharged or
      paid in full; or

   -- The date on which the Payment Blockage Period is terminated
      by written notice to the trustee from the representative of
      the senior indebtedness initiating the Payment Blockage
      Period.

               Comprehensive Financing Solution

In addition, the Company and Wachovia Bank, National Association,
the administrative agent for the lenders that are party to the
Company's $125 million credit facility, reached an agreement in
principle, subject to the execution of standard commitment
documents that will contain customary terms and conditions,
pursuant to which a new comprehensive financing solution for the
Company is anticipated to be implemented during the first half of
the Company's third quarter.  This financing will enable the
Company to satisfy in its entirety all obligations under the
Convertible Notes and provide the Company with both term and
revolving credit facilities.  Upon closing of this new facility,
the Company's existing credit facility and the Convertible Notes
will each be extinguished.

                    $1 Million Restatement

On April 21, 2005, the Company received notice from its
independent auditors, Grant Thornton LLP, that during their
audit of the Company's financial statements for the year ended
December 31, 2004, which they have not completed, they became
aware of information indicating that a transaction recorded as a
sale by the Company in the quarter ended September 30, 2004 did
not meet the criteria for revenue recognition in that period.  On
April 25, 2005, the Company received a further notice from Grant
Thornton LLP advising of a material weakness in the Company's
internal controls in connection with the approval and
consideration by appropriate personnel of all terms and conditions
of the transaction and recommending that the Company implement
controls relating to the approval and communication of all terms
and conditions of all sales transactions.

The transaction consisted of a sale of approximately $1 million of
Deconamine Syrup shipped and paid for in the third quarter.  Based
on information provided by the Company, Grant Thornton LLP has
indicated its conclusion that the sale did not meet the criteria
for revenue recognition after the customer expressed its
intentions to return the product and the sale was modified in that
the Company would accept all unsold product as of Feb. 1, 2005,
with credit granted against other trade amounts owed by the
customer.

As a result of the non-recognition of revenue in the third quarter
from this sale, the Company's consolidated statement of income for
the third quarter of 2004 will need to be adjusted and restated to
reduce net sales by $1,043,907 to $27,452,698, net income by
$613,594 to $3,047,789, and the Company's consolidated balance
sheet as of September 30, 2004, will need to be adjusted and
restated to record $1,043,907 of deferred revenue.

Bradley Pharmaceuticals, Inc. (NYSE: BDY) --
http://www.bradpharm.com/-- was founded in 1985 as a specialty
pharmaceutical company marketing to niche physician specialties in
the U.S. and 38 international markets.  Bradley's success is based
on the strategy of Acquire, Enhance and Grow.  Bradley Acquires
non-strategic brands, Enhances these brands with line extensions
and improved formulations and Grows the products through
promotion, advertising and selling activities to optimize life
cycle management.  Bradley Pharmaceuticals is comprised of Doak
Dermatologics, specializing in topical therapies for dermatology
and podiatry, and Kenwood Therapeutics, providing
gastroenterology, respiratory and other internal medicine brands.


BRIDGEPOINT TECHNICAL: Committee Balks at Chapter 11 Plan
---------------------------------------------------------
The Official Committee of Unsecured Creditors of Bridgepoint
Technical Manufacturing Corp. tells the U.S. Bankruptcy Court for
the Western District of Texas it doesn't like the Debtor's Amended
Plan of Reorganization filed on May 11, 2005.

The Committee contends that the Plan shouldn't be confirmed
because it fails to meet four of the 13 standards stated in
Section 1129(a) of the Bankruptcy Code.

              The Plan Violates Section 1122(a)(1)

EOS Partners, L.P., is Bridgepoint's largest majority shareholder.
Under the Plan, EOS' unsecured deficiency claim is not classified
together with other general unsecured claims.  The Plan also
improperly combines EOS' secured and unsecured claims.

The Committee asserts the Plan doesn't provide the same treatment
for each unsecured claim.

              The Plan Violates Section 1129(a)(3)

EOS will retain its interest in the Debtor under the terms of the
Plan.  Also, EOS, as a majority member of the Debtor's Board of
Directors, has access to the Debtor's financial documents giving
it an unfair advantage over the general unsecured creditors.  The
Committee believes the plan wasn't filed in good faith and should
be rejected.

              The Plan Violates Section 1129(a)(7)

The Committee contests EOS Partners' unsecured claim and believes
that it should be recharacterized as equity.  If EOS' claim is
reclassified as equity, the Committee says, unsecured creditors
will get more than the projected 5% recovery on account of their
claims.

If EOS' claim isn't reclassified, the Committee continues, the
Plan will only allow for a 5% recovery to unsecured creditors
while liquidation will give them at least a 14% recovery.

             The Plan Violates Section 1129(a)(11)

According to the Committee, the Debtor fails to demonstrate that
its restructuring plan won't be followed by a liquidation
proceeding.  The Committee points out that only once did the
Debtor manage to make a profit during the course of its
bankruptcy.  In fact, the Debtor projects net losses for 2005 and
2006, the Committee says.

Duane J. Brescia, Esq., and Stephen A. Roberts, Esq., at
Strasburger & Price, LLP, represents the Committee.

                     Review of the Plan

The Plan provides for the full payment of administrative claims,
priority non-tax claims and priority tax claims on the Effective
Date.

Silicon Valley Bank's $1,128,506 claim will be paid in full
pursuant to the terms of its existing loan agreement with the
Debtor.

EOS' claim for $9,231,000 will be satisfied with a 6% unsecured
promissory note for $600,000.

Claims of The CIT Group/Equipment Financing, Inc., Credence
Capital Corporation, VenCore Solutions, LSC, Winthrop Resources
Corp., Greater Bay Capital and Maxus Leasing Group, Inc., will
receive payments in amounts agreed upon and approved by the
Bankruptcy Court.

The Debtor intends to recharacterize its equipment lease with
General Electric Capital Corporation as a financing transaction.
Pursuant to the Plan, the Debtor will retain two pieces of water
prober equipment and will pay GECC $3,000 per month plus 7%
interest after the Effective Date.

General unsecured creditors owed $3 million in the aggregate will
recover about 5% of their claims.  Payments will be made quarterly
over a three-year period 90 days after the Effective Date of the
Plan.

                         *    *    *

The Court will convene a hearing to discuss the merits of the Plan
on June 13, 2005, at 1:30 p.m.

Headquartered in Austin, Texas, BridgePoint Technical
Manufacturing Corp. -- http://www.bridgept.com/-- provides
engineering, testing, packaging, and circuit board assembly
services to semiconductor and computer companies.  The Company
filed for chapter 11 protection on September 3, 2004 (Bankr. W.D.
Tex. Case No. 04-14555).  Mark Curtis Taylor, Esq., at Hohmann &
Taube, LLP, represents the Debtor in its restructuring efforts.
When the Company filed for protection from its creditors, it
estimated $10 million in assets and $50 million in debts.


BUILDERS PLUMBING: Chapter 7 Trustee Hires Shaw as Special Counsel
------------------------------------------------------------------
David Grochocinski, the Chapter 7 Trustee overseeing the
liquidation of Builders Plumbing & Heating Supply Co. and its
debtor-affiliates' estates, sought and obtained permission from
the U.S. Bankruptcy Court for the Northern District of Illinois to
employ Shaw Gussis Fishman Glantz Wolfson & Towbin LLC as his
special litigation counsel.

Shaw Gussis will:

   a) investigate the viability of the claims;

   b) consult the Trustee as to the viability of the claims and
      any conflict that special counsel may have in pursuing such
      claims on behalf of the Trustee;

   c) prepare, file, and attend hearings on pleadings with
      respect to the claims and its consultation of the Trustee;
      and

   d) provide such other services which the Trustee deems
      necessary in connection with the claims.

Steven B. Towbin, Esq., a partner in Shaw Gussis, discloses that
his Firm's professionals bill:

         Professional                  Hourly Rate
         ------------                  -----------
         Steven B. Towbin                 $490
         Jeffrey L. Widman                $365
         Mark L. Radtke                   $250

The firm will received a retainer of $15,000 paid by the Trustee
with funds from the Debtors' estates.

Mr. Towbin assures the Court that the firm has no adverse interest
in this matter, to the Trustee or the Debtors.

Headquartered in Addison, Illinois, Builders Plumbing & Heating
Supply Co. is a plumbing product distributor.  The Debtor and its
affiliates filed for chapter 11 protection on December 5, 2003
(Bankr. N.D. Ill. Case No. 03-49243).  Brian A. Audette, Esq.,
David N. Missner, Esq., and Marc I. Fenton, Esq., at Piper Rudnick
represent the Debtors in their restructuring efforts.  When the
Company filed for protection from their creditors, they listed
assets of $62,834,841 and debts of $57,559,894.


CARRINGTON MORTGAGE: Fitch Rates $21 Million Private Class at BB+
-----------------------------------------------------------------
Carrington Mortgage Loan Trust 2005-NC3 certificates are rated by
Fitch Ratings:

     -- $1.4 billion class A (senior certificates) 'AAA';
     -- $52.7 million class M-1 'AA+';
     -- $81.3 million class M-2 'AA';
     -- $26.8 million class M-3 'AA-';
     -- $53.6 million class M-4 'A';
     -- $29.5 million class M-5 'A-';
     -- $33 million class M-6 'BBB+';
     -- $25.9 million class M-7 'BBB';
     -- $19.6 million (privately offered) class M-8 'BBB-';
     -- $21.4 million (privately offered) class M-9 'BB+'.

The 'AAA' rating on the senior certificates reflects the 22.20%
total credit enhancement provided by the 2.95% class M-1, the
4.55% class M-2, the 1.50% class M-3, the 3.00% class M-4, the
1.65% class M-5, the 1.85% class M-6, the 1.45% class M-7, the
1.10% class M-8, the 1.20% class M-9, and the 2.95% initial
overcollateralization.

All certificates have the benefit of monthly excess cash flow to
absorb losses.  In addition, the ratings reflect the integrity of
the transaction's legal structure as well as the primary servicing
capabilities of New Century Mortgage Corporation (rated 'RPS3' by
Fitch).  Deutsche Bank National Trust Company will act as Trustee.

As of the cut-off date (June 1, 2005), the mortgage loans have an
aggregate balance of $1,486,053,162.  The weighted average
mortgage rate is approximately 7.213% and the weighted average
remaining term to maturity is 356 months.  The average cut-off
date principal balance of the mortgage loans is approximately
$178,345.  The weighted average original loan-to-value ratio is
84.64% and the weighted average Fair, Isaac & Co. score is 617.
The properties are primarily located in California (37.38%),
Florida (10.23%) and New York (5.59%).

On the closing date, the depositor will pay to the trustee an
amount equal to approximately $300,000,000, or the original pre-
funded amount, which will be held by the trustee in a pre-funding
account.  The amount on deposit in the pre-funding account will be
reduced by the amount thereof used to purchase subsequent mortgage
loans during the period from the closing date up to and including
July 1, 2005.  Any amount remaining in the pre-funding account
after July 1, 2005 will be distributed as principal on the next
distribution date.


CASCADIA LIMITED: Fitch Rates $300M Variable-Rate Notes at BB
-------------------------------------------------------------
Fitch Ratings has assigned a 'BB' rating to Cascadia Limited's
$300 million variable-rate notes due 2008.  Fitch's rating
reflects its review of EQECAT Inc.'s risk analysis and models used
to analyze the covered risks, the loss distributions resulting
from EQE's analysis, and the transaction's structural soundness.

Cascadia is a Cayman Islands-domiciled company formed solely to
issue the variable-rate notes, enter into a counterparty contract
with Factory Mutual Insurance Company, a U.S. domiciled insurer,
and to conduct activities related to the notes' issuance.  FM
Global and its subsidiaries write commercial property insurance
worldwide.  Fitch rates FM Global's insurer financial strength
'AA-'.

Under the counterparty contract, Cascadia will make specified
payments to FM Global if, during the next three years, earthquakes
of various magnitudes occur in the Pacific Northwest portion of
the U.S. or in portions of British Columbia.  Proceeds from the
notes issue collateralize Cascadia's obligations under the
counterparty contract.

As part of its analysis, Fitch reviewed a sensitivity analysis in
which EQE computed the effect of changes in the mean magnitude of
modeled earthquakes on base case estimated loss statistics.
Fitch's rating considers both these base-case and 'stress-tested'
estimated loss statistics in relation to Fitch's catastrophe-
linked bond-rating curve.  Fitch's analysis of the transaction's
structure included a review of Cascadia's organizational
documents, contracts between Cascadia and various parties, and
various legal opinions.


CATHAY GENERAL: Fitch Places BB+ Rating on Long-Term Senior Notes
-----------------------------------------------------------------
Fitch Ratings has assigned a 'BB+' long-term rating and a 'B'
short-term rating to Cathay General Bancorp and its bank
subsidiary, Cathay Bank.  The ratings are placed on Rating Watch
Positive.

Having acquired GBC Bancorp approximately 18 months ago, CATY has
made substantial progress on the integration of the two firms.
The transaction, which was essentially a merger of equals,
significantly enhanced CATY's Asian-American focused franchise.

GBC, previously rated by Fitch, began to experience some asset
quality issues shortly before the merger, but, to date, CATY has
effectively handled those matters while also maintaining a solid
financial profile that is consistent with an investment-grade
credit.

At the present time; however, the ratings are currently restrained
by the outstanding Memorandum of Understanding the bank is
operating under regarding the FDIC's assessment of the company's
Bank Secrecy Act compliance.  Given the importance of
international trade and cross-border activities to CATY's
business, Fitch believes this compliance matter is a material
rating factor.  If CATY is able to resolve the BSA issues in a
satisfactory manner, Fitch would expect to raise the long-term and
short-ratings by, at least, one notch.

Separately, as a result of the acquisition and integration of GBC
and its bank subsidiary, General Bank, into the new Cathay General
Bancorp and Cathay Bank, respectively, the ratings of GBC and
General Bank have been removed from Rating Watch Evolving, where
they were placed on May 7, 2003, and withdrawn.

These ratings are assigned and placed on Rating Watch Positive by
Fitch:

   Cathay General Bancorp

     -- Long-term senior 'BB+';
     -- Short-term 'B';
     -- Individual 'C'.

   Cathay Bank

     -- Long-term deposits 'BBB-';
     -- Long-term senior 'BB+';
     -- Short-term 'B';
     -- Individual 'C';
     -- Short-term deposits 'F3'.

   The following ratings are assigned by Fitch:

     Cathay General Bancorp
     Cathay Bank

     -- Support '5'.

The following ratings are removed from Rating Watch Evolving and
withdrawn by Fitch:

   GBC Bancorp

     -- Long-term senior 'BB+';
     -- Short-term 'B';
     -- Individual 'C';
     -- Support '5'.

   General Bank

     -- Long-term deposits 'BBB-';
     -- Long-term senior 'BB+';
     -- Short-term deposits 'B';
     -- Short-term 'B';
     -- Individual 'C';
     -- Support '5'.


CATHOLIC CHURCH: Court Denies Portland's Request to Hire Triboro
----------------------------------------------------------------
As previously reported, David A. Foraker, the Future Claimants
Representative appointed in the Chapter 11 case of the Archdiocese
of Portland in Oregon, asserts that the proposed retention of
Triboro Capital, Inc., as the Tort Claimants Committee's financial
advisor, must be denied.

Mr. Foraker points out that until the Tort Committee has the right
to file a plan, the Portland Tort Committee's retention of a
financial advisor for purposes of soliciting proposals for a
postpetition credit facility for funding a plan is premature.

"It is pointless for the Committee to seek to arrange specific
financing that is not supported by the [Archdiocese] unless and
until the Committee has the right to file its own plan," Mr.
Foraker says.

                        Portland Objects

The Archdiocese of Portland in Oregon contends that the Tort
Claimants Committee's request to retain Triboro Capital, Inc.,
fails to recognize that the Archdiocese has been engaged in
discussions with potential lenders for months and is already well
situated to obtain the necessary funding for a plan.  The U.S.
Bankruptcy Court for the District of Oregon has likewise approved
the employment of Mesirow Financial Consulting, LLC, as Portland's
financial advisor, to assist in obtaining any necessary funding.

Thomas W. Stilley, Esq., at Sussman Shank LLP, in Portland,
Oregon, tells Judge Perris that the Tort Committee's proposed
financial advisor will not offer any benefits to the estate
commensurate with the fees which it proposes to charge.

Portland has the exclusive right to file a plan and has requested
an extension of the time to do so.  Mr. Stilley argues that
nothing will be gained by anyone filing a plan before the first
round of mediations is concluded and the parties have a better
sense of how much will be needed to pay claims.  The added expense
to the estate of another financial advisor for the Tort Committee,
who can add little, if anything, to that already being provided by
Mesirow and the Archdiocese's own financial staff, will not
advance the goal of confirming a plan.

Besides, Mr. Stilley adds, the compensation to be provided to
Triboro is unreasonable.  The proposed agreement provides that
Triboro's fees be subject to the review standard set forth in
Section 328(a) of the Bankruptcy Code, not the normal
reasonableness standard under Section 330.  This means that the
Court will have little discretion to reduce the fees as provided
under the agreement.

If Triboro's retention is approved, Mr. Stilley says, Triboro's
retention will cost the estate at least $350,000, plus up to
$90,000 in hourly fees, if any plan is confirmed that is not
funded solely from Portland's own resources.  In contrast,
Mesirow's fees are subject to standard review procedures for
reasonableness under Section 330.

Mr. Stilley also notes that Triboro appears to have no experience
in arranging loans for religious entities.  Triboro has only been
in business since 2002.  Prior to that, its principal, Steven B.
Atwater, worked for Bank Boston.  Although Mr. Atwater claims to
have experience with a broad range of businesses, none of these
include charities or religious organizations where the primary
source of funding is through donations.

                          *     *     *

Judge Perris denies Tort Committee's request to retain Triboro
Capital, Inc., as its financial advisor.  The order is without
prejudice to the Tort Committee's right to later seek permission
to retain a financial advisor.

The Roman Catholic Church of the Diocese of Tucson filed for
chapter 11 protection (Bankr. D. Ariz. Case No. 04-04721) on
September 20, 2004, and delivered a plan of reorganization to the
Court on the same day.  Susan G. Boswell, Esq., Kasey C. Nye,
Esq., at Quarles & Brady Streich Lang LLP, represent the Tucson
Diocese.  (Catholic Church Bankruptcy News, Issue No. 29;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


CHESAPEAKE ENERGY: Buying Back 8.125% & 9% Senior Notes
-------------------------------------------------------
Chesapeake Energy Corporation (NYSE: CHK) is commencing cash
tender offers and consent solicitations for any and all of its
$245,407,000 aggregate principal amount of 8.125% Senior Notes due
2011 and any and all of its $300,000,000 aggregate principal
amount of 9.00% Senior Notes due 2012.

The total consideration to be paid for each validly tendered
8.125% Note will be the price, calculated in accordance with
standard market practice, based on the redemption price of
$1,040.63 per $1,000 principal amount of Notes on the earliest
redemption date, April 1, 2006, and the yield to the earliest
redemption date is equal to the sum of (x) the yield to maturity
on the 1.50% U.S. Treasury Note due March 31, 2006, as calculated
by one of the dealer managers as of 11:00 a.m., New York City
time, on the eleventh business day immediately preceding the
scheduled expiration date of the tender offer, plus .50% (50 basis
points), as more fully described in the Offer to Purchase and
Consent Solicitation Statement dated June 7, 2005.

The total consideration to be paid for each validly tendered 9.00%
Note will be the price, calculated in accordance with standard
market practice, based on the redemption price of $1,045.00 per
$1,000 principal amount of Notes on the earliest redemption date,
August 15, 2007, and the yield to the earliest redemption date is
equal to the sum of (x) the yield to maturity on the 2.75% U.S.
Treasury Note due August 15, 2007, as calculated by one of the
dealer managers as of 11:00 a.m., New York City time, on the
eleventh business day immediately preceding the scheduled
expiration date of the tender offer, plus .50% (50 basis points),
as more fully described in the Offer to Purchase and Consent
Solicitation Statement dated June 7, 2005.

Holders who validly tender their Notes by 5:00 p.m., New York City
time, on June 20, 2005, will receive the total consideration,
which includes the consent payment of $20.00 per $1,000 principal
amount of Notes accepted for purchase.  Holders who validly tender
their Notes by the Consent Date will receive payment on the
initial payment date, which is expected to be on or about June 21,
2005.

The tender offers are scheduled to expire at 5:00 p.m., New York
City time, on July 6, 2005, unless extended.  Holders who validly
tender their Notes after the Consent Date and prior to the
Expiration Date will receive the total consideration minus the
$20.00 consent payment.  Payment for Notes tendered after the
Consent Date will be made promptly after the Expiration Date.

All holders whose Notes are accepted for payment will also receive
accrued and unpaid interest up to, but not including, the
applicable date of payment for the Notes.  In connection with the
tender offers, the Company is soliciting consents to certain
proposed amendments to eliminate substantially all of the
restrictive covenants and events of default in the indentures
governing the Notes.  Holders may not tender their Notes without
delivering consents or deliver consents without tendering their
Notes.

Each tender offer is subject to the satisfaction of certain
conditions, including Chesapeake's receipt of tenders of Notes
representing at least a majority in principal amount of the 8.125%
Notes or 9.00% Notes, as applicable, and completion of a recently
announced private offering of senior notes which will be used to
finance the tender offers.  Neither tender offer is conditioned
upon the other, and either tender offer may be closed without the
closing of the other.  The terms of the tender offers will be
described in the Company's Offer to Purchase and Consent
Solicitation Statement dated June 7, 2005, copies of which may be
obtained from the information agent for the Offer:

                  MacKenzie Partners, Inc.
                  (800) 322-2885 (US toll-free)
                  (212) 929-5500 (collect)

The Company has engaged Bear, Stearns & Co. Inc. and Wachovia
Securities to act as dealer managers and solicitation agents in
connection with the Offers.  Questions regarding the Offer may be
directed to:

                  Bear, Stearns & Co. Inc.
                  Global Liability Management Group
                  (877) 696-BEAR (toll-free)
                  (212) 272-5112 (collect)

                         -- or --

                  Wachovia Securities
                  Liability Management Group
                  (866) 309-6316 (toll-free)
                  (704) 715-8341 (collect)

                     About Chesapeake Energy

Chesapeake Energy Corporation is the fourth largest independent
producer of natural gas in the U.S.  Headquartered in Oklahoma
City, the company's operations are focused on exploratory and
developmental drilling and producing property acquisitions in the
Mid-Continent, Permian Basin, South Texas, Texas Gulf Coast and
Ark-La-Tex regions of the United States.

                          *     *     *

Chesapeake Energy's 8.125% senior notes due 2011 and 9.00% senior
notes due 2012 carry Moody's Investors Service's Ba3 rating,
Standard & Poor's BB- rating, and Fitch's BB rating.


CHESAPEAKE ENERGY: Fitch Rates Senior Unsecured Notes at BB
-----------------------------------------------------------
Fitch Ratings has assigned Chesapeake Energy's senior unsecured
rating of a 'BB' to the company's private placement offering of
$600 million of senior notes due 2018.

Proceeds from the offering will be used to finance a tender offer
for all of the approximately $245.4 million of the company's
outstanding 8.125% senior notes due 2011 and $300 million of 9.00%
senior notes due 2012.  Additionally, Fitch rates Chesapeake's
senior secured revolving credit facility and hedge facility at
'BBB-'. The Rating Outlook is Stable.


CITIGROUP COMMERCIAL: S&P Rates Seven Cert. Classes at Low-B
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Citigroup Commercial Mortgage Trust's $1.451 billion
commercial mortgage pass-through certificates series 2005-C3.

The preliminary ratings are based on information as of June 7,
2005.  Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.

The preliminary ratings reflect the credit support provided by the
subordinate classes of certificates, the liquidity provided by the
trustee, the economics of the underlying loans, and the geographic
and property type diversity of the loans.  Classes A-1, A-2, A-SB,
A-3, A-4, A-1A, A-MFL, A-MFX, A-J, B, C, and D are currently being
offered publicly.  The remaining classes will be offered
privately.  Standard & Poor's analysis determined that, on a
weighted average basis, the pool has a debt service coverage of
1.31x, a beginning LTV of 95.7%, and an ending LTV of 83.2%.

The class CP certificates will represent interests solely in the
loan that is secured by the Carolina Place loan. The portion of
the Carolina Place loan that is represented by these classes is
considered the nonpooled portion of the subject loan.

A copy of Standard & Poor's complete presale report for this
transaction can be found on RatingsDirect, Standard & Poor's Web-
based credit analysis system, at http://www.ratingsdirect.com/
The presale can also be found on the Standard & Poor's Web site at
http://www.standardandpoors.com/

                     Preliminary Ratings Assigned
               Citigroup Commercial Mortgage Trust 2005-C3

              Class       Rating         Preliminary amount
              -----       ------         ------------------
              A-1         AAA                   $75,811,000
              A-2         AAA                  $164,149,000
              A-SB        AAA                   $92,945,000
              A-3         AAA                   $52,867,000
              A-4         AAA                  $329,125,000
              A-1A        AAA                  $289,724,000
              A-MFL       AAA                   $75,000,000
              A-MFX       AAA                   $68,517,000
              A-J         AAA                  $102,256,000
              B           AA                    $30,497,000
              C           AA-                   $16,146,000
              D           A                     $21,528,000
              E           A-                    $17,939,000
              F           BBB+                  $19,734,000
              G           BBB                   $14,352,000
              H           BBB-                  $12,557,000
              J           BB+                    $5,382,000
              K           BB                     $7,176,000
              L           BB-                    $5,382,000
              M           B+                     $5,382,000
              N           B                      $3,588,000
              O           B-                     $2,870,000
              P           N.R.                  $22,245,920
              CP-1        BBB                    $2,760,000
              CP-2        BBB-                   $6,440,000
              CP-3        BB+                    $6,600,000
              XC*         AAA                $1,435,172,920
              XP*         AAA                $1,378,553,000

            *Interest - only class with a notional dollar amount.
                            N.R. - Not rated.


CRB INVESTMENTS: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: CRB Investments, Inc.
        dba Foghorn Pub & Grill
        12930 Southwest Bayshore Drive
        Traverse City, Michigan 49684

Bankruptcy Case No.: 05-08027

Type of Business: The Debtor operates a restaurant that offers
                  seafood and Boone's air-dried, aged beef.

Chapter 11 Petition Date: June 7, 2005

Court: Western District of Michigan (Grand Rapids)

Judge: James D. Gregg

Debtor's Counsel: Michael P. Corcoran, Esq.
                  Michael P. Corcoran
                  617 West Front Street
                  Traverse City, MI 49684
                  Tel: (231) 929-7000

Estimated Assets: $50,000 to $100,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Chemical Bank                 UCC lien on               $365,857
#000801041351                 inventory, AR's
P.O. Box 231
Midland, MI 48640

Ted & Debbie Lockwood         Business Loan             $287,000
10240 East White Birch Drive
Traverse City, MI 49864

John Gernaat                  Business Loan             $207,152
10104 South Blodgett Road
McBain, MI 49657

Chemical Bank                 UCC lien on               $144,121
                              Inventory, AR's
                              Value of security:
                              $70,000

Internal revenue Service      Federal withholding       $112,000
                              Tax

Yacht Haven LLC               Rent in arrears            $78,000


Michigan Dept. of Treasury    Sales and use taxes        $60,073

I Dine Restaurant Group       UCC lien on                $23,000
                              Inventory, AR's

Bay Resource Management       Business loan              $17,000

Advance Me, Inc.              UCC lien on                 $6,000
                              Inventory, AR's

CST Inc.                      Supplies used in            $3,706
                              Business

Traverse the Magazine         Advertising                 $2,987

Elmwood Township              Personal property tax       $2,500

Kalchick Disposal             Utility bills               $1,755

D&W Mechanical                Services                    $1,426

Bud's Refrigeration           Services                    $1,426

Record Eagle                  Advertising                   $873

Boone's Long Lake Inn         Business loan                 $660

Rauch, Milliken Int'l         Advertising                   $512

Valley City Linen             Services                      $500


CROWN HOLDINGS: Moody's Rates $500 Mil. First Lien Loan at Ba3
--------------------------------------------------------------
Moody's Investors Service changed the ratings outlook for Crown
Holdings and its rated operating subsidiaries to positive from
stable reflecting the consistency of cumulative improvements in
financial and operating performance as the company has been
benefiting from realized working capital and efficiency gains,
effective price increases mitigating higher input costs, and
strategic leveraging of its global operations.

The positive ratings outlook acknowledges Crown's improved
financial profile since its substantial debt restructurings in
2003 and 2004 and indicates a strong likelihood of the fundamental
ratings being upgraded in the near term.  Crown's liquidity rating
was upgraded to SGL-1 in December 2004 and recently affirmed in
May 2005 reflecting Moody's expectation of very good liquidity
being maintained throughout the next twelve months.

Possible triggers for the upgrade of the fundamental ratings
include continued enhancement in organic free cash flow, notably
as a percentage of total debt adjusted to include outstandings
under accounts receivable securitization programs, asbestos
liabilities, and unfunded pension and post-retiree benefits.
Should Crown achieve a sustainable ratio of approximately 5%,
absent event risk, the ratings could be upgraded.

While the positive ratings outlook acknowledges the significant
amount of funded debt reduced over the last two years principally
from free cash flow, further reduction in financial leverage and
continued improved profitability could hasten the upgrade of the
ratings.

The ratings for Crown and its subsidiaries are:

   -- Ba3 rating for the $500 million first lien credit facility
      consisting of a $400 million revolver and a $100 million US
      letter of credit facility

   -- Ba3 rating for approximately Euro 460 million ($565 million
      equivalent) 6.25% first lien notes, due 2011, issued by
      Crown European Holdings, S.A.

   -- B1 rating for the $1.4 billion second lien notes, due 2011,
      issued by European Holdings

   -- B2 rating for the $725 million third lien notes, due 2013,
      issued by European Holdings

   -- B3 rating for the $700 million senior unsecured notes, due
      2023 - 2096, issued by Crown Cork & Seal Company, Inc.

   -- B3 rating for the $200 million (net of buybacks) senior
      unsecured notes, due 2006 issued by Finance PLC

   -- B2 senior implied rating at Crown Cork & Seal Company, Inc.

   -- SGL-1 Speculative Grade Liquidity Rating at Crown

   -- Caa1 senior unsecured issuer rating (non-guaranteed
      exposure) at Crown Cork & Seal Company, Inc.

Crown Holdings, Inc., and its subsidiaries are leading global
manufacturers of rigid packaging for consumer products.  It
supplies steel and aluminum containers and metal and plastic caps,
closures, and dispensing systems to the food, beverage, and
consumer products end markets.  Headquartered in Philadelphia,
Pennsylvania, annual revenue is approximately $7 billion.


DELTA AIR: CEO Grinstein Urges Senate to Pass Pension Funding Law
-----------------------------------------------------------------
Delta Air Lines' (NYSE: DAL) CEO Gerald Grinstein joined airline
industry colleagues and others to provide testimony to the U.S.
Senate Committee on Finance at a special hearing on the topic:
"Preventing the Next Pension Collapse: Lessons from the United
Airlines Case."  In his testimony, Mr. Grinstein called for a
practical and affordable approach to solving the airline pension
funding crisis.  He also urged the Senate to pass S. 861, the
"Employee Pension Preservation Act of 2005," introduced by
Senators Johnny Isakson (R-GA) and Jay Rockefeller (D- WVA).

"The pension situation has grown even more urgent since US Airways
and United Airlines shed almost $15 billion in pension
obligations," Mr. Grinstein said.  "These moves place additional
competitive pressure on Delta and other airlines facing large,
immediate funding contributions at a time when we can least afford
them."

Under current legislation, funding requirements for employee
pension benefits must be met within an unreasonably short time
period, making them so unaffordable that they threaten the
viability of the airlines that offer them, said Mr. Grinstein.
When this happens, airlines have the option to hand over the
funding of their pension obligations to the Pension Benefit
Guarantee Corporation (PBGC).

"As a result, airlines are at a crossroads. Without changes to the
current rule, airlines will almost certainly be forced into
bankruptcy and have to transfer additional pension liabilities to
the PBGC," said Mr. Grinstein.  "Alternatively, if Congress
chooses to move swiftly to pass legislation that provides a
manageable, affordable pension funding schedule, airlines will
have a far greater chance to stay out of court and continue the
business transformation the new marketplace requires."

Mr. Grinstein explained that the proposed legislation, S. 861,
would allow airlines to extend their required pension payments and
make them on a more manageable schedule, using more stable, long-
term assumptions.  In return, any airline that chooses this option
would agree to limit its pension liabilities by freezing pension
benefits, or by funding pension liabilities in the year that they
occur.  Airlines could choose to offer more manageable pension
plans, such as a 401(k), but it would be a "pay as you go"
solution.

Let me state clearly that "Delta is seeking a solution, not a
subsidy," said Mr. Grinstein.  "We are pursuing a course that
significantly limits additional PBGC liabilities and allows us to
continue funding the benefits our employees and retirees have
earned."

Delta believes that S. 861 offers a workable solution for pension
reform, balancing the interests of all parties:

   -- Employees and retirees would have a greater chance of
      receiving the full pension benefits they have earned rather
      than see those benefits reduced, perhaps significantly, in a
      transfer of liabilities to the PBGC;

   -- By making it less likely that airlines will transfer
      additional unfunded liabilities, S. 861 decreases the risk
      of a taxpayer-funded bailout of the PBGC;

   -- S. 861 would benefit the traveling public by providing a
      solution that supports the stability in the nation's air
      transportation system as the airline industry undergoes
      massive change; and

   -- S. 861 would benefit Delta and other airlines by removing
      the most enormous barrier to the ability to access capital
      markets, a key component in completing a transformation
      process outside of bankruptcy.

"The decisions made now about the pension funding crisis will be
far reaching and profound," said Mr. Grinstein.  "They will affect
the future of airline employees and retirees, the PBGC, the
traveling public, and the major network airlines that -- despite
financial challenges -- continue to serve as the backbone of our
nation's air transportation system."

Delta Air Lines -- http://delta.com/-- is the world's second-
largest airline in terms of passengers carried and the leading
U.S. carrier across the Atlantic, offering daily flights to 490
destinations in 85 countries on Delta, Song, Delta Shuttle, the
Delta Connection carriers and its worldwide partners.  Delta's
marketing alliances allow customers to earn and redeem frequent
flier miles on more than 14,000 flights offered by SkyTeam and
other partners.  Delta is a founding member of SkyTeam, a global
airline alliance that provides customers with extensive worldwide
destinations, flights and services.

At March 31, 2005, Delta Air's balance sheet showed a $6.6 billion
stockholders' deficit, compared to a $5.8 billion deficit at
Dec. 31, 2004.


DEVON MOBILE: Judge Walsh Closes Chapter 11 Cases
-------------------------------------------------
As reported in the Troubled Company Reporter on April 25, 2005,
Buccino & Associates, Inc., as the Liquidation Trustee in Devon
Mobile Communications, LP, and its debtor-affiliates' Chapter 11
cases, asked Judge Peter J. Walsh of the U.S. Bankruptcy Court for
the District of Delaware to suspend the Devon Debtors' Chapter 11
proceedings.

The Devon Trustee believed that a suspension could enable it to
pursue a lawsuit against the ACOM Debtors.  On June 21, 2004, the
Devon Trustee commenced an adversary proceeding against the ACOM
Debtors in the U.S. Bankruptcy Court for the Southern District of
New York.  Filed on behalf of the Devon Debtors, the Liquidating
Trust and the Devon Estate, the Devon Trustee Action asserts
claims for, inter alia, fraud, fraudulent misrepresentation,
preference, alter ego, deepening insolvency, breach of contract,
breach of duty to fund and breach of fiduciary duties.

However, at the U.S. Trustee's request, Judge Walsh entered an
order closing the Devon Debtors' Chapter 11 cases.

Michael R. Nestor, Esq., at Young, Conaway Stargatt & Taylor,
LLP, in Wilmington, Delaware, told The Deal that the Trustee
agreed to close the Devon Debtors' Chapter 11 cases because there
was no need to keep it open.  "The reorganization plan has been
substantively consummated," he told Shanon D. Murray, a reporter
for The Deal.

Judge Walsh rules that the Devon Debtors' Chapter 11 proceedings
will be automatically reopened upon the earlier to occur of:

    (a) a request by parties-in-interest, or

    (b) 30 days after entry of a final non-appealable judgment of
        the Adelphia lawsuit.

Devon Mobile Communications filed for Chapter 11 protection on
August 19, 2002 (Bankr. D. Del. Case No. 02-12431).  Lawyers at
Saul Ewing, LLP, represent the Debtor.  Devon is 49% owned by
Adelphia Communications Corporation.  (Adelphia Bankruptcy News,
Issue No. 95; Bankruptcy Creditors' Service, Inc., 215/945-7000)


DIGITAL VIDEO: Ex-CEO Mali Kuo Returns to Lead Company
------------------------------------------------------
Digital Video Systems, Inc., or DVS, (Nasdaq: DVIDE) named former
CEO and Co-Chairman, Mali Kuo, to once again lead the company.
Ms. Kuo has been elected as its new CEO and Chairman of the Board.
The Company has also appointed Dean Clarke Seniff as its CFO and
Shaun Kang as its President.  DVS has also added three new members
to its Board of Directors.

Ms. Kuo and her investors had previously invested approximately
$15 million in the Company between the end of 1998 and 2001, and
had turned the Company profitable in 2000 and 2001.  As previously
announced, Ms. Kuo has settled her $3.42 million dollar judgment
against the Company and pledged to raise an additional $25 million
in equity financing.

The terms of the settlement include:

   -- the issuance of 8% preferred stock to creditors of Ms. Kuo;
      and

   -- the issuance of one year warrants for 100,147 shares of
      common stock exercisable at $4.50 per share.

In connection with the settlement, the Company agreed to register
with the Securities and Exchange Commission the 1,001,470 shares
of common stock issuable upon the conversion of the 8% preferred
stock.  The preferred stock automatically converts to 1,001,470
shares of common stock when the SEC declares the registration
statement effective.

Discussing her near-term goals Ms. Kuo stated, "As CEO and
Chairman of Digital Video Systems, Inc., I will work with our
restructured Board of Directors and new executives to properly
capitalize DVS and return to profitability."

Dean Clarke Seniff has over 25 years international business
experience, including Asian operations.  Since 2002 he has served
in interim chief financial officer positions and as a consultant
to both public and private companies.  Mr. Seniff's experience
includes merger and acquisitions, supply chain, demand planning
and forecasting, product life cycle management, and debt and
equity financing.  In addition, he has held various corporate
positions with such companies as PepsiCo, Amerada Hess and
Schlumberger Ltd.  Mr. Seniff graduated from George Washington
University with a degree in accounting and started his career with
Ernst & Whinney in 1980.

Shaun Kang brings over 23 years of international sales and
marketing experience of electronic products to DVS.  During the
last 5 years while serving as the President of the Company's U.S.
sales organization, DVS Sales, Inc., Mr. Kang has been
instrumental in developing the Company's growing automotive
business, having brought in a number of Tier 1 automotive accounts
to DVS.  Ms Kuo said, "Mr. Kang has previously been involved in
the launching of a number of successful products for Hyundai
Electronics.  Over the years, he has developed business
relationships with many of the world's best known companies such
as Toshiba, Compaq, Bull, Zenith, and Nokia."  Mr. Kang received
his MBA from Oklahoma City University.

                         Board Changes

At a Board of Directors meeting on May 24, 2005, the Board voted
to expand from four to seven members.  The new members, Ms. Kuo,
Jeff Bumb -- Vice-President and CFO of Vector Fabrication, Inc.,
and Bruce Breslow, former Mayor and Nevada State Commissioner,
bring new excitement and vision to the Company, as well as
valuable business experience and relationships in Asia that can
provide near term benefits to the Company.  Mr. Bumb noted "Mali's
leadership and ability to open the doors to new investors and
business partners, particularly in Asia, means that DVS will once
again be able to stand on firm financial ground and focus on
developing new cutting edge technology and products."

During his two-terms as mayor of Sparks, Nevada, Bruce Breslow
played an instrumental role in the revitalization of the city.
Thereafter, Mr. Breslow was appointed by Nevada Governor Kenny
Guinn as a Transportation Services Authority Commissioner and as
Chairman of the Employee Management Committee.  Mr. Breslow
observed "With Ms. Kuo's proven ability to provide strong
financial support, the Company can now return its focus to growth
and development from a position of strength. Ms. Kuo has proven
she can raise capital and run a profitable company and I'm
confident she'll be able to strengthen DVS once again."

                About Digital Video Systems, Inc.

Established in 1992, Digital Video Systems, Inc. --
http://www.dvsystems.com/-- is a publicly held company
specializing in the development and application of digital video
technologies enabling the convergence of data, digital audio,
digital video and high-end graphics.  DVS is headquartered in Palo
Alto, California, with subsidiaries and manufacturing facilities
in South Korea and China and a subsidiary in India.

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 27, 2005,
Stonefield Josephson, Inc., raised substantial doubt about Digital
Video Systems, Inc.'s ability to continue as a going concern after
it audited the Company's Form 10-K for the year ended Dec. 31,
2004.  The Company suffered recurring losses from operations and
has a negative working capital and a stockholders' deficit.

"Our continued existence will depend in large part upon our
ability to successfully secure additional financing to fund future
operations," the Company said in its Annual Report.

DVS Chairman and CEO Tom Spanier commented, "We are taking steps
to address our current financial situation, and we continue to
believe we will be successful."

At March 31, 2005, Digital Video's balance sheet showed a
$2,699,000 stockholders' deficit, compared to a $311,000 deficit
at Dec. 31, 2004.


DOCTORS HOSPITAL: Has Until September 5 to Decide on Leases
-----------------------------------------------------------
Doctors Hospital 1997, LP, sought and obtained permission from the
U.S. Bankruptcy Court for the Southern District of Texas, Houston
Division, to extend the time within which the Debtor must assume,
assume and assign or reject unexpired leases of nonresidential
real property to September 5, 2005.

The Debtor has four remaining nonresidential real property leases.

The Debtor believes that it will be able to assess its options
regarding the leases with respect to proposing a plan of
reorganization since the DIP Financing has been approved.

The extension would provide the Debtor with maximum flexibility to
consider whether assuming or rejecting the respective Leases is in
the best interest of the Debtor, the estate and the its creditors
in the context of a plan of reorganization.

Headquartered in Houston, Texas, Doctors Hospital 1997 LP, dba
Doctors Hospital Parkway-Tidwell, operates a 101-bed hospital
located in Tidwell, Houston, and a 152-bed hospital located in
West Parker Road, Houston.  The Company filed for chapter 11
protection on April 6, 2005 (Bankr. S.D. Tex. Case No. 05-35291).
James M. Vaughn, Esq., at Porter & Hedges, L.L.P., represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, it listed total assets of
$41,643,252 and total debts of $66,306,939.


DONNKENNY INC: Court Confirms Second Amended Chapter 11 Plan
------------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York confirmed Donnkenny, Inc., and its
debtor-affiliates' Second Amended Chapter 11 Plan filed on May 27,
2005.

Judge Drain determined that the Plan satisfies the 13 standards
for confirmation stated in Section 1129(a) of the Bankruptcy Code.

Pursuant to the Plan, the Debtors' operations will cease on the
Effective Date.

The CIT Group/Commercial Services, Inc., and other prepetition
lenders under the 1999 Revolving Finance Agreement, will receive a
pro-rata share of the proceeds of the previous sale of the
company's assets.

Holders of other secured claims will receive either the collateral
securing the claim or cash payment over time covering both
principal amount of the claim and interest.  If the Debtors opts
to pay over time, the Secured Claim Holder will retain the liens
on the collateral.

Holders of general unsecured claims take nothing under the Plan.
However, the Credit Agreement Lenders may elect to set aside an
amount from the sale proceeds to be distributed among the General
Unsecured Claim Holders.

Intercompany claims and equity interests will be cancelled.

Headquartered in New York City, Donnkenny, Inc., and its debtor-
affiliates design, import, and market broad lines of moderately
and better priced women's clothing.  The Debtors filed for chapter
11 protection on Feb. 7, 2005 (Bankr. S.D.N.Y. Case Nos. 05-10712
through 05-10716).  Bonnie Steingart, Esq., Kalman Ochs, Esq., and
Christopher R. Bryant, Esq., at Fried, Frank, Harris, Shriver &
Jacobson LLP, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they listed $45,670,000 in total assets and
$100,100,000 in total debts.


DPAC TECHNOLOGIES: Posts $5.7 Million Net Loss in First Quarter
---------------------------------------------------------------
DPAC Technologies Corp. (Nasdaq:DPAC) reported results for its
fourth quarter and fiscal year ended February 28, 2005.

Kim Early, DPAC's Chief Executive Officer stated, "Our rate of
growth has been lower than we had anticipated.  Our revenue growth
depends on the timing of our OEM customers completing their
design, testing and initial launch of their products incorporating
our Airborne products.  Due to this our revenues have been less
consistent and less predictable than we had expected."

Mr. Early continued, "We continue to work on completing our
previously announced merger with QuaTech, Inc. in exchange for
common stock.  We are currently engaged in securing the necessary
financing to close the transaction.  We would expect to file an
S-4 registration statement describing QuaTech and the transaction
shortly after the financing has been committed.  We would then
proceed to seek shareholder approval of the transaction and
proceed to a close later in the summer."

                      Operating Results

For the fourth fiscal quarter, revenues from continuing operations
were $469,000 compared to revenues of $74,000 for the fourth
quarter of the previous year, and 40% higher than the third fiscal
quarter revenues of $334,000.  The Company's net loss from
continuing operations totaled $5.7 million, which includes a non-
cash write-off of goodwill of $4.5 million.  The net loss from
continuing operations for the prior year's fourth quarter was $2.4
million, and did not include a similar goodwill impairment charge,
but did include $871,000 of restructuring charges.

Discontinued operations in the fourth quarter realized a gain of
$237,000, as compared to a loss of $2.1 million, for the previous
year's fourth quarter.  The current year gain resulted primarily
from royalties earned under a license for the sale and manufacture
of IDA products.

Revenues from continuing operations for fiscal year 2005 totaled
$1.4 million as compared to $96,000 for the previous fiscal year,
a period in which the wireless product line was primarily still
under development.  The net loss from continuing operations for
fiscal year 2005 was $10.7 million, compared to a net loss of
$10.8 million, for the prior year.  The net loss from continuing
operations in the current year includes a non-cash write-off of
goodwill of $4.5 million, while the net loss from continuing
operations in the prior year included a $4.8 million non-cash
income tax provision.  The current year loss from continuing
operations includes $665,000 in restructuring charges, primarily
for severance costs, as compared to $871,000 in restructuring
charges in the prior year.

Selling and marketing expenses increased by $1.1 million to $1.9
million for fiscal year 2005 as compared to the prior year, as a
result of increases in spending to launch the Airborne(TM)
wireless product line.  General and administrative expenses for
fiscal year 2005 of $2.6 million decreased by $113,000 from the
previous fiscal year.  Since the Airborne(TM) product line is in
the early stages of introduction to the OEM wireless connectivity
market, revenues are currently composed primarily of development
kits, prototype orders, pre-production quantities, non-recurring
engineering fees and early stage production runs.

The net gain from discontinued operations for fiscal year 2005 was
$238,000, compared to a net loss of $3.1 million, for the previous
fiscal year.  The results of discontinued operations for fiscal
year 2005 include a gain of $721,000 on the sale of assets
resulting from the sales of the memory stacking and IDA product
lines, as well as $518,000 in royalty revenues.  The losses for
the prior fiscal year included a $960,000 charge for the write-off
of Durastack production equipment and a $320,000 charge relating
to a terminated facility lease.

                     About DPAC Technologies

Located in Garden Grove, California, DPAC Technologies provides
embedded wireless networking and connectivity products for
machine-to-machine communication applications.  DPAC's wireless
products are used by major OEMs in the transportation,
instrumentation and industrial control, homeland security, medical
diagnostics and logistics markets to provide remote data
collection and control.  The Company's web site address is
http://www.dpactech.com/

                      Going Concern Doubt

At Feb. 28, 2005, DPAC had total assets of $4.1 million, including
cash and cash equivalents of $2.7 million and assets related to
discontinued operations of $164,000.  This compares to total
assets of $13.1 million at February 29, 2004, with $4.5 million in
cash and cash equivalents and $3.0 million of assets related to
discontinued operations.  Working capital at February 28, 2005 was
$1.5 million compared to $4.3 million at February 29, 2004.  As a
result of the recurring operating losses and anticipated need for
additional capital in the next twelve months, Moss Adams LLP, the
Company's independent registered public accounting firm, has
included a going-concern emphasis paragraph in its auditor's
report on the Company's year end financial statements.


FEDERAL-MOGUL: U.K. Court Not Prepared to Terminate Protocol
------------------------------------------------------------
Simon Freakley, James Gleave and the other partners at Kroll
Limited Corporate Advisory and Restructuring Group, as Joint
Administrators of Federal-Mogul Corporation's U.K. debtor-
affiliates, inform Judge Lyons of the outcome of the hearing to
terminate the Cross-Border Insolvency Protocol.  The hearing was
held on May 13, 2005, before Justice David Richards in the High
Court of Justice, Chancery Division, Companies Court, in England.

As reported in the Troubled Company Reporter on May 24, 2005, the
U.K. Administrators asked the London Court to terminate the
Cross-Border Insolvency Protocol.

In a letter sent to the Bankruptcy Court, the Administrators told
Judge Lyons that the application to terminate is necessary for
them to "begin an orderly realization of the U.K. Debtors'
businesses and assets."  The termination, according to the
Administrators, will ensure that the U.K. Debtors' employees are
clear about who they are responsible to and prospective
purchasers are clear that the Administrators are -- under English
law -- in sole control of the process thereby facilitating smooth
and advantageous sales.

James L. Garrity, Jr., Esq., at Shearman & Sterling LLP, in New
York, tells the Court that "Mr. Justice Richards was not prepared
to direct the Administrators to terminate the Protocol at this
time.  Instead, the U.K. Court directed the Administrators to
vary or revoke, at such time as they think fit, their consent
given pursuant to s.14(4) of the English Insolvency Act 1986 to
the continued exercise by the directors of the U.K. Debtors of
their powers (as given in Clause 3.3 of the Protocol)."

Pursuant to Mr. Justice Richards' direction, the Administrators
have, by service of notice, revoked their consent to the
directors of the U.K. Debtors continuing to exercise any of their
powers.  Notwithstanding the revocation, Mr. Garrity tells the
Court that "the Administrators are, for the time being (and
subject to regular review), content for the directors to continue
fulfilling the role and obligations of the Debtor in Possession
in the Chapter 11 proceedings relating to the UK Debtors."

Mr. Garrity informs Judge Lyons that the Administrators are
communicating with the U.K. resident directors and management
about the way in which day-to-day operational matters concerning
the U.K. Debtors will be handled going forward.

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's largest
automotive parts companies with worldwide revenue of some US$6
billion.  The Company filed for chapter 11 protection on October
1, 2001 (Bankr. Del. Case No. 01-10582).  Lawrence J.
Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at
Sidley Austin Brown & Wood, and Laura Davis Jones Esq., at
Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C.,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
US$10.15 billion in assets and US$8.86 billion in liabilities.
At Dec. 31, 2004, Federal-Mogul's balance sheet showed a US$1.925
billion stockholders' deficit.  At Mar. 31, 2005, Federal-Mogul's
balance sheet showed a US$2.048 billion stockholders' deficit,
compared to a US$1.926 billion deficit at Dec. 31, 2004.
(Federal-Mogul Bankruptcy News, Issue No. 80; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


FIRST UNION: Fitch Affirms Low-B Ratings on $15.5M Mortgage Certs.
-----------------------------------------------------------------
Fitch Ratings upgrades First Union National Bank Commercial
Mortgage Trust's commercial mortgage pass-through certificates,
series 1999-C4:

     -- $42.1 million class C to 'AA+' from 'AA-';
     -- $13.3 million class D to 'AA-' from 'A+';
     -- $28.8 million class E to 'A-' from 'BBB+';
     -- $13.3 million class F to 'BBB' from 'BBB-'.

In addition, Fitch affirms these classes:

     -- $49.6 million class A-1 'AAA';
     -- $447.2 million class A-2 'AAA';
     -- Interest-only class IO 'AAA';
     -- $46.5 million class B 'AAA';
     -- $33.2 million class G 'BB+';
     -- $11.1 million class H 'BB';
     -- $2.2 million class J 'BB-';
     -- $6.6 million class K 'B+';
     -- $8.9 million class L 'B'.

The $8.9 million class M certificates remain at 'CCC'.  Fitch does
not rate the $16.4 million class N certificates.

The ratings upgrades are due to the increase in subordination
levels resulting from loan payoffs and amortization.  As of the
May 2005 distribution date, the pool has paid down 17.8% to $728
million from $885.7 million at issuance.  In addition, 12 loans
(9.5%) have defeased, including the Atriums of Kendall Apartments
loan (3%), which is the third largest loan in the pool.

Four assets (3.7%) are currently in special servicing: three real
estate owned properties (3.2%) and one loan that is current
(0.5%).  The largest specially serviced asset is Gateway Center
(1.6%), an REO retail property located in Federal Way, WA.  The
property is currently 78% occupied and is being marketed for sale.
The second largest specially serviced asset is Grand Court Denver
(1.4%), an REO independent and assisted living facility located in
Denver, CO.  This property is also being marketed for sale, which
is targeted for the end of August 2005.  The Timbers Apartments
loan (0.5%) has remained current and is pending return to the
master servicer.  Losses are expected on the three REO properties.


FLINTKOTE CO: Four Claimants Want Administrative Claims Paid
------------------------------------------------------------
George DeMarco, Michael Zinn, Nick Corcovelos and Dell Jensen, ask
the U.S. Bankruptcy Court for the District of Delaware to compel
The Flintkote Company and its debtor-affiliate to pay not less
than $1,360,000 on account of their administrative expense claims.

The Claimants are owners of approximately 6.08 acres of property
known as Rancho San Bernardino 6 & 7 located West of the
Intersection of S. G. & W. Velarde Street in San Bernardino,
California.

Adjacent to the property was a manufacturing facility that
produced asbestos-containing material previously occupied and
operated by the Debtors.

The Debtors disposed of asbestos and asbestos-containing material
on the property.  As a result, the property has been contaminated.

It is estimated that $1,360,000 is required to remediate the
contamination and satisfy governmental agency claims.

The Claimants have received numerous citations and notices of
violations.  The Debtors are aware of the violation notices and
have received copies.

The asbestos is exposed to the wind, the Claimants say, causing
releases of asbestos into the air, which is an imminent threat to
public health and safety.

Any written objection to the claimants' request must be filed on
or before June 20, 2005, at 4:00 p.m. with the Clerk of Court and
copies must be sent to the Claimants' Counsel:

            Edwards & Angel LLP
            919 North Market Street, Suite 1500
            Wilmington, DE 09801
            Attn: William R. Firth, III, Esq.

A hearing will be held before the Honorable Judith K. Fitzgerald
on June 27, 2005, at 9:00 a.m. to consider the Claimants' request.

Headquartered in San Francisco, California, The Flintkote Company
is engaged in the business of manufacturing, processing and
distributing building materials.  The Company and its affiliate,
Flintkote Mines Limited, filed for chapter 11 protection on April
30, 2004 (Bankr. D. Del. Case No. 04-11300).  James E. O'Neill,
Esq., Laura Davis Jones, Esq., and Sandra G. McLamb, Esq., at
Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C., represent
the Debtors in their restructuring efforts.  When the Debtor filed
for protection from its creditors, it estimated assets and debts
of more than $100 million.


GABLES RESIDENTIAL: Moody's Reviews Ratings for Possible Downgrade
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Gables
Residential Trust (senior unsecured to Ba1) and placed the ratings
under review for possible downgrade.  According to Moody's, this
rating action was prompted by Gables' announcement that it has
entered into an agreement to be acquired by a partnership managed
by ING Clarion Partners.

Under the terms of the agreement, the ING Clarion partnership will
acquire all of Gables' common stock for $43.50/share in cash.  The
total consideration of approximately $2.8 billion includes the
assumption and refinancing of approximately $1.2 billion of
Gables' outstanding debt and preferred shares.  Completion of the
transaction is expected to occur by the end of the third quarter
2005 and is subject to approval by Gables' common shareholders and
certain other customary closing conditions.

Moody's remarked that although the precise capital structure of
Gables subsequent to this transaction is not yet clear, it is
likely that leverage, particularly secured leverage, will increase
materially, while fixed charge coverage will decrease.  Gables
will also likely operate with a more aggressive risk profile as it
is expected to increase development activities - already sizable
at roughly 20% of gross assets - under its new ownership.
Reflecting these risks, Moody's has placed Gables' ratings under
review for possible downgrade.  In its review, Moody's will focus
on Gables' pro forma capital structure (specifically overall
leverage and the use of secured debt) and strategic profile.

Moody's indicated that an upgrade of Gables' ratings is unlikely
given this strategic turn of events, and would require a
demonstrated and sustained commitment to operating with a much
less aggressive financial profile, earmarked by secured debt below
20% of assets, debt and preferred stock at less than half of
assets, and fixed charge coverage comfortably above 2x, with
development as a percentage of assets not above the teens.  A
downgrade from Ba1 would reflect effective leverage of more than
65% of gross assets, a rise in secured leverage to above 50% of
gross assets, an increase in development above 20% of gross
assets, or fully loaded fixed charge coverage below 1.8x.

These ratings were downgraded and placed under review for possible
downgrade:

   * Gables Realty Limited Partnership -- senior unsecured debt to
     Ba1, from Baa3.

   * Gables Residential Trust -- Series C-1 and D preferred stock
     to Ba2, from Ba1; preferred stock shelf to (P)Ba2, from
     (P)Ba1.

Gables Residential Trust [NYSE: GBP] is a multifamily REIT
headquartered in Boca Raton, Florida, USA. As of March 31, 2005,
the REIT had assets of $1.8 billion and equity of $600 million.


GE BUSINESS: Fitch Assigns BB Rating to Class D Certificates
------------------------------------------------------------
Fitch Ratings has issued a presale report on GE Business Loan
Trust, series 2005-1 discussing the rating analysis behind Fitch's
expected ratings on:

     -- Interest-only certificates 'AAA';
     -- Class A-1 certificates 'AAA';
     -- Class A-2 certificates 'AAA';
     -- Class A-3 certificates 'AAA';
     -- Class B certificates 'A';
     -- Class C certificates 'BBB';
     -- Class D certificates 'BB'.

The securities are backed by a pool of conventional small business
loans and Small Business Administration Section 504 Program (SBA
504) loans.  The loans are secured by first liens on owner-
occupied or single tenant retail, office, industrial, or other
commercial real estate.  None of the underlying business loans are
insured or guaranteed by any governmental agency.

The presale report is available to all investors on Fitch's
corporate site, http://www.fitchratings.com/. For more
information about Fitch's comprehensive subscription service Fitch
Research, which includes all presale reports, surveillance, and
credit reports on more than 20 asset-backed securities asset
classes, including collateralized debt obligations , contact
product sales at +1-212-908-0800 or at webmaster@fitchratings.com.


GENERAL MOTORS: CEO Reveals Plan to Cut 25,000 Jobs by 2008
-----------------------------------------------------------
General Motors Corp.'s Chief Executive Officer Rick Wagoner
discussed Company's North American operation's performance during
the annual stockholders meeting.

The company's North American operations incurred a $1.3 billion
net loss in the first quarter.  According to Mr. Wagoner, the
Company's North American business is:

   * highly leveraged from an operating perspective with a high
     structural, or fixed, cost base;

   * experienced lower retail sales;

   * did not achieve a significant, and needed, 100,000 unit year-
     over-year reduction in dealer inventories; and

   * experienced a much weaker sales mix -- fewer high profit
     SUVs, more lower profit cars.

Mr. Wagoner asserted the need to improve the company's products
and its abilities to sell those products.  Another solution
brought forth in the meeting is a cost reduction strategy that
will entail job cuts.

The Cost Reduction Strategy includes:

   * buying low cost materials in the global market; and
   * closing plants to reduce assembly capacity.

According to Mr. Wagoner, the plant closures, which will
eliminate 25,000 jobs by 2008, will help save the company around
$2.5 billion annually.

The Company eliminated 8,000 jobs a year through since 2002, the
Wall Street journal reports.

A full-text copy of the CEO's speech is available at no cost at
http://researcharchives.com/t/s?f

                          UAW Responds

The International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America Vice President Richard
Shoemaker, who directs the UAW General Motors Department, said
"It's one thing to present in a speech specific targets for job
reductions and closing plants by the end of 2008; in reality,
various important factors will come into play -- including the
natural attrition rate, changes in volume and market share and, of
course, the 2007 UAW-GM negotiations.

"The UAW is not convinced that GM can simply shrink its way out of
its current problems. What's needed is an intense focus on
rebuilding GM's U.S. market share, and the way to get there is by
offering the right product mix of vehicles with world-class design
and quality.

"No one has a greater stake in the success of General Motors than
UAW-GM members -- and no one has played a more vital role in GM's
strong gains in productivity and product quality.  They're doing
their part to help GM meet the challenges of today's fiercely
competitive auto industry.  We will do all that is possible to
protect the interests of our members and their families."

                            About UAW

The International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America is one of the largest
and most diverse unions in North America, with members in every
sector of the economy.

UAW-represented workplaces range from multinational corporations,
small manufacturers and state and local governments to colleges
and universities, hospitals and private non-profit organizations.

The UAW has approximately 710,000 active members and over 500,000
retired members in the United States, Canada and Puerto Rico.

There are more than 950 local unions in the UAW.

                      About General Motors

General Motors Corporation, the world's largest auto manufacturer,
designs, manufactures, and markets vehicles primarily in North
America under these nameplates: Chevrolet, Pontiac, GMC,
Oldsmobile, Buick, Cadillac, Saturn, and HUMMER.

                         *     *     *

As reported in the Troubled Company Reporter on May 25, 2005,
Fitch Ratings has downgraded the senior unsecured ratings of
General Motors, GMAC and the majority of affiliated entities to
'BB+' from 'BBB-'.  Fitch says the Rating Outlook for GM remains
Negative.

As reported in the Troubled Company Reporter on May 6, 2005,
Standard & Poor's Ratings Services lowered its long- and short-
term corporate credit ratings on General Motors Corp., General
Motors Acceptance Corp., and all related entities to 'BB/B-1' from
'BBB-/A-3'.  S&P says the rating outlook is negative.

As reported in the Troubled Company Reporter on Apr. 11, 2005,
Moody's Investors Service lowered the long-term and short-term
ratings of General Motors Corporation to Baa3 and Prime-3 from
Baa2 and Prime-2, and also lowered the long-term rating of General
Motors Acceptance Corporation to Baa2 from Baa1.   GMAC's short-
term rating is affirmed at Prime-2.  Moody's says the rating
outlook for both companies is negative.  These rating actions
conclude Moody's review for downgrade that commenced on March 16
following GM's announcement of a significant negative revision of
its 2005 earnings and cash flow outlook.


GREAT NORTHERN: Hires Evan Migdail as Tax Counsel
-------------------------------------------------
Gary M. Growe, the chapter 7 trustee overseeing the liquidation of
Great Northern Paper, Inc., sought and obtained permission from
the U.S. Bankruptcy Court for the District of Maine, to hire Evan
Migdail, Esq., and the law firm of DLA Piper Rudnick Gray Cary US
LLP as special Washington Tax Counsel.

Mr. Migdail and DLA Piper Rudnick will assist the Trustee in
prosecuting tax refund claims in Washington.  Mr. Migdail has
extensive tax law experience both in the legislative area and in
substantive representation of clients in controversies before the
Internal Revenue Service, and at the highest policymaking levels
at the Department of the Treasury.

Mr. Migdail will charge the Debtor $565 per hour for his services.
DLA Piper Rudnick's hourly fees range from $150 to $750 per hour.

To the best of the Trustee's knowledge, Mr. Migdail and DLA Piper
Rudnick do not hold interests adverse to the Debtor or its estate.

Great Northern Paper, Inc., one of the largest producers of
groundwood specialty papers in North America, filed for chapter 11
protection on January 9, 2003 (Bankr. Maine Case No. 03-10048).
The court converted the Debtor's case to a Chapter Seven
proceeding on May on May 22, 2003.  Alex M. Rodolakis, Esq., and
Harold B. Murphy, Esq., at Hanify & King, P.C., represent the
Debtor in its restructuring efforts.  When the Company filed for
protection from its creditors, it listed debts and assets of more
than $100 million each.


HERCULES OFFSHORE: S&P Rates Proposed $130 Mil. Term Loan at B-
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' corporate
credit rating to Hercules Offshore LLC.

Standard & Poor's also assigned its 'B-' rating and '4' recovery
rating to the company's proposed $130 million term loan B due
2010, indicating the expectation of marginal (25%-50%) recovery of
principal in the event of a payment default.

The outlook is stable.  As of June 1, 2005, Houston, Texas-based
Hercules had total debt of about $130 million, pro forma for the
term loan B.

Proceeds from the note offering will primarily be used to repay
$101 million of current bank debt.  The company will also use $20
million toward the acquisition of the Jupiter 170-foot cantilever
jack-up rig from Transocean Inc.

"The rating on the company reflects its vulnerable business
profile due to its small, lower specification jack-ups and lift
boats and its geographic concentration in the shallow waters of
the Gulf of Mexico," said Standard & Poor's credit analyst Brian
Janiak.

"These weaknesses are slightly mitigated by the company's adequate
near-term liquidity to meet capital spending and debt service in
the current favorable market utilization and day rate
environment," said Mr. Janiak.

Hercules is a niche provider of shallow-water drilling and
liftboat services to the oil and natural gas exploration and
production industry in the U.S. Gulf of Mexico.


HIGH VOLTAGE: Ch. 11 Trustee Taps Houlihan Lokey as Fin'l Advisor
-----------------------------------------------------------------
Stephen S. Gray, the Chapter 11 Trustee overseeing High Voltage
Engineering Corporation and its debtor-affiliates' bankruptcy
estates, asks the U.S. Bankruptcy Court for the District of
Massachusetts for permission to employ Houlihan Lokey Howard &
Zukin Capital as his financial advisor.

Mr. Gray wants to employ Houlihan Lokey in connection with the
proposed post-petition sale, merger or other combination or
disposition of substantially all of the assets or a majority of
capital stock of one or more of the Debtor's business groups,
including:

   a) Robicon Corporation,
   b) ASIRobicon S.p.A.,
   c) High Voltage Engineering Coporation B.V., and
   d) Evans Analytical Group

Houlihan Lokey will:

   a) review the business group's financial position, financial
      history, operations, competitive environment, and assets;

   b) assist the Debtors in determining the best means and timing
      to effect a sale of the business groups in one or a series
      of transactions with any person or entity;

   c) develop a list of potential acquirers, investors and
      strategic partners and interact with investors in an effort
      to create interest in one or more sale transactions;

   d) prepare one or more offering memoranda, with substantial
      input from the Debtors, to provide to interested investors;

   e) develop a coordinated sales effort;

   f) solicit and evaluate indications of interest and proposals
      regarding a sale transaction;

   g) advise the Debtors as to the structure of sale transactions;

   h) assist in negotiation and structuring of the financial
      aspects of each propose sale transaction; and

   i) submit and discuss the offering memoranda with interest
      parties, coordinate the negotiating process with the Debtors
      and their other advisors, actively participate in
      negotiations, and otherwise reasonably assist the Debtors
      in effectuating each sale transaction.

The Firm will be compensated for the reasonable fees and expenses
of its counsel, up to an aggregate maximum of $50,000.  Moreover,
Houlihan Lokey will receive a cash transaction fee from the
Debtors equal to:

   a) upon the closing or consummation of a sale transaction
      concerning Robicon Corporation, $1,000,000, plus

   b) upon the closing of consummation of the first sale
      transaction concerning any business group or portion
      thereof other than Robicon or ASIRobicon, $400,000, plus

   c) upon the closing or consummation of each subsequent sale
      transaction concerning any business group or portion
      thereof other than Robicon or ASIRobicon, $300,000, plus

   d) upon the closing or consummation of a sale transaction
      concerning ASIRobicon that is separate from the sale
      transaction, the lessor of $200,000 and 5% of the
      total proceeds of sale transaction concerning ASIRobicon
      received by the Debtors or any holder or holders of any
      claims against or equity interests in the Debtors, but only
      in their respective capacities as such, plus

   e) 2% of the total proceeds received by the Debtors or any
      holder or holders of any claims against or equity interests
      in the Debtors, but only in their respective capacities as
      such, in connection with the sale transactions between
      $70 million and $90 million, plus 4% of the aggregate gross
      consideration in excess of $90 million.

To the best of the Trustee's knowledge, Houlihan Lokey does not
represent any interest adverse to the Debtors or their estates.

Headquartered in Wakefield, Massachusetts, High Voltage filed its
second chapter 11 petition on Feb. 8, 2004 (Bankr. Mass. Case No.
05-10787).  Douglas B. Rosner, Esq., at Goulston & Storrs,
represents the Debtors in their restructuring efforts.  In the
Company's second bankruptcy filing, it listed $457,970,00 in total
assets and $360,124,000 in total debts.  Stephen S. Gray is the
Chapter 11 Trustee for the Debtors' estates.  John F. Ventola,
Esq., at Choate, Hall and Stewart represents the Chapter 11
Trustee.


IRWIN WHOLE: Fitch Puts BB+ Rating on $1.7M Class 2B-1 Certs.
-------------------------------------------------------------
Irwin Whole Home Equity Loan Trust's loan-backed notes, series
2005-B are rated by Fitch Ratings:

     -- $87.1 million class 2A-1 and 2A-R 'AAA';
     -- $7.7 million class 2M-1 'AA';
     -- $6.1 million class 2M-2 'A';
     -- $4.4 million class 2M-3 'BBB
     -- $1.5 million class 2M-4 'BBB-';
     -- $1.7 million class 2B-1 'BB+'.

The 'AAA' rating on the class 2A-1 certificate reflects the 22.05%
credit enhancement provided by the 7.10% class 2M-1, 5.60% class
2M-2, 4.06% class 2M-3, 1.35% class 2M-4 and 1.60% class 2B-1, as
well as the 2.35% target overcollateralization.  All certificates
have the benefit of monthly excess cash flow to absorb losses.
The ratings reflect the integrity of the transaction's legal
structure, as well as the capabilities of Irwin Union Bank and
Trust Company as the servicer.  Wilmington Trust Company will act
as owner trustee.

As of the cut-off date, the group two mortgage loans are first and
second lien adjustable-rate home equity lines of credit have an
aggregate balance of $108,459,977.  The weighted average loan rate
is approximately 7.434%.  The weighted average remaining term to
maturity is 229 months.  The average cut-off date principal
balance of the mortgage loans is approximately $51,774.98.  The
weighted average original loan-to-value ratio is 88.94%, and the
weighted average Fair, Isaac & Co. score was 702.  The properties
are primarily located in California (36.29%), Colorado (7.51%),
and Maryland (6.54%).

The mortgage loans were originated or acquired by Irwin Union Bank
and Trust Company.  Irwin Union Bank and Trust Company is a
specialty finance company engaged in the business of originating,
purchasing, and selling retail and wholesale subprime mortgage
loans.


ISTAR ASSET: Prepayment Cues Fitch to Lift Ratings on 11 Classes
----------------------------------------------------------------
Fitch Ratings upgrades iStar Asset Receivables (STARs) Trust,
commercial mortgage pass-through certificates, series 2002-1:

     -- $21.3 million class G to 'AAA' from 'AA+';
     -- $26.6 million class H to 'AAA' from 'AA-';
     -- $26.6 million class J to 'AA+' from 'A+';
     -- $26.6 million class K to 'AA' from 'A';
     -- $21.3 million class L to 'AA-' from 'A-';
     -- $18.6 million class M to 'A' from 'BBB';
     -- $24.0 million class N to 'A-' from 'BBB-';
     -- $21.3 million class O to 'BBB-' from 'BB+';
     -- $18.6 million class P to 'BB+' from 'BB';
     -- $16.0 million class Q to 'BB-' from 'B+';
     -- $16.0 million class S to 'B+' from 'B'.

In addition, Fitch affirms these classes:

     -- $108.2 million class A-2 at 'AAA';
     -- $40.0 million class B at 'AAA';
     -- $26.6 million class C at 'AAA';
     -- $21.3 million class D at 'AAA';
     -- $42.6 million class E at 'AAA';
     -- $26.6 million class F at 'AAA'.

Class A-1 has paid in full.

Fitch does not rate the $40 million class T.

The upgrades are the result of increased credit enhancement after
the prepayment of six loans since Fitch's last rating action and
improved performance.  Since issuance, the trust has paid down
$542.4 million, or 49.1% as of the May 2005 distribution.

The certificates are collateralized by 24 loans on 38 commercial
properties consisting mainly of office (37%) and industrial (30%).
The largest geographic concentrations are in Massachusetts (20%)
and Illinois (18%).  The portfolio has limited property-type and
geographic diversity, which has been accounted for through
additional stresses in the remodeling of the mortgage pool.

Fitch analyzed the performance of each loan and its underlying
collateral.  The debt service coverage ratio is calculated using
borrower reported net operating income adjusted for reserves and
capital expenditures and a Fitch stressed debt service constant.
The fiscal year ended 2004 DSCR for the comparable loans in the
pool was 1.71 times (x) compared to 1.42x at issuance.

Three loans maintain the investment grade credit assessments
assigned at issuance and represent 60.2% of the pool compared to
37.0% at issuance.

Headquarters/Mission-Critical Facilities (31.3%) is secured by 15
cross-collateralized and cross-defaulted first mortgage loans.
The properties include nine office, five industrial, and two
office/industrial properties located in 10 states.  Major tenants
include Nike, Inc., Eagle Global Logistics, and IBM.  As of fiscal
year-end 2004 the portfolio was 98% leased.  The loan portfolio
has experienced improved performance with fiscal year-end 2004
DSCR of 1.73x compared to 1.63x at fiscal year-end 2003 and 1.41x
at issuance.

Similar to issuance, Fitch underwrote a sample of the portfolio
and applied a haircut to fiscal year-end 2004 NOI for the
remaining seven loans.  Although many of the properties are leased
to non-rated single tenants, the loan portfolio benefits from a
20-year amortization schedule, geographic diversity, and cross-
collateralization and cross-default provisions.

The Goodyear Tire & Rubber Company Loan (18.0%) is secured by six
industrial warehouse properties located in five states.  The
properties are 100% occupied by Goodyear Tire & Rubber Company
under a single, non-cancelable 20-year lease that commenced in
December 2001.  The lease is triple-net and includes a rent
increase in January 2012.  A $20 million letter of credit issued
by BNP Paribas, rated 'AA' by Fitch, serves as additional
collateral for the loan.  Performance has improved, driven by
increased income, with DSCR of 1.89x at fiscal year-end 2004
compared to 1.81x at fiscal year-end 2003 and 1.62x at issuance.

Chelsea Piers (10.9%) is secured by a 30-acre 1.7 million square
foot (SF) entertainment/mixed-use complex in Manhattan, New York.
The Chelsea Piers mortgage is subject to a ground lease with the
State of New York Department of Transportation.  The first renewal
period commenced in June 2004 for an additional 10 years.  The
lease has two additional 10-year renewal periods remaining.  While
the property's performance has declined slightly since issuance
with a fiscal year-end 2004 DSCR of 1.94x compared to 2.00x at
issuance, it has improved over fiscal year-end 2003's DSCR of
1.60x. As of fiscal year-end 2004, the property was 99.3% leased.

The seven non-credit assessed loans in the pool consist of first
mortgage, second mortgage, third mortgage, and mezzanine loans.
These assets continue to perform well with an all-in DSCR of
1.54x.


KEY ENERGY: Trustee Issues Default Notice on Reporting Covenants
----------------------------------------------------------------
Key Energy Services, Inc. (OTC Pink Sheets: KEGS) received notice
from the trustee that the Company is in breach of the financial
reporting covenants contained in the indentures of its 8.375%
Senior Notes due 2008 and 6.375% Senior Notes due 2013, and
stating that unless the deficiency is remedied within 60 days, an
event of default would occur under the indentures.

Unless the deficiency is cured or waived within the 60-day cure
period (before August 5, 2005), the trustee or holders of 25% of
the outstanding principal amount of either series of notes will
have the right to accelerate the maturity of that series of notes.
The default notice pertains to the failure of the Company to file
its Annual Report on Form 10-K for the year ending December 31,
2003, by the May 31, 2005, deadline.  Under terms of the most
recent consents by the noteholders, the Company has until July 31,
2005, to file its Annual Report on Form 10-K for the year ending
Dec. 31, 2004, and until Aug. 31, 2005, to file its Quarterly
Reports on Form 10-Q for 2005.

                 Back-Stop Financing Commitment

The Company previously disclosed a $550 million financing
commitment from Lehman Brothers Inc. and Lehman Commercial Paper,
Inc. in the event the Company elects or is required to refinance
any or all of its senior secured credit facility, its 6.375%
Senior Notes due 2013 or its 8.375% Senior Notes due 2008.  The
Back-Stop Facilities include a seven-year $400 million Term Loan
Facility, a pre-funded five-year $85 million Letter of Credit
Facility and a five-year $65 million Revolving Credit Facility
(including a $25 million sub-facility for additional letters of
credit).  In the event the Company draws upon the Back- Stop
Facilities, the Company anticipates that the interest rate on the
Back- Stop Facilities will be slightly higher than the interest
rates on its existing senior secured credit facility.
Additionally, the Company will pay commitment fees and in the
event funding occurs, the Company will pay a funding fee based on
the amount funded.  Loans under the facilities will be guaranteed
by the Company's material, domestic subsidiaries and will be
secured by liens on substantially all of the assets of the Company
and its domestic subsidiaries.  The commitment for the Back-Stop
Facilities will expire on December 31, 2005.

                        About Key Energy

Key Energy Services, Inc., is the world's largest rig-based,
onshore well service company.  The Company provides diversified
energy operations including well servicing, contract drilling,
pressure pumping, fishing and rental tool services and other
oilfield services.  The Company has operations in all major
onshore oil and gas producing regions of the continental United
States and internationally in Argentina and Egypt.

                         *     *     *

As reported in the Troubled Company Reporter on April 1, 2005, the
Company obtained a waiver from the lenders under its revolving
credit facility:

  (x) extending to April 30, 2005, the date by which the Company
      must deliver audited financial statements for 2003,

  (y) extending until June 30, 2005, the date by which the Company
      must deliver quarterly financial statements and audited
      financial statements for 2004, and

  (z) extending until August 31, 2005, the date by which the
      Company must deliver quarterly financial statements for the
      quarters ended March 31, 2005, and June 30, 2005.

In late-March, the company said last week that it was talking to a
representative of the bondholders for a waiver of the financial
reporting delay.  The Company has not said whether it obtained a
waiver from that representative.  The company has two public bond
issues outstanding:

     * $150,000,000 of 6-3/8% Senior Notes due May 1, 2013; and
     * $275,000,000 of 8-3/4% Senior Notes due March 1, 2008.

The Company also said it received waivers from three of its
primary equipment lessors.


MAGRUDER COLOR: Wants to Hire Lowenstein Sandler as Bankr. Counsel
------------------------------------------------------------------
Magruder Color Company, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of New Jersey for
permission to employ Lowenstein Sandler PC as its general
bankruptcy counsel.

Lowenstein Sandler is expected to:

   a) provide the Debtors with legal advice in preparing all
      necessary documents regarding debt restructuring, bankruptcy
      and asset dispositions;

   b) take all necessary actions to protect and preserve the
      Debtors' estates during the pendency of their chapter 11
      cases, including the prosecution of actions by the Debtors,
      the defense of actions commenced against the Debtors,
      negotiations concerning litigation in which the Debtors are
      involved and objecting to claims filed against the estates;

   c) prepare on behalf of the Debtors, as debtors-in-possession,
      all necessary motions, applications, answers, orders,
      reports and papers in connection with the administration of
      the Debtors' chapter 11 cases;

   d) advise the Debtors with regard to their rights and
      obligations as debtors-in-possession in the continued
      operation and management of their businesses and property;

   e) appear in Bankruptcy Court to protect the interests of the
      Debtors before that Court; and

   f) perform all other legal services for the Debtors which
      may be necessary and proper in their bankruptcy proceedings.

Bruce D. Buechler, Esq., a Member at Lowenstein Sandler, is the
lead attorney for the Debtors.  Mr. Buechler discloses that the
Firm received $73,200 retainer.

Mr. Buechler Lowenstein Sandler's professionals bill:

      Designation         Hourly Rate
      -----------         -----------
      Members             $300 - $575
      Senior Counsel      $275 - $395
      Counsel             $250 - $350
      Associates          $160 - $295
      Legal Assistants     $75 - $150

Lowenstein Sandler assures the Court that it does not represent
any interest materially adverse to the Debtors or their estates.

Headquartered in Elizabeth, New Jersey, Magruder Color Company --
http://www.magruder.com/-- and its affiliates manufacture basic
pigment and also supply quality products to the ink, paint, and
plastics industries.  The Company and its debtor-affiliates filed
for chapter 11 protection on June 2, 2005 (Bankr. D.N.J. Case No.
05-28342). When the Debtors filed protection from their creditors,
they estimated assets and debts of $10 million to $50 million.


MAGRUDER COLOR: Wants to Hire San Filippo as Financial Advisors
---------------------------------------------------------------
Magruder Color Company, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of New Jersey for
permission to employ San Filippo & Associates as their financial
advisors.

San Filippo is expected to:

   a) act as the primary contact for all suitors interested
      in acquiring the Debtors' assets and analyze and make
      recommendations to the Debtors with respect to any offers
      from those suitors;

   b) provide financial analysis related to proposed asset
      sales and review all financial information prepared by the
      Debtors, including financial statements showing in detail
      all assets and liabilities;

   c) monitor the Debtors' activities regarding cash
      expenditures, receivables collection, asset sales and
      projected cash requirements;

   d) provide financial analysis for any business plans, cash
      flows, asset sales or plans of reorganization and
      accompanying disclosure statements;

   e) provide assistance in communications with the
      Court and the U.S. Trustee, including
      preparation of analysis and reports as may be
      required by parties-in-interest;

   f) review the Debtors' periodic operating and cash
      flow statements and provide expert testimony regarding
      work performed as may be requested;

   g) review the Debtors' books and records for various
      transactions, including related party transactions,
      potential preferences, fraudulent conveyances and
      other potential prepetition investigations;

   h) provide all other financial advisory and consulting
      services as may be requested by the Debtors or their
      counsel to facilitate their chapter 11 cases.

Steven A. San Filippo, a Director at San Filippo, discloses that
the Firm received a $90,000 retainer.  Mr. Filippo will charge
$400 per hour for his services.

Mr. Filippo discloses that in the event of any consummated sale of
assets or stock during San Filippo's engagement by the Debtors,
the Firm will be paid with a Transaction Fee equal to 1% of the
aggregate value of the assets sold and liabilities assumed by the
buyer for those assets.

Mr. Filippo reports San Filippo's professionals bill:

             Designation      Hourly Rate
             -----------      -----------
             Associates       $100 - $250
             Analysts          $75 - $150

San Filippo assures the Court that it does not represent any
interest materially adverse to the Debtors or their estates.

Headquartered in Elizabeth, New Jersey, Magruder Color Company --
http://www.magruder.com/-- and its affiliates manufacture basic
pigment and also supply quality products to the ink, paint, and
plastics industries.  The Company and its debtor-affiliates filed
for chapter 11 protection on June 2, 2005 (Bankr. D.N.J. Case No.
05-28342).  Bruce D. Buechler, Esq., at Lowenstein Sandler PC
represent the Debtors in their restructuring efforts.  When the
Debtors filed protection from their creditors, they estimated
assets and debts of $10 million to $50 million.


MEDIANEWS GROUP: Good Financial Profile Cues S&P's Stable Outlook
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
newspaper publisher MediaNews Group Inc. to stable from negative.

At the same time, Standard & Poor's affirmed its 'BB' corporate
credit and 'B+' subordinated debt ratings on the Denver, Colorado-
headquartered company.  About $840 million of debt was outstanding
at March 2005.

"The outlook revision reflects an improvement in MediaNews'
financial profile to levels more consistent with the current
ratings as a result of lower debt and interest expense over the
past several years," said Standard & Poor's credit analyst Donald
Wong.  In addition, Standard & Poor's expects that the company
will continue to use its free operating cash flow in a balanced
manner for both debt reduction and acquisitions in the
intermediate term.

Debt was reduced by nearly $120 million from the end of fiscal
2002 to March 2005, while adjusted EBITDA has been relatively
flat.  Interest expense over this period declined about 30%,
reflecting the lower borrowings and the refinancing of the
majority of the company's debt structure in fiscal 2004 and early
fiscal 2005.  The refinancings also pushed out debt maturities.


MICROTEC ENT: March 31 Balance Sheet Upside-Down by C$937,000
-------------------------------------------------------------
Microtec Enterprises Inc. (TSX:EMI) reported its financial results
for the quarter ended on March 31, 2005.

During the first quarter of 2005, revenues were at C$7,168,000,
declined by 4.9% as compared to the corresponding quarter of 2004.
Overall administration, monitoring and customer service expenses,
installation, sales and marketing expenses declined by 5.3% to
$3,352,000.  The net loss totaled C$233,000.

On March 16, 2005, Microtec completed the first step of its plan
with a transaction pursuant to which First National AlarmCap
Income Fund acquired substantially all of the Company's assets and
on Microtec secured creditors were repaid in full.  On April 25,
2005, a plan of arrangement under the CCAA was submitted to
Microtec's other creditors.  This plan was subsequently approved
by the creditors on May 11, 2005 and sanctioned by the Court on
May 12, 2005.  The second step of Microtec plan was then
completed.

Microtec will complete the third and final step of its plan by an
arrangement to be proposed to the Company's shareholders on June
16, 2005.  The arrangement would result in the conversion of each
issued and outstanding share of the Company into a share of
Microtec exchangeable into 0.2501202 Class A trust units of the
Fund.  This exchange ratio was determined on the basis of C$2.50
per Fund units.  An information circular containing a detailed
description of the arrangement has been mailed to shareholders.

Also, the Fund got a conditional approval to list its Class A
trust units on the Toronto Stock Exchange.

Microtec restructuring plan would have allow the repayment of
secured creditors, the implementation of an arrangement for the
other creditors which benefits from their strong support and an
arrangement that allow Microtec's shareholders to realize a value
on their investment.

                           Asset Sale

Microtec and its subsidiaries, excluding 2M Securite Inc.,
completed the sale of substantially all of their assets to First
National AlarmCap LP on March 16, 2005, pursuant to an asset
purchase agreement dated as of March 14, 2005.  The sale of
Microtec's assets was approved by the Superior Court of Qu,bec on
March 15, 2005, pursuant to the Companies' Creditors Arrangement
Act.

                         About Microtec

Established in Canada, Microtec Enterprises Inc., provides a wide
range of security and home automation services that ensure the
protection and well-being of its residential and commercial
customers.  The Company is building on its strong position in the
industry by developing new products and services, expanding its
subscriber base, and creating strategic alliances.

At Mar. 31, 2005, Microtec Enterprises Inc.'s balance sheet showed
a C$937,000 stockholders' deficit, compared to a C$708,000 deficit
at Dec. 31, 2004.


MIDLAND REALTY: Fitch Lifts Rating on $7.7M Class K Certs. to BB
----------------------------------------------------------------
Fitch Ratings upgrades Midland Realty Acceptance Corp.'s
commercial mortgage pass-through certificates, series 1996-C2, as
follows:

     -- $12.8 million class G to 'AAA' from 'AA';
     -- $5.1 million class H to 'AA' from 'A';
     -- $12.8 million class J to 'BBB' from 'BB+';
     -- $7.7 million class K to 'BB' from 'B'.

In addition, Fitch affirms the following classes:

     -- Interest-only class A-EC at 'AAA';
     -- $29.5 million class B at 'AAA';
     -- $28.2 million class C at 'AAA';
     -- $23 million class D at 'AAA';
     -- $7.7 million class E at 'AAA';
     -- $15.4 million class F at 'AAA'.

Fitch does not rate the $10.8 million class L-1 or the interest-
only class L-2 certificates. The class A-1 and class A-2
certificates have paid in full.

The rating upgrades are due to the increase in subordination
levels resulting from loan payoffs and amortization.  As of the
May 2005 distribution date, the pool has paid down 70.1% to $152.9
million from $512.1 million at issuance.  In addition, the pool
has paid down 26.3% since Fitch's last upgrades in January 2005.

Five loans (2.6%) are currently in special servicing, all of which
are current.  These cross-collateralized and cross-defaulted loans
are secured by five Frank's Nursery & Crafts stores located in
Michigan, Minnesota, and New Jersey.  Based on recent appraised
values, minimal losses, if any, are expected on these loans.

Of the 61 loans remaining in the pool, just three (7.3%) remain
locked out from prepayment.  All other loans are free to prepay
with applicable prepayment penalty or yield maintenance charges.


MIRANT CORP: Court Okays $85 Million Wrightsville Power Plant Sale
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas gave
Mirant Corporation (OTC Pink Sheets: MIRKQ) permission to sell its
Wrightsville Power Plant to Arkansas Electric Cooperative
Corporation for $85 million.  Wrightsville is a 548-megawatt
natural gas-fired, combined cycle facility located outside of
Little Rock, Arkansas.  The plant began operations in July 2002.

                    $85,000,000 Deal with AECC

In October 2004, the Mirant Investment Committee, a committee
comprised of the Company's senior management, granted the Debtors
permission to enter into a letter of intent with AECC to
negotiate a definitive agreement on an exclusive basis.  On
Oct. 15, 2004, the parties executed the LOI.  After extensive
negotiations, the parties entered into an Asset Purchase and Sale
Agreement, with a purchase price of $85,000,000 for the Assets.
AECC will assume certain liabilities arising out of the ownership
or operation of the Facility, excluding real and personal
property taxes for any period prior to January 1, 2006.  The Sale
Agreement supersedes and replaces the LOI in its entirety.

The property consists of all of the assets comprising, among other
things,

     (i) the Facility,

    (ii) the real property on which the Facility and the Entergy
         substation are located, and

   (iii) various other assets to be assumed or assigned including,
         certain contracts, permits and easements.

Certain transmission credits associated with the Facility are not
included.

The sale of Wrightsville is consistent with Mirant's strategy to
focus on core assets.  The sale also supports Mirant's goal to
emerge from Chapter 11 as a stronger, more competitive company.

The completion of the sale is contingent on typical conditions to
closing for such a transaction, including certain state and
federal regulatory approvals.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.


MIRANT CORP: Objects to Southern Company's $48,983,612 Claim
------------------------------------------------------------
Mirant Corporation, formerly known as Southern Energy, Inc., was
incorporated in Delaware on April 20, 1993.  From the date of its
incorporation until October 2, 2000, Mirant was a wholly owned
subsidiary of Southern.  Southern spun-off Mirant in 2001.

Mirant and Southern entered into a number of separation
agreements, including:

    (i) a Master Separation and Distribution Agreement;

   (ii) a Transitional Services Agreement;

  (iii) an Indemnification and Insurance Matters Agreement;

   (iv) a Technology and Intellectual Property Ownership and
        License Agreement;

    (v) a Confidential Disclosure Agreement;

   (vi) an Employee Matters Agreement;

  (vii) a Tax Indemnification Agreement; and

(viii) a Registration Rights Agreement.

On December 15, 2003, Southern Company filed 82 separate Proofs of
Claim.  On October 17, 2004, the Debtors objected to the 82
claims.  On November 30, 2004, Southern filed scores of first
amended proofs of claim.

Southern asserts, among other things, claims for indemnification
for certain attorneys' fees and credit support fees.

On January 5, 2005, the Debtors asked the Court to disallow the
First Amended Southern Claims too.

The Debtors and Southern negotiated two stipulations and orders
resolving certain of the Separation Agreements Claims, as well as
Proof of Claim No. 6307 related to certain Southern guaranties,
and deferring adjudication of the remaining claims.

On February 28, 2005, Southern filed a stack of Second Amended
Southern Claims in which Southern restates each of the claims
asserted in the First Amended Southern Claims and asserts claims
based on the Tax Indemnification Agreement between Southern and
the Debtors for $39,375,918.  The total face amount of the Second
Amended Proofs of Claim is $48,983,612.

By this Objection, the Debtors ask Judge Lynn to disallow for all
purposes $5,411,726 of the Second Amended Southern Claims
pursuant to Section 502 of the Bankruptcy Code and the tax
agreements entered into by Southern and the Debtors.

In addition, the Debtors ask the Court to disallow for voting
purposes the portion of the Second Amended Southern Claims not
subject to the Objection against each of the Debtors other than
Mirant.

In the Second Amended Southern Claims, Southern restates each of
the claims asserted in the First Amended Southern Claims and
further asserts that an additional "noncontingent and liquidated"
claim for $39,375,918 has arisen under the Tax Indemnification
Agreement between Southern and the Debtors.  The $39,375,918
consists of $33,964,192 of additional tax and $5,411,726 of
additional interest purportedly attributable to the Debtors and
resulting from the Internal Revenue Service's examination of
Southern and its subsidiaries' consolidated Federal income tax
return for 2000 and 2001.

The Debtors object to the $5,411,726 of additional interest
claimed in the Southern Tax Claims.  The Debtors argue that:

    (a) Southern has not shown that it is entitled to interest
        based on past practices;

    (b) Southern has claimed interest in excess of what it paid to
        the IRS;

    (c) the Southern Tax Claims are not secured, and even if
        secured, are not oversecured;

    (d) Southern wrongfully claims entitlement to postpetition
        interest;

    (e) payment and/or satisfaction of the claims should be
        deferred until the IRS concludes its examination of
        Southern's 2000 and 2001 tax returns; and

    (f) the Second Amended Southern Claims have insufficient
        descriptions and supporting documentation to warrant
        allowance.

For 2000 and 2001, Southern and its subsidiaries filed
consolidated Federal income tax returns.  Generally, a
consolidated Federal income tax return is the tax return of a
commonly controlled and affiliated group of corporations that is
filed in lieu of separate returns.  The IRS examined, and
continues to examine, Southern's 2000 and 2001 consolidated tax
returns.

To date, the IRS has made, and Southern has agreed to, in
coordination with the Debtors, upward adjustments to income on
Southern's 2000 and 2001 consolidated tax returns attributable to
the Debtors in the amounts of $13,650,381 and $82,800,882 for
2000 and 2001.  These IRS income adjustments result in an
increased gross tax liability in the amount of $33,757,9426 as
claimed by Southern to which the Debtors currently do not object
other than for voting purposes.  In addition, Southern allocated
$206,250 of tax to the Debtors from Southern and Southern Company
Services, Inc., under the Tax Allocation Agreement to which the
Debtors currently do not object other than for voting purposes.

With respect to the Amended Southern Claims, the Debtors reserve
the right, after the completion of discovery, to assert that
Southern failed to prosecute its available remedies and defenses
under the Second Amended Southern Claims.  These affirmative
defenses do not constitute an admission that the Second Amended
Southern Claims are not subject to disallowance, the Debtors
emphasize.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 64; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Deutsche Bank Wants Americas Energy Claim Estimated
----------------------------------------------------------------
Deutsche Bank Securities, Inc., believes that one of the most
significant intercompany claims against Mirant Americas, Inc., is
the claim asserted by Mirant Americas Energy Marketing, LP.

Susheel Kirpalani, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
in New York, relates that the MAEM Claim is premised on a
Makewhole Reimbursement Agreement, dated September 1, 2001,
between MAI and MAEM.  Prior to execution of the Makewhole
Agreement, Mirant Corp., agreed to reimburse MAEM for certain
costs arising from:

   (1) MAEM's transition power agreements with Potomac Electric
       Power Company; and

   (2) MAEM's agreements with PEPCO relating to PEPCO's power
       purchase agreements.

Shortly after MAI executed the Purchase Agreements, Mirant Corp.,
"pushed down" its MAEM obligations to MAI, yet remained
secondarily liable for the obligations.  Ms. Kirpalani relates
that MAI did not receive any consideration in exchange for
undertaking the obligations under the Makewhole Agreement.

                 Deutsche Bank Securities' Claims

Deutsche Bank Securities says it is the largest unsecured
creditor of MAI's estate, with claims totaling $45 million plus
interest.  Ms. Kirpalani notes that Deutsche Bank Securities'
Claims against MAI are liquidated and undisputed, while the MAEM
Claim is contingent and unliquidated.

Ms. Kirpalani recounts that the Debtors seek to resolve the MAEM
Claim through substantive consolidation, but have not articulated
the bases for consolidation with any specificity.  Additionally,
the Debtors believe that the disentanglement of MAI from the
Mirant Consolidated Debtors is "an unproductive and inequitable
task that would be harmful to creditors due to the prohibitive
costs and resultant delays associated with such a task."

The Debtors also have been "booking" the MAEM Claim from $499
million to $879 million, but the Claim has neither been allowed
nor liquidated.  Moreover, the Debtors suggest that the failure
to liquidate the MAEM Claim could mean the difference between
MAI's solvency and MAI's consolidation with MAEM and their
ultimate shareholder, Mirant Corp.  According to Ms. Kirpalani,
the legal question, therefore, is whether the alleged complexity
of liquidating the MAEM Claim is a basis for substantive
consolidation, or, instead, the paradigm for estimation.

Given the potential size of the MAEM Claim in relation to other
MAI liabilities and the unquestionable materiality of the MAEM
Claim to MAI creditor recoveries, Deutsche Bank Securities asks
the Court to estimate MAEM Claim for purposes of allowance
pursuant to Section 502(c) of the Bankruptcy Code.

              Estimation of MAEM Claim Is Necessary

Statutory estimation, Ms. Kirpalani argues, was specifically
designed by Congress to procedurally administer the liquidation
of unliquidated and contingent claims whenever adjudication would
be time or cost prohibitive.  Additionally, Ms. Kirpalani
contends, estimation of the MAEM Claim is necessary to remove a
dark cloud of uncertainty looming over the MAI estate, which has
been hindering MAI creditors from understanding the value of
their debtor.

Substantive consolidation, on the other hand, is a judicially
created equitable remedy with the "sole aim" of achieving
"fairness to all creditors."  As a judicial remedy, substantive
consolidation cannot be invoked simply as a time saving measure
because "substantive consolidation is no mere instrument of
procedural convenience . . . but a measure vitally affecting
substantive rights."

                   Creditors Committee Objects

Deutsche Bank Securities' Motion is an attempt to modify its
treatment under the Plan, the Official Committee of Unsecured
Creditors of Mirant Corporation contends.

The Mirant Corp. Committee asserts that estimating the MAEM Claim
will neither provide any degree of certainty regarding the value
of the MAI estate nor facilitate the timely administration of the
cases.  These goals, according to the Mirant Corp. Committee, are
achieved through substantive consolidation as proposed in the
Debtors' Plan.

Jason S. Brookner, Esq., at Andrews Kurth LLP, in Dallas, Texas,
argues that estimation of MAEM Claim is not mandatory under
Section 502(c) of the Bankruptcy Code.  Before a court orders an
estimation proceeding, an initial determination must be made that
liquidating the claim or claims would unduly delay the bankruptcy
case.  Deutsche Bank Securities failed to assert any undue delay
in liquidating the MAEM Claim, Mr. Booker points out.

There is no reason to believe that estimation of the intercompany
claims would move matters faster than resolving substantive
consolidation under the Debtors' Plan, Mr. Booker maintains.  A
fair estimation of the Debtors' enterprise value would still
require lengthy and protracted hearings, notwithstanding highly
complex issues surrounding the intercompany claim.

The Court has stated that it will not address issues of
substantive consolidation under the Debtors' Plan prior to
confirmation, Mr. Booker points out.  "Thus, not only is
[Deutsche Bank Securities'] motion premature, the issues raised
therein are more appropriately addressed in the form of an
objection to confirmation of the Debtors' Plan."

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 65; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


NATIONAL ENERGY: ET Debtors' Amended Liquidation Plan Takes Effect
------------------------------------------------------------------
Shelley Chapman, Esq., at Willkie Farr & Gallagher LLP, in New
York, advises the U.S. Bankruptcy Court for the District of
Maryland that the Amended Plan of Liquidation for NEGT Energy
Trading Holdings Corporation, NEGT Energy Trading - Gas
Corporation, NEGT ET Investments Corporation, NEGT Energy Trading
- Power, L.P., Energy Services Ventures, Inc., and Quantum
Ventures became effective on May 2, 2005.

The Hon. Paul Mannes confirmed the ET Debtors' First Amended Plan
of Liquidation on Apr. 19, 2005.

As reported in the Troubled Company Reporter on Apr. 21, 2005, The
Liquidating Debtors are empowered to execute, deliver, file or
record contracts, instruments, releases, and other agreements or
documents and take all actions and perform all acts, including
expending funds, reasonably necessary or appropriate to
consummate, effectuate, implement, and further evidence the terms
and conditions of the Liquidation Plan.

In the event the Liquidation Plan becomes effective:

    (a) The Liquidating Debtors will retain, and confirmation of
        the Liquidation Plan will vest in the Liquidating Debtors,
        all property of their estates except any property of their
        estates that is abandoned or transferred to any other
        entity, as permitted under the Bankruptcy Code on or
        before the Effective Date; and

    (b) title to all non-excepted property will vest in the
        Liquidating Debtors, absolutely, unconditionally,
        indefeasibly and forever, on the Effective Date, free and
        clear of all Claims, all Liens securing Claims and all
        Interests -- except to the extent that those -- Claims,
        Liens, Charges, Encumbrances and Interests have been
        reinstated, or as otherwise expressly provided for in the
        Confirmed Plan.

The Liquidating ET Debtors will not be liable or responsible for
any Claim against or any obligation of the Liquidating Debtors or
their estates except as expressly assumed under the Confirmed
Plan.

Pursuant to the Confirmed Plan, the distributions and rights will
be in complete satisfaction, discharge and release, effective as
of the Effective Date, of all Claims against and Interests in the
Liquidating Debtors -- except those Liens, if any, which are
preserved pursuant to the Confirmed Plan -- on any property of
the Liquidating Debtors or their estates.

Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- (n/k/a National Energy & Gas
Transmission, Inc.) develops, builds, owns and operates electric
generating and natural gas pipeline facilities and provides energy
trading, marketing and risk-management services.  The Company and
its debtor-affiliates filed for Chapter 11 protection on July 8,
2003 (Bankr. D. Md. Case No. 03-30459).  Matthew A. Feldman, Esq.,
Shelley C. Chapman, Esq., and Carollynn H.G. Callari, Esq., at
Willkie Farr & Gallagher, and Paul M. Nussbaum, Esq., and Martin
T. Fletcher, Esq., at Whiteford, Taylor & Preston, L.L.P.,
represent the Debtors in their restructuring efforts.  When the
Company filed for protection from its creditors, it listed
$7,613,000,000 in assets and $9,062,000,000 in debts.  NEGT
received bankruptcy court approval of its reorganization plan in
May 2004, and that plan took effect on Oct. 29, 2004.  (PG&E
National Bankruptcy News, Issue No. 44; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


NBTY INC: $115M Solgar Vitamin Purchase Spurs S&P's Negative Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on NBTY
Inc., including its 'BB' corporate credit rating, on CreditWatch
with negative implications.  The Bohemia, New York-based vitamin,
mineral, and supplement manufacturer had total debt outstanding of
$292 million as of March 31, 2005.

The CreditWatch listing follows the announcement by NBTY that it
has signed a contract to acquire substantially all the assets of
Solgar Vitamin and Herb for approximately $115 million.  Solgar,
an operating unit of Wyeth Consumer Healthcare, a division of
Wyeth (A/Negative/A-1), manufactures and distributes nutritional
supplements.  The transaction is expected to be debt financed and
is expected to close by August 2005, subject to regulatory
approval.  Standard & Poor's will review NBTY's near- and longer-
term growth objectives, operating outlook, and overall financial
policies to resolve the CreditWatch listing.


NEW WORLD: Has Until December 30 to Decide on Leases
----------------------------------------------------
The Honorable Mary D. France of the U.S. Bankruptcy Court for the
Middle District of Pennsylvania gave New World Pasta Company and
its debtor-affiliates until Dec. 30, 2005, to decide whether to
assume, assume and assign or reject unexpired non-residential
leases.

The Debtors need more time to determine if the assumption or
rejection of particular leases is called for by the reorganization
plan that they are developing.  An extension will also enable the
Debtors to make informed business judgments on the assumption or
rejection of all the leases.

Headquartered in Harrisburg, Pennsylvania, New World Pasta Company
-- http://www.nwpasta.com/-- is a pasta manufacturer in the
United States.  The Company, along with its debtor-affiliates,
filed for chapter 11 protection (Bankr. M.D. Penn. Case No. 04-
02817) on May 10, 2004.  Eric L. Brossman, Esq., and Robert Bein,
Esq., at Saul Ewing LLP, in Harrisburg, serve as the Debtors'
local counsel.  Bonnie Steingart, Esq., and Vivek Melwani, Esq.,
at Fried, Frank, Harris, Shriver & Jacobson LLP, represent the
Creditors' Committee.  In its latest Form 10-Q for the period
ended June 29, 2002, New World Pasta reported $445,579,000 in
total assets and $451,816,000 in total liabilities.


O-CEDAR HOLDINGS: Ch. 7 Trustee Taps Saul Ewing as Special Counsel
------------------------------------------------------------------
Jeoffrey L. Burtch, the chapter 7 Trustee overseeing the
liquidation of O-Cedar Holdings, Inc., and its debtor-affiliates'
estates, sought and obtained permission from the U.S. Bankruptcy
Court for the District of Delaware to employ Saul Ewing LLP as his
special litigation counsel.

Mr. Burtch explains that he hired Saul Ewing as his special
litigation counsel because of the Firm's experience with a broad
range of sophisticated legal services in complex, high profile
corporate bankruptcy cases.

Mr. Burtch believes that there are still additional causes of
action in the Debtors' bankruptcy cases that may result in
significant recoveries for the estates.  Saul Ewing will primarily
be involved in investigating and issuing an opinion on all of
those causes of action.

Saul Ewing will also provide all other special litigation services
agreed to from time to time between the Firm and Mr. Burtch.

Mark Minuti, Esq., a Partner at Saul Ewing is the lead attorney
for the chapter 7 Trustee.  Mr. Minuti charges $410 per hour for
his services.

Mr. Minuti reports Saul Ewing's professionals bill:

    Professional           Designation    Hourly Rate
    ------------           -----------    -----------
    Timothy E. Hoeffner    Partner           $490
    Jeremy W. Ryan         Associate         $285
    Mark Cawley            Associate         $240
    Melissa Hill           Associate         $175

To the best of the chapter 7 Trustee's knowledge, Saul Ewing is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.

Headquartered in Springfield, Ohio, O-Cedar Holdings, Inc.,
through its debtor-affiliate, manufactured brooms, mops, and scrub
brushes for household and industrial use.  The Company filed for
chapter 11 protection on August 25, 2003 (Bankr. Del. Case No.
03-12667).  John Henry Knight, Esq., at Richards, Layton & Finger,
P.A., and Adam C. Harris, Esq., at O'Melveny & Myers LLP represent
the Debtors.  When the Debtors filed for protection from their
creditors, they listed over $50 million in both assets and debts.
On May 26, 2004, the Debtors' cases were converted to chapter 7
and Jeoffrey L. Burtch was appointed trustee.  Robert W. Pedigo,
Esq., at Cooch and Taylor represents the chapter 7 Trustee.


ORGANIZED LIVING: Asset Disposition to Provide Advice on Property
-----------------------------------------------------------------
Organized Living Inc. sought and obtained permission from the U.S.
Bankruptcy Court for the Southern District of Ohio to employ Asset
Disposition Advisors, LLC, as its asset disposition advisors and
consultants.

Asset Disposition will:

   a) advise the Debtor regarding the dispositions of selected
      non-core business assets, including designated store
      location inventory, furniture, fixtures and equipment;

   b) identify and contract proposed purchasers of inventory and
      furniture, fixtures and equipment including inventory of
      stores selected for closure;

   c) review and inspect the Debtor's assets including its
      inventory, operating leases, fixed assets and other assets;
      and

   d) attend meetings with the Debtor, its lenders or any
      committee of creditors that may be appointed and other
      parties-in-interest.

Paul Traub and Barry Gold, principals at Asset Disposition,
disclose that their Firm will receive a $75,000 base fee.

Asset Disposition's professionals' hourly rates:

             Professionals            Billing Rate
             -------------            ------------
             Paul Traub               $635
             Barry Gold               $550
             Senior Consultants       $500 - $540
             Junior Consutants        $285
             Support Staff            $ 75 - $165

Upon a consummation of a sale transaction, Asset Disposition will
receive 5% of the difference between the initial bid and the
winning bid price of the asset sold.

To the best of the Debtor's knowledge, Asset Disposition is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.

Headquartered in Westerville, Ohio, Organized Living, Inc., --
http://www.organizedliving.com/-- is an innovative retailer of
storage and organization products for the home and office with
stores throughout the U.S.  The Company filed for chapter 11
protection on May 4, 2005 (Bankr. S.D. Ohio Case No. 05-57620).
Tim Robinson, Esq., at Squire Sanders & Dempsey represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, it estimated assets and debts of
$10 million to $50 million.


OWENS CORNING: Wants to Hire Sidley Austin as Bankr. Co-Counsel
---------------------------------------------------------------
Owens Corning and its debtor-affiliates seek the U.S. Bankruptcy
Court for the District of Delaware's authority to employ Sidley
Austin Brown & Wood, LLP, as their general reorganization and
bankruptcy co-counsel pursuant to Section 327(a) of the Bankruptcy
Code, nunc pro tunc to April 28, 2005.

According to Owens Corning's Senior Vice President, General
Counsel and Secretary, Stephen K. Krull, Sidley Austin has
extensive familiarity with the issues that the Debtors face in
asbestos-related cases.  Sidley Austin also has extensive
corporate and securities, tax, finance and regulatory practices.

Mr. Krull reminds the Court that the Debtors initially wanted to
employ Saul Ewing LLP and Skadden, Arps, Slate, Meagher & Flom,
LLP as their general bankruptcy co-counsel.

However, the United States Trustee objected to the Debtors'
request to employ Skadden Arps.  The U.S. Trustee believed that
Skadden Arps did not meet the requirements under Section 327(a).

So since the Petition Date, Saul Ewing acted as the Debtors' sole
general bankruptcy counsel.  Skadden Arps was retained as special
counsel.  Skadden's employment was limited to an enumerated list
of non-bankruptcy-related services, principally corporate and
tax-related matters.

Mr. Krull notes that in light of the substantial complexities of
the Debtors' cases and the interwoven nature of bankruptcy,
corporate, tax, securities and other substantive issues --
particularly in the context of plan formulation and confirmation,
the agreed restrictions on the scope of Skadden's services has
impaired the ability of the Company, Saul Ewing and Skadden to
function in an optimal manner.

The Debtors want to retain Sidley to complement the services that
have been, and will continue to be, provided by Saul Ewing.

The Debtors will monitor the efforts of Sidley and Saul Ewing to
avoid duplication of services by those firms.

Sidley will charge the Debtors for its legal services on an
hourly basis in accordance with its ordinary and customary rates.
Sidley will also seek reimbursement of its actual and necessary
costs and expenses.

Sidley's hourly rates for U.S.-based professionals are subject to
periodic adjustment.  The current hourly rates are:

      Professional                         Hourly Rate
      ------------                         -----------
      Partners & Senior Counsel            $425 - $800
      Associates                           $180 - $465
      Para-professionals                    $80 - $200

James F. Conlan, Esq., a partner at Sidley, attests that the firm
does not hold or represent any interest adverse to the Debtors'
estate, and is a "disinterested person" within meaning of Section
101(14) of the Bankruptcy Code.

Headquartered in Toledo, Ohio, Owens Corning --
http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts.  The Company filed for chapter
11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837).
Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom,
represents the Debtors in their restructuring efforts.  At Sept.
30, 2004, the Company's balance sheet shows $7.5 billion in assets
and a $4.2 billion stockholders' deficit.  The company reported
$132 million of net income in the nine-month period ending
Sept. 30, 2004.  (Owens Corning Bankruptcy News, Issue No. 109;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


PENINSULA HOLDING: Wants to Hire Charlie Johnson as Bankr. Counsel
------------------------------------------------------------------
Peninsula Holding Company LLC asks the U.S. Bankruptcy Court for
the Western District of Washington for permission to employ the
Law Office Of Charlie Johnson as its general bankruptcy counsel.

Charlie Johnson is expected to:

   a) assist and advise the Debtor of its duties and obligations
      as a debtor-in-possession in the continued operation and
      management of its business and property;

   b) prepare on behalf of the Debtor, all necessary motions,
      applications, answers, orders, reports and papers in
      connection with the administration of the Debtor's chapter
      11 case; and

   c) provide all other legal services to the Debtor that are
      appropriate and necessary in its bankruptcy proceeding.

Charles A. Johnson, Jr. Esq., a Principal at Charlie Johnson, is
the lead attorney for the Debtor.  Mr. Johnson discloses that his
Firm received a $8,959 retainer.  Mr. Johnson charges $300 per
hour for his services.

Mr. Johnson reports that other attorneys from his Firm performing
services to the Debtor will charge at $300 per hour.

To the best of the Debtors' knowledge, the Law Office of Charlie
Johnson is a "disinterested person" as that term is defined in
Section 101(14) of the Bankruptcy Code.

Headquartered in Seattle, Washington, Peninsula Holding Company
LLC, develops raw land projects in Shelton, Washington.  The
Company filed for chapter 11 protection on May 19, 2005 (Bankr.
W.D. Wash. Case No. 05-16571).  When the Debtor filed for
protection from its creditors, it listed total assets of
$42,900,000 and total debts of $31,432,554.


PROXIM CORP: Has Until November 30 to Comply with Nasdaq Rule
-------------------------------------------------------------
Proxim Corporation (Nasdaq: PROX) received a letter from The
Nasdaq Stock Market, Inc., on June 3, 2005, notifying the Company
that for the 30 consecutive trading days preceding the date of the
letter, the bid price of the Company's common stock had closed
below the $1.00 per share minimum required for continued inclusion
on the Nasdaq National Market pursuant to Nasdaq Marketplace Rule
4450(a)(5).  The letter further notified the Company that, in
accordance with Nasdaq Marketplace Rule 4450(e)(2), the Company
will be provided 180 calendar days, or until Nov. 30, 2005, to
regain compliance with the minimum bid price requirement.
Compliance will be achieved if the bid price per share of the
Company's common stock closes at $1.00 per share or greater for a
minimum of ten consecutive trading days prior to Nov. 30, 2005.

If compliance with Nasdaq's Marketplace Rules is not achieved by
November 30, 2005 and if the Company is not eligible for an
additional compliance period, Nasdaq will provide notice that the
Company's common stock will be delisted from the Nasdaq National
Market.  In the event of such notification, the Company would have
an opportunity to appeal Nasdaq's determination or to apply to
transfer its common stock to the Nasdaq SmallCap Market.

                Exploring Strategic Alternatives

On Jan. 27, 2005, the Company disclosed that it engaged Bear,
Stearns & Co. to explore strategic alternatives for the Company,
including capital raising and merger opportunities.  The Company
remains actively engaged with Bear, Stearns & Co. and is currently
in discussions with a potential third party purchaser.  There can
be no assurance that a transaction will occur and, if a
transaction occurred, there can be no assurance that any
consideration available to the holders of the Company's Class A
common stock would approach the current market trading value of
the Company's Common Stock given, among other factors, the
preferences held by senior equity and debt holders.

                       Bankruptcy Warning

The Company has an immediate need for additional financing.  If
the Company were not able to enter into an agreement with a third
party purchaser or able to obtain sufficient financing in the
second quarter of 2005, it would be required to seek protection
under applicable bankruptcy laws.

                          About Proxim

Proxim Corporation -- http://www.proxim.com/-- designs and sells
wireless networking equipment for Wi-Fi and broadband wireless
networks.  The company is providing its enterprise and service
provider customers with wireless solutions for the mobile
enterprise, security and surveillance, last mile access, voice and
data backhaul, public hot spots, and metropolitan area networks.

At Apr. 1, 2005, Proxim Corporation's balance sheet showed a
$46.4 million stockholders' deficit, compared to a $44.9 million
deficit at Dec. 31, 2004.


PRUDENTIAL SECURITIES: Fitch Lifts Ratings on $9.3M Certs. to BB-
-----------------------------------------------------------------
Fitch Ratings upgrades Prudential Securities Secured Financing
Corp.'s commercial mortgage pass-through certificates, series
1999-NRF1:

     -- $46.4 million class C to 'AA+' from 'AA';
     -- $46.4 million class D to 'A-' from 'BBB+';
     -- $13.9 million class E to 'BBB+' from 'BBB';
     -- $20.9 million class F to 'BBB-' from 'BB+';
     -- $25.5 million class G to 'BB+' from 'BB';
     -- $9.3 million class H to 'BB' from 'BB-';
     -- $9.3 million class J to 'BB-' from 'B+'.

In addition, Fitch affirms the following classes:

     -- $3.5 million class A-1 'AAA';
     -- $480.3 million class A-2 'AAA';
     -- Interest-only class A-EC 'AAA';
     -- $51.1 million class B 'AAA'.

Fitch does not rate the $15.8 million class K, the $6.5 million
class L, or the $9.5 million class M certificates.

The upgrades are due to the overall improved performance of the
pool and the increase in credit enhancement resulting from loan
payoffs and amortization.  As of the May 2005 distribution date,
the pool has paid down 20.5% to $738.5 million from $928.9 million
at issuance.

KeyBank Real Estate Capital, as master servicer, collected year-
end 2004 financials for 95.2% of the transaction.  Among those
properties that reported, the weighted average debt service
coverage ratio improved to 1.66 times (x) from 1.53x at issuance
for the same loans.

Four loans (0.5%) are currently in special servicing: three loans
in foreclosure (0.4%) and one loan that is 90+ days delinquent
(0.1%).  Losses are expected, but are only expected to impact the
non-rated class M at this time.


QUIGLEY COMPANY: Foresight Group Approved as Valuation Consultants
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Quigley Company Inc. permission to employ The Foresight Group
as its pharmaceutical products valuation consultants.

The Debtor filed a plan of reorganization, an accompanying
disclosure statement and certain other plan-related documents on
March 4, 2005.  Bankruptcy Court records show no date has been set
for a hearing on the adequacy of that disclosure statement.

The Plan contemplates that Pfizer, Inc., Quigley's parent company,
and certain of Pfizer's affiliates will contribute certain assets
to reorganized Quigley and a 524(g) trust to resolve asbestos-
related claims will be established pursuant to the Plan.

Included in those assets will be a grant to reorganized Quigley on
the Plan's effective date of an exclusive, irrevocable, royalty
free, perpetual license in the United States to make, use, sell,
offer for sale and import certain pharmaceutical products
presently owned by Pfizer or certain of its affiliates.

The Debtor anticipates that projected revenues from the
pharmaceutical products will provide adequate funding for a
reorganized Quigley under a confirmed Plan.

The Debtor tells the Court that Foresight Group's retention is
necessary to facilitate the confirmation of the proposed Plan.

Additionally, the Official Committee of Unsecured Creditors and
the Legal Representative for future asbestos personal injury
claimants requested the Debtor to hire a valuation consultant to
make an independent valuation of the pharmaceutical products so
they can determine the contributions of Pfizer and certain of its
affiliates under the proposed Plan.  The Committee and Legal
Representative have consented to Quigley's employment of the
Foresight Group.

Foresight Group will:

   a) valuate the pharmaceutical products and analyze those
      pharmaceutical products projected revenues for the Debtors;
      and

   b) make an in-depth market and risk assessment and financial
      review of the cash flow potential of the pharmaceutical
      products.

Pieter A. van Hoeven, a Principal at Foresight Group, discloses
that professionals of the Firm performing services to Quigley will
charge $450 per hour.

Mr. van Hoeven reports that the Firm will be paid a Monthly Fee of
$13,500 and due diligence costs will be approximately $90,000 over
a six to seven week period.

To the best of the Debtors' knowledge, The Foresight Group is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.

Headquartered in Manhattan, Quigley Company is a subsidiary of
Pfizer, Inc., which used to produce and market a broad range of
refractories and related products to customers in the iron, steel,
glass and other industries.  The Company filed for chapter 11
protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to
resolve legacy asbestos-related liability. When the Debtor filed
for protection from its creditors, it listed $155,187,000 in total
assets and $141,933,000 in total debts.  Michael L. Cook, Esq., at
Schulte Roth & Zabel LLP, represents the Company in its
restructuring efforts.  Albert Togut, Esq., at Togut Segal & Segal
serves as the Futures Representative.


QWEST CORP: Fitch May Rate Proposed Senior Notes Offering at BB
---------------------------------------------------------------
Fitch Ratings expects to assign a 'BB' rating to a proposed
offering of senior unsecured notes by Qwest Corporation and a 'B+'
rating to the proposed offering by Qwest Communications
International, Inc., of senior notes guaranteed by Qwest Services
Corporation.

Fitch's action follows the announcement by QCII and QC to issue up
to $1.25 billion of debt through a private placement.  Fitch
expects that the proceeds from the issuance will be used in large
part to fund the $900 million tender offer for QSC senior
subordinated secured notes due 2007 and QC notes maturing during
2005 that was launched concurrently with the $1.25 billion debt
offering.  The Rating Outlook on the debt of QCII and its
subsidiaries is Stable.

Overall, Fitch's ratings for QCII and its subsidiaries incorporate
the scope, scale, and relatively stable cash flow generated by
QC's local exchange business, the company's stable liquidity
position, and the expectation of positive free cash flow
generation.  Fitch's ratings also recognize that QC's local
exchange business faces the ongoing challenges from competition
and product substitution that have negatively affected the
company's access line portfolio and operating margins.

Additionally, the high business risk and cash requirement of
QCII's out of region long-haul business is reflected in Fitch's
ratings.  Lastly, Fitch believes that the company's operating
profile, relative to its RBOC peer group, is limited with the lack
of significant growth opportunities.

Following the conclusion of Qwest's pursuit of MCI, Fitch believes
that acquisition risk will continue to be high for QCII and
presents the largest threat to the company's credit profile.

Total debt at the end of the first quarter of 2005 was
approximately $17.3 billion, which is basically flat with year-end
2004 debt levels.  Consolidated leverage as of the end of the
first quarter was 4.7 times (x).

Fitch does not anticipate any meaningful improvement with Qwest's
credit protection metrics during 2005.  This expectation reflects
Fitch's view that Qwest's revenues will remain pressured during
2005 as incremental revenue gains from Qwest's growth products,
including L/D, DSL, VoIP, video, and wireless will not offset
revenue declines within Qwest's local business and out of region
L/D business.

QCII's liquidity profile continues to stabilize and is supported
by the $2.4 billion of cash and liquid short-term investments on
hand as of the end of the first quarter of 2005, expected free
cash flow generation, availability from committed bank facilities,
and continued capital market access.

Fitch anticipates that QCII's ability to grow free cash flow
during 2005 will be primarily linked to the continuation of cost
reductions, facility cost improvements, and productivity
improvements, particularly within QCII's out of region long haul
business, the degree to which Qwest is successful in stabilizing
access line declines and revenue erosion, and the expected roll-
off of unconditional purchase obligations.

QCII's debt maturities during 2005 total approximately $579
million, including $400 million at QC and $179 million at Qwest
Capital Funding, are expected to be addressed by the proposed debt
issuance.

Fitch's Stable Rating Outlook reflects Fitch's expectation for
continued generation of free cash flow, stabilizing access line
and revenue erosion within its local exchange business, reducing
cash requirements associated with the company's long-haul
business, and the company's stable liquidity profile and
manageable near-term maturity schedule.


QWEST CORP: Moody's Rates Proposed Senior Unsecured Notes at Ba3
----------------------------------------------------------------
Moody's Investors Services has assigned a Ba3 rating to Qwest
Corporation's proposed senior unsecured note issuance and a B3
rating to Qwest Communications International Inc.'s proposed
senior unsecured notes issuance.  Moody's anticipates that the
company will raise approximately $1.25 billion between the two
issuing companies.  Moody's does not anticipate that consolidated
net debt will increase as a result of this transaction.  The
company announced today its intentions to tender for maturing debt
at QC and callable high-coupon debt at Qwest Services Corporation.

Moody's believes that Qwest will further reduce debt by targeting
Qwest Capital Funding, Inc.'s $179 million of notes maturing on
July 15, 2005 and a portion of QC's $1.25 billion Term Loan due in
2007, which can be prepaid after June 9, 2005.  This transaction
strengthens Qwest's already strong liquidity by improving its
consolidated near-term maturity profile.  Moody's affirms Qwest's
senior implied rating at B2.  The outlook for all ratings is
stable.

Moody's assigns the these ratings as part of its rating action:

   -- proposed Senior Unsecured Notes at QCII -- B3
   -- proposed Senior Unsecured Notes at QC -- Ba3

Moody's also affirms these ratings:

   -- QCII

      * Senior Implied rating - B2

      * Speculative Grade Liquidity Rating - SGL-1

      * $1.775 billion senior unsecured notes - (guaranteed by
        Qwest Services Corporation, secured by second lien on QC
        stock, and contractually senior to other QC 2nd priority
        liens) - B3

      * 7.50% senior unsecured notes due 11/1/2008 (secured by
        second priority lien on QC stock) -- Caa1

      * 9.47% and 8.29% senior unsecured notes due 10/15/2007 and
        2/1/2008 - Caa2

   -- QCF

      * senior unsecured long-term ratings -- Caa2

   -- QSC

      * At Senior secured revolving credit facility -- B2

      * Senior subordinated notes (secured by junior lien on QC
        stock) - Caa1

   -- QC

      * Qwest Corp senior unsecured long-term ratings -- Ba3

Moody's affirms QCII's B2 senior implied rating based on:

   1) sizable pre-dividend free cash flow generated by QC,
      countered by significant cash needs at the other
      subsidiaries, particularly the long-distance operations at
      Qwest Communications Corporation;

   2) QC's access line loss; and

   3) the reliance on dividends from QC to support the debt at
      QSC, QCF, QCII and QCC.

Moody's expects the company to generate approximately $300 million
in free cash flow in 2005, but total debt will remain high at
$17.1 billion.  Qwest B2 senior implied rating reflects continued
access line erosion, declining barriers to entry, a highly
leveraged balance sheet that may impair the company's ability to
pursue new growth initiatives and to weather unexpected economic
or operational shocks.

While Qwest did not win the bid for MCI, Moody's believes the
company will continue to evaluate other investment alternatives.
Moody's is concerned about the company's apparent willingness to
pay a premium for assets.  Given Qwest's relatively high debt
level, rating pressure is likely to increase if the company
significantly depletes its cash resources or incurs meaningful
incremental debt in an M&A transaction.

Moody's believes ratings stability is a function of Qwest's still
strong position in its incumbent markets; good asset coverage;
and, an expectation for increases in free cash generation
resulting from continued improvement in long distance costs
structure.  Moody's notes, however, that cable competition is
expanding rapidly, and that Qwest can only offer a bundle that
includes video and wireless through reseller arrangements.

The stable outlook also reflects Moody's belief that the
settlement with the SEC for $250 million facilitates the company's
ability to effectively access the capital markets. In addition,
the $250 million settlement ($125 million of which has been paid
to date) did not severely impact the company's liquidity nor
require it to incur additional indebtedness.

Though a DoJ investigation is still ongoing and shareholder
lawsuits are still pending, their ultimate financial impact is
difficult to quantify, but could be material.  The company
currently has $625 million reserved for potential settlements,
which will be reduced to $500 million following the remaining $125
million payment to the SEC.  At the current B2 rating level,
Moody's does not believe that actual settlements near this amount
will impair the company's credit metrics to a point that would
generate additional rating pressure.

Moody's expects that Qwest will continue to take steps to simplify
its capital structure by replacing existing debt at QSC and QCF
with debt raised at QCII.  This proposed transaction is in line
with our expectations.  The ratings also assume that Qwest will
maintain stable leverage at QC.  Moody's ratings also assume that
the debt issued at QC will have essentially the same terms and
conditions as the existing senior unsecured debt at QC, though a
longer maturity.  Moody's, therefore rates it at the same Ba3
rating level as this similarly structured debt.  The new debt at
QCII will share in the same subsidiary guarantees as the existing
$1.775 billion senior unsecured issue, and is rated at the same B3
level.

Moody's also affirms the relative notching of the debt at Qwest's
operating and financial subsidiaries.  This refinancing slightly
alters the distribution of debt between Qwest and its operating
subsidiaries.  For example, the coverage of the guaranteed senior
unsecured debt at QCII falls from 11 times to 9 times the
enterprise value (based on QCII's 6/6/05 closing stock price).  At
a B3 rating level, coverage is still sufficiently high to absorb
the modest deterioration in relative coverage.

Qwest's ratings are unlikely to rise until it stabilizes revenues
in its core strategic businesses.  Positive rating pressure could
develop, however, to the extent that the termination of the
mandatory purchase obligations in the intermediate term drives
improved earnings and cash flow at Qwest's long haul operations.
Furthermore, access line stability and increased DSL penetration
could support an improved rating outlook and/or positive rating
action.

Qwest's ratings could fall if its QC subsidiary suffers
accelerated access line erosion and subsequent cash flow
deterioration, particularly from cable VoIP competition.
Increased debt, operating losses or deteriorating liquidity at its
operating subsidiaries could also negatively affect Qwest's senior
implied rating, as could incurrence of debt to fund unexpected
investments.

Qwest is a regional Bell operating company and a nationwide
interexchange carrier headquartered in Denver, Colorado.


QWEST COMMS: S&P Puts Low-B Ratings on Proposed $1.25 Bil. Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to
Denver, Colorado-based telephone company Qwest Communications
International Inc.'s proposed offering of senior unsecured notes
due 2014 (a tack-on to the existing 7.5% notes due 2014), and its
'BB-' rating to incumbent local exchange carrier operating
subsidiary Qwest Corp.'s proposed offering of senior unsecured
notes due 2013 and 2015.  All are 144A with registration rights.

Qwest has not indicated the size of these respective note
issuances, and has only specified that the combined offering is
expected to be $1.25 billion.  Proceeds from the three debt issues
will be used for general corporate purposes, including funding or
refinancing its investments in telecommunications assets.

"The tack-on debt issue at Qwest is two notches lower than the
BB-/Developing/B-2 corporate credit rating, to reflect its junior
position relative to a substantial amount of other obligations,
including approximately $7 billion of debt at Qwest Corp., pro
forma for the new debt issuances and debt tenders," said Standard
& Poor's credit analyst Catherine Cosentino.

Standard & Poor's expects the new note issuances, coupled with an
announced $900 million of debt tender offers, will not result in a
meaningful increase in the company's overall level of consolidated
debt.  At the same time, Standard & poor's affirmed its ratings on
Qwest and its related entities, including our 'BB-' corporate
credit rating.  The outlook is developing.

The ratings reflect the relatively good overall business risk
profile of Qwest's increasingly challenged, but still well
positioned, local exchange business.  However, this is tempered by
the company's lack of a national wireless presence in contrast to
the other regional Bell operating companies, and by a fairly
leveraged financial profile -- largely a legacy of cash drain from
the classic Qwest long-distance business.


RESOLUTION PERFORMANCE: Completes Merger with Borden and RSP
------------------------------------------------------------
Borden Chemical, Inc., Resolution Performance Products LLC and
Resolution Specialty Materials LLC, completed their previously
announced combination to form Hexion Specialty Chemicals, Inc.,
the world's largest producer of thermosetting resins.  Hexion also
includes Bakelite AG, which Borden Chemical acquired in late
April.

"We are pleased to complete the formation of Hexion Specialty
Chemicals and are excited about the benefits our combined
enterprise will bring to our customers," said Craig O. Morrison,
president and chief executive officer.  Hexion Specialty Chemicals
will be headquartered in Columbus, Ohio.

                         About Hexion

Hexion Specialty Chemicals Inc. -- http://www.hexionchem.com/--  
is owned by affiliates of the private investment firm Apollo
Management, L.P.   Hexion Specialty Chemicals had pro forma 2004
annual net sales of $4.1 billion.  The company has approximately
7,000 employees and will rank third among North American-based
specialty chemical firms.  It has 86 manufacturing and
distribution sites in 18 countries in the Americas, Europe and the
Asia-Pacific region.  It has a broad range of products,
technologies and technical services for the industrial
marketplace.

                   About Borden Chemical Inc.

Borden Chemical Inc. has 48 manufacturing facilities in 9
countries, 2,400 associates and 2004 sales of $1.7 billion. Based
in Columbus, Ohio. Apollo Management acquired Borden Chemical in
August 2004.

              Resolution Specialty Materials LLC

Resolution Specialty Materials LLC, was formed from businesses
acquired by Apollo Management from Eastman Chemical Company in
August 2004.  Based in Houston, the Company has 2,100 employees
and facilities in the U.S., Europe and China.  The Company had
annual sales of $768 million in 2004.

                           Bakelite AG

Bakelite AG, based in Iserlohn-Letmathe, Germany, has 13
manufacturing facilities in Europe and Asia, 1,700 employees and
2004 sales of $699 million. The company was acquired by Borden
Chemical Inc., in April 2005.

                       About Apollo Management

Apollo Management, L.P., founded in 1990, is among the most active
and successful private investment firms in the U.S. in terms of
both number of investment transactions completed and aggregate
dollars invested.  Since its inception, Apollo has managed the
investment of an aggregate of approximately $13 billion in equity
capital in a wide variety of industries, both domestically and
internationally.

          About Resolution Performance Products LLC

Resolution Performance Products LLC, based in Houston, operates in
the United States, Europe and Asia.  The Company has 950 employees
and 2004 sales of $996 million.  Apollo acquired RPP from Shell
Oil Company in November 2000.

                         *     *     *

As reported in the Troubled Company Reporter on April 28, 2005,
Moody's Investors Service affirmed the B2 senior implied ratings
of Borden Chemical Inc. and Resolution Performance Products, LLC.
Moody's also changed the outlook on the ratings of both companies
to developing from negative following the announcement that Apollo
Management, LP will merge three chemical businesses under its
control to form a new company, Hexion Specialty Chemicals, Inc.


RESOLUTION PERFORMANCE: Merger Close Cues S&P to Withdraw Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating and other ratings for Hexion Specialty Chemicals
Inc. (formerly Borden Chemical Inc.) following the close of the
previously announced merger of Borden, Resolution Specialty
Materials LLC, and Resolution Performance Products LLC.

At the same time, Standard & Poor's withdrew its 'B+' ratings on
RSM after repayment of the company's rated debt obligations.
Standard & Poor's also raised the ratings on RPP and removed them
from CreditWatch with positive implications to reflect the
completion of the merger transaction (the 'B+' corporate credit
rating for RPP has subsequently been withdrawn).  The outlook is
negative.  Columbus, Ohio-based Hexion has more than $2.3 billion
of total debt outstanding.

"The ratings reflect a very aggressive financial profile resulting
from high debt leverage at the outset of the merger, somewhat
offset by a satisfactory business profile as a leading global
manufacturer and marketer of thermoset resins," said Standard &
Poor's credit analyst George Williams.

The combination represents a meaningful strategic initiative as it
creates one of the largest specialty chemical companies in North
America with a more diversified product portfolio, technology
base, end market sales, and geographic sales base.  During the
next few years, management is expected to balance capital
spending, integration efforts, and modest expansion efforts so
that some debt reduction can be achieved, thus maintaining key
financial ratios at appropriate levels for the ratings.

With pro forma revenues of $4.1 billion, Hexion is a leading
manufacturer of thermoset resins.

Key products include:

    (a) Formaldehyde and formaldehyde-based resins for the forest
        products, electronics, foundry and oil field services
        industries;

    (b) Base liquid epoxy resins (LER), solid epoxy resins, epoxy
        solutions, and other specialty products for use in
        coatings, adhesives, electronics, and construction
        materials; and

    (c) Alkyd, polyester and acrylic resins for use in paints and
        coatings.

Hexion's credit quality reflects its well-established business
positions within key segments of the $34 billion thermoset resins
industry; the company will hold the No. 1 or No. 2 market position
in product lines that make up 75% of sales.  For example, as a
stand-alone company Borden is the leading global manufacturer of
formaldehyde (consuming much of its production internally),
holding more than 15% of the worldwide formaldehyde-based resin
market, with a larger share in North America.  It is also the
largest producer of specialty phenolic resins.  The combination
adds RPP's well-established position as a producer of epoxy resins
(competitors include The Dow Chemical Co. and Huntsman Advanced
Materials LLC), and the company's leading global market shares for
versatic acids and derivatives and for Bisphenol A, a key epoxy
raw material, which is sold to the fast-growing polycarbonate
market.


REXAIR HOLDINGS: Moody's Rates $125MM Sr. Secured Term Loan at B1
-----------------------------------------------------------------
Moody's Investors Service assigned a first-time B1 rating to
Rexair Holdings, Inc.'s proposed senior secured credit
facility, which is comprised of a $124.0 million term loan and a
$20.0 million revolver.  At the same time, Moody's assigned a B1
senior implied rating.  The ratings outlook is stable.  The
ratings reflect the company's strong and consistent operating
margins, global diversification of its sales and reasonable
leverage offset by high product concentration, limitations of its
distribution system, the issuer's modest size, limited growth
opportunities and the intense competition in the mature floor care
industry.

Jacuzzi Brands is reducing its holding of Rexair through a sale to
a private equity sponsor, Rh"ne Capital LLC. Upon completion of
the transaction, Rh"ne and certain Rexair management will own 70%
of Rexair with Jacuzzi Brands retaining a 30% interest.  The $170
million purchase price plus $6 million in transaction expenses is
being financed with the proceeds from this offering and invested
equity.  The ratings are predicated on the understanding that
Rexair will not be responsible for the existing debt of Jacuzzi
Brands, for which Rexair is currently a co-borrower.

Rexair assembles and distributes a single product: a premium
priced vacuum cleaner, known as Rainbow, which sells for between
$1,800 and $2,000.  The Rainbow is sold directly to customers
through a direct sales channel of independent dealers who conduct
in-home product demonstrations. Customer leads are generated by
referrals from existing customers.

The ratings are supported by the consistently high operating
margins (around 25%), the global diversification of the company's
sales (roughly half of the company's sales are international) and
the modest projected leverage at closing for the B1 rating
category.  The ratings are also somewhat supported by the low
inventory risks inherent in Rexair's international business model
where the machines are built only against firm orders.

The ratings are constrained by the single product nature of the
business and a limited direct sales distribution channel.
Following the transaction, Moody's expects pro forma leverage
(adjusted debt / EBITDAR) to be around 4.1x, interest coverage
(EBITDA / interest) of 4.0x, and FCF/adjusted debt of 4.8%.  Debt
is adjusted primarily to capitalize modest operating leases.  Free
cash flow (FCF) is defined as cash from operations less capital
expenditures.

The stable rating outlook reflects the expectation that the
company will be able to maintain adequate margins and
profitability despite the inherent limitations of its product
offering and distribution model in today's very competitive floor
care marketplace.  The stable outlook also incorporates Moody's
belief that the company will steadily reduce its leverage.

The ratings could be upgraded if Rexair's operating margin is
maintained at levels above 25%, interest coverage approaches 5.0x,
and its adjusted debt/EBITDAR ratio drops below 3.0x for a
sustained period, and if the company's governance transition
proves to be successful.

Negative rating action could result from a deterioration in
Rexair's operating margins to below 20%, a decrease in interest
coverage below 3.0x, or an increase in its leverage to above 5.0x.
A significantly higher churn rate or a disruption in its
distribution model that results in reduced unit sales could also
cause negative ratings pressure.

The Senior Secured Credit facility, maturing in 2010, will be
guaranteed by the company's domestic subsidiaries and secured by a
first lien on the assets of Rexair and its domestic subsidiaries.
The term loan portion of the senior secured credit facility will
benefit from an excess cash flow sweep.  It is expected that the
revolver will be un-drawn at closing.  The senior secured credit
facility will contain certain financial covenants including
interest coverage, total leverage, and fixed charge coverage, for
which Moody's projects expected compliance with adequate cushion.
The ratings assigned are subject to the receipt of final
documentation with no material changes to the terms as originally
reviewed by Moody's.

The ratings assigned were:

   * $124.0 million guaranteed senior secured 5-year term loan, of
     B1,

   * $20.0 million guaranteed senior secured 5-year revolving
     credit facility of B1,

   * Senior implied rating, of B1,

Rexair Holdings, Inc., based in Troy, Michigan, is the
manufacturer and distributor of the Rainbow Cleaning System, a
premium vacuum cleaner.  The company, founded in 1935, markets its
products throughout the world and has just 50% of its sales in the
United States.  For the fiscal year ended September 30, 2004, the
company reported net sales of approximately $105 million.


SANTA ROSA: Moody's Affirms B1 Rating on $95MM Revenue Bonds
------------------------------------------------------------
Moody's Investors Service has affirmed the B1 rating on the Santa
Rosa Bay Bridge Authority's $95 million Series 1996 Revenue Bonds.
The outlook has been revised to stable from negative.  Proceeds of
the bonds were used to finance the construction of the Garcon
Point Bridge connecting Garcon Point to the Gulf Breeze Peninsula.
The bonds are secured by gross toll revenues of the 3.5 mile
bridge.

The B1 rating is based on Moody's expectation that due to traffic
levels that have been and are expected to remain well below
initial forecasts the Authority will continue to draw on debt
service reserve funds for the foreseeable future in order to meet
its debt service requirements.  Barring a restructuring of the
debt, an eventual payment default is possible, although it does
not appear to be imminent.

Credit Strengths:

   * Gross revenue pledge, with O&M paid by Florida Department of
     Transportation (FDOT);

   * Balance in debt service reserve fund expected to be adequate
     to cover toll revenue shortfalls for several more years; and

   * Authority may break even in the current fiscal year with
     traffic up despite a recent toll increase.

Credit Challenges:

   * Traffic and revenue remain far below initial projections;

   * Authority continues to rely on debt service reserve fund to
     pay a portion of annual debt service;

   * Principal amortization commences this year resulting in
     escalating annual debt service;

   * With no state commitment to support any of the debt,
     restructuring will be difficult; and

   * Prospects for increased competition in longer term.

       Debt Service Reserve Fund Balance Remains Adequate

Following three years of draws, the debt service reserve fund
(DSRF) presently has a balance of $6.2 million.  The gross pledge
means that annual draws on the debt service reserve have been
relatively small and they are expected to remain so despite the
commencement of principal amortization in the current fiscal year.
The gross pledge is made meaningful by FDOT's commitment to pay
the bridge's operating and maintenance costs.  Based upon the
traffic consultant's more conservative current forecasts, FDOT
estimates that the Authority should be able to avoid default until
at least 2012.

              Authority Could Break Even This Year

If recent trends continue, however, Moody's believes the projected
2012 payment default date may be deferred considerably.  Traffic
and revenues increased by more than 15% in FY 2004.  Fiscal
year-to-date 2005, revenues are up another 25%, driven by a 20%
toll increase last July 1.  The toll increase notwithstanding,
traffic - which had been projected to drop by nearly 9% - is up
nearly 5% in FY 2005.

If traffic growth continues at the same pace for the rest of the
year, Moody's projects that the Authority may break even for the
year after taking into account forecasted earnings on the DSRF and
other miscellaneous revenues.  Moody's notes that the January 1
draw on the DSRF of $80,000 was minimal relative to the $2.45
million interest payment.  Going forward, however, revenues will
have to grow by more than 6% annually for the next twenty years to
keep pace with scheduled increases in debt service.

The year-to-date traffic figures exclude the month of September,
for much of which time tolls were lifted due to Hurricane Ivan,
which struck the surrounding area very hard.  The FDOT has
reimbursed the Authority for $267,000 in lost revenues.  FDOT also
funded all repair costs, totaling $216,000.

       Potential For Increased Competition In Longer Term

One reason for this apparent inelasticity of demand may be that
traffic has diverted from I-10.  As a result of heavy damage to
the I-10 Escambia Bay crossing between Pensacola and Avalon Beach
caused by last year's hurricanes, one westbound lane has been
closed and traffic is heavily congested.  It is expected to take
three years before repairs can be completed during which time
Moody's expects that the Authority will continue to benefit from
traffic diversion.

A substantial amount of traffic has reportedly been generated by
the reconstruction activity occurring on the Gulf Breeze Peninsula
itself.  Additionally, new development continues to occur on the
Peninsula, though still not on the scale initially projected.  The
bridge is also expected to benefit from construction-related
congestion on route 87 to the east, which is being widened from 2
to 4 lanes. Once the widening is complete in 2009, however, it
will likely lead to increased competition and traffic diversion
away from the bridge.

                             Outlook

The stable outlook reflects the possibility that the Authority may
break even in the current fiscal year due to growth in both
traffic and revenue.  Furthermore, Moody's expects monies
remaining in the debt service reserve fund will be sufficient to
supplement toll revenues for several more years despite escalating
annual debt service requirements.  Even if toll revenues do not
keep pace, this provides additional time for a potential workout
to be arranged.  However, Moody's notes that beyond its commitment
to pay the bridge's O&M expenses, FDOT is unlikely to provide any
direct support for debt service.

                What Could Change the Rating - UP

The rating could rise if the Authority can establish a trend of
break-even operations.

               What Could Change the Rating - DOWN

The rating could face downward pressure if traffic and revenue
fall below current projections, leading to a faster than expected
drawdown of the debt service reserve fund, or if no viable work
out plan is developed as reserves run out.

Key Indicators:

   * Type of System: toll bridge

   * Size of System: 3.5 miles, two lanes

   * Transactions, FY 2004: 1.5 million

   * Average Annual Traffic Growth, FY 00 - FY 04: 5.7%

   * Average Annual Revenue Growth, FY 00 - FY 04: 11.5%

   * Debt Service Coverage, FY 04: 0.87x

   * Debt Service Reserve Fund Balance: $6.2 million

   * Debt Outstanding: $95 million


SEARS HOLDINGS: Posts $9 Million Net Loss in First Quarter 2005
---------------------------------------------------------------
Sears Holdings Corporation (Nasdaq: SHLD), issued its financial
statements for the quarter ended April 30, 2005.  Sears Holdings
was created in connection with the merger of Kmart Holding
Corporation and Sears, Roebuck and Co., which was completed on
March 24, 2005.  Sears Holdings is the nation's third largest
broadline retailer with approximately 2,300 full-line and 1,200
specialty retail stores in the United States operating through
Kmart and Sears and 340 full-line and specialty stores in Canada
operating through Sears Canada Inc., a 54%-owned subsidiary.

                       Financial Position

The Company reported a $9 million net loss for the 13-week period
ended Apr. 30, 2005, compared to a $91 million net income for the
13-week period ended Apr. 28, 2004.

As of April 30, 2005, Holdings had approximately $30 billion of
assets and $11 billion of equity, as follows:


     (in billions)                    April 30,       April 28,      Jan.
26,
                                        2005           2004 (1)      2005
(1)
     Total assets                      $30.6            $6.3          $8.7
     Total liabilities                  19.4             4.0           4.2
     Shareholders' equity              $11.2            $2.3          $4.5

(1) For accounting purposes, the business combination was treated as a
    purchase of Sears by Kmart.  As such, the historical financial
    statements of Kmart become the historical financial statements for
    Holdings.

Holdings ended the first quarter with $1.6 billion of cash and
cash equivalents.  Prior to the consummation of the merger, Kmart
and Sears had approximately $7.4 billion of cash and cash
equivalents in aggregate.  The decrease in cash reflects the
$5.4 billion paid to former Sears shareholders and option holders
in connection with the merger and the repayment of $346 million of
commercial paper borrowings.  In addition to the $1.6 billion of
cash on hand, Holdings has access to a $4 billion credit facility
that is secured by domestic inventory and credit card accounts
receivable.

Holdings' inventory level at April 30, 2005 was approximately
$9.5 billion, an increase of $6.1 billion over the prior year as a
result of the merger.  The current year inventory balance includes
a purchase accounting step up adjustment of $48 million on Sears
inventory above its FIFO value.  As of the prior year period, the
combined inventory on a FIFO basis of Sears and Kmart was
approximately $9.7 billion.  The merchandise payable balance is
$3.7 billion at April 30, 2005 as compared to $3.9 billion for
Sears and Kmart combined as of April 28, 2004.

During the first quarter of 2005, Holdings spent $66 million on
capital expenditures as compared to $55 million and $88 million
spent by Kmart and Sears, respectively, during the same 13-week
period in the prior year.  The current year spending of $66
million excludes approximately $40 million of capital expenditures
made by Sears during the period January 30, 2005 through March 24,
2005 (pre-merger period).

                    Same Store Sales Tumble

Comparable store sales and total sales at Kmart decreased 3.7% and
2.3%, respectively, for the 13 weeks ended April 30, 2005 as
compared to the 13 weeks ended April 28, 2004.  The decline in
same-store and total sales is due to lower transaction volumes,
the impact of poor weather conditions on the Company's seasonal
product lines, and the impact of ongoing construction activity in
stores which are converting to the Sears Essentials format.  Total
sales benefited from an additional $153 million of sales as a
result of three additional days in the current quarter due to the
Company's change in fiscal year end from the last Wednesday in
January to the Saturday closest to January 31st.  However, total
sales were negatively impacted by a reduction in the total number
of operating Kmart stores, which more than offset the additional
three days of revenue.

Merchandise sales and services revenues at Sears Domestic
increased 0.5% for the 13-week period ended April 30, 2005 versus
the 13 week-period ended May 1, 2004.  The slight increase was due
to strong home services sales partially offset by a 3.1% decrease
in domestic comparable store sales.  Within domestic sales, cooler
than anticipated weather conditions caused declines in certain
seasonal businesses, including lawn and garden and seasonal
apparel categories.  These declines were partially offset by
modest gains within the footwear and automotive categories.  Lower
sales have also resulted from efforts initiated in 2005 to reduce
reliance on certain promotional events and strategies historically
executed to drive transactional volumes at the expense of lower
margin rates.

A $90 million after-tax charge was recorded as a cumulative effect
of change in accounting in the first quarter of 2005 resulting
from the Company's decision to change its method of accounting for
certain indirect overhead costs included in inventory.

                        Pro Forma Results

The statement of operations for the 13 weeks ended April 30, 2005
is not representative of the on-going results for Holdings as it
only includes Sears results of operations from March 25, 2005
forward.  Had the Sears results for the full quarter been
included, Holdings' revenues would have been approximately $5
billion higher.  Therefore, the Company believes that an
understanding of trends and on-going performance is not complete
without presenting results on a pro forma basis that include Sears
results for a full 13-week period.

The pro forma information is not indicative of the results of
operations that would have been achieved if the merger had taken
place at the beginning of 2004 or that may result in the future.
The pro forma information has not been adjusted to reflect any
operating efficiencies that may be realized as a result of the
merger.

A full-text of Sears Holdings' Form 10-Q is available at no charge
at the Securities and Exchange Commission or at the Company's Web
site at http://www.searsholdings.com/

                About Sears Holdings Corporation

Sears Holdings Corporation -- http://www.searshc.com/-- is the
nation's third largest broadline retailer, with approximately
$55 billion in annual revenues, and with approximately 3,800
full-line and specialty retail stores in the United States and
Canada.  Sears Holdings is the leading home appliance retailer as
well as a leader in tools, lawn and garden, home electronics and
automotive repair and maintenance.  Key proprietary brands include
Kenmore, Craftsman and DieHard, and a broad apparel offering,
including such well-known labels as Lands' End, Jaclyn Smith and
Joe Boxer, as well as the Apostrophe and Covington brands.  It
also has Martha Stewart Everyday products, which are offered
exclusively in the U.S. by Kmart and in Canada by Sears Canada.
(Kmart Bankruptcy News, Issue No. 94; Bankruptcy Creditors'
Service, Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on March 31, 2005,
Moody's Investors Service affirmed the Ba1 senior implied rating
of Sears Holding Corporation.  Moody's said the rating outlook is
stable.

Ratings assigned:

     Sears Holdings Corporation

        * Senior implied rating at Ba1;
        * Senior unsecured issuer rating at Ba1; and
        * $4 billion senior secured revolving credit facility
          at Baa3.

As reported in the Troubled Company Reporter on March 30, 2005,
Fitch Ratings assigned a 'BB' rating to Sears Holdings senior
unsecured debt, with a negative outlook.

At the same time, Standard & Poor's assigned its 'BB+' corporate
credit rating to Sears Holdings, with a negative outlook.


SILGAN HOLDINGS: S&P Rates Proposed $1B Sr. Sec. Facilities at BB
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' rating and
its recovery rating of '3' to Silgan Holdings Inc.'s proposed $1
billion senior secured credit facilities, based on preliminary
terms and conditions.

The proposed credit facilities consist of a $450 million senior
secured revolving credit facility due 2011, a $325 million term
loan A due 2011, and a $225 million term loan B due 2012.
Proceeds will be used to refinance existing bank debt. The rating
on the proposed senior secured credit facilities is the same as
the corporate credit rating; this and the '3' recovery rating
indicate the expectation of a meaningful (50% to 80%) recovery of
principal in the event of a payment default.

At the same time, Standard & Poor's affirmed its 'BB' corporate
credit rating and other ratings on the company. The outlook is
positive.  Stamford, Connecticut-based Silgan had about $993
million of debt outstanding at March 31, 2005.

"The ratings on Silgan are supported by its satisfactory business
position as a major North American producer of rigid consumer
goods packaging, steady earnings and free cash flow generation,
and sufficient liquidity, offset by aggressive debt leverage,"
said Standard & Poor's credit analyst Liley Mehta.  In addition,
supporting factors include the company's improving financial
profile and policies that enhance prospects for further debt
reduction.

With annual revenues of about $2.4 billion, Silgan is the largest
producer of metal food cans in North America and enjoys a dominant
volume market share estimated at 50%.  The company's business mix
is about 76% in metal food cans and closures, and 24% in plastic
containers and tubes primarily for personal care products, in
which the company enjoys a co-leadership position.  Although the
metal can industry is mature and competitive, end markets are
relatively stable.  However, they are subject to some seasonal
variations in food production and consumer buying habits.

Conversely, the plastic container segment is fragmented, and
competition is intense.  In general, Silgan's customer
concentration is moderate, and a significant portion of its metal-
and plastic-container output is produced under long-term supply
contracts that include meaningful protection against raw-material
price movements.  In light of significantly higher steel prices,
the company is expected to pass through these increases to
customers in 2005.


SYNAGRO TECH: Gets Tenders from Holders of $92.4 Million Notes
--------------------------------------------------------------
Synagro Technologies, Inc. (NASDAQ Small Cap:SYGR), reported the
results to date of its cash tender offer and consent solicitation
for all $150 million of its outstanding 9-1/2% Senior Subordinated
Notes due 2009.  As of 5:00 p.m., New York City time, on June 7,
2005, the Company received tenders from holders of $92.4 million
in aggregate principal amount of the notes, representing
approximately 61.6% of the outstanding notes.

Accordingly, the requisite consents to adopt the proposed
amendments to the indenture governing the notes have been
received.  Adoption of the proposed amendments required the
receipt of consents from holders of at least a majority of the
aggregate principal amount of the outstanding notes.  The proposed
amendments, however, will not become operative until the Company
accepts the notes for payment pursuant to the tender offer.

Holders still have until today, June 9, 2005, 5:00 p.m., New York
City time, to tender and receive the consent payment of $30 per
$1,000 principal amount of Notes.  Withdrawal rights with respect
to the tendered notes expired as of 5:00 p.m., New York City time
on June 7, 2005.  Accordingly, holders may not withdraw notes
previously or hereafter tendered, except as contemplated in the
Offer.

The Price Determination Date will be 2:00 p.m., New York City
time, at least ten business days prior to the Expiration Date.
The Company expects the Price Determination Date to be on or about
June 15, 2005.  Holders who validly tender notes, and such notes
are accepted for payment, will receive payment promptly following
the satisfaction or waiver of the conditions to the offer on the
initial payment date.  The Company expects the initial payment
date to be on or about June 20, 2005.

The tender offer is scheduled to expire at 5:00 p.m., New York
City time, on June 29, 2005, unless extended or earlier
terminated.  No consent payments will be made in respect of notes
tendered after 5:00 p.m., New York City time, on June 9, 2005.

The tender offer and consent solicitation continue to be subject
to the satisfaction or waiver of certain conditions, including the
satisfaction of the Supplemental Indenture Condition, the
Transactions Condition and the General Conditions, each as further
described in the Offer to Purchase.  There can be no assurance
that any of such conditions will be met.

The complete terms and conditions of the tender offer and consent
solicitation are described in the Offer to Purchase, copies of
which may be obtained by contacting the depositary and information
agent for the offer:

               D. F. King & Co., Inc.,
               212-269-5550 (collect)
               800-659-5550 (U.S. toll-free)

Banc of America Securities LLC and Lehman Brothers Inc. are the
dealer managers and solicitation agents for the tender offer and
consent solicitation.  Additional information concerning the
tender offer and consent solicitation may be obtained by
contacting:

               Banc of America Securities LLC
               High Yield Special Products
               704-388-9217 (collect)
               888-292-0070 (U.S. toll-free)

                      -- or --

               Lehman Brothers Inc.
               Liability Management Group
               212-528-7581 (collect)
               800-438-3242 (U.S. toll-free)

                       About the Company

Synagro offers a broad range of water and wastewater residuals
management services focusing on the beneficial reuse of organic,
nonhazardous residuals resulting from the wastewater treatment
process, including drying and pelletization, composting, product
marketing, incineration, alkaline stabilization, land application,
collection and transportation, regulatory compliance, dewatering,
and facility cleanout services.

                         *     *     *

Synagro's 9-1/2 % senior subordinated notes due Apr. 1, 2009,
carry Moody's Investors Service's Caa1 rating and Standard &
Poor's single-B rating.


TENASKA ALABAMA: Moody's Rates $360 Mil. Senior Sec. Bonds at B1
----------------------------------------------------------------
Moody's Investors Service has assigned a B1 rating to
approximately $360 million of senior secured bonds to be issued by
Tenaska Alabama Partners, L.P. (Alabama), an 845 MW natural gas
and oil-fired, combined cycle power project in Autauga County,
Alabama.  Proceeds from the bonds will be used to refinance
existing debt, fund a six-month debt service reserve, and pay
associated transaction costs. The rating outlook is stable.

The B1 rating for the bonds reflects the following areas of credit
concern:

   1) The key limiting factor for the rating is the reliance on
      The Williams Companies, Inc. (Williams: B1 senior unsecured,
      stable outlook) as guarantor of the tolling contract with
      Williams Power Company, Inc. (Williams Power), which
      provides essentially all of the project's cash flow.  Under
      current market conditions, Moody's believes that the cash
      that could be generated via merchant power sales or an
      alternative contract would likely not be sufficient to cover
      operating costs and debt service.

   2) Alabama is a single asset that relies on a single off-taker.
      Financial results are highly dependent on operational
      performance meeting requirements under the tolling
      agreement.

   3) Alabama operates in an overbuilt market and has been
      dispatched at a much lower rate than originally anticipated.

   4) The project is highly leveraged with a debt to capital ratio
      close to 100% on a GAAP balance sheet basis.

The B1 rating is supported by:

   1) There is no construction risk, as the project began
      commercial operations in May 2002.

   2) Strong operating performance, with peak period availability
      over 98% for the contract years ending April 2004 and 2005.

   3) An experienced operator and technology that is proven and
      relatively reliable.

   4) Stable cash flows that are generated by a tolling agreement
      with an initial term of 20 years and a 5-year extension
      option.  The agreement includes fixed payments sufficient to
      cover fixed costs and debt service, and variable payments to
      cover variable operating costs.  Fuel supply and pricing
      risk is borne by Williams Power.

   5) The stability of cash flow is enhanced by a long-term
      service agreement with General Electric International, an
      affiliate of the equipment provider.  As a result, there is
      only a small variation in projected debt service coverage
      ratios under a fairly wide range of operating scenarios.

   6) The project finance structure has standard creditor
      protections, including a full security package, controls on
      cash via a series of waterfall accounts that are controlled
      by a trustee, and a six month debt service reserve that will
      initially be funded with cash.

The rating outlook is stable.  The combination of Alabama's
projected 1.33 times average debt service coverage, the expected
stability of its projected cash flows, the experience of Tenaska
Operations, Inc. and the benefits of a long term service agreement
for major maintenance needs, are supportive of a rating higher
than B1.  However, the B1 rating for Alabama is constrained by the
B1 senior unsecured rating of Williams and our view that based
upon current market prices for natural gas and power, the project
would not likely to be able to generate sufficient cash to cover
operating costs and debt service without the Williams Power
contract.

At its current level, the rating is highly likely to be revised
upward in the event of an upgrade of Williams' senior unsecured
rating. The rating could also be revised upward if there were to
be a significant improvement in conditions in the southeast power
market.

At its current level, the rating is highly likely to be revised
downward in the event of a downgrade of Williams' senior unsecured
rating. The rating could also be revised downward if the project
were to experience serious shortfalls in operational performance
that would result in annual coverage of debt service below 1.10
times.

The Alabama bonds are secured by all of the project's assets, the
partnership interests, all contracts, guarantees and cash flow.
The project's liquidity is enhanced by a six month debt service
reserve that will initially be funded in cash. Under certain
circumstances, the project may substitute a letter of credit to be
provided by a bank rated at least A3. Distributions are permitted
only if the debt service coverage ratio (calculated on a rolling
four quarter basis looking both backward and forward) is above
1.15 times.

Alabama operates in a market that has substantial excess
generating capacity.  As a result, the project has been operated
at much lower capacity factors than originally anticipated
(approximately 11% versus an original expectation of over 65%).
However, the project continues to receive regular demand payments
under the tolling agreement.  The project must achieve minimum
availability targets (95% peak and 94% annual) to receive the full
amount of capacity payments under its tolling agreement.  The
project surpassed these targets in each year of operations since
it began commercial operation.

Operational risk is mitigated by the project's proven technology,
the relatively high reliability history for similar plants, and
Tenaska Operations, Inc.'s favorable experience as the operator of
other plants with the same technology.  In addition, General
Electric International provides major maintenance and repairs for
the gas turbines and steam turbine under a long-term service
agreement (LTSA).  Pricing provisions under the LTSA are well
aligned with those of the fuel conversion services agreement
(FCSA), so there is only a small amount of variability in the
project's cash flow under a wide range of dispatch scenarios.

The B1 rating is supported by the predictable cash flows provided
under the FCSA with Williams Power that has an initial 20 year
term and a 5 year renewal term.  The obligations of Williams Power
are supported by an irrevocable and unconditional payment
guarantee from The Williams Companies, Inc.  Pursuant to the FCSA,
Williams Power is obligated to purchase all of the project's
electrical output through the initial 20-year term as well as
during the 5-year extension option that is exercisable by either
Williams Power or Alabama.

The price of capacity during the 5-year extension term of the FCSA
will be determined by whether it is Williams Power or Alabama that
exercises the extension option. Williams Power is also responsible
for providing fuel to the project, such that the FCSA constitutes
a tolling agreement.  This structure eliminates fuel risk as a
significant credit consideration, subject to performance by
Williams Power under the tolling agreement.

Debt service coverage ratios are expected to average approximately
1.33 times over the life of the bonds and 1.30 times for the first
12 years. The debt service coverage ratios projected under the
base case scenario are expected to be very stable and exhibited
only a modest level of volatility under a range of dispatch and
other sensitivity scenarios.

The rating is subject to review of final documentation that is
consistent with current expectations.

Tenaska Alabama Power Partners, L.P., is an 846 MW gas and oil-
fired power project located in central Alabama.


TENASKA ALABAMA: S&P Rates Proposed $359.4M Sr. Sec. Bonds at B+
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'B+'
rating to Tenaska Alabama Partners L.P.'s proposed $359.4 million
senior secured bonds due 2021.

The outlook is stable. The final ratings will be issued on receipt
and satisfactory review of all final transaction documentation,
including legal opinions and bond offering circular.

TAP is a Delaware limited partnership that will use the proceeds
of the bonds to refinance the 845 MW Tenaska Lindsay Hill
generating station, a combined-cycle, natural gas- and oil-fired
power plant, located in Autauga County, Alabama.

"The project should be able to meet availability and capacity
requirements under its agreement with Williams Power Co. Inc.,
which in turn is expected to provide a predictable and stable
revenue stream," said Standard & Poor's credit analyst Ralf
Etzelmueller.

However, Standard & Poor's also said that the offtaker, Williams
Power, is an unrated subsidiary of The Williams Cos. Inc., which
is a below investment-grade company.

Furthermore, electricity prices paid under the agreement with
Williams are above current market prices in the Southeastern
Electric Reliability Council region.

Although the project's economics would support a higher rating if
Standard & Poor's raises its rating on Williams, in Standard &
Poor's view, TAP's current financial structure would not warrant
an investment-grade rating on a stand-alone basis but could
support a rating in the 'BB' category.

The power plant is located in Autauga County near Billingsley,
Alabama, northwest of Montgomery.


TWENTIETH CENTURY: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Twentieth Century Mortgage, Inc.
        3000 South Jamaica Court
        Aurora, Colorado 80014

Bankruptcy Case No.: 05-23961

Type of Business: The Debtor is a mortgage company.

Chapter 11 Petition Date: June 7, 2005

Court: District of Colorado (Denver)

Debtor's Counsel: Christian C. Onsager, Esq.
                  1873 South Bellaire Street, Suite 1401
                  Denver, Colorado 80222
                  Tel: (303) 512-1123

Estimated Assets: $500,000 to $1 Million

Estimated Debts:  $100,000 to $500,000

Debtor's 20 Largest Unsecured Creditors:

   Entity                                      Claim Amount
   ------                                      ------------
   Flagstar Bank, FSB                           $22,000,000
   c/o Brownstein, Hyatt & Farber, P.C.
   410 17th Street, 22nd Floor
   Denver, CO 80202

   United Merchant Agencies, Inc.                  $108,165
   600 South 7th Street
   St. Louis, KY 40201-1672

   North Academy Home Center LLC                    $82,840
   P.O. Box 5681
   Denver, CO 80217-5681

   RMC/Pavillion Towers LLC                         $23,000

   Qwest                                            $21,950

   Levy, Diamond, Bello & Assoc., LLC               $11,388

   Global Creditors Network                          $7,572

   Delmar Database                                   $7,425

   GE Capital                                        $6,794

   Regence Blueshieldo                               $5,850

   Countrywide Home Loans                            $5,423

   ARSI                                              $5,179

   Trout & Associates                                $3,380

   Qwest                                             $2,762

   Millennium Group Holdings Inc.                    $2,550

   Netbank                                           $2,232

   Colorado Springs Utilities                        $1,003

   The Gazette                                         $810

   NCO Financial Systems                               $700

   NACM Business Credit Services                       $685


UNITED PRODUCERS: Has Until August 27 to Decide on Leases
---------------------------------------------------------
United Producers, Inc., sought and obtained an extension from the
U.S. Bankruptcy Court for the Southern District of Ohio, Eastern
Division, of the time within which it must decide to assume,
assume and assign, or reject unexpired leases of nonresidential
real property to August 27, 2005.

The Debtor is a party to 20 unexpired leases of nonresidential
real property.  The Debtor uses these properties for office space,
livestock collection points and auction sites.

The Debtor asked for the extension to avoid making a premature
decision on these leases prior to plan formation.

Headquartered in Columbus, Ohio, United Producers, Inc. --
http://www.uproducers.com/-- offers marketing, financing, and
credit services to its member livestock producers in the U.S. corn
belt, southeast, and midwest areas.  The company and its debtor-
affiliate filed for chapter 11 protection on Apr. 1, 2005 (Bankr.
S.D. Ohio Case No. 05-55272).  Reginald W. Jackson, Esq. at Vorys,
Sater, Seymour and Pease, LLP represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it estimated $10 million to $50 million in assets
and debts.


URS CORP: Equity Offering Prompts S&P's Watch Positive
------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on URS
Corp., including the 'BB' corporate credit rating, on CreditWatch
with positive implications.  At April 1, 2005, the San Francisco,
California-based engineering services firm had approximately $899
million in total debt outstanding.

The CreditWatch placement follows the company's announcement that
it has proposed an equity offering of 3.69 million shares of
common stock.  At the same time, the company is making a tender
offer for its outstanding 11.5% notes, which it will purchase
using proceeds from the equity offering.  The equity issue and
planned reduction of debt demonstrate that the company is pursuing
a less aggressive financial policy than Standard & Poor's
previously anticipated.

Taking into account the tender offer, the company's pro forma
total lease-adjusted debt to EBITDA for the 12 months ended April
1, 2005, would improve, falling to about 3.1x from approximately
3.6x, while funds flow from operations to lease-adjusted debt
would strengthen to 24% from 21%.  Standard & Poor's current
expectations for the rating are that total lease-adjusted debt to
EBITDA should fall to 2.5x-3x, while funds from operations to
total debt should strengthen to 25% over the intermediate term.

"We have met with management to discuss near-term business trends
and the company's financial policies, including its willingness to
use additional equity on larger-sized acquisitions and thus
support its credit profile," said Standard & Poor's credit analyst
Paul Kurias.  "We believe that further improvement to URS' credit
profile is likely over the next several quarters as earnings
improve and free cash flow is used to reduce debt further.
Therefore, the company should start to generate pro forma credit
protection measures above our current expectations within the next
few quarters.  Should the equity offering and debt tender offer
occur as predicted, we will raise our corporate credit rating to
'BB+' and assign a stable outlook."

Standard & Poor's is currently assessing the benefits of the
collateral package on URS' proposed $650 million secured bank
credit facility.  Standard & Poor's plans to rate the facility
shortly.


US AIRWAYS: Amadeus Global Holds Allowed $1,565,533 Admin. Claim
----------------------------------------------------------------
Amadeus Global Travel Distribution, S.A., is granted an
administrative claim for $1,565,533, which will be paid on the
effective date of a plan of reorganization for US Airways, Inc.,
its debtor-affiliates.

As reported in the Troubled Company Reporter on May 30, 2004, the
claim is equal to 50% of the amount held in escrow by
International Air Transport Association in settlement of the
parties dispute over Debtors' use of the IATA rules and
procedures.  Amadeus Global alleged that the Debtors is hiding
behind IATA's rules and procedures to avoid paying the $3,131,065,
they owe to Amadeus.

The Debtors pay Amadeus to distribute their schedules, inventory,
fares, fare rules, and seat availability to subscribers and then
sell seats on the Debtors' planes.  The Debtors pay Amadeus
through the International Air Transport Association Clearing House
system, which is operated by the International Air Transport
Association.

Headquartered in Arlington, Virginia, US Airways' primary business
activity is the ownership of the common stock of:

            * US Airways, Inc.,
            * Allegheny Airlines, Inc.,
            * Piedmont Airlines, Inc.,
            * PSA Airlines, Inc.,
            * MidAtlantic Airways, Inc.,
            * US Airways Leasing and Sales, Inc.,
            * Material Services Company, Inc., and
            * Airways Assurance Limited, LLC.

Under a chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors
in their restructuring efforts.  In the Company's second
bankruptcy filing, it lists $8,805,972,000 in total assets and
$8,702,437,000 in total debts.  (US Airways Bankruptcy News, Issue
No. 94; Bankruptcy Creditors' Service, Inc., 215/945-7000)


USGEN NEW ENGLAND: 2nd Amended Liquidation Plan Takes Effect
------------------------------------------------------------
John Lucian, Esq., at Blank Rome LLP, in Baltimore, Maryland,
advises the U.S. Bankruptcy Court for the District of Maryland
that the Effective Date of USGen New England, Inc.'s Second
Amended Plan of Liquidation has been fixed at June 1, 2005.

Pursuant to USGen's Plan, requests for payment of Administrative
Claims that have arisen or will arise in the period from the
Petition Date through and including the Confirmation Date must be
filed by June 12, 2005.  Requests for payment of Administrative
Claims that will arise in the period from the Confirmation Date
through and including the Effective Date must be filed by July 1.

Any claimant, other than a holder of a Fee Claim or for an
Ordinary Course Payment, that is required, but fails to file an
Administrative Claim on or before the Administrative Bar Date, as
applicable, will be forever barred from asserting the claim and
enjoined from commencing or continuing any action to collect,
offset or recover the claim.

Requests for allowance or payment of a Fee Claim for any period
ending on or before the Effective Date must be filed no later
than July 16, 2005.

The Court confirmed the Debtor's Second Amended Plan of
Liquidation on May 13, 2005.

Headquartered in Bethesda, Maryland, USGen New England, Inc., an
affiliate of PG&E Generating Energy Group, LLC, owns and operates
several electric generating facilities in New England and
purchases and sells electricity and other energy-related products
at wholesale.  The Debtor filed for Chapter 11 protection on July
8, 2003 (Bankr. D. Md. Case No. 03-30465).  John E. Lucian, Esq.,
Marc E. Richards, Esq., Edward J. LoBello, Esq., and Craig A.
Damast, Esq., at Blank Rome, LLP, represent the Debtor in its
restructuring efforts.  When it sought chapter 11 protection, the
Debtor reported assets amounting to $2,337,446,332 and debts
amounting to $1,249,960,731.  The Debtor filed its Second Amended
Plan of Liquidation and Disclosure Statement on March 24, 2005
(PG&E National Bankruptcy News, Issue No. 44; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


VALLEY MEDIA: Inks $65,000 Settlement Pact with TeeVee Toons
------------------------------------------------------------
On August 5, 2002, Valley Media Inc. commenced an avoidance action
against TeeVee Toons Inc.  The suit sought to recover a $1,492,084
transfer to TeeVee that the Debtor made within 90 days prior to
its bankruptcy filing on November 20, 2001.

Two months after the avoidance action was filed, TeeVee filed its
answer with the Bankruptcy Court denying the Debtor's allegations.

The parties then negotiated and arrived at a settlement agreement.
Under the agreement, TeeVee agrees to pay the Debtor $65,000 to
settle the dispute.  The parties will also exchange mutual
releases.

Accordingly, Valley Media Inc. asks the U.S. Bankruptcy Court for
the District of Delaware to approve the settlement.

Headquartered in Woodland, California, Valley Media, Inc.
-- http://www.valleymedia.com/-- was a full-line distributor of
music and video entertainment products.  The Company filed for
chapter 11 protection on November 20, 2001 (Bankr. D. Del. Case
No. 01-11353).  Robert J. Dehney, Esq., and Michael G. Busenkell,
Esq., at Morris, Nichols, Arsht & Tunnell represent the Debtor.
When the Debtor sought protection from its creditors, it listed
$241,547,000 in total assets and $259,206,000 in total debts.
Judge Walsh entered an order confirming Valley Media's Liquidating
Plan on May 6, 2005.  A summary of that plan appeared in the
Troubled Company Reporter on Mar. 29, 2005, and Feb. 22, 2005.


VENTAS INC: Completes $1.2 Billion Provident Trust Acquisition
--------------------------------------------------------------
Ventas, Inc., (NYSE: VTR) completed the $1.2 billion acquisition
of Provident Senior Living Trust.  The transaction adds 68
high-quality, private-pay independent and assisted living
properties containing 6,819 units to its extensive portfolio of
assets.  As a result of the transaction, 41 percent of the
Company's annualized revenues will come from private-pay sources.

The Ventas portfolio is now comprised of 369 senior housing and
healthcare facilities with excellent geographic distribution
across 41 states.  Its annualized revenues (as if all 2005
acquisitions closed on January 1) will increase to more than
$370 million.

"The Provident acquisition demonstrates our consistent focus on
building a superior company designed to deliver reliable, growing
cash flows and to benefit from the positive operating and
demographic fundamentals in the long term care sector.  With an
enterprise value of $4.5 billion, Ventas's portfolio is well
diversified by tenant, by asset type and by geography," Ventas
Chairman, President and CEO Debra A. Cafaro said.  "We expect the
acquisition to be about $0.20 accretive to our 2006 normalized
Funds From Operations (FFO) per share and to add to our internally
generated annual cash flow growth."

The Company intends to provide updated guidance on its projected
2005 and 2006 normalized FFO following the completion of the
Provident integration.

Provident shareholders, who approved the acquisition on June 6,
received 0.4951 of a share of Ventas common stock and $7.81 in
cash for each Provident share.  Ventas funded the cash portion of
the acquisition, repayment of certain Provident indebtedness and
transaction costs with a combination of:

     (a) proceeds from the sale of $350 million aggregate
         principal amount of five- and ten-year unsecured senior
         notes issued by Ventas Realty, Limited Partnership and
         Ventas Capital Corporation; and

     (b) a draw on Ventas's revolving credit facility.

The acquisition did not require the vote of Ventas shareholders.

Ventas said it expects the Provident acquisition to reduce the
percentage of rent received by the Company from its primary
tenant, Kindred Healthcare, Inc. (NYSE: KND), to about 54 percent
of annualized revenues and to decrease the percentage of rent
received from skilled nursing facilities to about 38 percent of
annualized revenues.

No changes will be made to the Ventas Board of Directors or senior
management team as a result of the Provident transaction.

In the transaction, Merrill Lynch & Co., Inc. acted as Ventas's
exclusive financial advisor, and Friedman, Billings, Ramsey & Co.,
Inc. acted as Provident's financial advisor.

Ventas, Inc. -- http://www.ventasreit.com/-- is a leading
healthcare real estate investment trust that owns and invests in
healthcare and senior housing assets in 41 states.  Its properties
include hospitals, skilled nursing facilities and assisted and
independent living facilities.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 15, 2005,
Moody's Investors Service affirmed the ratings of Ventas, Inc.,
and its affiliates following the announcement that Ventas and
Provident Senior Living Trust have decided to merge.  The
transaction, valued at $1.2 billion, will be funded by Ventas
common stock, the assumption of debt and cash.  Provident is an
unlisted senior living REIT that owns 68 independent and assisted
living facilities in 19 states.

Moody's remarked that the planned merger with Provident would be a
plus for Ventas along several dimensions.  First, Ventas' pro
forma exposure to Kindred Healthcare Inc. -- its main tenant --
would be reduced substantially from 76% of revenues in 2004.
Moody's also notes that Ventas' key tenant exposure would now be
with two tenants: Kindred and Brookdale Living Communities Inc.

This material, new exposure to Brookdale is a concern, however.
Continued progress in tenant diversification would be a plus.
In addition, the Provident transaction would reduce substantially
Ventas' exposure to the regulated government reimbursement-based
health care segments of skilled nursing facilities and long-term
acute care facilities from 84% in 2004.

These positive changes to Ventas' portfolio and tenant composition
would be offset by the decline in the REIT's balance sheet
strength resulting from this merger, earmarked by a significant
rise in both leverage and secured debt.  While the rating agency
believes this rise in overall and secured debt will be reduced
over time, such anticipated reductions would not be adequate to
achieve a higher rating for Ventas at this time.  In specific, a
rating upgrade to Ba2 senior debt would depend on pro forma debt
to gross assets being less than 55%, and near-term efforts to
reduce pro forma secured debt.

These ratings were affirmed, with a positive outlook:

Ventas Realty Limited Partnership:

   * Senior debt at Ba3
   * senior debt shelf at (P)Ba3
   * subordinated debt shelf at (P)B2

Ventas, Inc.:

   * Preferred stock shelf at (P)B2

Ventas Capital Corporation:

   * senior debt shelf at (P)Ba3
   * subordinated debt shelf at (P)B2

Ventas, Inc. [NYSE: VTR] is a health care real estate investment
trust that owns:

   * forty long-term acute care hospitals,
   * 201 nursing facility,
   * thirty assisted and independent living facilities,
   * eight medical office buildings, and
   * eight other health care assets, in 39 states.


W.R. GRACE: Senate Panel Rejects Cleanup Claims in S. 852
---------------------------------------------------------
By a vote of 11-6, the Senate Judiciary Committee rejected an
amendment to the US$140 billion Fairness in Asbestos Injury
Resolution Act of 2005, S. 852, that would compensate Easthampton
residents and 27 other communities where asbestos-contaminated ore
from the W.R. Grace mine in Libby, Montana was shipped, processed
and dumped.

Sen. Edward M. Kennedy, D-Mass., offered an amendment to cover
Easthampton where 258,000 tons of vermiculite ore laced with
tremolite asbestos was processed at the W.R. Grace plant, which
made Zonolite attic insulation from 1964 to 1983. Sen. Lindsey
Graham, R-S.C., joined Sen. Kennedy's amendment by expanding its
language to give the same protections to the residents of those
towns as the bill gives to the people of Libby.

Instead, the Senate Judiciary Committee approved an amendment
that calls for a study that would ultimately cover Easthampton
and the other locations if tests show the level of ambient
asbestos contamination is the same level found in Libby. Both
Sen. Kennedy and Sen. Graham said the testing would be
meaningless because exposure at far less levels than seen at
Libby could still be harmful if not fatal.

Sen. Kennedy said there was no scientific or logical reason to
differentiate Libby residents from residents of the areas where
the contaminated ore was shipped and processed. At issue, both
senators argued, is a question of fairness.

Sen. Arlen Specter, R-Pa., told Sen. Kennedy that the committee
has recently learned that other communities have similar
problems as seen in Libby and is trying to delineate exactly how
extensive they are before deciding what the committee can do
about it. But Sen. Kennedy and Sen. Graham wanted the 28
communities where Grace owned and operated processing plants
included in the bill now. They argued that if the trust fund can
compensate the people of Libby, it should also give compensation
to the people who lived in the towns where the contaminated ore
was shipped and processed.

Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.  The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. Del. Case No. 01-01139).  James H.M. Sprayregen, Esq., at
Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  (Class Action Reporter,
June 3, 2005)


W.R. GRACE: New Jersey Attorney General Sues for False Reports
--------------------------------------------------------------
Attorney General Peter C. Harvey filed suit against W.R. Grace &
Co. and two former company executives for falsely certifying to
the New Jersey Department of Environmental Protection in 1995 that
any hazardous asbestos contamination at the company's Hamilton
Township plant had been cleaned up in accordance with state
requirements. In fact, more than 15,000 tons of contaminated soil
remained at the site when Grace closed the plant.  Some soil
samples contained concentrations of hazardous asbestos as high as
40 percent of the sample.

Attorney General Harvey filed the suit on behalf of DEP in
Superior Court in Mercer County seeking civil monetary penalties
against the company and the two individual defendants under the
New Jersey Spill Compensation and Control Act and the New Jersey
Industrial Site Recovery Act.

The Attorney General's Office is reviewing whether additional
legal actions, including criminal charges, can be brought against
W.R. Grace and other defendants in connection with the Hamilton
plant.  The Office has requested that the U.S. Environmental
Protection Agency and other federal authorities share information
from their investigation of W.R. Grace.

"We are seeking major civil penalties against these defendants who
deliberately concealed the extensive asbestos contamination that
W.R. Grace had caused at its Hamilton Township plant," said
Attorney General Harvey.  "The defendants acted in complete
disregard for the health and safety of the neighboring community
and the future occupants of this site.  Going forward, we will
continue to review all new facts and all legal options available
to the State in this matter."

"We have zero tolerance for companies like Grace that, in this
case, clearly failed to note asbestos contamination when reporting
about environmental conditions at its Hamilton site," said DEP
Commissioner Bradley M. Campbell.  "It is essential that the
Attorney General take this action . . . to safeguard communities
like Hamilton from companies that ignore their environmental
responsibilities."

The corporate defendants named in the suit are W.R. Grace &
Co., its successor W.R. Grace & Co.-Conn., and Grace-Conn
Successor, a fictitious successor-in-interest.  The individual
defendants who allegedly made the false certifications for Grace
are Jay H. Burrill, who was Environmental Coordinator for Grace at
the time, and Robert J. Bettacchi, who was Vice President.

       W.R. Grace's Concealment of Asbestos Contamination

Grace is under federal criminal indictment on charges related to
the operation of its vermiculite ore mine in Libby, Montana, where
workers and residents in the surrounding community allegedly
contracted asbestos-related diseases from the company's milling of
ore containing hazardous concentrations of tremolite asbestos.

Grace shipped several hundred thousand tons of vermiculite
concentrate milled from ore at the Libby mine to the Hamilton
plant from 1957 to 1991.  Grace used the vermiculite concentrate
at the Hamilton plant to manufacture products such as fire-
retardant insulation, material for lightweight concrete, and
fertilizer.

The complaint alleges that defendants knew that dust and other
waste containing hazardous concentrations of asbestos fibers were
generated by Grace's manufacturing operations, and that asbestos
fibers had contaminated the Hamilton plant and the soil at the
site.  The complaint alleges that although the defendants knew
these facts, they falsely certified on June 2, 1995 that any
hazardous substances discharged at the Hamilton plant had been
cleaned up in accordance with DEP regulations.

The false representations were contained in two documents filed
with DEP to meet requirements of ISRA triggered when Grace closed
the plant: a Preliminary Assessment/Site Investigation and a
Negative Declaration, each certified by Burrill and Bettacchi.
Burrill and Bettacchi certified that the information submitted was
true, accurate and complete. On the basis of those submissions,
DEP issued a No Further Action letter for the site.

After the severe health problems came to light involving workers
and local residents in Libby, the U.S. Environmental Protection
Agency began testing at Grace plants around the country that used
the Libby vermiculite ore.  Soil samples taken by EPA in 2001 at
the Hamilton facility showed asbestos concentrations as high as 40
percent.  From 2003 to 2004, Amtrak and American Premium
Underwriter Inc., which allegedly have ownership and successor
liability for the site, excavated and disposed of 9,000 tons of
asbestos-contaminated soil from the site and nearby areas under
EPA supervision.  It is anticipated that they will excavate an
additional 6,000 tons of asbestos-contaminated soil this summer.

DEP has rescinded its No Action Letter and is working with EPA to
address contamination concerns both on and off-site.  The
Department of Health and Senior Services has issued reports on two
health consultations of the site and is currently attempting to
locate and reach out to former employees to evaluate health
implications of past exposure to former workers, their families,
and the surrounding community.

The complaint seeks assessment of a civil penalty against each
defendant under ISRA of $50,000 - $25,000 for each document -- for
submission of false information, and an additional $50,000 -- for
each day the defendant failed to correct the false information. In
addition, it seeks assessment of a civil penalty against each
defendant under the Spill Act of $100,000 - $50,000 for each
document - for knowingly giving false testimony, documents or
information to DEP, and an additional $100,000 for each day the
defendant failed to correct the false information.  The complaint
also seeks attorney's fees and costs.

A full-text copy of the 23-page Complaint is available for free at
http://researcharchives.com/t/s?e

                          Grace Comments

In a regulatory filing with the Securities and Exchange
Commission, Grace disclosed that it submitted a Site
Investigation Report, which was prepared by an independent
environmental consultant, in connection with the closing of the
company's former plant in Hamilton Township, New Jersey.

Grace purchased the Hamilton plant in 1963 and ceased operations
there in 1994.  During this period, Grace produced spray-on fire
protection products and vermiculite-based products at the plant.

Grace said it is unable at this time to assess the effect of the
lawsuit on its results of operations or financial condition, or
on its bankruptcy proceeding.

Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.  The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. Del. Case No. 01-01139).  James H.M. Sprayregen, Esq., at
Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  (W.R. Grace Bankruptcy
News, Issue No. 87; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


WESTCHESTER COUNTY: Moody's Pares Sr. Debt Rating to Ba2 from Ba1
-----------------------------------------------------------------
Moody's has downgraded to Ba2 from Ba1 the senior debt rating
assigned to Westchester County Health Care Corporation -- WCHCC.
The Ba2 rating will remain on Watchlist for further possible
downgrade.  This Watchlist action is anticipated to be resolved
with the receipt of the audited financial statements (FYE 2004)
expected to be completed sometime in July 2005, and verification
that the operating loss meets our current expectation of a
$56 million operating deficit.

Within the next few weeks, we would also know if legislative aid
in the form of a sales tax or special Medicaid reimbursement
is forthcoming.  The downgrade to Ba2 affects approximately
$112 million of outstanding senior lien bonds.  The $141.9 million
of subordinated debt, which carries a guarantee from Aaa-rated
Westchester County (with a negative outlook), as well as the 2002
Series F General Obligation bonds issued by Westchester County on
behalf of WCHCC, are not affected by this rating action.

WCHCC continues to struggle financially and early projections of a
return to closer to breakeven performance by fiscal year end 2005
will not be realized.  Unaudited financial results for the 2004
fiscal year indicate a loss in excess of $55 million from
operations and the audit is not anticipated to be completed before
mid-July.  Very thin liquidity has been an ongoing concern of
Moody's and remains a critical part of the downgrade decision.
Unaudited cash at December 31, 2004 was $24.3 million or
11.4 days of cash on hand and 6.6% cash to debt but that includes
a $14 million pension payment that was delayed from year-end and
paid in April 2005.

Excluding the pension payment from cash, would result in days cash
declining to six days of cash on hand.  The County will be
refinancing 1999 tobacco bonds in order release trapped funds
amounting to approximately $27 million which will be provided to
WCHCC, but given WCHCC's current burn rate of $4 million per
month, that cash will also be depleted by year end and another
pension payment of similar size will be due in the first quarter
of fiscal 2006

While some progress has been noted since the facility hired
consultants as its interim management team to stem the spiraling
operating deficits, we believe the lack of onsite management with
a long-term vested interest in the facility is a negative credit
factor.  The financial problems at WCHCC remain complex and basic
initiatives are still being implemented to capture charge data
correctly, streamline the inpatient intake process and make the
facility more user friendly to physicians and patients being
transferred from other hospitals.

Moody's concurs with the interim management's opinion that WCHCC
is not viable without external financial support but are
disconcerted that no long-term solution has been developed if the
legislative proposals to generate annual revenue for WCHCC do
not come to fruition.  Two plans are being proposed for the
$60 million of external support needed, with varying amounts of
support provided from county, state and federal sources.  The
county continues to work on behalf of WCHCC to garner external
funding and we are incorporating the vested interest of the county
for WCHCC to remain operational in our downgrade and rating
assessment.


WESTPOINT STEVENS: Court Approves 7th Amendment to DIP Financing
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approves the Seventh Amendment to WestPoint Stevens, Inc. and its
debtor-affiliates' DIP Credit Agreement, dated as of April 12,
2005.  The Seventh Amendment:

    -- amends the EBITDA and Minimum Availability covenants set
       forth in Sections 7.23 and 7.24;

    -- extends the term of the DIP Agreement to the earliest to
       occur of:

       a. December 2, 2005; or

       b. the consummation of a sale, pursuant to Section 363 of
          the Bankruptcy Code or pursuant to a confirmed plan of
          reorganization or liquidation pursuant to Chapter 11 of
          the Bankruptcy Code, of all or a substantial portion of
          the assets of the Registrant or other Borrower under the
          DIP Agreement; and

    -- amends the requirement that the Registrant furnish audited
       financial statements to the Administrative Agent by
       providing that unaudited financial statements may be
       provided that meet certain GAAP requirements.

Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings.  It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers.  (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores.  Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens.  The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532).  John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 46; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WINN-DIXIE: Retirees Want Additional Committee Appointed
--------------------------------------------------------
In the ordinary course of business, Winn-Dixie Stores, Inc., and
its debtor-affiliates maintain nonqualified plans for the benefit
of retired employees, including a Management Security Plan and a
Supplemental Retirement Plan.

David R. McFarlin, Esq., in Orlando, Florida, relates that the MSP
provides death and retirement benefits to certain executives and
members of management.  The MSP is contributory, but is not
funded.  The Debtors provide similar benefits to non-management
employees through the SRP, which is fully funded through a Rabbi
Trust.

Prior to filing the chapter 11 petition, the Debtors paid about
$500,000 per month to their employees and their beneficiaries in
connection with the Non-Qualified Plans.  The participants in the
Non-Qualified Plans are not covered by a collection bargaining
agreement.  Mr. McFarlin reports that there are approximately
1,000 participants in the Non-Qualified Plans with aggregate
claims of $100 million.

Section 1102(a)(2) of the Bankruptcy Code provides that:

     "On request of a party in interest, the court may order
     the appointment of additional committees of creditors
     . . . if necessary to assure adequate representation of
     creditors. . . .  The United States Trustee shall
     appoint any such committee."

Accordingly, certain participants of the Non-Qualified Plans ask
the Court to direct the appointment of an additional committee of
creditors to address their interests.  The Participants include:

    -- Richard Ehster,
    -- Bradley T. Keller,
    -- Judith W. Dixon,
    -- Lawrence H. May, Jr.,
    -- Larry A. Beck, and
    -- Ernest G. Hurst

The Participants have requested the United States Trustee to
appoint an additional committee to represent the interests of
participants in the Non-Qualified Plans.  However, an additional
committee has not been appointed, Mr. McFarlin says.

Mr. McFarlin reports that in the Debtors' Schedules of Assets and
Liabilities and Statements of Financial Affairs, notwithstanding
the magnitude of the claims, the Participants were not separately
listed.  As a result, the Participants did not receive notice of
the Debtors' Chapter 11 cases.  Furthermore, the Participants had
no opportunity to participate in any of the "1st day motions" or
the selection of the committee of unsecured creditors.

As retirees and current employees of the Debtors, Mr. McFarlin
points out that the Participants have interests far removed and
potentially in conflict with the claims of general unsecured
creditors.

"A simple, but glaring example," Mr. McFarlin notes, "is the
support by the creditors' committee to retain venue of this case
in New York when the employees and retirees are located almost
exclusively in the South Eastern portion of the country with the
largest representation in the State of Florida."

                            Objections

(1) Creditors Committee

The Official Committee of Unsecured Creditors believes that the
Participants are seeking a drastic remedy, rarely granted by the
courts.  John B. Macdonald, Esq., at Akerman Senterfitt, in
Jacksonville, Florida, argues that the Participants fail to
provide any evidence that the Creditors Committee does not
already adequately represent their interests.  The Creditors
Committee believes that United States Trustee has properly denied
the Participants' request.

The United States Trustee's denial, Mr. Macdonald points out,
constitutes a reasonable and eminently proper exercise of the
discretion granted by Congress, and should not be overruled by
the Court.

Mr. Macdonald asserts that the Creditors Committee, whose
membership reflects a cross-section of the Debtors' general
unsecured creditors, already adequately represents the
Participants' interests of maximizing the value of the Debtors'
estates and the distribution to all of the Debtors' unsecured
creditors.  To the extent the Participants have an interest that
is distinct from the interests of the other unsecured creditors,
Mr. Macdonald notes that that interest is solely to compel the
Debtors to assume the Retirement Plans as executory contracts.

A retiree committee would exist solely to increase the
administrative costs of the Debtors' estates, Mr. Macdonald says.
Once the Retirement Plans are assumed, there is no need to
negotiate the distributions to, or other treatment of, the claims
of the Retirement Plans' beneficiaries because payment in full in
accordance with the terms of the Retirement Plans would be
mandated by the Bankruptcy Code.  Appointing an official
committee of retirees, funded by the Debtors' estates, to pursue
a narrow interest at the expense of the estates and their general
unsecured creditors is simply not warranted by applicable law.

Mr. Macdonald further argues that the United States Trustee's
judgment must be upheld because:

   (a) the Participants have utterly failed to carry their burden
       of proof under Section 1102(a)(2) of the Bankruptcy Code;
       and

   (b) Section 1114(d) of the Bankruptcy Code is not applicable
       or, to the extent it is applicable, its application is, at
       best, premature because, among other things, the Debtors
       have not sought to cease paying or otherwise modify
       retiree benefits.

Accordingly, the Creditors Committee asks the Court to deny the
Participants' request.

(2) Debtors

D.J. Baker, Esq., at Skadden, Arps, Slate, Meagher & Flom, in New
York, tells Judge Funk that the appointment of a Second Creditors
Committee is not necessary to assure adequate representation of
the Participants' interests.  "The [Participants] are contingent
unsecured creditors.  In the event that the Non-Qualified Plans
are assumed, then the [Participants] will receive all benefits
and will not hold unsecured claims against the Debtors' estates,"
Mr. Baker asserts.

In the event that the Non-Qualified Plans are rejected, Mr. Baker
points out that the Participants will have claims under the Non-
Qualified Plans that will be treated pari passu with all other
general unsecured creditors.  Moreover, Mr. Baker notes, the
Creditors Committee, which has a diverse membership and a
fiduciary duty to represent the interests of all unsecured
creditors, assures that the interests of Participants are
adequately represented if the Non-Qualified Plans are rejected.

Mr. Baker also tells the Court that the Debtors have every
intention of honoring their obligations to pay benefits protected
by Section 1114 and have not modified or sought to modify those
benefits.  "Indeed, the Debtors have shown the opposite
inclination by continuing to pay benefits under the Non-Qualified
Plans that are not subject to the protections of [Section 1114],"
Mr. Baker says.

The Debtors would not object if the U.S. Trustee, in the exercise
of its discretion, were to appoint a Plan Participant to serve on
the Creditors Committee.

(3) U.S. Trustee

Felicia S. Turner, the United States Trustee for Region 21, has
considered that eligible recipients of the Non-Qualified Plans
are currently receiving payments pursuant to the Court Order
authorizing the Debtors to pay:

    (a) prepetition compensation, payroll taxes, employee
        benefits, and related expenses;

    (b) expenses related to independent contractors; and

    (c) certain retiree benefits.

In the event the Non-Qualified Plans are assumed, the U.S.
Trustee notes that the Participants will receive all benefits and
will not hold an unsecured claim against the Debtors.
Furthermore, in the event the Non-Qualified Plans are rejected,
the Participants will be treated pari passu with all other
general unsecured claims.  The claims under the Non-Qualified
Plans, if rejected, have the same legal status and entitlement as
the claims now represented on the unsecured creditors committee.

According to the U.S. Trustee, the Official Committee of
Unsecured Creditors assures adequate representation to the
Participants in the event the Non-Qualified Plans are rejected.
The goal of the Creditors Committee is to maximize the value of
Debtors' assets and thereby to maximize recovery for all general
unsecured creditors including participants of the Plan as
applicable.

The U.S. Trustee believes that the creation of an additional
committee to represent a single group of unsecured creditors to
advocate their particular self-interests would result in
additional cost and complexity, and allow for other creditor
groups like landlords and trade creditors to advocate creation of
separate committees.

The U.S. Trustee is investigating the possibility of adding one
or more plan participants to the Creditors Committee.

                          *     *     *

At the hearing on June 2, 2005, Judge Funk ruled that the matter
will be taken under advisement.  An order will be forthcoming.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc. --
http://www.winn-dixie.com/-- is one of the nation's largest food
retailers.  The Company operates stores across the Southeastern
United States and in the Bahamas and employs approximately 90,000
people.  The Company, along with 23 of its U.S. subsidiaries,
filed for chapter 11 protection on Feb. 21, 2005 (Bankr. S.D.N.Y.
Case No. 05-11063).  The Honorable Judge Robert D. Drain ordered
the transfer of Winn-Dixie's chapter 11 cases from Manhattan to
Jacksonville.  On April 14, 2005, Winn-Dixie and its debtor-
affiliates filed for chapter 11 protection in M.D. Florida (Case
No. 05-03817 to 05-03840).  D.J. Baker, Esq., at Skadden Arps
Slate Meagher & Flom LLP, and Sarah Robinson Borders, Esq., and
Brian C. Walsh, Esq., at King & Spalding LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $2,235,557,000 in
total assets and $1,870,785,000 in total debts.  (Winn-Dixie
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service,
Inc., 215/945-7000).


WINN-DIXIE: Heinz & Robinson Group Want to Resolve PACA Claims
--------------------------------------------------------------
As previously reported on the Troubled Company Reporter on May 20,
2005, on March 22, 2005, the U.S. Bankruptcy Court for the
Southern District of New York granted Winn-Dixie Stores, Inc., and
its debtor-affiliates authority to pay prepetition claims arising
under the Perishable Agricultural Commodities Act and the Packers
and Stockyard Act.

The procedures established by the PACA Order require the Debtors
to file a Report with the Court setting forth the status and
information on the PACA Claims.

                         More Responses

(1) Heinz

    As of the Petition Date, Heinz Frozen Food, a division of
    H.J. Heinz Company, L.P., was owed $927,500 in outstanding
    invoices for frozen food products, $353,906 of which is a
    PACA claim.  However, Heinz's PACA claim is itemized in the
    Debtors' PACA Report as "not fully reconciled".  The Report
    further represents that $106,750 of the claim would be "paid
    within 10 days and that $806,065 was "subject to further
    reconciliation and resolution".  After the Report was filed,
    Heinz and the Debtors tried to resolve the remainder of the
    PACA claim but have been unable to do so.  Heinz provided the
    Debtors with detailed breakdowns for each outstanding
    invoice, indicating the products for which PACA coverage is
    sought and those which Heinz acknowledges are not subject to
    the PACA trust protection.

    The products for which Heinz seeks PACA trust coverage are,
    for the most part, frozen potatoes in various cuts and sizes.
    The Debtors apparently object to PACA trust coverages for
    types of "french fry" products, despite regulations that
    provide to the contrary.

    The United States Department of Agriculture published a
    revised version of 7 C.F.R. Section 46.2(u) on May 2, 2003,
    to specifically include "battering" and "coating" as allowed
    processes which do not convert the potatoes into a "food of
    different kind or character".  Clearly, Heinz points out, the
    focus of these PACA definitions is to rule out any fruits
    or vegetables that have been "over-processed" to the point
    the produce item has been manufactured into "a food of a
    different kind or character".

    Heinz believes that the applicability of the amended USDA
    regulation to the undisputed facts of the Debtors' case is an
    issue which controls the validity of its PACA trust claims.
    Accordingly, Heinz asks the Court to compel the Debtors to
    satisfy its PACA claim.

(2) The Robinson Group

    C.H. Robinson Company, Del Monte Fresh Produce, N.A., Inc.,
    Lamb-Weston, Inc., MarBran USA, and Avomex, Inc., were listed
    on the Debtors' PACA Report.  The Claimants have portions of
    their claims that were allowed and have since been paid, and
    portions which the Debtors believe are invalid or have
    otherwise not yet been fully reconciled.

    C.H. Robinson and Lamb-Weston object to the principal amount
    listed in the Report.  Allan C. Watkins, Esq., in Tampa,
    Florida, contends that C.H. Robinson's PACA claim should
    properly be listed as $2,525,748 while Lamb-Weston's PACA
    claim should be properly listed as $225,500.

    All members of the Robinson Group accept the reconciled and
    paid portions of their claims to date, while reserving all
    rights and remedies to the full principal balances due plus
    interest and attorneys fees.

    Furthermore, all members of the Robinson Group object to any
    and all portions of their PACA claims, which the Debtors have
    not yet paid or which are subject to future reconciliation.

    The Robinson Group will continue to work with the Debtors'
    representatives to fully reconcile and resolve all claims.
    In the interim, the Robinson Group reserves all rights and
    remedies, consistent with the PACA Order, until all of the
    Robinson Group's PACA claims are paid in full.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc. --
http://www.winn-dixie.com/-- is one of the nation's largest food
retailers.  The Company operates stores across the Southeastern
United States and in the Bahamas and employs approximately 90,000
people.  The Company, along with 23 of its U.S. subsidiaries,
filed for chapter 11 protection on Feb. 21, 2005 (Bankr. S.D.N.Y.
Case No. 05-11063).  The Honorable Judge Robert D. Drain ordered
the transfer of Winn-Dixie's chapter 11 cases from Manhattan to
Jacksonville.  On April 14, 2005, Winn-Dixie and its debtor-
affiliates filed for chapter 11 protection in M.D. Florida (Case
No. 05-03817 to 05-03840).  D.J. Baker, Esq., at Skadden Arps
Slate Meagher & Flom LLP, and Sarah Robinson Borders, Esq., and
Brian C. Walsh, Esq., at King & Spalding LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $2,235,557,000 in
total assets and $1,870,785,000 in total debts.  (Winn-Dixie
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service,
Inc., 215/945-7000).


WINN-DIXIE: UST Withdraws Objection to Smith Hulsey Engagement
--------------------------------------------------------------
The U.S. Trustee withdraws its request for reconsideration of the
order authorizing Winn-Dixie Stores, Inc., and its debtor-
affiliates' employment of Smith Hulsey and Busey based on the
information provided by D.J. Baker, Esq., an attorney at Skadden,
Arps, Slate, Meagher & Flom, LLP, the Debtors' bankruptcy counsel.
Mr. Baker assures the U.S. Trustee regarding Skadden's ability to
pursue any litigation against Wachovia if necessary, on behalf of
the Debtors.

As previously reported in the Troubled Company Reporter on May 20,
2005, Felicia S. Turner, United States Trustee for Region 21,
objected to the application of the Debtors' employment of Smith
Hulsey and Busey, as the Debtors' bankruptcy local Florida
counsel.

The U.S. Trustee explained that Smith Hulsey has a conflict that
precludes it from diligently representing the Debtors in regards
to Wachovia Bank, NA.  The U.S. Trustee had filed a request for
reconsideration of the order authorizing employment of Smith
Hulsey & Busey.  The U.S. Trustee believed that if the Motion for
Reconsideration was granted, and the employment of Smith Hulsey
was not approved, the Debtors will be able to find a firm that can
adequately represent their interests with regards to Wachovia
without the need for hiring a third counsel.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc. --
http://www.winn-dixie.com/-- is one of the nation's largest food
retailers.  The Company operates stores across the Southeastern
United States and in the Bahamas and employs approximately 90,000
people.  The Company, along with 23 of its U.S. subsidiaries,
filed for chapter 11 protection on Feb. 21, 2005 (Bankr. S.D.N.Y.
Case No. 05-11063).  The Honorable Judge Robert D. Drain ordered
the transfer of Winn-Dixie's chapter 11 cases from Manhattan to
Jacksonville.  On April 14, 2005, Winn-Dixie and its debtor-
affiliates filed for chapter 11 protection in M.D. Florida (Case
No. 05-03817 to 05-03840).  D.J. Baker, Esq., at Skadden Arps
Slate Meagher & Flom LLP, and Sarah Robinson Borders, Esq., and
Brian C. Walsh, Esq., at King & Spalding LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $2,235,557,000 in
total assets and $1,870,785,000 in total debts.  (Winn-Dixie
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service,
Inc., 215/945-7000).


* Mark Heilbrun Joins Jenner & Block's Litigation Practice
----------------------------------------------------------
Mark Heilbrun has joined Jenner & Block's Washington, DC, office
as a Partner in its Litigation and Public Policy Practices.  Mr.
Heilbrun brings to the Firm over fifteen years of experience in
the public and private sectors.

Before joining Jenner & Block, Mr. Heilbrun was the Deputy Staff
Director and General Counsel of the United States Senate Committee
on the Judiciary.  In that post, Mr. Heilbrun had responsibility
for a broad range of issues, including oversight of the judiciary
and the courts; the Constitution, civil rights and property
rights; antitrust and competition policy; crime, corrections and
victims rights; immigration and border security; patents,
copyrights and trademarks; bankruptcy; and terrorism, technology
and homeland security.  Mr. Heilbrun also served as Legislative
Director to Senator Arlen Specter (R-PA), and in that capacity
negotiated and drafted significant portions of the Homeland
Security Act of 2002 and the Intelligence Reform and Terrorism
Prevention Act of 2004, among others.

"I have worked with Mark for many years, and can attest to his
consummate legal and political skills," said Arlen Specter,
Chairman of the Senate Judiciary Committee.

"We're delighted to have someone with Mark's extensive experience
joining our practice," said Paul M. Smith, Managing Partner of
Jenner & Block's Washington, DC office and Co-Chair of the Firm's
Appellate and Supreme Court Practice.

After graduating from the University of Texas at Austin School of
Law in 1990 with honors, Mr. Heilbrun received an appointment as
Counsel to the United States Intelligence Community Staff and
remained in the Intelligence Community during both the Bush and
Clinton administrations.  From 1995 to 1997, he served as Deputy
General Counsel to the United States Senate Select Committee on
Intelligence, where he negotiated and drafted the Economic
Espionage Act of 1996, the only comprehensive federal criminal
trade secrets protection statute to date.  Mr. Heilbrun was also a
senior litigation counsel at Baker & McKenzie.


* Paul R. Ferretti Joins Morgan Joseph's Equity Research Dept.
--------------------------------------------------------------
Morgan Joseph & Co., Inc., welcomes Paul R. Ferretti as a Managing
Director in the Firm's Equity Research Department where he will be
responsible for overall Energy sector coverage.

At Morgan Joseph, Mr. Ferretti, who has had a long, successful
career on Wall Street as an analyst with a major presence in the
energy sector, will focus on independent oil and gas producers, as
well as oil field service companies and special situations.  He
mostly recently was a senior energy analyst with Ladenburg
Thalmann & Company, having previously held similar positions with
Dresdner Kleinwort Wasserstein, ABN Ambro, Dillon Read and
Company, and Howard, Weil, LaBouisse, Freidrichs, among others.

"We're delighted to have Paul join our Equity Research
Department," said John F. Sorte, President and CEO.  "His many
years in the financial community and his expertise in the energy
sector, as well as Paul's broad recognition among institutions as
a leading research analyst, makes him a valuable addition to our
team."

Mr. Ferretti is a member of the National Association of Petroleum
Investment Analysts and the Association for Investment Management
and Research. He holds a B.A. in Economics from Brooklyn College.

Morgan Joseph & Co. Inc. is a full service investment bank serving
middle market companies.  The firm is involved in providing
financial advisory and capital raising services including M&A and
restructuring advice, and equity and debt private placements and
public offerings.  In addition, Morgan Joseph provides equity and
high yield debt research and trading for institutional clients.
Morgan Joseph's staff of more than 100 includes over 60 investment
bankers, who are highly experienced professionals mostly from
major Wall Street firms and intimately familiar with the issues
facing middle market companies.


* Smart and Associates Adds Six Attorneys in Chicago Office
-----------------------------------------------------------
Smart and Associates, LLP, disclosed professional additions to the
Chicago office's Litigation Support and Forensic Accounting
Practice.

Six professionals joined the Litigation Support and Forensic
Accounting Practice in Chicago:

   -- Joseph C. Tomaino, Partner;
   -- David E. Aberman, Director;
   -- William C. Hebble, Director;
   -- Arlen S. Lasinsky, Director;
   -- Randall D. Wilson, Director; and
   -- Timothy M. Powers, Senior Associate.

This team brings significant experience in Litigation Support and
Forensic Accounting to serve Smart and Associates' clients in
Chicago and the Midwest.

The team has substantial global investigative experience in the
areas of Computer Forensics, Corporate Investigations, Commercial
Disputes, Anti-Money Laundering, Bankruptcy/Corporate Recovery,
Forensic Accounting, Fraud Investigations, Background
Investigations, and Litigation Services.  The team's specialty
industries include financial services, stock brokerage,
government, retail, real estate, banking, automobile sales,
commodities, construction, healthcare, insurance,
telecommunications and securities.

                  About Smart and Associates

Smart and Associates, LLP, is a business advisory and accounting
services firm serving clients throughout the U.S. and globally,
with offices in Atlanta, Baltimore/Washington, D.C., Chicago, New
York, Philadelphia and Amsterdam.  The firm offers a comprehensive
range of Accounting and Assurance; Business Management; Financial
Advisory and Tax Services; and Technology and Business Process
Solutions.  Contact us at http://www.smartllp.com/or
(312) 849-2900.

                          *********

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.

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.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L.
Metzler, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Jazel P.
Laureno, Cherry Soriano-Baaclo, Marjorie Sabijon, Terence Patrick
F. Casquejo, Christian Q. Salta, Jason A. Nieva, Lucilo Pinili,
Jr., and Peter A. Chapman, Editors.

Copyright 2005.  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 $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher Beard
at 240/629-3300.

                *** End of Transmission ***